Skip to main content

tv   Bloomberg Markets Asia  Bloomberg  July 19, 2021 10:00pm-11:00pm EDT

10:00 pm
billionaire's mission to space. >> the mission to space, absolutely but i think eight set them up for the various other benchmarks there. this is the responsibility here as well. >> this is where we came full-circle. the dollar moves have been a bit more calm. you see these stocks gaining a bit more ground. the worst may be over for asia. >> check in with these markets and here we go. not as bad as what we saw overnight on the street of dreams. definitely we saw the move to the downside. the hang seng withweighing in on market. looking at the nikkei with all of these movements surrounding
10:01 pm
the olympic games. let's look at these markets with a bit more detail. looking at china, we had the primary that was unchanged. we are seeking any kind of clues in terms of what they are next. there is that rrr cut that we saw. the shanghai market is down .6%. not much of a reaction there as the index removes the australian stocks. the hang seng, .2% lower. you look at what is going on with some of these other asset classes. this is a real head scratcher here. >> it is quite perplexing what has been going on. the moves and the pace of the drop in terms of the u.s.
10:02 pm
ten-year. we are still talking about 1.20%. we are talking about the 30 year which dropped more than 30 basis points in less than a month. i know we are talking about growth concerns but does it warrant a move like this? >> yes. but why do we have this going on given that we have a situation where people are talking about inflation and even if it is temporary, white have they got heals where they are right now? this delta covid variant goes on. it is really causing havoc around the world. we have seen that selloff take place on equities. it looks like a movie.
10:03 pm
it is the retail investor. retail investors by on that debt. we go and we see a recovery. will be see at this time? the jury is out. we are looking at this. every time we have seen these three presenters, people have piled in and they have been successful overall. >> we will see if they will get lucky because it seems like the narrative is changing right now. we are talking about central-bank diversions. that was the key focus. it seems like people are suggesting that the fed might take a little bit longer. the focus is back on, -- back on the virus all of a sudden. >> it is actually not consistent with the still booming inflation and also the economic recovery stories. >> every weakness is justified on a short-term basis.
10:04 pm
>> it will continue to be a very sharp support for the broader income markets. >> if you look at the issue of the delta variant in covid, it is a short-term concern. >> let's bring in the credit suisse. thank you for joining us. the question here and the question of the day is how far can this delta or care -- covid variant drive down these risk assets? >> good morning. i don't think this is a big concern for the market. we are not likely to see the lockdowns that we saw last year. eventually, people will learn to live with dividers. that will help in terms of the
10:05 pm
covid recovery. i think that the focus is on economic recovery, higher equity prices, higher asset prices. it is not going to be a concern for the market. >> the head scratcher is the economic recovery is in taxes than why our bond yields behaving the way they are and why are people piling in on gymnastics? that juice is getting more diluted every day it seems. >> apart from that, i think this has guided it toward it. this might lead to low inflation down the line.
10:06 pm
growth will eventually slow down and that is why bonds are starting to come down. we expect bond yields will rise. we are looking at one point, percent in 12 months. >> i know your looking at that a little bit more when it comes to rates rising. what about the yield curve? it continues to flatten. if growth is a big concern, wouldn't that be pushing back on this? what is your take on all of that? >> i think we have always seen the rate had -- rate hike expectations. i think as the economic recovery continues, especially in europe, we will see higher bond yields.
10:07 pm
again, each is different as inflation in the short-term remains high and economic recovery continues. >> how does this whole change in the backdrop affect it? it seems that you are leaning towards this a bit more when it comes to equities. >> you might see some blowback in equity prices based on the rally in june. investors have been complicit. by the end of this year, we expect equity prices to be higher. within the equity market, we are having cyclical sectors that are respected to benefit and those would be financials and materials. > you are talking about certain technical indicators
10:08 pm
that are pointing toward caution. you probably don't need those to realize you need to be cautious in an environment like this but what tactical indicators are you looking at? >> if you look at the market in the u.s., it has been very narrow. very few stocks have been driving equity markets higher over the last one or two months. that tends to be a negative signal for equity prices. similarly, the s&p 500 is close to 15% above its 200 day moving average. this is signaling that markets are very complicit. you look at the ratio that has been indicating investors are heading towards hedging their exposure.
10:09 pm
this is not the end of the market. i think equity prices will be bumped. >> ever grant resuming that the client after falling 60% yesterday. we are talking about seven year lows for the stock. the lowest is 2017. the latest news was the hunan province city had halted the company project sales. they alleged the fund was not properly used. here is what we are looking at when it comes to ever grant. -- ever grande.
