paul: hello and welcome to "daybreak asia." i am paul allen in sydney. sophie: i am sophie kamaruddin in hong kong, counting down to asia's major market opens. shery: good evening. i'm shery ahn. our top stories this hour. asian traders assess a bout of weakness on signs of a slowdown in the pandemic recovery. the ecb is set to slow the pace of its bond buying.

christine lagarde insists it's not tapering. china's unprecedented intervention in oil market tapping into reserves the first time to lower prices. paul: let's talk a little bit more about that he be decision. christine lagarde slowing the pace of purchases to 80 billion euros per month. very clear it's not a taper. it is not a taper. madam lagarde saying the lady is not tapering. this is called a recalibration. we will donate -- debate the semantics of that, shall we? shery: given that we continue to see these signals from whether it is the fed or boe that they start to -- want to start unwinding stimulus measures, not surprising given we see inflationary pressures. china had to intervene in oil markets for the first time ever, explicitly saying they wanted to lower prices of raw materials, not surprising given the ppi

number we got overnight, right? paul: we had a bit of good news in australia as well. we got the roadmap on the thursday about what the easing of the lockdown here is going to look like. october 18 is the date set. we had 115 bay is on lockdown in new south wales. what that will mean is the reopening of pubs, cafes, hairdressers, and gyms, but with some limitations still in place. freedom day lights, shery. shery: we have had freedom day here in the u.s. for quite a while now. as the delta variant continues to rise, it has been a quasi-freedom where you are still wearing masks in some places. we do have more vaccinations of course. president biden has really tried to persuade more and more people to get vaccinated. 80 million americans still unvaccinated. he is now pardoning his stance. he will order all executive branch employees, federal

contractors, and health care workers to get vaccinated. let me turn to breaking news. this just happening while we were actually talking about these inflationary pressures and monetary policy. peru's central bank has just increased in the reference rate to 1%. this would be the most since 2010, this after inflation just breached at the upper limit of their targeted range. not to mention, they continue to see political turmoil. continue to see inflationary pressures not only in china with ppi numbers but also across latam. brazil as well, we saw the headline inflation approaching 10%. now, peru having to raise their key rates given that inflationary pressures are continuing to rise but of course, very tricky when it comes to latin america given that large swaths of their economy are off books so how much will rate hikes help is the

key question, paul. paul: very much with inflation top of mind, let's turn to sophie kamaruddin in hong kong for a check of the markets. sophie: after a soft handoff on wall street and two day drop, we are seeing a mixed start for the region. while we have seen the advanced stall, we still have that global market cap staying above $120 trillion. at jefferies, christopher woods still sees juice in this rally. a barbell strategy. this friday, nikkei futures in chicago paring back some of the overnight gains after we saw japan's stock rally falter on thursday. the advanced so far this month has seen the nikkei narrow the gap with the s&p 500. foreign investors have been piling into japanese stocks ahead of the leadership change. the economics team saying the balance has tipped in favor of the person whose policy moves towards micro as well as a focus on decarbonization which has been a boon for aluminum prices

which rallied to a 13 year high in london. some analysts warning of a peak in prices should demand momentum waiver. commodities are bullish, updating their forecast for aluminum to average more than $3000 next year on a tightening supply sector. shery: that's turned to vonnie quinn -- let's turn to vonnie quinn for the password headlines. vonnie: president joe biden is ordering all federal contractors millions of health care workers to be vaccinated against covid-19. the president also directed his administration to issue new rules, saying large private employers must require shots or testing. biden's as federal employees will face dismissals for not complying plus private employers could face fines. goldman sachs is dropping social distancing rules and returning to full occupancy starting next week. an internal memo seen by bloomberg says about half the bank's london workers are already in the office each day.

the bank will retain mask wearing in common areas and a mandatory tech -- testing program. bloomberg says ending free meals in the office will encourage support of local restaurants. 200 foreigners flew out of afghanistan thursday on a commercial light from kabul's airport, the first large-scale departure since u.s. and foreign forces ended there with ron at the end of last month. the qatar airways flight marked a significant breakthrough in the rocky coordination between the u.s. and taliban leadership. hong kong authorities have formally prosecuted seven organizers in a yearly vigil to commemorate the tiananmen square massacre. according to a post on the group's facebook page, they are facing charges including inciting subversion of state power and failing to provide information to authorities hong kong police say they also froze about $280,000 of the organization's assets. 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. slowing its pandemic bond purchases in a move president christine lagarde says is definitely not tapering. kathleen hays is here with a recap. if the ecb is not tapering, what exactly is it doing? kathleen: recalibrating. on the policy statement released by the european central bank the day after its meeting, christine lagarde and her official statement, the beginning of the press conference, said the economy is doing better and we don't need to support it quite as much. here is what she said. kathleen: favorable financing conditions can be maintained with a moderately lower pace of net asset purchases under the pandemic emergency purchase program. than in the previous two quarters. kathleen: let's move on to the

qme. -- q&a. is this the beginning of tapering? here is what met on the guard said. >> -- madam lagarde said. >> what it is doing is recalibrating. the pandemic emergency purchase program. kathleen: fair enough. that recalibration, they were purchasing 80 billion euros worth of bonds under the emergency program a month and that will be targeted between 60 billion and 70 billion, giving them some flexibility. the recovery is advanced enough that they can be maintained. still some concern about the delta variant kind of tripping the economy out, certainly a global resurgence in delta. is it tapering? i guess the main thing is lagarde also said they will continue overall their bond purchase program, $185 trillion through march of next year and beyond if needed. paul: all right. let's turn to another gray area.

a couple of federal bank reserve enough federal reserve, bank presidents are selling their investments. why is that? kathleen: it made news, the fact that they were actively trading investment. this is all on the up and up, in their 2021 financial disclosure date men's. all fed officials make these every year. drop kaplan, dallas fed president, doing more than a couple thousand million dollar plus trades. one story i read pointed out he was in some oil trades at the same time. he's talking about the oil in the economy, making decisions potentially that affect that. the person from the boston fed had some reit trades, real investment trust. they will diversify index funds and want to avoid any conflict of interest. it's also interesting in your friend's case that he has been warning for sometime about

commercial real estate. he watches it very closely. he is worried about frothiness. you could make the argument that may be because the investors are watching these things so closely, it makes him seem in tune to it. the critics will say that because he watches it so closely, somehow he has an advantage and that's why he is doing these trades. it remains to be seen how this plays out in congress because we know there is a lot of focus on the fed right now, a lot of people talking about who the next federal reserve chair will be, so i think it's going to be in the news for a while. paul: all right, kathleen hays there. let's get more on oil's reaction to that unprecedented intervention by china. stephen engle joins us with more. we know this move is designed to ease inflation so tell us more about the reaction we are seeing in the markets. stephen: obviously, the oil markets went down overnight, and it is really an unprecedented move by china as they are

