The show. A oneday day holiday on monday. We have seen initial gains of 85 , but still a healthy debut. A big ipo in hong kong. Smic is picking up 3 despite reports earlier. Gaining and alibaba is also up, close to four points. Currencies it onto in terms of cnh. It is around the level that it was fixed at. Pound, between brussels and london, increasingly concerned. It is currently down. 4 . 39, 1. 7 . Yvonne how they are going to reopen is still the key question. More than 4 incline. A rallyting a blip for reversal. Thisrine, we have seen text selloff just for a bit. Thisthat it can lead market at the moment or i looking too tired at the moment . On one side, you see the market really being driven with a lot of liquidity and strong retail participation, also in the u. S. , so i know it is contrarian, but when you look at the sectors, some of these companies are delivering on earnings. Fundamentalsat the and these companies that can achieve earnings growths. What kind of correlation are you seeing between u. S. And asia stocks right now . Is it more of a safer bet . To go within have the big sector. In china, we have seen this in 2020, but also in 2018 and 2019. The big companies, the sort of nonflashy tech names. You could argue that they look havective, but we also sheer competitive intensity with share. Aining market when you look at valuations, they are a little bit excessive. Just something to be mindful of. Tom briefly interrupting to show a picture of jie zheng paying at the great hall of the people in beijing. This ceremony is being held to honor what beijing is describing as heroes that battled the covid19 virus. They will not he of course was shot down by local officials from the start of the outbreak, but the focus will be on health wuhan. Ls who rushed into what wee, in terms of are seeing domestically, yvonne was touching on this, this move somef tech stocks and into of the cyclicals. I am looking at the breakdown today. You are seeing upward gains in real estate. You are seeing Consumer Discretionary i. T. Shares. It seems like we are seeing some rotation today. To what extent cannot be sustained . Is there concern about being overly focused . When we have seen diversification, it has been quite shortlived. When you do see a cyclical economic recovery, you tend to see the cyclical value names play out first, and then names such as the banks, so hopefully we do see this rotation occur. Names areonomy improving in terms of Corporate Governance and dividend payout. I would not ignore this segment of the market. Want tonow you do not name individual stocks. But what about the mainland . At this time, devalue names. Have been ignored. We have some earnings potentials. Is verydend name powerful. We saw a change to the code of conduct in china. You really see this focus, especially the larger set on enterprise. Shareholdersority to payouts. A lot of other companies in terms of commitment. We have seen the last two months, a consolidation phase. That couldme drivers lead to a next leg higher . Oil markets,ok at there are three key factors. , we are of containment looking at the pace and sustainability. Quicker. G a lot third prong would be implementation of direction. Buck the trend. A waitve really taken and see approach. Monetary wise, more of a neutral start. Have the they still toolset, whether infrastructure, supporting the consumer or focused on supporting the economy. Are youhow closely watching the domestic space in china . We had President Trump vowing to curb their relationship with china. Is that he will more interest in domestic related stocks . Demand story has been a key priority for many years, so it is no supplies. What is surprising is the renewed focus on ensuring there is not too much destruction when it comes to chinas supply chain. Some ofhen you look at the names, you can understand why investors would like to see these structural changes triggered by covid, but there is broad diversification across the entire china market, not just in terms of small or large cap, but medium as well. Have greater visibility on the back of that, in terms of Chinas Health . We are actually seeing improving earnings guidance. A lot of it has to do with the weakness that we saw in the first quarter, but really driven by these names that are well loved. Not just supported by multiple changes but upgrades. Have antail names, you offline and an online presence. Is not just about Capital Appreciation that we should be mindful of, but the general return story and how the company can reward shareholders with dividend payouts and Capital Appreciation. The earnings story looks quite promising. Another driver but all in chinas favor. Yvonne thank you, catherine young. Joining us from hong kong. Just 20 bring you back to look at those live pictures from beijing. We are seeing the chinese president presenting metals to for those whos helped during the pandemic. We have seen a recovery in china as well. Things are looking a little bit better when it comes to exports and imports did disappoint. Tom. Quite remarkable. Today and theyns were all imported. Warned Boris Johnson over his latest plans for brexit. Johnson has set a deadline for an accord to be struck. Trade talks resume this week. The pound fell against the dollar. Fears are growing over a human and economic crisis in india, which now has the secondhighest number of coronavirus cases with over 4 million infections. It has already suffered one of the major growth contraction. Cases are at more than. 7 million russia and Opposition Leader has woken from an artificial coma in berlin and is said to be responding well to treatment. He says he was poisoned by the nerve agent. Chancellor Angela Merkel has promised a coordinated response with nato allies, threatening to pull out of the asked pipeline project. Still ahead, revised figures show record gdp plans were slightly worse than originally estimated. Japanak to the head of economics about that and the task facing the next Prime Minister. Talks tougher on beijing, vowing to scale back. What that means for relations. This is bloomberg. Yvonne back to those live pictures. You can see president jie zheng paying there, honoring some of these covid19 fighters. He is said to make a speech as well. Reallythat china has come out of this crisis. They are honoring those who have fought in this pandemic. Things will perhaps be looking a little better. When you look at the cases thatted, it does suggest china does have the virus under control and has done a good job. When thed to cover up doctor tried to raise the other. It is worth reminding. President trump talking about geopolitics. President trump has ramped up his antichina rhetoric. Take a listen. We will end our reliance on china once and for all. If they cannot do it here, let them pay a big tax bill that somewhere else and it into our country. We will prohibit federal contracts for companies that outsource to china. Maketrump is seeking to china a key election issue. Has the latest on this. The significance of these comments from trump . Make chinaying to the big issue. He can an area where attack joe biden. We are not there yet. Agreement is governing economic ties at the moment. Worrying, as he moves to protect his security that led to the actions against tictoc and we chat, specifically as we have more Smart Devices coming online over the years. It could eventually lead to a greater split in supply chains around the world and create different ecosystems. Along those lines, it was quite interesting. Minister hashinese it is meant to counter the action by the u. S. Yvonne we heard the literate the latest titfortat when it came to generalists in china that work in American Media outlets. Hey have been delayed china saying that all options are on the table. How far are they willing to go . The action that china took