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00:00> > THIS IS THE ASIA TRADE. I'M SHERY AHN IN TOKYO. > > I'M AVRIL HONG IN SINGAPORE. ASIAN STOCKS SET FOR A POSITIVE START AFTER FED CHAIR'S JAY POWELL -- FED CHAIR JAY POWELL'S DOVISH COMMENTS. A SLEW OF EARNINGS HEADLINED BY NVIDIA. INTEL'S ASIA SUPPLIERS AND FOCUS AFTER PRESIDENT TRUMP SEALS A DALE -- DEAL TO TAKE A STAKE. AND KOREA PLANS TO MEET WITH PRESIDENT TRUMP. SHERY: WE WILL BE WATCHING THE MARKET REACTION ACROSS ASIA DIGESTING JACKSON HOLE AND THOSE COMMENTS WHEN IT CAME TO CHAIR POWELL SIGNALING RATE CUTS TO COME. IT WAS A TENSE JACKSON HOLE PHYSICALLY SPEAKING EVEN. -SECURITY ON THE GROUND BUT ALSO WHEN IT COMES TO MONETARY POLICY COMING FROM DIFFERENT CENTRAL BANKERS AROUND THE WORLD. THE CHAIR CALLING THE SITUATION FOR THE FEDERAL RESERVE GIVEN THE U.S. ECONOMY PRETTY CHALLENGING. TAKE A LISTEN. CHAIR POWELL: THE STABILITY OF THE UNEMPLOYMENT RATE AND OTHER LABOR MARKET MEASURES ALLOWS US TO PROCEED CAREFULLY AS WE PROCEED WITH OUR POLICY STANCE. NONETHELESS, WITH POLICY IN RESTRICTIVE TERRITORY, THE BASELINE OUTLOOK AND THE SHIFTING BALANCE OF RISKS MAY WARRANT ADJUSTING OUR POLICY STANCE. AVRIL: WHEN YOU TALK ABOUT THIS TENSE SITUATION AT JACKSON HOLE, IT ALSO POTENTIALLY TRANSLATES INTO THE DISAGREEMENT AMONG POLICYMAKERS AND THERE IS ALSO PRESSURE FROM OUTSIDE THE FED. SOME OF THE COMMENTS FROM THE FORMER ST. LOUIS FED PRESIDENT JAMES BULLARD. HE IS OF COURSE A CONTENDER FOR FED CHIEF. HE IS CALLING FOR A HUNDRED BASIS POINTS OF CUTS. AND THEN MORE IN 2020 SIX. > > I HAVE SET 100 BASIS POINTS GOING INTO 2026. I THINK YOU COULD ADJUST AS YOU GO FORWARD AND EVENTUALLY GET A FULL 100 BASIS POINTS, BUT I WOULD GO SLOWLY TO WATCH THE DATA. SHERY: THIS WEEK WE WILL BE WATCHING CENTRAL BANKERS ACROSS ASIA WITH RATE DECISIONS FROM THE BANK OF KOREA AND THE PHILIPPINES. TAKE A LOOK AT HOW WE ARE SETTING UP FOR THE MARKET OPENS ACROSS ASIA RIGHT NOW. THE JAPANESE YEN HOLDING. THE NIKKEI POINTING UP. THE DOLLAR AND THE OTHER SIDE OF THAT TRADE SINKING IN THE OVERNIGHT SESSION, REACTING TO CHAIR POWELL'S COMMENTS. TAKE A LOOK AT HOW WE ARE SETTING UP FOR THE U.S. MARKET OPENS. WE WERE WATCHING U.S. STOCKS ON FRIDAY SURGING AFTER THE LONGEST LOSING STREAK SINCE JANUARY, BUT IT WAS REALLY CHAIR POWELL’'S COMMENTARY AND THAT SIDE OF RELIEF COMING FROM INVESTORS THAT POTENTIALLY WE ARE HEADED TOWARD AN EASIER MONETARY PATH. NASDAQ FUTURES AND S & P FUTURES NOT DOING MUCH AT THE MOMENT. WE DO HAVE NVIDIA EARNINGS LATER THIS WEEK AS WELL. AVRIL: AS YOU ALLUDED TO, IT IS THIS A AND THE SIGH OF RELIEF. LET'S BRING IN KATHY REYNOLDS WHO LEADS OUR MARKET LIVE COVERAGE. YOUR TAKE ON IT AND HOW HELPFUL IS IT GOING TO BE FOR ASIA STOCKS? > > IT WILL BE VERY HELPFUL FOR ASIA STOCKS. A COUPLE OF SOURCES. WE WENT INTO JACKSON HOLE WITH A LOT OF CONCERN THAT POWELL WAS GOING TO PUSH BACK ON THE BIDS FOR A SEPTEMBER CUT AND IN PARTICULAR SOME OF THE BATS THAT THE SEPTEMBER CUT WOULD LEAD TO ANOTHER CUT. AFTER SOME FAIRLY CONCERNING INFLATION DATA, BUT HE CLEARLY SHOWED THAT THE LABOR MARKET IS FRONT OF HIS MIND AND WHEN THE LABOR MARKET IS FRONT OF HIS MIND, THAT MEANS RATE CUTS ARE COMING. IT SORT OF LINES UP WITH A VERY MUCH FRAMED IT AS THIS IS WHAT WE WERE ALWAYS EXPECTING WOULD BE THE CASE, THAT WE WOULD CUT RATES TWO OR THREE TIMES. IF YOU'RE GOING TO CUT RATES TWICE, SEPTEMBER ALMOST CERTAINLY HAS TO BE WHEN YOU START. THAT WAS GREAT FOR U.S. STOCKS. ASIAN STOCKS WILL ENJOY THAT AS WELL. IT ALSO BROUGHT THE DOLLAR RIGHT DOWN. THE DOLLAR COMES DOWN, THAT LEAVES THE PRESSURE ON THE CURRENCIES. THE BANK OF KOREA IS UNLIKELY TO CUT RATES THIS WEEK. IT DOESN'T HAVE TO BE AS HAWKISH BECAUSE IT DOESN'T HAVE TO WORRY THAT IF IT IS NOT SUFFICIENTLY HAWKISH THE KOREAN WON WILL DECLINE. SIMILAR FOR THE PHILIPPINES. THEY HAVE A CLEAR PATH TO DO WHAT THEY NEED TO DO BASED ON THEIR ECONOMY, NOT SO MUCH BECAUSE THE DOLLAR IS BUSY PRESSURING THEM. IF POWELL HAD GONE HAWKISH, THAT WOULD HAVE BEEN A MAJOR ISSUE. SO, WE SHOULD HAVE A PRETTY CALM WEEK HERE IN ASIA. OTHER THAN PEOPLE ARE LOOKING FORWARD TO NVIDIA, WHICH IS ALSO KEY FOR SOME MAJOR -- MAJOR ASIA STOCKS. SHERY: THAT IS EXACTLY WHAT I WAS HEADED TO BECAUSE WE DO HAVE SOME ARE LIQUIDITY TO CONTEND WITH. WE HAVE SEEN THIS INCREDIBLE RALLY WHEN IT COMES TO TECH STOCKS AND PERHAPS A LITTLE BIT OF A WIDENING OF THE RALLY WHEN IT COMES TO U.S. STOCKS AND THE S & P 500. AS I MENTIONED, NVIDIA. HOW BIG OF A RISK COULD THEIR EARNINGS THIS WEDNESDAY BE FOR THE BROADER GLOBAL EQUITY SPACE? GARFIELD: IT HAS ENORMOUS IMPACT ON GLOBAL STOCKS GIVEN THE MARKET SIZE AND ITS IMPLICIT RATES AND REGULAR VOLATILITY. IT USUALLY MOVES AROUND THE BED AND THAT GETS AMPLIFIED BY HOW MUCH IT IS WORTH. THE SHEER DOLLAR VALUE THAT GOES THROUGH NVIDIA STOCK HAVE SET A LOT OF WEIGHT AND ITS ROLE AS THE POSTER CHILD FOR THE AI BOOM. ON THE ONE HAND, NVIDIA HAS PROVEN MOST OF THE TIME OVER RECENT YEARS TO NOT BE MUCH OF A RISK. IT SEEMS IF WE GO IN EXPECTING THEY WILL SHOOT THE LIGHTS OUT, THEY SHOOT THE LIGHTS OUT EVEN MORE THAN EXPECTED AND IF WE THINK THIS IS A TIME WHEN THEY START TO SLOW DOWN, THEY GO AHEAD AND SHOOT THE LIGHTS OUT AGAIN. SO, THE DIRECT NVIDIA RISKS SEEM LOW ESPECIALLY THAT IT DEFINITELY HELPS THAT THE FED HAS PIVOTED TO BE MORE DOVISH, THE TECH SPACE IS STILL VERY MUCH EQUIVALENT TO LONG BONDS IN ITS EXPOSURE TO HIGHER INTEREST RATES. SO THAT IS GOING TO HELP. THERE IS A LOT OF DISQUIET BUBBLING AWAY UNDER THE SURFACE ABOUT THE POTENTIAL THAT THE AI BOOM IS GETTING CLOSE TO ITS SPEED LIMIT, AS IT WERE. THERE ARE CONCERNS BEING RAISED THAT THE PACE OF ADVANCE IN THE TECHNOLOGY ITSELF IS SLOWING DOWN. IT MIGHT BE REACHING ITS CAPACITY. THERE ARE CONCERNS ABOUT MEETING THE POWER NEEDS. THERE ARE LONGER-TERM CONCERNS ABOUT THE AI SPACE. IN THE SHORT-TERM, NVIDIA MAY WELL HOPE TO PAPER OVER ANY OF THOSE CRACKS AND WE WILL SEE WHETHER THE BOOM CAN SUSTAIN. OR IN PARTICULAR IF IT CAN COME IN FOR A SOFT LANDING AS IT WERE. AT SOME POINT, THE PACE OF THESE GAINS HAS TO SLOW DOWN. THE CHANCE -- THE QUESTION IS WHETHER IT CAN SLOW DOWN WITHOUT FALLING BACK. SHERY: GARFIELD REYNOLDS WITH WHAT TO EXPECT THIS WEEK AS WE ARE FOLLOWING GEOPOLITICAL JUST GEOPOLITICS IN NEGOTIATIONS WE HAVE SEEN WHEN IT COMES TO DIPLOMATIC RELATIONS BETWEEN SOUTH KOREA AND JAPAN. THEY HAVE AGREED TO STRENGTHEN TIES FOLLOWING A WEEKEND MEETING BETWEEN THEIR LEADERS. THE KOREAN PRESIDENT'S AND WASHINGTON, D.C. FOR TALKS WITH PRESIDENT TRUMP LATER ON MONDAY. OUR CHIEF NORTH ASIA CORRESPONDENT JOINS US FROM HONG KONG. INTERESTING THAT THE PRESIDENT STOPPED BY BEFORE HEADING TO THE UNITED STATES. ARE WE SEEING A CHANGE IN STANCE COMING FROM PRESIDENT WHO HAS KNOWN TO BE A HARSH CRITIC OF JAPAN IN THE PAST? > > WHEN YOU GET INTO OFFICE, YOU BECOME MUCH MORE FOR PRAGMATIST OFTENTIMES. IT MAKES SENSE THAT HE STOPPED IN TOKYO FIRST FOR A COUPLE OF HOURS OF TALKS BEFORE GOING ON AND HE WILL MEET DONALD TRUMP LATER. KEEP IN MIND, THE JAPANESE PRIME MINISTER HAS MET WITH DONALD TRUMP AND HAS HAD MULTIPLE PHONE CALLS. PRESIDENT LEE HAS NOT MET WITH DONALD TRUMP. HE IS A FAIRLY NEW LEADER OBVIOUSLY AFTER THE POLITICAL AND CONSTITUTIONAL CRISIS WE SAW IN SOUTH KOREA. I THINK HE WAS TAKING SOME NOTES FROM PRIME MINISTER ISHIBA. AND SEEING WHETHER THEY CAN BUILD OR JUST KEEP THE STATUS QUO ON WHAT WAS REALLY, WHAT REALLY DEVELOPED IN THE PREVIOUS ADMINISTRATIONS OF ALL THREE COUNTRIES. JOE BIDEN , THEY HAD SO OF A TRILATERAL AGREEMENT TO BUILD A COOPERATION. ALL THREE OF THOSE LEADERS ARE OUT OF OFFICE AND DONALD TRUMP'S EXISTENCE SINCE JANUARY ESSENTIALLY HAS RAISED A LOT OF QUESTIONS ABOUT SECURITY ALLIANCES IN EAST ASIA. THAT IS WHY THIS MEETING IS QUITE IMPORTANT TO BUILD UPON THE TRADE AGREEMENT AND WHAT WILL THOSE SECURITY AGREEMENTS LOOK LIKE? WHAT WILL THOSE ALLIANCES LOOK LIKE GOING FORWARD? FOR THE NEXT THREE YEARS UNDER TRUMP. AVRIL: WHAT ELSE ARE WE EXPECTING FROM THAT LEE-TRUMP BILATERAL MEETING? STEPHEN: I THINK THE MEETING SATURDAY IN TOKYO WAS A PRECURSOR TO THE