Transcripts For BLOOMBERG Bloomberg Markets Asia 20170221

We are about 30 minutes away open in china and in hong kong. But singapore and malaysia have into whatonline really is a pretty lac lack lusr market. Of course, u. S. Markets have been on holiday for the president s day holiday. So a subdued start. The region, pairing the earlier drop with the costly about 7 10 of a percent. And Australian Shares down about 2 10 of a percent. Aussie took a brief dip but they have since rebounded. A lift,ar yen, getting thatd president s comments a march hike isnt off the table. Leading and financials the rise. Quick check on some of the movers today. Toshiba also in the green today on reports that it may begin the for its chip stakes sale this friday. Going onnto whats over in singapore. A percent here. We did have singapore deliver a budget that hopes to keep growth above 2 . We did have the second finance minister speaking to us this budget, telling us the is about having a new direction mediumtermgh that hump. He did note that the oil and gas industry is going through a down cycle with Weaker Companies likely to fold. And singapore banks, they have the pain, given their exposure. He also weighed in on the demandy markets, saying is resilient. He said wait and see, whether or be removed. Rbs will now some movers. This one up about 1. 3 . Company, gaining on the index here. Heidi . Thanks for that. Lets get a quick check on the headlines. Australian Prime Minister has described President Trump as a personality with a very big job. Turnbull told daybreak asia that frank and openl conversations with the american president but that they werent domain. R the public australia will consider to push the case for t. P. P. To go ahead United States, which abandoned the deal as one of trumps first moves when taking office. It is vital that we maintain the drive towards more open free trade. Trade means jobs. Nation. A is a trading our future depends on not simply selling things to 24 million but selling them to the whole world. Year,aid, at the g20 last protectionism is not a ladder to get you out of the lowgrowth trap. Its a shovel to dig it much deeper. A small plane with five on board as crashed into a Shopping Mall in the australian city of melbourne. Witnesses say the plane came down and exploded soon after taking off from the near airport time. 9 a. M. Local Police Confirmed five people were aboard but havent released details about casualties. Dashed anye minister hopes that greece may have had about getting their hands on a payment. They are demanding labor reforms before theyll sign off on any agreement. Having previously said these chanceould be the last before european elections this year, the e. U. Agreed to pick up coming days. N the we have to realize that there is no agreement. There is no political agreement at this point. That would be too early. And goodry positive step that the institutions have commonconfidence and a agreement to go back. President trump has picked a new National Security advisor after Michael Flynn resigned over lying about his ties with russia. Trump selected army general h. R. Mcmaster for the post. President hade met several potential candidates to replace flynn after his choice, lockheed martins robert harward, rejected the job. 24 hours a day. This is bloomberg. Well, hsbc is due to report earnings in about three hours from now. Shares in europe have surged more than 50 from june 23 last voted to the u. K. Leave the European Union. Rose has been covering this with a preview. Shes in hong kong. Int are we looking out for these results . Well, one thing certainly, that invests will be looking out hsbc announces, is any science of a share signs of a Share Buyback. You will see that hsbc did buyback lastre year and spent 2. 5 billion on that Share Buyback. Things that of the really boosted the shares, prices as well. Pound,o, the slumping because of brexit. Sold more than 56 since brexit. The most of any major european bank. Now, there are questions of course. There are questions around the thats loan growth, how going to impact hsbc profits and also their sensitive to Interest Rates. Arounde questions brexit, of course, still abound. Neatlythe u. K. Going to get out of the European Union relationship that banks have across the European Union. They may need to restructure the business and incur a onetime cost because of that. Eye on theping an situation but they have a fully functioning bank, based in norce, so there is no need an immediate situation. That is what the bank said. The donald trump issue is an unknown. That could in fact affect trade as explore to places like mexico and china. For hsbc, it is economic and uncertainties that are a key threat for the banks prospects. Isng forward, donald trump probably his administration is probably one of the biggest ones. Track to achieve its targets, including 290 billion of reductions in assets as well. So hsbc hold bloomberg this last month that asia, especially is still a key growth area for the bank. All right. A reminder, of course. Well be speaking exclusive to cfo. That will be at 6 a. M. London time. 2 p. M. There in hong kong. Well, earnings continuing here in australia as well. Trading up. Ltex a down market. Third straight session. But caltex, just over 1 . 17 Company Posted a increase in fouryear profit. Paul has been tracking this story for us. Beneficiary of these rebounding energy prices. A net profit of about 470 million u. S. On replacement cost basis. But it was still a pretty good number. Was down 10 . Ue final dividend, 52 cents, in line with caltexs dividend policy. The shares pulling back a little. 1 now. At one point but well take a quick look at oil as well. Beating. Bit of a fouryear net profit after tax, 90 million. Its the underlying profit that cost. Of course, a big one that were waiting for, which comes local market closes, is bhp. Bhp is expecting to deliver great things. A sevenfold increase to a firsthalf profit on Iron Ore Prices, expected to come in with about a lot of analysts are really going to be watching for what bhp does visavis Debt Reduction or the dividend payout. And Deutsche Bank expecting a of about 28 Cents Per Share there. Of course, the failed talks in regard to their chilean mine. Earnings. Of the just about an hours time until be speaking to the cfo. 1 10 if youre watching in sydney. In the day, well be hearing from the bhps mackenzie 10 30 p. M. Hong kong time. Youre inm. If london. Still ahead, President Trumps a majorda could provide boost fore a bottlemaking billionaire. Making we found out why, later on. But coming up, our next guest says trump is threatening to upend 75 years of Alliance Building in asia and europe. This is bloomberg. All right. You are looking at a live shot of singapore, the lion city, getting intojust the trading day there. We do have a down side of just about 1 10 of 1 , really following the rest of the region. Pretty lackluster day. We did have the singapore government delivering its budget night and the singapore minister saying that housing curb that remains for some time. Watching the developers in the session today. The ones that are still on the sdi. Overall, it is a pretty muted trading day here in asia. Course president s days in the u. S. The market, on account of that public holiday, being closed. The asx down by about a quarter 1 . We had the meeting minutes. Heed to volatility, as well as weakness in the domestic economy. The nikkei up about a quarter of 1 . That is benefiting some of those tokyolisted exporters there. Lets get a quick check on the latest headlines for you. Shares of Tata Consultancy services, the highest in five months, after the Company Approved a buyback to improve returns to stakeholders. Voted to repurchase more than 56 million, more than expected. Ad the companys first Share Buyback comes back after cash boths Department Countries started restricting ahead of agreed curbs. Russia pumped almost 7. 5 million 30,000 more than saudi arabia. And it was the First Time Since more that russia produced oil. The u. S. Is the third biggest oil producer, followed by iraq and then china. Citigroup has agreed to pay a almost 5. 5 million to settle an antitrust investigation in south africa. Authorities say citigroup will also make witnesses available to help prosecute other banks. The South African investigation is the latest into alleged productsy banks of tied to foreign exchange. NamedPresident Trump has army general h. R. Mcmaster as his new National Security advisor. Flynn, who michael resigned over his contacts with russia. Trumps foreign and Security Policies and this bring appointment, lets in robert capland from singapore. Also, hes a senior advisor, very wellqualified to talk about all these things. Robert, great to have you. Lets start off with the new appointment. Were just saying to me you actually know Lieutenant General mcmaster very well, on personal terms. Tell me, what kind of pick is he, and does he also indicate the kind of policy continuity would haveys said happened with flynn . Yes. H. R. Mcmaster, h. R. , as hes called to his friends, along with jim mattis, the new bothtary of the defense, these men are really deep, profound military intellectuals. What that means is that they both had real command in combat they read vociferously. They have thousands of books in their libraries. Had long conversations with both of them. They know greek philosophy, history,military et cetera. They are very deep, personalities, unlike mike flynn, who was just released. A staff officer his whole life. Whereas h. R. Mcmaster and mattis do. This is very interesting. Trump, who isdent not a reader, who is sort of postliterate in a way, who has appointed two military intellectuals in key positions cabinet. Whether thats sufficient to trumps lackident of sense of historic obligation, role in asiacas and in europe, remains to be seen. Thats the thing, isnt it . Because there has you know, the election of trump and also appointments that he has put in place, it has been read by ofe as a sort antiintellectualism. It does seem that he does surround himself with people who are rather aligned with his beliefs and policies, or perhaps of bannon, are also informing him. Do you anticipate will come out on top . Put your finger on the big question. The administration is already places. P into two you have what i call the ideological white house versus the very pragmatic, deep knowledgeve of history, in general mattis, and also rexter, tillerson at state, who, though military man, we know ont tillerson is an expert geopolitics, because he ran the Worlds Largest Global Energy company. Verye know hes been a successful negotiator with the russians. So tillerson, mattis and mcmaster bring very seasoned international and military experience to the administration, whereas the inner core of the administration of that. The opposite now, what will hamper both and mattis is the fact theirhey dont have deputies in place. No deputy secretary of state, no undersecretaries, no assistant secretaries, and in the american system, which is very much a bureaucratic, pseudoimperial system, you cannot operate effectively all your deputies, your upper, middle and middlelevel bureaucrats, in place. So there is a vacuum in the Trump Administration at this point. We talk about this vacuum. A lot is being said about the that could be left or is being left on the global stage vacuum, if a power the u. S. Becomes more inward anding as well as the u. K. Potentially parts of europe as well. Well see how that plays out. Does china step into that role . Say thatfirst let me President Trump is an historical anomaly. First president in modern history of the noted states who has personal, emotional sense of war ii, cold world europe andold war all the responsibility that brings to bear as far as the United States. Way, this situation could be very advantageous to remember, america is a great power in asia, only because it chooses to be. It is half a world away geographically. Only the legacies