Services. Westpacs full year profits plunge after fines for Money Laundering. Cash earnings falls. One of those stocks where watching going into the sydney open. Lets look at the market open. Sophie . Expecting some moves this monday. The biggest weekly drop since september 25 as investors adjust the some of the risk ahead. We did have the worst week for aussie stocks since april. Adding 0. 1 . We have amp shares gaining trillionter the this wealth manager said that a preliminary takeover approach of every management values the company at 4. 5 billion. Westpac has results out this morning. Later this week we get results upm alibaba which ticked single day sales early on sunday. The ipo is a big event we are watching this week. We are expecting a big pop here on thursday given the massive appetite we have seen for the offering. Friday had the biggest drop since june. Of a private survey of chinese manufacturing data. To focus more on the u. N. , lets pull up on the chart on the terminal. A are seeing this jump to record on bloomberg data since 2011. Shery, more investors see gains ahead. Cibc forecasting it will reach 650 by 2021. Shery we are in the final stretch of the race for the white house which has been twists, the pandemic and the death of a Supreme Court justice. None of it seems to have altered a course set months ago. Joe biden continues to lead trump in the polls. Some races remain extremely close. That 90 Million People have already cast ballots. What do we know about not only the ballots cast but what the polls are showing this week . We have seen some polling on those early ballots. Polls showingve that joe biden has a big leak in those early ballots. People who say that they will vote on election day heavily favor trump. The moreathematics, people who vote early could throw the election to biden. Its very close in many states. Pennsylvania we have talked about numerous times. Many cases are within the margin of error. There can be errors. Everyone was taking they want to vote for. Capturing people who are on the mobile phone these days. There are so many uncertainties. We have seen a little bit of change in polls in states like iowa. We saw surprising polls showing President Trump whitehead way ahead. Some indications with states like georgia, north arelina, republican states close and could be pickups for t he democrats. There is a huge get out the vote effort underway. Trump has been barnstorming the country with rallies. Its very close and we dont know yet. Haidi were looking at the potential legal implications. Joe biden morning he would not let President Trump declare a victory before the results are clear. At what point are we seeing voter intimidation become an issue in these last few days . We have seen the Donald Trump Campaign put out calls for people to be poll watchers. Some people think it is an invitation to intimidate people going to the polls. That will be an issue. Were looking at various legal actions still rolling in from the Supreme Court on down about how mailin ballots will be treated. Cast andre the votes stamped and mailed in by election day, if they dont get there for a few days, will they be counted . Republican authorities have been trying to limit that. Democrats have been trying to get more people to vote. There have been decisions by the Supreme Court and others on both sides. When biden says he wont let trump declare victory, i dont think he has a lot of power to stop what trump says, but in terms of what will happen, i would hope that every vote is counted. We do have Vice President joe biden speaking at a rally. These are the final couple of days as candidates head to the Campaign Event they have in this final stretch. We heard the Vice President talk about 80 pro trump trucks around his home. Today we had some incidents related to his campaign. What do we know . On friday there was an incident in texas where the Biden Campaign bus, biden was not on the bus nor was kamala as harassed the bus w on the highway by people in pickup trucks with trump flags and trump stickers. There is an investigation going into that. This incident outside bidens home, a lot of people honking horns and creating a disturbance. It seems to be more obnoxious than anything else. Its an indication of how fraught a lot of the u. S. Is at th emoment. It seems juvenile to me. Toll see if it leads anything more threatening or damaging over the next couple of days. Washington editor there. We will get more on the u. S. Election. Siegemunds mobile advisors will be joining us in the next hour. We will also hear from the former white house secretary kim haugard. Karina we start with the pandemic. Rising coronavirus numbers are. Orcing more nations france, england germany and the the u. S. Reasing reported more than 78,000 cases over the weekend stop governments unveil new lockdown rules. The u. K. Will go back to its own lockdown. Now banned. Broad is economists expect the bank to cut the cash rate to 0. 1 of from 0. 2 5 while reiterating no tightening for three years. Haszealands Prime Minister earned a Cooperation Agreement. They secured a record landslide last month. She says the deal signed does not require consensus on policy or even alignment. Global news, 24 hours a day, on bloomberg and at quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. Haidi this trillion lender westpac which came out with grim results the australian lender westpac which came out with grim results. We are seeing the bounceback when it comes to the today. They said that they expect improvement when it comes to the more reachable performance going into 2021. Still reporting that four year profit plunging with the breach of antiMoney Laundering laws and the coronavirus lockdowninduced recession. That is causing concerns when it comes to bad debt charges. We are seeing a bit of a relief rally. We have been hitting the oil markets. The lowest level since may. We already have data that they added rigs for the sixth straight week of weekly gains. Coming up next, a big week on neweconomic front after data suggest that chinaesque of a recovery is largely on track chinas recovery is largely on track. This is bloomberg. Shery new data from china suggesting the economic recovery remains on track. Services seeing a boost from spending through golden week. We get the pmi rating coming in later. The start of a week that includes policy decisions from us really and malaysia. Richard, if we want the good news, and the news of a solid recovery, what can happen when the virus gets under control . We continue to look at china with these comforting economic readings. I agree that it is not just china. Much of the current time zone of the asian region has managed covid well. They used lockdowns in the right way to deal with the virus properly. Track and trace has been an important part of the arsenal. What china is doing is you can have a recovery in the , but policymakers have a bit of time when it comes to structural issues and they are not destroying to put out spot fires around covid or in europe. Throat thist to chart looking at new orders and new export orders. These readings are crucial for some of the exporting countries. It is pretty encouraging that you see new orders bouncing back and inventories of Raw Materials starting to draw down a bit. Is this a reverse situation of when china countries like australia will continue to ride on the coattails . I think so, but australia and other parts