>> you are watching daybreak: asia. >> we are counting down to asia's benchmark opens. >> australia has just come online. we are watching the yen ahead of the bank of japan decision. touching a near three week high on a report the bank of japan could raise its capital bond yields at tuesday's meeting. the boj set to dominate markets. oil hitting its lowest point since war broke out in the middle east. samsung showing declining income since last quarter adding to expectations of a global chip recovery. we have breaking news when it comes to income data out of south korea. industrial production numbers seeing a strong bid. beating expectations of a

contraction of 1%. moderating from the 5.5% we saw in the previous reading. industrial production year on year, again of 3%, better than expectations of 0.1%. also better than the previous reading of a contraction of 0.5% as well. we are really seeing when it comes to chip stocks, we are looking like we are down on the day when it comes to asia and chip stocks potentially but when it comes to these numbers, south korea's industrial production numbers are looking pretty good at the moment. a couple days of strength. a lot of that has been on exporters selling dollars, but potentially with dollar weakness background we could see more when it comes to wall street. the cyclical index rising moderately month on month. prices unchanged in august, but a solid beat when it comes to industrial production.

>> sticking in korea because you mentioned chips, a big focus is going to be samsung's third-quarter earnings. we had preliminary readings. we have the breakdown and capex plans. that's going to be key for what analysts are watching for. samsung is racing against sk hynix and other big chipmakers to develop and supply next-generation dram. even though we consider profit to continue sliding, the profit slide still the company could make big spending plans or big capex announcements. our bloomberg intelligence team saying samsung could make up to 20% of global semiconductor investment. let's change on because we have just had the open of markets in australia. we are seeing the asx 200 coming online. the reading for the session today should be fairly flat for the start of trade. it is that story of the wall street session, we saw that

bounce in the later part of trading, given that the tensions in the middle east, the conflict still appears to be contained, at least for now. that is the focus for us. fortescue, a company we are watching out for as well. interview with the ceo saying china is going to be a key partner in the energy transition. fortescue as well coming online. >> i will check u.s. futures. we did see a bounce today out of correction territory for the s&p 500. largely on chip related news, western digital was the best performer. it is going to split now that it cannot go ahead with the mergers. definitely helped that index but it was a risk on session in the u.s.. for tomorrow we might be seeing some of that come off the boil but it is very early in the session. we are still below 4200, a very important psychological level, and we have plenty of people out

reiterating or stating their cases today, including as you mentioned earlier mike wilson, who has been bearish all year. and hr denny said it is improbable the s&p 500 will recoup the 10% drop from its july peak we obviously saw at the end of last week. we are seeing a little bit of funds come out of the treasury market as well according to bond futures. we will have to see wednesday what the supply is going to be like as well as the fomc. jobs data friday as well. all of those will impact the treasury market. crude interestingly enough, $.41. $82.72. the world bank did but $100 on the table as a bit of a threat in case there is disruption. it said it could disrupt between half a million and 2 million barrels a day in a scenario where there was disruption thanks to the middle east war.

>> let's look at the bank of japan. the nikkei has been reporting the boj have discussed a further tweaking of the yield curve control at the policy meeting that wraps up later today. the paper also said the bank is likely to allow further flexibility in movements. let's bring in bloomberg's economy and government editor for japan for more. paul, when you look at inflation , in particular core inflation and how we are expected to see the full year of readings for the first time in 30 years of over 2%, is the data there for the boj to move more significantly? what can they achieve if they tweaked? >> well i think what we are looking at today if this report is accurate, and let's be sure, the i's still need to be dotted, there could be developments to come. i think what we are seeing is a buying of time by the boj.

it's been caught between a rock and a hard place. meanwhile, more bonds to keep yields below this 1% ceiling it is set in july. back in july, it was unlikely we would get to 1%. well, here we are, very close to 1%. it looks like the boj are seeing a need to allow more flexibility in those bond moves. that buys them time before a more significant move, the scrapping of negative interest rates. the bank of japan has repeatedly said it needs to see more solid wage data along with the inflation before it can be comfortable about tweaking moving policy, pivoting. that is a move economist expect. april seems the most logical

move for that given a lot of the union pay negotiations will be decided in march. but we are seeing here is a bit of a stopgap move. it does have risks. reintroducing an element of doubt as to the threshold for the boj. keeps market players on the back foot to a certain extent. it also invites a constant testing of where the boj's patients levels line -- patience levels lie. >> is the boj paving the way for normalization? >> this is a bit of both. for sure it does not want to be looking as if it is having to move every time the markets pushed it. that is a bad look. it ended up being a very bad look in australia if you remember the collapse of their version of west cc in 2021.

at the same time allowing more flexibility in bond yields, allowing the market to have more control over what happens with bond yields, does kind of pave the way for more normal policy in japan. maybe reduces the extent of the shock when the boj finally pivots. >> bloomberg's economy and government editor for japan and korea paul jackson joining us ahead of the bank of japan decisions later today. our next guest expects a third of the bank of japan will stay cautious on monetary policy settings. eric, in light of the reporting we have seen on the nikkei, the move we saw in the yen and the adjustment to market expectations, do you think the boj will still stay cautious?

>> i think so. you have to remember the context of the history of the trades. dating myself a little here. as a young man, exchange student in university over the 90's, the average wage for the japanese handle was around 40,000 u.s. dollars. fast-forward to today and unfortunately the average wage is about the same. it is inconceivable but it is about the same. meanwhile australia, u.s., germany, canada, western economies are generally up 40% or 50%. the bank of japan has been adamant they need to see real wage increases. they have experienced about 18 months of negative wage growth. until that flips positive, i would expect them to remain resistant to doing things in a big way with the rates. >> does that mean we will

continue to see the background? the yield gap is continuing to be a problem. the yen is continuing a short of this blip we have seen on the nikkei report. the fundamentals are still pointing to stronger dollar and weaker yen. how long can that be tolerated? >> it is a good question. they are being pushed. you know, you saw the yield curve control, upper bound increased to 1%. are they going to try to do that again? to our point, they cannot keep doing that and maintain credibility. but i would expect they try to get one more of these incremental upper bound increases on the yield curve control and then maintain short-term interest rates. that is just a guess. knowing they have had 30 years of deflation versus just a year or so inflation, i still think given the glacial pace of

regulatory changes in japan and culturally as well, i would expect them to move slowly as long as the market allows them to do so. >> exactly. as long as the market allows them to do so. will the market have patients beyond today's meeting? a lot of focus is on april but you have some saying they have to do something sooner than that. >> it really is. a great question. they are going to try to get by with this and see what happens. again, they are going to have to balance, to your point, the macro pressures, the inflation pressures that are impacting japanese consumers with the fact that real wages are still declining and still maintain a weaker yen. there are a lot of mixed currents. if there is anything we know, it

