welcome to daybreak: asia. i am haidi stroud-watts in sydney. sophie: we are counting down to asia's measure market -- major market opens. shery: asian traders worry about tapering as u.s. stocks fall from records and commodities slumped. investors awaiting news on a softbank buyback.

scientists issue a regular global heating. we look at the role that hydrogen can play in avoiding climate catastrophe. we are watching u.s. treasury yields. we saw them shoot up and get past that 1.3%, 200 day moving average. this on comments from the atlanta fed resident on faster tapering. he is talking about moving to taper asset purchases after another strong month. all of the focus on when that tapering timeline will really take shape. >> when you take a look at the performers, these vaccine makers, the drugmakers like moderna, beyond tech -- biontech. i think biontech was on track for one of its highest quarters we have seen. this as we get enthusiasm and

expectations they will be boosters. >> no wonder they jumped as much as 18%. an interesting day when tech is not driving markets but vaccine makers. bitcoin, what is happening with those crypto amendments in the infrastructure bill? it seems that those changes were blocked. that may not bode well for the crypto industry but we will see. >> let's look at how we are setting up the start of trading. we will get into this with sophie kamaruddin. it seems like a drifting session going into the start of trading. quite a lot of digestion here in asia. drifting is likely the theme for the stocks. a little chance to the upside. we also anticipate softbank

group earnings. we are likely to see some pressure on asian stocks after we sell u.s. equity and saw some record highs with commodity among the biggest laggards. we have seen a pickup in australian yields. they say the aussie yield is pricing a dour outlook with the rba cemented state accommodative given the backdrop of these virus outbreaks in australia. the dollar is holding gains as they are tapering. they are expecting a recovery cycle. that will likely be a headwind for emerging currencies. they are grappling with this, when the window for using this comes on. haidi: let's get to vonnie quinn with the first word headlines.

courts thank you. the passage of a massive $550 billion infrastructure bill. cryptocurrency reporting the blueprints being blocked. that means the original language will remain. something that has been done by the cryptocurrency and investors. divided in administration back to the compromise. one of joe biden's top foreign-policy priorities, returning to the iran nuclear deal is looking less and less feasible. u.s. officials are reviewing their options after months of talks. meanwhile, tehran is finding ways to cope with harsh u.s. sanctions. the nuclear program is advancing. bloomberg news has learned the european union will not reimpose restrictions on non-essential travel from the united states. this despite new covered cases exceeding threshold. new infections have risen to about 270 per 100,000.

the limit is 75. the eu got its is a record edition that ultimately -- the number of airline seats being offered in china have dropped the most since the beginning of the pandemic. rising cases of the delta variant have spurred fresh travel restrictions. aviation data shows capacity plunged 32% in one week, hastening a decline that started in july. the outbreak has impacted over half of china's provinces. global news, 24 hours a day on air and on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. shery: concerns growing about a pullback in u.s. stimulus. rafael bostic says the central bank should consider beginning tapering after another month or two of job scans.

bill dudley says he sees less chance of a taper tantrum this time. >> i think the risk of a tantrum this time is less because people understand the game plan. first we taper and then we raise short-term rates and then we start to let the balance street -- balance sheet strength. >> he is buying into our exposure to equities. let's bring in the ceo. great to have you back. with the correction come in the form of another taper tantrum given what the fed will do and how big could it be? >> we never know what will cause the next correction in the market. we know it has been a while since we saw any pullback of 5% or more. especially given the huge run-up we have seen year-to-date in the markets without any pullback so far this year.

i would expect that to happen before the end of the year. investors should be prepared for it. >> we are showing that we have not seen that sort of pullback in a long time of more than 5%. where would you buy into if you were to jump into a correction? >> one of the things we are seeing is we were in midcycle. the early-stage recovery to more midcycle. that time of the cycle, communication services can do well because companies can advertise more. there is more advertisement going on. we like this area of communication services. >> what are you concerned about in terms of the wage growth story? there are sectors that you see outsized in terms of cost? ? we will see labor unit cost and we will see how that unfolds but i think we are seeing quite a bit of wage increasing.

we will see if that is necessary for company -- companies to give to get people to come back to work. there are 10 million job openings in the united states. small businesses are having a hard time hiring people. i expect to hear that small businesses continue to have a hard time hiring people. with that, i expect to see wage increases adding some pressure. i would also expect that is going to be passed along to the consumer. the consumer has been willing to take on added cost. >> i am reading through your notes when it comes to vaccination. it is a twofold story. you have been encouraged by opportunities as vaccinations have accelerated. on the other hand i know you are worried that there is plateauing when it comes to vaccinations and it could result in further mandates and more lockdowns.

>> it is always a potential we need to watch out for. especially as we hear about the delta variant continue to increase. we just heard about china and the travel dropping. it makes people nervous. as companies try to reopen but now they are saying don't come back to the office for a while still. it is pushing out it continued recovery. what we are experiencing right now is a pause in the recovery that will continue. with that, investors should expect some volatility in the markets. this as they said -- as they sort out what the fed will do and the delta variant. ultimately, we are still in recovery. >> always great to have you with us. let's take a look at the commodity story. that has been one of the big market stories of the week so far. quite after the steep losses we saw, we are seeing prices steady

early in the asian session. this is trading at near a three week low. check out gold spa prices steady and today. they saw a six dollar drop. they saw the bloomberg commodities spot. they notched the biggest drop since july. we will keep our eye on the base metal. this is putting fossil fuels very much in the crosshairs. only six of the 29 base metals they track have the carbonization targets meeting climate goals. >> still ahead, we preview

softbank earnings along with other japanese firms with our senior strategist. up next, the pboc speaking to its policy. they think the pressures in the economy are controllable. this is bloomberg. ♪

