>> good morning. we are counting down to asia's major market open. shery: the top stories this hour, elon musk seals the deal to take twitter private, one of the biggest buyout agreement in history. paul: a turnaround, a busy week for big technology earnings.

covid concerns in china. shery: beijing expands coronavirus cases as looming fears of a lockdown of the capital. paul: the policy direction as the global inflation rate reaches asia. shery: u.s. futures at the open, we had the turnaround in the new york session. big technology earnings rallied the technology companies. we have alphabet, amazon, we even had chinese companies moving to end up higher. it was quite an exciting roller coaster ride of a session in new york. 10-year note -- 10 year yield holding. oil prices ended around $98 a barrel. a key question is what happens to the chinese economy, not to

mention the ongoing lockdown and the fed tightening not helping with a strong dollar. the key story seems to be with tesla and the buyout of twitter. one of the largest in history when it comes to lbo's. twitter gaining ground, when you take a look at the broader context of what was happening this year, tesla moving above 7%, look at what big technology earnings have been doing, they have not been performing that great. big car giant mike ford -- like ford. paul: trading after the long weekend, monday was a public holiday, stocks are off 1%. we are a couple hours away from the open in australia. futures pointed to a weaker open

of about a third of .1% -- open at about .3 percent. a couple of resources companies with quarterly production reports are out today as well. nikkei futures pointed to a flat future -- open, very close to the 130 level. no trading yet, we keep an eye on that as we keep going. that has not treated since friday. shery: now we are seeing the japanese yen strengthening, all of the safe haven currencies are strengthening and we saw the global bond rally, treasury rallying as well. china struggled to control covid-19, not helping the fed tightening stance, concerns about all of that hurting world growth. it was interesting to see the 10 year yield which had peaked, to

98 was the level, south of 276 at one point today before the 281 level. the two year yield is sensitive to policy. what drew support for the treasury is the weakness in equities globally. we take a lat what happened in china, not helping that the japanese yen was strong as well. paul: in terms of china, the covert outbreak worsening and fears that beijing could be next when it comes to testing. china has cut the bank's reserve ratio and they need to hold 8% in reserve, that is down from 9%. that will change the supply of other currencies on shore. offshore yuan trading 1517 at

the moment. shery: elon musk taking twitter private in a 44 billion dollar deal, one of the biggest buyouts of a company and unanimously approved by twitter's board. let us talk to emily chang, how surprising is this and what does it mean for twitter? emily: twitter's board decided to take a poison pill to prevent elon musk from completing a hostile takeover of the company and then over the weekend and they started negotiating in earnest and we woke up this morning to news that a deal could the eminent. jack dorsey, one of the founders of twitter has been influential in this deal, tweeting positively about the prospect of elon musk having a greater role in twitter. there are huge open questions about how he plans to run their

service, if he wants more free speech, what is free speech? we have been getting headlines from twitter all hands meeting with employees and the current ceo as well as the chair, they have said that there is going to be no layoffs at this time. there will be a hiring freeze. the company will continue to operate as normal until a deal closes and when the employee asked about the future of president trump's account, he has been banned, they say that is a question for elon musk. there are a lot of questions for elon musk. paul: here is another question, what is going to happen with the revenue? are we looking at a subscription model? does anyone have the slightest idea right now? emily: tweets from elon musk, he

has not expressed a lot of confidence in an ad supported model. he would potentially like to explore a subscription-based model but there is a question of how much engagement you can drive and how many people are willing to pay for twitter. also twitter is a private company, it does not have to have a balance sheet that pleases public markets. how much of a priority is making money at all to elon musk? that is a question we do not have an answer to. paul: the evolving twitter situation. global market volatility is spiking as this is weighing growth very -- fears in china and fed tightening. let us start with you, some of the big moves in the treasury, what are you watching for today?

