Over. Welcome to daybreak asia, coming to you live from our asia headquarters in hong kong. Mann. Vonne positive earnings pushing the stocks to a fresh record. Action in new york. Much run byry optimism over the current earnings season. Check out the closing numbers. The s p 500 on a record, the sixth time in three days. Records. Posting and providing a big post big biz, markets resilient and after bad earnings, good earnings making the market rally. It is better than expected. Microsoft up 5 . Strong earnings for them. And Morgan Stanley coming with better than expected bond trading revenues. That lifted the banks. And technology, price cutting will be a priority from marvell. And chipmakers at their best performance in teen years. 16 years. David yvonne and even after the bell su they got it at the high end of the midpoint. They did also come in with Slower Growth in the chip division. There is concern that intel will not be able to wait make up for the weaknesses on the revenue side. Shares down after hours and it could translate into the thursday session. Qualcomm has a big win all around. Shares up 8 in extended trading. They got a boost on the china orders and royalties. Third quarter adjusted profits be the highest beat the highest estimates out there. This definitely put them over. Yvonne how about the economy boosting stocks . Su there is a correlation between the better than it acted Economic Data better than expected Economic Data of late and so far, looking decent in terms of companies that have reported so far, 78 beating estimates, and beating those projections. It is still early in the season and the outlook that the companies would be reporting profit losses, about 6 . So far so good and the market coming to life. Yvonne good surprises. Thank you. We will see how this plays into the markets in the asia open today. We go to david for that. David equities going up, asia gaining at the open. And you are talking about the earnings. In asia, very much of course the tail end of wall street. And this is the case today, beating the expectations of the central bank. Continuing to ease at least, really driving the price higher and higher, regardless of the Political Risk out there. That means this is an accurate assessment talking about australia, especially new zealand appeared i will talk about currency in a moment. You are talking about 92 probability that they will cut rates. It is august 11, that will be the day of the meeting. That is having currency lower. Decisionith a rate today. They will be cutting 25 basis points. Unsurprising, new zealand with a record high, not looking back. Australia, aleppo month 11 month high and futures indicating at 1 in south korea. And it is up. Quickly, to the currencies. I mentioned the kiwi dollar, 10717 are now. 69 u. S. Cents. In, these expectations they said some things early this morning. Yvonne the u. S. Justice department looking to seize more than 1 billion in assets they say working legally acquired from they say that were illegally acquired. South asiar correspondent. What is the latest . The fbi said malaysian people were on an anonymous scale. Enormous scale. There have been civil lawsuits. Fund wasthat the onemd used by luxury estates. Take a look at what Loretta Lynch had to say. Tragically, aly, number of corrupt officials treated this public trust as a personal bank account. Billions of dollars misappropriated, much of it laundered through the u. S. System. And the malaysian government has acknowledged the civil lawsuits, they say they will cooperate. Yvonne you talk about these corrupt officials and the inner circle, with anybody named in the complaint . Twooogle mentioned, people were mentioned. One of them owns a hollywood madection company, which the willful wall street. They came out with a statement that said that the funding was not a legitimate, that they did nothing wrong and that the lawsuit will not impact them. And the other person named is financier, the Opposition Leader from malaysia. He came up with a statement, saying that they must come clean on 1mdb. A lot of reaction. Yvonne and what about the swiss banks . They are getting help . To what extent are the swiss banks involved . We know that a swiss bank was involved. U. S. Prosecutors have highlighted other swiss banks they believe are linked to the one mdb scandal. Bank. Them includes they are seeking help from u. S. Counterparts to gather information. One of them is under investigation across the world, the money trail traced to singapore, switzerland and the u. S. The caribbean as well. This scandal has been going on for more than a year and it is still unfolding. Yvonne thank you. We have breaking news. A lot to talk about. Open, rising at the because of the pokemon go affect. Nintendo up 6. 