Relationship, turnbull had for new york after what was described as the new president s worst ever call. We have world coverage here in daybreak asia, lets check Energy Markets and see whether chinas challenge to boeing and airbus is actually a threat. Betty and we will see if whether President Trump and australias Prime Minister can mend ties after that tends phone call this year. And come up Berkshire Hathaways shareholder meeting. Liu inive, i am betty new york. It is just after 7 00 p. M. Yvonne it is just after 7 00 a. M. Here in hong kong. We have this capitulation in the commodities market. Betty the markets would have gained except for the fact we had oil prices really dragging down to some of these Energy Shares. Oil continuing to plunge lower and lower. Brighter for investors, the Health Care Bill passing the house, the senate, and whether it will be put into action. We have the big jobs report. Yvonne they are looking for a reprieve, not what they have seen in march. The fed has put pressure on them now. Look how asia is performing new zealand, flat. 6972. Olding at australia, closing to the lowest levers since the Commodity Index since september with oil taking a 5 leg a lower. We see it at. 4553. Brent holding below 49. Futures heading lower today. Could see pressure on stocks. We wait for the Prime Minister to meet president in new york. Japan and south korea, japan the celebrating childrens daytoday as we wrap up those three days. Dollaryen, 112. 51. We did touch 113 briefly. Bullish signs for the dollar moving forward. Lets take a look at markets this week. We have seen several obstacles when it comes to apples earnings and u. S. Car sales. We see the weakness in commodities continue on. The big question is, will this be the Inflection Point where we see weakness going through . Betty absolutely, the markets are richly priced right now. Any kind of negative news will take stocks down. Lets get more with su keenan on the ins and outs today and what drove the market. Su the oil route spread through commodities. The fact we had insurers rebounding with of the health care passage news. Lot to do with why the s p rebounded and ended up in the green. Nasdaq came up. You have an unchanged close setting up for friday, the big jobs number. Lets go to the spotlight stocks because they have everything to do with earnings. You see really strong gains here. Of earnings result we talked about after the bell last night, theyre hitting the sweet spot. They are tracking big merchants. Viavi solutions blowing out earnings. They turned around the late in the day as stocks recovered. Snapshotto the market and look at just how much we had oil and gold and copper under pressure. We sued them change as we get into extended trade. 46. Is that it was down at least 5 . Gold coming off its biggest to date decline us in september. They say the fed will be raising rates ahead, in part on a strong jobs number. If we go into the bloomberg, we will see how the fact there is a return on investment curbs curve down in the blue, versus the curve in commodity, a big gap there. It has to do with the supply and demand situation. It has not tightened to merit the entanglement we see at the top. There is a loss of faith that these opec types can do anything to reduce the glut. Yvonne thank you, lets continue the conversation about the oil rally. Futures on both sides of the atlantic dropped to the lowest since late november. Take a look at this chart. It is at 82. 25. They are backing off their bets that prices will rise. It shows a fall in the net long positions as this optimism wei ghs. Lets get more from San Francisco. Good to see you come i think you can point the finger at many things, whether it is u. S. Shale or china or opec. What caused oils latest fall . You can point most of the fall to the fact that the market is losing faith. Opec had agreed to cut its production. You had the Nigerian Oil Minister say he thinks theyre are going to extend that agreement to cut production. But they have not acted, and the Oil Supply Glut in the world persists. U. S. Production is rising. Output is still at its highest since 2015. Knock of that, you have a on effect from china, saying it will clamp down on its Financial Leverage and increase scrutiny. You have investors leaving commodities, including oil. Big catalyst, a does this selloff seem overdone . Lynn that is a good question. Technicalere is one indicator that suggests we may be headed for a rebound, or at least there is an argument he made for that. The 14 day relative strength index for the u. S. Benchmark, texas intermediate, has fallen below 30. That suggests what you said. Betty what does this all mean about opec . What does it tell you about the influence of opec and how much they matter to the oil market . Lynn that is a good question. I think it is fair to say that opec still remains an incredibly important part of the global oil market. It does something and prices go in one direction or the other. What really signaled is the fact the market is done was talking and wants to see more doing. It wants to see opec come to an extension of the agreement. U. S. Production continues to rise. Producers here are hedged to the point they can continue drilling at these prices. You could very well see the supply glut persist. Yvonne talking about the spillover affect, it has been comesd so far when it across asset classes. How is this weakness affecting the stock market . What happens to the energy exporters . Here got emps clobbered. Chesapeake energy was the worst performer in the s p 500. Pipeline operator williams, transocena, marathon oil, got hammered by this. The interesting thing to know, this came at an incredibly unfortunate time. , theyme of these emps reported earnings that exceeded analyst expectations. Chesapeake had its First Quarterly profit in more