haidi: a very good morning. we are counting down to asia's major market open. shery: welcome to daybreak asia. our top stories, asian stocks set for a steady start following a late surge in u.s. tech stocks. treasury yields jump on inflation concerns. samsung earnings are due this hour with a focus on demand for memory chips and it's a galaxy smartphones. plus, facebook adds more users

than expected in the first quarter, bucking concerns the network has peaked. haidi: let's look at how we are setting up to the start of trading. looking like a slightly better day. futures broadly higher. sydney futures seeing indicated upside about .7% when we get to the start of cash trading. lots of action when it comes to the reversal on the short end of the bond market particularly as we get really these rate expectations being piled on in the wake of superhot inflation reading we had yesterday. looking like a rate hike fully priced in before the election on may 21 at this point. kiwi stocks up by about .4%. we had that extension of the trade deficit with the import export numbers out a little earlier in the past hour. chicago and nikkei features looking pretty steady as we get into boj decision day and the yen has been holding steady as we wait to see any kind of hint

as to a reduction in stimulus or any change in policy settings. . that is not expected from the bank of japan, but certainly comments when it comes to the currency will be keenly watched, which is sitting at about 128 to the dollar. we have had quite a bit of dollar strength continuing. the dollar index topping the march 2020 peak. we had over 90 bloomberg dollar index jumping for a fifth day. getting a bit of support by those month end flows. the policy is trading a little softer this morning and dollar china also in view. let's get expectations of more stealth easing if you will buy the pboc. also watching the korean won as it trades at the moment. we're getting those samsung final earnings and that will weigh pretty heavily when it comes to trading in the kospi. the won seeing a significant amount of weakness. shery: not surprised we are seeing dollar strength.

the 10 year yield topping 280 again. a course you have the dollar index and the euro weakness and that exacerbates the move higher. also weighing on the commodity space. wti in the asian session fall below the $102 a barrel level. we are watching the after hours future market right now. we are seeing those significant gains on u.s. futures. we usually don't see this sort of movement in the asia training session at this hour, but we are seeing s&p futures up .7%. nasdaq 100 futures getting more than 1%, given that in the new york session we had higher treasury yields weighing on big tech, but perhaps not enough given the after-hours session has been pretty strong. meta-is surging, double-digit gains. facebook has almost 2 billion daily users. oof. over 19% gains at the moment. we are seeing paypal also getting about 4%.

this, given their revenue beat estimates. qualcomm is also higher because they gave out a strong sales forecast. haidi: let's get some more when it comes to that after-hours surge in meta and qualcomm. su keenan joins us with more context. su: last quarter we saw that plunge in the stock is there was concern that meta-was losing momentum and losing the popularity context with younger folks to tiktok. so the stock is up some 19% on the report there is close to 2 billion daily active users, beating expectations. that follows on the first time ever decline in users in the december quarter. revenue jumped 6.6%. the company said it would have been more were not for ukraine. it seems investors are really focusing on the good news, as is ceo mark zuckerberg.

let's listen. >> i think that the cycle here between investment and meaningful enough revenue growth to be near or very profitable, it is going to be long. i think it will be longer for reality labs than for a lot of the traditional software that we have built. su: so there is a view among investors that the company has stopped the bleeding, at least for now. there were a lot of questions on the conference call that show concern about how does meta with its facebook and instagram platforms fend off the popularity of tiktok. they do have a product called wheels, where they have these little video presentations. there are still trying to perfect it and figure out how to monetize it. not a lot of answers there, but they appear to be reigning in some cost and expense outlook. last quarter there was concern they were throwing everything and the kitchen sink at zetterberg -- at the metaverse. shery: we just saw qualcomm

continuing to gain ground in the after-hours. su: there was a lot of concern after the pandemic-field surge in chip demand it would drop off. not so. a strong sales course -- a strong sales forecast. handset sales drove the record results, define productions. increasing use of chips in the industrial machine area and the automotive sector. qualco -- qualcomm pretty think it's handset production will grow more than 50% the current quarter. they see revenue coming up to $11.3 billion. we saw profit and revenue beat in the current quarter. also see recovery from the covid impact in china already, and say supply has improved and they are able to meet more demand. they are saying they are getting market share on the high-end of the smartphone market. they are seeing softness in the lower tier. and while analysts pointed to

slower demand for android phones in china, which is their largest market, as possibly being a threat to growth, sales of chips for those smartphones came in better than expected. so that is another worry eliminated there. shery: su keenan with the latest. those earnings results here in the u.s., we will get the outlook with two huge names. the qualcomm cdl will join bloomberg technology thursday new york time. also, the intel ceo also joins friday in the u.s. ahead of his trip to japan and taiwan. but of course here in the asian shows we are watching what happens with samsung, because another major chip earning this hour. look at this, because the semiconductor giant's market value has dropped low 20% of the benchmark kospi for the first time since june 2019. when we talk about what is happening with the kospi, it is

usually what is happening with samsung electronics even their heavy weighting. this year they lost about $75 billion in value and their outlook has come under scrutiny. we will see if a weaker won has helped their exports at all. the losses have accelerated for the south korean won. we are just hearing from the finance minister saying that korea will take measures to stabilize fx as needed. haidi: of course other big event, the bank of japan expected to keep all of its meeting today. policymakers are pushing back against speculation the weaker currency will force its hand. let's bring in garfield reynolds. about 10% of those surveyed expected a start pulling back when it comes to stimulus for for guidance. do you expect that? garfield: i don't. the boj kind of stalled by

coming out with five consecutive unlimited bond buying operations to keep the 10 year yield under 0.25%. there was plenty of messaging that they would do that. never mind what was going on with the yen. and to some extent they were reinforced in that stance by the fact that the yen settled down and in fact, other currencies ended up dropping far more swiftly than the yen did over the past week. we had the collapse in the yuan at the start of this week. then we had the euro dropping towards levels last seen in 2017. if it goes much further it could bust through those levels and be at the weakest it has been since early in the to thousands. -- in the 2000's. the yen is not just a japan story, it is more about the broad u.s. dollar strength. i think that is going to give

the be og -- the boj more than enough cover to stick to their program. inflation in japan will be higher than it has been for some time. but that is still nowhere near even the 2% a year target that corrode and has board are looking to achieve. haidi: australia gaining ground after we saw core cpi numbers. what are we expecting from the rba next week? garfield: it is hard to see how the rba does not raise rates next week. if it does not it is going to have to do a lot of talking about what it plans to do when it does raise rates. it is impossible for it to stick to the idea that interest rate increases are any distance away. it might will be that they effectively lay out and say look, when we move the first thing we will do is not

