Barrier. Softbank is said to be planning deep cuts at the vision fund which could affect 10 global staff, souring bets on tech are takingke their toll. Haidi a mixed start to a politically driven status when it comes to the markets today as we get that precedent being set with that security bill as well as greater considerations over what kind of reopening and second wave issues we are seeing across the rest of the regions. We are seeing new zealand markets starting off the day with tepid gains. The session looks a little bit more muted for the rest of asia. We are seeing japanese futures as well as Australian Futures pointed a little bit higher. Those in hong kong seeing retreats. The npc is being i to be passing the Hong Kong Security eyed to be passing that Hong Kong Security bill. The u. S. Sees 100,000 deaths. We are watching the oil story, seeing whether this pause in the rally will continue given concerns about renewed production out of the likes of russia. Shery to our top story, hong kongs future as an independent trading leader in asia is in doubt after washington said it can no longer certify working distance from china. The decision could trigger farreaching have consequences on the Hong Kong Special trading status. China has vowed to retaliate, saying its affairs with the city are strictly internal. Tom mackenzie is watching this in beijing. We have more reaction coming from policymakers in china, especially when it comes to insisting that this would only affect a very narrow category of acts when it comes to the National Security law. Again, another attempt. This is of course from the Chinese Embassy in washington to try and clarify and reassure people in hong kong and internationally that this security offer hong kong would be narrowly defined, only focused on certain acts. Concern among those in hong kong, the pair democrats, and the nt beijing forces, but also internationally, is that this is a broad security law that could be used to undermine the autonomy but also to curtail free speech, free press, ngos, and a number of other issues. In terms of what we are hearing from the secretary of state, mike pompeo, he made the determination that hong kong does not, as he says, enjoy a high degree of autonomy from china. He was compelled to review the status that hong kong has because of this bill that was passed at the end of last year. Now, the question is what actions is the secretary of state and the Trump Administration likely to take . They could look at restricting visas or asset freezes. Of course, they have been provoked or their decision has been accelerated because of this decision by the National Peoples congress. Beijing to circumnavigate the government in hong kong with this security law. Beijing says the security law is one that many other nations have. This is an act in terms of what the u. S. Is doing, the response from the u. S. Is meddling in hong kong and chinas internal affairs. That is the chinese stance. They will respond with strong countermeasures. We have this unreliable entities listed they have been using that could target companies. We are watching for the chinese response, but first, we have got to see what the u. S. Is going to do in terms of visa restrictions, asset restrictions with chinese officials. It is not expected that this changes the trading status with hong kong. That is still an option for mike pompeo and the Trump Administration further down the line. All of this happening on the same day as the house passed that weaker bill which authorizes u. S. Sanctions to be placed on chinese officials for human rights abuses against muslim annuities in china minorities in china. This is likely to inflame the anger in beijing further. Am it will do and it is reminder that congress and the Trump Administration are taking actions on a number of fronts to pressure china and this is a reminder that human rights as part of the mix even if that is something we would not have considered when Trump Took Office in 2016. The human rights bill focused on what that means. According to the United States state department and United Nations and other ngos and human rights bodies, there are as many as one million muslims interned in camps. China says they are education camps, schools, essentially, is how china has described them. Most outside observers described them as detention camps and this would restrict visas for officials that are involved in that internment of those muslim people in chin zhang and possibly also asset freezes as well. They would also condemn the camps and push for them to be close to down. President trump has not said whether he will sign off on this though but it is a reminder that these pressure points between beijing and washington are on a number of fronts. Shery the National Security bill that would affect hong kong now expected to pass today at the npc. That is right. This is really the top ticket agenda as the National Peoples congress concludes today. You have delegates facing other measures in the great hall of the people this morning, but really, the focus is on that decision. They will vote and pass this bill to enshrine a mechanism, an entity, that would enforce the security law. It would not enshrine it in the law at this stage, but it is another major step in that direction, and of course, we have another set of measures by democrats and republicans in the u. S. Looking at pushing through a bill and legislation that would punish and take aim at any of those entities and potentially also chinese banks doing business with those entities so that is another reminder that the legislative process continues in washington to try and curtail chinas behavior in these issues. China says the security law is narrowly for focused. It is vaguely defined. We will wait to see if we get any more details. Premier li keqiang will be giving a briefing at 4 00 p. M. Local time to go through what has been discussed over the last week in beijing. Maybe you will comment on these increasing and rising tensions with the United States and this issue of the Hong Kong Security law. Haidi Tom Mackenzie. Markets coanchor in beijing. More on the tensions over hong kong later with the former ledge copresident. Other guests will be joining us. Shery first word headlines. Global coronavirus cases are with u. S. 5 Million Deaths passing the psychologically important 100,000 mark. New york remains the worst hit state with Governor Andrew Cuomo calling for federal funds to alleviate the economic fallout. Will de blasio see is a 9 billion black hole in the budget , worse than the estimated shortfall released last month. The European Central bank says the singles market is deteriorating and heading for recession as bad as his most pessimistic forecast. Christine lagarde and her colleagues say output is set to shrink by as much as 12 , calling a less weak decline out of date as the coronavirus theked down is jobs and coronavirus slashes jobs. Japan is doubling its stimulus measures, vowing to keep the economy alive the worlds biggest virus stimulus package. More than 1 trillion to help households, healthcare care, regional economies. Plan will be funded by an additional budget that breaks the record for Government Spending that was sacked only last month. Reports from washington say the Trump Administration is to end waivers on doing business with iran over nuclear operations. The post said the decision would reactor the heavy water at the plant and to the transfer of spent fuel sent abroad. However, washington may extend waivers on support for the Nuclear Plans to boost an agreement that perceives the 2015 deal with major powers. Softbank is said to be planning deep job cuts at its vision fund. We will get the full details later on. Will saychael mccarthy how to navigate political tensions in the markets. This is bloomberg. Haidi asian stocks look set for a mixed session as investors weigh more gains on wall street against rising tensions over hong kong. Chief Market Strategist joins us now. Is it fair to assess at this point that despite the escalating tensions between washington and beijing, despite these concerns of market volatility that could affect hong kong will spill over to asia . It is more like a regional concern than a Global Market sentiment . I suspect that this one is a global issue because it is not just over the status of hong kong. We have got ongoing disputes over trade issues, the phase one trade deal only just being implemented. There are concerns about an inquiry into the coronavirus and a number of fronts on which the u. S. And china are doing that are so hong kong could become a proxy for a broader disagreement. If that is the case, it will quickly escalate from a regional issue to a global one. In the words of china, this is the u. S. Trying to potentially create a new cold war. How do you trade in that kind of environment or how do you hedge against it . We have seen