of asia have their domestic houses in order. One of the errors that people have made is to presume that the recovery and the goods parts of our economies can only go back. O where it was prepandemic aboveod sectors are well precovid levels. Trade is well above what we saw precovid. Part of the economic story in australia, the rba decision this week, the expectation seems to be for a cut. Will it be eclipsed by what is happening in the u. S. . I think that the rba has a chance to in effect recalibrate. The reality is they are in a globalized world. That puts pressure on the currency and they probably need to that. I agree with the consensus, the bank will do something tomorrow. The intention will be to signal immaterial extension. Decision isks outoftheway it allows guys to turn to the u. S. Haidi fair to assume we will see losses for the aussie dollar . Some people are nervous. The blue wave idea had some currency and some of that got baked into the aussie dollar and people have become more nervous. It seems to me that a blue wave is likely. That people are misinterpreting a slight narrowing in the polls. Seeingl results we are are only relevant for a smaller portion of the electorate. Its harder to see such an extreme tightening but that is all undone. I think that the inflationary expectations of what a Biden Victory would look like, and what a Trump Victory might look like given the expectation of more stimulus either way. Be expect that differential in an unexpected way . The inflation story is quite hard. There are a range of views out there. Inflation is going to pick up a lot. The inflation dynamic looks quite different from what we saw after the financial crisis. This time Inflationary Pressure came and went in a number of months. There is quite a different environment and fiscal stimulus im not expecting a big move in inflation. Shery we have age restrictions in melbourne and no doubt we will get news on the reopening of borders. The domestic story has been key for any of these companies seeing a robust recovery. Is beingof that sustained by the fiscal cliff being pushed back . We know that the labor market continues to be fragile and some of these businesses might never come back. The fiscal stimulus is hugely important. The policy response has been unprecedented. There has been a little bit of a surprise in australia. Retail spending does not seem to have slowed in any cheerio way. There is more of the cliff to come, but i am encouraged so far that the government has got the calibration roughly right. Shery always great having your thoughts. We will have more perspective on chinas economy ahead. S spokesman joins us later. Here is how westpac is trading at the moment. At the start of trade we are seeing losses of 0. 4 . That is next. This is bloomberg. This is bloomberg. Haidi a busy morning first trillion finance folks. For australian finance folks. The wealth manager revealing the value of the takeover offer revealed by the private equity firm. Lets get more on these stories. Ed johnson. As expected and ugly earnings season. Interestingly we saw the stocks jumping up to five straight sessions of losses. Is there a sense that as ugly as these were, the worst is behind them . Yes. The shares did rise this morning, despite yet more bad sector. The banking they are only at 0. 2 now and west Bank Reported the cash that is in line with analyst estimates. The cost is compensating wrongly treated customers with bad debt provisions increasing 3. 2 billion australian dollars, just that thendication recession smashing consumers and businesses. Final dividends having previously scrapped their payout anzreserve capital from the ink posting a 42 decline fullyear profit. T they are shery the a p jumping this morning given the proposal. The us wealth manager revealed what we have all been waiting to hear. The value of the offer. 6. 4 billion australian dollars. That is a sizable premium. 44 higher than where a p was trading on thursday before the approach was disclosed. The shares rocketed 20 on friday. They are up about another 8 this morning. Be waiting to see if a bidding war emerges. Here is a quick check of the latest business flash headlines. The cabledeal to buy billion. Pg for 2. 8 internet broadband producers have done well during the pandemic as more people stay at home. As u. S. Consumers shed traditional tv for highspeed internet. The chinese developer ever grant is selling a 41 stake for more than 2 billion in cash. The group will become the second biggest shareholder after the deal. Its an Investment Holding firm which states in Automotive Energy and logistics. January could cause a severe cash crunch. Has wasted no time in expanding the footprint in the middle east. He signed on ml you to open a Wealth Management business in qatar. Hammers became ceo after nearly seven years at the helm of the dutch bank ing. Upsucceeds Sergio Armani as looks to cut costs. Maps the 2020 election and what it means for financial policy. This is bloomberg. Hope it doesnt cost too much. I hope my insurance pays for it. Can you tell me how much this will be . [cashier] 67. Sorry. Wait, have you heard about goodrx . Goodrx finds free coupons to help you save up to 80 on your prescriptions. Wow, i had no idea. [announcer] goodrx, stop paying too much for your prescriptions. Karina this is daybreak asia. Factory gate performance fell slightly last month. It generally stabilize with Consumer Spending helping to lift services and showing the recovery remains on track. The manufacturing pmi index eased. Personal consumption ticked up slightly. The performance was likely affected by the golden week shut down. Seven prodemocracy lawmakers have been arrested in hong kong for their involvement in scuffles at alleged comedian may. Alleged in may. A Court Hearing expected for thursday. Chinese state media say further arrests cannot be ruled out. And criminal investigators will question in beirut next year in an inquiry. French authorities are looking into his dealings with the car distributor in omaha. Tf1 he has nos need to avoid questions and has a clear conscience. Thailand has made a rare appearance on the streets of bangkok calling the country a land of compromise. Protests continue against the monarchys powers. He and his wife greeted loyal supporters. He told the u. K. s channel four news that he loves all thais equally. Dead aftereported the philippines were hit by the strongest storm in the world this year. It forced the evacuation of hundreds of thousands. The airport close down for 24 hours but is expected to reopen. It is strengthening as it heads for vietnam. 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. Early voting has continued to show record turnout. 