Fall on year and below analyst expectations. They confirmed plans to exit thermal. U. S. China relations sour even further. Jing says the tax lets take a look at how we are shaping up for this asian trading day. U. S. Futures within shouting distance when it comes to the regular session of that february record but then retreating by the close. We are seeing not much happening when it comes to active futures contracts. The nikkei 225 looking weaker going into the open. Chicago futures trading there. The topix in the meantime remains the bestperforming market in august. We will see if it continues those gains today. Ftse futures looking like we will open up higher by. 4 . The data calendar for the day, we get the rba august meeting minutes, looking into the details of their bond buying as well as the renewed assessment of how that new victorian lockdown will barter economy in those Monetary Policy settings. Also watching crude, we are seeing weakness, just holding over 42 a barrel although we did see a general rally happening before the opecplus meeting on tuesday. We are expecting the assessment manageddeal given they to revive some of the output that had been cut during the pandemic without sacrificing too much in terms of vices and broadly for commodities, we are seeing that rally alongside crude prices. Also adding. S. Additional restrictions on huawei and cutting its access to commercially available chips. It is the latest move in an increasingly tense relationship between washington and beijing. Andhen engle has the story joins us from hong kong. So what are the new curbs . Stephen the new curbs add to what the Trump Administration announced in may that a sickly, those export control measures prohibited foundries from making specially designed chips for huawei based on their design using American Equipment and almost all the foundries use American Equipment from the likes of Applied Materials and lam research, but these new restrictions coming from the Trump Administration add 38 huawei affiliates in 21 countries to an economic blacklist as the u. S. Tries to limit the adoption of huaweis 5g technology globally and analysts are saying the new restrictions are likely to further hit huaweis stations and smartphone businesses because it relies on those foreign ships to make those and the foreign foundries that use American Equipment as well. Huaweis stockpile of certain self designed chips essential to the telecoms industry and equipment will run out in early 2021, within the next few months so this is a critical blow. Wilbur ross says the new curbs that did come down from the Commerce Department are aimed at closing loopholes that huawei exploited or explored after previous u. S. Actions we saw in may. Donald trump did speak on this. Hes telling fox news we dont want huawei gear in the United States because they spy on us. , he pompeo in a tweet praised the move as a direct blow to the communist party of china, not just huawei. Haidi and in the meantime, we are seeing some interesting developments. Lobbyist in washington beefing up their ranks to try and take this battle over wechat further. Stephen absolutely. Those two executive orders donald trump put out on wechat and then as well on tiktok, there will be some fight back from the Chinese Companies, obviously, and tencent hiring its first d. C. Lobbyist, they have recruited roberto gonzalez, a former Treasury Department council, and obviously, they want to get into the halls of power and see what they can do to try and change some minds of lawmakers and see if this can be averted so there is a 45 day period that u. S. Businesses and consumers are given where they have to stop using wechat. North asiachief correspondent, stephen engle, with us. Still ahead, a management their cofounder and ceo joins us next. This is bloomberg. Karina you are watching daybreak asia. I am karina mitchell. House democrats plan to add 20 5 billion for the u. S. Postal service to legislation that for a vote on saturday. Bloomberg learned the measure would prohibit cutbacks ahead of the november election when millions of ballots are due to be mailed out. The move comes amid a wider stalemate in the stimulus measures and worries that voters may not receive ballots on time. The democrats are pioneering political conventions with an event to nominate joe biden and Kamala Harris that will be almost entirely virtual. Speakers will address delegates from around the u. S. With the whole event streamed on the internet and broadcast by traditional news outlets. Speakers include michelle obama, bernie sanders, and other democratic leaders. Belarus is sliding into chaos amid a growing National Strike and mass protests against alexander lukashenko. He is refusing to step down after claiming a landslide win in last weeks disputed election. He is offering constitutional reforms but observers say he may not retain credibility. He has been in power since the breakup of the soviet union three decades ago. Satellite Research Shows the accelerating melting of ice shelves in antarctica. The Study Suggests the continent has enough potential amount enougheltwater meltwater to fill the grand canyon. Trips toesearch antarctica this year have been canceled due to the coronavirus. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. I am karina mitchell. This is bloomberg. Haidi, over to you. With the recent rally in however,kets august may pose a challenge amid a resurgence of trade tensions, uncertainty about the new u. S. Stimulus bill. Our next guest is optimistic. The cofounder is and ceo of a management company. Great to have you with us. Of course, when we talk about emerging markets, they are not created equal at all. Which one do you like at the moment given we have had this pretty resilient recovery in china as a driver, stability when it comes to currencies and the weakness of the dollar playing in as well . Thank you. Right now, north asia is a market darling, and that is for two reasons. The most obvious of course is the superior handling of covid and consequently fewer shutdowns but the second reason is these countries have more fiscal room to absorb stimulus measures without blowing the budget or the currency or the credit rating, and that is a big advantage. [crosstalk] haidi sorry, continue. Teresa no, i was just going to add that we have also seen broader stock market performance. Korea, for example, if we look at recent stock market performance, the bestperforming midcaps caps and then and then last of all, the index in general. That is the opposite of the u. S. , which has had this narrow rally that has really been focused around the tech companies, so i think that really does reflect what is going on in the economy even though, as we know, the markets are quite decoupled from the economic picture these days. Shery it is interesting. We talk a lot about market breadth or the lack there of. When it comes to the u. S. , we are driven by growth and tech and we continue to wait for that andtion into cyclicals value. But do you see more breath when adth when itbre comes to these markets . Is that actually the case . It is very interesting. In the recovery from the fall in march, it has not been led by tsmc inin korea or taiwan. It is smaller cap stocks that are leading the way which i find very interesting. Part of that of course is that some of these smaller cap stocks are supporting the digitalization of the world economy. Course the biggest theme in the world. For us, we believe the new economy is the economy and a lot of these stocks, even though they are smaller in size are supporting digitization everywhere, whether for theom the support 5g base stations or to data centers or other parts of the infrastructure needed for a digitized world. Shery this gtv chart on the bloomberg showing how amazing the rally has been on the kospi. We have seen nine Straight Days of gains and we have halted a little bit on friday still in overbought territory. Does overbought mean that the rally has to stop or will it continue given the factors that you just mentioned . Teresa it is so hard to predict because this is such a liquidity driven market. We just had an announcement yesterday from the peoples bank of china that they are putting another 101 billion of liquidity into their market. Could there be some rotation from korea back to china . China is promising a flood of liquidity. That is certainly possible. I would say we are probably on this liquidity slip and slide for a while longer in all of the north asian markets. Shery what about the rest of asia . Southeast asia, for example. When you talk about these new economy stocks, tech stocks, it seems to be focused on those north asian markets, especially china. What about the rest of asia . Teresa you know, it is this is ag because in esg which specializes improvement stocks in the midcap state. We have been able to find digitized companies, ecommerce companies, platform companies, simtech companies, that are not mega caps in countries that are outside of north asia. Indonesia, russia, thailand, philippines, where they do not have the rate reserves of Venture Capital ready to put into companies to keep them private forever. So they have had to tap the Capital Markets a little earlier and that has given them a nice opportunity for us and i would say brazil is another country that comes to mind on that front. How do you trade volatility re the u. S. Election . Teresa [laughter] you know, we dont. We try to stick to our process. We know the fair value of all of try topanies and we stick with that. I would say from a Risk Management point of view, we do understand that a continued Trump Administration could lead to the delisting of Chinese Companies from the u. S. And even to increased pressure for certain Pension Funds not to invest at all in china. Unfriendlyery market type of policy but it has been signaled by the Current Trump so, we do try and to not put all of our eggs in one basket so we have eggs andide of the china sphere we also have some eggs in the recovery stock basket. Even while our stocks have done very well by being overweight the new economy in this recovery period, we do realize there will change of regime when covid is no longer such a big threat, so we are also being prepared for that. Do you treat hong kong as an extension in terms of risk asset the way that you would mainland chinese assets now . Teresa that is so interesting. We have a couple of hong kong companies, and both of them really cater mainly to the chinese domestic market. What i have to say, while i law inhe rule of hong kong, there are two things that irritate me about the way the Hong Kong Market is run and they could learn actually from shanghai and i am surprised to hear myself say that as a Corporate Governance advocate, arein mainland china, there dual class shares which are not allowed and they require quarterly reporting. Very irritating to us that hong kong is allowing dual class shares and also that theres only semi annual reporting, so the disclosure, that really means the disclosure is worse. I love the rule of law, but there are some things i have to give china, which has not covered itself in glory on Corporate Governance, little credit for. Shery good to have your views. Teresa barger, cofounder and ceo. In a moment, we will discuss westpac, and it scrapped its first half dividend to protect its balance sheet. Analysis, next. This is bloomberg. Haidi we are getting some breaking news. More bad news out of boeing. The plane maker said they are planning more job cuts. Boeing set to share details on august 24. The job cuts are said to extend beyond the initial 10 target that was sacked. The boeing ceo giving those comments in a message to internal