>> good morning. i'm haidi stroud-watts. we are counting down to the major market open. >> welcome to daybreak asia. asian stocks set for a cautious start after wall street dipped on concerns the economic recovery may have peaked. el salvador's crypto rollout has a rocky start. the president says he used the opportunity to buy the dip.

china's property crackdown alarmed analysts as the president comments trigger a public debate. >> great to have you back after the long weekend. as with so many points in this year, you get to this milestone and think, we thought we would be somewhere different. the return to work was supposed to be most people back in offices, fully vaccinated, probably not wearing masks and most of the pandemic hind us. that is not the case. shery: i had a long holiday last week because i was anticipating after labor day we will be back to normal. everybody said that but it doesn't feel like anything has changed. everybody is wearing masks. we continue to hear about this work from home set up that everybody continues to prefer. it is interesting because deutsche bank came out with a report to clients saying you are

increasingly likely to develop muscular-skeletal problems due to inadequate remote work setups but people seem to prefer it. haidi: we are also seeing not much of a break for bitcoin and crypto. perhaps this is one of the trends of the pandemic as we head towards the idea of policy normalization for a number of major central banks. bitcoin can't catch a break. el salvador, the news they took it on as legal tender, we saw a fault of the lowest in about a month for bitcoin. it was down 1.517%. we are seeing still some swings when it comes to bitcoin. we heard from mark nova gratz who said the ptueswas a consequence of investors having gotten too excited.

you are hearing from el salvador saying you just buy the dip, there is further upsides, this is the start of the story. we will continue to watch that as one of these pandemic stories that has grown into something that has its own idiosyncratic volatility. shery: same thing for japan. we are getting gdp numbers, they were hurt during the pandemic as everybody else was. these are the final numbers. the reason i point to these numbers, we got the preliminary, we are expecting a slight upgrade to 1.6% growth in the second order but given how well the market has done in japan, i wanted to bring attention in the next 60 minutes, we are getting trading again, the nikkei surpassed the 30,000. -- level. we are having a change in politics in japan so we are watching that closely. haidi: economic policy changes may be on the horizon. it doesn't seem like the boj

will change their objectives. the interview with predecessor saying the boj perhaps needs to get real. how long have we been targeting 2% inflation? we haven't gotten close to that. perhaps it is time for a reality check. chicago nikkei futures, one of the few marginally upside movers in the futures session. we will wait to see whether we see another touch above ¥30,000. perhaps some signs, given the extraordinary gains after the resignation. there are signs japanese equities are overboard, maybe a bit of a pullback. sidney futures down 0.4%, a downside of about 0.3%. the rba trying to strike a tone of flexibility. moving forward, but seen as a dovish taper as they push the

duration out to mid february. let's get you to vonnie quinn who has the first word headlines. >> u.k. prime minister boren johnson -- boris johnson appears to have quelled a conservative already rebellion over a tax hike. this after announcing pensioners and shareholders would also take a hit to fund the nhs under reformed social care. all working adults will pay more. this breaks johnson's pre-election pledge not to raise taxes. >> most conservative governments -- no conservative government wants to raise taxes but nor could we in good conscience meet the cost of this plan simply by borrowing money and imposing the burden on future generations. i will be frank, this will break our manifesto commitment. but global pandemic wasn't in our manifesto either. >> house democrats unveiled key

components of president biden's planned 3.5 trillion dollar bill. they are planning an expansion of the social safety net. it hasn't revealed the proposal for tax hikes on corporations and the wealthy, which would help pay for spending in the broader bill. johnson & johnson's vaccine cuts the risk of covid-19 infection by about half. this according to a trial involving almost half a million health workers in south africa. the study shows most of the infections that broke through are mild and the shop stopped the majority of subjects from dying. south africa is experiencing a third wave of delta infections. global news 24 hours per day, on-air and on quick take by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. haidi: china's goal of prosperity has led to clampdown's on companies across industries including tech,

education and insurance. it is showing no signs of abating. the property sector has taken a hit. analysts warn of a credit squeeze that could hurt the economy. the spiraling crisis is adding more to the risk pressure. let's bring in stephen engle. it is interesting, thinking about how much short-term pain policymakers might be able to take broadly to make these reforms. stephen: there will be short-term pain, but they are trying to avoid long-term pain. analysts are saying the combination of steps and the aftereffect, the domino effect to developers could have a spillover effect. the bank of america, in a note, said the rapid slowdown in the property sector activities could lead to a significant spillover effect. they are talking about the unnecessarily aggressive steps that have been taken. i have been to aging -- beijing

for many years and i watched property market closely. there will always be the threat daily of new regulations to come out to curb excessive property price gains. then there would be relaxation. there was this more back and forth. this time it seems different. xi jinping pulling properties into the common prosperity theme, saying multiple times that property is for living and not for speculation. we have seen the willingness of authorities to allow mostly private developers to default. these default numbers, property firms defaulted on $6.2 billion worth of high-yield debt through august, about $1.3 billion more than the previous 12 years combined. the news yesterday with ever grand, the most indebted developer in the world with over

$305 billion in liabilities, moody's signaling they are on the verge of default. that and other developers are severe issues as property loans rose at the slowest pace in eight months in the first seven months in eight years in the for seven months of the year and home price growth dipped to a six-month low in july. shery: when it comes to the education sector, china has banned foreign -- from collecting fees. stephen: this is folded into the common prosperity theme. xi jinping on the government is taking on the online schools, the afterschool tutoring business, which has seen exorbitant price gains intuition . that is creating imbalances in pressure among families to get their kids into these schools or fear being left behind. those who can't afford it, so

there are price issues and fee sensitivities the government is tackling. essentially, you could say nationalizing the industry, because the fees have gotten so out of hand according to the government, the latest news is that china will ban these tutoring companies from enrolling new students or collecting fees until they register with the government as being nonprofits. the deadline is bided -- by the end of this year. shery: stephen engle. we have a timely headline saying china will increase transparency of policies. we will be awaiting that as that editorial just dropped. let's turn to the rocket start to bitcoins launch as legal tender in el salvador. the rollout was met with technical glitches and a plunge in price. bitcoin fell 17% at one point. su keenan has the latest. what kicked off the decline? su: there was a problem downloading the digital wallet, the app that has to be used to

transact with bitcoin. there was enormous focus on el salvador's adoption of bitcoin. they have 200 atm's across the country that take bitcoin. the glitch caused a huge downturn in bitcoins price. and related stocks. you can really see in the related stocks, the difference this caused. if we can go to the stock chart to show you the kind of declines, we have been pointing, bitcoin coming back to 47. the sharp drop followed by rebound was accelerated by a big trading and leverage issue. more than 36,000 traders had their accounts liquidated over the past 24 hours according to data we received. that is equal to about $3.6 billion in crypto. the combination plunged bitcoin below 44,000. it has come back to 47,000.

