A look at these currencies, hich we appreciate the dollar, as we do have dollar weakness. Lets get to the hang seng. Its beating all the worlds major equity gauges this week barish thing. This this isnt necessarily a death ross, its a 50 day moving average, rather than the hundred day one. 200 day line but quite often does proceed market declines in the past and investors arguably may be about too optimistic next weeks meeting between xi donald trump. There could be an overreaction to the current position with that. To hang seng giving up some of the guns but not by much. Well see what happens. Ets get more on the markets right now. A good one from our global editor. Cs and policy kathleen is with us. Lets start with you. Aid is more of dove for markets to drink . I think the oomph, the push jay were seeing from powell and the fed, its running its course a bit. Know, 10year treasury yields fell to 2 and pushed below a little bit but i also noticed they are failing to hold below 2 so it looks like the treasury market rally is running out of team a little bit, little bit fatigued. Again, the s p 500, at a record high. So much of the rally in stocks has been built on the idea that is fed is going to ease, fed going to add stimulus, you know, and now we need to wait for the that do just the fed hasnt cut at all yet. Me that the o decline in bomb yields, you know, is probably going to pause will take nd that some of the wind out of the stock market. Further, y let it go things could get even more negative, you have to say, has too far, maybe, are eople going to like reassess risks d steady, or are really rising. Lets go to this chart. Economist on n wall street. If you see this chart, what it 10year yield is now feds fund rate. The point made earlier, when you et these kinds of inversions and they last too long that could calm the recession. This is one of the reasons why so much expects the Federal Reserve will come through with that rate cut thats so to other Central Banks, because there is a 75 basis points gap he thinks by the endher reason f the year well see that 75 basis points of cuts from the reserve. Up. His keeps popping or what is the possibility that it could become that e war cloud, damage weve seen in exports is such a reason. Thinking, Central Banks just have to do something. Former meeting for the fed. You up. Im a shortterm days ago now we have four. We do not even have one yet. There is some speculation the 10 year yields fall to 1 . I wonder if during the big rally , it is easy to make larger forecasts. , again i was looking at the unemployment rate. 3. 6 if i am correct. The lowest since 1960 nine when Richard Nixon was an office, and when i was five years old. Trees do not grow forever. The economy will not expand forever. Growth is Strong Enough now, are pretty yields far out. Kathleen, what is the reaction elsewhere . Emerging markets, Central Banks. A low Interest Rate environment gives them wiggle room here is well. What about what mark carney had to say in all of this . mark carney has been concerned about the risk of a hard brexit, and there is that concern. At the same time, the bank of england is not as dovish as you think. If they do not get the hard high, theflation is more hawkish ones could move in the other direction. The fed telling us, unless something changes, they are ready for a cut. Says he can be like mario draghi and do what is necessary. The head of the reserve bank of australia saying it would not be unrealistic to look for more rate cuts. If you think at how closely he held his cards to the best, it was so low for so long, when he says Something Like this, you have to take it to the bank. The bank of indonesia did not cut its key rate, but eased its ratio. They are nervous, but at the , they arewith the fed taking a prudent pause. The tilt there is expected to be lower if they can, if inflation behaves. The bank of reserve of india also sending to suggest looking to the possibility to cut again as well. One outlier, dont you wish you lived in norway . They cut their key rates for the third time in september. The Sovereign Wealth Fund is so full because of oil that they are getting overheating. They are not typical. Rishaad thank you Kathleen Hays and wes goodman. The mliv blog is on the bloomberg terminal. David speaking of Central Banks, do not miss our exclusive interview with the fed vice chair at 6 30 p. M. In hong kong. We have an update on first word news. We start with south korean exports. A bellwether as for global trade, and showing no sign of recovery as tech slows and the tariff war drags on. A seven month decline. The actual picture may be worse, but the period having one more working day than a year ago. Japanese inflation slipped last month, adding pressure on the boj which is facing a strengthening yen. Consumer prices excluding fresh food rose by 0. 