haidi: you're watching daybreak asia coming to you live.

annabelle: we are counting down to asia's major market opens. vonnie: asian stocks set to open lower amid the fallout from china's move to widen bands on iphone used. apples today slide wiping out $190 billion in value. chevron's talks with its australian lng workers continuing until friday as unions warn a deal to avert strikes is unlikely. schools and transports suspended in hong kong. trading may face disruption too, as the city is swamped by some of its heaviest rainfall in 140 years. haidi: we have some breaking news when it comes to hong kong and that weather situation. they were battered by a super typhoon last week and dealing with more extreme weather today. we are hearing from the hong kong exchange, delaying be friday morning session due to the highest rainstorm alert, canceling the preopening trade

due to that rainstorm other as well. we're seeing the prospect of another day of extreme disruptions caused by the intense rain, now from a different storm. schools will be suspended on friday. the government made that announcement earlier, that these weather conditions will last until at least noon. it also called on employers to give employee staff safety priority as well as flexible working arrangements. bus operators suspending service as well. the hong kong raising the highest rainstorm morning past 11:00 p.m. last night and staying in place through the course of this morning. this rain, which is now caused the cancellation or delay of the friday morning session, the preopening training on the hong kong exchange, really being caused by the remnants of the typhoon. we are also getting breaking data when it comes to south korea. narrowing to $3.57 billion. that july goods trade continuing

to widen to $4.28 billion as well. of course we clearly watch that number out of south korea given the extreme and sustained weakness we have seen in south korean exports. that key bellwether for broader demand strength from a number of developed and developing economies. vonnie: lori logan has been speaking as well. i want to mention the fed bank of dallas president saying skipping an interest rate hike at the september meeting may be appropriate, but also signaling rates may have to rise further to get inflation back to 2%. this is definitely a message being put out by many fed speakers. my base case, said logan, is there is work left to do. that is what we heard from john williams earlier today as well, from mike mckee's interview at bloomberg world headquarters. after a down session it looks like there may perhaps be some

relief in store but it is too early to say. unchanged on s&p and nasdaq futures. similarly unchanged on bonds. we saw yields come in edit today. crude oil has been rising and still sticking around $87 a barrel so we will see where that goes tomorrow. annabelle: just keeping an eye on what is happening in the asian outlook today because broadly when you take a look at futures we are pointing ahead to a weaker start for most of the region. otherwise some markets looking for some very modest gains. tech stocks will be the particular watch because it is still that day two reaction to china climbing down on the use of iphones among state employees not only within government state backed enterprises. that is a big focus. also keeping an eye on the impact of currency moves. we have the japanese yen still holding above 147. we heard from the suntory ceo

saying be could reach 170. still a lot of strategists and investors, business owners saying we could see further weakness to come. the offshore and the onshore yuan in focus. we're at the lowest level we have seen since 2007. clearly the pboc watching this very closely and we have seen that string of stronger-than-expected fixes coming through, 46 and around. haidi was just mentioning the moves we are seeing in hong kong with the delayed morning session due to the rainstorm alert. this is being very closely tracked, given the black rain that fell. if the warning is still in place my 9:00 a.m., the morning session will be canceled completely. hong kong is expecting extreme weather conditions to last until noon at least. haidi: one to watch out for. let's get more as we round out the end of the week. our executive editor from asia, paul dobson, this rally

continues to dominate just about everything. paul: yeah, it does. we're headed for that record winning streak for the dollar. beating all comers. the data continues to support the case for an exceptionalism trade for the u.s. that is where it is. the u.s. is outperforming and still looking strong on the gdp, at least in our current metrics. if you are looking further forwards, there are signs of fraying at the edges of the economy. right now things are still looking strong, the higher u.s. yields we are seeing drying capital from the rest of the world. if you look around the rest of the world, what else are you going to buy currency wise? the yen with very much lower interest rates, still not an appealing option. the chinese yuan likewise looking gloomy. in the euro area, the economy is

not looking strong. the ecb may start thinking about sitting on his hand. the u.k. had been hawkish in terms of central banks. we had these comments over the week that they may be closer to the end of the hiking cycle. so all a story of u.s. dollar strength, which has that impact of tightening financial conditions for the rest of the world. it is therefore negative for global markets outside of the u.s. vonnie: then of course we had interest rates rising a lot this quarter as well. .5% on the 10 year and 30 year. so what happens next quarter, and will that also exacerbate conditions outside the u.s.? paul: yeah. i mean, there's a lot of people who want to buy treasury at these levels. and we have seen a cap around where we are now over the last

year as money pours in from longer-term investors. but also, the supply equation is still very much tilted in favor of increased sales of u.s. government debt. so that is kind of weighing on it. this week we saw a massive glut of corporate issuance, adding to what the market needs to take down. if you go back to the root causes of how we got here, you think about u.s. fiscal policy, you think about the support we have, the extra borrowing being taken on to do that, that is helping inflation stay higher in the economy. that is causing the fed to keep us lose interest rates. therein lies the rub for the rest of the world. vonnie: paul dobson joining us there, thank you. funnel preparations are underway in new delhi as india gets ready to host this weekend's g20 summit. president biden is on his way, but china's xi jinping and russia's vladimir putin will not attend. let's get more from haslinda amen who joins us live from new delhi.

so what is on the agenda and what are the implications of president xi jinping's absence? haslinda: i mean, xi jinping's absence is disappointing but not surprising because the g20 crowd is tough for him given china is at odds with a lot of the member nations. at odds with the u.s. on a number of issues, at odds with japan over the nuclear waste water, at odds with india over that disputed border. so it is a tough crowd. it is not surprising he is not here. but that aside, big issues on the agenda this g20. we have climate change, we have surging debt, we have reaffirms -- reforms to do with the likes of the world bank. the issue really is coming to a consensus on all of those issues. climate change for instance, now we are hearing china wants to link talks to be with climate change with chips.

remember that the u.s. has put a lid to puta curb on its access to crucial chips. we are also hearing nations of the g20 taking issues with rich nations in the g20. they are asking help for funding for their transition to clean funding. rich nations have committed $100 billion and they have yet to see any money flowing to their countries. here we are on the eve of that summit come at risk of not having our leaders communicate, which would be a first in the history of the g20 spanning 15 years. haidi: how might the u.s. view this g20? you talked about the difficulties in finding consensus. how would the u.s. define success? haslinda: a lot is at stake for the u.s. coming into this g20. we heard from jake sullivan

saying the g20 is a value proposition. the u.s. is here with a proposal to get closer to countries of the developing world. the global south in particular wanting to perhaps expand the capital given to the likes of the world bank. remember the u.s. has taken issue with the loans china has dispersed to the developing world to help infrastructure, saying they come with strings attached. the developing world has come back to say if not china, who else? here we are at the stage where the u.s. is in a position to perhaps fill the gap, take over china's place in terms of helping the developing world. still we are waiting to hear the details of this value proposition. haidi: modi and biden are expected to meet tonight. how are bilateral relations? haslinda: bilateral relations

with the two countries have taken such a huge improvement, especially on the back of that trip that modi made to the white house. at that particular meeting relations went up two nothces. they eradicated differences when it came to about a dozen trade issues. but there are other issues that need to be worked out. india wants greater u.s. presence in the indian ocean. the u.s. has been pretty much focused on the south china sea, the east china sea as well, but not quite the indian ocean where india's strategic interests live pretty the u.s. wants india to give a greater commitment to pushing back russia. india it remains a buyer of cheap indian oil and it wants to stay neutral in the ukrainian war and that is why the issues -- that is where the issues lie between the two nations. haidi: haslinda amin joining us

live from new delhi. coming up, equity markets lag while bond markets are usually right. we will discuss what that means next. ♪ ♪ is it possible to fall in love with your home... ...before you even step inside? ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines. when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh

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>> right now i think things are moving in the right direction. we have policy in a good place. but we are going to need to be data-dependent, watch the developments, and assess what we need to do. haidi: new york fed president john williams speaking exclusively to bloomberg. our next guest says any notion of a fed what should be put behind in the new regime of interest rates. nick schoenmaker joins us now live in sydney. are markets getting it right at this point because there is so

much focus on every piece of fed speak. we know the fed will not be swayed by one piece of data alone. how do you view the pricing at this point in september? nick: i think the narrative is changing every few months in global markets at the moment. if you look at where yields have gone, they are steepening in the u.s. and over the next few weeks what we will see is rate cuts in 2024 being priced out in line of that higher for longer backdrop. in terms of investors pricing, geopolitical we have seen this happen with china and huawei in the semiconductor breakthrough. i think that is quite significant. we have seen xi jinping for turning down attendance for the first time ever at the g20. if you think about returns, if you look at the earnings, it is really nvidia and meta that had

rising projections for this year and next year. the rest of that cohort have been flat or negative in terms of tesla. there is some light cycle exuberance feel to the market, albeit did start to see that rounding out and some weakness in august. haidi: what does the triumphant return of king dollar tell you? we have march highs insight, the largest on record. fund on the mentally -- nick: going back to the fourth quarter of last year we will be in the first transition of u.s. dollar weakness. we have not had that. one interesting thing to look at is the correlation of the u.s. dollar with commodities and notably energy. the u.s. has been a net energy oil exporter since 2019 and the currency is highly correlated with their terms of trade. haidi: it is no longer the

inverse correlation. nick: that's right. aussie investors have tried -- that natural diversification. dynamics need to be revisited. but it seems like dollar strength will carry on for the shorter-term. the bank of japan is not hoping either. vonnie: what are you doing about china? nick: yeah. so, we had some exposure to china. we bought chinese equities tactically last year, and then we thought the reopening trade would be similar to what we saw in the western countries. in hindsight, the stimulus is not delivered to households to agree the g7 wealthy countries provided. so that pent-up demand was not there to some extent. and now, whether it is youth unemployment, the property market, with evergrande and so

on. there is also a lot of for investors going into asia. it's a market where we think there is too much risk right now. so we moved out of china over the last couple of weeks. haidi: did you find a march active area to put that money into, or are you just holding it on the sidelines at the moment? nick: we are overly cash still. we are kind of getting paid to. but we did redeployed that into global equities. but we are still underway global equities marginally, and about neutral in terms of strain shares. fixed income we have been building duration more and more as yields rise. that long in the beer stable could continue. we still think the likelihood a recession over the next nine months is probable so there could be that really nice once in a cycle capital gain for long

bonds and a really good carry caution promoting sovereign bonds now as well. vonnie: we -- haidi: we spoke a little about tech but this correlates with china as well. we are following what happened overnight with the apple ban. also huawei's new phone showing that have managed to achieve what they have been trying to stop them achieving. nick: this cold war has been somewhat pointless to a large extent. again, it is big geopolitical news. there will be a lot of countries now that will be leaning towards huawei for some of that access to those kinds of phones away from apple to some extent. as you mentioned, we have seen the chinese communist party talking about government advisors moving away from the apple iphone. that is about 20% of their sales.

in terms of countries being cautious the u.s. may weaponize semiconductors i think they lean into huawei to some extent. haidi: do you still stay invested in ai semis, even after the big run-up? nick: we do have some exposure there. we got a bit of a barbell in terms of energy. but again, they are very much priced to perfection. you just want to be cautious by having too much. it is certainly an innovation theme. the key thing this year is the economic rent from ai does not go to seven stocks, and that is a key takeaway in terms of how narrow and strong that market leadership has been with check this year. haidi: neck, great to chat with you as always. you can get a roundup of the stories you need to go at dayb and on the immobile in the bloomberg anywhere app. you can customize settings get

the news on the industries and assets you want. this is bloomberg. ♪

vonnie: former ftx executive ryan salem has pleaded guilty to criminal charges stemming to the collapse of the crypto currency exchange. su keenan has the details. he is the fourth ceo of sam bankman-fried's inner circle to plead guilty. su: he was hired in 2019, based out of the bahamas unit and he had bought a private jet and opened a restaurant and had a fancy car during his job there. he was the co-ceo of the ftx bahamas subsidiary and was in federal court dressed in a suit and bitcoin socks. he admitted in court to making

$24 million to support republican candidates. he said he knew it was prohibited by law to make contributions in his name that money that was not his own. he also added that the funds were categorized as loans and he never intended to pay them back. in terms of the plea, it was one count of account finance violation, another of operating in illegal money transmitting service. he agreed to surrender more than $1.5 billion in assets. there was a lot of focus on whether this latest member of the inner circle might agreed to testify against sam bankman-fried, it appears that is not part of the plea deal. there is no promise to do so. bankman-fried was arrested in the bahamas at the end of last year. and interestingly enough according to bloomberg reporting, it was ryan salame, when the issue first came to the for an the bahamas, who had main

known to bahamian officials that customer funds may have been commingled, kicking off the investigation and resulting in his arrest. of course sam bankman-fried, now moved back to the u.s. as he awaits trial. my colleague sonali basak spoke to both ryan salame and sam bankman-fried prior to their arrests. she said it was interesting to note the two were not always close together because you had ryan salame traveling between d.c. and the bahamas, and he was mainly contributing to republican campaigns, while sam bankman-fried was contributing to democratic campaigns. haidi: how does this complicate things for sam bankman-fried? su: it certainly appears to stack the deck against him. as noted, three prior members of sam bankman-fried's inner circle of already entered into plea deals, and they have agreed to

cooperate with prosecutors, meaning, they will likely testify against him. also, sam bankman-fried had his bail revoked several weeks ago when a judge found that there was significant evidence he had been tampering with one of the witnesses, namely carolyn ellison, one of the three other members of ftx's inner circle who not only pled guilty, but again, could not be presenting devastating evidence against him. sam bankman-fried is now awaiting his october trial in jail and lost a bid to get out of jail for a few hours a day to help prepare for the case. haidi: su keenan there. a quick check of some other corporate stories. disney has narrowed its federal lawsuit against the florida governor ron desantis and his political allies. the lawsuit not only focuses on the first amendment claimed the company was subject to retaliation for criticizing republican policies.

it claim -- took property without compensation, and violated due process. zoom met with regulators to outline concerns about allegedly anti-competitive behavior by microsoft. the company talked to the u.s. ftc and other competition forces in the eu, u.k., and germany over the past year. zoom expressed concerns microsoft gives preference to its own team videoconferencing software. plenty more to come here on daybreak asia. this is bloomberg. ♪ nice footwork. man, you're lucky, watching live sports never used to be this easy. now you can stream all your games like it's nothing. yes! [ cheers ] yeah! woho! running up and down that field looks tough. it's a pitch.

