manus: new year's hangover. chinese markets slump after they reopen after the holiday. the u.s. surges by the most in more than a decade after support from the central bank. and japan is also in the doldrums. gdp contracting more than expected as abenomics failed. hsbc will remain headquartered in the u.k. david cameron entered the final week of negotiations. warning his continental counterparts that it brings it would hurt them, to be -- that a brexit would hurt them, too.
you are welcome this monday morning. i am manus cranny. this is "countdown." let's get to one of the biggest market moves since 2005. the onshore yuan has moved significantly. ,e are on holiday for the week the chinese. they came back and looked at dollar weakness and they adjusted the yuan appropriately. by thejusted the yuan most since 2005. this is the hong kong valuation. let me show you the actual onshore yuan. you have this quite dramatic move in terms of the onshore yuan. they moved in terms of adjusting the valuation back. this is about combining the information over the weekend, imports declining for the 15th
month. the head of the pboc absent from comment for many weeks, dismissing the need to tighten, saying there is no incentive to depreciate the yuan. that is what this move has done. let's show you markets in terms of what they are doing. all predicated on the view that you may well see the japanese do more. mario draghi speaking today. it is the first back daily decline in normal month. best commodity out there. you are seeing this rejuvenation in the japanese equities, all hanging on the possibility of iran is on course to deliver their first target to europe. that is more supply coming on. how is the market positioned? net long positions rise by 5%. that is stellar performance in crude on friday. we are seeing traders building up your long positions to the
highest since june of last year. 114 sinceot reached the 10th+++ of course, what you are seeing here is a shift by the hedge fund. they are cutting their long dollar positions. let's get to caroline hyde. good morning. caroline: china's trade numbers underlined the challenges facing the economy. exports fell for a 16th straight month. the biggest on record. the currency six-month depreciation has yet to boost the competitiveness of the chinese industry. meanwhile, japan delivered some disappointing data. the economy shrank more than expected in the fourth quarter. stocks soared on the expectation of more stimulus from the bank of japan. its has decided to keep
level headquarters in london, saying the u.k. is an important economy. the decision was passed unanimously on sunday following 10 months of debate. hsbc has been based in the u.k. for 23 years and says remaining there is the best option for customers and shareholders. it is president's day in the u.s. and that means stock and bond markets are closed today. president barack obama will be at work, greeting leaders from the association of southeast asian nations for a summit in california. he is $53 says million in debt. he made the revelation on twitter. he asked his fans to pray he overcomes the situation. he also asked them to subscribe to the music streaming service tidal. global news powered by more than 2400 journalists. manus: let's get straight to zeb eckert. i am looking at my screen.
topix up 8%. nikkei up 7%. the top three markets are all literally soaring. technician, to a they've have been saying that it's oversold and that is what is driving the market. give us your take. zeb: if you look at the markets today, we are seeing that buying on the thought that the markets got too far last week in terms of the selling pressure. that is why you are seeing this advance on the msci asia-pacific index. a nice rally for the nikkei. look at that. 7%. ofsaw the 7% drop at the end last week. shanghai coming back from the lunar new year holiday. that is what stocks are red. they are playing catch-up, so to speak. it is a modest selling, just over 1%. we will keep an eye on that. banks and property shares in focus today.
, the hang seng is advancing. these are the movers we are tracking in the session. you are seeing insurers doing well. not a huge number of decliners. ping an, nice performance with a 7% gain. these are the movers we have been following in the tokyo session. iag life insurance, for example. on the downside, you are seeing about 3%. that is related to some restructuring costs. we are following airlines closely as well. , reports that the philippines airlines might be making a big order at the air show. we have a pilot strike in thailand that is impacting pilots. hainan airlines out of china might the making an
investment in portugal, you're part of the world, manus. investors taking the chance to buy after the abysmal finish to last week. nice to see some positive cues in the market. will it last? that is the question. manus: absolutely, it is. the debate as to whether the additional stimulus has an impact on growth. zeb eckert in hong kong. thank you very much. let's turn our attention to the yuan. it surged the most in more than a decade after the central bank governor voiced support for the exchange rate against the dollar. for more, let's bring in our emerging markets fx and bonds leader, robin. given the trade data that we had today, you look at these exports and imports numbers and that raises a whole host of other global questions. will the strengthened yuan be
short-lived? i think you are right. sustained over the shortest of terms. what happened today was after the markets opened, they were just kind of playing catch-up. the bloomberg dollar spot index fell 1% last week. it is kind of catching up. what was interesting to me is we saw the onshore yuan playing catch-up to the offshore, rather than the other way around. now. 1.24% the rates were trying to converge and now they have achieved that almost completely. manus: the chinese export data
declined more than expected. that is something that the economists possibly missed. should we be more concerned about that? record trade surplus. what did you make of it? robin: this is a problem we have seen with chinese data. we have had really good estimates coming in but it is very difficult to predict what goes on behind closed doors. table look at the imports , hong kong rose 108% if the data is to be believed. every other country decreased. this is reason to hold probable fake invoicing for people discussing this to get money across the border. this is something we will have to look at. we will have to investigate this further and see if these figures are reflective of what is happening in the market. manus: thank you very much.
