i am tom mackenzie. tom, thanks for that. arguably a pretty big week, rish. datave these slew of china any time loans now from now until tuesday, but at the moment we will see asia and equities returning to close to decade highs. and we will have the jobs numbers on the upside for friday. yes, and of course the dow, nine days, nine record highs, right? incredible. let's look at what is going on and driving the markets in this part of the world. well, take it away. haidi: asia and stocks are gains.g on the morning's equity investors carrying on with what we saw from wall street. we have earnings driving momentum in japan. they are 6/10 of a percent higher. looks little changed. most companies in japan that results i have delivered a beat. in chinese stocks are joining the party. they are up an eighth of a 10th of a percent. shares in changing being led by i.t. and health care stocks. the drop that we are seeing in chinese mining stock seems to be andrsing with a surge material stocks throughout the region

tom mackenzie joining us with the details on that.d out there is no easy win on the issue of trade with china. [no audio] ok, we cannot get the sound up for tom mackenzie. we will get back to him. oh, we have him now. tom? tom: i was saying you will remember trump leading up to the inauguration voiced potential, potentially he was going to slap tariffs of up to 45%. that has not happened. they have been looking for ways, pressure points to put on china over trade. over the weekend, we heard trump will on monday, the u.s. trade representative will consider investigating china over the intellectual property violations as the u.s. sees them. if they take it on, it will carry on for a year, and it could result in tariffs. the other issue was when we heard at the end of the week the aluminum foil products china ships to the u.s. and the fact the administration is looking at slapping tariffs on those. what experts have been telling bloomberg is it is a complex procedure. it is difficult for the administration to hit out or u.s.e tariffs, im

rishaad: tom mackenzie in shanghai., holding steady to the economic factors weighing on the bank of australia. we discussed the cash rate with the commonwealth bank of australia. this is bloomberg. ♪ haidi: this is "bloomberg markets: asia," i'm haidi lun in sydney. rishaad: i'm rishaad salamat in hong kong. let's look at the business headlines. first-quarter operating profits more than doubled to what it was previously.looking for a figure year of about $1.2 billion.shares have been surging in the company since smashedan: homecoming," projections. they also have cameras, streaming, and playstation games. they spent $143 billion on a 95% stake in distributor automation -- funimation. suppliers are trading lower amid concern about potential holdups when it comes to the new iphone. theyy chain data suggests will announce when it comes to oled screens. it could put the initial shipments back to october. rishaad: china's third biggest search engine expecting to launch a u.s. share offering -- worth $5 billion, trying to clo

tom mackenzie joins us from beijing. how much do we know about the new rules? ded to, this formalizes what we have seen in terms of the curbs on at-bat --estments so far -- out ban outbound investments so far. so what the state council did to the end of friday was released these rules to crystallize what has been going on. three different categories when it comes to outbound investment. those that are banned completely, you will not be surprised to hear industries for example this one will be off-limits for outbound investment. in terms of restricted, we are looking at property, entertainment, sports. fewer of the big headline-grabbing deals. the bar will be set higher for chinese entrepreneurs and millionaires, private businesses wanting to snap up english premier league football clubs or production houses in hollywood. some of those deals that are encouraged, those are focused on the belt and road initiative, the presidential back kedrastructure -- bac infrastructure plan. and of course oil and mining. this crackdown on the big-name conglomerates here like anb

tom mackenzie joining us live. arabtech, one of the larger companies in dubai. worth has won a contract 628 million dollars, which is a sizable contract. we did see that series of contracts coming through. last month one came through around $289 million. the stock is down this year. it has been up 21% in the last month. let's get you a bit of a preview of what is to come on the show. we will talk about what is happening with the rba. they are expected to leave rates unchanged today. we will break down the announcement in all of its minutia in 15 minutes. david: the greenback, rather, got the white house blues. flexibility is painting a bleak picture for the dollar. we discuss what that means for the asian economy, next. this is bloomberg. ♪ >> business spirit is the highest and has ever been according to polls. it is the highest it has ever been in the history of these polls. we are doing very well. we have a tremendous group of support. the country is optimistic. i think the general would just add to it. up whenup, business is you look at the markets. chinese p

