haidi: a very good morning. we are counting down to asia's major market shery: welcome to daybreak asia. our top stories this hour. the world economic forum canceled its singapore meeting as virus cases spike. the travel bubble with hong kong is grounded once more. asian stocks poised for a muted open. cases in the region pick up.

the dollar weaker with the economic outlook waiting on the sentiment. mixed messaging from elon musk has sent bitcoin and other cryptocurrencies on a wild ride. haidi: let's take a look at how we are setting up. sophie: looking at a start for the tuesday session. japan's per luminary report headlining the economy. japan expected to return to contraction. trading ahead of the update. we have wti holding above 66. trading near an 18 year high . pulling up a chart on the terminal when it comes to europe's recovery and increasing vaccinations. aipac listed companies who generate a chunk of their revenue from europe out facing

the regional index. goldman expecting we will see positive -- we are seeing covid cases in the u.s. have been falling to a 14 month low. new infections are on the rise in asia in taiwan as well as singapore. india a big hotspot for covid infections. india hitting the highest levels since the pandemic began. that is prompting governments to speed up vaccination efforts. in japan, reporting there are plans to approve moderna vaccine on may 21. shery: this news could not come at a better time. resident biden planning to spend millions of vaccines abroad for the first time as supply starts to outstrip demand. >> by the end of june when we

will have taken delivery of enough vaccines to protect everyone in the united states, the united states will share at least 20 million of those doses. shery: the announcement comes as the u.s. recorded its lowest number of infections since the early days of the pandemic. let's get more from health care reporter michelle cortez. this is quite a turnaround for the u.s. michelle: the u.s. is doing an incredible job when it comes to vaccinating its population. we have more than half of the country that has gotten a shot at this point. at the end of june, president biden said we will have more than enough to vaccinate every american age 12 and older. the u.s. is looking to what it should do with the supply we have seen. the president previously said 60 million doses of the astrazeneca shot are planning to be shared abroad. that is not approved in the u.s.

they have been holding it back while they are doing analysis to make sure the vaccine is still in good shape. the next 20 million he announced to today, those are the most coveted shots. pfizer and moderna, mrna vaccines, the johnson & johnson one does shot. those will be going out in the next couple of months. where they go we are not sure about that. haidi: i am looking at the results of a new survey that showed americans that resisted wearing masks when they were urged to are less inclined to get the vaccine. perhaps that correlation is not so surprising. i have been wondering what that means given the cdc has dropped the mask mandate for people who are vaccinated and there is no way to make people prove that. there is no need for you to show your vaccine card because you are not wearing a mask. michelle: i talked to a number

of experts who say we are entering one of the most dangerous periods of the pandemic for people who have resisted getting vaccinated. the reason that is is because they are going to be exposed to these new variants that are more infectious and potentially more devastating. they don't have any immunity from having a previous infection or being vaccinated. the potential damage could be much greater. there are some people saying this is a natural consequence. if you want to take the risk of getting coronavirus, that is on you. there are populations in the world who are not able to get vaccinated kid people who have other medical conditions. some people do not respond very well to the vaccinations. that is especially true for elderly people or anyone who has an immune system condition. it is an issue of people who do not get vaccinated and who are not wearing masks could keep this virus circulating.

and allow it to develop more of these variations. that is a potential risk now only for the u.s. but the entire world. hopefully people -- change their mind. as more and more people are safely vaccinated, these rates are coming down. people are not having terrible side effects. shery: our health care reporter, michelle cortez. the world economic forum has canceled its meeting in singapore following an outbreak of virus cases in the city. let's get more from haslinda amin. a big disappointment for singapore and it shows how quickly these things can turn on a dime, on one outbreak because just a few weeks ago, singapore was one of the best places if

not the best place to be during the pandemic. >> you are right. it is down to the uncertainty of how we are going to get out of this pandemic. a huge disappointment for singapore. it was banking on the world economic forum to show the virus was contained. they were hoping it could help boost tourism. it is a huge disappointment for the rest of the world, which is watching closely on how we can work toward normalcy and to see how a bubble can be implemented. that is going to take a while longer. the world economic forum citing tragic circumstances. travel outlook makes it difficult for one to host a global event. the different speed of vaccination as well. we have seen how the different countries are struggling to get vaccination off the ground.

but we heard from the founders saying it was a very difficult decision, but at the end of it, it is important to talk about safety, to ensure safety. that is a top priority and the reason why the event has been canceled. he did say it will go on with the annual event. it will decide by summer when and how that will happen. as far as singapore is concerned, it is grappling with the containment. what is the issue is the mutant virus. the virus that was first seen in india that is more aggressive, more infectious and we are seeing more of that in cases in singapore. what is also worrying, it is attacking the young people, prompting singapore to shut schools and is looking to vaccinate those under 16. it is waiting for approval for that to happen. shery: not surprising that

travel bubble with hong kong has also been delayed again. >> adding insult to the wound. it is something that was supposed to happen in december. not for -- not surprising. what is also difficult as singapore is now reclassified by hong kong as a high risk destination. it means those traveling from singapore to hong kong will have to be quarantined for 21 days. this delay reflects how difficult it is to open up the borders. just about last year, months ago, we were talking of the bus ability of a bubble with other countries like agiven how

to give you some perspective on how the high risk designation impacts singapore, it is classified in the same category as argentina, leisure, italy. it is a difficult position for singapore. shery: our chief international correspondent for southeast asia. still ahead, we will assess the surge in cases in taiwan with former vice president and health minister. he was at the forefront of the response. let's get to vonnie quinn with the first word headlines. vonnie: more virus restrictions have been lifted in the united kingdom as it takes the next step out of lockdown. prime minister boris johnson is concerned the highly transmissible virus strain in india could lead to a surge in infections. the government is accelerating the rollout to include people 35

and older. johnson is facing pressure from his own party to stick to the timetable for full reopening. bloomberg news has learned italy plans to phase out a national curfew in push to reopen is its economy -- reopen its economy. we are told the cabinet approved speeding up the timeline for reopening businesses. it has also approved resumption of indoor dining starting june 1. the european union said it will not hike tariffs on a range of u.s. goods over a dispute. the e.u. commissioner says it will refrain from increasing duties. in return, the e you will discussion the metal issue. it began in 2018 when resident donald trump at the time slapped levies on steel and aluminum.

