haidi: welcome to daybreak

australia, markets have just come online. annabelle: i'm in hong kong, county down to asia's major market open. little momentum as u.s. inflation and retail sales reads are coming, strong demand for a 30 year auction. haidi: many japanese workers are set for the biggest wage gains in decades, a positive sign for the bank of japan before he meets to decide on ending negative rate. annabelle: a bill to force a sale of tiktok in the u.s. has the senate setting up a fresh flashpoint between washington and beijing. haidi: let us get you straight to the start of trading in sydney, alphabetically we are seeing already a bit of upside when it comes to trading.

we do have a modest gain to close in the session, largely being supported by banks and consumer discretionary stocks. we are watching wind stocks again with framing of expectations of those punitive 220% tariffs after three years of being in place. those are the biggest aspects to this market, gaining yesterday. look at the aussie dollar, holding firm at the 66.23 level. this is as we consider -- continue to look at how the dollar plays out. it did ease with those haven plays in the detent space but the broader dynamics really are much more interesting when you take a look at how young the polls are going to contend with potentially the next ppi, retail sales, the last couple of pieces of data before we get to the fed.

take a look at how japan is setting up today. the drumbeat rolls on head of the bank of japan with the positioning of these expectations and arguably when it comes to the end we are hearing from the likes of columbia saying that the direction of the yen is really dependent on where the fed goes from here. not the decision from the bank of japan. we are still at the hurdle there. annabelle: it is a countdown for the boj meeting, we are fairly steady as we, my buddy moves in the session we saw them retreating somewhat from the all-time high. nasdaq futures in the context of the moves, losses were felt in the tech space, dropping with a handful of big tech. traders are awaiting these readings on inflation and retail sales and we had the uptick somewhere in the february cpi

print, headline ppi prices were also expecting to rise. an rebound in energy prices and retail sales are likely to rebound with unfavorable seasonal adjustment factors. they were weighed in, february, expecting somewhat of an improvement. it is the last inflation reading before we get to the fed meeting. the context of the trading as well, this is the longest stretch we have had for the s&p 500 since 2018 without a drop of at least 2%. there is momentum that is going higher. haidi: i want to bring in a bloomberg opinion author, this is kind of really the conundrum you have been thinking about. we continue to see concerns of a stock market bubble, as that bubble across other asset classes as well, perhaps we are in a situation where record highs are followed by more

record highs? >> one of the things, newton's laws of motion, the momentum is strong and it is interesting, take a look at how the s&p 500 momentum index, the index that gained the most, it gained the least. it is beating the index by the most since the 2000's. this is quite remarkably momentum driven rallying, not the overall index is going up so strongly that it is being led by the company that has a big move behind them. i think in general, part of the reason, you can have some confidence that maybe this is not a bubble because so many people are worried about that is. it is when everybody saw that there is nothing to worry about.

it is when the last affair has capitulated -- bear has capitulated, that is when you get worried. sentiment has indicated that it is not a cheap or great time to buy, but not designed to have it now while you can. it does make sense. the final point why things are looking as good as they are, primarily in the u.s., earnings have -- i am writing a piece about this, the earnings for next year because of the nasdaq 100 have taken a leap to the 80's. it is startling to see how sharply earnings expectations have inflected up.

obviously, a lot of the earnings, not just from nvidia, that we saw in the last few weeks. it has been very good. annabelle: on the earnings, is that the ai sort of factor that is playing into it? what are we seeing an uptick in expectations do you think? >> my fear, i think the earnings we have seen has an immense amount today with a lot of capital expenditures and being devoted into people desperately buying things to take part in ai and obviously in particular buying things from nvidia. you can see that with some of the other big tech companies as well, obviously meta benefited from ai. that i think is where i have the greatest concern. the earnings are real.

