cathay pacific posting its first loss in eight years. aming cost and competition from china. chief executive, that they pacific is asia's worst performer on the bloomberg world airline index. chinese premier li says the country will experience further friction as it continues to open up its economy. he has been speaking at the conclusion of the national people's congress. he began expressing optimism with ties with the united states because of the one china policy. he said beijing does not want a trade war. >> china -- u.s. relations have been going forward. i am optimistic about the future of this relationship, no matter who gets elected. u.s. secretary of state rex tillerson arrives in japan later wednesday for a three nation tour of asia that will offer clues to the trump ministration agenda. also with concern of u.s. protectionism. tillerson will go to seal and beijing, where he is likely to discuss a presidential summit. representing workers at a coppermine has pushed the boundaries of tolerance by burning the company's latest offer

theie: hong kong with biggest advance, up 1.4% despite the drop in cathay pacific. followed by taiwan and malaysia. .upport for the taiex we do have chinese stocks rising for a fourth day here, led by minors and industrial stocks. i also want to look at what is going on with the hang seng here. given that property stocks are in focus following the fed rate hike, real estate up 1.5% here. hong kongpected as raised its base rate. authorities say they need time to observe the impact on the property market. is going onat what in the currency space, the south againston up over 1% the dollar given that dovish fed outlook. the taiwanese dollar rising the most since may 2015, and the southeast asian currencies joining that tide of strength. the ringgit at its highest level in five weeks. the offshore yuan falling .2% ahead of that fomc division -- decision. we saw volatility falling to a 16 month low. oursingaporean dollar, editors are saying this could be the signpost for asian currency bulls. when you look at the greenbacks decline against the singaporean dollar, there is

i am still confident and cathay pacific.that the worst is over for cathay pacific, saying 2016 was the worst year and things will improve. no plans to change there stake holding in cathay pacific. fromhina also benefited the weaker oil price last year as well. in terms of expansion plans, they outlined plans to buy 155 new planes in the next three 50% foroughly between airbus and boeing, introducing new routes between shanghai and barcelona and beijing and zÜrich, to take advantage for the increased demand for business travel between china and europe. haidi: this aggressive capacity seems to be continuing for all the chinese airline's. what are the risks they are potentially facing here? the oil price remains a risk, a key risk a, according to analysts, as does the continued renminbi weakness. we spoke to peter hartman sent from the aviation center, and he outlined some of the key risks facing china's airlines. take a listen. getting ustailwind from low fuel prices, that inherently has a risk. encouragesl it capacity into ma

free market, cathay pacific has not moved. story, heading for its biggest loss in eight years, the biggest losses the global financial crisis. the three years the chief executive has been in charge of this carrier, he has seen the stock become asia's worst performer on the bloomberg airline index. to reassure people things will be working out all right, a turnaround as well, three times that cathay pacific has made a loss. that chart reflecting the share price and looking at the bottom bit indicating whether it is oversold or overbought. rsi indicating overbought, but not up to that redline, which would set off alarm bells. more from money market rates. haidi: that's right. fixing comen through today, but this note from the standard chartered saying as soon as we get a move from the fed, the pboc will move to tighten money market rates. they are expecting a 10 basis point rise in money market rates after that fed increases rates starting with the open market reverse repo rates and short-term lending facilities. they are expect

very quickly, dine—on—demand app for cathay pacific.ake up lost ground. in the emirates, you have the bharat the back. can they rival the emirates and other carriers?|j the back. can they rival the emirates and other carriers? i am being buzzed that we are breakfast ready. we will see you soon. we will see you soon. goodbye. good evening. we've got a lot of largely dry and pretty mild weather on the cards for much of the week ahead. but, with clear skies sunday night, monday morning starts on quite a chilly note. it's not a bad day, though. it's looking mainly dry, and many of us will see some sunshine around too. the front that we saw on sunday that brought cloud and some drizzly rain clearing away towards the east and we've got this area of high pressure building in from the south—west. that's going to be dominating the weather through the next couple of days. so first thing monday, temperatures five or six degrees in most of the towns and cities, but it's certainly a chilly start to the morning in more rural spots. northern ireland,

theie: hong kong with biggest advance, up 1.4% despite the drop in cathay pacific.nd malaysia. .upport for the taiex we do have chinese stocks rising for a fourth day here, led by minors and industrial stocks. i also want to look at what is going on with the hang seng here.

