optimistic but the question is whether ai hype will pay off. ubs lifts stocks to overweight despite worries around the economy. the upgrade is funded by a downgrade to taiwan in korea. india's most valuable company mrs. earnings as weakness and taxes offset growth in digital and retail ventures. checking on markets with avril in the lion city. earnings in the u.s.? avril: that will be a key driver whether you're talking u.s. stocks or asia, today is mixed. optimism as big tech earnings come through, they will deliver

on big profits. we have comments from j.p. morgan saying the slide and equities is part of a deeper correction. it is not over if you look at how yields are rising and strength of the dollar. yen weakness has been kept in check by comments from the finance minister. we are seeing among japanese stocks that have been recovering, extending gains, not for racing losses. singapore outperforming, you get the sense that those indices are benefiting amid the rout in the sector. chinese tech is doing well. divergence between the csi and the hang seng as one bank

upgrades its call for chinese stocks. haslinda: it is from a low base. ubs analysts have upgraded china and hong kong to overweight. cutting taiwan and korea stocks to neutral, let's dig deeper with our equities reporter. take us through the reasoning behind the move? guest: the key reason behind upgrading is resilient earnings. msci china is trading at nine times. you look at the estimates there is better than the growth s&p is supposed to get. 14 or 15%. if you go back to the data and

look at earnings revisions, estimates are up by 12%, the first month to see earnings upgrades and that sets it up for the biggest monthly upgrade since november. so there is a fundamental reason or hope that backing ubs is showing up in consensus numbers. other reasons include shareholder returns, signs of pick up on consumption side in hopes that savings will flow into consumption and markets. this all has been funded by taiwan, tech heavy markets. the markets will do well, but if you go back and see it altogether, this is a call on ai

because of higher rates and tsmc worries. and a lot of focus going on domestic oriented markets, that is why this china upgrade has come from ubs. haslinda: you hinted asia stocks benefited from low exposure. how much of a lifts can that make? guest: yeah, this is the base case. we are seeing in nvidia, the philadelphia some conductor index correcting. higher expectations and some week outlook from tsmc and it is obvious that if ai is the focus, it is on ai. if you zoom out it looks like calls are becoming something

domestic oriented which offers relative value, so if you look at india, these are markets which offer high financials. the index has 60% rate of financials which tend to do better when the regime is higher for longer. in that context we have seen outperformance. lookout month to date performance of stocks. you then mx ap in the markets we mentioned. india and the markets have outperformed. margin is not high, they are still outperforming. haslinda: thanks the question whether the gains are sustainable. thank you for the update.

joining us now is daniel, deputy cio and global head of research. good to have you with us. we talked about earnings out of the u.s., do you think that is an inflection point? do it is not good enough. daniel: trend remains strong, backed by growth metrics. there is a difference between earnings and what markets are expecting. expectations are bullish, one of the reasons we see consolidation despite strength. gap between earnings and expectations. haslinda: a lot more room for disappointment? daniel: natural to expect

consolidation when we've seen a strong market. activity was in contrast with general expectations from wall street so we've seen the gap open up, natural to expect consolidation, underlying strength remaining reasonable, you expect to see the upward trend. haslinda: how long do you expect consolidation to last? when do you buy the dip? daniel: always hard to tell because you never know what the future holds, but these things last six or eight weeks, something like that and then you reassess whether it is geopolitics, rates, trends but

it's usually six to eight weeks. haslinda: we talk about earnings, were looking at apple, tesla because of exposure have to china. how might that play out for those? daniel: we've seen over the past five years desire for companies to diversify supply chains by moving production. we've seen success, but it is hard to do that in one swoop, so these companies are beholden to china. these companies are reliant to china for the numbers as a

potential market, things are important in absolute terrence. >> we heard from a colleague about how asian stocks are protected because of lack of exposure. you share the view or might we see a spillover? daniel: there are different parts of the asian market. tech sensitive markets like korea and taiwan or more sensitive to the u.s. because the u.s. is the center of the tech industry and other parts of

the market are more sensitive to domestic this use. those parts that are domestically sensitive whether it is consumption plays, they look firm. haslinda: how best to get exposure from trends like ai? do you stay away? daniel: i think the approach we've taken is to use the run-up as an opportunity. having enjoyed the benefit of rising markets and the concentration in tech, we've use this to diversify exposure regionally and by market cap size. small caps, more defensive

spaces and spread out. haslinda: the biggest risk would be? daniel: to be clear this is not our view, but we see a credit cycle unfolding quickly. we seen defaults in the first quarter, tentative rising delinquencies. and a lot of noise in the u.s. and this seems to be well contained. there is a risk that these get momentum and spiral, one of the things that we are looking closely at. haslinda: there's a story talking about central banking stress. might the rest of asia see a