this is not like 2000 when it never made any money and people still had it up. the question is whether this is one big one off investment by people who feel that they have to be in on ai or they will be in trouble. this kind of buying is not going to be sustained. i think it is a concern. shery: we are looking forward to your column, that is as bloomberg has learned that boj officials are considering scrapping the buying of pdfs provided that their inflation target comes in. let us go out to our asia senior editor joining us from tokyo. we were discussing this yesterday, brian. about this retreat, what i'm curious about is the boj only

about etf's three times last year, why do they need to actually formally abandon this? >> good morning. but is a great question. i think they have have already sent a single they are moving that direction. the only bought three times last year and earlier this week we saw the nikkei plunge in the morning session 2%. the boj refrain from buying etf's on that day, probably a single that it is thinking about cutting off all new purchases. the next question is going to be what they do with the massive holdings that they built up since launching the program in 2010. those holdings now valued at about ¥70 trillion which is equivalent to one year's worth of national tax income. that will be something the boj will be talking about. we have heard that they are not

going to worry so much about coming up with a solution for handling existing assets immediately. they will think more about other parts of policy when they make their review on monday and tuesday. haidi: we continue to wait for the wages data, we have some positive signals out of toyota. we are waiting on the tally that will get to us by friday. >> the excitement in tokyo is palpable. all of the signs we are seeing is looking to point towards big wage increases, ringo comes out with the overall tally on friday. we have some members of the big collection of unions are a number of unions came out with their agreements yesterday and they were all around 5% or more. that points to the possibility, i do not know if the final tally would be that high. it will look like it is going towards the high 4's and that

would be the biggest wage again in more than 30 years, a piece of wage again that exceeds inflation for the first time in a long time. that could send a signal to consumers they can feel more comfortable about buying and in turn sends the signal to the boj that it's cycle of wages and prices is coming to fruit. that is what they will talk about next week. annabelle: the countdown, to the boj meeting, brian in tokyo. moving to the u.s. the house of representatives has passed a bill to ban tiktok unless its chinese owner sells the app. critics have accused deplatform of being a national security threat. >> that is the responsibility of congress, our responsibility to guard against these kinds of nationalistic security issues. that is why we acted on this, we

are not talking about banning tiktok, this is up to tiktok, bytedance, they make the decision on whether they want to go it away or whether they want to divest themselves of the ownership of this. haidi: walmart let us bring in our tech reporter. -- for more, let us bring in our tech reporter. annabelle: i do not think tiktok will go down easily and we can expect a significant pushback as well? >> we reported they plan on fighting it in legal venues and tiktok ceo actually just released a video in the past few minutes here reiterating that that they will fight this and advocate for users and and continue to do everything we can to exercise our legal rights. even if this bill does find reception in the senate which is still a question, it gets signed off by the president who says he would sign this bill, you have

some kind of other venues that bytedance and tiktok might take here to keep any kind of divestiture from happening. a divestiture or a sale would be the last case scenario in the eyes of the company. haidi: there has been a lot of criticism from tiktok over the way that this came through extremely quickly? >> there has been and it seems like a surprise on the tiktok side. there have been bills in the past that aimed to limit the access to tiktok for u.s. users and this one is different because it is focused on i divestiture. not only did it come as a surprise when it was introduced, the vote in the house took place quickly, the ceo of tiktok happened to be on the ground there, my sources tell me having run-of-the-mill meetings in d.c. which coincidentally ended up being part of their strategy as they shifted their lobbying efforts to the senate now that this has passed in the house.

this took them by surprise which is an interesting point because bytedance and tiktok have been spending a lot of money on lobbyists who have been trying to kind of end of the worries of the national security concerns that we have seen in washington dc when it comes to this company and it existing in the u.s.. haidi: who is going to emerge as the buyer or the potential bidders for tiktok if we get to that point? >> it is a super interesting question and you also have an antitrust regime under biden and the head of the ftc who is not kind to big tech and does not let them do large acquisitions. some of the obvious players like alphabet might be off the table just because biden's ftc regime does not want them to be too large. that is an open question. the bill itself only specifies divestiture. it is not specified as to have a u.s. owner.

there could be other options like an ipo or an state sale -- estate sale. they are not wanted to give tiktok the roadmap. if the company is in a position where this bill is signed into law, it seems like they have to consider all of those options and see what the government says. haidi: much more ahead, exclusive interviews with the chief executive after a firm reported a surge in a business value led by asian demand. we take a look at investing in real state at the moment -- real estate and we speak with ralph to see where he is seeing opportunities. this is bloomberg. ♪ that's a different story. i couldn't slow down. we were starting a business from the ground up. people were showing up left and right.