3 . And after we saw the shares fall yesterday, those are back up. We are looking at them and how they are doing. This is after they delayed the launch of pokemon go yesterday in japan, so that made investors not happy. But we are looking at nintendo back on their stride, up 3 this morning. First word news. Investors may have had enough of their in china. They are pushing management to sign an agreement with the market leaders. And discussing a potential deal that executives would need to end need to negotiate. They fight for dominance in china. And the british Prime Minister traveling to paris after talking brexit with the german chancellor. Angela merkel was ruling out talks before britain theresa may says it will not happen until next year. I want to work with the chancellor and colleagues in a constructive spirit to make this a sensible and orderly departure. All of us need time to prepare for negotiations and the u. K. Will not invoke article 50 until the objectives are clear and that is why i said this will not happen until the end of the year. Turkey will impose a threemonth state of emergency as the government looks at those responsible for the failed military coup. The president talks about the uprising. He said that the threat was not over. The bbc says 9000 people have been arrested and another 50,000 have lost jobs. Day innews, 24 hours a more than 120 countries. This is a bloomberg. Yvonne the lira is at an alltime low. Tapping fast talking about this talking about this on the bloomberg. More weakness ahead. Three times in the last 12 months, the lira has been treated against the dollar. And we have inverted the y axis. David green is the spot, orange is the implied price. Noting, things worth first is when you look at the spread and where the implied price is, that is the widest in seven weeks. It goes on the way back to september of last year. And you can go all the way back 12 years. That being said, then i percent decline the 9 decline is suggested. Keep that in mind. Let me show you with the forecasters are saying. This is the market and this is what the forecasters are saying on the bloomberg. There is the spot. 308, 390 with a have not been revised. Last time it was revised, 23 days ago before the latest developments. Watch out for the revision. Yvonne ok, thank you. Breaking news, oil surge. They will not submit revised offers for interoil. This is after we heard from exxon oil this week, making a bid for the and edgy inner oil, that actually talked bids topped bids. They said that those from about the counter. They will not submit a revised bid. Overnight, we heard from to tout in a statement that they were looking at the competing offer, so we will see if they actually come out with another bid. Coming up, the worst performing currency could fall 7 more this year. Here the reasoning behind that. Yvonne a check of the latest headlines, australias secondbiggest oil producer posting a drop in revenue. Despite output moving up, secondquarter sales lead to 825 million of a decline. Laster, the Company Reported the worst results in 13 years when the profit fell 99 . Stocks falling 21 in the past year. Shares of about. 5 . And is active granted bail after being arrested at jfk airport after an investigation into trading at global banks. Ofk johnson, the global head Foreign Exchange in london committee. On wednesday and surrendered his passport. Ofnd a colleague are accused using inside information to make 8 million for the bank. Rmpoffering to buy out as for 880 million. The proposal from the real operator is at nearly 2 billion. They currently own parts of and are seeking to take the Company Private after service disruptions. As an rt is expected to become owned by my second in november. And one provisional approval for new schedules to tokyo. Delta, united and hawaiian will be allowed by u. S. Regulators to take daytime flights to narita airport instead of the overnight journeys. Delta was the only carrier to get approval to add a new route and will begin new flights from minneapolis. And our next guest more cautious in his portfolio and it says that preservation is a number one priority. We will welcome luke. Great to have you. You had a little bit of caution going into the rallys across the board. What could derail this . Guest we saw brexit coming on, which was unexpected. 6040 remain and it came out to be a 5050, so that did work up the markets. Now they are working to recover. Going forward, the risk is clear. There will be a u. S. President ial election and the fed and what will happen to china. Yvonne so from brexit, it seems to be contained. And with the election, back in focus, could we have a fed reversal . Guest we are baking into the a 12 hike for the year. It seems unlikely after the election, but it could move. That is what is being suggested. 