in our guest host for the next hour. thank you for coming in. big moves. the chinese were away on vacation. in many ways, people were saying, you had the most volatile of markets. huge moves in oil and the chinese were on holiday. it is your problems, not necessarily ours. data.ou look at the trade how concerned are you about the trade data? exports down 11%. imports down for the 15th month in a row. quite the destructive data, isn't it? there chart that we see is unlikely to be sustained. it is not the policy direction for the chinese central bank. our core position is a gradual weakening quarter on quarter.
the continuing challenges of rebalancing the chinese economy come in fits and starts. we are required, going back to what they're comfortable with earlier on in the early 2000's, where a weaker you want was a cornerstone of their export-led growth. despite the words about speculators driving the yuan lower, it is still part of the policy mix, which we would expect to continue throughout the rest of this year. manus: when you read the central bank governor's comments over the weekend, a couple of things caught my attention. there is this sort of rowdy discussion around capital control and dismissing the need for capital controls, saying there is no need for that. my question is, how are the markets seeing capital controls? some of the markets would say that it is pragmatic that they
are seeing a difference between capital flight and capital outflow. how would you describe it? simon: stuck between a rock and a hard place. this was the final par 4 christine lagarde and her committee in accepting the yuan to then quickly reversing that position and limiting capital flow would take them negative by markets. one of the concerns you would have about the comments over the weekend's other people talking about currency pays -- pegs. markets being very concerned that it does not provide any assurance over long-term commitment to a currency peg. manus: there is a great article on bloomberg this morning that says the net -- the negative rates story were -- worked very well for the swedes.
but it does not deliver growth. this is where the markets were hugely antagonized. on one hand, they are sending a message that negative rates are destructive and do not create any value. on the other hand, listening to this need for more stimulus from the bank of japan. the advantage the swedes and the danes had was the first mover advantage. now everyone else is signing up to go negative and further negative. it is a comparative story, not an absolute story. we need to look at -- negative rates in the context of what central banks say. markets were assured last year, has the dollar went on its run and sterling chimed in, there were at least some currencies in the world that had strength against which the other major coulding countries
devalue against. that is simply not the case. is it a race to the bottom now? it kind of has echoes, very uncomfortable echoes, of the devaluations in the 1930's in the echo of the great depression. we are getting similar policy reactions from global central banks 80 years on. manus: i have got to do a word itrch and find out how to do , which is we are all talking about recession, but the reality is something different. that is right. the japanese growth print we had come up point four cent -- .4%, was in line with their trend growth given where their demographics are. the demographics are the key for this. in 1992.ked in the -- from that point forward, it becomes harder to squeeze out any economic growth.
you have a scenario where we have to be much more comfortable with nominal figures much lower -- then we had pre-financial crisis era. manus: you will be with me for the next 45 minutes. we have a lot more to get to. a hugely important weekend in terms of what you need to focus on. today is president day in the u.s. stock and bond markets are closed. on, ecb president mario draghi speaks to european parliament. on wednesday, it is all focused on the federal reserve released of the minutes from the january fomc. on thursday, this is as though we really hits the high spot. the leaders of 28 eu governments begin a two-day summit in brussels with renegotiation of britain's membership.
london,t is 6:19 in 7:19 in frankfurt. check out the u.s. routers. they are on a tear this morning. we have the asian market update. the dow jones up just under 1%. have these markets seen the bottom? you can see the topics rise by over 8%. u.s. equity futures on a run higher. caroline hyde is here. caroline: hsbc has decided to keep its global headquarters in london, saying the u.k. is an important and globally-connected economy. the decision was passed unanimously on monday following 10 months of debate. hsbc has been based in the u.k.
