Up 3. 6 . That was widely expected as we see more risk out there but unchanged, the central bank in china offering little relief to bond traders. Last week, massive cash injections. Yields are probably here to stay a bit longer. The mainland mod market having a solid year but quite a few headwinds could keep it under pressure. Phase one trade will looking like it could be signed. That should bolster the Economic Outlook after thirdquarter gdp averted a print below the 6 level. We got chinas new order supported by market stimulus. Boost if trade tensions ease with regard to that. 1. 85 on the treasury 10year. That is the position we find ourselves in. Su keenan is in new york with first word news. Su we start with boris johnson. The Prime Minister is going to try again on tuesday to get parliament to allow an early election after failing on monday to get the two thirds majority needed to push it through. Johnson says he will present a similar version of the legislature which will pose a date for the election and need only a simple majority to be approved. Monday, the u. K. Accepted a threemonth brexit extension offered by the eu that eliminates the possibility of a no deal exit this week. The house of representatives will take its first vote thursday on whether to support the ongoing impeachment inquiry of president trump. The vote aims to nullify republicans main complaint that the inquiry process is illegitimate. It will be the first chance for all house members to be on record as supporting or rejecting the impeachment process. Set tong, the ceo is take the hot seat before a Senate Committee on tuesday and admit that the playmaker made design mistakes on the ground at 737 max. Of the testify in front senates Commerce Committee on tuesday and according to an advanced copy of his testimony, insists the Lessons Learned will contribute to safer aircraft in the future. His testimony coincides with the oneyear anniversary of the lion air crash that killed 189 people. Curbs on hiring chinese talent are hurting technology companies. This, according to a former google ceo. 10 chmidt, now a top pentagon adviser argues the u. S. Restrictions on recruitment and information sharing with the country are counterproductive. He spoke at the Stanford University is that calling for access to chinas top scientists. The Trump Administration is weighing more escort export bans on Critical Technology fields. Global news 24 hours a day, onair and online on tictoc and twitter, powered by more than 2700 journalists and analysts in. Ore than 120 countries im su keenan. This is bloomberg. Whatad just getting to every limit saying at the moment, speaking about the Early Release of this murder suspect, a person who did arguably commit this murder in taiwan. Whether he would go to taiwan. Shes commenting on that and more. Than the others who hold a different opinion will resort to the sort of intimidation. Theres no dispute about that, and thats why i notice that in one of its interviews, the commissioner described this soso media intimidation as being a weapon deployed, which is worrying, and i have also set on a previous occasion that in time, we will have to revisit the privacy legislation to see how we could tackle this emerging stretch or problem. There is also no dispute that the main target of this is the police, the police officer. I gather that over 2000 policemen and maybe their families have been put to that sort of intimidation, so for the commissioner of police to take ant route of applying for interim injunction is understandable because we dont have the necessary effect of deflation to tackle that issue. Injunction is one of the legal means to address the problem. That is point number one. Point number two, assistance offered. As i told you on a previous occasion, before he was released from correctional institute, he sent me a letter expressing his determination to turn himself in to taiwan and accept the responsibility for what he has done, and he also asked for the governments facilitation and assistance, but he is a free man so facilitation has to fully respect that he is a premium. He had a free man. He has a free will. The lawenforcement agency of hong kong has approached a Law Enforcement agency in taiwan to see what arrangements can be placed to facilitate his return to taiwan. But the matter is complicated by different and confusing messages coming from the other side, so i was just responding to a question in cantonese that right now, he and his family are probably trying to clarify some of these messages before he could make up his mind on the timing to go back to taiwan, and those clarifications are necessary not to ensure a fair trial. Meanwhile, because he was also worried about his safety, so we have put in place some appropriate arrangements to ensure his safety and it is not proper for me to go into details. The final question about speculative report in the financial times, the ministry of foreign affairs, a spokesman has already clarified that. A very malicious and politically driven speculation or rumor. As far as i am concerned, from the beginning of this social unrest until now, the Central Government has been very supportive and remains confident that i come a myself, my political team, and the Hong Kong Government and