Lighten up in a bid to get people back to work. The concern here and why these indices are in the red is what if that brings about a surge in the case count. Lets look at what is happening in the broader asian markets outside of china. You can see the asiapacific index excluding japan. Japan is on hold today. Also in the red. S p, futures looking ahead. Under pressure on worries about what suppliers will be doing to supply chains. A lot of them are in south korea and that is now the focal point for the coronavirus outside of china. I want to bring to your attention at the top of the screen, the malaysia stock index. Some political turmoil, news coming out of the Prime Ministers office. Really weighing on malaysian equities, down to the lowest point since 2015. I want to bring your attention to the currency markets. Also want to point attention to the aussie dollar versus the yen. That is not just the currency to watch in asia, but the broader risk barometer. The aussie dollar can be a proxy for dollar risk on the yen. Between the two, definitely favoring the yen, that traditional risk off move. I want to take a quick look at commodities as well. That is a huge sector to look at. When we had the original coronavirus fears we thought copper and oil would take a massive hit. Brent also down about 3 on the day. That is crucial. Remember, back when we had the trade war we saw moves of 3 to 5 in the day. So that is something to be watching for brent. On the chinesewn and broader asian demands. Haidi pretty group that in new york with a look at how markets are trading so far. Continues tous spread outside asia. Raising concerns about the prospects of a pandemic. Confirming 161t deaths. S and now seven 750 cases in south korea. Lets get to yvonne man and Tom Mackenzie. South korea among the countries reporting a surge and lots of criticism that it is too little, too late in terms of measures of containment they are taking. Yvonne especially given the spike in numbers. We are talking 20 to 30 fold in the numbers in a week in south korea. In terms of the new cases, at least half are inside of a religious group where apparently they also infected a psychiatric ward in a hospital where members were attending a funeral in the same complex. That is why the government over the weekend raised the deal the disease alert level two red alert. Be finance ministry will announcing they say extraordinary measures for the economy. The ruling party according to local media also urging for an 8 billion to budget to fight this virus. You see companies also preparing for the worst as well after samsung, one of their employees contracted the disease in one of the plants. That operation has been shut down until monday afternoon. Set to reopen later today. Italy as well has become the epicenter of the outbreak in europe. More than 140 cases thre. There. Two deaths in italy. Businesses and schools are closed. Marquee events like soccer matches, as well as the Venice Carnevale has been canceled. Fashion week has been scaled back. The eu is urging perhaps we need similar message just to limit this outbreak. Just tom, we are listening to the council giving their briefing. Saying large italian corporations are doing better than smaller ones when it comes to Economic Activity restocking. We continue to wait for the latest numbers out of chinas Hubei Province as well as the broader National Numbers as well. What are we hearing in terms of a policy response. President xi held a teleconference over the weekend where he addressed officials across the country and spelled out what he said was a need to step up. Coordinated policy and adjust policy specifically to meet those economic targets and social goals. He wanted to see output increased as well, particularly in provinces where infection rates remain relatively low. That was emphasized by president xi jinping. We also saw from the pboc, the governor wrote a column and said shaped recoveryv in china and stressing the central bank continues to have the tools at their disposal to address the economic pressure the country is facing. Thetalked at the top about fact these criteria for reopening businesses has been loosened. Of course that is consequential. We are seeing an increase in power consumption. Capacity is starting to increase, according to the data we have been looking at. But of course we are still seeing companies struggling with those supply chain ruptures we have seen across the country, and of course getting workers back into factories and offices. So that remains a challenge. Rc no doubt will outline more measures to try and address the out economic pressure. Not a big surprise that Smaller Companies are faring worse than Larger Companies. That has traditionally been the case. Thei we are Hearing Commission saying the industrial restart rate is increasing. As you mentioned, absolutely no surprise it is the Larger Companies faring better in this environment. How vulnerable are we talking about when it comes to the millions of chinese firms . Its an issue of survival for some of them. Tom it is. That legacy that you know well about in terms of small or mediumsized enterprises, having much less access to credit and loans versus stateowned enterprises. That leaves those private companies very much exposed. Oneird of smes have month of cash reserves to run before they really hit trouble. In terms of what the banks are doing, because of course they are being pressured by the pboc, they are being pressured to lend more to smes. They have given loan loan relief to just 5 of their clients. It is not a big surprise given that the banks here remain under pressure in terms of their nonperforming loans. They could potentially more than triple if the coronavirus and economic damage continues here. The banks need to make sure their Balance Sheets are looking relatively solid and they have had two eyar years. They are also being pressured to continue lending. That remains a challenge for both sides. We have seen those measures in terms of fiscal support. Things like cuts to power feeds and Social Security feeds. To we will be listening officials to see if there is anything else in the pipeline for businesses here to offshore some of that pain feeling. Haidi in the meantime, companies in hong kong are just being hit from all sides, right . Yvonne