for 23 years and says remaining there is the best option for customers and shareholders. taking a hatchet to their bond-trading cap -- businesses. about 70% of credit traders cut in london last year at the 12 largest investment banks. that is according to data compiled from headhunters. asia's biggest air show kicks off in singapore this week. boeing and airbus are pinning their hopes on demand from china as orders from india and other southeast asian countries slow. boeing says chinese airlines will require about 6300 new planes in the next two decades. that is about 17% of the global total. back to manus. manus: shares surged in japan today. data,s after poor gdp
expectation that policymakers will boost stimulus outlooks. shrank.d's economy let's go to tokyo now. jody is our japan editor. what factors led to this day this week? ones one of the biggest was that private consumption was way down. when you do not have consumers purchasing much, that does affect the overall gdp number. exports were also all. the one bright spot was that businesses were spending. , the the market turmoil yen strengthening, that may not continue given those factors in 2016. there were a number of factors. -- there was no big driver of the economy in japan in the first quarter. manus: therein lies the whole
question about abenomics. in terms of this young real effect that we are saying, -- that we are seeing, is that expected to continue? yes. that is a concern of economists. you will have one quarter of growth and another of contraction. the third quarter was initially a quarter of contraction and then it was revised to growth. we come back to the fourth quarter and it is contraction again. the economy has not been able to take a foothold. has not been able to get on that growth path, which was the promise of a abenomics. we are not seeing that and there is real concern about what happens in the first quarter given what we talked about in terms of the strengthening yen and corporate profits. corporate profits might be off from some of these strong showings they have had in 2015 with the strengthening yen. manus: thank you very much. the challenge is very clear.
let's bring in simon french. we listened to jodi and she said there is no real driver in the last quarter of 2015. abenomicson is, is a -- is abenomics broken? simon: it is only partially functioning. it is only the monetary arrow. the physical element is certainly broken. increase and the anticipated increase from 8%-10% coming next year has taken markets extremely badly. one of the challenges of the japanese gdp data is its volatility is second only behind russia. very difficult to read quarter to quarter. butnow it is slow growth, whether there is traction being
brought to bear in the third arrow, the japanese labor markets, is very key. and the embedded psychology of a deflationary environment. thes very difficult to see sole indicator of that gdp growth. the second-most volatile series of gdp data after russia, which brings us to some other data. these are the japanese automakers in terms of the net income for honda, nissan, suzuki, and mazda. they are all being trimmed back. this is the net income across these companies. again is rising. -- the yen is rising. this is knocking their profits and abenomics. abenomics is higher pay rises. simon: and one of the problems
that is not just unique to japan is the complete front lining in earnings growth. clearly, the yen has a crucial part of the abenomics strategy. it is the labor market that is absolutely key here. it is pushing an inflationary mindset into pay settlement. the last week of quantitative easing from the bank of japan trying to encourage the bond iteratedoes that now into those that are showing settlement above the rate of inflation? if you start to see significant wage growth, is that the trigger for the boj to start buying corporate debt? it could well be. you think likely do that is? everyone is grasping for more stimulus from the bank of japan. what form should that come from?
on thethe boj governor tape this morning saying they are not going to hit normal people with negative rates. monetary policy from the boj increasingly looks like fiscal policy. it is more the kind of targeting you would expect from an elected government rather than the central bank. there is very little debate about -- there is more debate in the u.s., in congress last week, and in the u.k. then you are seeing in japan. very little discussion. a lot of what kuroda manages to do would be the envy of many of his central bank kin. manus: stay with me. we have a little bit more to get to. we will talk oil, the global glut and the implications of the price of oil. all of this as iran loads its first cargo ship of oil to
7:30 in brussels. caroline: china after trade numbers for germany underlined the problems in the economy in germany. almosttrade surplus of $63 billion, the biggest on record. suggest the sigma -- six-month depreciation has yet to boost the industry. there are more doubts about him and x -- abenomics. stocks soared on the expectation of stimulus on the bank of
japan. the military government has been left with a series of stimulus measures. 2.8% in december from a year earlier. you democrats have pushed for congress to vote on the appointment of the supreme court nominee from president obama following the death of justice scalia. willlican leaders have a not consider a replacement of the 2016 election. asking prices for london homes have reached another record after the winter low in the market came to an en banc. be searched as the average price is almost 600 46 pounds. that is your business flash. manus: in terms of these
markets, we were checking on the u.s. futures and the nikkei roaring ahead. this oversold story really beginning to gather more pace. caroline: i love that you are bringing me in on the oversold nature of things because i have a technical indicator. the relative strength index. just type in rsi and you will see we have the trade signal. we were oversold. this shows that anything under 30 on the relative strength index really does say it is time to start buying. suddenly we see a surge in the public's today. the best they that we're on track for since october 2008. are really we gathering a pace it comes to whether or not it is time to buy or start realizing that you have