tapping the strategic petroleum reserves which generally are there for times of shortages or times of warfare. but this is clearly a telegraph move by authorities in china that put out a statement that say they are trying to tamp down inflationary pressures and the prices they have been seeing. obviously, like many central banks, authorities in china are very concerned by inflation. what we saw with factory gate inflation, ppi in china, in august, up to a 13 year high of 9.5%, there is growing inflation in china. they are tapping these strategic petroleum reserves, which, you know, china has built up a lot of reserves over the past decade, 220 million barrels estimated. so they are obviously seeing this as a way, given the problems in the gulf with the u.s. oil exploration down by .75

after hurricane ida. we saw a pop up in oil prices before this announcement late thursday by the chinese authorities that they were going to tap their reserves and then we saw oil slipped by the most in nearly three weeks. shery: will this have a lasting impact? stephen: well, that's an interesting question. usually, china does not, you know, say what they have done. we have to rely on trade or talk to kind of -- trader talk to get a good indication of what china has done. if we look at their selling of other strategic assets, whether it is copper, aluminum, or grain. this time, they were clearly out ahead of that trader talk, saying exactly what they are doing. we will have to see if they will do that going forward, but in the past, with the selling of other strategic reserves, yes, there is an immediate impact on the and prices go down. that is the targeted effect. but over time, it does not seem

to last so we will have to see how that reflects in the market and whether they do, you know, relieve more. traders and consultants are saying, over the summer, they released between, what, 20 million to 30 million barrels of oil. at most, they could go 15 million more the rest of this year. shery: stephen engle, our chief martha correspondent -- north asia correspondent there. we take a look at the gender pay gap in australia and what can be done to close it with the director of the workplace equality agency in australia. up next, baines global head of macro research tells us why she is not too concerned about the fed and the ecb's tapering timelines. this is bloomberg. ♪

shery: we are seeing some

divergence in global central-bank policy. the fed and the boe signaled their intention to gradually unwind aid but the ecb is slowing its bond buying program pace only very slightly and christine lagarde continues to insist this does not amount to tapering. let's get analysis from the global head of macro research. great to have you with us. is this real policy divergence or is it just christine lagarde sort of signaling tapering but not really wanting to say that she is? >> if we look at what the fed has been doing relative to the ecb, yes, they are recalibrating, not tapering. there securities held on the fed's balance sheet, on reverse repose, peaked in april and steadily declined by over $1 trillion since then. although i think the more interesting question is not the tapering as much as what happens

for at least for longer-term investors, for companies, what happens if the fed no longer -- the cost of fed borrowing, the interests of which have declined for the past two years angst to interest rates coming down despite the debt itself rising by over $6 trillion. >> of course, a key part of the equation has been the inflation direction and the idea that this would be transitory. we saw the numbers out of china with ppi prices and we continue to see inflation surprising to the upside at least in the u.s. and europe. how does this really change the debate around the world? >> we have to try to piece out what today's inflation is. obviously, there have been price spikes we saw with number and then come back down. we have never had the experience of locking down, turning off the lights on the global economy in

a series of events at different paces, flickering the lights in some cases. china just had another couple of lockdowns in europe coming in and out of locked. australia. and this is going to create kinks in supply chains and supply demand imbalances. we are seeing challenges getting labor to on load containers and move them into ports in the united states. so all of that is truly a reaction to the measures, the economic measures we took to contain the pandemic but are not really the kind of spiraling inflation that we think of going forward. that is not to say we could not see that emerge, but i would be hesitant to call what we are seeing today anything more than the reflation and kinks being worked out as we reopen, close, reopen the global economy. paul: how is the timeline of the fed -- how does the timeline of the fed to preplan look to you? is there a risk of going too

early? >> the risk is more on the fiscal side than the monetary side. right now, there is so much liquidity that the fed is pouring liquidity into the punch ball with one hand and stopping it up with the other. so while the signaling of that may, i don't know what the impacts would be on the market, if there was a perception of it going too quickly. but i think we worry more that rather than attributing the change in economic growth that we have seen, the forecasts that have moved down quite substantially to the second half of the year as a normal -- moving back to a normal economy after this massive growth we saw post lockdown. if that is misunderstood to be meeting more stimulus, fiscal stimulus could be far more inflationary than what we might

see on the fed side and again, there is so much liquidity there that on most there were really aggressive moves, which neither the nor the ecb seems to have much appetite for, i would be surprised if that had a big impact. paul: i want to put another set mario to you. that growth recalibration, if it is not normal, and we do get inflation continuing to rise, where do you place the risk of stagflation? karen: where we are watching closely is what happens in labor markets. right now, every company that we work with is struggling to hire the workers that it needs. it is a problem, particularly in the united states, and we can see that the number of workers that are coming off the pandemic unemployment support programs, the number of workers that have apt off to the sidelines during the pandemic is greater than the number of job openings that we have. nonetheless, we do not know how

many of those workers are people who have retired and will not come back in. we estimate that could be up to 2 million. we don't know how many of the workers who were on that pandemic insurance -- unemployment insurance will come back into the workforce, and if we have that shortage of workers and that translates into wages, that can drive the stagflation that you are alluding to. paul: karen harris, head of macro research at bain and company. you can get a round up of the stories you need to know to get your day going in today's edition of "daybreak." bloomberg subscribers can go to dayb on their terminals, and this is also available on mobile in the bloomberg anywhere app. you can customize your settings so you only get the news on industries and assets you care about. this is bloomberg. ♪

shery: we are counting down to the start of trade in tokyo and seoul. some of the stories we are watching today. in japan, prime ministers suga just extended -- prime minister suga extended the deadline until december 30. on the politics front, toto news says it's minister will brief the press on his plans to run for ldp leader and of course we do have the market opens in about 35 minutes there at foreign investors piling into stocks ahead of the upcoming leadership change. foreign funds bought about $6 billion worth of equities and futures since suga's announcement that he will step down. that bok is expected to release its monthl report at noon. we are watching cookout and neighbor stocks after the government warned it will certainly respond if simtech firms show no effort to correct practices which could violate