bitcoin supporters say 47,000, we could be on our way back to the peak above 60,000. the president of el salvador tweeting, mentioning his citizens got to take advantage of the dip and a lot of bitcoin supporters say this is a blip in the road. shery: su keenan with the latest on the bitcoin rollout in el salvador. you can get more on the cryptocurrency and a roundup of the stories you need to know to get your day going in today's edition of daybreak. bloomberg's a prybar's -- bloomberg subscribers, go to your mobile app. pans second-quarter gdp is expected to be revised up. bank of america's official breaks the growth concerns for the nation's nest -- next leader.

our guest tells us why he is buying the u.s. dollar. this is bloomberg. ♪

>> payback came early. >> september is a critical month. >> a bunch of things going on. >> post labor day was the game plan. >> it started the new year as a wildcard. >> companies are pushing the back to office. >> corporations have pushed off a full return to office. >> you have given the fed some ammunition to not taper. >> there was some slowdown. >> you have to downgrade a little bit. >> so much talk of a weakened market in september. >> payback has been fast and furious. haidi: some guests earlier

speaking about global growth concerns as we head into the final stretch of the year. shery: our next guest says you must buy the dollar on dips especially against em asian currencies. let's discuss ways to play the region with vishnu varathan. always great having you with us. this chart on the bloomberg, showing we have seen two weeks of consecutive losses for the dollar for the first time since april, but right now we are seeing a bit of strength. given those growth concerns, which pairs across asia do you like? vishnu: it does look like initially you will get a lot more of the pickup coming through for the currencies that are impacted by the commodities setback. sue -- so you get your audience reacting adversely whenever the dollar rebounds. you have also got, the headlines

on covid, there is some back-and-forth with different ground made up for the ringgit, the thai baht, but it remains vulnerable if we get past september and that back to what is diverging recovery between the u.s. and the rest of em asia. i think the korean won, in theory, out to -- ought to be in outperform or -- an outperformer. but the china risk is rippling through. these are things to bear in mind. our sense is that the initial downturn will be followed, and different currencies could feel a bit of heat so we are watching that. haidi: against japan, we have seen the u.s. dollar really range bound. we are expecting final

second-quarter gdp numbers at a time when we are hearing perhaps we will see extensions of virus emergencies. where do you see the pair growing? vishnu: the dollar-yen, we are looking at the dollar-you and being more boy and. -- more buoyant. they are baking and fiscal stimulus and dovish marks from the boj that could factor into buoyancy and the negative correlation between equities and the yen will probably play up. insofar as u.s. yields remain somewhat subdued, the upside in dollar-yen could be contained so we don't expect a big directional move. rather consolidation. haidi: when you take a look at the enthusiasm we have seen in japanese equities, which economic policies are you actually expecting will

translate to meaningful positive change to corporate earnings? vishnu: i think we are looking at day host of policies -- at a host of policies put in place. some of these could be short-term incentives, liquidity measures. right now, the main issue is around fiscal policy. it is going to be split into three parts. the first is how to get through some of the bumps in recovery. there will be lots of concentration on liquidity measures and backstops and so on. there will be a capacity expansion in the second phase, and this may be familiar with some of the three arrows concept. the last aspect has to come back to fiscal consolidation, and i think that is the one people are watching. haidi: let me get to china. we are hearing in an editorial in the people's daily, highly

influential, chinese increased transparency when it comes to policies and this crackdown is to better support competition amongst companies. this takes us to the question of the day. how do you -- how do markets play the common prosperity theme? you ask every investor, you get a different answer varying from stay away from chinese assets altogether to play this for the long run. what is your view? vishnu: the aspect of this that is most beguiling is the fact that there are multiple policy objectives. some contradicting one another, which is why we don't get any kind of clarity on this, but one simple way of breaking this down, which is of course owing to suffer from being too simplistic, is to be in the hard aspects of tech. in china, they want to develop competitiveness in chips, technology, telco,

communications, green vehicles and so on. those technologies and the supply chain could benefit, but anything on the softer aspects of things like the platform where data issues are at hand would go back to the government. haidi: always great to have you with us. vishnu varathan. next, bitcoin plunging. el salvador's crypto rollout off to a rocky start. we hear from one of the biggest backers. this is bloomberg. ♪

>> el salvador, let's face it, is on its back. it has real problems. it is a bankrupt country.

they are grasping at straws with bitcoin. don't think -- they be a few other countries it will spread too, maybe cuba, countries that have financial problems will adopt it but i don't think this is going to go too far. shery: mark mobius criticizing el salvador's crypto push. these are your crypto assets. bitcoin fluctuating between gains and losses. this after falling to a one-month low in the new york session, perhaps proportionality playing a part. september has failed to deliver positive returns in the past decade. haidi: we will be talking about crypto and the plunging bitcoin, but one of the space plus biggest boosters is staying bullish. galaxy digital's mike novogratz says the plunge is because investors got too excited.

mike: there has been a big selloff. we have to remember crypto is still a retail dominated ecosystem. we have institutions moving in by the day, creating a lot of excitement. but there is lots of retail money, a lot of it leveraged. there was about $4 billion of liquidations that happened in a short period of time this morning. that is mostly leveraged offshore in some places, and the market got too long. it got long for good reason. i think in the last eight weeks, there has been a giant realization that crypto is not just bitcoin being bought as a hedge against bad monetary and fiscal policy, but may be importantly, it is web 3.0, the internet of values. we see companies like visa buying and fts, saying they think digital codes -- digital goods are a part of the future. amazon and walmart are putting

up help-wanted signs for crypto experts. there is a realization that this is a technology thing and no investor wants to miss the next internet. this is the next internet. there was a lot of great price movement, going from $29,000 to $53,000. a new level 1 for most institutions burst onto the scene. i think we got too excited and this was a little air coming out of the balloon. >> we want your thoughts on solana but first, what role if any governments will have in this? they all this -- the el salvador approach was straight transactional. we have seen concerns gravitating towards a model with bitcoin. for other governments, what role

do you think they would play in this environment? mike: there are two different sides. governments will be very protective of their national currencies. their ability to do -- to print currencies is pant amount -- is paramount -- is tantamount. they will be ok with payments, you will see a rise in stable coins. basically versions of the national currencies. things like bitcoin, which in the west are really being used for value. people aren't using it as a transaction currency. in el salvador, 20% of their gdp comes from one source and you can see lots of those remittances, people sending bitcoin back across oceans from the u.s. to el salvador and the local leaders worried about the

dollar, or converting it and spending it in the local economy. it is unique in that respect. we will see. maybe it gets used as a transactional currency. i never thought it would 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. (woman) i don't want to look like this anymore. (man) what is happening to my body? (woman) why can't i lose weight? (announcer) you may be suffering from insulin resistance. measure your waist. females measuring more than 35 inches

and males measuring more than 40 inches may have insulin resistance. to learn how to reverse insulin resistance and lose weight effectively, go online to golo.com. once again, that's golo.com.

