haidi: a very good morning, we are counting down to asia's major market opens. sophie: welcome to daybreak asia. our top stories this hour, saudi arabia insisting the alliance must be extended despite opposition from the ua. >> which is sad to me.

sophie: china deals a major blow , regulators remove after the massive ipo. japan's prime minister gets a mix of the tokyo election. it's party winning seats just weeks before the olympics. haidi: let's take a look at how it is starting up at the start of trading. we have data coming through. positive numbers, file numbers picking up, 66.7, we are seeing the improvement. measure still underway and parts of australia. new zealand currently trending up about half a percent there. looking like a muted start to the section after numbers

closing first -- closing for a record high for the seventh straight day. going to the start of trading in japan, about a quarter of 1% there. with a long weekend july 4. prince happened at the moment. a quick look accrued. holding pretty steady in the asian session so far. another round of critical opec talks. they will try to break the stalemate between the saudi's and the uae. sophie: a few days of negotiation between saudi arabia and uae, which is left them without a deal. they don't expect the plan to extend an agreement or curb production beyond 2022 and less there is a higher baseline. >> uae has lost one third of its production capacity.

many other countries have been given production, that is unsustainable. sophie: the saudi energy minister has responded, saying he cannot give to those demands. >> i would emphasize it the whole world versus one country. which is sad to me. >> how concerned are you, if there is no agreement and potentially we could see what we saw last year, which becomes a price for? >> we have an existing agreement. like we had a march. we have an existing agreement.

we will honor that agreement. honoring that agreement, we have to accept it. again, this put lots of people in their comfort zone. check with all those who are participating. in this market. >> agreement, if not extended, has no production increase for august. what happens in august? >> is your chance to have maybe another interview with me tomorrow. >> are you worried we could see a massive spike in prices?

because the market is in need of more supply for the month of august. >> if some people would like to have that they can do that. if it was our intent, why would we do it? it has been a two month affair. >> if you are on board and there is just one holdout next the uae, will you continue to increase with 100,000 barrels a day? without the ua ee on board? >> we cannot. >> does this dispute have the potential to bring an end to opec-plus? >> why should it to.

we did not have an agreement in march. the situation dictated the people should seriously attend to the situation. >> but opec-plus needs a consensus or cannot work. if the uae does not sign up, you say there will not be an agreement but you are also saying this dispute cannot mean the end to opec-plus. this this may potentially we can see an exit by the united arab emirate? >> whatever was completed before, even after signing, they covered have dug their feet on issue like this other sense.

-- ever since. why now? it is an extension of eight months, solid logic behind it. it has been accepted by everybody. sophie: that was the saudi energy ministers speaking exclusively with bloomberg. aaron, will these two sides be able to bridge? erin, can you hear me? it seems that we have lost aaron for now. haidi: we are trying to get back to aaron clark for more analysis as we continue to watch that stalemate. a third round of talks can begin now with opec-plus on monday.

>> japan's ruling government had elections, but the party's failed to -- the ruling party failed to secure a majority. there is a possible general election some point after the olympic games. initially high support crumbled after september, there was criticism in the handling of the coronavirus. the south african president has gathered at his home vowing to resist any arrests attempts after a court agreed to the application to review judgment. he had been sentenced to prison without trial in a ruling that reminded south africans of apartheid rule. in brazil, they have called for the removal of the president

after an investigation into the purchase of coronavirus vaccines from india. it turned into a scandal when a government ally said there was a contract to acquire the 20 million doses plagued with irregularities. at least 49 philippine soldiers survived the crash of a plane and c1 problems. it was carrying 96 people when across. at least 42 army soldiers on board and three civilians on the ground were killed. one of two x u.s. air force crafts were handed over to the philippines. the hackers behind the latest ransomware attack exploited a vulnerability in a management software. the hacker had at least 20 ip service providers and more than 1000 businesses. russia had been accused of watching the attack.

global news 24 hours a day, on-air and on bloomberg quick take, powered by more than 2,700 journalists and analysts in more than 120 countries. this is bloomberg. sophie: asia energy editor aaron clark. must go back to this negotiation is about to take place on monday. we will be able to see a compromise? >> that is the big question. saudi arabia is insisting that opec must extend its production agreement to the next year, sticking to this plan and has hashed out with russia. this is raising the stakes in the standoff with the united arab emirates. the uae says it is in favor of adding oil to the market but says it rejects the plan proposed by saudi arabia and russia.

