(woman) aerotrainer makes me want to work out. look at me. it works, 100%. (announcer) find out more at aerotrainer.com. that's aerotrainer.com. ♪ >> good morning and welcome to "daybreak: australia." bitcoins -- elon musk says tesla

didn't sell and cathie wood's says it can still rise to $500,000. >> inflation fears bite concerns over the chinese economy hitting outlook for demand. this is the picture across wall street. we are seeing u.s. futures pressured after markets ended mixed with s&p 500 now down for the third consecutive session. energy and raw materials following the most. oil sinking to a three week low. the 10 year yield jumping to session highs after the fomc minutes. bitcoin, what a wild ride. this after 30% plunge in the morning, a percent surge in the afternoon. nothing concrete, but of course

we had a series of news from tweets from elon musk to a statement. >> a wild ride for a wild day. let's see how asian markets are shaping up. a mixed open on thursday. u.s. stocks dipping. treasuries moving in the wake of the fed minutes. kiwi stocks are up. we get the delivery of the budget today. looking at the nikkei futures, it is up. holding pretty steady, trading lower in hong kong. aussie futures signaling positive futures. fomc is tapering bond purchases.

our editor kathleen is here for more. are they now ready to talk about talking about tapering? >> clearly, they have talked a bit about tapering. i feel like i'm doing a comedy routine here. they wrote at the very end of the minutes, just like a throwaway line. a number of participants suggested that the economy continued to make rapid progress toward the committee's goal, it might be appropriate at some point in upcoming meetings to begin discussing a plan for adjusting the pace of asset purchases. a number of participants, how many? upcoming meetings. this is definitely somewhat different from the boilerplate line you heard. almost every bank president

saying yes we could get there but it's too early to do so. it's too early to talk about. remember the interview that i did recently on the show where they said i don't want to front run -- front run jay powell. another is saying i think we have to do it sooner rather than later. various participants, these numbers are important. they noted it would be sometime until substantial progress is made. on inflation, the fed minutes noted that inflation expectations are still well anchored but they still said they could see strong demand and bottlenecks pushing up prices. also interesting to note, when the fed met they had seen strong march employment meeting almost a million jobs created.

then you have the disappointing 226,000 april jobs. then a big jump in inflation after this meeting. interesting to see how that might have figured and if we knew with these numbers were going to do. shery: we heard from the atlanta fed president. where is he leaning? >> here's what he said. wall street says you need to do it, you are so far pushing back what do you see? here's what he said. >> my job is to look at the data as a comes in. collect as much on the ground intelligence as possible. then make a judgment about where the appropriate stance of policy is. if we see the substantial significant progress that i am advocating that we move our policies tomorrow. >> he also did say that at this

point, he is not ready to taper yet. after all, there still million people unemployed. he wants to see what inflation does. he thinks we are transitioning into a big rebound to push up prices. we won't know until september or maybe until the wintertime. interesting that the president of the st. louis fed said this week if we can see the pandemic getting behind us, there's not going to be any surprising resurgence of the virus, he thinks we can start talk about tapering. you remember when jim bullard was on with us couple of months ago. he said that he sees that point the pandemic being behind us. 75 to 80% of the population is going to be vaccinated in the u.s.. we are getting closer to that. shery: we have breaking news at the moment. the u.s. is saying they will be halting the nord stream 2 to pipeline is a long shot.

this is confirmation that the u.s. has a long shot of halting the pipe. antony blinken has elected to -- sanctions. the waiver does not have a time limit and secretary blinken can resend at his discretion according to the officials. this is the pipeline that would go through germany. it is under construction by russia. now, we are hearing that the secretary has elected to waive those sentients. returning to the fed minutes, our next guest says they have suddenly become important again. now let's discuss the impact. great to have you with us. those concerns about tapering, higher inflation really upsetting those crushing earnings.