>> we are watching for some reversals because that is a lot of what has been going on. we talk about volatility spiking, i imagine australia and new zealand will go down and there is a chance if china goes around, the chinese market bounces back, the bonds could be volatile. bonds and stocks go on being volatile because we have this policy divergence. very much, surprisingly, people not being prepared for what has gone on with covid in china even though this has been a slow burn turned into fast burn crisis. in particular the fact that china is not going to shift from covid zero, that exacerbates all of that. the most important thing to watch is currency volatility.

currency volatility is the one that is spiking back up to the levels that were last seen in march of 2020. stock volatility and bond volatility have been high before that. i would like to see some common currency markets because before i could be sure that there was any chance for real complicated forms and stocks. shery: especially with this chart on the bloomberg showing how they are having the worst day since march of 2020. a lot to do with the virus situation there. >> we are focusing on beijing right now, shanghai has been having an ongoing lockdown for a month now, on to the fifth week. no end in sight with 20,000 infections every day. the beijing residents feel what

has happened in shanghai, people were promised that the restrictions would be eased after the campaigns through the first week of april and the lockdowns have not abated. beijing people see this and understand what could happen. the virus caseload in beijing is low, 29 new local infections yesterday through 4:00 p.m.. what we are seeing is in the eastern part of the city, the most populous district was the first one to have nasa testing, three days this week, then tomorrow, then friday. authorities announced another 11 districts, 12 out of the 16 districts of beijing, a city of 22 million will be having mass testing as of today. they go tuesday, thursday, saturday, with mass testing. what followed mass testing was lockdowns. not every city, but many of

them. people are saying we better stock up on groceries, stock up on supplies, medicine, and lines have been around the block in many big neighborhoods. the economic epicenter is where all of the embassies are, many multinational companies are based there and that is what it is the epicenter of the tension and the infection. 16 of the 21 infections were in the area. slow burn, then fast burn, and in shanghai it is back to a slow burn but at a high temperature because we are not getting any relief at all. shery: not surprising we are seeing china's policy making moves on the schedule. you are seeing that already? >> china cutting the foreign

currency reserve ratio for banks. financial institutions required to hold 8% of the foreign exchange in reserves, down from 9%. it is aimed at increasing the amount of foreign currency available to banks. the white house says it is preparing a financing package for ukraine with more details to come. that is after officials visited kyiv. lloyd austin told reporters the goal is to see russia weekend and the country has lost a lot of military capability. the european union has set up a trade to boost cooperation, it is part of a broader plan to accelerate trade talks with india to help new delhi pivot away from russia. it accounts for six to $7 billion worth of trade -- 67 billion dollars worth of trade.

constitutional amendment gave executive power after the main opposition party had enough support for a no-confidence vote against the administration. sri lanka was downgraded after the government failed to make a payment on bonds. global news 24 hours a day, on-air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. paul: a big interview with the philippine central bank governor. we ask if he still plans to see rate hikes in the second half of the year. rock creek is cautioning against chinese equities in the near term. this is bloomberg. ♪

>> the chinese element of the story. >> whitening lockdowns across china. >> a big policy ever.

>> intensifying across the board. >> stocks running out of steam. >> that could be more downside. >> all of the cyclical dynamics we are seeing is unprecedented. >> that added to inflation. >> it is hard to make long calls. shery: some of our guests discussing global market risks. the macro headwinds are steep and physical hill to climb, with us now is a multi-asset class solutions officer at rock creek. you talk about macro headwinds, we always thought of the central bank posters, if there is a downside to the economy. are you more conscious because the central banks are the headwinds? >> it is not just the central

banks. we are facing a confluence of factors that the markets are having to digest. it is not just the pace of interest rates, it is supply chain, it is what does the lockdown in china mean for a supply chain that was just finally starting to make its way? the question is this notion of there are so many factors and you throw in geopolitical factors. how does that impact consumer spending, local growth? all of it is related and that is going to start to affect what we see in markets and adds to the volatility we are seeing today. shery: because of all of that, haven't we seen enough of a selloff? we are seeing some of the worst selloff since the beginning of the pandemic. went that make the markets pretty cheap -- wooden that make

