The aussie market doing ok despite some not great news from the pmi, which we can look at now. Contractiong seeing on the manufacturing side of things. The has helped to bring bulls out for bonds suggesting we see another Interest Rate cut coming through from the reserve bank. Things inso got other play here as well. 10 year yield, three basis points down. Below 1 again. That facility will not be ready to operate fully for months. , after that 20 billion worth of Corporate Tax cuts designed to stimulate the economy. Nifty futures pointing upside as well. Could be adding to that huge gain. Biggest lift up in indian equities in a decade. There we have it at the moment. Now. the renminbi right off by looking at the chinese currency. Theres nothing much happening but that is the story. Or are we looking at Something Else . Guest no, you are right. On the surface they are not big moves today. It is interesting that pboc fixing today. Four pips higher for dollar yuan than friday even though we supposedly heard soothing comments over the weekend on where the u. S. And china are heading. As far as the pboc is concerned obviously nothing has changed. You can see the offshore yuan is slightly weaker than towards the end of the day friday. It is an indication that for now nobody really see is any sustained strength in the yuan. If you look at the volatility curves, there is nothing to indicate traders are suddenly bullish on the yuan because china visited a few farms in the u. S. They want to see more than that. Obviously they are pretty worried that donald trump does not want to do a partial trade deal. When you put all the pieces together, when you look at it from the point of view of yuan traders, they certainly still feel there could be more bad news to come. Certainly a lot of hard work before they get tangible positives to make them want to get bullish on the yuan. For the time being the story is pretty much the same. Will we see the yuan steadily climbing towards the big holidays which begin this weekend . Pboc will be happy with low volatility, but there is nothing to make them get aggressively bullish on the currency. Rishaad right. Looking at india as well, Massive Gains when we had the friday session off the back of the stimulus program. What are the implications here . Mark one of the things that may have got lost in the action friday, it was fantastic for the equity market. It was not good for the credit market in india. The most in six years on a single day. That just shows you the as good as it is in one sector of the economy, for certain assets, if india will play fast and loose with its fiscal position, that will bring scrutiny from the Credit Rating agencies. We have already seen a couple of them saying we are going to look more closely at how i the indian deficit thats in the coming months. Of course from indias point of view they want to stimulate the economy and get it back on track, but there will be some offsetting factors. At least indias Credit Rating is a much stronger position than it was the last decade. Gradually improved their rating. Investmentgrade country compared to a decade ago. A much at her position. Risksearly there will be as the government strains to stimulate the economy. Some sectors will not do so well. The yields probably have to rise further. You have this offset. People have to be a bit more discerning as they go into india, which part they want to stay in and which part they dont they will probably continue to lower rates. The long end of the curve, affecting the Credit Outlook for india as well. Yvonne thank you for sending it all up for us. Lets stick to the india story. Look a little more on the geopolitical side of things. The indian Prime Minister and donald trump shared a stage at a rally in texas during the weekend. They called it they exchanged lavish parade before a crowd of more than 50,000 Indian Americans who are seen as an influential voter space. Aim to as theys they finalize a trade deal. Part of is an important our overall bilateral engagement. The u. S. Is indias largest trading partner. Both countries have invested significantly in these capacities. And of course getting more favorable, preferential access for each others countries i think is an important priority. And we are looking at some sort outcome that would be of future benefit to both countries. Think our trade officials are discussing the prospects of taking the trade agenda forward. Yvonne joining us now from , director ofin analysis from geopolitical futures. I am sure you have been following all the headlines over the weekend. 50,000 people at energy stadium. How big of a winwin was this for both leaders . Jacob i guess i should say howdy, yall before i get started. Howdy indeed. Mostly a symbolic winwin. The quote, unquote trade deal that will happen, i think it will be fairly limited. Something trump gets to claim credit for and modi gets to claim credit for. In terms of substance, i dont understand what will be there. Houston is the oil capital of the u. S. And the capital of u. S. Oil exports. That is one area where you already see u. S. And india relations coming off. Geopolitically it is a mismatch between them. The u. S. Wants more than india than india is willing to give. Longterm, along the same lines of how now for that country the u. S. Moving forward . Is it that bellwether that they want and need in this part of the world . Jacob it is certainly the bellwether the u. S. Would like. I do not think the u. S. Can depend on then the of the same way it depended on japan. Remember that the United States rebuilt japan because it destroyed japan. It got to write japans constitution and rebuild their economy. India is a strong, independent state. Under modi it has gotten stronger and wants to become more independent. There are areas where modi will feel great to show india is a major player. When the u. S. Said you have to do everything we have to say about iran, india will say why do we have to listen to you . India had a long experience of having to take orders from the west. I think they will push back against that. Certainly the u. S. Wants that. Indias challenge would be to take what he get without giving too much. So far i think they are doing a good job. You to just want to get lord paul since 19 century maxim which was if you want to look at a countrys Foreign Policy, you look at their trade policy. Take that. India which isn not exactly great friends with china, to put it mildly. And you have got the main Foreign Policy thrust of course directed towards trade against china. How does all that dynamic play into what happens with india and japan . Jacob i did not think we were going to be speaking about lord lmertson,ay in pa but i feel very comfortable in the 19th century. India and japan and australia all share some key interests in the asiapacific interests. With the u. S. Wants economically from these allies and what they want out of each other and out of the u. S. Does