regarding visas is to get their ducks in a vote. Trump has put them all on 90 day visas that are renewable. The next day for that to, is just after the election. They are basically getting all so that theyners can take retaliatory action, if they need to. Is, reports that we are seeing to australian generalists who fled the country , after being questioned over a police matter. Yvonne eu warns the Prime Minister about the brexit deal he struck over a year ago. Boris johnsons gamble means for the pound. Yvonne the European Union is morning Boris Johnson not to brexitart parts of the acquired. Eu withouty from the a trade deal in place. David, from Market Reaction to brexit news, do you think investors are assuming that a deal will still be reached . The sterling held off yesterday on the news. Reaction,see a bigger some thought it was just posturing. Some deal will be reached. The market at the moment, it is in everyones interest. For the moment, it is posturing. A deal will be reached by the end of the year. What is therling history of brexit that we have seen . That is a good question. They would have to factor that in very quickly. Particularly with the 31st deadline approaching. Markets will have to adjust. It has been supportive out there. Really, the market needs to look at what will happen. We need to start looking at three months and five months. If they start picking up, i think the market is getting spooky to be. Ticking. T with the up the market is very concerned about this. All things brexit, but so much more. Here is the latest is this flash. They have started the process to replace longtime ceo who plans to step down next year. Ofled them through a series takeovers. Outside candidates are being considered. The founder of netflix says working from home has no positive effects and makes it harder to debate ideas. Workforce will not have to return to their offices until a vaccine has been found. Spend at, workers will least one day at home. Remote working is particularly bad for international relationships. Yvonne taking a look at markets, we are seeing green on the board. We are following the session with gains higher. Shrugging off selloff in textures at the moment. That lunching onto break, still digesting that the gdp report finalized. Revisions were worse than expected. At currency. Dollaryen at 106. 26 with the renminbi holding strong. This is bloomberg. You can go your own way go your own way your wireless. Your rules. Only Xfinity Mobile lets you choose shared data, unlimited or a mix of each. And switch anytime so you only pay for the data you need. Switch and save 400 a year on your wireless bill. Plus, get 400 off when you buy the new Samsung Galaxy note20 ultra 5g. Yvonne 10 29 a. M. In hong kong and beijing. Here your first word headlines. President trump has taken another shot at china as election rhetoric rises in the u. S. Facing decoupling or massive tariffs in the u. S. And u. S. Companies will be banned from winning federal contracts. It plans to launch a global Data Initiative to counter washingtons latest restrictions on chinese tech. Pres. Trump we will end our reliance on china once and for all. Whether it is decoupling or putting in massive tariffs, we will impose tariffs on company that deserved america to create jobs in china and other countries. If they cant do it here, let them pay a big tax to build it someplace else and send it into our country. We will prohibit federal contracts from companies that outsource to china. Yvonne alas last two accredited australian journalists based in china have fled the country as diplomatic relations between the trading partners worsen. Saysustralian government they left after Chinese Police demanded interviews. Spent several days in the Australian Embassy before getting permission to leave. China has been accused of delaying the renewal of of press credentials working for u. S. Media outlets, including bloomberg, cnn, the wall street journal and getty. An official tweet of the applications are being processed and reporters will be able to live and work in china while that happened. The hold is seen as a countermeasure to restrictions placed on chinese reporters in the u. S. The reserve bank of india is setting new rules for lenders looking to restructure loans that have turned bad because of the coronavirus. We have to consider financial parameters before advancing health. The central bank has identified 26 centers at risk with our makers, aviation and tourism at the top of the list. Lets check in on the Market Street investors brushing off those decoupling threats from President Trump it is mixed on the mainland. Catalyst in terms of what we are seeing. The shanghai composite is below that level. That is this word level we have seen in place since august. It is currently below that. Better kong, slightly picture, slightly more positive. Did have a debut that is down as well. You can see it is up more than 60 ,. Be the chinese leading chipmaker of 3 . Tencent is down 2 10 of 1 . Alibaba is gaining close to three points. We can move on to the final board we are looking at. I should mention the japanese economy in focus, we have that revised contraction for the Second Quarter. Now in the currency space, the pound, brexit negotiations, those torturous talks continued. Under pressure for another day. Gold is still below the 2000 level. And oil remains under pressure as well. Saudis continue to cut with a lack of demand. U. S. 10 year, 0. 71 is what you are getting in terms of the yield. The Ruling Democratic Party is officially starting its campaign for a new leader which is abes top aide. Seen as the front runner. This comes as the final quarter gdp numbers shows a slight widening in Japan Economic contraction. Lets discuss with the bank of america head of Japan Economics global researcher. Thank you for joining us. Lets look forward past the Second Quarter gdp. What is the data telling you about the shape of this recovery in japan . Thanks. Gdphave to remember this data is very old. What we see in the more highfrequency data is the economy continues to improve, although it is a very bumpy manner. Weve had some stalling of momentum in august because of the second wave of the coronavirus outbreak. With this virus wave coming down again, we are seeing a biggest coloration in momentum. You will see a gradual uptrend with ups and downs associated with the successive virus waves. Been a concern about the health of the corporate sector in japan. How was that looking to you now and was there enough potential support for the government and the boj for the corporate sector Going Forward if you do see another flareup in the virus or another leg down in the economy . I think the Corporate Finance situation was a big Downside Risk that we worried about earlier in the crisis but compared to three months ago, we were much less worried about it. Tremendous and aggressive Government Support has helped backstop corporate financing. We have seen an increase in corporate bumpers street even if we dont do get another outbreak, i think we are not going to see a rise in bankruptcies and these downside basedhave been put at thanks to these government actions. Do you think looking longerterm that the japanese economy can return back to prepandemic size . Or have we just reached a peak because our economists are flagging warnings that perhaps this Health Crisis has delayed these Critical Reforms that needed before the demographics will actually start longerterm hurting the prospect of growth. Do you agree with that stance . Izumi i think it will take a while, but economies will return to prepandemic levels. I think what some may be worried about is whether we are going to be able to foster the creation of new industries. They had quite frankly stalled over the last couple of years and going to reaccelerate. I think