the markets pretty cheap? >> there are pockets across the globe where we see a more attractive valuations. will the fundamentals be able to overtake the headwinds we are facing from the macro? we saw an interesting to snap the u.s. markets. s&p was down near the open, now we are setting to have more earnings trickle in. 80% left of the s&p 500 left to report yet. that continues to add to the uncertainty and volatility and things could get to steeper from here. paul: you identified this as a stock picker's market, what stocks do you pick in this environment? >> more sectors and stocks and what we think is we need to get into a marketplace where fundamentals start to get more attractive so that active

management can do its part to be able to overcome the macro headwinds. we are positioning our portfolio to be flexible and nimble and keep a lot of cash that we can start to invest more heavily when we see the market turn towards fundamentals. in terms of earnings guidance, and canned the cost, the input cost that every company is facing be offset by a continued strong consumer demand? that is where the attention needs to be focused on. paul: we saw yields pulled back a little bit today. where will it be? >> we are looking more towards the end of the year, a trajectory of three key factors to determine whether the fed and other central banks can bring inflation down with a soft landing which will impact the yield. we are watching demand, supply,

and they should be expectation and how that plays into whether the fed decided to increase the pace at which they raise interest rates. if this soft landing is not engineered perfectly, we could see recessionary territory towards the end of this year or middle or early next year. shery: it was good having you with us. china has put a floor under the currency after the yuan had a loss driven by the concern that the covid lockdowns may have caused chaos for the economy. we thought the weaker tuan would be beneficial but now the code they are acting. >> when they see a rapid move in their currency, something like

1% two days in a row is a big move. central banks could be stabilizing, a move like this starts to become dangerous. that is why they have gotten on the move to get this forward. shery: we cannot hear you at this point, we have an issue with the mike, we will be back with you. you can get a roundup of all of the stories you need to get the day going, terminal subscribers, go to dayb . get the assets that you care about. this is bloomberg. ♪

>> credit suisse is considering

the second management overhaul, struggling to turn around the bank after fears of scandals and profit warnings. credit suisse may replace of long-standing executives on the management board including the top lawyer, cfo, and the head of the asia-pacific region. a surge in emerging markets, revenue climbed amid volatility and the war in ukraine. they have cashed in russian and ukrainian credit default swaps. firms including cvc are considering bids for toshiba after the japanese conglomerate said it would open the doors to buyers. a potential deal, a buyout of toshiba which has a market

capitalization of almost $18 billion could be the biggest ever deal in japan. we are going to try to go back to kathleen and get an explanation of what is happening with the chinese yuan. policymakers have acted. >> two days in a row it was down by 2%. that is the kind of move that makes a central bank nervous. they cut the foreign exchange reserve racial -- ratio from 8% to 9% and here is what they said about the move. it is a slowing down the yuan's plunge. increasing bank's capabilities of foreign-exchange use. they want to put more liquidity, calm things down. it follows two hikes in 2021

that were done to limit the yuan 's rise. if you reduce the reserve ratio for banks to hold the domestic currency, they would not be quite so eager to hold the foreign currency. this should dampen the desire to hold dollars off door -- offshore. that is what they are trying to do here. it only partially reduces the two percentage point move. they have to do more, that is the message. if this is not enough to calm things down, cutting this ratio is showing that they are not comfortable with the state of the yuan's drop. this is classic central bank action. both goldman and wells fargo saying it reverses what they said in the past, that the yuan 's was market driven. on an emergency move, it could

prevented something that could have gotten worse. we will see what happens next. paul: up next, we are speaking with the central bank governor about this is xfinity rewards. our way of saying thanks, with rewards for the whole family! from epic trips... to the original jurassic park... on us. join over 3 million members and start enjoying rewards like these, and so much more in the xfinity app! and check out jurassic world: dominion, - [announcer] imagine. having fuller, thicker, more voluminous hair instantly. all it takes is just one session at hairclub. introducing xtrands. xtrands adds hundreds or even thousands of hair strands to your existing hair at the root. they're personalized to match your own natural hair color