similar trend? what are the risks? daniel: asia is beholden to events in the u.s. and china. as long as the u.s. holds up well, that bodes well, but we are seeing great divergence in global cycles and asia has to pay attention to china, so china weekends, that would pose a problem for asia. on the policy side, risk in the short-term is that markets take a signal from the fed to prevent domestic trends and banks are

forced to hike along with the fed. haslinda: daniel murray, deputy cio at dfg asset management. chinese double tea maker has plunged around 30% in its debut underscoring the challenges in reviving investor confidence. this is china's third largest maker of tea drinks. they raised 330 million dollars in the biggest ipo. the debut comes as regulators are taking measures to enhance cooperations with hong kong went ipo proceeds slumped to the lowest in two decades, take a look at that. down more than 36%. still ahead, jl else recorded real estate trends in the asian

pacific and why it was the only region to show growth. keep it here with us, this is bloomberg. ♪

♪ haslinda: this is a battle

losing, gold falling. using geopolitical risks reduced the rush. bullion is up 12% supported by central bank buying and demand from geithner and in dear. still with us is daniel murray at dfg asset management. to think gold has fallen, but up 12% is not too shabby. guest: it's a strong market. what is interesting is historic correlations have not worked this year. stronger dollar which goes hand-in-hand with weaker gold, all those factors -- it is

interesting we have not seen that. profit-taking overnight out of strong momentum in the gold market. the it's related to conditions in the market. haslinda: so you're saying gold is supported? daniel: i think so. as i say, we would've seen gold decline given the backdrop of higher bond yield, stronger dollar and increase in the vix index, we have not seen that. quite strong underlying bid, it is reasonably supported. haslinda: 2.5, what are you looking at? end of the year?

daniel: hard to put a number. what i'm looking for is how different factors interact. like to see how far the price pulls back when we've seen positioning unwind and how the price reacts when the blowout occurs and the strength of momentum reasserts itself. haslinda: given that you expect gold elevated on the back of risks, are the other haven plays likely to remain supportive? we are talking about the dolla, the swissie? daniel: it has been a year of paradoxes, not only in their relationship between gold prices

and fundamentals, but currencies. we see in the swissie become a big funded currency. dollar strength despite it all due to safe haven status. also due to massive risk in equity markets and currencies as part of the funding story. carry trade is back. haslinda: i want to touch on central banks. the fed and tce data, what are you anticipating, how much has been priced in, what has been raised in? daniel: we know the fed focuses on core pce deflator. that comes out late in the month. we get the cpi date or 10 business days into the month.

and although they are different, you can imply pce from cpi. the fact that cpi data was strong -- almost did not matter how you broke it down, headline, core, goods, housing, strong across the board. expectations are for robust pce. there is opportunity for the market to be surprised by the number. haslinda: when you look at a 60/40 portfolio, has not done well. daniel: the equity side of the portfolio has done well, but it has been else. if we see a slightly better inflation prints this week, that

would be beneficial for bonds. you expect a market rally. but also given the equity pullback, that would be helpful. and that environment your portfolio could do well. the other thing that could transpire is caps do better in a less inflationary environment. big valuation in gap so we might see small caps do well. haslinda: we have heard that before with emerging markets. it will be an em year, before i let you go, wondering what would be the trade in 2024? daniel: good question.

you could argue the trade already happened, short treasuries and longer dollar. i think for the rest of the year we are seeing the macro environment out. perhaps it is as simple as being long on equities and focusing on tech and that side of the market. haslinda: that is the most popular trade. thank you daniel, deputy cio and global head of research at dfg. keep it here, this is bloomberg. ♪ harlem has everything. but i couldn't find pilates anywhere. so i started my own studio. and with the right help, i can make this place i love even better. earn up to 5% cash back on business essentials with the chase ink business cash card from chase for business.

haslinda: csi 300 index under

pressure tencent is releasing dungeon fighter, lifting sentiment. they are a huge waiting on the index. jd and quite show also trading up. hang seng and hstech as well. take a look in terms of the china stocks rising as the government is buying network upgrades providing a live, companies surging 20% and also long kwong up along with beijing tayshaun type line.

the csi is in negative territory. a market on the way up for asia lifted by sentiment and tech earnings out of the u.s.. still ahead jl else is the asia-pacific is the only region that saw growth in real estate investment. this is bloomberg. ♪

♪ >> live pictures from shanghai, looks pretty good. totally blank. china heading to lunch. index is down for a third day,

by the way. ubs lifting its call on hong kong stocks to overweight. ubs is downgrading to neutral to fund its overweight call. take a look at where we are. pboc governor paul gong sean and the risk of inflation. china headed to lunch, japan coming back from lunch and we are doing a check in about the yen. avril: boj expected to hold on rates. varying inflation picture. some think we could see boj signals coming through.

