By market. Indonesia coming online. You are seeing a marginal gain. Although when it comes to the virus, the deadliest day yet in indonesia. The story is chinese stocks. The csi 300, we are up another 3 , extending the fiveyear highs. All four of the major benchmarks in china in overbought territory. Is it the case of foam a of fomo . The topix up by 1 . We expect the earnings season to kick off with consumer stocks. The market has underperformed as of late. We are also watching currencies. We mentioned the dollar, posting the drop. Across asia fx, a strong renminbi. Risk on move today. Brent crude, hovering around the 43 mark here. Commodities gaining ground in the second half. Copper futures slightly lower today, but up last week for the seventh straight week. Lets get context with our reporter. There seems to be a very clear upward trend when it comes to virus infections in the u. S. Several other economies have reopened. How do you see that affecting markets right now . Reporter right. One of the investors says that is jump in infections affecting it. The imposing of broader unpalatable. It is doing huge damage to the economy. If there is one thing i could highlight, it is that china was the epicenter of the virus and the chinese economy and the data rebounded two months faster than the u. S. Based on the pmi readings. The economy recovery on the mainland is well underway, despite the rising infections in beijing. That indicates that the u. S. Data can continue to improve with that time lag. U. S. Data improve even with the virus and follow in the footsteps of china . I think the mood in the risk market will remain favorable. The one thing interesting is u. S. Manufacturing and Chinese Services pmi last week are reviving interest. Asiaains are very broad in at the moment. How will this play out . Earnings season about to kick off. Could we see one of the worst quarters on record because of this virus . Reporter yeah. The rebound from the marginal lows, there has been a stopstart because of the coronavirus hotspots in the u. S. Has dominated the markets in the coming weeks. What i see are the markets late the moment, and optimism confidence has been low. Any slight beat can swing the variationnd, not sustainable at current levels, especially as the virus emerges as a threat to the economy. I think markets will continue to over thethe macro data next couple weeks, and that will likely set the direction of the markets. Thursday, we will have the weekly report for the initial jobless claims in the u. S. , and that will be a key highlight for the week. Reporter to highlight some of the catalysts we need to keep the rally going. You can follow this story on our markets live blog. There is also commentary and analysis from the expert editors. Find out what is affecting your investments right now. Halinda lets get the first word headlines now. The European Bank has warned the euro zone is facing about two years of downward pressure, but could see a turnaround after that as covid transforms the economy. Speaking during a webinar, Christine Lagarde says she expects a period of disinflation to begin, followed by inflation, and the possibility of higher rates. Inflation dynamics will be impacted with disinflation to begin with, then inflation that will occur that we will have to measure. But it will most likely be based if we have an increase on productivity on a natural increase in Interest Rates. Halinda north korea is joining new talks, saying washington is using the idea as a political tool. Relations with the u. S. And south korea collapsed last month as pyongyang accuses rivals of abandoning promises made. Says sanctions will change the relationship. Pyongyang says it has a detailed strategy for dealing with the threat. Governor has been reelected for a second term in a landslide victory as the city deals with its surgeon coronavirus cases. He challenges to win another fouryear term. Koike campaigned on her handling of the virus, hoping to address voters online. The u. S. President ial race may be in for a major shakeup with kanye west saying he is coming on board. It is not clear if it is serious, but social media exploded after he tweeted his intention to challenge donald trump and joe biden. Kanye west has 30 million followers on twitter and seems to have one the backing seems to have won the backing of elon musk. Still ahead this hour, hyundais head of fuel cells tells us why they have focused on Hydrogen Powered vehicles. Yvonne next, we speak to our guest about the rise in u. S. Coronavirus cases, and what can be done to tackle the surge. This is bloomberg. Halinda worldwide coronavirus cases have jumped to 1. 3 million, and a oneday high in global of global infections has been reported. It rose more than 2 more than the average. Lets discuss with our guest. Good to have you with us. In the first four days of july, we saw a 600,000 we saw 600,000 new infections. Is the pandemic Getting Better or worse . Nader it is definitely getting worse. That is without a doubt. As we look at the United States, the percentage of test positivity is going up significantly in a number of states. With that we are having a lot of difficulty in terms of sticking to things we know work, like social distancing, masking, and other things. Halinda more and more economies are opening up. Is it really safe to dine indoors, outdoors . Is it safe to go to birthday parties, go to the bar . What are the red lines . What should we be looking out for . West we have a few things know consistently have been true when you look across the globe, really. We know outdoors is significantly safer than outdoors. Dan indoors. Moveu can dine indoors or any social activities outdoors, that is going to be much better than doing things indoors. Ofalso know the importance masking, particularly masking indoors, but anytime you have close facetoface contact with people, we need to be Wearing Masks as well. Those types of things, we saw that happen in japan with their model. We know it can stop that super shredding super shedding event. Yvonne how do you change behaviors, like people who refuse to wear masks . You see that in parts of the u. S. In asia, we have the haunting memory of sars as a reminder, but in the u. S. , it has become much more of a political issue. Guest it has. The reality is any behavioral change is going to be complicated. Any new interventions. For the u. S. , masking is a new thing. It is not something we have done here. It is very easy to make it seem like a simple problem of just put a mask on. But there is an entire psychological process to help people integrate new behavior change into their daily routine. For a lot of people, it is not quite that simple. If you really think about epidemics and epidemic response, you have to think about it locally first. In any part of the United States, peoples aversion to masking could be different. It could be a lack of understanding about the Health Consequences or benefits, it could be completely politically driven. You have to look at the community and study it. We have seen more than 200 scientists asking the who to revise spec tatians because they are finding more evidence revise expectations because they are finding more evidence. Is it possible this virus is no airborne . Is it possible this virus is now airborne . Guest it is something we have thought about from the start. The question is, what role do aerosols play, and what percent aerosolsission is via versus respiratory droplets that hang around in the air that do not hang around in the air . There is evidence of absence and absence of evidence. If we dont have evidence, we play it conservatively. It is possible that is a route of transmission we need to be careful against. Is still a lot of doubt or questions about asymptomatic cases. Shed some light, what have we learned . A symptom medications eventually