a cyclone slammed into india last monday with the wind speeds as high as 190 kilometers an hour. heavy the rain -- heavy rain threatened some areas. the national disaster response force has deployed dozens of teams. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i'm vonnie quinn. this is bloomberg. haidi: still ahead, funds are flowing out of asia and into north america and europe. we will discuss with the director of research. plus, japan is due out to report first quarter gdp data. the numbers are expected to show a contraction again. this is bloomberg. ♪

haidi: we are getting more reports out about these proposed talks in the deal being made between amazon and mgm. this is a film studio arm of the mgm empire. we are hearing from roof -- from variety saying amazon is said to have made a $9 billion offer. we heard earlier that amazon is in talks to acquire metro-goldwyn-mayer, the film company behind the likes of the pink panther and the james bond enterprises. we are looking at this report, a number being assigned to this deal being offered. $9 billion in the offer made according to variety. amazon along with a number of

these other streaming and content companies looking at acquiring more content as they continue to develop your we heard last -- to develop. we heard last year mgm had hired advisors to explore a transaction like this. shery: since the start of the year, investors were looking to asia to lead the global rebound. since the beginning of the second quarter, investors have poured $36 billion into epf our track, european and north american equity fund group. joining us to discuss is the director of research. rate to have you with us. what is -- great to have you with us. what is driving this shift? >> the usual suspect, which is the unexpectedly large amounts of stimulus being thrown at an already recovering u.s. economy. earlier in the year, it was not

clear that president biden would have the freehand or would be as aggressive as he has proven in pursuit of stimulating the u.s. economy. we are still waiting on the results of two key senate elections and historically -- elections in a historically republican state. interestingly, it is also a reflection when it comes to asia -- and this has been more true than many might think, from a mutual fund perspective, we have seen investors respond more strongly to policy shifts then they have in most cases to the covid numbers. asia -- flows to asia started to stumble when chinese authorities into that their recovery -- that

they feel is strongly based enough for them to start considering some degree of policy normalization. shery: last year, the darling for investors was china. how interested are investors on china right now? >> they remain very interested certainly when you look at flows to dedicated asia funds, especially at the country level. china equity funds and everyone else is a runner-up. the two country fund group doing the best after china are hong kong and taiwan. part of the greater china universe. japan equity fund has seen solid inflows. there is an element of bank of japan support in those numbers. haidi: i want -- they inflation

surprises pretty much global. your investors are looking at inflation hedges. where are they finding them at the moment? >> that is a good question. certainly, we have seen a lot of money and this was long before the narrative had taken hold. a lot of money going to inflation protected bond funds all over the world. in recent months, certainly in the u.s., there has been a sharp jump in flows to bank loan funds. more commonly known as floating-rate funds where the interest rates on the securities that are in those funds rise with the markeone thing that cay attention is until very recently, we had not seen the surge into silver and gold funds that often accompanies

inflationary concerns. haidi: when it comes to emerging markets, the direction of the dollar is the main one but inflation overshoot and the flow on effects, is that something of a concern for em investors? >> right now, the main concern is two things. one is the heat of the u.s. economy and the impact that may have sucking capital at of the emerging markets pool. it is also policy. countries that can even hint at reform story continue to attract surprising amounts of money through mutual funds. a case in point is brazil, which has a terrible covid containment record, but flows to brazil

equity funds over the last four or five months are being driven more by perceptions of a whether the president's administration will have enough capital to continue the reformist agenda. haidi: great to have you with us. director of research at epfr. we will be discussing which hedge bond -- which hedge fund made the most notable exit. this is bloomberg. ♪

haidi: we are getting the deadlines for the 13f filings.

what stock they hold as of the end of each quarter. su keenan, we like to say the 13f gives us a sneak peek into where money is being invested. what do we learn? su: it is a fascinating look. the smart money, they have lagged the market in recent times. a couple of key themes emerge. alibaba seemed to fall out of favor of many funds. disney and other stocks dumped by stan rep. miller:'s fund, it is exposed to family parks and the cyclical nature may have been what caused it to lug behind. gamestop. need we say anymore? went on a wild ride with all of the meme generated rallies. we know melvin capital lost big time.

13f shows he managed to asset his position. one of the many funds diving into energy. added to an energy etf and a lot of funds were in and out of banking because that sector has tended to lag this year as well. shery: and other key theme of the last quarter. what do we know about how funds were impacted? su: it was archegos that caused the markets to rock pit you can see many of the stocks in the middle of that. viacom, cbs and disney plunged ruefully. that is when george soros's family bought.

biontech, moderna, j&j. warren buffett berkshire hathaway closely followed. looks like he exited some core completely. a firm he had a 700 million position in last year. he took position in an insurance rocher that briefly picked up after hours as the 13f was revealed. normally, buffett's brand-new ad to get attention. some are theorizing the buffett magic may be gone. shery: let's get a quick check of the latest business flash headlines. air -- at&t confirmed the blockbuster deal to's been off media operations merged with discovery creating rivals to netflix and disney. the agreements will merge assets ranging from cnn and hbo to hd tv and the food network.

discoveries ceo will lead the new entity valued at $130 billion including debt. the softbank vision fun is said to be considering listing a blank check company on the amsterdam stock later this year. sources say it is seeking hundred $4 million from the deal. it would target investments in the europe tech industry. the korean capital has made its first investment under the middle east, leading a funding round for an egyptian app. the cairo-based startup was launched last month.

it followed deals in india and the philippines peered up next, and ev start up is preparing to debut its first model. this is bloomberg. ♪ so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't. so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business.