that is where this leadership transition gets kind of interesting. That the keyst secretary is likely to be elected as the next president. He has a very strong track record of reform. He has been a big proponent of the regulation and i think if he is willing to test new ideas, that could be a potential positive for japans productivity and i dont think we have to be so worried about the feature. Yvonne so, what part of abenomics is he likely to keep in place and what could be dialed back . Again, we are still in the midst of this coronavirus crisis. I dont think he is going to dial back but the broad policy mix of an extremely Aggressive Bank of japan with super loose Monetary Policy and general flexible fiscal policy supporting the corporate and household sectors will continue. I think where hes likely to try to make his marks fiscal policies right now, the focus is on income support measures. Keeping some of these corporate, who sectors alive. I think Going Forward in this new phase of the crisis, we are in the recovery mode. We need more strategies to try to foster new technology, foster new industries. I think he will look at incentivizing that and hes also looking at administrative reforms and trying to concentrate the decisionmaking further in the Prime Ministers office. I think theres some promise of execution there as well. Tom hes a reformer. Does he have a strength of capital so we dont see a repeat of the infighting we saw over a number of years in japanese politics that has led to policy staffers . Is that a risk Going Forward . Long after such a premiership under Prime Minister abe, it is a risk. The history of japanese politics shows generally the Prime Minister has a shortlived time in office. To remain going to be strong to show that he is capable of being more than just a caretaker, more than just the point guard behind the scenes. If thats the case, i think the public Approval Ratings will follow. He goes into the september leadership election which is arguably the real battle with some momentum and we could see him serving beyond one year. About when it comes to the International Stage . Influencedwn to be in the global stage, hes able to make these trade deals, formed the strategic partnerships. Do you think he has that kind of presence as well in the global severe . Sphere . Izumi i think it is widely recognized and perhaps he himself would admit his strong suit is domestic policy and has less experience, especially being the front person for Foreign Policy mentors. Is going to try to rely on his advisors. On Foreign Policy, you are going to get continuity. I think the centrality of the u. S. Ine japans Foreign Policy is not going to change. They will build off the foundations that commissioner abe. Very capable advisors to then support policy agenda. I want to bring it back to markets because you mentioned what we are seeing in jgbs recently, that yields are rising in japan. The government ran some debts applied to run the stimulus spending. Bondsg against government in japan has long been known as the widow maker trade. Do you think this time is any different . Thats a hard question to answer because i will just repeat like a broken record what i have been saying for a while. When it comes to yields, i think the bank of japan is quite flexible and relaxed about a nice steeping of the curve driven by economic recovery. And they are not going to try to intervene. Obviously, the yield curve control remains in place. They will try to control the curve. I dont think thats going to change. On thisnot bet historically increasing bond yields because of the dojs commitment. Thank you for coming on. Up, the worst place to get the coronavirus indias skyrocketing sky would virus cases takes it on track to overtake the u. S. We will bring you the latest and details on that story. This is bloomberg. Indias is surge surgeon coronavirus cases puts it on track to overtake the u. S. Is the worst nation and that is sparking a human and economic catastrophe especially in the economystricken areas. Whatever his intentions, crippletrict lockdown the economy. It also displaced millions of people. Servicesminimal health and absolutely no financial help for those who lost their jobs. Criticismso facing from the front line on the virus fight. The state can, and has done very little to help them either financially or otherwise. As you said, india is now the worlds secondlargest outbreak and its half the u. S. Total. It gives us a preview of what might other happen in other countries. Damageat is the economic at this point in india . Seen a 23 ve just contraction in gdp for the last quarter. Indias economy is really struggling. That isirus gain space, any possibility of a quick recovery. Two things are going to happen. A vast number of people are going to die. If they dont die, they are going to lose their livelihood. As you mentioned, that is going to be an economic and human catastrophe. It risks reversing years of rising income and Living Standards which has helped to lift millions out of poverty in india. Experts tell us the ripple effects will be felt far beyond the south asian region. As one tbd mala just told us, no country one eb dme allergist toldus epidemiologist us, no country is safe until all are. Yvonne they are different in their epidemic at least during the second wave has been concentrated in Migrant Worker dormitories. What has changed there . After declaring those dormitories clear of the virus, there is now a resurgence in those worker dormitories. Which as you say had been previously cleared. That follows a monthlong National Effort to test, isolate and treat the high risk for worker community. It points to the continued difficulty faced by nations even those with really good comprehensive and wellfunded virus responses to curb this disease. You also saw similar flareups in japan and south korea as well. Each country is really facing an uphill battle to really stamp out these epidemics. Tom south and Southeast Asia government editor ruth pollard in new delhi. Coming up, russia is the first country to approve a covid19 vaccine. We hear from the ceo of the Russian Direct Investment Fund on efforts to get other countries interested in producing and using it. That could be a tough sell. This is bloomberg. Yvonne i crossing the terminal. In hong kong, the Hong Kong Economic times is reporting the city will ease restaurant limits to allow four people per table. We did see some relaxations of those restrictions on friday where some of these gyms and beauty parlors were reopening. Now we are seeing a little bit more of that capacity and some of these restaurants. Potentially some good news here. Tom yeah, good news indeed. Russias Health Ministry says the first batch of its socalled sputnik 5 Coronavirus Vaccine has been produced for use in the general population. Health officials outside russia have raised concerns that shot was approved even before clinical testing had finished last week. Bloomberg spoke with the ceo of russia direct Investment Fund which is backing the vaccine. Not at all. First, we were criticized and then saw britain followed. The u. S. Said they may want to register before phase 3. You need to understand technology and what is published. Our technology is based on a virus vector which is an approach which has been proven safe for the last decade. Military with the vaccine since 1971. It is very different. It is something other people are using. Not only do we have great data, russia gotreat and before phase 3 and we have four trials of more than 40,000 people in russia and trials in saudi arabia, philippines and other markets. You mentioned those other countries, how many other countries have expressed interest in buying and how many have signed binding agreements to buy this vaccine . We have interest in more than one billion doses. It