8 in may. Inflation is expected to slow again later in the year on lower freee phone charges and school education. President trump is downplaying his attack on the navy drone in the gulf, saying a Single Person acting alone may have been responsible for the strike. Tehran says the aircraft was in iranian airspace, and the shooting is a message to washington. The president says the shooting was a mistake. President trump i find it hard to believe it was intentional, it could have been somebody who was stupid that did it. Back,l be able to report and you will understand what happened, but it was a foolish move. Chinese president xi jinping is ready to play a positive role to denuclearize the korean peninsula. Calling for a political solution, he met kim jongun at the start of a visit. The first visit in 14 years. They are expected the court made their approaches to the current standoff each country has with the United States. Global news, 24 hours a day on air and at tictoc on twitter, powered by 2700 journalists and analysts in more than 120 countries. This is first word. David all across the world from haveork, in bangkok you the thai Prime Minister speaking at the business summit taking place there in the capital. Rishaad he is talking about the labor force, they need to make changes. Talking about the improvement in interest or infrastructure. Thailand will attract 14 million tourists this year. Live go is therefore you. There for you. President and then the homegrown ambitions. This is bloomberg. Rishaad you are back with Bloomberg Markets asia. We have the shadow of this trade war looming over the get together, the top concerns for weakening demand and investor sentiment. Electronic cycle that is particularly bad news for asian exporters. Talks will focus on theainability, knitting regions markets together, and innovation. Closer look on how trade tensions are hitting supply chains and the logistics industry. One company that has been adjusting strategy to the environment is flex port, a San Francisco startup. They hope to make shipping more cheaper and efficient. The bloomberg summit in bangkok. Huey lin, president , flexport inc. Is joining us. Lets kick things off with what you are seeing their. Our supply chains evolving . They were evolving before the negotiations between china and the United States broke down. Are you saying and acceleration . Are you seeing and acceleration . Huey absolutely, things are moving at a pace here, and we are having ever more conversations with customers to leverage the platform we have, to help them navigate and diversify what they are going through now. David part of those conversations are what . Where are they trying to diversify to . Manufacturing capacity being brought, and what kind of capacity . Specifically, we are talking about whether it is the daytoday of thinking about simplifying. One customer i spoke with, they are leveraging 200 manufacturers to think about how to reduce that, to those who are thinking about how to ship and accommodate the signs of having to increase prices. And what are the ways i would imagine you are trying to address and have addressed. Huey absolutely. Flexport not only uses this technology to move freight from here to there, we are in infrastructure and human expertise. What may not be common is to move freights from here all the way there often requires at least 18 Companies Using technologies or the basic of to make sureil everything is moving in the right way. The part we are working hard on is ensuring those things are digitized so everyone can stay tonight stay connected in real time. Rishaad are things going wrong at the moment . We arehe fact that seeing trade flows come off a little bit, are you saying that are you seeing that . I would say freight, because it is so complicated, the wrong word to use is there is often a number of exceptions. In exceptional times, there are additional changes happening. This is where the Technology Comes in that allows us to see as infrastructure allows us to use the warehousing to correct it, along with the people who are familiar and wellversed to help guide if things change and evolve. Seeing tradeyou flows go down . We have a chart that shows the freight rates between shanghai and the los angeles, also shanghai with rotterdam. L. A. , the containers have gone from november 2 2700 down to 1400. Huey trade is not disappearing. It is shifting, and the trends youre seeing, we are here to solve trade for the world. We aspire to make global trade easier for everyone everywhere. There are things changing, i think it is a great time for us to innovate and stay with it by leveraging our Technology Infrastructure and expertise to keep up. Question. Last are you open to being acquired . That is not something i think i can speak about. Global trade is complex, and i think inviting everyone to come together to solve something that i think everyone should aspire to. David come together to help. Rishaad are you using blockchain . Currently, we have obviously a group of talent coming together and taking a look at it. This is not something we are actively working on at the moment. For us, there is plenty of work to do to make sure all the data that is needed to move freight is on the grid organized in a way we can use it properly. Verse thing first, that is what we are focusing on. David thank you so much. Please enjoy the summit there. That was huey lin, president , flexport inc. We are live out of