heightened rhetoric out of beijing for some time now. It appears to be their new way of doing business globally. They are vehemently stating purely an internal china matter and it ignores the special status china has in financial markets. Hongkong is on par with kong, new york, the Financial Center at the moment. If they reduce independence or autonomy, it is hard to see how that special status as a Financial Center could remain. That might not be a consent to the chinese government. It is clear that they are looking to develop shanghai as a regional Financial Hub. In the shortterm, that disruption to the Global Financial market system is likely to have an impact that will be felt everywhere. Shery really interesting to see the mainland money flowing into the hang seng index. This index really has included owned companies from china and when you compare it to the msci hong kong, which does not include the Chinese Companies, has been under pressure. Is this a trend we will continue to see . Michael i suspect when there are issues around status of hong kong, it is likely to continue perceived mainland support. I think that will be part of the measures. Its interesting to see the divergence in markets overnight. The s p 200ures for in australia in the green. Hang seng futures are down. 3 . Within the region and china, they would like to see it performing with Global Markets. That might be a test of determination to support the hang seng, and by extension, the issues coming down. Shery we have also seen the pressure on the chinese yuan as well that has really, in overnight trading, fall into an alltime low. Where are we going with the renminbi . Theres a lot of speculation that beijing might let it weaken further. Michael they are watching it very closely because that will be interpreted as a sign that tensions are continuing to escalate. 720 markthrough the would be significant and it could signal about the political intent behind the currency moves as interpreted by those in the u. S. , so it will be very important for the regional performance as well as the hang sengs performance. Is that we are emerging markets, particularly em currencies, are going to take their leave from given the anchor role the yuan continues to play . Michael i think that will be a key factor because at the moment, we are getting diversions across the asset passes. A much different performance in other markets. Dons rallied. Gold held 700 to 800 u. S. Aluminum managed to which saw big pressure on copper, nickel, tin, coming up 1 to 3 . Those growth fears were not reflected in market trading so it is hard to say what the region will respond to. Today, it is quite possible we will see diversions between the different markets across the asiapacific region. I thought it was interesting, in particular come out of the overnight session, you are starting to see the start of rotation from growth to mega caps,ize from recovery in small caps, and potentially, we are seeing tech certainly still dominant but you are seeing some of the other sectors play catch up as well. Are these trends that you expect would continue as we continue to get to the other side of this pandemic . Michael emerging stock markets look at central performance over the last 48 hours and it indicates growing optimism about the lifting of lockdowns because you are absolutely right. Financial stocks have led the last night, 7 gains which pushed the dow higher. They gains in the u. S. Are narrow and as we spread out and look at the broader indicators, the upward momentum gets less and less. These are very narrow gains. I expect that while optimism around lockdown measures continue for financials, for industrials, for Consumer Discretionary stocks, despite the equity background, it pains me to note that equity markets are often the cousins of the Asset Classes and the last to react on that pressure we are seeing for both exposures and that preference for safe havens and other Asset Classes. We might be about to see the end of that rotation in equities. Shery just before we let you go, we have seen extraordinary gains not only here in the u. S. With the s p 500 rally, but also in the asx 200, which has gained around 5 or so in the past month. What does that do to valuation levels . Michael this is a fascinating thing. If we start to look at the graph of earnings related ratios, the s p 500 is back at alltime highs in terms of expectations, so valuations are looking very anand that is on you unusual situation to be in for u. S. Exposures. Shery we are now seeing stock valuations in australia also soaring to record novels. Thank you veryy, much. Coming up next, the job cuts are coming to softbanks vision fund. We will have more details, next. This is bloomberg. Shery sources say softbank is planning deep cuts at the vision fund which could affect about 10 of total staff. Asia tech executive editor Peter Elstrom has the story and joins us from tokyo. Not that surprising given all of the problems that the vision fund has faced. I do wonder, where are the cuts happening . We know japan has pretty strict labor laws. Peter thats a good point. You are right. It is not a huge surprise. We saw the vision fund announced losses of about 18 billion on the Portfolio Investments so we know things are going in the wrong direction. They do not need the kind of staffing they have had in the past so sources are telling us they are planning these cuts. The vision fund is based in london so our understanding is that the focus of the cuts is going to be in london and they have offices in other parts of the world including california and tokyo, so they are trimming back across the board. They have not made any of these details public at this point so we are doing this based on sources but our understanding is that it should it is likely to touch those offices. We are seeing softbank unwinding its holdings and a lot of investments. Are we seeing that continue, this kind of fire sale, as it tries to regain control of the situation . That athe backstory is softbank, after a steep incline in the share price, Masayoshi Son announced a buyback of his stock, which he has been proceeding with, and that they were going to sell more than 40 billion in assets, so we have seen them take some steps in that direction. They sold off a chunk of their alibaba stop. They have an enormous holding in alibaba. The chinese ecommerce company. They are selling a bit of their domestic wireless operation, which is softbank corp. , and they own a stake in tmobile, the u. S. Wireless operator, because they merged sprint into that and got an equity stake, so sources have told us they are selling a big chunk of that business to raise cash and they are going to use that to buy back the stock and then also to pay down some of the debt that theyve got. Shery what is next for softbank . We have seen historic losses for the company, for the vision fund as well, and what difference a year has made, so if they are trying to really upset all of these losses, what is in store in the future when these Portfolio Companies seem to be suffering . Peter for the vision fund in particular, this is a cleanup job. You are exactly right. A year ago, the fund was reporting profits and then we got this record loss of 18 billion. It is really a cleanup job. They have about 90 startups in that portfolio. We have heard mostly about the big disasters there. Of most glaring example that. They wrote down that company yet again. At one point, it was worth 47 billion. They have it on the books at about 3 billion, so much lower. Theres also scores of companies we have not really written about, have not heard that much about, and some of those companies and the partners there, they are hoping they will be able to regain ground and do reasonably well. Many of them are involved in the sharing economy, not just sharing office space but also sharing cars or other kinds of assets. The ridehailing companies, which is the biggest bat from the vision fund, those companies are also struggling a bit at this point. We have seen the uber share price but softbank also has a stake in southeast asia, in china, and all these companies are kind of struggling with the new rules of the game after the coronavirus. Tech executive editor, Peter Elstrom, with us with the latest on softbank. Lets get you a quick check of the latest business flash headlines. Boeing launched a wave of new job cuts, telling almost 7000 employees they have to leave. The collapse in air travel has crippled demand for new planes with boeing already struggling with the fallout from the ground at 737 max. Boeing said it needs to cut around 15,000 physicians as it and its customers fight for survival. Airbus is also weighing job cuts. Lufthansas rescue has stalled as the airline Supervisory Board rejected the state bailout over e. U. Demands about the 10 billion package. Brussels is demanding the surrender of airports as part