12 , probably 1 is more likely after the election. Yvonne so will the dollar continued to rise . Guest we have a biased toward the dollar this year. Certainly over the last three months, the move against chinese currency as been more impactful for us and we have been looking at the 5 devaluation. Range you7 is the are looking at. So we have seen some silence as we go into the g20, many investors complacent about where the yuan is going and how there is more transparency coming, do you see it that way . Been ane has big effort to be more transparent, but with the g20, they were looking at the currency slide. It is done exactly the opposite. Going forward, we are Firm Believers that currency will be used as part of the toolkit. It could weaken further. Other things have also happened come a lot of credit has been created in china. And we do not expect the same amount for the second half of the year. These are all contributing to the story. Yvonne so far, they have kept things stable, so if they continue the trend of 5 7 lower, they can maintain a lid on it . Guest what has destabilized expectations, the big moves, the unexpected moves. What has been going on has been for the last three months, sustained stable moves and the direction is clear. Yvonne lets talk about strategy. One thing we have been watching, whether we will have a bull market after the index from yesterday. I will look at the chart right here. Thecan see the index for subscribers, the premium right now as the narrowest sense october since october. So they are cheap, not as much as before. Guest i will put my hat in the ring. Reasonably cautious, we are looking at equities and the hong kong story, the equity market not too hard. If you look at the in hong kong, tied to the u. S. , and when you look at earnings of the companys they are very high. So you can see why the given how well the s p 500 is doing, it is expected that a hong kong shares will do the same. Yvonne what about the bond market, you are looking at the levels of the g4, are they getting bubblelike . Guest it is interesting. Very difficult to dispute that a large chunk of the gains are behind us. It suggests that we are moving into territory that will be very hard for investors to justify. What people have to do in the bond market is look to add premium, try to find those spread products, so you can outperform the bond markets. Yvonne where do you look . Guest you do not look at the japanese market, no value for the german market, so you will find value in the u k, much more in the u. S. Market and in the australian market. But boldly, other markets offering more value for any kind of metric you want with a credit rating. But you need to take on more volatility. Yvonne ok, luke. That is all the time we have. We appreciate your input. Msing up, the search for the scientists asking, have we been looking in the right place . Examining conflicting theories, next. This is bloomberg. Yvonne officials from malaysia, china and australia will meet to assess the ongoing search for Malaysia Airlines flight 370. 90 of the official search area has been covered in the indian ocean and there is no trace of the flight that disappeared in march, 2014. We have been following this out of sydney. So it begs the question, i we looking in the right place are we looking in the right place . The big question. The closer we get to the end of the official search area, people are concluding that we are looking in the right in the wrong place. Even australian officials agree that the search has been so thorough and there is a high level of quality, that is the jet was there they would have found it. And as you say, they whittled down the enormous expanse in the indian ocean to a little patch really the sides of the u. S. State size of the u. S. State of delaware. And that is less than 10 of the search area. So the question now asked as to where the jet is. Yvonne it seems like it has been an endless search for more than two years. So where else could we be looking . Scientists, even those involved in the official search who have tried to recreate the flight path are now wondering whether that search area was big enough and really looking at one of the main assumptions of the search, that was that the jet was out of control. Nobody at the controls when it ran out of fuel. What happened with nobody at the controls is that it takes a left turn and the spirals increasingly sharp evenly sharply into the ocean, not traveling many not all miles. Not many miles. If you change the assumption and assume that somebody was at the controls, you can then glide it for more than 200 kilometers without fuel. It would take it way be on the limits of the current search area. Make analso does is unthinkable size of area for searching. Yvonne really quickly, what are the chances of the search being moved or expanded now . Guest so far, 30s have been firm that they will not look so far, authorities have been firm that they will not look anywhere else. It is in their best interest to solve the mystery, to prevent more accidents of this sort from happening. We will find out tomorrow. Yvonne we will be watching out for that meeting. Still ahead, teslas big reveal. Details of the grand master plan, coming up. Elon musk has been tweeting about it all morning. This is bloomberg. [hip hop beat] olympics 2016, let me get you on my level. So you never miss a moment, miss a minute, miss a medal. Why settle when you can have it all . Soccer to wrestling. Track and field to basketball. Fencing to cycling. Diving to balance beam. All you have to sa is, show me, and boom its on the screen from the bottom of the mat, to the couch where you at . Show me the latest medal count xfinitys where its at. Welcome to it all. Comcast nbcuniversal is proud to bring you coverage of the rio olympic games. Yvonne we are half an hour away from the opening of trading in singapore. It is a beautiful