stephen engle has more from hong kong. >> xiaomi shares fell out of the gate on its ipo. of uncertainty about this company and its lofty valuation, more than apple, facebook, tencent. also, is it a low-margin handset manufacturer, or is it like the chairman lei jun says, a broader internet services company? oh, and also there is the growing backdrop of a trade war between the u.s. and china that has dampened sentiment. the company says it is a tough one to pigeonhole. >> we are a new species. we are in internet company that can do e-commerce at the same time. >> xiaomi is now a $50 billion company, the third largest in the world for handset manufacturers, but a far cry of an earlier estimate last year of a valuation of $100 billion. the size of the ipo also scaled back, down $3.1 billion from an initial estimate or aim of $10 billion. one dampening prospect was the elimination of a corresponding listing in china in shanghai of a cbr, china depository receipt. even the regulator in china shared concerns about the lofty valuation and true nature of ts business. emily: here

and i'm stephen engle.acking the opening minutes of the debut of xiaomi and it is trading lower. this is bloomberg markets: asia. making aaomi are miniature debut. we are seeing that stock now extending declines in the session. we were talking about a 100 and other valuation. david: they scaled it down and it is falling now. apart from the confusion surrounding the valuation, do you believe in the vision for $30 is the price target here, very interesting. how broaderok at markets are trading, sophie is here with a fairly good session. >> not bad this monday given the gains we saw on friday. gains in the china market. 1.6%.ong gaining japanese stocks also gaining ground for a second day. we have the dollar down about 0.2%, extending losses to a near three-week low. check out the yuan. gamenshore rate, best since april 10. a quick look at some commodity moves. we have cover on the move, rebounding after the worst four-week rout since 2011. cover gaining along with aluminum as well. take a look at xiaomi. the

cfohat was xiaomi's speaking to stephen engle and hong kong.,rning now to the cfo trying to dispel concerns that a crackdown will impact company growth. shares fell 10% monday after a washington post report that the rate of suspensions had more than doubled. afterock compared losses the cfo tweeted, "some clarifications. most accounts we remove are not reported in metrics because they have not been active for 30 days or more or they are never counted." joining us is selina wang. what is happening? >> a delayed overreaction on the part of investors. it confirms what twitter said themselves two weeks ago. i reported they are tripling the accounts they are identifying, so about 10 million accounts every week. they are stopping more than 50,000 spam sign-ups a day. this will have a marginal impact on monthly active users because most of these automated accounts are not active every day, every month. in addition, a lot are stopped before they join the platforms of they are not counted towards is metrics. emily: that is a lot. iswhat should be concer

paul: that was silk road associate founder speaking to bloomberg's stephen engle. bring in asia's society vice president wendy cutler. she's a former acting deputy trade representative and says to negotiating association -- says negotiating a solution is possible. and there's a suggestion u.s. and china might resume talks again. forgive me, this sounds like deja vu all over again. we were here just earlier this year. what are the chances we see the rhetoric ratcheted up again? seen such strong words and actions from both sides. and secretary mnuchin indicated talks may proceed. [no audio] it's inevitable. what comes at a surprise is the attempt of a back-and-forth, and the volley on tariff increases. kind of order for some solution to happen, i understand you think more economic fallout actually has to happen. how bad does it have to be? wendy: i don't think it has to be terrible. ramy: we don't want it to be terrible. wendy: exactly. [laughter] i also think at this point, the $34 billion of tariffs increases went into effect less than a week ago. people are not fe

stephen engle is following this. what went wrong with xiaomi? t didn't go right is the right question because there were a lot of questions just as they were finalizing the ipo. the biggest question is how do they justify such a lofty valuation, valued xiaomi at twice that of apple? a lot of investors were asking what is xiaomi? the founder said we are an internet services company a la facebook and others that can justify it lofty valuation but a lot of investors go, you get 80% of your revenue from smartphones. you are a lower margin smartphone maker that deserves a lower valuation. it is something the regulators in china questions. they had 84 very strict questions of xiaomi as xiaomi tried to have a corresponding kind of depository listing along with hong kong. that has fizzled out. at the end of the day, the ipo came in below expectations. they are expected to raise $10 billion u.s., came in at $3.1 billion. so it is coming to the market today to trade on day one, bit of a wounded bird. this is a company that did have quite a dramatic turnaro

bloomberg's chief agent correspondent stephen engle reports from bejing. stephen: xiaomi's decision to postpone a simultaneous listing in shanghai with its hong kong ipo could hurt china's ambitions to lure its larger tech companies via china's depository receipts. the hong kong ipo is said to be the world's biggest in nearly two years to raise $6.1 billion u.s. dollars. but it is a considerably shaved , down offering that was expected to top $10 billion, and the company's cfo says there is no timeframe to revive them at -- revive the domestic part of the listing. sources say xiaomi scrapped it because of differences with the valuation but , xiaomi says it had no dispute with the csrc. investors may dispute the valuation. the ipo is said to be marketed up to 29.3 times forecasted 2019 earnings, making it twice as expensive as apple and more pricier than tencent. xiaomi says it deserves the premium in valuation because it sees itself as an emerging internet and e-commerce company rather than simply a lower margin smart phone player. the ipo likely begins tra

