thereabouts. picking up where it left off. resumes, let's get to market contagion. these are some of the asset classes. health care is having a good time of it. we did see a bit of a fall back session on health care relations. fallingokings are people fear getting the virus. discretionary's are pretty much flat at the moment that is the current state of play with some of the subsectors . this is a look at the chinese markets. you can see further weakness in the yuan. let's get off to new york and first word news. >> we start with lebanon, which hopes to end three months of unrest with the announcement of a new government. professor at beirut american university will head a cabinet of 20 ministers. backed by acialists wide array of parties. he takes office after weeks of street protests sparked by the resignation of the then-prime minister. jeff bezos's mobile phone was hacked after receiving a message the crown prince of saudi arabia. analysist said digital suggested it started with an infected video file sent from the personal account of mohammed been some on -- bin-salman. it is unclear if the alleged hacked accessed sensitive information. south korea has expanded faster than expected supporting optimism that a recovery may be underway. gp increases from the previous time, expanding at the fastest pace 2017. they are pinning their hopes on an export turnaround as a trade tensions a thought. -- thaw. more than 5 million cars are being recalled in the u.s.. honda is calling back more than 2.5 million older vehicles for defective airbags. the recall covers honda and acura vehicles from 1996 through 2003. meanwhile, toyota is recalling millions of cars over a faulty control unit that could cause malfunctions in airbags and seatbelts. global news, 24 hours a day on air, on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. >> the coronavirus continues to spread with the first case reported in the united states. health officials are struggling could -- to contain the infection. david: our china correspondent has been on top of the story. give us an update. >> we have the chinese national health commission holding a press briefing about prevention and control of this disease. the concern is that travel has already begun for the major new year holiday where 3 billion trips are expected across the country. we have the world health organization discussing whether --not this qualifies qualifies as an international health emergency. the virus has affected some 300 people and more than 100 were discovered this over this past weekend. the big concern is that even though the fatality rate has been low, there are concerns it could mutate and get more deadly because those deaths we have seen have mostly been the elderly folks with pre-existing issues. we are just getting these pictures from the china health commission. at the moment is the deputy director of the health commission. all of this as we try to examine what sort of response we have had out of chinese authorities. has there been a degree of further disclosure that was missing before? >> the government response has come a long way, especially since the sars outbreak in the early 2000s. that was a landmark moment in , ass of transparency reform well as the government spending millions to upgrade their systems. , china was widely criticized for trying to limit and deny the scope of the disease. release thehey did genetic sequencing of the disease the other countries could identify. you also have all sorts of levels of government coming out with public health announcements. this briefing is exemplary. mustnping is saying this be taken seriously and there will be great consequences for officials who try and cover up cases. you have all levels of government trying to emphasize how critical it is. in beijing, you are seeing heightened awareness and concern with many people wearing masks and companies passing them to their employees as well. yvonne: and a daily communication system. selena, like you. there are no -- selina wang, thank you. thate lam told bloomberg hong kong is planning for the worst. >> hong kong has already put in place a vigilant system. we have learned from previous incidents of other diseases. in order to bring the community together to control any infectious diseases, we have to be very vigilant. >> just getting further information here. the commission has been saying we have had nine deaths from the cases of viruses across 13 provinces and cities. also putting in some strict controls of food markets and banning live animal trade. that is the latest coming through. that is-- david: roughly doubled the latest number they came up with. 440 cases. >> and nine deaths. david: we had six deaths before this number. they have banned all live animal trade, as you mentioned. what we have here is a degree of transparency taking place. over to the goldman sachs global macro conference in hong kong. stephen engle there, take away. the chief global equity strategist for goldman sachs peter oppenheimer. thank you for joining us. we can talk about the short-term outlook of the global equities in the structural issues, but short-term markets are looking at this virus with some trepidation. is this an opportunity to cash out or genuinely a concern? >> the concern is clearly there because there is a precedent and it was a difficult time. it is a very difficult thing to protect where it goes. we all hope for the best but the markets tend to react quickly, hitting the areas most likely at the epicenter. seen inay it has to be the context of how much markets have run up. it's one of the things that could lead to something of a correction. >> there have been cases in washington state in focus as well. where do you see 2020 going? you still see momentum going for u.s. stocks, but not as much room to grow? >> that's right. peter: context is important here. last year was interesting because it was the trough of a bear market. then we had a change in fed ance -- guidance helped stimulate a big rebound. global equities were up. only aboutly, with 80% of the average volatility. almost all of that came from multiple expansions. canhen: what kind of growth we expect when you have the added risk of a presidential election? peter: you have higher multiples that would imply low returns. we do expect modest profit , but in mostear markets, we think margins have generally peaked. rising, ittiples gives you the high single digit types we would be expecting. what would be your advice to clients who are too heavy on west equities -- u.s. equities? iner: one of the key themes equities has been the dramatic outperformance of the u.s. that has made sense. strongerhas seen much earnings per share growth. go back to before the financial crisis, s&p earnings have grown roughly 90%. across asia, roughly 15. in asia, only about 5% cumulative earnings growth. the difference is partly reflected in the different those exposure her differences have really .xplained the outperformance this would point to more diversification. stephen: where in asia? we just got great numbers out of taiwan. there has been on shoring at manufacturing because of the trade war. south korea was just out with good quarter on quarter gdp growth. so where and asia? peter: asia, generally, is a more cyclical market in the global context. the u.s. tends to be more growth defensive. but these markets have benefited from the uptick in opportunism. they're starting to see more macro data coming through. we've seen decent production numbers in china. we think the chinese market, which we have been positive on, is looking quite attractive. so i think there is upside across asia this year. but int think it's huge, the context of the high valuations of equities generally , markets will be sensitive to upsets. we would not expect to see such low volatility. stephen: are the headwinds associated with traded taken away or was that a low hanging fruit? it was a easier deal than the structural issues. i think that is a very good point. escalation has peaked and markets have dealt with that in a positive way. but we don't think that completely clears the field in terms of tariffs. there are difficult further negotiations