morning. You are watching daybreak asia. Yvonne now we will get to the first word news. Asia keeping the global rally rally elrod alive, this is after the s p 500 and dow jones closed at record highs. Strong earnings putting the wind back in the sales. Adding half a trillion Million Dollars over the past three weeks. Turkey will impose a threemonth state of emergency as the governments it government looks at those responsible for the failed military coup. And the president blaming the says theon and threat was not over. 9000 people have been arrested and another 50,000 people have lost jobs. The u. S. Justice department looking to save 1 billion in froms they say was stolen 1mdb and laundered through american banks. They say it was used on real estate and even bankrolled the film, the wolf of wall street. Americans say they will cooperate with the investigation. Is bloomberg. Yvonne thank you. We are 30 minutes into the trade in japan, south korea and australia right now. David has the latest. David asia extending what we have seen over the last three weeks, gains overnight in europe, and we have record highs from the dow and s p 500. Heavyweights weighing on south korea. And they are getting warmed up. Very quickly, looking at the gains, and keep in mind we are looking at eight Global Markets in the asiapacific. And chances are at some point today we will have hong kong joining the club, so less than 1 away from them opening going into the bull market, making it nine. So we will talk about pokemon go, one not . Why not . Sincestingly, indonesia yesterday has been cracking down on the game. The latest one, this is out of jakarta this morning, the president ial palace in indonesia has imposed a ban on staff and visitors playing the game inside the president ial palace. Involves playing the game or searching for pokemon. They will be prohibited within the palace. That is according to the jakarta post. The stocks, we will talk about them in a bit. Nintendo up 4 after a drop yesterday. Mitsubishi raising price targets to a street high of 40,300. Another 11,000 right now. And what is interesting to my mitsubishi has boosted the price because they have switched , so verys methods interesting to see that changing. When you look at a company like nintendo and they say the best Case Scenario for this is that they raise their stakes in the codeveloper of the game. Sayingd case, they are no change, but there will be a positive impact on the business. And mcdonalds over the last 48 hours, saying they will be collaborating with a few months of as a partner with pokemon go as a partner. You could actually see that in japan where you can play the game. And for the latest on the game, this is not a joke. You can go on bloomberg and the everything on the game and the stocks. Gainer, down to the earnings. It is really buying on the back of the earnings not being so bad. Those are up 2 . Yvonne thank you. The bank of new zealand showing that more cuts are in store. They released an unscheduled update on the economy this morning. Going to sydney. Paul on the new zealand really getting hit. What are they saying now . They have been explicit this morning, it seems likely that further easing will be required, so not much room for doubt there. And inflation is the key reason. They would like to see inflation back within the target, or near it. That is about 3 currently and inflation right now below 1 . And 2. 25 the next opportunity to revise it will be on august 11 and all bets are is that is when they will move. Yvonne inflation below 1 for seven straight quarters. They are looking at stoking the red hot property market, so what has the government then about that done about that . He talked about it this week when they introduced new rules on how you can borrow from the investors, those investors needing a 40 deposit. The ceo of a company in new zealand writing a column, saying 60 could have been better and they are issuing a warning about the market in new zealand that is out of control. June prices rising. These are not quality houses. Yvonne ok, land of the currency going out of control. The kiwi dollar already slipping this morning, so the governor already achieving one of those goals then . Yes, and the statement he said was the decline in the Exchange Rate was needed. It is off almost 1 this morning. It is up strongly so far in the past year. Nearly 11 , but it has pulled back in the last few days. He said that behind the new zealand dollar, they are holding down inflation. Yvonne ok. Paul in sydney. Republican Vice President ial nominee mike pence will take the stage later today, trying to unite the party. The indiana governor was chosen by donald trump for his conservative credentials. We will go to saw shot eisenberg who is joining us Sasha Eisenberg from cleveland who is joining us. One thing we have not heard this week is an established politician making the case for a donald trump presidency. We heard from his kids, some people outside of the conventional political sphere, so the job incenses to not intenses do not talk about hillary clinton, but to explain why donald cap is ready to be president and why he would be a champion