look at chinese stocks. the yuan jumping. a shift toward reopening the economy. shanghai easing some covid restrictions. oil on the way up with hopes of chinese demand. sam bankman-fried says he will testify before the house financial committee. we have a welter of news. aberdeen turning positive on china, and we've got the opec meeting taking place, opec-plus virtual meeting. keeping production the same, but oil prices on the way up on that reopening. let's not forget that blowout report that the cat amongst the pigeons. david: absolutely. following that jobs report on friday, it is a very sharp move

up in the u.s. dollar, and the reason i mention that is you would imagine that would be risk negative right now. since then, the dollar has started to move lower on the back of a lot of news. the jobs report, did it change anything as far as the fed is concerned? over the weekend, the news out of china, certainly shanghai and other cities. markets running with this. the hang seng index is up 31% msci china up 34% roughly speaking. the onshore and offshore rate are now back below seven for the first time since mid-september. for the most part the last few weeks, the weakness in the chinese currency has been dollar strength. does that flip? do we get more as far as yuan strength is concerned? against the basket, if you strip dollar strength, has hit multi-month lows. but as you can see, risk rally

continues this monday. rishaad: and if you look at volumes on the hang seng, talking about 155% of what you would get normally in terms of that. a lot of that money going into these companies that would benefit from a reopening. developers, casino stocks. jp morgan saying it is bullish on macau casinos next year. materials companies as well, up three quarters of 1%. that reopening basket, 4.2% up. don't forget the rally in november, up 30%, driven by airlines, casinos, restaurant operators. the gambit expected to benefit from the reopening. increasingly shifting bets to longer-term players, but nonetheless, people diving in and that's what we have right now. that should be reflected in earnings down the road.

david: certainly, we started to see that. just a caveat to the earning expectations, which has been pummeled this year. at about the same time news started trickling in, first speculation and then official news, that china was starting to adjust its policy at the margins. that's why earning expectations seem to have bottomed. we will see how long it takes back to the top. when you look at where valuations are, it seems like analysts were simply waiting for a trigger to start moving on this. since we are talking about earnings, china prophecy, second order effects, another example would be aussie mining stocks, which in november had the best month ever. you are not just seeing it in the onshore or offshore markets. the proxies are also starting to move alongside this, and it takes us into the commodities space. rishaad: certainly does.

looking at what is going on, we not only have the opec-plus meeting on the weekend, we have movement to the upside on the oil price, dictated by the china reopen. let's look at this chart. the eu reliance on oil. you can see the oil demand from europe has been curtailed. we've seen china take up some slack. also moscow being punished further for the ukrainian invasion, the eu and d7 approving a cap of $60 per barrel of russian oil. it is meant to penalize russia. we can see china talking -- we can see this impacting china also. speaking of which, we have a full house. let's kick things off with

sophia. aberdeen's boss is coming out and saying they're trying to get back into china. then you have morgan stanley bullish, and others. >> people are putting their money where their mouth is because we have this growing chorus of bullishness on chinese equities, but the market wasn't really moving. we are seeing that come into play. i would say the china reopening story is overtaking the fed as the biggest macro trade going into next year. that is really coming into play. we're talking about the biggest beneficiaries of china reopening and the proxies. everybody is excited. look at hang seng tech. it is up more than 5% today, this is a valuation story, valuations incredibly depressed. morgan stanley saying the equity risk premium people had attached to china, especially chinese stocks, that will be better

moving forward and they predict a multicourse of recovery. it doesn't take much to move the market. rishaad: you look at the hang seng, we were trading at 6.9 times earnings and now it is 7.1. is there a china discount built into the market? sofia: the china discount -- it was so wide. i think also, because there is a lot of kind of built in caution in the market, people are afraid of getting it wrong and being caught on the wrong side of this trade. i think the morgan stanley team put it really well in their notes, saying this will be a bumpy ride. you are going to get moves like today where everyone is kind of following the same trend. if you don't follow the market, you will get clients: using the market is up 20%, why are we in this trade? even if you don't believe the story or are cautious about reopening. but volatility being the name of the game, you will get days

where there is over optimism, infant disappointment when people come back to reality. rishaad: a new bull cycle, china rated overweight for the first time since 2021. huge upside, hasn't it? provided we don't have regulatory clouds again. also common prosperity takes center stage. sofia: we will see also the central economic work conference coming up, could be as soon as this week, where the politburo will set the economic agenda for next year. in march, we have the big meeting where the economic growth targets for next year will be set. we have a slew of important data points coming out, and really a chance for china's new leadership to set the agenda for really refocusing on the economy, bumping up that growth, getting consumption back up and running.

there is an expectation that the worst is over, but again, a lot of caution built in. there is the trauma of the past two years where people have been calling for a rebound and got burned on the wrong side of the trade. david: yeah, they've been wrong for two years, so they got to be right sometime -- i am kidding, of course. running with the reopening theme, oil. following a sharp decline, we are getting a week i think of sharp gains across the oil curve right now. let's bring in our correspondent. there is a short-term element and a longer-term element. let's start with the short-term. surely there is an upside. >> up as much as 26% or 70% -- 27% today. there's a lot of optimism around

china's recovery story. this is a story we've been waiting for for a couple of months if not a year. china has been very patchy. now we are seeing a lot of reopening -- beijing, shanghai, even some of the more industrial parts of china. that is fueling a lot of optimism in the market. as we mentioned earlier, today specifically, we are looking at eu sanctions kicking in. at the same time, looking at g7 price cap of $60. it is very hard to call right now, to make a call on what russia's exact oil exports will look like. there are a lot of factors. we need to see how the interplay with each other. as of right now, some of russia's oil, the majority of

russia's oil is below the $60 price cap. some of it trades above that. russia has said specifically they will not want to sell in line with this price cap, and they suggested they will punish people who participate in this price cap. we really have very little clarity as to exactly how russia's exports will look like it, even in the next couple of weeks and months. with all of those dynamics at play, the only thing we can focus on right now is china's -- confidence around china. and for now, an opec no change policy. david: so far that is enough, short-term, to drive prices higher. always going to ask if you could talk more about that. beyond the next few weeks, do we have any clarity really on how things look? serene: it gets trickier if you

look gone a few weeks. number one, we are seeing cold weather in places like china and across europe, temperatures are falling. on top of that, like i said, the uncertainty around russian exports. opec has also come out to say they will continue to closely monitor and they may make adjustments to their policies going forward. having said that, we cannot rule out the fact that there is still potential retaliation from russia going forward. in terms of their production, potential weaponization, in case things don't go their way. a lot of volatility as we go into the next few weeks. yeah, we have to wait and see. david: it is a time to pause and recharge.