of its support and lufthansa said it cannot agree that the carrier is looking at alternative scenarios, although it says the state rescue remains the only viable solution. Foricas historic returns manned space flights nasa put the plug on pulled the plug on a mission which would have been the first spacex will try again this saturday in the hope of ending masses reliance on russia to the International Space station. Nissan is aiming to resume production in the u. S. At the start of next month. It says Vehicle Assembly will return in massachusetts and its engine factory in tennessee on june 1. They will restart another tennessee plant one week later. Coming up next, chinas npc is set to vote on the controversial new National Security law later today. We will get you a wrap on the annual event with bonnie. This is bloomberg. Karina this is daybreak asia. I am Karina Mitchell at the first word headlines. Hong kongs first major antichina demonstration saw a Huge Police Presence close down protests. It forced the shelving of a bill on a tradition to china. Protests spread across the city. Police fired pepper spray and arrested 300 people. Huawei has failed in its initial detention in canada, leaving her under house arrest. A judge in vancouver ruled her case meets a key test of law. It is also a crime in canada. They are accused of conspiring to defraud banks over Technology Transactions with iran in defiance of u. S. Sanctions. President trump is set to sign a social Media Executive order after twitter began Fact Checking his tweets. Earlier, he claimed they are trying to silence conservative voices. The president used twitter to announce a threat to shut down the site did not mention any platform by name. Twitter added Fact Checking to his tweets after a string of messages about u. S. Voting procedures. Despite refusing to rising anger at his conservative party and across the country. Dominic cummings continues to ignore calls to quit or even apologize for breaking virus lockdown rules and the Prime Minister remains firmly in support of him. He says he wants the government on even party to focus wider messages. 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. This is bloomberg. Shery. Shery the Chinese Embassy is hitting back against the u. S. , on even wider messages. Global news, 24 hours a day, on weighing in on hong kong, saying the citys affairs are an internal matter. This after the Trump Administration that he can no longer certify hong kongs political autonomy from china following the new security laws. He is said to vote on the move later today. Senior advisord for asia, bonnie glaser. Great to have you with us. We have now secretary pompeos statement on hong kong but what does this actually mean in practice . Not necessarily automatically revoke the u. S. China policy act of 1992, right . Where does this go from here . Exactly right. Secretary of state pompeo essentially laid down the United States intends to declare that hong kong is not sufficiently autonomous to continue a enjoying its unique treatment and relations with the United States under the Hong Kong Policy act. The next step is that congress has to send has to receive from the state department a report actually declaring that sufficientill cause no longer has sufficient autonomy. There will be discussions between congress and the admin assertion about how to proceed. Do they withdraw the special trading status that hong kong has . Kong to allect hong of the laws that exist for Mainland China . This could be slow rolled. I do not expect that this is going to take place over a long period of time, but issues like tariffs, export controls, investment limits, extradition, travel, immigration, regulations, all of those that exist in u. S. Policy toward Mainland China would now be applied to hong kong. Shery does that mean we could see the sanctions, the freezing of assets, even before we see the special trading status of hong kong being actually revoked . I ask this question because we have the sense that in the house, passing the uyghur bill over human rights abuses bonnie those sanctions are likely different than sanctions on individuals and possibly entities from the Chinese Communist party that are found to be in violation of chinas commitment to keep hong kong autonomous. We could see sanctions in both of those cases. Of thethe sequencing policies that the United States adopts has yet to be determined. This is really a first step. Haidi in terms of this National Security law, we heard the reaction from the Chinese Embassy in the u. S. , saying, again, it has been the party line from supporters that the scope is very narrow, so if you are not a criminal who is threatening National Security, than most people in hong kong, companies, people doing business, will not have to worry about it. Is that your understanding of how the mainland Chinese Security mechanism would work . Bonnie we dont know. There is no draft mall yet. We do not know the language. The move by the United States today is in part designed to deter china from going ahead and creating language that might be really farreaching in granting sweeping new powers to limit personal freedoms of residents in hong kong. But i think it is reasonable to be worried. I have her chinese Officials Say that some of the violent protests that took place in hong kong last year were actually terrorist actions so if they criminalize protests as terrorist action, they could be subject to long jail sentences, so that is just one example, perhaps extreme. I am not really confident that the chinese are going to craft this law in a way that it will only be targeted at a small number of people and not interfere with the freedoms in hong kong. Thei is there concern that increased sort of tone of condemnation from the u. S. Will just feed into the narrative that you hear in hong kong and in the mainland that, you know, the process that we see in hong kong, the sort of subversion tactics, if you will, are being funded by foreign players, and it is an emblem of foreign interference from the u. S. , which has tried to take down the rise of china . Bonnie unfortunately, if we go back to last year when the protests were taking place virtually every weekend, beijing did create this narrative, the foreign intervention is significant. The United States was behind the protest. There is no evidence of that. We understand why the chinese would want to create that kind of disinformation. Very fewhat there are people outside of Mainland China who really take that seriously. We are talking about so many different aspects of these tensions between the u. S. And china. We are talking about the human rights, the uyghur bill. We also have ongoing tensions with huawei, the banning of sales to Chinese Tech Companies as well. Where is this all leading us . We continue to see these tensions and a lot of people have said it is too simplistic to compare what is happening right now, to say the cold war between the u. S. And russia that china is too intertwined with the Global Economy and yet, it seems, this decoupling of the two economies is inevitable. I do not think we will have a firewall between the United States and china and have no trade. I think there will be decoupling in some sectors where the United States wants to reduce reliance on china and medical supplies and telecommunications are going to be at the top of that list. There certainly will be others but i do not think we are going to see the two economies completely decoupled. I do think you are right that there is an evergrowing list of areas that the u. S. And china have a great deal of friction and even acrimony over. Be every day, it seems to yet another issue that has boiled up to the top. I think one of the unfortunate consequences of this is that china use to prioritize the stability of the u. S. China relationship, and i think, sometimes, the u. S. Was able to moderate some of chinas worst instincts in its foreign policy. Toause it would threaten take retaliatory steps and then china might rethink how it was going to move ahead going forward. Now, i think that the chinese have really written off the u. S. They are not listening anymore. They do not like the secretary of state so they do not engage with the state department. Theres very few dialogue mechanisms between the two countries, and even Crisis Management mechanisms are really not working very well, so this is a worrisome time, especially if the u. S. Goes into the president ial campaign in earnest over the next six months. China is going to be a punching bag. I think the relationship is going to deteriorate further and we have not yet seen the bottom. Haidi bonnie glaser, always great having you and your insight. Coming up next, an exclusive with the new york fed president , John Williams, and he says that the economic downturn from covid19 may be near the bottom. Do not want to miss out on that interview, which