Syria. The move comes days after washington effectively okayed the operation. The u. K. Government pushes ahead with brexit, although the current eu president says there is no chance of a deal this week. Shery later in Bloomberg Technology global link, we will outline the possible rescue plans for wework and what softbank can do to save the struggling unicorn. Lets get you started with a quick check of the markets. U. S. Futures at the moment unchanged after stocks fluctuated between gains and losses throughout the session. The s p 500 was led lower by utilities and materials. The Energy Sector down as wti lost the most rampant about two weeks, 53 a barrel. Investors still trying to figure out what a partial u. S. China trade deal actually means. Acrosslots of anxiety markets. Pretty light trading. We saw about 30 below average volumes when it comes to the 30 day average. We had u. S. Debt markets close away on holiday, so pretty thin trading. The focus this week now switching to earnings season. We are taking that off with big banks. Jp morgan and Goldman Sachs reporting tomorrow. We have Morgan Stanley later in the week. Lets see how things are shaping up in asia. Sophie futures looking somewhat being castia without over the handshake deal between the u. S. And china. Ongoing protest in hong kong could cast a shadow with the u. S. Congress as it votes on the democracy bill. Kiwi stocks started the day, up about 4 10 of 1 . We are seeing a lack of conviction overgrowth in bond ankets again with trade irritant for the cycle, not a disease. The imf will lower forecasts when delivering its Economic Outlook this week. Kiwi and aussie bonds heading higher here this morning. On monday, leading the rally over pessimism which got the pound to slip, but now recovering a touch on the telegraph reporting lastminute compromise is. A quick look at your calendar this tuesday in asia. Take a look at that. We have chinese inflation, japanese factory output, as well as trade data from india and indonesia. Rba minutes are out later this morning. Haidi. Haidi a lot to look forward to. This get the first word news now. Ritika thanks. China is hesitating over President Trumps partial trade deal, saying more talks are needed before any signing can go ahead. Sources in beijing say the vice premier may lead a delegation to hammer out more details of the potential agreement which could then be signed by president xi and trump next month in chile. China wants the u. S. To abandon planned tariff hikes in december. The current president of the European Union says there will be no brexit deal before this weeks summit. The Prime Minister of finland says time has run out to reach an agreement before thursday. The news came as Queen Elizabeth delivered the traditional speech outlining her governments legislative agenda. Boris johnsons plan includes a general election on the brexit strategy. The protests in hong kong may have taken a dramatic turn with police saying a homemade bomb was detonated on a patrol car this sunday. The device was set off about 10 meters from a police car. No one was hurt in the exposure, but police say it is clear the intention was to kill or seriously injure officers nearby. Police say the bomb requires knowledge of chemicals. Retail inflation in india climbed to its highest level in more than a year, posing a challenge for the rbis aim of maintaining an easing policy. Consumer prices rose a fraction below 4 from a year earlier, higher than the estimates in a Bloomberg Survey and faster than the revised figure for august. Inflation jumped after heavy monsoons damaged onion and tomato crops. Global news 24 hours a day and on tictoc on twitter and more than 120 countries. Tika gupta. Mike live pictures of pence and Steven Mnuchin speaking at the white house right now on those sanctions on turkey. Earlier, secretary mnuchin had said the u. S. Would be sanctioning the turkish defense, energy and interior ministers. Three of turkeys minister chiefs will be sanctioned. U. S. Will general it issue general licenses for humanitarian work. Saying the licenses will allow turkey to buy fuel. Vice president pence saying President Trump spoke to president erdogan, saying the u. S. Wants a ceasefire. Our managing editor for russia, africa and the middle east Benjamin Harvey is monitoring developments. He is in d. C. Right now and watching these talks as they continue at the white house. Teeth do theseh sanctions actually have on turkey . Benjamin so far, i think these sanctions are mostly symbolic. If you look at the Market Reaction, that is also what it is indicating. The perception is the u. S. Is being much more cautious on turkey then some of the extreme rhetoric would suggest. Trump and other u. S. Officials have for some time now been morning they would take measures to absolutely destroy the turkish economy. So far, that is not what we are seeing. Haidi if you say this is largely symbolic on the conservative side, is there any will