Transcripts For BLOOMBERG Bloomberg 20240703

U. S. Futures, bond futures are lower. Youll see what is happening across the bond space. Another day of yields melting higher. We could see a 12 week in the last 14 of bond pain. Yvonne we are set for three years of losses. David the 40 bit on the 60 40. Rishaad is it 60 bonds now . David 100 loss is the joke. This is the pain point. Rishaad the 10 month highs. 91 books. It seems we have a clear path to 100. It is going to be key. The Saudi Energy Ministers talking in calgary later on to their talking about ned zero. Saudi arabia, ned zero. Net zero. Russia also involved in this. Commodities elsewhere also in the fray. We look at what is going on. Rising iron ore. Is it hope, expectation or reality . We are seeing signs of china stabilizing. Is that what is the driver . Yvonne is it going to break this disinflationary trend we are seeing across the world is one key question Central Banks are going to have to talk about. The fed, they are not going to do anything. The pause is all but guaranteed. The dots. We talk about how important they are this week. Setting the stage on what it means for the rest of the year. There are still some markets. We could see one more in november. Next year cuts are those going to continue to be praised out of the market if jay powell seems hawkish . Look at all of that. A whole map full of it of how Many Central Bank decisions there are. Boe included. All likely to hike as well. We have the likes of some asian Central Banks. Boj is going to be the big one given the speculation. David what is going to be freddie. And what we think about the currency. Trading the weakest of the year amidst the bond lead. Our peace on bloomberg laid this out nicely that some of them are done hiking. Some of them are probably going to sneak in a last line should no one is going to raise the victory flag on inflation. Rishaad it would be churlish. Respect for the aged Public Holiday today. What is the other one . Sports day. David mountain day as well. Rishaad you would think there be a squeeze. Unless you get something this week out of the boj for you to be a yen bowl as it were. Turkey, at the Interest Rate decision. Bank of england, talking about inflation coming out the day after tomorrow. 7. 1 . Up from 6. 8 . Brazil with their overnight systemic especial. Yvonne i will let you say that one. David put that one on the tv graphic. Three this week plus the boj. The bsp, philippines, taiwan, bank of indonesia. Here is some trivia. There has only been one instance in the last 45 years where the dollar index is up 10 straight weeks. That was in 2014. We could get a 10th week this week. The dollar index is up nine straight weeks. Yields are pushing higher which is to the point of our guest earlier on, real yields are higher so the incentives for you to leave in cash in both his high. Equity markets on offer this monday. Rishaad lets have a look at what the senior multiasset strategist at state street has. Great to see you. What do you make of all this . In a holistic way what is your get feeling as to what is going to do well . What perhaps not and what is likely to be the centralbank action which may dictate all of this . I think the fed remains to be the most important one. Although markets are relatively expecting for no change anyway. It is really in the details markets are looking at. It is really the dots people are focusing on. Our expectation is there is going to be no change in the dots this year. But we are going to ca revision downward next year maybe from 100 basis points next year to only 75 next year. To really highlight or signal the higher for longer message. Another thing we will continue to see is whether theyre going to revise some of their core inflation forecast given september is usually the time we will get the summary of economic projections. The rest of the other Central Banks are going to be more status quo. We dont expect any changes in terms of the bank of japan. It is still awaiting game in terms of where they see us. It is a yield story. Driving the u. S. Dollar. That is going to the weaken the yen. But the bank of england we are already seeing lights of stagflation coming through. Annie rate hikes are going to be negative for the real economy. David droid take it that favors bonds over equities . 30,000 foot prognosis. Our focus has been defensive in nature. We are long u. S. Treasuries as part of the Asset Allocation strategy. We like the yield level we are seeing given the equity market remains to be diverged. We are only selectively overweighting surgeon markets. The u. S. Is the only market we have to continue to overweight on. Emerging markets, we have downgraded recently. It is an area we have downgraded and now it has gone underway. Yours in equities is were taking some at opportunities in the equity space but it is in u. S. Equities in terms of quality. The bond market remains a better opportunity not just for u. S. Treasuries but some parts of the em bond space as well. Yvonne the whole u. S. Exceptionalism, we had a guest last week said the opportunity cost of shifting away from the market are too high. Is that how you see it . Exactly. Hedging costs are still expensive for many investors who want to get into other markets but want to hedge back to the u. S. Dollar. Equity markets is going through and earning trough for earnings recession should the u. S. Remains to be one of the stronger ones we expect coming out of q3. Their earnings story is supporting the u. S. As part of negative Earnings Growth in other parts of the market. Treasuries is still a very attractive play given the absolute yields you are getting relative to parts of the developed market. The opportunity cost is still too high and we want to play safety and quality and that is where the u. S. Stands. Attractive relative to the rest of the world. Rishaad you have the magnificent seven which have and help the market and the s p particularly to these good gains this year. If you take the equal weight s and p, only up about 4 . What is the rest of the market telling . I think the mecca cabs have done very well due to a couple reasons. They have a decent Earnings Growth story. They are also quality in terms of they dont pay a lot of dividends but they are heavy firms. There is still a low depth exposure to many of these firms. There is sensitivity to Interest Rates that is much lower compared to the broader market. We like parts of the midcaps or small caps as well. It is selectively in terms of sectors we lectured energy is one area we are liking especially with Commodity Prices being much higher. Health care is another one we are seeing going through a transformational face. The rest of the other markets. Maybe financials in industrials is what we would avoid. Although it has been expensive, but given the quality they have we are happy to hold them. Yvonne will have more from ben. Coming up, we are going to speak with arthur lange as kkr moves to acquire 20 of the data center are. David next we will discuss chinas deepening property crisis. Country garden faces two more debt tests. Authorities detained staff from evergrande. We will unpack the stories just. This is bloomberg. David csi 300 opening lower. Was trading at the lowest of the year. Bouncing back after four days of losses going into friday. Maybe a lot of that has to do with what happens with sentiment around property. Whats have a look at where we are as for as those stocks are concerned. Country garden seeing pressure. Evergrande was pain point. Yvonne faded. David 21 at one point. Almost like you changed the channel anything the program has changed. Lets talk about everything on deck. Everything from this vote should some detentions and this winding up. Kevin is with us on set. Where do you want to start . Lets start with country garden. Two key things today. 15. 4 million coupon. 