cathay pacific has been fined 51 million dollars by the european union for antitrust violations.arrier said the fines relate to cargo surcharge levels that the eu says breached competition laws. week, cathay pacific announced its first annual loss in eight years and will cut senior and middle management levels by 13% and is reviewing the eu ruling. dalian wanda group partnering with ibm, allowing chinese businesses to have access to its cloud infrastructure and language services that allows customers and consumers to talk to apps. yvonne: transactions in southeast asia expected to improve. share sales and offerings are ,ikely to come from industries however geopolitical issues in europe, the u.s., and volatile commodity prices could affect the positive outlook for the year. china's home prices rose in more cities last month despite tight curves on transactions. the outlook for property in china, we have the chief economist at anz. home prices now regaining speed after four months of declines. let's throw out the chart and show the trend between the first to come a second, and thi

if you see an increase in stakes in china, could this impact the likes of cathay pacific, chinese carrierse carriers having a stake in the hong kong carrier? hong kong airlines has a large codesharing deal with cathay. if you see american airlines trying to shift some of that traffic to china southern and a stronger relationship between china southern and cathay, major competitors, i cannot imagine cathay will be happy with that. major competitors, i cannot imagine cathay will be happy with thatm other news, korean technology giant samsung has revealed plans to sell refurbished versions of the galaxy note smartphones pulled from the markets due to battery issues. they took a huge hit over the trouble from the note seven. samsung said it will choose which markets to sell them after discussions with red tory authorities and airlines. —— regulatory. brazil's administration has ordered three more meatpacking and processing facilities to close, bringing it up to six, after risks of contamination. import suspensions we re of contamination. import suspensions were lifted recently, though they are

up next, cathay pacific experiences antitrust turbulence. details ahead.is bloomberg. ♪ ♪ ramy: a quick check of the latest business flash headlines, deutsche bank expects to raise $8.5 billion after posting its new shares sale. is 690 million new shares at $12 a piece, 30% discount from the friday close. changes oned the march 5. the ceo reversed strategies after saying he did not want to cap shareholders. this group is entering the cloud business by forming a partnership with ibm. ibm will introduce the one sentence -- computer services to the mainland, allowing chinese businesses to have access to cloud infrastructure and language services that allow consumers to talk to apps. other watson things are planned as it evolves. ramy: cathay pacific has been antitrustmillion for violations by the european union . it relates to cargo surcharge levels, which they say breached competition laws. they announced their first annual loss in eight years last year and say they will cut management level positions by 30%. it is reviewing the e.u. ruling. haidi: we will l

david: rosalind chin on this preview of earnings for cathay pacific.kets down 3/10 of 1%. ♪ kong.is 11:29 in hong i am paul allen with the latest first word news. donald trump's taxes back in the news from 2005. he made $150 million and paid $38 million in taxes, which is an effective rate of 25%. it matches a document from msnbc. he took a write-down of $103 million of that year. the white house said it is illegal to steal and publish someone's tax returns. it willli keqiang says face further friction as they try to open their economy. he has been speaking at the conclusion of the national people's congress. he expressed optimism about ties with the u.s. and the one china policy. beijing does not want a trade war and chinese investment created one million u.s. jobs last year. china-u.s. relations have despite theorward, twists and turns over past decades. i am optimistic about the future of this relationship, no matter who gets elected. the european union may force the u.k. to wait until june 4 brexit negotiations, despite prime minister theresa may s

