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tv   Bloomberg Markets Asia  Bloomberg  October 17, 2016 9:00pm-10:01pm EDT

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>> it's 9 a.m. in hong kong, midday in sydney. >> this is bloomberg markets asia. >> reasonable growth in australia. afterd: netflix surged hours, it's hit shows have visitors coming up, but asia remains a challenge.
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shares plunged on the news after the board met. rishaad: and rewriting the script in hollywood. an accused communist takeover of american movies. at what is going on -- james packer, crown results. of course, it hit his bottom line. 11.7%, close to 12% in a month -- in a single day, i think crown shares were falling 15% in a month. is this a renewed crackdown on ip gaming? is aad: we have seen this company that largely depends on the domestic australian economy for its business, but be sure price moves side by side with what is going on in macau. it's a bit inexplicable there. haidi: you talk about the
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it couldgambling, and -- est they are we did not see that with the mattel players as well. rishaad: it could be rotation in the sector as well. there we have it. theinutes to go before start of trading in china and hong kong. haidi: yes, that's right. let's see how those markets are tracking. >> yes, just to the d-up on your point -- talking about crown -- what happened yesterday, the reason i bring this up, the biggest decliners, you can see, if you believe morgan stanley, for example, which came up with a note this morning, they are saying the decline in stock price was already a bit too much given that -- you are pricing in a 12% or 18% chance of polling
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of the ip business from the company. they are saying it's a bit too much. it might be buying opportunity, of course. course, we see the dollar is on the back foot. the other thing i want to mention is palm oil prices. we don't track this a lot, but have a look at what we have done here for palm oil prices listed or traded in malaysia. up 25%. on the start of july. i think we have a graphic that shows that. that up their pleas. an absolute tear up late. 20%. there we go. this is something to watch. something to watch. that tends to move the market quite a bit. you look at what is happening across asia. and you seeviction, the chart. the way the asia-pacific is done.
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now let's move things along. have a look at oil prices. looking at assets decline. we are looking at the golden cross, reading the golden cross on the chart where you have the 50 day moving average. and let's have a look at what is happening -- where is my chart? no, i don't have it. at the point i went to make is really the broad-based decline in the u.s. dollar. .2260.und sterling at 1 haidi: all right, things for that, david. rishaad: and we have first word news with haslinda. rish, deutsche bank's it would welcome a smaller company as far as capital requirements according to officials. that may involve shrinking
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operations.. they are struggling with mounting legal costs. the low-priced clothing that brand gu one stuart half of its revenue from overseas in 10 years time. it also wants to double sales in the pan. their chief executive told bloomberg they will face on an expansion in china and southeast asia before moving on to europe and the u.s.. they also plan to open 100 new stores every year, including two in hong kong. >> we would like to see a total trillion yen and one years time. i believe we still have room for growth. >> we don't think that having
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the companies together will confuse our customers. there are more choices for our customers. traffic is busier when the two stores are open together. haslinda: opec is ready to cut its output. oil company said its figures were not acceptable. they are pumping 3.9 million barrels a day. they have already criticized the data which opec compiled from sources such as news agencies. authorities say a blaze broke out late monday and quickly spread to the intensive care unit of the building. initial suspicion points to an electrical short circuit.
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day- global news 24 hours a powered by journalists and analysts in more the 100 and 20 countries. a muslim diamond. this is bloomberg. thanks.s, rishaad: a drop-off in mining investment of bates. shery ahn has more on the minutes of the meeting. this was governor low's first meeting. what was discussed? right now we are seeing a lot to do with mining investment. that has to do with the headwinds in the drop of mining investment are abating and they will see expansion at a moderate pace. the economy shifting out of that investment boom. the rba minutes show they are considering new data and forecasts to help assess the
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effect of a prior rate cut before they move their next meeting november 1. key are considering a factor -- if you key factors. employment, although the thereion rate, they say is still considerable uncertainty in the labor and housing market. this is key because they say when it comes to the labor market, it is important to consider underemployment. fallingeeing employment to a three-year low. underemployment is rising. underemployment is at an all-time high. the housing market, a boom there. we were closely monitoring that before. they were making decisions on rate cuts. third quarter cpi next week.