not line up at all. I think we have the u. S. Discussing a potential trade deal with japan. Like we are going to get any reduction in tariffs on auto parts or imports or any of the other things. Just kind of a recognition of the status quo. Status quo is the u. S. Is not being choosy about who it raises tariffs against. India has borne some of the brunt of that, so has japan. Because of the pain chinas feeling, australia feels that. The u. S. Wants all these countries to Work Together and with the u. S. , but economically it is not in their interest to do that along the lines u. S. Is asking for. Yvonne i am guessing modi will get less fanfare at the u. N. General assembly over ratcheted tensions with cashmere. Kashmir. This decision to revoke article 370, some say it is a good thing in terms of economic development. Some say it is a threat to democracy. Where do you stand on that . Jacob it is not for me for decide. To decide see trump not to say anything bad about it. When you think about what is going on in india, it was certainly a break of what the International Community expected from india. They are all sitting in hong kong right now. They have seen with the u. S. Has sent to china if it decides it wants to use substantial force, the kind of force india used in kashmir. It is hard not to see the double standard. If i was pakistan and looking at lovefest, thep u. S. And pakistan were already having problems but you have to basically be saying the u. S. Relationship is dead. They are not even pretending to stick up for the independence of kashmir and the things we want. David since you brought it up, you do not seem worried about what is happening in hong kong. Some would say we are approaching the deadline which is october 1, the 70th anniversary of the peoples republic. Why do you think people things are Getting Better . Jacob very easy for me to say not to worry about it because i am not in hong kong. You guys are. I am sure it is harder for you. Ultimately china here does not want to intervene. If china has to intervene, that is a big loss for china. We talk about one country, two systems. That cuts both ways. China recognizes that for as long as that will be in place, the rules will be different. If this happened in a mainland city it would have already had your Tiananmen Square moment. But right now i think what china is doing is it is trying to give these more violent and radical protesters as much rope as they can so they can discredit themselves and make themselves not look good to the rest of the hong kong people. The real problem for china is if you get those numbers of one million people, if you get the grandmother, the children, if you get those people in the streets, nonviolent protests, that is a huge problem for china. Then china cannot do anything. Peopleow you have some making themselves looking not so great, disrupting infrastructure because they want to make a point, a lot easier for china to spin that in their direction and ultimately that works in their favor. Rishaad jacob, stick around. Lets get over to the first word news. The globaligns of economy from an economic l whether in this part of the world. Su that would be south korea. The latest Economic Data shows south korean exports are policed for a 10th among currently 10th monthly decline. Overseas shipments plunged 22 from a year ago. New deliveries to china down 30 . Overall chip sales plunging 40 . Weakening demand hurting Corporate Investment putting the economy on course for the slowest growth since the financial crisis. Say signsom singapore from breaches of data privacy have surged this year, topping the total of the previous three years combined. Risenies this year have 930 million both were involved in a massive breach last year. 29 entities have been targeted compared to 28 in w2018. Be losing itss to appeal for chinese tourists. This is happening as the trade war and he slowing mainland economy keeps travelers at home. 1 itors from china rose only in the 12 months through july. That is after the weakest growth rate in nine years. At the same time growth in the number of students heading south also slowed rapidly. The trade war is causing uncertainty, particularly for young people. Global news 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im su keenan. This is bloomberg. We will beng up, discussing the surprise Corporate Tax cut in india was one of the countrys largest conglomerates. Their chairman will be joining us in about 20 minutes. Rishaad prodemocracy protests entering its 16th week. More clashes across the city. This is bloomberg. Is bloomberg. David welcome back. To rule out war in the middle east as the u. S. Sends additional the terry aid to saudi arabia. The chances of facetoface talks in new york wither. The foreign minister told cbs he is not optimistic about avoiding a conflict, but said iran would not be the one to start a fight. The Department Spokesperson says the u. S. Is in favor of a peaceful, diplomatic solution to the current tensions. Here at the state department we are pushing a diplomatic solution. We are pushing a peaceful solution. You will see at the uns General Assembly next week secretary pompeo continue to push for the International Community to come together to continue and try to stop and prevent iran from continuing to terrorize the region. Rishaad meanwhile saudi aramco allowing bloomberg and other media to inspect its facilities. Our middle east anchor had the look at the damage firsthand. Drones came on this area on that fateful saturday. This is the crude Oil Processing facility, the largest in the world. And a jewel in the crown of the global entity infrastructure. 230 miles away from the capital. I want to show you the damage in a bit more detail. Far end of this have survived the attacks. But this first one is absolutely devastated. Still a lot of debate about where the attack was launched from. Iran denies playing a role. The u. S. And saudi governments believe the attached could have been launched from iran or iraq. Yemen houthi have claimed responsibility. This is where the actual crude is pumped out of the ground and fed to refineries in the area. Seven missiles hit here according to information from the saudi government. The damage is very extensive. Restoring physical capacity backed by the end of the year is achievable, the real risk is endangering the countrys reputation as a Reliable Energy supplier. Still with us is jacob. Heret to connect some dots and see what you make of them. How far is this pressure on iran at the moment, which has abated some extent . We got a lot of rhetoric out of tehran at the moment. Going to push the u. S. To do a trade deal with china, as china is still in the game. What are your thoughts on that . Jacob i dont see a connection. I think the u. S. Is trying to decouple its relationship with iran. China might ask for that but china is not in a position really to make that ask. The ironic thing here is everything the Trump