93 million voters have cast early ballots. That is more than two thirds of the total votes cast in the 2016 election. Meyer,ring in charles chairman and founder of sigmund global advisors. He has also advised the Biden Campaign on economic matters. It is great to have you with us. You say that you are confident in your base Case Scenario of a biden win. What gives you that confidence . In theuple of trends early voting that are interesting to us. The hsheer Record Number of people who have voted early both mailin and inperson have surpassed expectations. We think that there will be higher than expected record turnout from democrats and independents which favors joe biden. A couple other things, people like to focus, and the media is focusing on the number of democrats and republicans who have turned out. In personosen voting, republicans have a slight edge. But if you add the democratic mailin and independent voters who are looking at 70 of early voting which favors biden. Two quick trends that we are watching is the large increase in turnout from younger voters. In texas it has been three times what it was in 2016. Secondly, very high turnout from women. Turnedgia, women have out by a margin of 12 points over men. Young voters, women voting and a large number of overall democrats and independents reinforce our base case. We think democrats will take the senate. Some think we will see the enthusiasm of 2008. Tell us what a blue wave across congress will mean . What we keep hearing is that President Biden would increase taxes. What sort of taxes are we talking about. The question we always get asked by our clients is what the market do if the client wins. How will the Financial Markets perform . I would argue that stockmarkets do well when democrats are in the white house. I dont see any difference there. The one thing we are highlighting is being underpriced or underappreciated. The extent by which corporate and personal tax will go up next year. There is a strong narrative that because biden will inherit a weak economy, he may be inclined to go slower and phase them in by 2022. We think that biden and his team are very serious about raising the corporate and personal tax next year and making them retroactive to january 2021. The average hit for s p 500 companies is around 12 . Most people believe that this will happen in 2022. Most have not yet factored in these potential tax increases into their models. Underpriced risk at the moment. Haidi i want to throw up this chart for urinalysis. Your of chart for analysis. 2016 it seems like a similar chart. Do you look at that and a part of you is concerned that we will not get a blue sweep but a red wave about these potential silent majority supporters for President Trump . And even about voter intimidation on election day . The concern is that given up almost every buddy got 2016 wrong, they may be wrong again, but there are some big differences. Biden has maintained a consistent seven to 10 point lead over trump. Four years ago, hilary only had a two to three point lead. Within the swing states, biden has had a larger lead in the swing states of wisconsin, pennsylvania and michigan. There are big differences in terms of how much further ahead biden is. The other big difference today is that only about 4 of voters were undecided going into the election. Combined with the fact that 93 million americans have voted means that once they have made up their minds, we are seeing President Trumps poll numbers improve. Most people made up their minds have alreadyn voted. Shery you talk about the restoration of american institutions and its national institutions. If biden wins, with or without the senate, in terms of Foreign Policy and the role of america abroad and the standing abroad is one of bidens biggest issues in terms of what he wants to focus on. You will see an executive order from President Biden to keep the u. S. In the paris accrod. You will see the relationship with the eu improve and will work with them on a variety of important issues. Canada andh e. U. In mexico. Stronger, vocal support. Taking leadership with multilaterals. Putting the u. S. Back into the who. Stronger support for nato, world bank, imf, etc. Expect the United States to step back into that leadership role. Victorys a biden without the senate a possibility that are not priced in at the moment . We have an 80 of ability that biden wins on tuesday and only 60 that the senate flips democratically. In washington when you have a divided government, it is positive. It means that anything that is too transformational cannot get through. Today, divided government would be bad. What biden will need to do is to get an emergency stimulus bill through in late january of 2 trillion or more. A divided government with the republicans controlling the senate, that would be difficult to do. Will present his tax increase plan. If he doesnt have the senate, that is irrelevant. He wants to do 2. 5 trillion of infrastructure with the country needs and that will be challenging. By july, the u. S. Has to raise the debt ceiling which is a vote in both chambers of congress of commerce. A Republican Senate might try to hold the Biden Administration hostage and try to extract other priorities or other objectives in exchange for lifting the debt ceiling. We could be back to 2011 when we were peering over the fiscal cliff. In this instance, i dont think it is positive for markets. Haidi we appreciate your time, charles myers. We get to these final couple of days before the key vote. We will have more analysis on the u. S. Election. The nonresident fellow in the former White House Assistant press secretary guard will be joining us later kim h ogaard will be joining us later. Passing through those earnings reports. This is bloomberg. Shery state owned banks are plagued with a surge of bad loans. True profit declines in the Third Quarter. David engel is taking a closer look at the Banking Sector and joins us from hong kong. Stephen, this is not a new story when it comes to china banks. You have to wonder whether the pandemic has brought these chickens to roost. Stephen they are seeing their worst quarter in more than a decade and a half. China and listed these state china enlisted these state banks. They were asked to sacrifice profits. The first half of the year was a write off. They had to rollover a lot of bad debt. The Second Quarter was terrible. Net income in the Third Quarter 5 ated slide less than all the big four. That was compared to an average slump of net income of 25 in the Second Quarter. Side, muchincome better position. You have to pay the piper on those policy moves and the nonperforming loans climbed to a record high. 979 billion yuan in the Third Quarter. China allowing many borrowers to delay principal payments until march 2021, a payment holiday. What will happen after that . A return of more nonperforming loans that are hidden now. Shery we continue to see the economic recovery take hold. We know that banks have taken the bigger part of the burden, but now that we are seeing a recovery, are we expecting better news . Much depends on the depth on the breath of the recovery, that it did expand 4. 