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>> japan cash earnings crossing the bloomberg. year on year the number coming in because than expected.

1.3 missing expectations for 2.4% for the month of july and really retreating from that two point 3% growth that we saw previously. really putting into question any likelihood that we see this kind of wage inflation driven turn from the boj's current monetary policy settings. a contraction of two point 5% year on year and real cash earnings is what we see, worst of expectations of 1.4% and extending up that contraction over at 1.6% that we sought the previous reading as well. it wasn't just a flat line expected, we saw the pay increase expected to lag rising living costs and that snaps the household purchasing power, but that impact is steeper than expected, stronger consumption act by brisk wage growth is what was really hope for that could elevate consumer prices. that clearly is a scenario that is quite far off for the bank of japan. that steeper than expected when it comes to labor of cash earnings adjusted for inflation really much, much more steep

than expected. bloomberg economics expectancy wage growth's slowing down in august but starting to see the start of that as we get that impact from a larger sum of bonuses helping workers cope with price increase and that starts to fade away. a bit of a shocker when it comes to wage numbers out of japan. vonnie: hey bit of a shocker for some goldman sachs employees underway as well. breaking news, according to the financial times, another round of job cuts at goldman sachs as early as october. we had anticipated potentially another round of job cuts. sources are telling the financial times that goldman is preparing to impose another round of job cuts for employees deemed bottom performers. it could come as early as . it typically results between 1% and 5% of companywide employees losing their job. goldman tells the sources to the financial times that it will be at the lower end of the range but it will come in the investment banking and trading

businesses. once again, yet another round of job cuts at goldman sachs. huawei's release of a mobile phone utilizing technology the u.s. has sought to keep out of beijing's hands has set alarm bells off this week in washington. while ways mate 60 pro is powered by a new seven nanometer chip fabricated in china by smic. the chip was revealed in a tear down of the tech insights conducting for bloomberg news. joining us now is the vice chair at tech insights. explain to us these tear downs. they are more like biology than carpentry. give us an overview of what you do and how long it takes. dan: what we typically do is, you start off in separate -- you split the phone apart, you get the motherboard out, you remove the chips, then from there you strip off all the plastic. and you are literally like putting it in acid or a plasma

that edges away the plastic. then you will start to remove layer by layer to get down to it. you will do a cross-section. in a way, it's like cross sectioning a cold sandwich, and then looking at all the layers and peeling it off layer by layer. it's a fairly long process, this case we really rushed through it, we had people working over the weekend and whatnot because it was so exciting to see what was going to be in the phone. vonnie: what is the significance of huawei using smic's seven nanometer technology chip in its phone? dan: the big significance is it shows that china has been able to get around, or at least get forward on some of the sanctions that were on them that limited their access to seven nanometers

equipment technology and beyond five nanometer and three nanometer. the result of it is, they've been able to get from the 14 nanometer to the next generation, which is seven nanometers, and it's a pretty clean device. we looked at the device and there was a really lot of -- on the engineers to bring this to market's. >> a previous guess who said he would take a look at this end does this tell us that the whole tech cold war has been pretty useless? would you go so far to say this is a breakthrough for china to the extent that the curves from washington have been ineffective? dan: not at all, the rest of the world is at three nanometers, going to do in the next year, so, you go from 14 to seven, to five, to three, to two.

so they are still back to nodes, and the original objective of this sanctions was to keep china's fabrication capability to nodes back, so they are still to nodes back, it's just that people had thought that based upon the equipment technology that was restricted there, that they would only be able to get -- they wouldn't be able to get pass 14 nanometer without a lot of yield loss. the toolset that they have is the same toolset that usmc and samsung use for seven nanometer. haidi: in terms of the pace of the progress, what we could deduct from that in terms of how much more further progress it can make to catch up, if you take a look at the progress since they found out last year with the mining machine, this seven nanometers 10 now, has the pace of progress surprise you,

and do you think you could extrapolate that to say what happens in the future. dan: i wouldn't say it was surprise. we pretty much predicted this would happen and it was a question of when we would see it. we knew that the bit mining device was really crude and very poorly done with access to more emerge and deep uv tools, they would be able to get further down into the dimensions, they could get much cleaner patterns. and as they simply did the grind of the engineering, that sort of thing, it really brought them up to speed and was able to pull this device off. so at least it can be done in volume or the pit mining coin was not a really manufacturable device. haidi: the other pic question is scale. do you think huawei will be able to make this to the scale that would be a viable competitor?

dan: from what we've seen in terms of the device itself as we look at the transit service, we looked at the interconnect, all the various wiring that goes into the device, it looks like they are well on their way. not only that, but they've been able to develop a lot of their own ip into the device itself, so, as opposed to using bulk column technology, that sort of thing. so, they really made it your medicine amount of progress, both on the manufacturing side, as well as the design side. vonnie: what other key components did you find in this phone, particularly the one that was surprising, and is it significant that most components were made in china? dan: it is significant that most components were made in china in the sense that it shows that china has moved another step

towards it's made in china 2025 program. when i looked at some of the stuff that i've seen so far, it looks like about two thirds of the chip, approximately, was chinese technology as opposed to the prior generation it was more like a quarter to may be third. so that has been a really significant improvement. i must caution, that's an educated guess on my part because they are going to go in and they will measure all the different parts of the chip and we will figure out exactly what the area is. i'm talking about the chip itself, the design on the chip, i'm not talking about the toolset in which the chip was made, the toolset, the semiconductor fabrication tools are still pretty much dominated by tools made in america, japan and the netherlands.

haidi: i will never look at a club sandwich the same way again. really appreciate getting those fascinating insights from you guys. talking about the deconstruction, the tear down of that revelation when it comes to the tax basis week. let's get you to annabelle to take a look at it's really moving this friday. annabelle: counting down to the open for cindy, solon tokyo. it will be the focus for a second day on the tech sector because we continue to see the fallout from the prospects of china banning the use of iphone amongst government and state backed company employees. so that really has big ramifications apples lighting 6.5% over the past couple of days and falling below its 100 moving day average. hitting other suppliers in the likes -- in terms of the likes of qualcomm. nvidia feeling the brunt. these are big apple link suppliers in a dutch asia. we saw that movement yesterday

that 75% of its revenue from apple. now the stocks we are watching for a second day. let's change on because the other big focus is more weather related in the session as we look ahead. we had headlines dropping at the top of the hour, the hong kong stock market delayed its morning session due to a rain storm alert. we have the heaviest rainfall since 1884 falling across the city over the past night. schools won't be opening, but stock market trading could be delayed. the warning is still raised by 9:00 a.m. in the entire morning session will be canceled. hong kong is expecting extreme weather conditions to last until noon. we are risking the whole day of trading being canceled. quick check of what we see in futures because we just had them come online to the nikkei contract and singapore. ahead of the day we are looking for a slightly weaker start, which will be filled around the rest of the region. watching what's happening with

