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markets: asia" coming to you live from sydney, new york, and hong kong. annabelle: we are counting down to asia's major market opens. haidi: australia has just come online. beijing is reinforcing orders against excessive virus curbs. covid zero in seen hurting china's factory activity in november. pmi's are set to contract. and investors await jay powell's big speech on wednesday. shery: we started breaking news out of south korea. industrial production missing both on month-on-month and iran your numbers. month-on-month there is a construction for the third consecutive month of 3.5%. the expectation was for contraction, but not as big as this one. also every revision downwards for the biggest month of 1.9% contraction for september. astro production year on year,

it contraction of 1.1%. a forced contraction since september of 2021. this number has turned negative. the expectation was for a bit of growth, but really what is happening in the global demand picture is probably be reflected, tends to be a bellwether for these economies. we are expecting japan industrial production numbers as well, so we will get an indication of where the regional number is heading in the moment. u.s. futures are coming online. not a lot of movement. not surprising, given in the new york session we had lots of fluctuations, we are talking about the s&p 500 ending slightly down, as traders were staying on the sidelines ahead of chair powell to speech tomorrow. and we of course have the ongoing virus situation in china

as well. we got home price data, dropping a third straight month, giving you an indication of where the higher borrowing costs are leading economic numbers in the u.s. the 10-year yield held steady at that three-point 74 level. wti crude is holding to the gains we saw in the new york session. as well, it is all about the uncertainty over the opec-plus decision this weekend. annabelle: really it is just a bit of a wait and see mode, as you say, ahead of jay powell's speech on wednesday. he also had the yield curve inversion for the first time two decades. another recession indicated to us, perhaps. here for australia, we are seeing the asx 200 looking flat. no many changes in the bond yield space either. the aussie dollar is coming off the recent highs that had been driven by what is happening in chinam specifically that officials are looking to not only boost vaccination rates for

the elderly but also, planning to steer clear of the harshest covid containment measures. that has been a big theme for china stocks this month and generally in asia. if you look at this terminal chart, we are on course for the msci china to see its best month in 23 years. we had seen the chorus of wall street strategists turning bullish, and then peeling back a bit with perhaps the sign aging would not lifting restrictions and starting to expand them instead. now, we are back on the flipside it again with the latest news. [laughter] haidi: never a dollar moment when betting on or against china , for that matter. let's get you more on what is going on with the covid zero situation. officials are adjusting covid restrictions in this city that is home to apple's biggest iphone factory. beijing told local authorities

to avoid excessive curbs on containing the virus, following the protests. our chief rates correspondent for asia and mliv contributor garfield reynolds is here, as well as emma o'brien. is this a conciliatory olive branch, given the unrest, that authorities are listening when it comes to china, to avoid the harshest of these restrictions? emma: i don't think it is a response to the protests by local officials there, you are attempting to do what beijing told them to do. you had the reinforcement from the top bureaucrats yesterday in the capital that they need to be more targeted, less destructive. the problem is they said that just over two weeks ago. cities tried to dial back, do less testing. while joe was among them. but they found covid

cases searched again and they had to employ broader lockdowns. it doesn't mean an end to lockdowns in china or an end to restrictions. i think you'll still see this tension between the situation on the ground, and local official'' desire to do what their masters in shery: beijing have ordered of them. shery: it would help if we could get more people vaccinated. are we seeing anything else about possibly vaccinating the vulnerable? emma: i think it was a positive sign that they addressed it directly. the gap in elderly vaccination in china. china had approached it the reverse to the west, they said people who were vulnerable or had other conditions should not get vaccinated, that it made them particularly vulnerable to complications. but they are trying to wind that back, dial back the messaging, and reinforce with older people that they need to get the shots.

they stop short of the mandate, which we saw in a lot of western countries a year ago, which was very helpful in getting vaccination rates to 90% across locations. but they did say that older people would have to provide a reason for why they are not getting vaccinated or not getting boosted, they cannot just say, my doctor said not to. we will see in the numbers whether this has an effect going forward. haidi: however you look at it, november was a watershed month, garfield. garfield: one thing that did strike me hard when looking at the chart on the television was how many of those previous really large green arrows when there was a surge, then followed by not just one, but several red lines going back down. so past performance is not

guarantee of the future, you have to be a little bit aware that investors have gotten over excited, and that is precisely because, as emma o'brien pointed out, there is a conundrum for china's policymakers here. yes, they want to move away from the extreme covid zero policy's that even before there is some protests, were starting to understand that that is perhaps causing more economic pain than they want. at the same time, we have concerns that if they do relax restrictions to rapidly, you will get an extraordinary burst of cases. and is chinese medical infrastructure ready for that, and how much of an impact that could have. so there is reason to be skeptical that this burst of euphoria could continue,

whatever china ends up deciding is the best course for dealing with the health and societal problems created by covid. shery: shery: perhaps not as consequential for chinese markets, but more for global market sentiment, chair powell speech this week, will the actually poor some cold water in all of that optimism that we have been seeing about the potential fed pivot? garfield: well, there is the potential for that, but it will be hard for powell to get too much traction on that front. on the one hand there is pretty strong expectation that he will stick to a relatively hawkish tone. on the other hand, i don't think he will move the needle enough that you would see the markets start pricing at 75 basis points in december. so just the optics of going from 75 to 50 will get investors continue to be excited by the idea that the peak for fed hawkishness is done, just like

the peak for inflation is done, and therefore you will see a rapid shift to know rate moves upwards and potentially, still got pricing for at least one cut in the second half of next year. that is a sort of thing the fed has regularly pushed back on. they are firm that even if they do stop at some point next year, they will want to hold rates until they see inflation down close to target. so that creates tension over the medium-term, in the short-term, i think it will be very hard for jay powell to do too much to rain on what is a very strong risk appetite parade. haidi: garfield reynolds in sydney and bloomberg's emma o'brien, there is welcome, without top stories. let's get to vonnie quinn. vonnie: andrew bailey says the u.k. bond market is still not

able to absorb a massive sale of assets. his remarks highlight the upheaval in financial markets in the u.k., following liz truss's you fed budget statement. he also said the central bank was not properly briefed on the extent of the fiscal statement. sources say argentina's central bank expects to keep its key interest rate unchanged at 75% until next year. we are told the central bank is preparing to hold if that forecast is confirmed. the estimate suggests monthly inflation could slow to 5.5% in november, down from 6.3% in october. blockfi will try to collect about $680 million owed by ftx's alameda. the company made its first appearance in bankruptcy court, seeking approval to keep operating, it's also developing a plan to repay creditors owed more than $1 billion, by re-organizing or finding a

buyer. bloomberg learned that biden administration might label the russian mercenaries known as the wegner group, a foreign terrorist organization. the leader is a top supporter of vladimir putin and his ukraine war. sources say the move would allow the u.s. to pursue persecution of the military firm's members. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. shery: still ahead, we preview china's november pmi readings. economists are expecting a contraction in activity thanks to covid zero, and of property slump. state street global advisors tells us about their recession outlook for the u.s. this is bloomberg. ♪

haidi: william dudley sees the full deposit rate hikes once they get to the 5.25% to five point 5% range. but the former new york fed president told us policymakers may need to hold at that level for longer than markets are pricing in. >> the peak is probably the 5.5% range.

