That is a quarter of global infections with california seeing its biggest daily jump yet. When we look at chinas new security law for hong kong and protesters are already changing strategies to steer clear of arrest. First, lets get you a quick check up on how markets are starting this morning. Here is Sophie Kamaruddin in hong kong. Sophie asian stocks are gearing up for modest gains. We are seeing s p eminis moving slightly higher this morning and kiwi stocks are heading for a second day of losses when meridian and another Energy Company leading the climbs on rio tinto deciding to Halt Operations in new zealand. The hong kong dollar staying resilient within one standard deviation as they continue to defend the currency and markets shrug off a threat to the peg. Switching off the board to the terminal chart. We are watching to see if the the best sinceng september 2019. We are keeping an eye to see of chinas market value can top 10 million after pushing beyond nine for the First Time Since 2015 and we are seeing market value continue for mainland stocks, 20 year to date. U. S. Futures are continuing to climb even as coronavirus cases pass the 3 million mark, which represents a quarter of all cases globally. Our next guest sees some upside risk. Is this just a liquidity story at this point . Why do we continue to see the dislocation between Market Sentiment and what is going on with the pandemic and implications for the real economy . I think it is more than just liquidity, to be honest. That is part of the story. There has been a wave of support from Central Banks and it has kept rates very low and it will keep them low for five years, maybe 10 years. That is part of the story but i think it is more than that, we are looking at a situation where theres been a stated desire to not have a complete locked down so we are probably through that total lockdown. That does not mean we will not get some rollback or targeted measures, but we are not having a blanket lockdown again i think. Tot means we will continue see this gradual recovery in Economic Activity that we are seeing in the highfrequency data now, the weekly indicators, the pmis, the labor market. From our perspective, that all points to a grinding but gradual recovery in the global economy, specifically and particularly in the u. S. Economy over the next five years and from our perspective, that is a real tailwind to equities and a tailwind in the sense that returns could be much better than we have seen over the last five years, even something more similar to what we saw in the five years coming out of the gsc where returns were quite strong. Haidi we continue to see tech leading the way. And of course overnight, the story was that the big u. S. Tech is being seen as shielded from the virus downside that we are continuing to watch, but are investors forgetting that when it comes to washington and beijing, what is going on in hong kong, that it is u. S. Big tech that tends to get caught in the crosshairs . Isaac yes, there is some risk of that and some risk that the big focus on tech at the exclusion of Everything Else provides a little bit of Downside Risk at the end of the market. Story and i of the think it is not a new part of the story. We have seen tension between china and the u. S. For all of of9, of course, and part 2018, and the ongoing tension is something that is going to become a new normal for a a while. It does not necessarily mean it will be make or break for text. It is something they will have to cope with, regulatory change, and policy change. Dispel theot possibility of further gains and importantly, the focus on that narrow part of the market, although a very large chair, 20 or so of the index, theres a lot of companies that fell by the wayside and have not yet recovered to reflect that better Economic Outlook. Theres a little bit of positive spin on that, positive upside from the tail of the market that has not really recovered yet to afflict that Economic Growth story. Shery could you apply that framework into chinese equities as well . This gtv chart on the bloomberg just showing how overextended the shanghai composite right now looks. We have seen seven consecutive sessions of gains. The most overbought since 2015. Shenzhen Mission Engine exchange, which is tech heavy, one of the most overbought at the moment. Isaac it is a different market. It really is not the same as the u. S. Chinese equities still have a very significant retail flavor to them and the big sentiment moves and momentum moves and marginal ending moves that help drive that index higher and into bull territory are a particularly already of the Chinese Market. That does not mean to say the rally cannot continue. It certainly can. We have seen that in the past. But we are going to need to see the chinese Economic Outlook pick up if it is going to consolidate those moves and that can happen. We are going to see for the fiscal stimulus from china. It will be targeted, specific to certain areas. We have seen the Monetary Policy stimulus rather than the central bank and that will be targeted. That will allow the Economic Outlook to catch up to the rally. The risk is that we get a big enough dissidents and a crash like we saw in 2016, for example. Shery exactly, that is where i was going because Retail Investors tend to be fickle. Why arent they more scared we could see a similar scenario to what we saw in 2015 when trillions of dollars were wiped out from the market . Isaac it is exactly right and i think the question is when will the music stop . Will it stop before the economy recovers at the moment . The government and the authorities are behind this bull market rally. They are comfortable allowing it to recover and to support and lead the Economic Growth. The onus is on them to deliver and i think if we do not start to see fiscal stimulus, if we do not start to see more monetary stimulus, if we dont start to see more jobs and activity pick up more rapidly in china, that is when the is connect will happen. We see that and we think this rally can be sustained a little bit further, not at this pace. That is not sustainable. What it does not mean it needs to end in an almighty collapse and correction. It could fizzle out and grind higher along with Global Equities over the medium term. Shery we are pushing for the longest rally in two years or so. Thank you. Oole, still ahead, global virus cases are nearing the 12 million mark. We are live to be see as the u. S. Plans to boost testing. Class, the Hong Kong Security law is already instigating selfcensorship, says a Digital Privacy expert. This is bloomberg. Karina you are watching daybreak asia. I am Karina Mitchell with first word headlines. President trumps economic advisers says the administration has a number of issues with china but insists the phase one trade deal is not dead. Larry kudlow says u. S. Companies should think twice about investing in the mainland because of conceived National Security problems. He says the administration is weighing its problems but says it remains closely engaged in the trade deal. Two of americas most famous colleges are seeking a court order to stop the new visa say itsvard and mit designed to pressure institutions to reopen classrooms for in pursuing tuition despite rising virus levels. The colleges won a temporary restraining order. A top United Nations investigator has condemned u. S. Drone killing of Kassem Solemani in january as unlawful. On u. N. Special rapporteur extra be additional killings found washington failed to provide sufficient evidence that the general posed an immediate threat as claimed. She will present her official report in geneva later on thursday. A land sale in hong kong is boosting the citys slowing Property Market. A plot of industrial land in kowloon sold for more than 720 million u. S. Dollars, twice as much as had been estimated. Mainland moneyy could boost hong kongs Property Market as well as equities. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. I am Karina Mitchell. This is bloomberg. The coronavirus has marked another grim milestone in the u. S. With confirmed cases rising 2 in the last day and topping 3 million in total, a quarter of global infections. California reported more than 11,600 new cases, the biggest daily jump so far. The rate of positive cases also rose. For more on the virus, we have michelle cortez. Again, uping a record by 60,000. Is the july 4 holiday playing into this number . Somelle there is potential that we saw a slight decrease in the number of cases because of course people were probably less likely to get tested right around july 4. We had not seen a big decrease in numbers ahead of time and there has not been a really huge surge in the days after so there might have been a slight bump but its not because people were not just getting tested. Its because the number of cases are going up and that is likely to only get worse because it does take a little bit of time for the incubation period and for people to start showing symptoms and get tested so in a week or two, we will probably see cases going up again. Haidi what is the likelihood that we see Elementary Schools, high schools, universities, colleges opening in the fall, and when are we likely to have more guidance on that . Michelle we are not sure at this point how that is going to play out. We are seeing tension between local governors and state officials and the federal government, which of course wants to open universities and Elementary Schools and high schools in order to get everybody back to work. Parents are trying to educate their kids at home. That is a struggle for them. And the of the parent work of a teacher and employee, and we see President Trump is saying universities that do not teach in foreign students, so that is pressuring that as well, but the state officials want to have control. If they are having huge outbreaks, they do not want to be opening schools and putting people at increased risk so we are seeing tension back and forth. We will not get the answer until the end of august or may be the beginning of september. Shery are we still seeing the divergence between sunbelt states that are seeing a spike in cases against some other parts of the country that felt the impact of the coronavirus earlier . Michelle we are seeing the rates continue to rise all across the sunbelt, the south, and we are also seeing increasing numbers in the north as well. New jersey is particularly concerned. Their reproductive member is rising more than one. Every infected person, they are infecting more than one other person. That means the virus is growing. They have been cracking down again. In chicago, minneapolis, idaho, there has not been much of an outbreak. It is unlikely any part of our country is going to be completely safe from this virus. Haidi our health care reporter, michelle cortez, with us. Scientists are arguing over how easy the virus can read through the air. After ruling out airborne transmission, the World Health Organization is not alleging the virus can is acknowledging the virus can be spread that way. Lauren sauer weighed in on that debate. Lauren they are both right. There is a difference between no evidence and evidence that there is not airborne transmission and what we are seeing is that we do not have enough evidence to conclusively say airborne transmission is a major driver. Have someat aerosols element of driving cases, especially in health care setting, and i think what that letter i think was trying to say was that these aerosols may be a bigger driver than what we originally understood, and so, while we are not seeing widespread airborne transmission like in some other viruses, there is a possibility that aerosols are driving more cases than we currently understand. If the virus lingers in the air indoors, it changes everything from School Reopenings to bars and restaurants indoors reopening. Lauren absolutely. The place where we worry the most about these aerosols is a crowded indoor setting with bad ventilation. It is why people are saying that they prefer you to be outside if you are going to congregate, that you want more outdoor space, better ventilation, better airflow, you want to be further apart. And the movement of the air really helps with getting those aerosols out. Not that i would ever think you would darken the door of mary janes at boston university, im sure you did not do that and your friends would not either up at bu, but the kids have to go back to school. Give us some wisdom here of the intractable nature of this from kindergarten up to freshman year at boston university. How do we get the kids back to school . Lauren just yesterday, i think secretary azar said since we do not see many cases of spread in healthcare settings, we can apply those practices to school and get kids back and i think it is just not that easy. I think we need a much more local approach to how we reopen schools. What do the cases look like . What does the spread book like in a local community . Spread look like in a local committee . Do we continue measures to educate people . Do we keep doing online or in places where there is not much spread and we have cases controlled, we can use things like Contact Tracing . Can we put kids and adults back in the classroom . It requires a really local approach. This takes resources. This is an ancient United States thing, for our global audience, the issue of states rights versus federal rights is a third rail across United States history, well over 200 years. How does Johns Hopkins bow be that we should fund the needed funds now that will be utilized in all of eight weeks . Lauren education funds have to be an absolute priority and i think penalizing places because they reopened schools in a different way or because they cannot physically reopen the doors to their schools, alize cornet, and we have to prioritize, especially the children who really, they have to be back in the classroom and we have to look for ways in which we can do that they flee, so Everyone Wants kids to be back. Everybody wants kids to be in an educational setting, but it has to be done safely. It cannot be done unsafely or we will be right back where we started. What should teachers do . We have had a number of tragedies where we lost faculty members at schools, public and private schools. They are of a certain vintage. Did they just not show to teach this year . Lauren i think that older teachers, teachers at higher risk, teachers with multiple comorbidities, they have to have an assessment done with their physician, personal physician. They have to take into account their personal risk and familial risk and then they have to make a decision about what is safe for them. They cannot safely reenter a setting where we do not really understand what the risks are yet. Shery lauren sauer from Johns Hopkins university. The Bloomberg School of Public Health is supported by michael bloomberg, founder of bloomberg lp and bloomberg philanthropy. We will discuss how the virus is affecting business across asia ahead. Aipac chairman and ceo michael joins us for an exclusive interview later. On the, the toll aviation sector, United Airlines, is warning of massive job losses when the payroll support ends. This is bloomberg. Shery in one of the strongest signs of the pandemics impact on airlines, United Airlines is warning 45 of its work force face cuts. Federal payroll aid expires. Su keenan has more on this. This means 36,000 people could lose their jobs. [no audio] haidi all right. We will try and get back to su with the look at u. S. Retail. In the meantime, japanese bankruptcies rebounded in june after falling the most since the 1960s. Sophie kamaruddin is in hong kong with a look at this. Unsurprising that this is the climb where we see that resurgence. Sophie part of this being because of courts reopening and now able to deal with the backlog in cases. The day of reckoning seemingly has arrived for japanese businesses that are failing. The latest tally showed seven hundred 80 filing for bankruptcy in june. That is a 140 8 increase for may and the most number of cases year to date and of that, 94 were pandemic related. Making for a total of 240 for the first half sectors like hotels and restaurants along among the worst hit by the virus. The situation for the struggling companies have been made more complicated by the hold up in government stimulus due to administrative constraints and jumping into the terminal. Firms tapped emergency Credit Facilities and foreign cash, bank loans and deposits have climbed at a record pace in june. Outstanding loans totaled 4. 