Transcripts For BLOOMBERG Bloomberg 20240704

York and hong kong. The tough story this is hour. Investors await caution ahead of china inflation. Bloomberg has learned that the u. S. Is set to limit the scope of the ban on investment in Chinese Companies as it seeks to covert the damage to relations with beijing. Plus, we get the main line business and Economic Outlook speaking exclusively with the d. B. S. We have the jobless rate for the month of july coming in at 2. 8 . This is higher than the previous month of june 2. 6 . Its higher rate than economists have expected. We did have heavy rain since mid july. Also weak growth. Still, you have to put it into context. The 10year average for the jobless rate in korea has been 3. 6 . Post pandemic average has been 3. 4 . So yes, its a rise in the jobless rate to 2. 8 . But its still a resilient jobs number. And something that will make the bank of korea give more grounds for keeping as Monetary Policy when it decides on rates later this month. Annabelle. Alongside tokyo and sidney. But the day is going to be focused on other econews. Thats going to be out of china because weve got the Inflation Numbers dropping in about two and a half hours. The one word to watch out of the c. P. I. Will be deflation. In terms of what were seeing in futures today. We are looking for a weaker setup. We had that leadup from the u. S. Session. Stocks recouping some of their losses at the end of the day. Theres a couple of stocks in focus ahead of the session today. Were going to be watching in particular. Firstly, the soft bank. We did have ternings out. And we did see the vision fund which had seen five straight quarters of losses posting a small profit in the period really led by that a. I. Boom, that rally thats lifted the valuation of portfolio companies. Just in the last half hours, reuters reporting that amazon is in talks to be an anchor investor in the i. P. O. Which could raise 10 billion when it lists as soon as accept. The likes of alphabet and nividia could be anchor investors in that. This is australias largest lender reported earnings this morning and showing a profit there. The c. E. O. , shery, a little bit cautious about the outlook. Do keep an eye on those stocks. Take a lock at how u. S. Futures are trading unchanged at the moment. After we saw a lot of fluctuation, the s p fell but compare that to more than 1 . Of course, we have plenty of fed speak to digest not to mention the lenders were down today. Were talking about the b. Bkwx they warned about other six major firms. We were watching the treasury space. Haven demand gain ground, but the 10year fell at the level. We had to keep an eye of the options of 100 billion of bond sales this week and how that market digests all of those offers. Take a look at oil prices right now are curving some of that upside we saw in the new york session. We were higher on wall street hiding given that we have more russia and ukraine tensions. Were losing about. 2 of 1 at the moment. One of the stories were following, shery, bloomberg learning that the u. S. Plans to restrict investments in china the ones from cutting edge sectors. Things like quantum computing, artificial intelligence. Lets get the details from economics reporter eric martins who joins us out of washington. What did we learn about how this order could potentially be structured . What were hearing from our sources is that this order is going to be narrow in scope. Thats something that secretary of Treasury Janet Yellen high right highlighted last month. Companies get a certain percentage of their revenue from some of thisness active capabilities such as quantum computing the most advantagessed semiconductors of artificial intelligence. This has been structured in such a way that it wouldnt affect the very biggest conglomerates that are out there. But it would affect smaller startups that are trying to be on the leading edge of chinas Technological Development and matching usa capabilities. Eric, what does it mean for u. S. China relations . This is from what weve seen in the recent weeks, this has been scaled back a bit from what some people in the private sector originally thought we might see in terms of an Outbound Investment screening or prohibition regime. Were seeing that the prohibitions apply to military end users thats to technology that goes to the chinese army. And that can be used in the most direct way to threaten u. S. National secure. And weve seen certain areas such as biotechnology and energy that had been left out of this executive order that were expecting to be announced in the coming days. So this is narrowly targeted. And its the first time that the u. S. Has tried to do this, to scream what kind of investments you ask Capital Investors are making in china. But its something that will be a bit easier to to try to regulate and to monitor than some of the earlier sweeping expectation that there has been for this kind of a program. Economics reporter eric martin there joining us from washington. Get yo political tensions have been a one factor really pressuring the chinese campaign. One day after that reported their worse drops since the early days of the pandemic. New data shows denation taking hold. Our policy editors catheline hayes is here with the latest. What kind of numbers should we be expecting on cpi and ppi. Something with a minus shot. Its got to be distressing to the governor has very targeted kinds of stimulus at a time when demand was weak. When the Manufacturing Sector has been set by 15 year after year. We havent seen numbers like that since february of 2026. C. P. I. Down minus. 04 . It was flat the previous month. The first subzero in february 20201. Consumer good and again, people came out of the pandemic. Theyre supposed to come out. They are not confident now. And if you look at the p. I. I. , its supposed to be. 0 year after year. Maybe, thats a little less bad. Here youre getting the Manufacturing Sector this week, youve got weak exports and week Commodity Prices. Factory gate, commodities controlled a lot by a Global Economy if europe continues to slow, if u. S. Continues to slow . What if theres a recession . Those are the kind of things that they should look at. Investors are invading. In terms of the two fed Bank President s we heard from today, what was the division there . To me, haidi, its one person that the fell have bun have. And the other one is saying i just have to see more data end of september meeting. So lets talk with tom barkman. Ry monday fed. What struck me is that the economy still looks strong. The latest tracking index for g. D. P. Is suggesting that in the Third Quarter, g. D. P. Could be over 4 . Think about that while you look at him also say inflation remains too strong. Lets listen to his remarks today. Inflation does remain too high. Theres still applausable story that inflation organizes in short order. Theres a lot of talk about the potential for what is often called a soft landing. Certainly lasts month was a good one. And i hope its a sign. To be hour, the feds objective and to reduce it in line with our mandate. I think a big thing. Those are prepared remarks. Those are things he meant to say, meant to communicate. Now, patrick harker, president of the philly fed and has been quite clear speaking a lot lately that he thinks the fed probably has done enough. Hes not convinced of the soft landing. He said he does think its possible to get there. And he thinks maybe the fed has done enough. So hes the one hes seeming to argue that he thinks at this point there are be a pause. He also talked about, hey, once we pause were going to have to stay there a while. If everything comes in as expect t. Thats a pretty big f isnt it . Such a big f for just about every economy. Catheline hayes. The bank of japan lose its grip has traders betting there the federal policy will helped in as little as eight months. Lets talk to tara kamur irv a. It sort of feels like it is a lot of the equities is perhaps. Programs we might have more runway than we might think . Right. Thanks for having me. Actually the biggest change in terms of the messengering and policy stands of the b. O. J. Is they start to alert. They start to be alert to the upside risks to inflation. Thats why they explained that the tweak is a kind of preemptive measure in order to relearn if theres a positive development and inflation. En and expectation. And thats understandable. And the thing is that inflation in japan is getting harder to predict not only for the b. O. J. But the economies as well. The tokyo c. P. I. Which came out on the exact day of the b. O. J. s decision overshoot and g. O. D. Is huge. Probably they have to worry about some other different factors playing the game. Therefore, i would say depending