necessarily go to .25 from .1 but go to .5. the market is very much indicating that it expects rapid rate hikes once the rba gets going. the analyst unity seems to be split between those who think they will be 15 basis points were short next week. others are saying look, we are in the middle of an election campaign and a 15 basis point rate hike does not do that much for you. so the rba might be more likely to wait until june when will have a fuller suite of data, and then moved from .1 directly to .5. shery: garfield reynolds there with the latest on where the rba and the boj could be headed. let's get to vonnie quinn with the first word headlines. vonnie: archegos capital has been arrested by federal agents a year after the collapse of his family office. prosecutors say he was behind a

vast criminal scheme to mislead banks and manipulate markets. he and his former cfo have both been charged with fraud. he pleaded not guilty and will be released on a bond of $100 million. the european commission president is warning companies not to give into russia's demands to pay for gas in rubles. european firms have been scrambled to respond after russia cut off gas to poland and bulgaria. at least four european gas buyers have given into moscow's ultimatum. >> our guidance here is very clear. to pay in rubles, if this is not proceed in the contract, to pay in bulls is a breach of our sanctions. companies with such contracts should not given to russian demands. vonnie: china's government has pledged to stabilize employment. at a meeting, it was agreed more forceful policy measures should be taken to boost jobs. china's surveyed jobless

rate is at its highest since may of 2020. 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'm vonnie quinn. this is bloomberg. shery: still ahead, samsung earnings are due this hour. we break the results with clsa, which sees the tech giant upsetting -- plus, blackrock tells us why a flexible multi-asset strategy is recommended amid higher and more volatile inflation. this is bloomberg. ♪ bloomberg. ♪

>> this is very clear. in the short-term as i said before, 2022 is going to be a transition year. shery: the credit suisse ceo speaking to bloomberg after the bank shook up leadership. some of credit suisse's struggles stem from the closure of archegos capital which cost the lender $5.5 billion. today the archegos founder was arrested year after the collapse. prosecutors say he was behind a vast criminal scheme to mislead banks and manipulate markets. let's bring in bloomberg executive editor tina davis for more. what is he being accused of? tina: he and his cfo are charged with 11 counts including market manipulation, attempted market manipulation, racketeering, securities fraud. it is a lot of charges and adds

up to potentially a great deal of prison time if he is convicted. haidi: the details of what we know from this case is much more interesting than what we knew previously. what is the government alleging here? tina: according to the government, roundabout march 2020 when the pandemic began, bill started trading from a manhattan apartment rather than his normal office, and he seemed to go off on his own. he stopped listening to his investment advisors, he stopped reading commendations, and he became intensely involved in day-to-day trading at archegos. this worked spectacularly well for a short time period. his personal fortune went to $1 billionto $35 billion. he bought up to 5% of shares in a publicly traded entity with cash, then engaged in what are called total return swaps, which gave him exposure to the shares without having to own them, because he didn't want to know they market to know how big a position he had. the problem with this scenario

is he only continued to make money if the shares went up. in one case at one point he had more than 50% of the float of viacomcbs. and when those shares went down, he was exposed to margin calls, and that led to the start of the vicious cycle that brought down archegos. haidi: so what happens now? what is the timeframe of the proceedings? tina: he and his codefendant were in a courtroom in the lower manhattan today. both have pleaded not guilty. both of their lawyers say they are going to fight the case. they were released on bail, so in the case of bill hwang, he put up $100 million so he did not have to stay in jail. we know both men are due back in court on may 19. haidi: tina davis there with the details. you can get a roundup of that story and the other stories you need to know to get your day going in today's edition of daybreak. terminal subscribers can go to

dayb and it is also available on mobile on the bloomberg anywhere app. you can customize settings so you just get the news that matters to you. this is bloomberg. ♪ s bloomberg. ♪

haidi: some of our early guests sharing their views on this earnings season. our next guest is higher and more volatile inflation is a headwind for stock valuations. with us is ross coaster wretch -- great to have you with us and we appreciate your time. there is so much uncertainty and so much potential for volatility. will it be the policy outlook or inflation or what is going on in china, geopolitics. so what is your approach at the moment? russ: good morning. there are a number of headwinds, and this has been a very different year than 2021. but i think first and foremost

the issues that investors globally are wrestling with is a very aggressive and rapid tightening of financial conditions. we have central banks rapidly raising rates in response to inflation. this has created a huge headwind for valuations, for asset classes, for sovereign bonds. we've been lowering risk. we're running a lower risk for folio than we were six or eight months ago. we brought down equity exposure. we are very underweight government bonds. and we have been very careful that our style risk. this is in response to what is in honestly -- to what is honestly a less hospitable environment than we enjoyed late last year. shery: what is your position in terms of the possibility of a recession anytime soon, and how does that set you up for more cyclical exposure at this point? russ: it is a great question.

here, i would be more optimistic. we don't think we're are looking at imminent recession. certainly not a 2022 recession, particularly not in the u.s. and clearly we have a number of factors that are likely to slow growth, from higher energy, higher food prices, and of course higher interest rates. that said, specifically in the united states, you have a very strong household sector with a balance sheet that is delivered, strong neighbor -- on the corporate side we are still seeing significant demand and capital spending. so i think you need to be careful about your cyclical exposure, but i don't think you expanded -- you abandon it. natural resources, select industrials. i think we are going to continue to be in an environment where companies that benefit from solid growth are going to continue to do well. haidi: you don't expect

consumption to take a hit given rising prices? russ: we think consumption will slow, particularly in more rate sensitive parts of the market. we are already seeing a slowdown in housing, in housing materials, in anything related to the stay-at-home trade that did so well in 2020, 2021. that said, we do think the consumer is in good shape. it's happened in real time, a shift in consumption. people binge on many goods during the pandemic anti-lockdown. electronic -- pandemic and the lockdown. electronics, home furnishing, etc. now they are shifting that spending to travel, restaurants, and we think that trend will continue through the year. it is not that consumption collapses, but it does evolve. haidi: energy, metals, how do you approach getting exposure to that? and i guess in an also related

way, how are you approaching the green trade given the pressure of high prices and limited supply? russ: that is a great question. the short answer is you want exposure to these themes, everything you just mentioned. energy, metals, historically have been some of the most effective industry tilts when inflation is high and accelerated. and that dynamic is very much held so far year-to-date. energy of course the best sector. we've also been investing in infrastructure. again, energy security will be a very important theme in much of the world. the companies that create those pipelines are definitely part of what you want to have in your portfolio. shery: russ koesterich, it was really great having you on. we are counting down to the start of trade in tokyo and seoul. some of the stories we are watching today, samsung's first-quarter earnings are due

with their memory chip business in focus. the president-elect's transition team will announce plans to compensate small merchants for losses caused by covid social distancing resurgence. and industry minister will be releasing its monthly data for department and discount store sales. in japan, more details into a probe into -- softbank and its subsidiary are set to be closing in on an agreement to regain control of the chipmaker's china operations and oust its rogue ceo. and they will buy back as much as $1.6 billion worth of its own shares. haidi: we are going to get more on the boj ahead. could be one of the most exciting meetings in recent memory. the yield curve can stroll --

control strategy something to watch. no expect -- watching for forward guidance in terms of any reference to a pullback in stimulus. and of course watching the yen. this is bloomberg. ♪ ♪ 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, in theaters june 10th.