is that they like to move slowly. if i had to guess, it would be continuation of that. >> there is one other major central bank decision we are looking ahead to a missed so many others in asia. the fed. do you expect caution to pave the way? is there more monitoring to do when it comes to the data? >> it is watchful waiting. investors were finally disabused of the notion that the fed would start messaging more dovish tones in the last few months. that's why you have seen this creep up in the 10 year. to be fair, the fed is really -- if you are not confused you are not paying attention, right? there are a lot of mixed currents. you have pmi, manufacturing strengthening, you report a

strong production number for korea. the u.s. pmi manufacturing is 50 or so, not tracking the way it has been year to date. services are above 50. you have a strong q3 gdp print a little higher than it should have been because of savings. high strong employment levels. meanwhile inflation starting to come down. but you are also starting to see a lot of cracks potentially in growth. on q3 earnings so far, 2.5% increase year-over-year on s&p 500, exceeding expectations, real revenue growth rates are actually down 2.5 percent. you are seeing a lot of companies trying to guide down. for every company seeing their estimates increase, you have 1.5 or so seeing their estimates decreased.

ups with a great anecdote, they start off 22 thinking they would have 99 billion revenue for the calendar year and they have reduced guidance several times throughout the year. as recently last thursday. the low point is now 91 billion. a significant drawdown from what they expected earlier in the year. the transportation sector has b een a bellwether for the economy. coming up, the israeli prime minister dismisses calls for his resignation over the hamas attacks. an update on the conflict next. this is bloomberg.

welcome to ameriprise. i'm sam morrison. my brother max recommended you. so my best friend sophie says you've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors, the garcias, love working with you. because the advice we give is personalized, hey, john reese, jr. how's your father doing? to help reach your goals with confidence. my sister has told me so much about you. that's why it's more than advice worth listening to. it's advice worth talking about.

ameriprise financial. explore endless design possibilities. to find your personal style. endless hardie® siding colors. textures and styles. it's possible. with james hardie™. the chase ink business premier card is made for people like sam, who make- everyday products, designed smarter. like a smart coffee grinder, that orders fresh beans for you. oh, genius! for more breakthroughs like that- i need a breakthrough card. like ours! with 2.5% cash back on purchases of $5,000 or more. plus unlimited 2% cash back on all other purchases. and with greater spending potential, sam can keep making smart ideas- a brilliant reality!

the ink business premier card from chase for business. make more of what's yours. >> the only thing i intend to have resigned is hamas. we are going to resign them to the dustbin of history. that is my responsibility. >> israeli prime minister benjamin this and you dismissing calls -- benjamin netanyahu dismissing calls to resign. for more on the conflict let's bring in bloomberg editor michael heath. does it look more or less likely now that there will be new fronts in this israel-hamas war? >> according to the markets, no. oil has dropped away because there is a sense the conflict will be contained.

there are worrying signs and obviously there has been some air attacks in syria which neighbors israel. you have rockets coming out of lebanon with hezbollah and of course you have the ongoing operations with gaza. further away, you have the h outhis who have fired missiles that have been shot down by the u.s.. the common denominator with all these groups is they are supported by iran. it is a very tense situation. the sense at the moment is it will remain contained. that seems to be the way israel is operating its ground operations. it is not so much a direct invasion. it is a piecemeal bit by bit operation. it is very much up in the air. what is good news is there is talk more aid is going to get into gaza. israeli ministers said they

expect up to 100 trucks from wednesday. that is still only a fifth of what was happening prewar. it is an improvement on what was. the humanitarian situation obviously is critical and it is an ever present danger the war does expand. >> the humanitarian assistance requested by the white house for gaza and israel has been left out of this package that has been proposed by house republicans. can you tell us how this package has been split when it comes to what has been requested for the middle east and what has been seen for ukraine? >> yes. my understanding is it is a $14 billion package. whether it succeeds is highly unlikely. it is unlikely to pass but it does not include aid to ukraine. we know within the republican party there is debate about --

because of the trump wing of the party about aid to ukraine. there is quite a lot of sympathy it seems with vladimir putin and this is not a u.s. conflict, all sorts of quite jumbled logic that goes on their. the package was also to provide assistance to taiwan. the biden administration was looking to box republicans in with the aid to ukraine which they wanted but also splitting it with israel and with taiwan, two causes republicans would generally support. they seem to have pulled their own proposal out. you would assume it is a nonstarter. they need to get money and supplies to israel. it is sort of watch this space. >> bloomberg editor michael heath with the latest as we continue to watch and bring you

those latest developments. other geopolitical stories we are following, saudi arabia's military is on high alert after deadly clashes with yemen's iran backed houthi rebels. four saudi soldiers were killed in a mountainous region bargaining -- bordering yemen. china and russia are reinforcing their bond at a military form in beijing. the vice chair of china's top military body accused certain countries of stirring up trouble. his russian counterpart also attacked american global dominance. the show of ties amid signs xi jinping and vladimir putin meet at the opec summit next month. you can get around apollo stories you need to know -- round up of all the stories you need to know on the bloomberg anywhere app.

you can customize those settings so you just get the news for the industries and assets that matter to you. this is bloomberg. ♪

x general motors has reached a tentative deal with the united auto workers to end a strike that upended u.s. automobile production. let's bring in our automobile reporter in detroit. it has been a textbook labor dispute. tell us what the president of the uaw got from gm for this deal. >> egot record pay raises. 25% general wage increase. on top of that he got the restoration of the cost-of-living allowance which takes the actual pay increase up to 33%. for lower paid workers, newer

workers, over the life of the contract this could double their pay. that was big. also got such things as the right to strike over plant closings which gives the union more power and muscle in the direction of the companies. >> what is the next target? >> i really think shawn fain wants to go after tesla and try to organize tesla which would be a large mountain to climb. he will have no welcoming arms from elon musk who has made it clear he does not want unions in his plants. if you are going to organize the future of the auto industry you really have to go after tesla. >> i hate to ask, but assuming these deals are ratified and agreed to and so on, do we risk a wave of layoffs? >> that is another part of the agreement. job security provisions should prevent that.

plant closings as well. the question is can the detroit automakers are main competitive? labor costs are going to go up. the hope is the uaw will either organize other plants to raise their labor costs or just sort of prohibitively the plants themselves will raise their wages to try to keep out the uaw. >> that is our automated reporter keith naughton with us from detroit -- automotive reporter keith naughton with us from detroit. western digital is splitting in two after talks to merge with kioxia fell apart. first quarter sales fell 26% on year. a slightly better result than analysts expected. broadcom and vmware say their merger is on track to close before november 26, the deadline.

