cathay pacific has announced a $5 billion u.s.ization plan, including a rights issue to battle the unprecedented difficulty brought on by the coronavirus. even before the pandemic, cathay pacific was under in norma's pressure -- under enormous pressure. his response is to criticism from all sides. francine: let's take a look at what you should be watching out for later today. in a few minutes from now we will get your area gdp. nato secretary-general again stoltenberg will deliver an address. to leave rates above zero and committed to reusing their full range of tools to support the u.s. economy. coming up, we speak to eric collins, founder of an ethnic fund to help ethnic minorities. that is coming up next, and this is bloomberg. ♪ francine: economics, finance, politics. this is "bloomberg surveillance." impact x is a venture capital fund which makes direct investments in startups by black and female leaders in europe. it aims to support business which would otherwise be disproportionately underfunded. its chief executive, eric p

i think we are still going to have the premium cathay pacific dragonand i think cathay will get reorganizednd routes. thehe bottom we will have budget carrier, hong kong express, that serves mostly the hong kong to japan route and hong kong to southeast asia routes. i guess for shareholders, we think cathay pacific right now is slightly undervalued because of the recent, the outbreak of coronavirus and the halt of air traffic. the protests in hong kong also played a part in the share price pressure. but i think most of these issues in the laterlved part of 2020 or early 2021. that is the main reason why we think cathay pacific is undervalued at the moment. all right, ivan su for us. we appreciate your time. we are continuing to wait for news out of cathay pacific as we see that stock as well as swire inific and air china halted hong kong pending inside information being announced. the, hong kong may have led he -- the world last year -- the measures to increase liquidity. we will talk through those next. this is bloomberg. ♪ ♪ today marks one year since the antigovernment protests again in

kong will be hong another challenge cathay has to face.al returning in china and other parts of the world. for cathay and singapore recovery the pace of would be much lower than other airlines because of the nonexistent domestic market. airlines before told us they do not expect travel demand to return to the levels of before covid-19 even 18 months from now. i do not see it happening. haslinda: just to clarify, sources tell bloomberg cathay is set to be mulling fundraising. still to come, it is shaping up to be another volatile time for oil. saudi arabia clouds outlook by announcing it will end output at the end of the month. details ahead. this is bloomberg. ♪ his is bloomberg. ♪ rishaad: we are back, having a look at the latest business flash headlines. oil'sslash jobs, due to recent slump, later to trim down for the transition to cleaner energy. demand crushed by coronavirus rod about a change in the way the company operates. 10,000 jobs in jeopardy. that is roughly 14% of the workforce. mostly in office space roles. chevron and marath

you can look at what cathay has disclosed. billion hong kong dollars per month. this will last them at least a year, this $39 billion. ratenk the cash-bond should come down as we go along and revenue should be picking up a little bit as well as cathay increases flight slightly in the coming months. i think the key point with this recapitalization is also that tohay's net will come down 0.5 times, a lot more comfortable and i think it gives if theyot more headroom need in the coming period. but what about the extent of the dilution that will result from this recapitalization? dilution, wegs calculated to be 39% at least based on the shares being issued. assume that the warrant is fully exercised by the hong kong government, then the eps dilution can go up to 43%. but if we look at the ownership stake, the dilution is actually not that much. hong kong government picking up 6%. air china just marginally from 30% to 28%. changed fromch has the ownership point of view. rishaad: now, the hong kong government would be pointing to obs

cathay pacific, about 50% of its traffic's transit traffic. and there is a huge investment in expanding hong kong airport with a new runway and terminal, so it is about competing in that space as well. that is what this package in this support is about, it is hopinghe hub, as well as and assuming things are back to normal, from both a travel pattern standpoint and political stability standpoint in a few years, although we don't know what is going to happen in those cases. , greatbrendan sobie having you with us, that was sobie aviation's analyst. crime,0 a.m. hong kong that is 12 30 p.m. in sydney, coming up next, ready to play a chinese game, out for -- out with new numbers for his upcoming listing in hong kong. we have him coming up. this is bloomberg. ♪ ♪ haidi: a quick check of business flash headlines. charge to a top shareholder, as china's sweeping security law in hong kong ceo david cummings says he in -- is uneasy about backing the legislation without knowing exactly how it will work. starbucksf china's rival has quit as head of the l

of government will own 6% cathay pacific once recapitalization is complete.neer chesapeake energy is preparing a potential bankruptcy filing. once rival exxon title -- the company amassed incredible debt due to drilling programs that came up with too little. that is your bloomberg business flash. tom? francine? francine: thank you so much. a lot of the focus will be on the better than expected figure out of the euro area gdp. a lot of the focus is not really about the rally, but maybe we have come to the end of the rally. , looking at dollar. tom and i talking about government bonds in the european periphery. they are flipping as the european junk rate increases. --ing up this is bloomberg. ♪ >> good morning, everyone. "bloomberg surveillance." we are having a wonderful conversation on some of the market dynamics out there and it surrounds -- and the surround of this huge rally we see in equities.. you mentioned earlier, the ,ervice equity -- the service there are income statement dynamics. part of this is the balance sheet and part of the balance is costs ne