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headlines when it comes to chinese property, the long dated dollar bonds are slumping, a default may come. it felt to as low as $.40 on the dollar this month and it is an indication that investors see the possibility of default despite a company's link to the government. showing loss and less concern of an imminent implosion. a lawsuit sinking under liquidation of builders, the builders say they have not had a 30 day trading grace period. it will tries to raise -- they will try to raise funds through dispersal and spending cuts. annabelle: let us stick with property with high rates of denting property valuations, let

us discuss investment opportunities with ralph rosenberg our next guest ralph rosenberg, global head of kkr . property owners are refinancing assets and you are on a trip in asia. how are you seeing those forces playing out so far? ralph: you have to look at the answer of your question market by market, you guys were talking about china, the great cycle in china is quite accommodative for income producing real estate owners. the cost of financing is well inside of the yield you can buy stabilized properties. for in china. the same is true in japan. it is a different tale in a little bit more directive to your question, korea and australia, the high rate cycle which is similar to what happened in the united states

and europe has caused the lady negative ratio to come into play were property yields are lower than the cost to borrow. that has to reconcile itself over time to get to a more natural equilibrium where property yields are actually slightly or modestly higher than the cost of finance. annabelle: you mentioned china, the rates environment is attractive at the moment. we have discussed at length the issues facing the real estate sector, using issues there currently? ralph: the speculation you referenced is associated with the housing sector and the office sector. there are other parts of the chinese real estate markets that are quite stable and healthy. namely the logistics market in

beijing and shanghai is relatively healthy. as is the equipment i multifamily rental apartments which is -- especially in the area that is multifamily rental apartments. in china, that is a long-term asset class in china. annabelle: you are in tokyo, i want to start there in terms of what opportunities you are seeing. haidi: it feels like we are at the point of a sea change for the japanese economy and this virtuous cycle. you had a couple of significant transactions. what are you doing in town and what other opportunities are you on the lookout for? ralph: we are super excited about the opportunity set here in japan. last year and a half ago we purchased from mitsubishi and ups the second largest real estate management platform in the country we have rebranded kkr japan realty management.

that platform alongside of our really dominant pe franchise here collectively is allowing us to unlock a lot of real state value in the local marketplace. the market is generally in equilibrium. there has not been a lot of speculative building in the residential sector, in the office sector in the logistic sectors, hospitality sector. we think that is interesting. to add on top of that, there is a lot of corporates in the country that have been sitting on real estate assets for decades in some instances where we think you can unlock that value and create a lot of shareholder value in doing so. create a lot of real estate value as well. haidi: does the pivot from the bank of japan and strength in the yen change the outlook at all? ralph: we think it is quite

positive for real estate. if you think about the role of real estate in an asset portfolio construction, it is supposed to serve as an inflation hedge. that is a new concept in japan. if you think about the ability to raise rates or rent at an annual growth rate that equals or exceeds nominal cpi expectations, think about the fact you can own and hard asset in inflationary environments, both of those attributes are unique to real estate are important to inflation and driven economies. you think it will be quite positive for real estate fundamentals out of your point about the bank of japan, raising rates. the spread between real estate yields and the cost to borrow is actually quite accommodative in japan. so long as the relationship between unlevered yields and real estate and the risk free rate states quite wide, i think

you are going to see a very accommodative investing environment here in japan with respect to real estate. haidi: you have spoken a bit about the scenario when it comes to australia and on the residential side. we are in the midst of a pretty deep property crisis. you see opportunities either across residential or in mixed-use or commercial in australia? ralph: do your point there are parts of the australia real estate market has experienced building, residential. there are other parts of the australian real estate market that are quite healthy. australia enjoys the lowest vacancy rate in logistics anywhere in the world. it is a 2% vacancy rate. what you see is distressed investing opportunities where there has been speculative overbuilding like in residential and prices will come down to reset the basis in these assets

or they can be let for rent at an attractive yield on cost. in that correction as you would expect there is going to be value and loss of equity from those who are speculative. with respect to the logistics cycle and hospitality cycle in australia, those are very investable asset classes. supply and demand equilibrium, the ability for a landlord to increase rent or the room rates in the context of hospitality are quite favorable to being a real estate investor. haidi: great to have you with us. the global head of real estate at kkr. much more to come on daybreak australia. this is bloomberg. ♪