the companies did not say how close they might be to an approval from chinese regulators, their last major hurdle to completing the deal. but they say there is no legal impediment under u.s. merger regulations. quick look at u.s. futures, dow futures turned around a few minutes ago. s&p 500 futures may be signaling we will see some kind of decline tomorrow after a bounce out of correction territory today. the s&p rallied 1.2% in the monday session. plenty more to come on daybreak: asia. this is bloomberg. ♪

>> we are getting japanese economic data. the jobless rate at 2.6% as anticipated, a little bit less tight than the 2.7% of the previous month. japan's jobless rate coming in at 2.6% in september. we also have the job to applicant ratio, unchanged at 1.29. that means 120 nine jobs offered in september for every 100 applicants. the bank of japan will be watching this very closely. a tight job market key to higher wages. that's an area the governor and prime minister are watching closely. the jobless rate at 2.6%, meaning we were down from 2.7% the previous month. >> really interesting building the macro picture in terms of what we are seeing in japan and how that supports a policy, just

a tweak but maybe a policy change from the boj. we have seen the rally on the nikkei report that the bank of japan will be talking about further tweaking of the yield curve control at the tuesday policy meeting later today. you know, do we see -- a great research note, a triple tweak? do we see a tweak or is it a case of the boj being tricky and surprising markets one way or another? >> i do not think it will surprise markets but i think the market may be over interprets what they say. that is the real risk. obviously no one is expecting a change to monetary policy, that is fine. a look at the environment, a tweak, whether that be the raising of the 10 year cap, you know, that was speculated in newspapers yesterday, if that is

the case, we would see a hawkish response in the yen and jgb yields. mind you, they are not even at 1% in the 10 year yield. whether they -- it will be interesting if they were to tweak it up to 1.5% rather than double like last time. to double it to 2% would really bring the whole program forward and cause ruckus in the dollar-yen spot market and the curve for that matter. i do think there will be maybe some measured tweaks. but it is how the market receives it in terms of what they were expecting. we have some crucial levels. i think 14730, the october 3 low, and the 15078 high that we had just a few days ago. those are the near-term levels right now.

dollar-yen is fragile heading into this. we could be looking, the boj may be a 200 or 300 point drop as an initial reaction. as shorts are unwound, bit of a yen short squeeze implied. we wait and see. it is interesting, the report that came out was talking about a temporary adjustment of the 1% cap. the actual interpretation, the translation of that, can be taken a couple of ways. i do not think the market realizes that. you think once they left that, the genie is out of the bottle and they will have a double of a time trying to bring it back down. i'm not sure where the temporary part comes into it. that is a little bit ambiguous,

the interpretation. sort of i suppose gets more readership or whatever it is. the other way is a little bit more plausible. in terms of, you know. the other interpret tension -- interpretation is by a certain degree. if they do it a certain degree, say 50 points, to get to 1.5%, that will give the market food for thought before it charges on and start slipping dollar-yen down. >> status what td is looking for -- that is what td is looking for. our wages at the point where the boj can act? >> economy wide they are not. they have had some decent wage increases in that agreement, the

wage discussions. real wages in japan have been falling many months consecutively. this might spill over into another wage negotiation next year. they have to get something north of 5%. just under 3.6% this last round of talks. to actually offset inflation and try and get real wage growth is going to take longer than the market expects. the bank of japan alluded to the fact, wages are sustainably high enough to warrant a change in monetary policy. we are certainly not at that point. >> that was bloomberg's fx and rate reporter michael wilson there. let's get to annabelle to see what's going on in markets. both futures markets and what is

to come for today. annabelle? >> we are taking a look at japan futures. contractors coming online in singapore. we are pointing to a bit of a drop here. standing out from other markets in asia. given the boj when you have stronger yen coming through, higher jgb yields, these are things that can pressure equities. financials could see outperformance. certainly a lot of attention focused on that meeting, the decision later. what we are seeing in the session, some markets are online. australia and new zealand are two of them. the asx 200 up 0.2% in trade so far as we see investors starting to have more -- less anxiety really feeding through around developments in the middle east. that's playing into the trading we have seen so far. the question is how long that will last. one of the factors is why we can expect further volatility in the

weeks ahead and months until the end of the year, really comes down to the changing expectations around earnings. estimates for the fourth quarter are already being revised lower. what is leading that, health care that is being very much under pressure tied to growth expectations. material stocks as well. these have really been as i said the earnings expectations, they are dropping for the sectors. most actually negative territory that we do see, some still clinging to gains. i.t. is notable. and energy in focus. >> we will stay with energy. thank you for that. energy markets on tenterhooks. let's cross to singapore and the head of aipac research. we had the world bank throwing around numbers like $100 a barrel if we see any disruption through oil markets. how do you see the continued conflict impacting energy markets? >> we have seen a lot of

volatility since the conflict began for oil specifically we saw wti and brent at their high. 10% higher prices compared to when the conflict began. if i look this morning, wti is back to levels comparable to before the attack. brent is higher but it is lower than the peak. this is going to depend on whether we see any physical disruptions to close. we have not seen that for oil yet. for gas, the news just about 12 hours ago, there has been a stoppage in gas supplies from israel to egypt, did move the market for a little bit. very quickly though european traders did realize the impact is going to be limited. while egypt does have lng export capacity since summer, it has not been exporting that much. overall its share of the market is limited.

ultimately this is going to come down to whether we see physical disruptions to oil flows. this is really important around what's happening in the strait of hormuz. as long as we do not see disruption we are going to be seeing these types of minor volatilities as a result. >> you were at the international singapore energy week. what was most notable to you? anything in particular that jumped out? >> it was notable particularly in terms of the announcement the first day. it encapsulates the stage of the energy transition. first and foremost, for all countries, energy security is critical. we saw the first day singapore announced the launch of a new casco, central government owned entity in charge of procurement

of gas for the power sector, for singapore. the country relies on 95% of its electricity from gas. with the singapore government is doing is by next year they are going to set up an entity that's going to look at the contracts that the existing private power generators have for gas procurement. they are going to start buying gas if there is a shortfall in those contracts and as they expire it's going to require power generators to actually let the central entity procure on their behalf. this is essentially going to give scale for procurement of gas for singapore. it also allows to have a central entity that can look at diversifying supply and ultimately provide long-term stability. at the same time, the government announced conditional approval for imports of clean power, primarily from offshore wind in vietnam. 1.2 gigawatt.