will be announced an agreement starting this week. More than 20 countries would like to pursue it. Countries who want to pursue it, its a big difference. The human approach has been started. The mrna approach, there is zero longterm status of longterm effects including cancer or infertility. We are confident that most of the countries will want to have it in their portfolio. We are not the only ones doing this. It is also johnson johnson. Theres also there is no doubt it is the most researched, safe and Proven Technology and and more countries understand and appreciate that. Any European Countries that have reached out to get doses of this vaccine . We had some discussions with european nations, but we did have a bit of focus on mrna, vaccines. We understand that will be a place for some of the producers. Just important, i dont want to repeat too much. Those vaccines, no longterm research. Our vaccine is based on vaccines that russia has done six years ago, went through all the cases of clinical trials. I think it helps countries to work with russia. Latin america, middle east, asia realize we will produce more than 300 million doses of our vaccine in india. And we are building very Strong International partnerships. Do you know if president putin has been offered the vaccine . If so, has he agreed to take it . I know moscows mayor and defense minister, agents to president putin, have taken the virus the vaccine. I dont know about the president. His daughter took it. The mayor of moscow, the defense minister, the interior minister. I too as well as my family and parents. We are confident with the vaccine because we know the platform is safe. One of the criticisms people say it is only 76 people and astrazeneca did 1000 people. If you look at the astrazeneca study, they gave two to only 10 people. If you use two shots, russia can do four times more people than astrazeneca did. The are more details. People who understand the science are confident in the russian vaccine. It is very important they check the longterm consequences. It was studied before it got approved. Yvonne that was the Russian Direct Investment Fund ceo Kirill Dmitriev there. A quick check of the latest business flash headlines. Asg kongs hottest ipo shares are surging on its debut after it was overbought a record 1100 times. The bottled Water Company which ihas raised more than 1 billion from the listing. Another sign the Hong Kong Market is roaring ahead despite protests, the coronavirus and geopolitical difficulties between china and the u. S. Samsung has won a deal to provide 5g Wireless Solutions to verizon in the u. S. A big win for the electronic giants networking business. The contract is valid through the end of 2025. It marks one of samsungs biggest contracts into decided to enter the networking gear business, taking on nokia, huawei which is now battling u. S. Sections. Jp morgan is doubling the number of Investment Bankers coming back to its new york and london offices, as wall street inches back to prepandemic work arrangements. Wants 50 g giant of its dealmakers to be at his desk on any given day. Jp morgan staff will be allowed to work from home one week on and one week off. Tom lets check in on the markets. Not a great deal of excitement in the mainland or in hong kong. It is essentially flat on the shanghai composite below that 3300 level. We can move on to the next board. We are looking at the kospi up 6 10 of 1 . The sti up 14 points. Yvonne . Yvonne you dont want to miss this interview coming up. The german finance minister joins bloombergs Francine Lacqua for exclusive interview to discuss the eus economic recovery amid the pandemic. That is 2 p. M. London, 9 p. M. Hong kong time. This is bloomberg. 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. It is almost 11 a. M. In hong kong and this is bloomberg. Rishaad a top look at the stories. Investors shrug off concerns about the u. S. Textiles. Threateningrump now putting tariffs on china. Party startsling its contest for new leader but key heavyweights in favor of shinzo abes top aide. Rishaad 6 million in shares since last year. Higher withcks are australia leading the pack in the european shares climbing. The s p futures pointing to a higher open. Investors return from the Labor Day Holiday after a selloff. All eyes on tech shares after reports of big options. 1 ,a looking down 2 10 of after rising half a percent earlier. Chinese stocks at two key levels. Asnese assets in focus President Trump says he intends to curb economic relationship with china. Crude near its two month low. The price cut suggests steel consumption is wavering in key markets. Rishaad lets he was going on with the indian session pretty much flat. The market just came on board. Moving to the downside, 1 10 of 1 . Worse. Ional train at trading on 73. The 10 year yield creeping up. The best we have seen in 20 months with the indian bond. Off and as weve had the reversal of whats going on in india as money has been coming out of the stock market. Investors taking stock of a tech rally that is fizzling. The extreme valuations. Goldman sachs continues driving the return of the current bull market. Entering is our guest who does not see significant rotation away from tech stocks. Lets get over to haslinda for the first word headlines. Haslinda thats right. We are giving you live pictures of shes in pain xi jinping speaking in beijing where he is giving commendations for the covid19 work. China in focus, first in, first out, some touting it as a model of how the covid19 should have been handled. China started in wuhan. China says 10 cases as of september 7 have been imported. Now, xi jinping giving commendations for the covid19. There are live pictures for you, rish. Rishaad my apologies. Lets get to the next guest. He does not see a significant rotation away from technology. He joins us from singapore. Great to talk to you. Lets start with why do you think the tech rotation story is not really a flyer . Will seehink you something more attractive on the other side. We still struggle with cyclical stocks. The volumes are still pretty mundane. We are not getting significant prices to the upside which is still quite a contrast for the tech sector. Rishaad absolutely. Tell me about what you have right now from your client base with a High Net Worth individuals. At times, it is all about wealth preservation. Of late, it has been about growing your capital. Is there an Inflection Point where they retrench and thats going to be key . Gary i dont think the ofrenchment starts in terms a significant shift to strategy until the fed changes strategy. We are still getting more of what weve seen from the last decade. The feds underwriting the market, dragging more deals down. People are searching for income. They are saying if i cant find income, i will go to capital growth. There are few sectors that offer a confirmed, 100 probability you will get activity in terms of capital gains. Rishaad absolutely. What is the noise you are getting at the moment . Whats the biggest question you are being asked by your climate ent base . Gary a big backing up of longterm Interest Rates. The fed has been a bit ambiguous which anchored to shortterm for the markets. Near zero sort of Interest Rates but with a let longerterm Interest Rates go higher . We dont think so. Athave seen Interest Rates tenure on the u. S. Government bond move towards the 1 level. I think the fed would be managing the yield curve and getting it back down to maximum 70 basis points. Haslinda gary, you talked about how you are not seeing a rotation out of tech but faang stocks trading at 30 times. When do they get too expensive . Growth stocks is the valuation for the future profitability. These companies have profits these days. You divide it by discount rate in the discount rate is close to zero because they