shery: we are counting down to the start of trading in tokyo and seoul. in japan, we are watching first quarter preliminary gdp numbers. 20 minutes from now, there expected to show the economy in contraction, breaking two quarters of double-digit growth. we are watching softbank. may list a spac in europe. plus, local media saying the tokyo stock exchange could expand trading hours.

the session may extend into the evening to in -- the evening. in south korea, we are seeing samsung's initial in in -- initial win in a patent lawsuit. international trade commission plans to review part of the judge's findings. the u.s. military now is offering to give sam of its covid -- give some of its covid shots to south korean troops. bloomberg intelligence expecting more volatility ahead for local markets. the kospi recorded its biggest outflows of the year. it's turned to sophie in hong kong -- let's turn to sophie for hong kong. it is not just volatility in south korea. sophie: expecting near-term volatility to pick up. taiwan included. that will push valuations very taiwanese stocks to historic

lows. heading toward the 13.8. the head of taiwan research saying brace for mobile utility ahead. in light of that, switching out the chart on the terminal, that has narrowed taiwan's outperformance on asian stocks. that lead has been whittled down. taiwan's resilience does have -- 8% growth forecast for taiwan. there is plenty of fiscal firepower. expect factories will stay open. there is an expectation we will see the government come through with support measures. haidi: a check of ev maker for after hours. it paired some of the gains we

saw in the regular session. its plan to read -- to open a factory in the u.s. the ceo spoke with bloomberg about the company's plans. >> we have it down to the day when start of production happens. that is where we are different from all of the other startups. that is way we are undervalued. that is ok. we are here to deliver. so far, we have. >> you are a pre-revenue company. this is a progress report for investors. he seemed to be making a lot of progress with suppliers particularly on battery sales. who is supplying your battery sales and how happy are you with the terms of that deal? >> i am extremely happy. it might be one of the best batteries in the world right now. we are able to make this deal this year. most battery deals were made last year or the year before went batteries were very

expensive. we waited until the last moment. >> there is a lot of focus on the deal with foxconn to jointly develop an electric vehicle in asia and the united states. how much progress have you made on that deal? how will revenue be shared? is there any update on the u.s. factory? >> we have made lot a lot of -- quite a lot of progress. foxconn has been amazing to work with. it is my second design i am doing. i am doing it and we have a small team we put together from existing programs. what is fascinating is we did not have to spend a ton more money on this program. the people are phasing off the ocean program. now we are going into the final production phase and those people are available to work on the programs. >> you were a long way from the start of production. you were trying to get your

suppliers in place. what kind of visibility do you have on the chip side? is foxconn helping you? >> the chairman of foxconn told me chips may be the next weapon in the automotive industry. he told me we will not be missing any chips. it could be that we still receive some chip shortage for a royal because it is not just a general source issue. it is because a lot of chipmakers have turned to deliver to more profitable areas of industry. i think you are really well situated. >> the fisker ceo speaking to ed ludlow. still ahead, we will take a deeper look at the auto sector 's chip issues. up next, as elon musk's comment focuses attention on

environmental impact of bitcoin mining, we talk about how to tackle those issues. this is bloomberg. ♪

vonnie: this is daybreak: asia. president biden has pledged to

send millions of additional doses of coronavirus vaccines abroad by the end of june. the shots will include those cleared for domestic use. the president has said the administration will export 20 million doses from pfizer, moderna and johnson & johnson. >> we want to lead the world with our values, with this demonstration of our innovation and ingenuity and the decency of the american people. just as in world war ii, america was the arsenal of democracy . in the battle against covid-19, our nation will be the arsenal of vaccines for the rest of the world. vonnie: new york state will lift its mask mandate on wednesday. new york's vaccination rate is approaching 50%.

the world economic forum has canceled their annual meeting. it was planning for singapore in august. it cites a spike in infection and an uncertain global travel outlook. a spike in more transmissible cases has prompted hong kong to add singapore to its list of high-risk nations. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i'm vonnie quinn. this is bloomberg. shery:shery: one of the biggest investors in bitcoin as -- the cryptocurrency is likely to remain under pressure for weeks. neville gratz expects bitcoin to end 2021 higher. he spoke to bloomberg about volatility and the environmental impact of bitcoin mining. >> bitcoin will be somewhere

between 40 and 55,000 for the next chapter before it builds up enough new momentum to take out the 55,000. >> how concerned are you about the short-term volatility being introduced by len muskie? >> musk is an -- elon musk is an important figure in american business. in the crypto world, he is a bit of an icon. he was great for crypto when he was positive for bitcoin. he has caused some issues. what he said was he worried as bitcoin uses more and more electricity, it can have a negative impact on co2 emissions. that is true for every industry. you're going to see a response from this industry like you should see a response from every industry to say, in this gap of time before all electricity is green energy, which is 70 years away, we should do something to

offset our footprint. that is banking, crypto, tech, industrial businesses. >> is it problematic that one of the hottest currencies is a joke and elon musk who is this face of it all is whipping people into that one and multiplying the jokes. we have other influential people talk about other jokes. does it make it harder to make the case this is a series industry with a straight face? >> yes is the answer. i don't want to discredit the doge community or any of the communities. what you are seeing is a response against the monetary policy and the frustration people have had with the system. this young generation has said we can band together and create our own way of investing. we try to steer our clients away

from projects we don't think have long-term sustainability. it proves that communities can band together. the world has gotten very tribal. that is not necessarily a good thing. if you go on crypto twitter, you realize how tribal it has gotten. one of my buddies make some negative doge comments, and he has six death threats. let's that -- let's not miss the forest for the trees. there is a huge revolution going on made by serious people. haidi: speaking with sonali basak and joe weisenthal. it's get back to the environmental concerns about bitcoin in guest says there are ways cryptocurrency could become sustainable. great to have you with us. what elon musk raises is nothing new. we have all seen the headlines

for how bitcoin mining takes up more electricity than some entire nations. you see it as an inflection point for how the broader crypto industry could move forward in a more sustainable way? >> thank you. the recent statements around climate concern of elon musk, the concern of artists around the climate impact of non-fungible tokens have made it clear the climate issue is something that our industry ignores at its own peril. we see the bull market -- it looks like a has been popped and is on a steep -- a deep dive right now. there is industry -- there is interesting data showing the peak was march 13 just as environment of concern was happening. we have seen major companies along with artist and everyday people who want to get involved in crypto who want to be in this