thank you so much, serene. that is the energy market story. quickly, if the equity market is not careful, it might find itself in a bull market. msci asia, 17.5% up, 20% is a bull market. we are also above the 200 day moving average on this and mark, how long it might last and will that provide short-term support? we have to wait and see. we might be a few days away from an official bull market. su keenan has your first word news in new york. su: we start with the secretary of defense, lloyd austin says the u.s. is building a more lethal force posture in the indo pacific, part of efforts to make sure china does not dominate the region. he also says china is the only country with both the will and power to reshape the area. he also added the u.s. would sharpen its war fighting advantages and ulster its force presence.

china's financial markets meanwhile will pause for three minutes on tuesday as attribute to their former leader. the central bank and securities regulators said trading insecure these, futures, interbank bonds, money markets, foreign-exchange, and gold will all be suspended. they did not give a start time. the leader died last week and was party secretary from 1989 through 2002 when china's economy more than tripled. in south korea, a court has dismissed a request for an arrest warrant against the terraform labs co-founder. they said it is difficult to leave he poses a flight risk or that he would destroy evidence. he's looking allegations of fraud following the collapse of the tara luna stablecoin. the whereabouts of his co-founder are still unknown. and ill long -- bill hwang asked

a judge to toss out fraud charges against him. he says that there was deceitful conduct in the early days of his investigation. he says he was duped into assisting investigators who gave him false hope he would not be charged. he is scheduled to go on trial in october 2023 over the collapse. 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 su keenan. this is bloomberg. rishaad: coming up, ubs saying investors should avoid one-dimensional investing strategies. we will hear from their head of asia-pacific fixed income. first, expecting the u.s. economy to have a mild recession next year. ♪

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>> this report is a little disconcerting. >> a solid labor market. >> we still have a significant inflation problem. >> inflation prospects are still worrisome. >> the markets have gotten a little ahead of themselves. >> the market has not listened to the fed. >> they will not stop hiking rates just yet. >> is the level of rates restrictive enough? that is the debate. >> the fed has to get to restrictive levels and stay there for longer. >> i suspect they will guide us to about five. >> around five. >> five. >> mid five. >> five and a half. >> the fed can't stop until the labor market starts to slow down.

rishaad: just some of our guests reacting to the november jobs report. probably a bit of consternation at the federal reserve at those figures, and certainly it brings into balance where did they end up? five seems to be the consensus, but five what? david: yeah, and for how long? what is the hawkish risk to markets as markets continue to hope, and in a lot of ways they have been wrong. let's bring in our guest. pleasure to have you on the show. let's start with one of the things you mentioned, that the report means there is more work for the fed to do. imbalance may be increasing rather than decreasing. what do you mean? aditya: i think three figures

summarize the stable -- summarize the labor market. 272,000, almost 4 million in jobs added this year, compared to what powell says is up or even rate of 100,000 per month. lack of labor supply. the participation rate is down 1/10 from the previous month. if supply stops, the fed has to do more to tighten. third, 5.5% wage inflation, and acceleration from the previous month, assigned that the labor market is very hot and the fed has more to do. we have them going 50 basis points each in december and february and 25 basis points in march for a terminal rate of 5% to 5.25 percent.

david: let's look at your recession scenarios and the various iterations. does yours include a pickup in on them limit? aditya: absolutely. we have the unemployment rate rising to five point 5% by the first quarter of 2024. rishaad: give me a sense of base effects of inflation, when they start to kick in and how that changes the dynamic for the federal reserve and why you don't see inflation getting back down to 2% either next year? aditya: we have inflation coming down to 3% and that is partially because the base effects, powell talked about this. there are three components to core inflation. base effects are already decelerating significantly on a year-over-year basis. we should flatten out and maybe eventually start falling. we know that is most like going to happen. then you have housing inflation.

on a year-over-year basis, housing inflation will continue to increase through the middle of next year and then it will start dropping. but the key is housing. it is a labor-intensive part of the economy driven by wage inflation, and until the labor market slows down significantly, you are not going to be able to get inflation down on a sustainable basis, even if base effects don't have to be more favorable in goods than we are expecting. the only way to get there sustainably is to slow down the labor market. rishaad: but they seem unable to do that given the jobs report. if you exclude energy and shelter, these are things people spend money on ultimately. how useful is it to look at those numbers without the biggest components? aditya: absolutely.

in the u.s., food and energy are a smaller part of the basket than emerging economies, but they are expensive. powell says we look at core inflation because it gives us a better sense of where inflation is going, because food and energy inflation tends to be volatile and not really a function of fed policy. at the end of the day, what people experience in their deadline -- their daily lives is headline inflation. so stability is about headline inflation. not the core. rishaad: a final question -- david: a final question and i'm not sure how you took of the china reopening story as it pertains to the u.s., is there a transmission effect and does it bring inflation to the u.s. and complicate matters for the fed? aditya: i think there is basically three things to think about in terms of china reopening.

number one and i think the most important is the effect on commodity prices, particularly in the short-term, it is probably inflationary and makes the u.s. life harder. the second is what happens with supply chains, but we've seen significant improvements so there's probably not a lot more gains to be had fair. the third one is a u.s. exports to china. reopening will help on the margin but the u.s. doesn't export that much to china. on net in the near term, china's reopening makes the fed's life a little harder and probably makes the potential for a recession in the u.s. a little higher because the fed will have to hike more aggressively. rishaad: great having you on the program, thank you for joining us. we've got a lot more coming up, as we see markets in this part of the world heading north. this is bloomberg. ♪

rishaad: you are back with bloomberg markets. we've got reports that the saudi arabian crown prince is preparing to invest in credit suisse. mbs may invest as much as $5 million in the lender, other investors could include bob diamond's business. apple has fully resumed advertising on twitter my de-escalating a growing war between the companies. muska made commentary over the weekend, adding that apple is the largest advertiser on the social media network. david: property shares are in focus and also dollar bonds, i guess on the back of policy support, reopening.

wynn macau. no room for bearishness, unequivocally talking about bullishness. the samsung ceo retaining his spot after a shuffle. really, when you look broadly, this is an up story this monday, especially the chinese markets. the msci asia-p millions have made the switch from the big three to the best kept secret in wireless: xfinity mobile. that means millions are saving hundreds a year with the fastest mobile service. and now, introducing, the best price for two lines of unlimited. just $30 per line. there are millions of happy campers out there. and this is the perfect time to join them... add a line to your existing plan, or see for yourself how easy it is to save by talking to our helpful switch squad at your local xfinity store today.