are not giving us projections into the market. Find any company out there giving you 10 , 20 earnings growth, it got to almost put an infinity p multiple in. Maybe exaggerating but the p multiple could be a lot more. Haslinda we talked about how Masayoshi Son and softbank are taking a big bet in the options market. What do you think of the options frenzy . Do you expect it to persist . Gary i think it will. The markets being cold now because softbank is a very major player and the volumes would probably overwhelm buyers. Not to say it is a manipulated market. Maybe softbank is running a hedge fund now in their corporate strategy. It just shows there are very few places people will try to make gains for longer terms. It is very focused on one sector, but these companies are delivering. Corporate profit forecast has gone up 10 since june. Still down from where they started. There are very few sectors delivering that kind of good news for the moment. Haslinda gary, the trajectory higher for the stock market is not likely to be without bonds. How do you hedge against the volatility that is expected . Gary its a good question. Weve obviously got a very strong rebound in the third quarter. The gdp numbers have gone up. Then, things will calm down. We have gone down a long way. We will recover somewhat and then things will have to get back to normal. I think the one concern i have at the moment is that Central Banks have been helpful i am not sure the governments will be so helpful. They are limited on fiscal policy. They spent a lot of money already, driven debt up. Most countries are close to 100 or beyond. Governments a little more tentative and maybe people can be more concerned about the outlook for growth in 2021. About thislk to me brexit arrangement for the moment. It does seem the British Government is playing with fire. Is this real . Going right to the y with regards to this october 15 deadline. Chucking away the agreement or seemingly doing so does not send the right signal, particularly to people who are sterling bulls. Ishaad i would say it concerning. It was near the 135 level. I think there is a risk we see it going back below the 125 level get if the leadership continues this negotiating position. At the moment, it seems both sides are playing hardball and im not sure the europea are going to break. That theure politicians and the u. K. Are going to give either. Billeting that will give it is sterling and it could be headed towards 125. Haslinda just one question before we let you go. E. M. s have been laggards. Will they outperform the next few months or not . Gary i think so. I think they are kind of forgotten but still have longterm good growth. I would expect better performance through the quarter. Gary, thank you so much for spending time with us. Heres the first word news. Johnsonas warned boris of his latest plan for brexit. The European Commission president was responding to british threats to complete the u. K. Separation from europe without a trade agreement in place. Johnson has set a deadline for the court to be struck. Trade talks resume this week. The pound fell as much as 1 against the dollar. Fears are growing of a human and economic crisis in india which now has the world second highest number of coronavirus cases with over 4 million infections. It already suffers the greatest contraction among major economies. The gdp falling by 23 in the Second Quarter. Global cases are now in more than 27 million with 890,000 dead. The reserve bank of india is setting new rules for lenders looking to restructure loans that have turned bad because of the coronavirus. It needs to consider financial parameters such as liquidity and debt before advancing. The central bank has identified 26 vectors at risk with carmakers, aviation and tourism at the top of the list. Russian Opposition Leader has woken from an artificial coma in berlin and said to be responding well to treatment. The German Military says he was poisoned by a nerve agent. The german chancellor Angela Merkel planned a court a native response with the European Union and allies and threatening to get out of the pipeline target. The man accused of killing saudi government critic Jamal Khashoggi have escaped the Death Penalty and instead being sentenced to between seven and 20 years in prison. Five of the eight had been given the ultimate punishment. The sentence was commuted after khashoggis son said he had forgiven them. Khashoggi was killed two years ago in istanbul. Getting over to beijing. These images coming through. Besident xi jinping will giving awards for the handling of the covid19 outbreak in china. Giving commendations. What is also been saying is hitting back a donald trump as saying the china coronavirus data has been transparent and true despite accusations from trump, saying they have been telling lies about what they saw in the streets of their city as well. That is xi jinping at the moment. Speaking at a meeting in beijing. Just saying the data on the coronavirus has been transparent and true. Still ahead, we take a look at indias stock market with the big inflows of foreign fronts despite the worsening virus situation and an economy that is struggling. We will be speaking to haslinda next, the u. S. President threatens to sharply scale back economic ties with china as he makes his antichina stance a central election issue. More on that. This is bloomberg. Haslinda President Trump has ramped up his antichina rhetoric, vowing to curb economic ties with china. Our. Trump we will end reliance with china once and for all. Whether it is decoupling or imposing massive tariffs. We will impose tariffs on companies that dessert america to create jobs and other countries. If they cannot do it here, we will make them pay a big tax. We will prohibit federal contracts from companies that outsource to china. Haslinda he is seeking to make china key election issue with the vote less than two months away. Jodi schneider joins us now. One are the potential implications of trumps intention to curb the u. S. Economic relations with china . What might get affected . Jodi yes not really set when he would implement such policies but he is framing this as part of a second term agenda. Saying if you reelect me, i will go ahead and continue to decouple from china. Hes threatened to punish any American Companies that create jobs overseas. For bid those that do business in china for winning u. S. Several contracts. It would be punishing companies in a sense for going ahead and doing business in china. Obviously, he is trying to make this an electionyear issue. Hes portraying his opponent joe biden as being a lackey of beijing. Trying to turn that argument into something that will help him with his base. Turn has tried to turn this against the president , accusing President Trump of being soft on china to secure that phase one trade deal and only toughening his stance after his administration lost control of the coronavirus outbreak. So, this has become a political issue on many fronts. Rishaad whats going on with these president ial of journalists working in these press credentials of journalists working in china . Date appears to coincide with the date that 90 day visas that had been given to Chinese Press in the u. S. Will need to be renewed. Chinese authorities have delayed renewing the press credentials after some of the journalists working for American Media and outlets on the mainland. They say they are doing in response to the Trump Administration limiting those visa returns for chinese reporters in the u. S. This appears to be another one of these friction points in this clash between the two political systems. Chinas news organizations are overwhelmingly state run in the u. S. Has private news organizations that are emphasizing scrutiny of government actions. There is a disconnect there. Two