yep. Over thece secretary weekend warned of a tsunamilike cataclysm that has been devastating is this is already reeling from political protests of much of last year. Unlike singapore and the u. S. Where you have chapter 11 protection, businesses here do not have that safety net for corporate rescue procedures. In fact the lack of a Legal Framework for bankruptcy protection only exacerbates the pain. And some urging that potential. We do need more of these laws in place because there is a better chance these companies can survive this thing if we see more of these laws. They arekong is saying expecting a fresh wave of bankruptcies this year. And it seems like we are already seeing that. Late last year we already saw the bankruptcies at two year highs. Haidi Tom Mackenzie and yvonne man with the latest as we continue to wait for the numbers out of china. Lets get you the first word news with su keenan in new york. Su we start with politics. Indliners won a majority parliamentary elections. Two countries this conservatives swept to victory in tehran and other cities in what appears to be a rejection of president rouhanis engagement with outside powers. 220 will be hardliners and concern ares. And conservatives. Turnout was over 42 . Bernie sanders has taken the lead in the democratic race to unseat President Trump. Sanders won the nevada caucus over the weekend with 46 of the vote. Joe biden was a distant second, short of 20 . Pete buttigieg was third with over 15 . His campaign has been saying the results showed errors and inconsistency, and he has received more than 200 ports reports of discrepancies. China says most coal mines and refineries have resumed reduction. They had earlier shut down much as a result of the coronavirus operate. Any negative impact from the outbreak on chinas Coal Production has now been basically erased, and demand for coal power, oil, and gas overturns to normal as more companies resume operations. Global news 24 hours a day on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im su keenan. This is bloomberg. Ahead, it was a fiercely competitive cash burning market segment, but we open the books on chinas Online Education sector. Next, commodities may be down 7 today, but ubs sees gold near highs and a brent recovery to 64 a barrel. We will discuss with wayne gordon next. This is bloomberg. Commodity markets facing a brutal week because of the coronavirus disease. The disease strengthening is grippy on china, hurting growth in the u. S. , germany, and japan. Arlier we spoke about the supplyir to say chain is to winding up. Getting access to trucks and logistics is taking some time. By no stretch of the imagination are our visits is operating at full capacity but our people are safe and healthy, which is a fun it fantastic outcome. Haidi lets bring in wayne gordon, executive director for commodities and fx at ubs wealth management. Great to see. Let me start by bringing up this chart on the bloomberg looking at the commodities crunch. Unless you are a precious metal at this point it is looking pretty dire. Broaderrt tracks the commodities index. Industrial metals is there. Copper has done particularly poorly. Down about 6 year to date. Do you see any meaningful recovery for anything in the commodity complex if we continue to wade through what the economic ramifications would be of a coronavirus epidemic or pandemic . Wayne hi. I i think the Commodity Markets more generally are pricing in particularly what other asset markets are not, and that is that the impacts of the virus extend well into the second quarter. Onhink there is a real link the activity front, what we are seeing. Clearly today we are in riskoff mode, oil prices are coming off. Some of that could be related to the iranian turn. Also gold prices is shifting higher. Consequently we are in that riskoff mode today. In china, the activity signals are starting to improve. Now, that of course assumes that we do not get a second round outbreak, as some of the Migrant Workers returned to work. But as i say, it is very mixed. In some areas we have activity at around 70 since the issues broke out. In other areas because of the slowness of Migrant Workers to ratesack, those capacity are only sitting around 55 . Risk of ane, is the steeper selloff in the commodities complex, is the issue that they cannot even price in to future fundamentals because ofequity can the nature of the asset . Clearly thenk supply side is very lumpy. If you look to a commodity like has come clearly steel under significant pressure if we do not see a resumption of work on building projects and so forth. Iron ore has actually been holding out relatively well over the last week or so. As i say, it is very unique to cross the commodities. Copper which has traditionally been the canary in the coal mine for macro traders. Copper has taken a pretty big weight in this selloff. But if you look at some of the Economic Indicators in china and they begin to, as factories begin to come back to work in the middle of march, lets say, are clearly copper, etc. Priced for recovery. So we would expect to see those prices recovering over a sixmonth period. And given the fact that relative to other assets, commodities should remain very low, and particularly taking the burden of these reactions, you would expect the recoveries to be quite sharp going into the Third Quarter. For auto, its a different scenario. A lot rides on what opec says at the start of next week. And already, clearly the demandside has been very weak for oil in the first quarter. But the snapback will come, and it will come at a time when opec is likely to curtail production at some point. So there is hope, and we are quite fond on commodities as we go into june and into the Third Quarter. It is just going to take a little bit more time to work out how quickly some of these facilities come back into action. Haidi how much more upside for gold, then . We started this year with a risk case for gold at around 1700 an ounce. We are getting pretty close to that risk case. At these current levels, it would be suggesting that earnings growth, etc. In assets will come under material pressure again any second quarter. We do not think that is the case at this stage. Although there is risk that it takes longer to work its way through. We do not think that the