to come. how that goes depends on the political context as well. but for now, at least we see probably the peak of that tension. that should mean you get a recovering in some manufacturing data. that is fairly supportive of more cyclical assets. you are cautious on china, but would you be more positive going into the lunar new year? we are already seeing the drag on retail sales and catering and the important human migration. peter: very important. vulnerable to a correction in the short run. we are seeing a little bit of that volatility now. that's why in aggregate, we don't see that much upside. but we do see making progress in the context of this economic cycle continuing, bearing in mind that this is already the longest expansion in years. it is likely to continue and generate higher profit growth. stephen: i have not even mentioned brexit. you mentioned you think there is a little more confidence? stephen: absolutely -- peter: absolutely. we have seen the u.k.. the data remains weak and that is largely historic. there is likely to be a fiscal boost following the budget in the next couple of months. ,rom a sentiment perspective having a government that can get clarity of and the getting the withdrawal treaty done,h and getting brexit though there are still lots of negotiations to be done. the sense that it is being done allows people to sort of refocus and have more confidence. oppenheimer,r thanks for your time today. david: good stuff there. we are going to recap some of the lines that came through. talking about this interview out of the china health commission. what do we know here? some -- is putting having some restrictions put on it as well as hubei province. that is the chinese director of the deputy health commission speaking. yvonne: they are going to adopt strict monitoring and disclose relevant information in a timely way. they're trying to get ahead of this and share information on the virus internationally. we will bring you more lines once we do see them, but again, nine deaths reported. still ahead philip president aump disk -- trump made dismissive comments about climate change. we hear the views of larry fink. later, how china aims to reduce emissions. >> we are back with the diversity of views at demos this year. the climateump and campaign are competing for the spotlight. david: the swedish teenager brought a stark message. >> the climate and environment is a hot topic right now. there are a lot of young people pushing them up but to see it from another perspective, nothing has been done seeing as the global missions of co2 has not reduced >> -- produced. that is what we are trying to achieve, among other things. we are all fighting for the environment and the climate. from that aspect, what has been completely done, seeing it from a bigger perspective. basically nothing. >> this is not a time for pessimism. this is a time for optimism. doubt is not a good thought process. this is a time for tremendous hope and joy and optimism. but to embrace the possibilities of tomorrow, we must reject the perennial prophets of doom in their predictions of the spirit -- of the apocalypse. dabo's, weo asked spoke with larry fink about the risks climate change poses to investing. , it was aar confluence of many different inputs we had. worldwide, clients have been aking me about how to frame portfolio with climate change considerations. it's clear to me that this is becoming a dominant theme with more and more of our investors. we should not avoid the conversation about climate change. it is now becoming an investment risk. no differently than investors focus on the yield curve whatever form of risk is clearly we need to now bring forward better risk tools to navigate. was asking more companies to be self reporting on things so that we have better clarity and understanding how companies are navigating these issues. of is to find ways while weg those risks are dependent on carbon. my greatest concern is not that we as investors and capital markets are not going to find capital to invest. my biggest fear is that the dependability and dependency we have on governments. governments working towards these long-term objectives. is not going to be fixed by the central bank and it will be fixed by the combination of public and private. yvonne: that was the view of larry fink. let's get to your latest business flash headlines. boeing plunges after saying it expects the 737 max to return to service sometime this year. it reaffirmed its commitment to aviation safety and is positive the plane will be cleared to fly in the coming months. the faa has said they have no timetable and said the delays may cost boeing $10 million. jumped on news it may combine its rail business with a rival. they have held for limitary talks, of any tile could face antitrust scrutiny. year, regular does refused to cave into warnings about the looming threat of chinese competition. indonesia's harley-davidson drama turns another page with the election of a new ceo. they have been rudderless since the former boss was fired trying to smuggle a harley? the carrier is trying to restore its reputation. they spend more on plane rentals than any of their peers. david: latest lines out of this life press briefing on the coronavirus taking place in beijing. they are talking about it at ground zero here. they have the proper equipment and have strengthened the supervision of food sales. they have asked people to limit travel to what is only essential. >> this is just battering down the hatches. markets, some of these pharmaceutical companies have been rising. you can see this here. you can see this high-tech company here. reuters suggesting a 20% stake in the company. saying they are talking to volkswagen there is nothing binding yet. this corporation is based in malaysia. upgrade, given an moving the price targets. elsewhere, we can just see a bit of weakness coming through your -- through on some of those companies related to the hospitality and property side of things. this is bloomberg. ♪ >> i'm su keenan with your first word headlines. we start with the latest on the virus. chinese health experts say there's a possibility the coronavirus would mutate as it continues to spread. six people have died and the first reported case in the united states are some of the latest headlines. a health-care care official and china has confirmed the virus is more easily transmitted than originally thought. china is tightening passenger screening ahead of the mass migration. macau arerators in expected to show declining quarterly profits this month. a bloomberg survey says at least half of the big players will post earning declines for the december quarter. the industry has had a rough year with the trade war uncertainties, slowdowns in china, and a crackdown on gaming . there is also expected to be some downside. >> meanwhile, the indian supreme court sits later on wednesday to hear petitions that challenge the constitutional validity of the religion-based citizenship law. the controversial legislation has sparked violent protests across the country. the court will consider requests to have the law withdrawn. the hearing is expected to go into next week. north korea has extended its moratorium on a nuclear missile test, saying its opponents have failed to honor their commitments. a senior official speaking at a reportedly --e is was reported to have said there will never be denuclearization under what he calls hostile u.s. policy. global news, 24 hours a day on air, on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. >> china is reporting nine deaths now and 40 coronavirus cases as it pledges to do its best to curb the spread of the disease. david: selina wang is in beijing. she has been tracking this press conference going on. what else do we know at this point? >> we are still getting headlines, the level of detail on how health officials are responding is more than expected and shows this is catered to a domestic and international audience. there are nowed, nine deaths and 440 people expected. there are rising numbers across 30 provinces. it has spread beyond china's borders to japan and south korea, and thailand. the first case in the