australianid journalists just leave china . What is the state of relationship between the two . Jodi australias relationship with china has worsened since Prime MinisterScott Morrisons government call for independent investigators to be allowed into wuhans wet markets to try to probe to the source of the coronavirus pandemic. Lately, things have been falling apart on the number of runs between australia and china. The australian journalists based in china fled given those diplomatic relations really worsened. They were the last accredited reporters for australian media based in mainland china. There are still some australian journalists working in china for american, british and other publications. Their departure comes a week after australia revealed that a chinese born Australian Citizen who works for eight years as an anchor at a government run english language had been contained by authorities. The journalists were saying they were concerned about whether they would be able to freely work in china after this. There. Jodi Schneider coming up, japans Democratic Party served its campaign for a new leader with the chief cabinet secretary as the front runner. Details on the way next. This is bloomberg. Rishaad this is bloomberg markets. Japans Ruling Party Official started its campaign for a new leader with shinzo abes top aide, the chief cabinet secretary, seen as the front runner. This comes as we saw some poor economic news, secondquarter gdp. The contraction on its final readings worse than earlier estimated. Isabel reynolds joins us. What are the chances of a hasrise in this election or the secretary has also not . Very much shinzo abes righthand man from 2012 until the current date. We have two other contenders. The former defense minister and the former foreign minister. Bag forst likely in the him. The reason for that is the election format that the party opted for this time which is an expedited format which favors lawmakers over the rankandfile of the party. Within the lawmaker party, you have a very powerful faction. They have already decided who they will vote for. Its very unlikely, unless something very unexpected happens this week that they will see a different result. Haslinda secondquarter gdp out this morning. Contraction slightly worse than earlier estimates. What does it say about the path next . Isabel that is very grim news for japans economy. There have been some hope that perhaps it will be not as bad as initially estimated. Much emphasized he theoing to victim tbe continuity candidate. Hes also emphasized if japan sees a worsening in job statistics or bankruptcies, hes prepared to step in with more fiscal stimulus, more money to help people get through this crisis. I think hes very much looking to see what can be done if necessary in the coming months. Isabel reynolds in tokyo. A quick check of the latest business flash headlines. s hottest ipoes up i surging a record. The Water Bottle Company raised more than 1 billion from the listing. Another sign that hong kongs market is roaring ahead despite protests, the coronavirus and tensions between china and the u. S. Tosung has won 6. 6 million provide 5g wireless to the u. S. A big win for the electronic networking gear business. It is valid through the end of 2025. The biggest contracts into decided to enter the networking campus. Taking on the likes of ericsson, nokia and huawei which is now battling u. S. Sanctions. Says startal times the process of replacing the long tongue ceo who plans to step down. He led the giant through a series of takeovers as it stormed into the world largest. The head of its north american business. Going to markets in this part of the world and a bit of a turnaround story. Some of these markets are giving up the gains we had. The hang seng now down two thirds of 1 . Taking a look at whats going on. The overall asiapacific index, that too has tuirned. Its now fractionally negative. It is generally mixed. A situation where we have 18 stocks on the way. Mckay 225 comes back on stream after its lunch break and just about three or four minutes. It was up about half of 1 when we went into that. Shrugging off the Economic Data we saw earlier. Theaustralian market, deterioration of the aussie relationship with its largest trading partner, china, impacting tourism related stocks which make up half of the benchmark index. China going into its lunch break. It is negative. We have china 10 year yield at 3. 13 . Generally speaking, down arrow story. Wavering demand and geopolitical tension has oil under pressure. We will get more on the outlook for the black stuff. This is next. T. This is bloomberg. [announcer] imagine having fuller, thicker, more voluminous hair instantly. All it takes is just one session at hairclub. Introducing xtrands. Xtrands adds hundreds or even thousands of hair strands to your existing hair at the root. Theyre personalized to match your own natural hair color and texture, so theyll blend right in for a natural, effortless look. Call in the next five minutes and when you buy 500 strands, you get 500 strands free. Call right now. upbeat music haslinda almost 11 30 a. M. In singapore. In the middle of the trading day. Sti up about 2 10 of 1 . Casesore saw the virus with a resurgence. Report suggesting new clusters have appeared. At the risk of wider contagion, they say it appears to be small. Singapore back in midaugust sho ws just how challenging it is to curb the disease. The sti currently up 2 10 of 1 , rish. Rishaad ok, lets have a look at some of the first word news headlines. President trump taking another swipe at china as election rhetoric rises in the u. S. Beijing faces decoupling or massive tariffs in the u. S. American companies will be banned from winning federal contracts. China raising the stakes with reports funding could launch a global Data Initiative to counter washingtons latest restrictions on chinese tech. Pres. Trump we will end our reliance on china once and for all, whether it is decoupling or tariffs. We will impose tariffs on companies that desert america. If they cannot do it here, let them pay a big tax to build it someplace else and send it into our country. Well prohibit federal contracts from companies that outsource to china. Rishaad the last two accredited australian journalists and china have fled the country has the diplomatic relations worsens. The Australian Government says reviews and financial reporters left after police demanded interviews with the. They spent several days in the Australian Embassy in beijing before getting permission to leave. Very disappointing to have to leave under the circumstances. Im relieved to be back in the country with genuine rule of law. Yeah, this is a whirlwind. Not a good experience. Later butabout that it is good to be home. Rishaad china has been accused of delaying the renewal of press credentials for some journalists working for u. S. Media, including bloomberg, cnn, the wall street journal and getty. The applications have been processed and reporters will be able to live and work in china while that happens. The held up a seen as a countermeasure to restrictions placed on chinese reporters in the united states. Haslinda asian markets looking pretty mixed. The msci index now in negative territory. The nikkei 225 just back from lunch break. Up by 4 10 of 1 . Japans ruling Party Election starts with best for suga. Japan contracting 10. 