haidi: we are counting you down to asia's major market opens. of course we are watching the start of a very busy week for asian central banks as well as earnings. we are expecting holds across the board including the likes of new zealand holding their meetings this week. also getting air -- rba minutes as well as fed minutes. also a big week when it comes to earnings given the heavy discount and geopolitical tensions and the overcapacity claims at play. of course semiconductors will be front and center as we get those nvidia numbers. let's get you to avril hong who is in singapore for the market opens. avril: on those nvidia earnings it is interesting how we are seeing in the options pricing it seems to suggest investors not willing to pay that premium in order to participate in the rally of the marquee stocks.

we are seeing potentially that will be a driver this week. on the stock markets it is a bit of a mixed bag. we got some tailwind from last week after u.s. stocks eked out fresh records towards the end of the week. also that added left coming through from chinese authorities as they mold the proposed plans for -- to put a floor under the sector. and as we hear about how the pboc is going to come through with funding for state owned companies that have been tasked with buying up these unsold homes of distressed developers, that is something else we are watching in the asia-pacific as well. for now we are seeing not that much moves on japanese equities in south korea. a bit of a climb. dollar-yen moving towards that 156 level. of course something we have been watching in the l last week was the unwinding of the fed rate hike expectations. let's look at what we are seeing

in australia today. because we saw the asx 200 ending the week with declines. admitted a recovery. the aussie has also been in focus. that data out of australia prompting rba rate cut bets. we will keep a close eye on those minutes later in the week, tomorrow that is. we are seeing treasuries in the u.s. climbing. brent is also in focus after those fresh attacks over the weekend, putting geopolitical risk out of ukraine in the middle east in focus. we saw weekly gains just below $84 a barrel. haidi: let's bring in our next guest who expects the market turbulence we have seen to eventually moderate. let's bring in the strategist at state street global markets. great to have you with us. it still credits a great deal of

uncertainty in terms of how the inflation picture plays out from here and how central banks react to that. there is no consensus at this point in terms of when and if the likes of the fed will actually start to cut. yuting: definitely. given recent events, there is definitely relatively higher turbulence comparative a last few months. but right now it is more to your point, directionless a little bit, given that investors are pretty much now hugging neutral when it comes to holds and preferences. the issue is the anchor of the market comes down to the fed and a lot of the rates repression we have seen. and right now we see some cool off when it comes to u.s. data and a little bit of a better hold of the fed entering into the later part of the year. that helps entering market confidence a little bit.

on top of that we had over the past week more positive news on china as well. all these factors come to help anchor the preferences for risky assets. even though we have turbulence relatively higher in recent weeks, we expect those to moderate a bit from here. haidi: when you look across asia where you see opportunities? is it time for another leg up in a comes to japan? are you seeing more opportunities in adjacent south korea given the return of foreign inflows into that market? yuting: we are more conservative when it comes to the north asia space. korea, even though it has export benefit for the overall economy. there is still of the of concern around the overall china story

investors can use korea more towards north asia. we do still like india, given its relatively more stable growth outlook. so that is where we stand in terms of the overall asia space. haidi: what you like in india? because valuations are not cheap at the moment. yuting: right. valuation is not cheap at all but it is not as extreme as some of the other markets we are seeing. also in terms of the overall growth outlook it is quite stable. it is still a relatively domestic driven economy. in terms of geopolitics even know we still have the upcoming election currently happening, looking forward we still expect more market friendly reforms and policies. so that definitely helps in terms of the overall investor

preferences towards the whole india space. haidi: what about china? we have heard more incremental measures to support the property market. does that convince you it makes a pretty cheap entry point back into chinese risk assets? yuting: in terms of the overall china space what we think is what authorities have done, especially coming out of friday, it is definitely a move in the right direction. i think a lot of uncertainty still surrounds that in terms of the founding gap, in terms of how effective those policies are especially towards lower tier cities where you have a bigger disconnect to when it comes to the structural balance of supply and demand. ultimately what matters is how consumers or homebuyers perceive those measures and whether that changes their purpose -- purchase preferences. we are still concerned. we think growth is the right