is next. This is bloomberg. Shery new york fed president says policymakers i thinking very hard about targeting specific yields on treasury securities as a way of ensuring borrowing costs stay at rock bottom. He spoke exclusively to bloomberg earlier. John these are issues that we are obviously studying very careful and we will obviously be discussing as a group so i do not have anything that i can say about what will and will not happen, but really, my view is that the focus is always on just how do we best use the tools that we have, how do we best use whether our communications or guidance, how do we use whether it is a Balance Sheet or other action that we take to achieve our goal . It really depends on how the economy is likely to evolve, and right now, theres a lot of uncertainty about that. I think we are kind of been a good place in terms of may be we are near the bottom in terms of the economic downturn, and hopefully, we will start seeing improvement in the coming months. I expect to see a pretty significant rebound in the second half of this year, but i think the answer to your question is what the right policy response and policy action is. It will depend on which path we see in the coming months, and right now, that is still a pretty unclear picture. We will get a lot better information over time. And whateen the trough kind of rebound or recovery will we see . Even though it is unclear going forward, have you imagine what it is like on the others because i know you think about things like this. When we came out of the great financial crisis, potential growth was lower and around 2 or a little bit less. What do you think potential growth is going to be when we come out of this . I want to follow up by asking, are we in a defective treasury fed accord in the sense that you are going to have trillions of dollars in loans at zero or low Interest Rates that would really be crippling if rates went up, especially to the u. S. Treasury . Are you going to be stuck keeping rates low even if you do not want to for a very long time . John it is hard enough to forecast where the economy is going to be going over the next several months or quarters. Forecasting more potential years in the next several is difficult. We want to make sure theres businesses and households who are able to get through this period, and we do not have lasting damage to the economy, lasting damage to our economys potential. The way i view it is the policies we are taking, the Actions Congress has been taking, are really to not only minimize the spillovers from the pandemic on the economy but to minimize the longerterm damage to the economy. In terms of your second question, the treasury obviously is issuing an enormous amount of debt due to the various spending programs that have passed, so there is an anonymous demand enormous demand locally, especially given the movement away from riskier assets, so you know, we have not seen any signs globally foremand u. S. Treasury securities. Markets have absorbed that increase in supply very effectively. Rates are still very low. This is not a situation where the Federal Reserve is somewhat constrained, limited in what we are doing because of what is happening in terms of the issuance of Debt Securities by the u. S. Government. Michael one quick followup, very quickly here, to something you said about a trough. We are opening up again. Do you think borrowing a second wave of the virus, that we have seen the worst now . John it is hard to say because the data we have is incomplete. Ofare looking at a lot little indicators we will get a report from may to give a bigger picture. We will get more data over the next few weeks and months. Based on what we are seeing now, i think we are pretty close. Maybe may or june will be the low point right now based on what we are seeing, but lets not forget that this is an extreme decline in economic activity, and enormous hardship for people in the country. We are starting to see perhaps stabilization in terms of the economy and maybe a little bit of little indicators we will get a report from may to give a bigger a pickup. We are still in a very difficult situation. That was new york fed president John Williams speaking to us earlier exclusively. As the fed looks at the yield curve control issued, the bank of korea is asking how much more stimulus is needed to help the struggling economy. Kathleen hays is here, watching all of this. Lets start off with the fed. Is it about to follow the bank of japan and go for my sisi for that . Kathleen it is clear when you listen to John Williams, president of the new york fed, the number three guy at the fed, but also john bullard, they make it clear that they are thinking about any kind of tools they may have to use and i do not think it is too surprising. John williams says yield curve control would complement forward guidance. Going toif i am not raise rates until unemployment falls to a certain point, maybe youll change your behavior as a business, as an investor. Very importantly, it could be considered. Rates are so low, they are expected to stay low. I think that puts it in a very important perspective. Jim bullard speaking about the economy in agreement with mr. Williams that it may have dropped. Troughed. It may have troughed in april. In terms of the economy bottoming, as John Williams said, when you look at the feds beige book, it was ahead of the june tent meeting that they gather information. Book lete me read you a key sentence. Economic activity declined in all districts following sharply in most, reflecting falling sharply and most, reflecting disruptions from the covid19 pandemic. Claimsw, jobless this week, expected to be 2 million. When John Williams said we may have a rebound but things will be tough, that is the kind of thing he is referring to. Comingseeing measures from the bank of korea. What are we expecting in terms of the Interest Rate . They are well, expected to move, and i think what we have to remember you look around the world push virus and tothe protect the economy, protect its citizens. They are a major exporter. The 11th biggest economy in the world is the worlds fourth biggest exporter. Their trade partners are hurting. Chinese people are not buying a lot. You can see that in so many economies, so many nations, to which korea export. That could be a problem for them, and that is why 18 to 23 economists see a 25 basis point cut. We can look at the chart from the bloomberg, as i talk about this. Lets go down to 0. 5 . One of the people in the survey sees a cut actually of 50 basis points. Look at that chart. The bread line has a seven day repo red line has a seven day repo rate. Yellow would drop down 2. 5 . Two. 5 . To. 5 . That is one reason we see such a low 0. 85 yield on that threeyearold bond. Governor lee in fact has indicated that the bank of korea could buy more bonds to stabilize markets. A big reason why people are looking for the bok to say some thing about boosting bond purchases is because president moon is talking about a third budget. Make a budget. That is why i think people are expecting to hear from the bank of korea today. Shery kathleen hays. Coming up next, disney is planning to reopen its flagship orlando theme park in july 1 full month after rivals such as universal. We hear from the ceo. This is bloomberg. Haidi disney is making progress on its path to reopening, albeit in baby steps. The Company Plans to open parks in mid july. That is more than a full month. Later than other rivals such as universal. The ceo told us why he is taking a more cautious approach than other operators. We always said we would not open up until we thought we could do so responsibly. We have got some learnings from shanghai, some learnings from our own Disney Springs retail and dining area we opened up a week ago, and we have been able to make some learnings in terms of how you keep that social distancing. That is the key for us, keeping that six feet social distancing no matter whether it be a nest on, main street, or elsewhere. We are confident we can do that and open up as possible. Universal is planning to open up june 5. Why one month later . Bob for us, we feel that this is the right time for us, in july. We have got a different situation than universal buzz because we are much bigger, much more complex business. We have got a different labor situation, and at the same time, we are also going to be implementing a new reservation system for our guest and it is going to take some time to take the millions of reservations we have already got and then switch that over to a new reservation system so we think july is the right time for us. Lets talk about some of your learnings. You have been doing the temperature checks. Our people actually showing up with fevers and getting turned away . Have you gotten to that 30 capacity yet, and when do you plan to go beyond that . Bob everything has