492 one bond. There vote on extending the bond due to end today. Both make it extended further. The bond is not to for five more weeks. The dollar bond because theres a 30 day grace period tiered like what they did last month but there will probably do the again. Rishaad logan group. That is going through a winding up phase but i think that has been delayed. Give us some background. Logan is a smaller developer. Two units were sued in Hong Kong Court for creditors to get the money they say is owed. We have had a number of these developers wind positions. The creditors were able to seek assets from the company through a winding up order. The same judge has issued such orders in the last year. In logans case she said this morning she wants to see concrete progress in debt restructuring the time to come back in late october. Yvonne yvonne it is a sign creditors are pushing back in some ways. They are not willing to kick the road any longer. We have seen some increased pressure from center ocean and country garden. Getting the onshore creditors on board. Country garden has been able to delay repayment on eight bonds. This is the ninth bond theyre trying to do that for. While they are making progress, they are facing more progress and stress as far as getting it taken care of. David the detentions. Yvonne it does seem we are rishaad it does seem we are moving away. They further down the track with that. It is hard to know exactly where these Police Actions are. Certainly concerning to the creditors. Especially the offshore ones were currently voting on evergrandes offshore Restructuring Plan tiered the votes are supposed to happen or the meetings are coming next week. This comes at a bad time as folks are finalizing opinions as to whether or not to get on board with this Restructuring Plan. Rishaad is it getting easier . We have had facilities provided by the government saying to banks you must lend to these companies. Is it getting easier because it seems the special fund is set up has proved to be as useful as a motorbike ashtray. It does not seem as though the companies are able to tap the financing. The government is saying banks lend to the companies but the banks dont seem to be lending to the tiered lending to them. David so much. Kevin getting us up to speed where we are this monday morning. In terms of the highyield space we have seen four weeks of fairly nice gains on offshore bonds. We will show you the graphic in moment. There has been some buying and the notion that the worst is over. The worst is getting kicked down the road. Four weeks of gains every week since late august. Plenty more ahead. This is bloomberg. Sweat isnt sweet. Its salty. Lmnt. More electrolytes. Zero sugar. You feel the difference when you get it right. Stay salty. 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French regulators raised the issue on finding the device raised more radiation than is the standard. Apple says the issue is not a safety concern. Result on which nations to pay for the worlds transition to sustainable energy. Energy mr. Says developing countries cannot finance the Energy Tradition like europe and the United States. David then is still with us out of state and global markets. Talking china and a brief look at global developers. About 50 minutes into the trading week. Thanks for sticking around. Lets talk about china. Not that we are anywhere near a rally but who knows. When this market rallied it is all gas and no breaks. My question for you is if and when this china story turns, what is the market going to miss here . I think property is one area we would just avoid. It is very vulnerable sector to focus on. In terms when we look at financial would be one area that could benefit from the target stimulus we are seeing right now. Lowering rrrs. Lowering mlf rates. Credit we have seen last month did surprise on the upside. If there is going to be a push for dividends back or value approach, many of these financials could benefit from their extreme valuations. Overall the market we track in terms of msci china, we have the ability to track Institutional Investors positioning. It has been extremely low not just for any particular sector but for the aggregate market. This is a market that most of what investors we see are still avoiding right now. Yvonne yvonne it is still a safer bet at least in the sidelines and miss out on the first leg of the rebound . Yeah, i think when it comes to a lot of the chinese equity rebounds, it is often easier i would say to see the turnaround first because momentum can be very strong when it comes to actually to see a firm rebound. Every time we have seen the credit impulse actually turning around it could lead to 30 or 40 jump in terms of msci china if that comes to be the case. I am not in an area we think we need to pick the bottom right now especially many parts of asia is not expensive anyways. We would prefer to focus on the tech space in korea and taiwan. That would be a better proposition compared to focusing on the china rebound rishaad youre not into the whole fomo philosophy. Thanks a lot for joining us. Emergingmarket investors have found a Winning Strategy in buying shares in smaller companies. Our asia stocks manager joins us. Tell us about small caps. They are not doing so much better than large caps in the u. S. But overall what is the deal . I think it is in em space we are seeing astonishing outperformance for smallcap versus largecap. A 12 percentage point outperformance year to date set for the second best outperforming year in 14 years. It does look a bit shocking but if you look under the hood, it is not that surprising. The top performers in the small caps space are those that are related to the ev and ai space. We have been reporting about those speculative frenzy in the areas. If you look at the largecap space, most of them are from china. The likes of jd and alibaba. We know how chinese stocks have suffered from the selloff this year as foreigners fully. That explains the divergence. Yvonne is it likely to continue, this outperformance . Yeah, i think in the smallcap space especially within em, these are very speculative stocks so caution is warranted. They are already up 15 . There are still bright spots in the space. In india, midcap and smallcap space seeing a lot of buying momentum as the rally widens out yonder the large caps. Also as global Central Banks and putting those in em markets are preparing to cut rates as the economy slows. That would offer impetus for a further gain for a number of smallcap stocks. We are going to see probably better quality names to continue to outperform in the near future. Yvonne our asia stocks managing editor joining us out of singapore. When it comes to markets we are seeing a down day when it comes to risk assets. Stocks in particular in the Property Market. Evergrande. This goes to show how volatile this sector is. Down as much as 20 . Went back above to flat and now down 3 . A lot of news on whether the whole investigation, the wealth unit means. Logan grew pushing back. The winding up petition in hong kong. Country garden facing two tests showed the one dollar bonds extending the remnant be payment of the bond. This is what stocks are doing. Down about half of 1 off some of the lows of the session. There is so much event risk. Rishaad health care was one of the few winning once. Joined by real estate. Sadly not hong kong real estate. The rest of the region is. Tons of event risk as usual. In the form of Central Banks and data. David that is all coming up. We will leave you with there we go. A clear shot of hong kong. If you squint there is a silhouette of rish i may be known for my legendary football career, but truth is, i love a bunch of sports. The only trouble is knowing where to find them. Thats why i got xfinity. So, i can easily find and watch whatever sport im into all in one place without missing a thing. Even if its football, australian football, or football football. In a word its fitzcredible. I got to trademark that one. This season, eligible xfinity rewards members can get up to 100 off nfl sunday ticket from youtube. Sign up for xfinity rewards now. Yvonne looks like blue skies over the lion city this morning after it was uneventful weekend. The ferrari winning the Singapore Grand Prix is one to watch. I am sure people are still recovering from that fun weekend. There is no hint of jealousy in hong kong. There is a return to sunny skies out here, but no sunny skies for the markets. Japan is closed, so not much in terms of volumes this morning. U. S. Futures are still upended as real estate and health care that are big appear across the region. China property is an exception, but most sectors are in the red. All of these metals are also consolidating. That used to be one of the bright spots in this market last week, and we are watching Southeast Asia. Rishaad looking at these also adding to the markets, we have an interesting decision coming up on thursday and indonesia likewise, so lots to play for. And as you mentioned, singapore not really reveling in the grand prix, the crowds of people. Absolutely insane. David and spence of expensive, too. Do not hit them with the jealousy. We are fine because we have the peninsula in hong kong. Speaking of, an official says that luxury demand will be continued as an extended problem product as they open their flagship peninsula blend. If you have an outstanding product, there will be an audience for its, and we have only been open for three days, but we are seeing a buzz in the lobby and the restaurants, people coming to the room, and london, the whiter economy is one thing, but we are seeing very good demand for luxury in london still. I know that there is excitement going into the war rooms, you have six senses coming in, a new world of stories. You will have competition soon. How will you compete against them . Everyplace in the world where it is worthwhile to have a Super Luxury Hotel like this, you will find competition, rather than focus on the competition, i