of vietnam, ii, et cetera, that makes the United States navy essentially Maritime Force in asia. Now, if you have a u. S. President who is not committed a this legacy, this is perfect opportunity for china, theinstance, to step into breach, into the vacuum. In asia,erican allies de facto ally like vietnam, et cetera, sense that america is drifting away in an emotional, attitudal sense, they will quietly hedge and balance in the direction of china. Insidious. E very it will be out of the headlines. Greatina could make a aride in terms of turning unipolar military environment in the western pacific with the navy in charge political andolar military environment. Going to talk to you more about why you see that as dangerous and how that plays out. More after the break. This is bloomberg. All right. Lets get back to robert. Fromwith us in singapore,. Robert, thanks for staying with us. Just before, we were talking ofut this potential shifting asian alliances towards china, away from the u. S. Whatangerous is this, and does a world under a chinese Global Leadership look like . Step up atready to this point . Well, i dont think china is going to supplant the United States. Just complexify the power. A unipolar military environment, well have a multipolar political and military environment. Trumpk when president abrogated the t. P. P. Agreement, for is the free trade pact American Allies in asia and the United States, that undermined, say, 75 years of a historic trajectory, emerging out of world war ii and culminating in the u. S. Socalled pi pivot to asia, bece the pivot to age asia, though te attentionot all the in the media, the pivot was always supposed to be economic. The economic trade pact was to be the icing on the cake. And when President Trump did that, after president obama failed to get it through ofgress, you have a lot American Allies in the region severelyto be feeling disappointed and have no choice but to hedge more in the direction of china, because the United States is a great power in the pacific, only because it chosen to be or has be for the last 75 years. And thelf a world away failure of the United States to go through with this trade pact makes america seem even further away. Are we looking at a leadership crisis for the world . Bremma has called a g0 world. To some extent, we are, because the world of nato, the in europe, the world of the pacific fleet, of japan, southes in korea, taiwan, et cetera, is the world america made. That is, as unstable as the on any given day, the great degree of stability, absence of great interstate conflict is generally ascribed to American Power and american leadership. Feeling historic obligations in safeguarding the europe, asia and to the degree that it can other parts of the world. An american president who is primarily americas own selfish needs, as he outlines you have a situation that we have not faced since the 1930s in the United States. America first isolationism. Yes. Robert, great to have those insights. Leave it there. A plenty more up after the break. This is bloomberg. Ive spent my life planting a sizesix, nonslip shoe into that door. On this side, i want my customers to relax and enjoy themselves. But these days its phones before forks. They want wifi out here. But behind that door, i need a private connection for my business. Wifi pro from comcast business. Public wifi for your customers. Private wifi for your business. Strong and secure. Good for a door. And a network. Comcast business. Built for security. Built for business. Well, it is 9 29 a. M. In hong kong. P. M. In sydney. You are looking at a very gloomy, fog picture of the peak in hong kong there, where market open in just 50 seconds. We do have a pretty gloomy it comes to the markets so far in this asian trading session. Lot of drivers. Chinese stocks had a pretty spectacular start to the week. Surging the most in three months. November. Ince we had the Securities Regulator moving to limit secondary sales, some of those concerns over the excessive supply. We have shanghai, yesterday leading the gains in asia, in eight shares. 1. 8 billion of hong kong that year. Most this were seeing, we are seeing a resurgence. Hong kongmoke its market have open for trading. Therter it looks like appetite is strengthening with the hong kong index adding to mondays gains. Theng a look at some of performance here today, theyll International Rising almost 8 . Thus the most since september 19. Declinentinuing to today. Take a look at some movers. We have pnc process continue to rise. A Department Store operator this alliance alibaba and in anill see alliance that we will see. Take a look at what is going on with finger pores with singapores property stocks. We have 44 real estate stocks in singapore unchanged for now. This morning we had the finance minister talking to has linda talking to haslinda. Recovery in mild home sales for 2016, but the average however average housing prices have slipped some 3 . Land is expanding overseas. 1 3 development down about of a percent today. They are building homes in china, japan, and the u. K. Langnerchristopher warning that almost five years of this real estate curve have hurt contractors, and that will have an affect on banks. Add loans from the construction sector have risen sharply since the curves were introduced. The second finance minister of singapore has said we will have to wait and see if those are removed. Haidi excellent. Thats get a quick check of the first word headlines for you. Hiba could take a graphic a drastic step forward to selling it chip business. The company is considering a plan to raise as much as 8. 8 billion. The report also says microsoft is interested in submitting a bid. The u. S. Vice president has pledged a strong commitment to the eu on the last leg of his european tour. Speaking with the European Council president in brussels, said the ofe menstruation the ways to bolster relations. Pets said the administration will seek ways to bolster relations. Trump has previously said that nato is obsolete. People talkas the about it, they have said, those are words. Lets see what the actions are. Thats going to be the measure in terms of whatever statements are made, how they are reinforced. Haidi james mattis says the u. S. Is not in a rush to seek its oil. He said u. S. Forces would be there for some time, fighting the Islamic State. The resilience of this army took casualties. It has reconstituted itself both equipment and personnel wise. It has already crossed the line of departure and west mosul. This is not something that was a foregone conclusion for army that, only a year ago, many people were questioning. Haidi global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. The australian Prime Minister Malcolm Turnbull says he has had several frank exchanges with President Trump. The details are not meant for the public domain. In an exclusive interview, mr. Turnbull ascribed the american president as having a very Big Personality with a very big job. Several had conversations now, and they have been constructive, frank, and forthright. Had a very deep engagement with the american administration. And every american administration. The americanaustralian relationship is very deep, built of fightingntury sidebyside in every major conflict. It is an alliance, an economic partnership, built on millions of people to people links and family links. It is very strong and very deep. Reporter how do you view him as a man . Hes a Big Personality and hes got a very big job. Reporter in terms of the difficulty of decisionmaking, because this is a brandnew world, he is someone who does diplomacy via social media, via twitter. There is an element of the unexpected. Does that change the way you do with the u. S. New with the u. S. . Know, we pursue our National Interests methodically and consistently. We make our case very frankly and forthrightly when we are speaking to our american friends. Expect, with good friends, we are fairly circumspect about what we say in public. Its important we give very frank advice and frank exchanges with our american counterpart, but we dont lecture them through the media. , to bevery important able to talk frankly as good friends should. Haidi weve been trying to work president is trump the compared to trump the candidate . Do you think he means what he says . That the judgment that youve got to make. President s are always going to , people always assume that president and Prime Ministers mean what they say, naturally. A commentary on u. S. Politics, i will leave that to the collective talent at bloomberg. It is not my job to comment on u. S. Political development. That was the australian Prime Minister Malcolm Turnbull speaking to us earlier. Singapore has outlined a set of measures to help its struggling economy and support the energy and construction industries, which are so dominant. Lets go to our Southeast Asia correspondent. What is it planning to do . Heidi, its the most comprehensive budget. It touched on everything from the need to increase the price of water to raising the retirement age to the need to innovate and internationalize. Singapore is trying to position , andf for the next phase is getting a rising backlash from antiglobalization sentiments. There is a concern that singapore is susceptible to changes in the Global Economy highly dependent on trade. Heres what the finance minister has to say about negating those challenges. Singapore and countries everywhere are facing stronger headwinds to growth. There are uncertainties ahead. To longer term uncertainties. Technology is disrupting business and jobs everywhere. This will continue for a much longer period of time. Haslinda speaking of uncertainty, the minister also touched on the risk of a u. S. China trade war. He said it cant be ruled out, but countries like singapore should be prepared. The u. S. And china are singapores largest trading partners. The implications could be very significant. The minister also touched on the Property Market, the hot topic in singapore. What did he have to say about these curves taking place or not . Youre right. Property is an emotional issue for singapore. It has become an election issue. They may have been squeezed out of the market hands. The big question is whether or not singapores property cap will be removed. The minister pointed out they will be in place for some time. He points to a man being very resilient. Into the trend is going up, it remains historically low. Our economy is still stable and growing. I think demand is still healthy, and our assessment is that these will remain for some time. We have not made any move. To be sure, the cooling measures have helped to achieve a soft landing in the Property Market. Singapore home prices have fallen over the past three years. Still, the minister says housing transactions continue to rise. Singapore has been capping Debt Repayment at 60 of the borrowers income. Its trying to avoid overheating the market again. A conundrum facing so many economies at the moment. Our correspondent for us there in singapore. Coming up, we are speaking to the had of a plastics maker on Donald Trumps presidency could affect them. This is bloomberg. Haidi a quick check of the latest headlines. Google will conduct an independent review into gendered discrimination. Review innced the response to a blog by former Software Engineer claiming she was propositioned by her manager with complaint ignored by hr. Its the latest in a series of saying theyby women are being sidelined by the industrys maledominated culture. The latest that on the demise on ,he internal Combustion Engine there are seven new stations for Hydrogen Powered cars in california. It is targeting 100 sites by 2024. The plant use hydrogen to phase out traditional engine models by 2015. Models by 2050. Had airbus says it is following all the rules when dealing with iran. The Trump Administration imposed new sanctions earlier this month in response to their Ballistic Missile tests. The original president says he sees new