6 trillion dollars on average in june. That is the highest amount since march of 1999. There is a bit of a Silver Lining to be had in the numbers according to bloomberg economics. When you combine the may and june data, that shows a drop in bankruptcies on a yearly basis thanks to policy support from the government and a boj. Jobr bankruptcies, fewer losses, and potentially less downside for household spending. Bloomberg economics is forecasting a 10 yearly drop when it comes to japanese bankruptcies. Keenanlets return to su. United airlines could be cutting 45 of its workforce. This is a pretty grim picture. Absolutely. United airlines saying it sent out notifications to 36,000 employees. That is almost half of its u. S. Workforce and they are being told their jobs are on the line. Once the federal payroll aid expires at the end of september. The final tally of layoffs could be small as workers offer to leave voluntarily. 3700 workers have done so already. They have taken separation packages. If you look at the stock chart, united is down more than 60 yeartodate. It was down almost 4 on the day before cutting its loss by the close. The company sees 300 million charge from the voluntary separations but other airlines are now expected to follow suit and make similar staffing adjustments. That is the part that many find sobering because the federal government had already provided 25 billion in payroll support plus another 25 billion dollars in loans on top of that and still, we are looking at layoffs. United had said the spike in cases, the quarantines, again, in many states are all jeopardizing their recovery to your normal u. S. Travel. Haidi. Recovery to normal u. S. Travel. Haidi the latest is the famed retailer, brooks brothers, joining that list. Sold suitsbrothers to president s, including abraham lincoln, and now, it is a thing of the past. We are also learning that a retail group which owns the lane bryant brand, these are fixtures at malls across the country, now planning to close at least 1200 stores as that company prepares to file for bankruptcy. Shares are down some 86 yeartodate. They fell 20 on the news today. Bloomberg has learned that it could enter chapter 11 essien is this week. So corporate bankruptcies are showing no signs of slowing down. Yes, retailers are hit the hardest. Back to you. Haidi su keenan with the latest. Coming up on daybreak asia, major u. S. Tech giants putting a pause on hong kong Data Requests. More on the continued fallout from the new National Security law, next. The digital freedoms peloton joins us proprivacy joins us next. This is bloomberg. 49. 50 i found you good job. Now im gonna stay here and you go hide. Watch your favorites from anywhere in the house with the Xfinity Stream app. Free with your xfinity service. Now any room can be a tv room. Stream live tv, on demand shows and movies even your dvr recordings. Download the Xfinity Stream app today to stream the entertainment you love. Xfinity. The future of awesome. Karina you are watching daybreak asia. The coronavirus has marked another grim milestone in the u. S. With confirmed cases rising 2 in the last day and now topping 3 million in total. That is a quarter of global infections. California reported more than 11,600 new cases, the biggest daily jump so far in the states rate of positive cases also rose. The Top Health Official in tulsa says President Trumps Campaign Rally last month likely boosted coronavirus infections. The Health Department director says significant events in the last few weeks have probably contributed to a high number of cases. The president held his rally despite pleas from local authorities, who were already seeing a rise in infection rates. Most of his audience who did not wear a mask. The u. K. Government is gambling money to support jobs and confidence in the virus battered economy. Chancellor sue nack cutting levies on dining out with bonuses for employers who do not fire staff. He says there are profound challenges with the economy contracting 25 in just two months, erasing the growth of the previous 18 years. A majorg is warning of virus resurgence after reporting 19 infections, six of which are of unknown origin. The department of health fear is a major outbreak, saying it is unlikely the sources of the spike will be identified. Five important cases have been reported, bringing total infections to more than 1300. It is the biggest number of local infections since the start of april. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. I am Karina Mitchell. This is bloomberg. Shery. Shery staying on hong kong, the city released details of its new security law this week and it involves unclear curbs on big tech. Companies like facebook, microsoft, and twitter are now pausing Data Requests from the city. For more on the impact from the tech sector in hong kong, lets bring in our next guest, ray walsh. Great to have you with us. Are these tech giants really unjustified here in being worried about the security law . Ray they certainly are because the primary concern relates to the elevated levels of surveillance and businesses face in hong kong can expect to endure. There is no real transference as to what the government may decide. Any action that brings chinas authority punishments are extremely severe and include extradition to mainland trial that could result in life imprisonment. The reality is that the security law is farreaching. It allows china to severely encroach on hong kongs autonomy. The impact that this could have on the tech sector it permits the police to raid hong kong. Data of usersover potentially without a warrant. They can force platforms to censor content in force companies to ban particular users to allow them to get access to data that interests them regarding protesters and citizens breaking the law. To law can even be used prevent suspects from leaving hong kong and there are justifiable concerns that it could potentially be used to stop people who work from Tech Companies from actually leaving hong kong. Shery we have been mostly talking about social media platforms. What about state manufacturers that provide methods to communicate more privately or even Vpn Companies . Now, hong kong has been a very privacy friendly location. Security law now in place, that changes, and Tech Companies may find themselves having to pull out of hong kong to continue with the Current Business model. The security law creates the potential for chinese authorities to demand access to all the data that passes through. That could allow the current minute the government to track what those users are attempting to do in private. That could put people in a tricking tricky position. That, the Chinese Government could complete a crackdown as it has in Mainland China. Vpns beingesult in blocked in hong kong. We have seen tictoc withdrawing its app from the Hong Kong App store, being the first Internet Service to do so in reaction to the new National Security law, given it is used by protesters. Could that be seen as a form of selfcensorship . Is this demonstrative of these Tech Companies being stuck between either operating but within, you know, the confines of whatever beijing wants them to do or just not being in that market altogether . Ray sure. That is the really big question. The problem for hong kong citizens is that actually, while it is good that companies are wanting to show their support for hong kong and its economy, the reality is this could lead to complete blackouts and complete censorship, just like they have in Mainland China so that could have quite the Chilling Effect on hong kong and could leave people without access to these important services. The option may become to either, continue providing those services but with surveillance and with censorship or to actually completely remove themselves from hong kong. Either way, for hong kong citizens, that is very much a loselose kind of situation and it does seem like the start of an extremely slippery slope for hong kong. Has the international reactions, pertaining to the u. S. Starting to roll back these considerations under the special trading status for hong kong, has that reaction been helpful, do you think . Ray i dont think so, no. Could you repeat the question . Haidi i wanted to get your thoughts because i know you have a view as to how the u. S. Announced rolling back hong kongs special trading status and the impact on the export of hightech from the u. S. To hong kong. You do not think that is a terribly useful position to take . Thatthe thing with that is obviously, you know, passing a that stops Financial Institutions and banks from working with any