10/05/2016 Asia Business Report

Now on BBC News all the latest business news live from Singapore.

The latest victims in the fall of commodity prices. Japan's biggest

conglomerates are expected to report their first ever lost.

Goodbye Siri and hello Viv, we look at the next generation of artificial

intelligence that is exciting technologists. Good morning, Asia,

hello, world, it's Tuesday and glad you could join us. I'm Rico Hizon.

The fall in commodity prices is claiming another victim, later we

are expecting to hear bad news from two of Japan's biggest

conglomerates. Mitsui and Mitsubishi. They are what's known as

General companies and they trade in a wide range of products including:

They have traditionally helped to control Japan's natural resource

imports by making large investments in raw materials, but the collapse

in oil and metal prices have meant the two companies have already

warned investors they probably lost money for the first time since they

were founded nearly 70 years ago. Earlier I asked an expert why they

have so much exposure to the energy sector.

The fact of the matter is they are the quarterback or the core nucleus

of these two very big conglomerates in Japan and their role as a trading

company has ceased to exist given Japanese manufacturers can now trade

on their own. They have diversify, which was a good thing, but they

have gone into energy and the diversification has caused problems

and that's why we are seeing this excessive inclination towards

energy, resulting in this massive lost. What about the appreciation of

the Japanese yen? You have the negative interest rate policy

implemented in February, does this help or is this disadvantageous for

these major trading companies? Considering they do use bogus of

occasion into infrastructure for Mitsui and life science for

Mitsubishi... It should benefit them -- diversification. But we need to

wait six months minimum to see the saturating effect of these negative

interest policies. It's too early to tell. The most important thing for

these two companies in regards to the policy is their utilisation of

value chain and networking which you might think is their biggest

strength within the Japanese conglomerates. Basically

diversifying away a bit from excessive inclination towards energy

is their biggest hallmark right now.

The ongoing debt crisis in Europe continues to affect markets around

the world, but a deal may finally be reached later this month. That's

according to the head of the Euros group of Finance Minister is. Talks

were held in Brussels on Monday when Greek lawmakers also passed

controversial new pension and tax reforms but it was met with large

protests. Let's have a look at the reforms.

Moving now to other business news making headlines. The people who

co-ordinated the leak of the so-called panama papers have put the

whole lot online. A searchable database includes more than 300 and

thousand names of individuals and companies who have used anonymous

shell companies, including relatives of several Chinese leaders as well

as some Asian chief executives. China's search engine Baidu has been

told to reduce the number of adverts it includes in its search results.

It came after a student died from an experimental cancer therapy that

came top of the list in his Baidu Web search. The US doughnut company

Krispy cream, which has over 1000 shops in more than 26 countries, has

a new owner. It's agreed to be bought by Germany's J a B Holdings

for $1.3 billion. They own coffee brands as well as the luxury shoe

company Jimmy Choo. Tata Steel has confirmed seven bidders have shown

interest in buying UK operations. Tata and the industry blame cheap

Chinese imports for a collapse in steel prices. Now to the Big Apple,

where a huge technology show is taking place. It is called Disrupt

New York which highlights the technology that aims to shake up the

way we live. We asked Michelle Fleury to check it out and she found

a lot of excitement is about the next generation of artificial

intelligence. I'm at the cruiseship terminal in

Brooklyn and instead of tourists, as you can see, the room here today is

filled with technologists. Welcome to Tech Crunch Disrupt. A lot of the

buzz has centred around the creators of Siri, Apple's digital assistant,

they did a demo a short while ago showing off their newest creation,

it's called Viv, and it's what they say is the next generation of

artificial intelligence Assistant. We think there will be a new icon

that will be very recognisable, as recognisable as Bluetooth and

Wi-Fi. Will it be warmer than 70 degrees near the golden gate bridge

after 5pm the day after tomorrow? Sent Adam $20 for the drinks last

night. It knows who Adam is, it knows what it's about, we are going

to go ahead and send that. That's it. One of the questions that came

up is whether or not Viv could potentially replace search, Siri

routinely directs queries to search engines when it can't answer the

questions it self. This obviously wouldn't be the case with Viv but he

still thought there was a role in the future for search engines. And

when asked about whether artificial intelligence posed any dangers, he

said he didn't think so. Michelle Fleury in New York. Where

should you set up shop if you want to sell luxury goods? According to a

new report, Asia is your perfect destination. It is home to seven of

the top ten cities with the highest presence of luxury retailers. Hong

Kong is second only to London in its popularity, especially among

mainland Chinese shoppers. But look closely and retail sales in Hong

Kong have been falling for over a year and they were down almost 10%

in March from a year ago. The market is certainly down

particularly in the luxury sector for the hard luxury sector with

jewellery and watches being the most hit. Hong Kong has a market is still

fundamentally very good and it's an exceptional opportunity for the

luxury retailers. 30% of all the global luxury spend is done by the

mainland Chinese and 80% of that is done outside of China. Hong Kong is

in a position where it's a very attractive market for these people

to come to. And while there are still lots of global brands here,

that big presence of the global brands means it's an exciting place

to shop. The landlords in the major shopping districts, such as Causeway

Bay, Admiralty have also lowered their rents to attract some of these

big, luxury retailers. With the downturn in sales, the landlords

have had to be very proactive and be quick to adjust to the market. We've

seen a downturn in the market in Causeway Bay particularly and also

in Central. It's at a level now where it's affordable for retailers

so that's encouraging them back. Were also seeing a different sector

of retailers, not just luxury but more affordable and sports brands.

Apart from Shanghai and Beijing you have Singapore, Isaack and Tokyo

being centres for luxury retailers. Tokyo is still the second biggest

luxury market in the world -- Osaka. With the weaker yen over the

last 18 months we have seen a big increase in Chinese tourism and

we've seen an increase in sales for luxury retailers and more interest

from the real estate side. Let's have a look now at the

market. Asia heading in separate directions in early Tuesday trade

after stocks finished higher as games for drug companies were almost

cancelled by sharp losses in metals and energy companies -- gains. The

Nikkei 225 up 84 points due to a weak yen against the US dollar,

benefiting exporters. The warlords lower by 23 points due to falling

prices. -- the warlords. The Hang Seng will be opening in about 15

minutes. Those are the markets in Asia, thank you for investing your

time with us. I'm Rico Hizon. For now.