fascinating revolution because of fears around the climate impact and we need to fix that. haidi: what needs to happen? we are seeing more interest in state tokens or ones moving toward doge coin. is it a silver bullet here? >> it is a silver bullet where it is a good fit. and where the blockchain and community around it want to see it happen. ethereum is moving to proof of stake in a year or so. i believe that will be happening. it will be driving their carbon footprint down to near zero. that is why we are comfortable using it for our work. with bitcoin, there is no interest. it is not going to go proof of stake. we need to look at other tools

to address that issue. i think there are a couple main focuses. one way is the people have lots of stories and their arguments people -- and their arguments people have. bitcoin can renewable -- can use renewable energy. it cannot. what is important to move forward into is being able to make green choices around bitcoin including using we noble energy, purchasing offsets to offset the footprint and a that to real information around the carbon footprint of the bitcoin and the prominence of these environmental assets that take it to carbon neutral. we are able to do that kind of at the investor level. nine point bitcoin etf in canada is using a company called card and ask to offset the footprint of the bitcoin they are putting

in their etf's. shery: the way it is set up right now, what is the carbon footprint of crypto? as you said, some say the miners are using renewables. what do we know i this point? >> there are strong estimates, which people feel comfortable with including a group out of cambridge and some other derivative work to say the carbon footprint is around 48 million tons of carbon emissions per year. ethereum is around 12 million per year. they say another 25 from other proof of work mining. this is a lot and a little. bitcoin is like a thousand of the global carbon footprint. it is still a major piece. what i recommend is chipping away at the opportunities to

understand the real footprint and embody proof of the carbon benefit along with those tokens. we see people looking at ethereum to raft a coin along with those very mental assets. working downwards and speaking with the miners. they are hard to get to share their data. ways to incentivize miners to share more information around their carbon footprints. haidi: very quickly, if i am an institutional investor within esg mandate, can blockchain's help me identify a green crypto or bitcoin i can invest in? >> i would say yes. for people focused on bitcoin, i would say look at and support the space of people trying to work in the silos i was mentioning before around

understanding the footprints, refining the knowledge down to the individual bitcoins. i do believe you can bring that by offsetting your whole purchase of them. i believe by wrapping the tokens of environmental assets can also allow a large buyer, a person taking a position, a public company to know there are green assets around their bitcoin. with the move to proof of stake, i highly believe in the blockchain using it to put agreement on the blockchain to connect the carbon accounts of all the world. we know we will be able to neutralize the footprints of the network usage, which is important for overall mandate to provide tools to companies to issue an exchange. haidi: greater -- shery: great to have you on. founder and executive director

of the blockchain for climate foundation. this is bloomberg. ♪

shery: we do have breaking news out of japan. we are getting the first quarter preliminary gdp numbers. a contraction of 5.1%.

the expectation was for a contraction of 4.5%. this is also funneling two quarters of double digit growth. this is risking the possibility we could see a double-dip recession after the worst recession on record last year. when it comes to nominal quarter on quarter, a contraction of 1.6%. gdp deflator you're on your also a contraction of .2%. quarter on can order contraction, 1.3%. all these numbers are surprising to the downside and as he expectations. private consumption, contraction of 1.4%. surprising to the upside. a smaller contraction then why was expected. -- contraction than was expected. overall, the numbers not looking dead. -- not looking that great. if we do see and other quarter

of contraction. let's get some analysis from the bank of america global research head of japan economics. that time of year again. what do you make of these numbers? they seem a little weaker than expected. >> that contraction was in line with expectations. if you look at the subcomponents based on what i can see, the contraction in consumption was slightly smaller than expected. the slowdown in was bigger. overall, there is not much new information. we did know there was a third wave of sod that affected consumption earlier this year. these headwinds from the pandemic are continuing. we are in the midst of a fourth wave. the worry now is about the lingering downside effects of

consumption this quarter. shery: very slow vaccination right now in japan. does that mean we are risking a second recession? >> i think the second quarter, we still have a slight expansion penciled in. the possibility of a negative reading. the reason is because there are two headwinds phasing japan in the short term. the first as the state of emergency and angering covid effects. the second issue is the manufacturing said. so far, exports and manufacturing activity have been very robust. it has been holding up the recovery. and the short term, we are facing concerns around supply-side shortages. depending on how bad the production numbers get, we could have a negative reading. haidi: how closely are you

following the chip story and that potential to further drag ? >> we know the biggest impact so far have been felt in the auto sector. it will be a modest production cut as a response to these shortages. the concern is two fold. one is how long the negative effects on the auto sector linger. does it normalize by the late summer? the second issue is whether the shortages broaden beyond other autos. there have been anecdotal stories. we are not seeing any the surveys or the production numbers the shortages are broadening outside of auto. that would be something to look at. haidi: we see the struggle to get on top of the virus continue in japan. lots of skeptics about whether tokyo olympics will go ahead.

