Pointing to a higher open, also the japanese yen, slightly strengthening after falling the most in 17 months. A couple of markets are closed, australia and new zealand. No markets open there. The yen did drop the most in 17 months after the bank of japan is considering sending relief to its banks. Mayces say the bank consider offering a negative rate on some loans. We are taking a look at this. The yen took a tumble. I was watching the market close on friday, bankshares surging on this news. Sign, the yenme reaction, what the boj has been hoping for after currency strength, up 7 . Last week, the currency dropped to 2. 7 against the dollar, a there where the dollar strengthened significantly against the yen on that news. The euroyen fell 1. 6 for the week. Helpoj may be trying to the nations lenders after irmsit demand from all f have seen demand drop. And is a stimulus measure possibly help in a little way. Could be inion conjunction alongside further negative rates on reserves already. That will be interesting as we head into the boj this week. What is going to happen to the yen. . For the time being, the currency weakens. In the mediumterm, i dont think the boj will have yensulty taming the rise. Yen can believe the certify this because of the fiscal situation in japan. Most analysts dont expect too much strength when it comes to the yen heading into this meeting. I want to show you a chart that shows how bearish the sentiment is right now when it comes to the japanese currency. Options actually rose to an alltime high on friday. Many economists saying something must come out of the boj this week, but volatility skewed here, steepening shortly sharply in favor of the yen put options over calls. That itlso anticipation will expand its Purchase Program and by some etfs . The slim majority we see where we are expecting some stimulus measures out of the boj, the earthquakes hitting and april. So the economy is ripe for some easing. Of 41 analysts expecting something, and out of those, 19 say they may be buying more etfs, eight saying by more bonds, and others saying to expect another cut on negative rates this thursday. Angie lets continue this conversation on japan. The boj is quietly intervening in the japanese share market, becoming a top 10 holder. In continuation to what you are saying, most economists expecting the boj to buy etfs. Under the stimulus plan, they are buying ¥3 trillion, more than 27 billion dollars, of etfs every year, so not disclosing the details, but you can do the calculations on bank records and company records. Ranks as athe boj top 10 holder in more than 200 of the nikkei 225 companies. The central bank effectively , 5 of9 of retailing shareholder. Fifth our now that the boj will accelerate the pace of purchases of etfs. Goldman sachs saying that if you trillion arate, ¥7 year, then the central bank could become the number one shareholder in 40 of the nikkei 225 companies. Sayou do more than that, ¥13 trillion the year, then the boj will hold the top ranking of 90 firms. Angie there is some danger to this. There is some danger. Lets go through the positives. The proponents are saying it will boost investor confidence. This is at a time when the nikkei 225 is down 5 this year. Waning, confidence is so this will give shares of boost. For those people investing and want to see the stocks rise, this is fantastic. Problem iso, the affecting the sanity of the stock market. They are saying that the impact on the japanese bond market by purges by the boj could distort valuations and undermine efforts to improve corporate governance. If you take a look at what corroded says, his defense is that the purchases are tiny compared to the size of the japanese economy, but the fact is that they are using these large etfs, and what that means is that they have a bigger impact on concentrated companies, not so much those companies outside the indices, but for example fast retailing. , more than 11 c of that company. Angie most people do expect some type of etf buying. The majority thought this could be happening as the boj meets this week. People are weighing in on negative rates. How effective is is going to be . Some people say not effective, because youre not solving the underlying issue when it comes to the nation lenders, which is loan demand. Is a consternation no doubt to japanese and Global Investors alike. Thank you so much. Lets check other headlines. Will complete the expansion of its oil field by the end of may to maintain total Production Capacity output, rising to one Million Barrels a day. Saudi palms 10. 2 Million Barrels a day last month, and can go to 12. 5 million with in six months, if it chooses to. Riyadh says it will continue to invest in Oil Production despite the supply glut. Hong kongs stock market is free reintroducing a closing option. Hong kong exchanges and clearing says the new system will the details. The previous system was scrapped in 2009. Emd had its biggest jump in more than 35 years after announcing a deal in china. Soaring 52 on friday, the sincet increase in amd 1990. Get 290 3 million to license technology to a statebacked venture and produce chips exclusively for the domestic market. It will be overseen by the Chinese Academy of sciences. The latest and greatest in beijing this week, but overshadowed by the emissions cheating scandals that have affected volkswagen and mitsubishi. Lets start with the testing scandals. What are people in beijing saying about it . Good morning. Over the weekend, we had a slew of preshow product launches, infinity, ford. Last night, mercedesbenz as well. Overshadowing all that are the in emissions scandals. The Industry Needs to be more transparent about its process for field testing and emissions. Mercedesbenzer was asked to check over its processes in the u. S. Peugeot has had its offices raided. Minutes of the she said it was mitsubishi says it has been manipulating. It is overshadowing the show to some degree. ,here had been talk about suvs luxury vehicles, electric vehicles, but the regulatory consequences in focus. I spoke to the ceo of ford and ask them what this change in regulatory temperature and oversight i the authorities, what kind of impact that was having on the industry. Listen to what mark fields had to say. Look at emissions, we meet all applicable emissions requirements. We do not employ socalled defeat devices. Our approach is that we meet the letter of the law. In china, the rulemaking that is being proposed right now is probably the most strict over the next five years in terms of reductions in the world. Whatever that is, we will work to meet that. Mark fields, ceo of ford, speaking to me over the weekend. Increasinglyn tough Regulatory Environment in china, a country suffering chronic pollution problems. Ford stickssaying by the letter of law in every operates. On where it he says he is completely confident in ford and its processes there. Angie pollution no doubt of focus. What other issues have been getting play in the lead up to the show . We have been talking about suvs, a lot of international and local Companies Launching suvs to take advantage of a growth in demand in china, up 50 in 2015, the demand for suvs. Despite high import taxes for foreign brands, continue to be in demand. Of course, electric vehicles, a lot of chinese players getting in on the action. A Chinese Tech Company launching a concept car. Infinity has launched a concept suv as well. Mercedesbenz launched a new stretched version specifically for the chinese customer. The suv market was very strong last year, but compared to former years, last year was softer. In the First Quarter, sales for , so iere up 14 this year asked the ford ceo how he felt about growth in china. This is what mark fields had to say about that. We have not been surprised that the market hells out market held up. Addition to the full year if x we are getting from our new products, we introduced the effects, last year the industry came in at 23 Million Units. 