tom mackenzie in beijing -- tom mackenzie in beijing.ze of chat with the ceo of square jack dorsey later in our program. yvonne: up next, catesla shares have surged. we dig deeper into the economic effects of electric car demand. this is bloomberg. ♪ yvonne: this is daybreak asia. i'm in hong kong. soaringesalsa shares after hours bringing the model three to market. negative free cash flow was more than $1 billion on the second quarter, twice of the first three months of the year. that is less than what analysts had been expecting. tesla spent heavily to roll out the model 3, which is almost half a million orders. yvonne: let's talk more about this and discuss e.v. and what they mean with the energy markets. as head of asia-pacific research and we want to bring in our gaslight columnist from sydney. let's go to first, because all we have been talking about is the model 3. but there is a lot going on in the electrical vehicle market. what is driving the growth at the moment? first i would say that model three has created a significant buz

tom mackenzie joins us from beijing. good to see you.is bodes well in terms of china, or does it? what does it tell us about the current trajectory of growth? a lot can change after a big congress. tom: that is an important emphasis. the economists seem to be around the consensus that this data in terms of the pmi number does flesh out a stronger second-half growth. we have seen other weakness. whether that is industrial profits, the satellite index showing confidence. metal prices picking up. there are a few factors feeding into this resilient strength, things like the european households, store demand there for chinese products. firstonger demand their chinese products. these companies can pay down their debts. things like real estate picture has slowed a little bit less than people expected. a lot of credit pumping into the system to build the infrastructure. one area a little -- one area of little weakness, the pmi number below the july figure it we spoke to one economist at figure. -- we spoke to one economist at jpmorgan. overall,

let's get to tom mackenzie in beijing to break down the china data.en the block numbers in yuan terms, you have had time to digest these numbers. what does this tell us about china's growth outlook going into the back end of the year? >> well, it's not good, but equally, these are volatile numbers, and this is of course only one month. to get a read on august and september before we can reassess. the general consensus view is that the second half of the year, china's growth will be relatively robust, slowing moderately. i will give you the dollar numbers for the exports, 7.2% up for july, misting estimates of 11%. wellts came in up 11%, below the estimate of 18%. the trade surplus around $27 billion usd, which has narrowed somewhat we know that the global demand picture is going to be strong, whether that's from european households or u.s. households, so that should shore up exports in the months ahead. bloomberg intelligence was saying the scope for china's exports are shrinking, numerous saying there could be currency effects, because the yuan has s

tom mackenzie filed this report from beijing. exports undershooting forecast for an 11% increase.ts also missed by a wide margin. china's trade surplus for the month ticked up to $47 billion u.s. economists warned against reading too much into one month's run of numbers. bloomberg intelligence says a longer period of wheat exports -- of weak exports -- u.s. trade sanctions also pose a risk all -- as does any sharp downturn in the equity markets. vonnie: staying on china, beijing's suspicious -- suspicions to back the u.n. sanctions against north korea have cooled trade relations with the u.s.. kevin cirilli joins us from d.c.. what does that mean in reality? the commerce secretary has been threatening imposing new sanctions against china on a host of different industries. they have backed off of those claims. when you read in between the lines, we see china step up to the plate on north korea. we have also seen china dramatically shift the relationship with north korea i not taking as much -- by not taking as much. as a result, there have been pickups between the president as well

tom mackenzie live from beijing. sydney as the company's annual results released this morning. paul allen joins us from perth, a decent set of earnings, profit doubling, writing this rebound .n the price of iron ore double, and that was a miss, analysts were expecting 2.36 billion dollars, but a strong set of numbers. the dividend was expected to rise, $.45, a beat. signal that this might be the time to look at returning money to shareholders, so they have certainly done that. the ceo is $260 million richer. is fortescue --iron ore is fortescue's only product, and the prices been volatile this year. >> that's right. the ceo has described the price as "uncharacteristically high." ands subject to speculation he has suggested that pursue users and consumers have a look at contracts to bring certainty back, but a couple of charts, this is #6104 that shows iron ore exports increasing. milliono expecting 100 extra tons to hit the market this year. consider the in line with this chart, #6103, stockpiles in china continue to