the japanese yen. we have those real cash earnings coming out showing contraction again on the year. certainly telling us that there is a reason for the boj to keep those easy policy settings in place for a while longer yet. haidi: this ceo says the yen could weaken to 172 the dollar if the boj keeps those rates ultra low. and they say that higher rates may still be years away, he also told us exclusively how the company's beverage business is adapting to changing consumer tests. >> we are capable of investing to another potential area, such as ready to drink. if you look at the younger generation, there is a strong and potential need that they want to drink less alcohol beverage. so, our soft drink division and the. division works together to take on the challenge of the

space of ready to drink, and you don't see it, that was the first case. that first case should be hugely successful. so, we are positioned very uniquely against our competitors, so we believe our td market is hugely potential to attract more consumers. so we want to be number one in the world. >> you are expanding abroad, the yen is weakening further, japanese government is also closely watching the situation. how far do you think the yen may weekend, and how long do you think it may last, and do you think the yield curve controlled by the bank of japan needs to be amended further, and if so, to what extent? >> i think boj's management falls to change entire monetary policy to order the economy with

positive interest rate as soon as possible, but i think they need to understand the possible turmoil in the japanese economy, such as small enterprises, medium-size enterprises, they will get the heart. so the government has to make a decision that the government will help people, but not corporations. i would assume that the japanese yen might hit around 170. not 150. so, how we can resolve trade-offs. but the key thing is, definitely , the economy should be driven by the private sector from the

government, always in economy has been relying on the state finals from the central government. we have to move so order the economy supported by the private district, there is state finance. haidi: the ceos speaking exclusively to bloomberg's matt winkler. we have more to come on "daybreak asia". this is bloomberg. ♪

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vonnie: checking on u.s. futures. we might get a tiny bit of relief tomorrow after so many september sessions of declines for the s&p 500 and the nasdaq. mind you, today the nasdaq was on the decline mostly because apple was on the decline thanks to crackdowns in china on particular iphones and particular places, and the threat that that might spread, broad, lost more than 7%. tomorrow we may see a friday that gives us a little bit of relief after, as i say, almost every session in september being a down session. haidi, other things to watch, probably keep a close eye on oil

as you hold on to the levels all week we've seen crude oil in the united states just under $87 a barrel and brent just around $90 a barrel and they are still there. haidi: the energy transition climate change, the key items for the g20 agenda, spotlight is on the host effort to reduce carbon emissions. india is aiming to reach net zero by the end of the century as it tries to meet the energy demands of a rapidly growing economy. we take a closer look at these challenges. >> from electrifying public transport to solar rooftops, a small urban solar parks like this one, to the world's largest solar farm, biogas hydrogen. his energy problem. the problem of both demand and supply.

india consumes less than a third of the energy america does on average, but there are one point 4 billion indians making it the world's third-largest energy consumer. rising incomes and urbanization also means rapidly rising energy demand supplied mostly by hydrocarbons. coal powered 70% of india's electricity. the country has the second-largest reserve in the world. trillium products power transport. over 80% of the crude oil is imported, posing a budget risk. which is why india is aggressively pushing public and private investments across green energy. using a mix of local production incentives, and import tariff barriers. the progress has been encouraging. by 2030, almost half of india's power generation capacity will be solar, wind and hydro.

electric sales should pose last, though they are a fraction of overall sales and green hydrogen has drawn multibillion-dollar bets from leading conglomerates. but there is still batteries, storage, group transformation, so much to do. last year india spent $16 billion on green energy technologies. it needs at least 10 times that investment every year since 2030 to get on track with net zero. india needs to get this energy transition right. it would not be an exaggeration to say their future of the planet depends on it. vonnie: we are anticipating gdp data out of japan, second quarter gdp data disappointing coming in at 4.8%. in the market was anticipating that to be 5.6 percent, that's annualized quarter over quarter. 1.2 percent, second

quarterfinal. that was anticipated to be 1.4%. again, a disappointment, nominal gdp coming in as anticipated. private consumption was lower than forecast, minus point 46%. business spending was worse than forecast at -1%. the inventory really came in as anticipated. again, a disappointment in terms of the second quarterfinal data for japan's gdp. net exports adding 1.8 percentage points to quarter over quarter gdp as anticipated. i do want to point out that the current account is now in surplus by 2700 ¥71 billion, that is just more than anticipated. the current account surplus is a little bit healthier. just let's get a look at the yen. not that much change. 14736. arm holdings has used its investor to predict revenue growth of 11% in the current

year. and a jump in the mid-20% range in fiscal 2025. sources say the softbank back chip designers telling potential investors growth will be boosted by demand for chips to power data centers and artificial intelligence. they look to raise 4.8 7 billion dollars in what's poised to be the largest ipo of the year. haidi: landing a role in arms giant offering has been a -- this is one of the four global investment banks leading the deal. the japanese firm now needs to prove that it's more than just a one-time thing. let's bring in our investor editor. russell, if we take a step back, how did they manage to learn such a big role on this high profile deal? >> good morning, there are two main reasons for why they landed this deal, first and foremost is the banks long-standing ties with softbank, which stretch out more than four decades to their

predecessor making a loan to softbank when it was just a fledgling start up. it's the biggest lender by far to softbank. those ties have become moser over the years. we know there have been personal relationships between softbank's son in the top executives, and now they have a dedicated team in tokyo of bankers, about a dozen bankers that exclusively serve the softbank group. but secondly, the more surprising raising -- reason perhaps is that they have been expanding their presence in the u.s.. just four years ago it hired -- to run investment banking and the u.s., she has been building the team, she worked very closely on the steel and -- on this deal. the expansion has been taking shape and they have been working -- the bankers in the u.s. have been working closely with the team and in japan as well. it has been a team effort that landed them this deal.

haidi: russell with the latest on the deal of our asia investor editing -- investing editor. talks are said to continue on friday. workers are poised for two weeks of rolling strikes begetting next week if a deal zohreen shah. bloomberg's david stringer joins us now. it sounds like there are managing expectations for worst-case scenario. are we close to strikes going ahead? ava: good morning. as you say, talks have been ongoing between chevron, the big oil and gas producer, and various unions involved in this industrial action. those talks will resume this morning, and what union officials up and telling us overnight is they remain pretty underwhelmed by the companies offer in this dispute around conditions, and it does look likely that some industrial action could go ahead. that could begin around 1:00 p.m. perth time, and it will

begin incrementally and potentially ratchet up. we could potentially see stoppages, refusals to carry out certain tasks. begin from today, and if nothing progresses, if we don't see breakthrough from september 14, that would escalate to 24 hour walkouts. vonnie: does that mean we would be likely to see any impact on lng supply initially? if it's just like things gloating certain cargoes, correct me if i'm wrong, but i'm leave the offshore employees would continue working for the first few days? david: some of those details we will see as things begin, and if we see those strikes go ahead from this afternoon in australia. in terms of the impact, you are right. at the beginning the first potentially days, weeks, we won't see any major impacts or disruptions to shipments, exports, to the flow of lng, to

big customers like japan and china. the issue is, what happens down the line. those disruptions will cause potential shortages, that's going to come to by some of those important countries stored the winter. vonnie: we have a few more hours. david stringer there, thank you so much. speaking to us from melbourne. market opens in sydney, seoul and tokyo are next. this is bloomberg. ♪ i was told my small business wouldn't qualify for an erc tax refund. you should get a second opinion from innovation refunds at no upfront cost. sometimes you need a second opinion. all these walls gotta go! ah ah ah! i'd love a second opinion. take the first step to see if your small business qualifies.