>> investors have not taken into account the market risk inherent in china. in an inclusive interview, the chief also on the rise of the retail trade off. >> when you have passive buyers, it does not create a linear upward effect on stock prices, it creates a convex upward impact on stock prices.

they call to create these gamma squeezes and you just get this crazy disconnect in a number of stocks between the actual economic fundamentals and what the stock prices are doing. the saving grace for people such as myself when it comes to meme stocks, they tune into where retail traders are talking things up. we don't have so much capital that we can't get out of the way. i am not so much worried about that. it is the distortion of passive buying on a lot of crab companies and sometimes abject fraud from china. to me, that is the more disturbing issue. >> how do you engage with this and make money?

do you stay away altogether? you said they are advertising what they are going to do and you can play with that. how? >> we are not playing long squeezes on meme stocks. a good example of how we utilize this is xl fleet. that is a company that we shorted earlier this year. it is close to an empty box in our view. the stock had gone down and we made money on it. we are very quick to pull the trigger on getting out of something if we have to. we saw a retail traders talking it up. there's -- there was a bunch of buying call options. it turns out the stock did not squeeze. better safe than sorry. that is how we are utilizing it. we run the book very market neutral. we are going long to hedge it and going long rather than in

disease. we have factor baskets. we have tiny long positions that we think will explain most of the data there. that is how we changed our business to keep up with the times. >> there is also this concern you could have meme traders in the united states and in china you could have massive policy shift that would change entire industries. we saw that with the semiconductors today. we have also seen this with milk formula and other areas. how do you get a sense of what next area they might be targeting could be? does it make it nearly on investable for you -- uninve stable for you? >> it can't be predicted. i think investors for the past decade were pulling the wool

over their own eyes on the capriciousness of the environment in china. that is coming home to bite a number of investors. it is one of many risks you really need to take into account but investors have not. it is another reason why all other things being equal, a china stock should trade at a significant discount relative to a stock for a comedy based in the u.s.. often we found they don't because investors like to tell themselves these fairytales about -- there is a tremendous cognitive dissonance. investors will say do you know what is growing really quickly? we think the real gdp growth will be 7% this year. i say you know that is not real data. you know there is inaccuracy and lying embedded in that and that nobody takes that seriously. >> that was carson in an

exclusive interview with lisa. the pboc admitted it is marching to the beat of its own drummer when it comes to policy this year. kathleen hays is here with more. we are hearing from them there will be no need for the pboc to inject more open market operation funds. >> yesterday, the pboc came out with a fairly dovish policy statement. this is after the ppi came in at 9% year over year instead of 8.8. not a big difference. it is still rising. is the pboc worried? later in the day, when they put out there policy statement, look at what they said. they set concern in the ppi will be temporary.

inflation pressures are controllable because they have been normalizing their policy since may of 2020. ahead of the curve. they went out changing their policy ahead of everyone else. they said to mastic recovery is not yet solid. they say they expect export growth as well. we saw that yesterday. the delta variant spreading. also, small businesses have been hit by the rising commodity prices pushing up inflation. after this dovish policy statement, it seems to be increasing. let's look at the bloomberg terminal chart. this is the key rate the pboc cut, the government cut back in july. it was a surprise. you see for the big banks and small banks still at the lowest they have been in several years. jp morgan saying yesterday they expect to more cuts, one in october, one in january and possibly small cuts in the

medium-term. very dovish. i love watching central banks and i think the pboc is getting very interesting right now. >> i love how they used all these different words for whether the pboc was temporary, whether the fed was transitory. >> that was kathleen hays with the latest on the pboc. coming up next, what do you do after losing $20 billion? the answer seems to be to lie low. -- fly in new jersey. we will have more on that next. this is bloomberg. ♪

>> lying low in new jersey.

what happens next? what is he doing right now? our goal was to try to find out what he is up to. it has been four months since the collapse. even now, bankers, regulators are sifting through the records to figure out exactly what happened. we had a brief conversation with him. he is currently lying low in suburban new jersey. not too far out of midtown manhattan. obviously he would not discuss what is happening and what really went wrong.

you have so much chaos around them. the landlord is changing them. former employees getting wiped out. some pointing fingers. they just came out with this damming autopsy. a lot of them said their systems were not up to the market in terms of human interaction and people keeping each other in the loop and finding the fixes but they also publicly set for the first time that they likely deceived the banks. there are a lot more things to play out in the situation. it has clearly been a long, hot summer for bill long. >> what about his own personal

wealth? sridhar: that is at the heart of all of this. we don't have up her size answer yet. what we know from our previous reporting is that this would have been bill's personal fortune starting at 23 billion. he has put much lost it all. but he has also been a successful investor for a long time. he had a hedge fund that went up to about 10 million in assets. he has made private investments elsewhere. his former employees have talked about the fact that they believe he is still possibly quite well. we saw talks about $2 million in

excess margins for the crash and whether he used that money to plow into more or if that is him taking chips off the table. in the next few months, we are hoping that picture will become a little bit more clear. >> a great in-depth story. here is a quick check of the latest business flash headlines. jp morgan has raised the stakes in the intensifying battle. extending a pay increase and including more staff. research analysts will now get raises. junior banking pay is getting hiked up to $210,000. hsbc says they have attracted $9.3 billion. client assets rising 25% in the

first half. meanwhile, they have reached a record of 810 billion dollars, accounting for nearly half of the global total. hsbc wants to expand in asia, particularly china, hiring new wealth planners in the region over the next 3-5 years. amc entertainment posted our losses -- more never losses than expected. even as the movie industry struggles to draw fans back into seven a -- cinema. revenue soared to almost $445 million. the world's largest theater chain says customers are returning after the entire industry shutdown down last year. coming up next, we will speak with the senior strategist about major japanese names reporting today. that includes softbank and how the china exposure will come into play.