the government announced that by 2035, they will have four gigawatts of import contracts for clean power from neighboring countries. they have given conditional approval, that includes the 1.2 from vietnam that was announced. and one gigawatt from cambodia. also some announcements around mixed technologies. you can see the balancing, cap for energy security in the short-term but still make sure you are investing in long-term energy transition. >> thank you for that. breaking news for you now. samsung l with results saying third-quarter console operating profit, 2.4 3 trillion won. feeding the estimate ever so slightly. it is slightly under what the preliminary numbers were earlier in the month. we will see how the market takes

it. in the third quarter, sales, 67.4 trillion won. again a miss. consolidating net earnings for the third quarter, 5.5 trillion won. the estimate was for 2.5 trillion won. that was about double the estimate. they did report in the third-quarter operating loss from the chip business of 3.75 trillion won. the obvious focus is on whether we have seen a bottom for samsung. we saw massive decline in the july to september quarter. we are looking forward to the third-quarter results to tell us more about the future. let's bring in mark gurman who has been following these lines. what does this tell us about how much samsung is improving from

the trough? >> we are seeing improvement. on the consolidated net, double the estimates. we are not liking what we are seeing. we are seeing annual declines across the board, consumer electronics sales down 7%, display sales, that's the situation where they actually sell their components to other phone makers and computer makers, down 12%. network sales down 7%. chip sales of course improved. still down 30%. we are not nearly out of the woods yet. it is an improvement but we are not going to like what we are seeing until we are back in the green. >> how do you weigh the competition? when it comes to samsung, things are getting tougher. >> things are certainly getting tougher but samsung is in the unique position where they are so vertically integrated, not

only did they make their own appliances, they sell components to other consumer electronics companies. apple of course is a big customer of samsung. even that samsung plays in both industries, in house development and outsourcing their chips elsewhere, they have the negative impact of being hit on both sides of the coin. consumer sales are down because people are just not buying electronics and other things samsung sells in the numbers they did a year ago. other companies as well, so they are in bad shape on both sides but there is anticipation from research analysts things are going to turn in 2024. samsung is going to build components and they will be there to take advantage on both sides. the good news for samsung is when you see improvements in one area of the business it's going to apply to others as well.

>> the latest on those samsung numbers. we will get more analysis of course. you can get more analysis from our team of expert editors at tliv . this is bloomberg. ♪

the chase ink business premier card is made for sam who makes, everyday products, designed smarter. genius! like 2.5% cash back on purchases of $5,000 or more, so sam can make smart ideas, a brilliant reality! chase for business. make more of what's yours.

>> fortescue metals driving down the cost of renewable energy. earlier i spoke with the ceo here in sydney. >> china plays a really critical relationship partner for us at fortescue. particularly now as we are decarbonizing our operations china will play a more important role developing renewable technology in solar and wind and getting the cost down to ensure we can all decarbonizing our operations profitably. >> how do you see the demand side with uncertainty over the property sector? >> we have seen demand from china over the last 10, 20 years , particularly robust for our product. into the future particularly our product mix, we are confident the demand will continue to be there. even at 5% gdp growth in china,

a much bigger base, we see continued robust demand for iron ore particularly out of australia. >> you have talked about how the relationship can transition if you will into the future with more green energy, more sustainable options. what does that look like in terms of the partnership's being explored? >> for fortescue we have been a successful iron ore company and 12 months ago we announced a pivot into energy and technology. for us the partnership with china on technology development, a electrolyzer's driving the cost down for electrolyzers, pivots into our energy side of the business to get those projects at an economic basis so we can grow the portfolio and help satisfy the global need for decarbonization. >> has the geopolitical site help to? i know you will be in shanghai to coincide with the prime minister's trip. has there been a change of tone?

>> we certainly welcome the change in tone led by the prime minister of australia. you are right, i will be there next week is sitting operations there. 20 years successful operations in shanghai. also with the prime minister next weekend in china. we really welcome the warming of the relationship. >> we know fortescue is a proponent driving the energy transition and it is hard to keep track of projects. there is such a huge portion to green energy and hydrogen. can you tell investors when we could start seeing financials and the reasoning behind this? >> sure. the pivot, the early stages of our entrance into the iron ore market was -- there was an opportunity that grew quite rapidly for fortescue. fortescue 2.0 is saying the same market, albeit the market in

the green energy sector, will eclipse the resource sector, hence our position on a number of areas we are looking for. in terms of projects we have announced we are bringing a number to our board very imminently. we are looking forward to announce some of those first projects as we diversify our portfolio in the energy sector. >> that was our exclusive conversation with the fortis q metals ceo. -- fortescue metals ceo. we will have more with the australian strategic materials ceo. >> breaking economic data out of japan. retail sales month over month, we saw a decline of 0.1% as inflation weighs on the consumer in japan. year-over-year the number was up 5.8% which was a decline from the previous month 7.1% gain.

also lower than economists were expecting. retail sales month over month in japan, we are down 0.1%. economists were looking for them to rise 0.2%. the previous month had seen them up 6%. industrial production also a disappointment. factory output as it turns out increased 0.2% in september from the month earlier. it did rise for the first time since june but economists were looking for the number to be a lot stronger rising 2.5%. these are the september preliminary data. year-over-year the number was a decline of 4.6% even as we know japan's automakers played a big part in strength into those figures. plenty more to come on daybreak: asia.

>> sam bankman-fried has returned to the stand in his fraud trial. prosecutors argued he was in charge at ftx and alameda research ahead of its collapse. this is the first time sam has faced cross-examination. >> he was grilled for four hours by the assistant da and he was forced to admit taking a bigger

role at alameda then he has previously admitted acknowledging he did realize alameda had not hedged against significant risk. it was his third day on the witness stand. while he previously testified he did not defraud customers at ftx, that he did make mistakes, but it was not fraud, he gave a lot of invasive answers. he said answers like, i always believe there is a risk of a hol e. bottom line he said alameda and ftx were solvent in his view. the key takeaway is that the prosecutor managed to use his own words against him. a highlight of the cross-examination, she used his tweets, his emails, tax form and testimony, all containing assurances the change was safe

and alameda played by the same rules as others. so many evasive answers the judge finally said answer the question. the cross-examination will likely continue through noon tomorrow after which his own attorney will answer -- direct some questions. the trial expected to end later this week. >> samsung essentially an upbeat tone, profit was double estimates. we did see a drop in chip sales by 29%. it was a drop, much better than the drop of 86% from the previous quarter. it looks like we may have seen the trough. the semiconductor market slump may have bottomed out. we hear more in the conference call. the market opens in tokyo and seoul next. ♪ ? ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines.

hi, i'm katie, i've lost 110 pounds on golo in just over a year. styles and textures. golo is different than other programs i had been on because i was specifically looking for something that helped with insulin resistance. i had had conversations with my physician indicating that that was probably an issue that i was facing and making it more difficult for me to sustain weight loss. golo has been more sustainable. i can fit it into family life, i can make meals that the whole family will enjoy. it just works in everyday life as a mom.