entities that kongsolate hong autonomy, that can actually stopping the exports of tech goods to hong kong, that can have a Chilling Effect on the companies themselves and the people working in them and rather than keeping china the one that is doing the harm here, that can backfire and harm so, iton the ground, and is not necessarily going to work. We need to consider carefully how this does affect hong kong and how we can best support them. Haidi really appreciate your walshith us, to ray joining us for the latest on hong kong. We will get more analysis ahead with Eurasia Group class we will be speaking with the university of hong kongs lecturer later. This is bloomberg. Ourn just two months, economy contracted by 25 . The same amount it grew in the previous 18 years. Property transactions fell by 50 in may. House prices have fallen for the first time in eight years and uncertainty abounds in the market. We need people feeling confident, confident abide, to sell, renovate, move, and improve. That will drive growth. That will create jobs. So to capitalize the Housing Market and boost confidence, i have decided today to cut this. I have decided for the next six food, to cut back on accommodation, and attractions. I want every person in this house and in the country to know that i will never accept unemployment as an unavoidable outcome. We have not done everything we have so far just to step back now and say job done. In truth, the job has only just begun. Layingu. K. Chancellor out his over 37 billion plan to boost the economy. And the ceo of Standard Life aberdeen says he thinks there will be a w shaped recovery in the u. K. Speaking exclusively to francine lacqua, he says we are still in uncharted waters. There are three phases to fiscal policy in dealing with a crisis. First, the initial levels of support. I think that has been done particularly well by the chancellor and also to some extent the Central Banks providing the liquidity. That support inevitably fades at some point and that is where we are, and that is where you need to start putting in place stimulus that reinforces the rebound from the lows in Economic Activity. I think what markets and businesses will be looking for that are measures reinforce the strength of that rebound inactivity and i think, you know, we have seen some pretty good detail that suggests that, you know, either they are doing the right thing, the first stage is about how you sustain that recovery in output. That is about a broader framework where we need to think about the tax incentives, the incentives to invest, the way in which policy maps and with fiscal policy. I doubt whether we are going to hear that today. I suspect that is further down the track so we will be focused on the details to make sure that the rebound in output that is given some additional impetus by the chancellors measures. Whether theseof measures are successful will and 2023 to see if economic momentum will be sustained. If you need to look at markets and what kind of economic recovery we will see, how do you model it out . Keith it is deeply uncertain. In the short run, we are in uncharted waters. What we areink going to see is probably a w shaped recovery and probably a wobbly w at that so we have the initial downdraft in output which is a result of all those measures to protect our health as we return to work, you get a strong bounce in Economic Activity. I think that there is strong evidence that markets have done well because capital and liquidity has been injected and that has found its way into markets and the other thing that has been going on is of course those that can raise additional , hence have done so their chances of survival. The real problem i think is that those that can raise money have and that is not necessarily those that needed to raise money. In my view, i think we are going to see more corporate distress in the second half of the year into early 2021. I think you will see the rise in structural unemployment. Not be surprised even without a second wave of coronavirus, which is impossible to know whether we see a dip in Economic Activity. Was keith speaking exclusively to bloombergs francine lacqua. Very Little Information on covid19 has so far been subject to peer review. Columnist johnon says one piece of research can provide some clarity for market watchers. He joins us now on the line from new york. Confirmation bias has been one of the biggest problems throughout this pandemic in terms of how we make sense of the evidence. What are you looking at and i the mostt is evidencebased way we can look at the risks and artists . Risk scenarios . John the most important point is that we have to maintain humility. It is going to be many years and a lot of hindsight beef where we really are able to work out exactly what has been driving the spread of the pandemic, what has worked, what has not. The first point. Attempting to measure any of the is notith any precision just going to happen. However, the research i recently sent out, which i think was very by the consultancy forecasting consultancy in tried tohich looked produce a regression to look at it coronavirus was yes,ding and found that, significant reductions in mobility, which you do not measure by what governments are saying, but by what google or apple various realtime measures of mobility now tell us about how people are moving around. And reductionses in mobility have a big effect in reducing the spread. Of whatnot explain all has happened since that first initial wave of lockdowns. Diseases spreads slower than more people have had it at any given country or any given american state. Most of the reasons that might explain that are positive. Grasp goingind of a around managing the risks for the future. Shery how does this all play into what we are seeing in the markets . We continue to see this rally and its really focused on some of those huge Tech Companies that have really strong Balance Sheets. The key point about the Tech Companies isnt so much about their Balance Sheets. There is a sense that they offer security. In a covid stricken world. Techof the big names in are not harmed and are arguably even benefited by lockdown conditions and it is obviously nvidia, for netflix, whose market cap overtook intels for the first time today, if you are making lots of chips for gaming consoles and so on. That is obviously not a business arm hit too badly by lockdown conditions so i think that what you are seeing with the latest very big leg up in tech is more i am not sure i think they are as secure as people think they are, but a move for security. At this point, amazingly, given how expensive they are, how exposed they are, how politically unpopular they are, they are seen as offering you a refuge from covid and fear of covid is increasing arguably too much at the moment but that is what i think is driving the Tech Companies. Haidi we are just getting some lines now from tokyo with the city to subsidize nightclubs that closed. These have been driving some of the new clusters of an action there. To thekind of brings me four out of five points you derive from this research. Is this really concerning in the sense that invest is really need to be hedging for the real possibility that these super spreader kind of, you know, environments may not be able to get back to normal . John i think that is a reason for concern. I think you can perfectly well argue that there is a case for taxpayer money to help keep people who do nightclubs or, you know, if you are involved in high culture, that those people can stay economically afloat, that they do not go completely bust while they have to shut their doors, but plainly, one of the reasons why the spreads may have slowed down so much is that there are still minimal super spreader events happening and in the few american states where such events have been allowed to happen, there have been a number of very unpleasant examples involving churches or nightclubs in arizona where they have led to they have led to quite significant outbreaks. So this is one of the possibility of stacked i think needs to be taken into account. Nightmare, total recession in its own right that we are talking about here, but youre talking about the possibility that potential super spreader events just cannot be allowed until, you know, for a long time yet, until a vaccine is available, and that will involve some drag on Economic Growth. It is not a disaster, but plainly, that is a very real possibility at the moment, that we need to be prepared for. I am glad i am not a Single Person in my 20s anymore because that would be very annoying indeed if you were not allowed to go out and meet with people for years into the future. But in general for all of us, obviously, this is not good. None of us likes it. It looks to me as though there should be more attention paid to the real possibility that we are just going to not be allowed to gather in large groups for quite a while into the future. Shery always great having your thoughts, john authers. Breaking news out of japan at the moment. We are getting japan machine orders month on month for may rebound of 1. 