>> hours away from one of the most closely watched back japan decision in years. rapid weakening to a two decade low against the u.s. dollar is fielding market speculation about a possible adjustment to policy or messaging. the yen is currently at its weakest level on its tenure since 2013. our bloomberg economics and policy editor kathleen hays is here with more details. the consensus is still for no change, but because of the yen's collapse, we are doubting

ourselves. kathleen: you can't help but think governor kuroda, you've got the yen near that 20 year low, and potentially going even lower, can't you do something? so far, even with the strong expectation on these questions, look at what we see here. not yet is the word. eventually they may move, but most people are saying probably not until next year. partly that's because that's when governor kuroda ends his second five-year term. that would be an appropriate time for the po date -- boj to change their policy to less stimulus. 89% of people in our latest bloomberg survey, the economist say that there'll be no change at all. you will keep the key rate at the negative 0.1. they will keep yield curve control in place with add 0.25 band at the top side of the range. and here is the yen underscoring the big strength of the dollar weakness in the yen. in the main driver is policy

diversion. there boj is keeping its key rate negative. the fed is at 0.25. they are expected to get to 2.5% this year. this is a big reason why the yen keeps weakening. that's a big reason why currency traders are going to watch the policy statement that comes out, listen to government kuroda. -- governor kuroda. changes could be on the yen. this offense that maybe it's more of a concern. this is the big question now, but, so far, even the slightest change could mean a lot here. >> why does the boj seem to be digging its heels on the policy change, even as we see inflation rising, is it because they see through the elements of the inflationary pressure? kathleen: absolutely, governor kuroda has been saying inflation is rising, but commodity prices are pushing it, not demand like

you see in the united states, that's not necessarily going alas, even though inflation is expected to get to 2% -- 2% this year. there's also the sense that if we keep our policies stimulative, that will weaken the yen and allow inflation arise, but at the same time, if we tie in, then we could actually get an economy that is just barely recovering from covid-19 and a lot more, as recently as this past friday this is what he said speaking at columbia university, that the boj should persistently pursue the aggressive stimulus towards achieving price stability of 2% in a stable manner. in other words, go up and come back down, he said there still a lot of ways to go on that. and the prime minister, just two days ago said he hopes that the boj will continue its policies, the efforts to achieve that 2% inflation goal. so, the idea is that 10% do see that maybe there is a shift in

forward guidance. not changing anything, just giving a sense that they could see the weakness in the end, see inflation moving higher, and depending on how things go, maybe they will make a move. our boj team in tokyo saying, watch for anything like dropping the policy linked to covid. in other words linking what they might do next because we know they have taken away a lot of the restrictions, they are opening up the economy. and with that, if they would then maybe open the door a little bit to looking at removing some stimulus, of course, i think a lot of people figured a logical one would be to widen the yield curve control band a little bit. that would put the yields a little bit higher and give the yen a little bit more support. not expecting in this meeting. if we get anything like that we will see movement in the market. don't you? haidi: i just like the attitude

of the 10%. our global economic and policy editor kathleen hays, head of the bank of japan. more insight on what to expect from the decision. the head of japan economics, they will join us in the next hour with their thoughts. let's get you to su keenan with the first word headlines. su: norway is topped when it comes to normalizing live alongside the coronavirus while hong kong and mainland china are among the worst. that's according to the bloomberg covid resilience ranking for april, that's followed by ireland and the new a -- in the uae from places the pandemic is being handled best. the uk's down two spots to number 12, both due to the number of fatalities. to india now where the prime minister has called on urgently wrapping up covid-19 vaccines for children. this as daily infections hit a six week high. shots were recently approved for children over the age of five as

public concerns grows about the outbreak of a new variant. and there hit hard by the delta wave which overwhelmed hospitals and lead to tens of thousands of deaths. the biden administration is drawing on emergency funding powers for nations that die at risk of hunger because of russia's war in ukraine. the funds will be used to assist ethiopia, kenya and yemen in the first time since 2014 that washington has used the measure and as part of the efforts to contribute $670 million in total. u.s. legislation aimed at increasing competition with china could face more ways. legislation would rise $50 billion with the domestic chip industry and has received broad support from lawmakers. sources say that negotiations have a separate bill from the house and senate that are yet to

restart and could extend beyond the midterm elections. global news, 24 hours a day, on air and on bloomberg quicktake, powered by 2700 journalists and analysts in more than 120 countries. haidi: policy support is spent pledge from beijing is china's covid outbreak in block downs spread. let's bring in our chief north asia correspondent stephen in hong kong. what are they pledging? stephen: it's not quite the kitchen sink yet, but policymakers are obviously concerned by the country not being able to meet their growth target of 5.5%. most economist that we have spoken to are rushing down their expectations for growth because of these lockdowns, these twin lockdowns, if you want to call in that. twin outbreaks. beijing is not necessarily in lockdown, yet, but it's the most biggest and popular's district and they fear could be a lockdown. essentially, he is the chair of the state council, but essentially china's cabinet, they are pledging to stabilize

employment, keep in mind in march, the unemployment rate fell to 5.8%, it's worsens may of 2020 at the beginning of the pandemic. so we have seen a number of different measures coming from policymakers from the pboc saying it will step up early this week. monetary support for the real economy and provide ample liquidity to the real economy. xi jinping called for an all-out effort to increase infrastructure spending, now the state council is calling for jobs creation. is calling for policy, should be taken to boost jobs, and that would be a key support for keeping growth within what he calls a proper range. state council saying subsidies would be provided to industries. as well as encouraging flexible work environment and delay some social payments. as i said, not quite the kitchen sink quite yet, but policymakers in beijing trying to stem the economic slide. >> the latest on the outbreaks

in shanghai and beijing. stephen: it looks like it stabilize. the outbreaks in shanghai have indications that some districts do not have current outbreaks, relaxation of that lockdown could happen. haven't necessarily seen it yet. but again, beijing has its number of infection still below 50. shanghai had a drop in number of new daily infections for a fourth consecutive day. in this city up in the northeast, they will start gradually lifting covid control measures from today, but it's not the end of this because the city that creates most of the world's knickknacks, christmas ornaments, maggot hats, you name it, they are in lockdown. >> stephen engle with the latest. first quarter consolidated net coming in at 11.1