impact extent into the Third Quarter in particular. Gold is probably reflecting those sort of risks. Not only that, but gold has been rallying again against a very strong dollar. So, consequently, as we begin to sks around the virus begin to dissipate, you are going to see that rotation back out of what has been a push into u. S. Assets, rotate back into emerging market assets, where yields are higher. That would put gold under pressure in the second half of this year. That being said though, we do not see gold as tracking back to largely we saw in 2019, because u. S. Interest rates are expected to stay lower for longer. Cpi in the u. S. Has been holding out very well, which means that real Interest Rates will remain around zero, if not in negative territory around the next six months or so. But that can hold gold up. And also as that negative relationship to the u. S. Dollar reestablishes itself in the second half of the year, we still expect the u. S. Dollar to the second half of the year against some of the major currencies, and that would also support gold prices. Along with investors continuing to see gold as a very good hedge against any uncertainty, such as the u. S. Elections which come up in the second half of the. We are bullish in the shortterm. We can see setbacks in the second half of the year, but those setbacks should be modest. Haidi thank you for joining us, as always. Coming up next, australias treasurer says his country is resilient, even as the virus operate is taking a toll on trade and travel. We will be hearing from him next. This is bloomberg. S is bloomberg. Haidi we have some breaking lines coming through from the press conference coming in beijing at the moment from the national dove and reform commission, saying the impact on the economy from the coronavirus is temporary, saying they can ameliorate the outbreaks affect. The policy stance that china is in the position to meet Economic Growth targets for set for 2020. Earlyre usually set in march and we have the meeting in parliament, but that is likely to be put on hold. Australia says the economy here is proving resilient despite the effects of the coronavirus. It is having speaking to bloomberg sunday, the treasurer said the impact on tourism and education would be closely watched. You heard the reserve bank saying it would affect the economy and the march quarter. The treasury is still working through the numbers. Obviously that will depend on some extent on how long the travel which actions are in place. We are already seeing an impact on the australian economy in terms of international tourists, International Students to major sectors across economy. Theres also some disruption to International Supply chains with a number of chinas factories remaining closed. So we will continue to monitor the situation that we do know the australian recon economy is resilient. Saying are some voices that this might be a chance to reflect on dependence on china . Australia is one of the countries at the top of that list. Is australia too dependent on china . We have embraced chinas economic success. We have been a great beneficiary of it. Hundreds of millions of people have been lifted out of poverty. Australia has been able to export to china, not just resources and agriculture, but increasingly our services as well. And we welcome the fact that china has become such an economic powerhouse. In terms of our experts, about a third of those go to china. International students are the number one source into australia, and so too with international tourists. And since the sars epidemic in 2003, the chinese economy is four times bigger. Of thenomic effect coronavirus will be more significant on the Global Economy and on the australian economy. But we have diversified in terms of our relationships with countries like indonesia. We recently have inked a freetrade agreement with them. We have supported and embraced and concluded the multilateral transpacific partnership, as well as having freetrade trade agreements with japan and korea. Haidi su i am su keenan the first word headlines. We are going to start with south korea, where the president has raised his countrys Infectious Disease alert level to its highest. South korea has reported another total of, bringing the confirmed coronavirus cases there to 763. Seven people have died so far. Moon jaein has ordered schools shot across the country after the holiday break, and essential bank is due to hold an emergency meeting later monday to consider the economic impact. To italy, the country has canceled Public Events and implemented a travel ban in the north of the country after the number of Coronavirus Infections there rose to at least 140. The jump in new cases was linked to a hospital, where a man who sought treatment last week is believed to have infected dozens. And fashionarnaval week have both been canceled. They see the Downside Risk of Global Growth persisting. Despite spending much of their time discussing the prices, the groups final statement had very few details of according to response other than to say they would risk monitoring. Chinas representatives were absent. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am su keenan. This is bloomberg. More are getting some announcement from the minister of finance speaking in beijing. We are getting the chinas finance industry spokesperson saying they are looking to more positive targeted tax cuts. Expansion of special bond issuances and increased transfers to virus hit regions. That has been speculation issuance of debt. We are hearing some of the more proposed measures, including targeting tax cuts. Activitys corporate just rising to a standstill. The impact still being assessed by the government. We have had top leadership, top brass rolling out a fleet of measures and pledging more supportive measures from the government. The impact when it comes to employment is not small. We know that that is a growth target which should have been. Round 6 it is said indirect correlation with the amount of joblessness. We will continue watching not. We are still waiting for the around 77,000 nationally infected. Lets get to our markets reporter who was in new york. Taking a look at the risk off move. Is it solely because of the coronavirus . We are seeing some different narratives. Over in