♪ funny: this is "bloomberg daybreak asia," i'm vonnie quinn with first word headlines. president biden preparest outlined a new strategy to fight the pandemic. biden will unveil a plan thursday with vaccine hesitancy slowing vaccination efforts. the white house has downplayed expectations of any vaccine mandates in the biden speech. >> folks, we got to listen to

the scientists and economists and national security experts. they all tell us this is code red -- the nation and world are in peril. that is not hyperbole. that is a fact. ♪ vonnie: a new report from deutsche bank highlights downsides of working from home, showing a growing number of employees feeling isolated from colleagues. workers are increasingly likely to develop musculoskeletal problems. i deutsche bank survey still shows most people expect to keep working from home two or three days a week even when the virus subsides. a u.n. watchdog says iran's new government is scaling up production of highly enriched uranium. in its first report since a hardliner took the presidency, the iaea says the iranian stockpile escalation comes as talks to return to a 2015

nuclear deal. the taliban have included the leader of the u.s. designated terrorist group in its new government to formally mark the group's return to power after 20 years of war with america. the hakani network leader will serve as acting interior minister, potentially cooperate -- potentially complicating cooperation with the united states. 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 am vonnie quinn. this is bloomberg. haidi: shinzo abe and his successor, investors have had limited opportunities to make trades based on new policies. there is now speculation on who will take over. that's get a snapshot of potential winners and losers from our asian stocks reporter.

even with instability that is a real potential, a potential return to revolving door leadership, we are seeing this [indiscernible] underneath japanese equities. >> like you said, it could be the case that sometimes when the prime minister steps down, it creates uncertainty. and there is a response from the stock market. but the situation now that we are facing is the fact that people are seeing this as an event that caters up uncertainty because of an unpopular leader stepping down. and based on what the most recent history is telling us, the market is in for a sustained rally for a few months because that is what happened in the past when the ruling party made a big win in general in elections. that is what we are anticipating when the election comes later

this year. caroline: -- shery: it is not just met atsugo, right? what else is propelling this market? >> pick couple catalysts including the cabinet shuffle this week including -- including the shuffle this week including nintendo in manufacturing. these three stocks are seen as better representing the japanese economy, and making it more of a blue-chip measure that it is supposed to be. so that is also gave a little boost this week. this is -- we have the earnings season coming later in october at a lot of investors are looking forward to that as well. haidi: softbank search the most in nine months after a deal

to acquire part of deutsche telekom and stand -- ancel part of its stake in t-mobile to the german telecom character. let's bring in our reporter. what do we know about the deal and why did we see the reaction? >> this has been in the hopper for a while, part of the merger between t-mobile and sprint, and a company that some bank owned in the united states. that gave softbank 25% stake in the resulting company. as part of the deal, softbank gets 225 million deutsche telecom shares in a swap and deutsche telekom byleft, which o

potentially 6.9% if the t-mobile price hits $150. but probably none of that is the reason by the share price gain. softbank is pointing to new positives, that it is part of their diversification strategy for the telecom portfolio. it also gives access to vision fund companies in europe and the united states. but it is purely the cash portion of it that probably boosted shares yesterday. shery: the big question always

around softbank is whether they will announce another repurchase of shares. what can we expect? >> the $2.4 billion from deutsche bank doesn't justify a 10% jump in shares, and not enough given they spent want to $3 billion on buybacks last year. -- spent $23 billion on buybacks last year. the discount approached 60% before the recent share jump, an area where a lot of people were anticipating additional repurchasing. at the last earnings, they did not rule out a buyback but say they are weighing factors. one is the fact he is spending money for investments in vision fund two at an absolutely

record-breaking pace. in other words, we are in limbo. watch this space. haidi: you mentioned the competition, concerns about competition from eu over the deal. is it dead in the water at this point? pavel: it depends on who you speak to. so people feel resistance between the -- from the eu and u.k. can be overcome, but the real thing is china, the process in china is opaque and given geopolitical winds, where giving a major american semiconductor firm a win is potentially not politically compatible for china. you can imagine how bad that would be. shery: asia tech reporter pavel alpeyev with the latest on

softbank. also counting down in seoul, a newspaper reporting japan is extending a state of emergency and portions of tokyo until the end of the month as the country battles the delta variant spreading across the nation. we are expecting economic data including final second-quarter gdp numbers on current account balance, due in a few moments. the consensus is growth of 1.6% in the second quarter, which would be a slight upgrade from preliminary numbers. toyota planning to spend $13 billion on supply and development of batteries for hybrid and electric vehicles by 2030. it joins other global automakers and boosting investments in this area, anticipating regular man. south korea, we will be watching crypto-related stocks, focusing on the bitcoin tumble, the technology and investment in macau, what we are watching.

talks to sell the beijing number two plant as part of chinese baseness restructuring and we are also watching the finance minister and other heads of economy-related ministri are setes -- ministries are set to attend a session at 10:00 a.m. local time. haidi: ice folk with the nation's first and only female astronaut on general equality in the space industry and criticism of the space mission. >> [indiscernible] for 10 years and my undergrad and phd. i was two girls among 120 classmates. at the time, our workshop, we didn't even have a female bathroom. they were sympathizing with my experience because i had to go all the way to campus to go to the female bathroom out of the building. but i really want to see the

development in the current status because 10 or 20 years ago when my mom was my age, 34 years ago, she went -- she didn't go to middle school because of the role of the farmer. if i was living in that kind of time, i think i could not sustain at all. my mom [indiscernible] and my grandma cannot even read or write. she is totally illiterate because of the cultural background. and now, me as a girl, i became a phd in engineering and the first girl astronaut. i believe development for girls is really important. i think we will have more positive development for gender. i really want to do my best to support that, but it is not

enough. there is a lot of criticism when i became a final primary crew. some of the korean guys criticized that we shouldn't make the first girl astronaut, that kind of thing. but i really want to prove space is a fair place for any humankind, zero gravity is only requiring that you have muscle, because there is no weight at all, so space can make everybody fair and parallel. haidi: you did have a hard time by the time he stepped down from the space program, you went through difficult period of criticism. a lot of people weren't happy because they saw a lot of p.r., and i wonder if you think it was a man who was in your position, with a have been treated that way? and is that deter young women in

south korea who want to take high-profile roles, whether in business or science or politics, because of the fear they will be called out? soyean: i don't want to blame gender criticism on those situations. you've talked about how the little girls feel, if they see how tough my life is, and they really want to be like me, that is the burden of the first girl astronaut and south korea. -- first girl astronaut in south korea. so i feel like i have to be positive and i should make my like happy and convince more girls like me to have a happy life. haidi: before and let you go, would you go back to space? soyean: of course. [laughter] i can't afford to buy a ticket from jeff bezos. [laughter] but of course, i would love to go. some of my friends said, you

were almost killed on the way back. i know. but i want to go back. it feels kind of like mount everest, if they lose their fingers or toes because of the hard time, they pack up and go back, -- they don't back up and go back because that is something that gives them inspiration and makes their life more meaningful. haidi: inspiring conversation with south korea's first female astronaut, soyean yi. japan gdp to be revised upward, we get that imprint in a few moments. and what lies in stores for the economy and the nation's next leader. this is bloomberg. ♪

