♪ >> a very good morning, welcome today break: australia. i'm heidi in sydney. >> good evening, from bloomberg's world headquarters in new york, i'm kathleen hays. g20 leaders fall short on climate change. president biden says china and russia didn't show up with commitments.

>> japan's prime minister defies expectations. the l.d.p. retaining its sole grip on power. >> and fresh record highs in the united states but china's weak manufacturing data may weigh on sentiment. so let's look at what happened on wall street on friday. it was a week of big tech earnings. dominating the headlines and by headline, people were looking back at the thursday recall -- result for amazon, apple. even facebook, earlier in the week that weighed on stocks at the open but at the end of the day, strong results from khem ron, exxon. for the month, it was up 6.9%. investigation the best month since november of last year. so overall a strong movement in stocks. you can see some optimism feeding into today. now for the familiar, another

optimistic start, holding on to those gauges. as for oil, the futures have just turned a little bit negative but still in that range from $83 to -- 85 a barrel. for the mlb of october, crude oil was up 11%. u.s. and other oil-consuming nations are going to try to get opec to please boost output and boost it now. tooking -- looking at the bond markets. a little bit of a gain in price drop yield today. inflation, and i want to pointout what we saw in the u.s. employment cost index on friday. if you look at this chart, you'll see you had actually the worst days of the m.s.c. all country index, that certainly on virus concerns but in the u.s. and employment costs, is .5%,

the number in the fourth quarter for wages. that is the biggest gain since 2001 when this series of data started. underscore people are concernedded about the labor market and wages and that's what we're starting to see so big here. heidi: -- captain lean: climate change and the g20 kind of a failure. they talked but russia, china, india all pushing back against some of the over things the other nations wanting to do and biden called them out. overall the g20 did not fails out the domestic use of coal, where 40% of emissions come from. and they didn't agree to keep global warming to a ceiling of 1.35 degrees above celsius compare tad to prep strip levels. about the only thing they could agree on and -- is that they're

going to try to reached it. but i love what mario said on this. it's easy to seg -- suggest difficult things and very difficult to actually execute them. haidi: yes, really fascinating when you look at the track changes from what we had inspect draft and how much of that was walked back, particularly pertaining to comb. this relationship by cambra and paris is not improving. we heard .macron say he thinks the m.p. lied to him about the submarine deep at the expense to five deese will-powered submarines to cam bra from france. he said i don't think he lied, i know he did. we'll continue to watch that

rhythm but another element of things that could get icy heading into the come 26 talk in glass go. kathleen: china is a big story coming into trading today, particularly in asia but around the world, the economy weakening. the p.m.i.'s now for. mlb of october for manufacturing and services. the mono-manufacturing p.m. -- p.m.i. matching down to 29 . 2. that signals contraction. for forever -- manufacturing, supply site issues. rising costs is hurting manufactures. for the services index, it felt to 52.4. still above 5078 but that was way above the estimate and there you have covid deemo andth keep things locked down. that hurts spending but definitely a big, big story for

markets today. haidi: we'll be discussing the results of the elections. the question going forward is does that give him enough cent and power in his own party to go on the next few months as prime minister? but he did need to gain a certain number to receive that majority. as we continue to watch the market reaction. speaking of the markets, a pretty positive start to the week here. future trading in chicago up bill 1.1%. as we get some political uncertainty from that japanese lennox lewis and also saw a

rise. sidive futures up about 1% as we get the resumption of international travel to certain destinations. a big -- if you're looking to travel to london or new york. long waits expected at the airport but in new zealand we're seeing a little bit of a muted start to trading there. .3% lower. it managed to secure enough house seats to keep its outright majority. we'll go to david in hong kong. they did lose some seats but certainly knot as bad as the opinion polls we saw last weak suggested. >> no, this was a wild card selection. he took that roam october 4 and a general assembly was confirmed