Growth Opportunities as long as they are allowed to pursue them. You that we are completely set of the filling all the rules and legal to work with partners in iran. Ready to enhance this and to talk to other potential as long and countries as we are completely allowed to do so. Haidi you can catch the full interview on Bloomberg Markets middle east today. Businesses aren concerned about President Trumps protectionist policies, one tie company sees one thai company sees a bonanza. It is a Plastic Company that hosts the could be a boon for its u. S. Earnings. Tell me why you see this tax policy, the details of which are very scant, why you think it is going to turn out well for your company . Good morning. Thank you for have me here. Aroma four for indorama, we have over half of our earnings coming from the usa. It is definitely something which is quite exciting for us. We are quite hopeful that we will increase our earnings. Haidi are you making decisions based on that yet . We continue to invest. Tech is only one aspect of an investment. Have been in the u. S. For the last 10 years. We are growing in the u. S. We have some smaller investments going on. , and theue to invest u. S. Is one of the largest markets for us. That under improved taxation, we should be able to grow. U. S. , youside of the have identified opportunities in emerging markets. Lets start with india. You are expanding pretty ambitiously in that market. You are very optimistic. Can you talk us through what part of the india market story you are hoping to capitalize on . For indorama, india has a Large Population and a large promise. In the last year, we are now 40 of the market share. Itself is big for us. The way we look at india is that it is 1 10 of consumption we see in china. It is a question of time. I think we are now at the right time. In the of, because it is a large growing market, the u. S. Because it is a large market. Countries, these focus markets for investment. We just completed our Business Plan for the next four years. We announced it yesterday. We are investing about 5 billion in india and the usa. Haidi how does africa feature into that plan . You spoke about being rife with opportunity. Guest yes. Africa, obviously, is a very real continent. We have investment in nigeria and ghana. We have a unique opportunity to grow over the next 10 years. It is something that will not or in largeight amounts, but over the next 10 years, africa, because this population, because there is no other Plastics Company in africa, we see a large promise there. Haidi i find it very compelling and interesting that you see the trump policy come out particularly when it comes to taxes, reassuring for your business going forward. You operate across all of these Global Markets. You are also competing with imports from taiwan, from china, from other markets, as well. Are you not generally concerned about the sort of protectionist policies against trade that are coming through from the Trump Administration . Actually, that has been our Business Model since 2002. We had this Business Model since the haitian crisis of 1997. We didnt want to put all our eggs in one basket. We wanted to diversify our earnings, and today, we have parts of earnings coming from north america, from europe, and from asia. A large highvalue portfolio. What happened to our businesses is 50 is being generated from the portfolio. Of theessities portfolio essential commodities, that has been going for the last five years. We thought of it as a Regional Business area we produce in the u. S. , for instance, for the u. S. Market. Within the u. S. Market, we have sufficient capacity. If there was a curb on imports in the form of import taxes, that would be good for domestic industry. Domestic industry is quite competitive in the u. S. Indorama is a truly integrated Value Chain Company in the u. S. , so we havelymers the entire value chain under our control. I have no concern. Its probably going to be a little better for us. Haidi great to have those insights for us. Thats the ceo of indorama ventures. He joins us from bangkok. One thing on the bloomberg we would like to bring your you will not only be up to watch us live, but see previous interviews you might have missed and the bloomberg functions we talk about here on bloomberg tv. Become part of the conversation by send us instant messages during our shows. This is for bloombergtechtv drivers bloomberg subscribers only. Check it out at tv. This is bloomberg. Haidi chinas Budget Airlines may be trading at the most expensive levels in 18 months. The brokerage cip says they could benefit further from the countrys economic recovery. Lets get more from beijing. These Airline Stocks have seen some nice gains, some nice out student, even. Are they still going to go higher . Thats according to ,ee icc, the brokerage cicc the brokerage. They are bullish on china eastern. The main reason behind it all is the economy. They see the recovery being on strong footing. Yearuan strengthened this is also a factor, enticing travelers oversee. Travelers overseas. On one hand, youve got 18 month highs with valuations. The other hand, its a bargain still. How are they coming to this conclusion . Reporter thats right. Of hong kong trade shares the socalled big three have rallied. They have led gains in a impact of asiapacific airlines this year. The highest level since 2015. That still makes them really cheap when compared to their peers. Aboutsouthern trades at nine times estimated earnings. That compares to an average of about 13 times for that index i mentioned and 22 is the valuation for singapore airlines. , they are a bargain. Haidi emma obrien for us they are in beijing. Later on we will be live at the aviation faced double aviation festival interviewing the top executives of the industry. Coming up in the next hour, we speak to the head of Australian Oil and gas explorer oil search for his take on the profit plunge. This is bloomberg. Haidi its almost 10 00 p. M. In hong kong. , this is Bloomberg Markets asia. Hsbc seems poised for more Share Buybacks. Results come out and just a few hours. Oil shares dip. We will be speaking live to managing director peter butler. The australian Prime Minister tells us in an exclusive interview the president is a Big Personality with a big job. The absence of wall street off for the president s day holiday, we do have trading in indonesia getting underway. Heres sophie with a look at the markets. Sophie stocks in jakarta ,oining the nikkei and shanghai climbing tohe the highest since 2015. We did get south korea reporting a 26 on year jump in exports for the first 20 days of february, signs of an economic recovery, perhaps. Day,of the movers of the we are keeping a close eye on toshiba, set to seek at least ¥1 trillion in a sale according to people familiar with the matter. We see Energy Stocks climb across asia, with oil sticking above 53 a barrel. Investors are backing away from gold slipping,o although it is holding near the highest level since november. The dollar on the rise following officials saying that a march rate hike is not off the table. The fed will be releasing minutes of its latest meeting this week. Oil sticking above 53 as i noted earlier. Take a look at the bond space. That rise of the dollar, we are seeing treasuries fall to the 10 year yield, climbing over 2. 4 . The rate on the aussie tenure also climbing. Yield also rising to 1. 08 , the highest since february 2014. Thanks for that. For the first word news now, yvonne has the headlines. Yvonne hi there. Australian Prime Minister Malcolm Turnbull has described President Trump as a very Big Personality with a very big job. He has had several frank and open conversations with the american president , but they werent meant for the public domain. Australia will continue to push the case for tpp to go ahead without the u. S. , which abandoned the deal is one of trumps first moves in office. Vital that we maintain the drive towards more open markets and free trade. Trade means jobs. Australia is a trading nation. Our future depends on not simply selling things to australians, but to the whole world. ,s i said at the g20 last year protectionism is not a ladder to get you out of the low growth trap. It is a shovel to get much deeper. Today it much deeper. A plane crashed into a building in melbourne. Everyone on board was killed. Euro area finance ministers any hopes of getting their hands on new aid payments ok. Tax demand that they pension and labor reforms before an agreement. These would begin last chance before european elections this year. The eu agreed to pick up discussions in the coming days. We have to realize that there is no agreement. There is no political agreement at this point that will be too early. Its a positive and good step that the institutions have enough confidence and a common agreement to go back. Haidi President Trump yvonne President Trump has picked a new National Security advisor after Michael Flynn resigned over ties to russia. He has nominated general mcmaster for the position. Harwood rejected the job. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Im a yvonne man. This is bloomberg. Haidi thanks. Asia is due to report earnings of you next couple of hours. Shares in their biggest bank have surged one and 20 since june last year when the u. K. Voted to leave the European Union. Roz has been looking at this for us. She is outside the main headquarters in hong kong. What are we looking for in this set of results . Investors will be listening very carefully to see if there are any more signs of a Share Buyback. This shows how the bank shares have been performing in the last year or so. The white line being shares in london, the blue being the pound. Stock in london has surged more than 66 since that twice third of june last year, the most of any major european bank. Thats partly because of that slumping pound. Hsbc spent 2. 5 billion in Share Buybacks last year. Year, the ceolast indicated that more buybacks , so theypossible over are giving Share Buybacks a big boost last year. Haidi what are the key challenges we are looking at in terms of profitability . There are certainly some questions, which investors and analysts are looking at. Ne is weak loan growth that hasnt been an issue for hsbc. Political and economic instabilitys are probably the biggest challenge is to hsbc profitability going forward. What will donna trumps Donald Trumps administration bring in the coming weeks and months . Bloomberg intelligence says the bank is on track for 2017 targets, including up to 5. Illion asia continues to be a key region for hsbc thomas especially china and the po river delta. It says that although there has been a slowing and chinas economy, it will continue to be focused on this area. Byy pushed back the deadline maybe 18 months to two years. There are questions about brexit, as well. Hsbc may need to adapt its business. Haidi a lot to look out for. Thats a preview of hsbc earnings. You can turn to the bloomberg for more on hsbc results. At tv live go to get results from bloomberg editors as these become available, and some analysis, as well. Ly toll speak explosive hsbc ceo. Ahead, how singapore may turn to taxation to solve its budget problems. But next, after suffering a profit fall, can be stabilizing oil price gives oil search a boost . This is bloomberg. Haidi a quick check of the latest business headlines. The board voted to purchase more than 6 million shares. The companys first Share Buyback comes after cash and the investments well to nearly 6. 5 billion at the end of last year. Russia overtook saudi arabia as the worlds biggest crude producer in december. Both countries started restricting output. Rob russia pumped out more than saudi arabia, the First Time Since march that they have produced more oil. The u. S. Was the third biggest producer, followed by a rock and china. Citigroup has agreed to pay a penalty of almost 5. 