3,000,000,000,001. the estimate was around higher than analysts expected. operating profit higher at 14.12 trillion one. at 77.8 trillion one. it was around 70 tree -- 73 trillion won. we continue to see the robust demand for models. right now samsung first quarter net at 11.1 3 trillion won. chip business operating profit coming in at a .4 5 trillion won . this is we continue to see samsung stocks lagging the broader market. fourth-quarter display business

operating profit coming in at 1.0 9 trillion won. let's get to our analyst to our joining us, korea technology analysts. as we continue to see the latest lines fourth-quarter mobile networks business operating profit, 3.8 2 trillion won. first of all, give us your perspective of the latest results. >> good morning and thank you for having me on your program. samsung already announces preliminary guidance on april 7, so there wasn't much of a surprise here. we understand that the strong results are driven by the semiconductor business, and also the smartphone profit was quite solid. as we have seen, overall pricing has turned out to be somewhat

better than the expectation over a month ago. also, samsung smartphone display business has done quite well. we think that memory price declines are moderating, and even though the china lockdowns remain, on the supply side, memory equipment we are seeing delayed from the memory equipment, which might result in a tight supply a more favorable environment for supplies and the second half. shery: they are pointing to the dollar strength against the korean won helping earnings as well. this as we get more numbers with first-quarter mobile network sales at 32.3 7 trillion won. tell us a little bit about some of the gains that came from a potentially weaker south korean won, helping their experts --

helping their experts. how much of a boost was this for samsung, and how will things look in this quarter because losses have accelerated? >> 1% depreciation positively affect samsung's earnings by 1% or so. we will get more details about what was the total effects impact on the company's earnings call, but a weaker one, definitely, is positive for it semiconductor and display businesses. it's not so positive that sector businesses and smartphones and consumer electronics. but samsung is a beneficiary of a weaker korean won. and i think current weakness in korean won should offset the earnings concerns about demand. haidi: there's a lot of fretting

about the foundry business. do you think these numbers are enough to offset that? it feels like we are in an environment where, chip investors are finding it hard to be convinced to the upside. >> you are right, but samsung's problems are more related to low yields on five nanometer and four nanometer process. in fact, the three nanometer process yields to start mass production of three nanometer process. in the first half of this year, i'm not sure, given what we're hearing about the yields. the yield to remain still quite low, so i'm not sure if the company will be able to start production of the chips. so we have seen key foundry companies back to tsmc recently,

and until samsung improves its yields on this advanced notes, the investors want to see some evidence of that before becoming more convinced. the samsung's problems go beyond what we are seeing. beyond just the demand concerns. haidi: when it comes to that supply and demand dynamic, is it leaning either side, because so much of the data shows that it is both elements, and to that end, it seems like chipmakers should have a bit of foreseeable demand in the future. >> as for the memories concerned, i think that the lockdowns and china have significantly raised near-term by tech demand and production, so there might be some mismatch between went memory suppliers

and. have with lockdowns and production, so their production continues, but the pc makers, smartphone makers, where it struggling in keeping the factories on the production, we could see some mismatch in the near term. so this might affect the bargaining power in the near term. but eventually, as lockdowns are lifted and production returns to normal, i think the demand supply balance will be in a memory supplies favor. as i said earlier, we are raising procurement of production equipment, which might impact tech migration and impact in 2022 and beyond. so we are positive on the memory sector outlook. shery: why is it not translating

to more strength in the stock? >> right, i think there are just too many -- right now. we don't know when the lockdowns will be lifted, the global macro and political opportunities are there, as well as the foundry business. all of these have impacted investor confidence in samsung stock and have been big sellers. they have sold about 10,000,000,000,001 -- 10 trillion won to date. they have come down to multiyear lows. we think once investors gain confidence about sector memory pricing and demand, which we expect in the second half, and also the foundry related yield issues getting resolved, we can expect stock to see a rebound in

terms of valuation and its trading even below 1.3 times below book, which is very attractive, and we would expect a rebound once sees go away. haidi: career tech analysts at clsa securities. we are getting more details from samsung saying the smartphone market has declined in the second quarter, also seeing a decline in displays earnings versus the first quarter as well as some of the shortage in the foundry supply-side to continue to the second half as well. but only to succeed the market growth of the foundry business to conclude the yield we were just talking about, which has been such a concern for investors. he could turn to bloomberg for more on those results. you can get comments and analysis from bloomberg's expert editors giving their reactions right now. plenty more ahead. this is bloomberg. ♪

haidi: breaking data when it comes to japan's industrial production. the number coming in, the preliminary number coming in at 0.3%, weaker than expectations of half of the lowering from the previous of 2%. the contraction of 1.7% with

expectations and falling into contractions with a gain of half a percent. retail sales fell. that was a beat at 0.9% better than expectations at 0.3%, and really bouncing back from that contraction of 0.8% month on month. that number coming at 2% again, better than expectations of 1% there. that retail sales numbers a little bit surprising, given the expectation that the weather factors and inflationary pressures could see it decline, but particularly when it comes to other aspects of retail sales, but that industrial production, we did see supply chain disruptions being caused by the earthquakes and some of the effects of the russia-ukraine war as well as constraining production. shery: china, a big part of it, we see shanghai reporting 10,600 62 local cases. this would be the fifth consecutive day that cases have fallen, also reporting 47 covid

deaths for wednesday. plenty more to come. this is bloomberg. ♪ ♪

shery: all eyes on samsung as we head to the korean open. this after the consolidated net beat analyst at 11.1 3 trillion won. we will see if that has bearing

on the market, because we have continued to see market value dropping. the low 20% of the benchmark kospi for the first time since june 2019. talking about the market cap for the slump dumping in the double digits, outpacing the sly on the kospi. that's one of the stocks that we have been watching today at the market opens in korea. we will also be watching in japan, semiconductor manufacturer set to spend up to $1.5 billion on a share buyback. toyota also topping its annual field goal with the second-highest total ever. softbank, a subsidiary closing in on her agreement to regain control of the chipmakers operations and announced its ceo. haidi: let's look at the fx data play. dollar strength remaining the key narrative, and that's really having that impact across the aggressive asian effects. we did see the dollar indexed

topping the march 2020. bloomberg market seeing again of a few sessions. we are seeing a hold on to the gains are we see the bloomberg index. aussie dollar looking pretty flat as investors are really scrambling to pass expectations with that hike from the rpa just to come before the election. we are now pricing in that hike to be fully priced and as well as further expectations for half of the supersized move. dollar china is in view as we watch for more signs of easing from the government there. of course, dollar-yen, 128, pretty steady but that depends on if we get in overture from the bank of japan's lsd meeting today. coming up in the next hour we hear from the bank of japan economics ahead of the bank of japan decision. they are expecting a one off in october. we are told that while fixed income markets are putting the increase risk of recession, it

contraction can still be avoided. we do have the markets open in sydney in tokyo next as we count down to the bank of japan. this is bloomberg. ♪

shery: welcome to "daybreak asia" from bloomberg's headquarters in new york. haidi: asia's major markets have just open for trade. our top stories is our, asian stocks are set for his studies start. the end and jgb moves in focus as the markets away for the boj decision. sales of memory chips and premium smartphones of setting

slowing demand for gadgets. plus, banks -- -- slashing their forecast on the chinese u.n.. they are pricing and worsening outcomes for the covid here economy. shery: we are seeing upside for the nikkei and the topics right now. the support of the japanese yen continues to hold near their 20 year low against the u.s. dollar. we did get the industrial production numbers for japan missing expectations, but retail sales beat expectations. all of that data ahead of the rate decision. of course, this is a 10-year-year-old holdup of .2 percent, though they do anything to stem the collapse of the japanese yen consensus, not really, but we will watch what they do in terms of the yield targeting mechanism, given the pressure that we continue to see in the japanese currency. take a look at the kospi and samsung coming online after first quarter net consolidated net beat estimates. we are talking about gains of .3%.