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vonnie: this is "daybreak asia", counting down to asia's major market opens. we will have to see where

happens with tech stocks in this session because we saw an absolute play rain for many tech stocks in the u.s. session with the exception of intel, which has been hedging for the tech people. haidi: we are watching hong kong as well. we had this latest extreme weather situation a week after it was lashed by a typhoon. we are getting -- when it comes to the stock market. the morning trading session will go ahead. schools seven the most rain we've seen since 1884. annabelle: crazy to wrap your head around here. we do have the open ahead for japan, south korea and australia the start of trading for cash treasury. it's not just where we feel the extreme weather in hong kong. in japan they are bracing for a tropical storm set to bring heavy rain to white areas in the country expected to make typhoon number 13. expected to make landfall in the eastern part of the country on friday afternoon.

we already understand each japan railway has some limited express trains into the area around tokyo, those will be canceled. other sections may be delayed, suspended or changed in destination. that's another weather watch as trading gets underway. but it's an ego watching the session today because we just had second-quarter gdp figures dropping for japan, and we saw on an annualized basis, growth of 4.8% and that was well short of estimates for 5.6 percent. likewise, we had the labor data earlier, we'll wages falling for 16 straight months in july. nominal pay growth as well as slowing. that tells us that the boj is likely to keep its easy policy settings in place at some time to come. we have seen the japanese yen looking above that 147 level. some saying we could be at 150 by the end of the year. let's change on because we have the open of korea, here and eco-focus.

the top of the last hour we had the current account data coming out for july. we saw that surplus narrowing to $3.58 billion. south korean won has been a big focus for us. it's holding fairly steady. we did see a weaker end of the prior session with global funds being net sellers of equities on the session on wednesday. on thursdays as well. it's really the deteriorating risk sentiment we are continuing to watch that plays out in the session. you've got the kospi in the red. because daca's flat. tech stocks, really the one sector for us watching, given we saw that apple side for a second straight day. $190 billion of its market cap now wiped out. it's supply is very much in focus. a lot of those in seoul. in australia, the focus will be on labor union talks so we have discussions between chevron and labor unions in australia set to drag into friday. this is something that natural

gas markets and traders will be watching closely. the union say a deal to avert strikes is unlikely, so we are watching the aisle, that closely. oil just coming online. we are a little weaker in the session. we are headed for a weekly gain after opec-plus leaders, saudi arabia and russia elected to extend their supply cuts. but still, there are those technicals at lay. they are suggesting we are at levels where we are due for a pullback. vonnie: we have one more session this week. let's bring in our next guest use hoping for more from chinese equities. with us now is the managing director at ocbc bank. we did see chinese equities rise to a certain extent after we saw some measures, really just last week, but those gains are gone again already. what's your base case and best case scenario in terms of what we might get? >> we were more optimistic on chinese equities at the start of the year.

we thought the reopening would give the economy a boost in equity markets a boost, but we have since it taking -- taken it down from chinese equities, the neutral chinese equities. we are not negative, we are neutral. we are waiting to see what it does in terms of helping the economy. thus far the measures taken by the government has been piecemeal. we are hoping for more because if you look at history, in 2008, the global financial crisis, china unveiled a massive stimulus package of close to 4 trillion yuan, 10% of gdp. in 2014, 2015, announced another huge stimulus of 3 trillion yuan. this time around, the stimulus measures have not been anywhere near us we are hoping that essentially the government would do more. but they have done so far is good, but not enough to move the dow and boost investment in consumer confidence in china.

you are hoping that in the coming months the government will do more and it will help. vonnie: do you mean another stimulus package of trillions of yen, because it seems like the government doesn't want to do that this time around, so what else could it do that self-sustaining? >> you're right, the government doesn't appear to be too keen about launching another big stimulus, but i think they need to do more in terms of helping the property market. they have done a bit already. they have brought down mortgage rates. they provided support to property developers. putting money into the hands of consumers so that they will have more confidence in terms of buying homes and perhaps even helping with the developers with the financing issues. it remains to be seen. they have the means, the reserves to do it, but the political will appears to be lacking at this juncture. i think they are hoping that the

economy will find stem stability. if that happens, they will may not have to do as much as they did historically. more fiscal spending in terms of helping the property market in helping the economy. the measures have been very targeted in the economy clearly needs a shot in the arm. haidi: when you talk about the spending, do you mean direct to household payments? is that the thing that will help continue to boost more resilience in the consumer? >> perhaps. perhaps doing what japan and the western economies have done, basically putting more money in the hands of consumers to boost consumer spending, to boost consumer confidence, and helping the developers. i'm not sure if the chinese government is up to really providing a big backstop for developers but at least putting more money into the hands of

consumers, the small and medium enterprises. bringing down the unemployment rate. i think those things would clearly help boost confidence in china. at this juncture, the selective consumer confidence in china. consumers are out there spending money in a big way, but you could see caution among consumers in a puts more money in the hands of consumers that might help. haidi: we just had the wage data out of japan and a has a long way to go when it comes to getting wage driven inflation up to where it wants to be. does that kind of driver any shift in how you feel about japanese equities, which have been one of the biggest alternatives to china flows this year? >> we are positive on japanese equities. the latest economic growth numbers have come with middle expectations. the wage growth hasn't been that strong but we think there's a

case for japanese equities, the yen helps the equity markets, makes it cheaper. at the same time, you also see big corporate governing reforms taking place in japan. it's going to alter the attractive fares of japanese equities. in gdp growth numbers are still significantly above or people are getting out of the market. quiet lately with the latest data, it will remain loose and there's another tailwind fall for japanese equities in japan is under own to some extent among global investors. on a relative basis it looks more attractive and you can see money rotating out of some of the other developed markets that have outperformed towards japan, which probably offers more upside potential in the medium-term. haidi: when you make of the

rally in the dollar. is this a it of safe haven flows we are seeing, is it down to the growth and yield differentials? >> i think it's a number of factors. i think it was clearly there, china is in a limp in the case of europe. the economy doesn't appear to be in good shape. relative basis u.s. economy looks like it's in a better shape, so that makes it is safer haven. the other factor that has really given a lot of support to the u.s. dollar is the bond yields in the u.s. going up and holding up higher for a very long time, more than 4%. that's probably because the record issuance of treasuries in the third-quarter of this year, plus a huge amount of new issuance from the investment grade corporate sector in the u.s. that has kept yields higher, and i think the fact that it will

take a higher for a longer approach, another positive for the u.s. dollar. in the next three to six months, those factors are clearly going well for the u.s. dollar, and you could see more upside for the u.s. dollar. for the next 12, 18 months, there's a good chance the fed could cut rates in the second half of next year, and debt could pull the dollar down. short-term, positive of the dollar, medium-term, we still think the dollar could hit south. haidi: always great to talk with you. managing director of -- managing director of ocbc bank. annabelle: getting trading underway, fairly mixed reaction we see so far, mainly tilted to the downside. one particular name standing out, lg innotech because it takes 75% of its revenue from apple and it slumped yesterday in the session, really building into those session losses of around 10% the last couple of days. in terms of the market reaction,

the question is whether this is being a little too over pronounced. the pullback we see in apple suppliers and apple itself after china seems to have banned government employees state backed enterprise, employees as well from using the iphone. bloomberg intelligence said the impact of that band will be negligible. in cities as the market could have overreacted to the news flow even though there is weak confidence. that's us at play for suppliers as straining comes underway. we are also taking a look at boeing suppliers in the session today and we do understand that boeing has warned that delivery 7737 will be out the low end for the 2023 target. around 400 to 450 of the jets will be delivered over the course of this year. they disclosed last month that some holes in both kids, which are essential for maintaining cabin pressure or improperly

drilled by its holdings, so that is really what is behind the delay. the cfo of boeing saying that the bulkhead issues are taking a lot longer than expected to inspect and to repair, even though he says they have armies working on the problem that still something that apple suppliers see a little bit of mixed reaction. haidi: india hosting g20 summit. we will be live to assess the impact of xi jinping's. this is bloomberg. ♪