>> we need to signal to the public, to the observers, to the commentators, that in all scenarios, inflation will return to our medium-term target in a timely manner. >> i think what we've got to do is keep the focus on medium-term

outcomes, and we are going to deliver an average inflation rate of 2% or 2.5% over time. >> next year, the inflation forecast for china is in the moderate range. >> 3.3% last month, this month is above 3.1%. >> the biggest risk is where it comes from. rishaad: several governors there on fighting inflation. starting off with the question of the day -- how far can this treasury rally go? yields, 4.24% toward the end of october, yielding 3.5 2%, that

shows you how far the rally has gone. are we done? you look at the jobs report and you think, surely -- but pricing is different >> the yield curve is inverted right now so about 79 basis points, whether you look from the front end to the twos to tens, deeply inverted. the fed is once again overdoing it by hiking. but when you look at the jobs report, you could probably say they continue hiking. if you get into the wages number on a three-month by three month basis, it's up about 8.5%, so really strong wage growth going on but maybe job openings are starting to slow down. or maybe they start to slide. rishaad: there was household report in that, adding some support to your thesis. you look at what they are doing, a strong labor market, high

inflation, perhaps coming off a little bit. have you ever known not to be a case in a developed market? hayden: all the forward-looking indicators are telling us activity globally is slowing down. that tends to have less of a reaction on the u.s. upfront, it seems to be more back and. -- backended. those firms like apple talking taking jobs back. i think the risk is the u.s. is going to get dragged down with what is happening in europe. at the moment, asia is still going really slow. we are waiting for the china reopening but that's probably not until at least second quarter of next year. rishaad: we are still seeing the effect of it on the markets and what they are pricing in. i think they might be getting ahead of themselves. hayden: we've been running ahead of ourselves all year in asia, particular china, with the uptick in the market. we've got central bank governors

, banks, lending into the markets, although supportive measures we've been looking for across china in particular in place now. coming into next year, i think we will get a pickup, where in for structure can start to happen. we get sales on the property side as well. david: how would you trade the 10 year in china, which is now pushing back toward highs? it is backed up because of the reopening plan, wondering how much further you think that will go, if at all. hayden: the trade of 2022 was to be short the u.s. and long china, and now you want to flip that into reverse. we think the 10 years in china can get toward 3% as its first stopping point, and i think you want to be long in the u.s.. you have different trends in

place, a reversal to last year. makes sense because china is countercyclical with the rest of the world. this time it has just been a little slower. david: a follow-up question, as they reopen, i would imagine the risk premium fades ever so slightly and it might open up more options in the fixed income space and china for investors that probably don't have a lot of risk appetite. any options not on the table for those investors? hayden: property at the moment is the one on an absolute tear. if you look at property last month, we are up about 123 percent, that's in fixed income. still down around just under 50% year-to-date, so a lot further to rally in that part. we are seeing support measures from the banking sector, but what we haven't seen is the sales activity pick up, so that

has time to run. i think it's about short rates, also great diversification characteristics. you probably also have another 150 or 200 basis points pickup to the u.s.. fantastic carrie coming through. david: what about for income, and let's abroad in it for the region. where you think income investors should look right now? hayden: asia is behaving very differently to the rest of the world. if we look at the inflation block, it is between two to seven, the rest of the world is five to 10, or emerging markets, 5 to 5000. we've been cutting tariffs all year in asia. think it has a dampening effect on inflation, oughts of stability, you look at

indonesia, india, and even korea at this point has done in its hiking cycle and you can start to lay back into the bond markets. we like australia in that context as well. we think they are getting closer and closer to the end of their final hikes. rishaad: dollar or local currency denominated? hayden: i think the dollar is the key to everything. rishaad: i think you are finding yourself in the minority gradually. hayden: i think at the moment the contrary and trade is to be long dollar again. we've had a nice pullback and cleaned out the long dollar positions we've been in all year and we can see the u.s. dollar go up again. we will get further heights and if we go into recession, which the yield curve is predicting, i want to be long the u.s. dollar when the rest of the world is suffering. rishaad: you are going with dollar-denominated debt. how about some of those companies, do they present an

opportunity for high-yield? hayden: i think it will be ig, short dated ig in the one to five year part of the yield curve. ig at the moment and high-yield when we see the eyes of the recession. rishaad: staring down on you. thank you, hayden. and of course, shorter duration. one of the top stories, what is going on with lockdowns in china , and perhaps relaxation in many places. here is the first word news with su keenan. su: chinese authorities have accelerated a shift toward opening the economy. shanghai and other cities easing some covid restrictions after protests against the nations astringent policies last week. shanghai will scrap pcr testing requirements to enter outdoor public venues.

elsewhere, the home of alibaba, testing requirements for entry into most public venues will also be dropped. opec-plus is keeping its oil output unchanged as it takes stock of the market roiled by uncertainty over chinese demand and russian supply. the group held a roughly 20 minute online meeting on sunday. a decision is expected to hold for a few months until its monitoring committee meets again in february. south korea's president has asked his cabinet to prepare a return work order, this on striking truck drivers in the oil and steel industries. this as damage has been increasing with $2.3 billion worth of products and other sectors unable to be transported as of saturday. workers have unsettled wage demands after month of negotiations. evergrande's offshore creditors

are said to have signed confidentiality agreements as they seek to advance debt negotiations with the chinese developer. sources tell us talks were beginning over the weekend. evergrande is ending to present a restructuring proposal for its dollar debt as soon as this week and also hoping to get support for the plan from offshore creditors in february. 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 su keenan. this is bloomberg. rishaad: thank you. let's look at the world of crypto. dominated by what happened with ftx and sam bankman-fried says he will testify before the u.s. house after he finishes investigating what happened with that company. annabelle droulers is tracking this. what is the latest? annabelle: we know there are a series of congressional hearings taking place and the next one scheduled is for tuesday week,

that will be in the house, and the focus is to investigate what went wrong and the collapse of ftx. ahead of that, we heard from a number of financial services committee members, they've been on twitter, basically calling on sam bankman-fried to participate in this event. one is the committee chair, maxine waters, she said if sam bankman-fried could attend, it would be helpful to ftx customers, investors and others in the industry. she wants his participation on the 13th of december. a few hours ago, we had sam bankman-fried, he gave an rsvp sort of. he said he will appear before the house and he thinks it is his duty to do so. that he is not committing to december 13 because he is saying he needs to conduct his own investigations first. rishaad: due diligence. where are we with any investigation into this and what kind of legislation are we looking at as recourse? annabelle: we know it is a