was there any change in the way that they perceived cathay to do business in the future?rline which does not have any domestic routes, given the size similar to singapore airlines. i think the bailout was a sort this to someto extent. is there a possibility the airline will be changing how they do business in the future? manuel: they will have to look into cost-cutting measures. way to run the airline. truth be said, no one really of these crises. traffic will recover in the nextsix months or in the 1, 2, or even more years, back to levels we have seen pro covid-19. it is hard to project whether the $5 billion bailout will be enough. actually, different companies, -- wiggle room, saying that they may have to access capital markets again later in the year depending on how bad the situation gets and how quickly they can anticipate a recovery. this is a very good first step. deals reporter manuel baigorri with the insight lien on the deal to save cathay pacific. coming up, this weekend, don't miss this. our conversation with secretary paul on the future of the city as it bat

and it is notjust cathay, it is not the only airline to be helped this way. the pandemic has altered travel in many parts of the world and grounded plans. thank you. -- grounded plans. thank you. -- grounded planes. let's get some of the day's other news: the world's second—biggest mobile operator, vodafone, has warned that britain's desire to lead the world in 5g technology will face a big blow if it decides to remove china's huawei from the country's telecoms infrastructure. britain labelled huawei as a high—risk vendor injanuary, limiting its 5g involvement at 35%. debenhams has said it will close another three stores, as the retailer struggles with falling high street sales, made worse by the coronavirus lockdown. stores at milton keynes, watford and gateshead will not reopen, meaning around 300 job losses. it means that, since april, the retailer has said 20 stores will not reopen. injust over an hourfrom now, the world's largest fashion retailer, inditex, will be reporting its latest earnings, which will provide clear evidence of how badly the high stre

to some other business stories making headlines hong kong has ok to $5000000000.00 bailout for cathay pacific the government says it has no intention of becoming a long term shareholder that wants to protect the country's role as a global aviation no one is grounded most flights travel is restricted to cross much of the region. have taken to the streets over museums and restaurants is starting to reopen they say the 2020 season for them is over he wants to see them through to next notch when they hope to resume as back home. at a german air taxi company has joined the ranks of the $1000000000.00 tech startups known as unicorns unit based is valued at over a $1000000000.00 in new funding for the top best buy they give it. one of the united states biggest frack is chesapeake energy is reportedly preparing for bankruptcy monday it's. $180.00 the same time for pics oil deal stock was worth half that tuesday on the latest news companies spearheaded the shale revolution a decade ago making the u.s. the world's top oil producer but the credit crisis has crippled prices. let's talk about that

in the afternoon musicians gather outside his cathay. 2 honeymoon has organized a small you feel constrained the village to have a plan for your. suffrage of which the prevention of them together with the young people he wants to help preserve the local culture that includes the hypnotically rhythmic non-music if you want to be. and then you know you're looking at the back of the. planet the. fact. that. the. people think. this is our control heritage that we want to preserve. we would like to train young people to play modern music also to preserve our traditions. because they are threatened by today's consumerism but also by climate change because it leads to migration not really going to it was. educated. in our music is believed to have its roots in sub-saharan africa a legacy of the black slaves transported along the transfer her and trade routes. with we head south still home to morocco as remaining traditional know their communities but their future too is at risk from climate change. after just a few kilometers a limb stops by a tree. he shows us the skeleton of a young candle which

running after hong kong style cathay used to be an every day event for tom not his true name but now it's let's remember him and many other homeowners living in exile in taiwan is just all in their immunity is to new those at his taipei cafe that have become remedies to ease his homesickness. it reminds me of the days when we used to buy food from cafes like this one during the protests in which initiate joining the march it's a shame that i can't help anymore the only thing i can do is watch the news on my cell phone. last year tom took part in many confrontational protest including stop me the whole legislature and beseeching university campuses he regards himself as a front to them fled to taiwan in december when police began to investigate. i fled because i don't believe that the judiciary will be holding fair trials for example one man who stopped peaceful protest as he was complimented by the judge for court showing noble qualities but we don't see similar comments for the 1st protester he was convicted of rioting just because he was throwing objects i don't trust the judges. b

seeking one and a quarter $1000000000.00 payout to repay debt and restore services in asia hong kong's cathay pacific received a $5000000000.00 bailout from the government after suffering huge 1st quarter losses. middle eastern airlines emirates as he had cattle airways recently announced job losses and pay cuts of up to 50 percent. let's introduce the panel in kenya's capital nairobi rafael coochie special envoy to africa on arab political affairs at the international air transport association in san antonio texas travel and aviation rights have been a wilson and in the spanish capital madrid they go on maida a international aviation law expert as well as an accident investigator welcome to you all let's begin in the spanish capital madrid would you go only don't do you think that easy jet ryanair and british airways have a case that needs to be heard can they take the british government to task over this hello thank you thank you very much yeah i mean when you start all we can hear is that it's absolutely understandable what they're doing because this type of measure the government of laws