is it a positive or negative? will it be hugely detrimental if they don't go ahead economically speaking? >> i have been feeling the limbic's question probably every five days. -- the olympics question probably every five days. if it is canceled, i think the macro impacts or memo. it will have a negative effect on sentiment. it is not a huge economic impact. it is not positive at least in the near term. shery: the japanese yen has been the worst performing g10 currencies so far. how much is this helping? >> the degree in appreciation is not enough to move the needle. given that earlier in the year consensus was looking at a much stronger yen, there were concerns about this being a

headwind. the facts the -- the fact the end are longer looks to be a risk as positive. one driver is the re-acceleration of m&a activity. with these kinds of flows continuing, we see dollar-yen at 113 by the end of the year. haidi: always great to have you. we'll get lots more analysis coming up on bloomberg television. a little bit later on, we'll be taking a look at the prospects for the indian economy. this as the nation reaches what could be the peak of new covid infections. still ahead, talking about the chip shortage. a wake-up call for the industries to raise their sophistication of semi connector supply planning. the jp morgan investment

specialist tells us why she is betting on china a-shares as she this is bloomberg. ♪

shery: welcome to " daybreak asia." haidi: asia's maker -- major markets have just open for trade. japan's economy contracts further than expected in the first quarter due to virus -related states of emergency. that breaks a six-month streak of double-digit growth. the world economic forum touts its anticipated meeting in

singapore -- postpones its anticipated meeting in singapore. plus a bloomberg scoop. china seeks to join the trade deal designed to exclude it. japan, south korea, and australia coming online. let's turn to sophie for the action. reporter: we're seeing the upside for japanese stocks. the nikkei is recovering from losses we saw on monday. jgb is looking for a -- is looking for support. the recovery is stalling for the economy amid new virus curbs. we are looking at south korean chipmakers, as a analysts -- as analysts recommend buying on weakness. the kospi is down. we've seen resale continue to boom, but we are seeing the

rotation into value from tech creating a wobble. in australia, we are keeping an eye on energy players this morning. a new hydrogen valley project will include names from japan. we are also watching copper miners following chile's election results. cash treasuries are trading around 16 e4 on the 10 year yield this morning. we are keeping an eye on the oil patch. brent is saying steady above $69. -- it's staying steady above $69. optimism is building over fuel demand rising in the u.s., as well as europe. we are seeing the global infection curb moving lower. when it comes to asia, we are

seeing cases pickup, however. we are seeing asian infections rise across the board, including in india, as taiwan has been a concerning place as of late. we are seeing this inflation led tech selloff radel investor appetites for the taiex as well as other heavy -- other tech heavy indexes. haidi: speaking of dividend yields, equity income strategies are looking interesting at the moment. high dividend stocks that were value plays last year are now trading at more attractive levels. let's talk within investment specialist at j.p. morgan asset management.

do see more opportunities in yield stocks, rather than growth echo -- growth? >> i think it is getting more favorable. if you're looking at the terms of the environment, normalization is a pretty clear trend. financials should be the main topic. we can talk about improvement. potential expansion in the margins. maybe growth in the near future. haidi: of course, inflation pressures concerned -- concerns. how are you hedging inflation? guest: for inflation, the center that

can benefit from it is financial, as you mentioned. the other factors that can potentially benefit from it -- sectors that can potentially benefit from it would be the materials related names. i thing we be selective -- i think we have to be selective. commodities prices may search temporarily and we can select some of the materials that will benefit from structural growth trends like electrification. shery: what happens if that rally comes to an end echo we are seeing the commodities index off this year's high. which assets will be hurt if the commodity rally comes to an end yucca -- an end? guest: we always say you should have diversification in your portfolio. while we should have some financials and materials, you

should also have structural growth investments, like technology, health care, and consumption. it is very important to maintain discipline. shery: we have seen a rotation out of technology. is this the right time to go in and buy the dip? guest: technology is a big universe. you can invest in hardware or software. recently we are seeing increasing rates that are concerning in internet related areas. but the backdrop remains very good, particularly considering some of the shortages globally. overall, there remains a pretty good set up for some of the technology. current consolidation presents good buying opportunities.

shery: janet, when we speak to analysts they keep telling us that virus infections is a big differentiator between markets they like and not. this is a factor for you at a time one -- at a time when places like taiwan, south korea, japan, singapore are no longer doing that well and containing the virus? guest: i think, of course, if you're looking at the performance over the last year, you really can see differentiation between who can control the virus and who is not that effective. from a fundamental perspective, we need to look at where the trends are and where the earnings growth's coming from. if you look at some of the big trends here in asia, that remains in technology, and consumption. while there might be short-term

pickups in technology-related sectors, even in taiwan, eventually the long-term trend will be there. we are not too worried about the recent pickup -- hiccup. any consolidation is a good buying opportunity. shery: janet tsang, great to have you on. let's turn to vonnie quinn with the first word headlines. reporter: about 39 million u.s. households will start receiving monthly child tax credit payments as part of president biden's american rescue plan. the payments are up to three and a dollars per each child up to age six and $2050 per child -- 250 childers -- $250 per child above the age of six to age 16. new york will list mask

restrictions. governor cuomo says it took a few days to analyze the new recommendations. cases continue to fall. the eu says it will not hike tariffs with the u.s. following its feud involving metal tariffs. they will refrain on increasing tariff duties on product like bourbon whiskey and harley davidson's. the tif began in 2018 -- tiff began in 2015 when donald trump put levies on products. israel's taking a significant shift in its approach to its complex -- conflict. biden is taking chris's him for not being more vocal in his

calls for a cease-fire with more than 250 dead on both sides. 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. haidi? haidi: will take a look at that chip sector with a partner at apec telecommunications. the world economic forum has canceled its annual meeting set for august in singapore. this is bloomberg. ♪

shery: the world economic forum has canceled its annual meeting several august in singapore following an outbreak of virus cases in the city. the gathering was moved from

davos. quite a disappointment for singapore when they have the virus really rained and until recently. -- reined in until recently. reporter: is a huge disappointment, especially when you juxtapose it with new york, which will host the new york marathon in november as planned. 33,000 runners are expected. a huge disappointment for the lion city which was banking on the world economic forum to open up its borders. it is also huge disappointment for the world, which was looking really closely to see how we can inch towards normalization and travel levels. it will take a while, yet. we have the world economic forum saying that it is tragic circumstances. it makes it really difficult for a global event to take place with the uneven rollout of vaccines, especially at the

scale of the world economic forum where participants will come in from all over the world. we talked to the founder of wef who said it was a difficult decision, but in the end the safety of the bars depends is most important. -- of the participants is most important. we had more than 20 cases yesterday, and addition to 38 on sunday. they are worried about the mutants of virus, the virus first seen in india that is more aggressive and infectious and we are also seeing it among the younger population of the country, those in schools. that is why schools have been shot until the end of the month. we are also exploring vaccinating those under 16. we are awaiting a clearance for that to happen. shery. shery: haidi. haidi: another setback for

singapore. this travel bubble has been delayed for a third time. really disappointing, right? reporter: it was meant to take place in december. it has been delayed. with the operate we are seeing, they just cannot meet the criteria for this bubble to take place. a delay yet again. a blow for singapore as hong kong re-classifies singapore is a high risk destination. joining the likes of argentina, italy, japan, malaysia, all in the same category. which means those traveling from singapore to hong kong will be required to go through a quarantine of 21 days. both cities say they remain committed to this bubble. they will revisit this bubble mid june to see how i can go ahead. -- see how it can go ahead.