this is bloomberg. ♪

>> we are counting down to the start of trading. tokyo and seoul. korean stories. game developer craft raising nearly $4 billion in its ipo. this company is backed by tencent. we hear that the emaar online mall is hiring rangers. as indy.com will complete its listing as early as next year. south korea is beginning limit airy training with the u.s. ahead of next week.

military exercises. we will be watching that shortly. that always raises more tension with north korea as well. in japan, reporting to ask for stimulus packages. local media reporting he wants to use funds from a budget of nearly ¥30 trillion. we are watching current account data. plenty of earnings on the radar. among the names are bridgestone, keating and softbank. >> it will be hard to ignore the exposure to china's regular tory crackdown. we will look at the other japanese companies reporting. always great to have you with us. let's start off with softbank to get it out of the way. is the inscrutability of their portfolio a key concern for investors? >> softbank has become a black

box. it is just impossible to know what the earnings are. even more fascinating is the fact that the earnings are completely detached or the share price reaction to earnings is completely detached to what the reports are on a quarterly basis. it really doesn't matter. people really want to see a buyback. that is the only thing that is left to keep the share price. they are going to push the share price up like they were so lost. again, given what has been going on in the ipo market and how strong technology has been, that big discount they have been hoping to close, it is not closing, it is widening.

we consider softbank as not being investable. we do hold softbank in a portfolio. this is a big component of the index. they are mostly neutral. it is a really tough one to gauge and analyze. >> yes. we would expect the picture to worsen given the timing of the regular tory crackdown given all of this. what would make it investable? >> his ability. this is the chief investment officer as well as ceo. he decides what they buy. not long ago, they were moving them into the options market as you probably for member.

in and out of different asset classes. they just don't have any visibility. despite the fact that all analysts have a buy recognition on the name for different reasons, it is one big black box. you have no certainty or confidence to go in there and recommend the name. >> let me talking about nintendo and sony. that procurement has been an issue with some of their hardware production. where do you stand on these two companies? we have been short both stocks. we shorted again when the q3

results were out. i think these shortages are only a small problem. the year on year growth titles is the big issue. particularly for nintendo whose console gaming has been aging quite rapidly. we thought the consul peaked -- console the year before last. the pandemic give us a big shot in the arm. i think nintendo will struggle for the whole year. by the end of this year, the console will be even more aged. it will have a really big problem. sony is a different issue.

we think the royalty fees are charging at 30% like apple is going to come under pressure. that will put a big dent on the part of sony. >> let me turn to a stock you seem to be bullish about. rakuten. this is what he had to say about the other for his business, especially now. >> the rest of the market is going to be somewhere between 100 billion and $150 billion in the next two years. >> why do you like this company so much? >> it is not because of its open-mindedness. that could potentially grow. we are very bullish on rakuten as it comes to the end of its big spending on its mobile, structure.

we love the synergy between the businesses and the cross-selling. they were pointing out that mobile subscribers were spending 50% more on an e-commerce business. most importantly, something most people are not talking about, they are dealing with 51% of the assets dealing with the logistics. we think the cost of that business is going to come down as profit margins will improve quite fast from july onward. it is a very unloved name. we think it is going to be a big recovery. >> great to have your insight. you can turn to your bloomberg for more on softbank's earnings p. you can get commentary and

analysis from our expert editors. 3:00 p.m. in tokyo. coming up next, scientist issue a red alert on global heating. how hydrogen can play a role in avoiding a climate catastrophe. we will explore that next. this is bloomberg. ♪

>> this is daybreak asia. i am vonnie quinn with the first would headlines. sydney is in its seventh week of lockdown. several states have imposed restrictions as the virus spreads beyond major cities. china has punished dozens of local officials for failing to curb an outbreak of covid infection. authorities in wuhan found nine cases after mass testing. more than 11 million people in the original epicenter of the pandemic. china's former health chief says the idea of living with the virus is on acceptable. samsung vice chairman will be released from prison on friday after i justice committee

recommended he receive parole. they reached the decision after considering his behavior while incarcerated. the 53-year-old is in jail for a second time in january after being convicted of bribery to win support for succession at samsung. this prominent lawyer has resigned from this charity after it was said that she advised andrew cuomo on how to respond to sexual harassment claims. her resignation comes a day after the governor's top aide also stepped down. , denies the conduct. global news, 24 hours a day on air and on bloomberg quicktake, powered by 2700 journalists and analysts. this is bloomberg. haidi: let's take a look at the

headlines with sophie. sophie: trading near a two-week low in the face of dollar strength and markets. we are seeing some downside pressure for the aussie dollar as well. this has also triggered commodity price weakness. we are seeing oil and gold prices studying this morning but i futures are extending. china's efforts to rein in its geo sector are taking effect. the country is looking to lower its output to meet emission targets set up by the government. pulling up this next element here, they responded to the icc reports. only six of 29 that they tracked me the carbonization goals, including this. this debt a carbon neutrality target by 2030. they are targeting that goal by 2050. analysts at bloomberg say that