local rules. north korea's leader, kim jong-un, reemerges at the first military parade since biden took office. there was a lot of attention paid to his thinner frame about speculation about his health, paul. paul: egypt's prime ministers as the taliban should be judged either actions and not their words. in an interview with manus cranny, he says he hopes afghanistan's new leaders can avoid the mistakes that they made in the past and maintain the basic rights of its citizens and he said the international community should give the taliban benefit of the doubt for the time being. >> i believe that now, with the new situation, we have to assess. we have to assess what is going to happen from the taliban based on their actions. we will not just assess the situation based on just the

statements. we have to see real action about what is going to happen. there was very good, i can say, there was some good statements that have come, but the most important thing is actions that would happen. and i believe they should not repeat or should avoid their mistakes that have been done in previous time when they have been assuming the leadership in afghanistan to have good relations with other countries. but again, let's wait and see and assess what is going to happen there in real actions, not just statements. manus: one other word globally i hear is about inclusion and how important that is to global perspective of this new taliban. what would signify a substantial

inclusion for you and for egypt? mostafa: the most important thing here is that they should respect all of their principles and of course the other countries around them and not try to export any kind of fundamental issues and even people for other countries, for neighboring countries. this is very important. we have definitely to maintain also the cries of their citizens, which is important and to show that they are coming to try to develop and improve the country. this is, i believe, for any citizen, this is the most important thing. to secure basic needs and maintain his rights to move in decent conditions and not to be obsessed by any fundamental food

or anything. shery: the egyptian permits or, mostafa madbouly, speaking with manus cranny. we will have plenty more to calm on "daybreak asia -- come on "daybreak asia." this is bloomberg. introducing xfinity rewards. our very own way of thanking you just for being with us. enjoy rewards like movie night specials. xfinity mobile benefits. ...and exclusive experiences, like the chance to win tickets to see watch what happens live. hey! it's me. the longer you've been with us... the more rewards you can get. like sharpening your cooking skills with a top chef. join for free on the xfinity app and watch all the rewards float in. our thanks. your rewards.

vonnie: this is "daybreak asia." i am vonnie quinn with the first word headlines. robert kaplan and eric rosengren say they are selling all their stock holdings by the end of the month amid ethical concerns about their trading activity. the dallas and boston fed presidents released near identical statements thursday after their financial disclosures and showed investments in a variety of stocks and other financial instruments. both said they will invest the proceeds in diversified index funds for cash. the slowed the pace of its bond

buying program slightly and what president christine lagarde insisted was recalibration that does not herald a wind down in melissa. the bank will conduct purchases at a moderately lower pace and roughly 80 billion euros a month , citing the economic rebound. officials left rates on hold and raised the ecb forecast for 2021 growth and inflation to 5% and 2.2% respectively. >> the lady is not tapering because what we are doing is recalibrating, which i will remind you is the pandemic emergency repurchase program. vonnie: oil backtracked as investors honed in on china's decision to reopen crude reserves. beijing says it released oil from its strategic reserves to try and alleviate pressure from rising raw material costs. food prices briefly rose after a report saying production fell by the most on record due to

hurricane ida. kim jong-un has shown off a trace of a tan and a new haircut. no major new weapons were on display with all men security a greater focus at the first military parade since joe biden took office but the new look at kim is drawing attention after his noticeable weight loss. 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. paul: all right. let's get a check of the markets now. sophie kamaruddin is in hong kong. sophie: nikkei futures in chicago a touch softer but we could see consolidation for japanese stocks with the nikkei 225 potentially on course for a third weekly game and the yen looking little changed early this friday morning after the biggest advance in about a month as we saw the dollar fall with yields following the ecb

decision. let's check out what is going on with oil. new york crude at $60 a barrel, set for the first weekly drop. jp morgan are taking docs of the multitude of factors in on the balance, they see no change to the expectation for a deficit so they are sticking to their crude forecast. i want to show you this, what is going on with cookout and neighbors. set for one of the worst weeks ever for the stock. neighbors shed more than $10 billion amid that rout on regulatory woes. and the pressure is likely to continue going into the march presidential election in south korea as lawmakers attempt to emphasize protecting consumers over corporate's, which is what eugene investment analysts say. at samsung securities, they see that regulatory concerns in south korea over the internet sector are overdone. company is able to continue their simtech services. shery. shery: looking forward to that

market open in less than half an hour but first, president joe biden will order all executive branch employees, federal contractors, and millions of health care workers to be vaccinated against the coronavirus. he also directed his administration to come up with moves to mandate large companies to require shots or testing. pres. biden: some of the biggest companies are already requiring the spirit united airlines, disney, tyson's food, and even fox news. the bottom line, we are going to protect vaccinated workers from on vaccinated coworkers. shery: let's get more from kara wetzel. does this mean that the administration is toughening its stance on vaccine mandates? kara: you can sense of some real frustration from biden in his speech, talking about how he is running out of patience and there are 80 million americans who have yet to receive the vaccine, so this is him trying to make a move to get people off

the fence and by going to their employers to kind of force the issue. we have seen many companies as biden said, already in brace mandates. we had a story out today, doing analysis of 100 u.s. companies, showing that half have. the new order with the full force of the president behind him could spur more companies to move ahead and do those types of moves as well for their employees. paul: has the vaccination rate in the u.s. started to plateau, and is this action going to make any difference to them? kara: we have seen increasing vaccinations since august with the delta variant and also with the approval of the pfizer vaccine by the fda that spurred more companies to come go ahead and require the vaccine and get more people off the fence to doing so. the vaccination rate hit 75% for people who received a first dose after reaching 70% in august so there has been some movement on that, but there are a fair

cohort of people who say they are never going to get the vaccine. one recent survey said 15% of americans said they had no interest, they will not do it, so there's going to be some people it will be hard to move the needle for, as we are finding out. paul: san francisco bureau chief kara wetzel there. let's tuned to japan where premise or yoshihide suga extended the virus emergency for tokyo and large parts of the country to september 30, and this as high levels of delta variant infections strain the medical system. there is unrest brewing among tokyo's bars and restaurants which are taking the brunt of these restrictions. let's get over to our tokyo deputy bureau chief, sophie jackman, for more. sophie: a state of emergency sounds very intense but the state of emergency here in japan is not legally binding. the main restrictions, as you said come on bars and restaurants, not to serve alcohol. they have to close at 8:00 p.m..