on the early development, the early people are getting prople. What does that say about the d. O. J. s event . They sent a message that they want to skip the stimulus. This is a message that they dont along to go straight up to. 0 ceiling. Their message is for outside risks. But the baseline thats pessimistic shooting 2 pick. And their message has been they still think that they need to keep stimulus by purchasing, bond or restraining and longterm heal, where do we see the yen going from here, then . Actually, given that the b. O. J. Is restraining the longterm yield and like, you know, the yield is not moving like upside down or slightly getting slower compared to the last week. I think its going to be depending on the u. S. Yield. I personally think that that that the dollar yen will hover right this rate. The first around 140 or Something Like that. Bloomberg senior japan analyst, daniel i can murrah. Well speak to ginner later in the hour. We talk Market Strategies next. This is bloomberg wealthchanging question are you keeping as much of your investment gains as possible . High taxes can erode returns quickly, so you need a taxoptimized portfolio. At creative planning, our Money Managers and specialists Work Together to make sure your portfolio and wealth are managed in a taxefficient manner. Its what you keep that really matters. Why not give your wealth a second look . Book your free meeting today at creativeplanning. Com. Creative planning a richer way to wealth. 76 of 23andme Health Customers surveyed reported taking healthier actions. Book your free meeting today at creativeplanning. Com. Because they know health isnt just a future state. Health happens now. Start your dnapowered Health Journey today with personalized insights from 23andme. The soft landing is quite plausible. And its quite possible at this point. Now, things could happen, you know, another tragic move by putin and ukraine could cause incredible pain and an distinguish. It could take a big toll on the academy. But god forbid that happens. Think we can get back there. President Patrick Harper about the u. S. Soft landing. The biggest risk facing markets is stag frustration in. Lets bring in the founder and investment manager and alphas future. Great to have you with us. I mean, the rally that weve seen in equity marks has been so relentless. Whats the risk in narrative, in market direction especially when we have u. S. C. P. I. Number as well i think a lot of it is driven by normalizing and normalizing inflation. Weve seen Inflation Numbers come down quite a bit this year. I think on an income bases we might model c. P. I. On friday we will get the p. P. I. In the u. S. Be will continue to see inflation coming down stable in line with expectations. I think more medium to longer determine, the digesting is the resurgence of refor about three months. Other Commodity Prices start to go up again. And that can drive again drive the headline inflation higher. We have seen code inflation be quite sticky in the u. S. And they continue to rise above 4 . They continue to put inflation risks up there. So how would you pox more defensively in this environment especially when he comes to the different sectors. Yeah, i think weve been looking at the volume volatility factor. It has under per formed the s p by over 20 this year think thats a very sharp, very strong under performance. Its been driven by normalizing environment and fedeasing policy. I think a shift in that will drive markets drive a bit of selloff in the markets and low volumityity can be ahead in that environment. I think its time to start looking at that. And in terms of sector that is would include healthcare which is very strong, economic, attractively prized. Which can be an inflation hack. When you take a look at the commodities and the risk for inflation, is there a way that you would want to get get get exposure for that type of inflation . Yeah, commodities is the by to go if you are expecting inflation to rise, then would wow look at some of the commodities. I think for investors the challenge is that it does expose you to some impact on volume you see a huge boost in the country mike in china that would be great. But defensive sectors could role as a hedge as well. Youve expressed caution when it comes to the big driver of this years rally so far which of course, has been air i. If you look at the longterm prom situation is there better ways to be constructive on that . I think a. I. Is definitely a strong mega trend. But what youve been hearing from campaigns right now is that they need to to make move investments and tools and products et. And of course, how theyre going to monetize that. So not really highlight, sharp improvement in sales in profits. As it is out of a. I. And that can be an hes drap in many of these expects. Lakely, you know, campaigns that have talked about a. I. And foreearnings, many of them have got. 30, 40. You expect a strong sales growth. If some of that is getting delayed then that would be a concern in the markets, i would think. How much are you factors in political risk. But at the same time we have cons having left for extend reasons. Reasons . I think the particular area creates volumityity in the markets. And we do not have a longterm impact. But i do think that the ground rate has gone for deficit and high deck held by the new government and new bodies what they need to do. Weve seen that play out in terms of hired tenured yields. And that, of course, drives the cost of capital higher. I think from a corporate earnings investment stand point high yields is especially longterm yelled em is negative. Especially longer so that if they see you going any higher, i they that would be negative for some of the technology that have done that this year. Well see how the treasury markets digest that their 100 million onwave of options. For very much for joining us today. Shes gitu sharma manager of alphas future. You can get a roundup of this days story. Go to day be go. You can customize your settings. So you only get the news in the industries in the assets that you care about. This is bloomberg. Fabulous surroundings. But everyones looking at their phones for Financial Insights from merrill. Is he hailing a ride to the concert hall . No. Hes making sure his portfolio and retirement plans work in harmony. They want to adopt a child and build a new home. So theyre talking numbers with their merrill adviser. Shes not researching her next role. Shes learning how to handle market ups and downs without the drama. Personalized advice so impressive your money never stops working for you with merrill. A bank of america company. Take a look at these big moves in the session left plunging 6 left the slowest growth since the pandemic leaving investors to be a little bit spooked and overshadowed that better than expected. And raising. V. Production guidance. But investors are trying to decide what to expect given that they do see heavy losses to continue as the Company Boosts production. Wework plunging. They have sustained loss and canceled membership. This office where the company has struggled for the past few years. Cow pon, the south korean Ecommerce Company posting its straight quarterly profit after logistics an membership programs. You have the stock gaining almost 6 . We have more to come on daybreak asia. This is bloomberg. Wow, you get to watch all your favorite stuff. Its to die for. And its all right here. Streaming was never this easy, you know. This is the way. You really went all out didnt you . Um, its called commitment. Could you turn down the volume . Here, you can try. Get way more into what your into when you stream on the xfinity 10g network. Hi, im jason and ive lost 202 pounds on golo. So the first time i ever seen a golo advertisement, i said, yeah, whatever. Theres no way this works like this. And threw it to the side. A couple weeks later, i seen it again after getting not so pleasant news from my physician. I was 424 pounds, and my doctor was recommending weight loss surgery. To avoid the surgery, i had to make a change. So i decided to go with golo and its changed my life. When i first started golo and taking release, my cravings, they went away. And i was so surprised. You feel that your body is working and functioning the way it should be and you feel energized. Golo has improved my life in so many ways. Im able to stand and actually make dinner. Im able to clean my house. Im able to do just simple tasks that a lot of people call simple, but when youre extremely heavy theyre not so simple. Golo is real and when you take release and follow the plan, it works. Youre watching daybreak asia. Im annabelle drillers Annabelle Droulers with key Investment Opportunities today. A lot of different headlights a