its own production going significantly higher. without the extension of an agreement, there is a fallback deal in place under which the oil outlet doesn't increase in august. clearly, that would be very bullish for prices but we will have to wait and see. the group is scheduled to meet again later today to try to hash this out. haidi: what are the implications for the market? >> the uae is really forcing its allies into a difficult position. except the request for risk unraveling the opec-plus alliance. failure to reach a deal with the already tight market potentially sending crude prices sharply higher. there is also a more dramatic scenario, unity within the opec group breaking down the top -- if the unity breaks down entirely could unleash a freefall, the repeat of the

crisis we saw last year when the crude market crash and prices turned negative. there is a lot of stake in the ongoing negotiations that will resume again today. haidi: still ahead, the opec-plus with rising prices fanning inflation, plus mandates for the philippines for the philippines fullest conglomerate redoing the focus, planned for later this hour. this generation x. this is bloomberg. ♪

haidi: china security regulars have removed apps -- have ordered app stores to remove. they pulled off one of the largest ipos in the past decade.

a spring in tom mackenzie who joins a set of beijing. what prompted this? tom: quite the turn of events. you cannot find this out. you can download it. as of sunday. they have found with their surprising as a serious violation in the collection and usage of personal data. personal information in these apps. they have ordered into to be taken down. this comes just two days after the cyberspace agency launched a review of the operations. it can't just two days after, and they raised 4.4 billion dollars. the second largest in the u.s. on record. they want to see steps taken to

protect the personal information of their users. at least for the moment, with the fact you cannot download their apps anymore. sophie: how is the company responded? tom: they put out a statement about an hour ago, saying the existing users can still use the service. from july 3, they had already stopped registering new users. they said it may lead to an adverse impact on revenues, taking concrete steps as to rectify some of these issues. but again, this was a company already facing scrutiny over this antitrust probe. one of 34 internet companies in china, rectified problems.

a number of hurdles facing this company. after this major ipo. part of the reason for that, expectation regulatory hurdles, i'm not sure many investors expected this though. haidi: prominent investors coming out and saying how was this allowed to happen? allowing these companies to lift when an investigation is underway. is this an indication that the chinese tech is clearly not over? tom: it is very difficult to get clarity on this. this happened two days after the ipo. the timing is very curious. think about the timing around the ipo -- you have that just days before what was going to be a huge listing again by the financial arm of alibaba. regulators fits questions from

outside, about why they have taken so long to pull the plug on this ipo if they are so worried about it. the second largest chinese company, the scrutiny from the regulation just two days later. regulators have some questions to answer. i'm not sure they are going to feel much pressure. it may, and it does have a warning for international investors, the underwriters including goldman sachs, morgan stanley and jp morgan, will be scratching their heads. sophie: tom mackenzie in beijing, our markets: good there. to get more, bloomberg subscribers can go to their terminal, also in the bloomberg anywhere app. this is bloomberg. ♪ this is bloomberg. ♪

haidi: asia's major market set for a steady open at the top of the hour, after the u.s. hit the second consecutive high. still with a few pockets of opportunity, great to have you with us. evaluations being is rich as they are generally, where you seeing specific opportunities? >> markets have rebounded strong over the last year. we are still trying to identify pockets of opportunity that will benefit from normalization headed for the future -- ahead into the future. a key standout is health care. within the health care space,

there are a couple of driving factors. studies show today, 111 people in the world are over 65 years old. a few years from now, we are looking for that number to double. one in every six people are going to be over 65 years old. there is a huge window of opportunity we should explore that. looking at valuations, health care has been lagging. we look at valuations, the s&p 500 is trading at a discount throughout this year. we come to australia, we are looking at a 30% discount. a great window of opportunity here to position for the long-term. key areas, the telemedicine, as

well as medical technology. haidi: you spoke about australia and we finally see a little bit of a light under australian stocks after stagnant trading. does that continue even with the concerns about virus outbreaks? >> that is a great question. we are smack in the middle of a lockdown. as we have seen in past lockdowns, there have been -- they have been generally short. we haven't seen a significant impact market. a significantly renounce back on reopening. the key risk is the duration of the lockdown we are looking at. clearly, as that continues, the biggest risk we see is that

there is no more job keepers support. a goes on beyond august or september, rigidly, then clearly you will see a large effect on the labor markets. let's see how that goes as well. sophie: as we pointed out and the induction, u.s. stocks have clinched record after record. we have seen the s&p outpaced global peers like in china, hong kong, as well as in japan. earlier you spoke of pockets of opportunity. recently identifying these potential buyers. >> we still like china quite a bit. we can't forget that the size of china is only getting bigger and bigger. would you compare the market cap of the u.s. as opposed to chinese equity market, is around

25% of the u.s. market already and growing. yes, this year china has largely underperformed due to regulatory concerns, sophie: on regulatory concerns, what do you make of the overall uncertainty around regulatory oversight on the tech industry in china? >> from my perspective, the selloff in that tech space has been a little bit overdone. you can't forget the domestic resumption story, we see the pockets of opportunity there. i think it's a great time to position for the long-term. we have this fourth of july, the 100th year celebrating. we don't see significant policy

changes and months going forward, we hope to see stability and policy ahead. from china. sophie: thank you so much for joining us. with get a quick check of the latest business flash headlines. it could become the world's biggest ipo of the year. the fertile letter business -- fertilizer business, meant to sell a 20% stake in the company. acquired for 43 billion dollars in 2017, china's biggest foreign takeover today. sources tell bloomberg there are talks to buy the 51% stake being sold by investment holdings. that stake will cost at least $272 million. currently owning 49%.