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haidi: final preparations are underway in new delhi as india gets ready to host this weekend's g20 summit. president biden is on his way but china's xi jinping and russia's vladimir putin will not be attending. let's get more from haslinda almond joins us live from new delhi. what's on the agenda, some pretty big absences there. haslinda: that's right, in fact, india, the u.s., european member nations have said that it is a disappointment that xi jinping is not here. there were hoping to have bilateral talks with him to perhaps work out some of the issues between their nations. but here we are, xi jinping, a no-show. but it is a tough crowd. it is at odds with the u.s. over a range of issues, including trade, technology, and taiwanese at odds with japan over the

nuclear waste water and at odds with india over the disputed border. so it would have been a very difficult g20 for xi xiping, especially the bank of a nation that is struggling to find its feet in terms of its economy. in terms of the agenda, huge issues on the table. we have climate change, surging debt, we have the restructuring of the multilevel banks, including the world bank's. the consensus is the issue. there is a risk that we may not see a leaders communique at the end of the meeting. and if that were to happen, it would be the first time in the g20's history spanning 15 years. lots of bickering going on right in terms of climate. we have imaginations wanting more help in terms of funding from the rich nations. remember that the rich nations have committed, promised $100 billion to help the transition to clean energy we have yet to see that.

lots of issues, lots of disagreements, a communique at risk. vonnie: how might the u.s. viewed this particular g20? how would it find success? haslinda: i think joe biden it may see this as an opportunity to win the hearts and minds of emerging economies. remember that coming into this g20 summit, we had the u.s. up in arms about the money, the loans disbursed by china for emerging economies to help with the infrastructure development. the u.s. says that these loans come with strings attached. this is an opportunity for the u.s. to fill in the gap, be an alternative to china, be an alternative to chinese funding along with the european partners . we heard jake sullivan, the u.s. national security advisor talking about a value proposition at the g20.

some took it to mean the u.s. would be here to talk about an expanded capital that would be given to the world bank to help not just the lower income economies, but also the middle income economies within the g 20's with their development. we are also hearing that the european countries are having a mini summit with the african nation to talk about the same thing, how they can play a role in developing infrastructure in the african continent. it is an opportunity both for the u.s. on the western world to show the commitment to the rest of the g20 members. vonnie: our bloomberg markets coanchor haslinda almond joining us live. stay tuned for more coverage from the g20 over the next few hours. former u.s. ambassador to beijing says china in the u.s. need to reach some sort of accommodation to keep the relationship between the two superpowers stable. max also told us how china's economic struggles are undermining xi jinping's role as a global statesman.

have a listen. >> the bigger danger frankly is that there will be various blocks that develop. president biden, western countries one. china with some of the south countries. president modi himself. don't forget, saudi arabia's there, mitty's countries. the big danger is that there is not going to be much of an agreement because each of the power blocks is going to be looking more to increase its position in the world. haidi: this comes at a time when xi jinping is facing a multitude of challenges at home. how much does that play into it? at the same time, how much is it more significant for him to push forward with this mobile statesman persona that he has certainly adopted at the start of his latest term. >> i think the economy is undermining quite a bit of that. it was to be received as a world

statesman. for example, trying to broker peace with the war in ukraine. that's transparently not very likely. in iran they are china book a deal there with iran. but also transparent. but at least he is trying to show to the south countries, not so much to the western, but the south country, he's a leader, he's a power. president xi jinping wants to be the leader of the south countries. there's no question about it, but he's damaged recently because of the economic problems . probably due to covid. they do it to restrictions and sanctions at the united states on high-tech companies in china. haidi: ambassador, we heard from justin trudeau speaking to us in singapore. beijing is not on the cards, but there is a sense of stabilization. i suppose it lends itself to a grown-up rival he of guardrails.

do you see further positive developments with that u.s.-china relationship? quakes we certainly hope so. i live we try to do our best with what we have. but once a realist about this. the best we can do is prime minister can maintain the status quote. the hope is that neither china nor the united states does anything stupid that undermines the relationship even further. something stupid would be public comments by one country or the other, or them criticizing the other, or major actions that are adverse to the other countries position. i just think we have to stabilize, and the main thing is, it will take a little while that the united states and china are going to have to reach some kind of accommodation. that is, when each realizes that china won't go away.

china is always good to be on the planet. it's kinda like an arranged marriage. it's not a marriage based on love, we don't love each other. it's an arranged marriage and we have to learn to accommodate each other. haidi: former u.s. ambassador to china speaking to us earlier. you can get around up of the stories you need to know to get your day going in today's edition of daybreak. bloomberg subscribers can get that on debris -- dayb . it's on the bloomberg anywhere app. you can customize those settings so you get the news on the industries and assets that matter to you. this is bloomberg. ♪ i need it cool at night. you trying to ice me oute bed? baby, only on game nights. you know you are retired right? am i? ya! the queen sleep number c2 smart bed is now only $999. plus free home delivery when you add an adjustable base. shop now only at sleep number.

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endless hardie® siding colors. textures and styles. it's possible. with james hardie™. vonnie: former fts executive pleaded guilty stemming to the collapse of the cryptocurrency exchange. bloomberg su keenan has the details is the fourth member of the sam bankman-fried ceo inner

circle pleads guilty, does this make the case worse for sam bankman-fried? su: one would think, this is clearly a victory for the prosecution to get this many high-ranking individuals to plead guilty just one month ahead of the trial. former ftx exec ryan salem joined ftx in 2019 and was a prolific little cool donor. bought a private jet, a porsche, opened restaurants while on the job. he was the co-ceo of ftx bahamas subsidiary. he report -- he reported to court with bitcoin socks. also admitted in court to making roughly 24 million in donations in support of republican campaign, saying he knew it was prohibited by campaign finance laws and the money came from alameda's account, not his own. as part of the plea deal he pled guilty to two counts, one count of finance violations in another counts of money violation. he agreed to surrender more than

a billion and a half and assets. the plea deal, this is what many were speculating, would he or would he not testify against sam bankman-fried. the deal does not include a promise to testify. sam bankman-fried was arrested in the bahamas in december of last year. what is fascinating as a result of bloomberg reporting is that it was ryan salem when the initial issue first came to the floor in the bahamas, who are initially contacting bahamian officials and specifically reported that customer funds may have been combing gold. that led to the u.s. filing its charges and expediting sam bankman-fried to the u.s. again, he is set to stand trial just weeks from now in october. haidi: bloomberg su keenan with the latest. breaking news when it comes to huawei and of course the technology used in this new phone. bloomberg had obtained that tear down. we spoke to dan hutchinson who