9 . Growth is uneven. Global demand is uncertain. Are conclusive. As i said, nonperforming loans may soar as we go beyond the First Quarter of 2021 as that payment holiday expires in march. The four biggest banks may report an 8 decline in 2020. Much of the outlook for the banks really hinges on how deep and bad are these nonperforming loans Going Forward into the second and Third Quarter of next year. Shery Stephen Engle there. One Investment Firm that is heavily invested in china is kkr. The cofounder exclusively told bloomberg that no matter what happens, china will be a focus for the firm. We are focused on china relations. China is an important part. You cant ignore china. China is not going away to by any stretch of the imagination. It will be there. It will be an important part of our focus, and it is also an important place where we continue to invest. Have been investing there for 12 or 13 years now and we will continue to do that. Maybe we have more issues at home then we have around the world. You have to be aware of it. World doesnt work that way. We dont look at it that way either. Theant to know, what are disruptors . It can be a disruptor of technology or because of a geopolitical issue and that is what we are looking at. How do we take advantage of it . What can we do to invest into that . Aware of theenly political issues at home. How do you prepare for an election like this which feel so momentous, both personally, but youre a longterm investor. You have to think about your customers, the companies that you invest in. How do you pull the Team Together to map out scenarios . We do that. Call them war games. Whatever you want. You have to put the simulations together. Thats important whenever you are thinking about investing, particularly when investing around the world. Weve been in business for 44 years as kkr. George and i have been investing for over 50 years in private equity. If you think about the different cycles that we have seen, high Interest Rates off the charts, back in 19781979. Weve seen deflation, weve seen the Global Financial crisis in 20082009. In this particular downturn, what i will say about kkr is that we were prepared for something to happen. We didnt know what it was going to be. Covid hit int when the u. S. , we had gone 125 months of uninterrupted gdp growth. 1 longest period since900 the longest period since 1900. Trees dont grow this long. We missed in part on the Global Financial crisis. We got some of it right but not as much as we had hoped. We said, lets not miss the next one. Swandnt see the black that turned out to be covid. We were prepared. We were ready to take advantage. Youre right, were a longterm investor. Whether Vice President biden is the president or President Trump is reelected, were taking a po sition that weve been through a lot. Well find opportunities. We have to make sure that our companies are wellpositioned for whatever may be coming down the road and then, batten down the hatch. Shery that was kkr host cofounder henry kravis. Dont forget, our interactive tv function tv. You can watch it live and catch up on past interviews and dive into any of the securities are bloomberg functions that we talk about. This is for bloomberg subscribers only. Check it out. If you are away from the screen, you can always find indepth analysis and the big newspapers newsmakers on bloomberg radio, broadcasting live from our studio in hong kong, listening via the app bloomberg plus, or bloomberg radio. Com. Stay with us. Haidi a quick check on the latest flash headlines. A preliminary taker of the American Private equity firm billion. Ed at 4. 5 the 171yearold firm has said it put itself up for sale after a Sexual Harassment case led to a board room shakeup. That caused amp to lose three quarters of its value. Westpac eskimo value plunged on the back of Money Laundering valuenes westpacs plunged on the back of Money Laundering headlines. Debt provisions rose to more than 3 billion as covid19 continues to hammer businesses. The latest figures from new zealand showing passages up from september down even though the virus seems to be under control. Domestic passengers have been returning but numbers are still down 40 on year. Just 27,000 passengers for the year. Showing signs of recovery. Revenue fell only 17 from a year earlier but it is a sign that china ask about relaxation of travel curbs is seeing returns. Sales during the golden week were down 84 on the last year. Dollarusd falling below 70 u. S. Cents since july. We had the plunge when it comes to oil futures this morning as well as the expectation from the reserve bank of australia. Policymakers meet on tuesday they are expected to cut interest slates Interest Rates and to reduce that target as they try to turbocharge the domestic economy. The most serious lockdowns coming from the state of victoria which is a quarter of gdp up for australia. We are seeing that downside when it comes to the aussie dollar. We are seeing what is expected to be a prevolatile week. Shery you mentioned oil prices plunging. Do have wti at the lowest level since may and you have the Energy Sector on the asx 200 leading the declines. We are also gearing. Expected to cut rates but as you said so much more to watch today including the u. S. Election. Theks losing rounds for fourth consecutive session. We have a little bit of strength for the japanese yen. The worst everff loss in the u. S. Market leading to a president ial election ever. Nikkei futures up at the moment. Past 5. 5i lost for the five sessions is at the lowest level since august. Futures under pressure after falling the most in a month. All of this uncertainty of what is happening this week really felt in the markets. Banks look ahead output. Ata oufactory is the official data reliable . And our next guest tells us why the his top three equity markets are china, japan, and south korea. This is bloomberg. Asia. Welcome to daybreak im shery ahn. Major markets just open for trade asian markets aiming to rebound as traders break for the u. S. Election. Oil slumps as President Trump and joe biden make the way for spring swing states. Giant cargile is seeing bond purchases rise under the phase i trade deal. We hear from the chairman and ceo. [crosstalk] have the u. S. Election upon us, plenty of risk events this week, the earnings calendar jampacked and a listing on thursday in japan, tokyo trading kicking off for the start of november trade, stocks gaining out about. 6 . We have extra spending stimulus detail very much in focus from japan. Lets check on the open in south korea green on the screen at the start of trade. Sevenbarely eking out a monthly gain. Export data out at the weekend showing that continuing momentum for shipments but europes lockdowns are adding to uncertainty around demand. Flipping the board, we see that fuel some downside for oil a steep drop for wti and brent. Extending losses after the worst month since march for new york crude. Commodity forex, taking a hit falling below 70 for the First Time Since july with rba easing bets weighing on the currency. We see stocks fluctuate this morning after the worst week since april for the asx 200 and whitby u. S. Elections very much in focus, moving to the downside in the asia session while the dollar is looking steady. Earlier on the show, david blum says he expects the greenback gains to reverse in a massive relief rally but hes not giving up on the greenback just yet, noting it does not matter for markets and is saying by growth. Haidi the election just a day away, wall street warming to the idea that a biden presidency would be bullish for stocks. Lets bring in the joint head of aipac equity research, jim mccafferty. Im not sure i buy into that because i feel like theres a sense that regardless of who wins this week, if we get a result, massive stimulus is on the way anyway. Theres probably a question over theher bond buying out of fed and what Inflation Expectations would be. Week as volatile as the one we are starting to go into, what should investors be fearing most . Jim i think another Trump Presidency would mean further geopolitical tension for the next four to five years, and that means its very difficult for economies and investors to plan. Outcomerobably a worse from a geopolitical point of view. The domestic stock market its probably quite good because it means more tax cuts potentially and a business friendly environment. Ultimately if you take