show signs . Guest here is where we were talking about asymptomatic versus presymptomatic. There are cases that are completely asymptomatic and never develop symptoms. But a much larger proportion of cases, they do end up developing symptoms. They do not show symptoms for the one or two days where they can still transmit to other people. They have replicating virus in the body, but they dont yet show symptoms. That is where we are getting hit in one of the hardest ways because we need to stop presymptomatic transmission, which is why masks are so important. Halinda of course, the focus is now on a vaccine. Where are we on that . India came out and said we could see a vaccine in six weeks. How realistic is that . Guest it is very hard for me to when. As we move into phase three trials where you have to enroll several thousand participants, those can take sometimes. We have to see what the effects are in the longer term about how much immunity these vaccines confer and if they are safe. It is hard to speculate when we will have a vaccine. In the absence of a vaccine, we know things that do work. Masking, social distancing, avoiding highrisk scenarios work. That is the best we will get until we have a vaccine. That theo you think u. S. And parts of emerging markets are seeing a spike in cases . Can they control this virus before there is a vaccine . Guest i am talking from the northeast, where we have gone through the first wave of this. We learned a lot of lessons. We learned we need to move quickly, that we need to mask. If you look at the u. S. , there are different parts of the country seeing a rapid rise in cases. Northwestthe especially are trying to relay the messages of what we know work and what doesnt work. And what works is acting quickly, listening to Public Health guidance, testing, tracing, isolating, masking, social distancing. What does not work is delaying those things while cases are rising. Am urging lee i leaders to take action quickly. Mentioned testing. Is there a better handle on testing now . What about Contact Tracing . Guest we are definitely testing more than we were in the epidemic. But the rise in cases is not just because of testing. We know that by the percentage of positive tests, which are also going up. There testing more, but cases are also growing and spreading quickly as well, and that is more than just testing. Tracing and isolating is extremely important. Where i am in massachusetts, we worked with partners in health thatn International Ngo has done tracing in subsaharan africa. We are adopting the lessons we learned from Global Health from many countries that have learned from epidemics before. We have been doing that at the statelevel here, which is important. Leave it there, but thank you so much. Worldsp, one of the biggest water and Waste ManagementCompanies Says it will take another year before business returns to normal. Our exclusive interview is next. This is bloomberg. This is Bloomberg Markets asia. Utilities have been hit hard by the pandemic with demand for treatment and Waste Services reduced globally. We spoke with bertrand camus, the ceo of suez, and asked when he sees a return to normal. Are relatingsues to the impact on issues as important as the water cycle, against pollution. Covid19 andbefore will be thereafter. It shows that these issues have to be addressed as a key priority in the future. Agreeing tos are reevaluate the economy. Commissioner, we have good reception in investments. Reporter you have mentioned the possibility previously about tracing the coronavirus in wastewater. Is any government planning on giving you a key role in surveillance in the pandemic . Guest the result of research we have been carrying out in the past month, first of all i want to make clear there is no issue for Drinking Water in the treatment processes. Is they are able to kill the virus. But we find traces of the virus in wastewater. So we are able to correlate the areence of dna and we putting in the network the ability to anticipate the wave in european countries. This is the case in france, in spain. Reporter talk to me about your business as well in the wake of covid19. How long will it take for suez to recover the volumes of water and waste treatment that has been lost by the crisis . We gave the latest information we had. It is pretty basic. All we know is we expect a loss of revenue, which correlates to the loss of volume, around 6 . The situation is very different from one continent to another. Asia has improved. It was the case in europe since midjune. Rebound very important and are starting to operate. But there are markets not up to transportation, manufacturing, and tourism, and it will take some time to get. Ack are in a situation where we think that volumes should get in 2021. Istoric levels halinda that was yvonne that was bertrand camus. Wahaha is considering an ipo that could raise 1 billion. Although no file decision has been made, wahaha employs around 1000 people. Will meet its most prominent critics this week to address concerns about hate speech and disinformation. The company long denied it does not do enough to combat racism and discrimination, but pressure from advertisers is forcing it to address the concerns. Mark zuckerberg has been playing defense as civil Rights Groups and advertisers demand more. Rollsroyce has confirmed ways to raise funds as it looks to ride out the slump in the aviation industry. Follows agine maker report saying they are considering several possibilities, including a share sale. Decisionse says no have been made, and insists its current financial position remains strong. Halinda asian markets are going strong this monday with most benchmarks up by more than 1 . Markets across the region showing improvement, but new orders showing weakness. That could mean that businesses are operating in the dark. The msci asia index up by 1 . Futures in the u. S. Pointing to a higher open. All eyes on the u. S. Weekly jobless claims report. We have the u. S. Dollar now 0. 1 . Tly a tad down, by at the where we are benchmarks in asia. Look at china, up by 3. 3 . A 52 week high. Some say it may have gone too far, too fast, if you look at one indicator. Hung saying the hang seng up by 2 . They are on track to enter able market. Lets look at some of the stocks we are watching. Mic trading by 11 . More to come. This is bloomberg. That is 10 29 in hong kong and singapore. Here are the first word headlines. President trump used his july 4 addressed to champions handling of the coronavirus pandemic, even as infections continue to rise. U. S. Cases rose by more than 34,000 on sunday to 2. 8 million, with fatalities approaching 130,000. On the global radar, mexico overtook france to become number the viewex, while ho reported a oneday high for new infections on saturday. Reversalces a further with the u. K. Government said to phase it out of the 5g network. We are told a new report says american sanctions meanwhile way would have to use means hw awei would make it impossible to control. Officials are drawing a plan to accelerate the removal of existing components, although a timetable is yet to be confirmed. The European Finance industry is ramping up pressure on brussels to increase access to markets, warning of a no deal. Derivative clearinghouses would have to start closing for the u. K. Three months may already not be long enough. The border between australias most populous states will close wednesday as coronavirus cases spike in melbourne. New south wales and victoria have resisted shutting the border in the first stages of the pandemic to avoid stoking economic disruptions. However, resurgence in infections have led to a locked down 12 areas of victoria and prompted a wider rethink. And one of americas biggest utilities is turning its back on natural gas. Dominion says it is selling stuff its pipeline to Berkshire Hathaway for 4 billion, with Warren Buffetts investments assuming another 5. 