suggest a positive long-term transition. the bsu research team suggesting these countries have more immediate chemicals, noting the utilities for fossil fuel replacement. >> let's get a bit more on that report from the world top climate scientists. the yuan intergovernmental panel on climate change warning that the planet will heat up by 1.5 degrees celsius in the next two decades without taking drastic action. clean hydrogen may be a solution. let's bring in our global nes analyst. will we see enough growth in the area to provide any meaningful change? >> we have seen a lot of growth in the clean hydrogen market this year. we have seen massive growth in put clem bish and's. over 40 countries have a hydrogen strategy or developing one. we are expecting big growth in the deployment of devices that produce hydrogen from water and

electricity. we are expecting 400 megawatts this year compared to 200 megawatts last year. finally and most importantly, we are seeing demand project being announced to that would be using this clean hydrogen. we counted over nine large industrial facilities. they plan to use hydrogen to de-carbonized. both of these numbers are almost double what we counted in january of this year. we still have five months to go before the year ends. >> in which markets are you seeing the most activity? >> china has been the biggest surprise for us. there was very little happening on hydrogen in china. china is leaving the hydrogen market. the reason is the 2060 carbon neutrality goal. now large industrial companies

in china are setting even more aggressive decarbonization targets for themselves and many of these targets include the use of hydrogen. some of these companies are very massive. this is one of the largest oil refineries. finally, europe is also seeing all of the activity because of subsidies, rising carbon prices. that was not really a surprise as much as a continuation of a trend. >> how do you expect this hydrogen market to evolve going forward? >> the supply side, we expect appointment to keep going. i mention 400 megawatts this year. -- mentioned 400 megawatts this year. expect a quadrupling. in response to this, manufacturers are building gigafactory's to build those

electrolyzers. we stay china's company's to announce some large demand prizes soon. things are moving very quickly. overall this -- >> that was martin from bloomberg nef there. michael man will be giving us his take on what the u.n. is calling code red for humanity. coming up next, south korea's ipo, the maker of the hit game. we have a report from seoul. this is bloomberg. ♪

>> here is a quick check of the latest business flash headlines. chinese health startup wedoctor is said to be fielding questions from the hong kong exchange ahead of its ipo about how it is compliant with beijing's new cybersecurity rules. they were looking to raise up to $3 billion through a hong kong listing as soon as september. the chinese company looking to list offshore have been facing more -- chinese companies

looking to this doctor have been facing more scrutiny. amazon is looking to launch an indian antitrust investigation. two e-commerce companies are accused of offering deep discounts and preferential treatment to some vendors. this was an inquiry issued by a local retailer. biontech raised it forecast for this years covid-19 vaccine sales. almost $19 billion. they signed contracts to deliver some 2.2 billion doses this year and more than one billion doses in 2022 and beyond. the vaccine is on track to be on of the best selling drugs of all time given biontech -- all time, giving biontech cash push it needs. crafton debuts on the exchange

in just a few minutes. this is the second-largest largest korean debut on record. let's bring in our asian tech reporter. what are we expecting from the listing today? ? . crafton -- today? >> krafton is set to raise $3.8 billion and be the country's second largest ipo. 4981 per piece. there has been some concern over the high valuation. based on the price, it would become the biggest gaming company with more than $20 billion of market cap. typically, there is a first day trading pop in korea driven by retail investors who snap up shares for quick returns. qualcomm went for 79% on its

first day and -- on friday and continued to rise on monday. they could gain momentum because 90% of its sales are from one title. >> what is the business outlook for krafton? >> the ceo told us in an interview that the company is not going to stay as a one-hit wonder. the company is basically transforming itself to become an entertainment company with cartoons and movies. investors are betting that qualcomm could follow the business model of global entertainment companies like disney and they are raising price targets. the idea subscription drew tepid responses from investors. -- ipo subscription drew tepid

responses from investors. the dominant view is that investors may want to wait until they make another megahit game. >> that was the latest on krafton. let's turn to samsung. jay y. lee will be released from prison on friday. he will receive parole. peter joins us now. what are the locations of his release given we know there is a big push against conglomerates and south korea? >> there is but in the latest survey, it seems that criticism was a minor viewpoint. about 70% of those surveyed actually supported lee's parole. that is because many business leaders here felt he needed to be freed to lead samsung at a time when there is significant

competition among chipmakers as well as samsung brokering a deal for a vaccine and chip plant. many decisions need to be made and there was a compelling argan for his release to do so. >> he is still facing uncertainty from other cases and charges that could see him returned to prison, right? >> indeed. he needs to get an exemption to return to work at samsung. that is likely. he also faces several legal wells including being currently on trial for stockman epilation and accounting fraud related to a 2015 merger of samsung affiliates. he is also facing a trial on a separate charge of illegally using sedatives.

he has denied all of those charges but he could be back in jail if convicted. >> what will be his priority as he returns to the helm of samsung, peter? peter: the key one would be long-term strategic leadership basically. particularly related to samsung opening a plant in the u.s.. it is a $17 billion plant. they have not made a decision as to where it will be. that is something that lee will have to make a decision on. there is also mergers and acquisitions. they need to beef up on their chip sector as they are facing severe competition from china and other makers. >> that was peter with the latest on samsung. we do have some data coming out of china. the current account surplus

coming in higher than estimates at ¥905.1 billion. the expectation was for around 800 billion. it is a bit of a slowdown from the previous months of may when it came in at ¥9.1 trillion. the adjusted number for the trade surplus coming in at 1.7 8 trillion yen. we have seen some double-digit gains for export numbers across japan. june exports are rising 49% year on year. we are watching those numbers very closely. this as we see supply chain concerns across northeast asia. right now, the trading surplus coming in at ¥905 billion. let's turn to sophie for what stocks to watch. sophie: the spread of delta maine's top of mind. the grade of biontech shared its

forecast -- we are keeping our eye on ft bioscience. the stock has been rated new. samsung biologics is preparing to make an mrna type vaccine. they are very much on watch. flipping the board, over in sydney, we are keeping our eye on westpac. this australia subsidiary has required westpac life. >> coming up, we will get our outlook with carrie craig. watching that krafton debut. we will take a look at the broader korean ipo market. of course, we do have the market open in sydney, seoul and tok

yo, coming back from that long weekend. this is bloomberg. ♪

shery ahn: hello, and welcome to daybreak asia. heidi: taking a look at the markets in asia, our top stories this hour, investors way falling commodities, stimulus withdrawal, and the reason -- researching virus.