now, they actually pointed to the weakness of the korean won in helping the earnings. samsung is a stock that has underperformed the broader benchmark. we are talking about losses of double digits, 15% or so when the kospi hasn't lost that much ground this year. this is the korean won continues to weaken. the 12 65 level, it already saw the worst day in 10 months. we are a two-year low against the u.s. dollar. samsung has already pointed tomorrow headwinds in the second half, including parts shortages, not to mention, covid as well. haidi: let's take a look at how we are shaping up in this part of the world. locate at trading -- looking at trading on the effects, we are seeing yet at half a percent, this after several days of pretty much weakness when it comes to momentum and volatility as well. take a look at the effects side of things, because we continue

to see that dollar strength really dominating as we see a fifth day of gains when it comes to the bloomberg dollar index. we still have dollar index topping that march 2020 p. that is putting a little bit more pressure when it comes to the aussie as well as the q. week, that trade deficit coming through new zealand a little bit earlier, weighing as well. we see trading on the back when it comes to that kiwi dollar, but certainly a lot of repricing when it comes to market expectations for what the rba will do in light of that inflation rate that came through yesterday. taking a look at s&p futures, we are seeing strength, 7/10 of 1%. we did see the s&p 500 more broadly, ending pretty much flat, but those gains, big momentum when it comes to tech. we could see some of those related asian tech stocks benefit in today's session as well. trading unchanged as we continue to see that fear of demand destruction coming from the chinese lockdowns and some of

these further covid restrictions. we are just getting the beijing case report for today. 50 local covid-19 cases for wednesday, that's reporting from state media. this as we see the government there expanding beijing covid testing, this is another lockdown that will replicate what we have already seen in shanghai that's expanding testing the 12 districts through to saturday. we have seen that slump in the equity markets, the currency markets on economic concerns, we are also seeing that the -- which is home to alibaba, their headquarters will begin mass texting. residents are urged to be tested every 48 hours covering most of the city's downtown area. let's get more analysis, i want to bring in their regional cio at ubs global wealth management. always great to have you with us. a lot of headwinds when it comes to china at the moment, a lot of concerns about whether they will

reach around 5.5% gdp target. you are looking at this as an opportunity. >> i think if you look at the longer term, the valuation for the chinese market is very attractive at the moment. we need to get covid-19 cases consolidated and meet the property markets recovered from the sales before we think that the market can rebound in the second half of this year. we do think that the government will use more given the situation there unless they ease more, the economic growth is nowhere near the target that they are looking at. we are probably talking about 4.2% right now. haidi: we saw a recovery in chinese tech. do you see that being extended to hong kong and mainland or are there fundamental concerns that will be driving for a while? >> i think it will drag for a

wild. a couple weeks before that the reglet tory crackdown in the chinese sector was more or less given the fact that it was reassuring. unfortunately, with this covid situation going on, this lockdown is in a big way. it's kind of hard to get any momentum where the chinese equity market is concerned. unless we get some signs of stability with covid-19 concerns, where they are in that sense, it's going to be very high before the markets get any momentum going forward. we had the investigations. all that is setting back sentiment and affecting investors and preventing them from coming back in a big way. shery: what are some of the defensive sectors that you like in this environment? >> we do think that tech stocks are attractive. you really have to be patient

and the chinese market. you need to buy with six to 12 months. you can't buy with the view that the market is going to turn around and make 25% gain. that is not something that you should be doing, he should be buying it with any months given the fact that it is really attractive. earnings revisions are down and in the next six to 12 months we should see decent coming through. we think second-quarter earnings numbers will probably be -- and then after that we should take it down. we do think there will be a recovery of sorts. shery: wet -- what role world japanese equity play, given the weakness of the yen and the boj double down on loose monetary policy. >> you are referring to the correlation between japanese yen and japanese equity markets.

it's pretty popular, given the fact that the nikkei is dominant. but i think the situation is quite different because of the fact that a week japanese yen was very high commodity prices means that a lot of the margins will probably be affected unless the projection is really overseen and unless the sales are completely overseas. there are very few japanese companies in that category. unless you're able to see the companies, they will probably be stuck trading in the type roots until the boj did something about the japanese yen and hike at 25 to 50 basis points if you try to avert this in the japanese yen. shery: it doesn't sell might they will do that anytime soon, does it? >> i don't think so, because of the fact that for a very long time there has hardly been any inflation in the japanese economy, therefore you want the inflation pressure to actually try to encourage the domestic consumption.

just seeing a little bit of recovery in the last couple of weeks and we have gain more momentum. on top of that, the global situation with the war in russia and ukraine escalating is the fact that the russians are getting exports to bulgaria and poland. there were hardly be any strong demand for consumer tech gadgets going forward. when you look at the u.s. with gasoline prices high, it will be -- to expected to increase over the foreseeable future. haidi: does the dollar remained a haven currency of choice, and what you do if you're feeling defensive? >> i think for the nail term, certainly, as we move closer to the fomc meeting where we expect this, and also the start of the finding, that will drive the u.s. treasury yields and extend

the gap between the u.s. treasury yields and all the other sovereign yields. that will continue to provide strong support for the u.s. dollar in light of the situation in the ukraine. we do think that the dollar, on a very short-term basis will likely remain the currency to watch. in the longer term basis, i do think structural inflation is higher than before and countries are probably not having their currencies. if you have the commodity prices in the u.s. dollar as well, you are just going to be asking for it to drive up the domestic condition. so i think on a longer-term basis, the strength of the dollar is likely to be less more than what it is right now. shery: regional cio at ubs global wealth management, always good catching up with you. thank you. the one company that has benefited from the weakness of their local currency, the won it stands on. reporting better than expected operating process. the weakness in the won actually

help their earnings. you can see the stock not performing as well as you would expect for a company that did pretty well with her consolidated net coming in much higher than analysts had expected, but remember samsung has lagged behind the broader kospi this year. sk hynix, which missed and operating profits yesterday is skating more than samsung at this point. we are also watching the japanese semiconductor manufacture set to spend up to $1.5 billion in share buyback and you can see they gains in the stock almost 5%. we are also watching softbank because it's the subsidiary arm closing in on an agreement to regain control of the chipmaker errors china operation and oust their rogue ceo. haidi: we are watching some of these movers in australia for the skew rising in the early part of the session, and we see them raising a for your output as well, as making some changes. it cost of third-quarter