5 million to settle an antitrust investigation and south africa. They accused they were accused upper to spending and an alleged cartel. The South African investigation is the latest into alleged rigging by banks tied to foreign exchange. London shares will be close he will be closely watched and what is expected to be a big boost for bhp billiton. Reporter thats right. They brace for an impressive results. The latest round of analysis we have is for 2. 94 billion profits for bhp billiton. That is on the back of higher coal and oil prices. No debt expected to be 25. 9 billion. Theyll be some of the commentary analysts are watching out for when these results released. What is going to happen with bhps net debt . What will it mean for the dividend, Deutsche Bank forecasting a dividend. Weve also had oil surge and count tax results and caltech results out earlier today. What was the story there . Lets take a look at caltech. Shares are performing reasonably well. 1. 08 , up more than 2 at one stage. The market responding pretty well. A final dividend of . 52 from caltech. We are seeing oil shares declining now 2 . There was a return profit of about 19 million. The underlying profit was perhaps a bit of a letdown, down 70 to 107 million. Haidi we have been in the thick of things when it comes to earnings. What else are you looking at as we get into this week proper . For the rest of the week, waiting on bhp, of course. You caught me at a disadvantage here. I dont have my list in front of me. Haidi i was going to talk more about bhp, because we have had this 18 gain when it comes to the Iron Ore Price. We are expecting that to factor in. Whether it isn sustainable or not . Reporter that will be some of the commentary around this. We have been talking about Iron Ore Prices for quite some time. Some sources at the end of last year just keep on gaining and gating. Analysts calling for that Iron Ore Price to come off the boil. However, it refuses to do so. Plenty forecast that the iron ore process Iron Ore Price will drop, but it has not been happening. For the australian government, every move means a move to the bottom line. Will be hoping that Oil Price Holds steady. The last budget was predicated on an oil price. More on that coming up, because we are asking the question, can be stabilizing oil price give a oil search a boost . These results didnt please shareholders. We will speak with the managing director. This is bloomberg. Haidi oil search is among torgy producers seeking avoid the worst oil crash in a generation. They want to forge an agreement on developing Natural Gas Resources and about again he. Paand upon beginning and pua new guinea. Addressing the last piece, uncertainty hasnt stopped the development of the worldclass project. Other mining and resources projects around the country, certainly you need to manage them well. We have very strong support from the government, with png, and with the landowners from project areas. I think we are pretty comfortable that all of this can be managed. Png economy is very reliant on resource incomes. In reality, the expansion of eng of png remains a key priority for the development of the economy in the country. Haidi in terms of cost cutting, have they run their course . The furthernk optimization of the business, whether it be in our existing businesses or in future projects, you are also seeing opportunities now. We have a higher oil and gas price. We have a Higher Oil Price than we did 12 months ago. We are starting to see some opportunities reengaging and doing some further investment in oil. Weve taken 30 out of that cost basis since 2014. We actually reduced our unit cost of production down to just over eight dollars a barrel, a very competitive number. There is more to come, but we are starting to see opportunities where investment works and is attractive for us. Haidi where do you see the oil price story going from here . Tightlybeen really range bound. It seems investors cant work out what is going to be gone a catalyst. Is it increased u. S. Drilling activity or these opec supply cuts . Obviously, i believe oil price will stay pretty much where they are at. Haidi are you encouraged by what opec is doing . Guest i think we are all encouraged by the discipline we see. That might be born in part out out ofes ration some desperation. At the end of the day, the the supply the supplydemand balance, i dont see much happening to the oil price in 2017. I think if disciplines continue the slow rise, 2018 and 2019 maybe possible. Years ofaken four substantial investment. Sooner or later, the project is not coming through because of that like of investment and will impact the supply scenario. In the lng , where d. C. Pricing for the rest of the decade . Do you see that demand window shifting forward . Guest weve been encouraged by what we have seen in the last six months or so. Demand worldwide when up about 7 last year. The new customers are pretty strong. Demand in india and china is pretty strong. We think the supplydemand balance which we thought was probably more 22, 23 is more into the early 20s, maybe 20, 21. I think thats encouraging for new projects for png to play into that market window. Haidi you mentioned chinese demand. Are these the players that are going to come and take out some of the growth that we have had from japanese demand . Guest japanese demand is moderating. I think it will continue to be that way as they rebalance their energy portfolio. I think its more than india and china. That is certainly where a lot of the demand is, but there is also a range of new customers. I stand, the middle east, egypt. A whole range pakistan, the middle east, egypt. It is a tradable world commodity at the moment. There is a connection in pricing and supply around the world. I think that will encourage competition, especially from the u. S. Pricingf reasonable gas will stimulate demand, and i am very encouraged by that scenario. Haidi the market in lng and in guinea, how much progress to anticipate making in 2017 . Guest weve had a number of discussion with those parties over the last 12 months. Discussions the have been delayed by clarity on is entering. Mobil thee is a transaction and Canadian Court which approved the transaction to go ahead. That is the trigger to meaningful discussions on how the various project can cooperate and work together. The size of the economic price for that quiet operation is enormous. In these sorts of levels of resource pricing, i think private and Big Companies like exxon cannot ignore it. Generation, a a crash in crude prices. Is the worst over . Guest i think ive seen three and my work experience. Three in my work experience. I think it is coming much more into balance. Decline and industry cannot only key will see the oil price go up dramatically. I think a steady growth, slow growth in oil price is more likely now than it was 12 months ago. You cant run your business on a Higher Oil Price, so i think you got to run your business lean and mean. Your capital efficiency has got to be there. Haidi what is your barrel price for this year . Guest i think its probably in the 50, 55 a barrel consistently through this year. I think thats a pretty reasonable back. , the here it in Australia National conversation has been dominated over energy. Is australia facing an Energy Crisis as we heard yesterday . Guest i think that what we are seeing in australia is a failure , both at the state and federal level. I think there has to be a real debate and a coordinated debate on how Energy Supply can come together across this country. Shortesthink, with the with the shortage of gases we have, many areas of the country are now blocked out. Strong push for renewables, quite rightly. The balance of how that Energy Picture can come together must be a combination of some progressive phase to take up the transitional fuel such as gas. I think a more coordinated approach to renewables, all of that at the two a Higher Energy price for the consumers and business. I dont think we can get around that. But it needs to be properly managed, and i dont we are doing that well. Haidi is there an ideal mix . Guest theres no doubt there a mix where gas plays a role for many years to come. I think we will see cole diminished in its importance. Its got to be a sensible debate, because renewables arent available all the time. You have to have backup. I dont think you see that coordinated approach on energy and the australian mix at the moment. It is so important to the future of the nation. The free trade expansion you are hoping to do in png. As a something that is shared with others . Guest its shared by the government. How it comes together is going to be the challenge of 2017. The size of the economic prize is enormous for us all, and really critical for the future new ment of papuan papua new guinea. What australias Prime Minister had to say about his relationship with President Trump. Haidi it is 1 29 in sydney, time for a quick look at the first word headlines. To sheba could begin the step of putting its crown jewels, the chip business, for sale. Sources tell bloomberg the company is considering raising 8. 8 billion. Conditions of the sale include maintaining employment, and Domestic Production and development. The report also says microsoft is interested in submitting a bid. The u. S. Vice president has pledged a strong commitment to the eu on the last leg of his european tour. Speaking with a European Council president in brussels, pence says the trumpet ministration would look for ways to bolster relations. The former secretary of state Madeleine Albright told bloomberg that pence had helped reassure america. It was an important speech, in terms of reaffirming our commitment to nato. Talk about it,le they have said good speech, lets see what the actions are. That will be the measure, in terms of how the statements are reinforced. Haidi defense secretary james mathis says the u. S. Is not in oil. To secede its to seize oil. Iraqiavel ban included citizens. He says he was that she says forces will be there for time. He says the forces will be there for some time. It took casualties. It has reconstituted itself, both time. Equipment and personnelwise, and has already crossed the line of departure, going against the enemy in west mosul. This was not a foregone conclusion for an army that only a year ago many people were questioning. Haidi this is Bloomberg Markets asia. It is a pretty tepid trading day in asia. Lets get the latest. Japan is going into the lunch break with half a percent higher. Shares are climbing for a second day at mmid the weakness in the yen. Tf forj has buought e the last three trading days. We see the biggest boost in tokyo. Yokihamaubber rubber, getting 5 . Shares are dragging however, on the index. On the decliners side of the a downgradedo have from snbc to underperform. We also have the industrial machinery maker ntn rising. Pauls letter elsewhere in higherion, the cospi is by 1 . Samsung shares are climbing. Looking at what is going on with the hang seng come of about. 