Administration has done to exert maximum pressure and try to put pressure on the iran of an economy, they have succeeded in pressuring the iranian economy. They have also given the iranian population a flag to rally around and they have huge support for the iranian government. In some ways the exact thing the u. S. Is trying to do to get the outcome it wants in iran is present preventing it from making progress. Yvonne you are a little suspicious about how evolved iran was with this latest attack. Why the suspicion . Jacob i have more questions than i have answers. Is saudi question is, arabia the most incompetent country in the middle east . Billion in100 weapons but the antimissile defense was pointed in the wrong direction . Then they say dont worry, everything will be fine, then no. A couple days later they are saying it will take us until the end of the year, a couple more months. It is very hard not to feel like anything is happening with saudi arabia that makes sense. The war in yemen has been a complete and total disaster. They are pointing the finger at iran. Today they say we dont have the smoking gun. We are still doing investigations. So i am very suspicious. Until have a smoking gun i will be suspicious. Yvonne thank you for your thoughts, jacob. A look at how india is laying down the welcome mat for american money and hear exclusively from an indian billionaire. This is bloomberg. This is bloomberg. David welcome back. Wework, the issues are still piling up at the Office Sharing startup. Bloomberg is told some members afterdam to stand down the delay of the muchanticipated ipo. Softbank are to said to want him out and the board is reported to be meeting later monday. Valuations went from 47 billion in january to 14 billion today. Company known as tencent outpacing its american arrival in one the company known as chinas tesla is outpacing them and losing money. It is based in shanghai. A report tuesday is expected to lose 370 million. They have plunged 74 after its market value hit 12 billion. Here we go. This company applying for compulsory liquidation. Thousands of travelers have been essentially stranded overseas. The u. K. Is sending planes to get them. A pile of debt which is not a labeled enabled them to pay it back. Filing early monday. Talks to raise additional funding failed. Shareholder in thomas cook. Web jets had a deal to source hotels with the company. That is a look at the implications of the thomas cook liquidation in this part of the world. It is 10 20 9 a. M. In hong kong and shanghai, 10 29 p. M. In new york. Im syncing with the first word headlines. Andtart with Police Protesters who clashed again in unrest continues for a 16th weekend. Initial Peaceful Demonstrations later erupted into violence, with a subway station vandalized. Is now bracing for a around theotests seventh anniversary of the founding of the peoples republic of china. Brexit is now just six weeks away, and carmakers in the u. K. And in europe are warning that a no deal divorce would have disastrous consequences for the auto industry. You companies have developed interlocking supply chains that rely on movement of components across the bloc. The u. K. Society of Motor Manufacturers and traders said no deal would cause irreversible harm to the auto sector. Skipping thisp is weeks Climate Change debate at the united nations, but is insisting his action is not meant to be a snub. Busy buts he is very is being briefed on important matters. Are calling on governments and war leaders to do more to stop Climate Change. Sayin singapore, reports five breaches of data privacy have surged this year, topping the total of the previous three years combined. Most of the fines were handed to two entities, both involved in a massive breach last year. Theret to clarify that was a reported 937,000 usd, not million, as we incorrectly stated earlier. Global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im su keenan. This is bloomberg. Lets go back to another top story. Indias surprise Corporate Tax cut, our next guest saying they may boost growth with a sizable cut. Joining us is our Southeast Asia economics editor. Thank you for joining us. Is this fiscal imprudence in your view . I think the fiscal imprudence calls what i would say is that at this point when the government has thoroughly pushed back on giving into our big fiscal bonanza to boost growth from a demandside perspective, given how much growth was floundering, and contrary to all expectations went in with such a on theitive surprise Corporate Tax rate cut, it does put a question mark in terms of the fiscal def difference. Right. They probably need to tighten their belts somewhere else. Where do you think they will cut spending from . Mark. T is a big question losses,ook at revenue the current tax rate collection has been running up whatever was extentd and to that there is a growing concern. If you are pushing back on infrastructure spending, which demande you could see coming through in terms of the shortterm approach, that could actually make the shortterm outlook remain quite wholesome. Lets talk about the good stuff, the good side of the stimulus. We are talking about 60 or lows for the indian growth picture. Arrest the will this slowdown . This is is a good side, definitely from a mediumterm perspective of positive reform. Arisen in terms of the u. S. China trade war intensifying, which parts of asia are best place in terms of attracting supply chains and at least from my perspective it has weighed on india. Rates inng indias tax ite with new york companies, does brighten the mediumterm prospects. I think that is something to price in. On a shortterm perspective a does theds howd company redistribute savings . Storys more of an fy 21 where we see little in terms of uplifting growth. This deter the r. B. I. To cut rates, or do you think they still have to continue no matter what . I think they have to continue on the easing cycle. This is not a boost. More likely it is to be weak itded, given how continues to be and as they react following the announcement, this could complicate the Monetary Policy going forward. Right, im going to bring in another issue, the crackdown when it comes to shadow all these fiscal measures that were announced on friday can be a transfer of earnings if companies do tend to keep them. Do you think this was also meant to alleviate funding, to keep money themselves instead of ways to raise money where they are not allowed to . Slightly tangential way of looking at it corporates benefit from this but they havectly been doing baby steps all the from the r. B. I. , and in terms of supporting the sector, making it easier for banks to lend and that has been a big stress so far, easier borrowing conditions, which caused for a slowpaced pickup and monetary rebound. Thank you very much. I take on that fiscal stimulus measure. Lets get more from our next guest, a billionaire industrialist and businessman, your group deals with a