the fiveyear view, a resumption toward more of a normal world and towards in terms of diplomatic relations is a better outcome. We have not seen your usual havens move that much. When you take a look at the scope of fx, is the recovery of china, what that means for emerging markets, maybe even the successful recovery stories in north asia proving to be Better Destinations for haven buyers at this point . Jim we think so. If we go out to 2021, if you look at what is happening in asia over the course of the last few months, we see the coronavirus appears to be under control. Generallycieties deferent to government decisions and if you contrast that to what is happening in the west, specifically europe and the u. S. , we are seeing society begin to potentially rake down. We are seeing civil unrest in places like france, for example. We are seeing protests and other geographies and investors, when they look holistic lee, you look at asia today compared to asia 25 years ago when we had the Asian Financial crisis, countries in north asia, china, korea, japan, taiwan, they have strong country vat country Balance Sheets and dont need other countries to bail them out. Around, as investors look at the Global Equity landscape, our thinking is money should go to asia. Its a safer place for many to be. Haidi what sectors in asia would you go to . Weve been talking about the consumer side of things in china and we have single day coming up as well. Jim the interesting thing is if you look at asia, there is a real tech sector. If you look at the u. S. , the market is bifurcated. You have these five big stocks but we have similar stocks in asia and whats interesting is we have alibaba having results has an asiad asia version of what the u. S. Has. Europe positions itself for growth equities, there are some decent durable stocks but they are expensive and the growth is more pedestrian. If you are looking for growth at a reasonable price, we think asia is a good place to be. Led by china but also haidi japan and taiwan. How much does it help, and specially in china, when you have the focus of becoming a technological powerhouse . We saw that reflected on its fiveyear plan. Helps a greatt deal and the fact we have Central Planning and china means Foreign Investors know the political scene has complete certainty. A 10, 15, 20 year view, you can invest knowing the same type of Economic Policy will be in place for a long time and that gives people a lot of certainty. Traditionally, north asia has been quite exposed to north america. Japan, quite a lot of exposure to the u. S. Stop Chinese Companies are quite insulated. China has got its own path set out and will do very little to deviate from that path. Haidi lets talk about those taiwan, noties like only to north america but europe you have surging coronavirus cases and economies weakening, how will these economies survive or grow further without the help of the west . Think we will rely on help from china and also help from themselves. To 1997ea and go back and korea was in a tough position and needed to borrow externally to fund itself. But after 20 years of being exposed to mobile markets and a weakening currency, korea has done a lot to preserve capital from a government perspective and a company perspective. The companies dont need to borrow money, they dont need to go to the credit market. Inhink the stocks are incredibly strong state but from a government perspective, the korean government will put together a fairly sizable fiscal monetary package to get this country on its feet again and thats what we are seeing in other geographies stop haidi always great having your thoughts. Lets turn to Karina Mitchell for the first word headlines. Karina rising coronavirus numbers are forcing more nations into National Lockdown sent tighter restrictions. France, germany, and u. K. Are increasing controls and belgium is set to follow. Switzerland is putting geneva into partial lockdown. Newhe u. S. , or than 78,000 cases were reported over the weekend after two Straight Days of national records. Meanwhile, anger is rising across europe as governments impose new lockdown rules will stop protests erected in madrid and other spanish cities after officials blocked travel from local regions, but there still no National Lockdown. U. K. Will go into lockdown later this week again while extending support for furloughed workers and offering a mortgage holiday. All travel abroad is now banned. Seven prodemocracy lawmakers have been arrested in hong kong over their involvement over scuffles at an electoral meeting in may. They are accused of violating powers and privileges and are expected to be released on bail with a Court Hearing scheduled for thursday. Chinese state media says further arrests cannot be ruled out. Criminal investigators will question him in beirut next year in an inquiry into expenses of a dutch subsidiary. French authorities are looking into his personal spending and payments made to consultants. He told frances pf one he had no need to avoid questions and continues to have a clear conscious. Clear conscience. 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. Im Karina Mitchell. This is bloomberg. We do have some breaking news when it comes to the shape up of the new zealand cabinet. The Prime Minister naming the deputy Prime Minister, a move that was largely expected as we the party waswhen not return to parliament after the landslide election. Saying Grant Robertson will continue as finance minister as well as she continues to shape her new cabinet. We are waiting to hear who will be leading the covid19 health care portfolio. They are saying those are the Priorities Health care and the economic recovery. Grant robertson expected to take on the new role as the Prime Minister. Still ahead, we will be discussing the latest pmi data out of china as well as the new fiveyear plan. Next, the president ial race entering the final stretch. Joe biden seemingly maintaining a narrow lead in the latest polls. We have the latest just ahead. This is bloomberg. Haidi none of it seems to set altered the course months ago. Joe biden continues to lead though some state races remain close. Jolie snyder is on the line. We have more than 90 Million People already voting here in the u. S. What are the polls in the early voting telling us about what will happen this week . Been an unprecedented number of people voting early, including by mail. So the shape of the election is somewhat different this time because of the mailin voting, but we are still seeing joe biden lead President Donald Trump in a series of polls released over the weekend and is remaining ahead nationally and in battleground states. We saw a New York Times poll showing joe biden ahead in pennsylvania, arizona, and wisconsin, all key swing states and all donald trump carried in 2016 and will need to carry some to get to that Electoral College victory but it is very close in a few of the states. When you look at the polling situation, it is eerily similar to what we saw four years ago. Does he still have this path to victory . What would that look like . Need to win some of those key swing states. It will not be enough for him to win in the states where hes favored to win. National polls do not indicate a winter since president s are chosen by state but they can suggests trends. The trend suggested here is there is a path where the president but he would have to take florida, for instance, where