7 billion it dollars in debt. Dominion and its partner duke energy are closing the pipeline, citing costs. Lets do a quick check on the markets again. China markets very much in focus, but it is a global story we are seeing in the region with this risk rally continuing on monday morning. We are close up to 1 on the mci asia pacific. He are seeing u. S. Futures up by 0. 3 , nifty futures pointing to a positive open today as well. Story isr weakness propelling things higher today. Lets see what else we are looking at. The Australian Dollar also. It should not be overshadowed right now by what we have seen in the virus cases in the u. S. There is some improvement helping to offset the negative news in australia, with parts of melbourne under lockdown. The kiwi heading higher by 0. 25 . The strength in the rupee and taiwanese dollar as well. We are watching bonds. We have money going to stocks and out of sovereigns here with the u. S. 10 year yield up two basis points. The australian 10 year up three basis points, now that yields are getting ready for the bond issuance. The chinese 10 year yield, 2. 96, the highest we have seen since january of this year. Brent crude extending those gains we have seen. It seems like we are hovering around the 43 mark for brent. Lets take a look at these Chinese Markets once again. Withntioned the 3 gain the large caps in china. Inc. , with reports saying shareholders have voted to oust the chairman. The beijing court has also frozen his entire stake in car inc. s Parent Company as well. Of optimism onot brokerages, given what we have seen in this risk rally in chinese stocks. They were denying some rumors that a merger was in place with one of its big rivals. Surging 10 . South korea did confirm 51 more cases, although it seems like investors are willing to take that to think that mobile gaming growth is still strong. Halinda quite a day in the markets, 40 up from march lows. President trump has yet to sign legislation imposing sanctions on chinese officials over hong kong, but the administration is considering two or three actions with a high chance something could be unveiled soon. Now. Eporter joins us what is the latest . Reporter u. S. Lawmakers are increasingly looking to pressure beijing. Tole donald trump has yet sign legislation that could impose sanctions over hong kong, other moves are possible before long. Administration officials saying this weekend that trump is considering two or three actions against china. There is a high probability that could be unveiled within days, although they did not provide details. The timing is significant, as they got final approval for the hong kong autonomy act. It was signed unanimously by the u. S. House. Trump at this point could sign or veto the bill. The white house has not given a signal either way, but he did say last week he is getting angrier at china. This is legislation that has been a high priority for members of all parties. They have been joining forces to pressure the government on beijing, both on trade and now on human rights. Have seen other western nations also respond. We heard from the Prime Minister justin trudeau. Canadaspending extradition treaty with hong kong. What is the significance with this move . Reporter tensions are ramping up between canada and china. For domain canada trudeau the first twocanada remove links. Is a travel advisory warning about the impacts of the law, and that is significant because there are 300,000 canadians living here. He says he will look at additional measures, including around immigration. All this coming over tensions of the detention of a huawei director and the holding of two canadians. Those are cases that have been closely linked and worked to make the ties between them increasingly fraught. Our china government editor is there with the latest. A world first from Hyundai Motor. They are shipping their first order of fuel cellbased heavy duty trucks. We take a closer look at the Game Changing move next. Hyundai motor has announced it is shipping 10 of the worlds first fuelcell heavy duty trucks to switzerland. It will roll out 50 trucks this and 1600 units by 2025. Despite the challenges of bringing the cost down and limited infrastructure, the potential advantages of fuel cells over batteries has drawn growing interest in fuelcell vehicles deployment. Joining us is saehoon kim, Hyundai Motor group senior vp and head of fuelcell center. Thank you so much for joining us. For decades, we have heard about this in the industry, this shift from hydrocarbon to hydrogen. But it has not quite taken flight as expected. Why now, and how does it all fit into hyundais strategy . That we have realized after the pandemic that we have to prepare better for the global warming. With this truck, we want to show the people that the fuelcell is a presentday reality and not for the future. This every month from now on, 10 trucks to switzerland. 2020u said, 1600 units by five. By 2025. Many people are interested in Hydrogen Trucks because in trucks there is no alternative power. Foreries will be too heavy heavy duty trucks above 34 tons. Fuelcell is the right technology for this. Yvonne there are some key oftacles for a full adoption fuel cells, one being the high cost of ownership. And then there is the inefficient refueling structures. How do you overcome those . Guest it is certainly a problem. We have already massproduced passenger cars in korea, and we have deployed 9000 fuelcell passenger cars, but we are Building Infrastructure we are lacking infrastructure, it is clear. For trucks, i think we can control the hydrogen station even better than passenger cars. By developing fuelcell trucks for the first time in this area, we found many technologies to improve also. But i think as you said, the most important thing is the Hydrogen Infrastructure for refueling. Thently, we have heard announcement of German National hydrogen rollbacks, and we are waiting for the eu. I think we will get better much sooner than we expected. Halinda quantify that for us. As long as the cost remains high, it is hard to get to mass market. When do you see that happening . Sayt well, many people Fuelcell Technology is expensive, but that is in the past. People are talking about technology 10 years ago. Now we have increased usage significantly. First fuelcell vehicle in 2013, which was the worlds first fuelcell vehicle. And the cost by our secondgeneration, we had reduced the cost in half. System next generation will be halved again. An average, every six years the cost is cutting in half. Withis in the same line toyotas announcement as well. I think when we get to critical for, like our target production in 2025 is about 10,000 vehicles per year, we will go to the Critical Mass of Cost Reduction. Eeevs arettery already challenging fossil fuel cars in some markets like the u. K. Where do you see the biggest demand for Hydrogen Cell technology . Future, if you go to the Renewable Energy society, there is only several ways you can use the energy. Of course, you can use solar, sunshine directly, but we have to store it and use it in the later time. One way is using a battery. But the battery will not hold for a long time. It with seasonal change, and you want to store a large amount, making the for hydrogen is the best way to store it and use it. I think people are starting to realize the potential of hydrogen now. Yvonne just to followup on demand,s question on the fuelcell industry so far has been heavily reliant on government subsidies. I take a nation like china that that itned the hard way is almost a bad thing to be too reliant on government intervention. What happens to demand if these subsidies are constrained . Our target is not to use the government subsidy in the future, of course. But you have to remember, every