1 . Chinese insurers are leading gains on the hscei. A ping on insurance. This says china will consider easing limits on Foreign Ownership and life insurers. We are also seeing chinese autos climb in hong kong. We did see sales climb 90 in 2016 and car sales will likely continue growing this year, despite the small vehicle sales tax being increased. Just a quick word with byd, we did have china daily reporting that it supplied 100 electric vehicles to singapore taxi. It is the First Chinese company to enter the singaporean taxi market. Haidi thank you for that. Russia has overtaken saudi arabia as the Worlds Largest crude oil producer. Ben is here with the latest. Is this just a fleeting moment at the top of the rankings for the russians . Yes, in december, russia overtook saudi arabia. Is probably likely to continue. We have seen those cuts from opec and other producer nations cutting more than what they pledged earlier this year. They are below 10 Million Barrels a day. I would expect russia to retain that title for at least the coming months. They have some bragging rights there over saudi arabia at the moment. Haidi has this rivalry between russia and saudi arabia extended into elsewhere . Hast is a rivalry that extended into asia. Russia overtook saudi arabia as the biggest supplier of crude oil to china in 2016 for the first time ever. That is primarily driven by the independent refinements. We have the proximity there, closer to russia. They are driving those sales. Strongis actually in a position at the moment, not only for bragging rights, but they are muscling into china or saudi arabias most important market in china. Haidi how times are changing. It will be a very interesting year indeed. Ben sharples there for us in hong kong. Singapore has outlined a set of measures to help its struggling economy and support the energy and construction industries, which are so crucial to growth there. Lets get the details from our Southeast Asia correspondent. What does the government have in store to slow growth . S you know what, the budget i right to address challenges across sectors, covering every aspect of singapores economy. Given the countrys aging population, the retirement age 67. Been raised from 65 to is providing support to Small Businesses, helping them innovate and go global. Is steadying revenue. As you know, they are trying to position itself for the next phase of growth, the next 10 years, amid rising backlash from the antiglobalization sentiment and weaker consumer demand. There is growing concern because singapore is susceptible to changes in the Global Economy. It is after all, highly dependent on trade. Here is what singapores second finance minister has to say about navigating the challenges. Singapore and countries everywhere are facing stronger headwinds to growth. There are uncertainties head. They are medium to longer term uncertainties. And technology is disrupting the business everywhere. This will continue for much longer. Haidi the minister also touched on the risk of the u. S. China trade war. He says it cannot be ruled out and countries like singapore must be prepared. U. S. And china are the largest rating partners of singapore. The implication could be significant for the rest of the region and the world as well. Haidi that is right. These shifting alliances. The minister also touched on the Property Market. This is a hot topic abroad. What did he have to say about these limits that have been put on the sector . Well, those hoping for the property curbs to be removed will have to wait a little longer. The minister says the curbs will stay for some time, his own words. That is because demand has been resilient, despite efforts to curb the sector. The cuts have also help the property sector. It is an emotional issue in singapore. When prices rose to record highs, singapore was priced out of the market, forcing the government to address the issue by putting limits. For example, capping Debt Repayments at 60 of the borrowers income. There has been so much speculation that those limits will be removed soon. Here is the mr. Again on that issue. Here is the minister again on the issue. The Interest Rate remains at a historically low level. Our economy is still growing. I think demand is still healthy. From our assessment, these sectors will remain for some time. We have not made any move in the budget. The jury is still out when the property curbs will be removed. When we spoke to the ceo of capital land, we were told prices are showing some sign of stabilization and there is no compelling reason to make any move anytime soon. Haidi thank you for that, has. The australian Prime Minister Malcolm Turnbull says he has had several frank exchanges with President Trump. The details of these conversations are not meant for the public domain. In an exclusive interview, Malcolm Turnbull described the american president as a very Big Personality with a very big job. Malcolm turnbull we have had several conversations now. They have been constructive, frank and forthright. And we have a very deep engagement with the american administration, and every american administration. The australianu. S. Alliance relationship is very deep. It is built over a century of fighting sidebyside in every major conflict. It is an alliance, an economic partnership, and is built on millions of people to people links. How do you read him as a man, though . Malcolm turnbull he is a very Big Personality with a very big job. In terms of the added difficulty of decisionmaking, because this is a brandnew world, he is somebody that does diplomacy by social media, by twitter, there is an element of the unexpected. Does that change the way you deal with the u. S. . Malcolm turnbull no, we pursue our National Interests methodically, calmly, consistently. We make our case very frankly and forthrightly when we are speaking to our american friends. But as you would expect, with good friends, we are fairly circumspect with what we say in public. It is important we give very frank advice and have frank exchanges with our american counterparts, but we dont do it we dont lecture them through the media. It is very important to be able to talk frankly, as good friends should. Haidi in the markets we have been trying to work out, you know, what is trump the president and trump the candidate. A lot of that has come to fruition, in terms of pulling out of the tpp. Do you think he means what he says . Malcolm turnbull that is a judgment you have got to make. I think president s people always assume the president s and Prime Ministers mean what they say, naturally. On in terms of a commentary u. S. Politics, i believe that to all the collective, talented bloomberg. It is not my job to comment on u. S. Political developments. Haidi that was the australian Prime Minister, Malcolm Turnbull , speaking to me earlier on daybreak australia. Greece failed to come to an agreement with its creditors, but hope is not lost just yet. We will hear from a former greek finance minister, next. This is bloomberg. Haidi a quick check of the latest business flash headlines. Uber will conduct an independent review into gender discrimination to be led by the former u. S. Attorney general eric holder. The review was announced in response to a blow by a former Software Engineer. She claims she was propositioned by her manager. This is the latest in a series of accusations by women who say they have been sidelined by silicon valleys maledominated culture. The latest bid on the eternal Combustion Engine, shell and toyota are building several new fueling stations for Hydrogen Cars. They are trying to address the lack of fueling stations and is targeting 100 sites by 2020 four. Toyota plans to use hydrogen to phase out the traditional models by 2050. Increase Financial Support of air berlin after they failed to convince bondholders to wait for repayment. The airline will buy 57 million of new convertible bonds after almost all of air berlins shareholders to rejec rejected n exchange. Euro area finance ministers have dashed any hopes greece might have had. Creditors are demanding the Athens Institute tax pension and labor reforms before they will final font an agreement. Before they will sign off on an agreement. The core problem remains debt relief. Debt is unsustainable over the next five years because redemptions are very low, very small. Interest rates are very low. Beyond that, if you move into the future, even if you dont purchase the entire debt because i dont think anybody knows we dont know where moral will be in 2060. Germans are not willing to accept this. The euro group has said they will do more on greek debt relief. It is just that with the german elections coming up, the germans are not willing to do the additional steps, which are necessary to specify what kind of measures, short of a haircut, because everybody understands it will not be a normal haircut. An extension of the insurances, pegging the rates at todays low levels. Manus the germans want to see more austerity. Austerity intore the greek system without it being, i think what one of the irish ministers called a comedy straw that breaks the camel called it, the straw that breaks the camels back . Germans and the euro group are talking about a promise of this target over the next 10 years of 3. 5 . Raoul is that realistic . No, i think it is doable, but at a huge cost to the economy. The question is, do you give the economy some room to get out of its slump, which has been there for seven or eight years. A higher insist on target, which makes it slightly more sustainable over the mediumterm. Target on this, a lower could be better for the economy and everybody concerned. The oclaro has signed on an agreement the euro group has signed on an agreement with 3. 5 . They do not want to change it, with the dutch elections coming up any german elections. At the same time, the germans would like the imf to stay in the program and you cant have it both ways. You cant have the imf in the program without accepting what they are proposing. Manus let me put it to you the other side, the populist view. The greeks can pay come along the greeks cant pay, wont pay. This is the craw in the german throat. Cant pay, wont pay, dont view. This is not a populist view. This is correct. We have lost 25 of greek gdp. We have over taxation at the moment. So, it is impossible to go on. This is why you do not need additional reserves. That is why a lower rate makes a lot of sense. Haidi that was the former greek finance minister George Papaconstantinou speaking to our manus cranny. Man, will he be able to rekindle growth after almost four months of boardroom turmoil . We are live in mumbai, next. This is bloomberg. Haidi this is Bloomberg Markets asia. Shares surged as the worlds shipperiron ore revealed a shareholder restructuring. The brazilian liner has been controlled by tension funds and banks for two decades. The expiration of a shareholder pact could see stop expiration. A shoulder a shareholder cant own more than 25 without an ipo being held. Burger king could be looking to purchase popeyes kitchen. They are in advanced talks with popeyes and a deal could be announced this week. The two have failed to reach an agreement in earlier talks, but burger king renewed the interests last week and made a mainly cash offer for the 1. 4 billion company. Internet entrepreneur kim dotcomm has claimed a major victory in his longrunning exhibition case after the High Court Ruled he was not guilty of copyright infringement. The court did find he was eligible for removal to the u. S. On the grounds of conspiracy to defraud. The u. S. Is seeking to extradite dotcom. He says he will appeal the ruling. We are counting down to the opening of the mumbai session now, just over one hour away. We have a pretty tepid picture when it comes to asian markets so far in the session. Closedrkets are when it comes to the president day holiday and asian stocks army entering. Indian futures are showing a little pop at the open by about. 