and texture, so they'll blend right in for a natural, effortless look. call in the next five minutes and when you buy 500 strands, you get 500 strands free. call right now. (upbeat music) shery: focusing on emerging

markets in asia, rising energy and food prices are causing economic pain that is being made worse by portfolio outflows as it blocks back to the u.s. to chase rising real yields. it puts central banks in a tough spot. the pressure is on for them to be in lockstep with the fat and mitigate the impact on their local currencies -- fed and

mitigate the impact on their local currencies. let us bring in our policy editor who is with us and with a special guest. >> we have the head, the governor of the central bank of the philippines in our new york studio. it is a first. a very important day. i want to start because you were in washington last week for the meeting, they did raise the philippine forecast for the here. 6.5 26.3 -- to 6.3. you have to see traction in the economy before starting the normalization. are you seeing more of that? that kind of traction that would allow you to do that? you have a meeting in may, that

is a bit too early? >> bounceback by 5.7% last year. we expect the economy to grow at seven--- 7%-9%. then we go back to our normal henceforth. we see the improvements, manufacturing index is 52.4, the highest in three years. last year was 52.4%, globally, the investment went down. the investment went up last year. >> is that space in the march meeting nero for you to be able to say the economy is doing better and inflation is rising? we start normalization. >> we have the meeting, our next

meeting is on may 19, we look at the data. hopefully it will be a first-quarter growth of around 6-7%. on the basis of that, another cycle which is we have another meeting in june and that may be the time we consider the increase in policy rate. >> i want to follow up, the treasury secretary told me last week when i asked him about the risk of aggressive fed rate hikes, individually impacting economies. he says if the u.s. graces rates, the philippines will want to follow -- raises rates, the philippines will want to follow. >> what makes a big difference is the real interest in the u.s.

and our inflation rate is around 3%. yours is a .5% -- 8.5%. we cannot afford to wait -- we can afford to wait. there is no evidence of second round on the demand side. we will be in the nature of outpacing transport. increasing wages, we do not see that happening. also, another thing is the real estate. there is a significant increase in real estate in the u.s. and we do not see that in the philippines. paul: i wanted to ask about peso

weakness, how does that factor into your thinking and potential path to inflation as well? >> inflation, it has depreciated at the seat rate or it is at the middle of the depreciation of the other currencies in the region. we are not concerned about the depreciation. it is within our target range of 48-53 pesos. that is our assumption in our model. we have right now, we have reserves, close to $108 billion. 9.5 months worth of work and payment of services. three months worth of imports is enough. we have a steady source of

revenue from interdisciplinary meetings and business sources. it is around $60 billion every year coming in. >> in the context of a couple of things, the international fund boosted your inflation forecast for this year, not too far above your target. at the same time, it seems a big question for central banks is the ukraine war is accelerating the food and energy price increases so the headline inflation gets high at the same time, it hits your consumers and businesses hard. how are you sorting that out? is that a force that moves you faster to the rate hikes or slows you down? >> the adjustment in inflation is already incorporating the higher oil prices.

there are other food commodities , we also see that go back to 3.6 and that is our target range in 2023. that is 4.3 two 3.6. >> bringing it down to 3.6%, it does that incorporate the expectation there will be 2-3 rate hikes to bring it down? >> the assumption that prices will normalize by next year. >> another thing i wanted to ask about was the debt. the idea that the economy has to grow at 5% or 6% for the next five years to help pair down the debt -- pare down the debt.

