Gazas ruler rebrand as the isisrael says the manifesto not worth the paper it is written on. It is 7 00 a. M. Here. 5 00 in london. This is Bloomberg Markets. Shery ahn in hong kong, it is midday. You have lost a good interviews coming up. Tell us about them. This is the heart of saudi arabia. A lot of excitement around the country in terms of it opening up to Foreign Investment, making some of the big changes. Vision 2030 has been part of that and tries to wean itself off its dependency on oil. Happeningt what is with foreign participation in the stock markets. That has not picked up as much as expected. Bond,ok at demand in the two very different stories but ultimately what we will be doing is continuing to talk to the movers and shakers on the ground on the sidelines to get a better sense of where the story goes and how investors can of further tap the opportunities. For now it looks like a pretty optimistic today for investors in the market. Take a look at the function on the bloomberg and you can see most equity markets are back here in asia. They are gaining ground. We had a cpi on year of missing estimates, accelerating to 1. 9 via just briefly topping its previous record. When it comes to the currency market all in the green. We are seeing tech currencies gaining. Whenever earnings out of Tech Companies in the u. S. Respondent sentiment firmly there. The bond market, u. S. Treasuries continue to fall. I have to say they are clawing back some of the earlier losses. Australias bond market in the red head of the policy decision coming up in 30 minutes. Yousef equity future just glancing at them. In terms of what is happening in this part of the world, they have more and more corporate earnings. On the imac function, a breakdown. You will see strength in particular sectors. Properties as well, Consumer Discretionary stocks. Txt entertainment as well. There were downsides from financials and industrials. Volumes were up a notch compared to the last trading day. A quick note on egypt, the risk crude down to a onemonth low. Rising gasoline inventories being weighed against the declining inventory. High, april 7. Chinas Steel Industry steadying there. Tightening once again over treasuries and south africa relatively resilient in this equation as the Political Risk continues to be important. The first wordet headlines from around the world. Trump has told bloomberg he is actively considering breaking up wall street banks, reviving a discussion of a depression era loss of consumer and Investment Banking. He may raise the gas tax and be willing to meet kim jongun. The ministration has reported a 21st century version of the glasssteagall law. President trump we are looking at that. Were going to look at that. Were looking at it right now. Be verynk is going to seriously changed so the banks can go back to loaning money. President trump said he would be willing to meet kim jongun under the right circumstances. He said it could happen at an appropriate time although his press secretary said conditions are clearly not right at the moment. North korea has become the most urgent foreignpolicy issue facing the president during his first 100 days in the white house. The Palestinian Group hamas is trying to rebrand itself and has called for the destruction of israel. The islamic nationalist movement rather than the branch of the muslim brotherhood. A more pragmatic program to designed to end years of isolation. This is what we believe. Hamas is against all kinds of radicalism or religious intolerance. We underline that hamas believes the conflict is not a conflict against jews because of judaism. Hamas is not fighting against jews because they are jews. Hamas is fighting the zionist occupiers. The more moderate comments as misrepresentations saying the groups actions are still dedicated to war with israel and the manifesto is not worth the paper it is written on. Egypt has yet to get any reaction. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries i am deborah now, this is bloomberg. Thanks for that. Arab session coming through with a 1. 5 billion euro. This is a company that has been undergoing radical transformation. Crazy volatility. Lets cross back to the Saudi Arabian story. Very interesting what is happening here. Latest news coming from the billionaire. This is the family that runs the nations biggest conglomerates. The Financial Advisor for the shale the sale of some of its assets. International but they managed 5. 1 of Credit Suisse group as well. Lets get more perspective on what is happening in the ipo markets. The ceo for jpmorgan. Thank you very much for joining us on the show. We have seen since the beginning of the year, which companies considering ipos. This development, put some context for us to those of you not ipo developments. We are excited about the prospects of more ipos not only in saudi but in the broader region. We obviously have the government agenda off trying to privatize companies and create a private sector. Also the private sector is going to wants to take advantage of what is undoubtedly an increase of investment amount in the next two years. What big role are you playing in this . Will you do the same . We dont talk much about deals we are working on until they really are out in the public. I think we have been here for eight years. Think bank of saudi arabia has been here for many, many years. We expect them to play a pivotal role not only in the m a, but financing. Doubled theirst fees in the middle east last year. Where do you expect the bright spots to be this year . I think debt has always been a big driver of opportunity for banks. We will see a similar year to last year in terms of volumes. Weve already seen very keen market deals as the saudi arabia deal. Inmate will be quite buoyant. Looking to pick up efficiencies. Booming it was not needed and now people are looking for the efficiency. Domestic investors are looking to expand and