7 . This after two months of declines in the machine orders and not to mention that also, analysts were expecting a contraction. Year on year numbers not looking that great. It is a contraction of 16. 3 , but a little bit better than analysts had expected. This of course after seeing the biggest year on year drop since 2009. Perhaps the month on month number coming more positive than expected given that we have seen the state of emergency being lifted. In late may, also recovering in chinas economy, but of course, economies very much watching whats happening with capex and corporate commitments given that japans bankruptcies have also risen about 150 in may. Plenty more to come on daybreak asia. This is bloomberg. Haidi lets get you a quick check of the latest business flash headlines this hour. Airbus has failed to secure any new orders for a third month as the coronavirus pandemic continues to hammer global airlines. It attracted zero interest in june and had one cancellation, bringing total net orders for the year to 298. Airbus has been trying to keep business going by differing orders. It handed 36 aircraft in june and 24 in may and announced plans to cut 15,000 jobs. United airlines is telling thousands of staff that their jobs are at risk after the federal payroll eight expires at the end of september. The final layoff tally has not been finalized and may be smaller. The government provided 25 billion in loans to the struggling aviation industry. The warning indicator facing the sector. One of americas iconic fashion names has fallen victim to the coronavirus. Brooks brothers filed for bankruptcy as the pandemic slashes demand for Business Clothing and its debt becomes unsustainable. The two centuryold companies demise adds to the long list of big names to fall including Neiman Marcus and j. Crew. Brookspter 11 filing let brothers continue while it works on a turnaround plan. Shery coming up on the next hour of daybreak asia, a preview of inflation data due from china with standard chartered, and economist lauren shen joins from beijing to the outlook for airlines in asia rendon joins us later. Seoul,ket opens in sydney, and tokyo are next. This is bloomberg. Shery good evening from bloombergs Global Headquarters in new york. Haidi asias major markets have just opened for trade. Welcome to daybreak asia. Our top stories. Asian stocks set to follow wall street highs. As immunebeing seen to the coronavirus. The pandemic marks and other grim milestone with cases in the u. S. Topping 3 million. California seeing its biggest daily jump yet. The virus is crippling aviation as travel demand collapses. We take a look at the outlook for the sector as airasia joins the list of carriers under pressure. Ifhie as we wait to see chinese dogs will continue the 7day rally, we are seeing little change. The nikkei 225 holding 22,400 points. Jcp is likely to hold ground. Concern eased. The yen, little change. Forecastrs better than as the emergency ended in japan. For south korea, we are waiting on the be oks monthly data on household lending. The kospi gaining ground after a two day decline. To a dump yuan rising a two month high. The worst drop in two weeks for the asx 200. Copper having erased the 2020 loss. A copper deficit this year on chilean supply risk. , rio decided to end spell during options in new zealand. We are keeping an eye on japanese retailers. This after earnings. We are waiting on retail numbers. Get Market Analysis with Mark Cranfield, who is joining us from singapore. Lets get started on the yuan. For the First Time Since march, we are she we are seeing the offshore yuan starting the Asian Session in the six handle. Where we had a . Mark there is probably room for it to had a little lower against the dollar. There is a Good Environment at the moment for the yuan to build on. We have had a little lull between the rhetoric lull in the rhetoric between the u. S. And china. The stock market is spilling over into the currency. We have a good article today on bloomberg. You can read more about how there is a correlation between the direction of the stock market and the yuan. It is a strong level at the moment. You also have the situation where the yuan is a highyield currency. If you look at the differential in the one year right, yields are quite a bit higher. They have remained that way despite the yuan getting a little bit stronger. It is still a highyielding currency. All of those things are working in the yuans favor. It could be that as we get into the middle of the u. S. Election, we could hear more about tariffs. There could be more threats toward china. We probably have a quiet period ahead. That will allow the yuan to drift down. Do not expect the pov the pboc to do daily fixings. They are usually pretty slow to recognize changes in the stock market. They will let the Foreign Exchange move ahead. It could be a few days before the fix moves down. The momentum for a weaker dollar and stronger yuan could go for some time. Nasdaqlooking at the versus china stock, the cs x300 has gains virtually every day except one the last four weeks. It is night and i when it comes to gains in the nasdaq. Are chinese stocks still playing catchup and have a little more potential to run . Mark indeed. My colleague was writing about this. Pe as look at the forward a basis, the nasdaq looks extremely expensive in comparison to several markets including the csi 300 index. The gap is quite extraordinary. There are reasons why tech is driving the rally in america. Lots of demand on the work from home situation. It does make the Chinese Market look fairly undervalued in comparison. There are several other markets such as japanese market, the german market, the dax, and others around the world, which look a little more expensive. On the valuation basis, if you look at the forward pe, china is not that expensive. Thatyou start to weigh against the amount of money china is spending in the tech sector. The Bloomberg Opinion has a good story on that today. Theyre going to spend Something Like 1. 4 trillion over the next few years to boost tech in china. That will help the major companies. That will also help chinese stocks as well. Asn though it might look though the csi is running in parallel to the nasdaq, the outlook is quite a bit better for the nasdaq in the few weeks ahead. Haidi Mark Cranfield their in singapore. You can follow along on our market blog. That is on the bloomberg. Seel ahead, economists chinas inflation easing in june. We will take a preview of the numbers. Plus, are exclusive interview sovereignsias wealth fund. This is bloomberg. Shery breaking news out of mexico. We are seeing the covid19 cases 6995. Y a daily record of taking the total number to 275,000 cases. When it comes to deaths, also 32,796. O this as we continue to see global cases pushing towards 12 million. Lets bring in Karina Mitchell. An update on the virus cases here in the u. S. The coronavirus has marked another grim milestone in the u. S. With confirmed cases rising 2 and topping 3 million in total. That is a quarter of level infections. California reported more than 11,600 new cases. That is the biggest daily jump so far. The states rate of positive cases has risen. The Top Health Official says President Trumps Campaign Rally last month likely boosted coronavirus infections. The Health Director says significant events have probably contributed to a high number of cases. The president held has rally despite pleas from local authorities who were already seeing infection rates rise. Most of his audience did not wear a mask. Melbourne is starting the first day of a new virus locked with restrictions that are feared will deepen and prolong australias first recession in 30 years. The city is now isolated from the rest of the country as the state shut borders. The state has reported more than two weeks of doubledigit infections with 191 new cases on tuesday. Hong kong is warning of a major virus resurgence after recording 19 new infections. Six of which are of unknown origin. The department of health fears a major outbreak, saying it is unlikely sources will be identified. Five reported cases have been reported. It is the biggest number of local infections since the start of april. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Karina Mitchell. This is bloomberg. Haidi chinese inflation data for june due out in the next hour. Bloomberg economics sees it holding steady. Is at theonomist higher end of estimates as she joins us on the line from beijing. What are your expectations . Do we see a recovery when it comes to consumer inflation . In june, partly because across china, supply disruption kid food product supply disruption. We see it as temporary. We expect lower prices in addition [indiscernible] in the rest of the year. [indiscernible] which is significantly lower than the official target. Inflation will stay negative throughout 2020. Haidi when it comes to ppi concerns, are overstated . That the rates continue to weigh on chinas growth. [indiscernible] the major parts including the export of machinery [indiscernible] shery we continue to see the Manufacturing Sector in china rebound while the services, consumption sectors seem to be lagging. What is the risk of having this two track economic recovery . Exactly. A market contraction in q1. We are seeing the pace of recovery [indiscernible] after n is because we see local demand may continue to be backed by the sentiment caused by the virus outbreak. We see a large second outbreak china. The sentimentve will continue to weigh on consumptiom. Consumption. [indiscernible] easing is needed to support the economic recovery. Shery how much will that Recovery Support the chinese yuan . We are seeing a trade of the six handle. A trade at the six handle. It trade at the six handle. To be much lower than previous years. Be theill continue to only major country that supports positive growth this year. [indiscernible] as well as chinas high interest. Ate premium likely to continue to provide support. We expect [indiscernible] sentiment [indiscernible] we are seeing the u. S. China tensions being revived over hong kong. How much does this endanger the phase one trade deal and broadly, the trade relationship . That the u. S. China tensions will continue to be one of the main for the market in the second half of the year. Continue to make in the first month review. Kong hong [indiscernible] we know that will affect reserves. Also, [indiscernible] after the passing of the National Security law. We believe china is likely to step up support for hong kongs status as an economic center. Shery thank you. We will have more on the outlook for china when we are joined by the head of research at vote,. Up,al, global coming Global Buyers cases spike. We will have the details. This is bloomberg. Shery global coronavirus cases near 12 million with deaths above 540,000. The u. S. Just marked another grim milestone with confirmed infections topping 3 million while cases in asia continue to grow. Hong kong officials now fear a major outbreak. Its crossed to our china correspondent. Lets start with hong kong. Concerns therere could be another major locally transmitted outbreak. That is according to health officials. They attribute that because of the number of new cases reported that are a result of unidentified forces. On wednesday, hong kong reported 19 new local cases. It is the highest daily increase since april 1. Of those cases, six are from unknown origins. The rest are from existing clusters, which include restaurants and an hourly home. That compares to the entirety of june in hong kong, there being only about a dozen of new coronavirus cases. This is a stark reminder that even areas that have been praised for an effective virus response, they cannot let their guard down. Hong kong so far has only had seven coronavirus deaths. That is about one Million People one per one Million People in hong kong. This new cases these new cases could further damage the economy, which already shrank 8. 9 in the first quarter. Melbourne is back under stayathome orders. The economic toll be huge given how reliant this economy is on services and tourism. Selina that is correct. This is expected to prolong australias overall recession for the first time in 30 years. A first recession in 30 years. Even though the lockdown only applies to melbourne, it is going to have ripple effects across the state as well as the fact that this state is going to be cut off from the rest of the country as other states close their borders. Victoria contributes to about one quarter of gdp. It is quite significant. Westpacs chief economist expects australias gdp to shrink 2. 4 . This increase is because of new restrictions as well as border closures. Australia had also enjoyed success in its early response to the outbreak as a result of closing its International Border and putting in place aggressive Contact Tracing and testing. A mixture of complacency and mistakes in quarantining International Travelers coming back has resulted in the new resurgence of cases. Are chinaina wang, correspondent our china correspondent going through those cases. Global drugmakers are racing to develop a treatment for covid19. Expects tos his firm start human testing on two vaccines by the end of the year. He says he will not be rushing development at the expense of safety. He spoke with david rubenstein. Toi think our approach coming up with vaccines is we try to make sure we are focused on the on the science. Funding considerations are secondary. We are working on two different vaccines right now. Both of those vaccines have certain things in common. The first of which is we believe they can confer protection with a single dose, which we think is extremely important. Most of these vaccines give the promise of being able to do be deployed broadly. There is never been one vaccine that had to be given to every person on the earth. All 7. 5 billion. The last thing is we wanted to use proven platforms. That is to say, if you think about a vaccine, lets give an analogy. The front end of the vaccine is the protein that stimulates the immune system and gets system against the particular virus, sars cov 2, which causes covid19. That gets plugged into a platform, which is like the hardware. The two platforms we have chosen are platforms that have already been approved by the fda. One is the measles virus platform. Vaccine hasvirus been given to millions of people around the world safely. The second is what we used in our ebola virus vaccine. It was important to be able to work with proven platforms we know are safe and effective and have been used in many people. Messenger rna, which is what is being used by modernity, are you comfortable mo derna are you confident that will work . One of the great things about this situation is there are about 160 different vaccine programs that are pending with different technologies. Messenger rna, some people think that will offer the promise of speed. For us, we want to make sure we have a proven platform and have confidence that a vaccine can be done with one dose. Ck has a lot of experience with an attenuated virus vaccine. That is what we have done before. That is what we know. That is where we went. Some other companies have been given billions of dollars by the federal government. Is that an unfair advantage to somebody like you who has a modest amount . Is that something you are worried about . Care. Ill not say i do not. At the same time, we want to be able to pursue this in a scientifically rigorous orderly way. For us, we think if we are able to come forward with a vaccine and we are confident we will, we think the funding will be there. I do not think it is a disadvantage. When you say you are will there be a vaccine . The end of this year, middle of next year . I will not speak other peoples vaccine programs. We expect to going to human testing with our vaccines, both of them, by the end of the year. The fastest vaccine ever developed was our mumps vaccine and that took four years. The urgency of the situation is going to cause us to move quickly but never at the expense