someechnology needs subsidies from the government because the cost is very high. Compared to the Battery Industry, the battery has been and has a large amount been massproduced already through cell. And batteries free desk and batteries for your desktops. Batteries already have a long history. But fuelcell compared to that is a very new industry, and there are not many countries taking that right now. The speed of the Cost Reduction compared to the factory compared to the battery, it is very fast. I am sure our target internally is to come to the comparable cost of battery electric vehicles by 2025. The target is quite challenging and we know the Battery Industry i reducing the cost also, but think we have hope on that. We can rely on that result. We have talked to automakers who have been hit by this coronavirus outbreak. Has the pandemic impacted your production targets . Are you reaching those targets . Guest no, no. I think there is no impact in korea. Only that hyundai will not only put our fuelcell system in hyundai vehicles, we are trying to provide our technology to other companies and other truck makers or bus makers. Because of the impact in europe and china, it is very difficult to have good contact with them. I thinker the pandemic, the hydrogen industry, we will have a Better Business in the fuelcell area. Halinda how about in terms of other sectors . Do you see other sectors adopting the technology . You have to cooperate with other companies that will be impacted. But i think as far as in the Fuelcell Technology, hyundai has our own technology and we are improving. Our supply chain is about 95 in korea. We are not so much damaged, i can say. Halinda [laughter] thank you so much for your insight. That was an exclusive interview with saehoon kim, Hyundai Motor group head of fuelcell center and vp. Still to come, the Dutch Central Bank governor tells us why he thinks european economies should not lean too heavily on Monetary Policy. Stay tuned for that interview. This is bloomberg. The Dutch Central Bank governor klaas knot says europe should not lean heavily on Monetary Policy as the main line of defense against coronavirus fallout, and there is risk of an uneven recovery across the euro area. He spoke at our webinar. Guest clearly if left unattended, there will be asymmetry in the recovery. Fiscal packages and fiscal space has been asymmetrical, so the physical response has been more forceful and more immediate in some countries than in others. There is also the difference in economic structure. Some countries are more dependent on things like tourism, which has taken an immediate hit. Differences in economic causedre also have a symmetric consequence, asymmetric shock. The amount of flexibility, that is the point where i personally believe the dutch economy why the dutch economy is doing well, because we have a high degree of adaptability built into our economic structures. So yes, if left unattended, there will be heterogeneity. That is also why i think there should be an areawide fiscal response to try to compensate for some of these differences. Reporter we have had a couple questions on inflation and deflation. This is the debate going on. One person pointing out that you in the past indicated the velocity of money supply is an indicator of Inflation Expectations and future expectations. The nominal money supply growth has been very high. A lot of that is precautions. Whether the velocity has sped up or not, i could not really say. But there are also separate questions, saying what is the risk of japan style deflation scenarios, or something close to deflation . Japanification is the word. Where do you come down on those scenarios . Guest it is interesting that most scenarios are being debated. Are warning for even lower inflation then we have had in the past five or six years. There are schools of economies that say undoing some of these benefits, all the monetary stimulus is there now in terms of excess liquidity, two point 7 trillion in the euro area, at some point the genie should be out of the bottle and not to hire inflationary scenarios. It is hard to say. Personally, i think that in the shortterm clearly the disinflationary effect of the willne in aggregate demand culminate, but should it take us into deflationary territory, i am not convinced. Deflation for me is not just a few months with negative inflation rates. To me, it is about deflationary spirals, where the negative rates lead to as postponing lead to a postponing on uncertainty. We have not seen that, not in 2015, even though there were inflation rates that came down significantly and there were a couple months with negative rates. But core inflation, i would say is, relatively speaking in the euro area, even in 2015 it never fell below 6. 7. We are now slightly below one. Worriedmoment, i am not about core inflation that would enter into deflationary territory. At the same time, i also have difficulty believing in the extreme inflationary scenarios. They may become relevant in a few years time when the negative supply factors become more relevant, but for the shortterm, the first two years or so, i think the forces of corona will be deflationary rather than inflationary. That was Dutch Central Bank governor klaas knot speaking at bloombergs eu policy series webinar. Lets take a look at the headlines. Rivalolders of starbucks has turned out a chairman days after he survived an attempt by directors to strip him of control. Three other directors will follow him out after an extra ordinary meeting in beijing. London is in a major shakeup after senior figures okd the numbers. Chip manufacturer is looking to raise just over 6. 5 billion dollars in shanghai share sales. It is aimed at helping the company compete internationally as the u. S. Tightens restrictions on the sale of technology to the mainland. Shares have soared almost 180 in hong kong this year. The hang seng today flying on the prospect of the ipo in shanghai. You take a look at the broader picture. U. S. Futures are also up and extending gains, up 0. 8 . Thendout is the msci csi 300. We are inching closer to that benchmark. We saw strong commentary from state media saying fostering a healthy bull market after this epidemic is now more important for the economy than ever. Take a look at what you are seeing. You basically see asia fx gaining today. Dollariah, the taiwan gaining come along with the aussie dollar. The japanese yen is retreating. We look at other assets, and it is yields taking higher. Thailand is closed for a holiday as well. Your chinese 10 year yield up six basis points, back to levels we saw at the beginning of this year. Brent crude also adding to those gains, 42. 94 right now. Copper headed in the opposite direction. Halinda plenty more to come. In the next hour, stay with us. This is bloomberg. You doing okay . 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. Haslinda its almost 11 00 a. M. In singapore and hong kong. Im haslinda amin. Welcome to Bloomberg Markets asia. Rishaad im rishaad salamat. Better Economic Data with worries about the coronavirus. Chinese stocks building on a fiveyear high. Haslinda the pandemic continues to surge in the u. S. And beyond. The World Health Organization reports 01day high a oneday high for global new infections. Rishaad new delhi is ramping up tensions with beijing, saying it will no longer import Power Equipment from china. We will be joined by a veteran indian diplomat who says crossborder relations will only get worse. Getting straight to the markets. Having a look at the up arrow stories. The fourth of july weekend. Lets check in on some of these. Having a look at the nifty. It gets on stream in just about 45 minutes from now. Nifty managed to close out the friday session up by about 0. 5 . Good activity. S p futures on the up as well. Gains, broadbased in this part of the world. Lets kick it out to some of the individual indices. 