dollar-yen hit 15485, highest level since june, 1990 despite the solider. -- softer dollar. we got the finance minister of japan bringing the verbal level back toward that level. seeing concern about risk given how traders are piled in one direction betting on yields weakness. leverage fonts asset managers based on yen weakness last week, figures have risen to the highest since records began in 2000 six. among the risks. as i say, what we heard from the finance minister has helped to calm what we are seeing on the currency.

guest: fair to assume the environment for appropriate action is in place, the i will not say with the action is. avril: stock benchmarks in japan fluctuating amid comments from finance minister, not giving us the sense of when we might see intervention, but conditions are conducive. we are seeing benchmarks pullback from march, the peak despite investor interest in how it has been a darling in japan. haslinda: amazing to think the yen is close to 155. thank you.

a new report says the asia-pacific was the only region to see growth in commercial real estate investment. japan is the most active market, 29% growth amid investor interest. let's discuss this with pamela ambler who joins us from our singapore studio. you've got to wonder whether japan is a stand out? pamela: japan is benefiting from weakness in yen currency, because if you look at policy, that is putting pressure on the currency and for japan it has been dominated by domestic investors, but foreign investors

is looking at that market, because not only do they have attractive fundamentals, they have benefit on top of that which is currency. haslinda: a lot going for it. you've got to wonder if they were seeing signs of overheating? pamela: pricing wise that is the one market where we have not seen downward pricing but what we see is japanese capital looking at overseas markets. in domestic market for japan, and a lot of foreign investors are looking for japan sectors. all sectors, traditional are doing quite well. haslinda: from japan, let's go to china.

are there signs the market is bottoming out or close to it? pamela: that is good question. investors are looking for the bottom in pricing. difficult to assess that and put a market price on these assets. what investors are looking for is trades that have taken place, discount in pricing in we have seen those so that is coming from developers looking to dispose of assets and foreign investors holding. what we are seeing is the insurance companies with state backed funding and end users occupying spaces stepping in taking advantage of pricing dislocation. haslinda: for those divesting away from china are, where are they putting the money?

pamela: seeing a slew of markets benefiting from this capital flow. the changes occur when investors who would have invested are now looking at other markets. india is another bright spot, not as institutionalized. seeing investments. another big market is the korean market, dominated by the mistake investors, asset managers have, against liquidity challenges and we're seeing less competition and an opportunity for cross-border capital. haslinda: might shadow banking impact sentiment? >> interesting question.

you see a pullback in liquidity, so how we assess is based on eating activity. that is weaker than historically speaking and as i mentioned, it is cross-border capital looking at investment opportunities. not as much competition and if you look where be ok is, they've been at that level since january 2023. consensus is the market will likely not be seeing any increase in rates. will will be reduction. haslinda: we know that the u.s. commercial property sector is under stress. perhaps we are seeing a

spillover when it comes to europe. might we see wider contagion? an impact in asia? pamela: what we're seeing, people are talking about vendor capitulation. sellers are accepting the market price, willing to come down in pricing. we seen a big adjustment happening in the markets in america and europe, that is not something be seen on a large-scale in a pack. laces where we have seen pricing coming down is led by australia and korea. those markets are places where we are seeing certainly pricing adjust the most. haslinda: we have to talk about singapore. you are there and we know investments have been held back by the high rate environment. what would it take investments

to come back? pamela: we are already seeing the retail sector staging a comeback. retail has been embattled over the time of the pandemic. we are seeing picking up in consumer spending adding based on previous valuation cycles. another thing is it is not just retail, hospitality, singapore is a destination where it is attracting tourism and supporting investments. haslinda: a pack investor, thank you for joining us today. now let's get you hooked on fx markets. joining us is mark cudmore weighing in into a growing

debate over whether to focus on nominal yields, mark, willie nominal -- where you stand on this? mark: this is a piece by simon flynt about who is correct. longtime viewers know i am disdainful of economists and take the side of traders almost always. for our colleague, simon, when it comes to fx markets those who are dominant are traders and the way you make that phrase is is it nominal yields or real yields that control markets? in theory it should be real. should not matter if nominal is higher. that is the case with emerging markets which do not have policy credibility.

take currency, argentina, extreme cases. it turns out most traders in the front seat of action do not look at inflation. that is strong when it comes to the yen. that backs up the idea that sterling has been more of an emerging-market currency. haslinda: you are a traitor. what would it take for economists to be right? mark: if countries lose credibility like u.k. and become more like emerging-market countries, it is an idea that for the last 40 years we have not cared about inflation. we felt like inflation was a dragon that we got under control.

many explanations whether it was the rise of china, global demographics, many reasons. however on the flipside there is the argument inflation has come back, we have gotten too complacent and the fed being dovish repeating it's policy errors and inciting about of inflation which is important for consumer pricing and sets a trend. maybe inflation is back. if it is back as a kind of constant red over the next two years, it might be the case that real yields become more dominant, but not yet. haslinda: dollar remains high. team is weighing on strong dollar as well. dollar index up 4% year to date. is that a wake-up call?