23. 5 to 25 Million Units. In our estimates, the First Quarter was up 8 or 9 , so off to a good start in china. Fields relatively bullish about the prospects for ford later this year. Introduced the f 150 raptor for the first time to china, which they hope will play into demand for bigger vehicles in china. Back to you. Angie the beloved suv also and china. Thank you for that. Coming up next, centralbank actions remain under scrutiny with three rate decisions in the pipeline. Our next guest is not expect much. Hear from the Deutsche Bank chief economist after this very short break. Stay with us. You are watching first up. Take a look at the big events we are following this week. Back iny, mitsubishi the spotlight when it reports earnings, the company embroiled in a few efficiency scandal, losing more than 40 of its value. The report will not reflect last weeks drama. On the agenda wednesday when the doors open to the public at the beijing auto show, the biggest in asia, and Tom Mackenzie is there. It takes place in the biggest car market in the world. Comesears extravaganza amid the slow down as manufactures are desperate to retain market share. We say me more action from boj policymakers this week, a majority of economists expect the bank to add stimulus. The decision on thursday. Also, sony releases its full years earnings report. Last year, preliminary profit by 274t missed estimates Million Dollars, and expects revenue to fall only 2 on the year. Lets take a look at the week in more detail with michael spencer, Deutsche Bank chief economist and head of asiapacific research. Your team no doubt getting ready for a very busy week. , all meeting. What you think will prepare markets the most . I think the boj. The market is expecting them to ease. Our expectations are they do little. Angie despite the pressure . Energy Price Inflation is still a major drag on headline inflation. They cannot get people to look at core inflation rates, which are substantially higher. Secondly, the market is convinced that the only way qe works is through the exchange rates. They look at japan, where the currency is moving in the wrong direction. If you take a broader perspective of how Monetary Policy works, you would say that the move to negative rates in january has been impactful, a significant decline in bond yields, government bonds, corporate bonds. You have seen an easing of banks lend, so its reasonable to say that the policy has had a big impact, signs that that is maybe turning into a higher credit growth, so we need to give it more time. If they feel compelled to do something, the market is so strongly position for them to do something, they might have to. If they dont, that would be a major surprise. From the boj will be that policy is working and we need to give it more time. Goldman sachs and hsbc expect asset Purchase Program to expand, buying etfs. Goldman sachs and it could double to ¥7 trillion. It is certainly possible. At this point, they are perhaps fishing around for what can we do. The easiest thing to do is buy more government bonds. I think there is not a lot of impact from buying etfs. If they continue to follow the ecbs playbook, then theyre looking at corporate bonds. The fed. Ts talk about when you expect them to raise rates . December. Angie like everybody else . The fed the problem for is that inflation is at a level where they feel they should be raising rates, but we are clearly going through a soft patch. Growth is slightly positive in q1, so that rules out this week, and nobody is expecting it. Into q3bly takes us before the fed will feel that they have enough evidence of the economy pulling out of this soft patch before they can raise rates. There is no expectation of the fed doing anything, and of course they have been dovish surprisingly and placating the market here, how important will the lang which be . Will the language be. . The market is expecting no hike. Theyre not expecting a hawkish statement at all. Expecting there fed to argue that inflation is creeping up, the labor market continues to adjust in a favorable direction, 200,000 jobs a month, but temporarily, growth is weak. Weak, all these inflation targets of 2 , 3 , that has been a pipe dream. Nz, bill english is trying to increase oversight because the frustration they are nowhere close to their inflation growth. The centralem for banks is Energy Prices are so important and driving headline inflation rates down. If you look at core, you have a number of Central Banks that if they could people to look convince people to look at core inflation saudi arabia needs to talk to Central Banks. On the supply side, oil prices are starting to creep up. I know we have said this before, but you run this 40 year, the inflation picture will be very different in a years time. Thank you for that. , find out how the philippines president ial hopefuls plan to decongestant capital, where the cost of gridlock is 64 main dollars a day. 64 million a day. That is quite a jam there. Angie welcome back, you are watching first up. Candidates in the philippines have had their third and final televised debate, focusing on manila is a crowded traffic. Lets go to the Southeast Asia correspondent has linda. Tell us some ideas on that. Haslinda several proposals came up during the debate yesterday, including building a new capital altogether to replacement a la. That was suggested by replace manila. That was suggested by the woman who has trailed in all of the ratings. People said hand, they would complete current projects while another candidate said he will ban all vehicles from main streets on top of buildings elevated train lines. Promises, which are difficult to fulfill. Traffic is set to get even worse in manila. A growing manila middleclass fuels a car boom. There is a possibility it could come to a standstill, prompting geddon amongme locals. The hurry this traffic is causing 64 million horrendous traffic, 1 of gdp. Angie that is what happens when the workforce is stuck in traffic. Is just one of the issues in the debates. How does that stick in the election . Haslinda a lot is at stake. It is among the Fastest Growing in the world. Since the has doubled president took office in 2010. It has jumped from investment grade. Whether or not momentum continues depends on the next president. One candidate says what else he hopes to achieve. I can assure you that it will government, and you will have peaceful country and of course, i said, drugs come at which is my main thing, i hope to suppress them to the end. 9 30 in sydney. Markets are closed to honor anzac day. This was extended as a national day of remembrance for veterans. You are watching first up. Top stories, the bank of japan nikkeiareholder in the 225. Estimates compiled by bloomberg say it is a major owner of more of japanese fortunes in the Worlds Largest money manager, black log three at situation will keep on growing. Predictions the boj could have etf fines as early as next week. It is considering a negative rate on adoptive loans. This could be positive for the economy, but raises questions about the banks position to offer subsidies to commercial lenders. Financial institutions already feel penalized by the existing negative rates, they could face demands from borrowers to cut lending margins further. The boj meets on wednesday. Fuel efficiency scandal and Mitsubishi Motors is in the headlines again. The company used a test of that does not comply with standards on 27 models that would amount to 2 million vehicles. It to be she motors admits data,lating consumption but said it only covers 600,000 cars in japan. The s p as putting the longterm Credit Rating on negative watch. Powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. Australiaith asia and and new zealand are closed for anzac. Here is haidi. Quietert is a little with the absence of australia and new zealand. Day forcommemorate the anzac. This is how we closed on friday. Indexiapacific really retreating, still, a Third Straight weekly gain for the regional index. Some late we saw stages surging in the nikkei 225 of why 1. 