he is narrowly ahead in a Washington Post poll. Biden wellll had joe ahead in pennsylvania, which is another state President Trump could take to try to get to that path. Statesthose swing narrowly, a state like michigan, abouthe won narrowly by 10,000 votes last time. He was there three times over the weekend trying to get those votes. It is a narrow path to victory and things would have to swing in his favor, much like they did last year, four years ago, but it is a very narrow path at this point according to the polling and what pollsters assume is the shape of that unprecedented early voting. We will have more election analysis just ahead with the former white house secretary. American food giant cargile is hoping there will be progress on the trade front. They have seen a boost in chinese purchases under the phase i trade deal, providing a strong market for American Farmers. Still, the chairman and ceo says most has been driven by pure theomics and demand amid pandemic. Asia is still strong and china is business as normal and the risk spots are relative to shutdowns, clearly are in north america, the u. S. Specifically and western europe and we have a large presence in both. But im optimistic in both geographies and optimistic based on what we went through in the spring and what we learned, that we will keep Food Supply Chains running. The system is very resilient. The people that work in the Food Supply Chain are very, very resilient. What impact will the closure of hospitality have . We are already seeing it in europe and chicago. The expectation is that may spread out across the United States. Dave you could speculate hospitality shutdowns and people traveling less will have that impact and that is no surprise. The travel and Entertainment Industry certainly has suffered the most and with people being more cautious and more conservative, that is likely to continue. Then extend that into food service, the restaurants, particular the quick serve restaurants able to adapt the way they deliver their food and to curbside or whatever it may be, they are going to continue to be strong. Certainly the hospitality industries, travel and highend dining have greater risk than do the other components. Give me a sense of whats happening on the ground in china. Purchases have been huge and i wonder how much is a real demand tochina, or china needing fill obligations from the u. S. Or how much is that you have weaker supply and issues in brazil, where china had to buy from the u. S. Give me some insight into the thinking there. Dave its an interesting question and most of it is demanddriven. You have had the reduction in african swine, so that has brought demand back and the chinese economy, the chinese population is pretty much life and business as usual. I got a picture sent to us by our chinese colleagues in a Conference Room and i stared at the picture because there were 10 people sitting at a conference table and nobody was wearing masks. It reminded me of the old days from eight or nine months ago in the u. S. But they are business as usual and it is demand driven. Commodityhtened up markets and driven up prices, so that is what we are seeing in our chinese business. Crop commissions, harvest has been good, so the good news is it has provided a market for American Farmers to supply corn and soybeans to china. Do you think the Trump Administration has made those farmers more dependent on china . If it was to be a biden win next the, which china changed relationship, honor that phase one deal . The politics are going to be very tempestuous over the next few days and im curious to see how you are viewing that. Far there are people smarter than i am that can analyze the impact of the political situation in the u. S. And postelection. The fact is china has been implementing and purchasing under the phase one agreement, but as i just mentioned, most of the activity is driven, pure economic demanddriven. The American Farmer just wants open markets. Standpoint, we are hopeful in either situation, and either result of next weeks election that free trade, open borders continued to be a principal because that benefits the american agricultural economy, specifically the American Farmer. That is what our hope is that whoever wins we continue to have free and open trade. Dave maclennan speaking to alix steel and guy johnson. Numbing up next, we will take a look at oils slippery slide as wti falls below 35 a barrel. This is bloomberg. Haidi we see oil futures extending declines, ending on tober with the biggest monthly fall since march. Su keenan is watching it. We saw the drop at the open of trading. Is this related to the spike in covid cases or is this more related in terms of the volatility regarding election week . Su it looks like both are having a very big role. Some that believe a joe Biden Victory, we will know in about 48 hours, could hurt the oil industry because he is focused on the environment. Look at the fiveday chart and on the largest losing streak since september rate. Futures fell below 35. Startpped 6 right at the of asian electronic trading, stabilizing in the later hours but if you look at the big picture, in tober, west texas intermediate had its biggest drop since the beginning of the pandemic. As the recent slide in prices cutthe gains we saw to be in half. The spike in covid 19 cases meanwhile in the u. S. , on trading floors at the New York Stock Exchange to private houses like j. P. Morgan chase or goldman, masks are the standard. Those concerns have as much to do with europe as the spike in cases in the u. S. It gives a huge challenge to the already challenged rebound in oil demand. Drop in hedgeharp funds stop the bears are in control and the coming week is potentially pivotal. Not only election on tuesday but fed policy meeting on wednesday and traders looking ahead to the late november meeting for opec plus. Shery no wonder we are seeing so much volatility and we see it in brent crude. In libyais the boost playing a role . Withibya has a lot to do this kicking off the way it has. Take a look at rent crude. It dropped 10 last week alone. Many oil traders are saying brent crude is now oversold. The volatility likely to continue. And we look at how the independent Oil Producers are going to be needing to talk about what they are going to do about out but. Libya is front and center because their output is surging. Theyve gone from what had been about 100 thousand barrel output to 800,000 barrels. They are on their way to a million and that has a lot of opec watchers and oil industry veterans concerned. Of course, there will be a meeting later in the month on what opecplus is going to do about a planned easing of the curve. Its likely they will have to delay their meeting because of the deterioration oil prices, but the direction question for oil is very much front and center in this actionpacked week. Back to you. Shery lets take a look at one of the movers in the sydney session amp seeing a relief rally, up after saying the takeover approach from aries values them at 4. 