3. 7 to the comp, upside. Hang seng, shares driving the rally, put on 628 points. Gains are more modest for the kospi and the asx 100 in sydney. People are concerned about a second wave of the pandemic as victoria state closes its border with New South Wales after the biggest surge in virus detection since the whole crisis began. Quickly, the currencies. Looking at the bloomberg dollar index, down by about 0. 2 . The yen trading about 0. 1 to the downside. The euro and the aussie. Cant quite make it through that. Haslinda . Rish,da well, investors are weighing betterthanexpected Economic Data against a surge in coronavirus infections. The World Health Organization reported a oneday high in global infections. The imf is projecting a deeper global recession with the contraction seen deepening to almost 5 . Goldman sachs underscored the issue by lowering its forecast for u. S. Gdp this quarter. Lets bring in johan jooste. Johan, good to have you with us. We talk about how global stocks are up 40 from march lows. Where do we go from here . Where will they be in six months . Look into the crystal ball for us. Johan thats a curveball. I think we are going to struggle to reach the levels we had before the whole thing kicked off. Weve probably made back all of the losses. If you think back to what valuations were looking like you spoke about the gdp downgrades. They are getting a little bit more downgraded. You are starting to make a case for continued rally. The only thing that would be supportive, and it has been enormously supportive so far, is the amount of liquidity and intervention from the policy side. That has been the saving grace. Wave or aave a second continued surge in the first wave of infection, you have the maybemakers step up, then the market keeps moving. Failing that, i would say theres a period of consolidation ahead of us. Haslinda when you take a look at the chinese stocks, they are going gangbusters today, up almost 4 . There do you see those gains sustaining . Can china build on those gains . Johan the chinese economy is in a vastly different position from some of the other countries, and thats because they managed to get control of the infection early game early. Thats actually quite different. The chinese economy didnt get out of it that fast. You would think on his relative basis a relative basis china, asia will it stay at that kind of level . You are pushing your luck a bit. But relatively, asia seems better positioned. Haslinda whats the risk in the markets . How has it been priced in . A biden presidency more likely now. Johan its a bit early to start pricing that in. Biden hasnt shook his hand yet. His best hasnt showed his hand yet. His best strategy is to leave the incumbent to say things. With not forced to come up anything particularly groundbreaking. He is a bit of an unknown from that point of view. If the president does badly enough and loses control and gets the republicans to lose control of both houses and the white house, then its really up in the air, because then you could essentially spend four years shaping things to your devices. Its a bit early to price in the biden presidency. A lot of whats happened already in the context of the support thats been given to the u. S. Economy, you wouldnt think that change is by much. Maybe a tweak here and there. Certainly, that was part of the democratic agenda also. But apart from that, i think its still a little too far out into opaque far out and too opaque to price what hes going to do. Rishaad johan, lets have a look at the economy, because a lot will be contingent on whats happened with the number of people out of work. On thursdayjobs was much better than expected. I want to draw attention to one anomaly. Historically, the number of people who are unemployed is roughly three times those of the continuing claims. This time, claims exceed the number of people unemployed. Theres more people claiming benefits than unemployed. Whats the real data . Johan well, good question. I think part of it is there are massive challenges for just actually collating numbers of this magnitude. These are working from home theres programs going on, you can claim this and that. Theres a certain element of smog to these numbers. You need maybe a month or so to be clear about precisely whats going on before you draw conclusions that are either too pessimistic or too optimistic. You also need to look with some at the average earnings and so forth. Take a step back and say, listen, maybe these things are just a little bit anomalous. Lets wait for it to settle. Somes bound to be revisions going on. Rishaad johan, what weve got at the moment is certainly a rebound taking place as it states and countries open up, but this is bound to happen. But our people looking at this as a recovery rather than a rebound but are people looking at this as a recovery rather than a rebound . Johan if you mean, where are we in terms of growth now versus growth before, you are right, it is a rebound. Why forecasts are still pretty grim. A lot of capacity has been taken out. It will take a while. You have to position for a little bit longer term. The next couple months, probably your question about the labor data, that applies to a lot of other pieces of data coming in, which is extremely difficult to interpret. You now want to make forecasts, then its even harder. Probably not the best thing to get too despondent or too optimistic. Play that trite modern statement of as broadly as you can. There are some trends you can begin to discern. The strength of Balance Sheets. Certain industries. As a rule, what we are trying to do is stay defensive, not overpush. Rishaad very quickly, weve got a question of the day from our mliv team. It goes to the data we are talking about. Sorry to keep on about it. Are markets struggling off of data improvement . Are they . Johan no, i dont think so. It is priced in. If you look at the speed in which things were covered, it pretty much priced in a lot of itwhich things recovered, pretty much priced in a lot of good news. I dont think the market is shrugging off the good news. The market is sort of saying i told you so. Now we wait for the next batch. Oflinda johan jooste, m. D. Global cio office. Underweight equities. Lets get the first word headlines. President trump used his july 4 address to champion his handling of the coronavirus pandemic, even as infections continue to rise. U. S. Cases rose by more than 34,000 on sunday to 2. 8 million. Mexico overtook france to become number five indepths in dea ths. The World Health Organization reported a record oneday high for new infections on saturday. One of americas biggest utilities is turning its back on natural gas, selling to Berkshire Hathaway. Investmentetts outfit assuming billions in debt. They are killing the controversial Atlantic Kospi gas pipeline coast gas pipeline. Tokyos governor has been reelected for a second term in a landslide victory as the city deals with a surge in coronavirus cases and retains hopes of hosting the olympics next year. She took about 60 of the vote. Koike campaigned on her handling of the virus, shunning public rallies and opting to address voters online. Australias finance minister says he will step down in the coming months, even as the country suffers its first recession in 29 years. 