affect how much further the administration will go . Benjamin if the question is it will be effective in reversing turkeys invasion into syria, that would be no. Erdogan said no amount of pressure would prevent them from continuing this operation. They will continue with them. The question is whether the u. S. Will continue to escalate sanctions until he gets to the point where they do do real damage to the turkish economy. Shery tell us what is happening on the ground in syria because we have heard hundreds of Islamic State supporters have escaped. Benjamin events on the ground are playing out exactly as expected. Youve got turkey going in there, very quickly secured this buffer zone it wants to create in northern syria. You have the to have been abandoned by the u. S. They decided to make a deal with russia and with the syrian president assad. On the background of that, Islamic State prisoners who have been held by the kurds are either being released or escaping. This has all been predicted, including by Donald Trumps advisors. What is a surprise is the speed with which it has happened. This has unfolded over the course of six days. Haidi in terms of the investor reaction, we are seeing continued pressure on emerging markets equities as well as stocks. Turkish assets coming under pressure. Is this likely to be muted a little bit given the moves were not perhaps as aggressive or hawkish as people were expecting . Benjamin so far, that is the perception. That it is definitely not worst Case Scenario for turkey. That said, there is some damage already being done. The lira has weakened fairly significantly. If this continues, you could have a situation where people talk about the stability of turkish corporate debt. You have the central bank that is looking to cut Interest Rates to revive the turkish economy. They will probably have a harder time finding the justification to do that now. Haidi benjamin, thank you for your time. Our managing editor for russia, africa and the middle east. The lira continuing to be the worst performer in the emergingmarket basket. We are getting more lines ebbing out from Vice President mike pence speaking at the white house. Saying trump spoke with frances men well micron emmanuel ma cron, saying the sanctions imposed on three senior ministers is just the beginning. They will continue those sanctions until turkey agrees on the ceasefire. We believe that story for now but it is continuing to develop. Lets go to china where the country seems to be pretty paused on President Trumps mini tree deal trade deal. Treasury secretary Steven Mnuchin says there are plans for more negotiations. Tom mackenzie is watching all of this in beijing. We were cautioning yesterday against to much euphoria in the markets for this day one mini deal. It seems like beijing is pouring cold water on these developments as well. Tom absolutely. Our sources telling us negotiators want to return to washington, potentially led by the chief negotiator of the chinese aside, the vice premier, to iron out some of these details before they plan to sign this potentially at the apec summit in november. They want to get more of these details locked down before they put it in front of president xi jinping to sign. There is reason for that caution. May 2018 was one example when the chinese came back from negotiations with the u. S. , thought they had some kind of deal. It looked very much like the phase one deal we have now. Then, trump did a uturn and they were left looking rather humiliated. You are seeing that in the language being displayed here, as well as the fake media is reporting. They are talking about substantial progress but they dont want to be touting something that maybe ripped up before their very eyes in the next few weeks. They want to avoid that humiliation. The other thing our sources tell us, the chinese are pushing for the potential tariff icon december. That is not going to happen. They are pushing for the same kind of action from the u. S. On december 15 as well. By the way, in terms of how committed china is to this deal, watching the yuan, according to the likes of capital economics. They say we should be watching for signs of china may be supporting the currency as a goodwill measure to try to appease some of the concerns in washington. Shery pretty flat for the last 15 trading sessions or so. We continue to see violence in hong kong. We have heard trump repeatedly bringing the hong kong issue up, saying president xi should actually meet with the protesters. Does this tie into the trade negotiations at all . Tom there is the concern that hong kong ends up being a factor that both sides have to contend with. In fact, President Trump in comments to the vice premier, says it looks like things in hong kong are calling down. The evidence suggests that is not quite the case. We have had reports of remotecontrolled explosive device potentially targeting police in the city. Violent protests as well as peaceful