divided congress, that makes it difficult to get anything through. coming into the year end, there seems to be a bipartisan push to get something to happen. we heard from the senate banking committee chair, sherrod brown, he was on cnn on sunday saying he and his colleagues are trying to do this every day. we also heard from the other side of the political spectrum, senator pat toomey spoke with bloomberg and said he is one of the people that bought the hype and the mania around ftx, and he is saying there is a chance they could get something passed before the end of the year. it will not be a broad, sweeping regulatory push, it could be attached to a spending bill. regulatory, and tax exception for crypto transactions under $50, and that means they could be used for small purchases. david: this still makes my head spin if i am honest. we haven't even talked about ftx

and the cleanup ongoing. one of its units possibly -- and who would buy it? annabelle: actually, a few people could be interested. ledgerx, the derivative arms of ftx, the only business unit of ftx also regulated by the cftc. that was the cornerstone of sam bankman-fried's efforts and washington. we are hearing it could be up for sale. it is one of the few solvent pieces left in the collapse of the ftx empire. 10 businesses could be interested. some big investors as well. more around the valuation. that is still unclear. we know as of november 17, they had $303 million in cash on hand, and we are told that some of the parties interested are

interested enough to sign ndas. david: annabelle droulers, our crypto queen. just ahead, a look at the real estate market across the region with a special focus on china. also singapore, warehousing demand is sending prices skyrocketing. the opposite and onshore markets. full analysis from our guys. this is bloomberg. ♪

rishaad: approaching the top of the hour, let's look at what we have with regards to our outlets. just a few weeks left in 2022. looking at what is in store for next year for these different industry groups. we are looking at the first one monday, real estate day. david: we are starting things from the ground up, as they say. ok. property, let's look at china, why not? that has been the big story. 14 straight months of month on

month contraction in the market so it sets you up into what will hopefully be a recovery next year. the long road ahead as far as fundamentals are concerned. it goes into what the markets do, they tend to look ahead, and when you look at the high-yield index and our own measure of that, we see markets start to buy a nibble, as they say. from a yield of about 30% on the china bond gauge, we are down ever so slightly, up four straight weeks after what has been almost success of weeks of losses. we will have to see whether markets are sniffing out good deals. rishaad: could this industry group really consolidate in 2023? bloomberg intelligence suggests they may well do. we have some builders that continue to struggle to survive, we have our senior industry analyst. patrick, we see a gradual i suppose easing in these restrictions.

i'm not sure if it is good for the property market looking ahead. patrick: the situation is we have the opening on covid, that will be a positive for the overall property market. home prices keep coming down quite a bit. affecting the home sale sentiment the next couple of months i think. but hopefully sometime next year, middle of next year, we will see positive things. in terms of sales momentum, it was really bad last year. rishaad: the thing is, developers may find it easier because they've been allowed to raise money from various channels such as bank loans, bonds and equities. this is part of the latest china plan. the thing is, they got to try to

relieve their cash flow and that is part of it. will they be able to do that? patrick: i think they focus on those. it is possible to still get the funding. for those in distress it is still challenging, like evergrande. it is challenging. but we see more m&a going forward in the next few months. they are doing better in terms of getting funding. rishaad: highest level i think for more than a decade here. that's got to hurt, people who have borrowed and want to borrow in hong kong. patrick: exactly.

[inaudible] i think the u.s. is slowing down a bit in terms of rates. [inaudible] it is also affecting hong kong. for the home market, prices are down 15% year-to-date. it is very challenging for sales. rishaad: patrick, thank you very much. patrick wong talking about the prospects of the property market in china and hong kong. let's look at these business flash headlines. the nissan chief executive headed to france with -- for more chance with renault. there will be a meeting with the seat oh. they will try to reboot a partnership that's been problematic over the years. let's move to ftx and one of its

few solvent divisions said to be up for sale. it is attracting interest from potential buyers. sources tell us at least 10 firms have expressed interest in ledgerx. it is considered one of the most valuable assets associated with ftx. buybit planning to slash its workforce. the chief executive saying as part of an ongoing reorganization and the priority is to ensure business relationships are unaffected. it's the latest in a string of exchanges to announce job cuts. let's turn to the initial public offering of saudi aramco's refining unit was covered within hours of the company being exposed to shares. as much as $1.3 billion for a private equity firm.

ipo's in the gulf region have raised almost $20 billion so far this year. that's a look at our business flash headlines. more on the way. this is bloomberg. ♪ get refunds.com powered by innovation refunds can help your business get a payroll tax refund, even if you got ppp and it only takes eight minutes to qualify.

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rishaad: you are back with bloomberg markets. we've got h shares are trading in hong kong, providing a big lift for the hang seng as it puts on 3.5% extending the rally from november. up about 3.8% in the first trading days of this month so far. a lot to look forward to, particularly the u.s. in focus. ppi, initial jobless claims on top of that, on the back of what we saw with the report that was a blowout number. also before the fed we get u.s. cpi, at the moment 7.7%. that's a look at the u.s. also rate decisions across the board. david: i think rba, i singled that one outcome as we push toward the end of tightening

cycles, rba was the first one as far as the g10 was concerned, to flag smaller hikes. that decision will be in focus. that is tuesday. what goes into what markets are running with today. it's not just the china story, the reopening store is almost a given as far as low hanging fruit. there is the property story. casinos are up 9%. i just emphasize they are coming off an extremely low base for many of these sectors. 9%, only 90% and it gets us back to the top. this could be a 2024 story. we are pushing on a 200 day moving average on the shanghai composite, only the first time i believe since the summer. whether we break above that is another thing. momentum is on the side of the market.

it's also pushing the benchmark in asia, very close to entering a bull market. rishaad: reopening is key. you talk about they've got the currency also, appreciating, breaking through the seven level. that is at the moment something to take note of as well. strongest i think since mid-september or thereabouts. that gives you a sense of the confidence being built up as to what china will be able to do and how it reopens gradually here as well. how much of this is already priced in is a big part of this. we have a lot more right here in the next hour on number of markets. ♪

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rishaad: almost 11:00 in the morning in hong kong and this is bloomberg markets.