BIGGER BILATERAL NO DOUBT. LOOK, THEY HAVE TO SEE WHAT KIND OF RELATIONSHIP DONALD TRUMP CAN BUILD WITH THE NEW SOUTH KOREAN PRESIDENT. AND WHERE AND HOW DOES THIS TRADE AGREEMENT LOOK LIKE GOING FORWARD? SOUTH KOREA HAS PROMISED A 50 BILLION FUND , THEY ARE LIKELY TO VISIT A SHIPYARD. PLEDGING TO BUY HUNDREDS OF BILLIONS OF DOLLARS OF ENERGY. THE SECURITY ARRANGEMENTS ARE ALSO CRITICAL. THEY HAVE BEEN CRITICAL OF NOT PICKING UP A BIGGER BILL. THAT WILL MOST LIKELY COME UP. IT WOULD URGE PRESIDENT TRUMP TO REENGAGE WITH PYONGYANG. WE KNOW DONALD TRUMP HAS MET WITH KIM JONG-UN IN SINGAPORE AND HANOI AND AT THE VILLAGE AT THE BORDER. AGAIN, THAT WILL BE FRONT AND CENTER IN THAT MEETING IN THE WHITE HOUSE. AVRIL: THANK YOU SO MUCH. OUR CHIEF NAVY -- NORTH ASIA CORRESPONDENT, STEPHEN ENGLE. MORE AHEAD ON THE ASIA TRADE. ♪ CHAIR POWELL: THE BASELINE OUTLOOK AND THE SHIFTING RISKS MAY WARRANT SHIFTING. THE STABILITY OF THE UNEMPLOYMENT RATE AND LABOR MARKET MEASURES ALLOWS US TO PROCEED CAREFULLY. IT IS A CURIOUS KIND OF BALANCE. WE WILL NOT ALLOW A ONE TIME INCREASE IN THE PRICE LEVEL TO BECOME AN ONGOING INFLATION PROBLEM. AVRIL: FED CHAIR JAY POWELL OPENS THE DOOR TO AN INTEREST RATE. JOINING US NOW IS THE CHIEF ASIA-PACIFIC ECONOMIST AT VANGUARD GROUP. THANK YOU. WE ARE STILL LOOKING AT SOME OF THESE TOWEL COMMENTS. THE READTHROUGH IS THAT IT WAS DOVISH. HOW MUCH COVER DOES THIS PROVIDE TO ASIAN CENTRAL BANKS INCLUDING THE BANK OF KOREA THAT HAS A DECISION THIS WEEK? QIAN: GOOD MORNING. I THINK IT IS ACTUALLY A PRETTY BALANCED TONE. IT DOES RECOGNIZE THAT THE BALANCE OF RISK IS SHIFTING. SO THAT MAKES A SEPTEMBER CUT TO BE THE BASELINE AT THIS MOMENT. WE HAVE BEEN EXPECTING TWO CUTS THIS YEAR. THAT SEEMS TO BE STILL EXPECTED. WHEN YOU LISTEN TO HIS COMMENTS, HE CONTINUED TO EMPHASIZE THE RISK ON INFLATION. TO THAT EXTENT, EVEN IF WE GET A CUT IN SEPTEMBER I WOULD NOT CHARACTERIZE IT -- I WOULD CHARACTERIZE IT MORE AS A HAWKISH CUT. I THINK THE DECISION OF THE FED WILL BE VERY MUCH DEPENDENT ON DATA, ESPECIALLY HOW WEAK THE LABOR MARKET WILL BE WHEN THEY MAKE THAT DECISION IN SEPTEMBER. IN TERMS OF THE ASIAN CENTRAL BANKS, OF COURSE EVERYBODY IS WATCHING THE FED, WHAT THEY WILL DO. BUT I THINK ULTIMATELY, THEIR DECISION WOULD STILL VERY MUCH DEPEND ON THE DOMESTIC SITUATION AS WELL AS THE REACTION FUNCTION , ESPECIALLY THE WEAKER DOLLAR SO FAR THIS YEAR PROVIDING CENTRAL BANKS FLEXIBILITY TO MAKE THEIR DECISION. YOU MENTIONED ABOUT THE BANK OF KOREA. I WOULD SAY THEY PROBABLY WANT TO STAY ON HOLD TO BE IN A WAIT AND SEE MODE. ON ONE HAND, WE KNOW THE BANK OF KOREA CARES A LOT ABOUT FINANCIAL STABILITY RISKS. HOUSING PRICES, DEBT. AT THE SAME TIME, WE DO KNOW THE KOREAN GROWTH OUTLOOK HAS IMPROVED SLIGHTLY RECENTLY. I THINK THEY WOULD JUST WANT TO WAIT A LITTLE BIT AND THEN PROBABLY RIGHT ON CUE IN OCTOBER TO SEE WITH THE FED WILL DO. SHERY: BUT WHAT ARE YOU SEEING IN TERMS OF THAT ECONOMIC DATA THAT HAS CHAIR POWELL LEANING TOWARD A CUT? WE CONTINUE TO SEE INFLATIONARY PRESSURES HIGH IN THE UNITED STATES AND MORE FISCAL POLICY PERHAPS OPENING THE TAPS FOR A MORE OVERHEATED ECONOMY? QIAN: YES, TOTALLY. I THINK WHAT IS CLEAR IN POWELL'S COMMENTS IS THAT THE FED IS WILLING TO LOOK THROUGH THE TARIFF RELATED INFLATION AS LONG AS INFLATION EXPECTATION IS WELL ANCHORED IN THE LONG-TERM. SO, GIVEN THAT, I THINK IN TERMS OF THE REACTION FUNCTION, YOU CLEARLY SEE THE FOCUS SHIFTING FOR THE LABOR MARKET STRANDS. I THINK THE QUESTION IS HOW WEAK THE LABOR MARKET IS, ESPECIALLY THE WEAKENING AND THE LABOR DEMAND. I THINK THE CRITICAL DATA TO WATCH UNLESS THERE ARE SIGNIFICANT JUMPS IN INFLATION DATA. I THINK WHERE THE UNEMPLOYMENT RATE GOES. I THINK THAT WILL BE SOMETHING TO BE CRITICALLY WATCHED. THAT SAID, EVEN THOUGH POWELL SAID THERE SHOULD BE ADJUSTMENT IN MONETARY POLICY, I WOULD SAY THAT ADJUSTMENT WILL BE VERY GRADUAL. ONE IS THE INFLATION RISK IS DEFINITELY ON THE OUTSIDE WHEN THE ECONOMY SEEMS TO BE RUNNING PRETTY HOT WITH THE FISCAL POLICY STIMULUS THAT IS COMING AND THE OTHER IS THE NEUTRAL RATE IN THE ECONOMY THAT IS HIGHER. WE SEE THEM STOP AT 3.5%. BY END OF NEXT YEAR. AVRIL: WHAT ABOUT WHAT ELSE WE HEARD FROM JACKSON HOLE TALKING ABOUT HOW THE TIGHT LABOR MARKET EXERTS UPWARD PRESSURE? IS THAT A HAWKISH ENOUGH READTHROUGH TO YOU THAT MAY BE COALESCES EXPECTATIONS AROUND AND OCTOBER RATE HIKE? QIAN: YES, I THINK THE BOJ IS REALLY THE OUTLIER AMONG GLOBAL CENTRAL BANKS. I THINK JAPAN'S SITUATION IS DIFFERENT FROM OTHER COUNTRIES. AT THIS MOMENT, WE SEE THAT JAPANESE GROWTH, WE DO SEE SOME STRUCTURAL TURNAROUND IN DOMESTIC CONSUMPTION AND INVESTMENT AND WE DO SEE STRUCTURAL CHANGE IN PRICE SETTING BEHAVIOR SUSTAINED BY THE TIGHTER LABOR MARKET. GIVEN THAT, I WOULD SAY THAT WE DO SEE THERE WAS A GOOD CHANCE INFLATION WILL CONTINUE TO PASS THROUGH FROM WAGE TO PRICE AND THAT CORE INFLATION SHOULD BE ABLE TO SUSTAIN AROUND 2%. THAT ACTUALLY PROVIDES SUPPORT TO HIKE INTEREST RATES LATER THIS YEAR, ESPECIALLY WHEN THE TRADE ON UNCERTAINTY HAS REDUCED QUITE A BIT AFTER THE TRADE AGREEMENT HAS BEEN ACHIEVED. THIS IS WHERE WE ACTUALLY SEE THE HIKE AND THEN BRINGING THE RATE TO NEUTRAL IN COMING YEARS. SHERY: DEFLATIONARY PRESSURES AFFECTING THE CHINESE ECONOMY AS WE GET DATA THAT IS NOT TOO POSITIVE. WILL WE SEE THE PBOC MOVING AT ANY POINT? DOES MORE EASY MONEY MAKES SENSE AT THIS POINT? QIAN: I THINK WHEN YOU LOOK AT CHINA, THE WEAKNESSES ON THE DOMESTIC SIDE. IT HAS BEEN HOLDING ON SO WELL SO FAR THIS YEAR. WE DO SEE MORE SIGNS OF A DOMESTIC SLOW DOWN AND ALSO THE SIGNIFICANT DEMAND-SUPPLY IMBALANCE DRIVING THIS DEFLATIONARY PRESSURE. I THINK THAT IS WHY THE GOVERNMENT IS TRYING TO ADDRESS THIS STRUCTURAL ISSUE WITH THE CAMPAIGN. I WOULD SAY TO DEAL WITH THIS DEFLATION CHALLENGE, THE KEY IS REALLY PUSHING UP THE DEMAND. ON THE OTHER HAND, THE CAMPAIGN IS LIKELY TO BE RATHER GRADUAL AND SECTOR SPECIFIC AND THIS NEEDS TO BE LIMITED. IN TERMS OF THE CENTRAL BANK, I WOULD SAY THERE WAS ROOM TO CUT INTEREST RATES. WHEN THE ECONOMY IS STUCK IN THIS PERSISTENT DEFLATIONARY PRESSURE. WE KNOW THAT THE CENTRAL BANK IN CHINA IS ALWAYS RELUCTANT TO CUT INTEREST RATES. WE EXPECT A VERY GOOD 10 POINT CUP LATER THIS YEAR BUT EVEN THAT I WOULD SAY IS PROBABLY ONLY LATER THIS YEAR WHEN THE POLICYMAKERS SEEM MORE CONFIDENT OF A DOWNTURN IN THE ECONOMY. THAT IS WHEN THEY WILL STEP UP WITH MORE POLICIES MONETARY AND FISCAL. SHERY: GOOD TO HAVE YOU WITH US, THE CHIEF ASIA-PACIFIC ANALYST AT VANGUARD GROUP. WE HAVE MORE AHEAD. THIS IS BLOOMBERG. ♪ SHERY: WE HAVE BREAKING EARNINGS FROM SANTOS, REPORTING UNDERLYING PROFIT FOR THE FIRST HALF OF THE YEAR THAT BEAT THE AVERAGE ANALYST ESTIMATE. COMING IN AT $508 MILLION VERSUS THE ESTIMATE OF ABOUT $433 MILLION. THERE HAVE BEEN SOME EXPECTATIONS THAT THIS COULD COME UNDER PRESSURE AND THIS IS AGAINST THE BACKDROP OF THE SALES DECLINE IN THE SECOND QUARTER, BUT THAT DOESN'T SEEM TO BE THE CASE AT THE MOMENT. THIS IS ALSO COMING ALONG WITH A LOT OF FOCUS ON THE COMPANY GIVEN HOW LAST WEEK WE SAW PRESSURE ON THE STOCK FOLLOWING THE ABU DHABI LED CONSORTIUMS TAKEOVER OF SANTOS THAT HAD SORT OF DELAYED 9 BILLION WORTH. WE ARE SINCE HEARING THAT SANTOS OR THE GROUP HAS SINCE AGREED TO AN EXTENSION OF THE PROCESS INDEED AND THIS WILL BE UNTIL THE 19TH OF SEPTEMBER THIS YEAR. SHERY: YES, WE CONTINUE TO WATCH THE ENERGY SECTOR WITH THE OIL RISING AFTER CHAIR POWELL SOUNDED A BIT MORE DOVISH. WE ARE TALKING ABOUT A POTENTIAL RATE CUT TO COME IN SEPTEMBER AND U.S. FUTURES AT THE MOMENT UNCHANGED, BUT THE S & P 500 HAD ITS BEST DAY SINCE MAY AFTER THE LONGEST LOSING STREAK SINCE JANUARY. THE DOW IS AT A RECORD HIGH. YOU CAN SEE THE BLOOMBERG DOLLAR INDEX NOT DOING MUCH AFTER SINKING FRIDAY AFTER CHAIR POWELL'S COMMENTS, BUT THE DOLLAR ALSO TAKING A LEG LOWER AFTER PRESIDENT TRUMP SAID HE WOULD FIRE FED GOVERNOR LISA COOK IF SHE SAID SHE WOULD RESIGN -- IF SHE SAID SHE WOULD NOT RESIGN. ALL EYES ON THE TECH SECTOR WITH NVIDIA REPORTING WEDNESDAY. WE HAVE MORE AHEAD ON THE ASIA TRADE. THIS IS BLOOMBERG. ♪ > > THE FED IS LOOKING AT SLIGHTLY HIGHER INFLATION AND WEAKENING LABOR MARKET. AND WHAT POWELL FINALLY DID AND MANY OF US FEEL HE SHOULD HAVE DONE THIS EARLIER IS HE SAID THE RISK TO THE EMPLOYMENT SIDE IS HIGHER THAN THE RISK TO TIN FRUSTRATION IN SIDE. THEREFORE AN INTEREST RATE CUT IS WARRANT. MANY OF US FELT HE SHOULD HAVE CUT LAST MONTH. SHERY: MOHAMMED ALRIAN FROM HIS POLICYFUL WE HEARD FROM JAMES BULL DARD. HE IS A CONTENDER TO SUCCEED JAY POWELL AS FED CHAIR AND SPOKE TO US AFTER POWELL’S COMMENTS AT JACKSON HOLE PUTTING A SEPTEMBER CUT ON THE TABLE. > > HE USED THE -- THE SPEECH TO SOLIDIFY EXPECTATIONS FOR 25 BASIS POINTS IN SEPTEMBER. I WAS EXPECTING THAT ANYWAY. MARKETS WERE EXPECTING THAT. HE LEANED INTO THE MOST RECENT LABOR MARKET REPORT WHICH WAS VERY SOFT. AND SO I THINK THAT’S -- THAT’S A DONE DEAL. HE DIDN’T SAY TOO MUCH ABOUT BEYOND THAT. WHAT YOU WANT TO DO WITH THE OCTOBER MEETING OR THE DECEMBER MEETING. I HAVE SET UP 20 BASIS POINTS GOING INTO 2026. I THINK YOU COULD ADJUST AS YOU GO FORWARD AND -- AND EVENTUALLY GET A FULL 100 BASIS POINTS. BUT I WOULD GO SLOWLY IN ORDER TO WATCH THE DATA. AND THEN ON THE FRAMEWORK REVIEW, I’M SURE MUCH EARLIER IN THE YEAR, THEY WOULD HAVE THE FRAMEWORK DISCUSSION AND THEY WOULD USE THE JACKSON HOLE SPEECH TO TALK ABOUT CHANGES FOR THE FRAMEWORK. I THOUGHT THOSE WERE THOUGHTFUL AND THEY’RE WELL PRESENTED IN THIS -- IN THIS SPEECH. AND THEY’RE ABOUT WHAT MANY HAVE SPECULATED ON. SO I THINK THEY DID ABOUT AS MUCH AS THEY CAN ON THE FRAMEWORK SIDE. > > JIM BULLARD, TOM KEEN. I DEFINITELY CONSIDER THIS MY CONVERSATION OF THE DAY. YOU SERVE A LENGTHY TERM AT THE ST. LOUIS FED. YOU HAVE LIVED THE DECLINE OF A GREATER ECONOMY. DECADES AND DECADES AGO IN THE EFFORT TO PROVIDE FOR A A RESURGENT ST. LOUIS. IS THE NEXT CHAIRMAN OF THE FED WHOEVER THAT MAY BE, DO THEY HAVE TO MANAGE FOR TWO AMERICAN ECONOMIES, TECHNOLOGY-DRIVEN EXCEPTIONAL ECONOMY AND ANOTHER TO USE A CLICHE AMERICA FLAT ON THEIR BACK? HOW WOULD A CHAIRMAN EXECUTE THOSE TWO AMERICAS? > > YEAH, I’M THINKING COMMONWEALTH DISTRIBUTION BECOME MORE SALIENT TOPICS FOR THE FED. IT’S NOT CLEAR HOW MUCH THE FED CAN REALLY DO. PROVIDING INTEREST RATE POLICY FOR THE WHOLE ECONOMY. IF YOU CHANGE THE RATE STRUCTURE, THAT AFFECTS EVERYONE NOT JUST ONE PARTICULAR GROUP THAT YOU MIGHT BE TARGETING. SO I THINK THAT’S BEEN SOMETHING WE’VE HAD TO WRESTLE WITH. AND I’VE ACTUALLY DONE RESEARCH ON IT MYSELF TO TRY TO UNDERSTAND IT BETTER FROM MY POINT OF VIEW. SO I THINK THERE’S BEEN A THEME FOR A WHILE. AND THAT WILL BE AN IMPORTANT THEME GOING FORWARD. > > FORMER ST. LOUIS FED PRESIDENT JAMES BULLOCK SPEAKING TO TOM KEEN. THE U.S. GOVERNMENT IS TAKING A 10% STAKE IN INTEL AS PART OF AN UNEXCEPTIONAL BID TO REVIVE THE COMPANY AND BOOST DOMESTIC CHIP MANUFACTURING. LET’S BRING IN OUR ASIA TECH CORRESPONDENT. WHAT SHAPE IS THE DEAL TAKING? > > YES, SO THE BROAD SORT OF CON TOURS OF THE DEAL HERE IS THE U.S. IS GOING TO BE RECEIVING JUST OVER 433 MILLION SHARES OF COMMON STOCK. THAT’S UNDER A 10% STAKE IN THE BUSINESS IN TERMS OF THE AMOUNT, THE DEAL IS WORTH. # .1 BILLION WHICH WE HAVE BEEN REPORTING THE FUNDING THE COMPANY HAS BEEN GETTING. SOME SAY IT’S RECEIVED $2 BILLION WORTH. THE REST IS SLOTTED PAYMENTS FOR THE FUTURE. IT’S WHAT WE’VE BEEN DISCUSSING. WHAT WE DO KNOW IS THAT THE U.S. GOVERNMENT IS GOING BE A PASTE OWNER, WHICH MEANS THEY’RE GOING TO HAVE NO BOARD SEAT OR OTHER GOVERNMENT INFORMATION. INTEL HAS PUT OUT A STATEMENT SAYING THEY’RE GRATEFUL FOR THE SUPPORT FROM THE TRUMP ADMINISTRATION. PRESIDENT TRUMP IS SAYING THIS IS A GREAT STEP FOR BOTH INTEL. AND ALSO FOR AMERICA. BUT IT IS IMPORTANT TO UNDERSCORE THAT IT’S VERY U UNCONVENTIONAL TO TAKE A LARGE STAKE OR ANY STAKE IN THE U.S. FIRM. BUT IT DOES UNDERSCORE THE SIGNIFICANCE OF THE OVERALL PROJECT AND JUST HOW MUCH THE U.S. GOVERNMENT WANTS TO -- TO -- TO BOOT UP THE SEMICONDUCTOR PRODUCTION CAPABILITIES OF U.S. FIRMS AS WELL. SHERY: NVIDIA AT THE CENTER OF THAT AS WELL. WE KNOW HOW CONSEQUENTIAL THIS WILL BE BECAUSE THEY TAKE, WHAT, 3% OF GLOBAL MARKET CAP. ABOUT 8% OF THE S & P 500 AS WELL. WHAT ARE WE EXPECTING? > > YEAH, THINK THAT REALLY PUTS IT IN -- IN HEADLINES HOW SIGNIFICANT THESE NUMBERS ARE GOING TO BE. YOU HAD TRADERS BREATHING A SIGH OF RELIEF AFTER JAY POWELL SPOKE AT JACKSON HOLE. BUT THIS WEEK WILL BE THE KEY TEST ESPECIALLY SEEING A LITTLE BIT OF WEAKNESS. YOU CAN SEE HERE WHAT WE’RE GOING TO BE. WAG IN THESE, REVENUE FOR INSTANCE IS GOING TO COME AT $60 BILLION AND A REVENUE JUMP ON THE YEAR. ADJUSTED EARNINGS. .01 IS EXPECT. IT’S GOING TO BE IMPORTANT FOR THE MARKET. WE’RE GOING TO SEE BIG MOVES IN EITHER DIRECTIONS, OPTIONS, TRADERS. WE’RE LOOKING ABOUT A 6% JUMP IN EITHER DIRECTION BASED ON THE FIGURES THAT WE GET OUT OF IT AS WELL WHAT’S GOING TO BE REALLY IMPORTANT TO TRACK ESPECIALLY BECAUSE WE HAD THAT REPORTING LAST WEEK AROUND BEIJING OR THE CHINESE GOVERNMENT ASKING MAINLAND FIRMS TO NOT ASK AGE 20. WE HAD NVIDIA PERHAPS PUTTING A PROTECTION HALT ON THOSE PRODUCTS. WHAT ARE THEY GOING BE SAYING ABOUT H-20 IN PARTICULAR? AND WHERE ARE THEY GOING IN THE CHINESE MARKET? > > YEAH, AS WE WAIT TO HEAR NVIDIA’S CHINESE BUSINESS, WE ARE KEEPING TAGS ON CON SUMMER TECH. APPLE IS IN THE SPOTLIGHT. IT’S BIGGEST LAUNCH IS NEARING. WHAT ARE WE EXPECTING HERE? > > I THINK IT’S ACTUALLY INTERESTING TO SORT OF -- ALSO POINT OUT THAT APPLE IS ANOTHER COMPANY THAT’S DEPENDENT ON THE CHINESE MARKET IN THE MAINLINE MARKET. HAS FACED A LOT OF PRESSURE THERE. WHAT IS IMPORTANT ABOUT APPLE IS THERE’S SORT OF NO DENYING THAT OVER THE PAST FEW YEARS, YOU’VE SEEN THE DESIGN INNOVATION SLOW. THERE’S REALLY GREAT POWER FROM OUR GOVERNMENT AND OUR RESIDENT APPLE EXPERT. BUT ESSENTIALLY OUTLINING WHAT WHAT WE CAN EXPECT FROM APPLE GOING OVER THE NEXT THREE YEARS. YES, YOU’VE SEEN THE PACE OF INNOVATION SLOWING DOWN. SO FROM 25, 26, 27, WE CAN EXPECT MAJOR OVERHAULS TO -- TO THE IPHONE PRODUCTS. REDESIGNS ARE HAPPENING EACH YEAR. THIS YEAR, WE CAN EXPECT THE IPHONE AIR WHICH TAKES THE NAME FROM THE MAC BOOK AIR BUT A VERY SKINNY IPHONE IS EXPECTED TO COME TO MARKET. THERE WILL BE COMPROMISES. BATTERY, ONLY ONE REAR CAMERA. ALONGSIDE THAT, WE’LL GET THE 17 PRO, 17 MAX SO NOT TOO MANY MORE CHANGES EXPECTED THIS YEAR IN 2006, WE’LL GET A GAME CHANGER THAT’S THE FIRST EVER IPHONE FOLDABLE. SO THAT WILL BE A REALLY BIG EVENT. WE’VE SEEN SAMSUNG HAVING SUCCESS IN THAT CATEGORY WITH THEIR FOLDABLE PHONES. AND 2027, AND THIS WILL BE THE BIG GAME CHANGER. BUT THAT’S WHEN WE GET A CURVED GLASS, IPHONE 20. THAT’S WHEN WE WILL BREAKING AND ENTERING THE DESIGN AWAY FROM WE’VE SEEN IN RECENT YEARS AND BECOME USED TO AS MANY OF OUR APPLE CONSUMERS AS WELL. SHERY: THE LATEST ON WHAT TO WATCH IN TECH. AS WE WILL BE WATCHING IN JAPAN, TERUMOL GETTING THE LATEST HEADLINE THAT THEY WILL BE BUYING A U.K. BASED COMPANY AND TERUMO COMING OUT WITH A STATEMENT SAYING THIS COMPANY IS AN INNOVATOR IN ORGAN PRESERVATION DEVICES. SO THIS STOCK HAS FALLEN FOR THE PAST FOUR SESSIONS. BUT WE WILL BE WATCHING IT IN THE OPEN IN JAPAN. WE HAVE MUCH MORE ON THE ASIA TRADE. THIS IS BLOOMBERG. SHERY: WE’RE WATCHING THE GOLD. IT’S UNDER A LITTLE BIT OF PRESSURE. WE HAVE SEEN THAT LITTLE BIT OF A BUMP AFTER THE DOLLAR AND BOND YIELDS TUMBLE WITH CHAIR POWELL SETTING THAT INTEREST RATES CUT COME IN SEPTEMBER. IT ROSE AFTER CHAIR POWELL GAVE COMMENTS ON THAT GIVEN THAT INVESTORS TO HELP THE BROADER ECONOMY. A LOT TO DO WITH CHINA ON THIS SECTOR AS WELL. OTHER STORIES THAT WE’RE FOLLOWING, CANADIAN PRIME MINISTER MARK CARNEY VISITED KYIV ON INDEPENDENCE DAY PLEDGING SUPPORT FOR AS LONG AS IT TAKES ZELENSKY SAID THAT PEACE WITH RUSSIA MUST COME THROUGH STRENGTH. CANADA ALSO ANNOUNCED OVER 1.4 BILLION DOLLARS IN MILITARY AND REINSTRUCTION AID. PRESIDENT ZELENSKY SAID SECURITY GUARANTEES FOR A POST WAR UKRAINE WILL BE READY IN DAYS. HE ADDED AND ACCUSED RUSSIA OF RISING TENSIONS. AND THERE’S A DEAL BROKERED BY THE U.A.I. AND ANOTHER STORY THAT WE’RE FOLLOWING AT THE MOMENT, WE SEE SWISS PRIVATE BANK