Rules for Foreign Investors. The strict block count in australias coronavirus epicenter is extended two weeks, triggering warnings of further damage to growth, jobs and mental health. Of how u. S. Snapshot markets wrapped up friday. We saw the s p and nasdaq falling to a twoweek low with the spotlight on options trading as mega cap tumbled, the worst week for the s p since june. Gains in financials illuminated losses. This morning little changes with u. S. Markets offline for the labor day weekend. Switching the boards. Sawthis morning after we crude drop below 40 friday, stigler that level. Staying below that level. Energies Energy Officials are sing about Global Demand sing taketwothree years to recover to previrus levels. When china reports this morning will be watching numbers on oil and refined product numbers imports and exports. Mixed, lower after regional stocks marks the worst since april. Japan watching a typhoon that is to make landfall in the south where Companies Including toyota and canon have evacuated factories. Low. Es are at a a vaccine agreement signed with the australian government. Iaomi, aslibaba, x they join they hung send this month. Hang seng this the political scene remains tense, to say the least. Get mores and we will on tensions in hong kong where over the weekends police have arrested hundreds of people as prodemocracy protesters returned to the straight. Return to the streets. Stephen we have had weeks of relative calm so what happened over the weekend . It was the anniversary the date that the elections that were supposed to be held. The Legislative Council elections. Carrie lam, the chief executive of hong kong postpone them for a year on concerns of the chronic virus. That concert that of the coronavirus. That election has been postponed for a year. Protesters made the call on social media for people to turn out and they did. They marched through kowloon and through neighborhoods, some of the most crowded places on the planet. They set up arcades and chanted antigovernment slogans and held up lacquered and police responded. It was not necessarily as violent as past protests but 270 people were arrested as of 9 00 p. M. Last night, for illegal assembly. Another 19 were held on charges, including disorderly conduct, as well as obstructing and assaulting police. So there was a little bit of violence. Police did not necessarily and medially confirm the arrest of three prominent prodemocracy activists, chan come along as also known as lawncare. The government longhair. The government did come out with statement condemning the protest as unlawful and selfish. Even though the outbreak has abated in hong kong there are still widespread concern in the government that Mass Gatherings like this would spread the disease further. Now they also said in that statement that this chanting of independence slogans may be in violation of the National Security law. We need to confirm that because the police also made a separate arrest of a 47 euro man for quote during seditious words between the end of june and august. It was originally reported that he was possibly arrested under the National Security law. But again, local be a has been reporting that instead, the charges might come under an old british era antisedition law and not the National Security law. Because if you read the words by the letter of the lock on National Security law, sedition is not actually technically a crime under the National Security law subversion is. Sedition is not. So we will have to see how this plays out. Disney is being caught up in the hong kong issue over its latest mulan movie. What is the connection here . This is over a tweet retreated one year ago by the lead actress who plays mulan, and this live action disney plus streaming platform movie that launched friday. Shes a native of mainland china, but an american citizen. Reportedly in august, 2019, when processed in hong kong were raging, she retreated something along the lines of, i support the hong kong place, you can attack me now, what a shame for hong kong. Activists, not surprising that, have latched onto this as disney has launched this movie friday. Activist not a lien hong kong but across asia, from hong kong to thailand. Joshua activists not only in hong kong but across asia. Liu weeted, because endorses Police Brutality in hong kong, i urge everyone who believes in human rights to boycott mulan. Disney has not responded, but liu did change her tone a bit since last august, in february with an interview of the hollywood reporter. She backed off those comments and set it is obviously a complicated situation in hong kong, i am not an expert. Disney caught in the crossfire, and disney shares down 1 friday and 1. 6 thursday. This was a movie that was supposed to go into theaters but because of run a virus they decided to put it onto their fairly new they launched streaming platform, disney plus. But they need a lot of downloads for to breakeven. Our chief engle, north asian correspondent. First word headlines. Ostrow is Prime Minister warning of further economic damage after a Strict Lockdown in melbourne was extended two weeks. The State Government restrictions will remain in place until at least september 28th, whether gradual easing plan for october. Melbourne entered lockdown in july and the state of victoria has had over 90 of australias 750 deaths. Fierce winds and rain with the prospects of flooding and mudslides in southern islands. Km per hours as it hit kyushu. The storm is now heading for korea where the president s office is warning it could cause there is damage. People have rallied in belarus calling for the resignation of the authoritarian later, look at kashenko, following elections in august, saying the boat was right. The protests against him are unprecedented for their size and duration. Extreme weather returns to california with he waves triggering wildfires at the threat of blackout. Los angeles forecast to hit 43 degrees celsius sunday. Warningr grid has been of rotating outages and declared an emergency as temperatures climbed, sang up to 3 Million People could be affected. Ahead, booking a 4 billion gain on tech options despite trades being controversial. Vows to