but very hard to enforce him and earlier on in earlier states of emergency last year and this year, we saw a lot of voluntary compliance by individuals and business owners, and some of those business owners are now rebelling. official statistics here in tokyo, a survey says about 4% of businesses surveyed were openly breaking the rules. it is likely to be much higher than that in reality. if you want to get a drink in tokyo right now, you can. and this state of emergency is set to last until the end of the month. the eye has been on hospital capacity and trying to increase that. numbers here in tokyo, although the delta variant is probably dominant -- predominant, total case embers are going down. if capacity can be increased in numbers decline, we can see it and on schedule. shery: -- end on schedule. shery: how would a reopening in japan actually look like? kara: prime minister suga

announcing the extension of the state of emergency last night and also hinted at japan vaccination certificates and test results in the future to try and alleviate some of these restrictions. that was music to the years of business owners. it remains to be seen exactly how they will do that. local media is hinting at a removal on restrictions on large gatherings and a shortening of the quarantine period one has to go through when entering japan as a vaccinated person. this will all be done in the future and the person implement in these measures will not be prime ministers suga. as he just said, he will resign. the election to replace him as party leader will take place on september 29 and all of the candidates have very much been focused on covid. one of them is the current vaccine minister. he is very knowledgeable there. the other is promising a pretty big fiscal package and some reforms to the way that the health system deals with covid as well so that will be very exciting in the next couple of weeks, seeing how suga's

successor promises to take care of the virus. paul: what is the mood on the street like? how are people in tokyo feeling about the virus situation? sophie: there is a feeling of exasperation among individuals like you see with business owners. people are still going out and about. you have had several states of emergency now and compliance with them has ebbed as each one has been extended and extended. people here are looking forward to see what the change they bring about. they are focused on vaccination. vaccination hesitancy here, certainly the fear, but it has not raised its head yet in these statistics bear there are people who want to be vaccinated and are willing to queue. shery: sophie jackman with the latest on the pandemic in japan. we continue to drop the global vaccination campaign with more than 5 billion doses given across 183 countries so far. check out member exact seen tracker on the terminal and -- at bloomberg.com.

coming up next, in our bloomberg equality segment, we will discuss the gender pay gap in australia and ways to tackle it with the director of the workplace economy ministry. this is bloomberg. ♪

paul: gender equality in

australia is showing little sign of improving. by one measure, it actually got worse in 2021. the country's gender pay gap has risen with new research showing on average, women earn almost $200 less per week than men. here to discuss, we are joined by the woman who oversaw that report, mary woolridge, director of the workplace gender equality agency. just give us a snapshot of where we are at in terms of the gender pay gap in australia and why things got worse. mary: thanks, paul. the gender pay gap increased, the first increase in five or six years, so it is a turnaround from the trend that has been happening and that represents the difference between men and women's earnings, $261 each week and that his knee -- ordinary earnings. the reason that the ads

attributes to the increase is a growth in men's wages. the construction sector is 88% male employees. therefore, the differential increasing. paul: digging deeper into your research, you identified a couple of drivers of the gender pay gap and that was industrial segregation and occupational segregation. can you tell us what they are and how they play into this? mary: industrial and occupational segregation contributes to the gender pay gap significantly. we had some industries such as health care, social assistance, retail as well in industries where there is predominately men working. we also saw in terms of roles that women take on, which tend to answer dominantly can be administrative roles or other roles at once again are lower paid.

across those industrial differences and occupational differences, industries that are more feminized tend to be lower paid. there are other contributors to the gap as well. women's careers being disrupted by family and caring responsibilities, it's a significant contributor to it. and also underlying gender discrimination in relation to hiring, promotions, and pay, is another significant contributor to the gender pay gap. shery: how important are pay audits accompanies in closing this gap? mary: we call it equal pay day, the number of extra days that women need to work compared to men from the end of the financial year to earn the same amount and it's about an additional two months. we are calling on companies to conduct gender pay audits so they understand those pay differentials.

this is not like to like. it is looking at the workforce as a whole and what women are paid, what men are paid, and where the gaps and differentials are. companies not only need to do the audit but then take action when they realize what those differences are and how they can close that gap. shery: especially when it comes to taking action, how has it helped to have women in corporate boards, not to mention senior management? mary: very significant. it sends not only a message in terms of the leadership and the commitment to making the change in being equal in terms of men and women and their leadership opportunity. we also found through research that the more equal in terms of gender an organization is, the better they perform financially. not only is it the right thing to do, it is also good for company performance in terms of the outcomes of having a better equality in terms of their

leadership and organization as a whole. paul: generally speaking, how engaged do you find australian employers are in addressing this problem? does it vary from employer to employer? mary: it does very. -- vary. every company with more than 100 employees is required to report to us on their gender equality performance. pay, workforce composition, and their policies and strategies on these issues. so that process in and of itself requires companies to understand their information, think about it, and report to us. but we also see some leading examples of companies striving to make the change to reduce gender pay gaps, being proactive on paid leave -- parental leave. there is an opportunity for all companies to realize it is going to be beneficial to them to ensure that they have an equal

workplace environment because that will create not only a great environment to work but better financial returns. shery: thank you very much for your time, workplace gender equality agency in australia director, mary woolridge. as mary was just mentioning, it actually has economic benefits to even out inequality around the world. we were talking about gender equality but there is this new study about the u.s. economy that inequality when it comes to employment, education, and earnings, has actually cost the u.s. economy $22.9 trillion over the past 30 years. one of the economies that released the study was the san francisco fed president, mary daly. take a listen to what she said today at a virtual panel. mary: the size of the gaps tells us there's some opportunity to even up those gaps and have better outcomes, not only for the workers, but better outcomes for dep. shery: this so much more

important now that we continue to see this on even recovery from the pandemic. -- uneven recovery from the pandemic. paul: mary daly saying it is not a zero-sum game. it is a case out of, you know, distribution -- distributing the same size pie equivalently, so this debate is ongoing. it is not going away anytime soon. you can be sure to tune into bloomberg radio to hear more from the days big newsmakers and get in-depth analysis as well from the daybreak team, broadcasting from our studio in hong kong. listen via the app, radio plus, or bloombergradio.com. plenty more to come. stay with us. ♪

paul: anker sells 1.5 billion dollars worth of smartphone accessories and other consumer electronics a year. bloomberg's chief north asia correspondent, stephen engle, explosively spoke to the ceo and asked about the challenges he is facing with the chip shortage. >> the shortage of chips is likely going to continue into mid of next year which actually has had and will continue to have impact on a fraction of our

production itself. also, we do not only produced in china, so we have manufacturers in vietnam and other countries as well and these are largely affected. we love part of the manufacturing capabilities due to that as well. even when the products are made and when they are about to be transported to the rest of the world, so we are seeing skyrocketing shipping fees. stephen: given these headwinds you have been talking about, does that accelerate or decelerate the companies switch -- company's switch to tap into the domestic consumption story in china? steven: we are looking at markets with a gdp over $10,000. so actually, you know, for the past few years, china's gdp has

crossed the line and we are seeing the demand really switching from, you know, more price driven versus into you novation driven, so -- innovation driven, so with this change in market position, i think it is really becoming a market that we should succeed in. stephen: over the next five years, how much of the revenue contribution would come from china? steven: what we hope is to drive it to 20% so it will be a period of three to five years. stephen: you focus on r&d and have advanced chargers and other home, you know, products, but how are you going to differentiate in a china market that is pretty saturated with kind of products you make? steven: we don't want to be a youtube brand or amy better brand. -- a me better brand.