5 billion. Are you frustrated with your weight and health . Its time for aerotrainer, a more effective total body fitness solution. announcer aerotrainers ergodynamic design and four patented air chambers create maximum muscle activation for better results in less time, all while maintaining safe, correct form and allows for over 20 exercises. Do the aerotrainer super crunch. The prestretch works your abs even harder, engaging the entire core. Then its the back extension, super rock, and lower back traction stretch to take the pressure off your spine and stretch muscles. Planks are the ultimate total body exercise. Build your upper body with pushups. Work your lower body with the aerosquat. The aerotrainer is tested to support over 500 pounds. It inflates and deflates in less than 30 seconds using the electric pump. Head to aerotrainer. Com now. Now its your turn to lose weight, look great, and be healthy. Get off the floor and get on the aerotrainer. Go to aerotrainer. Com, thats aerotrainer. Com. Karina at this is daybreak asia. The u. S. Election heads into its final lap with the two candidates in as the polls imply a close finish. The campaign has featured drama, hospitalized president and a change of the Supreme Court stop it survey suggests many voters have already made their minds up. Pollsters say averages have better have barely move. Final results may not be known for several days or even weeks. In other news, the new zealand Prime Minister has signed a Cooperation Agreement with agreements for a second term. They secured a record landslide but wants Additional Support in parliament. She says the deal with the continues the consensus policy and continues the general relationship they formed in their first term. Grant robertson has been named deputy pm in the new government. The king of thailand made a rare appearance on the streets of bangkok, calling the country land of compromise as protests continue against the monarchys powers. He and his wife treated supporters after weeks of demonstrations sent the thai stock market to new lows. The king told channel four news that he loves all ties equally. And the rba is expected to cut rates to a record low and unleash further stimulus to boost an economy reeling from the virus lockdown. Economists expect the bank cut the cash rate to. 1 from. 25 percent while reiterating no tightening for three years. They also see more buying of long dated government bonds to put pressure on the aussie dollar. At least seven people are reported dead after the philippines was hit by the strongest storm in the world this year. The typhoon left much of luzon without power and forced the evacuation of hundreds of thousands of people. The airport was closed down for 24 hours but expects to reopen monday. The storm is crossing the South China Sea and strengthening as it heads for vietnam. 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. Im Karina Mitchell. This is bloomberg. With the latest manufacturing data across asia, lets take a look at how the nascent recovery in asia is shaping up. This is what we are seeing when it comes to the october readings a little bit of an improvement when it comes to vietnam. Indonesia still in contraction territory. An improvement when it comes to south korea one of the Success Stories when it comes to post covid management. s factoryk at japan outlook for september. Theng a look at manufacturing, still in contraction territory but a little bit of a picture of improvement continuing to play out. Kathleen hays joins us now. Were outt numbers that over the weekend, what kind of picture is that painting . Below 50 49mi was months, so it is finally poking its head above that level. Weve got several of these pmis and i would say overall, the manufacturing picture has improved a bit in asia because we have korea back above 50, taiwan solidly above for the second month and a row. Got vietnam still above 50, overall, some improvement but it cant be hurt by the fact that china recovery continues 54 they are staying above manufacturing. Lets focus on korea because we know they are the bellwether exporter for the region and the numbers we got over the weekend, on the surface, they did not look so good because exports went down yearoveryear in october. But bring down the chart and im going to tell you a story about this. Fewer businesses. Thats why exports yearoveryear were down after being up 7. 7 . There has been a lot more red bars and not just because of the pandemic. This has been going on for a while. 5. 6 . Ily average up many economists say with chinas economy looking better, those numbers could improve for korea. They are making some improvement, back up to about 48. Japans estimate keyed this already because it showed chart, up stuff another japan has had three quarters of negative growth. Is industrialee production up and what pushes it for japan is demand for exports. There exports are still negative, but they are pretty quickly getting less negative. You have to conclude thats a positive sign and japan, 19 of its exports go to china. Just had a guest talking about demand looking better, not just driven by other factors. The u. S. Is a mixed bag right now, however there is some recovery going on in the u. S. , so perhaps those numbers bode well for japan. I would say across the board, things are moving in the right direction. They are well off the lows we saw in april. Mentioned,athleen weve seen the continued economic recovery and we are expecting those factory numbers. Weve seen the official manufacturing numbers in expansionary territory. Lets discuss with iris paying iris pang. We have seen the numbers in expansionary territory. This chart showing how Business Activity expectations have 60. Ed above an elevated level for the nonmanufacturing sector. Are we finally seeing the nonmanufacturing sector catch up . Iris yes. The travel to the restriction going overseas and push chinese tourist to stay in china. The the last few years, bloom of tourism and the rest of was can contribute it by chinas taurus. Now they are can to beating themselves to their home country. You look at may and october, you can see also the Summer Holidays in july and august, you drivenestic trouble has up spending on many categories railway we have flights, all above 60. Im talking about the stock index pmi. Sign domestic spending is supporting the economy but my concern is in the coming months export sectors will be quite gloomy do to the coronavirus situation in europe and the u. S. It is interesting that you say that the domestic side of things now being supported because china tourists can travel. How much is that playing into policymaker targets . Thechinese president riding setting out the space industry chain. How close are they given the broader environment . I believe the most successful policies they have done so far is the cross provincial trouble which is system they have. It is a bunch of things. We have to remember its not really initiated and intentionally develop by the government. Used by big tech and it develops into a national app. Private sector also works well with the public sector. Does the result of the u. S. Election have a meaningful impact on china other than potentially moving a degree of volatility and that bilateral relationship . It depends. What we can compare is if biden wins, it will be a better situation for china than trump, but im not so sure whether biden wins will be better off for china compared to todays situation, especially in terms of the technology war. Some ideashere are in the u. S. General public that china pot tech company is doing something in the u. S. Which we this deep rooted idea is actually very difficult for any person to change it even if they would want to change it for the good. This is something i worry about. What about the impact on the yuan . Weve seen