a training debut in seoul right now -- trading debut in seoul right now. and red alert from climate scientists. world leaders under growing pressure to reduce fossil fuels. south korea coming online and japan is back. let's turn to sophie. sophie: after a long weekend, the topix is up by .3% this morning. the yen is trading near a two-week low in the face of a stronger dollar. yields are projected to go higher. u.s. treasury yields are pretty calm after the jump we saw overnight that pushed the 10 year back above 132. a little bit of pressure this morning as the media reports that the company is seeking to put together a stimulus plan. softbank results this tuesday.

we have seen shares drop below ¥7,000. turning to south korea, sk pharma a potential sale. we are looking to see the kospi snap a three day decline. a negative debut for this stock after a raise of about 3.8 billion dollars in its ipo. we did see companies lock up about two thirds of its institutional shares. south korea now seeing delayed vaccine deliveries. a staggered open in sydney this morning. we are seeing shares gained about .1%. we are watching the climate report and iron ore futures are under pressure.

monday, the bloomberg commodity spot index notched the biggest loss in weeks. haidi: he has japan is one of his most preferred markets and is a beneficiary of the reopening trade. he is an equity strategist who joins us now. always great to have you. let's start with japan. do you expect to see parts of this market playing catch-up? >> absolutely. and good morning. i think it is the case around the world that if we look at what is happening in china, the u.s., and the developed world with the delta variant, we are still seeing the prospect for a lot of monetary policy and fiscal support. that should make japan a

beneficiary of what we are seeing in the global economy. inflation is not as bad here as in many other parts of the world. shery ahn: a similar strategy when it comes to korea, particularly when it comes to benefiting from a gradual reopening? >> again, the story is a little different when it comes to emerging markets. when it comes to the asia-pacific, we are all conscious of what we are seeing with the spread of the delta variant. there are better prospects in korea. valuations have moved a little bit. the focus is on the broad economy. we are a little more hesitant right now given the concerns around the coronavirus.

we would like to see things be a bit more stable and vaccination rates move a bit higher. shery ahn: talking about valuations, are we there yet, where we could find some bargains? >> valuations look pretty good when you are thinking about five years. if you are thinking about the next five days, it's another question. we are thinking about potential ramifications of how things are going to weigh on the market. uncertainty has been created. there are long-run objectives that chinese officials want. there are policy tools to try to address things with fiscal and monetary policy.

it is really a case of thinking about whether you are prepared to weather financial losses or if you want to wait for the financial gain to come through. china is definitely something to watch. i think they are going to remain a little hesitant and a little negative. shery ahn: we have seen asian tech chairs -- shares outside of china gain ground. are those some of the sectors you are looking at? >> asia-pacific technology is something different to keep an eye on given what we have seen in the semi conductor space around the world. that's something that's going to be very positive. long-term, china and the u.s.

are going to become more self-sufficient in technology. it's going to be a case of thinking about the global recovery and big strategic changes we are seeing. what is hampering the market are domestic conditions, the covid variant, as we mentioned. shery ahn: carrie craig with his calls on the market. thank you. heidi, we continue to see the spread of the delta variant. we are watching economic growth across asia. this chart is showing where there is economic growth in the asia-pacific region. we should look at that closely before they start cutting forecasts. goldman sachs came out and cut china growth forecast for the year from 8.6% to 8.3%.

this was slightly above consensus. of course, chinese growth was also downgraded earlier this month. haidi: enjoy the forecast before delta starts chipping away and we see more downgrades. i should point out there are just four economies forecast to upgrade. they are hong kong, where we have seen the domestic economy perform well, taiwan, of course, with the semi conductor story, new zealand with the divergent story, and a shift to live with covid as opposed to elimination. it does look like particularly southeast asia might get better. >> let's get to vonnie quinn with the first word headlines. >> thank you. employees will -- the senate is

poised to vote on a massive infrastructure bill. the original language will remain, something that has been opposed by investors. the administration has backed the compromise. one of president biden's top foreign-policy priorities is returning to the iran nuclear deal. the u.s. is reviewing options. meanwhile, tehran is finding ways to protest harsh u.s. sanctions. bloomberg news has learned the european union will not reimpose restrictions on non-essential travel from the united states. new infections have risen to about 470 per 100,000 in america.

ultimately, the decision on whether to admit u.s. travelers rests with each european member state. a dire report from the world's top climate scientists. the un's intergovernmental panel on climate change warns that the planet will heat up by 1.5 degrees celsius in the next two decades without drastic measures. global news 24 hours a day on air and on bloomberg quicktake powered by more than 2700 journalists and analysts in over 120 countries. i am vonnie quinn. this is bloomberg. >> take a look at what craft shares are doing. we are seeing a slight, plunging as much as 20% at one point.