malaysia, we are seeing some stocks drop since the lowest in 2015 on political turmoil. The virus front, just how different the narratives are. You are seeing south korea with a case count increasing, singapore and taiwan, we can expect japan as well to be lower on the day. On the concern that we will see a repeat of what we did with china. Kind of a shutdown of travel to the reason. Are seeingong kong those indices lower on the date of some concerns is of what if we do have some of our workers come back to work and that could potentially spur on some more spreading of the virus. Those are very different takes. Two different ways to look at it, the virus is still the broader theme. Asiapacific index down by over 1 , erasing the post holiday bump. We are seeing lots of action in the fx market. All thetime i checked, asian currencies are in the red, except for the japanese yen. It is flat on the day. Clearly, investors are pulling out of western currencies. The thai baht down to its lowest level since 2018. Those are not healthy years in the financial market. A very clear pullback from these asian currencies, from the risk on sentiment. We are seeing the impact spreading through when it comes to europe given what is happening with italy. We are getting a look at the nasdaq 100 index, 2 on the growing virus fears. What about the other side of the market . The japanese yen is fantastic. It is not just the traditional haven bid. Why are you investing in a currency in the first place . Because you have faith in that economy. Japan did come out with some Economic Data showing the largest contraction since 2014. Some hesitation of why you are seeing so the yen flat on the day. Is this your traditional bid for the yen or is this concern on the state of the japanese economy . The yen is something clear to watch against the aussie dollar. Global risk sentiment, something to keep our eye on. Taking look at what has been a session full of projection. The coronavirus outbreak has been an unexpected burden for for onestry boon industry, Online Education. It is one of the few business winners. You. To have we are seeing huge interest in the sector ask schools remain close. Online courses are culturally, these are markets ,hat focus a lot on education even to the very youngest kids. What do you see had for the sector . A lot of students try the Online Education. In the future, Online Education will further increase. . Can against be sustained some of the students will still experience the online. You can experience a better resource. Thechers online teaching model. In the near term, the online cannot replace the offline. How they can grab the students attention. Which of those names are you most positive on different models, right . Very little oneonone for students. There are those that only do oneonone tutoring. Or a combination of the two approaches. Which of these businesses in a longterm . The teaching quality, better teaching quality. It is impossible to get attention to every one of the students. We see this is more like the future of Online Education. Because the teaching quality is higher. What are the biggest threats to the sector . Term, the in the near all the school is postponed. Er the epidemic thank you so much for joining us. Taking a look at the chinese Online Education sector, which has been one of the areas benefited with the School Closures in china and hong kong. We are hearing from the peoples bank of china speaking on the Monetary Policy guidance for the coronavirus affected areas. The Deputy Governor speaking in beijing saying that the pboc will keep liquidity reasonable and the central bank will keep growing costs low and monetary and policies have a vital row a vital role during the outbreak. We have seen the pboc front and center in terms of taking measures to give a little bit of a buffer to the chinese economy. The pboc saying they will increase rediscounting. We have seen enormous amounts of liquidity operations taking particularlypboc, to some of these media meant smaller size enterprises who are hurting the most. Medium and smaller size enterprises who are hurting the most. Act. A difficult balancing they do not want to cut the mortgage Interest Rates to steeply as to risk revival in the redhot Property Market which has been a problem across many Major Chinese cities. Liquidity will be reasonable and borrowing costs will be guided lower. Coming up, President Trump may receive a heros welcome when he arrives in india later. We are live in new delhi, next. This is bloomberg. President trump is anticipating a here is heros welcome when he arrives in india later. Editor joins us from new delhi. Trumpets expecting a huge greeting. The pump and pageantry. Billboards. Trumpets expected to land around noon trump is expected to land around noon our time. While trump says modi has promised millions of people to line the streets between the airport in the new cricket stadium, that seems unlikely. Officials say it would more likely be tens of thousands of onlookers along that route. Analysts are telling us they are expecting a distraction from the domestic controversies both leaders are facing. Is it going to be a distraction for the trade deals that have gone awry . Is there a chance that progress can be made during this trip . No high hopes for trade deal on this trip. Officials have tried to hammer out a modest deal. Opening up india to u. S. Agricultural products and medical devices and exchanged for the preferential status. The chances look slim and last week, trump said the deal may be pushed until after the u. S. Election. A distraction for their respective domestic issues. Intervene ng to is trump going to intervene in the contentious issues . Domestic controversies are a potential minefield for both leaders. Trump administration has had little to say on the new citizenship law. A single official a senior official said on friday that trump plans to push modi on religious freedom. Thank you so much. Our Bloomberg Government editor in new delhi. Lets take a look at u. S. Futures, we are seeing them starting to slide as well over the news of coronavirus fears. U. S. Stocks are looking like a three data client threeday decline. Some negative u. S. Sentiment not helping things either. Hathaway, berkshire continuing to pump up the importance of its