move but more can be expected and more support is likely needed to have a turnaround when it comes to sentiment towards china. haidi: how much volatility are you expecting when it comes to geopolitics? obviously the middle east remains a source of tension. also heading quickly into the november elections. we are already seeing tariffs utilized by both sides. yuting: right. the middle east geopolitical situation is definitely ongoing. we do see commodity prices moderating in recent weeks. but as long as there is ongoing uncertainty in ukraine or serenity gaza strip, there is definitely elevated risk that things could deteriorate. when it comes to u.s. china relations heading into a november election, as we approach that to your point, geopolitical risk is likely to stay elevated. for the chinese side there is a certain understanding when it comes to a lot of these measures

or rhetoric heading into an election. in a way it is unavoidable. on the flipside, we have a lot more higher level and meetings we have seen the past few months. definitely a lot more compared to the fat -- past few years. when it comes to putting a floor on the relationship. there are definitely challenges going forward heading into the november election and a lot of uncertainty surrounding that. both sides at the moment does not want to make things too much worse from where we were a few years ago. so that is pretty much where we are at the moment. haidi: yuting shao, michael strategist at state street global markets. more to come. this is bloomberg. ♪

haidi: rescue teams in iran are searching further president after the helicopter he was in crashed. for more, let's bring in michael heath. what do we know so far?

the foreign minister was also on the same helicopter. michael: they were also some regional officials with them. it was a party of three helicopters. initially this of the president's helicopter had a hard landing. now it looks like they might be a bit more serious and potentially was a crash. this is a mountainous region. there is dense fog. there is a turkish drone trying to help in the search efforts and it is broadcasting purportedly on twitter and shows how dense the clouds are. it is very difficult to see anything. so it is going to take some time for rescuers to get into the site. that is all we have at this stage. he was returning from the neighboring stage of azerbaijan. they had open day dam on -- opened a dam on the board and he

was flying back from that when this reportedly occurred. haidi: this is a man who is widely seen as the supreme leader's successor. michael: yeah. this is the most important little issue. at the end of the day the ayatollah runs iran, he is the decisive voice when it comes to politics. but he was said to be groomed to take over the role. he is in his early 60's. it was a natural next step. if the worst has happened and he has died, it potentially throws secession plans into doubt. still at this stage we are speculating because we don't know what the situation is on the ground. but yes, he is certainly seen as the supreme leader's man. he has been very tough, he has a history of a hard-line approach. two years ago when there was protests in iran, when a girl

died in custody after being arrested by the morality police, there was quite a severe crackdown and historically he has been involved in quite a few crackdowns. haidi: iran's opponents and partners will be watching this closely, particularly israel. michael: the white house has said president biden has been briefed on it. israel would also be looking at it. it comes at such a serious time in the region given that iran just undertook its first barrage against israel even the most of the rockets were shot down. we have the gaza war still unfolding and we have netanyahu as well having problems. what it shows is when you brush aside the war we understand that even politically, the middle east is a very unstable place. haidi: that seems to be a fair -- there has been a lot of dramatic

positions being taken. is netanyahu's role in jeopardy? michael: my understanding is no. the opposition leader, israel has its normal cabinet but also has a war cabinet prosecuting the campaign against thomas. -- against hamas. israel traditionally does this when he goes to war. the opposition in the government unite. that worked very well initially but it has been breaking down from all sides in recent weeks. people are barely speaking to each other. the defense minister came out last week with demands netanyahu come up with a plan for gaza after the war. basically giving netanyahu an ultimatum for what he needs to see the next couple of weeks. that would not be great for israel but netanyahu hold a majority in the knesset. they just started their summer period of parliament.

after about july if his government lasts until then, it is on the -- unlikely and elections would happen until next year. haidi: you can of course get the latest on what is happening in the middle east and other stories you need to know in this morning's edition of daybreak. terminal subscribers can find that at dayb and on the mobile in the bloomberg anywhere app. a big moment for global politics. lai ching-te set to be sworn in as taiwan's next president in a few hours. it will be closely watched for plans of how -- our chief north asia correspondent stephen engle joins us now. the key focus is how he addresses the one china issue. we have not heard a great deal so far. stephen: that's right. he will be sworn in within the next hour. at 9:00 the inauguration ceremonies will begin outside --

actually the swearing-in will happen inside. he and his vice president candidate, taiwan's representative in washington, d.c., she comes with a lot of foreign experience and credentials. it will be a continuity candidacy and presidency with lai ching-te taking over. he was the vice president. he won the election but it was a three horse race divided by three ways. he did not win a very strong mandate at all. the kmt got 33.5%. then there was the wildcard candidate tpp that won 26.5%. maybe more importantly in the early days of this administration will be the divide in the legislative yuan where the opposition took one more seat than the ruling dpp.