♪ haidi: we are expecting japan's second-quarter gdp figures any minute. growth is expected to be devised up on the capex reading according to bloomberg economics. this will be the next economic gauge for the next japanese economic leader who will be faced with challenges, including trying to spur growth,

inflation, and managing economic policies that need to be weighed against handling of the coronavirus. for more analysis, let's bring in izumi devalier, head of japan economics at bank of america global research. we are not expecting a huge surprising the gdp reading today. what are the big challenges for whoever takes the role as the next japanese leader? izumi: thanks, and good morning. whoever is chosen as the leader and new prime minister, the first and foremost task he or she is going to face is the managing risks of covid against economic reopening. japan is coming out of its delta-driven fifth wave. with vaccination rates up, about 60% of the vaccination received at least one dose, the government to starting to talk about reopening milestones and the strategy.

they are expected to finalize a document that talks about gradual lifting of recommended curbs on activity in october going into november. you know, the delta variant of these variants are very transmissible, so they are going to have to be careful and do things one step at a time. haidi: the misstep it seems for the souk administration -- the suga administration was mishandling the delta outbreak and restarting economic wrote -- economic growth. what will need to have an for the next leader to get that right, or at that point will we see a higher vaccination level? izumi: i think another thing that has been a big bottleneck in japan's coronavirus response is medical facility capacity. japan has the highest per capita hospital beds in the oecd. there have been coordination problems. many of the beds are not available for covid patients.

that is what led to this fifth wave being so scary in places like tokyo and osaka. addressing medical system capacity is another. having development of effective treatments will also be very important in showing up confidence -- shoring up confidence. we have a big elderly population that is going to be uncomfortable going out if there is even a little bit of a threat. they could get very sick. hospital system capacity, effective treatment, and better signaling on communication from the government. these three steps i think are important. shery: how much government support can we expect in the form of fiscal stimulus? izumi: the government is almost certain to compile another economic package after the lower house elections which follow the leadership elections. there is a lot of numbers going around. probably is going to be in the

tens of trillions of yen, focused on supporting consumption and businesses. we don't know exactly how much yet. that is dependent on the leader. shery: what are we seeing right now in terms of corporate sentiments, with everything going on on the delta variant side of things? not to mention existing fiscal stimulus in the economy? izumi: on the corporate side, it continues to be a k shaped recovery. we have manufacturers doing quite well. there are issues with supply-side bottlenecks, especially in automotives, but generally, global trade and investment demand is strong. large firms are doing well, it is the non-manufacturers, especially in person services like travel and restaurants and fme's that are struggling. this is part of the economy that needs to get better, where the reopening is going to help. shery: we are getting those

second-quarter gdp final numbers that they are above expectations. growth of 1.9% annualized for the second quarter. this is an upgrade from the preliminary numbers that came in at 1.3%. it is also a bounce back from the 3.7% drop in the first quarter. we are talking about the headline numbers quarter on quarter, also above expectations, growth of .5%, we are seeing a revision upwards not only for business spending, which we were expecting to be revised upwards, but this has also come in above expectations at growth of 2.3%. but also, private consumption coming in above expectation with growth of .9% quarter on quarter. give us your reaction to these numbers that all the looks of

it, seem better than what most people expected. izumi: yeah, a little better than expected. the old number was 1.3 percent annualized. we are talking 1.9%. i am in courage that -- i am encouraged was as strong as the original imprint expected -- i am encouraged capex was as strong as the original imprint expected. in the third quarter, we think near-term headwinds are persisting. on one hand, you have supplied side from the delta variant hitting auto production hard, especially in september. i think the i.t. end exports odd, manufacturing might struggle. and also consumption. it is always backward looking but we were in the midst of a pretty serious delta-driven fifth wave, which crimped

services spending in august and probably in september as well. the third-quarter growth imprint is possibly going to be negative, so flat growth for the first three quarters. it shows japan was really hit hard by the covid, ongoing covid outbreak. but things should get better at the end of the year, into next year. haidi: when it comes to what the boj can do, we have interesting insight from the former deputy governor of the boj before corona. the deputy governor said there needs to be a reality check. they are probably never going to get to 2% inflation. they have done as much as they can throw in terms of the stimulus. are they better off establishing a more realistic price target? is that possible? what would that communicate? izumi: it is not a good idea to

consider something like that at this juncture. remember, we are in the midst of the covid shock. if the headline inflation reading is negative, even for idiosyncratic reasons, what is the benefit of having that discussion right now and risking sharply tightening financial conditions? we can have that discussion once the economy fully recovers, but we are not at that stage. even the fed is not at that stage. shery: izumi devalier, head of japan economics at bank of america global research. we have plenty more to come at "bloomberg daybreak asia." this is bloomberg. ♪

♪ shery: quick check of the latest business flash headlines, toyota planning to send 13.7 billion dollars on the supply and development of batteries by 2030 in anticipation of greater demand for electric vehicles. earlier this year, toyota announced plans to introduce 15 ev's globally by 2025. the number-one automaker is sticking to its vision for non-ev cars such as hybrids, which it said will continue to play a lasting role in global auto markets in coming decades.

forward is hiring the head of the apple card project away from the iphone maker. he joins ford as chief advanced technology systems officer. fields also worked as a top engineer at tesla, and played a major role in launching the model three. david: coming up -- haidi: coming up, investors reacted gtb -- gdp data in japan and the realities that await them. we will hear from bridgewater founder ray dalio, live from the bloomberg radar event. sydney and tokyo are about to start trading. this is bloomberg. ♪

♪

shery: welcome to "bloomberg daybreak asia." from bloomberg world headquarters in new york, i'm shery ahn. haidi: asian major markets have opened for trait. our top story, wall street dips on concerns the economic recovery may have. china property growth alarms analyst as president xi's, and prosperity drive triggers a rare public debate. and the coin tumbles after el salvador's crypto rollout. shery: japan, south korea and australia all coming online. the nikkei under pressure, this after seven consecutive sessions of gains, the longest run in 10 months for the nikkei. topics under pressure after its best run since march for the broader index. this comes at a time when we saw gdp numbers for the second

quarter, final numbers, outperforming expectations, growing 1.9% annualized. we are also getting news that perhaps we might see covid restrictions being extended. the japanese yen holding at the 110 level. we are watching the japanese yield as well because jgb is under watch after the smooth auction of 30-your dad and we are looking at the 10-year yield at that level not doing much. the kospi, downside pressure, .4%, continuing to fall for a second session. we have been watching overseas investors cut holdings. the korean yuan down .4% against the u.s. dollar. it has fallen from a three-week i as we continue to see foreign flows out of south korea. -- three-week high as we

