Transcripts For BLOOMBERG Bloomberg Daybreak Asia 20240713

Good spirits. This hour brings earnings for samsung. A crucial report amid the virus disruption will show how the chip industry is weathering the global storm. Shery lets start you with breaking news out of south korea. We are getting become your current account balance. Right now, the surplus coming in at 6. 41 billion. Also for the goods trade surplus ining in at 6. 58 billion february. Both numbers are a significant rebound from the plunge that we saw in january when it hit the lowest level in seven years. Exports have been stabilizing after that hit from global trade spats and the double chip industries downturn. For the month of february, we are seeing an update and a rebound with a current account surplus at 6. 4 billion. The goods surplus at 6. 6 billion in february but of course we are headed to seymour economic fallout from the coronavirus outlet, so we will keep an eye on those trade figures out of south korea. For now, lets get you a quick check on markets. He restocks at the moment gaining ground after it lost ground in the previous session. Right now, up 2. 7 . This after wall street gained the most in almost two weeks. You are seeing u. S. Futures at the moment under a little bit of pressure along with nikkei futures which are down. 5 . Also a rebound for oil. Wti up 2. 4 percent, about 26 per barrel level after we saw the first loss in three days and the rise coming despite the signals that a glut is growing at the u. S. Some of the u. S. s biggest storage hubs. Not to mention concern at the meeting that producers will not yield any significant production cuts. The riskon rally you were just talking about being powered by numbers that show the coronavirus death tolls are easing in some of the worlds major hotspots, as you said. The likes of france, spain, italy. Thats turn to our Bloomberg Opinion columnist, who covers health care. You heard President Trump earlier. The markets gripping onto this narrative that we are seeing, if not a flattening of the curve, at least some sort of stabilization of numbers from these hardhit places like new york and like italy and on the european hotspots as well. Is that actually what we are seeing . More it is is better to say that about europe than it is to say it about new york or the United States as a whole at this point. There have at least been a few days out of europe where we have seen a flattening or at least a declining growth rate in a number of places but theres inviously been sort of a dip data. We will see if that trend continues. What we really want to see conclusionsg firm about anywhere is multiple consecutive days of decline of whatever metric you are looking at and the knowledge that as that happens, social distancing measures are continuing. The last thing you want is for good data to come in, people to change their behavior and then you end up with a resurgence in a week or two. Shery President Trump saying most of the critical medical needs are being more than met right now. Is that true . Know, it depends on who you talk to. Need nothe ventilator at this moment. Still time before we hit the peak in terms of demand for medical equipment. When people go on a ventilator, it is more often than not, a day or two, it can be a week or longer. As these beds get taken, they dont get they do not become immediately available for some time so there is absolutely still a chance that we will start to see more critical shortages and that is before you get towards the peak in some of these other areas of concern throughout the United States when you start having to not just worry about new york, this place of rapid growing demand with other places as well. That is when you really have to start juggling and producing and get to the high numbers to avoid serious shortages. How much progress is being made on the development of the vaccine which we know will still be many months if not over a year away . President trump spent his conference offering treatment to Boris Johnson the u. K. Wanted it and also, again, saying he was displeased about india putting in these curbs when it comes to the exports of Heico Corporation hydrochloric win. He spent hydroxychloroquine. It has been faced on small pulmonary studies. I would say what you are saying is just about accurate. It is perfectly reasonable to have hope. These hopes are not backed up by much in the way of hard data yet. You always have to split therapeutics and vaccines into different categories. You have these existing treatments that are being repurposed and you can certainly hope those are being tested right now, and i am still waiting to see any confirmatory data. These rapidly, newly developed antibody therapies, those, you might start to see data at the earliest in the fall. The vaccine after that. And everything still needs data before it can be said to be truly safe or effective in this virus yet. Still waiting on data, still se have see that the efficacy. Shery how cooperative have American Companies been during this pandemic . President trump has invoked the defense production act a couple of times already. The president does seem to kind of pixies intermittent fights with specific companies and a few days later, it is resolved with some kind of deal. I have not seen a tremendous amount of evidence that anyone haveeen so intransigent to taken this authority to get them to do something specific. They were the entire american supply chain. Anything that can be switched over to production of ventilators or ppe is going to need to these tools are necessary. I very much hope that they are used. Mass, there has been so much criticism when it comes to chinas reporting methodology. We supported reported underreporting of initial numbers of deaths. Are we also seeing that in other countries as well . It seems like an inevitability, when testing was pretty limited, that we would have had a lot of respiratory illness fatalities that probably were coronavirus in terms of the timing, but wouldnt it come under the county . . Is that something we are seeing for the data in other countries . Absolutely. It has been pretty conclusively reported in certain European Countries that because of how debts are classified and counted. Just because of sheer volume and the fact that you have these guidelines, it suggests many people stayathome unless they feel really severe symptoms. You are likely to miss some or undercount and it will be some time before we can really catch up to all of those. It is the unfortunate reality of the virus that you hear over and over when you speak to positions. Quite rapidlycost in some cases. It is because of the sheer scale , inevitable that we are undercounting in the United States and that the same thing is happening elsewhere. Haidi the latest headline on the bloomberg is the u. S. Could have millions of antibody virus tests by may. Does Research Back the reasoning that perhaps we could get some people with shortterm immunity for the virus and have them come back to the workforce and that they really would not get reinfected . On, you know, our experience with other similar viruses, there is likely to be some form of shortterm immunity , once you have antibodies for a reason. You develop them against the virus. But the extent to which they are protective, how protective they will be, how much that varies between people, severity of infection, that is something we do not know yet. That is something that really should be repeated as you hear the antibody tests hyped. We need to follow people, gather testsefore once those are available on a largescale, based on every other testing timeline we have seen in the United States. I would not take that one take it with a grain of salt. We need to know that before we use that for the basis of reopening the economy to a certain subset of people. Shery thank you so much for your insights. Max neeson in new york. Lets get to Karina Mitchell with the first word headlines. Karina boris is in intensive care in a London Hospital after his coronavirus condition worsens. He was admitted for tests on sunday after spending 10 days in south isolation in downing street. He became more seriously ill monday afternoon although he remains conscious. Meanwhile, virus cases continue to slow in italy with the Lowest Reported increase in 20 days. However, italy still has the highest number of infection related deaths in the world. Germany is planning what it calls in the madness Financial Aid for Small Businesses as part of its response to the virus. Angela merkel is warning the e. U. Faces the biggest challenge since its foundation. The European Central bank has dived into the fight against the coronavirus with bond purchases worth 32 billion this week. Most of the buying comes under its new Pandemic Emergency Purchasing Program with an existing scheme. It is skewed towards hardhit in me more than up hardhit in italy. Consumer confidence in japan has slumped to its lowest levels since the financial crisis has rising coronavirus cases prompt government to consider a state of emergency. Retail sales have collapsed as the pandemic hits incomes and keeps people at home. The abe government is planning a stimulus package. Osaka, and other regions of focus. 