gone extremely well in shanghai and i must complement not only our cast but the guest for their cooperation for the whole thing because it really takes the chemistry between both groups in order to make this whole thing work with social distancing, and you know, so, for us, the learning is that we have stuck to our limitations that we have placed on ourselves, and it has worked extremely well. We are up to 20,000 guests we take per day and we are maintaining the social distancing guidelines that the government has placed upon us, and we believe that as those social distancing guidelines are relaxed or changed, we will be able to grow with it and really please even more guests than we can today. Do you have a sense of which resorts will be next and when . I know you have gotten the green light to open Downtown Disney and california. What about hong kong, tokyo, paris, and disneyland itself . Bob we have no announcement we are ready to make on those other parks. As you know, they are all in areas with fun situations. Different situations in terms of the progress in terms of the covid19 pandemic and also different situations in terms of where the government sort of in providinge at some level of assurances that it is going to be responsible to open up. We have to take our cues from each local government in each place. We like to say it does need that we are really just a citizen of the environments we operate in and we want to be a good citizen so we really do follow the lead of the local government as our cue and then overlay good common sense from the disney standpoint and that determines our opening date. Chapekdisney ceo bob there. Soaring after revenue doubled last year and net profit hit more than 3 billion. The worlds most valuable start up is said to be worth 150 to 180 billion, having attracted users 1. 5 billion monthly to a family of apps that includes tictoc and others. Coming up, we will be speaking to the bank of america korea economist on the bank of korea policy decision. This is bloomberg. Good Global Headquarters in new york. In sydney asias meza major markets have just open for trade. Welcome to bloomberg daybreak asia. Hong kong faces an uncertain future in the u. S. Saying it is known or separate from china with trade relations and that city special status coming under review. That uncertainty gives asian markets more to consider along with the coronavirus and slipping level demand. The encz mark is aiming for a fourth straight day of gains the benchmark sees a fourth straight day of gains. We take a look ahead to earnings do out later today. And we have breaking now out of china. We are getting the latest coronavirus cases. Two cases on may 27, china asymptomatic cases on may 27 and global cases approaching 6 million as deaths across the United States have topped 100,000. Lets see how the markets are reacting to news on the credit virus headlines news on the virus and tensions between the u. S. And china. A fourthi gaining an consecutive session at the highest level now since february. Gains foren massive the japanese stock markets as we continue to hear about more plans for a second supplement tree budget. Supplementary budget. Investors in the bond markets awaiting the extra debt issuance that could exceed 1 trillion. Take a look at what korea is doing. The kospi is gaining ground for a fourth consecutive session. We are awaiting the bank of korea policy decision today, the expectation is for a rate cut to a record low of. 5 . Withve a lot of concerns all of the easing of our Household Debt in south korea. South korean banks have been hammered but korean discretionary stocks are gaining ground this week and we are seeing more Consumer Optimism over the reopening of global economies. And when you talk about the pricing this of australian stocks, those valuations continue to climb. In the early part of the session we are seeing gains of extended 2. 9 and still climbing extended to. 9 and still climbing. And we have an eye on consumer stocks. Np capital investor showing consumer stocks are likely to have hit their bottoms and now getting a boost from the reopening of the economy with further restrictions to be lifted from next week. We are watching also the aussie dollar, sensitive to political concerns, given that we had the offshore yuan trading at is lowell lowest level on record. Seeingthe few indicators across broader markets reacted to geopolitical tensions. In new zealand, four days of gains, not held back despite april jobs numbers seeing the worst decline since at least 1999, as that economy continues to recover from the lockdown restrictions. Inry the chinese ever see the u. S. Is pushing back on claims chinese autonomy is gone calling for no external interference. Administration could trigger sanctions after the Financial Hub trading status with the states, that could be affected. Our bloomberg coanchor Tom Mackenzie is watching all of this. He is outside the forbidden city in beijing. Is this the historic flashpoint when it comes to u. S. China tensions . We also had the embassy saying that if the embassy continues there will be countermeasures. It is certainly significant, in terms of the history of u. S. China ties. 1992, this is when the u. S. Came to an agreement with china and hong kong, which was then run by the british, two and sure it had a different trading status. A special trading status, versus Mainland China. That has continued until the present day. Tariffs implied or applied to Mainland China by the u. S. Do not apply to hong kong. In terms of restrictions on to mainlandxports china, those do not apply to mainland two hong kong. And other measures as well. But now those measures are being reviewed. We had a statement from the chinese to mainland embassy in washington, saying this is an internal matter, but also stressing the security law that appears to have accelerated this decision by the state department in the u. S. , the security law was targeted at a narrow set of acts that threaten the security of hong kong, according to this statement. It went on to say the fundamental freedoms of the people in hong kong and the higher degree of autonomy, would not be impacted. And that neither would be they foreign businesses operating in hong kong, and foreign investors. That was the response from the chinese side. In the last few weeks we have had state media here and spokespeople at officials reintegrating, that china is prepared to hit back with countermeasures. They have not specified what they would be, but we know they have an unreliable entities less they could resort to. So we have had this response from china. Pompeo going to congress and saying theres no way you can say that hong kong has a high degree of autonomy and we know the administration is looking at options. Shery and we have more measures in the u. S. Washington is planning to join an International Organization that will advise companies and governments on the responsible development of artificial intelligence, becoming the last of the group of seven countries to sign on. This Global Partnership on ai is expected to start rock limitations to encourage the creations of Ai Technologies and those that respect privacy and civil liberties, according to the u. S. Chief technology officer. It has been this tech battle ongoing between the u. S. And china. Well and huawei, what we know on the extradition case for the cfo . Uf the u. S. Accuses the cfo of huawei of fraud and financial mismanagement, in terms of how she discussed certain trades between huawei and iran, with certain foreign banks, notably hsbc. And they have called for her extradition. She was arrested in canada. What she has failed to do in front of a canadian judge is persuade them to drop this extradition case. So the legal case continues. Strongly denies these allegations from the United States and has a separate legal case challenging the canadian authorities over the way they arrested and handled her case. Continue wranglings but the numbers, in terms of previous extradition cases between the u. S. And canada, do not look to be in her favor. It seems likely at this stage she will ultimately be extradited to the United States, to face the charges. But the legal challenges continue. And you are right to say that in the framing of the u. S. China relationship, this is an important area of of course, for the United States, what they are trying to curtail the activities a threat tock security globally when it comes to Global Technology and 5g. Shery still ahead we assess the outlook for hong kongs former Legislative Council and the president joins us in 30 minutes from now. Hoveringffshore yuan around an alltime low against the dollar. Analysis on chinas currency, next, as you little tensions ratchet higher. This is bloomberg. Karina youre watching bloomberg daybreak asia. Rights. Asserts human abuses against muslim minority. The overwhelming vote means the