would like to focus on our own strengths. We own and operate, investing for 100 years, and we put a lot of time and effort into designs and details and thought into the hotel. I would love to show you around if you would like to look at what we have done, and we have to have the courage of our own product. To that point, give me some insight. Three days, it opens, and you are seeing the demand in the buzzfeed generally in terms of demand, 2023 was a stellar year for travel, the Revenge Travel that people thought would end earlier. What is your visibility into that the next six months . We believe in terms of global travel, there is a long way to go in terms of recovery and there have been pockets of recovery here and there, but as i said, we do believe that luxury will continue to be in demand, and remember we are investing for 100 years. If you have been investing for 100 years, there will be ups and downs. If you do not have the staying power, you will not be in the business of longterm investing, so the most important is to have varied locations to create an outstanding product that you maintain and improve and maintain that quality, and hopefully over time, you can be very sustainable. Yvonne i have been there. David clement kwok speaking with our colleagues, guy johnson and alix steel. Lets pivot from luxury to telecoms and tech. One guest says the tensions between the u. S. And china might benefit Southeast Asian companies, which could see increased investments particularly in data security. Now welcome ernest cu, the president and ceo of globe telecom. Good morning. What are you doing in singapore . Ernest i was here for the f1, a great race last night. And then i was in hangzhou for a few days as well. David speaking of hangzhou, immediately your chinese partnerships come to mind. Lets talk broadly because when we spoke to your team, we understand you had some insights into the opportunities for Foreign Companies to do business in the philippines. Are you talking to any direct Foreign Companies that might be looking to increase their capex or presence in the philippines . Ernest actually we have had significant partnerships with Many Chinese Companies and started off in 2010 when we decided to go with huawei as one of our main suppliers. We know all of these years. Then we followed through with our partnership with ad financial and we were able to build g cash for the philippines. Our meetings were just updating each other on the latest developments between us and g cash on what was going on with them. As well as with the alibaba group, they were going through changes and restructuring, and it was great to talk with them as well. Our latest investor that came into the country was singapore technologies, with the gdc data centers and we signed a joint venture agreement with them a year ago to take advantage of the trend, the philippines becoming attractive once again as far as data centers are concerned. Hong kong, given the geopolitical situation, is not as desirable anymore for hyper scalars in singapore that have some limitations of the capacity, but the philippines, given its location, geography, ability to scale in terms of land, we are now in the throes of building 124 Megawatt Facility for the philippines, and hopefully we will have it online early 2025. Yvonne i just wondered in terms of it seems like the philippines is trying to position itself as this data center hotspot in the region now. I am wondering in terms of where is the potential in that and what do you think is driving that investment you are talking about . Ernest like i said, location wise, we are in the middle of Southeast Asia. Not far for most capitals in the region, and that helps in the latency we can provide. There has also been quite a number of announced investments in terms of cables, some rain cables that would be building under the philippines. We ourselves are building two more stations on the east and west sides of the teens that will be able to accommodate these cables coming under the country. So with the added capacity as data centers, we believe the philippines will become a great alternative for many hyper scalars that have to serve the region. We have a tremendous number of people population wise in these regions, and you have to be starved served by the hyper scalars. The adoption of cloud and adapting for the area. Yvonne and how is globe intending to cater to those hyper scalars now . Ernest as i said earlier, we started by looking for a very capable partner in gdc. And they share our vision and they shared that optimism about the market, so we are building the first of four data centers that we will be holding throughout the philippines, primarily in the metro inland area where we are building probably the Largest Data Center on land that we have. It has been using for some links. We have this online and it is a Public Data Center with four structures in the First Quarter of 2025. Rishaad here is the ai question. What is your ai strategy, where is it going, and can you give us examples of how you are using . Ernest globe has never been a developer of any deep technology. We are a variable user of technology and applying it to solve problems. We are dabbling into it in terms of our Customer Care area. I have seen a very good use case of a eyewear we are using it of ai where we are using it for being involved with lending, so we do hundreds of thousands and millions of microloans, and sometimes people forget to pay, so i have seen an actual collection called done through an ai voice machine, and it is quite impressive how it has empathy and interacts almost seamlessly, undetectable with the consumer. That is the first batch of use cases, mostly with Customer Care for now. Rishaad and quickly, what about g cash . What is your vision here . You solved your 200,000 and two need more money . Does that mean g cash could potentially do an ipo . Ernest as you recall, we raised about 300 million u. S. Dollars in october 2021. We had the good fortune of turning profit around early 2022, so we have not had a need to raise cash during this difficult period. We continue to grow in terms of revenues and we are growing 20 on revenues as well as profitabilitys. And the ipo is always a possibility. What we have told the market is we are getting the Company Ready , depending on market conditions. We may do a for an the next 12 to 24 months. Again, there is no rush to do it. The company is doing well and if we need to raise money from private sources, there are lots of people knocking on our doors want to get a hold of some of the equity of g cash given the prominence in the country, so we are waiting for the right moment to do it. David circling back to the data center, you mentioned that you are looking to get them online in 2025. My question is, are you able to do the math of that, what the revenue boost would be to the business . It is long return, but do you have any working assumptions on what kind of boost it will give you . Ernest we have not really done a projection for that yet, but what i can say is that the revenues are growing very healthily across the year and quarter on quarter, i think we have grown 50 . The noncore businesses holds the key for globe doing the growth that we have been experiencing the past few years. As the telco business matures around the world, the data center forms just one of the components. We have the fintech business, health tech business, and other startups we are also looking at the moment. David final question is, you have been partners of huawei for many years. Give us an update on how that relationship is right now, speaking of the use in technology, and it has made this new phone recently. Can and should we expect that to be part of a feature into the heads locally for the philippines . Ernest they will never stop offering their handsets. They have been good partners on that site as well as our Main Partnership which is on the network side. We do use them quite a bit on a majority of our network. Most of the telco spots in the philippines do the same, but their handsets are very good products in the market. They at one point in time went up to number one on the status of units. However, the rise of the android and google systems move through the services and it has really derailed their sales. That has enabled other makers to now take the number one position, but we continue to distribute their handsets because the demand, or Consumers Want it and we believe it is our job to give the consumers what they need. Rishaad i am not going to trouble you by asking you on where the chips come from, but on the logistics, thank you very much to ernest cu for joining us. Ernest we will not disclose. [laughter] rishaad thank you so much. Coming up, kkr making another big bet on asia, moving another 20 of singtels data center arm. We will be speaking to the cfo of that telecoms giant next. This is bloomberg. Yvonne some big news we got this morning, kkr will pay some 800 billion by 20 state stake in singtels data center business. It is the latest bet on asias digital infrastructure. Great to have you on the program. You talked about how this sort of capital will help your expansion in Southeast Asia. Could you elaborate on where those expansions will be . Arthur good morning, everyone. I think the region is really booming with data center capacity, with demand. How we will use the capital, we will have a sizable presence in singapore. We like to extend ourselves across the region just as we have done with our home office for decades, so we are going in and we have announced a joint venture in tunisia as well as thailand, and we are looking at other markets. It could be malaysia, and this capital that is coming in with kkr is helping us effectively grow capital to expand across the region, and if there is an interesting opportunity across this sector, we will consider it. David just to clarify, do you get all the money up front . And kkr also gets board seats in terms of influence and management. Arthur in terms of the stake earning, it is up to 1. 