diversify. Have a growing interest in investing in the region. We want to talk about the sales in the next few minutes but lets talk a little more about saudi arabia. There is an announcement of privatizing government assets. Do you expect to see more on that front . What about corporate earnings out of the economy . It is crystallizing quite clearly. We have heard quite a lot of names mentioned whether it is the grain silos, a lot of Infrastructure Projects will be privatized. That is very buoyant. Have regular results but very international. Investors are looking for a baseline with respect to oil and consumer behavior. That is gradually becoming clear. Earnings happens the perfectibility will become much better. It has been workable to see the recovery in those rates. We put this on the bloomberg, how that compares as well. In terms of what that means for the banks, research after research after researching the last three weeks in the amount of sentiment toward banks have been short nothing short of markable. How much more momentum can we expect . Hashe position of the bank improved dramatically and you see that reflected. In incredibly healthy cap stash sector as much as 17 . Outstanding job in keeping these banks focused on the mystic market. Thatnk that is a sector once the economy starts to grow again, they will benefit from that. I think people do very well. Yousef plenty to get through. There is a key inside right there. Will be back with jpmorgan ceo. Now, our viewers can get a roundup of the stories they need to know to get their day going and that is on todays edition of daybreak. It is also developed best available on mobile. You can also customize your settings. So you only get news on the industries and assets that you care about. Hourg up in the next half we break the latest decision and the reaction from a bond market veteran. Ultralongts on the bond floated by Steve Mnuchin. More with the ceo, the outlook for m a in the region. This is bloomberg. Yousef this is Bloomberg Markets medleys. Sophie signing a deal with a units of air india for tenant regional jets. Dubai Aerospace Enterprise provide 10visas to aircrafts to the delivery for the remainder of this year. The twin engine turboprops will be used to grow alliances as part of indias plan to boost regional error access. Libyas 1. 5 ilion dollar loss begins in london. Six months after the similar suit against Goldman Sachs was thrown out. Fighting to recoup billions of dollars lost on deals souring during the Global Financial crisis. Intimidating them into entering 2. 1 billion. Meeting bhp shareholders are doing a major overhaul. Bhp and the of Investment Team including the head of the office are laying out their planned changes to other shareholders including spinning off bhps oil assets and combining in sydney and london in one base in australia. Theef lets get back to guests. He is the ceo for the middle east africa and turkey. Story, unless the the government here has been able to stimulate investor influence in saudi classes. Story, we put the this up on our charts for additional contact. In terms of the net floor and where the that is not authorities would like it to be even though they were hoping as of late fall last year when they started making some of these changes that was going to stimulate. What is going to be the next catalyst . What is Holding Investors that . I agree. Out of sync with what we would expect for the largest economy in the world. Im quite convinced it is going to happen. The liberalization of the market in terms of accessibility. I think they are getting there. It is why the msci inclusion is very much talked about. We dont necessarily have to wait for the inclusion to see foreign interests in the market. I think a lot of investors when judge other situations where markets include the msci, the buying started a year well ahead. Im very hopeful those two factors will drive interest in yousef in terms of capital market, do you expect 2017 to be a better year than 2016 and how many mandates have you secured so far . It is the easiest to do. It is also the easiest to buy. You want to get your money back at the end. Thats why we see unbelievable demand. For 23en in this market years. Ive not seen that sort of demand. It underscores the demand is there for this country. I think they will have to continue to borrow but as the deficit decline, the volumes will come up. Would expect it to trail off a little bit. The catalyst for many of these sales was the crash in oil price. With the oil price stabilizing around 50 per barrel, will we see the necessity wane for some of these . Yeah. Most have expressed the desire to close deficits. Countries, they are not the day. They will be able to close those gaps. I think therefore the need to borrow will naturally diminish. The corporate sector will replace some of that supply. You also talked about m as this year earlier. Where will people of business come from within the region when it comes to m a activity . I think it is broadbased. When oil was at 100 and it was growing 5 , people were very much focused on taking advantage of the opportunity. Now with the oil at 50, growth in the low 12 , people have to find different ways to grow and diversify. M a is a way to eke out toiciency but they need expand their footprints. I think we will see in words m a. I think it was a good example of investors internationally wanting to take advantage of the opportunities that this region provides. Think he so much for your time mark stick around. Were coming back to you. Coming up, a problem of plenty. What cant opec due to boost prices as u. S. Drillers pump up the volume . We discussed that next. This is bloomberg. Anchor most markets across asia kicking off their trading week in the green. Juliet has the details. Coming through across the asia pac region, markets coming after online online after yesterdays holiday. The hong kong stocks and Mainland China stocks. A 2015 hig rising to amidst the rally we have seen in most asia pac markets. By. 9 ,the gains getting very close close to the previous record high. The ftse looking very strong. Is a littlemarket weaker down by. 5 . A look at the market you are seeing a lot of these emerging markets currencies continue on their recent rally. Peso rallying very strongly and the south korean of lawn leading these gains in asia despite all the concerns about geopolitical tensions. I want to show you another currency, one of the major ones. That is the aussie dollar. We await the rba decision. No change expected to the 1. 