very quickly. it could have been much, much worse. in fact, there were some progeorgia techings that they could lose the single-participant majority but still hold only to the majority with its junior partisan ito. it was good and bad for the l.d.b. -- l.d.p. they held only to the party. some they did lose about 15 seeps. ito, though, picked up three. net they lost together about 12 seats there took. still, of course, these are reports from the likes of n.h.k. and the final tallies will come later. burr again, now is the time to go guard. he set the bar pretty low. he said my number one goal is to

hold only the on that majority, however slim it. please stand by. some he has his work cut out for him to bush remained with his apennetta. not only raise rages but bring up other things this volume -- coming during the pandemic while also spending big. the more controversial angle to that is defense spending. so the opposition than necessarily come through like they programmed. p.d.c. gang -- losing seats. >> thank you. stephen engel joining us in hong kong. no concrete deals were given on clearness.

perspective biden called out two nations in plan for holding out. perspective biden: not only china were you but russia basically didn't show up in terms of dealing with climate change. kathleen: wan kind of things did you hear on the sideline? >> well, the perspective really summed it up. he said he's generally disappointed regarding the weak language when it came to combating climate change. climate change was the most con tension issue at this 3:00 20. some of the language even mirrors what happened be agreed upon in 2013. a the paris climate accord. so biden made the point that not only russia and china didn't show up in terms of physically

at the g20 but he said they didn't show up in terms of their commitment to try to get more ambitious language. you have to think that the president he himself will potentially fails backlash. when you have the likes of senator joe man sen from west virginia in comb country. not wanting to go as aggressively for his economic plan but there is where you saw a lot of the developed world vs. the developing world. kathleen: emily in rome as we look ahead now to those talks in glasgow. french if the macron isn't ready to give morrison for the cancellation of a deal.

saying he knows that morrison lied to him. it does look it will take more time to heal this rich. >> yes, it does. perspective macron was talking to reports. and asked if he felt like scott morrison lieed to him over the cancellation of the deal, president macron said imdon't think he lied, i know he lied. president macron not ready to forgive just yet. this relates toments deal that australia signed with france. france was blindsided by the announcement of the alliance and parts of the alliance was the cancellation of that sub's deep perspective bided called the handling of that whole issue clumsy when he spoke with if the mac roan. the australian president pushing back on the idea that he lied

saying he was clear that those substance from france were not going to moment the country's strategic interests but perspective biden said this was not ok. >> let's go to the first word headlines. >> thank you. china's economy showed signs. the second straight month of koran -- contractionings. the non-manufacturing gauge well believe con sense us at 52.4. they took a hit from surging motte prices. the u.s. and european join reached an agreement on steam and aluminum. officials say the two sides worked to glance market hands in and climate change in the deep

china's goran minister says u.s. interference in its internal affirms through legislation and sanctions has seriously disrupted normal relations between the two nations. the the goran mini city -- mini strip says wang offered to establishing regular contact with blinken and urged the u.s. to get a true one-policy agreement. a coronavirus investigation at disney. the park said people would have to undergo a test when leaving. earlier it was reported that a guest had tested positive for covid-19. this is bloomberg.

haidi? >> still ahead, what's next from premier and his government after he cleared a low ball for the election. analysis only that. but coming up next, hear why -- strong corporate practices provides excellent support. this is bloomberg. ♪

>> taking a look at the week ahead. central banks taking the stage. three days of monitor action will reveal if policymakers share the same opinions on surging inflation. a decision shaping up to be a market-moving one. the governor and his team must confronts recent rising price and is attacks on the yield. the yield is now eight times the

r.b.a.'s target. the fed is expected to kick off on wednesday. talent attention turning to the o.b.o.e. or number. a cliff hanger decision. >> a lot more to digest outside monitor policy. the october u.s. jobs report expected to show acceleration after two months of disappointing data. meanwhile, cop 26 officially underway in glasgow. and opec will address calls to accelerate supply increases as the energy crisis spreads. commodity price and is supply campaign problems are still affecting the economy. policymakers give us their opinion. >> closed down businesses impacted things. >> however, the visibility remains pretty limited.