2 . By. 7 . Y 50, up a new chairman after almost four months of boardroom turmoil. We are now joined from mumbai. We are finally at this point, but a lot of challenges for the newcomer. A bunch of challenges really. Indiastaken one of bestknown executives. Tata group takes over today. This comes out after the group mistry. Oubt cyrus we finally have somebody who will take over. He will have to reestablish the relationship with the chairman tata and the tata trust. They own about 2 3 of tata sons. More importantly, it basically operates with charitable activities, an important piece of what the tata group stands for. Second, his managing perception. They must conduct new Board Directors over a period of time and show the world he is the boss. Chandra biggest obstacle will be perception, sending the message out to the world that he is his own man and not here to do tatas bidding. He will have to bring back focus on business, focus on growth, and derive weaker, independent tata companies. Haidi those are just the issues and the challenges when it comes to image, managing morale. What are the major problems that these individual Tata Group Companies that chandra also needs to fix . The unfortunate bit is not just the relationship that he will have to reestablish with cyrus mistry. It is also that a lot of bad blood was spilled. A lot of dirty laundry has already been washed in the public. He said there has been a lot of legacy hotspots, the problems with the communications business, its power business, so on. Chandra would do well to take some of these problems head on. Some of the acquisitions they have done globally that have gone wrong will have to be fixed. Tatas problems with the joint venture and cutting off with what has been a lake of the problem will have to be fixed. Here is an interesting statistic. Nearly 90 of the corporate profits of the group come from two companies. It would be prudent for him to figure out a strategy that can hedge the longterm prospects of the group by again, weakening growth in the independent areas, so the group is not entirely dependent on these two entities. I think, lastly, the problems of the last few months of taken the groups focus away from some of the growth areas in india. The tata group is virtually absent in the new economy. It would do well for somebody who has been in the Technology Space to bring focus back on growth and investment. The closing of one chapter that has been for a difficult, and there are certainly challenges ahead for tata group. Sheri will be with us ahead on Bloomberg Markets. What are you watching for us . We are just about one hour away from hsbcs fourthquarter results. The stock has surged more than vote, and the brexit also because of the falling pound. We will take a look at my hsbc says. Also we will have the chief agent economist of Standard Chartered breaking down the risks around asia. This is bloomberg. It is almost 11 00 in hong kong and 2 00 in sydney. We are in the middle of the asian trading day. Welcome to Bloomberg Markets asia. We are counting down to hsbcs earnings with british banks surging after the brexit vote. Why are then, analysts getting more negative . Australians Prime Minister backs infrastructure investment. Our exclusive interview with Malcolm Turnbull. And the chairman challenges. We look at what is on the agenda he tata sons new boss as takes charge of the 100 billion conglomerate. Investors in asia are giving up haven assets and taking on some risk. Also, some consolidation in asian assets as we look forward to the Federal Reserve minutes, not to mention the Political Developments out of europe. Take a look at the function gmm. The south korean kospi is gaining 1 , the highest level since 2015. Proxyrean yuan is a good to see what investors are looking at when it comes to the region reacting to Donald Trumps presidency and policies. Take a look at the japan nikkei, up. 0. 5 0. 4 have the yen falling against the dollar. The boj has been purchasing etf in the last three trading days, giving some support to the equity markets. Ore,at the surge in iron gaining 4. 7 , at the highest level since 2014. We are hearing government mandated supply curbs. That could boost prices. That speculation, just leading the metal higher, along with other metals, although Precious Metals are losing ground with sentiment. Ff on markets in asia are following treasuries lower, resuming trading after president s day. Take a look at japans two year, 1. 2 basis points higher when it comes to the yield. This is a snapshot of what is happening across markets in asia. Lets get the first word news. Australian Prime Minister Malcolm Turnbull has described president as a very Big Personality with a very big job. Daybreak australia that he had several frank and forthright conversations, but they were not meant for the public domain. Australia will continue to push the case for the tpp to go ahead without the u. S. Vital we maintain the drive towards more open markets and free trade. Trade means jobs. Australia is a trading nation. Our future depends on not simply selling things to 24 million australians, but to the entire world. As i said at the g20 last year, protectionism is not a ladder to get you out of the low growth trap, it is a shovel to dig it much deeper. A small plane with five people on board has crashed into a Shopping Mall in the australian city of melbourne. Everybody on board was killed. Witnesses say the plane came down and exploded soon after, taking off from the nearby airport around 9 00 a. M. Local time. It is the worst Civil Aviation accident in the state of the tory a in 30 years. Euro area finance ministers greece may hopes have had. They are demanding the labor reforms before they sign off on any agreement. The last chance before european elections this year. The e. U. Agree to pick up discussions in the coming days. We have realize there is no political agreement at this point. It is a positive and good step that the institutions have enough confidence and common agreement to go back to athens. President trump has picked a new National Security adviser after Michael Flynn resigned. He has selected army Lieutenant General h. R. Mcmaster. He met several potential candidates to replace general flynn. Robert hayward rejected the job. Global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries around the world. This is bloomberg. Thank you. We are less than one hour away from one of the weeks highly anticipated corporate results. Shares in hsbc have surged more 23 last since june year, when the u. K. Voted to leave the European Union. Rosalind chin is outside the banks Main Building in hong kong. What are we looking for in these results . Rosalind will there be more Share Buybacks is one of the key things investors will be keeping peeled for. Ield this chart shows how hsbcs shares have been doing against the pound last year. The Share Buybacks are helping to push the shares higher, that is the white line. The b llue line, that is the pound, and you can see the steep drop. Ages bc has been 2. 5 billion on Share Buybacks hsbc has spent 2. 5 billion on Share Buybacks. More buybacks could be possible over the mediumterm. Hsbc stop in london, surging , because of cents those buybacks and the weaker pound. Any recovery in the pound could affect hsbc shares and performance. What we have for the Fourth Quarter bloomberg survey, average estimates are estimate in profit at 3. 70 billion with the total income 12. 4 billion. We will see whether those come true in an hour from now. You mentioned that a recovery in the pound could be a challenge for hsbc. What else could hit the bank . Rosalind well, there are questions over the bankssensitivity to Interest Rates, also weak loans growth. Of course, there is brexit, the big issue banks still have to contend with. Thinks hsbc might need to restructure. Hsbc says they have a fully functioning unit, so they have no immediate need to make decisions on european issues. Of course, there is also donald trump, now. He and his administration are affecting almost everything right now. Certainly, the uncertainties over the policies in that administration are a factor into what might happen for ages bc. Hsbc. Ror exclusive revenues are linked to trade flows from mexico and china. Outlinedump has perhaps, maybe having imposed some protectionist policies against them, but hsbc is on track for the 2017 target, including 5 billion of cost savings. We will see what happens one hour from now, but they are still maintaining that asia is a key focus, especially china. Right, but there is also a lot of speculation on who is going to succeed the chairman and Douglas Flint. Are investors going to the any clarity on this front . Going to get any clarity on this front . They did say last march it is going to start looking for a new chairman to replace Douglas Flint. This will take a considerable amount of time. Bloomberg sources say they will not make any advancements around or alongside the results announced today, though hsbc said they would nominate somebody in 2017. Of course, we are only in february. Two of the most long serving heads of a big european bank, they have been for a long time. Since 1980 and Douglas Flint since 1995. The last few years or so, producer presence, down. Aey have implemented longterm sentiment for the banks and many are wondering who will be next. Rosalind chin, reporting from hsbcs headquarters. A reminder, we will be speaking exclusively to hsbcs cfo at 6 00 a. M. London time and 2 00 p. M. In hong kong. You can turn to your bloomberg for more on this. Go to tliv to go commentary and analysis. A pretty positive day for markets across asia. Lets get the details. The turnaround from the earlier chart we saw across the region. We are seeing a strong showing from the kospi and shiny shares. Korean shares are up over 1 , the that showing since july of 2015. This morning, we are getting south korean reports, 26 on exports for the first 20 days of february. A sign perhaps, of a recovery. Look at the hang seng, we do have Bell International leading gains in the Consumer Discretionary space, Credit Suisse raising the stock ratings to outperform. Credit suisse does expect footwear profits to stabilize in 2018. Bell is chinas biggest fashion shoe retailer. Amongmeeting gains insurers today. China is considering easing limits on Foreign Ownership of life insurance. We are seeing casino stocks and Galaxy Entertainment in the red. Elsewhere in the region, we do have the singapore straights down. 2 , falling for a second day after mondays budget reveal. The second finance ministers told us property curbs will remain for some time. This is at the stage its thirdbiggest this is Southeast Asias thirdbiggest property developer. City development is heavily exposed to the singapore market and is falling today. In australia, i want to focus on oil search, falling over 2 after posting a 70 drop. We were told that he does not see oil going up dramatically in to 55 aging 50 barrel. Wti is holding above this 50 mark. As for brent, there has been a Holding Pattern around the 60 a barrel mark. He expects brent to average the dollars this year and 70 in 2018. Two average 60 this year and 70 in 2018. In the same conference call, kwan says they want to hold before aramco the listing. We will be live in sydney today can he the headlines and discuss the highlights of our exclusive interview with the australian Prime Minister, Malcolm Turnbull. Coming up next, we ask standard eesrtered why and where it s a mismatch on the market. This is bloomberg. This is Bloomberg Markets asia. Im shery ahn. One of our top talking points has been the reaction to singapores budget. There is speculation that any attempts to ease pressure on public spending could mean a rise in taxes. Wong told us it was something the government would have to consider. Expenditures will continue to rise. This is for infrastructure and health care reasons. Revenue means taxes, but we will do it in a way that keeps our economy growing. Having a system ensures that singapore benefits. Butont say what it is yet, we are starting this and will make a decision in good time. Shery taxes rose, the ceo of the classics maker told bloomberg that he hopes President Trumps tax cuts and interest curbs could be a boone for u. S. Earnings. We have about half of our earnings coming from the usa. Therefore, this is also the country where we have our highest tax outflow. We have a tax of about 3. 