from the likes of target and walmart as well. >> absolutely. the market has been acutely attuned to comments and words and descriptions that are used. today, we saw the first sign of thinking about thinking about tapering. the market is looking at that saying ok something is coming. i still think the fed has been consistent in their language saying that interest rates are going to stay at zero until they have confidence in the economy. they acknowledged they are not there yet but they are optimistic about the forward pass. going to continue to see this debate around inflation. you're going to get volatility throughout the summer and were going to be guessing about the fed minutes for the next several months. shery: do you buy into the volatility? do you buy the dip given that the economy seems to be strong this point? >> you have to look at opportunity. with the dip, you are getting facts going down and -- stocks

going down in price. i am encouraged because we came off a strong earnings season. over 85% of the s&p 500 exceeded expectations. we are seeing a lot of strength in the businesses as they come back online. being able to put the contrary pandemic structure behind them. and push that behind, move forward with a good strategy. that is very encouraging. there's growth and a lot of these businesses and when investors move out of something, they oversell it and you might have opportunity to get into something you really like. >> what is your favorite means of inflation hedging at this point? >> for stocks, i like to go back to health care. because it has been so underappreciated in the future spent, if you work covid related, you were ignored.

for the sector that can come back and some homework. it is something that is a little more defensive and with the potential for depreciation, i would see that more as an offset against deflation. with that inflation, you have to be careful. multiple expansion isn't going to happen, it really is about company fundamentals and who's going to exceed expectations. >> i want to throw up this chart which goes on the back of what sherry mentioned about the euphoria in the markets. this is the economic surprised index. it is almost negative. nothing happens if it goes negative. does that tell you that the impetus from further upside from economic upside surprises is starting to wane that the good news is it's fully priced in? >> we are seeing that a little bit. home depot had really impressed

earnings, but people were worried about can this continue? is this as good as it gets and the stock was not as impressive on the move. i do think that a lot of expectations have been forward into the pricing. i don't expect a new york rise as we suffer march of 20 until now in the markets. expectations have been full forward. there expectations that things are going to get back and investors have anticipated this. there's continued room for them preach -- appreciation because rates are still incredibly low. with that, you are looking for alternatives. equities continue to be a good alternative for investment and a good place where people will allocate assets. >> good to have you. let's get you to new york where vonnie quinn has the headlines. >> crypto exchanges view

disruptions caught by heavy trading. coinbase said it was investigating intermittent downtime on its platform. bitcoin plunged 30% wednesday before rallying 35%. benjamin netanyahu says airstrikes in the gaza strip will continue despite calls from president biden to immediately wind down the conflict. he says he is determined to continue military action until plans and security are restored to citizens. they spoke for the fourth time since things broke out between israel and hamas last week. boris johnson discussed

eliminating possible tariffs with australia on. the farmers union has warned that the tariffs on beef and lamb imports could put forth farmers out of business. the top infectious diseases advisor says many people are misinterpreting the mask guidance. anthony found she says some people think this is the removal of a mask mandate for everyone, it is not. he says it's an assurance to people who are vaccinated that they can feel safe whether indoors or outdoors. global news 24 hours a day on air and on bloomberg quicktake. powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. shery: still ahead, the latest on the fight to eliminate covid. up next, we will hear from cathie wood and why she still thinks bitcoin will go to $500,000. this is bloomberg.

♪ ♪ >> let's take a look at the commodities space. it is red across the board. remember gold had been boosted by a weaker u.s. dollar not to mention falling real yields. we had some concerns this session from the fomc minutes that we might see tapering of bond purchases. of course, that could hurt gold which is been used as an inflation hedge. at the rally that is now taking a turn. we are talking about copper dropping the most in seven months. this as we continue to see the inflation concern not to mention demand concerns coming from china as well as the tightening supply concerns that were driving metals higher now

crumbling. iron ore futures down from the record that we saw a couple of days ago. copper touched an all-time high last week. look at bitcoin, because we are seeing the wild ride continue. we saw a 30% plunge in the morning session. 30% rise in the afternoon. we are slightly higher on today basis. this is unexplained, because there is no clear reason why this is happening and these swings have caused outages at major exchanges. we have elon musk tweets and pboc statement. the wild ride is continuing. >> of course, a major voice in the argument. cathie wood back in april, she predicted bitcoin would go to $500,000. earlier, she spoke with bloomberg again about whether he could get to that level and what is driving the wild ride. >> i think what is happening

right now is because the stock market, the volatile part of the stock market, the innovation part has come to such a correction. the correlations among volatile assets are going to one right now and that's including bitcoin. >> in april you told dow jones that could go to $5,000. you still hold that target? >> we do. our crypto analyst, we go through soul-searching times like this and scrape the models and our conviction is as high. the one thing that has changed here however is the environmental concerns around bitcoin in particular have caused people like elon musk pull away and say let me make sure i understand this.

