Spotlight later. The japan and korea spat rambling on. They may be forced to retaliate. The latest plan fails to impress. Started withget us a quick check of the markets. Health care tech are some of the biggest decliners. Individual movers like apple being downgraded. Falling after they cut their outlook. We have lingering effects from the data that we saw last week. Had one sector that gained ground, the energy sector. Also rising with geopolitical tensions. Ups see how we are shaping for the markets. Sophie this tuesday, kiwi stocks are up about. 4 . This after mondays broad selloff from a two month high from mumbai to shanghai. Drop since may. Likely crossing their fingers that they can resolve the trade spat. In sydney might rebound a. Ouch with commodity moves oil is under pressure. Rising volatility. We are watching the jump in iron or prices. , we have the today policy decision and india earnings season kicks off. Thank you very much. Lets check on the first word news. U. S. State department has approved a possible arms sales to taiwan worth more than 2 billion. The deal is not confirmed yet. Prime contractors including General Dynamics and oshkosh. They were concerned about the move and firmly against it. An independent think tank said there is a significant risk that the u. S. Will meet its debt ceiling in september. Bringing that forward due to falling Corporate Tax revenue. They have been using extraordinary measures since march 2, when u. S. Hit it 22 trillion limit on borrowing. Iran said it has already enriched uranium to levels beyond. Atomic Inspection Agency confirms the enrichment. European powers need to find ways to offset sanctions. Enricheduch must be for nuclear weapons. Showing signs of recovery. Multipurpose vehicles rose in june from a year earlier, reaching a 1. 8 million. That is the first increase in sales. The demand has been hit by the trade war, domestic slowdown. Signs of a recovery in taiwan. Overseas shipments climbed half of 1 . Demand from the u. S. More than made up for falling deliveries to china. Fours for a decline of point 8 and only one of the 12 economists actually forecasting a rise. Global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. It appears that u. S. Investors are taking a cautious approach. Su keenan joins me with the latest. Exacerbated by the fact that we are coming off of a holiday weekend. Su we have the second day of the s p falling. Waiting to hear from fed chair powell. Lets take a look at the market snapshot. The dollar is slightly higher. Financial, one of the areas where we saw financial selloff. It has a lot to do with rate cut story. Look at futures, barely flat going into the tuesday session. We mentioned the big german Chemical Company. That affected the Chemical Company and it is in the bullseye of the u. S. Trade conflict with china and the levees there. The fifth analyst has put a reading up. We have not seen that the 1990s. It is surprising. Concern about the chip industry. Gainers and it has a lot to do with the ability to work around the hallway restrictions huawei restrictions. Sustain boost could not the negative sentiment and concerned about banks in general. Down on a Morgan Stanley downgrade on banks. There are multiple concerns on that front. One of the feud to benefit from Deutsche Bank cut. That theircided stocks were down as well. A twoyear high after the surprise data. Take a look at the chart. We could take a look at the gold price chart. They are the biggest we have seen. Quickly to oil, it has seen a lot of swings lately has to do with the gyration Going Forward. We saw all of the early gains stories. Shery thank you for that. Lets delve deeper into Deutsche Bank, shares tumbling, following similar losses in frankfurt. Radical Restructuring Plan fell flat from me, to london and here in new york. Many employees leaving with their personal belongings and a wide envelope. Idea where the cuts would be deepest . Is a brutal day on wall street. We do know that the biggest cuts right now will come in the equity sales and trading division. That is where they said they would initially exit. There are 18,000 jobs that could be cut. For thousandsts within that bigger number. It is not clear where the rest of the cuts will come from. A lot of employees out there in the jobs market. Where could they end up . Roomere is not a lot of for new employees in the banking sector. Hundreds of thousands of jobs has been cut in this sector and it is interesting. Desks, whate equity used to be a 500 person team is now a threeperson team. With the rise of automation and the huge amount of technological change, there are not as many jobs for humans on wall street anymore. Perhaps some will be able to transition to fintech, where their Banking Experience will be helpful, but it is difficult to see where all these people will land. Shery lets talk about asia. We saw employees packing up their bags. To be had any idea how the region would be affected . Away from the epicenter of where the decisions are being made. Asia areat staff in little bit upset and worried about the lack of nation from headquarters. There has been a decline in attendance in the asian offices. The Real Estate Agents in hong kong i thinking about who to fill the space. Staff,e bank reduces the who will take that place . Reporter, thank you very much for joining us on the Deutsche Bank story. Plenty more to come on daybreak asia. Exclusively about the Business Strategy in the region. Usry senior economist joins to discuss the biggest data stories this week. This is bloomberg. Paul we will soon get an update on the state of the chinese economy and