police will be able to handle the situation and end violence and return hong kong to normal as soon as possible. The press conference, talking about several elements, everything going on, a fairly complicated situation in hong kong. Rishaad expecting a negative growth rate, a technical recession. A murder suspect, whether the individual would go to taiwan to face charges. Clear on that at the moment. There is no basis to detain that suspect according to carrie lam. David against that backdrop and slowing data, lets get it to Garfield Reynolds with our mliv block. It blog. Here is the thing. You look at how hard fields have driven up the last one to one and a half months, u. S. Stocks touched records overnight. It makes you think, is it just an adjustment in positioning or is there growth that bond markets are seeing that no one else is seeing out there . Garfield bond yields got very low very fast. In full onlly priced trade conflagration with trump made his late august announcement of the fresh tariffs, which ultimately ended up being a threat to apply tariffs on every thing china sends to the u. S. That was maximum damage priced in. Signaled thatlso the Global Economy was in a lot of trouble. Later,couple of months weve got this phase one deal being touted which, while it doesnt do not much to resolve the trade war, it does look like some tariffs might not come in and more importantly, it is the first pause on the journey to a full on trade war. That has got people saying we dont really want to see bonds when they are this little, we want to look for other opportunities and that has been driving yields up and has been driving gains in emergingmarket assets, equities, some credit corners of the globe and just recently, if you gains in some commodities, and particularly industrial metals. Out, the you point trade optimism is being credited to why the s p 500 is at a record high. When you look at asia, there still needs to be catch up that needs to be made if we are to catch up. What is it going to take . What do we need to say before see before asia catches up to the u. S. . Garfield the divergence speaks to the fact that investors are somewhat skeptical about the trade war and comments that part of the text have been basically completely agreed. It doesnt engender a lot of confidence, but we see in asia more severe impacts from the trade war. We got the hong kong situation that doesnt help, some weeks china growth that doesnt help weak china growth that doesnt help and african swine fever impact on the chinese which thed inflation, chinese Inflation Impact makes it harder for the pboc dickies as much as some might like. That is not helping to ease as much as some might like. U. S. Earnings have been wellreceived by investors. There has been enough to help the s p 500 to a record high in the absence of fresh trade war heat. If the trade war remains on the back burner or even eases off, you could see asia catch up but you need some growth on the asian front in china, hong kong, and companies and consumers businesses in general would start to feel more bullish, more animal spirit showing up. Outad south korean surveys and they took a step back. Australian business Consumer Confidence is poor. We need those animal spirits, which seem more prevalent in the u. S. Right now than in asia. Rishaad we really think there. Garfield reynolds, we will get you back to carrie lam after the weekend of violent protests in the territory. This is answering your questions from the news crews. Many hong kong people may have unhappiness and grievances about policies, the government handling of this major crisis, but the time now is really too good in all our efforts to say no to violence in order to have to put an end to the extreme violence we have seen, done ani know cnn has extensive report over the weekend, interviewing Peaceful Protesters on how they have seen the evolution of the situation. Likewise on our part, we understand and appreciate the Peaceful Protesters concern, but until and unless we tackle the violence and put an end to it, it is very difficult to continue the political dialogue we have done. I am very committed to do that dialogue, to listen to people and change policies and so on, but the first thing must be to stop the violence. If there is a large number of people legitimizing the violence or even glorifying violence, im afraid it will make it even more difficult for us to tackle the situation. Rishaad that is carrie lams News Conference just concluding. What weve got coming up on bloomberg markets, when the chips are down, stay tuned for macau gaming. David mine the data with pc groups executive. Hes coming along a couple of minutes. This is bloomberg. David welcome back and. Lets take a closer look to the blockchain story in china. Monday, a massive boost after china essentially said it wants the speed of cash to speed up development in this Technology Speed up development in this technology. China will increase investment in Blockchain Technology after chairing a study session on the development of the industry. Rishaad lets bring in dave chapman, executive director of bc group. Shares of bc group, jumping the most since may on the back of chinas latest move. Give us a sense of what is going on. David it is very exciting. The comments from president xi friday have caused a catalyst for blockchain related stocks and in the public, better known as cryptocurrency. We saw a similar jump when libra was announced, even though these digital sovereignbased currencies use a private blockchain type of technology as opposed to public blockchain which we refer to as cryptocurrencies, one act as a catalyst to the other. David which of those two is china looking to develop . 