shipments are rising 10% and their project is really ramping up just as the world's fourth largest iml producer is raising guns for annual exports as well as increasing shipments for fiscal 2022, and really looking at potentially extending that record performance. we have seen a big jump -- jump in iron ore futures in singapore. over 30% in the first quarter. we are also watching amp. we are seeing they are on the rises well after the assets fallon also flagging capital returns. they sell -- they sold the international infrastructure unit for 406 to 2 million australia dollars and said they would be returning the majority of net cash proceeds to shareholders. of course the capital return would be subject to regulatory shareholder approval. also watching the miner rising by just about 9% after boosting the copper target. let's get you to su keenan with

the first word headlines. su: we start with european commission president warning companies not to give into russia's demand to pay for gas removals. european firms have been scrambling to respond after russia cut off gas to poland on bulgaria. at least for european gas fires have given into moscow. >> our guidance here is very clear, to pay in rubles, if this is not for seen in the contract, to pay in rubles is a breach of our sanctions. companies with such contract should not exceed to the russian demand. su: china's cabinet has pledged to stabilize employment with the government's tough response to covid threatening the economic road. the premier says it was agreed more forceful policymakers shouldn't be taken to boost jobs. china survey jobless rate is a its highs since may 2020.

in norway's top two it comes to normalizing live alongside the coronavirus. this by hong kong and mainland china are among the worst. that's according to the bloomberg covid resilience ranking for april. in norway is followed by ireland in the uae for places where the pandemic is being best handled. the u.s. fell six spots to number 23 and the u.k.'s down two spots tor 12, both due to the number of fatalities. the capital founder has been arrested by federal agents a year after the collapse of the family office. prosecutors say he was behind a scheme to mislead banks and manipulate markets. he and his former cfo have both been charged with fraud and he pled not guilty and will be released on a bond of $100 million. this is bloomberg. ♪ -- global news, 24 hours a day, on air and on bloomberg quicktake, powered by 2700 journalists and analysts in more than 120 countries. i'm su keenan, this is

bloomberg. haidi: we have more on samsung's earnings would it means for the chipmaking sector and supply chain. coming up next, what to expect from one of the most closely watched boj meetings in years. we have the details ahead. this is bloomberg. ♪ omberg. ♪

>> we view the weakening, so far basically in line with what we see as fundamental developments over the last couple of months. we think it is necessary for japan to may -- have some form of control. >> the economy that goes along with a.

>> it means that we could get the concern. >> they are clearly signaling the monetary tightening. but -- >> they need to wait for u.s. yields to stabilize. the linking of it directly to inflationary pressure and then potentially to policy. >> probably they think about it. >> we either see rather big repositioning with the situations that will remain very difficult. >> i think it is somewhat the losing thing up to the market. shery: i expect a very deciding

decision coming up for the first time in years. it seems like it could be a live one. this as we continue to see the rapid weakening of the yen to a nearly two decade low. it's lower under his tenure, you have more policymakers out of japan talking about the yen. the finance minister speaking right now in tokyo saying that he hopes the boj will continue to conduct appropriate policy. this following the prime minister who has already urged the central bank to keep working towards the 2% inflation goal. the finance minister also saying that again, stability and force markets is important. markets aside moves and currency. referred those lines over and over again for the last few days. for more we are joined bauer bloomberg global economics and policy editor kathleen hays, it will be a good decision, i'm really excited for the first time in a long time. kathleen: we knew what word got -- we knew what was going to happen, and we know there could be something said at the press

conference in particular, and the policy statement where, how could the boj not express the extreme weakening in the end. let's start with the bloomberg survey, the latest one, 89%, no change in the negative rate. no change in yield curve -- yield curve control, which could boost the weak yen. the top part is add 0.25%. they will keep buying bonds to keep the 10 year jgb where it supposed to be and they will keep buying etf's, etc. what this chart tells you is that it shows that there is not much of a change in expectations until we get to 2023. that's when governor kuroda's five-year term will be up, and that's when many boj watchers say will be the appropriate time, depending on the economy and inflation for the boj to make this very important move. in terms of the weak yen, there is no doubt that it is being driven, in large part, by the boj. you just heard the imf division chief for japan say they still

need the stimulus. there boj is right, they've got a do that, but the federal reserve knows it has to start a more aggressive rate hike path, that's why we see the pressure continuing their and that's why currency traders are going to be watching for any change on the end. for a long time, governor kuroda has said that weak yen is good for the economy. of course, if your currency is weaker, your exports are more affordable to the countries you sell them to. that's the idea, but lately he has been warning about abrupt changes in the end. we certainly see dramatic moves. those are the kind of things that people will be focused on in any change there is something that could potentially move the yen, eve there give it a puzder help it weaken further. haidi: even when inflation seems to be coming to japan at last for the first time in forever, the boj is digging in its heels

because they don't think this is a sustainable type of inflation. kathleen: that's right because it's driven by commodity prices. commodity prices are not going to go to the sky, they are going to level out at some point and they will stop boosting inflation. and what the point he has made clearly is that they have to continue this aggressive monetary easing because they do have to get, as you said, sustainable. get to 2% in a stable manner. there still a ways to go. and also pointing out that this isn't demand full of inflation like we see in the u.s.. is different by commodity prices, that's why he doesn't think it sustainable. the prime minister himself, starting two days ago, made loud and clear he wants the boj to continue its efforts to achieve that 2% inflation goal. how to get there, by maintaining aggressive stimulus. that's what they have been doing for years and that's what they will continue to do. the one thing that is expected that they will have to revise

because they will give it again, they are expected to boost that inflation forecast to 2% and also to make it about cost push inflation versus demand pull in how higher prices are the economy because they leave you less money to spend. 10% in the survey think there will be some subtle wording that gives a different sense of guidance. a former board member is thinking, maybe for the second half of the year they will start looking at it. and they probably need that much time to see how all of it is. no one would like to see inflation sustainable at 2% more than governor kuroda. those are the things we will be focused on today when we get the policy statement in the press conference later. >> our global economics and policy editor kathleen hays with the preview. samsung posting a first-order profit with solid demands for premium smartphones. we break it down just ahead. this is bloomberg. ♪

shery: samsung beat estimates of memory chips and smartphones. bloomberg asian stocks reporter joins us. what's going on with the stock? it was barely up, now it's down. >> good morning, the samsung stock has been struggling so far this year, it has been underperforming kospi, and it has been the biggest net selling by foreign investors. we have several factors at play, one of them is there we korean won, but a we korean won against the strong dollar is not helping the share price. foreign investors have been producing samsung shares and other korean and emerging-market equities because of expecting the weakness of the korean won, and that's also still waiting on this as well.