how it is weathering the trade war. The latest gdp measurement coming over the weekend. Capital investors Senior Analyst joins us now. Numberse have trade later in the week. What are you looking out for . Good morning. Thank you for having me. Ultimately, we still think the economic data, specifically in china will be disappointing. Things like industrial production, retail sales they have been soft in china. Pmis are below 50 on average. Of a great signal manufacturing activity. That is why we think the chinese data will be quite soft. That leaves room for more policy , which is a more importants toy for the second part of this year. Pmi. We do have that soft they are optimistic as well. What sort of stimulus do you see coming down the line . In china we think we are likely to get more targeted Interest Rate cuts. The more important story will be about what happens on the fiscal side of things. Things like Infrastructure Spending. More of that is likely to continue, if we see this weakness in activity, which we think is likely. We will see more of those Infrastructure Spending measures around bond issuance. That should boost activity and maybe some moves towards the housing sector. There has been weakness in housing construction. Key points youhe mentioned is that they will be pretty targeted. Form of theape and stimulus package out of china, expect itou it to have an impact on their economy . It would provide a pretty solid boost, more so for the equity market because equity positivelypond quite. The boost to equity would be quite positive. Veal gdp, it will assist at the margin, but i think what is more important for the long run is, he would need to see resolution on trade talks. That will probably not happen over the next fix months. It might be a story for early next year, what should drive the economy into a more solid footing. We need to see global indicators becoming more solid and resolution on things like brexit as well to get Investor Confidence back to where it was. Shery we seem to be looking at the patchy numbers when it comes to credit expansion within china. What are we expecting for the month of june . We still think that there will be further weakness in the credit numbers in china. Ultimately, the government has been on a mission to try to get those credit numbers under more control. If we think about that in a holistic sense, that is positive for financial stability, but investors might see that as a sign that credit growth in china is not growing fast enough to generate gdp growth above that 60 level. That is another reason for why we do things. With china, it is a bit opaque for when that will come through. Investorsthing that should keep in mind. Chinese stocks have not been doing too great over the past few months. They probably have more upside compared to other global equities. Yuan where do you see the heading in all of this . Fed might do something. That would serve to weaken the greenback. Dcf becoming a theme . We do do you see it becoming a team . We do. It is hard to see significant downside for the dollar because Global Growth is still pretty soft. We need to see those pmis strengthen if we are to see other currencies becoming stronger. Even though the Federal Reserve is likely to cut Interest Rates, we do not think the race cut is likely in july. Probably thisut year. That will not be enough to drive u. S. Dollar significantly lower in this environment where you still have Global Growth disappointing. Put too much emphasis on the downside until those numbers become stronger. We need to see a stronger euro. Do not only have trade tensions between the u. S. And china, but now between japan and south korea. Will this boost rationale for the bank of korea to start using . There is definitely pressure on the bank of korea to do more policy stimulus. There is also a lot of Political Uncertainty in korea at the moment. Add to thatnsions uncertainty. We can see that here in australia, cutting Interest Rates back to back by 50 basis points or lower. It is the Global Environment where banks are under pressure to ease policy. The bank of malaysia easing Interest Rates. Cut outnot put a rate of question for the bank of korea. Shery thank you for that. You can get a roundup of the stories that you need to know to get your day going. Mobile. So available on you can customize your settings to get the news on the industry and assets that you care about. This is bloomberg. Paul this is daybreak asia. Shery im shery ahn new york. South korea hinting at potential overtime nation against japan. The vicious cycle of measures and countermeasures would not be ideal for both countries. South Korean Companies began experiencing damage, the government would have no choice but to respond as necessary. To withdraw its measures. Reinvigoratedve decades as bilateral tensions, and it could have farreaching implications for the tech supply chain. Tom joins us from tokyo. Explain to us what this is. It is more like a license. Is this similar to what we are seeing in the u. S. When it comes to huawei . There are similarities. Now betweenening japan and south korea, if you are a company in japan that tells key material to south korean retailers, you had to get a license approval for that license could take 90 days. Those are the two types of products that would be most affected. They are major south caribbean specializehat really in these products, particularly memory chips. Those are some of the products that would be affected. That would really disrupt the Global Supply chain of things like smartphones and other Computing Devices that rely on displays. Audibled phone is just one