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currencies. some easing when it comes to move in dollars. a pretty narrow trading range. market volatility underpinning current trades and making fx havens. we saw a rising oil prices affecting some of those proxies, including the likes of the aussie dollar at .66 us cents. waiting for wage data with the yen, and potentially with the boj does, but lift off, even if we get it from the bank of japan next week, it is not really benefit to begin, but what matters is what we hear from the fed. this is her uncle's unhappy. i'm sensing an underlying issue. it's t-mobile. it started when we got him under a new plan. but then they unexpectedly unraveled their "price lock" guarantee. which has made him, a bit... unruly. you called yourself the "un-carrier". you sing about "price lock" on those commercials. "the price lock, the price lock..." so, if you could change the price, change the name!

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haidi: disney's board focusing

on four divisional heads as part of the search for a successor of bob iger. those being considered are dana walden, jimmy potala, josh d'amr o and alan bergman. let's bring in our senior editor for media and entertainment, who joins us from los angeles. we know that disney has clearly struggled with its succession planning in the past. do you think they have learned lessons from that experience back when bob iger left in 2020, and will this time be different? chris: they seem to be making a stronger push and created a special committee last year that has four former ceos of other company on it. we are working with an outside executive recruiter having multiple meetings, interviews

with these staffers and senior operational people at the company. cognizant that they will all have the same level experience across theme parks, tv and corporate enterprise, so that is all the concerns taken into consideration. haidi: does nelson have a view on how the succession will plan out? chris: he has not said specifically how it would be different, but he has noted that the company has not done well in the past, and he thinks that he and the former ceo would add something to the board and push them in the right direction. of course, we are talking about the previous ceo sort of handpicked by the board, bob iger, and he left after less than two years, and bob iger had to return.

annabelle: where we are seeing a lot of activity away from disney is in india's media landscape. we had news that paramount was sending its india's tv stake. chris: what you are seeing in india is probably what we will see in the u.s. there were too many streaming competitors create airplane a lot of money for sports rights, and so we are seeing a rationalization of disney and elias agreed to merge tv businesses, and paramount had a smaller stake in the enterprise and it will get smaller with the merger. they have been looking to reduce their debt, so this $500 million sales will still be able to sell the programming through nickelodeon, mtv to the indian market, but will not have a direct share. haidi: that was our senior editor for media and

entertainment, chris palmeri. let's get how markets are faring. we are getting into the trading session. you are seeing some slight weakness, but broadly, this has been some do training. u.s. stocks are a little lower and the prize session. big tech did feel the brunt of that, but trade is bracing for the u.s. ppi data following the cpi rating that came in hotter than expected, so that is the trend we are forecasting with producer price inflation numbers and retail sales is where we expect a pickup from the january reading. u.s. ppi is the last inflation data before the fed meeting next week. the bank of japan we are continuing to track expectations. inflation data salary data, the march. could become more likely.

we are monitoring the boj signaling around the etf purchasing buying plans because they are axing that. that is what we are hearing from sources. it tells us that could set the stage for normalization of policy settings. aussie stocks into trading flat, but one sector we are watching are the copper mine because materials are leading the advanced so far. a couple are in focus because we did see the base metal hit a seven month decline. it is all about the capacity cuts. that is one part of the story. you are continuing to see that retreat that dropped yesterday on property concerns in china

thousand per square kilometer, and with more than 7000 people crammed into a square kilometer, hong kong makes greater sydney look like a peaceful village, and the villagers like it that way. to those who have closely studied sydney's refusal to grow

up instead of out, this type of protest is disappointing but not surprising. we are seeing many of those apartments threatened and there is resistance in some parts of sydney to increasing density, and those are inner areas such as eastern suburbs and northern suburbs are in those areas. um, we have affluent population living with a highly developed social media skills. are there very well organized, and they can influence politicians and so on and so forth. change is already happening. the new south wales state government is spending $37 billion on a new metro railway, one of the biggest infrastructure projects. the city has ever seen. the stations, along its route and other existing rail corridors have been earmarked as locations for high density housing. cities are not museums, so they are. they have to change. they have to evolve over time. as population grows and sydney's population is growing, sydney and while the debate over where to house that growing population