than two years. The oil marketn transcended all of that. Thank you so much on the oil market. Whats get the first word news with courtney collins. Seeminglyp, the doomed to mission to replace obamacare has staggered through the house as republicans mustere d just enough support for their new bill. It sends the bill to the senate, where it is having little chance of passing in its current form. Republicans are worried the plan would cause millions to lose health insurance. President trump that obamacare is essentially dead. Mr. Trump it has been a catastrophe and this is a great plan. I think it will get even better. Make no mistake, this is a repeal and replace obamacare, make no mistake about it. Republicans and now see what they gave their name to. They put their name next to paying more for less. We will make sure the public is aware of that. The leaders of Frances National front privately agree Marine Le Pen faces defeat in sundays president ial election. They now say even winning 40 of the vote sunday would be a success. 22 latest poll puts macron points ahead after surveys made in the clear winner in the debate. You can be sure bloomberg tv and radio will bring special coverage of the french president ial election sunday and full reaction on monday. Set for second round of reforms with as many as 10 companies proposing to sell stakes. Once the private sector to become a minority investor. Air china and China Southern proposes to consolidate their free units into a new company. Watch the open after the Bank Reported a fifth Consecutive Year of rising profits. To 1. 6ome rose 7. 5 billion dollars, beating estimates compiled by bloomberg. Earnings from trading bonds in the First Quarter helped boost they predicted similar results this fiscal year. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. I am courtney collins, this is bloomberg. Thank you. We are looking at financial leads, the bidding race for moneygram. Is a worried u. S. Regulators will intervene . Ask why bonds are at a turning point. This is bloomberg. Yvonne this is daybreak asia, i am yvonne man in hong kong. Betty i am betty liu in new york. Equities slide after strength magnified losses in the selloff of european bonds. We have the head of americas fixed income strategy. Say the bond markets are at a turning point. What do you mean by that . We are at a confluence of forces happening at the same time. On thed was mildly hawkish side. Theyre looking through the weakness on the data. Were looking at the charts and how yields are forming. I can look at the moving the resistance around the 230 level on the 10 year. Those need to get resolved in the next week or two. Betty there is still debate about whether the bond bull market is over not. There is a big question whether the bond markets or said it really reflects what is going on in the economy. Richters,e had jim who said the u. S. Will be in a recession. What does the public think about this . I put out a twitter poll and a 900 people voted. It is still going on, so if you have not voted, i encourage you to go on my twitter. And vote. We asked people, do you think a recession is coming in 2017 . Over the last few hours, 65 of those who voted say yes. They see a recession this year. Are we appropriately pricing that risk . George we are nowhere pricing any sort of assessment risk. Some of the lingering concerns are captured by both your viewers and investors. It has been a weak recovery all along. You couldrstandable call it bad blood in the sense people feel betty they have been left behind. George that is right. The bond market has been quick to figure these things out, faster than the equity markets. The bond market has been skeptical. Type tradereflation has created a diversions between bonds and equities in the last 20 years. Usually the bond market tends to be right. Were at a key inception point. What is happening here is pivotal, in our view. George, if the First Quarter is a blip the fed will overlook, it puts the burden of proof on to data. As we look ahead to the u. S. Jobs are poor what numbers do you have to see to support a june fed rate hike . George anything near consensus, it is accommodation of adp labor stats have been relatively robust. Of fed have a lot speakers that characterize what their interpretation is after the numbers. Messaging is out there, the data has been ok. Anywhere between 160 to 200. 200 is fair game. The weakness in the q1 is spilling over further. That takes away possibilities of the fed hiking in june. Yvonne not everyone is convinced this is transitory, right . We seebout breakevens, renewed pressure. Now the commodities story is racing down as well. I want to pull up a chart and show what we seeing, not just with energy, but industrials. Precious metals have been rolling up. How do you square this type of weakness and commodities with your view that rates could still go higher . Ultimately, there can be moments where we have soft patches. It could be regionspecific. Some of the weakness is starting to show up in china data and that is what is driving the commodity story, not a global phenomenon. Itthis were to persist, causes us to question the european recovery. And is the u. S. About to take an into a further leg of eight years plus recovery . We are watching the breakevens very closely. We have to hold above 175 on the tenure to keep reflation trade alive. Al of these, commodities are stealthy reminder that it is not recovery globally. Yvonne george, great to have you. Head of americas fixed income strategy joining us live from new york. Taking on the global top two. Can china clip the wings of boeing and airbus . This is bloomberg. Betty this is daybreak asia, i am betty liu in new york. Yvonne i am yvonne man in hong kong. Achieved generating Profit Margins to rival apple, in an industry where doubledigit earnings are remarkable. 