accelerate the opening of its Capital Markets say numerals are coming soon. Details live from beijing next. This is bloomberg. Regulators promised to accelerate the opening of Capital Markets and deepen reforms to attract Foreign Investors. Tom mackenzie joins us from beijing with details. What are the latest changes . The details we will get as soon as possible, quoting from the spice terror of the from the vice chair of the csrc. Out a form he spoke at sunday he said he wants to see more options available to Foreign Investors using the stock connect between the mainland and hong kong. He said they would also be allowed to trade commodities futures more easily as well. He said he wants to see more participation from Foreign Investors in the Chinese Markets and already moves to open the Chinese Markets to Foreign Investors have led to greater rationalization in the markets and more rational valuations as well. He pointed out Foreign Investors hold less than 5 of chinese stocks at present compared to 30 in markets like japan and south korea, again emphasizing he wants to see a move to encourage more Foreign Investors. And they will take for their concrete steps to open avenues for investors, to encourage them to put their money into play in the chinese market. This comes as big wall street firms are able to expand their footprint in that country following changes to regulations here. Chinas trade data will be out later on monday. Is the recent improvement likely to be sustained . Tom surveys of the economy suggest it will be, so yes. August, of exports for 7. 5 from 7. 2 in july. Bloomberg economics thinks it could be as high as 9 , above the survey aggregate. What they see a stronger demand overseas, particularly from chinas Major Trading partners. There is also a low base effect last year as well. Bloomberg economics has seen and thinks this talk is going to be an impact, the take up it imports from the u. S. That should push up the imports number. The survey says imports will increase from 0. 2 from a contraction of 1. 4 in july. Get those trade talks that took place, the review of the phase one trade deal in august may have had some impact in terms of china spinning up those imports from the u. S. Market. Those factors that play, the data could be out anytime from around 10 00 a. M. Local time but it does look like improving trade picture here in china. Up next, betting on a bubble. The ceo joins us for a look at how that is working out. This is bloomberg. Where you have to be tenure some now . In the next decade our overall business will see 10 times growth, they Growth Income it is are serving. 8. 4 unemployment is a headline story of this massive jobs improvement report. We had of course a strongerthanexpected number on the jobs front this morning. Thought youd start to see leveling off of this rate of improvement. We are broadly in the same range where people thought we would be, the unapplied at rate was going to spike significantly initially the Unemployment Rate was going to spike significantly initially. The important data point is the number of permanent job losses, which has gone up to levels we have not seen since 2013. To claim a labor market, where 1. 6 Million People each week are having to file for Unemployment Insurance because they have lost their jobs, this is not a sign of a healthy economy. What we take out of this report . One, it is a snapshot. In line over than expected, it speaks to a dynamic economy but not dynamic enough even the shock it has received. I think fiscal and structural reform have to act. Now we are in a paradigm where good news is bad news and bad news is good news. Because good news potentially means less support from the fed, less apart from the fiscal side of the house. We have much more work to do. We are not out of the was. We have to many people unemployed. Even though the numbers have improved radically and ahead of expectations on wall street. We have more work to do and are still way too many unemployed and much too much hardship. Some voices reacting to the betterthanexpected u. S. Jobs report. Joining us as they care about. Oncepts chair and ceo that pick in perils could complicate stimulus negotiations. Worries of a case eight economy. Friday larry kudlow pointed to the possibility of a scaling back. Jay powell fed chair cautions the u. S. Recovery could slow from here. More volatility for stocks had given this meal us the question . I think the reason the stimulus is so important for stocks has less to do with the economic recovery, and more to do, with getting the fed off the sidelines and printing more money to inject into financial markets. That theno question recovery is running ahead of schedule, making negotiations between congress and the president more complicated, negotiations between the house number 3 trillion on the senate of 1 trillion and this could drag on through the election. But ultimately, you mentioned a k shaped recovery. The jobs coming back are the jobs that are easy to restore and a socially distanced economy. The jobs that are not easily restored in a socially distanced economy, those people are still suffering. There are still struggling. We have one third of renters looking at potential eviction without another covid stimulus package and the money for landlords, those people are going to be out on the street. So there will be another stimulus package, it is just a matter of when, and when the stemless package happens, the fed will support it with more money printing. In our opinion irrespective of where the unappointed rate is. That anticipation, where are you seeing the winners . That probably once, first we need to think of this in two phases. Because the complications and negotiations in washington could drag this out through the election, we need to buckle our chin straps and recognize with the fed having hit the pause button on the money printing machine, we are now able to have pullbacks. We should expect more volatility than we have had and the last three or four months. But, once they get back in the game, once they come off the sideline and they had the print button again, in my opinion, the winners of this next phase in the bull market will shift. If we think