>> this is daybreak: asia, counting down to asia's major market opens. it's going to be a fascinating day. not only do we have the boj to look forward to. we have had a spectacular amount of breaking news related to japanese markets for the main part in the last few minutes. >> we are seeing that big move. all of this is sort of continuing to complicate matters as we get into the bank of japan decision later this afternoon. you have to look at the data. jobless numbers came through earlier painting the picture of an economy that may be at least when you look at inflation numbers ready for more than a tweak. >> there is really one place we want to watch at the start of trading for japan and south korea. that is the direction of jgb yields. still holding.

this is coming online. we are above the 0.9% mark starting to test the 1%. that is going to be very significant over the course of the session. what we want to know out of the boj meeting is are we going to be seeing greater flexibility on where the jgb yield can trade? we had local media in japan reporting that bond yield could rise above 1%. we have seen traders testing where they think the boj should be going in the policy direction through jgb's. we have seen option markets, swaps, also the japanese yen, strengthening coming through, still holding down around the 149 level. that is really a very big focus for us in the session today, the direction of jgb yields that have also been tested by the moves we are seeing in treasuries. you see the 10 year yield holding steady but still close to the 4.9% mark. >> that is the key story for us.

i cannot say it enough. the boj session concluding today. really watching what we get in terms of the direction for policy year. stock wise when you do see that we can expect stocks to trade under pressure through the session. another big sector we are watching, we will have that in a few minutes. financial stocks can benefit out of the rising rates environment. another key area to watch. taking a look at the direction of the jgb yield given local media reports saying it could be allowed to rise above 1%, the question really around the flexibility that will be given. let's change on because in the session today we have also got samsung just starting to trade here. earnings out in the last 20 minutes or so. that stock is rising. as is sk hynix. essentially topline we saw profits beating expectations in the third quarter. net income was still down 40% but it was better than the three months prior. we are getting signals here that the rout in the chip sector

could be starting to bottom out. that is a supportive factor. you are seeing that in the korean won. reducing further buying into korean equities. let's change on because we have the open for australia one hour into trading. stocks leading but the broader index up half a percent. brent crude coming online edging a little bit higher but still we saw it down the most in three weeks. the israel-hamas war still a focus. it appears a little bit contained for now. >> thank you. we will be watching those yields carefully. the yen trading at 14915 after a report the bank of japan may raise its cap on government bond yields. joining us from tokyo is the chief depend desk strategist at mizuho securities. with this market action does it look like the bank of japan is being forced by markets to actually do something? shoki: first of all thank you

for having me. i think the boj as you said will readjust the ycc band. the 1% cap, because obviously -- because honestly i think the markets are testing 1% and they do not want to launch operations as well as long operations after so that the market will be confused. >> you are saying there will be a tweak this evening and how will markets receive that? >> i think markets will receive it as -- it is a continuation of the ycc but they do not want to see australian or u.s. like hit

by the markets going against ycc. >> so what will the accompanying statement say? what will we hear the governor say at his news conference? >> what he will say is in the july meeting he said 1% is too far but now the external environment, looking at the u.s. yields, we have refunding today, it is likely he will say he was not really expecting yields to be this high at this level. they had to kind of expand or remove the cap. make policy more flexible. at the same time make the boj policy tokyo hands-free.

>> we are seeing the 10 year yield back off 96 basis points. it is still perilously close to 1%. i am curious if the boj will be able to ensure markets stay calm through this process. >> i think after the boj and p.m. outlook report is out and after seeing governor ueda's speech at the press conference, of course jgb's i think will be sold across the curve. especially the 10 year will be sold. at the same time, they will still have to buy the 10 year bond to calm down the speed at which yields rise. i think it is going to evolve

for a while until, say, the next 10 year option. in november. otherwise it is going to be stable. >> where do you think the equities rally goes from here? we will see a lift when it comes to financials. that is playing out in the early part of the session. has the exuberance been taken out of the rally? shoki: equities is not my thing. i cannot really comment on the specifics. but as you said, i think financials will gain from higher yields. especially 10 year. that is for the major banks. in terms of -- will benefit from

higher yields. >> let's get you back to annabelle for those movers. we talked about the financials just now. >> that is right. as you said, it is the outperformer so far. broadly we have japanese stocks trading in the red but financials here are jumping these biggest financial stocks in the country. what is driving that is what you were discussing. the moves we are seeing in jgb's, the nikkei report saying the boj could discuss a further tweaking of yield curve controls. that is the big focus as we head through the market session today, where we see jgb 10 year yields trading and also the strength coming back into the japanese yen. that is the state of play for this sector. the other focus for us at the start, the open for japan and korea, is samsung.

stock is moving higher. essentially signals the chip sector is going to bottom out. you have more on this. >> thank you very much. want to point out that apple has started its event. thus gary event it had broadcast was going to happen today and it has announced an m3, pro, and max chips in use. will be diving into these announcements. we are just getting the first lines out. for a deep dive into samsung third-quarter results let's bring in bloomberg executive editor for a is a -- editor for asia technology. an exaggeration to say we saw a cheery quarter given the steep decline on so many segments but it really was for samsung. >> there is still downturn in the chip industry causing strains on the business. what we did see is on the net income line, we saw the numbers

more than twice what was expected for profit for samsung, so that is positive. if you look across their businesses, there are signs of improvement in a number of areas. first and foremost the memory chip business is very important for them. they lost money but it was narrower than the quarter before. they got a significant bump in the profit in the mobile panel business. several customers launched flagship models of their mobile devices. apple is one of their biggest customers. there is demand from apple in particular pretty strong. other areas seemed to signal positive signs. they said in the memory chip business which has been closely watched because it has been a drag on the tech industry overall that they expect recovery partly because of artificial intelligence and also they expect prices to recover in the fourth quarter compared with the third. >> i guess the question is sort

of -- do we take this as a broader bellwether for the rest of the sector? we know there are specificities to samsung that give them that advantage. >> that is exactly right. samsung is probably best known for its mobile devices. they are high-profile, they have a lot of appliances they sell. they also make these components that go into devices across the check industry -- the tech industry. they are an early indicator of how things are going in the tech industry. profits are down, revenue is down. there are downbeat signs within this. but they are much above expectations and it seems to be positive for the tech industry. first and foremost the downturn in the memory chip business seems to be recovering. they see signs of increasing demand, stronger demand in a number of different areas. overall that is probably positive for the tech industry

and for their shares. >> bloomberg executive editor for asia technology peter elstrom with the latest on samsung. let's look at -- of course we are dealing with earnings, central-bank action as well when it comes to broader markets. wall street scaling back its positive views when it comes to u.s. equities into the year end on rising geopolitical risks. let's get to the market action now with our chief rates correspondent for asia. mliv contributor garfield reynolds. we are getting some caution. that could be potentially well advised given the uncertainty over what we would get from the bank of japan either at this meeting or the next. >> that is right. anybody who thought this boj meeting was going to be a quiet one because of the strong expectations the boj is some way

away from actually changing policy has been disabused of that notion overnight. by now. even if they end up not doing anything the way the nikkei report has hit markets will mean we just get more volatility. we are facing a situation where the most likely set up is that the boj is going to go on gradually moving toward ending its current extremely easy stance, which is a lot of bond market and currency market participants, business traders and some economists are all basically saying you need to end this now anyway. you have achieved your goals. and by maintaining this extremely easy policy, at a time everyone else is tight, you are just adding to the damage you have already done to your own market into other markets.