IS SET TO BE ENDING RELATIONSHIPS WITH WEALTHY CLIENTS FROM THE MIDDLE EAST INCLUDING MANY WITH ASSETS INCLUDING OR EXCEEDING 100 MILLIONFUL OVER 1,000 CLIENTS FROM SAUDI ARABIA, LEBANON CAR, TAR AND EGYPT WILL BE AFFECTED. THE MOVES COMES AS THE BANK SEES -- SEEKS TO LOWER ITS PENSION POE SURE TO TWO INDIVIDUALS. IT CONSIDERS HIGH RISK. > > NOW, WHAT WE’VE ALSO BEEN TRACKING, I GUESS THE BACKDROP OF THESE FED DEVELOPMENTS. I-300 IS UP 12%, 11% THIS IS DESPITE THE TARIFF RISK, THE PROPERTY CRISIS. DEFRUSTRATION NAIR PRESSURE. SO CONTINUING TO DEFY GRAVITY HERE. THE QUESTION IS HOW MUCH MOMENTUM IS, AND HOW LONG CAN THIS LAST. THERE IS THE SENSE THAT ABUNDANT LIQUIDITY IN THE MARKET AND ANIMAL SPIRITS BEING REVIVED CAN HELP THIS RALLY TO CONTINUE JUGGING ALONG. IT’S WORTH NOTING THAT THIS IS MORE OR LESS TRAILING BEHIND WHAT WE’VE SEEN ON THE HU HUNGSINGH. IT MIGHT TAKE A WHILE FOR THEM TO CATCH UP TO THE ASIA SHARE RALLY OF THIS YEAR. MORE AHEAD ON THE ASIA TRADE. THIS IS BLOOMBERG. ♪ AVRIL: YOU’RE WATCHING THE ASIA TRADE. CHINA IS PROPOSING NEW RULES TO CONTROL THE INTERNET. THE DRAFT ALSO COVERS PLATFORM BEHAVIOR, BIG DATA USE AND COORDINATION BETWEEN REGULAR OR THE, INDUSTRY GROUPS AND TECH. LET’S BRING IN OUR CORRESPONDENT. TELL US MORE ABOUT THESE NEW RULES? MI INFORMATION MIN: THESE RULES ARE SUPPOSED TO HELP -- MIMIN: THEY’RE NOT ALLOWED TO PRICE DISCRIMINATE BASED ON A CONSUMER’S PATTERNS OR THEIR ABILITY OR WILLINGNESS TO PAY BIG DATA AND WITHOUT THE KNOWLEDGE OF CONSUMERS. THIS COMES AFTER MARKET REGULAR OR THES ALSO PROPOSE A DIFFERENT SET OF RULES THAT WOULD SET UP THE COMMISSION FEES THAT ARE IMPOSED ON MERCHANTS THAT USE THESE PLATFORMS. IT’S NOT AN EVOLUTION COMPANY BUT PERHAPS MORE OF THE MONOPOLY CAMPAIGN TO PREVENT THEM FROM ABUSING THEIR POWER AND TO PREVENT THE SMALLER COMPANIES ESPECIALLY AT A TIME WHEN THEY ARE FACING SLOWER SALES BECAUSE OF THE CONSUMERS, CONSUMPTION SLOWDOWN AND THE PROFITS AS WELL BY THE PLATFORM OPERATOR. SO THIS IS PART OF THE GOVERNMENT REGULATION TO PROTECT THE SMALLER PLAYERS ESPECIALLY GIVEN THAT THEY ARE ALSO SOME OF THE BIGGEST GENERATORS OF EMPLOYMENT IN CHINA. > > AND MINMIN, EVERGRANDE BEING DELISTED TODAY. WHAT HAPPENS NOW? > > YEAH,S THAT CULMINATION OF A VERY LONG DRAWN PROCESS. IT’S FINALLY BEING DELISTED. THE LIQUIDATION HEARINGS CONTINUE TO GO ON. THAT’S WHEN THEY WOULD CONTINUE AGAIN AND THIS TIME THE LIQUIDATORS WILL WEIGH IN AND TRY TO RECOVER THE ASSETS THAT HE HAS BECAUSE REPORTEDLY HE’S POCKETED AS MUCH AS ABOUT $7 BILLION OVER THE PAST DECADE OR SO THANKS TO THE GENERAL PAYOUT OF THE COMPANY AND IN THE PAST, THE TRIALS HAVE BEEN SO FAR FOCUSING ON HIS EX-WIFE AND C.E.O. OF LIQUIDORS. AROUND THE WORLD. BUT SO FAR IT’S A VERY, VERY COMPLEX UNDERTAKING BECAUSE THIS IS A COMPANY WITH AT LEAST 3,000 LEGAL BY S THE. ABOUT 8,800 PROPERTY TAXS IN 280 CITIES. SO IT’S VERY COMPLICATED. UNDERTAKING HERE. AND SO FAR THE LIQUIDATORS HAD TAKEN OVER 00FUL BUT THE REAL REALIZATION HAVE BEEN SLOW AND MODEST. THE TOTAL DEBT IS STANDING AT ABOUT $45 BILLION. WE CONTINUE TRACKING SOME OF THESE CHINESE DEVELOPERS THAT ARE COMING OUT. .7 BILLION. ANOTHER ONE THAT WE’RE WATCHING THE PRELIMINARY EARNINGS. COUNTRY GARDEN, THE NUMBERS DON’T LOOK GOOD EITHER. WIDENING UP AND HIGHER THAN THE LOSSES THAT THEY ACCEPTED IN THE YEAR PRIOR. AND THIS COMES THE BACKDROP OF THE BROAD DATA AS WELL ON HOUSING. YOU LOOK AT HOME SALES. IT’S BEEN DECLINING BY ABOUT 20% IN THE LAST COUPLE OF MONTHS. HOME PRICES HAD BEEN ACCELERATING DECLINES AND IT SEEMS THE BROADER RECOVERY IN THE HOUSING MARKET APPEARS BE BACKSLIDING A LITTLE BIT. U.B.S. DELAYING THE PROSPECT FOR HOUSING RECOVERY TO LET 2026. DECLINING HOME PRICES WILL CONTINUE TO QUIM ON PROPERTIES FOR COUNTRY GARDEN. THEY DEFAULTED ON THE DOLLAR BOND BACK IN 2023. IT’S IN TALKS WITH. AND THEY AGREED WITH SOME RESTRUCTURING CONDITIONS THAT WERE REQUESTED BY BANK CREDITORS. THAT COULD PUT IT IN A BROADER DEBT DEAL. THE BROADER RECOVERY REALLY DOESN’T BODE WELL FOR THE PROSPECT OF COUNTRY GARDEN GOING THROUGH THIS DEBT RESTRUCTURING PROCESS. AVRIL: THANK YOU SO MUCH. LET’S CHECK IN ON CRYPTO AS WELL. WE’LL BE DISCUSSION HOW THE FED HAS BEEN UNLOCKING THE RISK. THIS IS THE SIMILAR BACKDROP WHEN IT COMES TO CRYPTO, BITCOIN REALLY SURGED ON FRIDAY. BUT WE’RE SEEING A BIT MORE OF TEPID GAIN IN THE MONDAY SESSION EVEN THOUGH THEY REACHED THE RECORD HIGHS. > > IT’S REAL INTERESTING BECAUSE WE’RE SEEING SHOWING SIGNS OF MATURITY IN THE BITCOIN SPACE. VOLATILITY DROPPING ABOUT 38% FROM THE CLOSE TO ABOUT 200% MORE THAN A DECADE AGO. WE’LL BE WATCHING THESE MOVES TO THE CRYPTO SPACE AS WE KEEP OUR EYES ON, OF COURSE, THE TREASURY SPACE AND THE BOND MARKETS IN GENERAL GIVEN THAT IT’S BEEN A BIG CENTRAL BANK WEEK LAST WEEK. WE HAD JACKSON HOLE. WE HAD THE COMMENTS FROM FED CHAIR POWELL PERHAPS SIGNALING RATE CUTS TO COME AS SOON AS SEPTEMBER. AND OF COURSE, WE ALSO ARE WATCHING WHAT THE BANK OF JAPAN WILL DO NEXT. WE DO HAVE THE BANK OF KOREA. RATE DECISION THIS WEEK. ALSO IN KOREA, WE’LL BE WATCHING SHIPPING AND DEFENSE STOCKS WHEN MARKETS ARE OPEN. THIS COMES AS KOREAN PRESIDENT ANTICIPATES TO WORK WITH PRESIDENT TRUMP. LET’S BRING IN STOCKS REPORTER YU YUNG LEE. WE KNOW THAT THE PRESIDENT IS TAKING INVESTMENTS OF $300 BILLION INTO THE UNITED STATES. INVESTORS FOCUSED ON WHAT COULD BE SOME OF THE WINNERS AND PERHAPS SOME OF THE LOSERS AS WELL. > > YES, THAT’S RIGHT IF YOU LOOK AT THE KOSPI FUTURES THEY’RE RISING ABOUT 1%. IF YOU LOOK AT THE PREREGULAR TRADING, WE SEE SOME OF THE NUCLEAR ENERGY AND CHIPS AND STOCKS THAT COULD BE -- COULD BE DURING THE SOUTH KOREA SUPPORT. GAINING SOME GROUND. THIS IS THE LAST TRADING DAY IN SOUTH KOREA BEFORE PRESIDENT TRUMP MEETS THE PRESIDENTS OF SOUTH KOREA. SOME OF THE SECTOR IS THAT IT COULD BE DISCUSSED INCLUDING THE SHIP BUILDING. AND SOME ENERGY CORPORATION AS SOUTH KOREA TRIES TO FINALIZE THAT TRADE DEAL WITH THE UNITED STATES THAT WAS SIGNED LAST MONTH. NOW THERE ARE SOME INVESTMENT PLANS THAT SOUTH KOREA HAS BEEN MENTIONING AHEAD OF THE SUMMIT INCLUDING THE OOH BILLION IN THE SHIP BUILDING IN THE UNITED STATES TO REBUILD THE SHIP BUILDING. BUT INVESTORS ARE WAITING FOR FURTHER DETAILS OF HOW THAT STRUCTURE IS GOING TO BE SUCH AS HOW THE PRO IS IT IS GOING TO BE SHARED SO TODAY A LOT OF INVESTORS WILL BE POSITIONED AHEAD OF THE EXPECTED RESULT OF THE SUMMIT BECAUSE THIS IS THE LAST TRADING DAY BEFORE THE TWO LEADERS SPEAK. > > THERE SEEMS TO BE THAT BIT OF OPTIMISM IN KOREAN STOCKS WHAT ARE WE SEEING AGAINST FOREIGN BUYING INVESTORS. MAYBE PUSHING? > > SURE. SO THIS YEAR IT HAS BE A STAR AND GLOBAL DARLING IN THE WORLD. THE KOSPI HAS MORE THAN 30%. BUT THIS MONTH IN AUGUST, WE’VE SEEN FOREIGN INVESTORS SHIFTING THEIR FOCUS TO OTHER MARKS AND SELLING SOME -- SELLING THOSE. SO THEY SEEM TO BE TAKING SOME PAUSE IN BUYING IN SOUTH KOREA. GIVEN TO HIGH VALUE ASIANS. BUT THIS WEEK GIVEN THE JACKSON HALL AND THE THE POWELL’S PIVOT, WE MIGHT RESUME BUYING BY GLOBAL INVESTORRING IN SOUTH KOREA. > > THANK YOU SO MUCH. WE’LL WATCH THE OPEN KEEP IT HERE WITH US. THIS IS BLOOMBERG. > > WE’RE COUNTING DOWN TO THE MAJOR MARKET OPEN AND THE REACTION TO JACKSON HOLE AND FED CHAIR POWELL SIGNALING RATE CUTS TO COME AS SOON AS SEPTEMBER. WE’RE WATCHING HOW TENSE JACKSON HOLE WAS NOT ONLY BECAUSE OF HEIGHTENED INSECURITY BUT DIVERGENT POLICYMAKERS WHEN IT COMES TO MONETARILY PATHS. AVRIL: OPENING THE PATH TO A SEPTEMBER CUT BUT THEN AFTER SEPTEMBER THEN WHAT? THE FOCUS BASED ON POWELL’S COMMENTS IS GOING TO BE ON THE DATA. THIS WEEK WE HAVE HIS PREFERRED ENGAGEMENT OF INFLATION. AND AS IF THAT’S NOT FOR MARKS TO CONTEND WITH, WE HAVE NVIDIA MARKET SHARING. > > -- SHERY: INCLUDING IN THE PHILIPPINES AND SOUTH KOREA. THEY WERE TALKING ABOUT THE CONTINUED WAGE PRESSURES LEADING TO MORE SPECULATION OF A RATE HIKE TO COME THIS YEAR. YOU CAN SEE NIKKEI STOCKS GAINING .08 -- .8%. WE DID SEE THE JAPANESE YEN JUMPING AGAINST THE U.S. DOLLAR GIVEN THAT IT SANK AFTER CHAIR POWELL’S COMMENTS AND NOT TO MENTION PRESIDENT TRUMP ATTACKING