stock portfolio. This is bloomberg. Warren buffett has issued his annual letter to the shareholders. On who will take over when he retires. Su keenan has more. We did learn that there were , he reallyuisitions praised his portfolio, 248 billion stock portfolio, and talked about how it was important to justify the investments he had made. Far more than dalliances. He also spent a portion of the letter detailing how an accounting difference creates a results. Capital gains are at least equal to the individual companies. He talks about the value of the 44 , helped by, the best year for apple. Apple, bank of america, and cocacola, some very big holdings. His own Berkshire Hathaway shares did not fare quite as well, posting their worst underperformance in decade. A lot of people have looked to buffett to buy these various companies and he has been struggling away struggling. Succession, get to which is what every buffett watcher cares about, we are getting these numbers from china. 409 additional coronavirus cases. By 150. H toll rising 2592 total deaths. To 77,150. Rising 24,734 virus patients have been discharged. It is interesting. We do have the china numbers out now. Lets get back to warren buffett. We did not learn a whole heck of a lot. We did know that he mentions that we will be hearing a lot from his talk to lieutenant. Lieutenants. O he is seen as the top contender to take over for the oracle of omaha. They will be a lot more exposed at business meetings. He did not give a clue as to who would actually take over or when he would step down. Generally talks about big picture issues but he stayed away from politics, stayed away from the coronavirus. He did talk about cocker spaniels in the framework of corporate governance. He believes far too Many Companies are packing their rds with dos out creatures docile creatures. Spaniel thatker gets taken home because they do not challenge. He thinks is important to stock those boards with pit bulls. He things it is also important to stock those boards with women. Back to you. Su keenan in new york. Has voted himself out of the running for hsbc top job. He decided to stay at the italian lender. He was the top outside contender to become the chief executive. Chairman onbc sunday to tell him he was no longer interested. J. P. Morgan chase is planning to enter the u. K. Banking market in the next few months, offering a range of savings and loans products. The wall street stalwart would be jumping into a Consumer Banking market that is in a state of flux. A growing number of Chinese Companies are postponing their annual earnings outcome announcements amid the virus outbreak. 190 firms have delayed their numbers, including Companies Listed in hong kong and the u. S. Travel restrictions have made it difficult, leaving investors in the dark when it comes to guidance. At some of theok movers in todays market session. There has been a lot of transactions, mostly to the downside. Cases of the coronavirus soaring to almost 800 in korea. It has become the epicenter of the viral threat here in asia. The aussie dollar continuing its demise. Exposure to china, exposure to the waning commodities complex. Than ading weaker here are the winners. The dollaryen still there, cold trading above 1600. Above 1600. Ing lots more to come. This is bloomberg. It is almost 11 00 in the lion city. We are entering the last hour of the morning session in hong kong. Here are the top stories. Ariserips markets after in the number of Coronavirus Infections outside of china. Surge andouth korea italy becomes europes epicenter. Political crisis bruce in ews in malaysia as the Prime Minister is unwilling to hand over power. This is Bloomberg Markets asia. Haslinda lets start with a look at the markets. We are seeing right across the board. Virus concerns driving the selloff across the board. We even saw comments out of Chinas Ministry of finance that they were trying to Lower Borrowing costs, not making a dent in the selloff. The shanghai composite still under pressure. Index, also under pressure. On the virus concerns. The one idiosyncratic story is the malaysian stock exchange. Turmoil,me political news out of the Prime Ministers office. Primarily driven by the virus concerns across asia. Some fears that if we do start to see workers start to go back to work, that could expand the outbreak further. All of those worries translating over to the u. S. Session. S p futures are down 1. 6 . The dollaryen, an interesting story. The only asian currency that is in the green. Gold seeing massive gain alongside the dollar. Copper and oil both down on the day off of concerns about what the virus will do. I will take it from here. Story, chinese policymakers are pledging various measures to support the economy. The total number of cases rose to more than 77,000. Lets bring in Tom Mackenzie and yvonne man. Can you run us through chinas latest numbers and what sort of promises officials are making . Tom the topline numbers of total infections in china is 77,150. 2592. Ath count is in terms of the cases, an extra 409 infection cases reported from china today. From theose are epicenter of this virus. Trend of a moderating infection rate seems to be continuing if you take these numbers at face value. In terms of the numbers discharged, 25,000 people. That is in total up until the 23rd of february. We did hear from one of the medical experts saying, look, we may be seeing a moderation that may continue for the rest of this month but it does not mean it has completely peaked. As people return to work, there is a risk of further infection. The count is lower than it was yesterday and that will be optimistic for some. We have had this press conference from the pboc. The ministry of finance saying they will expand a special bond issuance to help fuel the infrastructure growth we are seeing at the provincial level, targeted tax cuts. Dusting off the playbook we have seen before. They will increase transfers as well to crisis hit areas. The pboc will guide borrowing costs lower. Y will keep liquidity Monetary Policy will play a vital role. They think they will meet these economic targets for 2020. Haslinda south korea preparing for economic the prospect of a pandemic. South korea reporting a surge. Cases outsides on of china. The total number of confirmed cases to 763 in south korea. Seven deaths in the country. The government raised their disease alert to the highest over the weekend. It seems that more than half or around half of the new cases have been tied to that religious group. We heard from the finance ministry, they will announce extraordinary measures for the economy. The ruling party urging for an extra budget amounting to 8. 