hit that low and there are certainly the technical indicators showing that way. the topics in japan really going great today all stop that's in spite of a weaker than expected gdp in japan or the weaker than expected trade data from china stop nevertheless, we are on a terror. we are up 8% overall. financials are the most battered . everything is trading more than 6% higher on an industry basis. we see we -- we have a sea of bright green this morning when it comes to the topics. clearly everyone is hoping that the central banks will start to check-in. we've already had verbal intervention in china to support the yuan. the biggest move you have been focusing on already since 2005. you really see them trying to
support the one versus the dollar. the pboc governor rating his silence and telling us some big moves happening on the yuan and lastly, we are seeing risk aversion. we're suddenly getting a bit of risk appetite which means you're seeing the selloff in the yen. if you're typing in the likes of wc rs today, world currency can also see the aussie dollar outperforming despite that weaker than expected trade data coming from china. manus: lots of functions for our audience to consider there. the european central bank president loves assessing to himself. he made a statement today i have the policy meeting on march 10. anything that he says, the nuance of his word in terms of
the next move. let's go to our european economy reporter jeff black. what to expect from the speech? >> it comes after a very difficult week on the european markets. so draghi as we are accustomed to as a knack for being able to turn sentiment around just by dropping a hint about future stimulus or his comments on the state of the economy. you 3.50 weeks away from the next policy meeting what we are looking for a something that might instill confidence. so thing that might say the european economy is certainly so about to fall off a cliff we could get hit hints of policy moves but because of the way the bank sold off last week, a discussion about more negative
interest rate might be received negatively rather than positively. manus: that is that moment of reality. of banks for the vanguard 2016 predicated on slightly higher rates and recovery. last week questioning the very existence of one or two of them. talk to me about scrutiny from other quarters, not least of all from the swiss. >> this is just heart of the military furniture in europe if you like. the swiss are obviously very heavily impacted by whatever decision the central bank takes. the ecb's decisions are just a fact of life that they will have to get used to. the idea that there will be more easing rather than normalization from the ecb is not good dude
not goodf those -- the news for any of the central banks. manus: mario will be listening to that later. our chief economist back into the conversation. i've written down that it's not just the next rate move, it's about being convinced that draghi and his cohorts have really got a hand on the tiller. >> because the preferred measure inflation is back where it began . that's where the qe program commenced and they took it all the way up to 1.8. if he would like to provide signals to the market he will have a more skeptical market than he did at the turn of the year. then he slightly rolled back and did not increase the rate of purchases.
if he wants to make a material impact on inflationary expectations he needs to be committing to buy not euro zone bonds but oil. he needs to be buying containers full of oil. because the cost of expectation is that unprecedented levels. manus: i cannot help but have a laugh that it is taken all his depth of emotion to get his cohorts to buy government bonds. the markets to not believe that more negative rates are the answer to inflation or deflation . >> that's absolutely right and i do not believe that they are. i think we have come to the linnet of what monotremes stimulus can do. to the asset price appreciation route if you look in terms of lending there is a dearth of demand for lent thing not the
supply that is the limiting factor. let's talk about what is realistically achievable . >> it's a very fair point and to answerst the unglamorous is to increase the speed of purchases by 20 billion euros per month and extend it for six months. it probably needs to be more open-ended than that. he has very limited room for maneuvering. >> simon french stays with us. a ron's first should of oil since the sections were lifted is on its way. it's a tanker for the french company to tell loaded on sunday at cog island in the persian gulf. the prospect of a surge in iranian oil production is one of
the factors that has pushed crude below $30 per barrel. roy -- ryan chilcote is here. -- he said meide this this morning, this is your letter the map. >> it allows you to track shipments and tankards around the world. in this case we know the name of the ship so i simply went in and searched by the name of the ship. this is the first ship that will arrive in europe with post sanctioned iranian crude. it is headed for romania. it is just now moved out of the persian gulf, just away from hard island which is where to tell is loading up its ship right now. it slowly going to make its way up to the european continent. but it's actually an
extraordinary type of function that allows you to find ships and hunt ships. if we had not known the name of the ship we were looking at, been we did in this case we could simply zoom in on an area and look for ships which is what oil and whale watchers do. and not only look for ships in the main placed at seaborne iranian crude exits the country from but they even look at the depth i which the ship is down because that is how they tell how much it has on board and in that this shipow probably had somewhere around one million barrels of crude bound for europe. it's phenomenal the people are able to track what there is around the world. x 30 years ago people used to stand on the coast with