in the future growth is still persisting. haidi: a lot has been over the foundry business. is this really one of the aspects we have seen play out in the lack of a move in the share price today? >> they have been keyed to a lot of -- and if samsung could come up with new growth and new bet on samsung's business, the yield issues have been battering the samsung's issues, investors will want more clear answers about where samsung goes on this chip and how it's going to secure new customers and compete with customers on key places that investors want to see the future growth coming from. haidi: our asia stocks reporter. take a look at some of the moves we are watching in the session.

we are watching suzuki on reports of a german program. buying back of ¥200 billion as well. as the hitachi construction trading lower after for your operating profits. expectations missed. this is bloomberg.

shery: the bank of japan is expected to keep its key policy measures unchanged, but we are watching whether or not they tweak forward guidance language. our next guest expects no change at today's meeting. for more, let's bring in the head of japan economics that the global research. is it that time of the year, and it's really and interesting meeting today. very closely watched one for the first time in months. some have talked about widening the 10-year yield or targeting a

shorter maturity yield and given the pressure on the yen, any expectations of that can happen? >> when it comes to the settings, including the plus or -185 basis points, i think it's highly unlikely that the bank of japan is going to change those policy settings today. obviously, with something like why cc, i don't think there will be a lot of advanced notice when they make changes and you'll get a lot of handholding and forward guidance. that said, governor kuroda gave his speech at columbia university last friday where he reiterated his devin messaging and talked about the fact that he saw no need for the bank of japan to follow other global central banks in pursuing tightening and normalization at the moment. never say never, but i do think that's the just of japan unwilling to touch those rate settings. >> what would that mean for the japanese yen?

>> for the bank of japan, just in the past couple of days, it has been a risk off in the markets. some of the selling pressure on the yen has slowed a little bit. another indication that the bank of japan might not have such a big yet negative impact in the fact that the bank of japan has been announcing all these unlimited fixed rate operations, including one that's going to last through today, this morning. and yet, the reaction of the currency has actually declined over time. so no changes kind of a consensus expectation. i don't think there will be a big fallout in the markets, but we will be watching what they do. haidi: do you look at the fundamentals when it comes to the yield differential and think that it is inevitable that we will see further weakness? >> yeah, i think so. our japan effects strategy team

came in being bearish to yen, not just because of the bank of japan, but for fundamental reasons like higher commodity prices are negative for a net importer like japan. another issue is that the japanese government has launched this university fund. we don't know what the exact portfolio allocation is, they won't disclose, but there's expected to be some yen and foreign asset buying coming from that for the fiscal year. at least until we get a turning u.s. fundamentals and people start to worry about the u.s. economy and potential backing off of said hikes, i think the yen will continue to be under bearish pressure. shery: if they don't do anything to -- haidi: if they don't do anything today and there is a risk that measures will change, when will we issue the conditions we are currently looking at continue to hold? >> one thing is, as for this

meeting, while we don't expect changes for the policy brief settings, there is one possibility of a change, and that is the change for forward guidance. currently the bank of japan has forward guidance to keep rates at current or lower levels for the time them to drop that easing bias or lower. so i think that could happen at this meeting, and if it does, some will say that this does not mean that tightening is imminent, but i do think it does give the first early step of the pipit towards potential policy changes. the second half of the year i think is more likely. shery: we continue to hear from japanese policymakers, the prime minister as well have this

broken record of how they are in the fourth market. could there be any intervention coming from the government side? i know they haven't sold dollars and by yen since the 1990's, but could this be a possibility? >> the short answer to your question is the pain threshold for effects intervention becoming considered much higher than current spot levels. saying it won't happen could be considered before dollar-yen at 140 or above. as a reason why japan hasn't had done a lot of buying intervention, it's a lot harder to do this because it will involve foreign u.s. treasuries, and you need the passive support of the united states. but all global central banks are dealing with an inflation problem. the inflation problem is worse than the united states. i think the u.s. does not want to see a weaker dollar, so i think the hurdle for intervention is very high. haidi: we see household names

really showing the pinch of rising prices in the weaker currency on the impact of importing materials. at what point does this seek through the japanese consumer, as well as does that mean we will need to see a more robust response from the government on the fiscal side? >> short-term, consumption pictures looking good. today we had march retail sales 2% month on month. very strong because we are coming out of the omicron wave and there is a lot of pent up demand an easy growth and consumption that will be over the rise in inflation. but what i do worry about is towards into 2023 when we get through this pent-up demand and get through the reopening and it comes down to fundamentals, this is a very strong inflation for consumers and wage growth is unlikely to keep up.

so i do worry about a slowdown in consumption and the end of the air towards 2023. haidi: always great to have you with us, especially on boj. let's take a look at how the yen is trading across. take a look at dollar-yen, holding steady, extending just a little bit of a decline as we see u.s. yields continue disorder. jgb is likely to follow treasuries lower as we see dollar-yen falling with him out 120 a level tracking u.s. yields. but we also watch when it comes to the aussie yen pair, such a popular trade. not much of a move. the aussie dollar has come under pressure from the broader dollar-yen -- strength. euro-dollar is interesting to watch, given a has fallen to the five-year low against the u.s. dollar. a lot of the fundamentals are pushing the euro to the side of further weakness there.

in fact, a lot of investors are talking about it pretty far away at the moment, but that would be the first time in two decades for the euro. but of course, the concern over the boj, not just for the yen, but a major factor in their decision as to the new term for the end, yuan and other emerging markets currencies in terms of the ends ability to trigger adjustments across the broader asian effects. let's get you to su keenan who has our first word headlines. su: we start with u.s. legislation which has increasing competition with china, which could face more delays. the legislation would provide more than $50 billion in aid for the domestic chip industry and has received broad support from lawmakers, however, negotiations can reconcile separate bills from the house and senate are yet to start and they could extend beyond the midterm elections. india's prime minister has called on states to ramp up

covid-19 vaccines for children as daily infections hit a six week high. public concern grows about the outbreak of a new variant. india was hit hard by the delta wave last year, which overwhelmed hospitals and lead to tens and thousands of debts. the capital founder has been arrested by federal agents. this a year after the collapse of the family office. he was behind a scheme to misleading banks and manipulate markets. he and his former cfo have pled not guilty to charges and have been released on bail. the pair are due back in court on may 19. global news, 24 hours a day, on air and on bloomberg quicktake, powered by 2700 journalists and analysts in more than 120 countries. i'm su keenan, this is bloomberg. haidi: our exclusive interview

with one of the world's biggest shipping companies causing early short-term disruptions to the supply chain. this is bloomberg. ♪

haidi: we are tracking the fallout of the global supply chain. u.s. is providing $670 million