about the bubble we saw 1999 and 2000, after you have the pullback and some of the speculative things blow up, there was another leg up in the market. But the superhigh flyers trading at 100 times or two hunter times or 300 times earnings were not the leaders in the next leg. It was the caput conservative names trading at already five it was the quote unquote conservative names trading at 35 times. We think it will be the big tech leaders, less the teslas of the world and more. The googles and apples. We are also really high on the homebuilding. [crosstalk] i think what you are saying is that if we see a sustained pullback that is a healthy thing for the market in the longer or mediumterm . In order to add the sense of breath to the market we have been waiting for . I think every market is benefited from a pullback. Going to steps forward and one step back. A kind of speculative option trades that blew up thursday and healthyi think it is a thing to clean that kind of speculation out of the market. So yes, i absolutely agree with that. I also think a market led on real speculative expectations of Earnings Growth and the companies that, you know, our trading at unsustainable valuations, that is also risky. I think getting a pullback where some of that real froth is taken out of the market, reestablish and i space, and then come back with more fundamentally driven things, like big tech and housing and, frankly, the commodities centric emerging markets. We have at a huge rally in commodities like copper and gold and iron ore. And the countries that produce those commodities have not participated. If you look at pricetoearnings in dominant big tech, if you look at Free Cash Flow yield, do any of those comedies look appealing . Well, i think we all, we have to look at things through a bubble lens. And we have to take the longterm discipline and the average is out of the equation. We need to recognize we are gelling in a world where Corporate Bonds are trading at 2 . Tenure treasuries are in the 60 basis points and if we look and compare this with the last bubble in 1999, you can get pe on for cap tech names into the 50s and 60s. Frankly i think the conditions are probably in place to see that happen again. Though myven valuebased instincts flinch every time i say is, 35 times earnings is probably going to look pretty cheap a year from now. Michael, this morning we see u. S. Futures moved to the downside and nasdaq futures falling earlier 2 . Volatility is the name of the game and we are seeing that rise ahead of the u. S. Election. How are you positioning given the heightened risk of more price swings . I will not be confident putting more money to work until there is a covid19 stimulus package and the fed has hit the print button again. Do think we want six months and a Straight Line straight out. We need a pullback. Thursday and friday were probably not sufficient to clean out the speculative excesses. I think we will have a nice, healthy pullback. That will probably in all likelihood be that catalyst to get the president very serious. He does not want to big Market Correction in the runup to the election. That is what is probably going to put him and prod the senate to make a deal with the house, and we get something before the election. Until that happens, i think we are going to have to deal with volatility. And the buy signal will be when we see a deal signed in washington for new covid19 to millis. Stimulus. Haidi do you still buy into the story of stockmarket exceptionalism in the u. S. When the dollar is so weak and you have all these opportunities across emerging markets as a result of that . I think emerging markets and europe look very, very interesting. I mentioned earlier emerging markets have not really participated in the rally in commodities. Look, this is where south africa is where gold is mind. Mined. Copper comes from chile. The opportunities for those markets to do better as they catch up with the rally that is happened in the underlying commodities i think is very powerful. I also think europe, they have not begun to really stimulate their economies. Yet they have pretty much kept pace with recovery in the u. S. , if you just look at their pmi service. There are some exceptions like spain which have had a second spike in covid. But for the most part theyre having a nice recovery too, before the everly had their economies with before they really hit their economies with the two truly dollars to millis package coming early in 2021. Trillionpe and 2 stimulus package coming early in 2021. Europe looks interesting. And Warren Buffett is not buying into japan for nothing. Cash buybacks give huge opportunities for shareholder strategies and you can see good things happening there as well. Get a quick check of the latest business flash headlines. Rebuffed takeover approach from iolia, which it offered to do a takeover to create a water and Waste Treatment Company with a 47 billion dollars avenue. At the hot well extends reduced willor staff etihad extend reduced pay for staff until year end. 10 . They will be cut victoria extends lockdown measures for another two weeks but says it will begin easing restriction soon. Details ahead. This is bloomberg. Sophie you are watching daybreak australia . Protests daybreak australia. Protests have returned to hong kong. Police have arrested 300 peoples including key activists. Themain threats was Legislative Council elections which were meant to be held on sunday. Coronavirus cases are approaching 27 million with 881,000 deaths. The u. S. Reported 45 new cases 45,000 new cases. Case numbers slowed in new york, florida, and arizona. Is 3000,in that u. K. The biggest increase since may when the country was under lock down. Cases in india have topped 4 million with the country set to overtake brazil at the second both infected nation. Europe reported 90,000 new cases on sunday, the highest single daily figure at any time during the pandemic. 