but boj looks set to do things gradually. you have this constant drumbeat from them of, your potential volatility, bias toward higher yields, uncertainty, that word again, about what japanese investors are going to do. are they going to shift money home rapidly, or are they going to stick with some of the investments in u.s. treasuries? if they are going to do that, are they going to demand higher yields? are we going to get japanese investors becoming less price agnostic than in some ways they have traditionally been? that adds to the uncertainties for bonds, it also adds to uncertainties for stocks. especially as you pointed out with what's going on when it comes to two wars we now have that are looming over the outlook for the world in the

middle east and of course in ukraine. >> the bank of japan is watching the markets very closely. the markets have a tremendous amount of power here. they also have to watch the economic data. we got confusing economic data today showing that on the one hand perhaps there is a strong labor market but on the other hand perhaps consumption is getting hit. certainly production is. >> you know, the impact of the inflation they are saying is not yet sustained enough. that can help to undermine consumer demand. it can also undermine your manufacturing. goods are getting priced out of the market to some extent. they need to raise prices because of what's going on.

that has a hit to demand. there is also the general strains that are being seen on parts of the global economy, both in developed markets that are starting to show signs that the extreme rate hikes elsewhere are having an impact again, wars and supply shocks also having that impact, and then closer to home for japan, china's economy has been struggling despite china's efforts to stimulate it. it is definitely a difficult backdrop. a lot of investors would argue amidst that backdrop, the last thing the boj should be doing is continuing to pursue policies that are past the use by date and that by dragging it out it is adding to the uncertainty, creating more distortions where they are just not needed. >> thank you so much.

i know you will be watching closely. the israeli prime minister to mrs. -- prime minister dismisses calls for his resignation. an update next. this is bloomberg. ♪

thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh the chase ink business premier card is made for people like sam, who make-

everyday products, designed smarter. like a smart coffee grinder, that orders fresh beans for you. oh, genius! for more breakthroughs like that- i need a breakthrough card. like ours! with 2.5% cash back on purchases of $5,000 or more. plus unlimited 2% cash back on all other purchases. and with greater spending potential, sam can keep making smart ideas- a brilliant reality! the ink business premier card from chase for business. make more of what's yours. >> the only thing i intend to have resign is hamas. we are going to resign them to the dustbin of history. that is my goal and my responsibility. haidi: benjamin netanyahu dismissing calls to resign over

security failures stemming from the october 7 hamas attack. for more let's bring in bloomberg's bruce horner. -- bruce einhorn. what is the latest, what are the expectations now going forward for the next phase of the war? >> we just saw the clip of prime minister netanyahu saying he was not going to resign. that is following criticism the prime minister faced after he posted something on social media essentially saying he was not responsible for the intelligence and security failures that led to the attack, saying intelligence agencies had not warned him. he faced criticism after that. he retracted the post and did issue an apology. in his briefing he talked about the ground invasion.

that is ongoing. other things in the region, the special envoy for syria for the united nations warned at the security council that the situation there is getting worse, the risk of war extending beyond israel and gaza into other parts of the region he said is not just a risk, it has already begun. the u.s. has said its forces in syria and iraq have been attacked about two dozen times over the past two weeks. the u.s. has warned it will retaliate for attacks from iranian backed proxies in those places. >> how much is netanyahu directing the next steps and how much is his cabinet? if he were eventually to have to

go, it does not sound like he wants to, but if you were to go, with the war be continuing the way it is? bruce: it is unlikely the prime minister will resign. he has no intention of resigning. there is a national unity government with one of the leaders of the opposition, benny gantz, joining the government. even though the prime minister has lost a lot of the support in israel as public opinion polls show, it does seem like for now at least, there is not going to be any change in the government. there will be presumably repercussions at some point down the road. but for now, this is the government that israel has. >> there have been raids in a west bank city. the israeli military has exchanged fire across the lebanon border and conducted an

airstrike in syria. will the aide president biden has promised for not just israel but also gaza and humanitarian efforts -- will we see movement on that in the u.s. house? bruce: in the u.s. house we have a new speaker, mike johnson, who has said he's going to push forward proposed bill that is different from what president biden has called for. president biden wants aid to israel as well as ukraine, taiwan, he wants aid for humanitarian assistance in gaza and israel. the proposal mike johnson has unveiled does not have that. it is about $14 billion for israel that does not include ukraine, does not include taiwan , does not include humanitarian assistance. also offset the cost of that aid

by taking it from funding that had gone to the internal revenue service, the tax collection agency that had been passed by the democrats in the previous congress, something republicans have used as a talking point attacking aid to the irs. it is unclear how realistic this is, whether there will be negotiations, but it does seem like there's an impasse between the republicans in the house and the biden administration over what sort of aid will go to israel and when. >> that is bloomberg's bruce einhorn. other geopolitical stories we are following, saudi arabia's military is on high alert after deadly clashes with yemen's iran-backed houthi rebels. four saudi soldiers were killed bordering yemen. saudi arabia's defense forces

have also intercepted a missile in its territory fired by houthis. china and russia have publicly reinforced their bond at a military forum in beijing. in a veiled swipe at the u.s., the vice chair of china's top military body, accused, quote, certain countries of, quote, stirring up trouble. his russian counterpart attacked american global dominance. the show of ties comes amid signs chinese president xi jinping and president biden could meet at the apec summit next month. you can get a roundup the stories you need to know to get your day going in today's edition of daybreak. bloomberg subscribers go to dayb on the terminal. you can customize your feed so you only get results on the industries you care about. this is bloomberg. ♪

♪ explore endless design possibilities. to find your personal style. endless hardie® siding colors. textures and styles. it's possible. with james hardie™.