i do not think we are going anywhere this year. haidi: it has been a big exercise and comfortable where you are. our chief international correspondent for southeast asia. still ahead on "daybreak," the surge in taiwan. will assess it -- we will assess it with someone who was at the forefront of the islands response. and on the monday the u.k. allowed people to travel again to a limited green list of countries, including portugal. yet tourism for the summer remains uncertain and popular destinations like spain and france are not part of the green list. bloomberg spoke with executives about their hopes for the summer. >> this is huge. this pent-up demand for people to come see family members they have not been able to see across this pandemic. and people who want to go on holiday. the amount of demand there --

it's up to unwinding the restrictions. >> most european countries are protecting they will get about 80% of their adult population a vaccine by the end of june. we think we are looking at a very strong july, august. september, even september, we will see the booking trend support it. >> this is happening across europe. weeks back to see more countries added to the green list -- we expect to see more countries added to the green list read >> we hope to achieve 50% of vaccination. we see interest all around europe and the u.s. so we are actually cautiously optimistic as we speak. >> we believe much of europe could go onto that green list. shery: there are about 400 cases of the india coronavirus variant in a london with about a hundred

links to travel. this is the city's reopening and relaxing restrictions. the london mayor stressed the need for more vaccinations to protect areas where the indian variant was showing up. >> the virus is still with us. the good news is almost 6 million or -- 6 million londoners have received the vaccine. we will keep an eye on this indian variant. make sure you test regularly. if you are worried, have a pcr tests. every single test where someone tests positive we are checking to see if you have the indian variant. >> how widespread is it? >> we think we have about 400 positive cases in london, so we are thoroughly contact tracing

those who have tested positive to see who they have been in contact with. about a hundred have had a traveling to india. it is important we are not complacent. at the same time, we are encouraging people to enjoy the sights and sounds of our city safely. reporter: it's really something to get excited about all of that but with most people under the age of 35 in the city unvaccinated, are you at all concerned that as those younger ages, to enjoy all that london has to offered that the indian variant will spike up? >> we are enthusiastic and cautious. since the peak in winter, we have had the reduction of cases around 98%. hospital admissions are down by 96%. the game changer is the vaccine, but also testing. it is really important all londoners test regularly.

it is important we support london's economy. one out of five jobs are in hospitality and culture. it is possible to have a great time and protect jobs and make sure the virus does not spread. haidi: london mayor sadiq khan there with bloomberg's hannah edwards. china is moving ahead with talks to move ahead with a major trade pact that was originally assigned to exclude it. we have the details next. this is bloomberg. ♪

shery: china's pushing ahead with talks to join a major trade deal that originally aimed to exclude beijing and cement u.s. economic power in asia. our team managing editor is on the line. we are talking about the transpacific partnership, which

became a new deal after the u.s. left. how serious is china about this? reporter: we knew they were having informal talks about joining the ctppc, but there were not many details. we have spoken to people on either side, and they are saying officials from some of the member countries that have been in the discussions have said they do view china's interest as serious. pointing in part to comments made by president xi jinping back in november, where he said china would view this favorably. the talks are going on -- they are behind the scenes. they are quite technical at this stage. they do suggest china is pushing ahead with this potential entry.

haidi: we've spoken to a number of representatives and other politicians from the various countries in the past. they have always said they are open for talks if beijing wanted to join. there are some serious roadblocks ahead. reporter: there are many roadblocks. it is a long list of hurdles beijing would need to get through. one involves that it is a tougher agreement than the regional agreement beijing was able to push their last year. the tpp is viewed as having a bit more teeth, some more demanding things they would need to follow and agree to follow up on and go along with the obligations outlined by the international labor organization

. there are constraints -- potential constraints as to what china's heavy role of state owned enterprises would be reconciled with any trade agreement. and also, of course, there are many political squabbles out there. china is involved in what summer describing as a trade were -- in what some are describing is a trade war with australia. there is historical animosity flaring with korea and japan. the list of constraints is high, even before we get to taiwan, which is also believed to be having some interest in joining. what would that mean for china's position? it opposes taiwanese participation in any international organization or agreement. shery: there was hope that the biden administration would reconsider the u.s. joining this

agreement. if china were to join, what would that mean for the u.s.? reporter: it would be a great irony. the original tpp was designed in some part to exclude china and give the u.s. the ability to control the trade narrative. that backflips once the political backing for these trade agreements dissipated. once the u.s. pulls out, japan takes over and leads the charge to get this thing done. if china were then to join this pact that was originally designed to exclude it, that would be a great irony. what the chinese are signaling is that they hope everyone joins. they are saying -- hey, it does not need to be a bipolar choice between us and the u.s.. they are saying we can join. and the americans can two. -- can too.

haidi: malcolm scott, our bloomberg asia economy editor there. let's get you the latest business headlines. china's biggest carrier is said to have made a shanghai listing plan after being removed from the nasty under a trump era investment plan. they will develop 5g networks and infrastructure. the plan needs shareholder approval. amazon is reportedly in talks to buy mgm and its major film library. that is according to variety which says the deal could be worth as much as $9 billion. the move would be amazon's biggest yet to enlarge in its entertainment presence. this comes as a growing number of states and federal

authorities seize pandemic restrictions and set dates for reopening businesses in the weeks ahead. the move adds pressure on rival banks, so they can adjust their own returns to the office. lots more to come.