of safety. Mean phaseials, you one, phase two, phase three . What phase are you in now . That is part of the way people are thinking about speeding up the development. For us, we are thinking about going into human trials. Often, you can cause the you can call those phase one if they are to if they are designed right way. Camecame out in some out with some thoughtful guidance. They said they would not approve a vaccine unless there was six months of observation of data. I gives you a sense that the fact is a could be is lets say a year from now. Some companies that are getting muddy from the getting money from the federal government are manufacturing the menu manufacturing a vaccine already. Are you manufacturing the vaccine youre developing . Know, we are scaling up to make hundreds of millions of doses of both vaccines. That is another example of what i mean about trying to compress the time without sacrificing safety. We are going to be prepared. If the data bears out that one or both of these vaccines are useful from a safety and efficacy, from a risk benefit standpoint, we are going to be ready to come forward with hundreds of millions of doses. Merck that was the ceo of speaking to david rubenstein. We will discuss how the virus is affecting businesses across asia. Hotelairman and ceo of a group joins us for an interview later. We will have more on the outlook for the airlines next when we are joined by brandon filby. This is bloomberg. Haidi lets get to sophie in hong kong. Sophie a lackluster thursdays session. Andst gains led by sydney seoul. Funds are under pressure will treasuries are steady. The offshore yuan is staying below seven. Lets take a look at some of the stock movers we have been tracking. Switching out the board to check in on softbank resuming gains at a march 2000 hi. Gh. Sigh claiming a to a high after it filed for a priority review of its alzheimers drug. Digests, the billiondollar buyout offer to make from your mart a whollyowned unit. Speculationsing on the candidate who could replace the operator. Family mart remains on traded with shares shery right. Thank you so much for the latest on that market update. A beijingting coronavirus cases. No new cases for a third day. This according to local media. G beijing isyin recording no new cases for a third day. We continue to see stabilization in the chinese economy when it comes to the outbreak. Already, we are seeing the Global Pandemic taking a toll on the airlines industry. United has warned 36,000 of its workforce that they may be laid off once the u. S. Government assistance runs out. The latest sign of turbulence for an industry rocked by the pandemic. The news comes ahead of Cathay Pacific. Veteranso be is a Airline Analyst and joins us on the line from singapore. Great to have you with us. How bad does the situation look for Airlines Across asia . Badhe situation is quite and has been for the last few months. It is not going to get any better anytime soon. The worst has passed in terms of traffic. In terms of financials, the worst will be in the second quarter. These reports will start coming out the next few weeks. The cash and liquidity is the problem, especially those airlines that have not gotten any support from the government. They need to raise liquidity quickly to survive because the revenues are not sufficient to cover the cost even with recovering domestic markets. That is only a small portion of their normal business with International Traffic still virtually at a halt. It is a little better within europe, within asia, not much recovery yet in international travel. Is the situation financially quite serious. The pressure on airlines will continue to build over the next several years because we are in long crisis. Shery how worse is the situation for an airline like Cathay Pacific that is not have a domestic market . Airlines that do not have are unable tots participate in the initial phase of the recovery, which is entirely domestic. Those airlines are very well positioned in terms of liquidity due to the fact that the governments have come in with big packages for hong kong and singapore and the uae. There is not a concern. Followingines will, the packages they have been able to get from the governments, are sure that they will be able to weather the storm. Airlines that have not secured a liquidity, air asia, they have not secured liquidity yet. They are in the process of it. It caused a trading halt yesterday morning. Is serious. N there the hope is they will raise capital quickly. I think they will, but right now, the situation is serious given their current financial situation and Balance Sheet. Seems bestas positioned out of very poorly positioned airlines given that does have a messy market. Even that, is that coming under threat . The fact that we are seeing victoria under lockdown, we are not going to see that pickup between sydney and melbourne any soon. A lot of domestic markets will have setbacks. It is not a straight curve up. We have seen that in seven markets already in several markets already. Hopefully the market will pick up in china. This is something that is going to be in a lot of markets over the next several months. Qantas, the situation is australia has said no International Traffic for a year, which is an extreme statement. A setback in victoria. The question becomes, will some of the other states open to new zealand . Overall, the situation is quite serious. Qantas is an airline that has been able to raise liquidity and is in strong position. Virgin australia has secured new capital through the administration process. Those two airlines, i am not worried about. The Australian Domestic market will recover. The market is pretty strong compared to some other countries. They actually do have some strength because of the domestic situation and the Balance Sheet. Are you more worried about the likes of airasia . We know Tony Fernandez is working his contacts, trying to get more investment to carry on after the auditors said they had doubts about their ability to continue. It is definitely something to look at closely. I do not think airasia is going to be a concern in terms of surviving overall. They have a very strong brand. They are very close to securing capital. What the auditor said was not surprising. Most investors were not surprised by that because they knew the situation would raise the Balance Sheet and they have not raised new capital yet unlike a lot of other airlines. They have said and continued to state they are close to securing capital through an equity sale, which is going to raise 1. 4 billion ringgit. It is one of seven potential Companies Looking at equity. They have the ability to do a rights issue. I think the focus now is on equity. They are going to take loans. A billion ringgit in loans with half backed by government guarantees. They have been working with the malaysian government for a long time to get the guarantees. Once the guarantees come, it makes it easier. They also have some loans they will be able to take from other countries like the philippines. There is a guarantee that is expected by september. Some of their affiliates can take loans. There will have to be some restructuring. I do not expect all the airlines in the portfolio to survive. There are Nine Airlines letter area that remain. The strongest ones are in malaysia and thailand. There are four other smaller shorthaul, some of which may struggle if they do not get government support. There were three at airasia x. The concern is it could get liquidated. That could be a sensible move that could be pursued soon. The analyst and consultant at sobie aviation. Airasia is considering several options to raise cash. We spoke with the managing director of a rival carrier. We asked if a merger is a possibility. Something that was rolled out last year when they were looking at options. We were looking at the options for Malaysia Airlines. Last year, we were talking to a number of regional and global airlines. Alliances and your partnerships. [indiscernible] between malaysia and japan for instance. Crisis is affecting all airlines. I guess the major challenge now is everybody in this industry is operating under a set of assumptions that nobody knows for sure. There is a lot of difficulty in predicting the changes in consumer behavior. Shared lockdowns ease there is a love even as lockdowns ease. There is a lot of uncertainty. Are you saying