we hope to be an innovation company. they come to us for a truly innovative product. so it is a challenge. it is a journey that we need to take, but that is something we are heading towards steadily. stephen: when you do have established names like jbl or other brands that are really known at this level and then there is everyone else, how do you -- is there a particular brand that you model yourself after? steven: probably a company like procter & gamble. maybe a little bit surprising but it has a portfolio that each is very professional and innovative, if you are able to just, you know, again, have the right people to actually build categories. individually by themselves, could be something different. it is something we kept thinking

and we will keep exploring as well. stephen: what other areas do you see yourself diversifying into? are there opportunities in certain product segments you are really looking at over the next few years? steven: we would hope to open up our platform to entrepreneurs all over the world to build categories they want to build. let's say an entrepreneur in japan wants to build a robot, something like that. stephen: how is your vision for anker -- how has your vision for anker been impacted by the tensions? let's not ignore the elephant in the room, the rising tensions between china and the united states. steven: we hope that anker would become an international company. they are not just made in china. they are made in vietnam and other parts of the world. it is designed in the rest of the world. shery: stephen engle exclusively

with anker ceo steven yang. let's get a quick check of the latest business flash headlines. a chinese ev maker is set to delay its planned listings in hong kong, pushing it to early next year. they received queries from the city stock exchange about its structure including a user trust set up in 2019. the u.s. traded company earlier announced the sale of as much as $2 billion in abr's, which some analysts say reflects further delays in the hong kong listing process. saudi aramco is pulling its gas production unit at the fuel becomes increasingly crucial to growing its chemicals business. sources say aramco will create two new divisions. the state run energy firm has been developing its gas fuel that is considering opening up a project to foreign investors. we are just a few minutes away from the major arc it opens across asia. what are you watching? sophie:

santos pending an announcement. we are keeping an eye on other oil companies in sydney and elsewhere in asia. switching out the board, we have already seen this from beijing as he attempted to cool the rally in metals. since then, the price has gone pretty much nowhere. at socgen, they see the copper correction continuing to end year prices. the outlook, paul, appears more bullish for aluminum prices. citi upgrading their already optimistic forecast, prices nearing 3000 dollars next year for aluminum. paul. paul: coming up in the next hour, china evergrande said to have received the green light to reset the terms of his debt -- its debt with bank and creditors. we will take a look at what is next with the general manager and head of investment. we will get more market insight as well from aberdeen standard investment's multi-asset solutions director.

those two conversations coming up. market opens in sydney, seoul, and tokyo, at the top of the this is bloomberg. hour. ♪

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>> >> hello and welcome to daybreak asia. i am shery ahn. i am in new york. >> i am sophie kamaruddin in hong kong. >> i am paul allen. our top stories. asian traders are seeing a bout of weakness and global shares and signs of a slowdown. china is tapping into reserves

for the first time. tencent loses more than $60 billion in value as beijing is gripped in tightness. >> we are seeing upside moves and japanese stocks. we saw the rallies fell on thursday. we have seen japanese stocks narrow the gap. investors have piled in and of the leadership change. yen is looking steady after the best session in about one month. switching on the board to turn to south korea now. the be ok due to release a report at midday. tech is very much in focus as regulars worn of stern responses. we are seeing shares fall at the start of trade this morning.

neighbor shares could be picketing up. -- picking up. we have seen a slump for sin tech companies. tencent dropped more than 8% in hong kong. we are switching on the board for the staggered opening in sydney. we are seeing an upside of .8%. check out the aussie dollar set for the first weekly drop. checking at the crude market, we do have oil set for a two-week rise with brent. mccoury is bullish on crude. you can see that $72 in the fourth quarter. looking at lme metal prices.

that pushed aluminum to a 13 year high. nickel went to a 14 year high. aluminum, we are seeing little change. we are seeing divergence when it comes to metal. we probably want to highlight that. have city predicting that aluminum will average over 3000 sellers next year. there was a peak in place the researcher warned it will be ending. quite the market cap for global stocks topped another milestone but the question is whether this rally is sustainable. joining us is multi-asset investor. ray, you say you have overweight equities.

are you concerned this bull run might be getting a little tired? are we looking at tapering? are we nearly done here? >> those are the facts and we have talked about them in great detail. a lot of that has been driven by the spread of consent on potential growth slowed and tapering on the horizon like you mentioned. we have a more optimistic view. we think there will be a lot more policy tapering. the u.s. is working on social infrastructure packages. we do think the peak of the covid wave in the u.s. will be behind the fourth quarter. we don't see a start of the down

cycle, we see a slight pause before markets continue. >> you sound confident that markets have priced in the taper. have they? >> here is how we read it in terms of how our outlook is looking and what will happen. if you think about this, markets have been well guided on how things have been. we did not see u.s. markets, you don't see asian markets at the top of the region. we do think markets are well behaved. in terms of taper, her expectations would be given the slight softness in the data. maybe 1.5% will be there.

>> we are not seeing any sort of taper talk in japan with the boj continuing to pump equity markets as well. where are you seeing the rally going? how much of that stimulus potential given the new leadership has already been priced in? >> we see a bit more juice in japanese markets. we see strong value indicating this will not be run in party elections. that is what we think will happen. the second leg would be slightly more. this will be driven by a couple of sectors. there would likely pick a candidate that would be popular. they will pick a popular candidate. the second, as you mentioned, it

would clearly a package rolled out close to the election campaign. this will help in terms of their campaign and votes. there is a valuation benefit in this rotation into japan and lastly, in our view, we do expect global units to increase. japan has high exposure to value and financial increases. we do expect japan to creep up. >> in your notes, you said you short south korea. why? >> it is an interesting one. here is how it is seen in our view. the price of korea in terms of equity markets has run up way ahead of it. our outlook on earnings is not

that strong. we do foresee that given manufacturing prices, it had a sharp rise over the last two quarters. we have seen a slight oversupply to meet with the pent-up demand. we expect that to stay true into potential earnings. we are done with revision earnings. risks are high. >> great to have you on, ray. that was ray with his outlook for the markets. let's get to vonnie quinn. >> oil backtracks as investors hone in on china's decision to open up food reserves, signaling it will not shy away from intervening in markets to lower domestic prices. beijing said it least oil from