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. I am Karina Mitchell. This is bloomberg. Haidi. Haidi thank you. Still ahead, we will be watching out for samsungs Earnings Report coming up later in the hour. We will be bringing those numbers, the impact of the coronavirus and chip demand as soon as we get them peered out with franklincome templeton fixed income Group Executive Vice President and cio. This is bloomberg. Haidi Political Sentiment in the u. S. Has turned against Share Buybacks during the coronavirus disruption. This led to a 2 trillion stimulus plan prohibiting companies from seeking government aid from repurchasing stocks. Joining us now to discuss what this means is Franklin Templeton fixed income Group Executive Vice President and cio how much of a game changer is this in terms of how expected would you imagine these kind of restrictions and these unprecedented times in these unprecedented times . I need to preface everything i say by noting i am not an i would sayt but there are varying degrees of beliefs as to how much of a role inre buybacks have played the s ps meteoric rise in the market. I think almost regardless of whether or not Share Buyback played an Important Role in that rise in equity prices is purchasing and the extent to which the company the countrys mood, the political againsts squarely equity buyback i think there will be a protection. To the market going forward. Until that changes again. In terms of the volatility we considered new continue to see and we will continue to see across fixed income in the bond space, where are you seeing opportunities in terms of the dislocation . The main areas we have been focusing on for several weeks, actually, is to look at Higher Quality Investment Grade. Way we have meteoric drops in the equity price and equity crisis. We also have dramatic declines in debt prices. It is not the time to just jump in. In terms of looking, certainly, at Investment Grade corporates, i think there is it is a good time because there have been moments over the past several weeks where bonds, which were trading at 10 basis point spreads, the first week or second week of february. You can tell that, truly, there was a level of panic, and while in the are seeing Economic Perspective is uncharted territory, some of the places perhaps want to far. We are looking at to be very selective, looking for Higher Quality, trying to stay quite liquid in all of our portfolios. Also looking at areas like the bond space, areas where you did have some leverage sales where the unwinding of leverage led to fairly in discriminant sales in some cases of bonds. Our Portfolio Managers are safer to buy. Leverage,o not take we were actually in a very good we have seenwhat in the markets. We are now coming off a very dismal employment numbers out of the u. S. When you look ahead to some ecodata out later this month in related are u. S. Rates with Economic Data . For some time, they lost all correlation. I would say that if i look at u. S. Rates, they are actually uncorrelated now from the Economic Data. Say profit foresight in terms of how the Economic Data cannot improve while the country is actually on lock. This is not perhaps too surprising and it should not be surprising as the lockdowns have extended across the country because certainly, there are many industries, white Collar Industries all of us on the phone right now, we can all do our jobs from home, however, if you are an hourly worker at a restaurant, you are clearly a uniqueay that it is and interesting kind of unemployment that we will first, deepsee, but and staggeringly difficult cuts will come to those who are much more vulnerable in society. Much more fiscal packages put into place. Will needobably more to be done. They dont have savings. I think that is the most critical piece to look at. The Human Element of the economic shutdown. There is the big Human Element to it. When i look at rates, rates are being driven by the fed. It is a little bit independent, i would think. Rates have been driven down and it is most likely they will be range bound. I do not see them fighting anytime soon. The fed is controlling the market right now. Shery thank you very much for joining us. Franklin templeton income. The u. K. Prime minister is in intensive care. This is bloomberg. Boris johnson is in intensive care for this coronavirus after his condition worsened. However, foreign secretary says it is business as usual for the government. The governments business will continue. The Prime Minister is in safe hands with a Brilliant Team at st. Thomass hospital and the focus of the government will continue to be making sure the Prime Ministers direction, all the plans for making sure that we can defeat coronavirus and pull the country through this challenge will be taken forward. Haidi Rishaad Salamat it has the very latest. Salamat has the very latest. What do we know . The Prime Minister being taken into the hospital for intensive care. He is on oxygen but he is not on a ventilator. He is admitted to st. Thomass hospital just south of parliament. We heard about his virus symptoms not clearing up and perhaps getting worsened on monday afternoon here. Apparently, he is conscious, and he needs he does not need a ventilator, but he is in intensive care. He might need ventilation to help him recover. That is what we know this far. Donalddo know that trump coming out and saying he is a fantastic person. We have had David Cameron wishing him well and the family well. Ian duncan, former leader of the conservative party, saying likewise. This is coming at a time a critical time for the u. K. As well, naturally, as it tries to covid19 at athis time where perhaps things are not looking that good for the u. K. , dealing with this crisis. Coming less than a month since the u. K. Tried to shoot for herd immunity. There is a lot of pressure on the government right now in how it has been handling the crisis. Rishaad absolutely. Countries,ome other where the United Kingdom has not been conducting widespread testing to get reliable data on infections, they have been advising people to just stay at home, selfisolate, as it were. Medical experts including the who and johnsons own conservative colleagues have been questioning the governors records, already criticized for taking too long to impose limits on socializing. The thing is, for several top officials in the u. K. , to actually selfisolate in recent weeks, and the chief medical officer for england, and of course, jared johnsons influential advisor, dominic cummings. Johnson ordering a lockdown with schools and shops and public venues closing and people only being allowed out of their homes if they could not work from home or if they had vital needs or emergency reasons to get out. Rishaad salamat, thank you very much for that. Lets get a quick check of the latest business flash headlines. Airbus is causing production at two sites in germany and at its factory in alabama as it looks to adjust to a slowdown in demand and supply issues associated with the coronavirus peered operations will shut down for about for part of this month while production where a320s are made will close until at least the end of april. Itsng is suspending work at 787 dreamliner plant in south carolina, shutting down the last of its commercial jet factories. Duction will stop on april 8. The Company Closed its seattle area harb on march 23 and said it will remain closed indefinitely. Boeing has been hit not only by a global slowing demand for air travel but also by the grounding of its bestselling we will have plenty more ahead. Do not miss our interview with a beijing chairman and a ceo. 