2 . Up by 1. 2 . Japanese lenders have been badly hit and will continue going down by the negative rates program. ,nd chinese shares reversing ending in the green. We had the biggest weekly loss in shanghai analyst for months down 4 . Dimming expectations similar from the pboc and the government. And the region, a feature of negativity as we ended out the week. We really didnt have tech earnings weighing on the u. S. Stocks as well. Futures in this part of the world are pointing to slightly positive when it comes to japan and hong kong. However, possibly they both, when it comes to shanghai. It is a huge week for Central Banks. We have the fed and then the bank of japan, which is acting in response to what the fed does. Of course, the fed is not expect it to move on the Interest Rate hike. The possibility is at zero at the moment. Japan is expected to add some form of stimulus whether it is buying into etf or expansion of the current stimulus program. At ties Industrial Production numbers coming out midweek. They had a big uptake when it comes in february, so we will see if that extends into march as well. We have ppi coming through from australia. That will give us the commodity story. The bank of japan will be talking today. To look at the brokerage families, the finish on the news they will be paid to borrow from the bank of japan. Alleviating some of the volatility when it comes to the impact of negative rates. Mitsubishi was up 7 , but certainly brokerages eating an eye on those today. Seeing if they can extend on the back of the bloomberg report that the boj will be extending the negative rates on some of these loans. Angie. Angie thanks. Mizuo will try to be popular. 60 ceo says they are adding Staff Members in the coming marks months. Reporter inthe tokyo. Trying to expand at this time when other banks are cutting costs . Reporter one of the reporters spoke to the leader last week, and he said they are looking to add 50 or 60 people in the United States. This comes amid other brokerage spends, standing out a couple weeks ago. Coming up to a thousand jobs across europe and the United States. Mizuho is among three megabanks that have been looking to the u. S. To try to grow as they struggle with ever tighter margins on loans. A couple of years ago, mizuho bought a large profile from ibf, and that is the strategy which they call super 50. Super thrifty. The banking and the security business, try to leverage alone business to get bond issuance from some of the banks. And the new chief executive just came from the former head of International Business at the banking unit. We are looking to see more Corporation Cooperation on the securities and banks. Angie when there is negative rates at home and rising rates in the u. S. , that makes sense. Japanese banks kobe reporting in coming weeks. What can we expect to see . Nomura is reporting on wednesday. We are looking to see if there is new restructure, with i cut a large amount of stock from people . We will see how that looks for them in the future. Profit, trying to getting out of that strategy. And the we go to the holiday, and then major banks will be reporting. At what sort of guidance we get for the following year. The czechs have been impacted badly by the negative rates, looking forward to next year. Techs have been impacted badly. Angie gary allen, thank you for that. Oil has climbed to a fivemonth high as u. S. Production sales were at the lowest since october 2014. Juliette saly is watching this. It is rebalancing . Juliette we are seeing production decline in the u. S. And other countries, and that is supporting oil prices. Futures rose 1. 3 on friday, bringing the gain to 1. 8 . We have a graph that shows as we see u. S. Production decline, it was down for a sixth straight week last week, we see the oil price rise. Also seeing production rise in columbia. Colombia. We have seen talk of reemergence of another brief talk, and that was in paris on thursday. International agency, they have expected nonopec output to fall by 700,000 barrels a day this year. That would be the sharpest drop in a quarter of a century. At the same time we are hearing from Energy Companies they are seeing a good downturn as well. The Worlds Largest provider of oil has cut more jobs in the First Quarter. Invesco telling us that what they are hearing from Oil Companies is carnage. Also we have this coming through on what is helping these oil prices to fivemonth highs. The number of active oil rigs, that is 343 currently, that is the lowest level since november 2009. We are seeing production resuming in another country like norway and has extend is expected tos dan is expected hkstan. Angie looks like saudi arabia is trying to rebalance its economy, less dependent on oil. What are they talking about . Juliette the vision for the kingdom of saudi arabia, this is actually the princes blueprint. Sayinga lot of analysts that saudi arabia is talking about this rebalancing for years. Angie the entire region. Oilette they first found 80 years ago. 70 of revenue comes from crude. Not a lot of thought on how they will rebalance the economy. A call for to see nonoil revenue to be raised by 100 billion by 2020. They will sell less than saudi aramco and also create the world funds. There will be levies on energy and luxury items. ,ll of this, saudi arabia is they are hoping to get away from the crude market. Angie thanks for that. Lets take a look at what else is on bloomberg. Here is sherry. Shery toyota will push ahead with plans to build and sell hybrids in china despite the lack of government subsidies. They want hybrid version of the rav4 suv. It introduces corolla and others last year and have received strong demands for the newer model. Them to legislative restrictions. The bidders for yahoo and find out if they are going to the next stage. Yahoo s advisors spent the weekend nearing the field to 10 billionranging from 4 to 8 billion. Verizon, and the course are shown and the consortium of baincapital are among them. We are watching reliant shares at the opening in mumbai. That is after fourthquarter profits jumped 17 , the highest in eight years. That income climbed to 1. 1 billion, and the Oil Price Collapse, helping improve refining markets. Reliance plans to complete petrochemical worth 15 billion over the next year. India has resulted diplomatic passports to force them to return and pay off loans estimated at 1. 4 billion. Last week, the founder of the airlines said he isnt a willful defaulerter and the collapse with a genuine commercial failure. He is asked to pay 140 million to show his intent to pay up. A court in mumbai has given an arrest warrant. I am shery ahn. Chinas economic recovery is gaining pace according to the earliest batch of private indicators for april. We have Stephen Engle watching all of the details. We are talking not a deep shade of recovery. Stephen more like a backwards j. We dont have official numbers for april, but we have private gauges, one from china, three from overseas, one from satellite imagery which is very interesting. I want to bring up these four , a slightt show improvement. We count of new this kind of knew this, but now we see the main index rising to a year high. It is still below 50 and showing competence is quite weak. Also belowctoring is 50. 