stephen engle, bloomberg news.ly: and we go into the debut from every angle. >> they have a lot to prove. they are very localized in china and developing markets like india. but that is just one portion of the world. there is obviously the trade war tension and the ability for hardware makers together devices in the u.s. and europe is increasingly difficult. emily: shelly banjo also joining us right now. how much of a disappointment is this? it is big, just because of how much expectations were built up. if they had come to the markets. was a bigwere, it compliment for what they were able to do. becoming one of the world's biggest smartphone companies. they did not just rest at that instead of saying this is who we ,.e what we make, we are this $100 billion company that is an internet businesses. that is where the mismatch lies. emily: i just want to point out the ceo is an investor in your fund. would you be a buyer? >> i am. emily: at twice the price of apple? >> i am. [laughter] the business is underestimated an

bloomberg's chief north asia correspondent stephen engle has more from hong kong. ephen: xiaomi shares fell out of the gate on its ipo in the hong kong stock exchange. a lot of uncertainty about this company and its lofty valuation, that put it more than apple, facebook, tencent. also, the true nature of its business. is it more of a low-margin handset manufacturer, or is it like the chairman lei jun says, a broader internet services company? oh, and also, there is the backdrop of a growing trade war between china and the united states that has dampened sentiment here in hong kong. the company says it is a tough one to pigeonhole. >> we are actually a new species. we are in internet company that can do e-commerce at the same time. i don't think there is anything like us. stephen: on the one hand, xiaomi is now a $50 billion company, the third largest in the world for handset manufacturers, but a it's a far cry of an earlier estimate last year of a valuation upwards of $100 billion. the size of the ipo also really scaled back, down to $3.1 billion from an initial est

stephen engle reports. stephen: xiaomi's decision to postpone could lure its larger tech companies via china's depository receipts. the hong kong ipo is said to be the world's biggest in nearly two years to raise 6.1 billion u.s. dollars. it is a considerably shaved down offering that was expected to top $10 billion in the companies cfo says there is no timeframe to revive them at the part of the listing. sources say xiaomi scrapped it because of differences with the regulator overvaluation, but xiaomi says it had no dispute with the csrc. investors may dispute the valuation and the ipo is said to be marketed up to 29.3 times forecasted at 14 earnings, making it twice as expensive as apple and more pricier than tencent. xiaomi says it deserves the premium in valuation because it sees itself as an emerging e-commerce industry rather than a smart phone player. ipo likely to get playing july 9. emily: coming up, the travel bans impact on silicon valley. and if you like bloomberg news, check us out on the bloomb

let's bring in our chief north asia correspondent, stephen engle. bout these ambitious targets but also the price tag. stephen: this could cause up to $5 billion. tesla has been burning through a lot of cash back home and ramping up capacity for the model three and all those other problems. billion could be needed in an external funds and also debt refinancing until 2020 to handle all these ambitious plans for tesla. muskw, we knew that elon wanted to and kind of had to go into china. for the last year they been trying to work this deal. they signed a memorandum of understanding with china in shanghai for the new factory that could have cars rolling off it in a couple of years, in heating the capacity target of 500,000 a year within two to three years after that. so about a five year time frame. and elon musk is in beijing today, we understand, probably meeting a lot of different people on how to get this going smoothly. past u.s. automakers coming to china had to have a 50-50 joint venture. this is a wholly-owned subsidiary that tesla will be settin

let's bring in stephen engle to tell us -- stephen: it is something tesla and elon musk have been lookingfrom within a year. the timing is very interesting. tariffs include auto-parts and batteries from china. this is clue something elon musk wanted to do. you mentioned having to already raise prices by 20% this year. wasuse again, all because sold in china are important. we're looking at first quarter sales in china, because prices have gone up to have fallen to 50% of total global sales for tesla -- for 15% of total global sales for tesla, and that was even before the tariffs. was 30%. -- before it what are they going to do? they signed a deal for a memorandum of understanding to set up a factor in shanghai within a couple years to produce upwards of 500,000 vehicles. the first one is targeted to roll out of the assembly line in a few years. rishaad: it is a moving target. they have been so bad at getting their targets. stephen: this is a move by tesla to go in after china reduce the barriers for entry. says it could cost $4 billion to $5 million. tesla already burning through cash with