cafe is in hong kong. -- cathay pacific is in hong kong. it is not really a western airline..a thank you so much. bob crandall, former ceo of american airlines with us on the line. oil producers talking about output curbs being expended in, we will have talks had potential market implications. this is bloomberg. ♪ ♪ betty: good morning, i am betty liu in new york. haidi: i am haidi lun in sydney. you are watching daybreak australia. independent oil producers and opec members are looking at extending the draining of the blood. -- glut. there are conversations with kuwait, saying it should be another six months after the current program concludes in june. looking at the situation now, here on set. it is a given that they need to extend. >> absolutely, the markets call for it, and there is in patients when we continue to see building inventory and growing u.s. output putting pressure on that market, not getting i suppose the high-frequency data like the rest of the globe. the opec under -- production cuts are supposed to do the bulk of the heavy lifting. i think basically the ma

firstly you have hong kong's cathay pacific, holding 80% in flag terrier air china, while delta airlines015 —— carrier. —— airchina. in china eastern in 2015 —— carrier. —— air china. disproves the mainland market is becoming important for many of the global carriers. absolutely. —— this proves. we will see you again soon. south africa's finance minister is due to arrive home in the next few hours after he was urgently recalled from a meeting in london by president jacob zuma. the move has fuelled concerns there may be a cabinet reshuffle, which analysts say has unnerved investors, who see pravin gordhan as an emblem of stability. the eu's health commissioner says brazil needs to restore trust in its meat exports after being hit by a scandal over rotten produce. a number of countries have slapped restrictions on brazilian imports. the country has seen its daily meat exports plunge by 19%. the company that built a controversial pipeline under native american tribal land says it is now full of oil and will be in operation soon. construction of the stretch of pipeline in north dakota was de

a story in marked contrast to cathay pacific. this has all been boosting these companies ultimate lines, so we might reflected in the earnings statement. we will see how they open and find out what is going on. here is juliette saly. >> a mixed picture coming through. china and hong kong opening up her to hong kong higher by .1%. 300 down by .1%, adding to this next picture across the board. on this strong surge, the asx at a two-year and part ofe .4%, that is due to the commodity picture. we have seen crude oil continue to extend its surge. that is helping those energy players today. we are seeing copper higher by , and auminum up by .4% good gain in steel as well. a switch out of gold, not function, the gmm but an indication we have investors not to worried about risk. we are the stocks watching, lg electronics having its biggest drop since february 27. trading boy them is double the 30 day average. it is still falling, a day after samsung launched its new phone. takeda pharmaceuticals up, it's vaccine has triggered immune

some laggards, cathay pacific not moving yet.s rising for a for the day, the stock was cut to neutral by j.p. morgan with a kong target to 63.20 hong dollars. wharf is leading hong kong real estate stocks, outperform the hang seng property index with a 35% return year today, followed by china resources. later, we will find out why a kong'sinst hong billionaire property tycoons may not be the savviest way to go. rishaad: let's get back to our guest. we were talking about emerging markets. you are in favor of them at the moment. valuations as you have been alluding to are rather compelling, but when a stock is cheap, it is cheap for a reason, so you have to tread carefully, haven't you? at thee are looking cheapest price-to-book violations in emerging markets since 2003. there have been reasons for that. we have seen 23% absolute ebs reductions since 2011. aw we are looking at rock-bottom price to book by ua she combined with the resurgence of economic growth, a resurgence of corporate pricing power, ppi, translating to stronger ea

a story in marked contrast to cathay pacific.l been boosting these companies ultimate lines, so we might reflected in the earnings statement. we will see how they open and find out what is going on. here is juliette saly. >> a mixed picture coming through. china and hong kong opening up her to hong kong higher by .1%. 300 down by .1%, adding to this next picture across the board. on this strong surge, the asx at a two-year and part ofe .4%, that is due to the commodity picture. we have seen crude oil conti