5 to 50. 5. And the china satellite Manufacturing Index, this is a base company called, where is it . Sky, i cant find it. Space no. They track more than 1000 different factories in china and see the Economic Activity coming in and out of the factories. Angie they are looking for trucks going out, Raw Materials . Stephen this rose slightly to 42, still below 50, from 48. It only had one positive above 50 reading in the last year. It is an improvement but there is a caveat three and there is still some headwinds in china manufacturing. Angie i see the pace of growth slow as it is in march, to the extent in april. What does it mean for the pboc . Stephen they had Interest Rates cant. They had been cut. They have been on reserve with banks, doing reverse repos, but most economists are getting improvement saying they will be on hold. The pboc will be on hold, cutting Interest Rates. The oneyear benchmark is 4. 35 . These are the six Interest Rates right here. Economists now have expected it 4. 2 , on hold until the fourth quarter. Angie thanks for that. Coming up next, misery for mitsubishi. The next guest believes it is likely to have a bigger impact on the vw cheating scandal. Why he said that live in tokyo. Singapore,s 7 47 in 8 47 in tokyo. Charles koch says Hillary Clinton may be a better person than any other repuican contenders. The chairman says none of the republicans is addressing the tech system which subsidizes companies and makes it difficult for new businesses. He also called Donald Trumps plan to register all muslims in the United States monstrous and reminiscent of nazi germany. North korea has successfully tested a Ballistic Missile from a submarine and warned of ability to attack enemies. Tracked the seoul launch and say it traveled 30 kilometers, much shorter than the typical range of other weapons which usually fly 300 monitors. South korea says it is unlikely the north has any operational submarine second launch missiles, they admit that the leader is making progress. And china is making all the be onese fraud suspects trial. They will be prosecuted along with 32 chinese citizens also deported from kenya earlier this month. Taiwan has protested this detention. Beijing says it has jurisdiction because they are chinese. No trial date has been announced. Powered by over 2400 journalists in 150 euros around the world, i am haslinda amin. Angie Mitsubishi Motors due to deliver reports on wednesday, but they will not do this because of uncertainty. A fuel economy scandal. We bring in the advanced Research Japan reporter. Do you think able issue and earnings forecast . Do you think they will issue and earnings forecast . There was quite a crisis. I think it is very difficult for the company to come up with any sort of earnings forecast within this time again because of the uncertainties regarding their economy problems. Angie doing the calculations no doubt, you and your colleagues have been doing that all across japan. What do you think the liability could grow to be for mitsubishi . Koji endo it is very difficult at this point. Partly because the number of total cars that the day that they might have to compensate is still unknown. They announced 5000 units last week, and then most likely that number, they will be a lot bigger than at this point they indicate. Probably over a Million Units might be cars they have to do something about it. That means they might have to compensate some of the shortage of their economies to the customer. Somemight have to buy back of the cars. They might have to get some of the tax benefit they received to the government. We might have to pay authorization to nissan. And in japan, it is a nosedive. With all the uncertainties, very difficult at this point. All of theounds like things. Like and is facing right now. You are saying mitsubishi could be even more negatively affected than volkswagen. Why is that . Veryendo volkswagen is a financially rich company, very big, and they have support from. He government, state, so on as far as mitsubishi is concerned, it is relatively small, one Million Units. They kind of have narrowed the financial crisis they experienced five years ago, but they are relatively weak. At this point, i am not really sure if they can receive all of the support that they need from the government. Angie all right, that is a good point. Lets expand this out to earnings for automakers, toyota, honda, what do you expect when it comes to performance First Quarter . Koji endo generally speaking, their earnings got a be public way down going to be probably way down because they againdollar rate is very negative this company. Dollar rate is very negative for this company. Thehe same time against money markets currency, japanese yen has been very strong. Demands voting wise, that it is weak, and the u. S. Theet, which has been textile for the japanese, has been slowing down. There are lots of decompensation charges, so that is not necessarily that good. Angie yeah, it is definitely headwinds. Thank you so much for that preview of japanese auto earnings. Managing director of advanced research, from tokyo. Find out what japanese travel agencies are not expecting a loss for the next few months instead of a profit. Angie welcome to the stock exchange, we are looking at the opening of japan and south korea. We have reporters to tell us about the stocks they are looking at. Uliette i am looking at hif. This is a function on the bloomberg. This shows you all of the analyst ratings, actually seven buyers, one hold, zero cell. 28 , and it now sees a loss in the year as opposed to a previous office. It is being profit. This comes to the travel company. Go. We see some trouble in the yogagawa bridge. They were involved in the earthquake. People injured, under construction, this bridge. So mitsui construction, they are the designer. The bridge is a partner in this project. They reacted in a cordial manner, but they got a lot of comments for this incident, still under investigation. Pictures coming out on friday. The stock is down 3 , but we have seen a great two months for yokogawa. We could see the stock the race all of those gains we saw you race all of the gains we saw on friday. Sell. S and one this is love my stock, in korea. It is a company that manufactures and sells cigarettes. So unhealthy. At the same time, they produce and sell herbal medicine, red ginseng. You can get healthy with the herbal medicine. It is perfect. [laughter] sell 2 oflans to their stake, they hold 6 of kt g. Maybe come out even. Angie that is the verdict from the stock exchange. They are based on news events. We will be back in an hour to see stocksnd where they have gone. Japan is set to lead asia higher at the start of the week, and there are signs the worst may be over for mitsubishi. Negativeonsidering rates on some loans, also an influential stakeholder in japan inc. The beijing auto show, the biggest in asia. First up is there live. I am angie lau. Welcome to first up. It is a quiet start to the Asian Session with australia and new but we markets closed, have a look at what the trading week holds. Haidi thats right. Zealandand new extending that long weekend. Lets take a look at how things are shaping up in terms of the open in seoul, korea and tokyo, flat at the moment, futures a mildly positive start. We also have a potentially negative open in shanghai, but higher in hong kong. Treading water at the moment. Potential