>> this is "daybreak asia." president biden has pledged to send millions of doses of coronavirus vaccines by the end of june. the president says his administration will export 20 million doses of vaccines from pfizer and moderna and johnson & johnson in addition to 60 million astrazeneca shots he has already sent. >> we want to lead the world with our values.

with this demonstration of our ingenuity and the fundamental decency of the american people. just as in world war ii america was the arsenal of democracy in the battle against covid-19 pandemic, our nation is going to be the arsenal of vaccines. >> more restrictions have been lifted in the united kingdom as it takes the next step out of lockdown, but boris johnson is concerned the virus strain originating in india could lead to a search and infections. -- a surge in infections. johnson is facing pressure from his own party. bloomberg news has learned early plans to phase out a national curfew in a push to reopen its economy. prime minister mario draghi's administration agreed to if infections keep declining.

he also approved the resumption of indoor dining starting june 1. the world economic forum has canceled the annual meeting it was planning for singapore in august. earlier, singapore and hong kong once again delayed a travel bubble. a spike in more transmissible cases has prompted hong kong to add singapore to its list of high-risk nations. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. >> a year ago, consumers were the ones panic buying. today, companies doing the hoarding and pushing supply chains to the brink. our chief asia economics correspondent joins us now. what is driving this massive

supply crunch? >> right now around the world, consumers are hoover ring -- hoovering up goods at a breakneck pace. manufacturers are struggling to get the material they need to make goods. there is a shortage of key commodities. iron ore prices are through the roof. a shortage of semiconductors. there are logistical issues. there have been weather events. we had the suez canal block a few months ago. what manufacturers are saying is there are pressures on their supply line that is turning up their production model upside down and leaving them with orders they cannot meet, scrambling to get input and commodity materials they need to make their goods and facing rising costs. it is a perfect storm for the global manufacturing sector trying to meet this demand as the world crawls its way out of

the covid crisis. >> what does this mean for the world economy? >> this is the big debate. on paper you have commodity prices going through the roof. we spoke to a lot of manufacturers and they all say prices for everything is going through the roof, so on paper, you are saying if these factories are facing higher costs, they are going to pass it along to consumers. economists are wondering how much they can pass on costs to consumers and whether or not this is only a temporary blip given the supply disruption that will eventually wash through the system. one thing i have picked up his manufacturers make the point the

breadth of disruption is like nothing before. he does not just one particular commodity or the cost of oil. it is across the board, they are paying through the roof for these input materials. they cannot even source them. that kind of environment, it would be hard to rule out any kind of inflationary spillover effect. >> what do you see it taking for the situation to improve? >> it goes back, is it transitory? this is the line on the inflation debate. when we speak to manufacturers, they are not saying much by way of circuit breaker. they are trying to buy as much import material as they can to ensure they have inventories to make the goods that are on order 6, 9 months for now. they are not seeing a circuit

breaker. take the suez canal. once we get past chinese new year, prices will come down. it has not played out like that. likewise the semiconductor story. i don't think anybody has seen a near-term story turning up anytime soon. south korea talking about investing to ramp up chip production. of course some of this is transitory. when you speak to these factory managers on the ground, facing deferment orders, they are not hopeful for any near-term circuit breaker. >> our chief asia economics correspondent helped us delve into that semiconductor shortage. our next guest has seen a big

wake-up call for chip consuming industries. they will need to build more flexibility. let's bring in -- great to have you with us. so adding redundancies in the supply chain, building flexibility. does this equal more costs? >> it is a fundamentally important question. the broader implication is that for just about every industry, which today is every sector we can think of, needs to raise its game in terms of product design and supply chain planning. what we are seeing today is simply a case of supply imbalance bumping up against the structural characteristics of semiconductor production. demands have been robust. there is a trend toward everything getting more smart.

also the covid or pandemic spike in items like laptops and tablets and so forth. supply has remained relatively stable. overall this remains stable. the challenge is changing that supply equation takes years. in the near term there will be a constrained -- a constraint and implications on pricing, but it will come down to what portion of the bill of material is really semiconductors and chips versus everything else. >> how long is that short-term imbalance we are still going to see? >> when you look at semiconductors, the typical factory takes from years ago is several billion dollars.

all of the production is obviously sold to customers. in the near term, just adding a shift, tweaking the process, these are operating often at the extremes of physics. it is very hard, it takes weeks, and that is just the physical and chemical processes that need to happen. in the short term it is very hard to increase supply. there is always some level of tweaking that is possible both in terms of the manufacturers adjusting product designs to perhaps alternate semiconductors or chips or leaving out features. in terms of the producers trying to eke out the extra production, scouring the supply chain for infrastructure -- but production increase takes time to come

online annmarie: -- to come online. >> when you talk about the agility of the consumer end, are there examples you can make where that is being done well at the moment? >> the typical element where you build in that kind of agility is as an example, many products have semiconductors that need to go into them. the moment you go into custom, you need someone to produce them. you work with a foundry to optimize the process. to the extent you can use more industry-standard parts, to the extent you can qualify more than one company to build those chips for you, to the extent that is distributed across more than one balance sheet, that builds resiliency into your supply chain. the best manufacturers tend to do that.

typically that carries some cost and effort upfront. the equation is how much should i invest upfront in order to build resilience? think of an automobile as an example. semiconductors are a few hundred dollars. the total bill of materials for a car, you are spending $500 on semiconductors. that has grown over time. still, it is a small portion overall. however, that portion is starting to have input constraints on the total production car companies are able to drive. that economic equation. >> how much of this is on companies that have not done a very good job of working out there demand? -- their demand? >> a good question, and it has been hard. you look at the macroeconomics

of the past 15 months, we have not seen anything like it for some time. it was hard to predict with any accuracy what demand would be. part of the reason we are here today is in the early days of the pandemic, they have upped forecasts as it went on. it is pretty hard to forecast with accuracy. what you do is work with scenario planning. what scenarios could play out, how good or bad could that be, and how can i mitigate the situation and build in flexibility? that is how you deal with it. it is difficult to forecast with accuracy when some timeout, you look at the macroeconomics, things we have seen in the past