binoculars and check out the chip -- ships and try to measure how down they were and that's what moved the oil market people keeping track of these shipments. manus: let's talk about something else about oil market volatility. what if you got here? this is volatility and we are searching and this is where i want to bring you in simon. what draws the sharks into a volatile market? volatility is the highest and seven years in terms of oil. for an economist only what you perceive, the a ran story -- i mario draghid like to buy oil but failing that, what do you make at the moment. we do not seem to be breaking toward the 50 or 60 that the oil majors want to see. >> to start with volatility there is an awful lot of mean
reversion investment strategist quite like the idea of a bounce in levels that are not cash generative to the majors and are expecting a short-term balance. my personal view is that we focus on the supply side of the story and come back to the market, for me the future is the tainted by the demand side of the oil picture and there are technological transformation away from oil and into green energy. there's parts of the west coast of america, australia much are many becoming enemy -- energy independent for oil for their core energy production and that from he stops the bounceback in its tracks because the calculus cross opec has to be that we get
the ground while the remains a strong market for it. >> with the uae and oil minister talking about the appropriate rice of oil will stop ryan, you have been covering opec for many years. we are jockeying here in terms of the language for opec. is the reality? >> the reality is everyone is pumping as much as they can right now. if they even for a moment reduce their production then all they do is cede some market share to if thereelse and maybe is a rise in the price of said eyes the very competitors they are trying to take out to the point of demand you were just talking about that's what you are watching. we got interesting day that this morning from china, the world's biggest crude consumer and what
is interesting there is because i do not think it's because chinese industry is going green but it may be a chinese growth .tory in the month of january, we learned this morning that crude imports of fallen 24%. it is a drop from a record and an interesting thing to watch. but it is really china and the other markets around china that have been drying -- driving the .il story for the last decade manus: to want to bring in the summer did amick that we have. everyone's becoming heavily informed about what baker hughes really is but the number of active rates by 59% over the past two weeks. my question to anybody out there looking at this data -- this is
maybement in time when the policies are beginning to work. icing goldman sachs, this morning and they are talking about this rate counting a real push to fix supply out of the .ystem >> what they will want to see is the drop in production as opposed to just the drop in rigs but this is a leading indicator. goldman sachs are saying that on the back of this information from last week they are forecasting shale production to drop by 425 thousand barrels which is more than they thought earlier. >> a quick caution is that a 60% drop in u.s. rate count and production remains there 9 million barrels per day. numbers of rigs shifting toward the most productive rigs -- >> that's because we americans are efficient folk.
manus: it is 6:50 here in london and 7:50 in bloomberg. caroline: hsbc has decided to keep its global headquarters in london saying that the u.k. is an important angle of the connected economy. the decision was passed unanimously at the board meeting on sunday. hsbc has been there for 23 years and says her mating there is the best option for those customers and shareholders. thanks are taking a hatchet to
their bonded trading and the biggest casualties seem to be those with must experience. what can the financial industry more than 10 years. that supporting the data file by a headhunter. there are claims that the former volkswagen bus was told about the emissions cheating devices as long ago as may 2014. the german banks as a vw staffer wrote to the ceo saying the company could not provide an escalation for elevated nitrogen levels in the u.s. regulars would investigate. they admitted last september that some engines have been fitted to be emissions tests. playmakers, boeing and airbus have demand from china and as orders from india and other southeast asia company flow. boeing says the chinese airlines would require about 6330 new
planes. but 70%. that is your bloomberg business flash. manus: david cameron is entering the eye no week of negotiations over britain's future in the european union and the message for his continental counter art is very simple. -- youwould hurt you to too. angela merkel made her views on the matter clear. >> my wishes that the united kingdom is and remains an active member of the european union. naturally the british will decide for themselves. this is in germany's interest and i also think it is in britain's in the interest of the entire eu. >> our next guest argues that brexit would make u.k. firms
less attractive in terms of investment. he is the paul s policy chairman. that is ataying and boost. >> that is good news. they are a major global bank and have looked long and hard at where they should be and have decided to stay in london and it is a welcome decision. made it aar you've voice of how many jobs could be under threat in the case of a brexit. what it wouldut really look like if we wake up in june and have voted to leave .he eu what would it mean in terms of the city of london doing business into europe? immediately it would mean nothing while the terms of exit were being negotiated but it immediately introduce much uncertainty to those business london forrized in the u.k. to operate throughout the european union.