continues as house prices and rents continue to rise. paul allen, bloomberg sydney. for more on australia's housing woes, let's bring our economics reporter swati pandey. so this surge in migration has been well flagged, and certainly australia is not the only one that's sort of undergoing this. you look at new zealand as well. is this worsening the housing crisis? it is definitely worsening the housing crisis, in particular sydney, which is already the world's second least affordable market in the world. and we have seen sydney has expanded in the periphery and that has created an inequity able society where new migrants are going out and living in the suburbs, which are distant from where they work, and they are. they cannot afford to live near city center. and there are a lot of concerns about not just inequitable, inequitable access, but also about vibrancy of the city as a whole. and, you know, if you're

bringing in all these people into the country, you need to house them. he's going to be giving a prebudget address in sydney. we've had prices coming online. the big retreat in the commodity, as well. >> it is not so much of a surprise we have a second straight. it is driven by commodities. the estimate the government uses is usually on the conservative side. even though prices have fallen, it has been a windfall for the government. the downside is in the future years, there will not be as many revenue upgrades as we saw in the past couple of budgets.

it looks like we will return to deficit in the future years. that puts pressure on the government at a time the economy is slowing and unemployment is expected to rise. >> take a look at one of the movers we are watching to the downside. ozzie broadbent at the moment, we are down over 17%. at one point, it was as much as 25%. this is of origin termination of the labor deal. that was the most since 2022. the 25% plunge. the communication services agency saying they received an unexpected notice origin energy would terminate their wholesale agreement effective on april 12. and they requested for ozzie broadbent to continue providing certain services, potentially six months termination. it is seen as a significant blow to the company.

around 80% say -- material impact for your numbers according to jeffrey's reaction. coming up next, our exclusive interview with the aa group chief executive president lee yuan siong. this is virginia:. -- this is bloomberg. ♪

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annabelle: your aia group reported as mainline sales were boosted in china and hong kong benefited from cross-border travel, suggesting departure from the single-digit decline in 2022 when the pandemic constructed sales of the largest markets. joining us is the lee yuan siong aia group chief executive and president lee yuan siong. it is great to relate to what we came off in the pandemic era. was this due to the strength of what we saw in the mainland and in hong kong? lee: we are very happy with the results. as we said, we delivered a very strong report of 33%, and we delivered in markets across the

region. four major group engines of the largest group, mgm, hong kong, china and india collect strong in 2023. haidi: for hong kong, what is the capital investment? do you see that having an impact? lee: we do 83% in hong kong and the reservice, the middle class and the demand for insurance

products and we are seeing the momentum with business continuing very strongly. annabelle: they are saying that for every increase in the business value over the course of this year, that could equate to an average boost of 3.6% for your business. is that something that you are expecting, as well? lee: as well? we see that -- receipt continuing momentum -- we see continuing momentum across the four, across into the fourth quarter and carrying on into the first two months of the year. we are very, you know, confident

of the prospects of our hong kong business, and our chinese businesses, and in india into 2024. annabelle: tell us about what you are seeing in mainland china. are you making progress there in terms of geographical expansion? lee: we are very happy with the progress we are making in terms of expansion into new geographies. in fact, over the last five years, our footprint has doubled compared to 2019. in 2023, we were in the province, as well as expanding into multiple provinces, and we also created a full provincial

branch. annabelle: what are the next expects and provinces you are looking at? lee: sorry? annabelle: what are the next provinces you might be targeting? lee: we will continue to receive support from regulators, and we are expecting to plan for one to two new provinces a year. haidi: interest rates are likely to come down across the western central banks. does that impact the balance of opportunities that you see? are you favoring more equity or fixed income? lee: as long-term investors in the region, we manage so that we match the duration as much as possible.