legislation passed by the senate now goes to president trump. More than a million minorities are being held in internment camps in chinas western region, for what beijing calls retraining. Hong kongs first major antichina demonstrations of 2020 saw a Huge Police Presence. Most protests riots swat right squads permitted any approach the Legislative Council building. Stopped protests extradition bill for china. The police used pepper spray and arrested 300 people. Brazil is vowing to keep the economy alive japan japan is going to be economy alive with support to health care, households and regional economies supported by a budget that break the record for Government Spending set last month. The European Central bank says the Single Market is deteriorating and heading for a recession as bad as its most pessimistic forecast. Christine lagarde and her colleagues say output is said to shrink by as much as 12 , as the coronavirus lockdown is jobs and stalls business activities. E. U. Proposes a new stimulus package worth 800 billion u. S. Dollars. Global news 24 hours a day on air and at quicktake by bloomberg. Powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Haidi we are getting lines out from the r. B. I. Governor speaking before the Senate Select committee on covid19, giving an update on the impact of the Monetary Policy measures on the economic recovery as australia starts to reopen its economy and goes back to work. He is saying the it is possible that the downturn we have seen as a result of cover 19 will not they earlier thought, but will keep expansionary settings when it comes to policy until jobs and inflation goals are met. The recovery depends on how quickly confidence is restored. The reform agenda what encourage investment in that more hiring and reallyas well, looking at whether there Consumer Confidence side of things and Business Confidence is going to drive most of the recovery, they say. If you are a bloomberg subscriber you can continue watching phil lowes testimony andife go on the bloomberg diary entries for today and the rest of the week and catch up on any events you may have missed out earlier. Liv on the bloomberg. Asx 500e are seeing the gain ground in financials and tack. And seeing financials dock and technology. Pointing lower with the u. S. China tensions escalating. Fromstrategist joins us singapore. The chinese yuan now at the lowest level since september, 2019 against the u. S. Dollar. Watch would be watching as the mpc is wrapping up today . Npc. Trader starting to get bearish on the wanted. Overnight we got close to 720 four the dollar against the offshore yuan, which is the alltime high for that pair. This morning it is it touch slower but it has not gone down now far, and we are waiting for the pboc fixing. What we saw yesterday was the pboc fixed at you want on the strong side, but the market seemed to mostly ignore that. We saw during the day that dollaryuan start to creep higher throughout the trading session, as people were concerned United States could respond with more sanctions. You have one set already, with that uighur bill and secretary of state talking about hong kong. There could be more in the works. Traders are taking up very defensive postures. We are seeing activity the Options Markets suggesting people see they expect the dollar you want to get higher of the next couple of months and buying options fraud higher price. We are seeing a pickup in activity over the last when he for hours and we expect to see erratic trading tomorrow is the day develops after the pboc fixing. It about one hours time. We also expect another level of shock cannot when it comes to record stimulus from japan. A level of shock and. Shock and awe. Some describe depends to millis at the biggest of any country in the world some describe japans stimulus as biggest of any country in the world, equivalent to 1. 1 trillion u. S. Dollars. When you add it to what theyve already done plus the bank of japan came out with a special package last week. All levers of japanese authorities are doing everything that they can. The government and the bank of japan are really moving in tandem here, to prop up the economy and help specific business, and to get back on its feet. You can see the reaction in Japanese Equities has been good, again, 1 higher this morning. And it seems to have turned the corner now and people are taking it seriously. If you look at small companies, they are doing even better. The rebound in the tst mothers index has been extraordinary. It has been one of the guest rebounds from one of the biggest rebounds for march of any index in the world. There is more optimism now about japanese stocks, people believing the government has put money on the table, and it will start fixing things a man at last there is a strong tailwind, which could lift up any stocks relative to other performers in asia. Haidi and you can follow along on this story all the rest of ourdays trading action on markets live on the bloomberg at mliv commentary and analysis by bloombergs expert editors so you can get news on exactly what is affecting your investments right now. Coming up next on bloomberg daybreak asia. Of bankiew of the bank of korea and monetary decisions. This is bloomberg. Shery the bank of korea is expected to cut its key Interest Rate to a record low when it meets later. 18 of 23 Analyst Survey by bloomberg expect them to cut rates by. 25 basis points by two any five basis points but our next guest disagrees. You expect no change in may, but cut in july . Tell us your rationale. What i did make sense to frontload all the policy actions now, to get the economy a stronger boost . Sure, we do have one more rate cut penciled in for this year. But we think the timing of it will come in july rather than today. Domestic week consumption data from the First Quarter, and the data deteriorating in the Second Quarter, plus that headline cpi heading further down the headline data heading for the downturn is your rate, this pointed to a rate cut as soon as this morning. But remember in march, they had [indiscernible] and at that meeting we had one person calling for a 25 basis rate cut instead of 50. So we think while the be ok is aware of the weakness in the economy, it is also very much cautious to take another step towards your rates, towards toward es , while at zero rates, with limited room for more easing in the future. After digesting the Second Quarter data of investment bottoming out and by july they will be fully convinced to make a rate cut than. Shery they do have to see the extra budget coming from the government, right . Pledged stimulus is already 13 of gdp. How much of a difference with his make to the economy . Will this make . Devin proactive about boosting economy is aggressive fiscal expansion. We have the first and second budgets in march and april already. We have the first and second budgets in march and april already. If they are instituted more swiftly throughout the Second Quarter and third quarter, that would boost gdp at least 0. 3 to 0. 4 upward. Plus, the third budget the parties currently discussing, which is expected to exceed the first and second budget combined , to at least 40 trillion korean won, equivalent to 2. 2 of gdp. That should give further upside to the headline number what we need to check the details of it. The breakdown of it may make a difference in terms of giving a fiscal multiplier a push. As the bank of korea likely to give signaling on debt monetization today . We expect be ok to discuss some bok to discuss details on the plan for nontraditional Monetary Policy tools. We expect to see now, not so much details of what we see in the u. S. Or europe, in the form of qe, but more details about the Purchase Plan they started to discuss in april. So far, they have done to to do the purchase loads in march and april with a total size of 3 trillion. Ttd. With a larger than expected supplementary budget they have to come in and adjust the dynamic the dinette the demand dynamic of the bond market. We expect to see details of the size, timing and possibly tenure of bonds they are planning to purchase. They so far have been quite evasive in terms of giving these details, but the market expectation is quite high, in terms of hearing some more okecific plans the be ok b is expected to execute in the coming quarters. Abroadwe have seen rebound for korean stocks. That has largely been driven by these optimistic views. , because there was never a compulsory shutdown in korea, the economy can never have a fuller and quicker rebound compared with others around the region. Is the missing factor going to be the external demand, given how relying the economy is on export demand . Youre right. Modelhas demonstrated a case of effective containment, no nationwide lockdowns. Local authorities have employed aggressive testing strategy. That has been very effective in keeping the outbreak under control to mystically. Domestically. A spark from the coronavirus data, the Economic Data is going to reflect much of the global lockdown and constructions contractions from the aggregate demand and export data in the Second Quarter and throughout this year. We recently revised our gdp forecast downward. We now think the korean economy will contract by 0. 