they would have to make a decision of do they boost .perations anywhere else they would want the negotiations of the exit to be concluded quickly so they know where they stand. wouldcertainty in itself not be helpful. >> the city of london as you say, european firms can invest without difficulty. correctly if i am wrong, your job is to convince the rest of the country that there is a tax implication and a jobs implication for the firms which stretch beyond the square mile. there is a huge disconnect between what they really think of us in the square-mile. >> i'm afraid there is an there is work to be done in the whole city. it's clear that a successful city of london is good for the
country. in the city. jobs there are more financial jobs inside london than outside and in and we keep telling people that jpmorgan is the biggest private sector it bournemouth. >> do you think you are doing a good enough job? can always do much better and given the financial crisis -- it benefits the whole economy but there are many thousands of people throughout the country whose jobs depend on what goes on in the city. ofus: if we saw the mayor london, boris johnson come outside more vocally, would that help? will -- i'm sure that would help. have had a look at one of the foundation studies -- it
is a survey of 700 businesses. almost one third would consider moving jobs out of the country. it's his book u.k. businesses and german businesses. this is a real risk in terms of getting the message out. what is to be benefited? rather than that negative campaign, what is the key benefit of staying? >> it's not easy in the same way to convince people of the benefits. they are widespread and there are more jobs throughout the country. there are benefits we can spend on the services that the government needs to provide. there is a job to convince people and i think that everybody in the city has got to play their part in explaining their view and what impact it would have on them.
manus: japanese stocks soar as opec post its biggest gains since 2008 and week gdp numbers drew speculation of more stimulus. the pboc raises its fixing and voices support for the exchange rate. .he victory for london hsbc will remain headquartered here in the u.k. his warning his continental that brexit would
hurt them, too. are watching "countdown." we have roaring equity markets in the asian sector. topics up 8%, nikkei up 7.16%. you are seeing this quite significant move in the asian market. we are set for a higher opening across these equity markets in terms of what is happening in london, paris and frankfurt all moving a little bit higher. we have a much stronger opening here the to the little bit of a problem with some of the moves here. ball, theve played
pboc governor says he has dismissed the need for tighter capital controls. got money coming out of gold, money coming out of the yen and nymex crude also moving a little bit lower. gold is down for the first back-to-back daily loss in over a month. the best performing on the bloomberg commodity index. oil below $30 per barrel as he run begins to shift. so the market is beginning to build long positions in oil. high and a three month you have dollar-yen coming back to the 114. hedge funds are cutting long dollar positions. the dollar-bulls are running for
the hills at the moment. we've had some breaking news across bloomberg. let me tell you what it managed to do in terms of numbers. fourth quarter organic sales up 7% of the market. the market was looking for 4.7% on the upside. organic sales for record in kaiser. thece beat for them in markets are moving higher. we will look for a higher open kirilenkowill stop stocks have soared in tokyo with the top exposing their biggest gain in seven years. investors judge that shares have been oversold and report shows that japan's economy shrank more than expected boosting the outlook for central-bank stremme -- stimulus. china's chait numbers underline the challenges facing the economy. that left a trade surplus of more than $63 billion. the figures suggest the
six-month depreciation has yet to boost the competitiveness of chinese industry. child and's economy grew more than analysts expected in the fourth quarter. gdp expanded 2.8% in the three month through december from the earlier. expectation has been for a 2.6% gain. hsbc has decided keep its global headquarters in london sing that the u.k. is an important and globally connected economy. the decision was passing and mostly sunday following 10 months of debate. they been based in the u.k. for 23 years and said remaining there is the best option for both -- both customers and shareholders. its president they which means both stocks and those are close today. which means president obama himself will be at work greeting asian nations for their first u.s. summit which kicks off in california. kanye west says he is $53
million in debt. he made the revelation on twitter and asked his fans to help them overcome the situation and urged them to subscribe to the new music streaming service where his album is currently exclusive. manus: let's get straight into the started showing you what the asian was up to with top it's -- talk is -- topics up over 8%. joshre up 9% at one just juncture. >> it's a roaring day and stocks are down from a seven-year low in tokyo. as we take a look at these markets across the region today you are sing it filtered all across the region bucking the more dismal gdp numbers and the trade numbers in china. by 6/10 of lower it
1% because the market is back for its first trending day. you would expect given the sharp declines that chinese shares are paying a bit of catch-up. it is modest selling pressure there. these are some of the big movers. we are tracking insurers and not casino shares. in noted that the tokyo market has a solid performance there with a 7% gain on the nikkei and 8% on the broader topix index. let's take a quick look at how some of the energy-related shares are performing. we have seen oil not necessarily where it was friday but this is how the chinese oil companies are performing. seen a couple about 6% in that session.