i am rishaad salamat. we have got chinese stocks surging with the currencies reaching key levels as they currently move towards reopening. investors are beating that pivot away from covid zero, easing restrictions in shanghai and hangzhou. oil gains also with hopes of increased chinese demand is opec+ keeps output steady and that happens while sanctions on russia kick in. some positivity equity wise. we are turning bullish on china and also aberdeen, just the latest set of investment banks which sees china as being more investable than they were a few days ago. annabelle, that is being reflected right now given what is happening on the ground. annabelle: the full effects of reopening may not yet have been priced in, but as you say, this is risk on trading in the session and it is an interesting one given a couple of hours ago we were looking more cautious because there was the fed story too.

we had that strong u.s. jobs report on friday and that told traders to expect the fed to keep hiking rates for longer, but the china story is winning nine minutes into the trading session, particularly in the equities space. the hang seng is claiming today led by the tech and property stocks, also the csi 300 up 1.6%. you spoke about what investors are seeing but also economists starting to recalibrate their expectations and goldman sachs also has a note out saying that if china sticks with their baseline scenario of a reopening in the second quarter of next year, they are expecting real terms to be .5% in 2023. particularly what we are scenes in the chinese yuan, it is below 710 for the first time since september. if you take a look at what we are seeing with the function, at the start of the day, it was more risk off. only a handful of sectors were

in the green. that was the energy and the material sectors, but you can see now looking a lot more broad-based. rishaad: it is a reopening story around these reopening -- second-round effects. this just shows how people are seeing more confidence in china. let's get to what is going on on the ground. stephen engle is here. as well as sofia horta e costa. what do we know about the situation and the likes of one so, sean hannity -- guangzhou, shanghai, and beijing? stephen: it is happening step-by-step and we are starting to see the testing kiosks being pulled off the streets of china. people needed to take pcr tests

to go to public venues and the like. these are starting to disappear so we have entered a new phase. the outgoing vice premier who is in charge of covid response essentially said last week that we are into a new phase and admitting that omicron is less lethal, it is weaker than previous variants. this is giving the government the excuse to do what the rest of the world has already done. rishaad: i'm curious about the protests we were witnessing at this time last week. that has definitely done something. stephen: i do not want to say the protests spooked the government, but i will say it. it just accelerated the reopening up process we are seeing. xi jinping met last week with charles michel and official set at that meeting, if confirmed, xi essentially said the variant

is weaker, so there is room to open. again, if that is confirmed, that is the first time the top man has acknowledged there is room for opening. shanghai and hangzhou are the latest, but one so -- guangzhou, harbin, urumqi, a number of cities already relaxing testing. rishaad: what is the opposite of being spooked? is it emboldened? the markets certainly took it as well. sofia: and if we are talking about excuses to looser restrictions, the market is getting excuses to buy. this is the story of what is happening in cmarket, the valuae incredibly low, you need something to change. the shift in narrative, the rhetoric around covid zero, that was really what involved it,

allowed people to make that big macro trade going into next year, which is the china reopening trade. there is also so much room for the market to recover that we are seeing this today and they talked about this earlier on the show that it does not matter essentially which industry you are buying. you have morgan stanley saying you should buy consumer stocks because consumption is going to improve, or the property index because -- rishaad: you can look at a house now. sofia: it does not matter what do you buy. everything was so depressed. you're seeing the rotation into hang seng tech, which is not a reopening play at all, so it is your excuse to go back into the market. i would say there is a disconnect between what we are hearing on the ground, and steven, you can talk more about this. there are still restrictions in the market gets ahead of itself, but the market has to price this in before it happens because the moment it happens, it is too

late. stephen: the problem is we have had false starts in the past. you have to see where the winds are going and where the narrative is going. the narrative right now is is in the positive direction. we still have a few months until the national people's congress, we still have a few months of winter. the flu season is strong and it is perhaps going to be strong in china and covid is potentially going to be strong. they have had 30,000 cases yesterday reported nationwide, not the nearly 40,000 later in november, but still. rishaad: what has china learned from one taiwan opened up and hong kong opened up? where going to get a surge in cases. stephen: we are going to get a surge, but the weakness of the variant, it is less lethal, that could be the narrative going

forward. again, i think it is the economy that is the driving force because you have the six economists, they are saying that if the politburo's meeting this week, the beginning part of december, the agenda for the national people's congress in march, they need to prioritize the economy and loosening the restrictions of covid zero even further. sofia: that stop and start reopening, if you are looking at what we had in hong kong, that was the omicron wave. we know -- rishaad: you could get out but you couldn't get back in. sofia: it was problematic for the hospital system and hong kong has a very advanced hospital system. on the mainland, we could suddenly be seeing debts and we do not know -- deaths and we do

not know how that will play out. on the markets side, volatility is the name of the game. morgan stanley has a wide range for their index targets. this could go very well for the market, this could go extreme value, but the only certainty you have is that it will be bumpy. stephen: we will see. the efficacy of the chinese vaccines will come into play as well the next few months and if they get enough of the elderly there were hong kong failed miserably to get the orderly vaccinated, and they have several mrna vaccines here that they do not have in china, so we will have to see. rishaad: we will have to see. we have got to the bottom of it, didn't we? thank you. sofia horta e costa and stephen engle. we moved to new york as su keenan has the first word news. >> we start with china's

financial markets which will pause three minutes on tuesday as a tribute to former leader jiang zemin. the central bank and securities leaders said that trading in securities, futures, foreign exchange, will all be suspended. they did not yet give a time. jiang, who died last week, was party secretary from 1989 to 2002, where china's economy more than tripled. opec+ is keeping its oil output unchanged. this is to keep stock of a market that is on royal -- that is roiled by uncertainty. the group held a roughly 20 minute meeting on sunday. the decision is expected to hold for a few months until its monitoring committee meets again in february. to south korea. the president has asked his cabinet to prepare a return to work order on striking truck workers in the oil and steel

industry. this comes with $3.3 billion worth of oil, petrochemicals, and steel, unable to be transported as of saturday. truckers had unsettled wage bands after months of negotiations. bill hwang asked a u.s. judge to toss out fraud charges against him. he has engaged in what has been called deceitful conduct since the early days of the investigation. he says he was duped into believing investigators that gave him false hope that he would not be charged. he is scheduled to go on trial in october of 2023 before the collapse of archegos. global news, 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am su keenan. this is bloomberg. rishaad: thank you. still to come, we look at india.

the central bank is gearing down the pace of its monetary policy tightening. elara securities'garima kapoor will give us the latest strategy on the hike. but first selena ling says there is enough room for cautious optimism. find out why. ♪