cathay pacific has released details of its turnaround plan after reporting a loss. costsntend to cut staff by 30% at the management level. details will be announced in june. rex tillerson wants a new approach when it comes to north korea. he said years of trying to persuade pyongyang to abandon the nuclear program to -- tillerson is now flying to china on the weekend. news 24 hours a day powered by 2600 journalists and analysts in more than 120 countries. a quick check on the market. we are entering a lunch break in hong kong. 10 sent, record high. this is bloomberg. -- tencent, record high. this is bloomberg. ♪ >> welcome to the best of bloomberg markets: middle east. week,a big stories this oil went on a roller coaster ride as output increased. winningdent trump praise from saudi arabia's ruling family. made news with shares hitting highs on merger talks plus the diplomatic row between turkey and the netherlands escalating. president erdogan steering the controversy by calling the dutch fascists. you can stop our foreign ministers plane all you want. let's see how

looking at some of the companies that gained despite having sell ratings, despite -- , itexample cathay pacificthan 10% this year, outperforming the hang seng index despite having sell ratings. falselly is based on optimism from investors, and us soon as they see the reality of the earnings, it will be stripped out. , where analysts have reiterated their position. rishaad: the question will be what are people saying about the trend? does this go on? reporter: if you take a look at the longer-term view taken a these are higho, rated companies that have performed. speaking to people, a lot of them don't think the current trend will continue for that long. it is a short-term market pattern. it could be that people who missed the opportunity to get into the rally are now looking into opportunities. rishaad: thank you. into the a transition china and hong kong markets. what do you think about these stories? the ones that are should be driving the hang seng. .t must be a bit of a headache >> we look at this very closely. we are having a bull market rally. macro is improving, inflation is coming that.

cathay pacific rising strongly, up around 5%.ement in korean stocks showing tension one would say, the understatement of that year, in terms of the korea-china relationship. versushe aussie dollar the new zealand dollar, now the highest level against the kiwi on the back of data out of australia and new zealand this morning. let's get you this story coming out of dubai. loserswere the biggest on sunday, falling to the lowest level in two months, on the same day that the nasdaq dubai launched an etf platform. with his etfrt off story before we get into dubai volumes going to sleep. how would the spring momentum back into this in terms of people looking for proxy trades? to say that this is an intention that goes along well with all of the different tosures that stock exchanges bring liquidity and percent investors alternatives that they can have to have exposure to stocks in the region, so etf's have never been very popular among investors here in the uae, but the authorities and stock exchanges are doing everything they can to pr

cathay pacific has released details of its turnaround plan after reporting a loss.to cut staff by

cathay pacific, for example.is up more than 10% come out performing the hang seng index, but a note this month said this rally is based on false optimism and once investors see the reality of earnings, then it will strip off that false hope. a similar story with singtel, but analysts have reiterated sell positions. david: i'm guessing the trend is not expected to continue? >> if you go back a couple of years, the highly rated companies have been the out performers. speaking to people, they say this is a short-term market pattern, and it could be that people are looking for opportunities and trying to get into household names that have lagged, which are not the analyst consensus stocks. david: great story there. the most unloved stocks feeling the love. so far, it has been the opposite. let's check other markets across the region. hong kong, we will talk you through what is happening in that market. flat, 57 53 on the asx 200, down. that's not bad. homeless and even split when you look across that market. let's lo

we have the one world partnership with cathay pacific, and we fly directly to beijing and hong kong andourselves. we have adjusted to flying from bases in singapore and japan into greater china. we are very big in the free trade agreement between australia and china. this allows us to transport fresh milk each week, 50 pounds -- 50,000 liters from tanzania -- from has mania. mania.m tas there are business passengers, and we take it to market with world partnerships that we can take advantage of into the future. david: that was the qantas group ceo alan joyce. ? ery: how many hikes we will plot the dots and try to make a course for the fed. this is bloomberg. ♪ ♪ the market was a little exuberant for a slightly more aggressive fed, and you saw the movement in the bond yield coming off in the u.s. dollar quite substantial moves down to the dollar. in response to that big decision. gradual, 75 for the fed, 75 this next year. that is our rate. >> the markets were expecting they would take out the word gradual, because that is how they have been describing the pace of increase. they left it