cover, geopolitical tensions that we spoke about at the hour, inflation in just a moment, but also the issues in the property sector. We will be watching for any updates that we get around Country Garden in particular. This is one of chinas biggest Property Developers by sales, largest sixth largest. But a key headline in the drop yesterday is that we understand bondholders did not receive coupon payments due on monday. They were supposed to be paying interest repayments worth just shy of 23 million on monday, two different fonts and focused. Bondholders say they have not received some of those. The company is yet to fully acknowledge this, but they did say that they are expressing liquidity stresses, and even without that we did see them slumping in the intraday session. Those concerns around the property sector are feeding across to other developers in the session, and china futures are looking weaker ahead of the sessions. Property stress is one, and the other factor is Inflation Numbers that we have been counting down to across the course of this week. Changing over now, this ppi is already in deflation, and Consumer Prices could show deflation for the First Time Since 2021. Were looking at the range of cpi forecasts, and you can see most economists in the survey for bloomberg indicate that we will see deflation from. Deflation. The median is a drop of 1. 4 on the year. If we get below. 5 , you are looking at the highest rate of deflation since the Global Financial crisis. Chinas foundering economic recovery dominate discussions at the bay area conference which gets underway in shenzhen today. Speaking to us exclusively is the ceo of a major bank. Ginger chang. Optimistic are you about the recovery, and what is your outlook . How optimistic are you about the recovery and what is your outlook . Thank you for having me. We know that there are a lot of headwinds,s particularly headwinds, particularly with the numbers yesterday. The external challenges, from both europe and the u. S. Are still weak, but we have to emerging opportunities we are looking at, especially for example, the renewables, the Energy Transition related ones. When you look at the trade export data, those related to electronic vehicles, solar panels and batteries are encouraging. We continue to look at localization, localization, and we think that nasa consumption will be a major driver of consumption will be a major driver of growth for china this year. Rexford dbs, the Mainland China business is relatively small in terms of the big contracts the Mainland China business focus is relatively small in terms of the big contracts. What is the focus going for the next few years . At dbs you look at the china franchise as a whole, not just the [no audio] we seem to have lost her. We want to check that you can hear me. You were talking about your strategy at the outlook for the Chinese Business. Are you able to weigh in there . It looks like we are having technical difficulties. We will have a lot more in terms of these conversations from the dbs greater bay conference, we have exclusive interviews with their north asia president , and their Institutional Banking head, speaking as well to charles lee about the firms firms newest funding round. The goldman president and ceo are sticking to china and they say that the country is not going back to where it was after falling trade prices on copper. They expect to change the business by the end of the decade. We should be 30 of our business, that will be copper by the end of the decade. It might be very much more on the bottom line, because, you know, of the copper price. Copper is going to run out, you believe in the forecast. If you believe in the forecast. And i do. It sounds like in the transition you have a lot of copper. It was pretty dismal trade data out of china, with copper taking a hit. What is your take on that . The point is that we are not going to see china go back to where it was. It is a very big component of the Global Economy, it is a consumer of all metals, but we have to be reminded by the fact that if we get a bolder want a bolder and better world we need to invest in developments. Copper is the most strategic of all metals. Whatever you do. If you want to create bold industrializations, more modern and more user free friendly ways, copper is a key metal and we dont have enough of it to fund, in our minds today. That is really important. What we have, ill come back to your first question soon, but what we have is real organic growth. We are looking to gold our gold equivalent, including copper by 25 by the end of the decade. Barry gold president there. Coming up next, the Group Vision Fund is making invest investments again, timidly and with fear, how they are capitalizing on opportunities in ai and other technologies next. This is bloomberg. The first time your sales reached 100k with godaddy was also the first time your profits left you speechless. At the counter or on the go, save 20 with the lowest transaction fees and keep more of what you make. Start saving today at godaddy. Com sales tax automatically. Avalarahhhhhh what if tax rates change . Ahhhhhh filing sales tax returns . Ahhhhhh business license guidance . Ahhhhhh crossborder sales . Ahhhhhh item classification . Ahhhhhh does it connect with acc. . Ahhhhhh ahhhhhh ahhhhhh 76 of 23andme Health Customers surveyed reported taking healthier actions. Ahhhhhh because they know health isnt just a future state. Health happens now. Start your dnapowered Health Journey today with personalized insights from 23andme. Australias profit climbed next to higher Interest Rates and a cooling housing market, and we are joined from sydney by an official from the commonwealth bank. What is your take on the outlook that we heard . Great to be on. Look. I think people are focused on margin and loan growth coming in, but the dividend and the buyback where the story. The one billiondollar buyback could have been a bigger story. They had so much surplus capital. And the dividend payoffs have at 74 were nowhere near 80 . I think they telegraphed their punches, they had impairments because of rising Interest Rates around home loans and that fixed line. I think that they are keeping their powder dry and that is a disappointing outlook. Inflation is running hot in australia. What does this mean for the cost outlook for the cba . Thank you for that. A lot of their peers have big upticks in salaries for bank staff and that is the case at cba as well. Costs jumped 5 and costs are up 6 which will continue. I think those are going to jump again next year and that is going to hurt the ratios, given that high level of inflation. But also, this baked in cost growth now after what we have seen over the last year or so. There has been a lot about margins and competition. How do they actually do it . It was better than expected, there were other banks that reported earlier that had big margin hits. Cba was only five pips down. The important part of that was maintaining market share, and that was propped up by big growth in business lending. This is the test plays to benefit from those high levels of rba rates, but also higher swap rates. Also dealing with positive, edition as well. The they have done very well maintaining that market share. Met ingram there. Lets get to other stories that we are tracking. Amazon said to be in talks about joining other Tech Companies as an anchor investor in arms ipo, expected to raise as much as 10 billion. One source says that amazon is one of 10 Tech Companies in talks with intel, alphabet and nvidia, also among potential investors. The chip designer could list as soon as early next month. Tsmc has agreed to build an 11 billiondollar plant in eastern germany with partnership with semiconductor companies. This is their first step in establishing a major european presence to counter risks from escalating u. S. Chinese tensions. They will own 70 of the plant fabricator psm c will own 70 percent of the plant fabrication, and own a 10 equity stake subject to regulatory approval. Nvidia announced an update on ad processors which gives a jolt the ships capacity and speed, seeking to cement the companys dominance in the burgeoning market. They say that the super chip, a combination of graphics, chip and processor, could access information at five terabytes per second. They have built an early lead in the market for ai chips, helping them propel their valuations past 1 trillion this year. Lets bring back dbs china ceo ginger, thank you for sticking around with us to this technical difficult use. What we were talking about before, in terms of the strategy in china, are you looking at expanding franchises . Yes, we are definitely increasing investment in china. Two years ago we set up a security company, majority