1 billion singapore dollars, so it is 800 plus u. S. It is accumulated or injected in when the capital is acquired as we grow, so not day one, but it is a commitment of up to one billion singapore dollars. And in terms of board seats, there are some governance structures that reflects that 20 stake they want, so i think it will probably offer two more board seats to the to kkr for the data center business. Rishaad i am assuming that kkrs vision is the same as yours for the region. How much will this increase your capex looking forward to this fiscal year and next . Arthur if you look at the whole singtel group, we have indicated what our group capex is. I would say this would help as i mentioned with Growth Capital, so that actually reduces the group capex needs from singtel. This is really a line or capital to help us expand in the data center business, so it is part of that capex guidance that we are giving the markets earlier this year. Yvonne can you tell us more about this boom we are seeing in the data centers from ai, next generation technologies, and how does singtel become a major player amidst this boom . Arthur sure. If you look, a little known fact is that singtel today is one of the largest owners and operators of data centers in singapore. And singapore from a capacity standpoint and demand standpoint, i think there is a tremendous need for data centers that have computing capacity in singapore, and we are fast seeing the trend of this demand operating not just from singapore but emanating out across the Southeast Asia region. And it is really driven by a huge move by a lot of enterprises and governments into digitalization, especially postpandemic. You have seen the increase into computing needs, and as the year goes, with the rise of chatgpt and everyone focused on ai, we are seeing a huge step function of demand we are seeing across our customer base. But i think an added advantage that singtel has across the region is we are in this region and we have been operating in this region profitably for at least three decades already. Through our partnerships in globe, in telecoms sales, so we can leverage on that and provide our enterprise customers not just with core connectivity, but also our Data Center Capabilities as well as we are interconnected by some ownerships of cables across the region. Rishaad you have got arroyo mara, the famous futurist after the. Calm boom dotcom boom where they say that the longterm is usually underestimated. But it is actually the opposite. Arthur that is an interesting point bid we need to be mindful of this sudden surge in interest in the Data Center Space. What is important as you hear all of the news articles about x megawatts of capacity, but the real fact of the matter is it is not just land, but it is about power and locations. Power is just as important, if not more important, than the supply of land. And again, many of the players are still looking for power allocations. For us, i think we have a unique way where we joined ventures with our partners who we have known for a very long time. Singapore, we are very well connected to the various parties and we know how to execute well, but across the region, we have strong, credible, local partners who can help us navigate, as well as partnered with power plants. And i think this gives us an added advantage to be able to kind of expand quite credibly in the region. And of course with kkr coming in, it is not just Growth Capital they are providing. Kkr today owns and operates over 60 plus data centers globally, primarily in north america and europe. I think they will be able to leverage all of their network, capabilities, expertise, and use this as the exclusive Data Center Platform and expand in this part of the world where they have not been in yet. So this would be a nice entry for them. Yvonne but singapore, isnt it close to full capacity when it comes to Data Center Space . Given the allocation process to getting that space is still tightly controlled, what sort of strategy are you deploying now to unlock some of that space to build on your infrastructure . Arthur i think we are leveraging on basically our customers, what they want, and today we really are a data center owner and operator. So we are leveraging on that and we could obtain more capacity. We actually have a 58 megawatts capacity we are building in the western part of singapore, so what we have done is taking some of the old capacity we have and combining it into a larger location, and then we build. It is scalable and it will become much more power efficient. And hopefully we can position this as one of the greenest data centers in singapore, if not in the region. David i guess the question i have is looking further down the road, does this become your core business . And if not, do you see an ipo spin up at some point of these assets . Arthur rate question. You might recall two years back, i recalled a similar bloomberg type of conversation where we talked about a strategic reset over at singtel. 2. 5 years ago, there had been a change in the management team, including myself, and we have laid out clearly what we want to do. One of the pillars of this strategic reset we had was to scale our growth engines. The core business, which is our mobile business, we want to reintegrate it and we are focused on increasing the returns by energizing, optimizing the operations. In terms of the growth engines, it is to reallocate growth and focus on the growth leveraging on the digitalization trends we are doing. One of them is our data center business, the other one being ncs. Any of the data center business, i do think when we started this strategic reset, less than 10 of the group ebitda came from these two businesses. I would say the next few years, we have every plan to grow this and scale up to 20 of group ebitda. David lets leave that something of a tease for the next conversation, whether or not we will get a spin off. We are out of time. Arthur lang, singtels group cfo joining us out of singapore. Maybe people are still recovering from what was a fun weekend. One more big interview coming up in the next hour. This is bloomberg. Allday Energy Starts with clean hydration. Lmnt. More electrolytes. Zero sugar. You feel the difference when you get it right. Stay salty. sfx stone wheel crafting the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. It still does. What can you do with spy . Rishaad we are nearly 8 30 in the morning in singapore and shanghai. I am Rishaad Salamat in hong kong. Asian equities on the way down and investors looking ahead to week that includes a plethora of policy decisions from the Federal Reserve and the bank of japan. The csi 300 rebounding from its lowest level of the year. Evergrande shares slumping again as authorities detained some staff edits wealth units. Country garden focused with deadlines for the yuan and eight dollar bond. Plus, we will be speaking exclusively to the ceo of Indias Tata Communications about the impact of acquisitions and artificial intelligence. Asian stocks on the way down paid we also have headwinds coming from that close on wall street we are seeing, the major benchmarks falling back. The msci asiapacific now at lows of 0. 