we believe that even this is going to change because first of all, right now the percentage of bitcoin mind with renewables and hydroelectric power is quite substantial. in china, it is over 50% in renewables. we also believe and we wrote a paper in conjunction with square on this. we are going to have a conference about it in july. we believe that bitcoin mining integrated into the distributed grid and by that i mean solar roofs, power walls and homes, utilities merchant power producers starting to include bitcoin mining in the ecosystem, why would they do that? they would do it because renewables are intermittent power sources. whether, it is sunny or not. wind is it windy or not.

bitcoin mining could take off if there's excess energy from solar being loaded into power walls. it could be offloaded into bitcoin mining and the whole ecosystem becomes much more economic. if this happens, we believe that the adoption of solar is going to accelerate dramatically. there's another profit center associated with it. bitcoin mining. >> what happens in the meantime? here we are at early 5000. you think we go lower from here? >> you never know how low as low when a market gets emotional. a lot of traders see bitcoin dropping below the 200 day moving average, which was at 40,000. traders once that happened, they don't. they dump and run. we are in a capitulation phase.

we were looking at the indicators this morning. they are all suggesting that we are in the capitulation phase, which is great time to buy, no matter what the asset is. the capitulation phase is buying. am i saying that 35,000 is the low? traders, there are a lot of speculators and bitcoin. if they are running for the hills because bitcoin has broken through a moving average that is important to them, it could continue but all of our indicators are saying this is capitulation right now. these metrics are more a measure of are we in a truly competes relation -- capitulation phase? this is the only asset where you can see exactly who is doing what when why and how.

all of this metrics are saying this is a capitulation. this is as bad as it got during the coronavirus crisis. >> that was cathie wood speaking with carol massar. you can get more on bitcoins wild ride on today's edition of debris. -- daybreak. >> later, leaders from the hong kong conference. this is bloomberg. ♪

haidi: looking ahead for australia. the labor recovery seems to have ground to a halt. boris johnson has left the door ajar to a trade deal with food with australia. we will hear from qantas on its financial performance. a soyuz jobs numbers for april are expected to show that the labor market is back to where it began. paul allen joins us now with more. we should see the full impact of the removal of the job keeper program. >> april was a big month. the subsidies got removed. we can see the on employment rate is expected to stay steady at 5.6%. that is back to where we were before the covid outbreak. the treasury last week forecast a loss of jobs.

that's a huge improvement on the same prediction six months ago which thought around this time we would have up to 150,000 jobs lost. instead, we have another chart to show you that shows 20,000 jobs being created in the month of april. job numbers are key from the rba. that was sparked wages growth and inflation. in july, we have a pivotal meeting when there is expected to be a conversation about whether or not to move the three year yield target to november 2024 bond instead of april. shery: the government unveiling its budget later today. what do we expect? >> the deficit is not expected to be as bad as expected. the treasury in new zealand updated its forecast a couple of

weeks ago. it's less than half of the $6.7 billion that was previously projected. net debt, dobbs recovery, all of that is expected to be better than originally forecast in new zealand. the finance minister is remaining cautious on these numbers. he says we have to be careful about what the treasury accounts say. he is expected to remain cautious in the budget. the government has already had criticism this month for freezing public sector wages. in terms of some announcements that we already know, traditionally things eke out. there will be money for vaccines in the rollout. $2.7 billion to address supply in the housing market which has been running away in new zealand as well. a plan to electrify the public sector partially. for the rest, we will have to wait and see. shery: we will get more on the job market later.

we will also hear from new zealand's finance minister about their latest budget. this is bloomberg. ♪

♪ you're watching daybreak australia. president joe biden says the u.s. must defend open feelings. he made the comments during his first commencement address as president. the u.s. is criticized china for expanding its presence in the south china sea. >> whether that's the south

china sea, the arabian gulf, and increasingly the arctic. of vital interest to american foreign policy secured unimpeded flow of global commerce. >> the eu has endorsed quarantine free travel for vaccinated tourists and visitors from countries it has designated as covid low risk. that paves the way for transatlantic flights. boris johnson reinforced -- britain's need to comply with the guidelines when making travel plans. >> you should not be going to an amber list country except on extreme circumstance.