its strategic reserve to alleviate pressure from rising raw materials. food prices reach highs after production fell by the most on record due to hurricane ida. the european central bank slows the pace of its bond buying program slightly. the president insisted it was a recalibration that does not herald a wind down. the bank will conduct purchases at a moderately lower pace at 80 billion euros per month. they raised the ecb forecast for 21 -- 2021 growth. >> it is not tapering. what we are doing is recalibrating this. this is the pandemic emergency purchase program. >> the fed president says they are selling all of their stock holdings by the end of the

month. this after equitable concerns about their trading activity. they released nearly identical statements to the fed president. both said they will invest in diversified index funds or cash. about 200 foreigners flew out of afghanistan on a commercial flight from kabul's airport. it is the first large-scale departure since they ended their withdrawal at the end of last month. the flight marks a significant breakthrough in the rocky coronation. global news -- 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. >> still to come, china ever grand is said to have received the green light to reset the terms of his debts with banks and creditors. we look at what is next with the

deputy general manager and head of investment, gary zhao. china made an unprecedented intervention on the oil market, releasing crude from the strategic reserve for the first time. details are next, this is bloomberg. ♪

>> china made an unprecedented intervention in the global oil market. releasing crude from its strategic reserve the aim of lowering prices. we know the market reaction was swift but i guess the question is how long it will last. >> that is right. this was a clear signal from authorities in china that they will use the strategic petroleum reserves to tamp down the rising prices of raw materials.

the world's biggest net importer of oil. this was confirming in a statement from the chinese authorities, a bloomberg scoop from late july that essentially said china offered 3 million tons were 22 million barrels of oil to major refineries. this was in an unprecedented move to tamp down inflation. releasing those reserves to domestic refineries would cut down on the need to import. as you said, the oil prices sank on the news by the most in three weeks. they had been up for that announcement. we are hearing that the output from the gulf, the u.s. output is down by about three fourths because of hurricane ida.

china clearly sending a signal that they are trying to use their strategic petroleum reserves. >> unprecedented as you say. this is the first time this ever happened. what does it tell us about whether or not it will happen in the future and at what point that oil price has to hit before we see future action? >> we don't know. generally speaking, these reserves and other raw materials, whether it is copper or aluminum, it is very rare, it never happens that the authorities will say what they did. it is usually trader talk has to decipher it. if you look at the leases of other strategic reserves we have seen in the base metals back on june 16, a sale of stock how base metals, copper, aluminum

and zinc. sure, there is an immediate market reaction but over the longer term, it seems to even things out. going forward, it is difficult to protect -- predict if they would do this again and what kind of lengthy dampening effect that would have on prices. priceless -- prices have seen change after that relief. july 9, they stockpiled corn release into the market. prices are down just 1.5% since. we have to see. that story from late july talked about china releasing between 20 and 30 million barrels of oil and traders we have spoken to say there could be room for another 10 or 15 million barrels released going forward but that is about it.

paul: the pboc is making use of one of his lesser-known monetary tools to support the economy. it is a move that suggests less need for broad policy cuts. what is the shift all about? >> it is about more targeted lending and cheaper lending. china has been shying away from broad-based systems for some time now. what the pboc is trying to do now is wrap up this relenting program they have now. and china's case, the idea is the commercial bank lended to smaller companies. maybe to farmers, those in the innovative space. you're getting money into the real economy at a cheaper rate. the idea is that it is a proper

tool that the pboc has gotten used to. they think they will grow that facility and use it. >> why this more targeted approach? >> we know the thing with china's economy is that activity is slowing down. they are hitting that 6% target. the authorities will be pleased. they are trying to keep things nudging in that direction. they are not about adding stimulus or supercharging activity. we saw those bloomberg trade numbers this week. on the ground, we know the consumer story is so so. the other reason is general discipline. the authorities are very strong

in preaching the financial risk. they don't want to go back to this. it is all about prudence in their own words. they are trying to take a more targeted approach. >> coming up next, more on china's textile off. all this as beijing looks to temporarily slow down new online game approvals. look at these japanese movers. we are seeing the a side. all this as they are having a very slow roll out of the new house imus disease drug by biogen. we are also seeing the fbi rally more than 4%. they announced a bid for this bank that would be the biggest

push into traditional banking. since a -- this company is not trading as of yet. this is bloomberg. ♪

>> traders rushed to dump chinese tech stocks as beijing moved to tempora slow down -- temporarily slow down new online game approvals. shedding more than 16 billion value. let's bring in our asian tech executive editor. tell us about the details of this meeting between regulators and is beginning stocks. >> earlier this week, for different regulatory agencies brought in the big gains companies and they talked about how they need to tighten their oversight of the games industry.

they emphasized a couple of different points. they said the games companies need to break their focus on making money out of this business. they need to move away from focusing solely on profits. they need to get on board with the government's goal of breaking gaming addiction of the country youth. they impose this will wear minors can only play three hours a week. -- they imposed this rule in which minors can only play for three hours a week. there is very tough talk about how the games companies need to get on board with helping the government with these restrictions. >> no longer we saw this something in the gaming stocks on these charts. >> i am glad that you brought up

the south china morning post report. they reported there was going to be a freeze on the approval of new games. the newspaper corrected that report and said there was not a freeze, they were going to slow down those gains. back in 2018, there was a freeze on game approvals that hit the shares of these games companies pretty hard, especially tencent. now that there is this slow down on the approvals of games, it is a little less serious. it means they need to get on board with the agenda. it is negative news for the games business overall but not as bad as the original report conveyed. >> we will be waiting for the china open to see how these stocks performed. you can get more context and analysis on china's crackdown on

its tech giants. this is available online on the bloomberg technology channel on youtube. here is a quick check of the latest business flash headlines. china ever grande is already contacting banks to request extensions. sources say they got approval to renegotiation -- renegotiate debt terms. $11 billion was borrowed with nearly half in less than a year. manufacturing of vehicles for sale in india will stop immediately and about 4000 employees will be affected. the ceo says he will no longer poor capital into buckets that

provide little to no return. bloomberg has been told apple has appointed one of its top software executives overseas after the previous leader left for ford. he is a veteran that joined apple in 2013 to run the software group for the company smart watch. this chinese ev maker is sent to delay its listing in hong kong. we are told that ne-yo received -- -- n eo received queries about a user trust set up in 2019. some analysts say this with >> for the delays in the hong kong listing process. >> let get you -- let's get you a quick check on the movers and

the asian-pacific. the aussie and the kiwi are one of best -- the best movers at the moment. the kiwi is also higher, 71.97. the korean won also pre-much flat against the u.s. dollar right now. coming up next, sidney could be among the cities to see an easing of lockdown restrictions soon. this is as the vaccination rate approaches the 70% threshold on october 18. this is the day we may see some restrictions easing. we will get you some details on that story and a check of the markets for you as well. this is bloomberg. ♪