vast variety of different things, consumer goods, real estate, other ways of human endeavor. Thank you for joining us. What do you make of the tax cut . Is this the right move at the right time. Tell us how bad things will be getting and whether this is enough. Move anda very good personally if you say it at the would have been still better for the economy. How does this impact your Investment Plan . Are you free to invest more . Yes, i expect the economy to do well and we will certainly it will bei think very good for indias future. Which if your are specific businesses do you think you will be willing to invest more . We are trying to figure out who benefits the most and you have different benefits across different sectors which units do you think benefit the most . Benefit,ur units will and generally the whole economy will benefit. It is difficult to tell right now exactly who should benefit but i think nearly all of them. Days itill early was only friday when this was announced at we are still trying to understand the details. Do you think you will be passing those tax havens on to the consumers of your businesses, or is there an inclination to keep the money longer . Decided byld be their own competitors situation. Haven, itthis is tax is very difficult to price the product. Bad are you seeing things in the economy . It is quite a surprise how weve seen all the data turned negative in car sales are absolutely horrific and then on top of that Consumer Staples also taking it. Give us an idea of how bad things have gotten and what you see in your business at the moment and how you do with revenues, et cetera. Growth in the apriljune quarter this year was the lowest in the last six years. Is a general slowdown of the economy, and this move of the government well i think revise things well and we will be on the highgrowth path. Objective in the next five years to have a 5 trillion economy that would require 8 growth rate in the next five years. Have any money left they will have a tough time doing that. Does this now put the ball that is a mistake remember, the economy would be very good. I just want to ask you the next part does the ball go back to the court of the reserve bank of india and do they need to do more lifting . Will they cut rates more or will they wait . They will cut rates because inflation is very low, but the important thing is the rates they cut must go faster by the banks. So overall the monetary theory and if the government continues, india will do extremely well. Groupsoks like the construction is focusing more on the infrastructure sector, as well as the real estate sector. Tell us more about how you are capitalizing on the weakness we are seeing on the properties side. We have generally done the properties sector, but our Property Company has had its best two years. People are coming to us with their projects and we take them over. Right. A lot of the comparisons since puts them ateen it par or even lower than other countries, which brings us to is it enough to spur . With twoindia compete be the r. B. I. It needs and wants . What is a good country comparison . Well, we compete with all sorts of countries, i would say. Vietnam, bangladesh, indonesia. Is a largehere so we competeg with most countries in the world. Im going to again switch topics and talk about the trade you know about china and the left but the u. S. Has not india out in the cold with regards to trade. Is that doing any damage to the do you make ofat mr. Modis trip to texas, and the warm noises he heard from donald trump . They dont have many trade issues with u. S. , and mr. Modi will be spending time with President Trump. Whatever little differences they had it seems based on what weve orked about these last six seven minutes, everything is going well. What would you say is the biggest challenge and risk to the economy, if not everything we talked about . Is this a question if things start going well, and i expect they will, then the challenges will ameliorate. Ok. Thank you very much. Coming up in the next hour. Much more insight and analysis on whats happening in india the market looks like it will go on an absolute tear. Our guest says indias equity markets do remain attractive. This is bloomberg. We are counting down, as we always do, to the session in india. When you look at futures right poised to go much higher than the closing on friday. Over inive or take singapore. Friday was stellar in a lot of ways. Today looks to be maybe not the same magnitude absolutely. Weve been talking to a lot of technical analysts and they are of the opinion that when you see such a sharp up move, it is likely to trigger more long, especially given when the nifty is back to a 30 day high. We have seen those stellar up wholeand we also had a host of rates in india. Has its nifty aroundto 15,000 from 12,500, and Morgan Stanley has also upgraded the sensex target to about 45,000 by june, 2020. Atot of they in are looking positively with these Corporate Tax cuts and there has been a lot of buying in terms of the Manufacturing Sector and a lot of fund flows through domestic outlooks. Were just going to have to see whether or not this strength stays. One time boost or signs of a turnaround . Thank you, joining us with the latest out of mumbai. Lets get the latest business flash headlines. Saudi Aramco Oil Facilities hit by drone strikes may take longer than thought to help hundreds of millions of dollars, despite initial optimism that things could return to normal, the dow jones is reporting that it could be many months away. They are offering to pay contractors extra to prepare work. Deutsche bank says they are close to a deal to transfer their prime brokerage business. An announcement is expected to come soon, details have not been made clear, and it is not know n how they will make the switch. A final agreement is yet to be made and the deal could still far apart. Stockport is no longer the top of the town. Trading activity has slowed since julys launch in the initial Public Offerings have been lackluster at best. 11 of the 29 stocks listed so far end of the session more than 30 below recent highs. It is down 10 from the high on august 15. If you are on the internet, join tictoc by twitter and check out our hourly updates, top news reports verified by bloomberg. Jump on twitter. Gotten to such extreme positioning through the end of august and we had to recalibrate some of that. We are going back to that trend which means you will see multiyear lows tested and the folks over at qic in australia, they are favoring where you want to be on the long end. We will see if we can get back to last years low what do you have . At bitcoin,ng always exciting. Today we have the intercontinental exchange, futures physically delivered. Some people might look at this is a good sign for bitcoin, prices going up, but lets keep in mind that the last real advance we had in u. S. Regulated wasitutions doing something the Bitcoin Futures that settled 2017 then december, crypto winter that followed. It is not necessarily a great sign for the actual bitcoin price when you have the launch of a big new products, although it could be good in the long run. We have had those that settle in cash but not physical delivery what do you actually get, physically . I thought they sent you a computer, find the guy with the password. David, i think you are going to have im giving it to adam. Underscored the difference and importance is it correlation or causality. Position,ook at the is it because of jayda or was it chasing data . Congratulations. To tv is where you are going to see them. Not a whole lot going on. We have equities at the moment. Nifty was up 5. 