continue to see foreign flows out of south korea reversing gains. haidi: the greenback's best day in three weeks, a bit of a pause when it comes to the big decliners, the aussie kiwi and the dollar. 73.85 when it comes to trading in the aussie greenback at the time. aussie stocks up .1% at the very start of the open. we are processing the implications of the rba. you can call it a dovish taper plan, reassessing bond purchases but sticking to pathway normalization. new zealand down .5% as large part of the country emerge from a lockdown. breaking news when it comes to black -- concerns over regulatory headwinds in china but blackrock raising 6.7 billion yuan, about $1 billion for its first china mutual fund, the chinese

market the most elusive and profitable world market. and this after a financier called a china investment a tragic mistake and now we are seeing blackrock establish its first public monday's ahead of schedule. people familiar with the situation say entered a close is meant to start investment and the september 10 deadline was when it was meant to be closing. shery: breaking news around lbs management. the activist hedge fund has a more than $1 billion stake in citrix systems. the what the software company to take action to boost their lagging stock price, according to people talking to the dow jones. elliott informing citrix it has a stake of more than 10% that they want to work the country -- work with the company to improve you asian. haidi: -- improve valuations. haidi: japanese stocks on a

seven-day winning streak, the nikkei touching $30,000 for the first time since april. we will see if they can do that today, and perhaps at the close. it is partly an index rebound but also adding big hitters to the nikkei 225. there is also optimism a new prime minister will bring in favorable business and economic policies. our next guest says he remains overweight when it comes to japan, stefan hofer, chief investment strategist at lgt bank. trading in a 31-year high, look at the start because we have been talking about the start of a it comes to equities. the nikkei, breaking the intraday average. is it getting close to closing the gap with the s&p 500 and could we see rotation in favor of japan away from china given all the regulatory issues in the market? stefan: one of the issues for japan which is maybe not that well known by many market

participants is the fact that the vaccination rate for covid-19, the curve is very steep. the japanese have made a lot of progress in a fairly short time to get more people vaccinated. right now, there is a very serious spike in covid-19. but if you take a two-month view, it is going to probably be peaking by then and that will release a lot more economic activity. that will coincide with the new government. their various -- there are various narratives coming together that are supportive for the japanese market. haidi: yeah, we are seeing milestones ahead when it comes to vaccination levels getting to 50% japan in coming days. when it comes to translating potentially with the new leadership could mean for economic policy, corporate earnings, who would you pick as the winners? stefan: very good question. japan is a deep blue cyclical market and one of the potential

issues is that what investors could be looking for in this next phase for the market is more growth companies. so, that would accurately imply more that japan could be more of a tactical trade and then we would rotate back into the united states at a later stage, when growth becomes wet -- when growth stock comes more in favor. shery: what about beaten-down chinese equities and devalue trade, which takes me to our question of the day, how the markets play the common prosperity theme? stefan: one of the broader challenges has been, for a longer period of time, there was diveggae -- divergence between market policy in the united states and other economies. that is changing. chinese authorities are taking a

more looser and accommodative stance. going forward from that, it is going to be an important catalyst for investors to re-examine their china holdings. shery: where would you re-examine it? how would you change your portfolio allocations? stefan: valuations for some of the big tech names that we think are attractive, i think the household names would be the first call, then other sectors, health care and places where we see interesting individually companies. shery: when it comes to all these big calls, whether from george soros or blackrock now raising $1 billion for its china mutual fund, where do you stand in this debate that is going on on where china is headed? stefan: we see great opportunities, especially in the mid cap or unlisted space.

there are innovative, exciting companies we are taking a closer look at. we are definitely more in that camp, although there has been a lot of regulatory change in a very short time. so there are risks, naturally, attached to that. but taking a long-term view, we see select, innovative companies that we are taking positions in. haidi: when it comes to the fed, the expectations of the taper continuing to support sentiment, how much further upside do you see from that alone? stefan: very good question, and i think the major disappointment from the nonfarm payrolls that we had at the end of last week shows how complicated this process is in terms of managing fed policy. but at the end of the day, our new assumption is that you are going to get a tapering announcement most likely in november, not september. but the direction of travel for

the fed has not changed. so come over the next year or so, tighter financial conditions in the u.s.. shery: stefan hofer from lgt bank, thank you for your insights. let's get to vonnie quinn with first word headlines. vonnie: u.k. prime minister boris johnson appears to have quelled the conservative rebellion after announcing pensioners and shareholders will take a hit to help fund vnhs. all working adults will pay more, breaking johnson's pledge not to raise taxes. >> no conservative government wants to raise taxes, but none could be in good conscience and meet the cost of this plan simply by borrowing the money and imposing the burden on future generations. so i will be absolutely frank -- this new levy will break our manifesto commitment.

but a global pandemic wasn't in our manifesto either. vonnie: and the taliban have included a u.s.-does knitted terror leader in its cabinet as a formally returns to power. the terror leader will serve as acting interior minister, potentially complicating any cooperation with the united states. the myanmar shadow government has declared war against the military regime the seize control of the country in february. in a feast on social media, the acting president of the national unity government calls for a revolt against the junta in a nationwide uprising, urging armed groups to target regime assets and forces them myanmar military downplayed the move, calling it just a threat. the white house says three quarters of u.s. adults have received at least one dose of

the covid-19 vaccine is president biden preparest outline a new strategy to fight the pandemic. i did will unveil the plan thursday -- biden will unveil the plan thursday with vaccine hesitancy slowing efforts and cases hitting new highs. the white house is downplayed any expectation of vaccine mandates in the biden speech. 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 am vonnie quinn. this is bloomberg. ♪ haidi: one of the out performers, mccrory group hitting a record high, trading at the highest we have seen in seven months, up over 5% after the first half results came in slightly lower compared to the second half for 2021, but they do say they stuff favorable market conditions with helped that conditions which helped with a stronger result, saying the speed of the global recovery during covid-19 and what we saw

in favorable support for economies will be playing into the outlook. they say they take a conservative approach to capital funding and liquidity given current uncertainty in this environment. shery: coming up on daybreak asia, live coverage of ray dalio 's speech where the cofounder of bridgewater talks about space investing. up next, taking issue with george soros over investing in china. this is bloomberg. ♪