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. Yeah. This moving thing never gets any easier. Well, xfinity makes moving super easy. I can transfer my internet and tv service in about a minute. Wow, that is easy. Almost as easy as having those guys help you move. We are those guys. Thats you . The truck adds 10 pounds. In the arms. Okay. Transfer your Service Online in a few easy steps. Now thats simple, easy, awesome. Transfer your service in minutes, making moving with xfinity a breeze. Visit xfinity. Com moving today. Breaking news japan. Shinzo abe now saying that the fiscal spending for an economic package will be ¥39 trillion. The Prime Ministers saying the package will not be limited by what has been done in the past. Of course, we have seen the worsening economy in japan as the infections across japan rise. Right now, we are getting the latest ecodata out of japan as well as. We are seeing labor cash earnings year on year growing 1 . Now, this is a slowdown from the previous month of january. Of course, we have seen the outbreak probably reducing overtime pay significantly, even if the employment numbers have yet to take a hit and we could see a further reduction as the coronaVirus Outbreak intensifies in japan. Real cash earnings year on year, growth of. 5 . This number is beating estimates. Also, Household Spending your on your beating estimates. A contraction of only zero point 2 . The contraction was supposed to be more than 3 on it comes to Household Spending for the month of february. Whenalso coming at a time we are awaiting samsungs First Quarter preliminary results. Joining us now from seoul is global head of investments. Great to have you with us. Of course, the expectation right now for samsung use to weather the Virus Outbreak, being helped by the demand for memory chips which are surging. We have tons of activity with people stuck at home. The big question is what happens to guidance. Ofle this demand offset some the weakness and the disruptions we have seen in other parts of samsungs business . That is the First Quarter numbers that will be ok because we are not really seeing a significant drop in terms of that yet. Obviously, the secondquarter numbers will probably be the worst number that we might be seeing. For the First Quarter, the sales number, we are looking at 51 trillion won which is down, youre on year, only down 2 p are also, we are looking at operating profit of 6 trillion won, which is a 4 drop year on year. The reason for that is quite good numbers even though it is a slight decline. It is because of what you just said. The increased demand for the work from home and Online Gaming and ecommerce are all contributing to the very significant increase in demand for the server memory chips in the First Quarter. Second quarter, we will probably see that trend continue but the concern is that because of the impact of the virus, how significant drop of the smartphones also, the supply disruption due to the covid19 outbreak. The secondquarter number will be probably much more important than the First Quarter, but we think the First Quarter numbers will be coming in better than expected. At this point, are you able to quantify the impact we could see on samsung from the Virus Outbreak . We have seen india shut down because of the virus. We are estimating some quite significant dropped numbers, but we cannot really confirm that yet. We are estimating that the smartphone shipment to be down by 15 year on year for the First Quarter. Which is 15 drop. Quarter, we are expecting 29 year on year drop and another two digit drop of quarter on quarter numbers. Clearly, these are quite significant drop of the numbers. Decline inspite the the shipment, we are seeing strong dram price because of what we just talked about, how demands are picking up sharply because everybody is working at home and everybody is basically thathing into new pcs and clearly has quite significant drive for the demand. So we really need to figure out riseis the impact of the in prices versus the client in shipment. These will be wellpositioned because they have very strong market sharing in terms of all these businesses. Then, we are looking into the second half of this year if there is a significant pickup of the demand for the handsets, smartphones, because of the pentup demand. We think that for the full year, the company will look quite good in terms of the earnings number. How much weakness do we perhaps look to the consumer side in terms of the flagging consumer demand story particularly as we imagine some people have pointed out shipments of tvs, for example, will be lower. The olympics have been canceled or delayed. Declinein terms of the ated to these electric some people estimating it will drop by more than 50 . Yes, it is clearly quite significant. Samsungsy know that operating profits, two thirds of that is coming from, as you know, the other side. It is the biggest parts of their earnings. Therefore, we are concerned about the demand for the other side of the businesses, but i think the structural change in the economic scale clearly will impact somewhat positive in terms of that side. We continue to focus on koreas business as the probable winner of the covid19 impact. What is a potential upside are we maybe not looking at here . Daniel upside or downside . I am sorry. I could not hear your question. Sorry. Haidi upside. For example, there is always a chance we get a quick grants from or than expected recovery from the chinese market. Daniel clearly, the upside that we have to think about is what is going to happen post the 9 11 sorry, this covid19. If you look at what the Chinese Government is planning to do is that they are willing to spend as much as 50 of gdp in terms Industrial Revolution related industries. They will be aggressively investing into the 5g areas to clearly boost the economy, which is the same case for the u. S. We are already talking about a huge 2 trillion u. S. Dollar worth of Infrastructure Investment to boost the economy. Where that money is going to go is clearly in terms of the 5g and increasing the ecommerce and increasing the new structure of the economic picture. Clearly, that will have a very Significant Impact in terms of the earnings for samsung electronics, and if you look at sams right now in terms of the Corporate Image in korea, they are improving very rapidly because they are helping out the masked productions and they are trying to build a strong Corporate Image. Which will probably benefit samsung going to the future, so all that being said, we are looking at this, which generates positive earnings more than two digit are oldies and they are trying the book value. We think this will continue to become somewhat of a start plus a high dividend yield. Shery very interesting what you were saying, that they built up their Corporate Image. I want to ask you what is happening in samsung headquarters. There was this early surge in coronavirus cases across south korea. How much disruption did that cost to samsung . Daniel in terms of the production decline, we did not really see that actually happened over a long period of time within korea. A different story in india and other parts of the world. It was always shut down for one do impact inally terms of how the operation was working. Most of samsung is building the image of trying to be helping the covid19 pandemic issues through production of massive increase of the mass production, just like when apple is doing and obviously all these ip companies are trying to become one of the best manufacturing companies. The small and mediumsized companies. We have seen the mass production going up by more than 50 in a onemonth period. That is clearly improving the image. We are seeing a massive increase of the domestic inflow of the customer deposit for the equity market and we are seeing that a lot of that money is going to the samsung electronics. Almost the total amount of the inflow for 20 billion u. S. Dollars and half of that money is going to samsung and it is clearly making a big change in terms of the impact. Just going to jump in. We have the numbers crossing the bloomberg. First quarter samsung sales. Withillion won, on par expectations. Operating profit came in at 3. 6 above the bloomberg average analyst estimate. 6. 4 trillion won. The estimate was 6. 1 8 trillion won. Ofes on par with an estimate 55. 