quite the downside from an ipo that was at the top of a revised range. this debut is supposed to be the largest since 2010. we continue to see the pipeline of korean ipos this year. this trading debut is not going very well at the moment. haidi: not at all. still ahead, we are going to get some more analysis on this ipo and the broader appetite for the korean market. coming up next, we are going to take a look at softbank earnings as investors look for a program. we will also take a look at

china's regulatory crackdown. this is bloomberg.

shery ahn: softbank's china investments will be in focus today. bloomberg intelligence says we might see losses, but we might see a change in strategy. we have heard from many analysts saying there's really a black box when it comes to softbank earnings. there are so many companies they really cannot price in terms of profits. what are we expecting? >> it is really difficult to forecast softbank's profits. it doesn't really matter because the sentiment is quite weak at the moment.

a lot happened in july. the quarter earnings may be less meaningful to investors. having said that, there is still a chance for softbank to record a profit. when it comes to private markets , we can't really tell how much they can get out of it. the share price didn't get hit until july, so it still possible that softbank will deliver ok earnings. public shares are plunging. >> you mentioned the timing of the crackdown. does that mean the worst is yet to come? >> i believe that is the case for now.

there is no sign of clarity about the crackdown. i guess the main focus for earnings would be to explain the strategy going forward. if there would be a shift in strategy in geographical exposure or the reliance on transportation or just staying in health care. haidi: you can of course turn to your bloomberg for much more on bank earnings later on. results are crossing the bloomberg at 2:00 p.m. in hong

kong, 3:00 in tokyo. the exchange is reportedly asking how the company is complying with beijing's new security rules. joining us with the latest is our equity capital markets reporter. we are looking at companies, particularly ones that operate in the health space. >> yes, it seems both the hong kong stock exchange, even though we reported that hong kong accepted -- expected to be exempted from the requirement to obtain a private security review from china, they are still asking questions on how they intend to comply with the data requirements and they are

getting pushback on whether there is a written record of such discussions. pushback from the chinese authorities. especially after the db case. >> so, the company filed in april. what are we expecting as far as a timeline for this to go ahead? >> it is hard to say. it was filed in april. but markets are targeting as early as september. that's what we have been told. right now, this may change. that's probably best case scenario. depending on the market window. they have to be satisfied they have met all the requirements.

>> our capital markets reporter. coming up, a company looks to settle a long-running tax dispute. we hear from their treasury secretary just ahead. this is bloomberg.

>> india's revenues is looking at a controversial law that triggered billions of dollars in arbitration battles. >> you have not been influenced by the arbitration. as you would understand, it has taken about six years for this

arbitration matter to reach its logical conclusion. if we had followed the process of judicial courts, we don't know what the decision would have been. it could also have gone in our favor. it is not a matter of arbitration. our own decision we have taken if we want to give certainty and stability to taxation rates, for now, we're are looking at diversifying supplies all over the world and india is one of the major candidates, and we have a lot of candidates coming here.

>> have you heard from either vodafone or the other company? have they been in touch? >> i think the fact that there are some informal discussions i would not make public, but overall, the answer to your question is yes. >> from your perspective -- >> it would make no sense for the government of india to come up and say that. i am sure the government will find a solution. we started with a large number of telecom operators. it's important that we have

major players in the pie -- in the private sector as well as the public sector. that is what is suitable for the country. >> this is a long term -- long-standing issue. do you see investor confidence in india being boosted in a meaningful way? >> i am sure this will definitely have that effect. i also say this about my interactions with investors. this will continue to be one of the sore points they had in arbitration with me. i am sure they will be happy with this new prospectus. it is not a solution that's

giving a solution only to the companies that fought for arbitration. the sword was hanging on their head. >> are there more measures that can be taken to make india a more tech friendly nation? >> we are looking at it very positively. the general impression is he is only interested in revenues. i am interested in the economy. but i don't want to give up revenues. but if it helps the economy, i'm ok to give it up. >> here is a quick check of the latest business flash headlines. jp morgan has raise the stakes on wall street, intensifying the battle for talent.

junior sales trading and research analysts will now all get raises. meanwhile, they are matching goldman sachs by hiking banker pay. hsbc says it attracted $9.3 billion in new money to its private asian banking business in the first half. meanwhile in asia, wealth balance has reached a record, half of the global total. china hired more than 5000 new wealth planners in the region. the forecast has been raised for this year's covid-19 vaccine sales.

there is a contract to deliver more than 2.2 billion doses this year. the vaccine is on track to be one of the best-selling drugs of all time. amc entertainment posted narrower losses than expected in the second quarter even as the movie industry struggled to draw fans back into the cinema. while revenue sword, -- sword, the world's largest theater chain said customers are returning after the entire industry shut down last year. >> and ipo paring back some of the initial plunge. we get the news and take a look at the ipo sector in south korea.

this is bloomberg. comcast nbcuniversal is investing in entrepreneurs to bring what's next for sports technology to athletes, teams, and fans. that's why we created the sportstech accelerator, to invest in and develop the next generation of technology that will change the way we experience sports. we've already invested in entrepreneurs like ane swim, who develops products that provide hair protection so that everyone can enjoy the freedom of swimming. like the athletes competing in tokyo, these entrepreneurs have a fierce work ethic and drive to achieve - to change the game and inspire the team of tomorrow.