it will be hard for the fed just stop if we are still at an unemployment rate below 4% and underlying inflation is still 4% or higher. i think we get a series of smaller rate hikes. but clearly the fed's strategy here is longer ever than higher. if we get to five point 5%, i think they will relent and just let it sit there and wait for that restrictive monetary policy to slow the economy down and generate more slack in the labor market, and then gradually pushh both wage inflation and services price inflation down. >> this is basically pretty much in line with officials of been saying. but the market is still pricing in rate cuts by the end of next year. what does the fed have to see to start becoming less restrictive, and i don't mean that with respect to keeping rates where

they are, i need actually lowering them in a significant way. >> they have to be highly confident that they will achieve their 2% inflation objective. it doesn't mean inflation has to be a 2% when they finally relent, but highly confident means they have to see significant slack in the labor market that brings down wage inflation to the 3% to 4% range, and they need to see the inflation pressures be much less persistent and broad as they are today. maybe to seek inflation at the 3% range and heading down. once they have accomplished both of those things, then they can start to relent. it will take over some time, because the economy still has considerable momentum, and it will be sustained by past inflation that we have seen. . for example on social security, 8.7% increase in their checks come january. they will spend that money and that will keep the economy moving along, and that will make

it hard for the fed to restrain things. shery: bloomberg new economy columnist and advisor to bloomberg economics, bill dudley. our next guest says the inflation obsession will gradually shift to growth worries. joining us is guarev malik, chief investment advisor at state street. it is the reason why we're seeing so much sure on the fed as investors are pricing in a rate cut? >> investors are optimistic about the u.s. relative to the rest of the world. i think carenet peak sometime in , call that q1 of next year, whether the rate is 5.25% or 5.5%, as bill was alluding to earlier, we peak in the first quarter.

then you have two support for the dollar, growth occurring on a relative basis -- i heard the commentary earlier about china, that makes a huge difference on the growth side. . the other support is basically risk aversion, when we take the worst news under pressure-ukraine situation is already in the price, unless we have something unconventional occurring. investors are trading on those things. but i agree with you that it is basically a rate cut coming at some point in time, so the carry advantage declining next year is something investors are hoping to trade into. shery: how is chinese growth in terms of the broader developing market space, how important is it? gaurav: very important because chinese growth is linked with the rest of em and a lot more linked with the eurozone, less so linked with the u.s.. so it has the potential to continue producing this decline occurring in the dollar, and

investors being able to rebalance their assets from u.s. non-us. you look at data from 19until now , if some of the most extreme repositioning have seen with, particularly institutional investors, in terms of their preference for dollar-denominated assets. that will not change unless investors see signs that the dollar will start its decline. it will continue for some time, and chinese growth is critical to that growth advantage reducing for the dollar. haidi: and of course chinese growth being critical to that. covid zero in its fate is critical to the chinese story. when you say are optimistic about the chinese open, is it a staggered reopen? first quarter of next year? how much are you counting two steps forward and one step back once we get some actual formal reopening? gaurav: i think investors after

the first communist party meeting, tended to basically trade chinese assets on ruble's. we will wait to see what actions they will take. the action could be positive. i think perhaps march is the next point in time where you will start to see things occurred from a developing standpoint. the march timeframe. but i think the news will incrementally continue being more positive out of china, specifically providing more support on the fiscal side, the monetary side, anything that can be growth-supportive, i think that will continue. again, you said about one step forward, two steps back, i think we continue thinking about that, but right now i would say the news could be more encouraging than discouraging. heading into the year, we are

still underweight their assets, but i think is the year progresses and receipt some of those worries, it could be time to start thinking about adding to risk assets. it would be non-us we would be looking at because it has a heated contagion -- it has a huge advantage. as a real chance to outperform. haidi: what are you liking in credit? i know you prefer investment grade over high-yield, where are you finding those opportunities in asia? gaurav: i think corporate credit opportunities exist across the board. in parts of em, in parts of europe, and in parts of the u.s. in all of those areas we are generally seeing that rates are still super low. distress rates are rising up across high-yield and in

investment grade, but i think still, most corporations across the world to a really good job of both extending the maturity of your credit, and also locking in lower rates. the next big test comes in towards the end of 2024 when there is more maturity to deal with. but between that period, if our case plays out in the fed actually starts going into a growth-obsessed mode versus inflation-obsessed mode and starts with cuts, that will be good. . against that backdrop, looking at trading when it is -- looking at averages across the world, it sounds like a good opportunity to be buying selectively in credit . we opened the year underweight. right now we are neutral on the credit side. still underweight in europe,

asia and the u.s. on high-yield. but credit, we are pretty much neutral right now. it is more so of a duration play. shery: good to have you with us, chief investment strategist at state street global advisors. we have breaking news for you at the moment from capitol hill, we are hearing the senate is voting now to protect same-sex marriage, and it has passed 61-36. the bill will now go to the house. the final passage of this bipartisan bill to protect same-sex and also interracial marriage, in fact. but the vote will now go to the house before being sent to president biden's desk to be signed into law, this, of course, as the supreme court is reviewing legislation and a decision that had legalized same-sex marriage in 2015. this is not necessarily a national requirement, according

to the bill, but all states -- it would require individual states to recognize another state's legal marriage. basically giving more clarification as this debate on same-sex marriage continues to shift in national politics here in the u.s.. the senate voting 61-36 to protect same-sex marriage, and once that is clear, it will be sent to president biden. plenty more to come. this is bloomberg. ♪ >> to ensure the provisions of the bob jones case --

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haidi: a quick check of the latest headlines. shares jumped for this company in the u.s. after the chinese videogame company ported third-quarter results that

expectations. adjusted losses were better than expected will topped estimates. executives are promising strict cost control measures to improve margins and narrow losses. nomura sees a potential revenue boost from a deeper push into equities, private markets, and wealth management. profit last quarter fell short of estimates, by the ceo says japan's biggest brokerage is seeking new revenue streams, as raising interest rates and global volatility sloki pillars of its business -- slow key pillars of its business. we will have a deeper look into that and also a preview of the november pmi numbers in china when people come, they say they've tried lots of diets, nothing's worked or they've lost the same 10, 20, 50 pounds over and over again. they need a real solution. i've always fought with 5-10 pounds all the time. eating all these different things and nothing's ever working. i've done the diets, all the diets. before golo, i was barely eating