29. 5 of sales in the First Quarter compares to apples 31. 6 profit margin. Is peers do not even come close. Betty rollsroyce has a new shorthaul jetliner from boeing. Rolls has been looking to get back into jets since it quit the market six years ago. They are working on middle of the market planes. The jet is likely to be named the 797. Is expecting less competition from international rivals. They see overseas carriers increasing capacity by 5 in the fiscal second half, compared to 11 in the first half. It will not be enough to lift fullyear earnings. Qantas expects underlying profit before tax of 1 billion. That is down from a record 1. 1 billion last year. Chinese aircraft mayor has thrown down the gauntlet to boeing and airbus. Today is another step forward. The Maiden Voyage of their first 919 to competee, c with the boeings 737. Lets take a look from sydney. How big of a milestone is this . It is a big deal for them. Out,hing we have to watch the intended customers of this aircraft do not seem enthusiastic about it. Look at the a320. 570 at thenly moment. Thoseantly, almost all of are Chinese Airlines and lessors. Ones one isre making engines for the c919. Even among Chinese Airlines, they are buying the minimum order. , comef the orders, 3 4 from lessors. It is a different picture. Betty may be airbus and boeing are still getting it right . I want to pull up a chart that shows the stock price of airbus which has increased twice as fast as the benchmark in france. All of that in anticipation of some of their orders and air traffic, which i am assuming is why they wanted to bring this plane to the market. Our boeing and airbus doing anything wrong here, is there any market share to give up . By 2024,bear in mind china will be the biggest aviation market. C919. Ves a bit to the the are not keen to give it up. Investors and boeing are not worried about the c919. It is decades old technology. 1980s plane. To a estimate, but maybe it burns 1 3 more fuel than the a320 per passenger kilometer. It is not a competitive product. Especially in a market that has been suffering yield declines in ticket prices. You do not want to buy a plane that drives up costs and fuel. Yvonne real quickly, what can they do . We talk about the technology being 10 years old. What can they do to gain the trust from airlines beyond china . Big deal, getting this beyond china. Previous big check, a smaller passenger jet than this one, they had their maiden flight in 2008. To fly in Foreign Countries you need a special certificate. It got its first foreign flight certificate last december, eight years after its maiden test flight. And that was for the republic of congo. It is quite a long road to getting this approved for flying outside china. That is the real challenge. Betty thank you. We have one headline from the trumpturnbull meet yvonne 7 30 a. M. Friday morning as we wrap up the trading week. Is 7 30 p. M. Thursday here in new york. It is getting later and later as we head toward the summer. I am betty liu in new york where markets are dragged down by oil prices. Energy shares the worst performers. Yvonne i am yvonne man in hong kong. Lets get first word news with courtney collins. First up, australian Prime MinisterMalcolm Turnbull prepares to meet President Trump, it seems he is echoing some of the u. S. President s rhetoric at home. Next weeks federal budget is expected to contain and Infrastructure Spending splurge as mr. Turnbull attempts to appeal to voters with the nationalists, nationbuilding policies. It will likely see the deficit expand. Wto has upheld australias right to import packaging on tobacco products. A dispute panel agreed at introduced in 2011 are legitimate Public Health measure and do not violate trade deals. They could usher in a new wave of restrictions around the gore around the world. Suisse says it could swallow up half 1 trillion. Beijings drive for influences more promising the President Trump pulling back from global engagement. The bank says most money will flow into india, pakistan, egypt, russia. Williggest beneficiaries be midsized construction and machinery firms. Philippine president Rodrigo Duterte called his chinese counterpart this week at the behest of washington to discuss chinas role in reining in north korea. He said President Trump asked him to find out if beijing to do something about kim jongun. Duterte told president xi he can help with tensions around the korean peninsula. The bond market states three socalled repo squeezes were some of the most traded bonds of became unavailable. The state bank of india says more discipline is required. What needs to be done, there needs to be more discipline on both sides. Both in respect of those bankers shorting the market. If they are doing shortterm speculative gains, we need to know why. Investors in the market need to go ahead and lend. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. I am courtney collins, this is bloomberg. We are counting down to major market opens here in the asian pacific. For more lets get to adam haigh, joining us live from sydney. We have the u. S. Jobs report later in the u. S. And the what else are you watching for this morning . Adam oil, an extension of the route we have seen in commodities earlier in the week. The bloomberg commodities index is down to an eight month low. The assessment investors are making around chinese Economic Growth is feeding in here. Some people are dialing back some of those china Growth Numbers for this year. Getting quite pronounced with that big move in oil and copper. And a big selloff in iron ore yesterday. The yen isexchange, relatively well supported here. A bit of strength overnight. But the yen is still weaker over the dollar for the week. So there is no rush to safe haven. Equities are holding up reasonably well this week. We ended the week for e