8 . Definitely is something that is quite exciting for us and we are quite hopeful that when that happens, it will help our earnings. Shery another ceo, trying to predict the policies of the u. S. The head of the clsa told us that when it comes to President Trump, it is still very much a case of wait and see. I think that when his cabinet sits down and when his people sit down they will have a very rational viewpoint. There he certainly, they need to understand what americas best interests are, which i dont think are putting up trade barriers with the rest of the world. Until we see exactly what those policies are, until we see exactly where europe is going, will we see this whole movement, we dont know what is going to happen. Shery that is the word from asia. Our next guest says the market seems to optimistic about the seems too optimistic about the u. S. And there is a mismatch between sentiment and likely activity. Lets get more from the chief economist from Standard Chartered. Lets talk about the u. S. Reflation story, because you dont buy into it. Why . It is more of a case of the market looking at all the potential good outcomes you could get from a u. S. Tax package, from infrastructure spending. I think we are really already in the stage where the reality of getting this implemented is starting to kick in. It could be more drawn out and may be more of a downward trend the markets think. That is a big difference between what we are thinking in terms of growth. It should be better than last year, but not that much. Shery so, what should markets the focusing on . I think it is a question of, will he get tax cuts that are good news. Once you get that, that could be the perfect time for getting into emerging markets, or investing in carry type trades. We dont think we will see the u. S. 10 year yield burst through 3 . That could be the top, even on a multiyear basis. Shery you are coding the u. S. 10 year yield around 3 . That is right. Shery one of the problems when it comes to investing in emerging asia is the high leverage. Everybody is worried about this collapse. You have compiled a list of countries that are on high risk and medium risk. Lets take a look at that graphic we have prepared for you. We have the usual, china, japan up there in the high risk category. In the medium sustainable category, south korea, thailand, and the philippines. Lets talk about china here, because it is currently trying to deleverage. How much are these efforts going to help in limiting the risk . There are so many policy objectives china is trying to target at the same time. While the leverage exposure and risk is high, the probability that we would assigned to something going very wrong, at least this year, is very low. It is something people are focused on, i would say almost overly assessed about. The big difference here is, there was an incredible buildup of debt. But it was all very concentrated in corporates. They also have a lot of assets and the ability to be able to muddle through for quite some time. At the same time, we are seeing an increasingly Rapid Household debts growth, but that is coming from such a low base. We are not worried about that yet. Shery that is a different story for south korea, isnt it . Household debt, we got the figures 15 minutes ago from the bok. Household credit in the fourth number. It is a high again, record debt levels for household. Why did you put south korea in the medium sustainable section . You can talk about japans credit ratio, the overall debt to gdp ratio is the highest than anywhere in the world and that has been sustained for a long period of time, and that is similar for south korea. The Household Debt levels are high, but it is seasoned debt. It has been there for a while and so, there is sustainability there. In all cases in the high risk category, the sector where you have those red flags is where you should expect weaker growth , rather than a crisis where you have a trigger. Shery david, thank you for all of that, but stick around because they want to get you in our Group Discussion in a few minutes. Coming up, with earnings season swing, we look at the latest beneficiary of the commodities come back. Details, next. This is bloomberg. Shery this is Bloomberg Markets asia. Im shery ahn. A quick check of the latest business flash headlines. China might ease Foreign Ownership limits on life insurers, potentially removing a drag of local companies. The company could raise a longstanding 50 ceiling on an overseasened stake in their joint venture. Companies have only 6 market share more than 15 years after china joined the wpo. And the latest but on the demise of the internal Combustion Engine, shall and toyota are Building Seven new fueling stations for Hydrogen Cars in california. The state is trying to address the lack of feelinueling in hydrogen. They plan to use hydrogen to save on the additional engine models by 2050. Russia overtook saudi arabia as the worlds biggest crude producer in december. Both country started restricting output ahead of the greek curbs. Of agreed curbs. Russia pumped on most 10 Million Barrels a day that month, about 30,000 more than saudi arabia. It was the First Time Since march that the russian country produced more oil. Biga says the countrys three airlines have room to gain. The brokerage says air china, china eastern and China Southern should get a bump in passengers and revenue as the economic recovery gathers pace. They are the biggest gainers this year in the asianpacific headlines. Caltechs aren rebounding from yesterdays asses, up 1. 2 after posting increase four year profits. Paul allen has been tracking this in sydney. Beneficiary of rebounding energy prices. How are the numbers . Paul the numbers were very good, 610 million australian dollars for the full year, up 17 , that is about 470 million u. S. Measuresltexs favored is the replacement cost. A revenue was down a little bit, but there is still the final dividend of 52 cents. Shares are performing pretty well, up around 1 , though that came off earlier highs. A different story for oil search, though. Oil search has returned to profit aftertax basis, 89 million there reverses the laws from one year ago. But underlying profit was about 70 . We had the ceo of oil search in the studio a little bit ago. Peter botten said the oil price could be stable because of encouragment from opec. At the end of the day, the supplydemand balance is tightening and the industries are dropping and i dont see much happening to the oil price in 2017. I think if disciplines continue the slow rise, it could be possible in 2018 and 2019. Shery and of course, the big one today after the close, bhp billiton reporting numbers. What are we expecting . We are expecting a sevenfold increase in firsthalf profits, great things expected from bhp as those Commodity Prices rebound, particularly coal and iron ore. The latest guidance we have is 2. 94 billion for bhp and possibly a dividend of 28 cents. Shery thank you. We are looking forward to the afternoon business in tokyo. Equity markets across asia, gaining ground. This is bloomberg. Is 11 29 a. M. In hong kong, 12 29 p. M. In tokyo. Toshiba could begin the steps of putting it crown jewel chip the business up for sale as early as friday. Sources say the company is considering a plan to raise 8. 8 billion dollars. Conditions include maintaining employment as well as domestic reduction and development. The report says microsoft is interested in submitting a bid. The u. S. Vice president pledges a strong commitment to the eu on his european tour. Mike pence said the Trump Administration would seek ways to bolster relations. Trump had earlier questioned the eus by ability and called nato obsolete. Madam albright told bloomberg that mike pence had helped to reassure americas allies. Defense secretary james mattis says the u. S. Is not in iraq to seize the oil and despite trump threats to do so. He met under the shadow of the president s oil comments and the failed travel ban, which included iraqi citizens. He said u. S. Forces would be there for some time fighting socalled Islamic State alongside iraqs army. Resilience of this Army Recognizes it took casualties. It has reconstituted itself, both equipment and personnel wise, and as you know it has crossed the line of departure going against the enemy in west mosul. This was not something that was a foregone conclusion for an army people were questioning. Hasnternet entrepreneur claimed victory after a High Court Rules he was not guilty of copyright infringement. However, the court found him eligible for removal to the u. S. On grounds of conspiracy to defraud. The u. S. Is seeking to extradite him over his defunct filesharing platform. He says he will appeal the. Uling global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Thank you. Asian currencies losing ground as the dollar index gains above 101, the yen trading at 113 point 67, down. 5 . Lets get a check of how this is playing into the equity markets, especially as japan reopens for the afternoon. Here is sophie kamaruddin. A weakere are seeing yen and boj buying etfs, supporting the nikkei 22 higher, up. 7 . Yokohama rubber gaining almost 5 , rising after posting annual profit. Softbank the biggest drag. ,hile the telco segment falling some financials helping to support shares in tokyo. Higher,g marginally theyll international poised for the biggest gain since july after Credit Suisse upgraded the stock, advancing the most in asia. Art leadingg suna the drop in the region after being cut to neutral by jp morgan. It helps to navigate sluggish sales at its brick and mortar shops. I want to focus on some equity movers, a report from goldman chinese china say Airlines Stocks have room to fly despite trading at their most expensive level since 2015. They expect the big three carriers to experience a bump up in passengers and revenue as the chinese economy recovers. Upgrading air china and China Southern sorry, air china and southern eastern. Saying China Southern has the biggest gain. They have advanced the most in an Airlines Index this year. The chinese carriers have been helped by a stronger yuan and studying oil prices. Shery thank you. The australian Prime Minister has told bloomberg he will maintain a Good Relationship with the u. S. Despite reported rift with President Trump. Lun, malcolmaidi turnbull spoke against protectionism and says that at his home his government is committed to investing in new infrastructure. Great interview. I love the part when you actually asked him, what do you think of donald trump the man . Lets start with those geopolitical matters and what he had to say about donald trump. Haidi yeah, that was always going to be the focus, wasnt it . The spotlight was always going to be on that relationship between these two allies, australia and the u. S. Come a specifically the relationship with the new president. I asked him whether he has two changed the way he deals with the white house given the new president has a bold, new style, and he said he had several conversations with President Trump by now. Constructive, frank, and forthright and continues to pursue australias National Interest when speaking to trump. Of goodused the analogy friends, that these conversations are not for the public to know in terms of the details, but here is what he did have to say about President Trump. Australia alliance, relationship, is very deep. It is built over a century of fighting sidebyside in every major conflict. It is an alliance. It is an economic partnership, and is built on people to people links and family links, so it is strong and the. Haidi as a man though . He is a Big Personality and has a very big job. I asked him about the implications of free trade given the trump policy platform of america first, the brexit vote, and the rise of populism, because it is also taking hold in australia. The Prime Minister spoke strongly about the need for open markets, free trade, and how much australias Economic Future relies on it to take a listen. Vital that we maintain that drive towards more open markets and free trade. Trade means of jobs. Australia is a trading nation. Our future depends on not simply selling things to 24 million australians, sell them to the whole world. As i said at the g20 last year, protectionism is not a latter to get you out of the low growth trap. It is a shovel to dig it much deeper. Haidi Big Personality, that is so diplomatic. No one will refuse that about donald trump, but lets focus on the australian economy, so what else did the Prime Minister have to say . What is happening in the economy there . Big defenderthat of free trade, and we spoke about his dealings