protests have continued in the city. It seems like trump once to keep hong kong as a side issue. Affect not want it to the trade negotiation. Members of his own party, like ted cruz, in the city to show support to hong kong. We have the legislation going through the motions in d. C. Bipartisan support for legislation that could see this annual check in terms of Hong Kong Special trading status. All of these things are moving forward and it could be the timing forces hong kong to become an issue when it comes to these trade talks. That is another concern for markets. Haidi tom, thank you foso much. Tom mackenzie in beijing with the latest on trade. Still ahead, Malcolm Jeffrey takes the global temperature with a look at what businesses are doing when it comes to hiring, firing and expanding. Pulaski saysjake expect positive market catalysts this quarter. We will have his analysis just ahead. This is bloomberg. Shery i am shery ahn in new york. Haidi im haidi stroudwatts in sydney. U. S. Stocks ended slightly lower as investors weighed the partial trade deal that President Trump been touting as well as reports china wants more negotiations before president xi jinping will sign the deal. Tpw Investments Management jay pelosky sees progress ahead. He joins us from new york. Great to have you. I want to start out with this chart that illustrates the mood we are seeing when it comes to Equities Trading at the moment. We are seeing bulls try to set up the highs. Within 1. 8 of a high for the s p 500. We are looking at this range bound backandforth session at the moment. Is this just the fact we are seeing the old playbook of avoiding the growth sensitive stocks, growth sensitive currencies . Buying bonds. At the end of it we are at the end of the cycle. Jay i think you are right that markets have been range bound. For us, that is one of the four factors that makes us bullish and looking in a risk asset rally to fall. Markets have chopped a lot of wood. There has been a lot of negative issues in the last months. Equities are only 1 or 2 off over the last three months. Bonds up 1 , 2 . That is one. The second is we believe Global Growth is bottoming. Pmis are starting to bottom. In autos and semiconductors, two main parts of the industrial complex, are also trending up. That is the second factor. Our third factor is we believe geopolitics are finally stabilizing. This has been an overhang of uncertainty for markets all year. Yet, i believe we are at the point where Everybody Needs a win. President trump could use a win. President xi could use a win. Force johnson could use a win. The eu could use a win. Fourth, and most importantly, the policy mix has changed very much for the better. In our own work, we call it the global risk this. Policy over the last 12 months, where we are today and policy versus a year ago a lot of people were talking about that q4 would be the same as last years devastating q4. For us, policy is much better placed today than it was a year ago. Our outlook for Economic Growth has really turned up. For us, we are positive. We think risk assets will rally through the course of the fall. Haidi is it really the second part of the year thesis that will drive any breakout . If you look at the trade, potential brexit deal, notwithstanding there is very Little Details about what or when we might get out of these negotiations. It is one facet looking at the downside pressures on the u. S. Economy and growth. Jay you are absolutely correct. The way im starting to think about it i think we are in one of those rare periods where good news is good news for risk assets, and bad news is good news for risk assets because it brings more of a policy response. Everybody is concerned about global recession. Everybody. You will hear from the imf, world bank, everybody. Bad news today is not bad news for risk assets. It is actually good news because it will bring more of a policy response. We have seen that with policy bank easing. The only bad news is the status quo where there is really no change. To your point, we need a catalyst and the catalyst could come from clear signs of global Global Growth bottoming which is significant implications for Asset Allocation and signs of improvement in the geopolitical front. Shery re nearing the front where bad news will simply be bad news . The bloomberg chart showing the manufacturing slump globally. We are talking about the u. S. , china, japan, there was own all under 50. In the u. S. , we have seen this transmit in the manufacturing side of things. Jay i dont think so. We are of the view that the Service Sector will hold up. If you look at the developed economys unemployment rates, that is record lows translating to record High Consumer confidence which suggests robust consumer spending. You highlighted it. The pmis have a repeat. Jp morgan has done a lot of work on this showing you move from an under 51 and declining manufacturing pmi to an under 51 and rising pmi, the shift in return