of conservative values given his mixed record ideology. Yvonne and the statement on the speechwriter who is accused of plagiarism. What did they have to say . We got a letter released today on the donald trump letterhead, from a woman that was not part of the public conversation about the campaign. She identified herself as a junior writer who had taken responsibility for writing speechng melanias and what she described as an act of transcription, writing on passages that melania had selected from Michelle Obamas speech and things she liked. To explain how they got there, she had to say that Michelle Obama was somebody that melania respects as a first lady, which is at odds with the disdain meant that the republics republicans throw around for the obama family. Yvonne interesting. You are at the convention, and it has been peaceful, but we did see protests today, right . What do we know about that . I think that the final count was 17 people arrested outside the permit or perimeter. They have been self identified as revolutionists. All told, this has been more peaceful than anybody expected. Yvonne ok, continuing to watch developments out of cleveland. Thank you, sasha. And looking at bloomberg highfliers, somebody who owns more than 100 restaurants, were talking about Wolfgang Puck who has served celebrities, u. S. President s and even the queen of england. But there is one person he really wants to cook for. I think that the pope is a simple person, so i would not make something with caviar, maybe something that my mother or mother grandmother made for me as a child. Make this ravioli with potatoes and cheese and maybe some minutes and mint and serve it with butter. I think that he would like it. Yvonne catch more of Wolfgang Puck in our series, highfliers. Conglomerateian that says they may list one of their units. We have details on their new chairman, next. Yvonne quick check of the headlinesyvonne . Shares falling after a german carrier cut profits for the year. They are expecting weaker demand for european travel after the reason terror attacks. The carrier says that revenue could fall by 8 9 in the second half. India isell us that clearing the way for apple to open a retail store. After delays, the government is likely to approve a threeyear exemption on the rules that have kept apple out of the market. Foreign Companies Must by 30 of components locally, but india will make an exception for the cutting edge technology. And volkswagen shares writing the most in three months, exceeding expectations. Billion,et was a . 25 but it does not include 2. 4 billion from the pending lawsuits in the u. S. They say that there will be an increase as they try to recover from the omissions scandal emissions scandal. And stepping on the gas as crude output launched in the first half. So how is the worlds biggest refiner . They have been in the cross hairs this year, crude slumping down 30 from a year ago, said that really hit for the first half. And it is changing how the company and the oil giants in china are changing between natural gas and also traditional crude. As you can see, this tells a story. This is a statement to the stock exchange, the crude output falling 11. 4 , 154. 2 million barrels. Natural gas on the flipside, 388. 7 billion cubic feet. So the Oil Production dropping and natural gas picking up, a sign of the times. This is for the output in china, looking at high cost and low prices that have hammered the oil giant. Beijing, theion in major refiner having a hard time passing on the cost to the consumer because of the gas in china. Will shut down some oil fields this year as those crude prices go to their lowest since 2003. This is their chart, down to express that. I wanted to flip the page. You can go to the crude prices, the charts are almost identical. Ok. Yvonne there you go. Pretty much the same. Taking a look, you say this is the sign of the times. How low those oil prices were is this a long Time Strategy and the focus on natural gas . Not,ether it will work or getting away from the reliance on imported oil as well, they imported a Record Number of oil, even though the Domestic Production was down they are still importing at record levels. They want to really move away from burning fuels, get away from coal as well. They plan to double the annual gas prices by 2020 and ill and also the largest big state changedid last week, i my voice, they said that natural Gas Exploration production should improve in the second half of the year. Yvonne thank you. Billionaire adi godrej says they want to grow the Family Business , and they are still on track despite Indias Economic slowdown. He spoke in mumbai. We began by asking him how he plans to continue the rapid growth rate. Itwe partly achieved organically by normal growth,. Artly by in organic now i expect the economy will do well. We are expecting good monsoons. We had two bad monsoons which affected growth rates last year. We hope that the reform called gst will work through. So i expect strong growth in india and i think that our growth targets will get achieved. Stepping outside of india, there is a three by three strategy where you will focus on africa, asia