2013,een on the job since under three different Prime Ministers. He still has to deliver an economic statement and the budget in october, as well as a budget update in december, before he leaves. There may be a major shakeup with kanye west saying he is coming on board. Its not clear if he is serious, but social media exploded after he tweeted his intention to challenge President Trump and joe biden. Kanye has almost 30 million followers on twitter. A bloomberg review suggests he is yet to file the relevant forms. Rishaad still ahead, ties between china and india continue to worsen. We will speak with the former ambassador to china, gautam bambawale. Jinping ashes for xi the United States and canada take action on different fronts. This is bloomberg. Got a formere European CentralBank Executive board member saying that he is cautious on the speed of the economic recovery as the coronavirus cases continue to rise. He is telling people what he thinks Central Banks should actually be doing. Central banks have to do a lot to face this crisis, as the crisis is not over, as we just heard. Cases are up, depending on the region. Central banks will have to continue facing uncertainty and face uncertainty. The more they do it, the more they have to invent new instruments. They have to be mindful. Yeah. Do you actually see that readjusting at any point, or will they be more likely to cross that line you say they are getting closer to . It has readjusted, actually. If you take europe as an example, what we see is a strong fictional action fiscal action. See a plan to use common resources, coordinated resources and common spending, common debt. Fiscal policy is waking up to the challenge and thats really good news. Benoit, i want to lean on your expertise, from being former executive board member at the ecb, because i spoke to a guest earlier who said we wont see positive Interest Rates in europe, a fundamentally steeper curve or ecb Balance Sheet reductions this side of 2025. Do you find that problematic . Thats certainly what markets are telling us. Said, it depends a lot on the way the european economy steps out of this crisis, which is honestly very hard to tell. It is a likely scenario. The return on capital can go back. Ultimately, the ecb can the key is about lifting productivity. The french government is looking at ways to extend crisis measures, where the long term furlough, turning loan guarantees into partial equity. Earlier, we were talk about crisis measures. What are the risks of governments prolonging Emergency Support in france and elsewhere . Benoit its a transition. I think in europe, the most acute phase of the crisis is behind us. We dont see signs of the crisis coming back, the virus coming back to the extent that it for instance. So, what government has to do is continue the transition to something more sustainable. From liquidity issues to solvency issues. We have severe solvency issues. Instruments have to address that. Rishaad former ecb board member benewah benoit coeure. The most in 16 months, a stellar gain for shanghai and shenzhen stocks. There you go, haslinda. Haslinda the hang seng is in bull market territory, climbing 20 from its march low. Going gangbusters in north asia. The u. S. May be set to increase pressure on beijing. An Administration Official told reporters that President Trump is considering additional actions against china that could be unveiled soon. Lets cross to selina wang for more on that. What additional measures is that administration considering against china, and what about other countries . Selina weve learned the Trump Administration is considering two or three actions against china and these could be unveiled in the coming days, rather than weeks, according to an Administration Official who declined to provide any details on what these additional actions could be. This comes shortly after the u. S. Congress had approved a bill that would sanction chinese officials and businesses that are involved in cracking down on dissent in hong kong. That bill would also require the u. S. State department to give an annual report to congress, which would identify which officials are involved in undermining the model,untry, twosystems and it would give President Trump the power to seize the assets of those individuals. Even though there has been strong bipartisan support for this bill, the white house has yet to give any indication as to whether or not trump is going to sign or veto the bill. Beijing has asserted no amount of external pressure will deter china. If the u. S. Moves ahead, china would take strong countermeasures, with all the consequences born by the u. S. Side. Trudeaunister justin announced that canada will be suspending its extradition treaty with hong kong. Hong kong does have 30 extradition treaties with 30 Different Countries and jurisdictions. In addition to that, canada will be suspending exports of sensitive military technology to hong kong. Beijings Foreign Policy has become rather more aggressive of late. We have countries hitting back. The u. K. Could be preparing to phase out huawei from its 5g network. What do we know about this . Where are we with this . Selina in addition to escalating chinau. S. , chinau. K. Tensions, you have china and canada tensions heating up, especially since the arrest of huaweis cfo. Officials are preparing plans to stop installation of new huawei equipment in the u. K. 5g network, as well as removal of existing technology. According to a person familiar, a report concluded that new u. S. Sanctions mean that huawei would have to rely on untrusted technologies, meaning that security risks would be possible. If the u. K. Moves ahead with this plan, this would be a sharp reversal from what Boris Johnsons administration had signaled earlier this year, when they said that while way would be allowed in the u. K. That huawei would be allowed in the u. K. 5g rollout, as long as conditions were met. The u. K. Had argued that it could mitigate security risks while still allowing the u. K. To benefit from while way from huaweis technology advancements. Huawei has said it is working with partners to try and find ways of managing these proposed u. S. Sanctions to allow the u. K. Just domain its lead in 5g, saying these u. S. Restrictions are more about marketing position market positioning, rather than National Security. Haslinda our china correspondent, selina wang, in beijing. Lets do a check on the Chinese Markets as they had to break. Chinas csi 300 index is jumping right now, more than 4 , rising for a fifth straight day. It is at a 52week high. Perhaps it has gone too far, too fast. Fome could be more gains or o, fear of missing out. Hanghai comp up by as much the other indexes in china also doing well. Hong kong is up for a fourth day. The hang seng is in bull market territory, 20 from its march lows. We are keeping an eye on the Chinese Markets. Goldmans u. S. Tensions wont hurt china stocks too much. This is bloomberg. Withad you are back Bloomberg Markets. The latest business flash headlines. Denying they have held talks about a possible merger. This comes after reports that chinas two biggest investment banks were applying to create a powerhouse. Coffee. F luckin three directors will follow the chairman out after an extraordinary meeting in beijing. Haslinda lets take a look at the Chinese Markets. Yields are on track for the highest levels since january. Lawmakers have been walking a tight rope between countering and another debt bubble from the latest spending spree. Stay with us. This is bloomberg. Haslinda its almost 11 30 a. M. In singapore. We are in the middle of the trading day. It is a riskon day in all of asia, almost. Its fake newsking law. Falsehoods regarding its testing of migrant workers. Singapore is set for its election day on friday, july 10. The pandemic has become among the election issues. The sci is up by 0. 6 . A look at where we are in terms of those markets. Its a riskon day in asia. Markets going strong this monday with most benchmarks up by more than 1 . The nikkei is higher by 1. 4 . The hang seng is higher by 2. 7 . Territory,ll market up by 20 from its march lows. Inase watching smic, ch top homegrown chipmaker, seeking to raise at least 6. 