♪ >> i have been pretty positive on the measures china has been taking. >> what is happening in the data

is something we are still observing. the contours are not yet clear. >> it means that they are moving more towards fair regulation, trying to create a level playing field. >> eight is a wildcard with the government and their policies -- it is a wildcard with the government and their policies. >> the big selloff means we are looking at whether there are opportunities. >> in some ways, these measures by china is making it safer for investors, including foreign investors. >> there are some investment opportunities there. the question is to size them accordingly. >> china is investable. it is just making sure perhaps you don't get too carried away and certainly that you don't start overpaying. ♪ \ haidi: earlier guests weighing

in on whether china remains investable. we will hear from mark mobius in a moment, but the china goal and common prosperity has led to crackdowns across several industries including technology, education and property and is showing no signs of abating. let's bring in our china editor rebecca wilkins and chief north asia correspondent stephen engle. rebecca, we continue to hear warning that the property sector clampdown could be going too far. rebecca: yeah, more and more economist are coming out who ward this could be china's [indiscernible] moment and bank of america now out with a research note saying the property sector may have gone too far. that they have been unnecessarily aggressive. and we are seeing the result among defaulting china at the moment. once again this record wave of

defaults. and we are seeing stress breaking out, not least that ever grand. haidi: i feel like a broken record because i feel we do this pulse check every day, but are we seeing signs of contagions? rebecca: among very similar, weaker, financial risky properties, we have seen this cohort of property funds that tend to move in tandem with ever grand when we see ever grand bonds drop. outside that, contagion looks relatively well contained. china-yield bonds are dominated by the property sector and returned to positive profit last month. shery: steve, we also are talking about the education sector and more scrutiny on tutoring firms as well. stephen: those have been

decimated on the market and we are seeing more regulation coming down. essentially, the authorities of beijing are saying these afterschool tutoring schools need to report to them on their status as nonprofits. until then, they are not going to be able to sign up new students or collect fees. that is in addition to earlier news saying that local governments will help set the fee schedule. this is also falling under the common prosperity theme, where a lot of parents have been signing up the kids to these schools to get ahead in life. and it has created quite a market for exuberant marketing, if you will, and a lot of pressure on parents. if they don't sign up, their kids over to be left behind. so we have seen fees rising considerably. so, they want to level the playing field, but they are also, some would say, going a

bit excessive been killing up this industry. haidi: we are hearing rhetoric from "the people's daily" and state media sources saying china will boost transparency, investors should the editorial says the overhaul, the crackdown is going to be ultimately for the best of the companies as well. stephen: there is a big debate going on in china, even among state media outlets, about the scope and depth of the common prosperity theme. a blogger put out an article praising it as a profound revolution. and some, even in state media, reposted that. it was subsequently taken down because it got misconstrued, or construed as an extension of mao 's cultural revolution. again, messaging has been mixed

and markets have taken the hit. but there are ways to find themes in common prosperity. we have seen that in the general prosperity index, not surprisingly beating the main benchmarks, and not surprisingly as well, that index of 30 stocks has no platform companies, no property companies, it is a smart manufacturing, consumers, some financials. is china un-investable, maybe in some areas, but in others, you have to find the sweet spots. haidi: great tracker, as you can see. you can find it on the bloomberg. china credit editor rebecca wilkins and chief north asia correspondent stephen engle in hong kong. you can join a q&a on the china prosperity drive and what it means for markets with our bloomberg experts at 7:00 a.m.

hong kong and beijing time wednesday. if you asked veteran emerging markets investor mark mobius, he disagrees with george soros, early china investor, overinvest ability. mark mobius says tightening by beijing actually makes it safer for investors. mark: i have been pretty positive measures china has been taking because it means they are moving more towards fair regulations, trying to create a level playing field. in some ways, the measures by china are making it safer for investors, including bond investors. i don't see where george soros is coming from in this regard. >> so you don't think it is an issue of national security of china starts cracking down to the point where any capital

investment in china they see as a state company? mark: i don't. the bottom line is this, china wants to become an international destination for investments. because they need more money. a lot of think china -- a lot of people think china has got all this mone, they have no problem growing, but they need foreign investments. so they're going to try to encourage people to invest in their companies, of course under the same conditions local companies have to operate. there is also the problem of data, concerned about the protection of data. and they have taken some measures already, but at the end of the day, there is going to be a much more exciting market in china. it is a large market, a growing market, and we certainly want to be there. the market has not performed very well, but that also presents opportunities. i think we are in a situation

where [indiscernible] becomes more important. >> how do you play china and you think there is more regulatory crackdown to come? mark: the interesting thing is that we are focusing on small and medium-sized companies globally anyway. but with the crackdown on the big boys in china, so to speak, medium and small companies are advantaged today and in a better position because there is going to be a more level playing field. i think there is lots of opportunities in medium and small sized companies. and president xi has now decided to open a market in beijing for medium and small-sized companies, which is going to be positive. shery: mobius capital co-founder mark mobius, and talking about george soros's call that

investing in china would be a mistake, but we have learned lack rock doubled down on their china investment, raising $1 billion for the first mutual fund. haidi: of course george soros lashing out on what he calls the blackrock china lender, reference to the world's largest asset manager to launch usual funds to chinese consumers and recommending investors tripled allocations to assets in the nation as well. putting this argument aside, for investors it is worth pointing out that they are too busy putting their money at work. it makes an interesting conversation though, doesn't it. shery: yeah, the fact they have to weigh the benefits against the risks of investing in china but it seems the mainstream idea right now, whether blackrock or goldman sachs, they are investing in china because of the rewards. we will have plenty more. this is bloomberg. ♪

♪ shery: taking a look at markets across asia, the nikkei hovering between gains and losses, gains in communication and utility being weighed down by financials on consumer discretionary after beth and expected second-quarter final gdp numbers with annualized growth of 1.9%. at the same time, a report we may see covid restrictions expanded. the kospi, down a second session. the australian benchmark weighed down by real estate and consumer staples. up nex it's moving day. and while her friends are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. it only takes about a minute. wait, a minute? but what have you been doing for the last two hours?

...delegating? oh, good one. move your xfinity services without breaking a sweat. xfinity makes moving easy. go online to transfer your services in about a minute. get started today.

>> el salvador, let's face it, it's on its back. it's got real problems. it's a bankrupt country. so they're grasping at straws with bitcoin but i don't think it's going to spread through the country. >> it's a little surprising that they pushed it as a medium of exchange so firmly when at the sovereign level it seems the most obvious thing to do was be to adopt it in its foreign exchange reserves. >> whenever you do a new technology rollout is there are glitches. so come back in six weeks or 12 weeks and talk about how it's working for the people of el salvador. doing things this scale is not easy. i've got a lot of faith that they'll get this right. haidi: guest of bloomberg tv speaking about el salvador's crypto push. let's get more on the rocky

start to their launch as legal tender in el salvador. it was met with technical glitches and a plunge in price. at one point bitcoin fell 17% drag oarg cryptos with it. sue, what kicked off the decline? >> there were a couple of things. there was a focus on the bitcoin experiment, el salvador being the first sovereign nation to adopt it as a currency. it had set up 200 bitcoin a.t.m. machines. we had a lot of investors buying ahead of the event and sell on the fact. then a technical clutch in the rollout of their digital wallet, many could not download the app. that was a problem befores to have resphosmed you go to the price you'll see a sharp drop in bitcoin which had been on the rebound. a lot of other assets dropped wit. it's important to note that this was the lowest level bitcoin had