do you factor that in to your policy decisions? do you have to be a bit more careful with the rate hikes? >> the situation is before the pandemic, our debt to gdp ratio was around 39.6%. it went up to 60.5% after the pandemic. that is still manageable. globally, the debt to gdp ratio is 160 plus percent. as long as the economy grows around 6% or 7% we will be ok. that is the denominator. as long as it is growing much faster, that is fine. >> you say lowering the rrr rate is on the table this year? under what conditions, on the

opposite direction of raising the key rate? >> it is not related to the crisis at all. i made that promise when i assumed governorship, i plan to reduce the requirement. the debt limit was 18% to single digits. that is still on the table. because we are doing that, you are taking so much money from the banking sector, that is over regulating the banking sector. i allow them to lend out the money and getting the money from them to lend out to the public. >> in terms of capital like fed raising rates aggressively, do you have any concerns that is another reason why you may have to raise your rates as much as you said, even more aggressively? >> in the past i have seen many crises in my lifetime.

every time we have a crisis we run out of dollars to pay our foreign-exchange debt. that is no longer the case. a hefty reserve and our debt is small. our foreign debt to gdp ratio is only 37.6%. to me, that is not a scary concept. if i have money and their is another fund, that is a backup and that is significant also. if i have money, why should i bring it out of the country when the possibilities are nice in the country? >> are bright prospects for the philippines this year -- there are bright prospects for the philippines this year. thank you. paul: the u.s. senate implement -- diplomat back to ukraine as

they carry out the highest level visit since the start of the war. this is bloomberg.

>> china is expanding the covid-19 testing to most of beijing, raising fears of a

lockdown. officials say there will be tests in 11 of the 16 districts. they shut down fears are sparking panic buying of food and other staples. elon musk has clinched a deal to take twitter private in one of the biggest buyouts in history. the deal is approved by the company's board and is expected to be completed later this year. twitter shares are up. donald trump has been held in contempt of court for failing to turn over records related to a new york investigation into asset valuations. the former president has been ordered to pay until he can implies -- complies. hong kong for correspondence club is suspending the human rights press awards because of concerns about the security law. they were due to be announced

last week but they say they are worried about unintentionally breaking the law. the sec continues to promote freedom in hong kong but will change the approach. global news 24 hours a day, on-air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. shery: washington has committed an additional amount of military financing and grading a longer-term financing package. russia is facing a major completion of military hardware and capabilities. >> russia is already failed and ukraine has already succeeded because the aim that president putin bought to this was to fully subsumed ukraine. that has not happened and will not happen. shery: we bring in our political

news director. what do we know about the latest round of financing? >> antony blinken and the defense secretary went to ukraine, they had been invited to go by the ukraine president, that the u.s. should send officials what they should not come handy -- empty-handed. they came with money, more than 200 million -- 300 million for countries who have been helping ukraine in terms of military capabilities. congress is set to receive a packet from the white house, we do not know what the request will be, we expect it will be this week, now that congress is back from spring break. it is expected to be in the millions of dollars and to receive bipartisan support. nothing is ever easy in congress and they have to decide on covid

funding for those to get caught up together. it is expected that there will be a multimillion dollar package of aid coming soon from the u.s.. another package for ukraine. paul: what is the u.s. is saying about the state of the russian and ukraine militaries? >> we heard that they were saying that in terms of pressure, the u.s. believes that russia is drawing down the capability. it is becoming weaker and it has used up a lot of its military arsenal in three months of this war. they were pretty optimistic both the secretary of state and defense about ukraine being able to withstand russian forces but it depends on how much support they continue to get from nato and the u.s. shery: let us talk about the

g20, u.s. and allies are lobbying to get ukraine into conversations? >> the u.s. and allies had said indonesia would be holding the g20 that they not invite or disinvited vladimir putin after the invasion of ukraine. they said that they do not want -- they wanted to be neutral about this. the countries are pushing for ukraine to be invited, at least to some of the meetings, if you will not remove putin, invite the ukrainian president. paul: let us take a look at how trading in the bond space in new zealand, a long weekend for the holiday on monday and we are seeing australian bonds rallying after the break. yields dropping for the 10 year come up by about seven basis

points. similar story over in new zealand, the yields are 354.8. u.s. 10 year peeking last week, that is off since then. a number of pressures at work, the fed looking to tighten a 50 basis point move at the next meeting and we have been discussing the lockdowns in china and the supply-side inflation that is causing. australia and new zealand yields are following the path of their international fears of shery: it is time for morning calls, the price of protection may be the only thing not falling in markets which complicate the picture for traders rushing to hedge risk. u.s. stocks are hovering near the highest in two years wildly curve has actually inverted despite the extensive background