10:10 pm
ever grande falling 13% right now. things are looking dire. prices falling below 1. it just goes to show a lot of questions about whether they can genuinely generate the cash at the moment. >> you have these levels on not just this indicator but we were looking yesterday. the bonds were worth $.61 on the dollar. it is not that much money in the scheme of things. they have to be seriously worried. we will revisit that story in the next hour or two. before all that, let's get to new york and join su keenan who has the first word news. >> we will start with the
10:11 pm
centers for his disease -- center for disease control. warning u.s. citizens not to travel to the u.k.. the travel warning is at the highest level. the advisory comes after england cost freedom day to mark the full reopening of the economy. data shows the u.k. added more than 100,000 new cases over the weekend. vaccine certificates are set to become a requirement. that is beginning at the end of september. boris johnson delivered the news via video link after he was exposed to the nation's health minister. sticking with the covid concerns, a famous u.s. gymnast has tested positive for covid during a pretty limbic training
10:12 pm
cap. the big officials declined to name the gymnast. saying that she was in her teens. this as cases tied to the game are on the rise. the opening ceremony is set for friday. an international -- and international monitors are growing concerned over and expanded nuclear program. iran insists it is still preserving data captured by the international atomic energy agency and that it is accurately documenting these activities. president joe biden has revealed what he told jerome powell at a recent meeting. the u.s. president told the fed chair the bank should take necessary steps to combat rising
10:13 pm
inflation and to ensure the economic recovery. president biden so made it clear that the fed is independent. >> my administration understands that if we were ever to experience unchecked inflation over the long-term, that would pose a real challenge to our economy. while we are confident it is not what we are seeing today, we remain vigilant about any responses needed. as i made clear to chairman powell at the federal reserve when we met recently, the fed is independent and should take steps necessary to support a global economy. global news, 24 hours a day on air and on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am su keenan, this is bloomberg. rishaad: let's tell you what we have coming up. we are hearing to buy indonesian stocks.
10:14 pm
and the outlook for other southeast asian markets up later this hour. >> we will look at china's monetary policy direction as concerned about a resilience of the global economic recovery grow. this is bloomberg. ♪
10:15 pm
10:16 pm
>> we are looking back to china. this is the 15th straight month. >> it is interesting. when they did not cut the rates back when covid was that in china, i guess now is another opportunity to do so. that is quite telling here on
10:17 pm
the direction of where the pboc will go when it comes to easing. let's bring in our correspondent. >> the authorities are not panicking. they are happy where the economy is. these are the main rates for mortgages and companies. there was news that maybe the pboc was getting spooked and are starting to support the economy but these rates have been on hold. they have been on hold since 2020 and the feeling is that things are on track. there is no doubt that growth in china may have peaked here. >> that is it. this is the whole thing about global growth. china is ahead on the cycle. they are ahead in terms of coming out of the pandemic. people are saying how long can it go on for?
10:18 pm
>> first in, first out, they the recovery would be first to slow as well. the consumer is an interesting story in china. that is happening in china. you have to ask yourself how the rest of the world will get back to where we were. i think there is significant uncertainty over china's recovery. >> this coming at a time when you're starting to hear central banks are leaning less dovish. does that change the picture for central banks? >> it has to raise questions. we have this crabwalk with the fed talking about tapering it, canada, australia, others hinting at tapering. the surge in infections is not keeping up with the pace of
10:19 pm
vaccinations. consumers won't be able to spend the way they would have been able to pre-pandemic. if the search continues at the pace it is, you can imagine how challenging this would be to the recovery. >> coming up, we spoke to the united states and the u.k. as they claim the chinese government for the microsoft change attacks. that is on the way, this is bloomberg. ♪
10:20 pm
10:21 pm
>> there -- they are still
10:22 pm