and policies, but i asked him whether this rise in populism globally and in australia has meant a more hostile environment for investors. He was at pains to point out that australia is open for business, one of the most open economies and the world when it comes to foreign investment. We also spoke about the perceived reluctance for the government to spend on infrastructure. Rating,tion on that aaa focused on cutting the deficit. The president did say the imf has a point when calling on australia to borrow more and invest in infrastructure to spark activity and job creation. Prime minister turnbull says australia is committed to investing in infrastructure, and the imfs right to point it out as a major driver of growth, it did say his government remains focused on bringing the budget balance, a major concern since s p cut that aaa rating to negative after last years election. Joining us. You for great interview, by the way, haidi lun from sydney. Lets head over to singapore. A set of measures have been outlined to help the struggling economy and support the energy and construction industries. Lets get the details from our Southeast Asia and correspondent haslinda amin. What does the government have in store to spur growth . Haslinda well, it has plenty. Theact, you can some of budget in one word, comprehensive. It attended to cover all the critical areas concerning the a rising agent population come across sectors, and cover every aspect of singapores economy. The retirement range has been raised to 67. It is also helping Small Businesses to adopt technology, innovate, go global. Revenue andng taxes, just some of the measures announced yesterday. The lion city is trying to position itself for the next phase of growth, the next 10 years, amid a rising backlash from an antiglobalization sentiment and weaker consumer demand. There is concern because singapore is susceptible to changes in the Global Economy, highly dependent on trade, and we heard Malcolm Turnbull say trade means jobs. Here is what the finance minister had to say about never getting the challenges. And countries everywhere facing headwinds to growth. There are uncertainties ahead. These are not shortterm, medium to longer term uncertainties, and technology is disrupting jobs everywhere, and this will continue for much longer. Haslinda longterm uncertainty. Shery right, and i know you also ask the minister a key question on the Property Markets. Of course, this is a hot topic in singapore. What did he say about those curves in place on the sector . If you areell, hoping for the property curbs to be removed, you will have to wait a while yet. The minister said it will take some time because demand has been resilient despite efforts to cool the sector. That the curbs have also helped the property sector to have a soft landing, so dont hold your breath because they will stay for some time. Shery thank you so much. Haslinda amin joining us from singapore with the latest on everything from the budget to the Property Market there. Tata gets a new chairman since the ouster of cyrus mistry. What are the major challenges facing the new chairman . Interesting. One of the most successful Corporate Executive takes over the Group Starting today. Facing him as he enters. Firstly, he will have to reestablish the relationship sons has with tata trust. Remember, that relationship broke down with cyrus mistry. Secondly, managing perception. Engineered a coup to house cyrus mistry. Reputation coming after a successful track record. It would do well for him to be seen as his own man with a successful track record and strategy. Thirdly, the tata group would do well without drama and getting growth back on track and white in some of those week business units. Exactly. We have those underperforming assets here this is a huge conglomerate, steel, motors, hotels, so tell us some of the challenges that some of these units are currently facing. , let me will throw one number nearly 90 of the profits of the group come from two companies, consultancy services, and jaguar land rover. The first task would be to hedge some of his bets and ensure growth comes from a Diverse Group of businesses. Secondly, some of these company Like Indian Hotels was an acquisition gone wrong. It is not a former player in the telecoms space. A has to pay compensation of billion dollars. Power or tata steel, tata steel made one of its cut most costly acquisitions. It has yet to recover from that. It is struggling to deliver up to its potential. Linen wasis dirty washed in public by cyrus mistry when he called the business of legacy hotspot in a letter. So they would do well to clear some of these legacy issues and bring the focus back on the future and talk about what he into do about investment new growth areas. His background in Technology Works well, but for now his plate is full. Shery thank you so much. Joining us from mumbai with the latest on tata group. One feature on the bloomberg we to yourke to bring attention is our interactive tv function, tv. You can watch us live, see previous interviews, and dive into functions we talk about. You can send us instant messages during our show. That is for bloomberg subscribers. Check it out at tv. Speak withng up, we Standard Chartereds david mann and ask him why he believes brexit to be just the beginning of europes challenges. This is bloomberg. Shery welcome back. Joining me now are in and ryan curtis from Bloomberg Radio and david mann, chief asian economist at Standard Chartered. I love this combo. It is new. Lets talk about we have not touched upon the fed or europe. Should we start in europe . Could be axit, factor, a trigger for downside in Global Markets according to your notes. You could see some of that, and the risk factors, a hard brexit or not, and what it can mean for other countries leaving if it turns out to be the case as it is the case right now. Arent you underestimating the risk to asia . The greek talks going on as well . What we have been seeing from talking to clients is no one wants to bring up europe. They are not focusing on it. The problem is it is i narrate, either badly wrong and everyone cares, or they leave it on the back burner. I think that currently is the way people are looking at it, even with the laundry list of things that could go wrong. Not can think about too many of these contingency plans. Do even look at the polls this time around . There are doubts on that. For example, the french election, such an enormous swing towards le pen assuming she gets into the second round to create that shock factor that as you get into the runup, like the brexit vote, you may see a rally in the euro, even knowing those risks are there. This time around, we think the market may be right. Earlier, we talked about the risks this year, china, and you said some of the risks were for upside surprises in china. We ran out of time to flesh this out. You said that even with the pboc tightening, we had a few guests the pboccent date that was lose last year and will tighten this year. Beene export data that has positively surprising will keep positively surprising, and not just china, but the region. Not coming from particularly strong growth. It is really from a recovery in prices of exported goods, coming alongside higher inflation and export prices, playing a bigger role than most people think. In chinas case, the other positive is that support for growth wont be coming from monetary policy. It will be fiscal policy support. It is just enough they would do to keep growth where it is. It will not eat something where there is a sudden boom coming. You also said there is some surprise to the upside with some market economies like the philippines and thailand. Some of those surprises could come from a good example is the philippines. The main coverage is the fight against crime and the story there. The underlying growth momentum and determination to deliver on wellthoughtout plans is quite strong. You may end up seeing, china and if you get the philippines, now that the political relationship is warmer, that is where some surprises could come from. It is a similar story and thailand, delivering after all those years of disappointing. Is there the risk that the asia story may be derailed with trade tensions between the u. S. And china . You have to factor in, think it through. I would be surprised if there are major decisions being made that are part of the Global Supply chain. There will more likely wait until we get clarity from the Trump Administration come up it so far, i think people are hoping for the best. Currency labeling, the manipulation views, the same sentiment as well . Right. s it is wait and see. You just dont quite know. I think people are assuming that it wont go down the worst of possible paths. Does it matter . Theyre trying to prop up the yen. With a have any base . China might have more of a case than china. The weakening of the currency compared to other currencies and the fact that it has been many years since china has been stopping the currency from appreciating, so it is more a case of the Administration Working out exactly what it is they want to target first, and that is probably why we had this delay in what otherwise was meant to be labeled manipulator day one. David, thank you for joining us. David man from Standard Chartered, along with the bloomberg gang. Coming up, the big issues facing the travel industry as the aviation festival gets underway in singapore. We will be live there in a moment. This is bloomberg. Shery you are watching Bloomberg Markets asia. Im shery ahn. Oil prices and uncertainty over President Trump foreign policies may dominate the two day aviation festival and asia taking off in singapore. This going on globally. Will it have an impact on the Aviation Industry in asia . Certainly. When you look at what is happening, we have various carriers instituting fuel surcharges. It is not an outward concern right now. It is a positive because if people are able to lift the price of tickets, well, it shows there is demand, if you will, and they have the ability to give you an idea of how big asia is becoming in the world of aviation, 4000 aircraft on order these are hugeso backlogs lasting for five years of aircraft due to be delivered here it china is a key player. Everybody wants a piece of the action there. 20 millionnes, passengers inbound at the moment every year from china and they are hoping that in three years time in 2020, it will be 40 million, the year we have the olympic games. Add to that the profusion of lowcost carriers, line air, air many ofdia express, so them, spice jet, we talked to them tomorrow. So that is what we have at the moment. It is a lot of optimism here, very little commentary about donald trump, because people dont action know what will happen yet, that immigration ban has been rescinded, and we are waiting to hear what comes next, so lots of things being discussed here. Shery you mentioned all of those airlines coming yes, there are so many i cant keep track of their names, so will we see some industry consolidation then . Thingd well, thats the you see. It is a problem because we have seen consolidation in the u. S. , four major carriers there. Europe is ripe for consolidation, but because of bilateral treaties, of course a lack of open skies agreement there has been little of consolidation people have been clamoring for here as well, so people have been coalescing around these various airline alliances. Just a programming note, talking about the impact of lowcost carriers and more, the ceo of India Express and about 40 minutes or thereabouts. Will be looking forward to that interview very soon. That is it for this edition of Bloomberg Markets asia. Blo yousef we are Just Moments Away from the and results. Will investors be rewarded with more buybacks . Pressure overtakes saudi arabia as the worlds biggest crude producer as output restrictions kick in. More money into unprofitable air berlin after creditors snub a deal. Shery Michael Turnbull on trump and an exclusive