owned by dbs group, and we also strategically invested in a commercial bank, had this year we will continue to strengthen our industry coverage of key industries, including, but not limited to, auto, ev consumption related industries. Health care. Etc. We will also continue to strengthen our gba, we are having the gba conference today, and we are getting a good market share in terms of gba bonds. We are continuing to strengthen the connectivity with our partners in china and hopefully to further strengthen this year. Lets talk about chinas links with the rest of the world. The leadership has tried to really internationalize the usage of the yuan, especially when it comes to trade settlements. What do you see in terms of usage across asia . I think that the usage increase very significantly in the past year, because dds china is the major player of and we see an increased volume of zips in our sentiment, and especially in the middle east and asia, and central banks. I think that it is critical that we could further use the rmb for the trade, especially for the region. I think our station had a very good chance within china and with that for for an extent, the middle east. We have seen that plunge in investment in china as a reflection of that anxiety, really down when it comes to china when it comes to foreign investors. What are you seeing from client . Clients. Are mostly our multinational clients continue to invest in china as the major market, in which they are still extending. I think for chinese corporate, they have ai investing, particularly in Technology Related areas. For fbi, i think this year we will continue to see fbi, i think we will continue to see investment from certain industries, especially on the ginger, when it comes to the cost perspective, what has been the evidence that you have seen given the higher inflationary environment . [no audio] for china, i think the hyperinflation is not a very big issue, but so, i think that it isnt an issue for our clients. Ginger, great to have you with us. The dbs china ceo there. More to come here on daybreak asia, this is bloomberg. Did you know you can get someone to shop for you . 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This is a set up that flags more pain ahead for equity futures, not to mention currencies trading as it proxy to that China Economic weakness story, futures down. 1 , we saw broad weakness as a reaction to those trade numbers out of china, and of course, the cpi numbers are not going to be ready. In fact we are all but certain that we will see signs of deflation and end the day with china having the highest inflation in the world. Kiwi stocks down. 1 , and nikkei futures pretty weak. The s p futures flat at the moment. The Consumer Price data expected to show ongoing weakness fractionally lower across the board it comes to the future session. We did already see the reaction in the cash session yesterday when it comes to chinese stocks trainings in hong kong, just such a big tumble to the lowest in about two weeks. And potentially, we are bracing for a repeat or an extension of that selloff today, depending on those numbers. We will be watching softbank at the opening in tokyo, its vision fun has eked out its first profit in more than a year and says it is cautiously resuming investments to capitalize in opportunities in ai and other emerging tech. Lets bring in Technology Editor, mayumi. How did they do, especially when it comes to the it for vision fund and investment . They did say that we were waiting for over a year for the softbank vision fund, this mammoth investment force, to begin resuming in venture capital. It has been a long time. They did they actually invested 1. 6 billion in june, the first time in about a year that they have started to invest in new investments. But it is still a faint shadow of its former self. We were looking at whether softbank was ready to really become the aggressive sort of goliath in the start of sector again. But the cfo said that they are not investing and that they were not doing their job, at the same time that they were very fearful, they had much fear in their hearts, as they proceed. Just to give the tone of their investment. They have been burned so badly since the vision fund and the pandemic hit. And the tech crackdown in type china. They are still climbing up. The burned hand learns best. We will have to see how aggressive they are. One of the investments that was really bad was reworked, which has raised substantial doubt about ability to operate considering its earnings, what is behind this, and how does that feed into the future for softbank and the vision fund . Does that have an impact for bankruptcy . Thats basically epitomizing, becoming the poster child of the vision fund now. Softbank put more than 140 billion into unprofitable startups that did not have the bandwidth to spend all that money. Lifting valuations. And rework is one of those examples. Its valuation hit a peak of 47 billion, not that long ago, and now, we are talking about a growing concern. After question about it, they were very frank and they said they were stupid and it was their mistake. It is clear from reporting that many people in softbank proper were actually quite against them supporting we work at the time. It also shows that they were hesitant about taking so much money from softbank, but the ceo really emphasize that you could dream bigger and that this could scale up and be a dream factory. It really is there are wonderful things about the Softbank Ceos optimism in tech and his strong faith in the future of technology and what it can do for humanity. I think that alibaba, his early 20 million bet has paid thousands for as an example of that. But the downside is that is that too much optimism can hurt, and has a price. Our Technology Editor my you may make issue here mayumi there. We have seen substantial doubts about their down to continue ability to continue operating. It was a difficult session in new york. They finished off session lows, but we had bargainhunting at the end of the day. The s p 500 at one point lost more than 1 . There was plenty of fed speak to digest, not only from the fed governors signaling that rates could remain high for longer, but we heard from the likes of Thomas Barclay and patrick harker, and we are trying to figure out where the hit fed is going as we get the cpi numbers on thursday. Not to mention, moodys lowering ratings sent the Kbw Bank Index to the worst date in two weeks. And that haven demand leading to bonds gaining ground. We saw a bit of a rebound in the new york session on rushing ukraine tensions, we will continue to watch the Energy Sector as we see the market open in sydney, sale seoul and tokyo. This is bloomberg. Oh, oh, oh. Ill be the judge of that. Oh, thats nice. Oh searchable, verified reviews. 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The likes of c group saying that this program pullback that we see is orderly and could set up for for the gains ahead. Deutsche bank and others saying that the s p 500 could hit 5000 by the end of the year. The opening is on us for japan, korea, and australia, and ahead there are couple different stocks we are going to be watching closely, because we are in the midst of earnings here in asia. And we do have softbank, the key one that were watching here as we get trading underway into tokyo. It is coming online and it is trading fractionally higher in the session, but importantly, it focuses very much on softbanks vision fund. We had seen that reporting five straight quarters of losses, its just up to a small profit in the latest report in. Reporting stretch. Theres also optimism around ai which lifted the value of its portfolio companies. We are watching for softbank today with another key headline that crossed earlier, this relates to the listing of the chip designer that they are hoping to raise around 10 billion for. The key headline is that amazon could be in talks to be an anchor investor in this for the initial public offering, according to sources familiar with the matter. Its not just amazon. Other companies are looking to be invested in this at this stage. We have in korea, we have the nikkei reporting that apple and samsung could be another one looking to invest. There is a chip this is a chip designer that counts some of its biggest tech firms as its clients. In korea, we have that focus on ecodata, the adjusted jobless rate rising to 2. 