knot states has heightened global scrutiny and concern. authorities have also put a daily reporting plan for upticks on the virus. there are also getting regular updates from the international community and this shows how far china has come since the early 2000 stars outbreak -- sars outbreak. you had officials mentioning that time and authorities have created a prevention and disease control system. they spent 10 billion upgrade the system to catch these types of diseases and many reforms have been put in place. you have officials saying this is of the utmost concern and that officials will be badly reprimanded if they are shown to try and cover up these cases. in addition, you have the fact that the officials have to be held more accountable and transparent because they have social media. asking forve been more transparency and daily reports and officials have no choice but to respond. we heard the line from xinhua saying there is a risk of this virus mutating. how big of a risk is that that this could actually spread further? >> there are still questions about how exactly this originated. authorities said that they are going to be limiting the types and live markets animals. this will be kept to a minimum because they believe this to have originated from a market where there were wild animals interacting with humans? -- humans. but this risk of mutation is the real fear. the mortality rate has actually been regularly low. it could be higher according to some researchers, but many we know who have died were elderly pre-existing concerns. but the concern is that we still don't know exactly how this will continue to develop and what exactly the origins are your -- are. we know it can be spread through contact. the authorities are working hard with international health organizations try and determine how this may spread. we have health officials saying they are inviting the world health organization for on-site visits. david: we will continue to track the story. live go will take you to this ongoing press briefing. several sectors have been tracking -- we have been tracking since the start of the spirit -- start of this. we have another graph which takes you through some of these antibiotic makers. frankly, there should be no reason whether would be limits. -- why there would be limits. anyways, that's a different conversation. that's your market check here for now. up, will be speaking to the world economic forum managing director about how rising income inequality is threatening the global economy. this is bloomberg. ♪ yvonne: this year's world economic forum at babos comes at a time when income inequality has spoke -- sparked protests across the world. oxfam says the top 1% holds more wealth than 60% of the world's population combined. the leader of the world economic forum says there are signs the gap is growing. clearly, there is income inequality globally and possibly the threat of rising inequality. that is being perceived around the world. we did a chief economist outlook a couple of weeks ago and one of the biggest threats is likely to be economically-motivated social protests. so we have tried to find the pathways to economic mobility and how to get economies going in a way that provides opportunity. we looked at 10 factors. some of those are standard stuff. education, but what has become really critical is fair. wages, social protection systems, destruction and industry transition, and lifelong learning mechanisms. that is something that has become nonnegotiable. doesat does not change, not matter if we do investment in education for the billion people already part of the workforce, they need lifelong working -- learning. francine: so who is getting it right or who is trying to make a difference? number one saadia: -- the netings states is 27. countries like brazil and india, unsurprised are at the beach. -- at the bottom. it is not just developing economies with this issues, it is large, developed markets like the u.k. france and the united states. david: do you see more governments -- francine: do you see more governments taking this on board? gdp are they looking at these indices to make an impact? saadia: this is going to be the decade in which governments have to take you seriously. -- take this seriously. ,he elevator keeps moving because if not, we cannot lift everyone. second is the industry transition that needs to occur we want a greener more sustainable economy. the third aspect is technological change. but none of this will really be possible if people don't have a sense of optimism. the sense that they will be able to give to their future generations a better life and better earning opportunities than they have themselves. so this agenda around social mobility will be critical. up to thebut is it government or private entities? saadia: that is one of the most interesting parts. barely, there's a lot of role for government but it's not just about increasing spending. it's about the mix. if you look at france, it actually does high levels of social spending. but if you look at the results, it's clear not the right type of spending. so this probably a different mix of spending and quality required and more dynamic mechanisms. big call for a stakeholder capitals this year and businesses will have to take into account social mobility. they have a big role to play because of the services they could be providing, whether it is education, training, health care, or safety nets and social security. there is a large role, for example for insurance companies to play. there is also what they can do in their value chains and communities and that is going to be the game changer for social mobility. focusing on are emerging economies and emerging markets. they stand on this? -- where do they stand on this? saadia: brazil is at 60, india at 76. china is at 45. theirse economies wants growth trajectories to remain positive, they will have to tackle inequality. david: that was the world zahidi. forum's saadia we are told apple is asking this taiwanese chipmaker to increase production as sales continue to search. they're also looking for a new chief -- cheaper iphone with production starting in march. exxon and tencent are in a joint venture to launch a mobile-branded car and teaming up with other partners to offer a digital maintenance operation. they are planning to integrate supplies of customers with other vehicle maintenance. mitsubishi motors are down on the news that it's german business is under investigation. saidfurt prosecutors police raided 10 sites across germany belonging to a witness in the investigation. mitsubishi's 1.6 and two leader engines are under scrutiny. -- litre engines are under scrutiny. we are with the top health officials in china. they have been in close contact with nations with reported cases. they have invited experts to learn more about the virus. they have intensified measures at border crossings. there is a chance of super evidence ond no supporting the existence of such. will stay on top of this and bring you the latest lines coming out of this press briefing. it could infect multiple people and that's what they are saying. there could be such cases but there's no evidence to support that. coming up we continue to track this press briefing. on the look at china front line in the battle against climate change. discuss whether the world's largest emitter of greenhouse gases has the right plan to bring things -- terrain things in -- to reign things in. founderhuawei's ceo and is shrugging off the u.s. imposing even stricter sanctions. speaking at the world economic forum, he says he is confident they can survive further attacks. while weight used to be an admirer of the united states -- huawei used to be an admirer of the united states. we are successful largely because we have learned from the u.s.. hired dozens of american consulting firms to teach us how to manage our business operations. during that time, the entire system of huawei is like the u.s.. the u.s. should feel proud of it. they have exported and implemented extensively, contributing to huawei's develop. -- development. from that perspective, the u.s. should not be overly concerned with huawei