as we finish up with a check of the japanese financials these were star performers. in mitsubishi u.s. j with a nice solid performance there. perhaps markets were oversold last week and perhaps people getting in and buying and investors taking a chance to buy some of these assets that did see sharp declines. will this market continue the upward climb. or will he get back to some of those more dismal pieces in the world economy that prevailed last week. that's the great question is is the week begins here in asia. manus: altec a rally any day of the week. datafter we improved gdp all stop that will boost stimulus efforts. the world's largest coming shrank by 1.4%. let's go to tokyo, jodi
schneider is standing by for us she is our japan economy editor. what practice led to the gdp drop. >> a big one was a drop in private consumption. that's a large number larger than expected. all the areas where off except business investments. as one economist told us there was no good driver of japan's economy nothing that was really propelling it along. manus: in terms of the seesawing, are we expecting more of that? what is the current thinking? been a lot of signs the 2015 was the year of seesaw. we saw two quarters of contraction, two quarters of growth and the third quarter
they thought was retraction and then they revised it. given market turmoil this year and the yen strengthening significantly more than 6% before today, those factors really speak to the concept that we may see more of this particularly as the strengthening yen affects corporate profits -- profits. especially with consumers hanging on to their pocketbooks it's hard to see how that changes very much in the next quarter. much: jodi, thank you very with the latest on the japanese gdp. let's bring in the head of global asset allocation at a on aeon hewitt.
what do you make of that is there and up -- an opportunity to sell? very sensitive to any bit of good news. unfortunately those medium-term problems and markets are still with us so it's hard to argue that this is a real turn for the better and that it will be sustained. manus: you are right. in the space of 48 hours, what has changed since thursday or friday? but how bad is global growth. yesterdaying notes afternoon saying that we withdrew -- that we are through the worst drawdown in equity markets and -- where do you i think the >> panic probably was overdone but there is no question that we have really struggled in terms
of delivering decent rates of growth and problems have worsened. not that drastic number of nominal gdp you should be looking at. with inflation hovering around zero there is not much there in terms of growth and that is what andcts business sales corporate profits and we have been in earning sessions for over two years now. that's the fundamental for call of the challenge in equity markets. manus: are you then navigate advocate of more negative rates from the bank of japan? you a believer -- not a justin bieber fan, but are you a believer in terms of more negative rates? >> i will tell you the real problem with central banks which is that the old formula of quantitative easing is pretty tired.
it does not shock all the markets. we desperately need a new dose innovation. which would be some sort of orbally coordinated stimulus maybe infrastructure spending stimulus financed by the central bank so the central bank rights checks but some sort of global stimulus to boost growth. governments do not want to take this additional spending on their own books because public debt is maxed out in too many countries. arguably we need something more coordinated and better than buying government bonds all stop manus: all i hear you and we have a g-20 coming up. >> that is the certification upon which we could deliver something. manus: that we are in a race to the bottom. how in the name of goodness
could they go for something as radical as the new deal? >> the need for it is exactly that because we must move away policies andeived that's what we have seen so much of over the last five years. manus: give me some concept of a number or bandwidth that could be a vote in start of fixed -- capital expenditure. >> japan has this record of weight will infrastructure spending in the 90's. they did not particularly use qe at that point but now we know the developed world is short of infrastructure spending all stop look at the state of infrastructure. we need something coordinated that delivers additional spending because they are not spending that oil windfall they just had.