employees that boeing is planning more dog cuts through a second voluntary severance. We have had since about may, 13,000 boeing workers, mostly in the u. S. , losing their jobs over a number of weeks. These cuts taking place not really just because of the pandemic which caused travel restrictions and the lack of demand for air travel but of course, all of these issues over the 737 max. It is still trying to get that back in the air and we heard that cancellations for the max have topped 400, shery. Shery we also have breaking news out of canada. The finance minister is resigning as canadas finance minister. He has been at the post since 2015. We heard he had been in disagreements with Justin Trudeau over ballooning deficits. He has disagreed over the huge amounts that canada was spending to combat the coronavirus, not to mention about some multidid billion dollar greek multibilliondollar green initiatives. He is now resigning from his post. Lets get a quick check of the latest business flash headlines. Teslas rally has driven the valuation above that of Procter Gamble as investors bet elon musk will be able to dominate the auto market of the future. The stock closed up 11 on a record despite reports of a fall in registration last month. Tesla is up more than 300 this year with a market value of more than 340 billion. Hasos chinese order reported a fall in profit as the coronavirus shutters plans and hammers demand. Net income through june cutting annual sales targets to 1. 3 million vehicles from 1. 4 million vehicles. The pandemic has exacerbated an Auto Industry slump that has been threatening on for two years. Bhp reported fullyear net profit just shy of eight billion u. S. Dollars, a 4 fall on year and below analyst expectations. The miner confirmed plans to offset coal. It was underpinned by high iron ore prices in june. The growth rate moderating over the longerterm sees exploration spending at about 7 billion. Witht miss our interview the bhp ceo later on Bloomberg Markets at 11 30 a. M. If you are watching in hong kong, and 1 30 in sydney. A look ats take another australian company. We will be watching westpac when shares start trading at the top of the next hour. Also increased provisions for bad loans. Our reporter joins us on the line now. Are all global banks at this point in time. We are talking about the same themes. What stood out to you in this Trading Update . Emily there are big things going on worldwide but what really stood out is the fact that they decided to completely scrap their dividend. They are the first to do so. Australia bank shows reduced dividends. We will get an update tomorrow on it. They were talking about this the whole world over. Shareholders have seen dividends rise in the past few decades so shareholders, this will be the moment when the crisis really comes home. Shery what are we expecting from the rest of the industry . Emily i think in a way, more of the same. As i mentioned, two of the other banks have paid dividends but everyone is clear that we are now into a much lower dividend outlook. The picture is complicated by the fact that so many people are on mortgage payment holiday. Come not really until they to the end which will be next year now that we are going to get a picture of how many people are really able to resume their repayments and how they will be forced into sales. That is when things will get much clearer for the whole industry. Emily,to what extent, are we seeing all of that being glossed over, at least, i guess papered over by the fact that we are seeing the enormous amount of fiscal from the government coming through the . Emily i think that is everyones concern. Theres so much stimulus in the economy at the moment was from the government and also from what banks are showing. They are doing everything they to keep businesses operating but in a way that is pushing problems further down the road. All of this comes back to the health expectations. Community transition was stopped and the economy bounces back, that is one story, but if things continue the way they are, clearly, glossing over things is not possible forever. See the big do you sources of stress . Is there any indication that this is an incredibly resilient Property Market we have seen across major cities . It is exciting to show pressure from the pandemic. Emily we are starting to see some signs of strain. That is partly for obvious reasons. The pandemic has stopped international migration, International Students who are more likely to live in apartments, so we are being big rental vacancies in the apartment market which hurts investors. In the more established home market, in many highend suburbs, the signs of stress are lower because theres so little stock in the market that we have not got a huge read of what is coming through, so you know, for now, the market is pricing in resilience. That is not to say prices are not down. You have not seen the clip the cliff edge like another times. Shery emily cadman joining us from sydney. We are hours away from the Democratic National convention. We have a preview, next. This is bloomberg. Karina you are watching daybreak asia. China is hitting back at President Trumps ban on tiktok in the United States, saying his demand that by dons the company must sell it is the rhetoric of robbers. The two signs are trading barbs as relations deteriorate with planned trade talks postponed indefinitely. New figures suggest u. S. Coronavirus infections are slowing despite cases approaching 5. 5 million. Arizona reported no new covid19 deaths while californias members were less than its 14 day average. The summer infection surge may be slowing down. Spain and italy france says virus indicators are trending up words. Singapore announced new virus stimulus worth 6 billion u. S. Dollars, extending aviation and hospitality. The program adds to the total pack