>> every decimal point of rise in temperature is remarkably compounded in the damage that it does. we are at 1.2 degrees today and you see what's happening. imagine what happens when you

are three degrees or so. >> very, very confident we can hit that pivot and policy this year. what we are seeing is capital continue to accrue to a much twhere we thought webe at this point. shery ahn: an update on the infrastructure bill. we are hearing from chuck schumer on the senate floor, saying they have the agreement. we had heard the senate was incrementally getting closer to passing the infrastructure package after what has been a drawn out debate. there were a number of proposed changes, one related to cryptocurrency. we reported earlier that

senators reached a compromise on that requirement. we heard from chuck schumer he expects a vote on that tuesday. after that, the senate will turn quickly to passing a budget resolution to pass the remainder of president biden's economic agenda. we are hearing from majority leader schumer that there has been an agreement on the final passage of the infrastructure deal. >> looking at the terminal, we are seeing bonds under pressure this morning. the apex index little changed for a second day. we are seeing gains for names like samson biologic.

to the downside, names like nintendo. futures under pressure as china's efforts to curb sectors on the mainland are taking effect. the dollar holds its gains and bank of america is saying we could see a strong rally in the second half. in commodities, new york crude is holding at 67. the short-term outlook for demand on the spread of the delta variant, oil could fall to $50. >> let's turn to craft and making its debut this morning -- craft -- krafton making its

debut this morning. it raised 3.8 billion dollars in south korea's largest ipo in over a decade. a record year for korean ipos. less than a week after another company started trading. the stock is not cheap, but it is not necessarily overly priced either. paul, what is happening with it today?

ipos, but it wasn't really popular relative to other ipos. there's not much popularity there. the ipo valuation was not particularly cheap, but i don't think it was overly expensive. if you look at other gaining companies in korea, they are trading at 30 times to 40 times per. if i had to pick a company in korea that best represents the new korea as a powerhouse of not manufacturing, but service, this company is it. 95% of revenue is generating from outside korea. unlike other companies that are mostly domestic focused, so this is a rare, truly global economy firm in korea. so, i am bullish. >> your expectations for other actors still in the pipeline this year are higher. >> kcal bank valuation was questionable compared to

traditional banks trading at 0.320.5. they traded 11 times price-to-book. the market is clearly viewing that as not just another bank but an operator, and it is pricing in that it will bring major disruption to the oil industry. it's a feeling i don't totally disagree with, but if you ask me, the bank hasn't shown much true innovation, but it thrives on more favorable regulation and aggressive loan marketing based on the platform to grow, while the korean banking industry suffers from overregulation. this is kind of their competition, if you ask me. the other ipo coming up is lg energysolutions in the fall. that will be the biggest ever and the climax of ipos happening this year.

>> you mentioned this cash -- catch-22 situation due to the limited pool of liquidity. is that the situation we find ourselves in looking at hot ipos like lg? >> yes, the problem that i see in the new ipo is that they are a subsidiary of an existing firm . lg is an example. it split off from lg chem. it already had a list of firms incubating, but it split off and listed as a separate firm. that is a problem because it lists another firm and it saps away the interest in the existing firm, which is bad for

the existing shareholders of the company. >> always great to have you with us as we continue to watch what is not the debut i imagine the company wanted. we are hearing from a canadian newspaper that chinese courts are set to give verdicts when it comes to the case of canadians detained. according to sources, they are facing the death penalty for drug smuggling. we are also hearing that a businessman is charged with espionage along with his fellow canadian. he is expected to learn his fate later this week as well.

>> this is daybreak asia. i am vonnie quinn with first word headlines. rising cases of the delta variant are causing fresh travel restrictions. aviation data shows the company

plunged 32% in one week. the latest outbreak affected more than half of china's businesses. meanwhile, failing to curb an outbreak of infections, authorities in wuhan found more cases after testing more than one million people at the epicenter of the pandemic. maternal -- moderna has been approved for use in australia as the company -- country struggles to contain the delta variant. they will receive 10 million doses this year. they are under lockdown in several states have imposed restrictions to keep the virus from spreading. a prisoner will be released on

friday after being recommended for parole. they considered his behavior while incarcerated as well as public sentiment. he went to jail for a second time in january after being accused of bribery. global news 24 hours a day on air and on bloomberg quicktake powered by more than 2700 journalists and analysts in over 120 countries. i am vonnie quinn. this is bloomberg. >> a major united nations report says human activity is causing unprecedented and air reversible change. they warn of increasing heat waves, drought, and flooding. here now, one of the world's most noted climate scientists. always great to have you with us . the u.n. secretary general saying code red for humanity. >> thank you. it's good to be with you.

this is a sobering report. folks in australia understand what this report is telling us. we are seeing the dangerous impacts of climate change. i was in sydney a year and a half ago for the fires. or what we are living through in the united states with the second largest wildfire in california history burning right now and threatening to become the largest wildfire in california history. what this report does for us more than any previous report is connect the dots. we would not be seeing these unprecedented and very damaging extreme weather events if it were not for the warming of the planet due to the burning of fossil fuels. >> i think there are less than three months until the voluntary national pledges kick in.

knowing what we know with certainty of this new report, what will you be expecting? >> we are seeing some pretty bold pledges. the united states has pledged to bring carbon emissions down 50% in a decade. that is what we need to do globally to avoid a catastrophic 1.5 degrees celsius. the u.k. and a number of other countries have put forward pledges purely at -- pledges. australia is lagging right now. we would like to see a more meaningful pledge from australia. of course, california is the world's largest emitter right now and one of the critical things happening right now is the negotiations between the united states and china to get them on board.