THE FED CHAIR AND THE FED CHAIR COOK. TAKE A LOOK AT HOW SOUTH KOREA CAME ONLINE. WE HAD PRESSURE ON THE KOSPI AND THE WAN. THE EXPECTATION IS FOR THE CENTRAL BANK TO HOLD RATES STEADY. WE’RE WATCHING THE PRESIDENT MIONG’S TRIP AFTER HIS FEETING WITH BAHIR. WE’LL GET MORE INDICATIONS ON THAT TRADE DEAL WITH THE U.S. AND THE DETAILS OF THAT TRADE DEAL TO COME LATER IN THE WEEK. SOME THE KOREA WAN WEAKENING AGAINST DOLLAR IN THE SESSION, AVRIL. AVRIL: WE REALLY SAW ON THE DOLLAR ON FRIDAY FOLLOWING POWELL’S COMMENTS. LET’S TAKE A LOOK AT HOW THEY’RE FATHERINGFUL WE SAW THEM PLAYING OUT AND BUYING ON THE SHORT END OF THE TREASURIES, AND THE LONG AND STILL THE CONCERN ABOUT POTENTIALLY FUTURE INFLATION, THE DEFICIT IN THE U.S. AS WELL. AND WORTH NOTING AS WELL THAT WE SEE A LITTLE BIT TO THAT REVERSAL COME THROUGH IN TODAY’S SESSION BUT STOCKS DOING WELL INCLUDING IN AUSTRALIA. ANDS THAT MIX SHOWING WHEN IT COMES TO EARNINGS. THIS IS A MARKET, OF COURSE, THAT HAS BEEN VERY WELL VALUED. IT’S BEEN A HOT START MARKET. WE’VE SEEN INVESTORS PUNISHING COMPANIES WHEN THEY MISS ON EARNINGS. THAT’S SOMETHING WE’RE GOING TO BE WATCHING IN THE SESSION. AUSSIE A BIT SOFTER AGAINST THE GREEN BACK. LET’S HAVE A LISTEN. > > THE STABILITY OF THE UNEMPLOYMENT RATE AND OTHER LABOR MARKET MEASURES ALLOWS US TO PROCEED CAREFULLY AS WE CONSIDER CHANGES TO OUR POLICY STANCE. NONETHELESS, WITH POLICY AND RESTRICTIVE TERRITORY, THE BASELINE OUTLOOK AND THE SHIFTING BALANCE OF RISK MAY WARRANT ADJUSTING OUR POLICY STANCE. > > LET’S BRING IN HOM IN LEE. REALLY GOOD TO HAVE YOU IN STUDIO WITH US. YOUR COMMENTS ON POWELL’S COMMENTS? WHAT IS YOUR SENSE OF WHAT HE SAID? > > IT WAS -- IN OUR VIEW IT WAS CLEAR LAY DOVEISH COMMENT. HE -- FIRST OF ALL CHARACTER RISED IT AS RESTRICTIVE THAT MAYBE ACTUALLY HE HIMSELF AND OTHER MEMBERS ARE OPEN TO CUT -- ADDITIONAL CUTS EVEN AFTER THEY RESUME THE EASING PROCESS IN SEPTEMBER. AND ALSO THE FOCUS ON LABOR MARKETS AND POTENTIAL SOFTENING THERE, DESPITE THE WIDENING EXPECTED SPIKE IN INFLATION OVER THE NEXT 12 MONTHS. OVERALL IT’S SIGNAL THAT, YOU KNOW, A LOT OF MEMBERS IN ARE OPEN TO LOOK THROUGH THE INFLATION AND FOCUS ON THE LABOR MARKET AND CONSIDER QUITE A FEW RATE CUTS. NOW THIS IS MORE OR LESS IN LINE WITH WHAT WE HAD BEEN EXPECTING. WE HAD BEEN ARGUING FOR SIX RATE CUTS STARTING IN SEPTEMBER, THAT BRINGS THE FED FUND DOWN BY 3% BY THE END OF 2026. SO WE THINK THERE’S MORE OR LESS CONFIRMS THAT -- OF DOVEISH BIAS AT THE FED. IF YOU MIX IN A BIT OF POLITICAL PRESSURE FROM THE WHITE HOUSE WHICH WE THINK THERE’S A PRETTY LIKELIHOOD THAT WE GET MULTIPLE CUTS HERE. SO IT WAS A DOVEISH. DOVEISH SPEED. > > WHAT IS THAT GOING MEAN FOR ASHARKS CENTRAL BANKS AND ASSETS IN GENERAL? > > FIRST OF ALL, WE LIKE EMERGING MARKETS. AND WE ADDED OVERWEIGHT IN EMERGING MARKET HOT CREDIT. AND SO WE’RE ALSO BEARISH ON DOLLAR. SO OBVIOUSLY, ASIA IS PROUD OF THAT BROADER TREND IN MY VIEW. WHEN THE DOLLAR IS RANGE BOUND AND SOFT, IT MAKES THE JOB EASY FOR THE CENTRAL BANKS. SO WE DO EXPECT SOME ADDITIONAL RATE CUTS, YOU KNOW, FROM THE REGION CENTRAL BANKS INCLUDING BANK OF KOREA, EVEN THOUGH WE EXPECT A PAUSE IN THIS WEEK’S PARTICULAR MEETING. IT KEEPS THE OVERALL FUNDING CONDITIONS PRETTY EASY. SO WE THINK THE ASIAN ASSETS WERE CONTINUING TO GRIND UPWARD DUE TO THIS RELATIVEFULLY FAVORABLE -- THE TARIFF RATE RELATED NOISES WERE SLOWLY BEGINNING TO PUT IT BEHIND US. OVER THE CONTEXT, WE THINK IT’S RELATIVELY POSITIVE FOR THE ASIAN ASSETS. > > YEAH, THE PRESIDENT OF SOUTH KOREA HEADED TO WASHINGTON, D.C. TO TRY TO HAMMER OUT THE DETAILS OF THOSE NEGOTIATIONS. SAYING IT’S HARD TO AGREE TO THE FOLKS LITTLE IN. STATIONS IN SOUTH KOREA AND OUR 20,000-PLUS TROOPS AS HE HAS NOTE HAD THAT HE MAY WANT TO USE MORE ACROSS THE REGION. WE ARE WAITING DETAILS ABOUT THE $300 BILLION INVESTMENT FUND. WHAT’S THE RISK OF THIS MEETING IN WASHINGTON, D.C. PRESENTS FOR SOUTH KOREAN AND OTHER GLOBAL STOCKS. > > WELL, FIRST OF ALL, FOR A SOUTH KOREAN MARKET, OBVIOUSLY, THE DISPERSION OF POTENTIAL OUTCOME FROM THIS SENATE GIVEN MR. TRUNKS VOLATILE NEGOTIATION TACTICS. IT’S A RISK. WE NEED TO ACKNOWLEDGE THAT. IF YOU THINK ABOUT SOME OF THESE TARIFF THAT’S THE HAVE TO MAKE. PART OF THESE PROGRAMS ARE BASICALLY KOREAN GOVERNMENT FUNDING KOREAN BUSINESSES INVESTING INTO THE U.S. SO AS LONG AS THEY CAN KIND OF STICK TO THAT -- THE CORNICHE ACTIVE, WE THINK THAT THERE ISA WILLINGNESS AND SOLVE BASICALLY HAMMER THIS STILL -- BASICALLY FINALIZE THIS DEAL AND MAKE SURE THAT THERE ARE NO AUDITION UNTIL PUNITIVE TARIFFS. SO WE ARE STILL CONSTRUCTIVE ON THE POTENTIAL OUTCOME OF THE SUMMIT BETWEEN THE TWO COUNTRIES. WE’LL OBVIOUSLY HAVE TO SEE THE END RESULT AT THE END OF THIS SUMMIT. BUT -- IT REALLY DEPENDS ON THE OUTCOME. HE WOULD SIMPLY CONFIRM THAT YOU’RE MAKING FACE OF THE TRUMPIAN NEGOTIATIONS AN TARIFFS FOR THE OTHER MARKETS AS WELL. BUT OF COURSE, IF FAST A VERY DIFFICULT RESULT, THEN IT WILL HAVE SOME NEGATIVE IMPACT. WE’LL SIMPLY HAVE TO WAIT AND SEE. > > THAT’S WHAT I WAS CURIOUS. HOW MUCH OF THE RISK OR BEN FIFTHS ARE PRICED INTO THE MARKET AS OPPOSED TO EVERYTHING ELSE WAS GOING ON. BUT OF COURSE, WE HAVE NVIDIA, EARNINGS THIS WEEK AS WELL. > > SO FROM OUR PERSPECTIVE, THE COUNTRY’S TARIFFS ARE LIKELY FADING AS A MARKET. WE HAVE NO NUMEROUS BILATERAL DEALS THAT SIMPLY KEN THE TARIFF RATES AT THE AGREED LEVEL FOR THE FORESEEABLE FOUL. IN THIS RELATIONS BETWEEN U.S. AND CHINA, THIS EMERGENCE. GIVES US GREATER CONFIDENCE AND IT CAN KEEP THINGS WHERE THEY ARE. SO IN SOME SENSE MARKETS BASICALLY ASSUMING THAT THESE RATES WILL CONTINUE. IT’S NOT A TERRIBLE UNREASONABLE THINGS TO HAVE. THERE ARE CERTAINLY RISK ESPECIALLY FOR SEMICONDUCTORS. CONSUMER AND FILE A SUIT AT COLES. THERE HAS BEEN SOME SIGNALS. FOREVER IF SOME COMPANYS THAT INVEST IN THE U.S. FROM SOME OF THESE TARIFFS. SO WHEN WE THINK ABOUT A BASE CASE FOR TARIFF, SEG OR THE TARIFFS STILL MATTER. BUT ULTIMATELY, THE POLITICAL AND THIS ADMINISTRATION SOMETHING MORE PRAGMATIC. SEE WE ASK THAT AS PART OF OUR CASE. > > WHAT ARE YOU SEEING IN TERMS OF THE PROGRESS THAT’S BEING MADE IN TERMS OF SOUTH KOREA? SOME OF THESE CORPORATE RETURNS, TAX, PLANS? > > SO THE RULING PATIENT IS BACK AND NORTH ON CAPITAL GAINS TACK. BUT OUR GUESS IS THAT THEY’RE POLITICALLY ATTACHED TO -- IT STILL MATTERS. AND IT’S GOING TO BE A MARKET, AND SO WE DO THINK SOME FAVORABLE THRESHOLD. AND ALSO AS PART OF COMMERCIAL CODE AS CONCERNED THAT’S BASICALLY THE HEART OF THE. WE THINK IN THE SIMILAR INTEREST OF THE RULING PARTY WHICH HAS BEEN FAVORED TO THE MINORITY OF THE SHAREHOLDERS TO FORGE AHEAD ON THE ISSUES THAT THE TREASURY STOCK HAS ON CUMULATION AND OTHER ISSUES THAT ARE IMPORTANCE FOR THE CORRESPONDENT GOVERNMENT. SO IF YOU COMBINE SLIGHTLY MORE MARKET-FRIENDLY ON THESE TAX MEASURES. AND ALSO POSSIBILITY OF A GREATER PERSON FOR CORPORATE GOVERNS NANCE REFIRM. WE THINK THE PILLAR IS STILL THERE. THAT’S THE REASON WHY WE WRECK THE COUNTRY WITH THE MOST FAVORITED EMERGING MARKET ON OTHERS. > > IS SOUTH KOREA UNDER PINNING ON ALL THAT. BUT DO YOU THINK E.M.’S CAN OUTPERFORM D.M.’S THIS YEAR. > > > > THAT’S HOW CHINA’S FAIRLY STRONG PERFORMANCE IN THE FIRST HALF, WE SEE SLIGHTLY, WE SEE A REMAINING UPSIDE. DOLLAR, SOFT DOLLAR AND RANGE DOLLAR ENVIRONMENT HELPS KEEP THE CONDITIONS PRETTY EASY. AND ALSO, THE ASSETS ARE QUITE SHAPEDDED. WHEN YOU HAVE A SHIFT IN THE INVESTOR PRO PERSIAN -- THESE ECONOMIES GOING FORWARD. WE THINK THERE’S A REMAINING UPSIDE. THAT’S THE REASON WHY WE’RE GOING TO HAVE IT. SET. > > GOOD TO HAVE YOU WITH US. SENIOR MARKET STRATEGIST. WE DO HAVE BREAKING NEWS ON THE BLOOMBERG. WE’RE HEARING THAT BUYOUT FIRM TUMO BRAVO IS NEARING A DEAL TO RECEIVE A SALT NETWORK. THEY’RE SAYING THAT THE DEAL WOULD HAVEN’T AT ABOUT $2 BILLION. I WOULDN’T INCLUDE DEBT. AN AGREEMENT COULD BE ADAMANCED AS SOON AS MONDAY. NO FINAL DECISION HAS BEEN MADE. BUT DISCUSSIONS COULD FALL THROUGH ACCORDING TO SOURCES. BUT BLOOMBERG NEWS SAID THAT THE TWO ARE TALKS. AND IS NEARING THAT DEAL TO ACQUIRE THAT INASSISTANCE A SOFTWARE