5 on friday. Futures are indicating that we may will be seeing more outside and we also have inside coming from the east wing investment. You will be having a look at the equity markets and some of the key things that look rather attractive. We also have aquarius Investment Managers coming up to give us their take of the latest modi move. It is almost 11 00 in singapore, 8 30 a. M. In mumbai. Im haslinda amin. Im rishaad salamat. We are entering the last hour of the morning session in hong kong, heres a look at our top stories. South korea taking another hit from the trade war, early signs that exports are plunging again, heading for their worst performance since the financial crisis. Indian markets enjoyed a bump on friday, however some indicators may show it could be fleeting. U. N. Leaders heading with the debate over Climate Change at the top of the agenda. This is Bloomberg Markets. Showing signs of dissipating, none of this is incomplete do you want the complete deal, meaning more difficult for them to come to some sort of agreement . Also we are seeing data out of korea, those export numbers inappointing, down about 22 the 20 days leading up to september when it comes to chip exports, down 40 . It is not just in asia but around the world, and when you take a look at pmi numbers that is not helping either. Lets take a look at stocks, japan closed for a holiday today, down by. 4 , led by chinese stocks down 1. 5 . We are seeing the chinese stocks giving up on those gains after those mixed indications from the trade talks. , stocks in this week australia bucking the trend by. 4 , Energy Stocks lifting the benchmark and now more and more we are hearing they are cutting cut istions a rate expected later this week. Ats is how we are looking the level ise say as much as 7. 13. And its will persist will continue to be strengthened when it comes to uncertainty in the market. Right, thanks. This is a quick look at the indian market, what a stellar day for them, 20 billion worth of Corporate Tax cuts coming through, cheered on by investors. The chairman is saying what a good thing it was a short while ago and that they could help india get to that 5 trillion economy in five years time. And itlose at 11000 belies the fact that we had a 5. 5 percent uplift at the end of last week. Withndian rupee held up some of that stinks, and we have seen a slight move to the upside , with the dollar just starting to trade. Of the bondnt out market and into the equity markets, yield curve backing up 6. 70 , futures indicating will be seeing more of again, but nothing like we saw on friday. With all that in mind, lets get to new york with the first word news. Thank you. We start with iran, which is refusing tarullo war in the middle east as the u. S. Sends additional military aid to saudi arabia. The foreign minister told cbs that he is not optimistic about avoiding conflict, but added that iran would not be the one certified. Rouhani went to the yuan General Assembly and says they will lay out a peace initiative. We are confident that we will not start one but i am confident that whoever starts one will not be the one who finishes it. Reports from the gulf say iran has released british tankers released after that was impounded in gibraltar. They have been released and what is seen as an attempt to reduce tensions in the gulf. The tanker was detained in the strait of hormuz after an iranian tanker was halted at the request of u. S. Authorities. Lets get to brexit, it is now just six weeks away and carmakers in the u. K. And europe are warning that no deal brexit would have disastrous consequences for the auto industry. Eu Companies Involved with supply chains that rely on swift deal wouldy that no cause irreversible harm to the auto sector. Global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im su keenan. This is bloomberg. Thank you. World leaders are convening at the u. N. General assembly in new york this week, about 200 president s and Prime Ministers will discuss everything from the middle east to global trade. They will also host a Climate Change summit which President Trump is planning to miss. Jodi schneider joins us now. The president insisted it is not a snub. Other leaders are perceiving it that way. It is obviously a big absence to have the u. S. Is it, given that it has given so much attention. He ise president says busy dealing with the flooding in houston and the aftermath of that. He did say Climate Change is important. But he is not going to be there. That said, the u. N. Secretarygeneral and others are saying the u. S. Could make a big difference even with the absence of President Trump. Obviously he has left the Paris Climate Accord and pushed to rollback regulations affecting things like Carbon Emissions from cars, rather than heightening them. Areanies are saying they going ahead with their plans to try to reduce their carbon footprint. One leader who will be at the summit is narendra modi. A lot has been achieved, particularly after that giant rally in texas. Mr. Modi basically got on stage with President Trump, held hands and endorsed him, saying that indians had a friend in the white house and basically ignores his reelection did, 50,000 Indian Americans that mostly lean democrat according to survey research, but mr. Modi was making a bid for them to support the republican president. Clearly he is there on a mission to get more investment in india and to get better trade deals from the u. S. And before he left , they reduce not only the Corporate Tax rates but went ahead and tried to do things that will make it easier for u. S. Companies to invest, so that is clearly a big bowl, as they were on the stage with President Trump. Thank you soider, much. I would like to bring in our of multiasset solutions. Good to have you with us. Onknow the market is trading headlines but when you look at the fundamentals it is not looking good at all. Extent and at what point will markets start factoring in those pmi numbers . Earnings startte to get hit at the moment they are not getting hit although they are lower than they were last year. It is only then when you start to see can earnings be sustained in the future . Then people worry about valuations. The risk premium of equities versus bonds is still