2 billion. Preparing for the worst after samsung had to shut down one of its factories after an employee contracted the disease. They plan to restart operations later on this afternoon but a troubling sign for Many Companies like lg electronics. Italy, the epicenter of this outbreak in europe after more than 140 cases. Lockdown righta now after the country announced it second death. You have schools closed, soccer matches have been canceled, milan fashions week has been scaled down. They might need similar measures to what we are seeing in towns and italy to other communities. Haslinda china keeps saying it will meet the 2020 numbers but much of the economy remains how vulnerable are Chinese Companies . Tom Chinese Companies, particularly in the private sector, over noble are vulnerable. Third have about as much cash as they need for about a month before they start hitting real problems in terms of paying wages and paying down debt. The central bank has been pressuring lenders to ensure loans are going to the private sector. If you look at just one lender, icbc, they have only given loan relief to about 5 of their sme clients. The banks are seeing nonperforming loans take up. That is a counting act that is proving difficult for both sides. A balancing act that is proving difficult for both sides. 200 20 million Migrant Workers have still not left their home provinces to travel back to work. Getting employees into offices has proven a challenge. We have seen moves to cut rates, energy rates as more, Social Security. To try to alleviate some of the pressure. Needing the options they to get the supply chains working remains very challenging. Kong the virus in hong also comes on top of months of political unrest. What sort of risks or companies in hong kong facing . The tsunami like cataclysm on businesses. U. S. , singapore and the where there is chapter 11 protection, all businesses here in hong kong do not have the safety net for corporate rescue procedures. This lack of a Legal Framework for corporate bankruptcies that is exacerbating the pain, the fact that we do not have the bankruptcy protections. Maybe this will force a lot of companies to liquidate because of this, because the laws are not in place. They are expecting a wave of bankruptcies. Especially in the retail side. We already saw bankruptcy hit and almost to your high. Twoyear high. Haslinda thank you so much for the update. Lets get first word headlines from su keenan. Iran with start in the latest on the political front. Majority in the parliamentary election. Conservatives swept a victory in toronto and other cities in tehran and other cities. 220 will be hardliners and conservatives. Turnout was just over 42 . Bernie sanders has taken the lead in the democratic race. Caucus withevada 46 of the vote. Joe biden, who had been the front runner going into the series of primaries, came in second and was just short of 20 . Put Buttigieg Pete buttigiegs third. It received more than 200 reports of discrepancies. China says most coal miners and refineries had resumed production. Officials say any negative impact from the outbreak has been basically erased and demand for coal power, oil and gas is starting to return to normal as more companies resume operations. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Haslinda thank you so much. President trump heads to india anticipating a heros welcome but trade frictions persist. As the coronavirus continues, we speak to a guest who sees reason to be bullish on at least one sector. This is bloomberg. Paul asian markets trading lower almost across the board as the number of coronavirus cases outside of china surges. Today. Ou for joining us we had a warning from ubs chairman that he feels markets are underestimating the risk from the coronavirus. What are your feelings . ,there is outside china [inaudible] we are having a little bit of difficulty hearing you. Maybe we will try to reconnect and get back to you. Come, this is bloomberg. Paul lets get a check of the latest business headlines. Pepsi is starting is planning retaileronline snacks for 705 million. Pepsico is hoping to expand in china. It is one of chinas largest snack food companies. Crown resorts faces the first set of public hearings whether the operator is fit to gaming1. 1 billion sydney developer. Paul in new zealand, a warning on the 2020 earning saying the impact of the coronavirus will see a hit. The airline says the travel to and from asian destinations is being severely affected as long along with domestic demand. Asian markets are trading lower across the board as we have the numbers of coronavirus cases outside of china continuing to rise. Lets get back to our guest. Joining us now on the phone from hong kong. I was asking you before about the comments from the ubs chairman on the sidelines of the g20 saying that markets are underestimating the risk from the coronavirus. Pretty powerful selloff in some markets today. You think he has a point . I think he has a good point. Remember that most production and on the demand side in this case, it is affecting the whole world. We might see some recovery in the second half of the year. Some are underestimating the first quarter. Has there been a lot of talk about a v shape recovery . Do you think we have not reached the bottom of that v v yet and how much deeper are we going to go . The first quarter, that will be quite deep. On the second half, we will see some recovery, but very slow. Most of the production will return to normal. We are thinking about the numbers coming out for the first quarter. It depends on the stimulus actions from china. Thatnda not surprising the dollar is sgthengs investors hunkered down, embracing for the worst. Inching ever closer to the 100 mark. Worsehink there are things from this virus that can come. I think investors are thinking about this issue. Investors are thinking about once the virus has stopped and the market recovers, there