tom mackenzie joins us now from beijing. what are the details of this new deal? tom: it is big.big. of china's merger number one coal producer with one of their top power generators. and will rename this entity call it the national energy investment corporation. in terms of the size, i'll break down the details. , $271 billion worth of total assets. the company would generate revenues that would put it in second place in terms of power companies. of storage capacity, it would be the number one power company, 225 gigawatts of installed capacity, taking it spain, so itor will be a huge company. it was signed off on monday by the authorities in beijing, the merger, and it signals what analysts say could be a new direction for state-owned enterprise reform, so cutting down some of these bloated state enterprises. the suggestion is we will have companies within certain sectors that are going to be merged, synthesizing, and trying to find some efficiencies there, and this is an example in terms of ahead. mergers going there is an expectation we will get more state-owned enterprises te

'stty: again, that was midea vice president speaking to tom mackenzie.iness of online education. we are going to speak to the ceo of a chinese company that is now valued at $1.5 billion. has some big chinese billionaires and a silicon valley venture firms invested in it. this is bloomberg. ♪ yvonne: this is "daybreak: asia ." i'm yvonne man in hong kong. betty: i'm betty liu in new york. let's focus on the booming mixture of education and tax. online education company matching chinese kids with teachers in north america, valued at more than $1.5 billion after a funding round from investors including tencent. joining us from beijing is the ceo. thank you so much for joining us. you have just completed raising $200 million from sequoia, tencent, and others. quite a big expansion for a company that has only been around for a few years. . what is going on with the market? how did you first see this demand? is huge inet demand china, given our population. the market size itself is a $15 billion u.s. market, so we have all this policy, many more kids are start

tom mackenzie is covering the brics in shanghai. rushing off the latest sanctions? g off the latest sanctions? tom: that's right, remaining bullish for russian growth, saying sanctions approved by the u.s. congress on july 25 and sitting on the president's desk would not hobble the growth trajectory for russia. he said it was more about trying europeanhe wings of companies trying to do business with his country and said it was a u.s. ploy. take a listen. >> the u.s. sanctions do not involve russia. european business and u.s. business. relations are becoming worse .fter the announcement made the u.s. is trying to win competition against european companies in different markets. divisioning up the have seen over sanctions, not just between the white house and congress, but the u.s. and the eu because of course we heard from france and germany, their disappointment at the u.s. congress stance because they see french and german business is being targeted, trying to curtail their relations with russia. picture, it is positive. he expects full-year gdp above 2% for russia a

tom mackenzie has the story in beijing. take us through the numbers.stern posting an increase, up 34% for the first half. china southern, a different picture, profits falling 11%. china eastern saying what they want to do now is focus on pushing up passenger yields. they say they would do that by adding more corporate clients and more direct ticket sales. and addedf capacity flights, they will be focused domestically on the top tier cities here. to beger yields tend higher. china southern sticking to its plan to expand internationally, focused on north america, is where ith expects international traffic to pick up 15%. we do have a chart showing chart -- 7941 is that i should say 730 eight, the revenues for the big three state-owned airlines. we are expecting china air results later this afternoon as well. rishaad: why are we seeing a pullback in overseas expansion by these airlines? all about capacity versus yield. in the last few years generally and broadly the airlines have been focused on expanding capacity very aggressively, but passenger yields h