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vonnie: this is "daybreak asia". i am vonnie quinn with first word headlines. officials are adjusting covid

restrictions in the city that contains apples biggest factory. they are still limiting movement from hundreds of apartment blocks. it comes after beijing reinforced an order from local authorities to avoid excessive curbs in containing the virus, allowing protests. alibaba's founder has reportedly been living in tokyo with his family for nearly six months. the financial times quoted sources saying he has been keeping his activities to a minimum, while still pursuing business interests. he has kept a low profile since criticism of chinese authorities in 2020, proceeded beijing's crackdown on tech firms. a federal jury in washington has convicted a leader of the right-wing oath keepers group of the dishes currency over the u.s. capitol riot of 2021 -- of seditious conspiracy over the u.s. capitol riot of 2021. three other people were acquitted of the charge. it is a major win for the justice department, which has two upcoming trials involving

the rarely used seditious conspiracy charge. the usa advanced to the knockout stages of the world cup in qatar, with a hard-fought 1-0 victory over iran. star forward christie and julie sick was taken to hospital after crashing into iran's goalkeeper after scoring the winning goal. the americans now face the netherlands on saturday. england also advanced, defeating wales and setting up in knockout meeting with senegal. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. shery: let's see how the markets are setting up for the asia open now. we have seen a lot of fluctuations on wall street, at least. annabelle: we are 30 minute now from the open in japan and korea and we have two factors investors will be focusing on in the session. first, what is happening in china, and also what is

happening in the fed. jay powell is to speak wednesday and the expectation very much is that he will be enforcing the participation in markets, that the fed will start to slow the pace a bit rate hikes next month, but also that the fed and officials there need to keep up the fight against inflation which is going to last into 2023. ahead of that, we are rangebound in the session. australia is fractionally lower, 30 minutes into the session. sticking with the fed, yield curve inversion is something we have been watching closely. if you see that 2's and 10's curve, we are nearing extremes of inversion. you look -- that is not the right chart, but essentially, yield curve inversion is typically a good indicator of recession. analysts saying that it could also be telling us about the fed time is nearing its limit and there are signs that long-term rates have peaked.

another thing is china. we will be discussing that, there is that expectation that china could start to pivot away from its covid zero policy, by doing things like boosting the elderly vaccination rate, sticking away from aggressive containment strategies. we have seen a move into equities and fixed income. you can see the ramifications of that in that spike in the 10-year yield, really telling that there is more optimism in china around the economic outlook. haidi: the protests in china are really adding further uncertainty to what beijing's next steps will be when it comes to reopening the economy is at 620. joining us now is chief upper economist at s&p global ratings, louis kuijs. very nice to have you here in person. what does the reopening look

like? we know the biggest challenge for china's demand and broader sentiment at the moment is really covid zero policy. louis: we are looking closely at that. we think we will eventually see a lift in restrictions that have been hammering domestic consumption, the service sector and even the production side. it will get a little worse before it gets that her because as we have's -- before it gets better, because as we have seen with other countries, it's not easy to move from a dynamic zero covid regime, one where we kind of start to live with covid. haidi: you also make the point in your latest notes that even if we get to a pre-covid level, a level of normal growth for china, that comes with enormous longer-term complications. this chart talks about the ongoing demographic challenge of the aging population. we are also concerned with things like the middle income

trap as well. when you look at numbers like, 1.2 billion people over the age of 18, to hundred we the people over the age of 65, the yellow part is ages 0-14, the decline in the birth rate issue as well, the longer-term challenges for beijing are perhaps even more immense. louis: everybody is focused on the short-term most of the time, but we need to look at the long-term as well. and no doubt about it, china is facing serious challenges. my graphics is unfortunately only one of them. there is that -- demographics is unfortunately only one of them. there is the rebalancing of investment which makes it hard to grow, if you invest less, right? we have the decoupling efforts from the u.s. and other countries. china is facing many challenges. when we add everything up, we still think china will continue to catch up in terms of how far it is from the u.s. and how it is able to eventually close some

of that gap in income, but, it's trend rate of growth will continue to come down for a couple of decades. haidi: you mentioned productivity productivity of debt has been an issue as well. do you see increasingly that the tools that the pboc, the fiscal tools that the government have to rely on are becoming less effective? louis: in quite a few ways, policy has become less effective both on the monetary side. on the fiscal side, things are complicated because local governments have to do so much of their spending in china and are responsible for a lot of their items. local governments are under strain at the moment because of covid, and the week property market. the whole policy regime in china is quite a bit under stress. the pboc also looking at ways of, how can we still try to support the economy little bit if the u.s. is moving in the other way?

the tightening of monetary policy globally makes it hard for the pboc to try to ease its stance. shery: and yet they are trying. we saw the rrr cut that we have been very skeptical about, given nobody actually wants to borrow money, so at this juncture, what do policymakers do? louis: i think, you know, a lot of people agree that at the moment, really what policymakers needs to do is shift on the corporate side. nothing else matters a lot if that doesn't move -- shift on the covid side. shery: even before covid, though, we had seen a growth momentum stalling because of the demographic issues because of debt issues haidi talked about, very perennial issues with the chinese economy. so after you loosen covid zero, what is next to be able to rein in all of that coverage and also

boost productivity question mark louis: we are facing really big challenges in terms of that trajectory to a more sustainable covid regime, right? i am not super negative on china's longer-term outlook, because we have actually seen them taking more awareness, looking out for financial instability, reining in a bit of the de-leveraging, there is much less de-leveraging than there was six years ago. the challenges are there, but i think china is still able to continue to grow. haidi: you talked about the decoupling between the u.s. and china. do you see much decoupling regionally? how dependent is outlook for the rest of asia, emerging asia in particular, is that intertwined with the fate of china now?

louis: there is a lot of soul-searching going on in these economies. how do i position myself between the u.s. and china? i don't want to give up neither. so this will continue in the coming years. we will need to see how that plays out in terms of supply chains and with trade. i do still see in this region, quite a bit of interest to continue to engage economically and to not give up too much of what we are gaining by economic interaction. so i am still personally hopeful in terms of the economic aspect of this. on the political side, we are seeing significant changes. some parts of the economy are being undersized, but i think there will be a meaningful part of the economy where -- some parts of the economy are being politicized, but i think there will be a meaningful part of the economy that it will not be dominated by politics, and supply chains will survive. haidi: we are seeing that even as the diplomatic partnership

has deteriorated, that is continuing. great to have you here, louis kuijs, chief economist s&p global ratings. downplay expectations about policy change at opec ahead of the meeting this weekend. we will look at recent headwinds in the energy market, of course, or send the crisis in china. -- worsened by the crisis in china. this is bloomberg. ♪ ♪ we all have a purpose in life - a “why.” maybe it's perfecting that special place that you want to keep in the family or passing down the family business or giving back to the places that inspire you. no matter your purpose, at pnc private bank, we will work with you every step of the way to help you achieve it.