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governor low -- it's strange saying that, isn't it? [laughter] rishaad: he is looking at inflation and defending the flexibility of the target there? shery: core inflation is very low, 1.15%. he says you have to consider employment. you have to consider financial stability. take a listen to what he said. abouthave never thought the rate of inflation between 2% and 3% all the time. doing something that is prescriptive is neither possible nor desirable. he causes environment a comes likes picture where you have weak inflation, weak fallingwth, but
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employment. there could be another round of borrowing while there are already heavily indebted consumers. it's a storyhaidi: we hear time and time again. shery ahn there with the rba minutes, the october meeting. rishaad: this is quite amazing. netflix -- it defied all of the estimates, does the? i think the share price rose something like 20% after hours. it's down to hit shows including "strange things -- "stranger things" and "narcos." haidi: we have a breakdown on this and the shows that have contributed when it comes to netflix's success outside the u.s. thister: absolutely and result is quelling the critics at the beginning of the netflix strategy. this was a stock that was down as much as 3% in the regular session, perhaps anxiety about the earnings after the bell, but
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the stock soared, as mentioned, 20% in after-hours as netflix announced that they added 3.6 million subscribers in the third quarter, and they were coming off a week second order. they were buoyed by the hit series, as mentioned, "stranger things" and "narcos," which by the way is a colombian drug lord story, very violent, and a big hit. in spanish, which is interesting. a global hit. netflix has dominated online tv viewing and yet they continue to deliver on this concept. thankstopped forecasts to the shows. they predict fourth-quarter growth that exceeds outlook and weak rebounded from a second-quarter. if this after the bell surge translates into a regular wall street session it could put the stock on a record track.
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so, that will be exciting to watch. back to you. rishaad: thanks for that. su keenan in new york there for us. haidi: china was the major doesn't limit when it comes to netflix. banned there -- rishaad: yeah, penetration there -- [laughter] haidi: baidu carving up the streaming market there. thesed: these companies, chinese complete, how much of the spending when it is coming to streaming? reporter: baidu announced they will spend more than 10 billion yuan next to her. that's a huge amount of money for a company struggling to make profits. it is all very strategically important for them to the extent that tencent's president says themit's unhealthy for already. this competition is unsustainable basically. haidi: why is this?
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ulu: it's all about the economy. alibaba -- if you look at the numbers -- a attracted all of the viewers. then online advertisements, gaming, all of these sectors they can go into the of the iseo platform, the traffic just very strategically important for all of them. some people have been categorizing this competition is unhealthy. why? what are they doing about it if it is unhealthy? if you look at the per episode cost for these companies, some go to hundreds yuan already. some say, why are we giving so much money to the content producers? why don't we produce them ourselves? that is what they are doing, producing their own wanton and working with hollywood studios,
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collaborating to cut costs. a normthat must be and is amount of money spent on that. lulu, thank you for that. still ahead, spreading its wings. we talked to an airline about whether there book now, pay later strategy is working out. rishaad: and we will look at the outlook -- that some away. ♪
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the scene at the moment in singapore, the trading day there slightly up -- the week -- actually the weaker dollar helping things in this part of the world at the moment, perhaps negating that negative day that we did have. we have some mixed data coming through from the u.s., of course, not giving much of a lead for asia and markets. the nikkei is flat today.