and we do that and the currency of our policy. for example, in hong kong where we study the u.s. dollar policies, we will try to match our u.s. dollar of similar duration. in this way, you know instantly that we will be able to reduce the capital position from fluctuations in interest rates and the capital markets. and our solvency ratio is very strong at 75%, and it is relatively insensitive to changes in interest rate. annabelle: what about your product strategy? with new accounting changes, are certain products more favorable now? lee: reservice the long-term

protection of customers in asia, and we develop new and conference of solutions for our customers. with middle-class customers, we are much more resilient in terms of spending on services and insurance, as well, and develop products and of the markets that we operate. we operate in 18 markets across asia. annabelle: which products are you focusing on the most for the india segment? there was a really big revenue generated for you. lee: india is a very exciting market for us. we have grown our business very strong. and i think we can value that new business and india at 37%,

and over a time of eight years, we do have number 18 in the market to now at number three in market share and with private life insurance in india. the product we sell is mainly protection based, providing a comprehensive cover to indian consumers. in india, we have eight market challenge strategy, our premier agency in india is very distinctive. again, we are the number one company in india, and we have a high-quality banks and brokers in india, as well. haidi: that was lee yuan siong, group chief executive at aia. annabelle: you can watch us live

and see past interviews on our interactive tv function tv . you can dive into securities on bloomberg functions we talk about and become part of the conversation by sending instant messages during our shows. this is for bloomberg subscribers only. check it out at tv . okay y'all we got ten orders coming in... big orders! starting a business is never easy, but starting it eight months pregnant... that's a different story. i couldn't slow down. we were starting a business from the ground up.

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haidi: you are watching daybreak australia, the geopolitical stories we are following, antony blinken is calling on israel to boost the amount of food aid into gaza. he says supplies allowed in since the start of the war are not enough, urging israel to open more access points for overnight delivery to avoid the looting of convoys. >> the bottom line is, we need to see, as we have described it, we need to see holding his own when it comes to humanitarian assistance for gaza. haidi: a judge presiding over donald trump's georgia prosecution for attempting to turn over the 2020 election has tossed out several counts against him. scott mcafee dismissed three counts. the judge says the counts did not spell out clearly how the actions violated the law. after the indictment -- the

indictment remains in place. iranian drone attacks halted operations at three -- ukrainian drone attacks halted operations at three refineries in russia. it is one of the country's biggest crude operations. annabelle: just about seven minutes away from the start of trading in seoul, and the moves we are seeing in terms of one internationalization, that is a big focus on korea this year because they are expanding or extending the currencies trading session. today, what is going to be interesting to be tracking is that they are undertaking a another test of after hours trading of the yuan. we saw february 6 and february 22, but this time, some banks are going

to be allowed to exchange the dollar one pair in real time from thursday, so that is without any sort of predetermined factors like counterparties, so this is a point of difference because it is the first time today that we will see trading occurring on a real-time basis. so something to be watching is the extension of the onshore trading hours, it is slated to start from july. haidi: it is part of ongoing efforts of south korea regulators to try and ease themselves out of the emerging market basket. all of this intentionally benefiting its case to get its stocks and other assets moved into develop market regions. we have seen weakness when it comes to trading in the yuan given the moves that we have seen in the dollar recently. we have seen a couple of days of declines, and you can see the forecast of u.s. inflation data that gave a boost to the dollar,

but we have seen a cut of the u.s. dollar more or less range bound over the past couple of sessions or so. it is interesting when you talk about the number of registered foreign institutions allowed to trade on yuan swap as of monday, 13 entities so potentially the widening of that group will be looked at, as well. annabelle: and the official extension is slated for july, so a series of tests, and this is the latest on what is happening later. coming up, we talk market strategy with oreana financial services ahead of next week's boj and fed meetings. plus, taylors wines joins us.

>> this is daybreak asia. asia is major market opens, and we are focusing on japan, but japan really with those price negotiations, it seemed like based on what we got on wednesday, people in tokyo should be happy with salary increases coming through. haidi: yeah, and i suppose the issue is also what are the expectations for the yen. saying it is more about the fed than the boj when it comes to the direction of the yen. let's get to the open. annabelle: a big focus on really any action, do we get it in march or april? that is the focus as we get underway with japan coming online here. the yen holding fairly steady so far in the session, a little bit firmer, but