6 down. Some optimism, which was some of the upbeat data that came out of china last week, that has dissipated to some extent. There is no japanese trading today and markets are shut in respect for the aged day. The Central Banks do with its decision later on this week. We are also looking at the open in bangkok, following the region to the downside. Odds of news and numbers out of bangkok at the moment, talking about the minimum wage hike which is expected to take effect on the first of january. The details of this will be in november, and they are also trying to get health care and Tourism Industries to get more investment as well. Looking also at india, futures also at the moment on the way down, no data to be getting our teeth into, but we are looking at the rupee which is unchanged, 83 rupees. Lets get more on what is going on. Ashvin murthy is the chief Investment Officer at avm capital. What is your overall take of the Market Action we are seeing and how do you navigate all of this . Tell me where exactly we are as we perhaps leave some of the higher and get some normality. Ashvin i think we are coming to the end of this rate hike cycle in developed markets. It looks like the fed is done and the ecb might have done their last hike. We are expecting the bank of england to do their last hike this week, so we are coming to the stage where inflation is drifting lower in many economies, perhaps not coming down as much as people would like, but we will let the quantitative tightening run in the background us things tighten more in the next few months. What we are looking at is rates to stay higher for longer, one of the terms used by the bank of england last week. And we will see that happen until the labor market softens. With that in mind, we expect more Monetary Policy tightening, more tightening of financial conditions, which should affect asset prices the next few months. Rishaad and also a recession is the moment being downgraded, the chances of one being downgraded. But could we be seeing some of the green shoots for some of those the weeds perhaps of stagflation emerging in places like europe and the u. K. , and perhaps even a hint of them in the u. S. . Ashvin yep, i think we are seeing that in the u. K. , potentially europe as well. The u. S. For now looks pretty strong. Real growth is still above 2 . I think that is a function of nominal growth slowing but inflation coming down a lot faster, which should stop over the next six month as Energy Prices are going back up right now. We should seek see real growth starting to shrink the next six months. So with that stagflationary regime coming up the next six months in europe and u. S. Nominal growth slowing down and china not really stepping on the stimulus as much as people expect, we should see earnings and growth start to slow down the next six months. Rishaad the prospect of inflation, though, looms large for this part of the world. And i am not just referring to the oil price, but rice and what happened with the price of this grain is also concerning given how ubiquitous it is. Ashvin yes, so we have had a bit of that last year when the war broke out in russia and ukraine. We saw wheat prices through the roof and now rice prices are going up as well, so the supply side dynamics will come and go. What happens in are part of the world as you will see the currency start to suffer a little bit as the import demand starts to go up, so that should create balances. Rishaad what does it mean for an investor overall . Ashvin i think we have had that recovery from last year, again looking at equities. We call it priced for perfection right now and a lot of markets are price for a goldilocks scenario the next six months, which means growth increases while inflation comes down. You need everything to fall into place exactly for that to play out. We are a bit more cautious. We think Earnings Growth will come down so we think we should be defensive on equities. The and the fixed income space, it makes sense to look at steepness, looking at when centralbank hikes are done. The tendency is for the rates to steepen on the long end once the banks are done hiking, and the u. S. Dollar will remain strong. Rishaad there is u. S. Exceptionalism and we have seen this in various manager surveys as well. The place to be is the u. S. , but it looks like a very crowded trade and valuations are not that supported. What do you make of that . Ashvin you hit the nail on the head. If you look at the Earnings Growth of the nasdaq, not even looking at the selling, they started to accelerate at the end of last year, but how much of that is priced . If you look at the multiples, they got back to something close to 2021 when there was a lot of euphoria, so there is the balance between one and four years where we see good Earnings Growth because these companies have good cash levels and are not really affected by Interest Rates, but a lot of that is in the price. Coming down to how everything is priced to perfection, that is the only place that is high right now, which is why they are trading at lower levels, but if you get out of the nasdaq and look at global markets, you notice that Earnings Growth is slowing in these markets have not really done much this year after falling last year. We think the next six months, the rest of the world should see equity indices go down. Rishaad one place which perhaps is not yet priced for perfection, but according to at least one commentator we had on friday, saying that even those with hugely in the crosshairs of the funds in the world is japan. Still, it is an undervalued story. How are you reading it . Ashvin i think the pockets of growth we see in a few places as japan, india, data has been really strong, so you should do relatively well compared to the rest of the world. You see pmis and capex intentions go up. The only thing that is holding back markets in japan is the exports, whereas the Global Economy slows down, they do export a lot of stuff to the rest of the world, so you will see the global balance go down to japan, but the domestic economy is doing well. Rishaad when you finally get out of yield curve control, cut it open the floodgates . Ashvin it really depends on how fast Inflation Inflation looks like it is slowing down a bit in japan. If that starts to be accelerate and we get Something Like what we saw in the u. S. In 2021, it could be a big problem. If inflation reacts hillarys and goes higher than 5 , the bank of japan will be forced to raise rates. Doing that at a fast pace creates problems for the rest of the developed markets. It will increase the premiums in the bond curves, and that is the reason why we like these steepenings in developed markets because you can see long yields rise if the bank of japan abandons the ycc and starts raising rates. Rishaad we will see how it works out. Ashvin murthy from avm capital joining us from singapore. Coming up, we will be speaking exclusively to the Tata Communications managing director and chief executive, and how he sees ai driving some of its businesses. And we will also look continuously between the u. S. And china. Both sides have discussed a possible meeting for their leaders. We will get you an update on the way next. Rishaad that is the hang seng. We are at the moment down by 0. 9 . The csi 300 at one stage to levels we have not seen this year, i. E. Had dropped to the lowest level this year. Now looking at the shanghai comp, that is turning positive as well. Tech is a drag but what is a real drag is what is going on with the property developers. It is all about the health to the property sector, which is really causing rippling effects and consistent concerns, offsetting any optimism spread by some of the signs of stabilization in other parts of the come economy. Lets take a look at the big stories we are tracking with south korea asking apple to report on electromagnetic waves emitting from its iphone 12 models. This after french regulators raised the issue last week on finding the devices released more radiation than permitted under european standards. Apple plans to update the iphone 12, which has already been phased out, but says the issue is not a concern for safety. Meanwhile, seoul has condemned the military action between north korea and russia. Russian president Vladimir Putin met last week with north Korean Leader kim jongun. The kremlin says no military agreements were signed during the visit. Brazil has called on rich countries to pay for the worlds transition to sustainable energy. The countrys Energy Ministers is developing countries cannot finance and energy transition. Brazil has been calling on nations to follow through on their financing pledges, which currently fall shy of the trillions of dollars needed. Lets have a look at geopolitics on the possible november meeting between President Biden and president xi. That was on the agenda when senior u. S. And china officials met over the weekend in malta. Chief correspondent Stephen Engle is with me now. How significant was this . Stephen you know the historical significance of malta. There was the malta conference in 1945, meeting in the early days of world war ii. You had the malta summit in 1989 around the days of the fall of the berlin wall when George H W Bush met with gorbachev. This time, a little lesser of the top names, but it is these two gentlemen you see here, jake sullivan, the u. S. Security advisor, and wang yi, the foreign minister of china, meeting in malta over the weekend, trying to get the channels of communication going ahead of a potential in person