very much in equities favor but u. S. Is close to its alltime highs. You have to look at the korean market, it is all cheap and getting cheaper. Valueere are pockets of in equities. Having said that, the sentiment is being avoided well by expectations that they will jump in and provide monetary easing. When you take a look at those in asia, this could be running dry. Print theiranks can own money so it is not a problem stop the key point is that over the last decade, centralbank action has supported asset prices. They would be in the bond or equity market and that will continue. I dont think the mindset has changed. Changes obviously in fiscal policy, cutting the toporate tax rate, talking germany about how they increase fiscal spending and then you have the gridlock in congress and the u. S. About fiscal spending as well. The fiscal side that is the way people should be going and we have been talking for ages about the lack of efficacy of Monetary Policy which according to many people has now been effectively reached. Be in theld governments court, should it not . But that iso, something that has been in the Central Banks rhetoric for many years. , the bank ofhat youn, they have been saying have to do more from a government perspective. I somewhat disagree with you and say that the Monetary Policy has been effective. I think it is effective because sobrings down funding rates those highly indented companies can rollover. Ism that perspective, there still a push coming from Monetary Policy. 5 , 6 , but when you are people borrow a lot and perhaps not for the right reasons. In 2018 we saw 40 of Earnings Growth come from share buybacks. A lot of that was borrowed money. Cuts fromalso the tax trump as well. Part and parcel of that. This aggregating that is quite important. Looking forward, i think it is the earnings. Of 0 to 5 ,nings that is when you get 5 to 10 over the next 12 months. That is when you have to worry about the debt burden. Given all the uncertainties, it is becoming increasingly difficult to price in risk. That brings us to the question of the day. Our markets mispricing geopolitical risk . What is your take . I think you have to look at what time horizon you are looking at. Maybe over a fiveyear period, there probably are not pricing what can happen in terms of this globalization to local markets. That is something that i think is mispriced. With the trump sweets and concerns i would say it is more priced in. , all theansition exciting things we have to decipher. Hang tight. He is sticking around. Star. Ahead, fading why chinas newest stock is no longer the talk of the town. And more violence in hong kong as beijing prepares to mark 70 years of communist rule. That is just ahead. This is bloomberg. Hong kong Police Clashed with protesters in various parts of the city in the 16th week of prodemocracy demonstrations. Sophie kamaruddin is on the ground. Thist up as we head toward 17th and the 70th anniversary of communist rule in china. Although up indeed, there are fewer numbers compared to past weekends, but the protests saw petrol bombs, teargas, and the latest part of these demonstrations. On sundays rallies we saw hundreds occupy malls across Victoria Harbour from where i am right now and protesters are targeting businesses perceived to be prochina which is adding pressure on the retail sector, which is hurting Hotel Occupancy rates which are expected to be as low as 60 during the golden week holiday. Promptedr outlook has properties to temporarily cut rents at luxury malls and that is a survey of 5 in the next 12 months. But these economic concerns are not top of mind for protesters who are calling for more demonstrations which may cast doubt on how effective the dialogues organized by the governments maybe. Also this week on wednesday we are seeing more momentum for the push for the hong kong human rights and democracy, which could be put this wednesday. Sophie kamaruddin. Lets bring back our easter egg investments, multiasset solutions, which could lead to Slower Growth in hong kong. We are already seeing evidence of that and a lot of people have also said that people are scared of whats going on and are going elsewhere. Quite often they say singapore is where they go are you seeing any evidence of that . You have to remember that the u. S. Cut Interest Rates, which will bolster rates in hong kong. For us, when i talk to our teams yes, it does put do we really need to take the additional risk of not knowing how protests are going to end and what is the effect on the economy . Hong kong is not one of those markets where we have to have a view within the context there are plenty of other markets thatd asia and the globe we think offer better risk return rewards right now. The markets are overbought, valuations are pretty low. Greedye a time to be when others are fearful, for is it too early . I think it is a little too early. Surveysst bond manager show they have been reducing underweight asiapacific equities. Money has come back into the funneling back into the hong kong stock market as get. Sayow best to hedge some the play is gold, what is your take . They are paying us to put this hedge on, which is unusual. He needs to be more on the fiscal side as well. We could steepen the jgb curve with some success. It is a bit of a safe haven. Howell oil play out an impact the market . Still below the levels we saw this year and last stop from they are paying less now than they were a year ago. 80 90, we realize that can break growth. It is still a long way away. Colin graham, you spring investments. You are a bloomberg subscriber, you can catch up on all our interviews by using the interactive function tv. You can also join the conversation by sending instant messages to our team. Check it out at tv. This is bloomberg. You are back with Bloomberg Markets, checking in with the business flash headlines. The u. K. Travel company says it has applied to the compulsory liquidation as sources say potential new investors have failed to bring a deal. The Civil Aviation authority says the company has ceased trading and all upcoming flights in hong kong have been canceled. The company known as chinas tesla outpaces its american rival in its ability to lose money. It took tesla 15 years to rack up 5 billion in losses but neo managed it in just four. Is shanghaibased carmaker expected to lose another 370 million in the second quarter. Vaunted tech stock board is no longer the talk of the town. Have slowed since julys launch in the face of the initial Public Offerings that have been lackluster at rest. Listed endedstocks fridays session more than 30 below recent closing highs. The bloomberg gauge is down 10 from the high on august 15. It is time for stock of the hour. Haslinda is looking at a malaysian company, seeing some rather high volumes today. Give us an idea of whats going on. Well, lets start with the name of the company. This is a company that started as a small construction outfit and has become a conglomerate, dealing with everything from construction to hotels, owned by a malaysian tycoon. The reason we are seeing volume so high today is we are seeing compared0 more volume to any other day. Acquire allying to the remaining securities not already owned by the parent company, and it is proposing to do that through the issuance of new shares. Company that has been at the front and center and hasnt done well. When you take a look at the stocks, is down 7 year to date, compared toing other regional benchmarks, down 5. 