we will talk about that in a little bit. the big issue as you alluded to will be the cross strait relations. we will give a speech today that will likely talk about reaffirming the status quo in cross strait relations with china at a time obviously beijing is watching this closely. they have labeled lai ching-te a number of different things and a dangerous separatist. they will be watching his tone and his word today. we have heard he is likely to keep on about being a continuity candidate. but bringing stability to policy here in taiwan. and there will be a number of guests but it is more like the who's who of world leaders. because look, no doubt that the pool of diplomatic relations and those who recognize taiwan as a sovereign state is dwindling.

since 2016 taiwan lost five different latin american nations to beijing including panama, dominican republic, el salvador, honduras, and most recently they lost the solomon islands. that pool of diplomatic allies has shrunk quite a bit. the list of dignitaries going to be here today includes the president of paraguay. the president of the pacific island of palau. and others including a representative from the vatican and a few u.s. guests including the former deputy terry of state richard armour taj. it is not the who's who, it is

the who,s "who"? as they maintain a status quo relationship. that is what they are at least trying to maintain with beijing. and not necessarily rattle the sabers but they are not engaging because they have not ascribed to the 1992 consensus which says we can agree that there is one china but we can disagree on what the definition of one china is. so it will be a very interesting day for sure to see lai ching-te 's tone after his inauguration and ton eo -- tone of his speech. haidi: we will bring you that inauguration as it happens. and we will get more analysis with our guests in taipei. other stories that we are following today, another big

political story we are watching, china investigating its minister for agriculture for what it calls serious violations of the law. he was appointed agriculture minister in december 2020. president xi jinping has spearheaded a sweeping anticorruption campaign since 2012, ensnaring dozens of communist party officials. saudi arabia and state media says king solomon is suffering from a lung inflammation. the official press agency says the 88-year-old monarch will receive antibodies at the palace after developing a high fever and joint pain. he has led saudi arabia since 2015. the illness comes with his son expected to travel to japan this week. more to come. this is bloomberg. ♪

haidi: take a look at how u.s. treasuries are treating. of course it was a big week when it comes to fed expectations and a lot of pullback when it comes to these concerns that the easing will come later rather than as early as markets had been building. barclays stitching a call to short tenure treasuries which has been one of the recent developments we have been following. some of the biggest bond market bears are ditching that recommendation. they say the shift in positioning is happening after the recent rally is likely to curb any rise in yields. we are seeing this bond rally built quickly on inflation euphoria. some of that globally for other government debt may face a bit more of a challenge. we have had global government debt seeing its best month of the year. of course the inflation print

from the u.s. showing some ebbing for the first time in six months, even if the details show the sustained fight against inflation might be trickier for the fed going forward. bloomberg opinion columnist and queens college cambridge president says the fed's delay of rate cuts to temper inflation runs the risk of falling behind the curve. he says it is the real economy, not inflation, that will ultimately force the fed to pivot. >> i think the big issue right now is that we as a profession and a market are two influenced after would happen from the global financial crisis. we still believe very low interest rates are the norm, not the exception. we believe that inflation is not an issue. so look at what has happened to the fed. the fed pivoted on the basis of data. it was the opposite of the pivot they did in december when they pivoted. now they have to do a u-turn. as they are doing the u-turn and

say higher for longer, the market is going to get away. he saw it happen to the two-year ended 10 year. then there are two really problematic issues we are not talking about enough. how sensitive are the stubborn components of inflation to interest rates? they are not very sensitive. that is problem number one. problem number two, when indications are be getting of the economy? it is slower and weaker. it raises the issue that once again the fed is going to have to pivot, this time not on the basis of inflation numbers, but on the basis of the real economy numbers it will pivot yet again. the big issue i know no one wants to discuss but i insist, i understand that fully, is the inflation target the right target? we all talk about wanting to go back to 2% every single quarter. everyone assumes 2% is the right inflation target. 2% is totally arbitrary. i understand why nobody wants to talk about this. but we should all realize if we