101, what does it need to do . What are the tangible steps to develop this . Dave the question. Good question. China has restricted the use of Blockchain Technology. We saw in 2013 when china vb banned bitcoin, but the pboc has been working on the state issued sovereignbased digital blockchain currency since as early as 2014, so the elimination of coins and cash in terms of the cyclical component, able be abolished. We are seeing the Technology Race of who will be the first to digitalize. Will it be libra, u. S. Based token or will be at the pbo setes pbocs own token or britain, canada . Central banks around the world are working toward this end state. It is very much an arms race and perhaps the consumer wins, but it is an interesting race that has been accelerated with statements over the past week. Rishaad all currencies are fiat currencies, but backed up my blockchain or bitcoin, that ultimately remains fiat. What is the advantage of doing this . The with the blockchain, untmpered ability amperability provides benefits to a Central Bancorp government. Some of these raise concerns for consumers. A lot of times when you look at digitalizing a sovereign currency, they big thing is better taxing it. Dont payig consumers tax because they are relying on a physicallybased mechanism. One of the controversial aspects of Something Like a digital based fiat currency . Is what does it mean for privacy . . What does it mean for control . Taxability and for the control rishaad is that because it is removing ledger . Removingouldnt say ledger it provides better control than physical cash around the world today. David it is almost counterintuitive. You know how china likes to centralize things, this decentralize is things. Marr thesehese things. Ydave the statement from china is it wont be a decentralized nature like bitcoin. Bitcoin is decentralized and that is why people like it. It is not controlled by central parties and it is the first application and realworld adoption of any blockchain we have seen but what we have seen over the last decade is people are looking at blockchains, have seen the technology, and now we are seeing Central Banks, governments, regulators try to understand how to leverage this technology that came to fruition with bitcoin. Rishaad does this decentralizing give the Central Banks more control over what they do with their currencies . I will go to capital controls because of efficiency with the result . Dave sure, that is one of the reasons china had a defense stance on bitcoin. There were concerns about capital outflow outside of china. It comes to the point i made previously. A state issued digital token will provide more control to the likes of Central Banks and governments, undoubtedly. David does it remove liquidity . Does it add to it . It is almost a proxy to the renminbi and how do you link the value of those two . And wes what the pboc saw unofficial as early as last night come in and say they are encouraging the use of Blockchain Technology, i think the end state is actually to replace the renminbi, to replace it as we know it today. If we look at what is happening with different trade wars, think a wars, i dont digital renminbi is going to become the world caution favorite currency overnight, but what is happening, especially with the development of libra, europe, and especially in china, it is a new race to the moon as this generation, what will happen in the coming months . David thank you, great stuff. Dave chapman out of bc group. We will continue to track it. We will be looking at boeing, the chief executive set to admit the company did make design flaws on some 737 max 8 s. Youre watching bloomberg. Rishaad lets look at the latest business flash headlines. Nintendo, smartphone sensation with its kart toward game, downloaded more than 120 million times in the first month according from data that would easily beat nintendos record for mobile game debuts. Game could eventually earn 1 billion a year. David spotify jumped the most jumped since its first trading day after ed morse scribers than expected in the third quarter. Servicec streaming lifted its overall base to 113 million users. Spotify has been spending heavily to maintain its lead over apple and amazon and claims to be growing more quickly than both companies. Sec Commission Planning a vote whether to ban huawei from a subsidy program. It will restrict u. S. Wireless operators from buying huawei and prevents some Telecom Giants from gear they have installed. Set to the fcc code on this november 19. Getting to the japanese lunch a rough timehaving of it, cutting its operating target 13 . Nintendo, up 1. 