vonnie: looking at some currency action. the yen trading at 149.30. relatively muted before the bank of japan policymakers meet to discuss the 10 year yield target. a little bit of strength for the korean wan versus the u.s. dollar. we got better economic data out of korea than anticipated. and havens, the kiwi and the aussie dollar not moving you want to be able to provide your child with the tools or resources they need. with reliable internet at home, through the internet essentials program, the world opened up. fellas, fellas. that's how my son was able to find the hidden genius project.

we wanted to give y'all the necessary skills to compete with the future. kevin's now part of this next generation of young people who feel they can thrive. ♪ ♪ you're probably not easily persuaded to switch mobile providers for your business. but what if we told you it's possible that comcast business mobile can save you up to 75% a year on your wireless bill versus the big three carriers? have we piqued your interest? you can get two unlimited lines for just $30 each a month. there are no term contracts or line activation fees. and you can bring your own device. oh, and all on the most reliable 5g mobile network nationwide. wireless that works for you. it's not just possible.

haidi: this is "bloomberg

daybreak: asia." a key story we are watching in the market today in terms of market reaction. the boj today meeting concluding on tuesday. local media in japan said the bank of japan could allow further flexibility to its 10 year yield perhaps temporarily allowing it to rise above the 1% mark. this morning we have seen jgb yields spiking trading at a level we have not seen since 20 12. a lot of anticipation building around what we will get later from policymakers. will we see any changes to the program of yield curve control. the anticipation has fed into the japanese yen. strengthening coming through though it has given up some of those moves in the early part of trade this morning. in terms of stocks, it clear

outperformance -- a clear outperformance for financial ones. that is the key market story, investors will be watching that in the session today. the boj policy meeting and will they make any changes to their policy. these stocks -- key stocks we are watching in korea, samsung. you are seeing it moving higher. sk hynix as well to the upside. haidi: we have been here this morning at the mining and resources conference in sydney talking a lot about the

transition and everything that needs to be in place for the targets to happen. our next guest focuses on the mining. they offer one of the few supply options outside of china. we will be talking about the geostrategic aspect of the business. joining us exclusively is rowena smith. really great to have you with us. let's start with that. you talk about the unique positioning of the business in terms of being able to supply critical materials that often times are being controlled by china. rowena: there is an established supply chain in critical minerals dominantly in china. over 90% of the mining as well as the processing and magnet production is sitting in that jurisdiction. our proposition is to provide an

alternative supply chain for countries to be able to have some choice about where they are taking the product from. haidi: we are talking about countries like australia and allies like the u.s. these governments have made this a critical policy priority in terms of being able to secure supplies. how has it benefited? rowena: i would mention korea, europe, japan and the u.s. working with australia to develop this alternative supply chain. covid taught a lot of lessons about the vulnerability when you allow one supply chain to dominate. these countries recognize they saw disruption for the supply chain in particular during that period. there is a lot of policy and urgency around establishing alternative. and it is in part to provide diversity but also to enable growth.

the end of market for these products is anticipated to grow strongly over the next 5-10 years. you mentioned the geopolitical stresses but it is also a straight demand-supply story as well. what we are seeing is a lot of policy to incentivize investment in both the mines and the processing of the materials to be able to feed into the end-user industries. haidi: what is the timeframe? rowena: we are working at the moment on talking to off takers and finalizing funding. we are targeting the end of the next calendar year which will see us with first production early in 27. haidi: what about the customer

base? rowena: one advantage is that we will take the product from mine through to metal. when i was talking about first production i was talking about the mind in new south wales. we have also built the metals part. but is already built in to production in korea. we are working with emerging magnet producers in korea, the u.s. and europe doing customer qualification process. we are getting quite a wide range of customers. and they themselves are the suppliers into those big oem's. haidi: will that contain costs? rowena: there are a few reasons why you do it but one is because if you don't work collaboratively to establish the end to end supply chain you probably have to go back to the

existing supply chain and you won't see a come back out again. it is important if we are making the effort at the front end to make sure there is a pathway all the way through to customer. but also as you say if you are only going to play in one piece of the supply chain you run the risk of being squeezed. minimizing the number of parties across the supply chain and developing strategic relationships so you can have sensible discussions about how you share margin across the supply chain protects the business particularly through the first 10 years of establishing this alternative industry. haidi: we talked about the fundamentals of supply and demand. if china is controlling 90% of what we see in terms of raw materials, do you think there is enough outside of that to be able to drive the energy transition? rowena: there is not enough today. that is why this is an important

opportunity for us to pursue. what we are seeing, i was in washington last week and detroit and a conversation i had with an auto industry advisor, they were talking about the tax incentives in the u.s. to incentivize the auto producers to use non-china product. he said, it is not just the growth in the total ev market but it is the movement away from the established supply chain that will make a difference. as of today only 20% of the dvds on the market in the u.s. -- of the ev's on the market and the u.s. will be compliant next year. we will see the users grow in volume but also wanting to move towards the alternative supply chain. but to be able to meet that demand we will have to move rapidly. haidi: we have seen government engagement through the inflation

reduction act. how much engagement have you had with the government? what would you like to see policy wise to be able to ramp that up in a timely manner that meets the deadlines? rowena: one of the reasons i was in washington was i was part of the round table with the prime minister when he announced the $2 million going into their critical minerals facility. i, it would be that i think the state level, there is a lot of attention being spent on how to really accelerate the development of critical minerals in australia through partnerships with allied countries. it was very evident last week. city -- sitting at the table with the prime minister and the secretary, you could see the urgency, intent and alignment on how we work together to play to each other's strengths to make

this happen. haidi: really great to have you with us. rowena smith, the ceo at australia's strategic materials. such an important part of what we need when we talk about the energy transition. we spoke about that with another miner working hard in the green energy space. they also see china playing a critical role in driving down the cost of renewable energy. i spoke to them earlier here at the conference. >> china plays a really critical relationship partner for us particularly now as we are decarbonizing our own operation. china will play an even more important role for us as we develop our alternative tech elegy getting the cost down to make sure that we all can

decarbonizing profitably. we have seen demand from china over the last 10-20 years be robust for our product. and into the future, we are confident the demand will continue to be there. and even at 5% gdp growth in china on a bigger base we see continued robust demand for iron ore coming out of australia. haidi: you have talked about the relationship transitioning into the future with green energy and more sustainable options. what does that look like in terms of partnerships? >> for fortescue, we have been successful and we have pivoted into the green energy sector. our partnership with china in particular driving the cost down

pivoting into our energy side of the business to get the projects at an economic basis so we can grow the portfolio and help satisfy the global need for decarbonization. haidi: has the geopolitical side helped? you will be in shanghai. has there been a change in tone? >> we certainly welcome the change in tone led by the prime minister of australia. i will be there next week visiting our operations there in shanghai with the prime minister. we really welcome the warming of the relationship. haidi: we know it is a big proponent in driving the energy transition and it has had to keep track of the various projects. such a huge push into green energy and hydrogen. could you tell investors when we

will see the reasoning behind it? >> the early stages of our entrance into the iron ore market, there was an opportunity that grew rapidly for us. we are seeing the same market, particularly in the green energy sector, will eclipse the current sector. in terms of the projects we have announced, we are bringing a number to our board imminently and we are looking forward to announcing the very first projects as we diversify our portfolio. vonnie: that was our exclusive conversation with the four disc you ceo -- fortescue ceo. the japanese prime minister saying the government must coordinate with the boj on macro policy. it sounds like he is in part

referring to the --. this is bloomberg. on purchases of $5,000 or more, so sam can make smart ideas, a brilliant reality! chase for business. make more of what's yours. is it possible to fall in love with your home... ...before you even step inside? ♪ discover the magnolia home james hardie collection.

