Bank, Australia, Reserve Bank discussed on Bloomberg Daybreak: Asia
Ago Hang Seng index futures trading down now two hundred and twenty points or so that's about eight tenths of one percent. So if we boil it down there's so much happening today. But one of the most fundamental things is that we've got very strong US data on private American payrolls and on American services industries. So that's good for risk assets. And it's good for Asian economies. But it's just that what comes along with it is higher yields and higher dollar the dollar is right now the Bloomberg dollar spot at eleven ninety four the high of the year was eleven ninety six so we're virtually there. The doll yen one fourteen forty one that's a weak yen. And that's lifted. Tokyo equity prices were up about two tenths of one percent. But back to the story about the dollar and deals. The yield on the tenure up to three point one eight percent that was eleven basis points spike in one day. That's a lot a lot for markets to digest and the two year was up to two eighty seven which is a post crisis high couple of quick notes Li Ka-shing bought five point nine million CK acid shares over three days. That's according to filings stanchart lowers the Hong Kong GDP growth forecast. Three point six percent. And Billy Billy shares jumped in the United States eight percent after it was learned that ten cents was upping its state. All right. Nineteen minutes past the hour to San Francisco. Ed Baxter has news. All right, Brian. Thanks US. Navy's proposing a full show of force near the South China Sea CNN reporting that is proposing a series of operations during a single week in November sailing ships and flying aircraft nurturing Anna's territorial waters in the South China Sea and Taiwan Strait. It says in navigation free passage international waters that is the premise on which its planning to warnings and North Korea's attacking finances of as many as twenty three countries on says hundreds of millions of dollars in the banks of at least eleven other countries US is backing away from the Trump administration goal of North Korea denuclearization by the end of the Trump term in twenty 2021 reports are that the FBI is confused about its goal in the confirmation investigation. It is not talked with either judge cabinet or Dr forward, but their reports that the. FBI pro paperwork is out and that senators can view it privately secure area. It should be made public. They are saying to Mara. We'll have to see how that time-line holds up. The mayor of soccer Japan says he's ending a six decade sister city relationship with the city of San Francisco to protest a statue here honoring women forced into sexual slavery during World War Two the so-called comfort women global news twenty four hours a day on Aaron a tick talk on Twitter, powered by more than twenty seven hundred journalists and analysts in more than one hundred twenty countries in San Francisco, I'm Ed Baxter. This is Bloomberg. Juliet, and thanks so much. Let's get back to our conversation with Illinois, Cray strategist, Australia market, at Sexto capital markets on the line from Sydney Eleanor, Doug was setting up that story that we heard from him Kelly warning that Australia's property slump could threaten the banks and economy, and this comes after UBS gave that warning that the banks could be under pressure due to the financial standards inquiry as well. What's your view on the financial sector in Australia? Certainly we believe that the financial sector could be under pressure. Also are few reasons behind the so obviously staying in the housing market that was really as well confirmed yesterday with the talked to housing declining planning approval, really showing that downtrend easing tact. And we all still expecting a decent amount of new supplies come onto the market as well towards the back end. But that's only going to cement the downward fall in housing also seen as well. An increase in regulation coming through studying banks, the Royal commission on the banks as well. I haven't put aside a lot of fun remediation costs. We've already seen Westpac last week increase the amount that they'd have to put aside full remediation. For all feed into quite a negative outlook for the Bank. We're also seen as well that they've had to tighten credit standards of that really caused slow slowdown credit growth. A sent me the banks will remain on the pressure. However, I think that the other side of the story Webuye the yields that they offer is very attractive compared to other stock market. The yield is still around seven. But I guess you need that increase yields the titans on. Risk that comes with your capital investment banks, but they are going to pressure. So given the two things that are happening here. There's the housing market. There's the financial system, and I guess three things the overall economy where does this really leave the Reserve Bank of Australia? So I think we heard this week that the Reserve Bank sent me gang to remain on hold for the time being. And that sent me out you at Saxo as well that the Reserve Bank will remain on hold until twenty twenty. And I think actually what we're seeing playing out in the housing market. It's feeding into a story now that we really can't rule out. The next move actually being a cop. Obviously, we've got consumption contributing to around sixty percents of GDP in Australia. So if we do see this folding, how the prices continue we will see how companies after pressure from that at this could severely impact household spending. But now, actually the most recent economic data that we've seen coming out of Australia has that she'd been Donka and it somewhat concerned confirmed the Reserve Bank's optimism over the past few months. Wait and see story here in stadia just wanted to get your thoughts as well on China and J P Morgan of cost cutting these Chinese Stokes on. Risks of a full-blown trade war. You don't think that we will say China? The weaponize the Awan d. No. We don't think that China will recognize the on. And I think that movement that we've seen most recently have come for the PBS be focused on financial stability and in not maybe maintaining key level in the Yuan. But in maintaining a against those lodge moves in the Chinese. So we don't think that the Chinese will. Actively weaponize the Euan. All right. Eleanor cray. Great to get your thoughts. Very quickly twenty seconds. I'll say do you have any top conviction trades through to the end of the year? Tuck conviction trades through to the end of the year is remaining a.