and its position in the world. regarding the list, we were added last year and it did not hurt us much. we basically withstood the challenges we did some preparations beforehand. mightear, the u.s. further escalate against huawei, but i feel it would not be very significant. we are already gaining from last year, i think we are more confident that we can survive even further attacks. but whether the world would be split into two systems, i don't think so. science is about truth and there's only one truth. any scientist who discovers the truth would make it known to all the people around the world. that was the way ceo and founder. david: climate change has been front and center at these discussions at davos. here are just some of the big voices we've heard so far. given the signs that climate change requires immediate action , this is the decade we need to start and we wanted to make good commitments. >> this has moved quickly from the social or corporate response but issues to fundamental value drivers. >> climate change will not be fixed by central banks and it will be fixed by the accommodation of public and private. >> we want to invest in green technology. >> for every major investment, we insist that the teams identify all of the climate change risks. >> we will ultimately divest if we think we are not getting the traction we need. >> we do need big breakthroughs. no one company is going to do this. >> china is on the front line in the global battle against climate change, but the question we are asking is can it change fast enough? david: that is precisely the question we will put to our asia energy reporter in singapore. nice to see you. good morning. what is the answer to the question? is following the same course that all industrial countries have had. they all had this massive industrial revolution lots of pollution. you can read some dickens if you want to see what london was like. it made people wealthy enough that they could demand cleaner air and water and it started to come back. that's where china is at right now. highstarted really hitting levels of omissions in 1975. now they are above the u.s. and europe combined. but while it took more than 100 omissions -- to emissions, china did it in 20. it's still going to take a lot more work in china for them to get there. >> a lot of work to do for them. of course, we are going to talk about how they are dealing with it as well and the various mixes of sustainability and the like. thank you very much. let's have a look at what is going on. this is a position we find ourselves in. and we haved bag stock indices moving to the downside. erasing some of the gains. the hang seng has been in the doldrums. coming back and please are off the lows. -- these are off the lows. david: we had a very low base yesterday given the drop we saw. markets aree starting to come up in the hang seng index is up as well. yesterday, the guest was in town for a conference and told us this was a good day to look for opportunities. that he wasold us looking at buying some of these casino names. benchmark, at that we are close. indicates we might see a bear sign there. the nikkei 225 on its lunch break right now. >> perhaps these words at a beijing health mission are assuaging fears it will be putting a restriction on will juan -- wuhan and the virus. we have got this line coming through that the governor has asked people not become to the city. current position and is perhaps creating a little more positivity. there also inviting experts to learn about the virus. it seems like they are trying to take hold of the narrative again that they have this disease under control or are at least being more transparent about government efforts to try and contain the virus after hearing about nine deaths. that number has doubled from what we learn that is spreading across 13 robinsons and cities -- provinces and cities. these cases are across wuhan and designated hospitals across the country. they are giving tips to people constantly your wash hands and be careful. this virus has some new features and that is the key thing they're looking at. is the skill just live animals or is it some form of human to human contact? >> absolutely. our guest was on the program saying they had evidence of person-to-person evidence -- contact as well. live go for our clients to stay on top of this. we will be back at a couple of minutes. is bloomberg's bloomberg -- this is bloomberg. club singapore. juliet: it is almost 11:00 here in singapore. we have the first case of the coronavirus in the united states. imposingeijing is nationwide health screenings. rishaad: and india's top court repairing to hear the merits of the new citizenship law. the leadingng from critics. this is bloomberg markets. ♪ juliet: confirmation the u.s. -- the coronavirus spread to the u.s. infected sentiment on wall street overnight. you have the nikkei trading higher by .5%. still seeing weakness on mainland chinese equities. stocks in fact having their biggest two-day drop we have seen since august, and australia's market back in the black, in fact, trading at records. when it comes to some other assets we are watching, we are seeing the yuan rise. better-than-expected gdp coming from south korea and we have also been watching the yield on china's 10-year note. at one point, it briefly dipped below 10% for the first time since august. we are seeing a lot of investors flee to safety on the back of the news about the coronavirus and ahead of the new you -- the lunar new year. we are basing some of yesterday's losses. these em currencies still being , but youhe coronavirus have heard from maybank, and they say asian currencies will more news on get that front, this limit to asian currencies could potentially be contained as well. rishaad: let's look at what is happening in indian markets as they get into gear. just lifting up have worked -- as we have seen this recovery take place for asia-pacific stocks, so looking at a start to the trading day which is likely to be a bit higher. the rupee pretty much stable and yielding 6.63 percent currently. just to tell you that what we have had our foreigners selling bonds ahead of this indian budget next week. let's get to new york and let's get to first word news. to thank you very much hopes and three months of unrest with newannouncement of a government. a 60-year-old from american university will had a cabinet of mostly specialists backed by ministers. he takes office after weeks of street protests marked by the resignation of the prime minister on october 29. jeff bezos mobile phone was hacked after receiving a message from the crown prince of saudi arabia. digital analysis suggests the data theft from the phone started with an infected oneo file sent via whatsapp the personal account of mohammad bin salman. it is on clear -- it is unclear if they hack affected sensitive amazon information. optimism a recovery may be under way. gdp increased one point 3% expanding at the fastest pace since the third quarter of 2017. south korea is pinning its hopes on an export turnaround and trade tensions thought between its two biggest trading partners, the u.s. and china. and more than 5 million cars are being recalled here in the u.s. honda is calling back almost 2.5 million older vehicles for defective air backs -- airbags by the now defunct takata group. toyota has recalled 3 million cars over a faulty control unit, and airbags as well as seatbelts. global news 24 hours a day on air and on quicktake by bloomberg powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. rishaad: just getting a report of another coronavirus case in macau at the moment. sends china -- sands china still moving up. selina wang is our china correspondent. where do things stand now? selina: the heightened concern is that millions of people across china are already starting to travel for this major new year holiday where they are expected to rack up some 3 billion trips. you have the national health commission in china just wrapping up a press briefing now. we are getting a number of updates on how they are trying to prevent the spread of this disease. the number of deaths has increased to nine people, all