example. There are a lot of ways that companies throughout the supply chain could be affected by this. Paul it is not really in the interest of japan or south korea to see this ethically too much further. Analysts andto they said we are already seeing the impact on south koreas Largest Companies losing billions of dollars in capitalization. This could backfire and hurt some of the smaller Japanese Companies that specialize in the materials. Those are some of the most immediate. , if youemiconductor have a situation where the buyers of these products have to look elsewhere. A taiwanese company, a u. S. Company those are potential beneficiaries. Remember, south korea accounts. Or about 60 of the supplies anybody who relies on those, china, the u. S. , major smartphone manufacturers could be affected. What we are seeing that some of the Companies Looking for alternatives, looking for different places that they can source the material, but also procure the chips and blaze. Of contingency plans being put into play. Much. Thank you so lets get a quick check of the latest is this lash headlines. Cutting fullyear sales and profit forecast on the slowdown of the weakening market. The Company Knows a disappointing Second Quarter and earnings will be as much as 30 lower. The chemical sector has been hardhit are the trade war. Raising about 1. 2 billion dollars by selling its remaining 18 take in the bank. The sale began after the markets closed in milan and comes to months after the 17 . Performance head of a new, threeyear year strategic plan. This is bloomberg. This is daybreak asia. Tumbled as the latest turnaround plan fell flat with market. Analysts say the ceo profit goals are too ambitious, opposing concerns that they are focusing on a contested home market. The irish Prime Minister says eu leaders would feel a great deal of reluctance about giving the u. K. And other brexit delay. Many eu nations are frustrated and would only consider postponing for a good reason, such as a general election. Euy say they would leave the with or without a deal. Many are ready to walk. And you Prime Minister has been sworn into the role. The finance ministers received minute millions and commitment loans. She won the election on pledges to cut taxes and negotiate better terms. Isd manager Jeffrey Epstein being held at a Correctional Center in new york at the away bail hearing on charges of sex trafficking. They carry a minimum of 10 years in prison if he is convicted. He pleaded not guilty in court on monday. The charges are very serious and carry a maximum sentence of 45 years in jail. That is basically a life sentence for someone his age. When you have two planes and live much of the year abroad, we think flight is a real risk. Global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Shery lets get a quick check on how markets are trading. 4 . Stocks i down second consecutive session. As we continue to see, weakness in the aussie dollar for a fourth consecutive session. Futures. 3 . This could be in relation to the japanese yen falling for a third consecutive session and being at the weakest level against the u. S. Dollar. This after falling more than 1 . We continue to watch those south Korean Companies that could be influenced by japanese restrictions on some exports to the country. Global spending on food delivery may rise by doubledigit to 300 to the by 2022 according monitor. That rapid expansion is helping uber diversify beyond its core business. Ridesharing is banned in japan. The service is is within reach of the population. I discussed all of this with great eats. He joins us now from hong kong. Great to have you with us. Give us a sense of how important asia is uber and uber eats. Overall, if we look at uber eats, the way that you mentioned, what we are seeing is is the largest food Delivery Business in the world outside of china. Continents. N six asiapacific is one of the fastestgrowing markets. Our three top Global Markets are here. We had indiana, australia and japan. There,seeing huge growth working with Restaurant Partners. Seen the number of Restaurant Partners double just within a year, as well as on our platform. We have tripled the number of consumers in that same timeframe. It is aof our strategy, massive part of our growth globally. Eatsost amount of uber orders happen on a weekly basis and asiapacific. Shery you mentioned india earlier. How much are you investing in operations there . How are you doing in india . Great Growth Market for us. We are in 38 cities. Citiesot just the big that are growing. It is what we are seeing in smaller cities as well. We worked with over 20,000 Restaurant Partners, so we work with big name brands like mcdonalds and subway. A lot of local favorites. We are investing in innovation. We have our largest virtual partnership there with cafe coffee day with over 1700 locations. They are partnering with us exclusively with brands that are only available on uber eats. In terms of deception, india is a pretty big case. They have been delivering lunchboxes around the city. To what extent will they put this very old business out of business . Is definitely an institution, but what we are seeing is the overall delivery landscape in markets like india and japan is being pulled forward. Have seen a huge behavioral change with new customers coming online. Inis still early days markets like japan, india and across the asiapacific. Marketng like 7 of the is actually doing online through delivery on a weekly or regular basis. A huge opportunity for growth there. We heavily focused on moving beyond food delivery and helping the ecosystem as they evolve. That is an ex