MAKER. NOW WE ARE WATCHING INTEL BECAUSE THEY HAD AN UNPRESS DENNED DEAL GIVEN A 10% STAKE IN THE CHIPMAKER. BY CHIPS AND GRANTS MARKS A MORE THAN 5% ON THE NEWS, THOUGH, ANALYSTS WARN MONEY ALONE WON’T SOLVE YEARS OF LOST GROUND TO RIVALS. > > YOU KNOW WHAT? I THINK AMERICA SHOULD BE GIVEN 10% OF INTEL. I WOULD CONSIDER. THAT I WOULD LIKE YOU TO DO THAT BECAUSE IT’S NO HOSPITAL LEFT BLIND. SHERY: BEAT ESTIMATES. THERE WAS AN EXPECTATION THAT A SALES DECLINE COULD DRIVE SALES DOWN. BUT IS IT GOING AGAINST THE INVESTOR EXPECTATION. CLIMBING ABOUT 1%. AND INVEST OF THES ALSO HAVE BEEN WATCHING OUT FOR THE LATEST DEVELOPMENT WHEN IT COMES TO AN ABU DHABI CONSORTIUM. IT IS CLIMBING ABOUT THREE-PLUS PERCENT AND THIS IS DESPITE IT’S FIRST LOSS IN FOUR YEARS IN THE GREEN AT THE MOMENT. AND AMONG THE STOCKS WE’RE WATCHING IN AUSTRALIA. MORE AHEAD ON THE ASIA TRADE. THIS IS BLOOMBERG SHERY: SOUTH KOREA AND JAPAN HAVE AGREED TO STRENGTHEN TIES FOLLOWING A WEEKEND MEETING BETWEEN THEIR LEADERS AND KOREAN PRESIDENT IS NOW IN WASHINGTON FOR TALKS WITH PRESIDENT TRUMP LATER MONDAY. OUR CHIEF NORTH ASIAN CORRESPONDENT STEVEN ENGEL JOINS FROM US HONG KONG. TALK TO US WHAT STOOD OUT FROM THE WEEKEND TALKS, STEVE? STEPHEN: THERE WASN’T A LOT SAID. I’M TALK ABOUT YI AND ISHIBA. THEY HAD TWO MINUTES OF TALK IN TOKYO AHEAD OF THE SOUTH KOREAN PRESIDENT HEADING TO WASHINGTON WHERE HE IS THERE NOW. HE WILL BE MEETING TRUMP IN THE WHITE HOUSE LATER ON MONDAY. THEY BOTH AGREED TO CONTINUE AND ALSO REAFFIRM THE NEED TO TACKLE SHARED CHALLENGES. PRETTY VAGUE STATEMENTS ENTIALLY. BUT THERE IS INCREASING CERTAINTY ABOUT TRADE POLICIES AND SECURE THE ALLIANCES IN EAST ASIA. AND OF COURSE, AT THE BACKDROP OF THAT IS THE WHOLE NORTH KOREAN ISSUE. KEEP IN MIND, YOU HAVE THREE NEW LEADERS IN THESE THREE COUNTRIES, THE UNITED STATES, SOUTH KOREA AND JAPAN. THEY REACHED A TRILATERAL REPROCHMOND IN TERMS OF THESE THREE COUNTRIES. NOW YOU HAVE THE THREE NEW LEADERS. THE DYNAMICS ARE DIFFERENT. OF COURSE, PRESIDENT YI AND ISHIBA WOULD GET ALONG AND BE ON THE SAME PAGE ON ECONOMIC ISSUES TRADE, ISSUES AND SECURITY ISSUES. PRESIDENT SI PICKED HIS, BRAIN ABOUT DONALD TRUMP. HE HAS HAD MULTIPLE PHONE CALLS WHEREAS E IS MORE NEW TO THE OFFICE IN SEOUL AND GOING TO WASHINGTON, D.C. HAVING STRUCK A TRADE DEAL JUST IN JULY THAT THERE’S STILL A LOT OF UNCERTAINTY GOING FORWARD. THINK I THIS IS THE SMALLER BILAT IN TOKYO AND THE BIGGER BILAT IS COMING UP IN THE WHITE HOUSE. > > YEAH, AND THAT REPORT WITH PRESIDENT TRUMP SO IMPORTANT, RIGHT? WE’RE ALREADY SEEING PRESIDENT E TALKING ABOUT U.S. FORCES IN SOUTH KOREA. SUCH AN IMPORTANT SECURITY ASPECT THAT NEEDS TO BE DISCUSSED ON TOP OF WHAT YOU MENTIONED, THE TRADE DEAL. WE STILL HAVE TO GET THE SPECIFICS. > > YEAH, THAT’S RIGHT. AND THERE’S BEEN A LOT OF PLEDGES MADE INCLUDING PLEDGES BY SOUTH KOREA TO HELP AMERICA’S SHIP BUILDING BECOME GREAT AGAIN. THERE WAS ABOUT 50 BILLION PLEDGED IN INVESTMENT PLEDGES BY THE SOUTH KOREAN AS PART OF THAT TRADE DEAL THAT EVENTUALLY -- ESSENTIALLY SOLIDIFIED 15% TARIFF ON THE SOUTH KOREANS. YOU MENTIONED ABOUT THE TROOPS IN SOUTH KOREA. DONALD TRUMP HAS BEEN A BIG CRITIC NOT PONYING UP ENOUGH FOR PAYING FOR ITS OWN SECURITY AGAINST THE BACKDROP OF THE THREAT FROM NORTH KOREA. WE’RE HEARING THE PRESIDENT WILL URGE DONALD TRUMP TO, YOU KNOW, REACH OUT AGAIN TO THE NORTH AND I’M NOT SAYING HAVE ANOTHER SUMMIT BECAUSE DONALD TRUMP HAD THREE MEETINGS ALREADY WITH KIM JONG-UN IN HANOI BETWEEN NORTH AND SOUTH KOREA, BUT HE DID NOT MAKE ANY PROMISES OR DID NOT COME THROUGH WITH ANOTHER PROMISES TO CURTAIL HIS NUCLEAR AMBITION. SO AGAIN, WE’LL HAVE TO SEE. THAT COULD BE HEADLINES COMING OUT OF THAT MEETING IN THE WHITE HOUSE. BUT AGAIN, YOU’RE ABSOLUTELY RIGHT. DETAILS ON THIS TRADE DEAL AND ANY KIND OF REASSURANCES THAT DONALD TRUMP CAN GIVE ON THE SECURITY ALLIANCES, THE TRY LATERAL AGREEMENTS. LONG-TIME SECURITY ALLIES, OBVIOUSLY. SOUTH KOREA AND THE UNITED STATES AND JAPAN AND THE UNITED STATES. SO AGAIN, A LOT OF QUESTION MARKETS MARKS STILL JET TO BE ANSWERED GOING FORWARD WITH THAT MEETING IN D.C. > > WE’LL HAVE MORE ON WHAT TO EXPECT FROM THE U.S.-SOUTH KOREAN SUBMIT. THERE IN THE COMING HOURS. JOINS US TO DISCUSS THE PRESIDENT’S VISIT TO WASHINGTON, D.C. AND TAKE A LOOK AT HOW FUTURES ARE TRADING. EUROPEAN FUTURES TO THE DOWN SIDE OF 1.1. THE U.S. DOLLAR SINKING ON THE OTHER SIDE OF THAT TRADE. WE HAD SEEN CHAIR POWELL’S COMMENTS REALLY TAKING THE GREEN BACK LOWER BUT ALSO PRESIDENT TRUMP’S COMMENTS THAT HE WOULD FIRE IF SHE DOES NOT RESIGN WEIGHING ON THE DOLLAR. LA GAAR TALKING ABOUT N THE MARKET. WE HAVE MORE AHEAD. THIS IS BLOOMBERG. > > NOW WE’VE BEEN WATCHING MEN TREMENDOUS FROM COMMENTERS AT JACKSON HOLE INCLUDING REMINDING MARKETS THAT THEY ARE INCHING HIGHER AMID A TIGHT LABOR MARKET. CEMENT SOME OF THESE EXPECTATIONS OF A D.O.J. RATE HIKE. WE ARE SEEING THAT PRESSURE ON THE U.S. 10-YEAR -- A BIT OF A REARS ARE VERSAL FROM FRIDAY’S SESSION WHERE WE SAW THIS BUYING LED BY THE SHORT END ON U.S. TWO YEARS IN PARTICULAR, BUT GIVING SOME POINTS NOW AT THE MOMENT, THE FED HIGHLIGHTED THAT IT’S GOING TO BE DATA-DEPENDENT. THAT SEEMS TO BE THE TAKEAWAY AS WELL. THAT BEING SAID, WE ARE SEEING MOSTLY ACROSS THE G-10 INCLUDING IN JAPAN, THE 10 YEARS CLIMBING AGAINST THE BACKDROP OF WHAT WE GOT FROM THE FEDERAL RESERVE IN THE MEANTIME, FORMER FED PRESIDENT BULLOCK SAYS THERE’S A CASE FOR 100 BASIS POINTS FOR NEXT YEAR. HE’S A CONTENDER TO SUCCEED JAY POWELL. HE CLAIMS HE PUT A SEPTEMBER CUT ON THE TABLE. > > HE USED THE SPEECH TO SOLIDIFY EXPECTATIONS FOR 25 BASIS POINTS IN SEPTEMBER. I WAS EXPERTING THAT ANYWAY. MARKETS WERE EXPECTING THAT. HE LEANED INTO THE MOST RECENT LABOR MARKET REPORT WHICH WAS VERY SOFT. AND SO I THINK THAT’S -- THAT’S A DONE DEAL. HE DIDN’T SAY TOO MUCH ABOUT BEYOND THAT. WHAT YOU WANT TO DO AT THE OCTOBER MEETING OR THE DECEMBER MEETING. I HAD SET UP 100 BASIS POINTS, YOU KNOW, GOING INTO 2026. I THINK YOU COULD ADJUST AS YOU GO FORWARD AND -- AND EVENTUALLY GET A FEW 100 BASIS POINTS BUT I WOULD GO SLOWLY. AND THEN ON THE FRAMEWORK REVIEW, I’M SURE MUCH EARLIER IN THE YEAR, THEY HAD TARGETED THAT THEY WOULD HAVE THE FRAMEWORK DISCUSSION AND THAT THEY WOULD USE THE JACKSON HOLE SPEECH TO TALK ABOUT CHANGES FOR THE FRAMEWORK. I THOUGHT THOSE WERE THOUGHTFUL AND WELL-PRESENTED IN THIS SPEECH. AND THEY’RE ABOUT MANY HAVE SPECULATED ON. I THINK THEY DID ABOUT AS MUCH AS THEY CON THE FRAMEWORK SIDE. > > G GOOD MORNING TO YOU. I DEFINITELY CONSIDER THIS MY CONVERSATION OF THE DAY. YOU SERVE A LENGTHER LENGTHY TERM AT THE ST. LOUIS FED. YOU HAVE LIVED THE DECLINE OF A GREATER ECONOMY. DECADES AND DECADES AGO IN THE EFFORT TO PROVIDE FOR A A RESURGENT ST. LOUIS. IS THE NEXT CHAIRMAN OF THE FED, WHOEVER THAT MAY BE, DO THEY HAVE TO MANAGEMENT FOR TWO AMERICAN ECONOMIES ACTION TECHNOLOGY DRIVEN, EXCEPTIONAL ECONOMY AND AMERICA FLAT ON THEIR BACK? HOW WOULD A CHAIRMAN EXECUTE THOSE TWO AMERICAS? > > I THINK INCOME AND WEALTH DISTRIBUTION HAVE BECOME MORE SALIENT TOPICS IF THE FED. IT’S NOT THAT CLEAR WHAT THE FED CAN REALLY DO PROVIDING INTEREST RATE FOR THE WHOLE ECONOMY IF YOU CHANGE THE RATE STRUCTURE, THAT AFFECTS EVERYONE. NOT JUST ONE PARTICULAR GROUP THAT YOU MIGHT BE TARGETING. SO I THINK THAT’S BEEN SOMETHING WE’VE HAD TO WRESTLE WITH. AND I’VE ACTUALLY DONE RESEARCH ON IT MYSELF TO TRY TO UNDERSTAND IT BETTER FROM MY POINT OF VIEW. SO I THINK THERE’S BEEN A THEME FOR A WHILE. AND THAT WILL BE AN IMPORTANT THEME NOW GOING FORWARD. > > FORMER ST. LOUIS FED PRESIDENT JAMES BULLARD SPEAKING TO TOM KING. THIS IS BLOOMBERG > > SOME TOP STORIES WE ARE FOLLOWING, CANADIAN PRIME MINISTER MARK CARNEY VISITED KYIV ON UKRAINE'S INDEPENDENCE DAY PLEDGING SUPPORT FOR AS LONG AS IT TAKES. SPEAKING ALONGSIDE PRESIDENT VOLODYMYR ZELENSKYY, MARK CARNEY SAID PEACE IN RUSSIA MUST COME THROUGH STRENGTH. CANADA ALSO ANNOUNCED MORE THAN 1.4 BILLION DOLLARS IN MILITARY AND RECONSTRUCTION AID. PRESIDENT ZELENSKYY SAYS SECURITY GUARANTEES FOR A POSTWAR UKRAINE WILL BE READY