determining what happened. investigation is not finished. my understanding is that the chinese government, not unlike the russian government is not doing it themselves but are protecting those who are doing it and maybe even accommodating them that are doing it. >> president biden tying china to the microsoft exchange hacked earlier this year. their allies have formally blamed to china for that hack. >> rather than dismissing these accusations, let's find out more. here is bruce einhorn. so many big cyberattacks. it is really hard to say who did them all. and to keep track of them, some of them go unreported. i can't it remember what happened with microsoft but give me a sense, i can't remember. >> i had to look it up between them all. this one took place in late
10:23 pm
february and early march of this year. it targeted the microsoft exchange email service, health care facilities, manufacturers, state and local governments, a lot of others. microsoft pointed the finger at hackers in china. the u.s. says it has a high degree of confidence that assessment is correct. >> is it rare for the u.s. to come out and blame china for hacked selectors? >> we saw a lot of attacks. typically, we are seeing them blamed on russia, sometimes on other hackers from eastern europe, north korea. this is the first time the u.s. government has billy said we see china behind this. the u.s. has said we see hackers affiliated with the ministry of
10:24 pm
state security involved in all of this. >> normally they point to that facility outside of shanghai but they are not this time. they are also not the only ones pointing the finger at china. it is a broad front. >> that is significant. it fits in with the biden administration's approach. the trump administration tended to deal with china one on one and tried not to get allies involved as a group. in this case, we have not just the u.s. saying this but the u.k., the european union, australia, canada, japan, nato has gotten involved as well. pretty significant, abroad up of countries and organizations saying china is involved in this hack. >> china is getting increasingly isolated. the brazilian mining giant
10:25 pm
producing less iron ore than expected. the world's second largest producer turned out nearly 76 million tons during that period. valet is in a sector where demand remains high despite china's push to curb emissions. ibm reported the biggest sales in three years, beating estimates on the back of strong demand for cloud computing. revenue rose 3%. signaling that the pivot to the cloud is starting to pay off. he took over during the pandemic and since then, the company has gone on an acquisition spree, spending about 3 million to boost its cloud capability. robin hood is chasing a $35 billion valuation. they will market 55 million shares for up to $42 million
10:26 pm
each. robinhood planned to use -- raise 2.2 billion. that would make it the biggest exchange -- ipo on and if change this year. >> if we see all these retail investments buying on the dip as we saw every time, the s&p 500 declined by 3%. this could perhaps boosted the bottom line as well. that is what it is looking like. we are stabilizing after the lows of the day. that is the futures contract which we just saw as well. looking at the 10 year yield knew? the reserve bank of australia did not move the dial. there we go.
10:27 pm
the yen coming back in the last couple of days. just the american counterpart. a lot more on the way. you are with bloomberg. ♪
10:28 pm
10:29 pm
>> right here in hong kong. rishaad: trading to the downside as you can see, down, .4%. yvonne: markets are closed, they are taking a bit of a breather after what we saw yesterday in the selloff. take a look at what we are watching for, the u.s. treasury department said they have reached an agreement that will
10:30 pm
allow more flexibility in currency. more restrictions may be needed following detections of the more transmissible delta virus variant, anti-china plans to use more chinese made vaccines. the country kicking off a regime. rishaad: normally we would be checking in with markets, but they are off on holiday, and islamic holiday. looking at what is going on, shanghai on the way down. vietnam lower again. this is a market which was going gangbusters, up something like 21%. clearly able market. we are entering territory for correction, 12.5% we are down so far this month alone.
10:31 pm
that is something to look at with a degree of consternation. no clear reasons, perhaps too far too fast. yvonne: it seems like vietnam was relatively safer than most southeast asian markets when it comes to the virus, now starting to see some more restrictions. let's stick to the region. buying indonesian stocks? topping highs and hitting a new record. let's bring in citigroup's head about seann research. -- ossie on research. thank you for joining us. interesting to make a call like that in the face of the delta variant. tell us what is behind that call. guest: the indonesian markets have been underperforming in the region year-to-date, we will
10:32 pm
reduce the number of cases. so far we have seen in the past two to three days, cases have started to come down. we expect the government might reach -- relax the emergency restrictions. with that,, -- this is the standard deviation. we are expecting more recovery in the fourth quarter of this year when the economy starts to reopen. we are also expecting there will be more ipos.