in food aid to six countries in dire risk of younger because of russia's invasion of ukraine. the biden administration is tapping emergency funding powers not used since 2014 four global commodity suppliers. qualcomm has given a strong forecast for the quarter, both with the expansion into the markets. the chipmaker says demand continues to exceed chip supply but expects to strike a better balance through the year. samsung says it expects the supply shortage to continue into the second half of 2022. the world's largest smartphone maker reporter first her profits that beat estimates on premium smartphone sales. shery: we are not seen that in the stock price. it was gaining three tons of 1% at one point but it's down and accelerating those losses in the korean session. this of course as we have seen samsung lag behind the broader kospi. down about 15% this year already

outpacing that side of the kospi of 10%. you can see in this chart that how the market value has dropped below 20% of the cost before the first time since june of 2019. bloomberg terminal users can read more about those stories. our supply line on and i trade nl. china's zero covid strategy and ongoing lockdowns have many predicting more supply chain chaos across the globe. china has some of the worlds busiest ports in the country that account for roughly 12% of trade. one of the world's shippers sees the supply chain this year. the marine transport chairman spoke to bloomberg exclusively and told us why he's optimistic the supply chain crunch has turned a corner. >> most people talk about the poor condition and u.s..

maybe this year the shift waiting for the poor. more than 100 ships. right now the ship's weighting reduced to basin at 40. i think this is a good sign that it has been easing. the lockdown in shanghai, but people don't understand that because the government also pays attention to the regular shipping industry, so it's our point of view. the daily operations are not being interrupted, so this shanghai port runs as usual. >> how long were your container sitting idle. did you force delays? >> compared to last year, two or

three days, but compared to los angeles, we are waiting 10 to 14 days. so two or three days is not the situation. >> are you concerned about a slowdown in the economy in china? >> a slowdown in china economy, i think everybody agrees with this. we are more concerned about this. it's very important. but it shipping shanghai from asia to u.s. to europe. that's our final destination. >> do you see the china lockdowns worsening the global supply chain bottlenecks? is that a short-term problem or could at last the rest of the year?

>> i think everybody would agree all the government doesn't want covid-19 to spread or become more severe. but just maybe the government taking a different approach, and china's government decides to maintain the previous policy. they don't allow any single cases. as you can see, besides china, all the other countries are gradually trying to survive the pandemic. i think in the second half of the year, china was somehow maybe adjust the policy, so we don't for see the china economy slowdown will continue. we expect the economy to rebound in the second half of the year. >> the imf expects global trade to slow this year. do you see any signs of

softening demand across industry? is that a key uncertainty for the business? >> i agree that it will slow down due to the war in ukraine, and also the demand from covid. but i think this is just short-term. overall if you look at the world bank, i guess the next year, the gdp will have momentum. we are rather optimistic. >> the transport chairman speaking exclusively with bloomberg's yvonne man in taiwan, and speaking of activity in china, we are hearing that china is locking down a district after covid cases were detected in the port city in the northern chinese providence, locking down

the district on thursday after infections were found in the area. a closed-loop management system is in place for all villages, shops and businesses, with other retailers closed. this comes as we see mass testing in the city, and that is going to have serious ramifications, particularly when it comes to high-tech nickname tech companies. alibaba that are headquartered there, as we continue to see this covid zero strategy being rolled out across parts of china. let's get you a quick check of the latest business headlines. platforms at more users than projected in the first quarter, sending shares soaring, the company reported 2 billion daily users for its flagship facebook platform signaling a return to growth after the first ever decline in the december quarter. the social media giant has been losing momentum as the new generation flock to tiktok. mattel has reported

first-quarter results that beat wall street estimates, supported by barbie ed hartwell sales that decide the usual slowdown. the biggest gains in early months. they are in talks with two private equity firms about a potential buyout. in an interview with bloomberg, the ceo kept quiet about any talks. >> our strategy is working, we continue to perform very strongly, we are now an ip driven high-performing company. haidi: china's biggest oil refiner has increased profits for the first quarter even as the country's worst pandemic outbreak threatens a pullback. they reported net income of $2.6 billion with 24% last year. the firm's business saw a 15% hike in profits. the first quarter profit surged are growing demands for election

vehicle -- electric vehicles. they posted a more than 240% jump in net income from one year earlier. that is hat the high end of the company's early preliminary figures. these as record sale companies cap ship -- chip shortages at higher costs. shery: we will discuss the yuan as bangs forecast further weakness ahead. this is bloomberg. ♪

shery: we continue to watch the chinese yuan that pared back its biggest loss since 2015. we see moves from policymakers to support the economy, that a combination of the protracted covid lockdown and the narrowing chinese rate premiums have founded several banks to cut their forecast. the echo -- economic backdrop has announced an outflow for chinese capital markets ahead of records in march. asset managers like morgan stanley have been strong and bears to go underway on chinese stocks. haidi: some wall street banks are cutting profit estimates as the earnings season gets into full gear. let's bring in our asia equities

coverage reporter. which companies are we talking about and what the outlook? >> good morning, with what is happening through the lockdown, that is expanding. we saw some news about them going through mass testing. people are obviously worried. first came the brokerage were saying we want to downgrade and cut gdp forecast away from the target of 5.5% in next they say they need to cut profit forecast. so it's going to be a little bit tricky. yesterday we saw companies like byd and sinopec's report and a lot of the first quarter we won't see a complete full picture of this given that the lockdown really accelerated this past month, particularly in shanghai and beijing. but for example, ubs is saying we will tweet down our expectations by a couple of

percentage points, goldman yesterday, he came on talking about how they expect the earnings downgrade. we are seeing other brokerages talk about four percentage points or five percentage points different than what they expected, and what things look like now. so it's a bit of a foggy, muddled picture because we come off with some pretty strong earnings, and then met with this inevitable slide because of the outbreak. shery: how responsive our markets being when it comes to chinese policymakers try new talk up the economy? pledging to support the economy? catherine: it has been a tricky one. before yesterday i would say it hasn't been a difference, people are looking for clues and such, yesterday was an interesting situation because president xi said he would do in all-out push

on infrastructure and that lifted the market. i think people are still very cautious. we saw a lot of brokerages say, this is good, we are excited about it, but how do you boost infrastructure when the country's lockdown in many parts of the city are lockdown. it still a bit of a mixed bag and we will see how things open today. shery: we continue to watch the stocks given the ongoing restrictions in china. china placing it under testing mandates. companies including the alibaba giant spraying the headquarters so we are watching those companies. we are keeping an eye on chinese developers, walked downs and beijing. haidi: those developers do not need any more downside pressure given that the two in the sector are ready. all eyes on china for the development. we had that port city under

pressure as well. that's it for daybreak asia. markets continue next and we look to the side of the trading in hong kong, shanghai and shenzhen. china open is next. this is bloomberg. ♪

♪ [static] david: this is my kitchen table and also my filing system. over much of the past three decades, i've been an investor. [applause] the highest calling of mankind i've often thought was private equity. [laughter] and then i started interviewing. i've learned from doing my interviews about how leaders