>> either they can save the economy or they can save their populations near perfect health, but i do not think they can do both. >> test not prepared people -- it has not prepared people for reopening. people need to get those vaccination rates among the elderly much higher than they are now and increase the

capacity of hospitals to deal with what may be a coming surge. >> we are not sure that the government will continue to be so tolerant in the face of rising cases in the first quarter if there is a deterioration in parameters. rishaad: a few of our guests on bloomberg looking at china's covid policy shift. to discuss all of that and what has been going on in the u.s., selena ling, head of treasury research at ocbc bank. we had a guest earlier saying that we are moving away from the fed announced talking about the china reopening, and that will be critical. even jay powell alluded to that in the speech you made last week. selena: definitely. mostly you come down to the big factors, one which is that the fed will posits rate hike story.

the second is when china will relax and reopen the economy. we are taking baby steps in the right direction so as long as we expect that china continues to gradually relax, a full relaxation is anticipated in the second half of next year. generally moving in the right direction. we have to recognize that coming into the year end, we will -- we have been bearish against china, so this is a place for risk and i see this as more of a technical bounce. as we get signals that china is continuing to open up, that should be supported in the short-term. rishaad: how attractive is chinese debt? selena: we are also fairly cautious on chinese debt. we have optimism on the view. i think it will not solve all of the problems overnight. we have seen from the chinese property market in terms of the relaxation of the property

matters, that means it'll put a floor to the chinese property market. by no means are we expecting a huge bounceback in terms of demand. going ahead, we expect this will be a story of two steps forward, one step back. as long as it is not a backwards rhetoric, that will be generally kind to growth for the chinese economy next year. we are looking at a 3% handle for china this year. we could expect to see growth together with the reopening coming together to pull them closer to 5%. rishaad: tenant is responsible for exporting disinflation in the past -- china is responsible for exporting disinflation in the past. is there a reason why this would be your thesis on base effects? how does this play into the recession narrative too?

selena: if you look at the recent inflation print, it is starting to suggest it could be dovish. it is starting to stabilize a bit in the u.s. if you look in terms of commodity prices, borrowing fresh shocks to the commodity markets, oil prices are holding well in the current nature right now. assuming we do not get a huge growth surge in china despite the reopening, that should mean that the base effects will work in our favor. i also expect inflation prints globally should taper off a bit. by no means will it return to pre-covid levels, but it will ensure that the central banks' quantitative tightening, that is starting to take effect and this is working. then we can start to taper the pace and consider when the

endgame is. in terms of the situation, it is coming up from the high levels we have seen. it is not outright deflation, meaning i am not expecting any changes of prints at any stage. it would depend on how much the chinese economy comes back. when china reopens, chinese demand could contribute a little bit too boosting inflation across the region. rishaad: that brings us to the question of the day. we have seen yields come off 2.4% towards the end of october, and those are following the 10 year treasury at 3.5%. how long can this bond rally continue? that is the question of the day here. selena: i would suspect it is a little overdone. i am concerned it is running ahead of itself. members in the run-up to the last fomc meeting, there were a lot of hopes that the fed would be pivoting soon.

it is clear they are not really pivoting. by no means are they signaling that they are anywhere near a pause. i think that will start to come into play for the first quarter of next year depending on how the rhetoric goes and how the dot plot comes out. the next fomc meeting in mid-december, i suspect they will continue with the caliber of the story that is a slowdown in terms of pace, but the terminal rate will be higher than what the markets are currently pricing in. the markets are looking for the rates to go back down to 4.5% by the end of 2023. it is a little hopeful that the fed would cut that much. rishaad: where are you in singapore right now? selena: in terms of growth, we have had nice growth this year.

i am looking for some slowdown in growth across the asian economies. one is that many factoring has faltered especially on the electronics front. we are expecting some manufacturing weakness to drag onto the first quarter of next year. on top of that, the commodity bonds that we have seen that benefit exporters like indonesia, they are expecting that bull run to stay off, so not giving much of a lift in terms of growth or for some of these economies like indonesia. we expect it will be a return to slightly more normalized growth. singapore's case, because we are an open economy and we are not immune to the slowdown story that is across the regional economies like the u.s. and the recession stories in the euro zone and the u.k., we are seeing a dramatic slowdown in terms of

our industrial production and also in terms of our numbers. the offset of that is the services sector because of tourism coming back. but we can expect a slowdown in global momentum. rishaad: always a pleasure. thank you for joining us. selena ling from ocbc bank. the hs tech index is up right now, up 7% plus. the market -- this is the highest level we have seen for this index since the beginning of this september, the first of september to be precise. the current streak of gains is for this index, it lasted five days. that is a look at one stop down for the novo group, but look at the rest, hoping to lift the hang seng as well.

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rishaad: we are looking now at credit suisse. ask lehman saying that they still believe in the embattled financial institution. bloomberg talked to him and he told us exclusively about how the outflows have stopped now. >> of course that is never easy. we have quite a lot, some roughly 10 key investors. there are longtime investors. they welcome our plan to transform the company. they have a high belief in the credibility of the new management team, so they are

standing by, but they are somewhat impatient. they want to see the change, they want to see us executing, and that is what we are doing. >> what was the feedback like? if i a with all of the uncertainties around credit suisse? >> the feedback is astonishing. the clients still like us. we have very few clients leaving. they might have in light of those news withdraw some money from us, but i am confident. i have a lot of personal discussions with clients, i know from regional management that the money, when we do well, will come back. francine: when do you think the outflows will stop? >> they basically have already stopped. we saw two or three weeks in october, a sustained flattening out. they are gradually coming back particularly in switzerland. rishaad: axel lehmann talking with our very own francine lacqua.

we have got the hang seng tech index up words of -- upwards of those levels we have not seen since september. annabelle droulers is with us. five days of gains in a row. annabelle: this is a story of reopening today. we are seeing further relaxation of covid zero curbs for some of china's biggest cities. it is a story around that tech space. you can see the likes of bilibili climbing the most since march. let's change it on and take a look at how the casino sector is faring because we had an incredible lookout from j.p. morgan. they are saying in the bear case scenario, stocks are still going to rise 30%. the upside is a 100% gain for some of these risks.