tom mackenzie caught up with the south african trade minister.are you hoping to gain from the next few days of talks here in china with your partners? guest: there's been quite a lot of interaction with officials for economic and trade issues. they've been developing the areas of cooperation that we would be agreeing on as ministers of trade. it was previously the ministers of industry that i attended. all of this will lead into the summit, which will take place next month. i think there is a businesslike approach. a number of very important issues that are on our agenda as trade ministers. reporter: the trade tensions between some of the nations are leaving this partnership between the brics less relevant than it was to be? guest: i think brics remains incredibly relevant at the level of trade and economic relations. it is the most significant grouping of emerging economies in the world. what we are facing now i think is the common challenge that there is this new industrial revolution with a huge change in technologies, digitization, and the qu

tom mackenzie joining us now from beijing. hange and why is there this controversy? tom: it is a chinese firm leading this bed. interestingly, their business here is focused on real estate and sewage treatment plants. what they want to do with the exchange in chicago is use it to help chinese companies list in the u.s.. say think and their backers it would help breathe life into the chicago stock exchange, which deals with volumes of less than .5% of all trading volumes in the u.s. of ipos int listings the u.s. have been falling off over the last two decades, so proponents say it could help boost the number of ipos in the u.s. detractors include a number of representatives in the house and president trump himself, who hit out against this deal on the campaign trail. he has said what you are not going to be able to do is get visibility on the owners of the exchange if they take it over. there is also concerned that could become a place where you than six chinese companies listing in the u.s., imposing a thread on u.s. investors.

speaking to our very own china correspondent tom mackenzie and shanghai.ts, a mixed bag at the moment here it details coming up. plus, the next hour, a former boj board member who was a vocal opponent of governor kuroda. ♪ who knew that phones would start doing everything? entertaining us, getting us back on track and finding us dates. phones really have changed. so why hasn't the way we pay for them? introducing xfinity mobile. you only pay for data and can easily switch between pay per gig and unlimited. no one else lets you do that. see how much you can save when you choose by the gig or unlimited. call or go to xfinitymobile.com. xfinity mobile. it's a new kind of network, designed to save you money. >> from our studios in new york city, this is "charlie rose." charlie: graham allison is a professor at the kennedy school at harvard and the author of "destined for war: can america and china escape thucydides's trap?" he examines the potential for conflict as china threatens to displace america on the world stage. i'm pleased to have graham allison. welc

that is tom mackenzie in beijing on the birth of a behemoth in chinese energy.l talk more about how this plays out in the markets. >> looking at china, we could argue it is showing some signs of shining. china and hong kong indices have been beating earnings estimates this year. returnchinese companies on equity, really improving in the first half. >> correct. china's return on equity has been falling for four consecutive years. the first half, we seem to see that the r.o.e. has stabilized and picked up. one reason is because of largery consolidation, companies. it ties to the merger. when the government wants you to carry out the supply-side reform and ends -- industry consolidations, you -- economicfrom an standpoint, that is the question. >> absolutely. we looked at all of the publicly listed chinese companies in hong kong and we noticed the large companies are growing faster than the smaller ones in terms of sale and earnings. that is surprising because you would imagine smaller companies grow faster. rishaad: because of the consolidation and the point being

tom mackenzie joins us from beijing. you have to say this is down to downstream operations. e oil price around $53 a barrel, up 30% from last year, is a key part of positive results broadly across the three major energy producers in china. sinopec enjoying the others reporting last week was stronger earnings. it is the best profit we have seen in the first half for sinopec and since 2014, net income of $4.2 billion. in terms of the different units of the businesses, the chemicals side saw some strong numbers, profits up 26% because the prices around the chemicals products that sinopec produces have been stronger. 6% outstripping the negatives from the refining parts of the business, profit down around 10%. so it is the chemicals unit in sinopec that has driven the first half profit, and that stronger crude price. the refining part of the business takes in that crude price as the main input, so that is a drag, but it is the chemicals numbers supporting. a strong set of earnings for china's oil and gas sector overall. that's right. petrochina and cnooc last week. petrochina cam