35. We will continue to get that break. Any surprises out of those numbers . We have been talking about looking past into the next quarter. Clearly, the numbers are coming in better than our expectation. Look intoe need to what they are saying in terms of the Second Quarter. What should i be watching for in the next weeks and months as we focus on samsung . Daniel clearly, what kind of shipment is happening, and also as well as theng consumer electronic goods aside. Also, we will be watching what is happening to prices and how demands are picking up because of the covid19. Said, one is the Corporate Structure samsung is moving away from nonpaying Dividend Companies to a highly paying dividend company. We know they are paying out close to 50 of the operating profit for dividends which is a big change. Seeatch those factors and how the earnings are playing out versus how the Corporate Image is changing where it will be a much more shareholder friendly. Yoo, thank you very much for your thoughts today. For more analysis on samsung earnings, marking men joins us later pete mark newman joins us later. This is bloomberg. This is daybreak asia. I am Karina Mitchell with the first word headlines. They has told democrats next stimulus bill in congress will be worth at least another trillion dollars. She said it will focus on replenishing funds for programs established in the last plan that was signed into law last month. Pelosi said she wants the next stimulus package passed by the end of april but the house is not scheduled to return until the 20th at the earliest. There are faint signs the coronaVirus Outbreak in new york could be stabilizing. However, the estimate from state officials is heavily qualified, saying the current level of demand for intensive care beds means hospitals in the metropolitan area will have to work at what is described as an unsustainable pace. Governor andrew cuomo says the death rate has been effectively slashed for two days. Southeast asian economies are stepping up their response to it singapore is boosting cash payouts, bringing total spending to 60 billion, 12 of gdp. Indonesias marketing dollar bonds with virus related deaths rising to the highest in asia after china. And the philippines may extend its knocked down to april 30 as the bsp says it is open to all cycle action to maintain stability. 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. I am Karina Mitchell. This is bloomberg. Shery. Shery thank you. President trump is continuing to back a drug normally used to treat malaria, calling it a possible game changer in the fight against coronavirus. So far, there is limited evidence of the drugs effectiveness. About theo bloomberg drug debate. When i saw that, i thought, here we go again. This has been more than a century for the food and drug administration, trying to make the case that just because one patient may do well or a couple patients does not mean the treatment works. The most important thing is to do a study. You can really understand whether it works, how much it works, patient population, at what point of the disease, and that is how you get Real Progress is to really understand treatment. Arounds been going on cancer treatments, other treatments for years, and now, we are seeing it again. I support what dr. Fauci said, which is you really do not know until you do a study that allows you to figure out whether getting the drug causes a patient to get better. To thedo you respond demarcation that the president of the United States made between academics and doctors . The us this divide between year he and the practice of academic medicine, of tests and the application of it in the field, where he urgently wants to take a risk on this malarial cocktail . Joshua i think it is ok when there is no other treatments for doctors to try things, but in the end, doctors want more than just treatments to try. They want treatments that work. Patients deserve evidence. Important is really to temper, you know, expectations with reality and to be doing studies and talking about the need for real data. I think it is ok for doctors to there are very few tools right now. On the other hand, that should not detract from the urgent need. We should all understand that things we are trying they may work. They may not work. We are throwing things at the problem now. Until we have evidence that tells us what actually works. Lets talk about that in a little more detail. It is guy in london. Where do you see the greatest progress being made in terms of therapies and vaccines to help us deal with this . Joshua i think, my sense, from talking to people, is that it is probably not in the medications at the president has been promoting, and you know, i mean, i hope that the studies bear out that does have some value, but i think the Real Progress right now that people are more excited about has to do with immune therapies, whether you can use, for example, the antibodies, the people who have recovered from the coronavirus has made, takes them out of their blood and give them to other people. Even before they are exposed, and there are studies like that at Johns Hopkins and other institutions in the United States, some promising data that has come out of china, but a lot more evidence is needed there, too. I am hopeful because so many people have recovered from the coronavirus that they can be donors and other people can benefit. That would be a relatively shortterm preventative therapy and treatment that could make a big difference and it could also point the way towards other products that might have a meaningful impact in the relatively short term. Sense of theyour accuracy of the models we are all spending so much time paying attention to in terms of evicting when we are going to see the peak in the number of cases . Joshua there is a little bit of a misunderstanding about this concept of a peak. I think people, you know, for where we are now, there will be a peak. The only reason it is peaking is because you have shut everything down, so i think some people think when you are on the other side of the peak, it just goes down and we can open everything back up again but if the reason it is peaking is because we have shut everything down, as soon as we open things back up, it will go up, so we have to use the time that we have, that we are buying, to get more protective equipment to Health Care Workers and to build a Stronger Public Health Response, so we have another set of tools besides just shutting every thing down. That was the vice dean of Johns Hopkins school of Public Health which was supported by michael bloomberg, the founder of bloomberg lp and bloomberg philanthropy. Coming up later on, Bloomberg Markets asia, we hear from the singapore minister for education. He joins us for an exclusive conversation on how the coronavirus and the lockdown is impacting schools. This is bloomberg. Haidi lets take a look at how gold futures are faring. Climbingjune delivery as much as 3 , actually. The highest since 2012. This as we recently saw the sevenyear high so clearly, when it comes to gold, despite the bullishness or the revised risk sentiment we are seeing across equity markets for asian equities looking to track wall street higher. There is a fair degree of skepticism or caution across other parts being expressed in the despite weakness in japanese yen. Japanese Prime Minister shinzo abe says he is ready to declare a state of emergency in seven prefectures across the country and he announced a massive stimulus package as the nation braces for a surge in coronavirus cases. Lets bring in paul jackson in tokyo for more. The state of emergency. How does it work . How targeted is it and how were these decisions made . That is a good question. The devil is in the detail. Lockdown likefull we have seen abroad in other countries. Withll not be enforceable fines, arrests, anything like that. Premise mr. Abe is trying to find a balance between shutting down the economy and fighting the virus. He wants to keep Economic Activity continuing while limiting contact between people, so it is targeted. Schools will close. Malls,ubs, shopping karaoke bars, all that kind of stuff will be shot. Supermarkets will be allowed to continue to run. Hospitals will be open, hotels, public transport, restaurants drinkingted hours, but places are basically asked to close. Shery we are also expecting another massive stimulus package coming out of japan but what was interesting was that the stimulus package mentioned by Prime Minister abe last night was much bigger than what his ruling party has proposed last week. What is in it . Increase. Dramatic we have gone from 60 trillion last week, which seems huge. Now, we are at 108 trillion, abe is 1 trillion that going to unveil later today the details of i think within that, we need to look at the fiscal measures, the spending, the stuff that goes beyond financial measures. That is also almost doubled from 20 trillion in the package you mentioned last week up to that 39 trillion sorry, yen in fiscal measures. Tax deferrals, deferrals of payments like the equivalent of health care stuff. Loans, got interestfree we have got a payment to people who run their own companies, payments going out to freelancers. Of course, we have heard about these payments to households. Cashll be quite a lot of moving around, a record package for japan that goes beyond any of the individual packages in the Global Financial crisis. Shery thank you very much for that. Before we go, here is a check of the markets. We are seeing kiwi stocks continuing to gain ground, up 2. 