and latin america with home products. Why those product areas and those markets . Those are areas where we have strengths, we have a product that we have developed, very good products. And in addition, Consumer Products in india are low, and and other developing countries they are low, so this is an opportunity. We are doing well in india in the product fails fields, and we think we can do well and other developing countries. Over the last 10 years, we have helped to build a strong business together. And within the group of companies, any ipo possibilities . We have no immediate plans for an ipo, but there might be an ipo over some time in the agriculture. It is growing rapidly. We might look at taking it public. Any acquisition targets . Acquisitionecific targets, but we are keen to grow in organics. Both in consumerproducts and Godrej Agrovet ltd. Yvonne that was adi godrej. Next, emerging from an accounting scandal. The ceo has bigger ambitions. That will be next. This is bloomberg. Yvonne asian stocks rise to a threemonth high after positive earnings in the u. S. And doing well on wall street, reaching the records overnight. Shares up 1. 3 . It is all on stimulus thats bets. And going to sydney, we expect a rate cut in august, but shares are up 1 10 of a percent. And looking flat the last time we checked. Seeing it unchanged in 2015. And in 15 minutes, the futures pointing to a higher open today. Since aeen five years scandal about accounting methods, and then stock has recovered and profit has surged to a record. The ceo is not done. We will bring in brian, he has more from tokyo. What can we expect . We had a very interesting interview with the ceo and he made it clear on two things, he really wants to put the scandal behind the company, get them firmly out of the penalty box. He is really talking about Growth Strategy again. He talked in great detail about mna aspirations that he has. So the companys profits are back. They have not put all problems behind them, they had a setback in march in which they settled a probe by the department of justice, related to kickbacks to the doctors in the medical device business. And there are lawsuits involved with their scopes that they are trying to work through, but compared to five years ago this is a company on better footing. Yvonne you mentioned better footing, but for the past five years they have been dealing with a credibility problem. Has it regained Investor Trust . I think, to his credit he has taken steps. He has brought in outside directors. There is a greater mindfulness that scandals have a real world impact in terms of profits and stock performance. The stock is underperforming a little bit this year, it has been a tough year for the japanese stocks over all. But if you look at the sentiment toward the company, they are getting upgrades and people are bullish about the medical device business. Yvonne what is the outlook on the core medical device business . Ympus makes ol devices that allow you to take pictures and do early diagnostic work on patients. It is a trend that is hot right now because the cost of health care is being scrutinized. So those companies that have diagnostic equipment that is wellregarded and can also do minimally invasive procedures, they can do pretty well in this environment. And that is pretty much what they have in their portfolio. The ceo set Ambitious Goals for revenue for the company, talking about 30 increase by 2021. The lions share well come from the medical device business. It is all going into that. Is the mna activity he talking about, although he did not drill into specifics, that will be orientated around the medical device business. Yvonne you mentioned that he mentioned no specific companies, but is in there anywhere else he is looking . Raise the possibility of a brandnew move outside of the core business. They had the camera business, the medical devices, industrial macro scopes, where they might go after that he did not really indicate. One of the big trends in medical devices is becoming more robotic, there are robotic Companies Moving in and many people think it is a possibility. Although, he did not indicate that in our interview with him. Outmna activity will build the medical device portfolio in some way. Yvonne ok, brian. Thank you very much. That is it for us. What is coming up next . We are taking a look at what has been going on with oil. We will explain why they have called out called off an over in oilake company, exxon double down on that. We will about that. And from idc, talking about intel, and the internet of things. This ingestion that we should suggestion that which is stop chasing pokemon for a minute and looking at what is happening in asia and what is hot and what is not and what will be next on the horizon. And also looking at the protests in china against kfc. . C sv it is thursday the 21st of july. I am rishaad salamat. This is bloomberg. This is trending business. We will be visiting singapore and sydney this hour. Stocks up to a fresh 2016 high. Investors feeling positive about the economy. The u. S. Justice department moves on an
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