in the province with the center of the outbreak was. you have no 400 40 people confirmed to have been infected, hundreds of people being monitored. they are giving quite a bit of detail, more than i would have expected, about how they are expecting to implement the plan. they're setting up a plan for daily updates across the country, that they are going to be in regular contact with the international community about how it is developing about -- as well as of the world health organization that will be coming on site for screenings and tests. a big concern with the public is what exactly they should be doing to prevent this virus. there is still a lot of skepticism of public authorities, given how the sars outbreak was handled. china is saying they are cracking down on the wild animal commerce. actually, wild animals andive chickens will be banned in lujan. the disease is thought to have originated from a market in lujan where there is interaction between humans and animals. they are also asking people to avoid very densely crowded populated areas, which is certainly a challenging thing to do here in china, but walking around the streets, i am seeing a lot of people wearing masks, and not just because of the pollution. much more than usual, so there is heightened public awareness and concern about this right now. absolutely, seemed very interesting images of people. in terms of the official response from china, what have we heard? have heard all levels of government come out with statements on this. xi jinping has said this resolutely needs to be curbed. the chinese legal counsel saying any official that tries to cover up cases of this virus spreading, as happened during sars, would be severely punished. for some context, i want to remind viewers that back when sars broke out in the early 2000's, you saw china trying to limit and deny the scope of the disease, which china was widely criticized for, for actually increasing the spread of the disease because of that, but that was quite landmark in the terms of the reforms that triggered around transparency. china then set up a center for disease and prevention. since then, china has spent some 12 billion yen to upgrade centers for disease prevention. you have much more transparency from state media, from officials, but i also want to point out that they are being held accountable in another way with the advent of social media. you have netizens complaining they want more of these daily updates, they want more communication. a lot of complaining about why it took official so long to say there could be human to human transmission. now concerns there could be mutations. even though the death toll is low now, mutations could cause the disease to be more deadly, so you are seeing the government respond to that and work with governmental organizations more closely than previously. rishaad: thank you very much. we've got thailand coming out of the moment, the government they're coming out with a statement that four people have got confirmed cases of a new sars-like virus. it shares many similarities with the sars virus. a very similar pathogenesis well. at the moment, they are also ining, the thai government this statement, they will be talking about these new viruses here as well. this just coming through at the moment that we do have for confirmed cases of a new sars-like virus. there also are at the same time concerns in hong kong that the disease could spread. known confirmed cases -- there are no confirmed cases thus far. chief executive carrie lam saying the city is preparing for the worst. >> as we learn from previous incidents over sars and other infectious diseases that in order to bring the community control any infectious diseases, we have to be very vigilant. more on thisave coming through now. thailand just saying they have no moral for confirmed cases. at the same time, taiwan taking preemptive measures as well and we have at the moment the suspension of inbound tour groups -- visits by tour groups coming from the city of wuhan. that is currently what we have and that is the latest. still ahead, we will be hearing from an indian industrialist on the state of the economy and the ongoing protests over this controversial citizenship law. juliet: as india's top court wepares to hear that law, hear opposition arguments against the bill. this is bloomberg. ♪ rishaad: back with headlines oning through the moment, the coronavirus. macau confirming they have its first case of what they call the novel coronavirus. saying they have 4 confirmed cases. on top of that, taiwan has suspended inbound visits from tour groups coming from the city of wuhan, seen as the epicenter of where this disease is spreading from. let's change tax and have a look mindst is going on in the eye of our next guest. he no doubt has views on with this virus and how it is affecting market sentiment. he has a wider view on the trade front and volatility through the course of 2020. saying inll, you were your research that you think this is something which will blow over. it may well do, but the question is -- when? >> at this stage, we clearly don't know. it started around november, december 2002, almost entirely the third quarter. i would say the april, june quarter was possibly the worst and by the july-september was pretty much behind us. if we draw a comparison to that episode, one would think this is possibly a one or two-quarter phenomenon. as of now, it looks milder than the sars virus. clearly, i'm not an expert on that, but are owing from opinions that we've been hearing, it looks like the fertility rates are way lower than what we've seen. rishaad: currently, this is the stock impact of sars and this is what you are talking about, but we now have thailand reporting. .e have macau reporting there we go. this is showing how interconnected the world is as well. thate must appreciate prevention methods are way more advanced today than they were 17 years ago, but at the same time, the bigger risk arises from the way tourism has exploded. isward tourism from china much higher than it used to be. if one balances out these things, i think there is a short-term risk, but it is exactly that. juliet: that is sort of what a lot of our guests have been saying, that if you are a longer term investor, this is not something you will probably be looking at, if you are in equities, in particular for your pension, for example, but when you look at this short-term effect, where are you staying away from? you mentioned the tourism impact. >> there are certain sectors which are obviously more impacted than others. retailing, tourism-related stocks like airports and hotels. betweencases property-related sectors which depend on retail rentals. these are the ones that investors may be advised to stay away from in the short-term. some of these may even provide buying opportunities if the reaction is to sharpen the near term. on the other hand, sectors which are more secular, which offer more long-term growth and excess returns, they would be relatively immune to this. i would say domestic consumption, particularly consumer staples, some of the consumer proxies, and most recent upside we are seeing inditex hardware and semiconductor area, which have actually led us to upgrade korea in our portfolio -- these are examples of those relatively longer-term performers. juliet: it is interesting, you changed your tack on korea from when we last spoke to you. i wanted to quickly ask you about hong kong because that was a market particularly hit hard yesterday on the back of these fears, but of course we know there was also the moody's downgrade. you have calls for the hang seng index. we are starting to see some bullish signs here with it looks like the hang seng index could actually form that golden cross. >> i'm not exactly a technical analyst, but we do have that target, and the basic assumption is the price-to-book vertical of remaing seng index would pretty much unchanged. we have seen some degree of re-rating in 2019, and we think that while we are seeing return on equity improvements all across asia, in case of hong kong, it may be relatively more muted, and that is why we have a price-to-book multiple