so let us focus on the how. just tell us - what's your why?

shery: this weekend's opec-plus meeting is shaping up to be a crucial one with oil having erased most of its gains on the year due to recession risks and the slowdown in china. we have more from bloomberg's wait time. china is important when it comes to global oil demand. can you give us a sense of how hard the man in the country has benefits and how it has been priced in the market -- how hard demand in the country has been hit and how it has been priced in the market? wayne: demand has fallen to the below 2020 levels. prior to the current covid wave, the initial expectation was chinese oil demand would see a strong uptake from the third two the fourth quarter of this year. that expectation has officially changed now, we expect third quarter fourth-quarter demand to flatline.

however, from the first quarter two the third quarter of next year, we expect a significant drop in china's oil demand probably to levels below the second quarter of this year when the previous covid-19 wave occurred in the country. they way that we are seeing it priced in the market is not just via bearish moves in prices as well as falling spreads, but also the huge discount in spread. it is being reflected in the december contracts through to march next year which essentially means the markets expect asians were demand to remain weak in the coming four months -- expect asia's oil demand will remain weak in the coming four months. haidi: it is a juggle over factors they are trying to deal with at the moment. wayne: yeah, we expect that opec+ would be aware that the likelihood of them making deeper

production cuts is one of the key, one of the only key factors supporting oil prices at the moment. but even if they were to announce a large enough cut to give a boost to oil prices, they are essentially working against headwinds like demand destruction and recessionary risks. these headwinds can become significantly stronger than oil prices. so while cutting output might the instinctive move, we think it would make more sense to keep the output unchanged. should they proceed with output cuts, they would have to go big, something like one million barrels a day of cuts, on top of the cuts announced in the previous meeting. essentially, they either have to go big, or do nothing at all. we are leaning slightly towards them keeping the output cut unchanged, but we will see. haidi: bloombergnef's wayne tan

there ahead of the opec+ meeting. restricting russian profits whilst ensuring crude which is the markets is important. volatility in all markets means governments must take a longer-term view. >> i think it is trading lower. it is a more complex picture. clearly as you noted in the beginning of this interview, prices of crude and brent have come down. just a few weeks ago, putin was getting significantly higher prices. so we cannot match the price cap just to a daily change or a weekly change in prices, we have to make it responsive to the market, but also with a bit of a broader perspective. we have to look not just at the lowest possible barrel putin is selling, which might be at below

65 for $60. we have to look at the totality of what price they are getting for their crude. the good news is that he is getting significantly less money today than he was before, and his economy continues to degrade significantly. that is the good news and that is the pressure we were trying to make sure to go understands, that he cannot continue bombing innocent civilians, and now against making sure they don't have in the dead of winter. so there will be consequences here, but we also want to make sure the pressure is felt on putin and russia and not on the u.s. and our allies around the world and in europe. >> and of course, that means natural gas as well. is that going to work? a lot of people think that is not going to work. >> well, that is an e.u. cap they are working on and that they announced last week. we will have to see how they decide to implement that.

overall, the most important thing about the natural gas price is that europe, against all the predictions a couple of months ago, they have been able to fill their storage levels to 95%, which means they will be able to get through this winter comfortably, hopefully. and that the united states will continue to play the role we have in enabling them to do that. so the alliance against russia is not only stronger politically, but in the physical energy markets, we have worked very closely in order to be able to reach this result, and i am glad to be able to see that our alliance strong and that europe would be ok even with these elevated prices. shery: amos hochstein, speaking with bloomberg david westin. coming up next, the korean government is set to resume talks with striking cement truckers are defying in order to return to work weird the latest in a moment.

this is bloomberg. ♪

haidi: just waiting for japan industrial numbers to come out for october. we are getting them now. a decline of 2.6%. the month-on-month preliminary number, much worse than

expectations of a contraction of 1.8%. a second straight month of falling in october. we saw a slowing in output of machinery and elements like equipment to make chips and lcd displays. here or near, the number was 3.7%. the survey was expectations of 5.1%. we saw that in terms of a small rebound expected in november, we saw the catch-up when it comes the production of automobiles. but bloomberg is seeing a downside risk, including the core cpi. japan about 3% as well, and overall effect of dampening consumer demand. we also see the dampening impact from china as well, a negative for japanese producers. the yen, though, set for the

best months since 2016. we have seen a strengthening, the most we have seen in more than six years, this month, amid the expectations that the fed will slow. and get a quick check of the headlines. amazon is selling $8.25 billion of investment grade bonds, raising funds ahead of anticipated market volatility after inflation data comes out thursday. the funds may be used to repay debt as well as found acquisitions and share buybacks. volkswagen may ask foxconn technology to make sport-utility vehicles in the u.s.. sources say the german car is in talks with the taiwanese tech firm to make models for its scout brand. the new ceo identified success in the north american market is one of his 10 top priorities. shery: south korea's transport ministry's negotiations with

striking truck drivers are due to resume after the government ordered them back to work. our guest joins us now. still can't get over the fact that our government is trying to get a portion of their citizens and force them into labor or they could face three years of jail time. no wonder some of these people don't want to go back to work. guest: yes, the unions say that they will still continue to go on strike, as you mentioned. although, as you said, they will meet this afternoon. but the chances of them reaching consensus are pretty slim, because, as you can see, the government is still saying that they can not guarantee the minimum wage system forever, while the union is actually saying that they want to expand that system into other industries. so they have not changed their

petition yet. the situation is very serious in the country, because it is not just cement workers, but actually, other unions in other industries are planning their own strikes. so it seems like a lot of workers are trying to make their own alliances. also, the strike seems to be widely spreading the country. haidi: we have seen for example subway workers going on strike for the first time since 2016. how widespread could this be, spreading to other sectors and other industries, and what does it say about the labor movement in korea? heejin: sure. we have a rubric. there is already a strike by subway workers in seoul this morning. i also experienced a bit of

heavy traffic in the city because of the subway strike. and we have another strike by the railway workers as well. the subway and railway workers are demanding more workforces at the site. but the government and also the subway operators are planning to actually layoff a lot of people in the coming years. in terms of other sectors, we also see builder union workers are planning their own strikes. they are known as are known as the strongest labor unions in the country. and we also see this strike is spreading into other sectors. this is definitely disrupting the supply chains in the countries, such as deliveries of cement. it dropped nearly 90% in the country.