meeting on the sidelines of the asia summit. Rishaad i try not to get it mixed, trying to understand where there are problems. Stephen and there are a lot of issues they need to get over if they want to get this relationship back on track. Taiwan is one big one. I do not think there was anything that moved the needle on that. There are entrenched positions there. Jake sullivan is concerned that wang yi today is flying to moscow and will be meeting with sergei lavrov, his counterpart in moscow. The u. S. Concerned by beijings supportive moscow amid the war in ukraine, again, so wang yi will be in moscow the next three days beginning today. He and xi jinping will not be going to the u. N. General assembly in new york where other World Leaders are gathering. This is an opportunity for the United States and we will have to see where they go from here. We also heard that Antony Blinken later today will be meeting with the Vice President of china as well, so there is another highlevel dialogue. Rishaad they will not be meeting with the Chinese Defense minister. Do we know where he has disappeared off to . Stephen no. He has not been seen in the public for a few weeks now, and verses tell us that at the multimeeting, they did not discuss this, but sources say that li shangfu has been removed from his post as Chinese Defense minister as well as state councilor. He is a very senior individual in the Chinese Government and the pla. There is speculation from other media that he is under some sort of disciplinary review or investigation. Reuters and other news media have talked about this pla review, this government review, of pla lee terry procurement. There might be some violations there, but it is all speculation for now. Rishaad thank. Stephen engle. Lets talk about the German Foreign minister. She is saying that the European Union must reduce its reliance on china. She caught up with our very own Annmarie Hordern and they talked about how the regions strategy has changed amid the global fallout from the war, which is taking place in ukraine. We have learned our lessons from our russian dependencies. And again, i believe if you can beat in politics suffer reflective of saying, this was obviously not the right way to go, we had such a high dependence on russian gas and oil, but especially gas, and obviously in the past, the former governments took decisions which were not the right ones. Speaking of the gas pipeline in nord stream 1, it is a purely economic thing, nothing to do with geopolitics, and i was in a position back then and i was also at the peninsula where there was a source of this pipeline coming through as i spoke to many people there. I could not only feel from our partners in poland on the baltics, but they also said there that this is also a geopolitical dimension. So before the election, i was always arguing, we have to not only trust our words, but we have to see the action. Now when we came in government, we set already in our Coalition Treaty that we have to rephrase our dependencies and we formulated also before the russian war that we will do a new china strategy and after the invasion, the full invasion, we not only wrote the strategy, but we prepared for the things we should change in the future. This is like limiting annmarie what about chinese retaliation . Yes, first of all understanding that if you are bound closely, it can endanger yourself, especially if you are having such a high dependency of the regime like in russia, which is in the end taking your own peace of order. Therefore, cutting off all dependency from russia, but also now with regard to china, derisking is our total understanding of the strategy. Not decoupling, because you cannot decouple in an interconnected world. And a connected world is also the way to peace, but we should be able to defend ourselves, not being naive. Being a partner in climate issues, being a competitor with china with new technology, but also seeing that we are systematic rivals and we have to protect our own vulnerability. This is where von der leyen comes in, the Commission President , to strengthen our Critical Infrastructure in europe, but also looking at outbound investments. Rishaad that is the German Foreign minister, annalena baerbock, speaking with our very own Annmarie Hordern. We have more coming up on bloomberg. We will have the market checks and more. background noises this is a clustomer. Hello its what happens when Marketers Group customers with very different behaviors. Into one tangled mess. This is a mess with mailchimp, marketers can use realtime behavior data, to personalize every email for every customer. Turning clustomers, into customers. Intuit mailchimp. The 1 email marketing and automation platform. Is it possible to fall in love with your home. Before you even step inside . Discover the Magnolia Home james hardie collection. Available now in siding colors, styles and textures. Curated by joanna gaines. Rishaad there you go in sydney. It is just a Beautiful Day by the looks of it. The asx down by 0. 6 and edit and it comes as shelby look is taking over as australias first female central bank governor. Its get to bloombergs swati pandey. Is the rba likely to be any different under Michele Bullock . Swati yes, for sure. In the near term, which is just the remaining months of this year, not likely to change too much, but come 2024, we are going to see a new reserve bank, which will have fewer Interest Rate meetings, eight instead of 11, or press conferences. There will be a press conference after every single policy meeting. And there will also be a separate Monetary Policy board, which will have nine members, and that will be a separate governance board with nine different members. And we are still not sure all of those members, who they would be, if they will be appointed, how they will be appointed, and when they will be appointed, so there are a lot of question marks, but it is something the government and the rba have planned for in early 2024. Rishaad what has she talked about in terms of her Top Priorities . How do they differ . She comes from financial oversight background, close so could we expend more concentration on that . Swati she did talk about the inflation fight as one of her Top Priorities and she described inflation as still too high in her last speech, which was towards the end of august. So three weeks ago. And that continues to be her top priority, just like her predecessor, philip lowe. And yes, given her background in Financial Stability, a lot of economists we have spoken to say that she is likely to be more dovish than philip lowe. It is just going to be a minor difference. So with philip lowe, we were expecting one more Interest Rate hike. Maybe bullock will be more concerned about the impact on households because of the Financial Stability risks of high debt. And the other priority, the second major priority she has spoken about is the implementation of this reserve bank review, which i just spoke about, the new Monetary Policy board and the change in the culture and leadership that she wants to bring about. Rishaad very quickly, what is the deal at the moment . What is the Interest Rate environment like and what short of shape is the australian economy in . Swati we have had four Percentage Points of Interest Rate hikes since may 20 22, and it seems like the economy is absorbing them pretty well. The labor market continues to be tight, the Property Market has the pricing we rebounded, and we are seeing strong price growth in may richer in major rockets across australia. Consumption has weakened substantially. People are spending a lot on discretionary items only. But we are still seeing huge expenditure on cinema, so the barbenheimer trend that we saw july or august, we had major sporting events that people were spending there, and there was this whole swift mania that happened as well and people were buying tickets for the february eras tour in sydney, so people are still spending on things they want to spend on. And the economy is able to kind of absorb the shock for now. Rishaad thank you so much. Swati pandey, our economics reporter in sydney, on the new woman at the head of the reserve bank of us trillion. We are reserve bank of australia. This is what we are looking at in trading could we have a bigger alpha in terms of recovery. Csi 300 was at the lowest level from the start of this year, but it has recovered, and perhaps if you look at the overall benchmarks, we are seeing a turnaround across the board. In essence, we had a gloomy mood related to the detention of some of the staff at china evergrande, the moneymanagement business, and equities in china, debt filing by more than 17 from a high that we saw in december of 2021. The hang seng looking like all of this, but that turnaround as may be taking place in china because it was reflecting back on the positive data or less bad data. Perhaps hinz of stability priced into the markets. We have