5 rate. Testould see the aussie that moving average of . 76 if we see hawkish commentary coming through. Thanks. Trading lower. Softer in concerns about where this is all going to go from the opec of view. What is happening with the saudi economy, we saw this uturn in some of the fiscal austerity measures. Jpmorgan for the middle east, africa, and turkey. Thesey your thoughts and changes. The reversal and some of the measures. Was it necessary given that he just started on these measures . What is it going to do to the saudi Economic Movement . Madefeel that a lot i been on reducing the fiscal deficits. We will see that this year. Broad package including cutting some of the allowances, introducing fees. I see it as more calibration of some of these things. Not everything works necessarily the way you expected. It may not generate revenue you expect. We should not take on this month to save they are changing course. It is a calibration. As far as i can see and the results of the First Quarter suggests we are well on our way to reduce the deficit meaningfully. How will the ipo of saudi aramco play into saudi arabias efforts to support the oil prices . Were seeing opec is extending cuts when they meet in may. I think the ipo of saudi aramco has a lot of benefits. Im not sure it will impact oil. Whatrtainly will display is in Unbelievable Company to the world and crystallize the enormous wealth in this country. We always look at the financial reserves but this is the other big reserve they have. Underscore how wealthy and well endowed this country is. Were looking to the opec meeting and the extent of possible extension. When you look at global inventories, where the price is right now, where is your base case . For me, oil is a story about american innovation. When we look back a few years ago we saw the cost of producing was much higher and it really showcased americas ability to innovate. It has driven the cost of producing in the u. S. Down as low as 30 but on average around 45. We think that will form. But because of the inventories you refer to we do not think it will go much higher. The 4555 ranges our best guess. Covering the middle east, africa, and turkey. Thank you very much for joining us this morning. We have been looking ahead and will be covering the policy decision. This is bloomberg. Shery ahn the cash rate policy decision. In sydney for the latest. Reporter im sure you want the police bit surprised when i tell you they kept the cash rate on hold. Waiting on a few lines and dropping out. Unchanged policy consistent with Economic Growth is the line we should all be remember familiar with. It makes an appearance in pretty much every statements. The same Australian Dollar would couple made cupcake it and the inconsistent with meeting the target overtime. The gradual further increases underlying inflation. That is important as well. , we are past month seeing the inflation rate creep back into the target band of 23 . Only does it 2. 1 . The aussie dollar now, the bank also mentioned. Not a great deal change. Trading at 75. 4 right now. Is premature old headlines we have from the reserve bank of australia. More will be dropping over the next few minutes. Remainste change unchanged at 1. 5. Shery ahn think he so much for giving us the latest on the rate decision. The managing director of kapstream, thank you so much for talking to us. Not surprised whatsoever when it comes to the cash rate being kept study. We are hearing that the policy unchanging is consistent with meetings meeting the target overtime. Inflation numbers of course in recent days. ,iven what the rba is facing Inflation Numbers but also having to maintain growth when the housing boom continues, what are some of the key things we need to be watching out for in the coming days . Thanks for having me. I dont think it was any surprise at all that they left rates unchanged. The last time they moved rates was in august 2016 so they have been on hold for almost nine months at 1. 5 . Earlier,ntioned inflation slowly starting to creep up. It is at 2. 1 . The biggest concern Going Forward is going to be the low Interest Rates. Into theof that feeds Housing Market and how much of that do they start worrying about going into Investment Properties and housing booms . The banks look like they are making adjustments on their own. Think they are in a good spot i dont think they go anywhere in the next few months until the end of the year. The rba right now saying the growth in housing debt has outpaced the house income growth. There talking about the economy being little changed. Lets look at the rate differential. Hadralia has historically to offer higher Interest Rates to attract Foreign Investors. If you take a look at the bloomberg, our viewers can see the rate differential between the 10 year yield and the australia 10year has shrunk below 30. This is actually the tightest in 15 years. How much pressure will this put on the aussie dollar if Foreign Investors do not find the markets attractive . It is interesting. I think youre right. Australia pays a premium. 30 is the lowest end of where it should be. If you simply think about some point the target fed funds rate will get to 1. 5 . Vas 1. 5 . Inflation in both countries and the u. S. And australia is roughly 2. 3 . Then the question is how much liquidity premium y