5 billion in shanghai in that ipo, which could help it compete against its global counterparts. Exe asked asked asx 200 ind is higher. A feelgood monday today. Now, lets get the first word headlines. The European Central bank is warning the euro zone faces about two years of downward pressure on prices, but could see a turnaround after that as the covid19 crisis transforms the economy. The ecb president , Christine Lagarde, says she expects the period of disinflation to begin inflation andd by the possibility of higher rates. [speaking french] translator disinflation to begin with, then inflation we have to anticipate and measure, but it will be most likely based on an increase natural increase in Interest Rates. Haslinda Goldman Sachs is lowering its forecast for the u. S. Economy this quarter, but still expects a rebound in september. Consumer spending may stall, but other countries have proved it is possible to resume activity post virus. The bank says the u. S. Will grow 25 in the third quarter, having previously predicted 33 . Border between australias two most populous state will close wednesday as coronavirus cases spike in melbourne. New south wales and victoria had resisted shutting the border to avoid stoking economic disruption. However, 12 areas of victoria have been locked down. Finance ministry is ramping up pressure on brussels to ensure postbrexit access to london markets, pointing out major upheaval if there is no deal by the end of september. Thats when u. K. Derivatives clearing houses would need to start closing the membership of eu firms. Three months may already not be long enough. India says itll no longer permit imports of Power Equipment from china for reasons of National Security. This adds to simmering tension between new delhi and beijing after a Deadly Border clash in the himalayas. Ia says its time now to stand up. Gautam bambawale is a former indian ambassador to china and pakistan. Welcome to the program. I believe you think this whole reset should take place, but, ultimately, relations will get worse before they get better. Its up to the two sides to decide the rapprochement. Gautam let me first focus on why the relationship is where it is today. Undefinedhere is an boundary between india and china. One of the prerequisites for the rest of the relationship to move forward is to ensure that there is peace and tranquility on the border. Now, earlier this summer, in early may, the chinese pla moved huge numbers of troops to what is called the western sector of the indiachina border areas, almost 3, 3. 5 divisions of pla troops. Therefore there has been tension along the entire indiachina frontier. Thatoint is simple, rish, if you do not maintain peace and tranquility on the border, then the rest of the relationship cannot proceed as it has over the past 25 years. India hasesult, indicated its displeasure by apps,banning 59 chinese including the one which was very well known in india, and now banning Power Equipment from china. Rishaad ultimately, doesnt this move, then, or tensionsthese or these tensions force india into the camp of the americans, australians, and the japanese, and in effect create almost a cold war, because india itself is created by ones aligned with china . Gautam what you said is absolutely true. Therefore many of us who have worked with china over so many decades just dont understand it. Because by this military move on the ground, what the chinese have successfully done is pushed thea into the arms of United States. And we will definitely strengthen our partnerships, not just with the u. S. , but also with japan, with australia, with countries like indonesia. And, you know, we will strengthen our partnerships not just in a political or military sense, but also economic sense. So, i think that, to us, in india, we just dont understand what is the motivation for china to disturb the peace on the boundary, but the piece has been disturbed for the first time in over 45 years. Soldiers on both sides, both indian soldiers and chinese soldiers, have died on the frontiers between india and china. And therefore, you know, if we cannot have peace on the border, then india is forced into taking steps which will reduce the relationship, which will deteriorate the relationship. As you said earlier, i see things getting worse before they can get better. Rishaad ambassador, also, india prospect, a terrible and that would be a conflict on two fronts. Im talking lets not forget their other border, toward the east, the border near tibet and nepal. Lets not forget that theres the dispute in cashmere with pakistan kashmir with pakistan. How worried are you about a militarized conflict . Beenm look, we have talking with china ever since this crisis started in early may. We have had both talks at the military level, as well as through diplomatic channels, and we are hoping that better sense prevails, because, as our Prime Minister mr. Modi said a few days ago, this is a time of development. Economic development should be the focus of all countries, not territorial expansionism. So, we as a diplomat, i hope better sense prevails. But of course, if push comes to shove, india is prepared for a twofront conflict and our armed forces are ready for the worst. From a Strong Military posture, we do hope that diplomacy will prevail. Ambassador, you talked about how india is wondering the motivation behind chinas move against india. Ise say that perhaps china paranoid about what Indian Home Affairs minister shah said about reclaiming what are your thoughts on that . Gautam i think the main motivation is chinas aggressiveness all around. You have seen chinas aggressiveness in putting in the new National Security law in hong kong. China has been very aggressive in the South China Sea and it has led to the United States sending two or three battle carrier battle groups into the South China Sea. I think its the same aggressiveness we are seeing on the indiachina border. Thats an important contributing factor, but i do hope that better sense will prevail, because we would like to settle this quietly through negotiations and diplomacy. Time, whereame territorial integrity is concerned, as you can understand and your listeners would understand, your viewers would understand, there can be no give. I do hope better sense prevails. Haslinda quiet diplomacy has not worked. You say, when push comes to shove, india is willing to go all out. What are the options then, between quiet diplomacy and going all out and taking on china . There is a whole series of options. As i said earlier, india has indicated its resolve not just on the ground through its military, but we have also told china or signaled to china that the rest of the relationship cannot remain as it is. The vast amounts of trade and investment which do exist between india and china cannot go ahead if the border is not peaceful. I am expecting a few more measures of this kind to signal to china that india will not stand for chinese hegemony and will not stand for chinese bullying. One of those measures is likely to be that chinese firms may be manned from indias 5g trials and rollout, just as the u. K. Has done quite recently. I think that could be a very important haslinda such a move would come at a cost. Gautam yes, absolutely. We expect china to retaliate. It would come at a cost. There would be pain for both india and china. Therefore, i keep repeating that i do hope that better sense prevails and that diplomacy can sort out whatever problems there are. An escalationith how do yousador, ultimately take the pressure release the pressure out of all this . Because both countries would rather actually deal with it themselves. Perhaps external mediation is needed. Do you think that would be allowed by either beijing or delhi . Gautam you are absolutely right. Both india and china have said very clearly that we do not want any mediation. There are talks going on even as we speak both between our militaries on the ground as well as through diplomatic channels. The immediate need is to reduce the number of troops which have been built up by both sides close to what is defined, what is called the line of actual control between india and china. I think thats something that both sides are looking forward to. Both sides have repeated they will try to result resolve this through talks. Soon,do hope that happens because when soldiers from two militaries are in close proximity to each other, there could be incidents, like that which happened on june 15, where scores of soldiers on both india and chinese sides lost their lives. I do hope that better sense prevails. Haslinda dotcom bubble well, former gautam bambawale, former ambassador from india to china and pakistan. Not a great start to the week in terms of coronavirus numbers. The who over boards who reports that several countries reported their deadliest day. This is bloomberg. Bloomberg. Just heading over to the indian market. We do have price discovery there. Up 1. 