10:33 pm
that should expect the market in our view. yvonne: we were talking to a guest yesterday about how the boom was going to be centered in southeast asia. where are we going to see the opportunities? guest: it will be more on the recovery spectrum. in my view, banks will be -- when the dust settles. some of the other recovery plays will be another one. some other property names. it will be a recovery story. those are the sectors that we like in addition to health care and tech names that will
10:34 pm
continue to remain strong performers in this quarter in the following quarter. rishaad: i know that the covid situation is one thing, but what else? guest: the other thing, more on government support and stimulus. so far this year, the government has not done much in terms of stimulating the economy. lester the government spent about 5% to 6% of the total budget for stimulus. this year, so far they have allocated about 1%. i'm expecting there will be more upcoming stimulus implemented by the government. this basically should reduce,
10:35 pm
increase the purchasing power for the middle to low income people. that is the other thing that we need to monitor in addition to other cases. rishaad: what about benchmark indices? how does that play into this? guest: the inclusion, and the past four years, there were about eight indonesian companies that were excluded, partly because there is no ipo in the market in the past four to five years. with this tech ipo, more upcoming, and the current digital banks, we are expecting it will be included. over the next year, i expect
10:36 pm
four to five inclusions in the index. basically from 2016 to now, the indonesian index in emerging markets has come down from about 3% to 1.1%, partly because of the china inclusion, coupled with -- coupled -- with this upcoming inclusion, i expect the waiting will increase. yvonne: i have to ask you. the valuation on this company is looking silly. it is so expensive. what does a valuation like that tell you? there are not many alternatives? is this the next big thing? guest: i cannot answer
10:37 pm
specifically, but in general, it is the first tech ipo in indonesia. the first e-commerce play. it is a demand and supply situation. we see the demand has been pretty strong. we will be doing 1.5 billion, but it's 6 billion demand. it is the first tech ipo in indonesia and southeast asia, practically. rishaad: good stuff. does it get to that point, have a look. is it overvalued? it is a much-anticipated ipo. looking at $1.5 billion
10:38 pm
thereabouts. yvonne: biggest in indonesia. rishaad: biggest ever up i think. a technology analyst with bloomberg intelligence joins us now. where is this all coming from? what measures are we looking at being overvalued, tech ipo's overvalued, who knew? reporter: we think they cannot justify the valuation. it is behind bigger rivals. each of these rivals [indiscernible] which is the total values. with a valuation of $6 billion on the top end, it's being priced at 200% premium. we believe this respects huge
10:39 pm
investor appetite for internet companies at a time where we have few alternatives. yvonne: why do you think indonesia stands out as an e-commerce market? guest: indonesia has the fourth largest population worldwide. what is interesting is indonesia has 40% of southeast asia digital consumers. these are people who buy online at least once a year. but it's interesting that 80% of the nation uses e-commerce. that means there are plenty of opportunities for innovative products. rishaad: what about the business itself? is that something which engenders optimism? reporter: much like other companies, they are expanding
10:40 pm
into digital banking services. they will offer indonesians access to loans, credit cards and saving services. longer-term it might live up to its high valuation due to his business model, in that second tier cities as well as serving the micro, small and medium enterprises which drive 60% of indonesia's gdp, yvonne: thank you. just talking about the slew of ipo's in southeast asia. the big one yesterday had a surge of as much as 60%. we spoke about the opportunities in the region. you have to wonder, the tech boom, is a southeast asia or is it india?
10:41 pm
rishaad: [indiscernible] yvonne: lots going on. su: starting with china which has rejected claims firenado and eu member countries blaming it for the massive cyberattack of microsoft exchange. beijing's du mission calls the claims ungrounded. that u.s. allies accuse china of a broad range of malicious cyber activities against public and private entities, including data theft and cyber espionage. the white house says it will take steps to counter any chinese activity. meanwhile, a rural union activist from a marxist party has been declared peru's next president. he was virtually unknown six months ago defeated a right-wing candidate, a leader of the
10:42 pm
country's most powerful political climb, winning by a narrow margin. the announcement comes after weeks of vote recounts and lawsuits prompted by allegations of fraud. meanwhile, the u.s. and vietnam reach an agreement under which hanoi will allow more flexibility in its currency. the understanding is a dispute including tariffs, after the trump administration labeled vietnamese currency actions unreasonable and restrictive. vietnam central bank says it does not use the exchange rate to create an unfair competitive trade advantage. credit chinese cities including beijing are warning of new power outages. this as historic demand and supply shortages strain energy grids. electricity users have been told to expect schedule disruptions in order to avoid overloading
10:43 pm
networks. china's state grid court says 11 provinces, including manufacturing hubs incurred record demand and peak searches, as temperatures go sorry. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. rishaad: what have we got? a summer of pandemic, global stock selloff, the delta variant is raising alarms. don't mean to be depressing. we have the latest on the virus. that is next. this is bloomberg. ♪
10:44 pm
10:45 pm
rishaad: we are back. the u.s. is warning people not to travel to the u.k. as cases search and restrictions are listed. they are saying it is an advisory. but they are really saying no. yvonne: more restrictions on arrivals from indonesia.