over there. rishaad: not exactly ambitious target. not exactly sticking your neck's out on this one, are you? >> we are not. rishaad: what about where you are looking? what areas are you looking at at the moment and what will be the potential drivers? >> china, india, korea, and .hailand on thailand in particular, we have been disappointed, but we are still continuing with that bet. given ther surprising macro economic slowdown we continue to see. china, predominately on the domestic consumption internet, stimulus where banking on. rishaad: has your rationale changed since the signing of the trade deal? line >> we were anticipating signing of the deal right since 2019. we don't think there will be much to look forward to after this. , the two and phase three mentions of those deals, that is far more difficult. rishaad: there is an irony with this because it is all about opening up the market in china as well. this deal is also very focused s, metrics here, quantitative' if you will. the point is that they have to be issued by the state, so that is the ultimate contradiction, isn't it? >> in a way, yes. that is why we believe that beyond this phase i deal, achieving something more or something bigger would be difficult. deal hasme time, the trade numbers, if you look at trade numbers, they are already beginning to show signs of uptick. are seeing an improvement in global demand, particularly inditex hardware region, and that has driven demand from taiwan and korea, but i think it all fits in with the basic hypothesis we have been propagating. juliet: many see that flow through as well. we talked to you in december when you were underweight and now you are overweight in korea. what kind of earnings growth are you expecting from some of these big semiconductor players across 2020? clearly a theme. if one looks at the demand from ai-related drivers, in particular the data centers, that part of demand almost died down in late 2018 and the first half of 2019, so there's a lot of room for recovery there. we are just beginning to see the sost signs of such recovery, yes, i would think that the earnings growth for major tech hardware suppliers, both in korea and taiwan, would clearly 30% or 40% like we have seen in previous cycles. the previous cycles are stronger, no doubt, and we are not really factoring in that kind of earnings growth, but given the kind of valuation support that some of these tech companies have, it is clearly time to buy into them, and that is what we have been doing, even in our portfolio, right from late 2019. rishaad: thank you very much for joining us. a lot more ahead including a look at this controversial citizenship bill as it goes to the supreme court in india. we will be discussing that with a vocal critic. that is coming up ahead. this is bloomberg. ♪ juliet: we are looking at live jews of washington where president trump's impeachment trial is, of course, occurring. we've been seeing a number of democrats accusing the president of abusing his office. this is all happening on the senate laura live in washington. the senate once again voted along strict party lines to reject a democratic amendment to subpoena acting white house chief of staff mick mulvaney to testify in this impeachment trial. let's bring in more with our senior editor who is in singapore. tell us, what is the latest happening on the senate floor in washington. senate's right now a little bit stalled on trying to figure out how to proceed forward. democrats are asking for a lot of things related to testimony, related to document production. they are asking for the senate to subpoena some of these things that the white house has not been willing to give freely. so far, the republican-held senate has been rejecting request after request after request, so here we are. this is the opening airing of grievances, if you will, between the two sides trying to set the tone for this overall impeachment as it is going to go forward. mitch mcconnell, the senate republican leader, is a bit of a master of senate procedure, and the way he has set it up is pretty simple. a fairlyallow for speedy trial that would conclude possibly by the middle of next week with an acquittal for president trump. that is the republican goal in this sort of all along and right now, democrats are not getting their way on any of these sort of requests, but they keep offering them, so it is unclear how late tonight this is going to go. of course wehing will continue to watch. thank you very much. rishaad: having a look at the latest news headlines concerning the coronavirus, the thai government confirming they have .our cases of it this on top of macau reporting his first case of this virus in that territory as well, and on top of the chinese government coming out and confirming that there were nine cases. this is what we have as the shanghai composite goes to lunch break. recovering from the lows of the day after some reassurance coming from the health commission, but we can see some of these pharmaceutical companies doing quite well as a result of people betting on the need for the demand for goods coming out of them. one of the more actively traded stocks in asia is for a company called top glove in malaysia. they make gloves and also facemasks as well. this is the position for the shanghai composite as we go for this lunch break now. you are with bloomberg. ♪ juliet: it is almost 11:30 a.m. here in singapore. kind of half/half in terms of what is in the black and what is in the red. we are also getting breaking news out of washington. we were just talking about that with derek wallbank, with the senate rejecting the schumer amendment to subpoena documents. we will continue to keep you updated on that as well. let's get to first word headlines now with su keenan in new york. on we start with the latest the mystery virus. china says nine people have now all inom the coronavirus the province of hubei where it is thought to have originated. officials say there are 440 .ases of the virus new cases have also been reported in macau, thailand, and u.s. the country's state run news agency reports that health experts are saying there is a possibility that the virus could mutate. meanwhile, president trump has been using his time at the world economic forum in davos to lash out at environmental activists. he avoided on expanding on this year's key theme of climate change, issuing a dismissive reference to what he calls alarmists who are determined to "control every aspect of our lives." one of his biggest critics is swedish teenager anta thunberg, who is also davos. she has accused her audience of empty words about climate change. indian supreme court is expected to hear petitions challenging the constitutional validity of the government's religion-based citizenship law. 's controversial new legislation has sparked violent protests throughout the country. the hearing is expected to extend into next week. and returning to davos, hong kong leader carrie lam has told bloomberg that china has no intention of tightening its grip on the city. she spoke at the world economic forum in davos and said that president xi has given her his personal assurance that he will not use the long-running street protest as an excuse to increase chinese control. assuretrying to investors that hong kong remains a stable financial hub. >> the central government has time and again made it very clear that they want hong kong to succeed under one country two systems and a high degree of autonomy. that was made very clear to me by president xi jinping on three occasions that i met him in a couple of months' time. news 24 hours a day on air and on quicktake powered by bloomberg. juliet: asian stocks looking a lot better than they were this time yesterday. we are seeing a little bit of a recovery bounce in a lot of the markets following the selloff yesterday triggered by fears about the new coronavirus. market also doing well. we had south korea's economy growing at its fastest pace since 2017 in the fourth quarter and the australian share market once again hitting those records today. rishaad: we have right now the possibility of the gain at the start of the session about 13 minutes