8 , as futures across sydney, japan, and korea gain ground as well. Plenty more to come. This is bloomberg. Shery good evening from new york im shery ahn. Im haidi stroudwatts in sydney. Asias major markets just opened for trade. Welcome to daybreak asia. Our top stories this hour, asian signss, investors seeing of hotspots cooling as the s p 500 closed at its highest levels ins march 13. Samsung beating estimates for the virus ravaged First Quarter. Chip demands held up as more people are working from home. A state of emergency in japan. A trillion dollar stimulus package. The Prime Minister, critics say, has been slow to respond to the fallout from coronavirus. Shery japan, south korea and australia coming online. We have seen japan gain for a third consecutive session with the nikkei rising 1. 7 . Rising a must as much. The japanese yen under pressure against the u. S. Dollar. We are seeing a stable japanese yen, about 109 level. We have seen better than japaned data out of including cash earnings and Household Spending. Also better than expected out of south korea, the current account balance surplus coming in at a much better than expected higher number and a rebound from the previous month. The kospi, gaining around 2 is right korean won now weakening against the u. S. Dollar, down 0. 6 . The 10 year yield, not doing much in south korea. We are watching in that country, samsung. Gaining ground more than 2 after the First Quarter operating profit Beat Estimates ing in at 6. 4 trillion one 6. 4 trillion won. Haidi that is one to watch. Lets take a look at how aussie shares are coming online. The 4 plusing on game we had yesterday, jumping the most in a week to the threeweek high, holding onto the threeweek high. Mcquarrie saying australian earnings downgrade has further to go with the widespread fundraising weighing on forward aps estimates. Aussie and kiwi stocks are 3 4 away from joining the likes of the cost, indonesia and the philippines back into bull market territory. Strength in the aussie against as well asparts strengthen the kiwi despite the new zealand Prime Minister saying this morning they will be sticking to the fourweek lockdown despite signs the coronaVirus Outbreak is abating in that country. Here isrd headlines, Karina Mitchell. U. K. Prime minister Boris Johnson is in intensive care after his coronavirus condition worsened. He was admitted sunday after spending 10 days in isolation. More seriously ill monday afternoon, although he remains conscious. The foreign secretary is deputizing for the u. K. Prime minister. There are faint signs coronavirus in new york could be stabilizing. The estimate from state officials is heavily qualified, saying the current level of deaths and demand for intensive care beds means hospitals in the metropolitan area will have to work at and on a sustainable unsustainable pace. The governor says the death rate has been effectively flat for the past two days. Iris cases slow in italy virus cases slow in italy but they still have the highest number of infected and infection related deaths. Germany is planning for limitless Financial Aid for Small Businesses. Angela merkel is warning the eu faces the biggest challenge since its foundation. Consumer confidence in japan slumped to its lowest level since the financial crisis as rising coronavirus cases trumped the government to consider a state of emergency. Retail sales collapsed as the pandemic hits incomes and keeps people at home. The government is planning a stimulus package worth just shy of 1 trillion, the largest ever with tokyo and osaka and other Major Regions the focus. Per day, on24 hours air and on quick take by bloomberg powered by more than 27 hundred journalists and analysts in more than 120 countries. This is bloomberg. Haidi we are seeing a massive jump on a stock in the australian session in the first five minutes of the staggered open in sydney. And institutional entitlement offers being made at 7. 20 australian. Center,el and flight raising approximately 562 million australian. Shery samsung beats estimates spurs chipnavirus demand. We will have analysis, next. Nestle struggling to satisfy consumer demand. Our interview with the ceo is ahead. This is bloomberg. Haidi lets take a look at how we are tracking higher when it comes to asian markets after a stellar session on wall street. All three major indices climbing why more than 7 . The dow putting on 1600 points. Lets look at the nikkei 225, seeing upside of close to 3 , opix. Ins for the t australia, 3 4 away from entering bull market territory, just about that far away in kiwi stocks as well. When it comes to the aussie dollar, resounding strength, read rebounding by 0. 5 at 6120 at the moment. Seeing strength when it comes to the kiwi, trading against the dollar as well. This as we see Risk Appetite returning to the markets. Asare watching the ftse 100 we get increasing concern in reports of the u. K. Prime minister Boris Johnson being in intensive care. He is receiving oxygen therapy. The u. K. Foreign secretary is in charge of the government. This, after the deteriorating health of the Prime Minister Boris Johnson being admitted to intensive care. His condition worsens from coronavirus. Rishaad salamat it has the latest. What do we know . he was admitted to the hospital across the bridge from parliament and he was taken there for tests. His symptoms had not cleared up. He became more seriously ill monday afternoon. Officials say he remains conscious and was moved to intensive care at about 7 00 p. M. U. K. Time, 2 00 a. M. In hong kong and singapore. Officials say he needs ventilation to help him he doesnt need ventilation to help them recover. He is receiving oxygen but is not on a ventilator. That is what we know thus far about his treatment currently. There have been a lot of people sending goodwill. Theresa may, alongside david the former leader of the conservative party and donald trump as well. There has been a lot of criticism of how the u. K. Government handled coronavirus. What are we expecting . Ad at the moment, the u. K. Is facing questions as it heads ato what is at the moment common prediction that it is going to go into the peak of the pandemic. The prime in minister fights for his life in intensive care with a government that is essentially under huge pressure to get a grip on the outbreak. Treatment comes as the country prepares for cases to climb over the next 710 days. People have died in the u. K. From the virus. The country remains in lockdown while Health Services attempt to fill shortages of masks, ventilation equipment. Until now the government had been making a point to say that even with the Prime Minister ill, he was in control. That is not the case any longer. He is out of action. The foreign minister will need to get a grip on the government machine and coordinate the pandemic response. Employedegy they have in london for defeating coronavirus has been under serious strain. They dont have enough tests. The next 710 days will be crucial. Seen e have haidi we have seen markets rally on the narrative that the if they havent seen a flattening of the curve, certainly a stabilization of new infections and fatalities. Where are we seeing relief thess europe, given that stories out of places like spain and italy have been horrific . Rishaad; we haves have been seeing a cresting, some people have called it, a sign that the crisis may be easing in some areas. Italy is reporting a lower cases. Of new that doesnt seem to be the case in new york. The governor says deaths, there were indications of them hitting a plateau but they havent reached that point yet. Is preparing for the worst. Global cases topping 3 million, and according to Johns Hopkins 74,000ity, exceeded deaths thus far. With u. S. Deaths surpassing 10,000, there are perhaps some signs of light at the end of the tall. Denmark has relaxed measures but others are being more cautious. Rishaad salamat, think you for that. President trump continuing to tok a drug normally used treat malaria, calling it a possible game changer in the fight against coronavirus. So far, there is limited evidence of the drugs effectiveness. School of Public Health vice dean spoke to bloomberg about the drug debate. Thought, saw that, i here we go again. This has been more than a , the fda,r the fda trying to make the case that just because one patient may do well or a couple patients doesnt mean the treatment actually works. Most