cathay pacific with the substantial loss in the first half of the year following this week's bail out. the japanese market was a big turn in the story. the market closing down only by three quarters of 1% we saw them going out of the yen and going into the yen when we saw money go out of the yen supporting the tokyo market off by about 2%. was down more than 3% at one point. the prime minister saying they did expect more in the reopening there. >> to early trade in europe, julianna tatelbaum is standing by in london there >> good morning. european markets have been open just about two hours but it feels longer than that. we opened in negative territory. the stoxx 600 extending the sharp losses we saw yesterday. trading higher around 1% or more the cac 40, the french market leading the way higher 1.6% coming off steep losses in the overall index drops more than 4% the worst daily performance since march 23 pausing for breath and trying to determine where the markets go from here. >> we had seen the trade auto, travel and leisure and banks are on the down side down .3% one of the more d

no word on whether cafe would eventually be affected, cathay pacific, the hong kong main airline. you mentioned the broad rally on wall street. airlines had a great rally. united airlines come alaska, leading in a surge. also on evidence that perhaps air travel is starting to pick up a bit. you mentioned another company that has felt the impact of these growing tensions in hong kong, hsbc. we are finally getting a stance from the agency. stephen: that is right. hsbc caught in the middle. for beingeen blasted static -- silent on the national security bill, not voicing support for them in particular by the former chief executive. hsbc now has come out in support. petition insigned a support of that proposed security law. that wewe reiterate respect and support laws and regulations that will enable hong kong to recover and rebuild the economy. but as i said, it is a delicate position for a firm like hsbc, which generates half of its profits in asia. much of that tied to china. but that is based in london. there is that old saying, in times of trouble you keep your head below. hsbc ha

in two weeks, cathay pacific is adding flights to hong kong and lufthansa is resuming its lights to germanyto social distance. makeup artists have to wear personal protective equipment. actors also have to wear protective equipment, except when they are on camera. there will also be coronavirus testing and temperatures will be checked. individual counties have to approve on restarting production before any work can resume. >>> is 5:57. the uk pulled down a statue right there. it is a statue of a slave trader. protesters in bristol used ropes to take down the statue of edward colson. then they rolled the statue into the river. the statue has been controversial for years. he was born in bristol in the 17th century. he made his money from a company that transported slaves from aframericas. demonstrators also protested outside of the u.s. embassy on sunday, in support of black lives matter. >> you have to support people who need the support right now. i hope someone would be marching for my rights. >> like many states in the u.s., the uk is banning large public gatherings. >>> protesters are jo

i feel like you still have a neutral rating when it comes to cathay pacific.ng at a big dissident is for not doing this? >> unfortunately, hong kong is such a massive global hub that for them to rely on this is difficult. we know their excuse -- exposure to the markets is huge. this will not be enough to boost their revenue back to where it was. hong kong is globally exposed. if there is still covid active anywhere in the world, hong kong will be affected. we will leave it there. thank you. the minneapolis city council pledges to begin the process of abolishing its police force. we will have the latest on the protest in the u.s. next. this is bloomberg. ♪ yvonne: the city council and minneapolis will begin the process of dismantling its police boards after the death of george floyd sparked a wave of anger and protest. rallies continue across the u.s. and the world. andes have lifted curfews president trump as order the national guard out of washington. we have the latest. this is some kind of change. how will they replace the police force? >> it is quite a big

ecb crisis measures as the world bank sees the worst global recession since the second world and cathayline to get a government lifeline in the wake

we saw this during the summer of unrest last year with cathay pacific and other carriers having to kind of acquiesced to the desires and demands of mainland china. so this is being pretrade by the andest clan that hsbc standard chartered bank into british banks have sizable businesses here in asia and greater china and the mainland in particular or perhaps kowtowing to mainland wishes, because hsbc in particular was in the spotlight and they kept their head below the parapet at this time. they have not come out in support oregon against the national security legislation. we got a blasting last week from the former chief executive of hong kong. hsbc was the target of so many protests last summer because it had frozen or closed funds that were raised to support the protest movement. protesters thought they were curbing the rights of protesters to have their constitutional rights. hsbc said that close those accounts for technical reasons. sue, branches were torched we had to facing of that two lines in front of the headquarters. , somewhat understandably, cap there had low, but now they si

anne-marie: so there's a related russian from cathay which i find very interesting.he way we are all working today. and i this removes environment this many of us are working in the states. any advice. i think it is interesting because in some ways, everybody can be seen equally because we are all people but even ways that even harder to assert yourself. cecilia: well i will say this is an interesting question and i'm still recovering covering it. i think the cat box is opened up and created her has created a large change. whether we are having people chime in and participate in ways that have not happened before. it does not feel as risky as speaking up and everybody's attention. anne-marie: and we are participating in the virtual way. cecilia: and in some ways, i think it is creating space. and by using some tools but like anything that i think it also has me an intention on the part of the person that is leading the conversation as well as being part of what your book affirmed is there. because you are more powerful than you think. so there's a two way argument. i