cathay pacific now of 5.8%. david: very nice. 12 box a pop. -- $12 a pop.ying out his plans. let's get it over to beijing, where tom mackenzie is standing by. we have been trying to digest the top targets unveiled by premier li keqiang yesterday and his work report. i'm joined by the chief c, china'sat cic most influential investment bank. let's start with with that gdp target of 6.5%. how realistic is the chinese government can hit that target by the end of the year? government and international community this year have more confidence they will be able to reach that target and probably surprise on the upside. look at the global environment, global growth, it is in much better shape now compared with a year ago. shoulde export factor give investors a little more confidence because it reached the target. key challenges facing growth? we have domestic challenges and external challenges with protectionist sentiment that premier li keqiang mention in his work report as well. isthe way we see it is there the old economy and new economy. i think this rebalancing

and cathay pacific in hong kong -- jumping up over 4% in late trade. we are having a look at samsung, particularly this chart. this is essentially target price of of the stock, going back to march last year. you can see not once is it in the red. we a continuing to see 90% of analysts say this stock has a despite themsung fact that everything we are seeing from samsung, the advised chair being arrested last month. anna: juliette, thank you. juliette saly in hong kong. let's turn to the banking story, a big story in europe. deutsche bank announced an 8 billion euro share sale, among other measures, as john cryan start a new strategy. he gave the green light yesterday to selling a piece of his asset management business, naming two deputy ceos, and scrapping the sale of its consumer banking unit. matt miller has more for us from berlin. good to see you. what's the most significant change here? certainlyacktracking, a change in strategy coming through from john cryan. matt: yeah, exactly. he's saying this is not a step back to what they already had at the

david: cathay pacific has been fined $61 million by the european union for antitrust file relations.charge levels, which the eu says breached competition laws. the airline announced its first annual loss in eight years last week and said it will cut mid to senior management levels -- salary levels, by 30%. it said it is reviewing the eu ruling. enteringe dalian wanda the cloud business through a partnership with ibm, allowing chinese businesses to have access to its cloud infrastructure and language of that allow consumers to talk to apps. david: welcome back. i'm here. guests here as well. we were talking before the break , we don't know why these markets continue to go up. cloud of uncertainty is trade protectionism. it is hard to quantify the impact. when president trump meets president xi jinping, is there anything you expect them to do that removes the uncertainty? to seere all waiting what will come out of the meeting, but the best case scenario in a realistic set of probabilities as we kick the can down the road and the uncertainty lingers, but the status quote lingers with it

havey pacific shares dropped after the company loss.ed its third asia's largest international airline posted a net loss of 74 million u.s. dollars for 2016. cathayped plans for a second half dividend after competition from chinese airlines and losses from fuel hedging dented its earnings. several executives are said to be leaving active capital management after it suffered inhdrawals of $13 billion the past 13 months and shares dropped. according to people with a top equity analyst drake, compliance officer. comment.lined to none of the others returned calls her a is seeking comment. and stock is slump -- has slumped, exiting the drug maker at a loss. the shares are down more than 90% since their august 25 date. dropping 10% in new york. the bonds decline to their lowest since december. that is your bloomberg business flash. anna: thank you. let's check in on the market action. the pound is on the move. oil has been volatile. >> good morning. there is a lot for investors to digest today and this week and that is transmitting to a bit of caution on the markets. we look at equities in asia seeing a little bit of muted trading. a little bit of a we

“ from cathay pacific. latest numbers from cathay pacific. they are back in the red.details in a moment. it's the day global markets on tuesday, the us federal reserve started its two—day meeting and is widely expected to raise interest rates when the meeting ends on wednesday. fed policymakers are tipped to raise interest rates by a quarter point, and it won't surprise markets, they've already priced this in. as ever, the devil is in the detail. it's what janet yellen says after the meeting analysts will scrutinise for clues about how fast rate rises will come going forward. and the fed may talk about reversing a key part of its financial crisis recovery plan, to reduce its $1.76 trillion holding of mortgage—backed securities — these assets were bought at the height of the financial crisis in 2008.