:00:00. > :00:15.Now on BBC News, all the latest business news live from Singapore.
:00:16. > :00:23.Indonesia is a nation in shock after the first terrorist attack in
:00:24. > :00:33.Jakarta for six years. Led by China, it is a big weekend for the Asia
:00:34. > :00:45.infrastructure investment bank. Good morning. Glad you could join us
:00:46. > :00:47.for Asia Business Report. We start with Indonesia and South East
:00:48. > :00:51.Asia's largest economy is counting the cost of shock attacks which
:00:52. > :00:56.rocked the capital, Jakarta, yesterday. Seven people were killed,
:00:57. > :01:03.including five attackers, and 20 were injured in a gun and bomb
:01:04. > :01:07.assault in the heart of an area popular with locals and foreigners.
:01:08. > :01:11.How much damage will these developments do to the country's
:01:12. > :01:17.already weakening economy? We're joined IR business reporter. And the
:01:18. > :01:25.head of equity strategy. Thank you for joining us. The attacker was
:01:26. > :01:31.jury is still out whether this will and for the rupiah currency,
:01:32. > :01:35.jury is still out whether this will have an impact on the Indonesia
:01:36. > :01:38.economy. That's right. The stock market fell 2% immediately after the
:01:39. > :01:45.attack, but somewhat recovered afterwards, and only surplus 5% at
:01:46. > :01:50.the end of the day. That has been similar to previous attacks
:01:51. > :01:56.including after the 2009 attack in Jakarta. The bigger impact will be
:01:57. > :02:00.on the actual economy, for example the impact on tourism. We have heard
:02:01. > :02:06.from some of the region's large carriers saying that passengers can
:02:07. > :02:10.now change their flights to and from Jakarta without having
:02:11. > :02:15.fee, indicating that some people are reconsidering their trips to
:02:16. > :02:20.Jakarta. Tourism accounts for 9% of the country's economy, which is not
:02:21. > :02:23.as big as compared to Thailand, but the government has been trying to
:02:24. > :02:32.increase that. This attack would be a big blow to that. You lived in the
:02:33. > :02:37.Indonesian capital during the turbulent times of the late 1990s,
:02:38. > :02:41.the Asian financial crisis and the violence that took place during that
:02:42. > :02:46.period. Do you think this attack on Thursday will have an impact on the
:02:47. > :02:53.economy? I lived there in the 1990s, and there would earnings in those
:02:54. > :02:58.days. All kinds of things going on. At that point in time, I was
:02:59. > :03:01.surprised by the resilience of the Indonesian people and its economy.
:03:02. > :03:06.It went through a massive downturn and it was a different story. But
:03:07. > :03:13.people were able to get by and make their way through that turbulent
:03:14. > :03:16.time. My initial idea is that even though this is a tragic event,
:03:17. > :03:20.especially for the families involved, for the broader economy, I
:03:21. > :03:28.think this is a temporary issue. That is what the bank is suggesting
:03:29. > :03:37.on its website. It is a challenging time for the president. To calm
:03:38. > :03:41.investors' fears, but only around these terrorist attacks but also the
:03:42. > :03:49.economy. You could call it a test of the administration among investors,
:03:50. > :03:54.because Widodo was elected with the hope he could address issues like
:03:55. > :03:58.the economy and terrorism. Critics could argue this is yet another
:03:59. > :04:03.example that the president has not been able to address those issues.