tom mackenzie joins us from beijing. how much do we know? this is policy catching up with reality.ndave seen these curbs they have started to bite already in terms of out founded dealmaking. this is the state council formalizing this, three categories they will be focused on, taking a hands-on approach to overseas investment from chinese firms. completely, banned casinos, gambling, military technology. there will be restricted areas, leisure, entertainment, sports, property. thirdly, the category of outbound deals that will be actively encouraged, deals focused on the health and road initiative, oil, mining, -- belt and road initiative, oil, mining, essentially a question of focusing on bread-and-butter dealmaking to underpin china's national economic priorities, less of the big, headline glamorous deals, and it follows on the extra scrutiny we have seen on the conglomerates here. some of the big private companies have been on a massive buying spree in the last few years and we have seen them scrutinized over bank lending. of this renewed focus on financial risks and the government

that was the investment management president speaking to bloomberg's tom mackenzie in shanghai.uro. ammunition toive traders bearish on the common currency. does the euro have more to run? let us be too julienne with j.p. morgan who is still with us. let us talk about european assets. starting with the euro and looking at this chart. is it time for a break with what we have seen in the euro? has the rally we have seen recently, done for now? >> it does not feel that the euro is overvalued at this level. short-term, the move has been dramatic. some consolidation around those levels would not surprise us too much. the key question is where the euro goes from here. further strength is not impossible because of the strength of the economy. the other question then becomes what does that mean for european equities. our view is that there will be a headwind in the short term. it is an drifting to see how this will play into europe and corporate profits? where does the pain level kick in? some say 120. but some say that is a psychological level. you have german exporters talking about t

tom mackenzie back with us with all the details. not easy to win on the issue of china trade.. you cannot easily pinpoint one area of the china trade environment that will only hurt china and not impact the u.s.. we are talking about the fact that the donald trump administration is considering an investigation into what they say are potential intellectual property violations by china. if it goes ahead, it will take a year. experts, thetrade intellectual property violations -- itigation would impact relies on a hugely complex supply chain. justuld well impact not chinese firms that u.s. consumers and companies. allies of the u.s. that send part of their component into china to be made up to these products. the other area of the trade is looking -- being looked at in washington. attempt.n they are not made a call on this. it is supposed to be a minimal impact. they account for just 3.5% of their total export. have found a new way to reenter the chinese market. what do we know so far. tom: they blocked facebook in 2009. he may have found out they have calledd an out -- app colorf

you so much,hank tom mackenzie, our china correspondent. u.k.t a taste of traditional decor when it came to -- it appeared her host were too polite to say how unimpressed they are with the idea. stephen engle is in tokyo. post-brexit trade deal is going to be a hard sell. stephen: i think it is being a hard sell right now. the japanese are very -- notoriously very polite. plan foray peaches her a proposed post-brexit fta with japan, she wants to model it after the soon to be completed in you-japan trade deal, and the observers we have talked to say maybe the japanese are not too impressed because they cannot necessarily figure out why they would leave the common union there. if are talking about japanese saying the nail that sticks up gets hammered down, they're wondering why are you sticking out and standing up from the e.u.? david cameron himself said the add-japan trade deal would trillions to the u.k. economy. she has an uphill battle. yvonne: and also dealing with cultural side of things in passive aggressiveness. stephen engle join us live

let's talk to tom mackenzie to bring up the numbers about when they are released.we saw the early indication of south korea exports jumping 20%. what are we expecting out of china? south korea is something of a bellwether for chinese exports as well as as you suggest. they will take up 11% in july from around 3% -- 11.3% in june. still marginally low. imports will be expected to increase 18%. we are looking at a trade balance of 45 billion u.s. dollars. we have a chart that shows china's imports and exports over a longer time. you will see that there has been a few dips but in general, particularly toward the end of last year, really high. those imports have been resilient for the past six or seven months. we are expecting further resilience in those numbers today. they indicate that south korean exports were strong. the component is part of the pmi showingks at experts strength as well. we are looking at a stronger global demand picture, whether that is the you -- eu, u.s. or other countries in asia. all of that and these numbers are expected to really solidify th