8 , but the unemployed rate sitting at a six month high. So were going to be looking at that closely to determine whether to continue pausing the be ok, one of the central banks, has started to cut rates in asia. Lets change over to the asx 200, we are going to be watching banks at the start of todays trading, but thats not online. We will also start tracking brent crude, holding near eight four month high for wti, and u. S. Stockpiles are gaining come up with investors very much focused on escalating tensions in russia and ukraine in the black sea, but cba is coming online, and we have stopped starting to trade. This is australias largest lender, lets see it come online after reporting earnings earlier, showing a return to further profit gains rather than for the full year, but the ceo is quite cautious here on the broader outlook. You can see its up more than 2 . Sounding a little bit more measured for the. The time Going Forward. Lets bring in our asian chief market strategist, here in the hong kong city. Great to see you. We appreciate your. What are some currents that investors have to contend with . The key is that a lot of the key themes that we had in the beginning of the year have yet to play out, a slowdown in the u. S. Economy, and recovery in china, and the peak of the Interest Rate cycle, we do think that we are approaching the end, and i think we have reached that point for Asian Central banks. I think it is a bit more there needs to be more patient patience for a rollover and moderation. Hopefully we see more specific seamless coming through from china which will help markets and product asian markets dependent on chinese economies. So, if youre patient, with your positioning in your portfolio finally coming to fruition, what does that look like . We put a lot of emphasis on fixed income because you do generate income while you wait. You look at equities, we do think that a globally diversified portfolio of develop markets and emerging markets make sense, but from an equity fixed income perspective, we still think fixed income has a lot to offer up, especially with the treasury market catching up a little bit as we approach the peak of the hiking cycle. This does call for a really Good Opportunity to lock in highrisk government bonds or even further down, credit rating, whether in investment grades, even into the market in the u. S. We will start with fixed income markets, and look into equities by markets as well as sectors. Japanese equities have been favored by investors lately, but what does it mean when you have that in the back of the yield curve control program . I think its quite limited for the japanese market as of now. A lot of the rally that we have seen in japan is for two reasons. The macro the Macro Economic recovery in japan as a result of coming out of covid, but also corporate governor changes that we have seen accelerated in the last 612 months have added momentum. If you look at what we are seeing in japan this year, it is more of a rally rather than a growth rally. Even if the boj does tweak policy, i think that will curb enthusiasm in the market for now. As for when the japanese economy continues to gather momentum, we might want to start focusing a bit more on the growth sectors where Japanese Companies have a very Strong International competitiveness and strong intellectual properties which can benefit from eventual recovery of the Global Economy, perhaps in 2024. At that 143 level for the japanese yen, what happens when you see it stronger . The traditional thing that means stronger yen means is that core inflation has weakened significantly. Last year, when the yen weakened against the u. S. Dollar, that did not benefit the japanese market. I think from that perspective, yes. Traditionally, you would think that the stronger yen could hurt exporters revenue, but the reality is there is a lot of domestic mental driving equity markets right now. A lot of people were saying japan could be an alternative for investors who are comfortable with china. What do you say to that . I do think that there are some very good options in china at this point. A lot of the bad news is already factored into the price. I do agree in terms of geopolitics there is less resistance when it comes to japan or even india where a lot of International Investors might feel more at this point. From my perspective, i do focus more on the Companies Rather than just geopolitics, which is always changing. From that perspective, Corporate Governance has improved, this is a very Worthy Investment theme, but the growth of opportunities in technology and health care and consumers where japanese countries have a really strong Global Presence are positions that should be revisited. Japan has always been somewhat neglected and underresearched by investors in the past. The Chinese Consumer has been relatively resilient. Are you worried about a deflationary mindset setting in with a slope, eventual fixed of the Property Market . When you look at Chinese Consumer spending, they are happy to spend on restaurants and going out and holidays, but they are more wary about bigticket items like property. I think that the expectation of where property prices will go it is is playing a huge role. When we look at the deflationary dynamics, it is not that consumers cannot or wont spend, but where they are spending. So its important to dissect some of the deflationary momentums coming into the Property Market, playing a huge role there, but some of the more daytoday Consumer Spending in those areas are in pretty good shape, especially when you see more government policy coming in, stimulating the economy. Great to see you, the chief asian market correlator at j. P. Morgan. Now, a tale of two reactions on the market. Southbank under pressure as we get trading underway for tokyo, but this is investors his first chance to react to headlines commercial investors first chance to react to headlines coming through. A first returned to profit for softbank here, boosted by that investor enthusiasm that we have seen for ai, tech broadly lifting the value apart flu companies, but southbank itself says that it is returning to making investments, but in eight to midmanner, in the words of the company. In a to mid manner, in the words of the committee. They are not making anywhere near what they had made in the past investing 1. 6 billion in the june quarter after it had come to a virtual halt. The other thing is that we do understand amazon is in talks to become an anchor investor in the arm ipo, along with other Companies Including samsung and apple, reported by the nikkei as well. Australias biggest lender is reporting earnings earlier, we saw those climbed earlier and the ceo is cautious about the outlook, but australian lenders have really gained from a rising rate environment. We have seen strong important, and the property sector remains robust. Lets change on, because another group of stock lenders is still in focus here, and we are seeing declines across the board, particularly in japan and korea as trading gets underway. That follows the moves that we have seen in the u. S. Session overnight, the story that moodys cut ratings for several smallmidsize lenders in the nation, and downgraded major firms. But the bank index is down more than 1 at the close of wall street. Changing on, because the other group of stocks, these are interesting, we have been marking them, some mixed moves at the start, these are superconductors stocks and korea. And korea. Superconductor Technology Talks about transmitting energy with almost zero resistance. If this technology could do that at room to mature that would reshape the energy industry. There has been a lot of enthusiasm for these stocks claiming that it could be a technology achieved, or superconducting the achieved at Room Temperature is only being , it is only being done at colton pictures are at high pressure, and we have pressures pouring down on these claims. We are seeing these stocks slipped, scientists now under pressure to validate those findings as soon as possible. We will speak be speaking to the head of dbs north asia after the conference returns to shenzhen. But then we learned about plans to restrict investments in china, telling us about the scope and position provisions of the order and what it could look like. That is next. This is bloomberg. Like changing tax rates, exemption certificates or filing returns. AvalarAhhh Ahhh Ahhh ahhh upbeat music woah. Constant Contact delivers the Marketing Tools your Small Business needs to keep up, excel, and grow. Constant contact. Helping the small stand tall. Bloomberg has learned that the plant u. S. Restrictions on advanced tech investments into china will be less ambitious than invasion. Lets get the details from our asian asian north north asian correspondent. This does play into being able to balance out relations. What does the structure look like . Its critical, because we have a number of cabinet numbers go to china recently, including janet yellen. We can talk bit about the dynamic there in a little bit. But they