also, there is a tire maker and an automaker, all struggling and getting their components. shery: bloomberg's heejin kim, the strikes still ongoing in south korea. we are awaiting the market opens there in japan as well. apple suppliers are in focus, given what is happening in the city of hangjho. toyota is producing 771,382 vehicles in october. we will watch the automakers. this is bloomberg. ♪

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shery: this is "bloomberg markets: asia -- this is

"daybreak: asia." we are counting down to asia market opens. in the last hour, more indication of the beginning google demand, with industrial production both in japan and south korea, surprising to the downside. haidi: and yet, what a watershed november it has been for the markets, particularly when it comes to chinese markets. the roller coaster of sentiment continues. we are writing -- we are riding high on hopes that the measures being applied in guangzhou it become market wide. annabelle: china and the fed the two big things towards the session today. we didn't see much of a move in the 10-year yield in the session prior. we did see the yield curve inversion reaching new extremes. that is typically a reliable

recession indicator. it could be tested again today as jay powell, he is due to give a speech. in that, he is expected to indicate the need to moderate the pace of rate hikes for the months ahead, but also to keep up inflation fights. looking fairly range-bound at the start in the yen, even though it is on track for its best month in more than six years in terms of strengthening. given we had seen changing expectations around what officials will do. we are of course also reflecting on the data. we had industrial production coming in, far short of what economists had been predicting. also what is happening in korea at the start of trading, we saw industrial production also declining, 1.1% on the year in october. well short of estimates. also keeping what is happening with the korean won, sitting

study, in wait and see mode ahead of what the fed does. tech stocks also looking weaker given we saw three days of losses for the nasdaq. let's check on australia. we see in terms of general business confidence in australia falling, this according to the anz report. business outlook also dropping there. we are also being led lower today, the asx 200 declining. just one section is moving to the upside, materials. the likes of fortescue, hp and rio tinto are in the green today. that is probably down to what is happening in china. the reports of officials wanting to boost vaccination rates amongst the elderly there. they also want to avoid the harshest containment measures. that is a positive for the chinese economy.

also helping to boost oil prices. wti is again hired this session. but that is also down to expectations of what will happen at the next opec+ meeting. shery: our next guest says it is a glorious way to start the december rally with the last hawkish fed, framed by potential easing of the covid zero policy. joining us is stephen innes managing partner at investments. you putting your note, they must be dreaming, please wake me up. we had moments of optimism in the past just to get a reality check from fed officials. we will see that from fed officials? [laughter] stephen: it's a good question. we have had seven pivots priced into the market this year. it is one of those ongoing stories. but i think investors will tune into the speech closely. it will provide the most unambiguous indication of what the fed thinks about the most

recent financial conditions. what will pulsate? will he hint that -- what will powell say? will he frame that with the hawkish rapper? for me it is not the quantity of rate hikes, it is the higher for longer narrative. this is what we have to be careful of when trying to interpret what the fed is doing right now. shery: depending on what the fed does and that tail risk, what are the worst and best case scenarios for the markets going into 2023? stephen: if it came out a bit more hawkish, it would imply that the cycle recessionary risk is priced in. but is he going to clampdown on the markets question mark that is what we have to wait and see. the fed always tells us that

they are not watching stock markets, but do we believe them? of course not. but we also have to remember that we have a lot of liquidity getting drawn out of the markets as we enter the new year. so there are going to be a lot of factors to deal with, not just the fed interest rate hikes, but qt. we are not even talking about the recessionary risks being priced into multiple recession gauges throughout the market, mostly through that inverted yield curve, which is getting really hard to ignore. it has not been this inverted since 1981. that is a big problem markets will have to face when we get to the early part of 2023. haidi: is the stronger dollar still going to be an issue for markets, particularly em? take a look at the pullback the same time that we are seeing the outperformance of emerging market stocks the most in 13 years, over there developing market -- over their peers.

stephen: the markets are very much watching the inflation narrative and feeding off the fact that inflation will be favorable for u.s. yields. the biggest problem that i see right now and it is an obvious factor for exporters in asia, as far as the currency goes, is that we are heading into global recession. i also don't know how that is going to really favor selling dollars into 2023, because traditionally when we have a recession building in the market, stocks go down, and people cover their risks through the safe haven u.s. dollar. it's a bit too early to throw the u.s. dollar bullish thesis 2022 playbooks, we have an evolving story on our hands here. i think we are definitely going to see g10 easing throughout 2023 at some point -- perhaps not easing, they will take their foot off the rate hike pedal.

but without growth returning in any significant form, we are going to have trouble selling the dollar in early 2023. haidi: do we throw anything out in terms of conditions for next year? are you comfortable with having any strong convictions, at least for the first half of next year, or is this going to be another year of trading where you try to stay alive on your feet? stephen: we just fly by the seat of our parents. [laughter] we are very much risk-averse -- by the seat of our pants we are focused on commodities, foreign and stock indexes. ,we were incremental sellers in 2022. after having such a good year, i think other traders feel similarly. the currency get a little messy towards year-end. we have to see how the evolving fed story plays out, inflation risks and growth narrative lays out. an very concerned about

inflation, that the market reads too much into the inflation falling, but ignores the growth that could take it wall up in 2023. so we have to see -- that could take a wallop in 2023. one of the interesting things, we have people thinking we're going back to 3200, also people thinking we're going to a 4700 on the s&p. it's quite a big dispersion out there going into 2023. shery: which shows you, we don't know where we are headed, right? what about china, is that a bet you are willing to make going into 2023? stephen: i don't think you want to be late going into that party? there is enough signposts, enough progress being made there, and we have seen track records of other countries as they gradually reopen, their economies do pick up. we will keep tabs closely on vaccination rates, particularly among the elderly, but even more so, will they pick up to match neighboring countries question mark this is important for the

region. i think we get a decent vaccination rate, that will spur china to reopen again and it will be positive for regional sentiment. especially given how far the chinese equity markets dropped in 2022, i think there's a lot of bargains out there in the growth sectors. haidi: stephen, great to have you with us as always, stephen innes, managing partner at spi asset management. let's look at some of those early movers. annabelle: if you just look at some of the japanese car today, we are seeing some of them moving higherm including honda. looking a bit rangebound. take a look at the screen now, eight minutes into the session in tokyo and japan. there is a lot of movement that is happening off the covid restrictions in china. yes, officials are planning to pivot away from the harshest measures of covid zero, but still advocating for plans like

closed-loop systems. it seems carmakers instead of our choosing to suspend operations at some of their factories on the mainland, given the complexities of dealing with this system. so honda, yamaha and toyota are among those telling us that they have not been forced to suspend operations just yet. another stock that is looking at the start of trading is a chinese pharmaceutical company eisai. it is responding to reports that an alzheimer's drug it is developing with biogen could be to blame for two deaths that happened in one of its drug trials. this was down to bring bleeding. eisai has a statement out, basically saying that both cases had significant morbidities and risk factors allowing anticoagulation, and that contributed to the brain bleeding, which caused fatalities there. saying they are planning to fully disclose results of their drug trial on wednesday.