hong kong's market operator shuttered its management team. according to a memo seen by bloomberg, it has shifted all of its teams. it will be cowritten in the operation will be overseen. haidi: let's take a look at how asian markets are setting up as we had a u.s. stocks reaching a seventh straight day of record gains. investments seem to pare back expectations of any rush to remove liquidity from those of u.s. payroll numbers. new zealand seen stretching out those gains by 7/10 of 1% and the session. cindy futures looking unchanged at the moment. we may see a 10th of 1% as we get that staggered open in about a half-hour.

the s&p 500 futures holding steady after that. coming up next, japan getting mixed results in the tokyo elections a week before the olympics. this is bloomberg. ics

>> two days of a negotiations between saudi arabia and uae has left without a deal. abu dhabi says plan to extend the groups to curb oil production unless it's giving -- given a baseline. >> the agreement -- we should

kickstart .

chinese president and angela merkel and president mike braun are -- president m --macron. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm up juliet. at this is bloomberg. >> some stories we are watching today. among those french brands facing investigations. local media says it defense meant -- ministry intends to boost personnel.

>> we are still in japan. the ruling failed to score the majority. at some point after the olympic games, what's at start that what's at stake? -- what's at stake? >> a lot is at stake. back in april, the lbp suffered three election losses in a single day. they are shaping up for the general election. this tokyo metro assembly vote sunday could be seen as a referendum and the handling of the pandemic. there have been scandals. the very controversy old olympics.

he's been a staunch supporter of going ahead and handling. no foreign arrivals will come in and see it. election results came in very favorable for him and the lbp. now they have 33. they have gained eight. their new party maintained their position in the tokyo assembly so not quite an outright majority, but they gained some seats. that was founded by the tokyo mayor. that was the biggest loser losing 14 seats. remember in 2017, the party upset the lbp. a little bit of a situation right now. tokyo had supported no

spectators in the stands. >> down to those olympics. japan facing a vaccine crimes. will we see a quiet gain? >> i don't think there could be a delay. we have these quasi-emergency level restrictions. local media is reporting they are likely to be extended. you have the dilemma. you break the quasi-emergency level restrictions. face the prospect of having zero fans in the stands for the big events like track and field, soccer, baseball, as well as the opening and closing ceremonies. these might be the most-watched

olympics on the tv, just not in the stands. getting news that the serbian -- that serbian rowing team member tested positive. he is being isolated along with three other companions. >> three weeks ago before the start of the tokyo olympics. president biden is seen here delivering his remarks on july 4, speaking from the south lawn where he heads -- where he has been hosting guests with burgers and cherry pies. he is expected to talk about the vaccination. he is expected to say that it is far from over. they have fallen just short of getting 70% of americans vaccinated by today. they are at about 67% when it

comes to the number of adults. we are saddened to see the impact of the delta variant as well as some hesitancy and plateauing when it comes to the vaccine effort. we will continue to watch as a president biden continues to deliver remarks at the white house this independence day. we will leave it there, but if you are a limburg subscriber you can get -- bloomberg subscriber you can continue watching. also catch up on any event that you may have missed out on earlier. next, you will hear exclusively about the digital evolution and banking. this is bloomberg. ♪

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>> now to our weekly look. the philippines oldest conglomerate started as a distillery nearly two centuries ago. the company now spans businesses from banking and property to health care and energy. she has taken roles and serves

as vice president of the bank of the philippine islands. the pressures that come along with being a part of a family called generation inc.. >> probably still at about half of pre-covid levels. in terms of the bank, i think we are lucky in that the bank has put quite a bit of emphasis on quality over the years and i think that has paid off. we have been a little more selective in terms of of managing a much better rate. >> pandemic proofing your

businesses. we don't know how long we will be here. we don't know when the next one is going to come created what are your thoughts? >> the pandemic has sped up the digital evolution of many companies. my focus having worked in the consumer space, it really is about how the filipino. while a more discerning consumer is a unique challenge for groups like us and all of our existing businesses have a competitive landscape. i think the competition that it creates. >> what you think the mean -- the main businesses will be? >> my uncle has been quite clear about a mandate to putting

greater emphasis on strategy and ensuring that we are very sharp on the existing core businesses. 20 years is quite a while ahead. over at least the next five years, you are going to see an increased focus on our core businesses. i think that makes perfect sense given the current environment and our strength. where we will be able to differentiate is if we are able to differentiate -- >> you are now -- how did this training program work? >> there was never an exclusive training mostly because professionalized over the last