will be a strong gain from that. Haslinda we have a headline from the pboc saying it is reviewing whether or not to cut benchmarks deposit rate. How do you think the pboc will act . Discussions the key issue china is suffering from demand shock. Those things will hurt the growth of china. One of the ways to think about liquidity. More they will go out and spend money after the virus is contained. Changesve you made any to your Investment Strategy during the crisis . I am interested to know if you are short anything. I think most people have to stay at home. The internet stocks will perform quite well. Other, on the short side, lots of people are thinking about the banks. They will suffer a lot. I think we will have to Pay Attention at this point. Haslinda mentioned the strength of the u. S. Dollar. We are seeing the strength in gold price as well. Handsomelyice is outstripping forecast. Time, the same we have to think about gold prices are already rising a lot. The return to liquidity to the equity markets will be quite strong. Tolinda gold could get 1850. You say that gold will peak at what price . 2 to 5 percent to go up. Now we are facing some of the , antries other than china lot of cases of the virus, right . Investors would rather put the money into the gold. Once they contain it haslinda good stuff. Much for, thank you so your insights. Taking a look at where we are in terms of the markets. Losses across the board. Index, down by 16th of 1 . Hong kong is also lower. The markets are under renewed pressure as the coronavirus outbreak becomes increasingly global. Hiking in korea. Shanghai composite is down by 4 10 of 1 . Still to come, President Trump heads to india and expects a heros welcome. Trade tensions are boiling beneath the surface. We will talk to eight former u. S. Diplomat to south asia to a former u. S. Diplomat to south asia. This is bloomberg. Sometimes your small screen is your big screen. And with the Xfinity Stream app, which is free with your service, you can take a spin through on demand shows, or stream live tv. Download your dvrd shows and movies on the fly. Even record from right where you are. Whether youre travelling around the country or around the house, keep what you watch with you. Download the Xfinity Stream app and watch all the shows you love. Live pictures this monday. We had in the middle of the trading day. 8 . Ntly down 3 . Ng down about can in newo see york. Su the latest on the coronavirus. Today is ground zero. Hubei is ground zero. 149 new fatalities. That brings the total number of confirmed cases we have been hearing from the pboc governor. Infectious disease alert levels to the highest. More korea has announced cases. Seven people have died so far. The central bank is due to hold an emergency meeting later today to consider the economic impact. Implementing a travel ban in the north of the country after the number of Coronavirus Infection rose to at least 140 there. Amen is believed to have infected dozens of patients and medical staff. G20 finance chiefs absent the bankers say they see the downside persisting amid the coronavirus outbreak. Despite spending much of their time discussing the crisis, the final statement provided few details other than to say it would enhance. Focusing on countering the fallout at home. This is bloomberg. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im su keenan. This is bloomberg. Paul how should we be thinking about this . Is this just a case of the south korea coronavirus case rising . Is it more than that . It is still the main driver. The difference is how each market is reacting. Actually down the most by the most since october 2018. Right before we saw that Fourth Quarter crash. Really crucial to see where we are. Equity markets lower on the day as well. There are fears. Back too get workers minimize the traffic. Expanding. En mean lowest since august 2015 off of political turmoil. What are you seeing in the markets . You guys did a great interview. Gold is higher on the day. Remember when we were concerned if it would hit 1600 . We are well past that level. Retelling you that gold is the haven of all havens. There . W much yield is gold is kind of the big hitter. Gold rally soc much. 3 . Those are about the same springs that we saw during the trade war. It is a key metric to watch. President trump is hoping for a heros welcome when he arrives on monday. Growing trade friction. Lets bring in our correspondent. Good to have you with us. Optics . More about certainly in the runup to in the days rate before, we started to hear some breathing from government officials to sit know that they expect deeper policy statement. They have been talking about understanding focused on. Ecurity we will have to see. Certainly, the president himself seems very focus on this gathering of a large crowd. Do you think a closer relationship with the in and india is ahead . Think there has been a conversion of interest. That has been a process taking place. It was made possible with the coming together of countries. It did not have the best relationship. Both countries come both the u. S. And india what to see and asia that is not dominated by any one power. That has been a pillar underlying. Paul how is this challenge persuading india . It is a very different challenge. Buta opened its economy, there are companies that are market dominant. Espionage. Those are in issue that we have. Began opening its economy a more slowly becoming open place with significant barriers. All you have to do is pick up the National Trade estimate that they put out. Taking a look at. Concerns. At. Aking a look a myriad of concerns. There are concerns that india is moving in a protectionist direction. It will make it harder to advance a greater economic opening. Paul perhaps some Common Ground. A failure to announce anything will be a potential embarrassment for both of them. Can you identify any low hanging fruit . Channel,de negotiating it appears google not be able to announce success of any kind. It is disappointing because people have been working on this for months and months. Move to theely to acquisition that we will be making. From the u. S. , it would be a naval helicopter. There is one more that might be in the works. A final signature would involve the acquisition of apache helicopters. This would be a way to point to commercially easement between the countries but does not ofresent a culmination positive outcome from trade negotiators sitting across the table from each other. A sense of how important india has become to the u. S. We know that last year, that amounted to Something Like 15 billion. India is playing an Important Role in this. Indias major Defense Supplier was russia. In the last two decades, they have begun to diversify and create their own array of different providers. Challenges,ts own but it does mean that the u. S. Defense relationship the is thathat people quote the course of the last decade or to it has gone from zero eight billion dollars. 