IN DAYS. IN A POST ON TWITTER AFTER MEETING WITH THE DUTCH PRIME MINISTER, ZELENSKYY ADDED THAT UKRAINE IS READY FOR PEACE AND ACCUSED RUSSIA OF SHOWING NO INTENTION. MEANWHILE RUSSIA AND UKRAINE EXCHANGED 146 PRISONERS EACH IN A DEAL BROKERED BY THE UAE. OF COURSE GEOPOLITICS ALWAYS IN THE BACKDROP WHEN IT COMES TO SOME OF THESE MARKET MOVES. WE ARE WATCHING OUT FOR WHAT WE CAN POTENTIALLY GET IN TERMS OF THE U.S. AND SOUTH KOREA. DO WE SEE MORE DETAILS ON INVESTMENT DEALS? FOR THE MOMENT THE SOUTH KOREAN BENCHMARK IS IN THE GREEN HELPED ALONG WITH WHAT WE GOT FROM THE FEDERAL RESERVE. SHERY: YEAH. AS WE ARE ALSO WATCHING THE GEOPOLITICAL BACKDROP FROM SOUTH KOREA WITH THE PRESIDENT SCHEDULED TO MEET WITH PRESIDENT TRUMP IN WASHINGTON MONDAY WITH TRADE NEGOTIATIONS AND THE FUTURE OF THEIR ALLIANCE TOPPING THE AGENDA. THE VISIT COMING ON THE HEELS OF THE MEETING WITH THE JAPANESE PRIME MINISTER WHERE BOTH LEADERS PLEDGED TO STRENGTHEN TIES AND ENHANCE TRILATERAL COOPERATION WITH THE U.S. LET'S GET MORE WITH PRESIDENT FREE-TRADE STRATEGY AND INNOVATION HUB. HE WAS PREVIOUSLY CHIEF NEGOTIATOR FOR KOREA AT THE WT L. IT IS GREAT TO HAVE YOU WITH US. WELCOME TO THE SHOW. LET ME GET STARTED BY ASKING HOW IMPORTANT IT IS FOR SOUTH KOREA TO GET MORE CLARITY WHEN IT COMES TO REAL THE FUNCTION OF THAT $350 BILLION FUND WHEN IT COMES TO INVESTMENTS INTO THE UNITED STATES AND HOW THE PROFITS WILL BE DIVIDED. CHOI: YEAH. THE QUESTION IS WE HAVE A VERY IMPORTANT TRADE DEAL WITH WAS REACHED IN LATE JULY. THIS SUMMIT IS TAKING PLACE IN THE BACKDROP OF THAT IMPORTANT TRADE DEAL. THE PROBLEM IS THE TWO SIDES HAVE DIFFERENT INTERPRETATIONS. THE FORTHCOMING SUMMIT BETWEEN LI AND TRUMP, THEY WILL TRY TO IRON OUT ANY DIFFERENCES, ESPECIALLY FOCUSED ON THE SHIPPING INDUSTRY. MAKE AMERICAN SHIPPING GREAT AGAIN. ON TOP OF THAT, SOME TRADE ISSUES. KOREA AGREED TO REDUCE AUTOMOBILE TARIFFS AND SEMICONDUCTOR TARIFFS TO SOMETHING LIKE 15% BUT THE TIMEFRAME HAS NOT BEEN DECIDED. SO FROM THE KOREAN PERSPECTIVE IT IS VERY IMPORTANT FOR THEM TO PIN DOWN THE EXACT DATE. SHERY: WHAT WOULD A WIN FOR THE PRESIDENT IN THIS SUMMIT LOOK LIKE? WHAT DOES HE NEED TO ACHIEVE? CHOI: WHEN YOU CONSIDER THE SITUATION IN LATE JULY, JAPAN AGREED A DEAL AND THE EU AGREED FOR A DEAL. FROM KOREA'S PERSPECTIVE THEY NEED TO PUT A LOT OF INVESTMENT PACKAGE TO MAKE SURE TRUMP WILL DECLARE A TRADE DEAL. BUT BECAUSE OF TIME PRESSURE IT LOOKS LIKE THEY COULD NOT IRON OUT DIFFERENCES. IT IS TIME TO IRON OUT WHAT CAN BE DONE. FROM THE U.S. PERSPECTIVE THEY WANT TO PUT THE MONEY IN SEMICONDUCTORS AND BATTERIES AND ENERGY. THE PROBLEM IS THE STRUCTURE INVESTMENT, PRESIDENT TRUMP SEEMS TO HINT HE CAN DICTATE ALL THE TERMS AND CONDITIONS OF INVESTMENT THE KOREAN PRESIDENTIAL OFFICE INTERPRETS DIFFERENTLY. THIS IS TIME FOR THEM TO MEET AND NARROW DOWN DIFFERENCES. WE ARE VERY CURIOUS AT THE END OF THE SUMMIT THEY WILL COME OUT WITH A JOINT STATEMENT, JOINT DECLARATIONS. BUT CONSIDERING THE PROCESS LEADING UP TO THIS SUMMIT, THERE IS A POSSIBILITY WE NEED MORE TIME. AVRIL: YOU TALK ABOUT THE TIME PRESSURE FROM PERHAPS PREVENTING A BIT OF THE TRADE DETAILS. ONCE THOSE PACKS WERE SIGNED. BUT WE KNOW HOW TRADE DEALS ALSO TAKE YEARS, AS YOU WELL KNOW, TO IRON OUT. WHAT IS YOUR SENSE OF POTENTIALLY IN A BILATERAL THAT THERE IS ENOUGH TIME, ESPECIALLY SINCE TRUMP DOES SEEM TO BE USING TARIFFS AS A BARGAINING CHIP? CHOI: YEAH, IT IS RIGHT. YOU HAVE TO UNDERSTAND WHAT IS HAPPENING IS NOT JUST BETWEEN KOREA AND THE UNITED STATES. MR. TRUMP SINCE APRIL 2, HE DECLARED LIBERATION DAY FOR THE U.S. HE IS NEGOTIATING WITH SO MANY COUNTRIES AT THE SAME TIME. FROM KOREA'S PERSPECTIVE IT IS BILATERAL BUT KOREA SHOULD BE MINDFUL BEFORE KOREA, MANY COUNTRIES HAD WHICH DEAL AND AFTER KOREA STILL MANY COUNTRIES LINED UP TO NEGOTIATE A DEAL INCLUDING COUNTRIES LIKE INDIA AND TAIWAN. MAYBE CHINA IS ALSO ON THE LINE. KOREA NEEDS TO PLAY NEGOTIATIONS AND BE MINDFUL OF THE POSSIBILITIES. FROM THE NEGOTIATING PERSPECTIVE THEY WANT TO MAKE SURE THAT DEAL OR THE AGREEMENT THEY GET WITH MR. TRUMP WILL NOT BE MORE DISADVANTAGEOUS. HE HAS HINTED TARIFFS SOMEWHERE UP TO 300%. EVEN ALL THOSE GLOBAL COMPANIES WHICH PLEDGED INVESTMENT IN THE U.S. THAT ARE EXEMPTED BUT THAT DOES NOT CLEAR THE POSSIBILITY WHAT IF IT COULD BE LIKE SAMSUNG, WHICH IS EXPORTING OUTSIDE OF THE U.S. AND IMPORTING TO THE U.S., IS IT EXEMPTED TO TARIFFS OR THE SUBJECT TO JUST 100%, OR 15%? ALL OF THOSE ARE SPECULATIONS. ALSO YOU HAVE TO UNDERSTAND, TRUMP IS STILL HINTING AND MORE POSSIBLE TARIFFS ON FURNITURE AND SO ON AND SO FORTH. THE FACT A DEAL HAS NOT BEEN DECLARED DOESN'T MEAN THE END OF THE ROAD BECAUSE WE HAVE SO MANY THINGS TO GO FURTHER. AVRIL: HELP US UNDERSTAND THE APPETITE FROM SOUTH KOREAN COMPANIES POTENTIALLY FOR INVESTING INTO THE U.S. AMONG THE SECTORS INCLUDING SHIPBUILDERS, WHICH ARE AS WE KNOW, TOP OF THEIR CLASS. WHAT IS IN IT POTENTIALLY FOR THEM? CHOI: WELL, ACCORDING TO NEWS REPORTS AND ALL THESE KOREAN COMPANIES, THE SO-CALLED CARD KOREA HAD IS SHIPBUILDING. THIS IS THE TIME FOR SO-CALLED ECONOMIC SECURITY. WE UNDERSTAND THE ONGOING COMPETITION BETWEEN THE U.S. AND CHINA. FROM THE U.S. PERSPECTIVE, THERE SHIPPING AND BUILDING CAPACITY IS DECLINING AND KOREA CAN MAKE THAT CAPACITY INNOVATIVE USING KOREA'S MANUFACTURING CAPACITY. AND KOREA EARMARKED SOMETHING LIKE BILLION TO 5 BILLION IN SHIPBUILDING CAPACITY. BUT TO MAKE IT HAPPEN, THE U.S. NEEDS TO REVAMP ISSUES. WHETHER OR NOT THEY CAN COME OUT OF THIS SUMMIT WITH A TANGIBLE DELIVERABLE, INCLUDING A U.S. PROMISE IS SOMETHING TO SEE. SHERY: YOU MENTIONED THE POWER DYNAMICS AND HOW THAT COULD AFFECT THE TALKS AS WELL. EVEN WHEN IT COMES TO SHIPBUILDING WE SAW FEES COMING FROM THE U.S. ON CHINESE-BUILT SHIPS DOCKING IN THE U.S. IN WHAT OTHER AREAS COULD SOUTH KOREA BENEFIT FROM THE DIFFERENT POWER DYNAMICS AT PLAY RIGHT NOW GEOPOLITICALLY? CHOI: WELL, YOU SEE, THE SEMICONDUCTOR AND BATTERIES ON THE TOP OF THE NEGOTIATIONS. LOOK, KOREA HAS EMERGED THE TOP INVESTING COUNTRY TO THE USA IN THOSE SEMICONDUCTOR BATTERIES. WHICH IS ALSO AT THE CENTER OF THE POWER COMPETITION BETWEEN CHINA AND THE USA. SAMSUNG, SK HYNIX, THEY PUT A TREMENDOUS AMOUNT OF MONEY IN THE USA. THEY OBVIOUSLY BENEFITED FROM THE BIDEN-ERA CHIPS ACT. THE TRUMP ADMINISTRATION CHANGED THE TONE, SO THEY MAY WANT A DEAL, DEMANDING MORE INVESTMENT IN THE USA, SEMICONDUCTORS. WHETHER THAT IS GOING TO BE DONE OR NOT IS A VERY SERIOUS CONSIDERATION. OBVIOUSLY THAT IS AN AREA KOREA SHOULD HAVE A LOT OF BENEFIT IN. AVRIL: IT HAS BEEN REALLY GOOD TO GET YOUR INSIGHTS. THANK YOU SO MUCH FOR JOINING US. CHOI BYUNG-IL IS PRESIDENT OF TRADE STRATEGY AT INNOVATION HUB. MORE AHEAD ON "THE ASIA TRADE." THIS IS BLOOMBERG. ♪ AVRIL: EVERGRANDE WILL BE REMOVED FROM THE HONG KONG STOCK EXCHANGE TODAY, 1.5 YEARS AFTER SHARES WERE TO'S -- SUSPENDED AND ALMOST 16 YEARS AFTER IT WAS LISTED. LET'S BRING IN MINMIN LOW FROM BEIJING. WE'VE BEEN TALKING ABOUT THIS DELISTING. THE DAY HAS COME. WHAT HAPPENS NEXT? MINMIN: I AM SURE A LOT OF EQUITY HOLDERS WILL BE WONDERING WHAT IS GOING TO HAPPEN TO THEIR ASSETS. THERE IS STILL A LONG LIST OF CREDITORS THAT ARE WAITING TO GET THEIR MONEY BACK AS WELL. THE LIQUIDATION HEARING WILL CONTINUE SEPTEMBER 2 IS THE DAY TO WATCH. THAT IS WHEN LIQUIDATORS WILL LIKELY GO AFTER THE FOUNDER HIMSELF AND THEY HAVE TO CONVINCE THE HIGH COURTS TO BASICALLY FORCE THE FOUNDER TO DISCLOSE HIS ASSETS BECAUSE SO FAR THE TRIALS HAVE FOCUSED ON THE EX-WIFE AND THE CEO, BOTH OF WHOM HAVE USED A VARIETY OF WAYS TO TRY AND DELAY THE DISCLOSURE OF THEIR ASSETS BUT EVENTUALLY THEY WERE NOT ABLE TO AVOID IT. AND THAT HAS HELPED LIQUIDATORS UNCOVER A LOT OF ASSETS INCLUDING AN ASTONISHING AMOUNT OF EXPENSES AT WORK AS WELL AS LUXURY PROPERTIES AROUND THE WORLD. HE IS SAID TO HAVE POCKETED ABOUT $7 BILLION OVER THE PAST DECADE THANKS TO THE DIVIDENDS AND GENEROUS PAYOUTS FROM THE COMPANY. IT IS ESTIMATED TO BE ABOUT 1/8 OF THE TOTAL DEBT THAT THE COMPANY OWES, WHICH IS $45 MILLION, HIGHER THAN ANTICIPATED. LIQUIDATORS