9 . The chemicals meter, beating estimates. David heading into the lunch break and close, we could be looking at the first golden topix index. This is bloomberg. David it is 10 29 a. M. In hong kong. Su i sugita with a first word headlines i am su keenan. Has headed over the baton to christine lagarde. Agarde will take the helm of the ecb this friday. Used to call the fabric the policymakers to order. Draghi signed off with a call for more fiscal action. Today, we are in a situation where low Interest Rates are not delivering the same degree of stimulus as in the past. Because the rate of return on investment in the economy has fallen. Monetary policy can still achieve its objective but it can do so faster and with fewer side effects, negative side affects if fiscal policies are aligned wtih with it. President e where pentair has fired eight members of his cabinet. The interior, finance and economy ministers were all dismissed. He said his government has heard the loud and clear message of protesters who want to more fair and more inclusive society. Prime minister Benjamin Netanyahu says his country is being targeted by iran. He said iran has placed missiles in yemen that can hit any target within a radius of five to 10 meters with the goal of hitting israel. Speaking before a meeting with steve mnuchin, Benjamin Netanyahu claimed that tehran wanted to set up more missile operations and iraq and indonesia. On individual travel to taiwan could see the number of visitors to the island fall. The number of mainland chinese traveling to the island jumped 46 in september. China banned individual travelers in july. Although tourists are still allowed to visit. Global news 24 hours a day on air, at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. I am su keenan. This is bloomberg. Tables the black jack were this week. Sjm Holdings Reports their macau casinosost expected to show gains despite the trade war. David absolutely. Our next guest believes the sector is under bought. The heading of gaming for the asiapacific. Why do you think it is under bought . I would say over the past been the sector has volatile. Originally we had some form of recovery. Then we declined in april and may. The deceleration july onwards. In part because of the proxy betting. It hurt the profitability, sentiment. So, overall i think from what i sense from a round of marketing the feel of the sector is too choppy. They are not really keen to buy the sector overall. Conversation ahead with them, the sector is underperforming. Rishaad why . What is the problem. Uncertainty. Vip revenue is hard to predict. We have investors rishaad so, cannot mass make up for that . Do you look at the mass players rather than the vip this is what we see no. See now. They are 65 to 75 of earnings. Are resilient from the operator report. Earnings are pretty resilient. The top line david we put this graphic up. A couple ofote weeks ago that massmarket will not be enough to complete the offset in the industry. Do you agree with that . Is 65 ofke i said the revenue after earnings. Earnings will still grow for the operator. Sentiment, for the investor to improve or for the stock to work we need vip to also get better. Rishaad what do we look out for in these sets of earnings in the next couple weeks . Reported. Already tonight. Sjm coming it should be pretty much in line with a consensus numbers but the keys that investor will look for first with a mass to grow solidly in the third quarter. Second is the outlook especially into how is october performing. Any signs of the vip recovery. Market shifts will be the key things the investor will look for. David i wanted to ask you something specific. One of your top points here is, correct me if i am wrong, were going to have a graphic up, quoting your report, is there a change in the rules and back in baccarat . Of lucky six. I dont play. Rishaad its usually the favorite. David what does this mean . Youraditional baccarat have a banker and a player that you can bet on. Right now they give you an additional option that you can bet, lucky six. These have a very high House Advantage. So, the players bet on it. Ill give you a number, the average vip House Advantage is around 3 . Lucky six is 16 . David there is a probability of the house winning a little bit more. Rishaad why would you then play . You attach a number in terms of the potential gain to the bottom line of these casinos . These additional games increase the House Advantage. Their games were approved by the gaming regular since last april. They have been gaining popularity. And then what we are seeing if you look at the industry factor going up over the last four quarters. Going up 3. 3 . Is already 10 incremental revenue to the operator. Not only beneficial to the vip but also to the massmarket. Rishaad also more into the nongaming side of things. Nongaming will take to. Ime. Still supporting the gaming elements. Especially after the opening of the mgm macau. We have more leisure and tourism coming into macau. Gaming our great attractions to these tourists coming to macau. Rishaad please come again. The Credit Suisse head of gaming research. David we are heading just outside the atmosphere. Lands therace virgin collected on their New York Stock Exchange debut. This is bloomberg. You a quick give check of your latest business flash headlines. Billionaire is setting up a 24 billion digital service. To dominate ecommerce. A 15 billion investment is earmarked for the alliance