importantly, we have to do a good study to understand whether it works, how much it works and what patient population, at what point in the disease. That is how you get Real Progress is to understand treatment. This has been going on around cancer treatment, other treatments for years and now we are seeing it again. I certainly support what dr. Fauci says, which is what you really dont know until you do a study that allows you to figure up whether giving the drug causes a patient to get better. How do you respond to the demarcation the president of the United States makes between academics and doctors . Divide betweenhe the theory and the practice of academic medicine, drug tests, and the application of it in the field where he urgently wants to take the risk on this malarial cocktail. I think it is ok when there is no other treatment for doctors to try things, but in the end, doctors want more than just treatment to try. They want treatment that works. Patients deserve evidence, not just hope. It is really important to temper expectations with reality, and to be doing studies and talking about the need for real data. I think it is ok for doctors to be trying this or that. There are very few tools right now. On the other hand, that shouldnt detract from the urgent need, and we all should understand things we are trying, they may or may not work. We are throwing things at the problem. Until we have evidence that tells us what actually works. Lets talk about that in more detail. Where do you see the greatest progress being made right now in terms of therapies and vaccines to help us deal with this . My sense from talking to people is that it is probably not in the medications that the president has been promoting. Out,e the studies bear that those have some value, but i think the Real Progress right now that people are more excited about has to do with indian therapies. Whether you can use, for example, the antibodies of people who recovered from coronavirus, take them out of their blood and give them to other people very early or even before they are exposed, and there are studies at john hopkins and other institutions in the u. S. There is promising data that has come out of china, but a lot more evidence is needed. I am hopeful because so many people recovered from coronavirus, that they can be donors and other people can benefit. That would be a relatively shortterm preventive therapy and treatment that could make a big difference and could point to other products that might have a meaningful impact in the relatively shortterm. Sense of theur accuracy of the models we are all spending so much time paying attention to in terms of predict inc. When predicting when we will see a peak in the number of cases . There is a little bit of a misunderstanding about the concept of a peak. For where we are now, there will be a peak. The on the reason it is because we shut everything down. Piques wenk once it can open everything up again but the reason it is peaking is because we shut everything down. When we open things up it will go back up. We have to use the time that we health strengthen the care system, get protective equipment a healthcare workers and build a Stronger Public Health Response so we have another set of tools besides shutting everything down. Haidi that was the vice dean of Johns Hopkins Bloomberg School of Public Health, supported by michael bloomberg, followed founder of bloomberg lp and bloomberg philanthropies. Next, more analysis when it comes to coronavirus and strategies. Beijing ceo john joins us and we will speak with singapores minister for education and the chairman for International Container services as singapore embarks on its monthlong Circuit Breaker lockdown today. You can get a roundup of all the stories on todays edition of daybreak. Subscribers can go to your terminal. It is also right there on the mobile in the bloomberg anywhere app. You can get the news on the industry and assets that matter to you. This is bloomberg. Is rising after reporting betterthanexpected profits in the First Quarter, as the covid19 pandemic boosts the chip orders from data centers helping connect millions of people stuck at home locally. Our chief northeast asia correspondent Stephen Engle joins us. Riding a surge of online activity. There are millions can at home and working from home, learning from home, playing games at home. Rival memory chip maker micron a week or so ago gave strong outlook because of datacenter demand. Data centers and Cloud Services need samsungs memory chips and the Chip Division at samsung accounts for more than half of operating profit and they have been churning out chips as fast as they can in what has been a memory chip up cycle. Firstquarter operating profit Beat Estimates by about 3. 6 at 6. 4 trillion won. The estimate was 6. 8 trillion won. In this environment, that is a good result. Not the not unexpected because the chips were on an up cycle. Going forward is the question. First Quarter Sales broadly in line, however samsung didnt provide net income or divisional performance outbreaks which will be due out later this month. One thing i might add, one thing that boosted the results in the outbreak, the won weakened against the dollar in the First Quarter and that helped samsung boost its repatriated income. Attention returns to the Second Quarter and beyond as Many Companies are looking at the data as backward looking. The uncertainty of the future, how does this bode for samsung . It is the worlds biggest maker of memory chips but also phones, displays and appliances. If consumer demand globally will be waning, that is the big concern. Internaleard from discussions at samsung, the worst case in a rio is if the pandemic persists into the second half of 2020. We have gotten guidance from hana financial, they slashed the outlook for samsung from 300 million to 260 million units. Shipments have plunged. The olympics and the euro 2020 soccer team immense have been postponed which will depress tv shipments. Trend force has to say, the current financial crisis that accompanies the pandemic produced lots of uncertainty and globalurpass the 2008 financial crisis in scale. That is the big overhang on samsung. And everybody going forward. Haidi any guidance shery any guidance on what we can expect for stock prices . 20 es have dived more than since january. The stock is getting a boost now as a result of the betterthanexpected results but now, the peak was january 20 of this year and they have come down about 20 because of that. A number of analysts have cut the price targets. Revenue growth could fall sharply according to some analysts in the june quarter, and according to eugene investment in securities, that could fall about 12. 3 . Stephen engle with a look at samsung numbers, not terrible but a great deal of uncertainty ahead going at it the next quarter. We will have more analysis of samsungs earnings with mark newman getting his thoughts on whether these numbers are sustainable and what growth looks like in the next three months. A quick check of the latest business flash headlines. Raisearch is looking to equities. The company will offer new shares at a discounted 23 . Proceeds are set to shore up the balance sheet. Aggressive costs cutting measures in sydney and anchorage as part of it cost cutting review of the company. Airbnb has raised 1 billion in debt and securities from investors. Funding comes as the business is ravaged by the coronavirus, which crippled global travel. Airbnb says the money will help it invest over the longterm. The company had been slated to list this year but the crisis put those plans on hold. Carnival jumped on news saudi arabia has taken a stake. The Kingdoms Public Investment Fund a court acquired is to break percent of the company. The fund is getting a bargain bin price for carnival. The stock is down more than 80 this year as the cruise industry tackles the threat from coronavirus. Zoom is embarking on to reassureour users he is working on security and privacy issues. Zoom has seen a 20 fold increase to around 200 million users since the start of the year as people connect from selfisolation. The app has been hijacked by internet trolls, leaving Credit Suisse to forecast its success will be shortlived. Ofry a quick check currencies trading around asia, the japanese yen right now moving around against the u. S. Dollar, or gaining against the u. S. Dollar, after weakening through the rest of this week. We are seeing Economic Data out of japan beating estimates. The offshore yuan Holding Steady at the 710 level, weaker than the seven per dollar level. The aussie gaining against the u. S. Dollar the stabilizing overnight as we saw optimism about the outbreak starting to stabilize. The korean won at the moment reversing earlier declines and after we saw samsung beat profit estimates. Plenty more to come. This is bloomberg. Now, the markets right broadly positive sentiment across asia playing out as we have u. S. Stocks surging the most in almost two weeks. The nikkei up 2. 