negative rates lifting profitability. Essentially, these banks would be paid to borrow money from the Japanese Central bank. Flat at the moment. Lets take a quick look at the movers on friday afternoon. Japanese brokerages extending gains as much as 17 . Friday,hi was up on extended gains of. 5 , but some other japanese financials that rallied on the report that the boj would make a move, giving back gains, perhaps some profit taking given the stellar advances. Down by a 10th of 1 . Lets take a quick look at the yen. That has been the driving force for japanese markets, up just over 7 , a little weakness coming through today. Boj meeting later this week after the fed meeting, the big risk if vincent driving sentiments this week. Angie thanks. Recouping some losses, dropping the most in 17 months after the boj is considering sending relief to banks impacted by subzero rates. Analysts say the central bank may be considering offering negative rates on some loans. The yen really took a tumble on this. A welcome sign for the boj after they tried to stop the yens strength, still up 7 for the japanese currency. We did see some significant pullback on friday on this report. Pop on the this dollar, 2. 7 against the yen. Also, the yen fell against the euro this week. Those are the weekly gains. We do see a little pop on friday. Thises telling us that discussion on negative rates on loans is in conjunction with talks that they could be doing another negative rate cut on reserves. That is interesting to see as we count down to the boj meeting this week. Theyre trying to give banks from the boj money for borrowing. These are for banks impacted by negative banks already, all firms, large, medium, and small, has seen Credit Demand fall. Address this does not the issue when it comes to banks on the loan demand issue. Loans apply, but not the structural issues of the nations lenders. After this news are leading up to the boj meeting, we have seen the Bear Sentiment reach an alltime high. Eurois back in 2008, year yen options. The euroard, a pop on bullish bets surging. That is a measure of Market Sentiment right now. Shortterm, we could see further weakness as they dont expect yen strength ahead of this meeting. Longterm, some analysts saying this yen weakness will not last. Angie everybody focusing on japan. Boj quietly intervening in the japanese share market, becoming a top 10 shareholder in the nikkei 225. How did this happen . Trillion,uying ¥3 etfshan 27 billion, of every year, so that is what made it a top 10 holder of more than 200 companies on the nikkei 225, so the central bank controls 9 of fast retailing, 5 of , and a topfive holder in more than 50 companies. We can see that the boj has a huge influence in the stock market there. That it is also a top three holder in some companies in japan. The boj is now thought to be accelerating the purchase of etfs, at least that is the bet right now by a slim majority. If the Goldman Sachs predictions that it could up the pace to ¥7 trillion a year, then the boj could end up becoming the number one shareholder in about 40 of if askkei 225 companies hsbc says it ups the pace to ¥13 trillion, becoming the number one shareholder in 90 firms. Analysts are saying it is becoming like a big hedge fund. Angie we have been talking about this in the runup to this weeks boj meeting. There is a lot of pressure on kuroda to do something, add stimulus. Most are thinking this could be happening in terms of the etf affront. Of analysthe dozens we surveyed think they will be buying more etfs. Say they of those could buy more bonds, and eight are expecting another negative rate cut, so the slim majority right now, but the bets are stacking up. Feel like there is a fundamental healthiness to these companies. It is just boj money pouring in. That is what the critics are saying. Kuroda has been defending the program, saying the size of the purchases relative to the larger japanese stock market is small, but the fact is that these purchases are not healthy. Maybe for some investors that just want to see that share prices pop up, it is fantastic, but it could distort the sanity of the stock market. Not to mention that the bojs purposes are by using these large cap etfs. Its positions are concentrated, so it has more impact on a few companies. For example, the boj owns more blue chips in japan than blackrock, the Worlds Largest money manager. Angie lets see what happens on thursday. Thanks. ,oming up in other news expecting to remain profitable at overseas operations, ceo says company is cutting 60 staff in the americas. They have been adding staff at home and abroad as global banks cut jobs. Izuho is cutting about a thousand positions. The delay in the release of the annual forecast due out on thursday. You can see what investors are thinking about that news, down 3. 83 . An averse impact on operating results. Release results and may instead. Saudi aramco will complete a field to maintain total 750,000 tocapacity, one Million Barrels a day. Saudi arabia says it could go to 12. 5 Million Barrels a day if it chooses to. Riyadh says it will continue to invest in Oil Production despite the global glut. Rebalancing asof traders become more optimistic on oil. Our next guest says prices have bottomed. Hear from Mark Matthews after this very short break. Welcome back. These are the stories making headlines around the world. The japanese Prime Minister has of the two area earthquakes, also announcing plans for an extra budget to address the cost of the tremors. He said the budget would include funding to house businesses and infrastructure. Over 1 omy accounts to of japans gdp. Israel has released a 12yearold palestinian girl thought to be the youngest email palestinian to be jailed. Given 4. 5 months after confessing to planning a stabbing attack at a settlement in the west bank. She was afraid early on appeal. Of violences a wave on incitement by religious leaders. The palestinians say it is the result of living under israeli occupation. The president ial candidates in the philippines held their last debate, concentrating on chronic traffic. Candidates head she would build a new capital altogether, while others pledged to ensure current projects are finished. Candidate would build elevated train lines. Powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. Angie all right, first trading day of the asian week. Joining us now is Mark Matthews. What is on your radar . The boj and fed this week. I think those of the two major things. Of the two, the fed is far more important. Does ease, but the fed remains dovish, i think it will have a negligible impact on the yen. Angie the fed has been dovish, and likely to remain dovish until december, but is there a thought that perhaps they have lost all of the tools, the tricks of the trade, as it were, to boost this recovery . Do a qe4, they could but theyve done a wonderful balancing act of keeping us off guard. Nobody really dare say i think they will do this, because they have often said one thing and then done the other in the past. I you had to hold me to it, agree they will be very dovish this year. Especially that speech that janet yellen gave in march to ,he Economic Club of new york and the minutes of the Federal Reserve meeting for march, where they wrote the word global 23 times. They could reverse that, but why bother . It seems to be working. Angie not so much in japan though. A lot of pressure growing that in fact it would be negative if they did not do what was expected, expand the asset Purchase Program. 23 out of 41 economists are expecting them to ease, which means half of them will be disappointed. Angie how about you . I think they will say something, but i also dont think it will be impact for. ,he analogy i would use is remember last week, the monetary easedity and singapore the Interest Rates. 