them do things like reducing the cost of shorting or pulldown the strength of the yuan. If the volatility in treasury markets is removed or the differential is narrowed, does that mean there is more of a relief when it comes to policy makers to rein in the rmb . Iris i would not say it is a its such wording used is the fade out. There is a fade out of the countercyclical factor, which you correctly point out will make the yen more volatile than before because it seems to me it implies the central bank does on want to impose their view the direction of the Yen Exchange Rate anymore. This is opening up the Capital Accounts together and then Exchange Rate liberalization. These three come together and we openinges more account and it means the facts of policy, the yen will be more volatile. It is now even more volatile than that. Surprising price swings when it comes to the hong kong dollar given the ipo we are expecting it to trade this week. The chart on the bloomberg showing the hong kong economy for the first time has seen quarter on quarter expansion. What are you watching on this front . I would say the third , cominggdp in hong kong in the fourth quarter, we have coronavirus in the rest of the world, so export factors will not be good for hong kong and hong kong is quite export driven. The other thing is hong kong does not have trouble with Mainland China, it is still restricted travel between hong kong and Mainland China in this makes life very difficult for many businessmen that travel a lot between hong kong and Mainland China and it also means the revival of the hong kong economy will come late, later than the mainland economy. Always appreciate your time with us. Coming up in the next hour, we will take a look at chinas economy with the ubs chief. We get the new figures out suggesting a recovery still on track. Next, a debt ridden chinese developer raises 2 billion in a week and sale. We have those details next. This is bloomberg. Haidi lets take a look at some of the movers here and sydney. Lets take a look at amp, gains of just over 8 after the primary takeover approach from 4. 5 management valued at billion u. S. Dollars, that is what they said today, adding to the surge we saw on friday when we saw the talks were first disclosed. Amp has had a torrid couple of years, effectively putting itself up for sale after a Sexual Harassment scandal led to the boardroom shakeup. Where watching westpac reversed earlier gains, down what is now a sixth straight day of losses. We thought some of that was due to a removal of certainty but looking past the expectations, demand going into 2021 and looking at potentially this bad loan scenario worsening as the economy continues tourists continues to recover. Cash earnings falling 62 as well as that already disclosed and antiMoney Laundering laws for westpac. We are also watching shares at after a response to the blue orca statement report calling they China Business essentially based on a bad report, coming out a counter argument that investors not buying, that stock down another 7 . Is another struggling company ever grand has raked in more than 2 billion after selling its 41 its sale fellter short of its target. What do we know about this deal . Overie it was announced the weekend that ever grand will raise 2. 2 billion in cash through the sale of an equity stake in a chinese company, an Investment Group that has a couple of investment units. They are setting a 41 stake in 41 Company Selling a stake in the company to raise the cash. Those are the details we have so far. In terms of the amount that we are talking about, how much of a difference does 2. 2 billion make . Help reduce its gearing ratio for sure, but it is far from enough. Ever grand is the most indebted developer with 120 billion debt per month. As of the end of the number, based on exchange filing, they owed 88 million to banks, shadow lenders as well and individual investors across borrowed from bondholders from around the world. Ever grand has been scrambling pricese cash and has cut on apartments during china pot gold and we to boost sales. Persuadeso managed to several strategic shareholders to waive rights to a 13 billion dollar debt payment. They are going to spend off the Property Management unit for a stock listing in hong kong and that could raise another 1 billion also, depending on the market. Up next, it is china pot mega ipo, intensifying the rivalry between the two exchanges as they vie for the top spot in a 10 trillion market. Is how markets in asia are trading at the moment. Mostly higher for big equity markets. The nikkei up or than a percent. The lowest from level since august as we see japanese yen strength. Only kiwi stocks now losing ground for a fourth consecutive session. This is bloomberg. Haidi heres a quick check of the latest business flash headlines. He signed an mou on sunday to open a Wealth Management business in qatar. He became ceo after nearly seven years at the helm of ing. A new report says u. K. Companies will raise Bank Borrowing by five times this year and wont start cutting debt before 2022. The consultant says bank lending rose to 43 billion pounds. Through august compared to 9 billion pounds in the whole of 2019. Virusoper says the fallout will be felt for some time to come. Macau is showing signs with gaming revenue declining after plunging by 90 for six straight months year on year. Revenue for october fell only by they are seeing gamblers return, however visitors to macau were still down 84 on last year. Pot topne of china brokers making their one of chinas top brokers making their debut. This debut, itt is hard to get away from the ad effect when it comes to the pipeline as well as the number of deals weve already had this year. Exactly. Cicc is the lead and joint a lot ofthe ipo expectations in shanghai. Up 20 thisare year. Its done really well not just with the new listings in china with the exposing explosion in trading activity we saw when regulators on the mainland really encouraged trading and margin financing. Injuly, we saw a huge runup mainland share prices, so obviously benefiting cicc. We are expecting the stock to do relatively well today, especially given the joint sponsor for the ipo and it is a big win for shanghai. Its the third guest listing on the main board exchange. It is not going to list on the star board, its going to list on the main board. So it will be interesting to see if they revive the index there. Is this intensifying the rivalry among them . Sofia china is the second biggest equity market in the world but even if you split the thosechange operators, two alone are among the worlds biggest, 10 Biggest Exchange is just on their own. Two very huge markets and historically, shanghai has been a venue where if they owned enterprises and banks and industrial companies, they are the shiny new start up tech hub. So shanghai attracting that ipo on thursday is a big shift and at dynamic. It from daybreak asia. Our markets coverage continues as we look ahead to the Bloomberg Markets china open, next. Tom it is not a clock i am in beijing. Welcome to Bloomberg Markets china open. I am tom mackenzie. David i am david ingles. We are counting down to the open if trade in china. Lets get together top stories. At markets across the region raising, very big week dominated by the u. S. Elections, oil slumping as President Trump and joe biden race to finish in key swing states. Tom china continues to lead the