6 , Prime Minister of a talking about fiscal spending for an economic package to be around ¥39 trillion. The japanese yen, strengthening right now despite the fact that it has been weakening throughout the week. , a huge stock. 4 samsungorean market is and they beat profit estimates for the First Quarter. Seeing upside when it comes to trading in this part the majorld following u. S. Indices tracking 7 gains or more overnight. 200ng trading on the asx just up by 2. 5 , building on the 4. 4 the 4 plus gain yesterday. We will see australian kiwi markets going into bull market territory. The aussie dollar is seeing a the rally continuing into tuesday session, suggesting we are Getting International buyers keen to buy in the next aussie Government Bond auction. We are waiting for the rba decision, not expected in terms of policy action in terms of what more can they do as they stay at the lower bound level of rates but looking for guidance as to what comes next for the economy. We are watching trading in sterling as well as the ftse futures situation. We are monitoring the Health Situation of the u. K. Prime minister, Boris Johnson, as he remains in intensive care from coronavirus. The 10th that give tentative rally raises a new question, ave we seen the bottom . Global equity strategist joins us on the line from hong kong. We were chatting earlier, we last spoke to yuan on Bloomberg Markets middle east around march 25. That feels like a lifetime ago. Im wondering if you have seen indication of a bottom, or positivity in the narrative that some of these global hotspots for coronavirus are starting to at least flatten out a little. Did that change your view when it comes to Risk Appetites and the potential that when it comes to stimulus, we may have gone too far in the right direction . Good question. In terms of the narrative, the markets have certainly embraced some of the peak reproductive numbers for the covid19, particularly those that have come out of europe, which was essentially some of the worst we have seen in this cycle. That has been one of the big positives. Number two, if we look inside the Capital Markets, companies are borrowing at their best rate in history. Certainly, the growth in loans last week was one of the best we have seen in 20 years. Even in the most difficult areas of the credit markets, companies have gone back to borrowing. The Capital Markets are certainly indicating that Risk Appetite is convincingly turned. One other thing that we would sort of say that has been a good compass about the direction for markets is that investors have been putting money into marnie market sums. We have record inflows over the next the last couple weeks into money market funds. Since the beginning of the year we have had more money go into money market funds then we have had in the whole of 2019 and more than that, as well. I think positioning also has been extremely bearish, which has helped markets. In terms of, if you are looking for opportunities, bearing in mind how much uncertainty there continues to become, are there sectors and companies that are looking strong fundamentally to weather any downturn and are unscathed implicationsby any like changes in Consumer Behavior . I think people are still going to give a lot of distance to the hotel, hospitality industries. I think what has come back in favor has been tech. Have a lot ofs tension in the balance sheet. Also, start from a position of generating high amounts of free cash flow. One of the big things we highlighted has been a Global Income shortage, which means that if you look around the world now, g20 bond yields are the lowest ever. Large parts of the equity markets arent yielding anything, particularly in areas like the Energy Markets and some of the financials. Parkedsh that has been in money market funds, when it does see a change in Risk Appetite, really only has a very few opportunities to reach the yield in the system, and we think tech will come out quite well out of that type of scenario. For theple want to wait best news, the rest of the news when it comes to covid19 and the employment data. Their mandates are very much for matching liabilities and in this sense, the scarcity of yield or income in the system is one that really focus their minds. That means tech and some of the cyclicals in the portfolios tend to do quite well. Japanese companies, quickly cutting guidance as the coronaVirus Outbreak continues. Will we see more of a rebound in companies performing, not so much in the markets now that we are getting this massive stimulus package from the japanese government . Is a market that has extremely good balance sheets, very good cash , what wed very good call run yield which is dividends plus buybacks. The difficulty is that the boj action has complicated the picture as to what the equity markets are actually discounting. Companyould have a where the dividends are going to be cut and the prophets are dropping quite sharply and share up of the last couple weeks. In japan, in terms of discount, it is priced in. It is more difficult despite the fact, it has some of the best of the other attributes. The bottom line on japan is that unfortunately, you are going to have to wait for that peak in good news in covid19, for perhaps a couple weeks, maybe a. Onth on the other hand, you do have the backstop of not only the fiscal stimulus, but the boj buying. The thing to watch is that there will be quite a few companies that will have to cut dividends given the environment. That is perhaps where the biggest disappointment may be, and we may get share prices going up a dividends being cut because of the boj action and the euphoria that swept into equity markets. Shery what about south korea . The kitchenugh in sink and samsungs numbers werent too bad. In koreas case and to some extent taiwan as well, the covid19 cases have actually been extremely good for some time, and equity markets in one way, south korea has the advantage like taiwan that they start off with decent a disk fiscal position and equity markets are quite happy that there is a lot of room for the Central Banks and governments to relax policy. In many cases, north asia, northstanding japan asia will generally come out of this sort of improved Risk Appetite much better than their peers in the developed markets. Darby, thank you very much for that. Lets go to come in a mitchell for a check of the first word headlines. Pelosi told democrats the next stimulus bill in congress will be worth at least another 1 trillion. She said it will focus on refund replenishing funds for programs established in the last bill. She wants the next stimulus package by the end of april but the house is not scheduled to return until the 20th at the earliest. Recession fears rising in india. The Services Sector contracted for the first time in five months amid a nationwide lock down and falling global demand. The pmi slipped to 49. 3 last month from 57. 5 in february. Manufacturing activity is slowing, weakening attempts to reboot the economy. The r. B. I. Cut rates last month and announced new stimulus. Oil fell the most in two weeks amid signs that a glut is growing at the biggest storage have in the u. S. And concern that a planned meeting of opec and independent producers wont slumping demand. Earlier, they plunged 11 . Industry data shows a 6 million barrel rise in cushing, oklahoma. Global news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Thank you. Coming up, will japans stimulus package be enough to offset the virus drag . We will be getting analysis on the impending state of emergency. This is bloomberg. Shery breaking out of china, getting the latest coronavirus numbers, 32 additional infections for april 6, and 30 new asymptomatic coronavirus cases. Reportingng a 32 more coronavirus cases for april 6. The outbreak has hit the global economy. Japan, announcing a stimulus package worth almost 1 trillion. Shinzo abe says he will do claris state of emergency for tokyo and six other prefectures as soon as tuesday. The claris state of emergency ar tokyo and other declare state of emergency for tokyo and six other prefectures. This make a difference for the prefectures . They dont have the legal power to keep people at home, not to mention they are urging them to stay at home. There are no