5 . Not looking too good. And when you take a look at analyst recommendations, only three analysts are tracking the shares of this company and all three say you either want to hold or sell. In terms of prospects, not looking too great. 1000 in terms of volume compared to any other day. And to get a look at other stocks, we can go to the bloomberg to get access to all of it. They can go to the most function determined by which index we are looking at. Lets have a look at whats going on with chinese equities. This is the position we find ourselves in, it downdraft coming through. We have this delegation calling off farm visits the u. S. , and there was hope there would be some sort of breakthrough. With aon the way down lack of trade talks and the lack of any further direction with some equity investors. Thats a look at some of those companies on the move in korea and here in hong kong. Not looking too great because that followsand the f1 rate which we hosted last course he was levels,at unhealthy exceeding 100, which didnt affect performance. Lets get our first word headlines with su keenan. All right, we start with south korea exports, poised for a 10th monthly decline amid tree disputes and a downturn. Overseas shipments have plunged 22 from a year earlier, deliveries to china down 30 , and overall it would be plunging by 40 . Demand is turning corporate since the financial crisis. Losing a seems to be deal for chinese tourists. The number of visitors from china was 1 through july, and that is matching the weakest growth rate in nine years. At the same time, growth heading warh says the training causing uncertainty part of a 1. 4 billion joint venture that will get state owned developers and retail outlets. There is a significant investment in the region. Bloomberg reported in july that the Canadian Company was weighing in investment. And a former Credit Suisse banking star is said to have been followed by detectives as he finalized a move last month. We are told that the banker realized he was being shadowed and used to smartphone to take pictures of them. Sources say that pursuers wanted to find out if he was going to coach more to join him at ubs. Global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im su keenan. This is bloomberg. Thank you so much for that. Lets take a look at the markets at this point in time. It is a pretty risk off day, markets impacted by trump saying itwants a complete deal, and will be more difficult for the two sides to come together. We had a pretty tense protest, and that is not helping sentiment in hong kong. We saw how export numbers are pretty disappointing. When it comes to chip stocks and ,hip exports, that is down 40 getting a lift from Energy Stocks. Sentiment in asia pretty much down, it is risk off, it all depends on trade and trade talks. At 7. 13. Hen currently lets take a look at nifty helping, the fact expectations those , and thatost growth should give the lift to the market. Indias surprise moved to cut taxes means it has become one of the lowest countries in asia. The rate has been lowered from 30 to 22 , which is below the average across the continent, some 9 below japans rate. The billionaire boss of indias group welcomed the cut in told us it should have come sooner. And its a very good move should perk up the Indian Economy and as you say at the it would have still been better for the economy. Says there arest corrected measures that presents an optimistic picture of the media term prospects. Good to have you with us. You are saying that the move by modi can help lift sentiment. Undoubtedly. The market has been waiting for a very long time. Nobody ever expected that they with be cut by almost 10 Something Like 45 to 49 . From 5 to 15 from some companies. First they will use it for ying up the u. S. After while it may not happen overnight, over the next one or two quarters we see but it is not just about the taxes, its about the labor laws. All these things need to be addressed for india to be attractive. Very true. My expectation is in the next first aim wille and india isiment one of the lowest tax rates of the globe. Therefore it will lower these trade talks, there could be new Companies Looking at india, who have only 15 tax. Is incremental change, big change going forward. The next two quarters, we will see the benefits. How does this move the dial with regards to your forecast in your estimates for stocks in india . Are you upping your view on them . Yes, very much. The following sectors are something we will look at. In the first case, the banking and financial services, because banks how tax haven. Is a little bit of real estate. Within those sectors there are management paying higher sectors. After seeing Something Like 4. 7 billion worth of shares byng sold off since june International Money managers. Even if you look at whats happening and you do have traditional indian equities pricey relative to other countries, do you think this is enough to entice them back . Yes, very much. The market had their feet firmly on the ground. I think the announcement came late, theres not enough time for the market to cover up. No they will be going a little bit long but i see a major correction in the index which we positive for everybody. How do you price in the fiscal risk . A tax cut means a loss of 20 million in revenue, basically, for state coffers. Will be an increase between. 7 and. 9 . Like many others, i think the time has come for the Indian Government to look at easing rather than looking at the fiscal deficit. Sentiment is looking good. Forgety, we should not that india transferred a large portion in hindsight, we know it will be used for this kind of purpose therefore i dont think we need to be worried and it could follow. I want to touch on the visit to the u. S. He says you cant go to houston and not talk about energy. It imports most of its oil needs. And whatficant is it, kind of a deal do you expect to see . I think they already signed one large deal with the natural importpany, which could they may look at giving some clearance to buy some of those prohibited areas, and disturbance that south arabia had is already coming to an end. We are already seeing the oil price softening. It will not have a bad impact on the Indian Economy. Where are you seeing the opportunities . Which are the industries likely to benefit from this reduction in Corporate Taxes . I dont know specific names but our primary focus is on banking and financial policies. Be a verye banks will althoughction, recently goldman pumped a lot of capital into the Public Sector, and many Public Sector banks are not making enough money. Banks, financial institutions, and some of the nonbanking financial institutions, got very Good Management and that will be our target. Thank you so much for joining us. Lets have a look at the indian futures as we head toward the indian futures with more gains after the stellar rises we saw friday. , just edging lower at 6. 