away, thereabouts. .4% and the rupee stable. funds turningobal net sellers of indian sovereign bonds. we have expectations really at the moment growing of a wider budget deficit. we are looking at the first selloff in four months. mahendra mahendra saying indian slowing growth may be a good think. he says growth may surprise to the upside sooner rather than later, telling us why he thinks the government is taking the right steps. was under way for a while now is the detoxification for the economy. the prime minister has been quite obsessed that the kind of growth he wants is growth that is transparent and free of any kind of corruption. at that succeeding mandate? >> i believe the perception right now is it has caused this kind of slow down, but on the other hand, if you are going to detox yourself, you always have a process of cleansing before and start recovering and running again, and i think that is what is happening. the demonetization had in mind. the tax is making it impossible for people to work in a nontransparent manner, but it has caused disruption to because people who are used to trading in cash and off the radar now have to be on the radar, so there is an enormous adjustment process under way. i think the government has realized that in order to get the engine moving, they need to be far more propulsive, if you will, for the economy, propel consumption, forget about obsession with the deficit for too long, and they are taking the right steps now, so i think my experience is we are already seeing signs of life, and i think from the next fiscal year, which starts in april, i think india will surprise on the upside. tom: you are a third-generation industrialist within india. you were born with privileges, and you have taken it so much further than that. explain the generational divide within india. each country seems to have a .tory of young people rebelling explain the generational divide within india. >> i use to, in fact, bemoan the fact that a lot of the young did not seemnnials to be protesting. i'm from the woodstock generation. it was a rite of passage. i used to think that if you don't protest, if you don't have a cause, you're probably suffering in the iq department. i was giving up. i thought everybody was at a three-minute attention span. youtube and snapchat. when snapchat happened, i almost gave up. i think for young people to want to have a cause is a good thing in my opinion. setet: india's top court is to examine petitions challenging the constitutional validity of a new law that introduced elysian-based criteria for citizenship. the move has sparked a month of often violent protests across the country. great to have you with us. how do you think that the supreme court is going to react to this challenge on the legality of the law? >> it is difficult to predict. for many of us who oppose the law as i did in parliament and outside it, it seems nfs lee a betrayal of everything the freedom struggle stood for. when the idea of pakistan came religion should determine nationhood, many indian leaders said no, religion does not determine our nation and our freedom struggle is for everybody, and the indian constitution recognized that, so it seems to us to be manifestly unconstitutional to list a few religions that are eligible for fast-track citizenship. however, other legal experts do argue that if it betrays the spirit of our democracy or not, it is within the letter of the law. only the supreme court can adjudicate that and we will have to wait for them to do so. >> as we've been saying, the government seems to be refuting -- refusing to budge, but so have protesters, so it does not seem to bode all that well. >> no, it does not, and considering most of the people listening to your show are investors, there is no doubt that social unrest needs to lack of investor confidence. it seems to me that just the news a few hours ago that moody's had downgraded hong kong's put it rating because of the government's failure to address protests there suggests to me the government is simply completely wrong in india in the way they have been handling or failing to handle the very genuine and spontaneous protest. dismissing this as some sort of politically orchestrated campaign is sheer folly because the politicals, parties, are basically addressing their own workers. i have done a few of those rallies myself, but what we are seeing in every university campus and every town square and many university campuses and even on the streets is ordinary people touched to the quick by a profound sense that what their country is all about has been challenged for the first time by their own government and that they are basically standing up .nd saying, "not in my name this country has got to be what we want to inherit in the years to come." i think it is a very powerful, very spontaneous protest, and i think it is extremely unwise of the government to continue her meaning and denial and not dealing with it. many of us suspect that their failure to address this actually demonstrates that the economic development agenda they have touted for so many years was just a mask for their real agenda, which is this kind of cultural nationalism, bigotry, the social agenda, if you want to call it that, that has been unleashed in the last few months since their reelection victory. thisad: are you suggesting is a diversionary tactic, possibly? but this goes to the heart of what the bjp is about, and of course, it's other elements. >> exactly. i'm saying the economic agenda was the diversion. that was the smooth talk to get elected. this is the agenda. they want to turn india into something it has never been and was never intended to be because they come from a movement which indialy wants to make into a hindu space rather than the secular liberal democracy it has been for decades. i think this law is merely the thin in the very much larger well. they threatened to fall -- followed up with a national well of citizens, which will clearly seriously risk disenfranchising large numbers of the muslim population, so the social agenda and social unrest does not seem to faze them because that is really what they are all about. the economic smooth talking has now been laid bare for the empty , hollow shell that it was. rishaad: we have had this bill building a picture, but others would argue, what is wrong with majority arianism -- majoritarianism ultimately? >> it is not democracy. the entire point about democracy is the acknowledgment of individual rights, the respect for equality, the tolerance, indeed acceptance, of different points of view. all of that has suddenly been thrown out the window, and the irony is it was working very well. it is not as if india's democracy, which, of course, has its flaws like most moccasins do, but it is not as if there was a widespread national discontent with our way of doing business with each other. this was a country where people actually managed to resolve their differences at the ballot box, which has seen innumerable transfers of power in both the central government and in the states, which had a three and -- free and thriving press that contributed heavily to defeating the previous government, so in many, many ways, it was a thriving, functional democracy, and in the process, a magnificent advertisement for the management of diversity in a developing country. there is no country on earth with the astonishing diversity india has of languages, of castes, regions, colors of skin, cuisines, customs. all of that is what made india such a shining example. i have spoken to dozens of african leaders, for example, who say, my gosh, if india can do this, our problems seem manageable. all that is being tossed to the wind by a feckless and reckless government pursuing a narrowminded and bigoted agenda that does not have the support of the majority of the population, and that is why we are seeing these protests. this party has come to power with 37% of the vote in the present election and 31 and the last one. if you simply happen to emerge as the top dog of the pack in enough constituencies because the opposition splits the negative vote in different ways, .ou will get a good majority it