manus: apparently they are spending through. reached the point where some sort of coordinated attempt at revised economies is needed. manus: in terms of the japanese there's almost this begging for blood. if we don't get a g-20 solution this is the volatility on japanese equities and we are searching. the highest level in japanese equity since 2011. the market is pained for blood in terms of what the japanese should deliver. what can they deliver before this stimulus you are calling for? >> they can press on more strongly with structural reforms. they can pray and hope that the chinese economy stabilizes which would help because that has been a clear detrimental effect on
japan. there are things they can hope for and work for but the problem is that the underlying policy levers are not at full strength. they can't be sitting at 30% of gdp in the money stocks having double than quadrupled. you have used a lot of those things up so in a sense now it is far more tricky to deliver that stimulus. a globally cord efforts to me letting growth is one solution. manus: let's see with the g-20 can deliver. here is your week ahead. today is president's day in the u.s.. the stock and the bond market are both closer we do have equity futures trading. the ecb president mario draghi -- on wednesday the federal reserve releasing minutes from its
manus: it is 7:19 in london. 8:19 in frankfurt where they are up to speed. caroline: hsbc has decided to keep its global headquarters in london. they are an important and globally connected economy. the decision was passed unanimously on sunday. u k has been based in the for 23 years and say that remaining there is the best option for customers and shareholders. investors -- banks are taking a
hatchet to their training offices. about 70% of credit traders cut in london last year were from -- had worked in the financial industry for more than a decade. that's according to information from michelangelo search. playmakers going on airbus are putting -- chineseays that airlines will require about 6313 new planes worth $150 billion over the next two decades. that is your boom -- bloomberg business flash. manus: iran has the loading at first shipment of oil to europe and sanctions were lifted. the tankard is on its way to europe as we speak. it's one of the factors that has
pushed the crude price below $30. here we are, we have this wonderful story, the moment of when europe is expecting its wayt shipment, it's on its the reality of the supplies are coming home. >> the story has really moved on from people talking that importing iranian crew and the tankers now showing up. we have a tanker the blocks at the tall off the coast of the island. which is the output point for all of the iranian crude. there is a russian charter ship in the region. a spanish ship, for the international oil company's, a run ever since to throw things. one where it can get crude and if you are a refinery you want to get the crude. there is a battle for market share between the russians the iranians and perhaps to a lesser extent the saudi amongst the reciter's they're are all trying to supply that oil to those refineries and then there is the longer play story which is all these international oil stories
wanting to get into iran to help the iranians produce their fields. it is those tankers off the coast of a run in the persian gulf making their way to europe that's really giving us a new picture on the supply side of the supply demand equation one of the reasons why we saw w jet go below $30 per barrel. here we are, the reality of what's happening in terms of supply. volatility within the oil markets is quite a nominal. rally this phenomenal driven in the latter part of last week and that takes the reality of the ran coming back to the market could take us back to below $30. >> the issue is the here and now. the market in terms of that huge excess of supply is gradually
being worked off and is probably going to get worse before it gets better. view it is hard to argue that excess supply is not being worked off. near term we still have a problem because supply is still coming on and iran is one problem and particularly opec is still pumping oil and there is too much supply. as were one reason why we should not panic about global growth because demand has actually grown. it's really about the pricing of working through in terms of supply cutbacks. in 12 must time it will look much better in terms of what's happening in turn it in balance. >> we have some data that the whole world looks at and we are now on that in terms of what they've used and what the data and baker hughes actually means. take us through the data and perhaps that noted quarter we
had from simon french we are excited about a drop in rate cuts. >> we have the baker hughes data from the u.s. oil rigs on friday and it shows that we went from just over 450 rigs the week before to 439 which is a drop of 428 rigs. if you look at last week and the week before that's the biggest two-week drop we have seen in 10 months. there is this issue that we are seeing a dramatic drop-off in production. this baker hughes data which you can see by typing in big oil which is one of my favorite functions. you can see the index for baker hughes and look at the rig count and see that it has come off to medically. since october toy 14 it's full and threefold from above 16 hundred. everyone was looking for in the united states. crud, you look at dut
or production of oil, it has only come off a tad. everyone says there is a lag. but the question is how long. these american shale producers have surprised when with their efficiency as have the number of rigs of oil cut has come down we've seen efficiency go up and step goldman sachs got a note out that said these recent numbers are very bearish we do expense the amount of oil to fall off by about 25,000 barrels per day by the end of the year which is an increase of what they saw earlier. jon: the correlation of everything that ryan -- manus: the correlation of everything that ryan has just said has been a battering of high-yield. how do you look at high-yield at the moment? >> essentially we are on the in the energywave sector.
at $28 it is just not conceivable. about 4%e are talking to 5%, possibly a little bit higher. but the pricing has adjusted. we won't even talk about the energy sector because even the high-yield market as a hold where it is less than a quarter yielding north of 9%. so the market is effectively telling you that it us expects those defaults to rise substantially. i'm super i think they are right because it looks as though this is a place to do some fishing because there is not a lot of return out there and markets at the moment. >> we like it at the moment. ryan chilcote, great to have it -- great to have you with me. that's it for the countdown team. stock markets are rocking.
guy: welcome to "on the move." we are counting you down to the european equity open. what are we watching this morning? the biggest move for the onshore you want since 2005. china is back with a bang. it is significant. rocking the markets this morning and we are looking at a strong equity market story in europe. the topix and the nikkei soaring overnight. and, one flat mark against asia. hsbc deciding that london is where it would like to remain. it as