>> we should see an increase of semiconductors basically quarter after quarter. >> certain deliveries will come about earlier but overall it will take a good clunk of 2022 for it to be sorted out. >> we have a fully aligned supply chain when it comes to 2022 and 202. >> in the near term, supply bottlenecks and rising energy prices areles main risks to the pace of recovery and the outlook for inflation. >> and that's your week ahead. >> so let's bring in chuck lieberman. c.i.o., managing partner at adviser capital middleweight. interesting that the fed is going to start its tamer now but markets are in a different held space than they were even six months ago when they said it's going to be twins tour. everybody shook their heads and said yeah. there's so much inflation

worrying supply strain constraint. are investors going to be as much ised that a little bit of tamering is going to push back on inflation? charles : a little bit of tapering won't do much of anything. the fed will be reducing the amount of liquidity. the fed is still with its foot on the accelerate and a long way away from trying to richt the economy. kathleen: is the chair doing in you were? do you think that people are finally catching up when nine of the m said we see at least one rate hike next year but it's going to come possibly in july and the pace is going to stay high, especially with inflation rates so high. chuck: the fed is slow playing there. they know that a lot of the precious are not going to dispayment.

presenting it as transitory. it's going to last a lot longer. we see significant pressures in the labor market. employment costs, as you mentioned earlier in the show, are up sharply. that's not going to dispayment easily. the first shot at increasing the lake of labor comes this friday with the employment report. it's the first look at october. if you recall, a lot of the incentives for people to stale out of the labor market disappeared in early september but they randall that september report, september survey on the week that included the 12th so them very little data of people going back to work. hopefully that will be different in october but if it isn't then this labor market scarcity is going to continue for a while and that means a lot more outafford plush on wage inflation.

captain lean: are you looking at companies that can cope more with higher inflation or leafs pass on some inflation precious? chuck: there's no document that one of the teams in driving our important folios are inflation considerations. we are looking at companies that benefit from higher inflation. that would include banks because their interest rate margin should increase. companies with tangible assets. emily: and gas pipe liens or real estate. those companies are benefits of higher inflation and their profitability should increase as a result of inflation. >> so what does that mean for your fixed income part of the portfolio? chuck: it means that you have to be very, have been defensive and that's exactly what we're doing. we're -- we prefer floating rate issues over fixed rate issues is. there are a variety of ways to

protect against rising rates and we're going all of them. doctor rates are not at equilibrium level. the 10-year is at 1.55%. at that level, you're not even close to covering the fed's targeted rate of inflation let alone actual inflags and the 30-year is under 2%. this makes little sense. it's not sustainable. i. exists partly because felt are buying bonds very aggressivively. captain lean: as for the forward momentum, you've been in favor of stocks for several years and how long does that last and what stops it, if anything? chuck: i think what potentially stops it is surging inflation if the fed doesn't respond to it. if the fed remains very slow to respond to the data then

inflation will build up more of a he would of steel. larry summer has described fiscal policy as the most irresponsible since the 1970's. precisely what drives. inflation rates higher. that would be a major policy error. it could happen. it doesn't has to lamb and the fed needs to starts becoming more ail give in i'm sorry response. it remains tock seen. haidi: cluck lieberman. great to have you with us. you can get a round-up of the stories you need to know to get your day going. a subscription of daybreak or cum your setting so you get the news and the industrials that you care about. this is bloom berk. ♪ -- bloomberg. ♪