can be four to five times greater when you move when you start to inflect upwards. We believe that is where we are. If you look at jp morgans work, and hasi is turning up been up for the last two months in a row. We want to start to position for that. Shery does that factor in potentially more tariffs coming up in december on chinese products . It could potentially steal christmas from u. S. Consumers. Jay lets hope not. I have kids. Stealing christmas is not a good thing any parent would want to have happen. The tariffs in december all right open question. Im surprised that was not really addressed in the talks last week in washington. We will need to see how that plays out. The pmis bottoming means you need to shift from bonds to stocks. You need to shift from the u. S. To nonus. You need to shift from growth to value. And, you need to shift from defensive to cyclical. What we are trying to tell our clients, and we said in the monthly piece, what we are trying to tell our clients is it is time to start moving a portfolio in the direction of this. Because the downside is limited. And, the upside when the shift comes, it comes fast and hard because everyone is positioned in bonds in the u. S. , in growth and defensives. Shery we are too bearish at this point. Jay pelosky, very optimistic at the moment, tpw Investments Management. You can get a roundup of the stories you need to know to get your day going in this edition of daybreak. Go to your terminal. Also available on mobile on the bloomberg anywhere app. Plenty more to come. This is bloomberg. Haidi this is Bloomberg Technology global link. Alongsidestroudwatts shery ahn and taylor riggs. Lets take a look at the top global tech stories from today. Taylor apple is under fire for setting rousing data including ip addresses to tencent. The Foreign Company struggled with how to work in china. It is part of an iphone and ipad security feature that warns users if a website is malicious. Apple checks addresses against a list of sites known to be problematic. That list is maintained by tencent for china and for google by other regions including the u. S. Uber has fired 350 more employees and what it says is the last wave of staff cuts. The terminations affect several divisions, including selfdriving Car Development and food deliveries. Ubers stock is about 30 since the ipo in may with investors concerned about rising losses and slowing growth. Is closenn tech outfit to securing 2 billion of new financing from investors, including softbank. It will be split equally between values it debt, and at 16 billion. Talks in the final stages in terms of and terms can still change. Those are the top global tech stories i am watching. Shery wework is considering a bailout that would hand over control to softbank. The japanese giant is convinced and can turnaround the one time startup. Ellen huet covers wework for us. We know softbank is already the largest shareholder so what would this mean . Ellen this mean softbank could potentially be putting in even more money on top of the 10 billion it has invested in the Company Since 2017. One of the plans being discussed for wework is having a softbank bailout in which the company would invest a certain amount of money and take likely control of the money in order to save it. It is running into a crunch for cash. One of the other options is getting a debt package of 5 billion from a group of banks led by j. P. Morgan, one of the leading underwriters of the ipo that ended up not happening. Taylor is this good or bad for softbanks reputation . Ellen i think this is a case where these are entities that have already invested a lot, not just moneywise but also the reputations in the outcome of wework. There is not just an incentive to save their Financial Investment but also to save face. They have a lot invested in a lot running on this investment and having wework end up working out. I can imagine for softbank, it feels like there is a lot on the line. If they managed to turn it around, it could be good because if it doesnt, this will be a big scar on softbanks record. Shery which one of those two options would be better for wework . Ellen we dont know which one they are favoring. Executives will meet this week to discuss more. Our understanding is that a debt package could be slightly preferable to the softbank deal and it would dilute the current stakeholders a little less. It is all up in the air and we will be following it as it develops. Haidi thank you so much for that. Ellen huet, thank you for the latest on wework. That is Bloomberg Technology global link. Dont miss Bloomberg Technology 8 a. M. In sydney, 5 a. M. In hong kong, 5 00 p. M. If you are watching in new york. This is bloomberg. From the couldnt be prouders to the wait did we just winners. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. Now you can share it between lines. Mix with unlimited, and switch it up at anytime so you only pay for what you need. Its a different kind of Wireless Network designed to save you money. Save up to 400 a year on your wireless bill. Plus get 250 back when you buy an eligible phone. Call, click, or visit a store today. Haidi it is 9 30 a. M. In sydney. The market open is about 30 minutes away from being upon us. Futures pointing to a pretty muted start. Looking at indicator declines of a half a percent when trading begins following a lukewarm session on wall street overnight. Investors digesting the possibility that the trade deal between u. S. And china could be further ahead of us. We had reports that beijing is looking to hold more talks with president xi jinping signing off on this mini phase one deal that President Trump had been touting. Rba minutes on tap later today. Im haidi stroudwatts. Shery im shery ahn. You are watching daybreak australia. Lets get the first word news. Ritika hong kongs defective central bank is lowering the capital to support the weakening economy. The chief executive says the buffer will come down to 2. 5 to 2 immediately to allow lenders to be more supportive. He also said indicators are signaling the hong kong economy has deteriorated significantly since the protest began in june. Police and protesters clashed at barcelona airport as the argument burst back to life. Demonstrators gathered after the separatist campaign were jailed, some for 13 years. It triggered an angry response of a coach who is a supporter of catalan independence. He described the ruling as an except about. India has partially restored Communications Two months after the regions autonomy was downgraded amid a security crackdown. Land lines were back last month, but the ban on more than 2 billion mobile connections and Internet Services will continue. New delhi say separatists may use the internet to provoke antiindia protests calling for independence. President trump is to impose sanctions on turkey for its military incursion into northern syria. The statement comes days after he effectively cleared the way for the offensive i pulling u. S. Or forces out of the area. It will raise steel tariffs back to 50 . The turkish army claims to have killed hundreds of terrorists since the incursion begin last week. Global news 24 hours a day, on air and on tictoc on twitter, powered by more than 2700 journalists and analysts. Im ritika gupta. This is bloomberg. Shery australia opens at the top of the hour. Lets turn to sophie for what to watch. Sophie keeping an eye on evolution after the minor reported a drop on Fourth Quarter output what it is indicating the full year target with stronger gold prices. Evolution boosted its cost guidance due in part to operational given his issues. The chief executive addresses shareholders on his turnaround plan which has seen headcounts cut by about 6000 this year. According to the chairman, who this year confirmed guidance for fiscal 2020. Watching australian banks after the regulator imposed new measures. Its reviewing the discussion. Haidi thank you for that. Lets get more on what we should be watching x trading gets underway in asia. Andreea papuc is with us. Yesterday, we were cautious about assessing the markets, getting ahead of ourselves before we have the details on the mini deal. It seems like we were right to be cautious. Andreea that is absolutely right. The market remains volatile to these trade talks. It seems like we have been here so many times before the last 12 months. You ha thehree days of gains last week. When china came out and said it does what more discussion, you did see some of those gains peter out. There are mixed messages investors had to deal with. We had a story that pointed out a lot of the notes from analysts are still using uncertainty and being cautious. Even though it still remains the biggest focus for investors, the Market Reaction to any news on the trade progress is getting increasingly smaller. Theave a chart that shows trade negotiation is having a smaller impact on trade stocks. A year ago, benchmarks were rising and falling but much more. Now things are far less severe. We are 12 months down the track. It seems donald trump and xi jinping have that november phone call last year when we saw indexes rising by much more. A lot this year has been characterized by this one step forward, two steps back in trade negotiations. We had Morgan Stanley come out and warned investors not to get too carried away, not to jump in and the latest truce. Perhaps friday, the shortterm highs we have seen. A lot of caution out there despite what seems like some relative progress in the straight talk. Shery really interesting, we are seeing huge foreign inflows into south korean bonds when returns there are among the lowest in asia. What is going on . Andreea that is right. Investors have been piling into south korean bonds. Their returns have been boosted by currency hedging. In local currency terms, korean bonds have returned among the lowest among 46 sovereign bond markets tracked by bloomberg. Part of the