been at in a month. if you look at the year to date chart what you can see is that this is the most significant event that's come after bitcoin had rebounded some 75% from that big dip in july. so layer on the one other aspect that was here, that was according to a lot of the trading data, some 36 -- 360,000 accounts for liquidated, and that had a lot to do, experts say work some derivative trades and lef ram. so that was a lot of money moving about in crypto. $3.6 billion in bitcoin alone. all of that juicing the volatility. but we have seen bitcoin steady and we did hear from the el salvador president who sent out a tweet that his citizens got to take advantage of the decline by buying on the dip. so the spin out of el salvador

is the glitches were resolve. they had the advantage of buying at a lower price. and they're putting a positive spin on this even though there are some in el salvador very uncomfortable with this and the polls show they don't favor it. a lot of focus on this. shery: supporters and detract yofers crypto have been watching el salvador closely. what's the narrative from dirchlt sides? su: we heard at the top of this segment from a couple. the c.e.o. of galaxy digital and founder, he said let's wait and give this time but he also said that he believes that crypto currencies are the new internet, the, you know, web 3.0 development. he said you just don't want to miss out on. so he sees things going much higher from here. it's also important to note that he is an investor in the u.s.

startups that created the digital wallet that initially had those problems. mark mobius, on the other hand, saying he doesn't think that this will spark other clints to adopt this currency. this is important as chart watchers say we're seeing bitcoin steady, getting close to 47,000. that's technical support for bitcoin that could set it up to move higher. shery: su kenan here with more on bitcoin. we can't dismiss el salvador, we talked about bitcoin and that's headline but we can't forget the human rights violations happening inside the country. human rights watch pointing to this with the executive director now tweeting this out saying the president is dismantling the democratic institutions in the country and much more alarming rate like hugo chavez did in

vens rayway la. if you continue to read his threat on these tweets, he talks about how this new president now is really controlling the supreme court in el salvador, not to mention the presidential limits and the powers in that country. haidi: that's right. back in may we know he fired the attorney general, replaced all the justice os -- justices on the constitutional court ecertainlily with hisall lies. that's how they managed to get the top court to allow the presidential re-election to take place. the vice president proposed more than 200 changes to the constitution, troops were sent into congress last year after opposition lawmaker december clined to back a loan to fund his security plan. so many red flags so many concerns there. we see that reflected in the marks as well that fear. el sal var do -- el salvador's dollar bonds retesting low within that emerging market space.

we continue to monitor that even as we say the big headline grabbing story is the venture into bitcoin as legal tender. let's get you to bonney quinn. >> house democrats among the key components of the bill. the ways and means committee proposing a massive expansion of social safety nets including coverage of hearing and vision benefits for medicare but hasn't revealed its tax hike on corporations and the wealthy to help pay for spending in the broader bill. a united nations watchdog said iran's new government is scaling up reduction -- production of highly enriched uranium while failing to resume cooperation with monitors. the iaea said iran's stockpile is close to weapons grade. this comes as talks to return to a 2015 nuclear deal reconvene late they are month.

the philippines will hold off on easing public movement restrictions as planned, keeping the current rules through september 15. the government planned to loosen curbs on wednesday but daily covid infections are near records. manila under restrictions with restaurants allowing only pickup and delivery. johnson & johnson's vaccine customers cut infections by about half. this according to a trial of almost half a million health works for the south africa. most of the infections were mild and it stops the majority of recipients from dying. south africa was experiencing a third wave of delta-driven infections. bloomberg quicktake, powered by 275 journalists. this is bloomberg.

shery: the economy grew but not quickly enough to eliminate the need for more government stimulus. kathleen hayes is here what recap. what's today's report telling us about the strength of the japanese economy? kathleen sps this is a rebound from a weak first quarter, shery. it's showing that businesses are stepping up and spending. that's the main reason it seems we got the revision up to, what was it, 1.9% from 1.3% previously reported and a drop of 4.2% in the first quarter. nothing like those booming back from the terrible quarters suffered in the worst of the pandemic attack on the economy but still moving ahead. business investment was revised up to 2.3% in the second quarter from 1.7%. strong global demand, strong demand for exports from the likes of the u.s. and some other countries seen inducing export-led businesses to put some money back into their businesses.

this is a different chart actually. this is looking at household spending. and that was a bit stronger in the latest report, not these numbers. these show three consecutive months of negative household spending. that doesn't make the third quarter look so good in the quarter we're looking at we can see consumption was revised up higher, from 0. #%. duvall yai was here on "bloomberg daybreak asia," here's her reaction. >> i'm encouraged by the fact that it was as strong as the preliminary prints suggested. it looks like the cap-x side is doing well. that's going to be important for the recovery into 2022. i think, you know, this isn't a great number in the context of things given how weak growth was in the first quarter and generally speaking in the third quarter unfortunately we do think near term headwinds are persisting.

kathleen: headwinds indeed and that's the big question. i asked about her thoughts on what she thought about the former deputy governor of the bureau, former deputy governor yam gucci, saying they should be setting a more realist inflation target. she didn't think that was a good idea. she's concerned about a rise in the yen even though in this interview he said japan is stronger now. i'm curious as to what your thoughts are? kathleen: i think, haidi, the b.o.j. is -- the question of changing, making it 1%, i asked thed of the b.o.j., i asked him the question when i first interviewed him three or four years here said you need to keep inflation expectation there is, anchored at 2%. i don't think they're set to do that. what is important isn't monetary policy but fiscal policy.

we know the extended lockdowns cover 75% of the japanese population. we've seen those weak household spending numbers. we've got, we've got a lot of elderly japanese who won't be encouraged to go out when the delta variant is out there. that's why so many people, again we love this chart showing how subdued spending has been recently. but bloomberg economic airks long with zumi said maybe we get a negative third quarter growth rate, by the end they have year things are looking better in part because whoever gets elected to succeed the prime minister and the lower house leks as well that person will probably add trillions of yen of stimulus. that's going to help growth recoverer by the end of the year. but we'll see. shery: kath lien hayes always with great context. coming up, asian philanthropy

discussion coming up live from bloomberg's radar event. you don't want to miss that. stay with us. this is bloomberg. ♪

haidi: bloomberg is hosting the second edition of radar tracking tomorrow, an annual dialogue series that brings together pioneers in government, business and finance to advance

innovative policies and philanthropies. the bridgewater founder is speaking with haslinda right now. let's listen. haslinda: what's your view on the drive to bridge the wealth gap? >> well, we have a big problem with the wealth gap. there are cycles in history. i studied the rises and declines of empires going back over a period of time. there's a cycle. capitalism is a fantastic way of making a lot of money. and -- but it has a cyclical component to it. it distributes that wealth and opportunity unevenly. and it creates, when i say the opportunity that also means that those who are better off can give their children better education. and so on. and so it becomes an unfair