got the hshares as a drag in property. That is shanghai, and this is the power goes out and we still have wifi to do our homework. And thats a good thing . Great in my book who are you . No power . No problem. Introducing stormready wifi. Now you can stay reliably connected through Power Outages with unlimited cellular data and up to 4 hours of battery backup to keep you online. Only from xfinity. Home of the xfinity its an amazing thing when you show generosity of spirit to someone. And you want people to be saved and to have a better life, then you dont stop. We have been able to reach over 100 Million People impacted and affected, and at risk of hiv. The rocket fund takes all of the work that were doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. The idea that we have saved five Million Peoples lives, its overwhelming. Its everything. Rishaad this is a look at mumbai is where 15 minutes away from the trading day with the benchmarks there which at record highs last week, just indicated to go to the downside. You are watching india focus on bloomberg markets. We are taking a look at the key investor stories, or some of the stories investors are watching out for in india. We have reserved banks option. A bit Like Operation twist. Shares of Jupiter Lifeline Hospitals are set to start trading. We got the Modi Government earmarking 1. 6 billion to promote local artisans and craftspeople internationally. Lets have a look at how new delhi will be buying a dozen russian fighter jets, even as his friends try to sla and punish to isolate and punish moscow for the war in ukraine. Our correspondent is in new delhi. What type of planes are these . What will the purchase of these jets due to the relationship india has with the u. S. . Reporter if you look at it, these are the twin engine fighters, and these are the mainstay fighters of the indian air force. Its got about 18 squadrons of these fighters, and very much the backbone of the Indian Air Forces fighting fleet. What is it likely to do with the United States . Not much. Because ever since the ukraine war started, india has been able to explain it to the u. S. And the west. The european countries, that its dependence on russia for military hardware is so high, and with an active border dispute with china going on, it is impossible for india to all of a sudden stop buying military hardware from russia. But business from russia has dipped, according to the separate report. But russia remains the largest supplier of military hardware to india. Rishaad there are only buying a dozen fighters. According to the air force, their shortfall runs into hundreds. Reporter yes. That is exactly the balancing act that india is trying to do. Where is the balancing act . While theres a lot of fighters, they are buying 12, and that is to make up for the same kind of fighters that have crashed in the past. They were inducted into the air force in 1998 and onwards. There are about 272 fighters. Thats of those, about 11 have crashed. That is where india comes in, saying we are maintaining a minimum with the Northern Borders with china and western borders with pakistan, and therefore these are numbers that we cannot do without. You must understand, that is the argument india puts forward to the u. S. And its other friends, that you must understand that it is the very minimum and you must let us go ahead with it. Rishaad it does seem given what is happening in ukraine, and you just mentioned crashes, that i suppose this is indicating they are not very good planes. So, why buy it . It is also a turnkey operation, two. Reporter it is a legacy. If you go back a few decades, india has been very dependent on russia. Changing an aircraft or getting a new type of aircraft is very costly. It is not only maintenance, it is also training, it is also inducting, and marrying it up with the doctrine of india. If you buy a new fighter, you have to do all those things over again. That is a big problem. While india is slowly moving away from russia, that is not going to happen very easily. It is going to take a long time, perhaps a decade or more. This dependence on the russian fighters will continue. Rishaad always a pleasure. Thank you so much. Our government reporter joining us from delhi. We will also look at the chatter in india growing louder about the potential inclusion of the nations debt in a key jp morgan index. Our reporter joins us now from mumbai. What are the prospects of inclusion in these indices . They have been disappointed before. Reporter thats right. As we go deeper into september, the index reviews are coming up. The big one for india is the jp morgan review, then the other one is the ftse russell review. The big one is the jp morgan, because that is what india is looking to get into, the jp morgan global emerging market index, which krach is about 250 billion of inflows. What is likely is that investors probably are pushing for indias inclusion more this time around because they need more diversification in their portfolio. Remember that russia is out of the index and china is seeing more geopolitical concerns. In that scenario, india is the biggest emerging market which is still outside any global index. Theres about an 18 size of the global market. This is why investors are more pushing this time around. Interestingly, it is not the government that is so keen on inclusion at the moment. For one, they are not sure on the volatility of these flows because if the market shows potential, there is a potential of these flows going out. It is more being driven by investors probably this time around that india is a likely candidate for inclusion. Rishaad i expect a lot of tracker indexes would flood in, should it happen. That has got to be the main indication, right . Reporter yeah. Basically, we are looking at 25 billion to 30 billion of inflows over a period of time if india does not get included into the jp morgan index. That is a lot of inflows for india. India has traditionally been unlike if you see south korea or indonesia, where Foreign Ownership of local bonds is much higher. That could have a lot of implication, and also the demand supply mismatch, which we have traditionally seen in the bond market, a large chunk of foreign inflows help tubes all of the supply that has been growing over time. Rishaad one of the road humps in the way, what is stopping inclusion . What are the hindrances . Reporter what investors have been pointing out over time is certainly india has some operational issues that are holding back the inclusion from the investors point of view. One is the creation of the proceeds from india, and the registration for processes seen as more cumbersome. Then, there are margin requirements on the traits, which of the key reasons that investors have been pointing out for holding back on wanting india to be part of the indexes. Rishaad thank you so much for joining us. Bloomberg senior fx and rates reporter. Lets tell you what we have coming up. We have an exclusive interview with our guest. That and more on the way. This is bloomberg. Explore endless design possibilities. To find your personal style. Endless hardie® siding colors. Textures and styles. Its possible. With james hardie™. Rishaad you are back with bloomberg markets. We are focusing in on india because our next guest runs global data and Internet Provider Tata Communications. Their managing director is amur lakshminarayanan. He is in singapore. Also with us there you are. Thank you for joining us. What is the Business Environment you are operating in like . Guest the macroeconomy is what it is. We all know the background of what is going on given the war and other situations in Interest Rates in many countries. It is a great time for being in the business because Enterprises Worldwide are still investing. They want to ensure they can get all the benefit of the cloud, in a more secure manner. They want to leverage internet in a big way. They want to ensure they have Great Customer retractions. That fundamental investments is still going ahead. It is a great time to be in this business. Rishaad absolutely. And a changing business. We have to bring up the ai question, changing the game as well. Tata Group Announced they would partner with computer infrastructure. How does that deal impact you in the Telecommunications Wing . Guest i think telecommunications is the lead partner for establishing the ai cloud in india. We already have offerings in india where we offer iso private cloud for many enterprises. We have community clouds. Indias large health programs, the cloud is owned by yuan communications by Tata Communications. We have used the media capabilities to deliver some of the at capabilities to deliver some of the ai capabilities. We want to dedicate the ai cloud using the hardware and software, and they would take that to market and operate for our customers. Of course, other companies such as tcs would build applications and use the Data Available