2 this year. Domestic consumption is expected to recover as the economy is reopening. But we can see from week Employment Data and the expected decline in Household Income likely to trigger gradual recovery in domestic activity. Data. K employment on top of that, the sharper downturn in the u. S. And we expect a recession should give further downward pressure on the numbers as well. See technology exports showing solid growth. But it is the issue with the nontechnology exports, refinery and petrochemicals, and Petroleum Exports that have been bottoming, touching 50 yearoveryear. Also the autos and auto parts combined 10 of exports, also going to slow down the headline. Combined together we do think sentiment is lifting, but the data is going to pick up very gradually, compared to the market sentiment. Haidi thank you so much for americaus, bank of securities korea economist. Rbaontinue to hear from governor speaking to the legislature on covid19 saying the downturn could be less impactful that expected but also warning they are unlikely to raise rates for a few years and it will be a long drawn out process to get back to full employment, and we have seen record numbers of on a plum it here in australia, and that they will not be raising rates until jobs and and inflation is met. We are seeing early gains in the session in asia, shrugging geopolitical concerns, words between washington and hong kong , even with mike pompeo statements on hong kong. Thise seeing optimism in thursday session, the japanese nikkei to divide climbing. Also gains ahead of the bank of korea decision where analyst expect 25 basis points the record. 5 . Strong gains here in australia at with 1. 7 to the upside, the highest since march 10 and these valuations continuing to climb. Feeding into this is optimism, measured optimism coming from the wert reserve bank of australia of and are the moment testimony by videoconference saying the downturn may not be as bad or as long as expected. Saying that rates will remain low as long as inflation and jobs targets are not met. And morning there is a risk of withdrawing supportive Monetary Policy, to quickly. Some of these comments clearly supporting the aussie dollar and what we are seeing here in terms of more exuberance in the markets. New zealand also on track for a fourth day of gains today. Shery one stock we are watching , nissan sharply higher today, at the highest level since march. This after the carmaker announced plans to deepen its ties further with renault and mitsubishi. The turk the trio has further measures to whether the last demand for autos. Weather. The alliance was under pressure after the departure of a senior staffer. Does what does this mean . You have to remember how nissan got here. Last era it was about volume. Nissan was trying to become the number one or number two automaker in the world, together with the alliance with renault and mitsubishi motors. Uscourse, carlos ghosn arrested in 2018 followed by management terminal an aging vehicle lineup. In the credit virus has changed the dynamic. Nissan needs to retrench and take a hard look at its cost and there out how to preserve business it has rather than chasing growth. Haidi what are the most see stomach issues that would manage to address systemic issues . The plan is calling for ¥300 billion in cost cuts, to put a billion dollars, based on a reporting. They are going to take a hard look at production lines, and look at marketing research, manufacturing costs. That is essentially going to bring down the Companies Capacity companys output capacity to 5. 4 million vehicles per year, down from 7. 2 million, and that should improve profitability. The question is where is sales going to go in the current environment . And renewing the lineup. Nissan plans to introduce a new rogue, a small crossover suv, in the u. S. Later this year. That is going to address some revenue issues it faces going forward. Haidi our bloomberg Senior Editor there in tokyo on nissan starting today. Lets get you a look at the latest business flash headlines a 27 year low with a charge and cost for an indian based carrier and the crown pandemic hit revenue. Income plunged 65 to 700 million u. S. The company gets half its revenue from a blot including in india where debt from abroad including india where a court ruling left them owing billions of dollars in fees. Trade afterate porting declining sales as crowbars hit its supply chain. Slightly below what analysts had foreseen. Coronavirus. Hb will delay its 50 million 15be buyback until buyback into the market stabilizes. That is expected in the current quarter. Softbank planning deep cuts in its vision fund which could affect 10 of its level staff. And employs five fed people, mostly in tokyo, london and San Francisco 500 people. Softbank has been hit by poor performance after the fund bet on startups including wework, whose planned ipo collapsed last year. Shery next we will look at the future of hong kong and what the security built means going forward, with the former president of the hong kong legislate of counsel. This is bloomberg. Karina this is bloomberg daybreak asia. Cases are nowirus above 5. 5 million, with u. S. Deaths passing 100,000. Your remains the worst hit state with new york governor under, calling for federal funds to alleviate the economic fallout. New york city mayor bill de blasio it sees a 9 billion hole in the budget, worse than the estimated shortfalls released last month. U. K. Prime minister Boris Johnson is refusing to sack is top a despite rising anger at his conservative party and across the country. Dominic cummings continues to ignore call to quit or apologize for raking virus lockdown rules. The for breaking rules. Johnson remains in support of him. Its initialailed in bid to free the cfo in detention for from detention in canada in canada as the essex to have percent to america. To have hurt sent to america to have her sent to america. By washington of conspiring to defraud banks with Technology Transactions with iran it finds of you sanctions. President trump is set to sign a social Media Executive order after twitter began Fact Checking his tweets. Earlier he said they were trained to silence conservative voices and must change course. He used twitter to announce the threat to shut down the site but did not mention any platform that by name. Twitter added Fact Checking to his tweets after a string of messages about u. S. Voting procedures. Global news 24 hours a day on air and at quicktake by bloomberg. Powered by more than 2700 journalists and analysts in more than 120 countries. I am Karina Mitchell. This is bloomberg. Shery how markets are trading at the moment. We are seeing broad outside for that nisei, kospi and as x 200. The nikkei the highest since february. Financials leading the gains. We have left of the state of emergency everywhere in the country. The kospi higher ahead of the bank of create Rate Decision later today. Haidi lets get back to our top story, hong kongs future as a financial leader is in question after that Trump Administration says it could no longer certify the countries political autonomy from china. The decisions could have farreaching decisions consequences on Hong Kong Special trading status with the u. S. Joining us is the first president of the hong kong Legislative Council and the member of the Standing Committee on the peoples congress. Wonderful to have you with us. Pass this expected to highly congressional and very vague National Secure a lot today and we have seen their actions from the u. S. Mike pompeo saying hong kong cannot be said to be political autonomous and that opens the door to anything from sanctions to trade tariffs to goods coming from hong kong. Is it really worth it for beijing to do this . First of all, lets get the procedure right. No law is going to be passed today. Of the only a decision National Peoples congress, to do a number of things, including asking their Standing Committee, to draft and pass a law, to protect National Security in hong kong. That procedure will probably three to four months, we do not know yet. The context of that law is not yet clear. But, the purpose is clear. It wanted to have lost in hong kong against the tradition of the country, the traditional separation of the government, the christians in the country, the interference from foreign powers, and the tariffs act in hong kong. I think that law will affect the majority of hong kong people. It will affect those who are trying to breakup china. Who are trying to subvert the