1 ,singapore dollar fell which is a big move for that currency. Now it is basically where it was back then. All these other Central Banks can try to tinker around the fed, but if the fed angie it is designed to spike sentiment. All of the Central Bank Moves are supposed to try to move the Market Sentiment in some way. You are neutral on japan still. We are neutral on the japanese market. I disagree with the consensus on one point, which is there were three arrows, and the one that most ise fun of the reform, but i think that is the one most genuine and happening there. It in buybacks and dividends and returns on equity rising, women in the workforce up 5 . Angie buybacks and dividends rising, but not flowing through to the workforce. It is flowing through to investors. The thing with reform is that in this day and age of facebook and twitter, we want everything right now, but reform is the most difficult thing because it is a societal and structural thing. Angie give us some good ideas this week. The major surprise this year is going to be china. Everybody has been so focused on the downside risks. Nobody has thought about what happens if there is upside, and there is upside. We saw it in the data over the weekend, and weve been seeing it in a lot of things. The msci china, all the earnings but together in the index, if you exclude the energy sector, they were up 9 last year. Angie would you go into industrials, energy, and china . I like stocks in hong kong. China is too volatile. Forecasting for that same bunch of companies, msci china excluding energy, a drop of 5 in earnings this year. Hasing at all the data that come out recently, very supportive for the industrial sector, i think it is impossible after you have seen 9 year on year growth last year in a challenging environment that you will get 5 Earnings Growth this year, so the number is very wrong. Hong kong, you say. Because theng kong shanghai market is volatile. If you look at the msci hong correlation of that to shanghai is only 30 . Hong kong does not correlate with a china, but it correlates strongly, 80 , with the emerging markets, than it has a 55 correlation to the s p. If emerging markets are doing well this year, which they are by the way, brazil the best, thailand, indonesia. Angie not politically though. I think it is Getting Better. Angie there were a lot of bets that its Getting Better with changes at the top. They are working through problems right now. Before let you go, oil, does this hinge on the price of oil . You are right. There is a strong correlation , buten oil and risk assets im not negative. I think it might have overshot a little bit now, but i see it in a range of 35 to 55 in the next three months. Opecs revenues, 20 of what they were five years ago. Theyre making only 1 5 of what they did. Saudi arabia is blowing through its forex reserves like there is no tomorrow. Even those guys laying tough now because they can get it out of the ground, but they still need more to balance their budgets. If you look at what the International Energy agency as saying, they are seeing supply go below demand next summer. Cambridge Energy Things it will happen in the third quarter. They know about a ran. Iran. Angie Mark Matthews, always good to see you. The Auto Industry is showcasing its latest and greatest, but overshadowed by the fuel and emissions cheating scandals. Our china correspondent Tom Mackenzie is there for you right now. Lets start with the scandals, what are people saying there . It is the glitz and glamour of the preshow launches. This scandal is overshadowing all the hype about suvs, allergic vehicles, and self driving cars. The ceos are under the spotlight. We heard from the ceo of saying theyler, need to be more transparent. This is after the doj was asked to check its testing procedures stateside. We know that who show is being looked at by investigators. We are hearing from japanese newspapers that mitsubishis field test might fuel test might affect as much is 2 million vehicles. The ceo of fort if he was confident that they are sticking to the letter of the law and the impact of increased regulatory oversight. , when you look at emissions we meet all applicable emissions requirements. We do not employ socalled defeat devices. Our approach is to make sure we meet the letter of the law. In china, the legislation a rulemaking that is being proposed right now is probably the most strict over the next five years in terms of reductions in the world, and whatever that is, we will work to meet that. Ford ceo talking to me over the weekend, saying he expects the Regulatory Environment to become tougher. He is also very clear that he is confident that ford sticks to the letter of the law when it comes to emissions tests and all the countries it operates in. Angie all right, Tom Mackenzie life in beijing. Shorting the dollar for the first time in years, hedge funds turning bearish on the dollar. Find out why in your fx headlines after this very short break. It is monday, the 25th of april, and these are your fx headlines. Hedge funds betting on dollar exceedingpositions those of strength by 21,000 contracts last week. We havent seen long positions for the dollar versus eight other major currencies. Dollar bullishness has been up a winning trade the last few years. Ledpean and Central Banks those easing efforts, driving the dollar up 20 . That divergence trade has fizzled out as the fed cut back inflationand for cash forecast. Falling against the basket of currencies under pressure that the pboc is guiding the currency lower. An index dropped last week since the basket was unveiled in december. The Chinese Central Bank raising its reference rate against the dollar, but lowering against other currencies. Singapore for one saying chinese authorities are going to face a weaker yuan against trading currencies. Any rebound in the greenback should see more stability return. The bank of japan gathering for its policy meeting. The currency dropping the most after bloomberg reported that the central bank may consider helping banks lend by offering a negative rate on some loans. Against alling it major counterparts, 7 against the dollar this year. Surveyed 41 analysts predicting the boj will expand stimulus this week. Half of those expecting an increase in etf purchases. Eight predicting a boost in bond buying or the boj cutting rates deeper into negative territory. We will see a retreat in these dollaryen bets, in particular as we move towards the meeting. We are seeing a little bit of a move, but the yen sitting at that 111 handle ahead of that meeting. These are the stories driving your fx markets this morning. Great time for a shiny floor wax, no . Not if you just put the finishing touches on your latest masterpiece. Timings important. Comcast business knows that. Thats why you can schedule an installation at a time that works for you. Even late at night, or on the weekend, if thats what you need. Because you have enough to worry about. I did not see that coming. Dont deal with disruptions. Get Better Internet installed on your schedule. Comcast business. Built for business. Thank you. Ordering chinese food is a very predictable experience. I order b14. I get b14. No surprises. Buying business internet, on the other hand, can be a roller coaster White Knuckle thrill ride. Youre promised one speed. But do you consistently get it . You do with comcast business. Its reliable. Just like kung pao fish. Thank you, ping. Reliably fast internet starts at 59. 95 a month. Comcast business. Built for business. 