bangkok at the business summit. Right now it is the Prime Minister speaking at the summit. He is talking about the need to reduce social gaps. He has moved his topic from what thailand is doing to climate comes and how asean together. You are talking about 10 countries. In terms of population, the size of the eurozone. All sorts of currencies and languages there as well. It is unity and diversity. Rishaad this is what else we have on monday. Malaysias Prime Minister will talk in bangkok. His interview 6 00 a. M. Hong kong time. This is bloomberg. David welcome back. You are watching Bloomberg Markets asia. Tesla, doubts about profit and demand. Appear to be on the high side. He added that the Second Quarter may have improved, but a level that is likely not simple. Elon musk says sales hit a record this quarter. Delta airlines is extending its push overseas by taking a part outside its home market. Of koreasg a 4 largest shareholder, and will raise that to 10 . The deal comes a year after they began a venture that allows them to 80 destinations in asia and 290 in the United States. , the salean closing of the chinese business. They have held talks with potential advisors on the sale which could raise 200 million. Exploring ways to pay down its debt. It opened 15 years ago and distributes throughout china. Lets look at the overall position. The japanese 10 year yield 18 basis points, 18 basis points i should say as yields have gone basisurther by two points. Theres nothing to reform their commitments to what they have at the moment. Their targets on the yield her control here as well. Market 0. 3 lower. The move down by 0. 1 . 1. 90eek ago we were at the handle. 1. 09 handle. The nissan board committee, that stock is up 0. 6 . It does not look like that alliances getting a firmer footing. And oil related issues are up 3. 8 . David 10 29 in hong kong. Headlines. Rst Word Congress has issued a rare review to President Trump with the Senate Voting to block arms sales to saudi arabia. A handful of republicans supported a democrat move to resize the president s use of the Emergency Declaration to sell weapons to the kingdom despite congressional objections. The resolution passed, but the numbers did not reach the two thirds majority to override a trump veto. The next fewecome kit Prime Minister is down to a final field of two. Former foreign secretary Boris Johnson extended his lead among conservative lawmakers winning 160 vote, while the last remitting rival jeremy hunt has the backing of 77 mps. They will compete over the next with the winner announced in late july. Offeringan airlines is to fly Central American migrants back home for just a dollar. It will take people into juana to back to elant salvador or guatemala, providing they can show some id and take the next flight. The program is called reuniting families. Minutes from the last reserve bank of india and meeting shows policymakers increasingly concerned about the slowing economy. The governor said growth is , and below thed target of 4 on inflation. May includes a rise in income Tax Threshold in a bid to kickstart consumption. Global news, 24 hours a day on air and at tictoc on twitter, powered by 2700 journalists and analysts in more than 120 countries. This is bloomberg. David just to get you up to date on this briefing that is taking place from the malaysian anticorruption commission. Several things to take note of. 217 are seeking to recover ringgits in terms of what will be practical. Rishaad apparently they have the 217d funds, and for 1mdbinggits made. It will be practical to recoup these funds, quite a lot of them too. As theythe position look and tell the public about this investigation into 1mdb. We hear a lot about chinas market, and indias which is growing by leaps and bounds. ,avid another asian market vietnam is moving into the car business with its own brand. The audit unit rolled out its first the auto unit rolled out its first modern manufacturing sector. Lets get more on this and bring in the chairwoman le thi thu thuy. We are looking at your first car. For those who have not heard about this, what are you calling the car, and how much will it set me back . Last friday we launched the less than a small cuv 20,000. Than 40,000. Ess suv seven seater is lesst than 60,000. Rishaad what are you hoping to achieve here . Will it be a domestic push to begin with as it was in china, or will it be an International One . Obviously, we start with the domestic market in mind. The 10 of what it is in , 20 cars for every thousand people. Huge market potential if you can get to the thailand level in the next few years. There is a huge market in vietnam. Up. Per capita is going in vietnam, there is more highway. This is a huge market potential in vietnam. We have our eyes on the International Market as well. David you mentioned prices earlier. Would you share how much it costs to make those cars . Part of why i am asking you that question, we are looking at whether or not it is affordable commercially to make vehicles in vietnam, and sell them and make money. Le first of all, these are our first cars, we are launching marketemium cars to the first. The