ve nture. The move sees reliance pivot from has are chemicals to Digital Services as a build a platform to challenge amazon and flip part. Flip cart. Chinese buyers may have found a way to get paid in canola oil. Canadian canola is being shipped to the uae and exported to china. Canola exports jumped 533 in september and guess what . China was the top importer of the oil from canada. [indiscernible] rishaad billionaire richard galactics virgin will become the first publicly traded Space Tourism business. After merging with a shell Investment Company that was already trading. Virgin galactic had never achieved a commercial launch. That did not bend the enthusiasm of Richard Branson on the debuted. Whatexciting ass we have been flight testing these vehicles for now 10 years. And we believe we have an architecture that is extremely has aspects also that are very suited to the customer of steering. A runway landing on the runway they will have a smooth start and ending to the Customer Experience and our rocket motor is the simplest and the safest we think rocket motor for our class of rocketry. For all these reasons we feel really good about the system. The rocket at a seconds notice which is the biggest key to their safety. The issue,ack to understand why celestial travel gets all the buzz. It is exciting and new, but surely there are good commercial applications on earth. How much should the company be focused on that . Providing travel between cities. The exciting thing is the commercial space as a massive business now. 375 billion annually growing to an expected total of 1. 5 trillion. This is the first time people can invest a pure play commercial spaceflight company. We are going to be focus first of all on building out this terrific high margin business where humans spaceflight customers operating in new mexico. What is exciting as we can build such as bigger market such as pointtopoint travel, which is a 300 billion per year we have an exciting nearterm and far to future here. Rishaad Richard Branson and Virgin Galactic subject executive george white site. White side. Ceo hashe boeing admitted they made mistakes. Of testimony days before the u. S. Lawmakers later monday. Rishaad what will the law makers want to find out from his questioning here . Will want to find in what caused the lapse some of the procedure that we are now finding out when they went through the certification for the max aircraft. Omitted some of the training process is that mightve been needed for pilots. There are going to be lots of questions towards why boeing held back on some information and why the faa didnt really take a more aggressive step in when they were certifying the aircraft. David the followon question there would be what tangible steps are actually being talked about and taken to ensure that this does not happen again . Side,l, from the boeing they are working on the upgrade of the software to ensure that t he mistakes or the sort of fa ulty readings that were caused, the two aircraft to crash doesnt happen again. That is being carried out right now. Law makers are also looking at upsibly drying up drawing regulations to strengthen some of the ways that the faa certifies some of these planes when they come in to new design and revamp and all that. Obviously, they are both taking steps so this does not happen again. David right. Thank you so much. Just to correct a couple of minutes ago we mentioned it is taking place monday. It is taking place later on tuesday. Lets have a look at attorneys. Two big lets take a look at earnings. To big earnings. You have alphabet. And you have beyond meat, one of the years most successful ipos. Su keenan has more for us. Su, lets start with alphabet. Start from a. Su profit came in weaker than expected. That has a lot to do with the spending taken place on the cloud, that is coming at the cost of their bottom line. Alphabet shares were down after rising to a new record in the regular session. Now, if you look at the year to date chart, you can see as they hit a record but it was the costs that rose, expenses rose 25 ahead of the 20 increase in revenue. Advertising sales climbed 17 youtube. The searurge in by 30 inred monday session on a report by reuters citing unidentified sources that alphabet was interested and had made a bid to acquire fitbit. Alphabets cfo refused to address what referred to as rumors. So, that at the are two to scoth the stories. Fitbit shares had fallen. Fitbit wouldve given google a shot in the arm. Wearable devices of the categories all but ignored. In any an event there is no confirmation of the story about any deal regarding fitbit. Rishaad beyond meat. Big profit boost i suppose for sales forecast. Shares on the way down. Su yeah, absolutely. There is concern that shares could fall off a cliff on tuesday. You saw them drop rather dramatically in the afterhours session, even though is you can see beyond meat sales rose 250 . It outpaced all analyst estimates. Sales forecast exceeded the expectations but the concern is that the early supporters of the ipo would in fact be allowed to sell as early as the tuesday session. Were seeing investors brace for a bit of a sell off. Notably there is a bit of a deja vu because back in july you might remember beyond meats shares of dropped