are pursuing the wrong inflation target, the risk of a mistake, and that mistake will mean sacrificing growth unnecessarily, the risk that mistake is high, especially when the low income people are most at risk. haidi: take a look at how futures in europe are opening up. we are seeing a solid set up in asia for the start of the session. of course we have had a little bit of that pullback expected potentially when it comes to certainly u.k. gilts and some european government bonds rallying alongside treasuries. this is the picture when it comes to the potential recovery we see in european stocks. muted upside for german dax futures. we had a lower finish for the european session friday. a little bit of a pullback in wall street, but still, certain markets notching record highs. the commentary from fed officials curbing some rate cut optimism. but those muted losses looking

like they will be back to gains when it comes to the start of trading in europe. seeing rate sensitive sectors and the likes of utilities and real estate in europe coming under some pressure. but some outperformance when it comes to consumer as well as banks. we had the luxury company jumping after some leadership companies. the ecb executive board member also warning that back to back rate cuts in june and july, that caution is more likely to be needed. a little bit of caution returning to the european markets. more to come. this is bloomberg. ♪ a slow network is no network for business. that's why more choose comcast business. and now we're introducing ultimate speed for business, our fastest plans yet. we're up to 12 times faster than verizon, at&t, and t-mobile. and existing customers could even get up to triple the

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♪ >> we are seeing markets trading

higher. let's get some details with avril in singapore. avril: seeing a tailwind in the asia-pacific driven by corporate earnings and the big one is nvidia. in the options market it suggests trade might ease. the other deal has been as of last week, optimism surrounding authorities doing more for the real estate market with authorities scrapping the mortgage floor for individual homebuyers in the funding plan for bank loans and how they will

mop up unsold homes. a lot of green, but something else is how we have seen the reality is it is low. haidi: part of the enthusiasm, is there any concern support measures are too little, too late? >> there are some parts of the market questioning whether they are coming in time, but also how they will be implemented if you think about the amount in terms of vacant homes and clearing up excess inventory, it is sung about trillions of yen, but the

facility will only help so there is a gap and how will this be implemented is a key concern. seeing how stock market participants have been exuberant about trading volumes last week. haidi: let's bring in a partner and chief economist. great to chat with you. at a time where this scrutiny has the downturn driving on. the package would only address a fraction of the properties in question so does this make a difference? >> hmm, yes, the market was

looking for substantially large indication. in a normal cycle it takes 18 months for one cycle so the market has about two years, probably more of outstanding inventory so if you want to go from 25 months threw two 18 months you need seven or 8 trillion. so with the special long dated bonds, some of the recent stimulus measures amounts to less than 2 trillion so a far cry from seven or 8 trillion, less than the market was in for the same time, the rally started since just before the chinese new year today, it has not got

much to do with the property package. the market was rallying so even though the package is small, there will be more stimulus on the way. haidi: our question of the day is how far will equities being lifted by these measures? this is not what the rally has been driven by so if investors are willing to ignore what is happening what are the forces driving valuations? >> yeah, well, everyone knows chinese market is cheap. it is not property that is

driving, it is the export sector. because of that people were focusing on overinvestment, overcapacity but the manufacturing sector infrastructure spending is driving the recovery and the consumer is lagging. see encouraging numbers, but the consumer is weak. if you look at the stimulus package it is 2 trillion yuan. if you think of the property sector being part of the consumer sector, very important part of chinese consumption. when buyer buy a house they buy

all new furniture, new car etc. etc. so it is an important inflation driver. consumption stimulus and property sector makes sense. on one hand you have manufacturing that is going banana. and then you're trying to divert stimulus back to the consumer sector and address international concerns. that way you get more valid growth rather than only having the infrastructure sector driving. haidi: i always enjoy reading your market views and notes. you talked about dualism and what is driving chinese risk assets.

where did politics fit in? we've seen tariffs maneuvered about mainstream talk, does that have an impact on china? >> um, i think, um, right now a lot of international attention is focused on chinese overcapacity. in the past two years china on from a car importer into a sort of one of the biggest car exporter of the world. it is cutting everybody else's lunch. so unavoidable really, you're getting criticism from europe and u.s. and you have all these tariff negotiation going on. inevitably of china does not do anything, you would sort of induce more criticism on how the

chinese government managing economy. we are trying to make a tentative stab to stimulate consumer sector and property sector while trying to rebalance the economy. so it is still early days because 2 trillion is far from being able to solve it. address trading problems with overcapacity, it is a balancing act. haidi: it's a question of what can china do because things like dvds, batteries, those are front and center. are there many options in the short or long term? they can produce more offshore like japan. >> that's right and right now