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yields just moderately higher. let's have a check of the latest business flash headlines for you. disney is said to have abandoned is pursuit of twitter over image issues. disney became concerned that bullying and uncouth language on the site could spoil its family image. they had gone so far as hiring jp morgan chase to evaluate a bid. twitter is losing money, but it is still worth almost $12 billion. rishaad: the british prime minister theresa may has publicly back to the bank of england, trying to counter perceptions of a division in policy. she says she is supportive of the governor and his leadership. earlier this month, there was a comment that some of the bank's actions of not helped voters. atdi: shares will be offered
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free, the equivalent of five dollars, making this the third-largest of this year. it is the third largest railway after the breakup of the state run japan railway. investors putting off taking risks ahead of the third u.s. presidential debate wednesday. let's take you to singapore now. -- sorry. go. haidi: standing by. we have the regional cio for southern asia-pacific at ubs wealth management. great to see you. ont is really playing investors minds this week? is it the third debate as we head into the u.s. election, or is it the china issue that is in this onslaught ahead of us. actually, it's both,
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largely. what is really in investors minds, the u.s. election. it's airily three weeks away. they are adopting a wait and see approach. clearly the markets are nervous about a trump when you are and if that happens, it will spoil the markets for is the next couple of months, if that actually happens. rishaad: just getting the yuan fixed where it was -- perhaps that is due to the weakness of the yen more than anything else, what you make of this trajectory lower. it does seem to have these policymakers in china in a bit of a conundrum. >> i think you can look at the export data the last couple weeks and they're coming in a lot weaker than expected. that is largely because global demand is still quite anemic. the central bank in china was a
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big problem -- do i weaken the yen -- but if i do that, i am clearly concerned there might be a pickup of outflows from the chinese economy and i don't want that. repeat of what happened in january and february this year. on top of that, you need to bear in mind with the u.s. elections around the corner, the rhetoric about china being a currency manipulator, etc., is likely to get louder and louder. about the concern of overflow and contagion? we have the data from china, all of these thomistic indicators, gdp. when you have a strong dollar, environment, are we setting up for another taper tantrum? >> yes and no. i think the potential rate hike has been largely talked about and should not come as a huge
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concern for the markets. basis, on a longer-term the federal reserve is likely to be slightly behind the curve. u.s., it isn the likely to be low or quite negative given that janet yellen has said she is willing to tolerate much higher inflation targets. we think that that is more or less to be at its peak. therefore i don't think it's necessarily that negative if the federal reserve hikes in december. if there is weakness, there is time to look at where the equity positions are concerned. rishaad: i was reading your note and you said why so negative in them and the ecb policies have pushed corporate yields down to the point where they are ineligible to be bought by the central bank.
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i think you gave the example -- i'm going to bring up the chart of the public transport system. point-minus five in terms of its yield, which makes them ineligible. >> absolutely. it has been a strategy that has not really worked out the way they wanted to be. you have a population that is asia and and you are sitting on dachshund andof huge amount there. it discourages from spending. now it's getting on from nothing, which is part of the concern. if you're 75, 80 years old, you're clearly not going to be .nvesting on a short-term basis the consumers actually come off very, very sharply. on top of that, negative
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interest rates have a really negative impact on bank earnings. next year, they might actually want to reverse and go neutral. the pressure on banks earnings are very, very unhealthy and it's forcing the pension funds and the insurance companies to take higher risks than is normally required. yes, not expected to change policy, but certainly a look at what they could do in december. thank you for coming to us there from singapore. shot at another hollywood. a chinese billionaire may be looking for another deal to dominate the big screen. haidi: we will have all of those details of next. this is bloomberg. ♪
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rishaad: you're back with bloomberg markets.
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i'm rishaad salamat. this is the futures contract on the hang seng moving to the upside. up withe trade coming 4/10 of 1% move to the upside. is slightly weaker on wall street, you would think that would be playing out, adding a bit of a headwind when it does come to equity action here, but this is probably what is responsible for the slight gains we are seeing in many of these in this these and that is a bit of the dollar weakness. and it's a little bit of a tailwind, if you will. kyle --hina's four and currency shares plunged, leaving --ders a reason to scribbling for a reason to explain the volatility. finalists in hong kong say that it's becoming increasingly worried about the depreciation and capital outflows.
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coming up next -- consumers have had a terrible monday hammered by what looks like a new crackdown from beijing. we will see how they fare at the open in hong kong. this is bloomberg. ♪
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haidi: this is "bloomberg markets: asia." i'm haidi lun. rishaad: we have this opening coming up in shanghai. fair to saynk it is we have been talking about the hot topic in china. it has come into the mainstream. as these debt equities get a companywe have seen that has been kept alive essentially in this cleanup.