actually conducted the teardown a little bit earlier. we get the reaction from the commerce department saying they are investigating the made in china huawei trip. they are working to know the composition of the chip there is saying export controls are just one tool in the u.s. government's toolbox to address the national security threats presented by china. the restrictions i have been in place since 2019 have knocked huawei down, forced her to reinvent itself at a substantial cost to the prc government and that the commerce department in the u.s. are continuing working to assess and update their controls because lots of questions have been asked is to whether this means u.s. sanctions and controls and efforts are really going to curtail the development of these two processors and technology in china. we are hearing that from the u.s. commerce department separately. we also did hear that u.s. lawmakers really say that they think the smic warrants

investigation for appearing to have violated u.s. sanctions by supplying components to huawei technologies according to a number of representatives speaking in the u.s. earlier this week in terms of the impact on intellectual property. we continue to watch the story very closely as we did have that bloomberg commission teardown of that huawei phone. 20 more to come on "daybreak asia". this is bloomberg. ♪ hi, i'm jason and i've lost 202 pounds on golo. so the first time i ever seen a golo advertisement, i said, "yeah, whatever. there's no way this works like this." and threw it to the side. a couple weeks later, i seen it again after getting not so pleasant news from my physician. i was 424 pounds, and my doctor was recommending weight loss surgery. to avoid the surgery, i had to make a change. so i decided to go with golo and it's changed my life.

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[stambaugh] annabelle: more developments

throughout the morning. let's change on, half an hour into the session for japan, korea and australia, so far we are looking mostly tilted to the downside across the session. the index is a little bit weaker, but we are seeing more of the losses coming through in the i.t. space. the index down around half a percent at this stage. this really is the stage off the story that china is banning iphone use amongst government employees. also those that state backed companies. that is playing out for the apple suppliers in asia. let's take a look at some of them.

lg innotech is standing out. it's building into losses that are nearing 10% of the course of the not -- last couple of days. we are certainly watching those throughout the session. geopolitical session -- tensions. haidi: especially getting into the g20. we spoke with justin trudeau, saying that relations with china have improved, but there is still no political space or reconciliation, there is an exclusive conversation and singapore, trudeau told us it has been a few challenge -- a few challenging years for that relation. justin: china has made decisions over the past year that have made it more difficult not just for canada, but for other countries to engage in ways, i will admit, in 2015, the conversations we had was about working towards a free-trade deal with china, working towards those sorts of things, but in real terms, the choices and the

actions of china have made that more difficult. >> those comments coming as global leaders had to new delhi for the g20 summit. let's bring in the professor and director of the institute of global finance at the university of new south wales, he institutes the research into systemic risk in global financial stability, teaming up with the likes of the imf, the world bank and the asian development bank, was great to have you with us. going into this, to key absentees, xi jinping and vladimir putin, how does that impact the ability already strained by the g20 on the host nation to be able to come to any meaningful consensus or even get that communique. >> naturally, it is a bit disappointing, if you like, not to see these two leaders. at the same time, those could be a more symbolic, in a sense. but at the same time, what is more important here is whether

the g20 leaders are able to come up with a joint communique at the end of this summit, and agree on some of the principles, such as, basically, rule of law, respect for national sovereignty. food security, energy security, climate change, and obviously, more voice for developing countries in local affairs. so, if they could achieve, if you like, some of the issues, and there is a joint communique, that is a good sign. however, if g20 summit is going to turn into groups or blocks as a consequence, if you like, absence of two leaders and other issues happening around g20, that would be quite disappointing. >> given the lack of ability to reach any kind of consensus on ukraine, which is arguably the biggest issue for the g20, does that make you question the

relevance or the effectiveness of the grouping? >> not necessarily. i think that's the very issue, and i agree. i think when it comes to the issue of global peace and security, the argument is we shouldn't raise that at the g20 summit, but the literature is telling us that all global challenges and opportunities are interconnected. in other words, if you don't have a sound of global peace and security, we are not going to tackle climate change effectively. we are not going to have resilient global economy. we are not going to have much more effective multilateral trade system. so we can isolate one factor or one challenge from the agenda of a multilateral form, which is now g20. vonnie: the other leaders pose their own problems as well, professor. i'm wondering what president biden will do, who he will want to be seen with or not seen

with. what can he achieve out of this g20? >> i think they are obviously the issue of global leadership as each member country forming g20 inc., and in this case, the u.s. has to assure its leadership in this context, there are opportunities at g20 to ensure that there will be more collective actions in the communique will demonstrate that, that's the rule that joe biden -- role joe biden can play. the relationship is very important for the u.s. at the present time, and we have to really wait and see what emerges from potential bilateral, if you like between the u.s., and on the side of the g20. at the same time their issues such as climate change, food security, energy security, where the u.s. can play an important role.

haidi: important given that a number of these developing countries, obviously the host nation having to balance their climate commitments against energy demands of a wrap acceleration. you see that as being a pressure point? >> to some extent, to some extent, but the issue here is, if there is a genuine multilateral approach to climate change, if you like, then every member country would play its role to its best, then developing countries would be well received, if you like, in terms of financial resources, support the need to combat climate change, and also transition to cleaner sources of energy at a short amount of time than what they are currently experiencing. haidi: that's understandable that xi jinping is prioritizing his domestic challenges, of which there are many above these international gatherings. does it weaken the position of

china, given that he had wanted to position himself as a global statesman? does he give more of an opportunity for the u.s. to solidify these alliances in the region? >> yes, i can see that, and definitely, this is one scenario. absolutely. at the same time, we have to make sure that this, if you like, withdrawal, if it seen that we are walking away from the power and process of multilateralism, it doesn't lead to more tension, and what we call multi-polarity, when superpowers will start creating their own blocks around the position, as we've seen, for instance, extension of bricks. in more bilateral relationship between the u.s. and other countries. so there are some of the issues that we have to look at the long-term costs of not going through the process of multilateralism, and working together for global issues,

which are frankly, borderless, and is affecting everyone. >> boosting china's domestic position as well, right, because we have seen with the debt situation, the slowing down of the domestic economy, that perhaps that debt diplomacy cloud has been reduced. does this absence we can china lead institutions as well? >> i don't know, to be honest with you, we can just categorically say yes, it's going to affect, if you like, all these relationships in the strength, but definitely, if you are not part of a multilateral process, which is so important, if you like, it does question whether we can undertake some major policy reform and changes at a global level. there is no question about it. haidi: always great to have you with us. professor and director of the institute of global finance at the university of new south wales. vonnie: with climate change

among the key items on the g20 agenda, the spotlight is on the host efforts to reduce carbon emissions. india is aiming to reach net zero by the mid of the century even as it tries to meet the energy demands of its rapidly growing economy. bloomberg's correspondent takes a closer look at the challenges. >> from electrifying public transport to rooftops, to smaller urban solar parks like this one, to the world's largest solar farms, biogas, hydrogen, it is doing everything for its energy program. the problem of both command and supply, india consumes less than a third of the energy america does on average, there are 1.4 billion indians, making it the world's third-largest indian consumer.