government. Who are trying to scare the hong kong people with their terrorist tactics and foreign organizations who would interfere in hong kong affairs. Saw theaid that, i also news this morning. There is nothing we can do in hong kong to influence United States. At the secretary of state wanted statusve certain special from hong kong, which is not granted by the United States. It is in the wto, that wto agreement. You are free to do that. But lets look at it from the hong kong point of view. A person living in hong kong, like me, retired. What are my choices . Lifeld go on living my of these blackt, dressed rioters, hoodlums, who threaten my freedom in my rights. Every weekend i do not go out without checking whether they are blocking any streets or whether they are having an upper in the shopping mall, where i want to get some supplies. If this goes on, there will be no future hong kong. In fact these people made it quite clear that what they want kong withto make hong them. Hong kong ghost on the drain. The other choice is the central authorities come of the National Peoples congress will try to do something. Laws whichnt the will protect hong kong from all these, all things i just stated, which will actually destroy it, our prosperity, and stability. , even if circumstances United States or Trumps Administration does anything, whatever they like to do, i do not think we will be any worse situation than allowing is hoodlums, black hooded hoodlums, to go on destroying our daily life. We just want to go back to our peaceful life. What about the threat to one country, two systems . What about the threat to institutional ledge msc . Institutional legitimacy . You can say you trust beijing to draft this law to be narrow in scope, but will it be applied as set . Because applied as such . Because you know that when it when it comes to mainland judicial discretion, you have things like arbitrary arrest and arbitrary detention. From political subversion to shortselling the market there. So with that happen in hong kong . I do not note first if what youre sing about the mainland is true or not. In the mainstream we have first, i do not know if what you are saying about the mainland is true or not. You have media reporting about things but not the good things come of the improvements they have been making. The same in hong kong, they only report about what they think is Police Brutality and not an elderly judgment being hit by a brick on the head and died. They never report the person where they set fire to him, these are not reported. Haidi i would like to point out, we do make best efforts to report both sides of the story of bloomberg. Yes, well, i am glad. Position they are going, the National Peoples congress are going to vote on today, there are six points altogether. Point, isand foremost to ensure that one country, two systems, will continue on. Hong kong people governing hong kong. The high degree of autonomy. All this will be upheld. If all of that is insured anyway, the question is, if nothing meaningfully will change, why do this now, in the middle of a pandemic . What is the purpose, when you also have rising tensions with the u. S. , and other issues beijing needs to focus on . Actually when we had the epidemic, we were having a bit of rest. The streets were quiet. Now that the government, hong kong government, was able to control and they did a very good , wein controlling covid19 peopleeeing these black starting to come out onto the street, to block the street, to set fire, and then we see [indiscernible] lawyer in his 40s was hurt. [inaudible] people. Essed this is coming back to us. Wen we have crossed, when were going to win the battle against covid19, we will face the same situation. It is not going to leave. Is that your thought that beijings stance on hong kong has meaningfully changed, where it will no longer tolerate these protests . It is not really up to beijing to tolerate the protests or not. There are laws in hong kong, which protect peaceful protests. Which protects the freedom of speech. These laws are totally intact. , whichl have our courts are independent of any political stance. Have [indiscernible] the in hong kong. The court of final appeal in hong kong. These things remain intact. Moree do not want to see of these subversion, falling into [inaudible] more of these acts and we cannot stop it because our present law does not give us that ability. From need the assistance the National Peoples congress backy to return hong kong to a peaceful place, where everyone who wants to do business can do business here. Where the government will assist hong kongs business community. We shall remain as a freeport. Free free as a freak part. As a free port. Put all this would not be achievable otherwise. Thank you and breaking news out of korea, we have the be ok decision and as expected it as percent to ahalf a record low from. 7 . We have Monetary Policy really working toward that and we have seen the First Quarter gdp concernson consumption , also subdued domestic demand and the bank of crit now cutting their key Interest Rate to a record low of. 5 . This is on top of unprecedented ok including buying Corporate Bonds via social purpose vehicles. The bank of korea now cutting rates as expected. We are not seeing that much for Market Reaction at the moment but the korean won under pressure from the us dollar under pressure from the us dollar retreating. 2 . More to come on bloomberg daybreak asia. This is bloomberg. This is bloomberg. Lets get a quick check of the latest business flash headlines. Nissan jumped on news it aims to resume production with his Vehicle Assembly returning at its plant in massachusetts and its engine plant in tennessee on the first of june. Starting in another plant in tennessee one week later. Corp. Murdochs news publishes sydneys Daily Telegraph will cut 100 masthead from circulation in favor of a digital only strategy. Boeing launched a wave of job cuts telling 7000 employees they have to leave. The collapse in air travel has couple demand for new planes and boeing has said any to cut around 16,000 positions. Rival airbus is also weighing job cuts. If there was concern about capital flight from hong kong markets, china traders are putting it to rest. Investors from the mainland are buying hong kong stocks like never before. Our china markets editor joins us from hong kong. How much money are we talking about now . And where is this going . Good morning. U. S. E above 35 billion dollars so far this year, the tot for the data owing back to 2017, the back first year we had for crossborder trading. Flowingthe money is into Chinese Companies listed in hong kong. A lot of that going into big sop, stateowned enterprises, like i to bc and china construction bank. Soes. A lot of this money tends to flow into hong kong when stocks drop. This is a typical sign, behavior, coming from mainland traders. Is the 35th straight week of buying we have had last week. What are they buying . Smes. They are buying the large banks. Health care a favorite. We are not seeing buying into stocks that are exposed to the hong kong economy, nothing like the Property Development here that has really suffered in the past year with protests and the economy take you hit also from the taking ahead, also from the coronavirus outbreak. It really is mainland money at Mainland Companies in hong kong. Shery can we speculate this is also chinas National Team . Because we are not see me upside and Msc I Hong Kong which only has hong kong stocks and no mainland stocks, right . Exactly. Whether they trying to stay direct, or whether the National Team has been involved in recent buying. In 2017, when xi jinping was in hong kong to celebrate the 20th anniversary of the hanover, we do know that then dutch of the hand over, we do know that state directed funds were standing by to stabilize the market, in case there was any volatility in hong kong. We do know they have a history of preparing for such things. And we know the National Team regularly intervenes in the onshore market, to manage swings there, especially around politically sensitive dates. There is speculation. These are not retail traders buying. These are big insurers, big security companies, a lot of the brokers and china are the ones who can buy through the stock late. If you just talk link. If you are a regular investor you need to have five hunted thousand yuan. 500,000 yuan. So there is speculation there, for sure. Our china markets editor on that institutional rallying we are seeing. Before we headed over to Bloomberg Markets china open. Southlly they just had, korean cutting rates to a record low. This is bloomberg. Tom this is Bloomberg Markets china open. Souring relations with the u. S. Over trade, human rights and hong kong. We will assess the future for transpacific ties. Our other top stories, markets across the region are up for a fourth session, but hong