that the theible merger between airlines is ou off the table . The main issue at this point in time every airline is more focused on fixing its problems. The industry in general will go through a phase of either cooperation or alliances. [indiscernible] i think that is the future of industry. We will see a lot more alliances. It is something we see in other industries. Like the Health Industry in malaysia. It makes sense sometimes. What support have you been giving Malaysia Airlines to ohether the pandemic tw weather the pandemic . I this point, we are at this point, we are urging them to do a full review. Like i said, i think it is a difficult time for all airlines in general. As a shareholder, we are dependent on the company to work its way through and figure out what it would like to do. [indiscernible] Malaysia Airlines has a new chairman. What does he bring to the table . What changes do you think the leadership could make . He is quite a renowned Global Leader in malaysia. Is going to be a new challenge for him. Very glad he is taking it up. Somebody with that kind of Global Experience and leadership. While the industry may be fundamentally different, there are a lot of characteristics he shares with airline industry. Difficult in terms of [indiscernible] he brings a lot of experience from that angle. Coming up, Japanese Convenience store chain family markets and offer. Market have family gets an offer appeared we will have the details. This is bloomberg. Im Karina Mitchell with the first word headlines. Top economicmps advisers says the administration has a number of issues with china but insists that phase i deal the phase i deal is not dead. Administration is weighing its options but insists it remains closely engaged in the trade deal. Two of americas most famous colleges are seeking a court order to stop the trump administrations new visa rules that could see International Students set home sent tom. Says it is m. I. T. Designed to pressure temporaryant a restraining order. Warren buffetts philanthropy along with Berkshire Hathaways underwhelming Stock Performance is starting to weigh on his net worth. The 68 billion is oldie is only good enough for eighth place. It is his lowest ranking since 2012. He has been passed by Steve Ballmer and by the google cofounders. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Karina Mitchell. This is bloomberg. Shery we are watching for shares of Japanese Convenience store chain family mart. We are the Bloomberg News editor joins us from tokyo. We are talking about a 30 premium over the last closing price. Does this offer make sense . Sense thatmake some they are reducing the overall price they paid. Some analysts have pointed to the fact that the last time the increased thursday, they were paying ¥11,000 per share. That is a discount. You noted it was a 31 premium. If you look, it is the same price the shares were Trading Market value at the beginning of the year. It is a fairly good price for them to come in at. Their eyes there is not a lot of logic for them to take out a company they already control. They already have 50 . While there is not a huge benefit to either side for this and, the pricing looks good probably ends up helping their p l. Haidi what is the outlook when it comes to family mart . They have cut their core earnings outlook to ¥57 billion. That is a pretty sharp cut. Obviously, the pandemic has reduced the fortunes of many retailers in japan. It is a tough business to be in right now. Ishink a company like this position to look beyond that. They have in a three credit rating. The Balance Sheet is Strong Enough to undertake a transaction like this. They are looking at this big picture digitalization. It is a Strong Company logistically. They are a supplier as well as owning this Convenience Store chain. For them, they are looking at the prospect of offering their own emoney. Integrating that into an offering of Convenience Stores so they can offer delivery as well. Basically vertically control the distribution chain. That is one of their big strengths as a company. It is a trading company. They are involved in a wide very a wide array of businesses. Operate a them to Convenience Store in a very efficient way. Shery we also have a few earnings out after the market closing shared what are we at market closing. What are we expecting . Before theing pandemic set in they were reducing their outlooks for earnings. They have been hit hard by the pandemic. They too have some strength in their finances. If you take a look at their inventories, they have not been rising that quickly. Sales ratioories to had been falling for three quarters before the pandemic set in. That is one thing investors are going to be looking closely at. What is the inventory level . The retail has responded to crisis by offering discounts, cutting into their margins in an effort to reduce those inventories, which would be creeping up considering so few people would be shopping these days. This is also a company that has a strong cash position. At the end of last quarter, they had a net cash position of 3. 4 billion. That is another thing. Investors have been taking a look at the dividend. That is something fast retail could be cutting. Haidi our Global Business editor in tokyo. We do have some breaking news. And other grim milestone for covid19 cases. Globally, the number has surpassed 12 million coronavirus cases according to Johns Hopkins. Quarter ofknow, a those cases are in the u. S. More to come on daybreak asia. This is bloomberg. Shery the csi 300 has climbed for seven straight days. Just two days away from the longest run since 2018. Can this really be sustained as we approach the china open . We are joined by our across asset reporter from hong kong. Things have been leading this really . Thanks. It is what used to be known as the new economy. Predominantly, the china and stocks on the shenzhen market. Sectors like information technology, health care and consumer staples. What is also interesting is that momentum has been doing very well as a factor. This is interesting because most quantitative strategists will tell you china is a reversal market. When momentum is doing well, stocks are Getting Better up getting bacet up too much. Haidi youre hearing people say this time, it is different. Sayingr Retail Investors there is no way i can lose money doing this. Are we seeing history repeating again . History may not repeat itself but it certainly does rhyme. The similarities are obvious at this point. The gains are parabolic. State media is cheerleading all the way. Margin debt is rising at the fastest pace since 2015. Analysts are not that worried yet because the sentiment is not as frothy as it was at the peak of the 2015 bubble. They are hoping the experience has driven tighter regulation and controls on margin trading. That does mean we will be watching statements from regulators and state media very closely going forward. Shery how much of the rally is being taken by Domestic Versus International buyers th . Both at the moment. Domestic investors were first in. Signs emerging of panic buying by overseas investors looking at the u. S. Listed china etfs. We have not seen a sustained peg up in the data a sustained pickup in the data. That is something will be looking at closely as well. Haidi our process that reporter. We will have more on the outlook for chinese stocks. Can these rallies be sustained . We will hear from the vole, head om research the volc head of research. Shery heres a quick check of how markets are trading. The nikkei gaining 3 10 of 1 . Reversing two sections of losses. This as we have more positive numbers coming from the core machine orders. Rebounding and seeing some expansion. The kospi up 7 10 of 1 . This as we continue to see this risk rally in the korean you want, korean yuan. The asx 200 of a 10th of 1 . Kiwi stocks are falling for a second consecutive session. That is it from daybreak asia. Our markets coverage continues as we look ahead to the start of trade in hong kong, shanghai and shenzhen. Standby for Bloomberg Markets china open. This is bloomberg. It is 9 00 a. M. In beijing and shanghai. Welcome to Bloomberg Markets china open. Down toe are counting the open of trade in the chinese mainland and here in hong kong. Region, mixed the starts head of chinese inflation data. Mainland equities have been on an absolute terror. The csi 300 rising almost every ov