18 months or so. >> we speak with such concise insight now. really great to have you with us. coming up next, at&t agrees to spin off and merge its media assets with discovery, a move that would create a new media giant to rival disney. ♪

>> let's turn to sophie for what to watch. >> stocks higher in asia. as japan leads the pack it in the region, the nikkei 225 adding 1.25%. in seoul, the kospi gaining 0.7% even as the korean won is weakening to a march 10 low. the currency could hit 1180 this year should the fed start mentioning around july or august. we are seeing the aussie dollar rise. stock movers of note in sydney, one highlight in the commodity space, shares under pressure by double-digit after a miner cut

production guidance for the full year. copper miners are climbing after chile's election results which may see copper producers face higher taxes. keep an eye on james hardy this morning, sinking the most since november in sydney after the results which missed guidance. in tokyo, japan and usg gaining. sony shares moving to the downside. the company inked a licensing deal for china, extending its distribution agreement with tencent music which has been cooperating with regulators amid the crackdown on technology in china. >> at&t confirmed a blockbuster deal to spin off warner media. it will merge assets ranging from cnn to the food network.

the entity will be valued at $130 billion. the discovery ceo and the at&t ceo spoke with bloomberg. >> john and i are aligned in strategically trying to get the scale above the globe to have -- to be a meaningful scale competitor. to do that, you need great content people love and one of the things we looked at when we launched discovery plus, very strong, great product, great reviews and app ratings. people are using the product for three hours a day. but we looked at what john has, king kong, godzilla, the incredible brand of hbo. game of thrones. superman, batman. we started to think about it as a combustible combination. you have incredible ip people

pay for before they pay for dinner and then we have a bigger lineup than netflix with content people love, whether it is oprah or food network or hg or the bbc content, planet earth. this is just a way that assures warner, probably the top of the pyramid in quality ip and quality talent that is loved around the world, together with the content we have where we are already the largest global media company, we have more global ip than anyone else. when we come together, it makes us a real formidable global ip business to compete with the best in the business. >> you are at least in the same sort of business. you have also had something of a change of heart. there was a strategic decision made to move into the media business as a telephone company.

now you are reversing that. you're going to go back to your roots as a telephone company. was the strategy wrong, or did something change? there is value being destroyed. >> i would dispute whether there is value being destroyed, i would say we managed to increase the value of the assets we bought by about 30% if you look at the cash we have taken out of the business, the assets we sold , the effective value of this transaction and reasonable assumptions as to how it is going to trade at a multiple. >> i think you bought it at $85 billion. are you saying you got the difference out in cash? >> 71% of the equity of the new business. there are two parts to that.

the point of view i would have is the team has done a remarkable job of pivoting the asset to be effective in the direct to consumer world. that is the value i think david and the rest of the industry see right now. what changed since we went into this was originally a point of view that this would help our connectivity business. and indeed, it has. it has helped with customer acquisition selling more broadband connections. it has raised customer satisfaction on those products. but in 2016, i don't think we had a clear picture of what the global opportunity was going to be in direct to consumer and whether that was going to be essential to playing in that space. has become clear it is going to be global. the market opportunity, the value creation opportunity, is significant. >> the discovery ceo and at&t

ceo speaking to bloomberg's david westin. for more insight on that and what it means for competition, we have a bloomberg entertainment reporter. we have seen at&t with new content. what does this mean for the streaming wars? >> one of the three or four companies competing to be number three, netflix and disney are one into, -- one and two, is now going through a restructuring and shift is an strategy. hbo was one of the first major media companies to go over the top and have a service called hbo now in 2015. time warner sold itself to at&t, which led to the creation of hbo max. hbo max had a rocky rollout, but has hit its stride the past few months. it is about to expand all over the world.

the strategy and leadership is changing yet again. it has introduced uncertainty to this company. >> what are the implications for disney, netflix, the competitors? >> it depends a little bit on what discovery choose to do, whether they combine with hbo max, whether they sell some kind of bundled offering. for those companies, they mostly -- they are likely to proceed apace. they are the leaders. this is the effort of somebody trying to catch up. the question is what does it mean for other competitors in their set? does comcast choose to merge with viacomcbs which owns paramount plus? what happens to lions gate? there are smaller players trying to get to the scale of netflix

and disney, of which hbo max is also one. >> tune in to bloomberg radio to hear more and get in-depth analysis of the daybreak team. you can listen on the app or bloomberg radio plus.com. ♪

>> a quick check of the latest business flash headlines softbank vision fund is considering listing a blank check company on the amsterdam stock exchange. it is seeking $300 million from the deal. the spac would target investments in europe's tech industry. softbank has embraced the spac boom with its various arms raising billions of dollars for nine u.s.-listed spac's in the last financial year. square is in early discussions for a 3% to 4% yield on its $2 billion debut jump off sale. it is being talked about in the 3% range while the 10 year charge for the same amount is in the higher 3%-4% range. profits will be used for

corporate purchases which could include acquisitions and capital expenditures. >> we are watching reactions to the ms ci saying it will decide by may 21 about removing several chinese stocks from its indexes. cathay pacific, the travel bubble between hong kong and singapore on hold again. we are watching players that have been cut to neutral at j.p. morgan. bloomberg intelligence seeing slower sales growth in the june quarter for these jewelry players. alibaba is on watch as well with stocks falling out of favor with hedge funds mid the tech crackdown is an china which has tencent in talks to cooperate with regulators. take a look at taiex futures. a bounce of about 2% after the index fell 3% on monday which

has pushed valuations toward about 13.8. let's look at the taiwan open. market coverage continues next. ♪

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>> 9:00 a.m. in beijing and shanghai. i'm tom mackenzie. >> i'm david ingles. we are counting down to the open of trade on the chinese mainland and here in hong kong. a spike in virus cases throughout asia causing concern of the world economic forum, scrapping its highly anticipated meeting in singapore.