:04:04. > :04:09.Widodo has not really lived up to expectations. What
:04:10. > :04:12.clients right now who are asking questions of what they should do
:04:13. > :04:17.with their Indonesian assets? It is true that the expectations they came
:04:18. > :04:27.straight after it is election were very high, but I'm not sure we can
:04:28. > :04:32.blame him for this, but they need to spend more money. We see that is
:04:33. > :04:36.slowly taking place. It would be nice if it was faster, but even if
:04:37. > :04:42.the money is there in Indonesia, getting things off the
:04:43. > :04:50.ground takes a bit of time. What about the cut in interest rates by
:04:51. > :04:56.the central bank? Was this able to boost the economy from where it is
:04:57. > :05:04.at the moment? It should be supportive. The rates in Indonesia
:05:05. > :05:11.have been high. There will be cuts coming through in the second quarter
:05:12. > :05:20.of this year. The deficit is there, that it is not alarming. The economy
:05:21. > :05:23.seems to be OK, and hopefully the impact of that fiscal spending will
:05:24. > :05:28.come through. We think a rate cut was appropriate, and the central
:05:29. > :05:33.bank thought the terror attacks were probably a temporary thing. You have
:05:34. > :05:37.attacks in Jakarta including the potential for Islamic State threads
:05:38. > :05:42.in the region, as well as the other risks, especially lower oil prices
:05:43. > :05:50.and concerns about the Chinese economy. That is the sentiment right
:05:51. > :05:53.now? Are investors starting to pull out their investors from emerging
:05:54. > :06:01.market economies in the region? I have not seen data yet. There are
:06:02. > :06:08.stories going around, but people are nervous and markets are down. That
:06:09. > :06:16.is when redemptions take place. The core of this are the changes to the
:06:17. > :06:24.rate in China. The head of equity strategy of HSBC, what are you
:06:25. > :06:29.telling them? Should they be fully invested in stocks or cash? Through
:06:30. > :06:37.the first part of this year, we will have volatility. With the exchange
:06:38. > :06:40.rate, things will be frontloaded at the beginning of this year. We'll
:06:41. > :06:46.have to deal with some of that volatility. We can equate that to
:06:47. > :06:52.events we cannot forecast like what we have seen in Jakarta. Late in the
:06:53. > :06:56.year, money flows back into markets and that will support some of the
:06:57. > :07:01.equity markets. Are there any particular sectors that stand to
:07:02. > :07:10.benefit in the midst of all of this risk? Benefit is difficult. I would
:07:11. > :07:12.say there are particular sectors which irrespective of what is
:07:13. > :07:19.happening will do well. Some of them are policy related, China related,
:07:20. > :07:23.wind and solar industries with clear policies, the Internet, which is
:07:24. > :07:30.growing in China, but also the Philippines, Indonesia, there is a
:07:31. > :07:36.growing trend. Banks reinvest the money people put in them. It is a
:07:37. > :07:38.growing trend that happens irrespective of what happens with
:07:39. > :07:49.the economy or on the political side. Those themes are something
:07:50. > :07:59.people should look at. Thank you both for your insights. Let's take a
:08:00. > :08:02.look at will rebound in in Asian trade after an eight-day drought
:08:03. > :08:10.that saw it fell to $30 a barrel -- oil. There are worries Iran will add
:08:11. > :08:22.more oil. This is how prices are now trading in Asia. Brent crude
:08:23. > :08:27.currently at $30.82 per barrel. The rebound in oil has given a boost to
:08:28. > :08:37.the Australian oil companies. Running -- man climbing -- one
:08:38. > :08:49.company has climbed 6%. The collapse in oil prices has put pressure on
:08:50. > :08:54.BHP, despite a write-down, they still have plans to invest $1.5
:08:55. > :09:07.billion in the onshore US assets this financial year. Let's have a
:09:08. > :09:16.quick look at shares. Intel plunging 5% after investors were not
:09:17. > :09:21.impressed at the fourth quarter. They have been looking for growth in
:09:22. > :09:26.the data centre in it to account for the slump in demand for chips used
:09:27. > :09:33.in computers. The Asia infrastructure investment bank
:09:34. > :09:38.ceremony this weekend. We have more in Beijing. China felt it did not
:09:39. > :09:43.have enough clout in the Washington -based institutions like the IMF and
:09:44. > :09:49.World Bank. Clout commensurate with its growing economy. It's now has
:09:50. > :09:56.its own institution in Beijing. China does not have more than 50% of
:09:57. > :10:01.the shares, but clearly, an institution in Beijing with a big
:10:02. > :10:09.save from the Chinese government will give the Chinese love and
:10:10. > :10:14.power. -- Chinese government. If countries come here
:10:15. > :10:17.expand their hydroelectric schemes are road systems, will there be
:10:18. > :10:25.political strings attached to the cash being doled out? Also, will
:10:26. > :10:31.fund is here divert funds from other institutions? There has been a broad
:10:32. > :10:35.welcome to this bank everywhere apart from the government in
:10:36. > :10:42.Washington. Allies of the US government are involved. Thank you
:10:43. > :10:45.for investing in your time with us. Goodbye for now.