5 annualized. The hang seng down about 1 right now. We have the leading declines. The kospi is up. Samsung is gaining. It won an order to provide 5g to verizon. This is how it is looking for tech stocks trading in hong kong. The index certainly down about 3 . Tech stocks are slumping at this point in time. Slumping seven and down 9 . Facing thatssibly blacklist, the u. S. Clamping down on Tech Companies in china. We are seeing that reeling in hong kong right now. The index is down 3 . Right, extending the retreat low 40 a barrel. Lossesket holds onto with saudi arabia reducing crude prices on demand uncertainty and the worsening of ties between the u. S. And china. Lets get more with dan. Give us the scoop. What exactly is going on . Dan it is really a demand question right now. If you take a little bit of a step back, remember back in april, may, june when prices were bottoming out, in the 20s and negative territory. Opec took these massive supply cut. The idea was they would do the supply cuts and then gradually demand would increase and they would be able to invest their supply in the market and that would return the market to balance. That works for little while, but now demand is stagnating. You have countries like india where the virus is still running rampant. Local demand is way down. They are exporting tons of fuel because people are not driving anymore. South korea, the oil demand has been stagnant. They are exporting big amounts of fuel. The demand has not been able to pick up because the virus keeps taking new hold of different markets throughout the year. Of course, transportation is key to oil demand. How much clarity do we have there . Dan we dont have much is the problem. It seems like every time you see a market like the u. S. And to resume gasoline demand then all of a sudden a new outbreak comes along and puts a pause on it. South korea, australia. Theoretically as these markets recover, as people go back to work, that will eventually increase. The question right now is one of timing, one of when. Oil traders are becoming more and more uncertain of how to survive that number or date. Rishaad the people you are talking to, what are they saying in terms of prices towards the end of the year . It did seem as though many economies are coming back but this is bringing it down. Dan it really is because up until recently, just the last couple of days, people were looking a little more bullish towards the end of the year. They were thinking that economies were coming back that these opec cuts were eating into the supply and demand and we might get a little bit of a boost. These recent weeks of put that into question. I think people are starting to look at opec, countries like kuwaiyt that are really week economically. If needed, would they be able to extend the cuts even longer . That is very questionable now. I think theres a lot of big worries about the direction oil will take for the rest of the year. In singapore. Staying on combinative. The lmg push has been denied by climate and blocked out issues. Australia was said to be the Worlds Largest exporter. Earlier, tony told us what that means for a revival in Energy Demand and a shift towards renewables. Shortterm, absolutely uncertainty. If we step out over the longerterm time horizon, the transition we are on remains the same. We see, particularly for australia, tremendous opportunity for us here. We are really wellplaced with Renewable Resources weve got. The sunshine scum of the wind blows. Winde sun shines, the lows. I think weve got the great opportunity as a nation to be able to build an Energy System, a Renewable Energy system that works for customers. One thats affordable, reliable and clean. Haidi the government has been pushing its message for a gas supplier recovery from covid19. Is that the right messaging, do you think . Some of these hurdles created by the pandemic, do they create challenges for Renewable Investment or excuses to set that back . Tony we see gas is being a really important part of the Energy System particularly today, but also into the future. It is the perfect partner for the longterm switch to renewables. The reason being when the sun is not shining or the wind is not blowing, we need to have other products. Gas provides a great partner to do that. Likewise, so does pump hydro and things like battery storage. The focus on gas and the desire is a country to make sure gas is a very Important Energy resource for us in the future is an important one and one that we support. Sophie turning to shells investment in australia. A significant amount of investment. What is attracting you to spending down under . Tony were really fortunate that we have a wonderful natural gas portfolio in this country. Our focus is on making sure that is as competitive as it possibly can be to provide that important fuel for customers globally. In addition to that, we do see the opportunity to help in the transition about Energy System to cleaner sources. What we have been doing in australia is investing in both our lmg and gas businesses, but also into power and renewables. We see that as being the future of the Energy System, but most importantly, we see that is what our customers want longterm. Sophie the Transition Towards Renewables in australia has not been without its challenges. When you compare the experience to other comparable nations, what can be done better in australia to facilitate that transition . Tony as i said before. I australia as being wellplaced because of the natural atmosphere we have here to create a Renewable Energy system that works for our customers. The most important thing is we dont bank on any one solution. It is going to require multiple solutions that can be seamlessly integrated for customers. I think whats important is for the supplyside to work closely with government, but also to work with customers to ensure all of those options are made available. That we continue to invest in future Energy Systems, but we also do it in a way that ensures it works for our customers. It has to be reliable, it has to be affordable, and it has to be clean. Haidi theres been a lot of speculation in the media that you are looking to sell off infrastructure assets related to your queensland lmg exports. Can you share with us how far along that process is . Tony there is lots of speculation around the facility for us in the plant. Im not in position to comment other than to say the project itself is a really important asset for us. I think our decision earlier this year with our partner, petro china, to continue investment in the project speaks for itself for our view of gas and queensland. Sophie so, for our viewers haidi so, for our viewers, i need to talk about the 17 billion facility that has not shipped since january. Can you give us an update on how the repairs are going and when you expect a resumption there . Tony it is a really important part of our portfolio and an important investment. It is an investment we have taken with the multidecade time horizon. We are in the process of hydrocarbon restarts. It is a process we will make sure we do right. We will make sure we do safely and we will do as long as it takes before we bring it back up again. Up, indiasing virus infections surging faster than almost other countries. Equity markets have been drawing and money. Why investors like stocks despite a collapsing economy. This is bloomberg. Haslinda indias economy may be shrinking but that is not stopping Foreign Investors from pouring money into the nations stocks. International buyers planter net 6 million into shares since august. That is as all other markets in the region excluding china suffered net withdrawals during the month. Part of it is a bet that indian equity will not play catch up after trailing the regions benchmark. Lets get insight from the investment manager. Good to have you with us. You are expecting indian stocks the play catch up but not without caution because we are still seeing surging virus cases and the worst contraction in decades as well for the economy. Yes, that is correct. We did see a significant contraction in quarter one, largely due to the most severe lockdown in india. They have continued support and money for the fourth straight huge, but india saw a outflow in march as well. Its