penalties. , please stay at home, dont spread the virus, only go out for essential activities like Grocery Shopping or Something Like that. They have been urging people for the last couple weeks to refrain from going out. It doesnt seem that it will make a huge difference in terms of peopless daily lives, but the real concern is, the tokyo declared aociation state of emergency, saying the Health Care System is on the verge of collapse and one reason is, for the last week there has been a doubling in the number of people with covid19. O it is trending bad here i think the stimulus package will address part of the problem, but i think people are very worried about the Health Care System and whether it is sufficient to deal with the gathering crisis. The government is trying to boost testing across japan. How responsive has the handling been of the virus so far . I think at the most charitable, the observers would say the government has dropped ball on this. It has dithered and made it difficult to get a test. ,he people who have high fevers they say, come back if you have maybe weur days and will give you a test. It has been been very difficult to get a test which means the government has been shooting in the dark. It doesnt have much of a handle on the scale of the problem. So as testing spreads, i imagine the numbers are going to rise rather alarmingly. And the number of people who are going to visit Health Care Facilities will increase, so the Current Situation of being on the verge of collapse doesnt look too good over the coming months. Maybe abe will have to extend the state of emergency. This covers about 36 Million People in the greater tokyo , and another prefecture. A lot of the economy will come to a standstill because a lot of people will be losing their jobs, staying home from work, and the stimulus package, the problem is getting the money into peoples pockets. There is all this red tape bureaucracy in the way. That may be delayed. Lets talk about the economic impact. As you mentioned, some of the prefectures affected will need help. A harder lineg start of enforceability with the state of emergency declared at a later point, what do you see being the economic downfall being that japan is already grappling with the fact that the olympics and associated revenue and tourism wont be taking place this year . There are increasing calls saying it is inevitable the japanese economy will fall back into deflation. There is no doubt. Tax at the the sales end of last year, and that had already pushed growth down. Now with the implosion of tourism and the olympic cancellation, it is definitely going to be back in deflation. A lot of people thought abe waited too long. He was eager to preserve the olympics, really wanted them to go on so they downplayed the crisis for too long, and now it is blowing up in their faces. The stimulus package is massive. It is 1 trillion, 20 of japanese gdp. It is only half the u. S. Stimulus package, but it is an economy that is 25 percent as large, so it is relatively speaking a huge package and it will come in two waves. They need to get money into the pockets of people who have lost their income, so they are targeting about 3000 payments to households that have lost half of their income. There isnt really an income replacement scheme. Of a lot of people, 38 workers here are nonregular workers. They are not on fulltime employment. A lot of them are at risk of losing their jobs. It is unclear how they are going to make ends meet given that the payouts to them look rather low. Haidi the San Francisco fed put out a pandemic study on the Interest Rates and economic output and growth compared to previous pandemics. One of the things they are saying, it is not comparable because previous pandemics, no one really survived beyond the age of 50 or 60. That is not the case in japan with the aging population. Given that it took so long and so much extraordinary fiscal and monetary stimulus to get out of deflation and the deflationary mindset, how much of an issue is this in terms of the psychology, the spirit . What does that look like for japan and the population and the labor force in the years that follow out of this . Well, that is a big question. The rapid aging of the Japanese Society has been a problem that the government hasnt really grappled with very well. One clear problem is labor shortages, and the government has brought a lot of more women into the workforce and on a very limited basis, has opened the door a bit for more migrant labor but it doesnt want to have settled immigrants here. They are slowly dealing with that, but the animal spirit i say right now, people are in more of a survival mode, looking to get to the other side of this crisis because as you know, it is not just a demand side crisis, it is also a supply side crisis. The world hasnt seen anything like this. There is no playbook. They are throwing stimulus at it and trying to make it into a two year hoping later in the there will be a rebound. Fingers are crossed, but wishing risk away has been a real problem for the abe government over the first few months of this year. It seemed not to use that time to prepare for a crisis that everybody expected, looking around what is happening in the rest of the world. People here are vulnerable. The stimulus package will support, but for example, a small or mediumsized business that is in trouble, they are going to get about 18,000, 20,000. That is better than nothing but it is not a lot of money. They are going to be allowed to borrow unsecured loans at zero Interest Rates, but Interest Rates here are almost zero anyway. It is not clear whether this package is going to be enough to avert a bigort of problem. Yesterdays headline, that japan , iat the brink of the brink think that describes the situation very well. Abey we have seen shinzo survive a few scandals already. The latest poll out of japan, showing his Approval Rating is slipping almost six percentage points, to a 2018 low. Will he finally have to pay the political price over his handling of this outbreak . He may, but as you point out, he has been the teflon premier. He sunk down to a 27 approval over a variety of scandals and doctored documents, data tampering. Now, there has been the release ina letter of a man involved one of those scandals who committed suicide and his widow released his letter, which figures in the bureaucracy will are part of a coverup to try to clear abes name. That is going to be another problem for him. It may sound strange to was aers, but there are big scandal about a Cherry Blossom viewing party and who was usingd and how he this official party for political gain. When people started to look into it and ask for documents, it turned out they were shredded. Drop by drop. But abes handling of the crisis, he has a lot of company around the world. A lot of people look at, say, trump or modi or whoever around the world and say, these people have failed the test of leadership. During february, lots of people on social media were saying, abe is missing in action. Why isnt he leading the nation . He is trying to make up ground for that but the pain is going to worsen. People naturally will look for somebody to blame. He has all these scandals, so certainly, he is skating on thin ice. Thanks for joining us. Temple University Director of Asian Studies jeff kingston. This is bloomberg. Haidi we are seeing a robust session when it comes to asian markets. Before we handed over to china open, a check on how australia and markets and the rest of asia are trading. Japan, robust gains. The nikkei and that the topix as investors weigh the state of emergency as well as the massive stimulus package, 20 of gdp. Seeing gains when it comes to the kospi, samsung up 1. 3 after a reasonable technical First Quarter earning. We are seeing a rebound in some of these risk currencies. Like the aussie and the kiwi. Shery plenty more analysis of the Market Action with a managing director, who joins us at the top of the hour. Plus, a big interview later today, blackstone groups ceo joins daybreak america at 7 45 a. M. In new york am a 7 45 p. M. For hong kong. T is it for david break daybreak asia. We look ahead at the start of trade in hong kong, shanghai and shenzhen, china open is next. This is bloomberg. It is 9 00 a. M. In bay jick. Welcome to Bloomberg Markets. Im saul mckenzie. Im david. Welcome to the program. We are counting down to the open of trade on the chinese main lan and here in hong kong. Abe op story today, shinzo preparing to announce a state of emergency and near billion dollar stimulus package. Critics say the Prime Minister has been slow to respond to the coronavirus