8 30 a. M. In cpi tore as we expect drop deeper into negative territory gear on year. We are half an hour of trading there. You are watching first up. Become aof japan has top 10 shareholder in 90 of the nikkei 225. The bank is a major owner of more japanese blue chips than blackrock. Expect the boj to boost etf buying further this week. Is consideringan a trot and negative rates on loans, such a move would be positive for the economy, but raises questions about the banks position to offer subsidies to commercial lenders. Financial institutions already feeling penalize by existing negative rates could face demands from borrowers to cut their lending margins further. The boj meets on wednesday. Mitsubishi motors shares have dipped again in tokyo after losing 40 last week over the fuel efficiency scandal. A test that does not comply with standards on 27 models, which would amount to more than 2 million vehicles. Mitsubishi admits to manipulating data, but says that only applies to 600,000 cars in japan. Powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. Lets check market is trading in the asiapacific right now. Nikkei 225 climbing fractionally. Lets see if there is conviction there. In south korea, the kospi 1 lower. Lets see what happens today. Hinging on all of that, we are watching oil. It did climb to a fivemonth high in new york as u. S. Production fell to its lowest level since 2014. Are there signs that perhaps we are seeing rebalancing here . Are seeing the oil contract in asian trade falling this morning. Looking at that new york price, it rose on friday, bringing crudes weekly advance to 8. 3 . U. S. Production fell by a sixth week. Shows the diversions between that fall in production, the blue line, and the white line, crude gaining. We are also seeing production in colombia fall. We could also see more freeze talks between opec and nonopec producing nations. The International Energy agency outputthat they predict will fall by 700,000 barrels a day this year, the sharpest drop in 25 years. At the same time, Oil Companies seeing a doubt turn a downturn, schlumberger has cut more jobs. That whatlling us theyre hearing is carnage here e. Weve seen crude production in the u. S. At the lowest level since october 2014, oil rigs falling to their lowest level since 2009, but also production resuming. There is a lot of chatter that will puteze talks further upward pressure on that oil price. Angie we have seen it impact reserves first saudi arabia, dwindling revenue coming from oil. How are they diversifying their economy . Saudi arabia is set to release a blueprint that they are calling the vision for the as they try this is to raise nonoil revenue. The blueprint forecast for 100 billion of revenue to come from nonoil assets by 2020. A lot of analysts are saying he has his work cut out for him. They have been talking about this for a long time, but have not come through with clear, concrete ways to do this. They will sell less than 5 of saudi aramco, creating the largest sovereign wealth fund. They will also put taxes on energy and sugary drinks, and also taxes on luxury items. They are trying to get a lot of revenue over way from that oil sector, which provide 70 of saudi arabias revenue. Angie there you go. Thank you so much for that. Chinas economic recovery is gaining pace this month, according to private indicators for april. We have all the details. Gradual improvement, not a sharp one. Not a v shaped. Private surveys from a number of companies, Manufacturing Index rising. That is the highest reading and a year. Nonmanufacturing, also increasing, services and other parts of the economy, 44. 2, but overall conditions are still week. Confidence is pretty weak. Companies indicating that they are not too confident going forward. They are looking for more policy measures from the government as well. Ni Business Confidence survey rises above 50, but barely. The mood at Services Companies not surprisingly is better than traditional manufacturers. This is a survey of Companies Listed in shanghai and shenzhen. Onre is a sub index confidence indicating that future conditions over the next the lowest ever since the index started in 2007. There is a bit of shakiness in the next three months as far as where the renminbi will go and policy. The next three months leading into the fourth quarter, we dont really know right now. Angie what does this all mean for the pboc . They have had six Interest Rate cuts, and easing bias, the benchmark lending rate is 4. 35 , record low, but most economists expect the pboc to maintain this , theion right here, 4. 35 benchmark oneyear lending rate, at least until the fourth quarter. The is a change from previous survey, where it was thought they would cut again between now and the fourth quarter. Hold to the fourth quarter, but fourth quarter, expect it cut down to 4. 1 . Needsists saying the pboc to save a few bullets in the chamber for more trouble down the road. Which explains that confidence survey. Angie thank you for that. Lets take a look at what else we are following for you on the bloomberg. Hong kong stock market is reintroducing a closing auction after a sevenyear gap, bringing it in line with other markets. Hong kong exchanges and clearing says the new price setting system will determine determine if chelation. It starts on the 25th of july. Kong stock market is the last of 22 Global Development nations without a closing auction. Sources telling us that first round bidders for yahoo could find out this week if they are through to the next stage. To have spent the weekend narrowing down the field. We were told that bidders verizon and a consortium by bain capital. Force the return to pay off loans estimated at 1. 4 billion, the founder of the airline says he is not a willful defaulter and the 2012 collapse of his airline was a genuine commercial failure. Millioned to pay 240 to show his intent to pay up. Mumbai has issued a nonbailable arrest warrant. Toyota will push ahead with plans to build and sell hybrids in china. This is despite a lack of government subsidies. It wants to bring a hybrid version to the chinese market. Nd introduc china has offered significant subsidies to domestic electrical vehicle makers. That was a look at some of the stories making headlines this morning. Lets take a look at some of the big events we will be watching in the u. S. This week. We have more from new york. The week ahead on wall street will the all about the fed, at least for the first half, as federal policymakers meet to discuss policy and make their a nouns been on wednesday about whether to raise rates. The reigning view has been for some time that they will keep ,nterest rates on hold particularly as concerns about the u. S. And Global Economy play out. November is the first month where traders place even odds on any chance for rate hikes. We will also getting new economic data, including initial readings on First Quarter gdp, new home sales, and orders for big ticket goods in march. Sales of new homes will have likely climbed to a threemonth high. Finally, some of the biggest names in technology will be announcing early earnings. At t, amongn, ebay, others, hitting us with their numbers. 