NOW SAY THERE IS NO HOLISTIC WAY TO RESTRUCTURE THE COMPANY. THAT IS NOT WITHIN REACH. ANOTHER CHALLENGE FOR OFFSHORE CREDITORS IS THAT A LOT OF THE ASSETS THAT ARE ON THE MAINLAND WILL BE VERY HARD FOR THEM TO ACCESS BECAUSE IT IS A DIFFERENT JURISDICTION. YOU ADD TO THAT THE COMPLEXITY OF THE ORGANIZATION ITSELF, IT HAS 3000 LEGAL ENTITIES ACROSS DIFFERENT JURISDICTIONS, THOUSANDS OF PROJECTS ONGOING IN DIFFERENT CITIES. IT IS REALLY A VERY COMPLEX UNDERTAKING TO GO THROUGH ALL OF IT. SHERY: THE WOES AROUND THE PROPERTY SECTOR CONTINUE AS WELL. COUNTRY GARDEN PRELIMINARY EARNINGS OUT, THEY DO NOT LOOK GOOD. MINMIN: THE PRELIMINARY EARNINGS FOR THE FIRST HALF EXPECTED TO HAVE WIDENED TO $3 BILLION IN LOSSES. THAT IS HIGHER THAN THE LOSSES THEY SUFFERED A YEAR EARLIER. THIS COMES AGAINST THIS BACKDROP OF THE BROADER HOUSING DATA LOOKING PRETTY NEGATIVE AS WELL. HOME SALES DOWN 20% OR MORE OVER THE PAST COUPLE MONTHS. HOME PRICES CONTINUING TO ACCELERATE -- DECLINED AFTER IT RECOVERED FOR A TIME. IT LOOKS LIKE WE ARE SEEING BACKSLIDING IN THE PROPERTY RECOVERY. UBS AS WELL HAS DELAYED THEIR FORECAST OF THE RECOVERY IN THE SECTOR TO MID TO LATE 2026. AND IF HOME PRICES ARE FALLING, THAT EATS INTO PROFIT MARGINS OF COMPANIES LIKE COUNTRY GARDEN AND IT IS ALREADY STRUGGLING TO RESTRUCTURE ITS DEBT. IT DEFAULTED ON A DOLLAR BOND PAYMENT IN 2023. THE COMPANY SAYS IT IS IN TOUCH WITH STAKEHOLDERS. PREVIOUSLY LAST MONTH AND AGREED TO SOME RESTRUCTURING TERMS REQUESTED BY SOME BANK CREDITORS SO THAT PUTS IT ON ITS WAY TO PERHAPS REACH A BROADER DEBT DEAL. BUT OVERALL THE SECTOR IS NOT DOING TOO WELL. SHERY: MINMIN LOW THERE. OF COURSE THE PROPERTY SECTOR WEIGHING ON THE CHINESE ECONOMY, ALSO THE U.S. TARIFFS. AND IN SPITE OF ALL OF THAT CHINA'S STOCKS EXTENDING THEIR BULL RUN. THIS DISCONNECT IS RAISING DOUBTS ABOUT THE RALLY'S STAYING POWER. WINNIE HSU JOINS US NOW FROM HONG KONG. HOW CONCERNED ARE INVESTORS ABOUT THIS DIVERGENCE BETWEEN CHINA'S ONSHORE STOCK RALLY AND WEAK ECONOMIC ENVIRONMENT. WINNIE: THAT HAS BEEN A KEY DISCUSSION TOPIC AMONG INVESTORS. WE WERE HEARING THAT FROM THE LIKES OF BANK OF AMERICA. THEY SAID WHILE THEY WERE TALKING TO MAINLAND INVESTORS, THAT IS THE BIGGEST CONCERN THEY ARE HAVING. THE BIG GAP WE'RE SEEING BETWEEN THE MACRO BEARS AND THE MARKET BULLS. THAT IS DIVERGING RIGHT NOW. AND THAT IS GIVING SOME PEOPLE A FLASHBACK OF WHAT HAPPENED IN 2015, THE BOOM AND BUST. THIS QUESTION ABOUT IF A RALLY IS ACTUALLY GOING TO BE SUSTAINABLE DURING A DEFLATIONARY ENVIRONMENT IS BEING DISCUSSED AMONG A LOT OF ECONOMISTS RIGHT NOW. AND ACTUALLY, WE DON'T REALLY SEE A BULL MARKET AND A DEFLATIONARY ENVIRONMENT COEXISTING. THAT IS MAINLY BECAUSE DURING A DEFLATIONARY PERIOD, THAT'S GOING TO HURT COMPANY'S PRICING POWER, AND HENCE, THEIR PROFIT MARGINS. SO WHAT WE ARE SEEING RIGHT NOW IS KIND OF AN EARLY SIGN OF A BUBBLE AS WE TALKED TO ONE OF THE KEY STRATEGISTS LAST WEEK WHO CALLED THE BOOM AND BUST OF 2015. HE SAID WE ARE SEEING ELEMENTS OF THE BUBBLES, THE ELEMENTS BEING FIRST LIQUIDITY AND ALSO THE RETAIL FRENZY. ALTHOUGH IT IS NOT THERE, WE ARE SEEING SOME EXCITEMENT AMONG RETAIL INVESTORS. ALSO THE BIG PICTURE PEOPLE ARE LOOKING FOR. THIS TIME IT IS IMPROVEMENT OF THE RELATIONSHIP BETWEEN THE U.S. AND CHINA. WHILE HE IS FORECASTING IT MIGHT BE 5000 AT THE LEVEL WE ARE GOING TO CALL A BUBBLE, THERE ARE SOME ELEMENTS OF THAT STARTING TO EMERGE. AVRIL: RIGHT. YOU GIVE US A GOOD REMINDER OF HOW THE FUNDAMENTALS DON'T REALLY MATCH THE STOCK MARKET MOVES. IN THE SHORT-TERM, IS THERE FURTHER TO GO ON THE UPSIDE? WINNIE: ABSOLUTELY. WHILE IT IS GIVING PEOPLE SOME FLASHBACKS OF WHAT HAPPENED IN 2015, MANY ARE STILL SAYING THIS TIME IT IS MORE SUSTAINABLE. AS YOU JUST MENTIONED, FROM THE TECHNICAL SIDE OF THINGS, THE RETAIL INVESTOR SENTIMENT IS THERE, BUT THIS TIME THE PACE IS SLOW AND ALSO WE ARE SEEING THE BROADENING OF THE RALLY. SO WE ARE ALSO HAVING A LOT OF THE SAVINGS OF HOUSEHOLDS STILL SITTING THERE. SO MORE UPSIDE TO COME WHEN IT COMES TO DEPLOYING THAT MONEY FROM SAVINGS INTO INVESTMENT IN STOCKS. AND ALSO THE ROTATION OF INSTITUTIONAL INVESTORS GOING FROM BONDS TO EQUITIES. FROM THAT ASPECT, WE ARE SEEING MORE UPSIDE. WHEN YOU ALSO LOOK AT THE DIFFERENCES AGAINST 2015, THERE ARE SOME STRUCTURAL CHANGES WE SAW IN THE PAST DECADE. BE IT ADVANCEMENT IN ARTIFICIAL INTELLIGENCE AS WE SAW IN DEEPSEEK AND ALSO THE BIOTECHS THIS YEAR. ALSO THE POLICY TONE IS MORE DIFFERENT THIS TIME WITH THE GOVERNMENT SAYING IT IS GUIDING LONG-TERM MONEY INTO INVESTING INTO EQUITIES. SO IT SEEMS LIKE THIS TIME WE HAVE A MORE FAVORABLE ENVIRONMENT. BUT JUST TO KEEP IN MIND WHEN WE THINK ABOUT WHAT HAPPENED TO JAPAN, SOME PEOPLE WERE TALKING ABOUT THIS AS THE JAPAN AFFECTATION OF CHINA. IT WAS IN THAT LAST DECADE, THAT LAST THREE DECADES, UNTIL THAT INFLATIONARY CYCLE REALLY KICKED IN IN 2024 FOR THE STOCK MARKET TO REACH THE RECORD HIGHS. SO THERE ARE SOME LESSONS WE CAN LEARN FOR THE CHINESE STOCKS. SHERY: WE ARE ALSO WATCHING THE HANG SENG INDEX AND HEARING THAT POT MARK, THE MAKER OF THE FAMOUS BLUE BOO-BOO DOLLS, HAS BEEN INCLUDED OF THE INDEX? WINNIE: YES. ANALYSTS HAVE BEEN TALKING ABOUT THE INCLUSION OF POP MARK -- POP MART FOR A COUPLE QUARTERS. FINALLY BECAUSE OF HOW MUCH THE STOCK HAS SURGED AND KIND OF THE CHANGE OF THE PATTERNS WHEN IT COMES TO NEW CONSUMPTION. AND CONSUMER BEHAVIORS IN CHINA. WE ARE SEEING MORE UPSIDE FOR THIS STOCKS. AND BEING INCLUDED IN THE INDEX MEANS THEY WILL BE MORE PASSIVE FLOWS FOR THE INDEX AS WELL. WHEN WE JUST LOOK AT THE CHANGES WHEN IT COMES TO THE RESHUFFLING WE ARE GETTING -- GOLDMAN SACHS EXPECTS THIS TO INCREASE BY 1.6%. THE ADDITION OF THE THREE COMPANIES INTO HSI IS ALSO GOING TO PROVIDE FURTHER TAILWIND. JUST TO KEEP IN MIND WE ARE IN THE PEAK OF EARNINGS SEASON SO THAT MIGHT MEAN THERE WILL BE MORE VOLATILITY UNTIL THE ACTUAL EFFECTIVE DATE IN SEPTEMBER. AVRIL: THAT REBALANCING REFLECTING NEWER CONSUMER HABITS IN CHINA AS WELL POTENTIALLY. THANK YOU SO MUCH. WINNIE HSU FOR US. MORE AHEAD ON "THE ASIA TRADE." THIS IS BLOOMBERG. ♪ SHERY: WE ARE FOLLOWING EMERGING MARKET ASSETS BECAUSE WE SAW THAT BOOST COMING FROM CHAIR POWELL'S MORE DOVISH COMMENTARY AROUND ITS UPCOMING RATE CUTS, POTENTIALLY AS SOON AS SEPTEMBER. WE HAD EMERGING MARKET STOCKS IN CURRENCIES ALL GAINING GROUND. OF COURSE THE DOLLAR WAS UNDER PRESSURE THE PREVIOUS SESSION. YOU'RE TALKING SOME LEVELS WE HAVE NOT SEEN IN WEEKS SINKING AFTER WE GOT COMMENTS FROM CHAIR POWELL TALKING ABOUT POTENTIAL MONETARY EASING TO CALM. YOU CAN SEE DESPITE THE FACT WE HAVE SEEN EMERGING-MARKET STOCKS RISING MORE THAN 10% IN APRIL, WHEN IT COMES TO FORECAST ABOUT WHERE THE STOCK MARKETS ARE GOING COME ANALYSTS PUTTING EMERGING MARKET STOCKS AT HEAD OF GAINS COMING FROM DEVELOPED PEERS. GAINS OF AROUND 15% IN THE NEXT 12 MONTHS. REASONS ARE PRETTY CLEAR IF YOU GET FED POLICY EASING OR INVESTMENTS PIVOTING AWAY FROM THE U.S. AND OF COURSE A LITTLE MORE CERTAINTY OVER TARIFFS AS WELL. AVRIL: YEAH. FOR EM'S, IF THE FED HAS OPENED THE DOOR TO THESE FED RATE CUTS, IT COULD ALSO PROVIDE COVER FOR THEIR CENTRAL BANKS. LOOSER MONETARY BACKDROP THAT WILL BE HELPFUL FOR E.M. ASSETS. EMFX IS JUST GETTING STARTED ON THE CLIMB AGAINST THE GREENBACK. ALSO WORTH NOTING WHAT WE ARE SEEING IN E.M. BONDS VERSUS DM PEERS. THEY HAVE BEEN OUTPERFORMING AND PERHAPS ALSO WHAT WE ARE SEEING AMONG THEM IS HOW THE MARKET HAS ENFORCED THIS SORT OF DISCIPLINE AMONG EM'S. THAT BODES WELL POTENTIALLY FOR E.M. BONDS OVERALL. BUT ASIDE FROM THAT LET'S TAKE A LOOK AT HOW CRYPTO CZAR FARING BECAUSE WE SAW IS SHARP SURGED FRIDAY FOLLOWING ON FROM CHAIR POWELL'S COMMENTARY AT JACKSON HOLE. WE ARE PULLING A BIT SOFTER. #112,000 ON BITCOIN AT THE MOMENT AGAINST THE BACKDROP OF VOLATILITY COMING DOWN ON CRYPTO OVERALL ALTHOUGH TRADERS SEEM TO BE TURNING TO ETHEREUM INSTEAD TO CHASE THESE PRICE SWINGS. THAT IS IT FOR "THE ASIA TRADE." OUR MARKET COVERAGE CONTINUES. THE CHINA SHOW IS NEXT. THIS IS BLOOMBERG. ♪

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