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it is a question of moving those debts. that is what we heard yesterday, how you move them away from the banks and insurance companies. hassles arechinese not indefinite. anyway, shanghai and hong kong, starting their trading day. >> the hang seng and shanghai, getting underway. the official trip by the philippine president to beijing. the market is just about fla t. the hang seng come up by .6%. the pboc injecting some money back into the system today, roughly $12 billion here into the system. 40are looking at, i believe,
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billion renminbi, just to keep in mind. they are adding more liquidity back into the system. not a big surprise, just a mention, we did get slightly stronger fixing compared yesterday, given the drop in the u.s. dollar. have a look at the offshore renminbi. 6.7303, aking at slight uptick. we are following the drop yesterday. we are starting to see a rebound, though not quite enough to offset the 3% loss we saw yesterday. but still a decent session so far. earnings wynn macau earnings. now, we have three trading debuts in china today. someone call this a lottery.
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and well, there we go. i am not really surprised to see that happen. on lootom. a different day, the same story. she did get an ipo allocation. ?uys question i rishaad: rishaad: david, thank you very much indeed. lidi: let's look further into ootom. reporter: the minutes of the october meeting say the numbers are over on jobs and housing. the new governor today used a speech to defend the rba flexibility in pursuing the inflation target.
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netflix's hits as shows boost third-quarter earnings, adding more than 3.5 million subscribers in the period. it earned doubled up forecast. however, asia remains a challenge. netflix scrapped plans to launch in china this year, referring to licensed content. the u.n. said as many as 700,000 people might be forced to flee the iraqi city of mosul. andsands of iraqi troops kurdish fighters are advancing toward the city, backed by u.s. and coalition airstrikes. they could become the largest and most conflicted humanitarian situation in the world this year. an unnamed orbital rocket has blasted off from eastern virginia on a recent mission to the international space station.
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the program has been grounded two years. 30 first rocket blew up seconds after liftoff. that carry 29 pounds of supplies. the orbital's mission is under the contract with nasa. global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries around the world. is bloomberg. haidi: thank you for that. rishaad: the australian billionaire says he is deeply concerned about his crown resource employees, which are being detained in china. haidi: we have seen a crackdown this year on the foreign casinos, any foreign company really. we have the latest on the story from sydney. angus? angus: good morning, haidi. rare public statement
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from the shareholder billionaire behind crown resource. he has expressed deep concern for the welfare of these 18 staff members and he has urged the company to do everything possible to get into contact with them. we don't know if we have been able to contact the rest of them. he says he is respectful of the process subject to china's sovereign rules and its own investigative procedures. you could say there is not much other governments can do once their citizens are detained in china. it is up to china. you can make contact and support them, but there is a limit to what you can do. rishaad: markets are responding to that. and of course, the stock has moved on the downside, to put it mildly. that means, as we have
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discussed, a big loss for james packer himself. angus: that is right. yesterday was a record decline in crown shares, about $1 billion marked of wiped off thet value. james packer controls almost half of crown resorts. today, the market is trying to figure out what is the impact on crown's bottom line, on how it markets its gaming opportunities in the mainland. that really is what this is about. how do australian operators stay within the law? it is illegal to advertise to large groups of people anyway, gambling activities. this raises the question, of course, howcan crown's project stay within the law? ofis spending $2 billion australian money on the vip
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business. the market is wondering how this will affect the bottom line, as well as with the existing .operations in melbourne 1/3 of thet for company's revenue. rishaad: thank you for joining us with the latest on james packer. haidi: we are talking about the possibility of the crackdown on these regional hubs. we are seeing that sympathetic selloff. by .4%.s rebounded rishaad: galaxy is the biggest winner on the hang seng at the moment. haidi: moving on, the president is starting the first full day of his historic trip to china.