next year we come out with a portfolio of more affordable cars. Also have i do not know if you have heard about it we do not take profit. Count financing costs into the car. Moneynow, we are losing on the cars we are selling on the market. There is room for optimization in manufacturing and our operations. , there is a little bit of room to increase the price a little bit. We expect we will implement the pricing at least in the vietnam market. Clarify, in other words you were saying you are subsidizing the price of the car. Is that the same that saying if you include financing costs that it is actually not competitive to make cars in vietnam and be able to move the market share . Le with the new portfolio of cars next year, we think it will be competitive. We will be more optimized. The first car we are not at that level yet. In mind our pricing for the cars are very low compared to the quality of the car. We would like to price the car in a way to make it affordable for the vietnamese people, and allow the vietnamese consumer to experience the quality of our car before we start thinking about profits. We will keep the pricing for a while. How will the vietnamese people take to this car . How many are you hoping to sell . Brandis very much a conscious element to this amongst consumers there. How do you get around that . Launch, as of the end of last week we had more than 10,000 orders. Before the consumer has been able to test drive the car, we already got more than 10,000 orders. For the smaller. Ars are fully paid for we have a lot of products in vietnam. We are known for quality products and affordable prices for the vietnamese people. The vietnamese our brand conscious. Havead very quickly, we the automotive world out there, too muchot probably capacity. Why add capacity at this point . There are so many players here. What makes you confident you can succeed against people who have been doing this for decades . Le we think that we can. Obviously, nobody with hundreds of years in experience in nobody has built a car of quality and 21 months. We put the Team Together and the plans together and designed the cars at the same time. Being in the Automotive Industry for the last one he one months let me realize there are things that can be done differently in the industry, and we believe we can do it. David fairpoint. Thank you for making time to join us on the program. The first of the in the enemys car hoping to compete with toyota and others. There is plenty more ahead. We will be live in the streets of hong kong to talk about the latest on the protests. Live pictures down on the streets in the business district. This is bloomberg. David welcome back. Demonstrators are gathering at the hong kong offices saying their demands have not been met. Lam tont chief executive quit. Rishaad yvonne man is where people are gathering. What is it like and what is expected today . It seems like right now it is a wait and see. It is peaceful here so far. The crowd has gathered, hundreds of people still out here for several hours since the protests started. At this point, they have no plans what to do next or if they can escalate this further. The government did not get into ltimatum,. Tions u deliver on our demands are we will protest in the streets. That demand came yesterday at 5 30. They are gathering at the Government House where lams residential house is. You mentioned some of those demands. Of carrie lamlies say she has apologized twice this week am a but the opposition says too little, too late. The support behind carrie lam, do they continue to do so given the current pressure over the last week and a half or so . Wonder whathave to ultimately led carrie lam to come out and apologize a couple of days ago. Some say beijing might have had something to do with it, a sign of them caving and underestimating how many people would have shown up in protest of the extradition bill. Timing wise as well, we are getting close to the g20, and beijing has to find a way to defuse the situation so the u. S. Will not bring the hong kong issue into trade negotiations with xi jinping of china. We spoke to martin lee, the downing chairman of the democratic party, the opposition, and asked him that question. Here is what he had to say. Chosejing effectively every one of our chief executives including carrie lam, and none of them work. This whole system does not work, that is a problem. This is a time to take a deep , trust the hong kong people, let us elect our own chief executive. Just leave us alone. Yvonne there are questions raised, how long these protesters can continue on with the sheer scale of people that turn out in groups like this as well. This movement is different from what we saw in 2014. A key leader or figure leading the charge. Anonymousf the approach. A lot of questions on the sustainability of this, and if these former leaders from the occupy movement are going to take over. Thank you, yvonne man live for us. Rishaad lets get to the latest headlines. Watches 80 jump in china sales, better than anticipated demand. A drop in the cheaper models. Ichemont is one of the top performers this year. Take it comes in the form