does not mean that they represent the majority of the country. they represent a political majority in parliament, but not, in my view, as these protests confirm -- not in my view the majority sentiment of the country, which is very much for democracy, for diversity, and for coexistence. think that if the citizenship act did include muslims, it could help some of the citizenship problems, and i guess in your view as a lawmaker, what would you suggest as some of the ways to kind of curb illegal immigration? >> i already have suggested a simple resolution -- do what most democracies do and have a refugee and asylum law that gives people who claim to be in fear of persecution in their own countries a right to claim asylum in india. we have given asylum to large categories of people in the past. s fleeing chinese rule. individuals being persecuted by their governments, but we have done so at help without a law, without even having signed any of the international conventions on refugees. that would have been the humane thing to do and live up to the history of india where we have thousands of people fleeing to india. that would have been the right approach. this law, by confining itself to three countries and six named religious groups, is an assault on those very basic principles of decency and humanity but also a betrayal of india's largest -- of offering refuge to people. >> do you have confidence that the supreme court is impartial? it is going to hear something like 140 petitions challenging this. >> we can only hope that they will be. some of their recent decisions have raised the disquiet in some quarters. i would still like to believe the judiciary is the last holdout of an institution that ought to be impervious to the government's controlling and cuddling. i believe the supreme court will give a fair reading and in their view, this bill is unconstitutional, it gives the government a ladder to climb down from the hopeless position they have put the country in, and if the court believes it is constitutional, then heaven help us. india will no longer perhaps continue to be the india we have all loved and cherished for so long. rishaad: our thanks to you there . we did also reach out to the ruling bjp for comment. we have yet to hear back. taking a look at the market open, having a look at the session and what it promises. after two straight days of losses, we are looking at gains coming through. this is largely on account of some positive earnings coming through. of course, the nifty banking index essentially the one driving gains. we have consolidation in the indian ruby. disappointing earnings, which is why we are looking to drop it, but once again, there will be plenty to mark earnings. >> thanks so much. plenty more ahead. stay with us. this is bloomberg. ♪ juliet: microsoft's ceo was among business leaders at davos who are increasingly focused on climate. he spoke with bloomberg editor-in-chief john micklethwait. saying, whatwn to is microsoft's responsibility? we are increasingly becoming a big consumer of energy because of what we are doing with the cloud, and it was clear to us that given the signs that climate change requires immediate action, we wanted to start by saying that's make some good commitments, and the commitment means we will have to make sure that all of our operations are first consuming renewable energy, and then we take all the carbons we have put out and ensure that either through new technology or by natural means, we can take it out and become carbon neutral. we want to go back to all the rage of 1975 when we were founded and take on all the historical carbon as well. that is the other commitment. when it comes to this billion-dollar fund, we do need a real breakthrough. no one company is willing to do this, so we are very committed to putting our own balance sheet money on this and looking to see the ecosystem. >> you mentioned quickly the immigrant in america. microsoft is one of those companies who has pushed quite hard against this current flavor of immigrant bashing. >> i think first of all, america is a country of immigrants, a nation formed by immigrants. to me, when i look at the contributions that immigrants can make going forward, it is something i think the united states should absolutely be tapping into. that is what i speak to and that is what i think microsoft has benefited from it. i personally have benefited from it. why immigration continuing in the united states -- >> do you worry it is getting unenlightened? >> no, i think america is still the place people want to come to. about immigration policies that help, but i think they have to maintain that modicum of enlightenment and not think about it very narrowly, and i think that is what made it possible for those values that come.elped people it is not that people only will come when people know that you are an immigrant friendly country. >> do you think the number is going to continue to grow? the world's gdp is tax. that will double by 2030. if you think about being in the cloud business and especially being in the cloud business across all these leaders, means you get to participate in it. but what about the other 90% of gdp? to me, what is of deep interest is to see the broad sectorial activity grow, really shape up because of digital technology and the contributions we make. rishaad: a soft's chief executive with our bloomberg editor-in-chief. -- microsoft's chief executive with our bloomberg editor-in-chief. ♪ juliet: china is in the front line in the global battle against climate change, but can it be changing fast enough? that is the big question we are putting to our asia energy reporter who is with me here in singapore. you are looking at a couple of elements in key focus in terms of trying to go green here. is the world's coalst miner and burner of . china a couple of years ago started setting targets for itself to reduce its coal use as a share of its overall energy use, and it has actually been quite successful. if you look at the numbers, it is on target to meet its goal of hitting about 58% of its energy year. from coal this the problem is it is doing that while it's overall energy use still grows, so it is not actually burning a lot less coal than it was a few years ago. but looking around the beijing area, they have removed coal power plants, switched factories from coal to natural gas, and air quality has improved dramatically. now instead of a quarter to a third of the days being good, maybe half of them are, although they are still pretty dicey every once in a while. juliet: absolutely. we know air quality a pretty big situation there. intos it contribute helping air quality? >> china is the biggest investor in renewable energy over the last decade. has increased its share of torgy from about 7% to 8% about 15% in nuclear renewable, wind, solar, things like that. we are looking at even more increases to come, although perhaps the rate will slow down aim for cheaper coal with the trade war slowing their economy down. juliet: fascinating stuff. natural gas is obviously unfocused, too. >> natural gas has been the chief and a fishy area of their shift away from coal, and they have had some huge increases in consumption over the last two years. it has made them the biggest natural gas imported in the world, but they are starting to slow down on that as well as the economy becomes more of a concern. juliet: it's looking a little bit better than they were this time yesterday. rishaad: reassuring words coming from china during the last couple of hours about containing the coronavirus. some of the winners and losers -- there we go, we have some of these pharmaceutical companies amongst the biggest gainers on these markets. bloomberg "daybreak middle east" is next. ♪ taylor: i am in for emily chang and this is "bloomberg technology." a strong showing. netflix reports solid fourth quarter as it sees a 20% subscriber boost. but that kind of growth will fall short next quarter. we will look at every angle. the computer and i.t. giant eked out revenue growth thinks to its cloud. we will break down the numbers and discuss how the company is positioned for the rest of 2020. speaking of the cloud,