reason is while bank of korea is widely seen as cutting rates tomorrow, most economists actually see pausing after that. You have the central bank stated it sees monitored policy already quite accommodative. Korean bonds have underperformed. U. S. Treasury, 10 year yields have fallen ahead of the pace of despiteasuries thi inflationary pressure. The bank of korea is widely seen as less aggressive than the fed just a lot more headwind than in the u. S. Certainly more conservative than Central Banks in australia and new zealand that have cut rates more aggressive recently. Shery thank you so much for that, our Bloomberg Cross asset asia editor. You can find her charts on the library on the bloomberg. The pageantry of Queen Elizabeths speech laying on Boris Johnsons brexit vision did little to boost confidence in the Prime Ministers plan after the eu said it is not ready to sign a deal yet. Our Global Economics and policy editor Kathleen Hays is here with the latest. What did the queen say exactly. . Kathleen this is a speech the queen often gives. She lays out the Prime Ministers plan for the coming year. You can see her sitting down and the house of lords getting ready to speak. She did talk about health care, immigration, other big issues for the british people. Key to the whole thing is getting a brexit deal passed. Heress what she said. Queen elizabeth my governments priority is to secure the united kingdoms departure from the European Union on october 31. My government intends to work towards a new partnership with the European Union based on free trade and finally cooperation. Kathleen Boris Johnson, like theresa may before him, saying this is the number one job to achieve. In a statement that accompanied this beach by the queen, she said people are tired of gridlock. That a want to wait any longer to leave the eu. It is a very complicated situation because he needs to get the deal done by the end of the month. At the same time, he has so little support in his own party. Far short of a majority in parliament to get any deal that is passed. People are waiting for him to call an early general election. Jeremy corbyn, the labour opposition leader, said its nothing more than fools gold. Finland holds the rotating eu presidency. It is not exactly helping Boris Johnsons cause. What did the queen have to say . Kathleen the finish Prime Minister is pretty clear, theres probably not time enough ahead of this big eu summit to get something done. No time in a practical way and legal basis to reach an agreement before the council meeting. It is possible to negotiate after the council meeting. If that is the case, it would be so. It is a very tricky situation for the eu as well because they have to decide by wednesday if there is going to be a deal that can be voted on, that can be even signed during the two day summit. They have not gotten there yet. The Prime Minister comments came after a day after the chief eu negotiator said the irish border plan presented by Boris Johnson so far lacks detail. Its interesting. The telegraph is reporting johnsons inching closer to some kind of deal for a hybrid agreement with the Democratic Unionist Party that would allow it would mean Northern Island is not left ireland is not left entirely in the eu customs union. Theresa may seemed so close to get a deal but it was always the irish backstop nobody could get over. It remains the principal point as well. Shery Kathleen Hays, thank you so much. With the latest on brexit. In the u. S. , a flood of Bank Earnings grabbed the spotlight later tuesday as j. P. Morgan kicks off citigroup the reporting season. Investors will focus on the Interest Rates, political concerns and botched ipos. Ofkeenan, that mentality lower for longer will not help these banks. Su a lot to watch on the financial front and it had to do with the crowded calendars. J. P. Morgan kicks it off, followed by Goldman Sachs. Citi, wells fargo, blackrock. Bank of america on wednesday. Morgan stanley on thursday. If you look at the way the stocks closed, they were the outperforming group in this latest session, ending with their gains with some of the other market stocks giving their gains back. This quarter is excited to be challenging for banks from a revenue standpoint. The sixth biggest banks have been declining as much as 13 billion since the start of the year. The yield curve. The Interest Rate sensitivity. Lower borrowing costs could help stimulate more loan demand. And then we have the trading revenue. Will it come to the rescue . A lot analysts say not likely. Thanks to the market volatility, three of the five banks, j. P. Morgan, chase and bank of america, are expected to post higher revenue city over here. Things that will be watched closely by investors. Haidi also closely watching the impact from a weaker environment, ipos too, right . Su ipos exemplified by the wework disaster. J. P. Morgan was a key investor. If we look at the ipo weakness, it underscores a lot of