, hedging is the only strategy that is working right now when earnings fail to boost sentiment. he says the stock market is likely to rally in the coming days. we are seeing losses from the previous week, buyers could include companies coming back from a blackout and shifting funds and fixed income. risks are skewed towards a new equity rally, low positioning and other factors, we have more head on daybreak, this is bloomberg -- ahead on daybreak, this is bloomberg. ♪

paul: we are getting news from the australian oil and gas producer coming with first quarter production numbers, first-quarter sales revenue coming in at $2.36 billion. we will have woodside opening in an hour and 10 minutes. one of the stock to keep an ion if returned from a three day weekend -- eye on from a three day weekend. a quick check of the latest headlines. nissan has reached a settlement

with investors who had accused the carmaker of misleading them on pay. they accused them of making fake compensations through deferred payments. this involves adrs between may 18 and december 2016. more flights from london to hong kong as the airline rebounds from covid-19. as many as three daily services will be available come up from as u.s. two per month after hong kong opens to nonresidents in may. activision missed estimates due to an underwhelming performance in the call of duty game. the company which is being purchased by microsoft saw adjusted revenue for 28% in the first quarter to $1.5 billion adjusted earnings-per-share with

$.38, almost half of what analysts were expecting. have a look at the oil price, $100 a barrel for west texas, trading at 98 $66 -- $98.66 per barrel. rebounding ever so slightly, gold dipping below -- sliding off .5%. the spot index is weaker as well. shery: you have the two forces pulling in different directions. the supply chain disruptions and the chinese demand will be strong given the covid zero policy and we are starting to see the supply chain disruptions. something that we were focusing

on, the beginning of the pandemic two years ago continuing to be the story again. china accounting 4% of global trade and covert restrictions, really not helping the trade in global goods. paul: it used to take about 50 something days for a product to reach the u.s. after leaving the factory in asia, that has been up to an average of 111 days. double what it was in 20 before the pandemic. we are not quite where we were before the supply chain crunch but the big technology story suggesting that a return to the bed is also showing friend shoring which is i subtle dig at china and -- a subtle dig at china and russia. shery: we have seen china trying

to keep workers in factories with that closed loop system. the point remains that these covid zero restrictions and policies are not helping the global trade outlook. when it came to trading in the new york session, we saw a bit of a pickup when it came to the chinese avr's. it was quite a turnaround for the entire market because we have these chinese stocks falling as much as four point 1%, they are seeing three weeks of losses. we saw a bounceback for baidu, we ended up gaining .7 percent. we saw the entire market in the u.s. with the late day turnaround. look at u.s. futures at the moment, unchanged.

this is after we saw the s&p 500 gained ground, a lot of buying and ended near a session high. this is bloomberg. ♪

so many people are overweight now, and asking themselves, "why can't i lose weight?" for most, the reason is insulin resistance, and they don't even know they have it. conventional starvation diets don't address insulin resistance. that's why they don't work. now there's release from golo. it naturally helps reverse insulin resistance, stops sugar cravings, and releases stubborn fat all while controlling stress and emotional eating. at last, a diet pill that actually works. go to golo.com to get yours. paul: good morning, we are

counting down to the major market open. shery: welcome to daybreak asia, our top stories this hour. elon musk taking twitter private, one of the biggest leveraged buyout in history. testing expanding to most of beijing.