10:46 pm
we saw the situation, the strategy is stoking fears. rishaad: they had freedom day. some called it surrender day. does this go anyway towards herd immunity? yvonne: we heard from anthony fauci. here's what he had to say. >> among unvaccinated people, that's a significant risk. that is the reason why we are practically bleeding with people to please, if you are not vaccinated, seriously consider getting vaccinated. yvonne: now just days from the start of the tokyo olympics. on friday, another athlete has tested positive for covid-19. a u.s. gymnast with training in
10:47 pm
japan. let's bring in michelle cortez. what can organizers do right now? reporter: at this point, they are isolating athletes who tested positive with their close contacts. but there is rising issue about what these athletes are going to do. we know that we are going to continue to see outbreaks, more cases and infections in olympic village. it's going to be critical to keep those outbreaks under control to make sure it does not spread, but also give athletes the ability to perform and compete if it is safe. it is very tricky for japan and the other big organizers to decide had to go forward safely, isolating those if they need to in order to keep everyone safe, but not going overboard and curtailing the excitement. rishaad: people are just hoping
10:48 pm
it's not going to turn out like india, i guess, which is awful. reporter: there is an unbelievable outbreak occurring in indonesia. the thing is, it is devastating for the family and individuals grappling with infections. it is something the entire world needs to be concerned about. we saw what happened with india. not only the number of infections and deaths, but the rise of the delta variant. when we look at these outbreaks, it is creating the opportunity for the virus to mutate again and potentially evade the vaccine more than the delta variant had, and that will be devastating. already we are seeing the kind of damage the variant is doing in the u.k. and u.s..
10:49 pm
the concern is this is not the end. yvonne: given that, when you look at countries like malaysia, is the country opening to quickly? reporter: malaysia has kept things locked down substantially. now they are going to start opening up a little bit, because they are getting some vaccinations going. they are not throwing open the doors. they are going to have to be ready to take quick action if ey s seeing an increase in cases. the concern again is that delta
10:50 pm
variant. yvonne: we continue to follow all things virus related. ever grant is still a story. . the stocks plummeting for a second day. that is about a chinese city. more downside, more fear. rishaad: absolutely. a lot more on the way. this is bloomberg. ♪
10:51 pm
10:52 pm
rishaad: a lot i got later today. having a look at the markets. getting a take on the market. talking about the effects we are seeing from the covid variant which is ravaging parts of the country, we should say the region.
10:53 pm
looking at space, there is a space surveillance company. tracking space objects. how do we deal with the space rubbish? what we talk about space on a day like this, we can't not talk about jeff bezos. hours away from blasting off into space. 8:30 p.m. hong kong time, ed ludlow gives us a preview. reporter: if all goes to plan, it will generate 110 pounds of frost propelling them up towards
10:54 pm
the common line, as they approach, the booster will separate from the capsule. it will carry on to about 66 miles. it is not far enough to escape the gravitational pull. the capsule will start falling back down to earth using its own air resistance. there will be some drag that is fired. three large parachutes will deploy they sudden burst of air just before the capsule hits the ground. as of monday evening, astronauts have completed their training, but as always, whether as a factor. for blue origin it is a substantive step forward in what has been slow progress. jeff bezos founded the company.
10:55 pm
the launch site was not built until 2014. blue origin -- it wants to compete. it wants to compete with spacex but also builds engines. they have a grand vision of the future. first things first, and 11 minute flight for a few moments. -- four buckling back,
10:56 pm
expansion forces at five times the earth's gravity on the way down. yvonne: jeff bezos billing weightlessness. bond yields continue to have lower. this is bloomberg. ♪
10:57 pm
[ "me and you" by barry louis polisar ]
10:58 pm
♪ me and you just singing on the train ♪ ♪ me and you listening to the rain ♪ ♪ me and you we are the same ♪ ♪ me and you have all the fame we need ♪ ♪ indeed, you and me are we ♪ ♪ me and you singing in the park ♪ ♪ me and you, we're waiting for the dark ♪
10:59 pm
11:00 pm
announcer: from the heart of where innovation, money and power collide. in silicon valley and beyond. this is bloomberg technology with emily chang. ♪ caroline: caroline hyde in for emily chang. coming up in the next hour, we we head to texas where emily is at the blue origin launch site. find out what to express -- expect when jeff bezos heads to space.


info Stream Only

Uploaded by TV Archive on