of a goodwill. On the retail business, Energy Australia unit. Retail tariffs cut earnings by 40 million. Rishaad 50 higher than the ofce slight evaluation 21 billion. The Venture Capital arm of bloomberg lp is an investor. David earlier we spoke with the ceo and cfo, they told us why they chose this route and not the traditional ipo. No need to raise primary capital. We came in with over a hundred Million Dollars on the balance sheet. We did get more freedom how we tell the story. Instead of only having a roadshow with investors, we were able to do an investor day, livestream it, and make the video available to everyone. That puts us in better position. Black is still profitable. How far out is profitability . Our primary focus is to invest in growth. As we continue to build on what we think is a new category, that will be our focus for a long time. Investors that our nearterm priority is to break even. We have high confidence that we whilevest aggressively driving toward nearterm profitability. Emily how much of a priority is priority desk is profitability . I do not want to get too technical, there is deferred revenue. Bringing in more cash than we priority because it allows us to control our destiny. Defined findus is new ways and opportunities to invest to further grow the business. We do not need a lot cash flow, just a little bit. Revenue growth is slowing. What are new sources of revenue you expect to cap . To tap . Gotten 95,000 customers, our enterprise customers are growing faster. What we are seeing, we are scaling. Mathematically we will come down, but we are optimistic about the opportunity. We are focused on that. Ceo speakingas the to us from the new york stock exchange. Start of the session in india, 55 minutes away. We are joined to mumbai. They are not happy about what is going on with regards to growth, are they . They suddenly are not, and they have indicated the fallen core inflation and gdp data indicates some slackness, which indicates a further weakening economy. Because of that, they have been more dovish. They have deferred sharply when it comes to fiscal risk especially outlook on inflation and Interest Rates. We will be watching out for that. David i have to ask you about jet airways. Update. An that was certainly a surprising move considering an is following this rumors in the markets about a shortcoming perhaps, and now we are saying it has been admitted whonsolvency with lenders will deal with the debt, or finding an investor, and this is the final nail in the coffin now. Rishaad thank you. The charts. Attle of are your bets on equities are oil . David find out who wins, next. This is bloomberg. Rishaad it is the battle for the chocolate teacup. Battle of the charts. Charts on your bloomberg, gtd go. Lets kick things off now. We are starting with jeannie. Possiblert is about technical barriers emerging for ,he chinese benchmark index like what was flagged yesterday. Is can see the yellow line the 50 moving day average, getting close to the 100 day moving average. Before, itappened preceded declines in the markets. Traders, it is a warning sign for them. I like how jeannie was sweet but savage in the messaging there. Hi. The chart i want to show you is about the diversions we are saying between the u. S. Oil price and opec production. Chart,look at the bar you can actually see that u. S. Production is at a near record. Yesterday, and oil prices have risen more than 20 this year, which is supporting the leg up in production. And the news is that america is expected to dominate supplygrowth next year. On the other hand, you see opec production sliding down. We had the opec and allies pass on reducing production, as well as unexpected outages in places like venezuela, iran, and nigeria which largely comes from the american sanctions. We are going to have new projects, and the u. S. Shale year,ill be going on next and the divergence will stay, and we are expecting the opec producers to come to an agreement extending cuts on july 12. They will not come across any time soon, but the divergence remains to be seen. Rishaad the yellow line is showing a decline. David i give it to jeannie, congratulations, nothing personal. Nothing against your chart. Rishaad it had more predictive value. David there is a lot more coming up. This is bloomberg. Hey im bill slowsky jr. , i live on my own now ive got xfinity, because i like to live life in the fast lane. Unlike my parents. You rambling about xfinity again . Youre so cute when you get excited. Anyways. Ive got their app right here, i can troubleshoot. I can schedule a time for them to call me back, its great you have our number programmed in . Ya i dont even know your phone anymore. Excuse me . what . I dont know your phone number. Aw well. He doesnt know our phone number you have our fax number, obviously. Todays xfinity service. Simple. Easy. Awesome. Ill pass. Emily im emily chang in San Francisco and this is bloomberg technology. Coming up, a popular messaging software spikes in its first day as a public company. Plus, trade war woes. Apple makes simply to the white house, saying new tariffs will hurt its contribution to the u. S. Economy