18 billion it is a very positive thing to be able to showcase. Is it true that india is important for american it provides a scale that American Companies need . Where are we on that . Sorry. I could not hear. India is important for american tech companies. Where are we on that . You need high skilled workers . That is right. In two ways. Many had a strong presence in india now. Think of every Major Tech Company that you can think of. Now, the u. S. Also had permissions for skilled workers. Indians are well represented in. Hat category over the course of the last 15 years, indian citizens have gone god from present gone from 40 . Paul talking about Common Ground that exists between the u. S. And india in terms of defense, but there are problems there as well. Attempting to secure peace with the taliban. What are the indian concerns there . Likely tosident is hear about the concerns when he has his private meeting with Prime Minister. A larger delegation meeting on tuesday as well. Concerned, if there is a resurgence of the taliban. A return of terrorism to the subcontinent. Return to a much stronger looking across to india. 19 99, the of hijacking of the Indian Airline down to delhi. These were days of terrible terrorist acts. They will want to speak very bluntly and plainly with the delegation and share their view. From thornton from foreign relations, thank you for joining us. We are counting down. Just a few minutes away. We will have the Market Reaction from mumbai, next. This is bloomberg. Paul indias markets have just opened. Take us through what to expect for todays session. Morning to you. As you can see, moving averages closer to 400 points. Nearly 1. 5ing with percent. We have seen underperformance in the last month or so. They are down in the opening session. Closer to 200 points. Surged quites sharply. Week, it looks like volatility could go higher. What are you watching . A lot of farmers stocks. With thisin unprecedented move that we have seen for the first time. It was given to unit four of the company. This action implies the action that took place is still open. The plan will be classified at a later day. Surgedek, the stock nearly 20 on wednesday. Son pharma is another one. Alleged not confirm misappropriation of funds by the promoters, which was close to 6 billion. Laboratories more action initiated, but no positive reaction coming into the market. With that, it is back to you. Thank you for that. Lets get to malaysia. Malaysian politics is set for another shakeup. Two years after a stunning reportedlyn, maneuvering to form a new government that would exclude by our guest. Flow, to flow to friend, to friend to flow again. Questions. E been right now, we are seeing some action from supporters. Yesterdaya meeting with various parties. Members of his party joined that meeting. He is supposed to meet the king later this afternoon. We are all waiting to see how this will shake out. We are almost certain that there will be some sort of reject of the current coalition. Promise asy him this Prime Minister. Paul a strong sense of history repeating. What happens next . What is the background for this latest disagreement . There has been tension all along. Decades. Ry goes back picked out of the cabinet in the late 1990s. Just after the election. Questions. Been he has been cross. The tensions have always been there. Can he effectively win an election on his own . We can expect members of his party to seek an election right away to decide who will be in charge of malaysia. The issue at heart. That is correct. Election tounwieldy begin with. Mostly ethnic chinese. One that could be in jeopardy today. Guy who was the rival, to take over as leader. That played out last year, quite a bit. One of the guys who was in this with government that had been reported. It is going to come down to the numbers. How many members of his party . Debatinga lot of behind taking place and we find out later today. Bloomberg is a government managing editor, thank you so much for that. Come, markets are underpricing the risk the coronavirus poses to the economy. This is bloomberg. Is predictingrman a massive hit to the Global Economy from the coronavirus outbreak, saying growth could fall to. 5 . They are underpricing the risk. Market has the view that the glass is halffull. Temporary one quarter impact on gdp and trade and we will move on from there and rebound. That is phased into our projections. The length it is a coordinated response to a slowdown in the world. What is the coordinated response . What is 2020 . To get the numbers right, in our estimate, this will bring Global Growth from 3. 5 to. 5 , which is a massive drop. Chinese economy down. China will pose a negative number for the first quarter, which requires a response. The global number tells you that it is not just china. It is impacting hong kong, and the support that the rest of the world could give is to keep the door open for export and trade with these countries. Markets,en i look at equity markets are only slightly shaking. Equity markets underpricing the numbers that you pointed out . Tensethe moment it is a jerry. Jury. Haslinda something to tell you about. A headline out of china says willon will allow wuhan allow nonlocal rest 77,000. Ssing are ina look at where we the markets across the asiapacific. Down. A look at kospi the s p is lower by 2. 3 . Outbreak rus bloomberg from markets asia. Paul daybreak middle east is coming up, next. This is bloomberg. Manus our top stories, the coronavirus spreads, raising concerns about a pandemic. Questions have been asked about the continents reliance on china. [indiscernible] saudi arabia