70 . The market open is three minutes away. This is bloomberg. Lets get you up to whats happening, just a minute away from the start of the trading day in mumbai, Morgan Stanley raising its target to 45,000, thats about a 4. 3 percent uplift from where we are at the moment. And Earnings Growth will also be better and they have raised their Earnings Growth for 25 in the fouryear. Gaining afterre the gst announcement coming through, just going to get you now to the open, starting right now. Lets get to mumbai, and go through what we can expect. Biggest gain in the decade for indian equities. Not quite as much as one would have thought. Going by what the screen is Indian Markets are now dancing to its own tune, agnostic as to whats happening to the asian markets. Nifty is trading above the mark and this morning traders will be , uphing out for the markets aout 3. 2 , and this is after 5. 5 increase on friday with gains of about 1200. It rallied the most on friday with the index up about 1. 9 . Remember, the move that was of the markett participants have highlighted it is structural in nature which means we will need to upgrade. Stanley butgan other houses from the likes of Goldman Sachs to ubs, all of them have upgraded targets for , for example 13,200 of the targets that were played down in june 2020. Ties and theyed are all witnessing gains between 5 and 12 . They have reduced the gst rates for the companies. Apart from those hotels you mentioned, what else are you keeping an ion . Clearly auto stocks, these were the companies where a majority of the positions that were added in the last two to hikes onths 10 friday are up another 4 and after that we will see buying coming back into these auto companies. That stock reacted marginally in but it is still trading with gains of 1 after the company said they will be considering to hike. All right. Thank you so much for that. Ceol to come, the we work has its biggest investor saying they want him gone. More details next. This is bloomberg. Chinas tech stock board is no longer the talk of the town, andes trading slowing down our china markets editor why are investors going so cold on this one . You would have expected andgs to be hot initially, months before it first went into effect use also love those stocks separate. We saw this initial action in the middle of october that has really slowed down, volumes hit the lowest level yet, the lowest level since we saw it in july. Is it too early to say whether the launch has been successful . I would say it is too early to say. We had 35 stocks initially in july 22, when it first went into effect. We have only had four ipos since then. We had four more in the pipeline aboveey were all well what they were trading at. We just need more stocks to get a sense of how it will fare. China markets editor, thank you so much. Up,issues continue to pile Office Startup we work says some members of the board want the ceo to stand down after the muchanticipated ipo. Lets bring in selina wang with the latest. Went to we know about this . Is going to be a Board Meeting this week were some directors are expected to encourage newman to step down and take the position of the nonexecutive chairman. Newman very quickly went from a celebrated startup founder to a highly contested, controversial figure and theres been a lot of doubt among investors around his management and personal performance, the overtop the culture he has created in the massive financial losses for this company. Theres been an onslaught of negative news in time is very short. They need to move quickly. If they dont complete the ipo by the end of the year, they will lose access to a critical 6 billion loan. Softbank has been the biggest shareholder what do you think they are making of it . And hea two day retreat, didnt show up to that and that signalsending the right and no doubt they could be playing a role in all this conjecture of trying to oust him. Severus is have told bloomberg that Masayoshi Son is backing the plan to remove adam newman as the ceo, and this is a very big deal since he had previously multiple times reiterated that he was a big fan headam newman, and personally backed him as the ceo. Its a big reversal in his thinking, but of course its a very big deal that this ipo be successful in the hope is that by removing this controversial figure it smooths the path to an ipo. If you look at the ipo prospectus it shows that given the amount of shares he controls he has the power to house the entire board. Haveact that they considerable influence, is backing of this plan certainly increases the chances it can be done. It is not surprising that he is losing patience with this company. They invested in january at a 47 billion valuation, and if you look at the ipo price that it could be going public at next month, it is only going to be 15 million or less and some people even think that is a long shot considering this company has not turned a nickel in profit after raising more than 12 billion. Thank you very much. Selina wang, joining us from beijing. Lets have a look at the other things which are going on on our radar, no doubt Monetary Policy will be one of those things as well as Economic Data. The reserve bank of england could be unchanged on wednesday after a 50 basis point surprise , this is. The bank of thailand will be weighing what it needs to do and Bloomberg Economics expects them to stem the rising barge by cutting here as well. Central bank is slash thelso to Interest Rate as it continues to grow and right now we have trade data not just because of this ongoing trade spat but with all the protests taking place. Profits are due on friday, and we also have them as a victim of the trade conflict and we may will see a drop in factory deflation and slowing production. Exclusive also our interview with the former u. N. Secretarygeneral ban kimoon at 12 00 p. M. In new york. Singapore, talk to us. Watch on keeping a both indian stocks, since sex doing gangbusters, currently up by 2. 6 . Modi announcing those tech stocks, giving a lift to sentiment. It willions are that affect investor confidence, and having said that there are issues that they need to address which include fdi regulation and lots to be addressed. Letsx is up 2. 6 take a look at the rupee and take a look at where hotel stocks are doing. Lift, upalso getting a and of course we had a cut in gf t hoping to boost assets. 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