system with great wealth gaps and sometimes it becomes a an everily indebted system like we have now that set of circumstances throughout history has produced conflicts and problems. as well as inequities. i think we're going through that type of cycle right now. so you could see in periods, i won't recount them, but you could see the swings back and forth that would become, let's say, capitalist and anti-capitalist or elites and then revolutions. and those kinds of things. and we're in one of those cycles now. it is not an equitable system, by and large. i know this intimately. my wife is involved with particularly dealing with the most disadvantaged students in the worst school districts in our state. and the circumstances in terms

of the amounts of money and resources are all -- it's criminal. so that cycle swings and we are in the swinging of that cycle and that's what -- what i saw in china. very interesting. when we first came to china, there was no philanthropy in china. none. wasn't even legal. so the only way we could do it was because the person who was responsible for the regulating us, the bureau of civil affairs, knew what we were doing and we were doing that. well now, as part of the redistribution or sharing of the wealth, there's more of that going on. some cases it's being encouraging. some cases, in one way or another through taxes, through monetary policy, through philanthropy or what not,

there's a force for it to happen. in my case or some cases you know, that's part of an evolutionary process. if we're dealing with multigeneration families and you look at the second generation and you're looking at, let's say, asian families, for example. their first generation, like i'm first generation. as they go through that, they'll find that their next generation as well as them will find this as an important activity. and so to develop the skillset and so on is a natch pal -- natural part of the evolution. i think the important thing is to enjoy it. haslinda: ray, common prosperity to encourage the wealthy to give back more to society is necessary. >> one way or another we have to move more to an environment of equal opportunity. hopefully to produce greater

productivity through equal opportunity. but also to reduce that wealth gap. that's opportunity gap as well and wealth gap thing and wealth redistribution is in the swing and that will happen. philanthropy, and then there's how one individual feels about philanthropy. you know. you have to go to what you feel about philanthropy. i'm reluctant to say there should be something. ideally you follow your passions. but in one way or another, philanthropy, i think, is a good opportunity to redirect it. it's preferable probably to having the money taken from you and paid in taxes but i hope people will follow their passions. haslinda: you set up from the office here in --

haidi: that's ray dalio speaking to haslinda amean at the bloomberg radar event. now china opening up its mark for trading green energy making it easier for multinationals from b.m.w. to airs but to buy wind and solar power and reach aggressive emission goals. for more, bring in jeff sutherland. what exactly is china going and how does it fit into the overall global energy picture? jeff: well, as you said, china is opening up its markets for trading green energy and expanding the power trading centers throughout the country, throughout about 17 provinces that can help make contracts between the renewable energy company and the electric user. that makes it easier for companies, especially foreign multinationals, to buy cleaner electricity. and for the broader picture,

china has been pretty aggressive in its plan to reach carbon neutrality by 2060. it's been a leader in renewable energy through its wind and solar projects. but it's been slow to make that clean energy widely available throughout the country. and also despite the push they've been doing, china is still a major polluter and its electricity glid is still growing mostly on coal. so this latest move is another step toward reform and expand the country's power system. shery: is this something that largely helps multinationals? jeff: well, first of all, china is one of the biggest -- if not the biggest, market for many multinationals. and these companies are trying to shrink their carbon emissions footprints. but it's been frustrating to make progress in china.

many of the companies operating there are in regions that may not have easy access to renewable energy. but another big problem is that china's energy grid lacks transparency. companies had been able to make contracts but there's no guarantee how much they're getting is really clean energy. injure never-before-seen -- european giants have been demanding more access to green electricity and green electricity. shery: toyota is planning to spend $30 billion on the supply and development for batteries for its hybrids and electric vehicles. so how is this money going to be spent? >> it's looking to spend upwards of $13 billion by 2030 on securing its supply of batteries

so it is forecasting it's going to need about 200gigawatts of batteries by 2030, significantly higher than its previous estimate. the bulk of that money, about $1 trillion -- about one trillion yen of of the five trillion yen will go to building production capacity, installing new lines for battery electric vehicles specifically. it's going to set up 70 new battery lines by 2030. so that's a bulk of that spending. the rest of the money will largely go to research and development. toyota has a number of interesting battery projects in the works. one is solid state badry -- batteries. it's the this next generation type of battery to increase the range of cars. toyota is looking to put those battery into practical use in the early 20 20's. >> how does that spending compare to other major automakers? >> it's a big picture for detroit but the second largest

automaker, volkswagen, is looking to spend $29 billion by 2030, more than double the figure toyota announced yesterday. i think that does reflect a bit of toyota's strategy going forward when it comes to electric vehicles. so toyota has had a more conservative stance. it doesn't think there's going to be a great demand for electric vehicles over the next decade given that there's a lack of charging infrastructure in different regions of the world and hybrids actually have a smaller battery pack than electric vehicles. part of the difference in spending illustrates that toyotas sees hybrid vehicles continuing to command a lot of battery demand as well as make up a lot of its portion of fleet vehicles going forward. haidi: let's now turn to the late etc. business headlines, softbank unveiled plans to acquire 4.5% of deutch telecom and sell part of its tmobile

stakes to the german company in return. at the end of the swap softbank will hold about 3.3% stake in the u.s. mobile phone operator. medical devisemaker planning japan's biggest i.p.o. since 2018, hoping to raise $1.6 billion by selling 46.5 million shares, mostly coming from existing shareholders including k.k.r. almost six million will be new. chinese real estate firm oceanwide holdings is set to be looking so offload its main office complex in beijing in a bid to raise cash after one of its unit december faulted. it's been in talks but the potential $3 billion price tag is a sticking point. haidi: let's take a look ahead at what we're expecting ahead when the market opens in hong kong. lots to watch out for. >> a lot.

a lot. let me start with the equity markets. we've seen really a good run there across equity marks not just here in hong kong but in the mainland. 12 straight days of net inflows. we're pushing into some key moving averages for the first time in two months. the shanghai composite, i want to isolate that a little bit. it's about 1% of the new year to date high. that's the new equity story. the bond story pertains to credit and high yield. the yields and spreads back to the highest level since the height of the pandemic last year. that's more an ever grand stories. they're pushing close to the i.p.o. level of 3.5%. you look at the amount of bonds issued and the chunk of that making up the chunk of i guess the overall tie in and really you understand why spreads are winding. let me end on on a bright note.

there's a -- an editorial underscoring the point we've heard recently from policymakers that yes regulation is here to stay. but not this one. the other one. but that means they remain committed. also a good story. i guess to the point here they remain committed to the opening of the chinese economy. haidi, shery. haidi: thank you, david. that's it for "daybreak asia," we'll have more from david, the china open is almost upon us. this is bloomberg. ♪

david: good morning, it's 9:00 a.m., welcome to "bloomberg markets open," i'm david ingles. your top stories today, u.s. lifted chinese tech extending gains overnight. they hope the worst of beijing's crackdowns are over. at least for now. analysts are increasingly worried that china's attempting to cool the prop