>> busy/headlines. a record share buyback of up to $6.2 billion. despite earnings narrowly missing expectations. the biggest legendser joined the other banks in an effort to buy back 13 billion on a stronger than anticipated recovery from the pandemic. oil output and prices pushed it up 30 billion. it's its c.e.o. expects energy demands about the remain high. and american airlines canceled more than 1,000 flights over the weekend, blaming weather for the destruction. the arum scrammed for than 6700 flights on sunday andsaid two days of severe weather kept

three out of five runways shut at the dallas-first time hub. plenty more to come on daybreak australia. a look into japan's kashida results with the goran affairs mini

haidi: try's economy showed signs of further weakness, power shortages and a surge in commodity prices weighing under the factoring, strict controls putting a break on holiday spending. let's get more from our editor just looking at that news that shanghai disney has been closed. we are clearly starting to see these restrictions hold up the economy again. >> it is turning into something of a lost year as it were for china's economy and markets. you are coming into the year,

there was a lot of optimism, try that with the first into the covid pandemic, it would be the first out of the covid pandemic and even in that command and control economy would allow them to more readily adapt to a post covid reality. instead they have struggled to pull the right levers. china faced a lot of demographic challenges and also the challenge of sustaining growth at the highest level it had been at. even as covid is starting to fade away or is not, as the case may be, investors are left both within china and abroad with this problem that china's economy is looking like it is going to be dragging for quite a while and that has helped to drag asian equities down so most horses around the region are down for the year. kathleen: property developers,

probably seeing a lot of them down for the year, seeking a $2 billion bond bill this month. what do you see there? >> what i see there is some of it are broader challenges. part of the problem is china is trying to fix the unsustainable property development situation created by decades of policies where pumping up the property sector was a big way of helping to boost the economy out of some trouble spots. you are seeing worldwide problems with potentially unsustainable housing booms in response to stimulus. this particular problem for china is a major concern both because as you say there are all of those bonds and a lot of international investors have

u.s. dollar bonds because they like the yields so much. there is a market contagion factor to this. the big concern is property is a huge part of china's economy and property investment is how chinese households put their money, that is where they go rather than to banks or the share market, buy property because the expectation is it will keep going up. people will always need somewhere to live or it will only have to go back a bit of a decade to see out poorly that kind of an attitude can play out. kathleen: garfield reynolds, under the perfect storm. let's go over first word news with vonnie quinn. vonnie: thank you. did it to the group of 20 nations have agreed on a climate deal falls well short of what members were pushing for.

the final communique offered little in the way of concrete actions in a married prior pledges made in paris. one sticking point was coal. they could only agree to stave out new investments. french president micron says australian president scott morrison lied about a pact between the u.s. and u.k. he was asked about the council deal to sell for an simmering source. the prime minister said he had been very clear in telling france the submarines would not meet strategic needs. china will release reserves of oil and gasoline. the strategic reserve administration did not say how much of the fuel would be released to move to domestic supply, nor did it provide a schedule. china as seen long queues of vehicles after some restricted

diesel's house. mcdonough says it wants more time to assess its covid-19 vaccine for children aged five to 11 over a rare art information. it seeks emergency approval for the intro. some countries have recommended pfizer shot for age -- males aged under 30. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i am vonnie quinn. this is bloomberg. haidi: japanese prime minister kishida and liberal party have maintained their hold on power despite losing some suites -- seats. let's get some analysis, currently the president for international monetary affairs. great to have you with us.

perhaps we overdid the pessimism it comes to opinion polls from last week. is this result enough for kishida to consolidate its leadership within the party? >> thank you very much for having me here this morning. certainly, i am sure prime minister kishida is in joining -- enjoying a bigger than expected victory because he can make control over the lower house. together his coalition party, he got 293 seats out of 465 seats in the lower house so that gives him a platform to speed up his policies on economic reform, as well as national security reform. haidi: some of the issues around

the economic reform agenda have been at of further debt issuance . what does the result mean for the economic mandate? >> first of all, how to make compatible policies, on one hand, how to deal with the covid-19, and on the other out to boost the japanese economy, and those two things are quite difficult to be compatible, so i think kishida will focus on bringing in the japanese economy, more robust development and growth. kathleen: how about his foreign affairs, particularly the relationship with the united states at this time. he is going to make is international debut at cop26 hoping to meet president biden.