are trying to assuage the fear that china has about this. It has been in the works for more than a year, and this biden executive order which would curb u. S. Investment into advance, cutting Edge Technologies like bottom quantum computing, advanced semiconductors, and ai. We are hearing from sources as the Biden Administration is ready to unveil this big executive order that it will be scaled back a little bit, because of that conflicting agenda. You want to limit the plas access to these advanced technologies but you also want to improve the relationship with china. How do you do that . Scaling it back. I built a graphic that gives the nuts and bolts of the sources telling us what is going to look like, the final executive order. These sources are saying that it will likely apply only to companies in china they get half their revenues from cutting edge areas like quantum computing and ai. It would prohibit investments in ai for military and used and users, require notification for any investments in other ai activities, ban investments in quantum computing activities such as key encryption and sensing, and ban investment for certain super advanced semiconductors. It is not this outright ban. We have heard janet yellen talk about that, that it is going to be more targeted. This is potentially good news for private equity firms and venture capitalists, who would be allowed to invest in larger Tech Companies that dont get half of their revenues from ai. I am talking alibaba, and the like. Good news, there has been lobbying on the administration to not go too hard. Good news potentially, or at least less bad news for u. S. China relations. I also mentioned janet yellen, i am sure she was there telling them that some of the details that are likely to stick in the final version of this investment ban. Again, the Biden Administration has wanted to improve relations, they sent Antony Blinken to beijing, and their climate envoy john kerry, also janet yellen. And there is dialogue going on and that is quicker. Will this investment ban the rail that progress . Yet to be seen. But a scaledback version of the investment ban would be more welcome news than a really hard band that was initially ban that was initially speculative. Sticking with china and Property Markets, Country Garden stocks bonds plunging on tuesday, some Chinese Developers say bondholders say they have not received payments. What specific notes are we talking about, how much are they worth and what are the locations . Implications . There is this bond that has 10 million of interest in dollar terms, and another bond that has 12 billion in interest. The amount of interest is not big, and they are supposedly due monday, but we have heard from noteholders they have not received any payment as of the end of tuesday. That puts a lot of question into whether Country Garden is able to make these payments, but also noting that these notes have a 30 day grace. For interests, Country Garden still has months a month to grace stretch for him, and they still have a month. This was one of the strongest Property Managers in china, and they have not been swept up in the defaults. What are the indications with the property sector where we could see policymakers boosting the sector . This could be seen as kind of the last straw for chinas property sector. There was a lot of hope that Country Garden, being one of the stronger developers, and being one of the ones that received government help last year, could whether all of these liquidity concerns. Into this year, we see that they have dropped 60 on sales on year on year, and last year was a bad year for them. Nothing has recovered in the physical market for Country Garden and some of its peers. I think the market is questioning whether the government will roll out more support measures, because currently what we have seen in terms of support is not enough. You know, this downturn has continued to worsen sentiment, and i think, you know, it was a really dark moment for the market yesterday in terms of the property of stocks and bonds. And people are really questioning if there is anything that the government is going to do to step up. Are reporter loretta chan there with the latest on Country Garden and the property sector. Taking a look at currencies trading, we are following the yuan closely, that the 7. 23 level, we have seen incredible maintenance in the chinese run, especially after the yuan fixing at the weakest level in almost a month, and ecodata surprising to the downside. Take a look at the aussie dollar which has fallen alongside the yuan, with that weaker fixing. We could be heading towards that 2. 23 low, and the korean won is seeing weakness as well. It really has to do with Broader Market sentiment, especially when we have inflation data coming out on thursday. We have already seen jobless numbers for south korea, the rates rising to 2. 8 percent, which is higher than the previous month in june, and also a really higher rate than economists had expected. They yen holding at the 143 level. 1. 43 level 143 level. More to come, this is bloomberg. From merrill. Is he hailing a ride to the concert hall . No. Hes making sure his portfolio and retirement plans work in harmony. They want to adopt a child and build a new home. So theyre talking numbers with their merrill adviser. Shes not researching her next role. Shes learning how to handle market ups and downs without the drama. Personalized advice so impressive your money never stops working for you with merrill. A bank of america company. 76 of 23andme Health Customers surveyed reported taking healthier working foactions. Th merrill. Because they know health isnt just a future state. Health happens now. Start your dnapowered Health Journey today with personalized insights from 23andme. Has on set to be in talks about joining other companies as an anchor investor in softbanks arm ahead of its ipo, lets get more from david wu, who and our north asia text coverage reported. What are the implications of amazon joining this group, and what does it say about the attractiveness of this ipo . It seems that amazon is it shows that major Tech Companies are interested in this huge ipo. People have also reported that softbank [indiscernible] and we also previously reported valuations could be as high as 62 billion if get softbank gets what it wants. In terms of valuations, the gap in expectation and estimates is pretty wild, right. At the upper end, is there a concern that it might disappoint . That is certainly a possibility given the economic headwinds this year, but [indiscernible] [indiscernible] we just have to wait and see. Debbie will, who leads our north asia tech coverage. Lets take a look at futures in europe opening, and the focus was really the big selloff that we saw in italian banks after the announcement of the windfall tax, we saw that 10 billion wipeout from the market value of italian banks, some estimates by the likes of citibank estimating that will wipe off 12 when it comes to Bank Earnings Going Forward. Watching those again in this session, futures are looking pretty much to the upside,. 7 higher, other futures up by. 5 as well. We have futures do, as well as aligning those expectations for the growth premium and opportunities between the fed and the ecb and other risk assets continuing to play out. Lots and lots to contend with. Not to mention those trade numbers out of china, no doubt that we will see a reaction on those Inflation Numbers. Lets get some of the latest corporate stories of the moment, of course, we are talking about chipmakers, and that arm ipo, lets talk about tsmc, because they agreed to build a 11 billion 11 million plant in germany. This is their first step in establishing a major european present, to counter risks from escalating u. S. China tensions. Tsmc will own 70 of the plant fabrication, and operate the facility and its partners will hold a 10 equity stake, subject to regulatory approval. Nvidia announced an updated ai processor which gives a jolt to chip capacity and speed. They are hoping to cement their dominance in a burgeoning market. The chipmaker says that the super chip, a combination graphics chip and processor, would access information at five terabytes per second, they have built an early lead in the market for accept, helping the Company Propel its valuation past 1 trillion this year. We will have more from dbs next. Wow, you get to watch all your favorite stuff. Its to die for. And its all right here. Streaming was never this easy, you know. This is the way. You really went all out didnt you . Um, its called commitment. Could you turn down the volume . Here, you can try. Get way more into what your into when you stream on the xfinity 10g network. s estate for asia, 30 minutes into