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>> this is "daybreak asia." president biden is ordering all executive branch employees, federal contractors, and health care workers to be vaccinated. the president directed his administration to issue new rules saying large private employers must require shots or testing. biden says federal employees will risk dismissal for not complying. private employers could face fines. goldman sachs dropping social

distancing rules at its london office, returning to full occupancy starting next week. an internal memo says about half the banks workers are already in the office each day. it will retain mask wearing in common areas and mandatory testing programs. goldman says ending free meals in the office will encourage support of local restaurants. hong kong authorities have prosecuted seven organizers of the yearly vigil to commemorate the 1989 tiananmen square massacre. according to a post on the group's facebook page, the seven are facing charges including inciting subversion of state power and failing to provide information to authorities. hong kong police say they froze about $280,000 of the organization's assets. north korea's leader kim jong-un has showed off a trace of a tan and a new haircut as he inspected a military -- homeland security is an greater

focus at the country's first military parade since beau biden took office. the new look is drawing attention after his noticeable weight loss over the past few months. the united nations said it was the subject of a cyberattack in april. the cybersecurity firm says hackers appear to have gotten in by purchasing an employee's stolen username and password on the dark web. the u.n. said the attackers were successful in reaching parts of the infrastructure and that further attacks have been detected under a link to the earlier breach. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. >> australia's most populous state is planning to lift stay-at-home orders in some regional communities as new south wales unveiled a roadmap to end the weeklong lockdown. let's get more from our sydney bureau chief.

we got the roadmap yesterday, what was in it? >> we can look forward to enjoying more freedoms once new south wales hits the 70% vaccination target, which we are expecting toward the end of october. the government laid out a lot of it's methods to get double vaccinated. people will be able to go other people's houses, movie cinemas will reopen, pubs, sporting events. that is only going to be available to everyone that is double vaccinated as of the opening day. >> how uniform will the reopening path be among states? >> we are at very different stages at the moment. the second most populous city, melbourne is in lockdown. they are having a surge in delta cases. other states are still at the covid zero position. they are enjoying quite a bit of freedom and they are very reluctant to reopen their borders to states like new south wales and victoria, where we are seeing that delta surge. we are a country divided at the

moment in terms of the covid reopening outlook. >> october 18 nominated for relaxation of restrictions. it is not exactly freedom day like we have seen in the u.k., is it? >> there will still be restrictions in terms of capacity of venues, mask mandates, things like that. i expect it to be a gradual reopening. the government has said when we hit the target, we can expect to see some more reopening, more freedom i guess, in new south wales. >> we are seeing more risk on sentiment in early trading across asia. let's turn to sophie for what to watch. >> the week on a brighter note, the regional index on course for a third week of gains. christopher would sees more

juice in the rubble -- the global rally. the cyclical heavy japanese market moving higher led by financials. jeffries, they see more upside, saying no matter who wins the premier role. fluctuations for the kospi, but korean air rising after malaysia approves a merger. fintech names have been under regulatory scrutiny. we are seeing moves higher. neighbor up more than 2% after the rout. switching out the board, china's slowdown in new game approvals. some say it allows the industry to ensure protections.

we are seeing a mixed bag elsewhere. nintendo gaining some ground. a quick check on lg electronics, shares jumping this morning by as much as 6.4% in seoul amid reports apple card has sent a completion request to parts makers globally. >> a plan to allow investments for private wealth between hong kong and greater bay area is set to start soon. the hkma will be holding a press briefing on friday. jonas, what is the timing of the reasoning for this? >> as you said, there is a press conference scheduled for this afternoon. they will unveil the more precise plans. they don't quite know when it will kick off, but chinese officials said yesterday it could kick off within a few days. we will have to wait and see for

that. the program is a way of tying hong kong closer to the mainland and building financial stability during a turbulent period. it was announced in june last year right before the national security law went into effect. it has been lobbied for by major banks in the city who are looking at this as a big opportunity. >> what products will be eligible? >> from what we have heard so far, mainland authorities have unveiled -- this may not be that tied to mainland customers. but given the broad crackdown we see, it is an outlet for some investors to invest their money is an hong kong.

>> coming up, china ever grand's wild bond swings continue with some u.s. dollar bonds offering yields as much as 110%. that is assuming they don't default. we will discuss. this is bloomberg.

>> regulators gave the green light to ever grand to reassess debt terms after missed payments on some loans. onshore notes have plunged, highlighting the risks related to stress assets in china. our next guest says ever grand is so big, if it were to go down publicly, that would be systemic risk. the firm manages $270 million of chinese onshore and offshore bonds. great to have you with us. how encouraging are these latest news on ever grand? >> these news came at a good time. our approach to evergrande has not really changed. i think everybody understands

the top priority for the chinese regulator at the moment is to ensure the 1.5 million homebuyers who have a down payment on these housing projects will get their house delivered on time. it is the number one concern. comparing to that, everything else has to make way. when we are talking about the bank loans, evergrande could not make the interest payment on time. we were not too worried. it seems like the company is trying to find a more complete, more extensive approach to the debt repayment plan instead of just not being able to pay at all. what we see that is at the moment, the regulatory -- the regulator is helping evergrande make sure these projects are delivered on time. the same cannot be said for the interest payment, which is coming at the end of this month on those bonds issued by evergrande. >> not to just mention the loan payments, but also the ratings

downgrade from ratings agencies, right? what does this mean for the future of evergrande? is a default at play here? >> personally, i don't think the downgrading from triple c to double see has a significant impact as the one that happened earlier this year. it was in july, from single the to triple c. that should get a lot of sterling from private banks. this time the downgrade is more or less reflective of the current credit profile. because most people are aware of the situation around evergrande, i do not see a huge impact as to the market sentiment or the price itself. the risk of evergrande is always there, but as you mentioned, evergrande has such a big share of the chinese ust bond market

and also onshore lending through the banking system. i'm sure chinese regulators are doing whatever they can to make sure it will deleverage smoothly, but also making sure any other developers trying to attempt what evergrande has done through a highly leveraged approach to their business will receive a very extensive warning sign in the future. >> this poses a real no-win situation for the chinese government. if evergrande does default, what does the government do? does it make an example of evergrande and let it fail? >> that is a good question. i don't think the government will step on the side and watch evergrande fail. we can learn from history we are a large property developer in trouble, there are two approaches. one is they can sell a lot of