mark: there is a lot of excitement about the strong dollar. first of all the dollar has been strong. most people we are expecting stronger -- softer dollar. they're expecting yields lower. what this is is a dynamic of the fed not cutting rates in the fashion at the start of the year. the fed was talking about three rate cuts which seemed ambitious. we've priced out for rate cuts. the dynamic of higher yields is problematic for the world markets. this is the reserve currency. the fed sets policies so this is tightening the world. we are in the face of dollar strength. more to go, more squealing around the world as we see

tighter financial conditions. i have to say, we are several months into a story, more than halfway through. another month or so to go, but the dynamic for the second half of the year is currencies cutting less. haslinda: no rate cut this yeah. mark cudmore, we thank you so much. still ahead, reliance disappoints on profits, what is behind their week results next, this bloomberg. ♪

♪ haslinda: india kicking off trading with gains in the first minute of trade. stock volumes slumped. indian markets trading near peak. indian ruby trading at 83 versus

usd. one stock is reliance. petrochemical unit facing headwind. expenses are up at india's largest company and we are tracking geo financial services up as we speak. let's dig deeper. let's bring in sans j. key takeaways from the earnings? reporter: to start on a happy note, india's most valuable company had 10 rubies of annual revenue. but it reported lower than expected profits and weaker

performance. they demonstrated a good fight and offset gains. if you carefully see the chairman mukesh and bonnie made a statement that the business is challenging environment in fiscal year 24. and cfos said there is a multi-decade loathes in the last interesting point is like the capex for the industry was all-time low. that is sending a shock as triggers to indian banking system. cash profits and accumulates are the key takeaways led by the

billionaire. haslinda: what are the prospects for a turnaround? what are the areas in the coming quarters we should look out for? sanjay: one should keep watching price gains. they would be now going for revision of price targets considering the upside of business is one. number two, analysts are waiting for a value hike much awaited. that is the second thing we waiting. and the third thing very interesting would be the opening of a huge boost and the chairman

clearly stated they will bolster the investment. dates said -- as of now. haslinda: reliance up 15%. bloomberg can grommets reporter, thank you. still ahead, tesla reporting first-quarter earnings focused on margins and guidance after slashing prices including china. we have a preview coming up. this is bloomberg. ♪

awkward question... is there going to be anything... -left over? -yeah. oh, absolutely. (inner monologue) my kids don't know what they want. you know who knows what she wants? me! with empower, we get all of our financial questions answered. so you don't have to worry. empower. what's next.

>> tesla in focus and focus will be on price cuts and the impact in china. with bring in peter in sydney. what are investors looking for? >> hi, expectations are for a green set of numbers. we've seen a drop in deliveries to goose sales growth.

expectations a drop in operating profit in the first drop in revenue in four years. analysts are looking for clarity on tesla's strategy going forward. there's been news on tessler in the past few weeks, a lot of quick shifts from elon musk starting with big job cuts the weekend before last and the seeming shift from mass-market model, going all in on a robotaxi. given the amusement in the share price it is down more than 40%. slowing sales, compression, investors are waiting for

coherent message from us on where the company's galway. haslinda: a big question is whether tesla has room to just keep cutting rates in response to sales slowing on the back of lee auto doing the same. peter: it seems they might be cutting in reaction to slowing sales. we got a report from evercore saying tesla might be unprofitable because it has cut prices simo. you can only cut prices sorry much before there's other things you need to address in one of those is it has a limited lineup and relies on the model 3 and the model why and you've got competitors from baywatch day

you have everything right through a range of cows. you've got lay although, coming out with really interesting tech heavy cas that appeal to chinese buyers. tesla is stable. haslinda: peter in sydney, and you so much. we talked about cut in prices in china. a check on how stocks are doing in asia. head of tesla's earnings. check where we are. byd is down he in the opposite direction. as we count down to tesla's earnings, this is one company that cut prices not just in china, but other markets like u.s. and germany after disappointing sales.

one more look at the chinese bubble tea maker chow by dow plunging 40% in its trading debut, underscoring the challenge the financial hub is facing. we have of companies, 10 companies have made ipo's to risk $300 million. chow by dow down 35% on its debut. that is it from bloomberg markets: asia. this is bloomberg. ♪ ahhh ahhh ahhh

her uncle's unhappy. i'm sensing an underlying issue. it's t-mobile. it started when we tried to get him under a new plan. but they 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! it's not a lock, i know a lock. so how can we undo the damage? we could all unsubscribe and switch to xfinity. their connection is unreal. and we could all un-experience this whole session. okay, that's uncalled for.

♪ >> this is bloomberg. if asian shares get a boost as investors turn optimistic on big tch