these investment banks are dependent on these big fees and those are under pressure. Jp morgans lending to wework will also be in issue. If we look at the issues facing j. P. Morgan, analysts say it is expected the Market Opportunities will support revenue but the cost mitigation will be a key issue not just for j. P. Morgan, but all the banks as we go through the earnings. Haidi su keenan with a look ahead. If you are away from a screen, you can fight indepth analysis and the dates newsmakers on bloomberg radio, now broadcasting live from a brandnew studio in hong kong. You can also listen on the app. Bloomberg radio or bloombergradio. Com. This is bloomberg. Haidi i am howdy stroudwatts im haidi stroudwatts. Shery im shery ahn. Optimism over last weeks partial trade deal between the u. S. And china seems to be fading away. China calls for more talks before it signs on the dotted line. Where does aco stand on the tariffs . Jeffrey weiner is chairman and ceo of markem llp, one of the largest independent accounting and Advisory Firms in the u. S. It is great to have you with us. Let me bring up this ceo survey with Hofstra University which i found really interesting. You are saying according to the 300 ceos that actually responded theyis survey, 46 say think the u. S. Trade policy is beneficial as opposed to 33 who think it is harmful. You would think all of the uncertainty over trade would really make the ceos pretty hesitant. Jeffrey first of all, thank you for having me. Exactly an not overwhelming endorsement of the trade policies. I think it is pretty well split. There are certain ceos who feel this trade policies will bring jobs back to the u. S. And will make the u. S. More competitive with china which has historically been a low price competitor. It has unrealistic government subsidies. While 43 think it is harmful. I dont think there is any 33 rcut indication, 46 , is pretty close to me. But there is still an uncertainty that is affecting the market and affects both middlemarket companies, publicly traded companies, and the investing public. Shery i want to see how your business is you actually advise her thinking about what came out of this week. Because the take from what was accomplished seems to be different from washington to beijing. The influential global times editor and chief in china actually tweeting, based on what i know, u. S. China trade talks made a breakthrough in the two sides will reach a final deal. The official statement is moderate. Does not mean chinas real attitude is not positive. The chinese a statement seems to pour cold water to the fact there is a trade deal in place. What does your business think was achieved this week . Jeffrey President Trump announced phase one of a potential deal. You never know with President Trump whether he is announcing something on twitter just for the rise of the moment or to deflect another story. While the chinese are more tempered. It is good news they are talking, but i think both governments are under pressure. Both governments, both economies are feeling the pressure of this trade war. Right now, nobody is winning. I think it is a matter of who blinks first. Haidi how much does it substantially matter in the sense that one many deal is not going to be the next magical fixer for the u. S. Economy or investor sentiment. Do you think for these companies, it is going to be enough to suddenly reverse what has been dented in the last year and a half . Jeffrey i think ending these trade wars is essential. Companies are holding back. They are holding back on hiring, holding back on capital expenditures, holding back on expansion. Having trade wars and the uncertainty does not help the economy whatsoever. Haidi we were talking earlier about looking ahead to u. S. Bank earnings and the dismal, disappointing environment and has been for ipos. What are the other factors that play into it because obviously the trade war is one issue plaguing investor sentiment, growth and profitability among companies in the u. S. At the moment . Jeffrey investors are becoming more discriminating about ipos. The wework disaster people were looking at the numbers now and looking at the Business Model and really questioning whether a company that wants to go public does have a sustainable Business Model and they will actually make money. Weve had uber, lyft, probably disappointing ipos at best. Paladin was trading below its initial ipo offering. Investors are becoming more discriminating on where to invest. Shery some people are calling at the wework flu that is investing everyone that does not just want to see sky high valuations. What does this mean for the ipu o market . Jeffrey there may be a shortterm blip with investors becoming more discriminating but i dont think they are buying these sky high valuations. A month ago, wework was valued at 47 billion. Now a company that could be worth 10 billion, 15 billion at most. Investors are taking a deep dive into the numbers. And the