70,000 indians have died and attesting rate remains low. Germanys top diplomat has warned russia that burlington support of the nord stream 2 pipeline is at risk if the kremlin does not cooperate in providing answers of the allegedlys in a of alexey navalny. Novelli was attacked with a nerve agent. Involved,an companies almost half are german. The top tennis player at a u. S. Open after he hit a line judge with a ball. Bid for 19th title in accordance for the rulebook for reckless actions on courts. He smacked the ball in anger after going down in the first set. Haidi shinzo abes cabinet Approval Rating has risen 15 Percentage Points according to a current poll. This is likely to reflect the fact that we see his likely successor being the chief cabinet says it chief secretary who has emerged as the most likely person to replace him. We have heard from him, indicating he is likely to stay the course when it comes to easy Monetary Policy and is seen as a steady hand to steer the ship of set for contractionary conditions with more gdp numbers due this week. That cabinet Approval Rating rising to 52 . Lets get you australia where we have heard restrictions think that containing covid19 in victoria will be ease gradually over the last two months. The Prime Minister is calling the extension hard and crushing news. Paul allen will be with us with more details, we continue to get context as to how this creates implications for the broader economy given the state of victoria accounts for 25 of gdp as well as implications for the labor force. Ceo saidlantic airways of the elimination of 1100 more jobs is necessary to ensure the survival of the airline. With him earlier about the companys cash burn. In our minds, we have set ourselves up to deal with continued uncertainty on our major markets, also the uks major market, which is that u. S. And u. K. Travel, 262 billion. We have set ourselves in that regard, but with this 1. 2 moneyn and injection of the the virgin group, plus cost cuts we have put into play should allow us to be in demand fromen if the u. S. And u. K. Across the atlantic is curtailed well into the beginning of next year. 20 you expect demand to pick up . Whendo you expect to do you expect demand to pick up . We have had a thriving cargo areness and now, we launching and have launched and adding routes passengers and services on top of the cargo business. Whether it is los angeles, new , thishong kong, shanghai is how we are running the operation. We expect 25 capacity to come online before the end of this year and in our estimation, it could be 50 next year. Hopefully a bit better. Uncertainty also with the elections, which impact the opening of these borders. What is the path to profitability . When is the point at which you think this is going to put you back into the black and how flexible do you think that number is . Actions we have taken, we have been leading from the front, the first to do many things. We suspended flying to china on the first of february. So much has happened since and we continue to lead from the front. Is, a recovery starts 21 would, 21 t1 be on the long haul side, 50 of the 2019. Our goal, assuming things become more normal once a vaccine is we would like to be profitable, but the challenging goal we have the right fleet, we have the right markets and partnerships, but we are subject to demand and opening of those borders, of which is so essential that we introduce testing across the u. K. At the leadership position so flying can resume freely and the recovery can take off. What does that Testing Program look like . How would you like to see it work . The ideal would be testing before departure so people know when they arrive at their destination, they can go about it. Do ae beginning, we can trial where we can do either at departure and upon arrival tests, which are more vapid, cheaper, easier to facilitate, thenot distracting from Health Service and as schools and other critical infrastructure. The idea would be to give confidence and get rid of quarantine. That was the Virgin Atlantic ceo. Lets get back to australias restrictions getting set to be eased in victoria. Slow gothis will be a back to normalcy. The government still wants to see more. Premier and victoria is saying, if we open too fast, we might as well not open because we are setting ourselves up for a third wave. The extension of the restrictions are fairly tough. 63 new cases from the last weekend the 24 hour period is well done from a peak of 687 in early august. Easing in14, victoria, the curfew will be relaxed, it means more exercise hours will be allowed. The curfew would remain in place until the end of october. Until november 23 if there is new set of cases for 14 days. We saw some protests in melbourne over the past couple days. The Victorian Chamber of commerce has slammed the roadmap saying businesses are going to fail and apply minister has called it hard and crushing and made it clear this is a decision for the victoria government. He is putting distance between himself and daniel andrews. There is going to be an Economic Cost to this. Sophie the situation mean some economists are expecting more action from the rba. What is in the Monetary Policy toolbox . Paul not a great deal. We have rates at a record low, quarter of 1 . That cash trade and the threeyear hitting low at 10 basis points in the next three months. That is not the majority view. The majority view is the cash trade stays buried is in the rba starts to ramp up its bond buying program. We did hear more from the government last week, a landing facility for banks has been expanded and extended, but there is concern around the aussie dollar. That has climbed more than 25 from its march low. The one thing neither the rba or economists expect is a negative rates. Is negative rates. Paul allen there. Next, hss the trading the pace for trading asia sets the pace for trading. This is bloomberg. We are seeing some nerves in the market with u. S. Futures under pressure amid anxiety overstretch valuations and in asia, we have futures under pressure as well. Holding,ace, officer trading near a 2019 high. Check out cable, extending losses for a fourth session ahead of brexit talks on tuesday. That dilutes the braves a divorce deal. On what tos get more expect for the rest of the week. Settlingof the dust give you my world how can i, when you wont take it from me you can go your own way go your own way your wireless. Your rules. Only with xfinity mobile