you are seeing chinese manufacturers in southeast asia in mexico. many auto parts are manufactured in mexico so it is a very dramatic change. also if you look at the economy the manufacturing sector. is making money but rental yield is less than 2%. long dated treasury bond is yielding lower than the risk in the market, if you continue to sink more money you are not going to get a good result. i would rather see the government putting money in the economy to generate decent

return. haidi: always great to talk to you. china started an investigation into plastic as the state media warned beijing would take countermeasures if the european union continued investigations. stocks in the fast-growing industries are falling prey to trade tensions. our asian stock reporter sa ng mi joins us now. how are we seeing investigators navigate this landscape? >> the new tariffs were

anticipated, but what is in focus is the fact that this might not be the end because biden and trump are trying to show voters who can be tougher. the whole focus is whether europe will follow suit because new exports from china are consumed by europe, solar cells, ev's and lithium batteries. the u.s. consumes 0.2%, massive difference. traders are watching the moves and we've seen the although 1%

is going to the u.s., the u.s. is building factories that could be used to circumvent tariffs. when it comes to batteries see atl is in focus, they may have some upside because tariffs take effect in 2026. more purchases before that. the medical equipment true malaysian glove makers shares along with a korean company that produces latex.

these are interesting sectors. there could be volatility and were watching solar. there will not be a lot of volatility. haidi: what else he watching? >> he sector is property with new measures, easing of rules and more measures. we will see how equity reacts on friday. we've seen the gauge jumping 10%. will be seeing how the market reacts. watching travel stops with trip.com reporting on tuesday.

seeing how the market reacts to first travel and spend. haidi: our asian stock supporter there. more to come, this is bloomberg. ♪

♪ >> china's ev makers are taking

long to pay bills, let's bring in linda lou. linda we are expecting lee votto and tell us what we are expecting in terms of numbers and the delayed payments? linda: for the earnings lee votto today, we are watching for how well growth margins hold up now that china has entered a phase of price cuts. lee votto was holding up ok. profit growth for this quarter. four x paul revenue is expected

to grow but it has not been profitable. losses are expected to narrow with ev makers taking longer to pay bills is showing pressure from the price war, they are trying to make cash stretch and manage liquidity. haidi: it is interesting, neo taking 295 days to clear receipts payable. how much pressure do we see and what does this indicate?

>> the pressure is expected to persist because there is no end in sight. with slowing growth and an uncertain outlook, compositional only get more fierce in the industry is under pressure. analysts said these will be passed to suppliers and the bigger suppliers will stretch out payments so kind of a flow where smaller players will take a big hit and consolidation will speed up.

haidi: linda lou there. star entertainment received interest from external parties but no substantive talks. let's bring in angus. what is the latest in terms of external interest? >> star has been forced to disclose several suitors have approached about possible deals after a report that a consortium made a takeover proposal and they are planning to take over target. according to the report they proposed injecting capital,

splitting casinos in sydney off properties, this is a breakup. haidi: what are the options available at the moment? angus: they're under pressure. you might remember sidney saying it was unsuitable to run a casino. they have not treated problem gamblers. it's been operating under a government monitoring. now it is in the middle of the second inquiry so that is not

clear what a buyer would get, it is approaching the lowest ebb, future is in the balance. the rival went through the same inquiries, bought by blackstone and they got a license back so a similar trajectory. haidi: there have been probes that are extraordinary and some strategies there. what is the take away? has the dirty laundry been aired? angus: that is all to be decided.

last week star told the inquiry it did not think it was suitable to run its casino and argued for its caretaker arrangement to be extended. we have seen remarkable testimony, chief executive and chairman plotting against the monitor in the company. there is a leadership crisis, not fit to run the casino and that will not be cleared up until we get that report back. they are waiting to see what the outcome is in sydney. with all that, shares have collapsed, their down, the company is worth less than $1

billion. haidi: our global business reporter. more developments through the day we will bring the latest to you. ♪ more ahead, this is bloomberg♪ .

haidi: live pictures of taiwan

ahead of the inauguration of the vice president set to be sworn in right at the heart of the rivalry between the u.s. and china. the current vice president will take his oath in taipei. this address will be the focus for taiwan watchers. how he will be navigating the complex relationship, he pledged to ring taiwan under control by force. a lot to contend with. a lot to contend with.

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