generation. we rely on executives and i think as a family, we are all in agreement that it would probably be specifically unlikely for one to cover all the skills needed such a diverse set of this this is. there was pretty deliberate exposure. the generation above us moved to try to understand through this exposure what our personal interest and strength lied. those exposure opportunities were a chance to filter for those who were interested in the business. >> from generation seven, how do you keep things together and how do you make sure that as a whole portfolio of companies makes sense? >> we seen a lot of growth and that's over years of continued investment and strategic management even tweaking some

cases. understanding and identifying when a core business, in our case we realized leadership. we realized within, even just within our banking, our real estate and water business, there's a lot of opportunity to unlock farther value. one customer that we are selling to. the past year has helped us reflect more on how we can drive in this new environment. the decisions are drive more focus on our core businesses.

the thrust to drive more synergy. >> i hope you don't mind me using the word privilege because that comes, i imagine with almost a distinct type of pressure. very few people can understand, really. there is a pressure of a professional manager. they might be slightly different . i was wondering if you could share a little of what that's like. what kind of pressure you feel? >> not as explicit as some would think. we have a shared belief, no one gene pool is going to carry all the skill to grow such a diverse business in the right way. we were lie a lot on professional managers that have the right experience and

exposure specific to those industries or practices. i think in a strange way it relieves some pressure. we are really here to find the best people for the job at hand. it doesn't necessarily have to be family. that said, they are people that we really look up to. being able to add value in an environment that is extremely established. i would say come to terms with the benefits of that pressure benefit -- benefits outweigh. even despite how hard i would've worked and even if i had made leaps and bounds, i think the exposure i'm getting here is

quite unique. getting to see a number of different industries. that's something i'm really grateful for and i know it's not , it doesn't come easy to everyone. if that comes with a little bit of pressure to be able to add value, then i'm willing to take it. >> they are speaking exclusively. you can catch generation next 7:40 p.m. eastern time in new york. the world's biggest pension fund making a record return of -- making a record return. the latest from japan at gpi. that's next. this is bloomberg. ♪

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comply with a new law. the register the legislation -- head suspended delivering and shipments will resume as soon as possible. it expects to take a statutory loss when reports earnings. the casino operators as the results have been significantly impacted by the pandemic and will continue to operate in an uncertain environment. restrictions and regulatory issues. >> the world's biggest pension recorded a record return. the investment funds but the gain of 25%. that's about $339 billion. what did the fund have to say when it comes to the record performance? >> obviously, they were happy

with the performance. at the same time, they recognized the fund only returned gains that it got because it was a very unusual year. markets surged both in japan. they described it as a tailwind, but they expected it, going forward they expected that as well. >> the pension fund is seen as a leader. what do they say about investments? >> the gpf brought prominence in japan over the last couple of years. many people have been saying they have gone a little quiet on that front in the past couple of years. they have been less vocal than they normally would. they are putting their money

into esg. they show this once a year opportunity. they get to show how much they have invested and almost doubled to 10 trillion from the previous year. at the same time, they are investing not for the sake of investing but because they expect it to contribute to their returns. >> after that record performance, what's next? >> we don't get that much information. we will have, and about a month, they will be giving their update for the last quarter. that will be the april to june quarter. that comes out in just over a month. we will get another look at

their figures. of course, markets in japan were much less active than they had been in the year we were just talking about. we expect see a much more subdued quarter when they report and all that in early august. -- in early august. >> when it comes to investment and -- when it comes to investment, what kind of proportion will be going forward? >> the gpf investments are split up 25% each in domestic bonds and equities. the fund is obliged. it's portfolio allocation is displayed up there on the screen

right now. the next time that will be reviewed will be in about 2025. a five-year review. one former official told us a couple of weeks ago that one thing that might be on focus is the amount in the portfolio which makes up 25% of the portfolio. >> what do we see when it comes to esg? we have some interesting comments saying investors should be wearing this esp bubble. >> i get the impression that the gps is being -- that the g pif is being cautious. it is a little bit -- it has

become kind of trendy. the g pif is being cautious and saying we are investing for returns, not for the sake of trying to change the world. we are trained to do things with -- we are trying to do things with the investments. >> let's get a quick check on how markets are shaping up. look at kiwi stocks. you are seeing some upside. futures, we have been seeing some downside pressure. above that 1.11 level. after the government you turned -- u-turned plans. so far, about 15.3 million

people in south korea have had their first dose. >> going into the market opened, we will be getting the outlook of j.p. morgan. kerry craig will be with us soon. we will be discussing all of that on -- all of that and more. we do have the market open. after saw -- the u.s. saw seven day record high. lots more to come. this is bloomberg. ♪

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