if we are to achieve the reductions we need, we need everybody on board, and that includes china, the developing world, india, and everybody else. there is a lot of work to be done. there are reasons for cautious optimism that we are starting to see progress, especially with the united states once again back in a leadership position on this issue with the biden administration. >> the race tonight zero includes these emerging economies. >> absolutely. what we need to do -- and you saw some signaling from the g-7 countries, for example, we need a willingness to commit to providing resources. to at least begin to provide resources necessary to countries like india to make sure they don't go through the same fossil fuel stage that the industrial world went through because we can't afford for that to happen.

we need to make sure it is in their interest, and that means providing them incentives to leap frog pass the fossil fuel stage directly to a clean energy economy. that's what we need from developing countries and we need commitments from the industrial world to make that possible. >> what about private enterprises and investors? we are seeing criticism that sometimes the system can be gamed on technicalities. >> absolutely. we really need the finance world, the investment world to be on the same side as governments trying to act on this problem. we have seen some commitments from some of the large finance companies. blackrock has made commitments. the bank of england has made commitments. we are starting to see some commitments in the finance world

to disinvest from fossil fuels. the international energy agency has come out and said if we are to limit dangerous levels, there can be no new fossil fuel infrastructure. we need the banking world to not continue to provide investments that further us in the direction of dependence on fossil fuels. >> you have lived in australia. you know the rhetoric from the government. even after this report, the prime minister still saying they refused to commit to net zero emissions by 2050. >> it is tragic. the australian people get it. australians understand that we are in a crisis. they need a government willing to act on their behalf rather than be a rubberstamp for polluters with fossil fuel

interests. there are measures being talked about for countries not willing to make meaningful commitments. there is a possibility of tariffs, of various ways of levying fees against those countries that are unwilling to make the commitments we need from them. >> given what we know in this report, is very useful model to be going by? >> we now understand far better than we did even a decade ago that how much warming we get for the foreseeable future is a function of how much carbon we have burned so far. if we stopped adding carbon to the atmosphere, the planet would stop warming up. this also tells us that our

budget is narrow and adding narrower. if we go past the catastrophic 1.3 degrees celsius, we have to bring global carbon emissions down by 50% within the next decade. that is an uphill task that will require major incentives from governments around the world to move us collectively away from fossil fuels to a clean energy economy. >> it is always great having you on. thank you. let's get the broader market applications from the report. >> with the report accelerating eeev policy support and decarbonization, we are seeing minors in sydney jumping.

taking a bigger picture look, two thirds of all global carbon will be by 2040 with china and europe leaving that trend. they are saying eeev is the new opportunity and investors are called upon to adopt a tipping point framework when it comes to climate change. there is a heightened emphasis on climate risk markets are looking for companies that have targets. we could see a d growth scenario with consumers. consumption needs to decrease to meet climate change goals. >> china's newest oil refiners are benefiting from the push for

cleaner energy. our reporter has more. who are we talking about here? >> chinese refineries popped up in the 1990's and they are known in the global oil trading industry. they process crude oil in the eastern province from the oil fields. now they produce more petrochemical products. they started as private chemical

fiber makers. and they have changed to an upstream industry, oil refinery. >> why the change? >> oil people and oil refineries are manufacturing in china, and that affects employment, tax rates and incomes. it's a unique business model. it's more petrochemical products . the newest refineries might turn

30% of crude oil and the rest will be petrochemical products. that's compared with maybe 85% of crude oil in the old ones. the structure of the products are largely moving from consumption to production, and that fits china's energy market and economy in the future and is in line with china's strategy to promote chinese cars. >> our asia commodities reporter.

tune into bloomberg radio to hear more from the daybreak team . lissa via the app -- listen via the app or at bloomberg.com. stay with us.

>> a quick check of headlines. this is what we are seeing at the moment. it tumbled at one point by 20%. we are seeing it down by still over 16%. it raised $3.8 billion through its ipo. krafton had to revise its offer price after regulators raised concerns about high valuations. we are looking at the hong kong exchange ahead of the ipo. a tencent backed company had been looking to raise $3 billion by september. amazon and twitch are set to face an antitrust investigation in india.

the two e-commerce companies are accused of offering preferential treatment to some customers. they deny any wrongdoing. >> take a look at futures right now. the s&p 500 and the dow dropped from record highs. we continue to watch concerns around the world. we are seeing china futures unchanged. we are watching the bond space. inflation playing into the market. offshore, the yuan is holding at about 648. coming up, the market outlook for the region.

and we look at chinese stocks in the second half. our coverage continues and we look ahead to the start of trading in hong kong, shanghai, and shenzhen. this is bloomberg.

in business, it's never just another day. it's the big sale, or the big presentation. the day where everything goes right. or the one where nothing does. with comcast business you get the network that can deliver gig speeds to the most businesses and advanced cybersecurity to protect every device on it— all backed by a dedicated team, 24/7. every day in business is a big day. we'll keep you ready for what's next. comcast business powering possibilities. comcast nbcuniversal is investing in entrepreneurs to bring what's next for sports technology to athletes, teams, and fans. that's why we created the sportstech accelerator, to invest in and develop the next generation of technology that will change the way we experience sports. we've already invested in entrepreneurs like ane swim, who develops products that provide hair protection so that everyone can enjoy the freedom of swimming. like the athletes competing in tokyo, these entrepreneurs have a fierce work ethic and drive to achieve - to change the game and inspire the team of tomorrow.

>> 9:00 a.m. in beijing and shanghai. i'm yvonne man. david: counting down to the open of trade on the chinese mainland. let's get to your top story today. both data and fed speakers continue to make the case for weaning. the u.s. economy -- weaning the u.s. economy off stimulus. yvonne: but they think more easing has a risk to ch