shery: let's now turn to vonnie quinn with the first word headlines. vonnie: thank you. a federal judge in washington convicted the leader of the right-wing oath keepers group of seditious conspiracy over the u.s. u.s. capitol riot of 2021. steward rhodes was found guilty of three charges well another defendant was found guilty of sedition. three other people were acquitted of that charge. it is a major win for the justice department, which has two upcoming trials involving the rarely used seditious conspiracy charge. bankrupt cryptocurrency lender blockfi will try to collect 600 meeting billion dollars owed by ftx -- $680 million owed by ftx's and amida. it is also developing a plan to repay creditors owed more than $1 billion, by reorganizing or finding a buyer. china has launched a rocket carrying three estimates to its newly completed space station. the spacecraft took off from northwest china tuesday night. stately dsa the s&ls spend the

next six months -- state media says the estimates will spend the next six month on projects in space. alibaba founder jack ma has reportedly been living in tokyo for the past six months. he has been keeping his public activities to a minimum while still perceiving business interests. the 58-year-old has kept a low profile since criticism of chinese authorities in 2020, preceded beijing's crackdown on tech firms. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. shery: still ahead, rising covid cases in china and uncertainty over opec's upcoming meeting is weighing on oil markets right now. jp morgan joins us later with their outlook. but first, china saying it will boost vaccination among its senior citizens, a crucial step on the path to easing covid zero. we have updates from beijing next. this is bloomberg. ♪

>> we have been recommending for sometime time now, a recalibration of china's zero covid policy. exactly because of the impact it

has brought on people and on the economy. it is tough on people. it is also negatively impacting the chinese economy through spillovers to the world economy. shery: imf managing director kristalina georgieva, speaking with the associated press. the fund said it might have to trim the forecast for china's economic growth, given not only property prices, but also covid restrictions. haidi: we are seeing officials adjusting their covid restrictions in the city that is home to apple's biggest factor in china. the order for local authorities to avoid excessive curbs when containing the virus. that following the protests over the weekend. we are joined by two guests. john, i will start with you.

when you look at the policy measures being tweaked in zhengzhou, is that an indication that beijing and as a result, local authorities, are taking it seriously in china, when it comes to minimizing at least the economic, if not the social impact of more widespread restrictions? john: the protests over the weekend really struck home how frustrated people are and how much is at stake for beijing and the government at large in terms of how covid zero is prosecuted. the change in zhengzhou is in line for what the central government has called for, in terms of having a broad, sweeping lockdown obesity, they are switching to a resume -- sweeping lockdown of a city, they are switching to a smaller lockdowns. it gives a larger swath of the population some reprieve. beijing for example yesterday announced that people at home

who are not needing to go out, for example, kids taking classes online because schools are closed, they don't have to do testing anymore. they were required to do testing for. so we are seeing steadily, day by day, some tweaking or rolling back of these measures. shery: we have covid cases for one city coming in over 7000, as we continue to get rising covid cases across the country. john, have heard more talk of potentially next meeting the most vulnerable, china's elderly. how crucial is this? john: it is crucial in terms of getting china to point where the leadership is comfortable opening. they want to see less deaths. there was a study by university in december that china could see more than one million deaths if they were to reopen like the united states has. a lot of those deaths unfortunately will be in the

order population, who are most vulnerable. those over 80 in china who have had a booster, three shots, is just under 40%, so they need to get that up if they want to reopen the economy. with the protests, we can see that many, many people want the economy reopen. haidi: chang shu, the reopening is key. how do you see the covid situation involving in terms of being able to sustain any kind of economic growth, when we are seeing so much trouble at the moment? chang: yes indeed, the covid policy is one key driver for growth, for now and for next year. very complex issues if the government opens up too quickly. that is positive for growth, but could come at a very big

health cost and trigger social concerns in a different way. but if the opening is too slow, the economic tool is going to be really heavy, and that will trigger more social dissatisfaction as well. so it is a very complex calculus that the government will have to do. our basic assumption in our projection for next year, is that the government will gradually ease the stringent containment measures sometime next year, possibly by the end of the second quarter, the country will pivot to fully open. under this assumption, we are seeing growth next year at 5.1%. we can also see some other drivers, important drivers, for example, stabilization of the property market. that could be something supportive to growth.

on the other hand, we can see the external factor, the external demand weakening. all in all, the situation is very challenging for growth in the coming year, and covid zero will be crucial. shery: and we are expecting a weakening of data in china's pmi numbers later today as well. so what more can we expect policymakers at this point? chang: in terms of policy orientation, the fiscal side, monetary side i think certainly the orientation was very supportive. we are not convinced how much more the government is going to do on the macro policy front tier, maybe the pboc can cut the policy rate by another 20 basis points. the fiscal policy was very supportive -- invest in infrastructure, et cetera. possibly the louise it a little

bit, depending on how -- possibly ease the policy a little bit depending on how the economy response to measures such as easing the covid zero policy and stabilization of the property market. i think they will retain some flexibility in their supportive policy measures. haidi: john, we spoke a bit about the protests. of course, things are quieter now after we saw the demonstration of the police and security apparatus across cities including shanghai and beijing. beijing has vowed to crackdown on hostile forces and their acts of "sabotage," according to the top body of the party in charge of law enforcement agencies. what do you see as being the strategy that they are taking to deal with these protests? john: i think the strategy here is caret and stick. we talked a lot about carrots, steps that the government has taken to tweak the policies,

loosen covid zero around the margins. and this is the -- this is the stick. the government saying, we will not tolerate protests forever. monday night into the night, we had colleagues going out on the streets to see if there were protesters again, there were not. there was instead a very heavy police presence, a reminder that the authorities are there and they're are going to take a firmer approach if these things continue. shery: john lewis beijing and chang shu in hong kong with the top stories in china. you can get a roundup of these headlines and things you need to know to get your day going. bloomberg subscribers can go to dayb , also available on mobile on the bloomberg anywhere app. this is bloomberg. ♪

shery: former new york fed president william dudley says he sees the central bank pausing rates at the 5.25% range to 5.5% range but they may need to hold at that level longer than markets are pricing in. >> the -- it will make it hard for the fed to stop if we are still at an unemployment rate before 4% and underlying inflation is 4% or higher. so i think we get a series of smaller rate hikes that nothing to push us up above 5%. clearly, the fed is stressing the longer rather than ever higher. if we get to 5.2545.5, they will relent and sit there and wait for that restrictive monetary policy to slow the economy down, generate more slack in the labor market, and that will push both which inflation and services price inflation down. >> this is what officials have

been saying, pretty much in line with they have been saying. the market is not buying it, they are still pricing in rate cuts by the end of next year. what does the fed have to see, to start becoming less restrictive, and i don't mean that in respect to keeping rates where they are. a mean lowering them in a significant way? >>? >> they have to be highly confident that they will achieve their 2% inflation objective. doesn't mean inflation has to be at 2% when they relent, but they have to be comfortable, that means they have to see a significant slack developing the labor market that brings down wage inflation to the 3% to 4% range, and they need to see the inflation pressures being much less persistent and broad as they are today. they need to see inflation in the 3% range and going down. once they have accomplished both of those things, then maybe they can start to relent. i think it's going to take some time, because the economy still has forward momentum.