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rishaad: he is looking to bolster ties with beijing. tom mackenzie joins us now. what is on his agenda here, tom? reporter: well, president duterte is the first filipino leaders to be invited witfor talks with the chinese president. he is coming with a delegation of business leaders, ranging from a conglomerate selling alcohol and tobacco to business leaders. trade will be at the top of the agenda for him, but underpinning trade are the diplomatic relations between the philippines and china, which have been strained over the tensions with the south china sea. duterte has really been going out of his way to make overtones to china to try to improve those ties. he has even gone as far as saying he might downgrade ties
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with the u.s. military. but prior to his visit he told reporters in the philippines that he would not be haggling away his country's territorial rights in china. : we will noterte bargain any further. we continue to insist that the tribunal, the position will be taken up, but there will be no hard positions. reporter: clearly, it is a balancing act for duterte. he wants the economic dividend here in china, but he also wants to be aware of the ties to washington, and the public sentiment back home, where there is a lack of trust with china. haidi: tom, it opens the business bolstering ties. what kind of deal is duterte looking for on this visit to beijing? tom: clearly, china is a major
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export partner for the philippines. duterte will be looking to grow those exports. exports in the philippines have been down across the board for the last 17 months. they are very important for the foreign exchange reserves for the philippines. he will be looking for deals in the tourism section and agricultural products, think about the fruit exported from the philippines to china. he also wants to push to get chinese investments into some of the infrastructure many see as being below par in the philippines. his finance minister said he will be hoping for talks with the asian infrastructure investment bank in china. china says they are already looking at one dozen bills that have been worked out for this trip, and they go to see them signed off by thursday. rishaad: tom mackenzie there in beijing. haidi: coming up next, do you want to lock in an airfare before it goes sky high?
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well, there is an app for that. rishaad: i knew you were going to say that. we will be talking to the owner of gagfare, next. ♪
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haidi: this is "bloomberg markets: asia." let's check in with david. what is moving? stores in greater new china every year. that is the target, quite a big expansion plan. a little bit bizarre here. bacon potato pie sales are exceeding expectations. i am not sure about the taste, though. we're looking on some securities collapse.ofit we are following casino stocks in australia, for obvious
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reasons. we are seeing a rebound in those stocks. these two though, star entertainment and skycity. do you get back into the stock today? morgan stanley is a saying "yes." bothid priced in for company is 12% to 18% of the vip is in us. they are saying it is a bit too high. if you believe that not from morgan stanley, perhaps there is value to be made for both these stocks. very quickly, a check on casino shares here in hong kong. not quite at the levels of yesterday, but we will take a recovery in any form. rishaad: let's get a check of the latest business flash. globalia is opening ratings. it will see improvement when it's global reviews are made in
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december, they say. they are looking at a debt below investment grade. the governoment says it has the right mix of fiscal growth and policy that could be the right mix for sustainable growth. haidi: expanding into haircare. coty is purchasing the hair appliance maker ghd for $511 million. shares saw a slight reprieve, having fallen nearly 9% this year. rishaad: the chief executive and chairman will retire next year after six years in charge. in a surprise announcement, the company says he is being replaced by the president of the caterpillar energy and transportation group. his departure follows four years of weak performance.
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of course, this is down to the commodities slump, which hit the company hard there. haidi: plane tickets are headin ofkywards, ending the era cheap airfares. rishaad: at least you did not say "gaining altitude." but there is a way to get smaller prices for a fee. it is called gagfare. haidi: its founder is here with us now. i have to ask you about the name. is it a joke? >> a lot of people have been asking about that. p it will make you laugh. no, gagfare actually means get a good sale. rishaad: but you're not really competing on the price side. guarantee, you book now, you pay later and you pay $10 to
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do that. >> that is right. we saw the trend was changing with the online business. people like to buy stuff online. they like to go direct to the factory. but why can't a take it be the same question mark you can shop dreadfully with all the airlines. -- but why can't a ticket be the same? thecan shop directly with airlines. you can book your ticket for the easter holidays next year. rishaad: i have not done that, but i was not planning to go away. >> many people hesitated to book right away. rishaad: a travel agent can hold a ticket for you. what is the difference? >> every time you call them, that is a service. it is not in your hands. sometimes they push whatever fare that is available for them to you, and not necessarily what you are looking for. haidi: this is for the millennial agent that probably does not understand what a
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travel agent is. rishaad: i guess you would not know, being a millennial. >> people want to take control of what they are doing. when you're talking to your friends in a restaurant, you can pull up the app and see how costa trip to japan will and if it is good, you can book now. rishaad: how long can i hold the ticket for before i actually have to buy it? >> maybe, it could be a little bit shorter. rishaad: from where to where? >> from hong kong to tokyo -- rishaad: could they hold it for a week, or do you have to confirm this b 6:30 tomorrow evening. >> anywhere from two weeks to a week before yuou fly. for example, we are booking april right now.