to do all the training and so on. Ai is a big thing all over, particularly in india. The government has declared as part of the recent g20 that ai will be one of the crucial technologies taking the country forward, making technology more accessible, and so on. We believe investing in that interest should do a good deal of good for our enterprises. Rishaad absolutely. The thing is, you also have tcs part of tata group. How can they help you in this regard, and will you leverage their Knowledge Base . How is the ai strategy evolved through the course of this year . Guest on the first question, yes, we would offer the ai cloud, which helps the models to be trained and deployed. Tcs would be the application partners for our customers, building the applications that are industry and customer specific applications for truly leveraging the benefit of ai for our customers. That is how the partnerships work. To the question on how we have been using ai and how it has evolved over the last three years, as part of our reimagined strategy we launched three years ago, two things are core to those investments, to the strategy. One was innovation, and the second was ai at the core. There was a big drive, first of all, to bring a certain level of maturity to the organization. We have been working on that for the last few years, to bring the Data Maturity to a high enough level, because you need that kind of Data Maturity to take all the benefits from ai. That part of the journey is more or less done. The next phase is where we are looking at ai to see where we can make use of this data we have. We look at that in two parts. The first is ai for internal efficiencies, then we have made some significant progress in terms of using it in our internal operations to bring efficiencies to our operations. The second part of it is to see how to use the data we already have and embed that into our products to bring the benefits to our customers. Just to give an example of that, we have a mobile solution, which enables devices to be connected wherever they are in the world locally. Rishaad you are in singapore. No doubt it is the formula you are therefore. Formula one is something you have embraced. It become it has become a core driving media in your group. Give us a sense of how you are doing up. Guest formula one has been a customer for us for over 12 years now. Just in the last three years, we transformed together with them the business in terms of how the signals from all the cameras you see, the action on the racing track, all are taken back to 500 Million Consumers worldwide. They shifted to a new production model. Now, all the signals are taken to the u. K. , then it gets distributed to 180 countries. That is a significant transformation. That has given them a lot of benefit in terms of sustainability, in terms of cost reduction. That is one example of significant transformation we have been able to bring to formula one. They have declared the sustainability as a goal, net zero in 2030, and we are pleased to be partnering with them along this journey. Similarly, we have other major customers in the sporting arena. We just concluded an accusation in the u. S. Called the switch. That gives us a footprint in the u. S. , as well as production capabilities. We are very excited about the business in the media. Rishaad thank you for joining me. That is amur lakshminarayanan joining us from singapore. Indian markets opened about three minutes ago. Lets look at what it looks like in the rest of the region. 0. 3 down for the nifty. Looking at one stock in the crosshairs is vodafone. It shares were up nearly 6 . They are now producing a gain of about 2 after they did buy some new airwaves. This also because of a report of getting acquired, saying the company is not in any discussion to be taken over. This is in mumbai. Indian government bonds in focus as they could be included in the jp morgan index as well. That has not been evidenced, but we did see prices last week which indicate we may well be seeing that happen, and bond yields dropped a fraction. Lets tell you about more coming up. Looking at the markets in hong kong as they go off for lunch. This is bloomberg. Rishaad bloomberg has learned that ubs got a dozen jobs in its u. S. Investment bank last week, part of its integration of credit suisse. Sources say those impacted including ubss cohead of consumerproducts and retail. Earlier, we reported the firm is expected to cut hundreds of jobs in asia, and could slash more than half of credit suisses overall workforce. Speaking of credit suisse, bond deals with it and bank of america and connected to debt swaps under emergingmarket issues are under renewed squirt scrutiny. This is after new labeling guidelines were issued for the socalled blue bonds, using debt matures swaps. Chevron saying it has received production from an export facility in australia that suffered a fall last week, even as Union Workers continue strikes. Schedule delivered to use from the gas scheduled deliveries were not affected. This is despite an s question in industrial action over the weekend. Staying with strikes, with the General Motors chief executive saying the company was ready for the impact of that industrial action, telling bloomberg the offer to the union was strong, and the plant shutdowns could have been avoided. I am extremely disappointed and frustrated we are even at a strike. We didnt have to get here. Gm has an externally strong offer on the table. It is the largest increase from a wages perspective in our 115 history, along with worldclass Health Care Benefits and many other provisions, job security, etc. , and a cola adjustment. When you look at the deal on the table, we dont need to be here. Yes, they have one plant down right now, and it will impact three very important products. Two brandnew, Chevrolet Colorado and canyon, midsize pickups and demand, as well as our cargo van that does exceptionally well in the market. This is having an impact and we will have to see where they go next. We were ready for this. We have dealt with covid and the semiconductor shortage, as well as other supply chain challenges that have continue to persist from covid. Our team knows how to manage these situations. They are staying agile and we will do what is right for the company. This is a strike that didnt need to happen. David you have made an offer for a substantial increase in wages. This is not what they want. You implied they do deserve an increase in wages. But is this about more than that . Is this existential for the Auto Companies in terms of your need to move into electric vehicles, and from their point of view, moving to evs will cut the workforce by as much as 40 . You are absolutely right. This is a once in a century transformation we are in the middle of, moving from internal combustion vehicles to electric vehicles. We are at a Pivotal Point because we have so many electric vehicles ready to launch, in the process of launching. This is important to securing all of our futures. We need to get these vehicles out. Weve got waiting lists for most of them, or orders already in place, so it is important we meet that demand. For job security, we have jobs for all of our people as we make this transformation. More than two years ago, we started planning for this. One of the reasons General Motors invested in doing our own power units, a component very important on the electric vehicles, we designed them internally and are allocating adduction to the plants that build internal combustion vehicle engines right now. We have worked to have a job for everyone so we can make this transformation together. Rishaad the General Motors chair and chief executive maryborough. Lets take a look at markets and what is going on in hong kong. First of all, looking into these companies. Two more tests added. Evergrande up with arrests taking place. Chinese listed stocks here hoping to dragged on the market ash helping drive down the market. Chinese listed stocks here helping to dragged down the market. We have that turnaround for mainland chinese equities. Not so much for those stocks trading here in hong kong. Up next, we have bloomberg daybreak middle east and africa. Did we just get hustled . Theres no way they were 70. Interesting. Hm . Its both an electric and a gas car. Yeap. Quite the paradox. Hmmmm . Hmmmm . Hmm . Hmmmm . So jjs for lunch . The first ever lexus rx plugin hybrid. Electric for short trips. Gas for long. It really is both. Sweat isnt sweet. Its salty. Lmnt. More electrolytes. Zero sugar. You feel the difference when you get it right. Stay salty. Nice footwork. Man, youre lucky, watching live sports never used to be this easy. Now you can stream all your games like its nothing. Yes [ cheers ] yeah woho running up and down that field looks tough. Its a pitch. Get way more into what youre into when you stream on the xfinity 10g network. The following is a paid program. The opinions and views expressed