what do you think he is trying to get out of that. what should he get out of that for japan? >> he was not attending g20 but he is on cop26 to be held in glasgow. that is a place where he is going to meet the leaders from all over the world. so his diplomacy will certainly start from cop26. mr. kishida has been foreign minister for nearly five years. that gives him about -- a good background to conduct his foreign policies. not speaking about the importance of our relation with china, how to deal with both the

united states and china in a positive manner. kathleen: what about trade? in many ways the pandemic is raging, this seems to be an issue on a back burner, has got to deal with china and taiwan becoming members of the tpp. what do you think is main goal will be? >> the tpp to be more precise is comprehensive, where japan played a major role in securing the result of the tpp negotiations, and at that time he was foreign minister, so he has a very good grasp or grip on

the content of the tpp, and with that he is going to play the kind of intermediary role between united states and china using cptpp as an emerging platform for those two superpowers and economic affairs. kathleen: thank you so much, yorizumi watanabe. we have more discussion on the outcome of the japanese election later with a former vice minister. haidi: australia's international travel resuming for many vaccinators residents. we will be discussing the reopening next. this is bloomberg.

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kathleen: you were watching "daybreak: australia." a big call by goldman, the fed is expected to rate hike a year earlier, up .25 of 1% soon after tapering asset purchase program.

we will see a second increase by november 2022. haidi: economists expect the rba to drop that you'll target, the april 2024 pondfield is already eight times the rba target, predicament the central bank find itself in, unexpectedly strong inflation around the world is really putting pressure on central bankers to rethink their policy time let's. millions of us trillions -- australians living on the east coast or finally led to trouble. restrictions are loosened, let's get more from our analyst. we are seeing commercial flights ties down into the airport this morning. what do we know about who is allowed to travel in australia? >> they are suggesting a four hour lead time so that might put people off even though people

are effectively allowed to travel overseas at the moment incoming flights are full of australian permanent residence who were repatriating. the government is going to about tourists from new zealand to quarantine one way as well. they are still quite strict that the away but tori is from new zealand can fly into sydney, melbourne quarantine free which will be great for uniting families. kathleen: what a joyous occasion, singapore is next? >> we have had some news overnight the travel bubble between australia and singapore should start, which will be greatness or people who have been divided a lot of time. the government has been flagging that for a while. haidi: when will the country's

borders open to more broadly for students and doris? -- tourists? >> the government is hopeful it will come before christmas, that will be for students. the broader tourism market should be up after that. haidi: a big day for people trying to leave australia and incoming visitors as well. it is not just flights being poked in a frenzy over the past few weeks, is everyone including even i, frequent flyer points we have not enabled use over the last few years, it has been a bonanza. 175,000 seat since qantas unlock those lights, that is enough to trouble to london and back in business class 15,000 times.

there is so much enthusiasm, even if it means that you have to get to the airport hours early, going through all of these additional tests and paperwork, people are so desperate to get out and see the world again. kathleen: oh my god, i can get on a plane, i can get on the airport. we always complained about how long it takes to get there, sitting and waiting. everybody is having parties those past four hours. it is interesting as we look at the story behind this, it looks like london was one of the top destinations for people to snap up their seats with the lowest number of pointers points -- qantas points. one of the reasons i do not use any frequent flyer points, reluctance of the u.s. were nowhere near as rich as they have been in australia, but

flights were supposed cheap -- so cheap. i expect people around the world between not being able to fly or not wanting to spend, you thought you could get it so cheaply, why bother, i think we will see a lot of this. also we will see what happens with a dharna -- moderna announcing it will supply additional doses to covax. it is said to seek approval to vaccinate children soon, the giant expected to submit data to local regulators. our guest discussed the plan to boost immunity with the bloomberg. >> we are very pleased the u.s. fda authorized the booster and the cdc. more than one million people have gotten the moderna booster.