Business Concept really works and if it is sustainable. Haidi lets talk about the macro environment because the job market in the u. S. Is pretty tight. We have seen this demand for professional services. What happens if we see more impact coming from manufacturing slumps affecting these businesses . Jeffrey certainly, unemployment is at historical lows. It will not stay this way. The economy goes in cycles. Unemployment goes in cycles. It can only go in one direction. It is only a matter of when. If these trade wars continue the Auto Companies are producing fewer cars, exporting fewer cars. Exports in general the farmers are suffering. There are no farm exports to places like china. All of these things will eventually result in either permanent or temporary layoffs. Haidi with inflationary expectations so muted and growth dismal or at least concerning around the world, it does not look like the fed will let up even if we get a phase one trade deal. You mentioned impeachment being something that could potentially negate any positive impact of fed stimulus. Are we not paying enough attention to the impact of domestic politics on this . Jeffrey oh, there is so much whether it is the economy, politics there is so much uncertainty and things up in the air. I actually think the fed probably has at least one or two more rate cuts planned. It seems like that is a certainty. The economy is slowing. It has not shown up as much in the stock market or employment figures but those are indicators. Uncertainty,f this whether it is the trade war, Political Climate in the u. S. , none of this helps the economy on a longterm basis. Note, on that optimistic really great to have you. Ceo. Ey weiner, marcum llp we will have a lot more on the trade deal, how it is playing out on the tech world. Tara wheeler joining us in the next hour. Later on, we will be going to the bloomberg summit taking place in mumbai. Focusing on diversity and inclusion. Bloomberg tv has exclusive interviews. The chief diversity officer and ikea india ceo will be joining us. This is bloomberg. Shery i am shery ahn in new york. Haidi im haidi stroudwatts in sydney. A quick check of the latest business headlines. Harley davidson is halting production of livewire, the electric bike. It says it found an unspecified issue during quality checks and stopped output and deliveries for additional tests. The ceo has positioned livewire as key to attracting a new generation of bike riders. Harley has suffered 10 consecutive quarters of declining u. S. Sales. Shery india has temporarily halted jfws pursuit of steel, amid allegations of Money Laundering by the former owner. The ceo had appealed to the company court, seeking immunity against future litigation after Bhushan Power with alleged fraud. The deal is a blow to the modis governments effort to deal with bad debt. Haidi set aramco says facilities damaged by missile strikes are back to normal after a month. The company is currently pumping nearly 10 Million Barrels of oil a day, the same level before the september 14 strike. Aramco attacks inflamed tensions in the golf with iran being blamed. Tehran denies any involvement. That is almost it for daybreak australia. Trading in new zealand is already underway. It looks like we will start off on the back foot when it comes to trading in sydney. Futures pairing earlier losses but looking at declines of under. 5 at the open. Tracking the muted sessions on wall street. The dollar holding. Still waiting for more details of the many trade deal and these negotiations that beijing is reportedly demanding before xi jinping will sign on the dotted line. In terms of the agenda today, we are looking ahead to chinese inflation data, as well as inflation. Looking to those given we have had poor trade numbers. The decline in import demand in china as well as what is a big week for chinese data. Rba Meeting Minutes out in the next couple of hours as well. That is about it for daybreak australia. We will be sticking around over the next few hours for daybreak asia as the market open is almost upon us. Cindy futures down by 4 10 of 1 . Weve had japanese markets coming back online after the long weekend as well. This is bloomberg. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. You can share 1, 3, or 10 gigs of data between lines, mix in lines of unlimited, and switch it up at any time. All with millions of secure wifi hotspots and the best lte everywhere else. Its a different kind of Wireless Network, designed to save you money. Switch and save up to 400 a year on your wireless bill. Plus, get 250 back when you buy an eligible phone. Thats simple. Easy. Awesome. Call, click, or visit a store today. Heidi very good morning. We are under an hour away from market opens in japan and saudi arabia. Sophie welcome to daybreak asia. Haidi our top stories this tuesday not so fast china wants more talks from President Trumps major trade deal, saying
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