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that take can hold for up to a week before your departure. for up tikcet can hold to a week before your departure. ticket can hold for up to a week before your departure. you might change your mind down the line. rishaad: or, you can go up on the web. >> you have already booked the bottom price anyway at this distance away from your departure. either way, you have the advantage. it is more bottomed price. you get rid of that two dollars booking. so, you have nothing to lose. haidi: where do you see the most interest? >> we have lunch this in malaysia, the philippines, hong kong.
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we have our softline in august. and we will be lodging in of october.the end we want to go into europe and america in the future. these guys plan longer trips. their holidays are bigger and longer. rishaad: very quickly, david. how did you come up with the idea, and why has nobody else done this? >> we have a studied buying behavior, and what the consumer wants. they want to book now and buy now. the situation now, in hong kong, only 10% were booking online tickets. last year, it went up to 20%. that is still a big gap there, but why hesitate? online you can pre-book everything. then, there is another person off-line who is able to serve
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you. we are serving both customers, the ones that want to book now and pay now, and the ones like yourself who want to book now, but have somebody serving you. rishaad: david, thank you for coming. >> you will become my customers soon. [laughter] rishaad: i don't have that app. i just got to the website. website did not come up on here, but that could be for a variety of other reasons. and founder.re's ceo haidi: another deal to dominate the big screen. that is up next. this is bloomberg. ♪
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rishaad: this is "bloomberg markets: asia."
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we are looking at the chinese billionaire with big ambitions. haidi: he is hosting an event in los angeles at the moment and is one of the biggest investors in hollywood. he is the to promote his new mega mvoga movie complex. rishaad: this is his grand plan, as it were. reporter: we are talking about metropolis he is building. he really is trying to build a huge global entertainment empire. he is speaking in los angeles tonight. he sees china's box office during 15% a year and he says that level of growth is sustainable. the company he is chairman of is up for a 40% rebate. ae metropolis essentially is
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$7.6 million complex. it will house the world's biggest moviemaking studios. there will be in a collision center, a hospital and a yacht club. the opening is being pushed back to august of 2018. he says this level of growth is a sustainable. officeas a percent box growth in -- there was 8% box office growth in china this year. not slowing down when it comes to this flurry of acquisitions. >> he has big pockets and he is ready to spend. a deal could be finalized by the end of this week. this deal could be worth $1 billion. this company produces the golden globe awards, and the american music awards.
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it is a production studio. but it is not one of the big six. wang jianlin has spoken qui often of his wish to purchase one of the big six. whether buying this production company will scratch that itch for him remains to be seen. rishaad: u.s. and really has been jumping here. reporter: this has some people concerned. bergman has talked about the "communist take over of our movies." he is campaigning to raise scrutiny regarding the security risks of the chinese in the and attainment business in the u.s. -- in the entertainment business in the u.s.
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quite controversial. we will be talking to the australian minister of trade and investments. ♪
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>> from our studios in new york city, this is "charlie rose." charlie: we begin this week with politics. with just 24 days until the election, donald trump has sent the republican party into crisis mode. the republican nominee's demeaning comments about women and allegations that he did more than just talk have offended the presidential race. joining me from washington, john dickerson, the anchor of "face the nation" and political director of cbs news. john, give me a snapshot of where you think we are on this friday night last weekend before the final debate. >> w w

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