equity stake to aoe which is what happened with greenland, or you can try to sell equity stake or good assets you may have, trying to improve your cash flow, which is what happened to one dow when it sold its hotel and leisure business. evergrande still has cards up its sleeves and the regulators will help it in terms of making sure the ongoing housing projects will be delivered. this will help evergrande to receive cash flow. on the other hand, we will see how much they will step in when it comes to the financial system. in terms of the offshore bond market, evergrande has a very large flow. investors in offshore bonds of evergrande itself, more than half is held by private bank investors at the moment. the other 40% is held by more or

less speculative institutional investors. those big-name investors from financial systems, onshore financial systems, have more or less stepped down from this company. it does not come as any surprise. >> so far the credit market contagion will remain contained. do you see it remaining contained into the future? >> i certainly hope so. if we look at the index itself, the bloomberg china high-yield index is averaging 12%, the same as what it was back in 2020, march, when covid hit. the underlying story is different. back then it was everything at the same speed. now the index is being dragged down by one of two large property developers. i think at this moment the sentiment is still fairly --

bonds are not affected as much, but within the property space itself, because there are quite a few -- maybe four or five developers including more than half the market share, it is very possible one of them goes into a more distressed state. in terms of the highly leveraged market, it could trigger some kind of a chain effect. >> thank you so much for joining us. tune into bloomberg radio to hear more from the days big newsmakers and get analysis from the daybreak team, broadcasting live from our studio is an hong kong. listen via the app or bloombergradio.com.

>> ken mullis says it is dangerous for business people to wade into political issues in his wide-ranging exclusive interview with bloomberg. he spoke about the growth of the m&s industry. >> the business has gone, like you said, 20 years ago it was a tactic. you went to the ge board, just to pick a name, and it was a tactic to get a strategic opportunity done, you might not do it. today it is actually an industry, meaning there are firms that are in the business

of doing m&a. giving money, 25 billion, some of them, i think we will see a $50 billion fund before the year is out, and they want to do transactions. they also delegate down to junior talent like we are. the biggest checkbook in the world 20 years ago was ge. today at 37-year-old at a major pe firm may have a bigger m&a firm than the fortune 10 did 20 years ago. >> do you think we will see a $50 billion private equity fund? >> definitely. people forget that when kkr did the big millennial fund, it was like $5 billion. that was only 20 years ago. i think kkr reported they raised $67 billion in the first quarter. so the acceleration of capital into private equity, the attributes, i cannot see why it would not happen.

>> add leverage, it is firepower of $350 billion. it is her markable. >> markets have grown. >> i have always known u.s. someone who will talk to anyone if there is business to be done even if it means catching a plane during thanksgiving dinner. what about china? do you agree with george soros that doing business in china is no longer morally justifiable because it is tantamount to supporting a totalitarian regime? >> no. the reason i don't agree is not that i have some -- i'm a business person. there are politicians -- the amount of business people that are getting involved in these issues because they think there's only one side of an issue -- look, the reason things are issues is because there are two sides to it. china is something our government should deal with. in my world, i try to look at

business as business, and i think there is way too much pressure, way too much focus on business trying to get involved in issues. most of these issues are 55, 45, or 60-40. a lot of people think there is clarity on what side you should be on and i think it is very dangerous. >> ken moelis speaking with bloomberg. microsoft is nixing a plan to fully reopen its headquarters by october 4. it says it can no longer provide a date to return to offices because of uncertainty surrounding covid-19. microsoft will move to a 30 day transition period providing staff lead time to prepare for its offices to reopen. the linkedin arm is making it easier for jobseekers to find remote and hybrid work. amazon unveiled its line of

televisions, escalating a battle with roku and google for the in-home entertainment market. amazon will offer two lines of tv's. it is already one of the largest players in the connective tv industry, having sold millions of fire tv devices. saudi aramco is splitting its gas production unit as fuel becomes increasingly crucial to its -- to growing its chemical business. sources say aramco will create two new divisions name southern and northern gas operations. the state run energy firm has been developing its gas fields and is set to consider opening up a $110 billion project to foreign investors. >> some breaking news now from here in australia. we have a trading halt. santos agreeing to the terms of the takeover with these

companies to merge. santos offering 0.62 of its own shares for every oil search share. santos agreeing to the terms of the takeover. both companies saying this will create a regional champion, $20 billion asia oil and gas producer. >> this is a time when we see pressure on oil prices. brent is down again, wti again. china tapped their crude reserves with the explicit aim of lowering prices across markets with brent headed toward that $70 a barrel level. we have seen a broad rally when it comes to the base metals space. right now a little bit of a mixed picture, but aluminum rose to its 13 year high not only because of the political turmoil in guinea, but because copper has surged to record highs this

year. right now under pressure, but buyers have to find cheaper alternatives like aluminum to make home appliances like air conditioning. one company planning to replace half the copper in their units with aluminum by 2025. nickel unchanged, but this after reaching the highest since 2014. a key component in ev batteries. let's turn to sophie for what stocks to watch. >> a no-brainer, keeping a close eye on chinese tech names. it becomes more challenging to call a bottom to the rout for that sector. we have seen the advances and the hang seng tech index. tencent shares lost more than 8% is an hong kong thursday. china halting new proposals. economists believe regulatory overhauls have come to an end, but it will take time to prepare

-- repair foreign investor confidence. in kuala lumpur we are keeping an eye on glove makers as the world's largest producer is set to resume exports to the u.s. this friday. in july last year, there was an import ban by u.s. customs. in taipei we are keeping a close eye on tsmc, do to report sales figures for august. it will offer a pulse check on the industry amid supply constraints. goldman says stronger revenue growth and probability from tsmc. >> let's have a quick check of what's happening in terms of market action across the region. a modestly risk on day unfolding. the nikkei higher by 0.5%. new zealand flat at the moment here in australia. we have the asx higher by 0.5%. the kospi just a very slightly is a negative territory.

we have the news that santos and oil search will enter that merger agreement, forming a $21 million asian gas and oil regional champion. we have an exclusive interview with mgm china chairman greg gilligan. we will also be speaking with the managing partner and cio at the market open. that is it from "daybreak asia." markets coverage continues, so stand by for bloomberg markets "china open." ♪

it's moving day.

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♪ david: good morning from hong kong where it is 9:00 a.m.. it is also 9:00 a.m. in beijing and shanghai. we are counting down to the open of the last session of the week. let's get to your top stories today. stocks across the region are up on hopes of slower stimulus withdrawal. we are