the session so far and the focus is on earnings coming through, kicking off with softbank under pressure. We did see it reporting a firstquarter net loss and a surprise announcement of what investors do seem to be focusing on, aside from positive news, which is the vision fund returned to profit for the first time in six quarters, and a line of investors now being moved to join the ipo, including the likes of alphabet, which has been reported by the nikkei and amazon. We also have an airconditioner manufacturer stock dropping, we saw its operating income missing estimates, and nikon is another one where we saw its First Quarter profit results being disappointing. We did see a downgrade coming through from Morgan Stanley on the stock. Other stocks in focus, a cosmetics manufacture, and we saw that firsthalf core operating profit beating what analysts had been estimated, and also a Sports Apparel maker jumping at the start of trading in tokyo, and we see it raising its fouryear profit forecast, some of the earnings that we are focusing on with japan today, lets take a look at what is happening in japan, cba is the company that we are focusing on here. They are reporting a profit climb for the for your result, the ceo cautious about the outlook, but australian lenders are faring well in an environment with unemployment at a record low level, the Property Market being strong and austria as well. Aussie banks to the upside even though we see the broader financial index looking a little bit weaker in the session today and that was after we saw moodys downgrade coming through for u. S. Lenders. Lets change on, because in focus today is semiconductor and semiconductivity sought stocks in focusing career. It refers to transmitting energy with zero resistance which has never been done at Room Temperature, but this is the breakthrough which is being promoted by some scientists, it could be something that would revolutionize the entire energy industry, we have now seen a u. S. University pouring cold water on some of those claims, and we are seeing these stocks losing a bit of ground. But superconductor technologies is certainly a key focus for us over the past few sessions. Southeast chinas biggest lender is back for the dbs greater bay area conference. This year, their focus is on transformational forces for the new economy, we are joined exclusively now by dbs north asia president sebastian par edes. Good to have you with us. Youre coming to china at a busy week, we have plenty of economic numbers out, and so far they have been pretty disappointing. With this backdrop, what is the growth target for dbs and Greater China . Good morning, thank you for having me here. Indeed, after the reopening, we are very excited to be able to have our first dba conference after almost 3. 5 years. We are quite optimistic that the government is doing everything they can to stimulate the economy, considering the slow start after covid. There are some pockets of areas and industries that are very interesting to follow, for example, electric vehicles and batteries, and new energy, and the Huge Investment that is taking place in the semiconductor industry. We are positive that gpas will gba will outpace the growth in china, and once the savings rate, which is historically high, today, hi today, return suspended, the economy will rebound and we will see growth in the latter part of the year through 2024. There is no reason not to the be optimistic about the longterm prospects of china. When you see an 18 trillion economy, the second largest in the world, growing at a 5 pace this year, and 4. 5 next year, it provides most one trillion 1 trillion incremental growth. Does that mean it will propel dbs . Because in the first half, it seems Greater China accounted for about 20 of your total income, but correct me if im wrong, where are we going for the rest of the year . And perhaps more longterm, in the next five years, the conservation of chinas your business . Contribution of china to your business . We not only seek domestic Mainland China, but also Chinese Business around asia, because we support not only Chinese Companies and chinese affluent segments in Mainland China, but we also have a substantial, important business offshore in hong kong, singapore and the rest of the asian countries. We have Chinese Companies which grow in the rest of asia and the world through offshore relationships. The way we see china is comfortably. We are very optimistic, and if you see, for example, the track record of dbs in singapore and hong kong, related to china businesses, theres doubledigit growth within the last three years. There is no reason not to be optimistic about continued growth and pace of growth. We do recognize that there are challenges now that the Interest Rate differential between u. S. Rates, one dollar rates, and r b rates is substantial. That is why we have been shifting to onshore. On the liability side we have a windfall of opportunities because of the Interest Rate increases offshore. What about competition . How do you position yourself in a market with players like aspc . We have been very keen on strategic positioning, trying to position ourselves to serve our customers, wherever they are, and we have been in asia for the longest time. We have a very longterm view, and therefore, our company and customers, through thick and thin, as we have seen in the last three years, with covid, you have seen how we have progressed in organically with the acquisition of some businesses within the last for years, especially korean banks. We have also acquired the Consumer Bank business of the anc, and we are going to complete the acquisition of citibanks really Retail Business in taiwan. I think that the prospect of our strategic positioning, as well as our International Credit rating, coupled with our capabilities and longstanding customers make us different, i would say. How many people do you have in Greater China and what are you planning in terms of increasing headcount, how are you finding the broader hiring environment across china and hong kong, given the difficulties of the last two years . Few years . We are close to 4000 and Mainland China, 5000 in hong kong, and with the integration of city the citibank and taiwan, we will have more than 4000 people in taiwan. We continue to grow. We continue embedding technology in our business and improving productivity, and that productivity has resulted in a mild increase in headcount, except for inorganic acquisitions. And we expect to continue to that. We have never laid off people for expense management. On the contrary, we have been progressive in our approach and we are optimistic that we will continue to do so in years to come. For gba, we need to accelerate our investment, accelerate power hiring, and our geographic view has outpaced the growth from dbs china. We are excited about our Growth Opportunities at gba. Tell us about Dbs Hong Kong, because we have seen pressure in that business in the first half. How will that are not for the rest of the year . That turn out for the rest of the year . Heard that net profit after tax, this is the third year in a row we have seen very robust growth. We were very disciplined and focused, and we avoided getting into trouble with chinese real estate exposure. Therefore, our franchise demands have been very resilient. We have had doubledigit income growth, as well as net profit after tax up 39 . This year we will see the third year in a row of growth after covid, those difficult years. We are optimistic about the current year, as Interest Rates begin to tame, we expect next year that the income will offset decreasing revenues arriving from Interest Rate decreases. Optimistic overall, even though we have seen the loans shifting to Mainland China, but the funding capabilities that we have built from the last decade as well as the products and expansions of we have had, coupled with the integration in china, Dbs Hong Kong will continue to show very strong growth. Sebastian, how do you view political risks and management . Do have contingency plans if tensions were sceniak up worsted . We are focusing on what Business Matters we can manage. We do not get involved in geopolitical discussions, we focus on what the business brings, and we always position ourselves around what is the risks on the businesses. And we do not take proactive approaches in case of black swans, because of those happen, it will affect all of asia in general. We just want to make sure that our customers are being served and making sure that our customers are being taken care of, and we focus mainly on making sure that we do the best that we can operating in a very challenging environment. Dbs north asia president Sebastian Pinera is there. Paredes there. We