it's going to be sustained by the past inflation have seen, for example, social security is getting in a .7% increase come january. -- getting an a .7% increase come january. they will spend that money and keep the economy moving along, and that will make it harder for the fed to restrain things. haidi: bloomberg opinion columnist and senior advisor bloomberg economics, elderly there. coming up next, a check on the crypto markets as blockfi tries to collect $1 billion owed by alameda. this is bloomberg. ♪ as a business owner, your bottom line is always top of mind. so start saving by switching to the mobile service designed for small business: comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network. with no line activation fees or term contracts. saving you up to 60% a year.

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shery: we have some australia data, the property sector, construction work boosted 2.2%,

better than expected in coming off the contraction of 3.8%, and building approvals coming through, a contraction of 6%, much worse than 2% in october, and extending losses from the previous month. taking a look at the cpi number. the consumer price index, the headline number at 6.7%, weaker than expectations, and also pulling back from seven .3% from september, trimmed -- 7.3%. that trimmed to mean, weaker than expected and weaker from the previous month, giving the rba more maneuvering space to slow the pace of what they do next. we've been talking about the fed to, the rba, seeming to have

more cushioning as one of the few central banks in the developed world that could avoid a recession next year. the latest data suggesting that perhaps, one person said the economy can orchestrate a soft landing. >> so important for economies trying to maneuver that outlook, right? let's get to vonnie quinn with the first word headlines. >> thank you. officials adjusting covid restrictions at an apple factory in china, lifting a lockdown. the shift comes after beijing reinforced in order for authorities to contain the virus . bloomberg has learned the biden administration may label the wegner group a foreign terrorist organization. the leader of the group is a top

supporter of vladimir putin and the war in ukraine. sources say the move would allow prosecution of the private military firms members. sources say argentina central bank expects to keep its key interest rate unchanged at 75% until next year. we are told that it is seeing slower prices and is prepared to hold. the estimate suggests monthly inflation could be 5.5%, down from 6.3% in october. wall street spending more on technology to watch traders. the industry will spend $1.8 billion on surveillance technology, an increase of 20% after regulators extracted record fines from the world's biggest banks. u.s. regulators reach settlements with a dozen banks totaling more than $2 billion. the usa has advanced to the next stage in the world football cup.

1-0. one player was taken to the hospital after crashing into a goalkeeper. the americans faced the netherlands on saturday. england advanced, defeating wales 3-0 and setting up a knockout meeting with senegal. global news 24 hours a day on air and on bloomberg quicktake powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. shery: still seeking answers into what happened with the collapse of ftx, sam bankman-fried speaking. he has been vocal on social media, but what more could we learn? >> yeah, so many unknowns in this. perhaps we could get some answers if sam bankman-fried goes through with the speaking a gauge meant wednesday. the summit is said to take place

wednesday afternoon. as you say, there are a lot of issues that need to be addressed , and certainly chief among those would be if how ftx wound up with such a shortfall, something sam bankman-fried has struggled to explain so far when he has taken part in interviews so far on social media, other media interviews. perhaps we can get more clarity when he speaks with a live audience. the other question is if tx or alameda research misuse customer funds, being investigated extensively bloomberg, and we know so far that these two companies had close relationships going back to their inception, and that ftx received customer funds to bank accounts held by alameda research about other issues including the biggest creditors being held secret, where the missing assets have gone, and

what exactly is next for sam bankman-fried? >> what are we seeing when it comes to the labor front when it comes to companies like ftx and blockfi? >> yesterday we started reporting that blockfi filing for bankruptcy monday. this is a crypto lender, a financial services company, and now we understand it is trying to recover some of the collateral it had taken up with loans, so it will be suing two companies linked to alameda research, revolving around robin hood's with doc because we know that sam bankman-fried took a 7.6% stake through one of these companies, emergent, in may. blockfi claims it needs these shares as collateral, but alameda research has declined to turn over the stock, reflecting

this broader fight in the crypto community, trying to de-tangled these complex trading relationships between crypto firms, but blockfi says it is a critical asset of its estate, when it filed for chapter 11 bankruptcy, and that alameda research on the flipside says that lateral shares of the property of owners and cannot be moved without a court order, but we will get some clarification or result in this, perhaps because blockfi says that hearing is intended to be for january. >> the latest. bloomberg terminal subscribers can use the function for the latest news and the prices of crypto assets. next, the head of asia research of j.p. morgan, parsley ong, and get her expectations for the

upcoming opec-plus meeting. this is bloomberg. ♪

>> oil prices holding on to gains in the asian session. wti around $79 a barrel. this as we head towards the opec-plus meeting where we could see that decision perhaps adding

more production or cutting back on production as well. oil has lost 9% this month. we watch gas prices. some pressure, but after we saw prices higher in the new york session, we had forecast for colder weather. it is actually pretty cold already, so i'm cranking up the heat. heidi: our next guest says china's covid policy and economic we can as -- weakness was a large contributor to the price. during is now is parsley ong. great to have you with us. difficult is it to make predictions about supply and demand next year with all of the ongoing uncertainty? parsley: for all involved, including ourselves, it is a volatile market and has been tricky to navigate this. >> how much of that tricking

this comes from uncertainty over covid zero in china? how big a part of that is your equation, versus the security issues in europe? parsley: for covid zero in china, the base case is a gradual reopening. from an oil demand perspective, we are modeling 500,000 barrels a day for 2023. the consensus is relatively cautious, with most of the recovery and jet fuel demand towards the later part of the year. if china accelerates the reopening, potentially we move to zero plus three early on in the year, international travel picks up obviously, and demand goes up. as of today, chinese jet fuel demand is still 500,000 barrels

per day below 2019 pre-covid levels, so if reopening is faster than expected, disposed and demand by 500,000 barrels per day. >> what is the base case and where does that put prices? parsley: the base case is gradual reopening, so 500,000 barrels per day. in a global context, in 2023, where looking at 1.3 millibars per day of global growth, and on the supply side, we have it outstripping demand, and therefore in 2023, we have $90, conservative oil price, but as transport fuel demand normalizes the we have balances tightening again, which supports $90 per barrel going into -- $98 per barrel going into 2024. >> what are you expecting on the