the ceo spoke to stephen engle. >> you followed many ipos. alibaba. all the big ones. rst ipo, they convinced the investors of imports of the company. stephen joins us from hong kong. you've spoken to some of the earliest investors of xiaomi. are they in for the long term? >> they are in for the long-term, of course. in a lockout. for 12 months so they don't want to talk down the stock. i asked them if they believed in the chairman's vision that they are not just a hardware play. this company started with online sales of cheaper smartphones, i should say less expensive because the quality was fairly ok. they get 80% of their revenue from hardware but the chairman pitched in this ipo and his pitching the company as an internet company. internet services in the most recent quarter accounted for just 10% of revenue. said they are internet company and should be valued as an internet company like facebook. this is a rich valuation and that's why the stock has been down. ipoas not gone above the price of $17. not as bad as the gray market had indicated might do but still down

stephen engle and there, thank you so much. york, -- englander, take you somewhat.is bloomberg. ♪ berg. ♪ scarlet: let's get a recap. the dow is adding almost 100 points, the s&p 500 gaining attend the 1%. the nasdaq is hovering near record highs. julie: on a closing basis it is there. scarlet: so little changed on the day. the president-elect is getting a visit from an all-star delegation. we are from mike pompeo next. -- we hear from mike pompeo next. 2, down. back up. our phones are more than just phones. they're pocket-sized personal trainers. [ upbeat music playing ] last-minute gift finders. [ phone chimes ] [ car horn honks ] [ navigation voice ] destination ahead. and discoverers of new places. it's the internet in your hand. that's why xfinity mobile can be included with xfinity internet. which could save you hundreds of dollars a year. it's a new kind of network designed to save you money. click, call or visit a store today. mike: i'm mark crumpton the first word news. president and mrs. trump has arrived -- have arrived in scotland will they would spend t

let's get to stephen engle who has the story for us. me back from vacation and things are kind of the same? stephen: nothing has changed as far as moving the goalposts. whatever sports analogy you want to use. the rhetoric is ramping up. there are no official talks or negotiations scheduled. neither side is saying they're going to initiate talks. yvonne: and you think after the the meeting we have a little more leverage president trump. stephen: perhaps, but chinese officials we have been talking to remain anonymous are saying we will double down as well. we will be in this for the long haul. geneva is the latest platform, the wto where they clash. that is the headline word. but he wto official says a work white diplomatic and constructive talks, but the -- the room was filled out. commentssome of the coming from the two sides. , thehinese officials ambassador saying extortion, distortion, or demonization does no good to resolve issues holding our feet to the fire has never worked. that's been the thing for the chinese. they are not goin

we've got to leave you there, stephen engle our chief north asia correspondent.we have a look at a commodity market continuing to ise. and a round table later on in the show. coming up next a week of risks. michael levin of credit suisse tells us how the first wave of tariffs from the u.s. to china could be affecting all your investments. that's coming up next. ♪ david: this is bloomberg markets asia. now this, when you look at the treasuries market, big conversation happening there. long end of the curve stalling. the u.s. 30-year kwleeled after struggling to break some critical levels. today could bring a key number of risks. you have tariffs kicking in on china. latest payroll numbers as well. let's put all this into context. have a look at this chart. it takes the 10-year all the way back to the late 1970's. we've seen a bull market in that span as well. you have the full averages. you have the 30-year average in green. 20-year, 10-year average, we're a little above that, 2.5% is the past 10-year average. what does an investor do when t's started to turn. wha

ramy: all right, great stuff, stephen engle, thank you so much. let's do a quick market check. far behind it, down by about .1%, yvonne. yvonne: futures looking pretty positive as well. singapore is the one to watch, a one-year low. this is bloomberg. ♪ this is bloomberg. ♪ >> asia-pacific market tracking street. wall china appearing little -- they are open for talks. beijing slams washington's logic.r president trump saying brexit would kill any u.s. trade deal. salamat in hong kong. markets.loomberg

coming up on bloomberg, stephen engle under his joining us. standard chartered bank. at 9:00 a.m. in new york. this is bloomberg. ♪ taylor: this is "bloomberg surveillance." i am taylor riggs. comcast has given up the fight with disney over by the 21st century fox asset. they had considered a partnership with private equity firms. brian roberts could be open to buy just some of the fox assets. lyft is joining the bike rental business. it is purchasing the operator of city bike in new york and other major u.s. cities. last month, the two were discussing a price tag of $250 million. uber bought electric bike start up jump bikes in april. kids across the u.s. are not the only ones feeling the absence of toys "r" us. so our retail landlords. most since 2009. the company is now in bankruptcy proceedings. that is your bloomberg business flash. tom: thank you. you can rip up the script with deutsche bank about every eight hours. it seems that every eight hour point, another body walks out the door. let me bring it on the bloomberg. this is the actual screen we see. this is o