1 . , nifty, sensex is higher. Shrugging off nearly 674,000 virus cases. There we go. Thats the open. Regional euphoria. Banking index is 1. 8 to the upside. Arethats where the markets with regards to india. Lets have a look at what else is happening. We have a broadbased rally taking place. The shanghai composite is closed during its lunch break, 4. 2 up, the biggest gain in about 16 months. The hang seng is in bull market terrain. Haslinda . Rish, the coronavirus continues to make headlines. Global case is approaching 11. 5 million global cases approaching 11. 5 million. Cases in the u. S. , the u. K. , south africa, and japan rise again, while iran and indonesia reported their deadliest days yet. What do some see as the cause of this spike, especially in the u. S. . Theres a lot of discussion about reopenings came too soon that this isnt a second wave yet. The who reported this oneday high in global coronavirus cases over the weekend. Iran and indonesia recorded their deadliest days. There were spikes in australia, india israel, and mexico. Poised to surpass pressure for number three in the world. In the u. S. , cases rose by almost 56,000 since saturday, a 2 rise that outpaced the daily average over the past week, with large increases in california, florida, and arizona. Health experts are saying a key reason for that rise is reopening too soon, people crowding up beaches and indoor most without Wearing Masks or taking appropriate distancing measures. Some states and municipalities are requiring wearing a face mask, but experts say a lot of it came too late. Weve gotodi, singapore at that moment defending its testing of migrant workers. Theyve been using fake news laws, instituted last year, in october. Trying to quell dissent over how the government has been handling the outbreak, if im not mistaken . Jodi thats right. Singapores government has been defending its stand on testing, issuing the socalled corrective directions to statements it didnt like that were put out by Media Outlets and a local club. Is disputingt these statements by the chairman of the singapore democratic party, who spoke friday at an election forum, where he said authorities had actively discouraged testing of migrant workers, among others. With the singapore election said to be held july 10 amid the pandemic which has, infected more than 40,000 people in singapore, the governments response to tackling the virus will be a defining issue in that election. It was praised for earlier containment of the virus, but then the spread among migrant workers, who made up nine in 10 cases, challenge the countrys and have been a source countrys containment efforts have been a source of embarrassment to the government. Ridesharechinas is accelerating towards autonomous cars. This is bloomberg. Chinas largest ridehailing company is making an aggressive push towards self driving vehicles, but the technology is far from being trusted with full autonomy. Aboutke with meng xing how long it will take to replace drivers completely. Has been wayon beyond our expectation. We have very much overloaded wis hlists of people wanting to come over and test the vehicle and have the experience. So, our Operations Team is working daytoday to handle all the requests and having people come in and give them the ride they wish. Safety driver is still required in these driverless cars. At what point do you think a safety driver would not be needed . I think the safety driver today is the Guardian Angel of our system. Roles. Rve very important right now, we are introducing passengers to our testing process, so it is important to uphold the Safety Standards with these safety drivers. We have two today, one looking at the road, taking over the Steering Wheel if necessary, one looking at the system monitor to observe what the computer sees and does not see. Didi faces fierce competition in this market, uber, and others. Didis technology apart from the rest of the pack . What are your advantages and disadvantages . Good question. We have a lot of talent and a lot of Great Companies trying to solve this very difficult problem around the world. And theyve made a lot of progress so far. What i think boils down to the data, howlity and the efficiently you leverage that data to improve your algorithm, and how quickly can you build up a network of vehicles as well as passengers. For didi, we have advantages on both. We have a large fleet of vehicles that, on top of autonomous test vehicles, all of them are gathering road data, and we are leveraging that to improve our algorithm. Ath that said, we have readily Available Network of users on the network. He autonomoust driving running, we can insert those vehicles into our fleet. The passenger will not feel a thing. There will be a seamless transition into that experience. When you look at the industry overall, what is the biggest bottleneck to mass deployment . Is it that Technology Development . Is it regulation . Is it collecting more data . I think its all. Right now problema very difficult because its not a problem only for one party. It has to be a collaborative effort across the technology developer, the service provider, the hardware provider, as well as the regulatory body. We are trying to move this in the same direction together, and hopefully we will be able to solve them around the same time, so that its in parallel, rather than in serial. R d has had an rmd center in Silicon Valley for years. I dont think its a competition. This is a really advanced technology, trying to solve the problem of efficiency and safety for passenger transportation. I dont think anybody should compete on safety. It is a humanity problem that we are trying to improve. , overre observing covid19 and in recent times, that some of our u. S. Counterparts, they are they have some plans, changing the org structure, leaving some of the talent outside. For us, we believe that this is a problem, and its very difficult. We need a Global Talent base to come together to solve this, so we are maintaining our growth in the u. S. Office, as well as our solveoffice, to hope to this problem quicker. Xing, ceo for didis autonomous driving unit. Lets check on north asian markets, going gangbusters today. Risk on in most of asia. Ndonesia currently up 3. 2 the hang seng entering into bull market territory. By about 3. 7 . The csi 300 index continuing its rally, up by more than 4 , up the most in 16 months. It looks like north asian markets are really having a big rally this monday. Rishaad absolutely. The hang seng, bull market terrain. Out of the 50 stocks, just two down. Upving it, though, tencent 50 in that timeframe. Tech tronic industries, and 93 a 93 gain. This is bloomberg. Is a pain program. The following is a paid program. The following is a paid presentation front to you by rare collectibles tv. Guidance is internal. Big Mission Sequence start. 3, 2, 1, zero. We have a lift off