a lot of people i know in france have gotten there boost -- their boost. >> also from london, how often do you think we will need a boost? >> i think it will depend upon your age. if you look at another coronavirus that has been with us since 1890, it was called the russian flume, which clearly was not the flu but i coronavirus pandemic, if you are over 50 years of age, you get sick every year. i can see a world where you might need a once your shot or once every two years. we have to look at the data.

one of the things we are working as a company to make people's lives easier is you get a flu booster and covid booster in a single dose. >> you have been saying that for the last few times we have spoken, and i wonder outlets would you be to creating something like that? an all-in-one seasonal booster? >> we are going to go to the clinic very soon. we are going to start a phase, then we will combine it. best case scenario will be 2023, 2024 timeframe. several countries are being more conscious so we will see or difference in the world unaware it will be available. >> how safe do you think your

vaccine for five to 11-year-olds is? >> it is very strong in terms of safety, so we think the vaccine is safe. we think it is not an issue. >> can you talk about the announcement today at you were going to be sending over 160 million shots to covax the second quarter. the biden administration has criticized you for not sending enough doses to africa. is this part of that response, and if not, is there more you can send and what is the timeframe for that? >> when the pandemic started moderna wasn't 800 person company, we had never sold the product, and no industrial experience. we set the goal to make $1

billion for 2021, which was an extraordinary number. the entire flu market worldwide across many large companies is $500 million. it was 10,000 times more product we were to produce, and at the time we made those decisions, in march of 2020 at the beginning of the pandemic we thought the big pharma companies would get vaccines. assuming the moderna vaccine will be showing the highest efficacy and duration of efficacy. we are trying to make more. haidi: the moderna ceo speaking exclusively with bloomberg on mr. schatz. here in australia we are seeing booster shots, the pfizer shots

across states. anyone who has previously at their second vaccine six months or earlier are eligible to get that shot for today. tune into bloomberg radio to hear more from today's newsmakers and get to breaking analysis. we are live from our studio, listening via the app or bloombergradio.com. much more ahead. this is bloomberg. ♪

haidi: let's look at the day ahead for australia, prices with the monthly inflation reading from an institute of social research. initial public offerings have been on a tear as well as having beaten hong kong for ipo's for the first time since 2016. earnings nearly missed expectations. let's get more on that from our finance reported. what is the outlook looking like for westpac? >> it is a great start to the week four westpac shareholders. we have seen aussie banks unwinding their provisions, outlook for westpac is a little

bit ecstasy, there are uncertainties as most of australia is emerging from strict lockdowns and there are question marks as to how long that takes for people to get back into the swing of things. over the next year, he is predicting significant increase in consumer spending and a seven point 4% expansion in the economy. he thinks the housing price market will remain strong but come back a little bit. they are expecting growth about a percent. kathleen: all of the things on the outlook, the consumer is very important, you mentioned buybacks. when you take that part of it, critics wonder why they do not put more money into something else by just -- besides just buying back share prices. are they responding to something that makes them think this is a good time to do it? >> they think this is eight

prudent time to do it because they did bulk -- balk all of those pandemic restrictions. they still have capital left even after the buyback. they announced a $.60 per share dividend, a positive surprise, but they are the biggest in terms of buybacks being announced by australia banks. it is something shareholders were definitely ending on for and expecting given how well the economy has recovered. haidi: our finance reporter in sydney. let's schedule a check of business flash headlines. there are reports and asset management nobody is sending a deal. it listed the electricity company to around $13.5 billion including debt. the offering is $2.60 a share.

i jet company as instructed deal with rolls-royce to buy engines and services. it will fit its weight with engines as it moves ahead with expansion plans. that is it for "daybreak: australia." "daybreak: asia" is next. ♪

haidi: a very good morning. kathleen: welcome to daybreak asia. g20 leaders fall short on climate change leaving negotiators to achieve a breakthrough. haidi: kush eta defies expectations of japan, retain