let's also look at other sectors that are faring well because we are seeing that across asset classes, including chinese property bonds. and you are seeing this picture for the biggest property developers in stocks. there are also second-order effects including what we see in australia. these names are leading the asx 200. rishaad: thank you for looking out. we will discuss the oil markets amid the reopening shift in china and opec's move to keep output study. we have got sanctions of russian oil also being instituted. all of that and more on th

rishaad: 11:29 right there in shanghai. we look at the shanghai comp up 1.5%. a reopening and a loosening of covid restrictions playing into the steam which annabelle is looking at as we head into the

china lunch break. annabelle: it is all about the reopening in china today looking at more cities using their covid rescissions -- restrictions. these gains across the board and abroad spectrum. let's also change it up because the boost in china is boosting the regional benchmark. we have the msci asia-pacific on track for its best day in all of this, and we are approaching a technical bull market. we are looking at the 200 day moving average. also moves across the energy complex. this is not just a story on covid with the reopening story in china but also other factors playing including those moves from opec+ over pec+ over the w. and you also have that eu price cap as well. rishaad: let's look at some of the reasons why we are seeing that. let's get to our oil markets reporter. have got the russian crude cap.

have we got this done or not? $60 a barrel has been touted and will we get a firm agreement? >> finally we got a firm agreement. we have the price cap of russian crude exports at $60 a barrel. like you said, there is a lot of doubts and questions because more than half of the russian crude exports are being sold below $60 a barrel already. but there are some barrels from the russia far east that is picked up by a lot of asian buyers that are sold about $60 a barrel. the question comes down to whether these buyers will be able to push and negotiate their price going forward. we have to remember that the price cap, if you try to buy the crude oil above $60 a barrel, you will not be able to get european shipping services. greece, which is part of the eu,

is -- they have very big tinker fleets. there will be a lot of chaos in terms of logistics. there is some doubt at the moment. rishaad: we also had that meeting over the weekend of opec+, not changing their output production, but they were already seeing more than their quotas, weren't they? sharon: that is right. opec+ did come to a decision to cut 2 billion barrels a day from november, but we have seen that they have cut their production by about one million barrels a day. it is definitely less than what they have pledged. they are going to be holding their production from january, which is next month. that is because there is a lot of market uncertainty at the moment. we have the russian price cap as well as the eu sanctions on russian crude exports coming into effect from today. i think they want to wait it out

a bit, wait and see how the market will react because prices have been volatile. it is more of a wait and see at the moment. rishaad: it certainly is and we look at how also the eu has been reducing its dependence on china will -- sorry, on russian oil, and china has been taking some of that slack. perhaps we will see the indians likewise do the same thing here. sharon: yes, indians have been buying a lot of russian crude and it is a big question whether china and india will stick to the $60 a barrel russian price cap and whether they will keep continuing to buy this large amount of russian oil. because the european union, the members are definitely not going to buy whether there is a price cap or not. these two countries, their purchases, everybody is watching them at the moment. rishaad: thank you very much.

sharon cho there. let's get the first word news headlines with soon keenan -- su keenan. su: chinese authorities have accelerated a shift towards reopening the economy. shanghai and hangzhou are easing some covid restrictions after protests against the nation's transient policies last week. shanghai will scrap pcr testing requirements to enter outdoor public venues. meanwhile, hangzhou, home to tech giant alibaba, testing requirements for vent -- entry at most public venues will also be dropped. the u.s. is building a more lethal force posture is in the indo pacific. this is part of efforts to make sure china does not dominate the region. austin says china is the only country that has the will and the power to reshape the area.

evergrande's offshore creditors are said to have signed confidentiality agreements as they seek to advance that negotiations with the chinese developer. sources tell us that talks began over the weekend. evergrande is trying to present a restructuring of its dollar debt as soon as this week and is hoping to get some support for the plan from creditors in february. to south korea. the court has rejected a protest from shin's arrest warrant. he is facing allegations of fraud after the collapse of the terra luna stablecoin. his cofounder's fate is still unknown. global news, 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am su keenan.

this is bloomberg. rishaad: thank you. we quickly check in on what is a rising tide lifting all of the boats, including commodities. iron ore is up, these industrial metals all the way up because of bets about china using its strict virus curbs and how that will play into demand recovery. according to many, we should gather momentum into next year. we look at what else is happening because it if -- it is ftx and crypto. sam bankman-fried says he will testify before the u.s. officials after an investigation is complete. annabelle: there is going to be a series of hearings in congress taking place across several months. already had the one in front of the senate last week, and we have the one for the house scheduled for next week.

they are asking sam bankman-fried's in a public manner to appear before them. one of them is the committee chair, and she basically went on twitter a few days ago and said if he could appear, it would be a big help not only to customers but to investors and others in the industry. with that in mind, sam bankman-fried spotted to that tweet a few hours ago and he said that he is willing to testify, but there is a big caveat, and that is around the date of one he is prepared to testify. he is saying that he wants first to finish reviewing what happens and once that is done, he will appear before the house. rishaad: we can go through all of the ins and outs before any legislation can be arrived at. what is the deal with that? annabelle: a lot of people understand that given congress is divided, the chance of

passing legislation is more complicated given that, but it is certainly a bipartisan push now and there is a lot of anger around what has happened with ftx given more than one million customers have been impacted. we have heard recently from the senate banking committee chair saying that him and his colleagues have been trying every day to get something passed. and we heard from the other side of the aisle, because senator pat toomey, he told us in a bloomberg interview that he also pointed to the mania around sam bankman-fried but he now thinks there is a small window of getting something done before the end of the year. it is basically going to be something attached to a spending bill and will get new measures around stablecoins, clarity around the definition of a crypto broker. rishaad: this is quite convoluted.

he called it delusional, i believe. annabelle: he called back to the comments. rishaad: what are we having -- is he walking back all those comments? annabelle: he is clarifying. basically if you are a member, sam bankman-fried looked at the deal books at summer, and then bill ackman said that he thinks sam beckman freed his telling the truth. rishaad: but he was unaware? annabelle: the truth around the deal books summit, so broadly what he said in that event, but now he has clarified comments because a lot of people interpreted them as some thing that was either defending sam bankman-fried or supporting him as well. he has now returned to twitter, he basically said just at a minimum, this is the biggest case of negligence he has seen in his career, and that has only been reinforced by sam bankman-fried's recent public comments.

and if sam bankman-fried is telling the truth, it may be more likely that he has civil rather than criminal liability. at this point, the investigation of sam bankman-fried and ftx is still ongoing. rishaad: what about this division that everybody wants to have? annabelle: ledgerx, basically the derivatives arm of ftx. it is the only one that was regulated by the cftc and also the only one that is supposed to be solvent. we understand what we're told by our sources is that this asset could be up for sale. not sure how much, but they mentioned $3 billion in cash on their books according to a november 17 filing. a number of parties are said to be interested including gemini, blockchain, and the talks are enough to advise some parties to sign nda's. rishaad: annabelle droulers on

the latest of what is happening with ftx and sbf. coming up, you will see another three acronym institution. rbi. garima kapoor gives us her take on when the central bank will spike the hike. this is bloomberg. ♪