82 of s p 500 Companies Reporting so far have reduced profit expectations. Go to break, we lets take you to the movies. The new version of jungle book is looking strong once again. Huntsman to lead the north American Box Office for a second week. The movie features the voices of bill murray and scarlett johansson, and the jungle book raked in 61 million. It highlights the different fortunes of the two studios. Itsey may roll out one of desolate sever, while universal may find it hard to match last years record. Next, taxes to traffic. Some hot button issues making headlines in the election campaigns in australia and the philippines. Youre watching first up. The president ial candidates in the philippines have held their final televised debate, concentrating on chronic traffic, a final chance to convince voters ahead of the main nine election the made nine election. May 9 election. Quite a number of suggestions to solve the traffic problems, and one candidate says, forget about manila. She will build a new capital altogether. Others promise to complete all current Infrastructure Projects to help ease congestion. Leading the polls says he will ban all vehicles from main street and build elevated train lines. Proposalssay that the seem feasible, but bear in mind s traffic issues are huge. This is a city of 12 million people. Speak to the locals, and youll bably hear them talk about and just to put it in perspective, the government estimates that Traffic Congestion is costing it 64 of gdp, so a, 1 huge cost to the economy. Angie no doubt. Manya traffic just one of issues addressed. How much is at stake in this election. A lot, especially when you talk about the economy, among the Fastest Growing in the world. Its stock market has doubled since the current president took junke in 2010, jumped from to investment grade. Whether or not the momentum continues, it would depend on the next president. The front running candidate had this to say about what else he hopes to achieve if he becomes the top man. You that it will be a clean government, and you will have a peaceful country , i said, drugs, the main target. I hope to suppress them. If you referred to the latest polls, you will see it is a close race. The ninth of may, it is imperative that the next president builds on reform. There is a need for the next president to pick up pace if here she wants it the philippines to continue to have that investment grade. Angie lets hope there is no traffic jam there when it comes to reforms. Now to the stories making headlines. Conservative koch says Hillary Clinton may be a better president than other contenders. He says none of the republicans are addressing a tax system. He also called Donald Trumps plan to register all muslims monstrous and reminiscent of nazi germany. North korea says it has successfully tested a Ballistic Missile from a submarine. Officials in seoul, korea track to launch, and said it traveled 30 kilometers. South korea says it is unlikely the north has an operational submarine that can launch pyongyangbut admits is making progress. Chinese police say all 45 taiwanese suspects detained in beijing have confessed and will be put on trial, prosecuted with 32 chinese citizens deported from kenya earlier this month. Protested the detentions, but china says they have jurisdiction because they are chinese. Powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. Property investment has moved front and center as an election issue in australia. The government rolling out changes to a controversial tax break known as negative gearing. Lets head over to paul allen in sydney. Hoping theion is promise to scrap negative gearing will be a vote winner. What is that . This is likely to appeal to any voter who cannot hit on the property letter. Capital cities have risen 55 over thpast seven years in australia. Rates,low interest Foreign Investment often blamed, and negative gearing. If you want to buy a property, you can take out a mortgage on that property, and if the rent does not meet a mortgage payments, you can claim that loss as a tax break. It is quite an extraordinary set say thecritics government incentivizes property speculation, so the Opposition Labor Party is promising to into this practice. This practice. They would retain it on new properties to encourage home construction. Up thistrying to shape election battle as one between the haves and havenots. Angie no doubt. Wars, but negative gearing does have supporters, doesnt it . As you mentioned, there are a , part of alords landscape in australia for a long time. A lot of people are in deep when it comes to negative gearing, so the liberal coalition is banking on those people not wanting to see this precious tax break taken away. The Prime Minister says this is away from mom and dad investors to build wealth. He says removing it would savage housing values, put up rents, and discourage investment. It took the government two months to come up with a counter policy to labours proposition to get rid of negative gearing, so they have meticulously researched how to keep it. It is very interesting to see an election shaping up with a central issue that is a major point between the two partners, that parties, and one voters will understand and will resonate with them. Angie thank you for that. Coming up, a look at how the chinese economic slowdown and one travel company impacts one travel company in japan. Details after the break. Angie some stories we are tracking for you today. The biggest jump in more than 35 years after announcing a deal on china. Shares soared on friday, the biggest increase since 1980. Will get 293 Million Dollars to license technology to a chinese venture. The venture will be overseen by the Chinese Academy of sciences. We will be watching reliant shares at the open in mumbai after fourthquarter profit jumped 17 on year to its highest in more than eight years. To 1. 1me climbed billion as the Oil Price Collapse helped refining margins. Complete projects worth 15 billion over the next couple of years. A quick check of the markets. Is falling as the the most in 17, months. The nikkei 225 down a fifth of 1 . , the index was little changed at the start of the session. Singapore starts trading in 15 minutes. We are taking a look at a down day, but lets see if the conviction keeps it there at the end of the trading day. Now pointing to a lower open. Extract exchange. Lets check in on what our reporters are watching. Im watching a travel agent in japan down by 10 . That is after it warned that it sees a net loss versus a previous profit, of first half billion, the weather and slow down and china hurting travel agencies. Quite a big drop their, 9. 3 . This highway bridge collapse, it was a construction site. Two workers killed, eight injured. That is putting big pressure on andstock today, yokogawa another company our partners. We will continue to watch that when. Of theas of the cause incident is under investigation, but falling the most in three months. Not so much. Arethinking my investors confused as we are about what the company does. It manufactures cigarettes and sells herbal medicine. Koreainvestor bank of. Ill sell shares the Industrial Bank of korea holds a 7 stake in the company. Angie thank you. That is the verdict from the stock exchange. That is it for us on first up. A good morning to you. A look at what is going on in china, indicators suggesting we have got over the worst of the economic slowdown over there. At least that is what we are being told. All indicators showing we are seeing a slight take up taking place. I will be joined by the volvo chief executive from the beijing auto show. This is not to be confused with the carmaker. He is the ceo of the truck making business that is traded in sweden. We will talk about what does mitsubishi and volkswagen do to get the sheen back on their tarnish logos. Rishaad monday, the 25th of april. I am rishaad salamat. This is trending business. Rishaad we will take you to beijing, tokyo, and singapore this hour. A quiet start to the week. Policy decisions from the boj and the fed. Yen on the up, oil on the way down. Sub indices revealing a stronger
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