you should not be going to a country on holiday. we will enforce the 10 day quarantine and if you break the rules you face substantial fines. >> malaysia reported a record number of covid infections for a single day. more than 6000 infections were reported even after the government imposed nationwide restrictions on movement to curb the spread. daily cases top 4000 for the first time since february. less than 3% of the population is fully vaccinated. global news 24 hours a day on air and on bloomberg quicktake. powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. ♪ shery: the vaccination rate in

hong kong is lagging. despite the free vaccination rollout. >> fewer than 15% of people have had their covert shots in hong kong. it has the business community worry. -- worried. >> hong kong can fall behind if it doesn't do that as well. >> quarantine measures are among the strictest in the world. it is seen as a major issue for ex-pats who have gone months or years without seeing loved ones. >> it becomes a factor in mood and people start to wonder if they're going to be stuck here and whether it is actually worth it. >> a relocation agency is recording fewer international arrivals. >> we are almost 60% down and that is very dramatic. >> prompting calls for more guidance from government. >> could we have an idea of how

you're going to open up again and not haphazard planning because it makes it distrustful and more difficult. >> you need to pronounce a clear pathway to open borders. >> wish that they would move on a little to relaxing a little bit more a little bit faster. >> some criticized rules for being inconsistent. >> there are still a lot of gaps today. >> there? over whether business should start staff vaccinations. >> it is required to do their business. they may be able to push the envelope a little bit further. of course, western companies will value individual rights. >> i would like to see a better to cup. i am a little bit reluctant to cross that line into saying businesses should do it.

they have genuine concerns. >> after a tough few years, vaccine hesitancy is complicating the path forward. >> in the next half year or one year, the pandemic will be up and down. government policy is not there yet. >> we could have a situation where private bankers and asset managers running ipo's want to be in singapore rather than hong kong. >> there is going to become a shortage of labor and for certain specialized rules. i think it will start to happen. >> we're going to see a continuing of this inflection point. people are going to question where is hong kong going. shery: few places around the world have effectively managed to keep covid-19 out of their borders. will zero havens find reopening

harder than tamping the virus? i am joined by a professor of public health in new zealand. great to have you with us. we see places like new zealand, australia, singapore lauded for their handling of the pandemic. are things getting harder as country start to reopen and borders we don't think will be open until 2022 or even 2023? >> greetings. i don't think this is a problem at all. for countries like new zealand and australia. covid elimination his. eliminating the whole population

starting with the border workers, they have all taken a bit longer because the requirements of that nation are not as urgent. people are not dying every day here. it does mean the vaccine is more available for countries who are left for death at the moment. basically, it is quite sound position. practically, is working well. new zealand and australia opened up quarantine free travel between us and we will reopen in the future as we vaccinate our populations. haidi: does the levels of vaccine hesitancy i saw a recent study saying that up to one third of people surveyed saying that they are unwilling or uncomfortable with taking a vaccine. does that in addition to the vaccine arbitrage i don't want this one i want that one doesn't have the risk of blood clots, does that concern you? >> i am not particularly concerned about that. we will see this go down as the vaccine rollout continues. i think the problem around the

globe, but i don't think it's going to be more of a problem in countries that have had very low covid-19 disease. >> here in the u.s., they are already seeing mask mandates even indoors being dropped. we are seeing employees socializing fully vaccinated. is there a risk that we could see a spike to weeks later because of vaccine hesitancy, there are still so many unvaccinated people out there? >> absolutely. any country in the world if you haven't achieved the immunity threshold of 50% or so, you will see outbreaks. obviously, the frequency will drop off as coverage rises. one of the problems is having pockets of the population with low coverage.

it will be like measles. most of the world has adopted elimination approaches and these are working very well. it's not unreasonable to say now that we have vaccine elimination of covid-19, can we extend it across the globe? this may turn out to be the optimal approach for this virus. we don't have enough knowledge about that yet. shery: how long would that take? >> if you look at how long it took for a number of diseases, it is many years to achieve that. the benefits of having that goal is that we start to live in countries that don't have circulating virus as we do for much of the western pacific region now is living in countries that don't have circulating measles or rubella is saving tens of thousands of lives. with covid-19, we don't know how serious this illness is. young people as well.