industrialization and urbanization also mean rapidly rising energy demand. supplied mostly by hydrocarbons. coal powers 70% of india's electricity. it has the second-largest reserve in the world. petroleum products power transport. over 80% of the crude oil is imported, posing a budget risk. which is why india is aggressively pushing public and private investments across green energy, using a mix of local production incentives and import tariff barriers. the progress has been encouraging. by 2030, almost half of india's power generation capacity would be solar, wind and hydro. the electric vehicle sales should -- though they are a fraction of overall sales and green hydrogen has drawn multibillion-dollar bets from leading conglomerates. but there is still battery,

storage, grip transformation, so much to do. last year, india spent $16 billion on green energy technologies. it means at least -- needs at least 10 times that investment every year since 2030 to get on track with net zero. india needs to get this energy transition right. it would not be an exaggeration to say, the future of the planet depends on it. vonnie: i do want to point out that the yen has dropped below 147, it's 4681 right now, this is some lines from japan's finance minister basically saying that it won't rule out any options to address excessive moves, and will watch fx moves with a high sense of urgency. these are very similar comments to wet his deputies said the other day in the ministry won't rule out any options if fx moves continue. right now, it's having a modest

impact on the yen, down 14687, so we have the u.s. dollar weaker by 3/10 of a percent. the end strengthening by 3/10 of a percent. i imagine the ministers would prefer if the jawboning had a bigger impact on the end. nikkei 225 down 1.2% as well. the kospi down a third of a percent. and the asx 200 down a percent. plenty more to come on "daybreak asia". this is bloomberg. ♪ ♪ is it possible to fall in love with your home... ...before you even step inside? ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines.

vonnie: always release of a mobile phone utilizing technology, the ussr to keep out of beijing sands has set off alarm bells this week in washington. huawei is powered by a new seven nanometer chip that was fabricated in china by smic. let's bring in our tech editor. we are hearing from the commerce department that it's actually going to take action on this. bring us up-to-date on what could happen, how this could escalate. >> the major things that we know , because we went and we figured out the chips on the inside, they are the manufacturer of the processor, but than the latest findings from tech insights also

show that the majority of the other components for this device also made in china by unheralded companies. not major traded international chipmakers, these are small players within china's own ecosystem, and it speaks to the fact that china is doing what it has said that it wants to do, which is build self-sufficiency in the semiconductor. . haidi: we spoke to dan hutchinson a little bit earlier, he was angling about the developments, he wasn't terribly surprised, and he doesn't think that that development gap in terms of where they can go from here is going to be close that easily. what does that kinda tell you about the progress that china has been able to make, despite the sanctions? quakes it's really a key issue we need to stress, china has

made a major leap. not even catch up, to come a little bit closer, the gap between international global chipmaking, where you have the vast international supply chain. german, taiwanese, korean companies and just domestically whether within china or any other country is massive. china has made a big leap there you can say the u.s. could never make a device as fully featured just made in usa technology. but still, there is years, generations of technology between where china is today and where the global supply chain is, and they are saying, where china has achieved in terms of seven nanometers technology might just be hitting the ceiling of what is achievable without international supply. click such a fascinating story, certainly one that has been top of mind, all week and continuing to yield interesting results.

our tech editor there, when we are watching in terms of the market implications, while weather in hong kong, the biggest amount of rain since 1884 in the city, causing the delay, and the shutdown when it comes to schools as well at the start of stock trading this morning, according to the ha x. we are now hearing from the shanghai exchange citing the hong kong rain storm warning for the suspension of the stock connect southbound, at least this part of that market being affected. southbound trading is being suspended, according to the shanghai stock exchange, really reflecting on the hong kong stock exchange suspension due to these rain storm warnings. so the clearing the settlement of the hong kong stock connect transaction is being carried out will be underway according to the arrangement of the china security deposit three and clearing corporation. we will continue to monitor those weather events that you see, those extraordinary pictures there from hong kong.

we are also watching dollar strength, and we heard from the ceo of the japanese corporate giant saying that the yen could weaken to 170 to the dollar if the boj keeps rates extra low. he also says that higher rates could still be years away. he also told us exclusively how the company's beverage business is adapting to changing consumer tastes. >> we are capable of investing to another potential area, such as ready to drink, to look atfgrrrrrrrrrrrrrrrrrrrrrrrrr rrrrr the younger generation, there is a strong and potential need that they want to drink beverage. so our soft drink division, they work together to take on the challenge of this space of ready to drink. it and you don't see any. that was the first case.

that first case should be hugely successful. so we are position very uniquely against our competitors, so we believe our market is a huge potential to attract more consumers. so we want to be number one in the world. >> while you are expanding abroad, the yen is weakening further, japanese government is also closely watching the situation. how far do you think the yen may weekend and how long do you think it may last, and do you think the yield curve control by the bank of japan needs to be amended further, and if so, to what extent? >> i think boj's management falls to change entire monetary policy to have the economy with a positive interest rate as soon as possible.

so i think they need to understand the possible turmoil in the japanese economy, such as , some small enterprises, medium-size enterprises, they will get the heart, so the government has to make a decision that the government will help people, but not corporations. i would assume that the japanese yen that might be around 170, not 150, worse. so, how we can resolve trade-offs with them. but the key thing is, definitely, the economy should be driven by the private sector from the government. always the economy has been relying on the estate finals

from the central government. we have to move to order the economy is supported by the private sector instead of the state finals.

haidi: some of the heaviest rain falling nearly 140 years has hit hong kong, delaying stock market trading, closing schools and transport links.

because a week after the city was shut down by a super typhoon. let's bring in bloomberg's richard. what is a light at the moment, and what are we contending with here? richard: it's extremely wet looking outside, the rain hasn't really abated. the most extreme was between 11:00 and midnight last night. and that one hour time frame as when hong kong had the heaviest rainfall since it began keeping record almost 200 millimeters just in the hour. this is been more than 600 millimeters since, and the result of that huge volume of water over a short amount of time, shut -- flooded streets, swamped shops. some of the subway stations had water pouring down into the platforms, and the cleanup from this and the disruption from this is likely to be extensive, certainly much more extensive than what was feared from last

week's typhoon. this is actually caused by the remnants of another typhoon, and i think one big question that many residents have today is, why was there no warning of this when people were going to bed last night. there was rain, but there was no warning that we were going to experience such a natural event on this scale. vonnie: even though people in our hong kong euro got to work, there is no trading and nothing in the southbound exchange for the moment. is this something to do with el niño, or is this something that we will just keep seeing in hong kong and is there any kind of forecast for how many of this kind of event we will see this year? richard: the local observatory here has warned that hong kong is likely to experience more extreme weather events as global warming heats up. having said that, hong kong does

-- is regularly affected by a number of typhoons on an annual basis. this time around but this typhoon in this storm certainly seems much more extreme than we had in the past. >> those cars look start to me, so i wouldn't try to walk home i walked to work. richard, thank you. thanks for keeping us in touch. that's richard frost, senior editor in hong kong. that's year from me and heidi for the "daybreak asia" team. markets coverage continues. standby for bloomberg markets, china open. this is bloomberg. ♪

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♪ >> good rainy morning in hong kong. it is 9:00 a.