price cap for russian oil? parsley: it is a tricky time for both. we have two major upcoming dates, december 4 on the opec-plus meeting, in december 5 to win eu sanctions on russian oil kicks in, so if you look at what russia is doing today, russia is exporting about 3.5 million barrels of crude oil per day, one million barrels goes to the eu, and on december 5, regardless of what the price cap is, you will have to stop importing of one million barrels per day. what it allows for is for the rest of the players who by russian oil, if they subscribe to that price cap, didn't they can continue to use eu shipping insurance, etc., which contribute to the bulk of the market, so the discussions right

now are ongoing. there is a potential static price of $62 to $70 per barrel being debated. and, based on that, our base case is actually for no major disruption to russian supply, no major retaliatory measure, and actually we do see sufficient vessels available to transport, so if we combine russian and chinese vessels and indian vessels in the other fleet, we do think that it will be probably sufficient to move most of russian seaborne crude oil products to the fifth of december into 2023, and therefore we do not expect a big drop in russian production. we model in a 300,000 barrel per day drop in russian production,

and by middle of 2023 delete 2023, and by middle of 2023 close to prewar levels. >> how bullish our prices if this does not get done in the stricter sanctions regime has to come into play? parsley: you mean if the g7 price cap is not decided on, right? by the deadline? potentially, it would be potentially slightly positive to brent, so it depends on whether you believe there are enough vessels available, non-eu vessels available, to transport the russian barrels, so given our base case that there is roughly sufficient vessels, then we expect potentially 300,000 to

500,000 barrels per day disruption if that happens. >> good to have your insights into the energy space. we have more on covid cases. one region reporting 6995 new local covid cases for tuesday, at a time when we're seeing more conciliatory tones from health officials across china. we have heard of potentially easing in more targeted restrictions after we saw those protests across the country. we are just over half an hour away from trading in china and hong kong. let's bring in david ingles and singapore for a look ahead at markets. david, we are following that briefing from chinese health officials yesterday. anything that stood out? david: you mentioned it. really consolatory is a good way

of describing -- conciliatory is a good way of describing that. in terms of not just stating what i of the law and what the policy was, but what they didn't say and what came out out of the tone, recognition really that the public is frustrated and that they are frustrated, a recognition on the part of officials that they are frustrated because some of these controls are excessive, and the recognition of such simply underscores and reminds the markets that they were right. the markets were correct in their determination, the orientation in that direction, and that there is a need that is constantly adjusting and will need to continually adjust further given the realities in the economy, and where they are as far as vaccines. that being said, that will be a key theme in markets today in the next few weeks. november saw some really noticeable reversals,

statistically relevant reversals , i should know, in many of these key trades. the dollar dropped. you had the pivot. the reopening trade. many said this is the best month for chinese equities into decades or so, but we are still far from neutral, right? so it is how far do we see this go into investors look for an earnings pickup and economic recovery, which are still obviously months away at this current time. >> david, given how uneventful november has been so far, are there any angles you are particular focused on? david: i am tired. on two guys tired? you have been traveling all over the place. eventful is an understatement. we were working through a glance at what happens and how we make the sausage here, right? we were going through our xl file, coming up -- our file

coming up with these superlatives, and i got to route 20 or 30, then stopped, but to your point, what is not obvious here is you look at sector groups, csi 300, energy has stood out year to date. watch for any rotation between the winners, well, the winners into the losers as far as sector rotation is concerned, and we are watching closely today, the obviously, health care is a vexing makers, reopening, consumption, but brokers and focus as trading volumes have come back in a strong way, and if this really continues with volume that is a group that will rise. >> you and your excel sheets. pmi dated today? is that something you have in your excel sheet? david: no, because it is irrelevant today. i don't mean to trivialize it.

the data will remind us that, well, a reminder of why china needs to pivot. right? it will show, if the economies are correct, a drop from the previous month, sequential data, so it pays to compare that to october and september, so eight drop. in the same way, i will end with this, 10 minutes until the contract starts trading, and the same way the protests in the unrest of the we can are a reminder that china needs to head towards reopening in a safe manner, but if you want forecasts, 40%, 49%, but it does not matter. >> a preview of what to expect today out of china, and some of the stocks we should be watching as well as the market opens. asian apple suppliers could be moving after news that china is adjusting its covid restrictions

in one city. also, we are watching those vexing makers, because we are hearing that china is pushing to bolster vaccination among senior citizens. >> watching australian yields, after we saw that unexpected deceleration in consumer prices, really signaling price pressures may beginning to ease in response to the rapidfire rate increases from the rba, right, the sliding in yields, the headline number, still higher than what's the rba wants to see, but below forecast and welcome news for bond bulls., the three-year yield fell as much as nine basis points. equities flipping to an early loss, from an early loss to more of an upside pressure now. more to come here on "bloomberg daybreak: asia". this is bloomberg. ♪

>> japanese drugmaker has unveiled anticipated findings on its experiment to alzheimer's treatment, parking debate over whether the modest efficacy is worth the risk, including series brained bleeding. our guest joins us now. what do the results tell us?

>> so, these are positive results, the first unambiguously positive results from the stage of trials for this kind of alzheimer's drug, nuanced results as well, and the good people at eisai will take time to explain the report. it measures the levels of am alloyed protein in the brained, and how well the drug can reduce that. the second, how will the patients did on a score of cognitive decline, the ability to go about their daily lives. the third thing it was looking at was side effects that were definitely present. 1/5 of the people experiencing brained swelling or bleeding. in terms of getting rid of those proteins, the drug did well, but that modest improvement only in the cognitive testing scores of the patient's, that will be something that the regulators

and people in the medical field will be interpreting closely, are those risks worth what may be a modest benefit? >> what is the next step? in terms of being more broadly approved to treat alzheimer's? sophie: that's right. the food and drug administration in the u.s. has said they are looking at this for a fast-track approval and will need to make a decision sometime in january, and it could be march when they consider it for a full approval. there have been trials that show its efficacy, trials at an earlier stage, and that has looked promising, of the fda has been moving in that direction, but these other the details i need to pick apart, about the side effects, what happens with patients, with his many patients as they can get. interpreting the results will be tricky. for example, when these drugs have high rates of side effects, once someone starts expensing

the side effects of the date know they are taking the drug and not the placebo, so they are selection-biased. at this point, it's looking good for eisai. >> sophie with the latest. coming up next, rewards for investors allocating capital towards new themes, including transition technologies. we will be breaking down the numbers and the contraction november pmi and china. >> we are also hearing about expectations of backpedaling after the covid-zero policies. that is it for "bloomberg daybreak: asia". this is bloomberg. ♪

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