the idea that we should just accept that this will become an endemic infection has to be questioned. what we will see is across the high income countries that are rolling out comprehensive vaccine programs, plus probably requirements for travel that you have a vaccine certificate, this may become a disease that we don't have to live with. i am always concerned if people rejected the idea that elimination should still be a good target. it is protecting around 20% of the world's population now largely based on public health measures with additional vaccines it would just get easier. we could see much of the western or asian-pacific region could transition quite smoothly to ongoing elimination with the use of vaccines. >> the idea that we are not safe until everyone is safe is a major one across the medical community.

to what extent do hosting events like the olympics take us a step away from getting to the ultimate goal of global elimination? >> it is absurd to have the olympics in the middle of a pandemic. every scientist who has looked at that and many people in the health care sector and the majority of people say this is ridiculous. an event that involves mass international travel, mass gatherings in the middle of a pandemic makes no sense. it could be different if japan had very good control of the pandemic, but they are having a severe fourth wave. it could put additional pressure on their facilities. in addition, as you say, this amplifies global inequality. that's exactly the opposite of what the spirit of the olympics is all about. >> when you take a look at the vaccine efforts in the u.s., the next step is to get teenagers and children vaccinated. to what extent is this the last

missing puzzle piece in getting to that goal? >> you are absolute right. achieving the herd immunity threshold does mean vaccinating children as well. just to give you enough vaccinated people to interrupt transmission. now, the evidence is coming through showing the vaccine is safe and effective. hopefully, we will get the same evidence for younger children then we can look at vaccinating the entire population. there will be some people who won't get vaccinated, but i think it will make it that much easier to get to that threshold of 70% that we can start eliminate transmission across large areas of the world. the huge challenge is protecting low and middle income countries that are currently not vaccinated. shery: thank you very much for

joining us. up next, tencent is out to prove its best place with a storm of antitrust scrutiny from chinese regulators. wiped off $200 billion from its value. this is bloomberg.

>> after the crypto exchange plunged to a low. analysts say coinbase's business model is more resilient than many things with only around 2% of revenues peg directly to asset prices. more monetization for the company's ancillary products and services. meanwhile, in the u.s. session after results be expectations. they say there is pretty room to run yet when it comes to shareprice. tencent will likely try to portray confidence and regulatory compliance when it

delivers quarterly results after the market close in hong kong. it left about $200 billion since january on the concerns that tencent may be signaled out in a similar way to alibaba all part of beijing's antitrust drive. we have been covering this out of hong kong. what are we looking out for in the set of numbers? >> the numbers should be ok. tencent is caught in the vortex between regulatory threat and reality. the reality is unlike alibaba, tencent has yet to really feel the full brunt of beijing's regulatory scrutiny. that doesn't mean it's going to happen, but it hasn't happened yet. tencent has and its affiliates have been fined, but they have not fallen under the complete crackdown like alibaba has especially with its fintech arm

and that is what his weight on the shares that you saw over the last four months losing about 20% since january 25. again, there is the concern that there could be regulatory action on fintech arm whether it is wechat pay or we bank their overall fintech arm is going to face that kind of scrutiny. already, we heard yesterday from executives of their music business saying we are under regulatory scrutiny, but they would not comment further on that. there is scrutiny, but is that going to lead to a crackdown? so far, the company is doing well and that is what we are likely to see in the results that we will get after the markets close today. believe me, a big pop in revenue and operating profit could go a long way in helping assuage some of the fears that investors have. look at these analyst calls.

63 buys. three holds. zero cell. this stock was 766. now it is 607. analysts basically saying if there is no regulatory concern, tencent is very attractive in terms of valuation. it is a defensive play within the tech sector since they don't burn cash for their core businesses like alibaba and others. it is stuck right now under the threat of regulatory action and the reality that tencent is a giant in social media, a dominant leader in music and gaming online. shery: another giant out with results. what stood out? >> it was a good set of numbers

for them. our margins going to be crypto bit on offer -- because of alibaba. alibaba and their latest results last week said they are going to plow all incremental profits into new businesses. yes, they are a regular soy threat for jd.com and the agreements that it has for its merchants. however, less of a threat for jd.com than what we saw with alibaba but the threat is still there. sales beat analyst estimates. revenue jumping considerably. net income more than tripled again there was a low base effect because of the shopping declines in the calendar first quarter because of the pandemic. however, a good set of numbers.