available now in siding colors, styles and textures. curated by joanna gaines. vonnie: as we awake the boj decision we want to point to the japanese yen trading at 149.33. we have also heard from a japan

official saying the government must coordinate with the boj on macro policy and it sounds like he is referring to the tax rebate. he said the government will stimulate the economy to ensure the tax -- can be one off. he also referenced abe saying the top priority of abenomics was as gaping inflation. it looks like traders are still waiting for any decision out of the boj. haidi: yes. such high stakes. a little nervous when it comes to a potential halloween surprise from the boj. we are also watching chinese property. ever grand has laid out a potential plan on a liquidation order. a lawyer says they are looking at using subsidiary shares as key components in any further debt restructuring.

let's bring in kevin kingsbury. where are we at? >> yesterday the judge gave evergrande and the petitioner in the winding up case five more weeks to go over the proceedings. over that time the judge said program must present a concrete debt restructuring plan. once ago it got votes for the old -- stoppard plans for the old debt restructuring plan. as you just mentioned the new plan may look like where a lot of equity might get issued. it has a key five week period. can evergrande get a new plan together? vonnie: the judge said i will grant you it but this is the last time. was this all things to the ad hoc creditors or a specific group of creditors and are they writing the terms at this point? >> the ad hoc creditors last

year and early this year as they worked together to put together the initial plan, they were on board. there has been caution and lackadaisical efforts on behalf of the creditors lately. they don't know where evergrande is standing because they felt bamboozled by the delay. there has been not opposition but caution on their part about where things will go from here and how much they may get in recovery. vonnie: kevin, you will be on the case for us. thank you very much. our china credit editor, kevin kingsbury. hsbc will lay back its own shares. it -- the ceo spoke with bloomberg quibi after hsbc announced third-quarter profit which missed estimates. >> i am very pleased and that we reported 29.4 billion dollar profit for the first nine months

of this year. that puts on -- that puts us on a good path. very pleased with the 3 billion-dollar buyback that we announced today taking it to 7 billion for the full year. i'm also pleased we have announced another tencent dividend. i do want to draw attention to the fact that we had some treasury losses on our treasury instruments. we were seeking longer duration higher yield in treasury estimates -- instruments. that will be fully recovered over subsequent courses. that is all about our hedging strategy rather than an economic loss. it is a timing difference between a loss today and future profits. i think we are well-positioned. we have good momentum in the business.

that is evident in our wealth performance. our revenue is up 6% in the quarter. our trading assets were up 12%. $34 billion of net new investment. bringing it to around 77 billion for the last 12 months. that is good momentum in diversifying our revenue stream. >> on the buyback it does come in higher than the estimates. 3 billion u.s. dollars. investors always want more. is there scope for more? >> we have strong capital generation. as you see in today's results. we have also announced when we set our canadian business in q1, it is our intention to do a further special dividend and then continue -- and then consider what we do with the

remaining proceeds at our disposal. i think we got good capital generation this year and have good prospects for the next 12-24 months. we are in good position to award our shareholders for their patience and loyalty. >> i want to talk about the china part of the story. you put up some charges of around half a billion u.s. dollars in provision charges on some of the losses there and you i've talked about in this statement the uncertainty in the commercial real estate market of china. how do you see that story evolving? is it fair to think further charges will be coming through in the quarter ahead? >> we signaled that the end of last year that we had a possible downside scenario. if you look at what we have done in q3, half a billion is what we took in the first half, we

booked around 800 million of that one billion plausible downside. there is a potential for a top up to that. but i think we are relatively comfortable with where we sit at the moment in our provisions. and by the end of the year we will be well provided on our exposures in china. it is an evolving situation. we will keep it under review. we think we will be in a good position at the end of the year in our provisioning. vonnie: that was noel quinn speaking with tom mackenzie. plenty more to come on daybreak: asia, this is erg. ♪ ♪ ♪

be ready for any market with a liquid etf. get in and out with dia.

>> we are launching the next generation by debuting three breakthrough chips at the same time. introducing m3, m3 pro, and m3 max. they feature groundbreaking technologies and show how far they have come since the debut of the m1 family. vonnie: the event just took place in the last few hours. it has announced new -- a new processor. rolling out a new chip with

major improvements. it is the first time apple or any other high-volume computer manufacturer has moved to the three nanometer technology. they are aimed at higher performance machines. the central processing unit has 12 cores with 18 for graphics. it is all adding up to the fact that it is making it 18% faster than the chip from 2021. for a look at some stocks to watch when markets open in hong kong and mainland china. focused on sam sounds better than expected third-quarter forecast and expectations that memory demand will pick up next year. and keeping an eye on energy producers. the world bank warns that even small disruptions in crude supply could send oil prices

higher than even $100 per barrel. haidi: yes, we are waiting for the bank of japan. do we get the halloween surprise? we know the governor would potentially see it as a trick rather than a treat. we are seeing the bond yield go hi. we saw the jump in the yen to the highest in about three weeks. they are discussing a further tweak of the yield curve control. huge repercussions for global markets if we see that change in policy from the boj. ♪

♪ dramatic music ♪ [flight attendant alert] [baby crying] [snoring] [luggage rattling] [baby crying] ♪ dramatic music ♪ ♪ upbeat music begins ♪ for everyone who's endured the bad seat, finally, sweet, sweet redemption. the lexus tx. three-row luxury that treats every seat like the best seat. (♪♪) you want to be able to provide your child with the tools or resources they need. with reliable internet at home, through the internet essentials program, the world opened up. fellas, fellas. that's how my son was able to find the hidden genius project. we wanted to give y'all the necessary skills to compete with the future. kevin's now part of this next generation of young people who feel they can thrive. ♪ ♪