again after they reported impressive earnings but announced they were going to have a secondary offering which again would dilute the value of the shares. Beyond meat came down there even though it is up several hundred percent since its initial offering, meatless or faux meat goods is the new trend in the u. S. A lot of people going vegan. That is a trend that got to competitors that has competitors as well. Rishaad we see those pictures but never mind. We are currently down to the session in india less than an hour away. We are in mumbai. Lets have a look at how things are shaping up today. Good morning to both of you in the studios. We were looking at a positive start. It has been a truncated week. It will be a catch up game. We could be off to a positive start. We did have a special one hour trading session on sunday. We had a positive on a weekley basis markets could be sluggish, but there were a lot of takeaways from the modest trading session. Most of that ended the day in the positive. Week,t, for the institutional, the net seller. Lets see if there is any money the kingdom back for indian equities this week. It is important week. It also marks the expiration of futures and options on the index. Well be watching out for that. In terms of key alreadys in terms of key earnings, they, with the numbers today. David talk about indigo and some of the other stocks in focus today. Take us through this very quickly. Motors is running 62 for the special session. Earnings were better than estimated because of better products. The airlinehas told to change its engines. Within 15 days. And the regular has warned the airline the aircraft would have to be grounded. Hpc, lets see if the stock reacts positive. Because they have raised the target price to 500 from an earlier target price of 375. Rishaad thank you. In mumbai. Up next, that time of the morning. Its taiwan versus hong kong. Battle of the charts. Thats on the way. Rishaad it is time now for battle of the charts and todays contenders include tom ellis. Againsting to going the chinese reporter an old favorite on the otc. David you can access their charts in a couple of minutes at the bottom of your screen. Headed over now to taiwan whwrere sam is waiting because no one else is headed there. That is certainly the case. It is good to talk but that doesnt seem to be the view of the Chinese Government. One of their more recent attempts to persuade the taiwanese public or press from their case for the taiwanese public that unification is in their interests, back in august chineserred all travelers from visiting taiwan unless they are part of a tour group. We are getting to the latest numbers and as you can see from the chart in front of you, tourists arrival numbers plunged more than 45 in september. That is the biggest decline since february, 2017. With china being the single biggest source of visitors to taiwan, this could be at risk taiwans numbers. Despite concerns over chinese tourism since the proindependence president and taiwan came into power in 2016, taiwan has seen record numbers of arrivals over the past two years. That could come to an end this year. If visitors numbers fall, it would be the first annual year in your decrease since the deadly outbreak of 2003. But the impact of this chinese travel embargo on the taiwanese economy could be fairly limited. T, touristfac spending makes up 2 of taiwans economy. Rishaad i was going to ask if there is anything predictably, i. E. , economically speaking. I suppose we will have to just might not either. That is the other thing. Lets get it to you now. I think my chart is a bit boring compared with sams in taiwan because my chart is about bonds. Interestthe trend is rate bonds have slide to the highest since april. That means traders are seeing much more liquidity and Financial Markets and that is helping to fuel a bad chinese selloff in the Chinese Government in recent weeks so bond havear jumped to the highest in six months. The background of all of the panic is that the chinese bank appears to be less willing to inject cash into the market. To avoid adding liquidity this week. It didnt really inject a longer term liquidity with the new targeted mediumterm, either. Now, the question becomes whether the pboc will inject cash tomorrow. If it does it shows the central stck wants to smooth boo liquidity. If it does not, the selloff in bonds can becoming worse. David two separate narratives. Rishaad very different charts. Judge. R you to david theyre preventing passengers and one centered news of the day, i would go with tian. Sam, sorry. We were together on the weekend but that is not a bearing of course in the decisionmaking. Rishaad is that jermaine germaine . David we look ahead to tomorrow what the pboc will do. I will be waiting at the airport in case there is a flood of tourists coming to. Just update you, nickel prices on the back of this export ban topping 17,000 tons. There is plenty more ahead. This is bloomberg. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Taylor i am taylor riggs in san francisco. This is bloomberg technology. Coming up, click baits. We have complete analysis of Search Engine earnings including comments from the cfo. Plus, jedi mind trick
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