have several a pair of interviews of ahead, and the micro connect founder and chairman will be joining us later. This is bloomberg. Work tumbled in late trade after substantial doubt about its ability to continue operating. Further details, lets bring in vonnie quinn, we know that this was a company that struggled for years, especially during the pandemic. What is happening . For the real estate sector in general, and the Office Sector in particular, commercial real estate, the company has spent billions trying to become profitable, it never has been. Now, it looks like it might be a death now. We dont know, there has been a restructuring in the past. We were at this point when adam neumann was ousted, he had failed to bring the company public, and a new person command, came in, and he restructured the company and we are still at this point. He left in may, and just in general, secondquarter results showed occupancy dropped compared to the previous quarter. If youre talking about returning to a work situation, and it had been improving and now it is not improving, that does not bode well for we work. They say that they will reduce rental costs and negotiate more favorable leases, but they did that already and apparently since 2019 it says that it saved nearly 12 billion by terminating and amending hundreds of leases. Its a very serious situation for this company, and remember, it rides 20 million square feet of office space, more than any Single Company in the united states. It has a 614 locations. It could have substantial ramifications beyond just the company itself. Three of its independent Board Members are being replaced by four new Board Members, and they continue to search for a permanent ceo. The last one was there on an interim basis. Those shares trading at less than . 21 at the moment, down 33 at their worst, post market. Softbank is down quite a bit in the session so far today, but it does feel like Vision Fund Softbank is more or less back on track. But i bankruptcy, how does that impact them . At this point, some executives had disagreed with him on this particular investment, he went all in and he adored it he visited and fell in love, we heard this from him back in june. It remains to be seen if softbank takes more writedowns, it always took already took a haircut, and it has invested 12 billion into this company, and it was one of the pet investments of muscle yoshio. What they will do now, im not sure, we will have to see what they come out and say. They are not commenting yet. It is an embarrassing situation, with the ceo apologizing for this particular investment. Will they continue or find another way to invest and try to save some of their money, perhaps. They have already spent the 12 billion and loan hundreds of millions of dollars to we work to try to keep it going. Lets see if they can. Vonnie quinn there. Lets take a look at some of the other stories we are following. Tsmc has agreed to build an 11 billion plant in eastern germany, in partnership with several semiconductor investors. This is the first step in establishing a major european present to presence to counter jew political tenths tensions. They will own 70 of the plant fabrication. Nvidia and other parties partners will hold a 10 equity stake subject to approval. Heavy losses expected to continue for rivian as they work to reestablish themselves as an ev player. It is projecting an adjusted loss of 4. 2 billion, above prior guidance. But narrowly short of analyst estimates. The company will build 52,000 vehicles this year, up from the prior goal of 50,000. Cathay pacific has set High Expectations for strong momentum to last well into the next year, after their biggest profits since 2010. For more on what to expect, lets bring in our asia transport reporter danny. Great to see you in person. For cathay, these ticket prices will be key. Absolutely, on top of guiding talks, hong kong heads to its highest level since 2010, and they said that they are going to pay back or redeem 9. 45 billion hong kong dollars as well. That was money given to them to rescue them back in 2020. They are saying cash going out of the company, and we are seeing high levels of demand, hype ticket prices which gives them the confidence to pay back, especially with a capacity of being some type, and that is what is driving up these ticket prices so that you and i and many other people will be watching and paying for higher fares in the near future. A busy week in terms of earnings, we also have lee auto reporting betterthanexpected quarterly results. What do we expect from them Going Forward . Lee auto is the best of the free bid up starts in china, they delivered a beat on revenue, and income. They raised revenue expectations expected to deliver up to 33 billion you want in the Third Quarter yuan in the Third Quarter. They are expecting up to 330,000 ev units. Delivered. To be delivered. But for them being the strongest of the big three, they have been consistently growing month on month in sales, but they have delivered a very very conservative sales estimate. That is what has caused other adrs to follow by followed by around 11 . One of the strongest competitors to tesla in china, particularly with its higher value, higher range, higher spec electric vehicles. It seems a disappointment for investors. But lets point out that shares have still doubled where they were at the start of the year. Are transport reporter danny lay there, much more to come here on daybreak asia. This is bloomberg. He snores like an angry rhino. Youve never heard an angry rhino. Baby i hear one every night. Every night. Okay. Ill work on that. Save 50 on the sleep Number Limited Edition smart bed. Plus, 36 month financing on select smart beds. Shop now only at sleep number. Taking a look at asian stocks trading at the moment, a mixed picture across markets right now, we are seeing the tech sector leading gains while industrials are losing ground, perhaps not surprising giving the disappointing economic numbers out of china, we are respecting those Inflation Numbers later the today today. We saw the nikkei reversing yesterdays game and losing ground, although the cost is rising for the first time in six sections. Have the jobless rate high higher than expected, but its still a very very low number when it comes to south korea as we continue to see resiliency in the labor market. So much of that in terms of expectations bleeding through what we get out of china. We know today will not be great, except to import report Inflation Numbers, in just a little over 30 minutes. The deflation prospects hanging over the economy. Lets take a look at much more that and much more. The key question [laughter] i miss you too, share. Its like the old days. But the key question is did china outright see deflation in july, a lot of comets are suspecting that possibly here. The data is going to show a cpi and ppi price falling into contraction, both for the First Time Since 2020. The macro picture has not played out as expected, quite the opposite. Take a look at the cpi forecast, and a range that we are expecting. Everywhere from 0. 9 negative territory all the way to positive 0. 2 , thats quite a wide dispersion, but its mostly negative prints, mostly into foot disinflationary camp. China is already in deflation in some ways as well. Is this the bottom, is that the key question . Bloomberg economics seems to think so. There was a report saying that the fact that we are seeing more stimulus to buoy growth could market that market weakness is at or near a bottom. No good news today, or from patrick. Its a story that keeps on giving. Stocks and bonds hammered yesterday, reports from reuters that bondholders said they did not receive their coupon payments due on monday, talking about two separate notes here. They have come out talking about how there is a bit of stress that they are seeing, thats an understatement, it seems. The hammering that we saw when it came to the stock and bonds, on average the movement when it came to the yields on junk bonds and dollar bonds was about 600 basis points according to bloomberg pricing. We got a slew of downgrades this morning. Is a busy, we will be here over the next few hours, that busy, busy. We will be here of the next wee hours, with more data training from shangha kong and shenzhen. Thats next. This is bloomberg. Eating healthier. And simply getting more sleep. Because they know health isnt just a future state. Health happens now. With over 150 personalized genetic reports from 23andme you can start your dnapowered Health Journey today. Mike what gives something value is not the technology, it is the social construct. In the excitement of building this crypto industry, we attracted a lot of frauds. You know, bad actors, criminals