going forward is how are you going to keep this sustained buying trend online which already this year retail sales in china are expected to generate about half of those from online shopping and that benefits the like of alibaba and jd.com. >> if you want more context and analysis on china's crackdown on tech companies, watch our special on the bloomberg technology channel. take a look at after hours trading for cisco. they reported after the bell and they were hit by the global chip shortage. they had to pay more for chips to fill orders. the company falling right now. they had said the higher cost for components and rising demand will erode profitability. this is weighing on the stock even after they gave an upbeat revenue forecast bolstered by rebound in corporate spending. discuss the chip shortage

because they are now approaching the danger zone. this as wait times reached new records. let's discuss with our intelligence senior analyst. how bad is it? >> it is pervasive. we get a lot of noise from the auto industry on the chip shortage, but the truth is that the auto industry is only 10% of semi conductor condition -- demand and the chip shortage is widespread. it's not restricted to any one market or any one kind of chip. you are going to see a variety of chips be crimped and the chip shortage is not directly tied to the value of the chip. it isn't the high-end logic processors made for apple that are in short supply, although we did see some qualcomm processors be crimped. it is also the one dollar

display driver that is on every tv screen that requires the chip to power the screen. you have a variety of chips and unfortunately, these products these chips go into a variety of product. you cannot ship the end product unless you have the chips. the old adage is for want of a window or part kingdom is lost. for a one dollar part, you cannot ship a $1000 good. that is going to stay through most of the year. >> are we seeing an element of panic buying or panic behavior amongst customers as well? is that complicating the demand side of the picture? >> that's a great question. the reality is we don't know. we are certainly seeing elevated orders. disproportionately more so, but how much of that is advanced ordering, how much of it is true

demand? it is hard to shift -- sift through that. it's very hard to tell how much of that is real demand. from a stock-price perspective, the bulk of that is real demand but a portion of it is double ordering or triple ordering is going to create an inventory problem come the end of the year. >> that was a senior analyst. the u.s. house of representatives has backed a commission to probe the january 6 attack on the u.s. capitol. the commission will have 10 members and it will be tasked with investigating events surrounding the rate of the capital on june 6 including the influencing factors and law enforcement preparedness. it would report its findings and recommendations to the president and congress by december 31.

republicans joining emma kratz in favor of forming this independent commission modeled after the set -- september 11 attacks. haidi: qantas just released an update saying what is driving their strong cash generation. jet stars underlying positive and april. they expected -- liquidity position is strong as well. net debt has peaked and it is starting to come down. they are forecasting a loss of more than 2 billion for the full year 2021 saying that the loyalty program is returning to earnings growth in the second half of this year. a phased return of international flying from late december on

work, that is a much more optimistic projection that we are hearing from the australian government which is saying that borders won't meaningfully reopen until the middle of 2022. the government is aiming to get the full population vaccinated by the end of this year. qantas has had to continually push back its expectations. shery: take a look at the markets right now. we are seeing qe stocks recouping the loss we have seen in the few sessions. sydney futures are slightly higher. the aussie dollar continues to be pressured ahead of jobs numbers. we get the april on employment rate coming it. the recovery is most likely to hold it because of the temporary measures being unwound. we are seeing nikkei futures unchanged at the moment after we saw the worst day for the nikkei

in about a week. the japanese yen weakened slightly after significant gains against the u.s. dollar. we saw machine orders out of japan so watch out for that. japan futures -- it was the third session of losses. we continue to see concerns over inflation and perhaps the fed tapering bond purchases. look at the commodities. we are seeing not a lot of movement or oil, but you have seen gold falling from the or month high on concerns about early tapering from the fed. we have seen negative real yields helping gold futures not anymore. copper dropping the most and seven months. this on inflation concerns as well. coming up, we will cover the markets. we will also get the outlook with the ceo of freelancer.

daybreak: asia is next. this is bloomberg. ♪

>> good morning, we are counting down to asia's major market. shery: asian stocks set for a next open after the fed's april meeting reveal some for officials opening the door to paper talks. elon musk says tesla did not sell