>> we need to signal to the public, to the observers, to the commentators, that in all scenarios, inflation will return to our medium-term target in the coming months. >> what we need to do is keep the focus on the medium-term outcomes and we will deliver whenever inflation reaches 2% over time. >> looking at next year, the inflation forecast for china is in the moderate range. our focus is growth. >> are inflation is motivated. this month is 3.1%. >> the biggest rates case was in august of last year. rishaad: central bank governors

on this beast they are trying to slay, which is inflation. checking in with some of the central bank decisions do this week, we have got the reserve bank of australia poised to raise rates as it moves towards the end of its tightening cycle. you are looking at 25 basis point increase. elsewhere, it is the reserve bank of india that will slow down its pace of monetary tightening and still looking at its repo rate. we have got three 50 basis point hikes. let's have a look at what our next guest is thinking about of a 50 basis point hike by the rbi and the end of the rate hiking cycle next year. garima kapoor is the economist at elara securities. garima: good morning.

the upcoming volatility this month, we are taking into account of this now that the central banks have indicated this. it gives us some move for the rbi to go on the rate hike cycle as well, so i expect us to assemble with 35 basis this september it followed by the chances of not more than 25 basis in february. also switching at the rate hikes cycle for what is coming to gain. we have got that are wrapped -- that means the real rate would be further than 50 basis points. rishaad: how far given india's economic structure as a country to interest rates make a difference in inflation? how much has it done to shore up

the rupee? garima: the path is in the fourth quarter and that is what most studies of the central bank indicate. in the recent time the last two years, a lot of uncertainty, it .9% of loans are in housing and the market loans are falling. the moves there are very quick with the call of a quarter or so. the rate hikes that the rbi has done so far, that would be fair for monetary points for sure. that rate hiking cycle started sometime around may when they had to hike on policy cycles.

they should have started to be reflected. if we look at the data, if you look at the gdp numbers that came in last week, the gdp for the first time has fallen below 10%. this is an indication that a broad-based increase in prices is now close to the macro. rishaad: that is exactly my question here as well. it should end leading to the downside. with the reserve bank look towards shoring up that way and making sure that the money is there for economic expansions in a more meaningful way? garima: if we look at the way mpc is structured, a few members have indicated that we might be closer to in neutral rate. they're not -- there might be

reason to pause there. but remember in the case of growth, the services demand is still continuing to grow at a robust pace. the pmi numbers, which we will get soon, those could indicate that the pmi services are continuing to grow. at the same time, you have to balance the news related to what is happening on the apac side. and you are starting to see more coming, so as a central banker, you are dodging the -- but 90 is only headline cpi that will affect the currency. that is why i believe despite them being more -- on rates, it will still be 25 basis points to keep the balance. rishaad: about the current account deficit, the central bank expecting that to fall

within 3% of gdp. is that actually doable? garima: we think it is not doable. the country is at a more robust pace compared to its trading partners. you're starting to see this reflect strongly in the deficit numbers. they were exposed by nearly 16%, even as growth remained in positive territory. i do not think going forward, as the impact of covid commodity prices fade into the local trade numbers, we start to see import growth reduced to some extent. but given that the spread between domestic growth versus global growth is continual, i do think that the deficit will trend well above 3.5% of gdp. rishaad: thank you so much. garima kapoor from elara capital . while we have been talking to

garima, we have the open in india. about four minutes of trade. indian stocks are opening slightly to the downside after we had intraday record highs last week. the nifty banking index is positive, not feeding the lows we have had in this part of the world. that is a look at the indian markets. we have a lot more on the way. this is bloomberg. ♪

>> the peak is probably in. the fed is guiding to a slower pace of hikes. maybe they get almost five, but it is largely in the price. the market is not wrong to be sniffing out the possibility of a rate cut. >> i think 5% to 5.5% is what we are thinking as well. >> the fed's expectation for where the hiking cycle ends is higher than september. we already had powell telling us the dots will move higher, but how much higher is still a question. if those have been marked up to a particularly high level, we are done mentioning that 5.5 range, those have been marked up to something higher to the top end of that range, the markets will move more on that. >> it has become clear over time

a lot of that inflation is coming from disruptions on the supply side, disruptions from covid, disruptions from the war in ukraine. >> there is a slowdown coming through and i think the fed is acknowledging that is part of the reason why it is moderating the pace of hikes relatively soon. rishaad: a few of our guests on the outlook for the fed and the run-up to that december meeting taking place. foxconn at the moment is saying it is expecting to see full production resume in its china plant. let's look at the fed and discuss what a rate would cause a big jump in defaults. annabelle droulers is with us and what do you take a look at first? annabelle: the question that was asked in our mliv pulse survey this week, the vast majority of them saying that 5% will be the rate at which they start to crack.

if you change to the other fullscreen, i wanted to see that one. where we will see the canary in the coal mine, that is in the leverage loan markets. what is interesting about that is that this is an area where a lot of investors are pooling their money this year because leverage bonds actually seem like a smart bet because you have that floating interest rate and they also pay higher yields a central banks start to rise. at the same time, we are seeing more concerns developing around this sector as well, so if you change where investors are looking to put their money, that is in the investment-grade space. 60% of our respondents, or more than half, said that they would prefer to put their money in that area. if you change it on and look at it, they would say that the junk bonds are not looking as favorable and we are also seeing that play out in risk premiums given that spreads for u.s. investment-grade that have now narrowed. rishaad: thank you for that.

foxconn with their full reopening of their china plant, china being suffering from their covid lockdowns. foxconn expects a full reopening of their china plant, looking like the later part of december, all of this coming from reuters. last week, the participation of that, 6.5% up. we are seeing a 1% move thus far today. let's look at some of the business flash headlines. elon musk says that apple has fully resumed advertising on twitter to de-escalate a war between the two most financial advertising companies. adding that apple is the largest advertiser on the social media network. one of ftx's few solvent divisions is up for sale and attracting interest from potential buyers. at least 10 countries -- companies have expressed interest in ledgerx including

blockchain.com and gemini. it is considered one of the most valuable assets associated with ftx, that after more than 100 other entities filed for bankruptcy. starting the bank action as hong kong gets to its lunch break, we are really green across the board. it is a shift towards the economy in china, lifting some of those covid restrictions. shanghai and hangzhou easing already. we have this spreading across china and that is going on. "daybreak: middle east" is next. ♪

♪ yousef: this is "bloomberg daybreak: middle east." asian equities rise in the urine but strengthens as china ac