to date, we are supported by global liquidity and low Interest Rates. Liquidity,peaking of there is also provided by the millions of local investors buying into local shares. Correct. During this pandemic, we saw a lot of region participation that continues coming into the market. August there were net sellers. Continues. Pation haslinda we have fresh confrontations between china and india at the border, following months of downdraft. Im wondering how much a visit weighing on sentiment in india . How closely are you watching that . Watched closely. We did see the markets be kind of contracting in the last two or three sessions. It is being watched. And it will be closely watched. But, there are so many other concerns. Aspects also a lot of within the different sectors that are improving. July, even after the lockdown with the opening of the which asserts demand recovery and supply recovery. A lot of variables are there that are working against each other in the markets during this time. Haslinda the market opened in india, we are looking at red across the board. The hang seng down. Flat. Fty 100 is in terms of sectors, what are your thoughts on india . How much clarity do you have in terms of prospects in the sector . The Resolution Plan came out yesterday, the Resolution Plan which is talk about how 26 relief inll get this all the issues they have faced during this moratorium period of six months. Real estate is also improving. We get some relief because of this plan. Besides that, banks, as weve had six months, we will only know the outcome of that over the next two or three quarters. What kind of pickup will happen by the end of the year. Rishaad how bad are things economically and are you worried . Did have a severe contraction in quarter one but since the opening up in june, joan, july and august, we have seen a lot of supplyside factors improving and coming to near normal levels since the precovid levels. Unemployment has also improved. We are seeing that at precovid levels around 8 . On the supply side, while things there alsoup, recovery in pockets. Different sectors are seeing different types of demand. Demand and autos have come back. Sales advertising and now picking up. Consumer durable sales are continuing. There is a factory recovery on the demand side but things are improving, for sure. Rishaad unemployment seems ridiculously high. The rural side of things perhaps a monsoonhanks to this year but it is not enough. Agriculture cannot lift its economy out of the quagmire. Rakhi thats correct. We can seeift it but the breakup of quarter one contraction. We see the Government Spending continue. Imports were much lower which to spenrnment continues d. Enterprises will continue to do business. Infrastructure is a big push by the government. When they start kicking it out, it will have high multiplier effects in terms of recovery. Were hoping that the government does put in some kind of demand stimulus which has been daunting in india. Absolutely, the government could be doing more. Many people suggesting that. Ins the rbi all it can d your view . As you have noticed over the last couple of weeks, rbi has been a little bit relaxed in terms of the foreign currency exchange. Floflows wanting to come in and ease the inflation on Petroleum Diesel side. Better will be a little in terms of pricing for diesel with the economy picking up. May also, depending on how inflation, the cpi inflation moves, may want to look at the Interest Rates at some point in time, providing relief to borrowers. Rishaad all right, thank you so much. Coming up, were going to take you to the movies. Find out why. This is bloomberg. Rishaad hollywoods first big test in the age of the pandemics all mixed results. Christopher nolans film made 20 million in the u. S. With the markets of california and new york still shuttered. It made over 120 million in two weeks, including 30 million from chinas opening weekend. We spoke with Timothy Richards about cinemas getting back to normal. We have different social distancing laws in each country but on average, we are filling up about 50 of our seats and we have a geographical social distancing, 50 . I think its important to remember as an industry, globally, we typically have 20 to 30 occupancy rates at any event. Weve always had excess capacity. So, the actual social distancing laws have not really affected us at all. What is your main concern Going Forward . If theres not a vaccine, what countries where your operations are present will be at risk . Timothy i think looking forward right now, we are going to be living, until theres a vaccine, we are going to be living in a world of hotspots. Hotspots are going to come up and we have seen that all across our markets. We have been seeing that now for the six weeks we have been opened in europe. We are going to become as a society, we are going to become faster, quicker, more adept at jumping on those hotspots. Tracing, testing. And i think theres a chance we might lose one or two cinemas in those hotspots in different markets. We might lose bond. We might lose part of northern milan. I dont see a situation anymore where we have full lockdown. I think huge credit to warner bros. And Christopher Nolan for really having the kind of vision to move away from what had been the norm, a global release of movies and looking at monetizing where they can. Yes, Different Countries have come into this epidemic and are coming out of it at different times. The u. S. Right now is a little behind other parts of the world. Warner bros. And now they are for another studios are looking seeing 70 or 80 of the screens that are not open. They are jumping at that opportunity. And on the basis that several weeks later, they will be able to then release the movie in the market as they open up which is really the plan with tenet. Tenet had a roll out a week or two later than it did internationally. Ofhaad that was the view the entertainment industry. Standard chartered being fined more than 13 million but indias antimoney laundering industry for breaking foreignexchange rules when it worked on the local bank. The biggest ever imposed that an overseas lender. The investigation related to an International Transfer of shares without the permission of the central bank. Jp morgan doublea the number of Investment Bankers coming to its new york and london offices, inching back to prepandemic work arrangements. The banking giant wants 50 of its dealmakers to be at their desk in any given day, up from 25 . Jp morgan staff will be allowed to work from home one week on, one week off. Lets get to the markets. The hang seng headed towards lunch break. Tech stocks responsible for this turnaround taking place. Tencent, 1. 5 down. 39 points off index. , taking 77s down points off the market. This is the debutante of the day. SpringWater Company coming in at a 53. 5 gain on its debut. Turnaround story taking place. Lets show you something not to miss later. The german finance minister will be joining bloombergs Francine Lacqua to discuss the eus economic recovery amid the pandemic. 2 p. M. London time, 9 00 p. M. Hong kong. Look here, its your very own allinone Entertainment Experience xfinity x1. Its the easiest way to watch live tv and all your favorite streaming apps. Plus, x1 also includes peacock premium at no extra cost. This baby is the total package. It streams exclusive originals, the full peacock movie library, complete collections of iconic tv shows, and more. Yup, the best really did get better. Magnificent. Xfinity x1 just got even better, with peacock premium included at no additional cost. No strings attached. Manus this is bloomberg daybreak middle east. President trump sharpens his rhetoric against china, saying u. S. Investors repair to return after Labor Day Holiday focused on whether the tech rally is fizzling out following