12/02/2018 Asia Business Report

its recruitment procedures.

Now on BBC News all the latest

business news live from Singapore.

Is the wild ride over or is it just

the beginning? We find out where the

global markets may end after the

volatility of last week. And and

enduring sports legacy. We find out

about triathlon's plans for Asia.

It's Monday, everyone. Good morning,

Asia. Hello, world. Thank you for

joining us for this edition of Asia

Business Report. We begin the

programme with the Asian markets

that are offered from heavy selling

last week following volatility on

Wall Street. We had the bench mark

indices in Japan, Hong Kong and

Shanghai falling at least 10% from

recent highs. Chinese equities in

particular were under pressure,

partly due to the weakening of their

currency. Should we be bracing

ourselves for another wild ride this

week? I asked that question earlier.

Investors seem to be responding to

increased expectation that in

flirtation will pick up -- inflation

will pick up. The strength that we

are seeing in global economy that is

driving market and as we may be in

the midst of this shift, I expect

investors will see more volatility

that has the workers went through

the market.

Inflation and potential

increases in interest rates are

basically feel all of this

volatility in the stock market over

the last week. On Wednesday, you

have the consumer price index coming

up in January in the United States.

Could this add more fuel to the

fire?

It could add more fuel to the

fire or it could dampen it somewhat

if we saw a softer than expected

reading. Traffic returns to the

issue that we will not see any real

closure in terms of this debate as

to what is driving markets over the

next several days and I don't think

that the CPI is going to do Edi

there. As the volatility works its

way through I think that investors

will be somewhat more defensive.

When we look across currency, I

think that means that nondollar safe

havens will outperform the smaller

and riskier currencies.

Last year,

many economists were predicting

three or four more interest rate

hikes from the Fed in 2018. At that

time, the market didn't move. Why

the reaction now?

That is an

interesting question as we have been

seeing rises in yields for sometime.

I think when it comes down to is the

difference in terms of what is

motivating that rise. If you had

asked most investors several weeks

ago what was driving, they would say

was growth expectations and that is

the ninth of the market. It is

probably less benign if risk arises,

is volatility arises and if

investors are more concerned with

inflation.

Briefly, how much of this

volatility on stocks is due to the

weakening dollar and stocks being

affected in China by their currency?

I think it is circular. A large

component is both each market drives

the other.

Remember the airbag maker

Takata? There are reports that its

US unit has reached a settlement to

end their bankruptcy. I'm joined now

by our colleague.

Is this a good

thing? It is and it is not,

depending on who you why. Basically,

the US unit of the company was

gearing up for a court fight this

week to get a judge a judge's

approval for its plans to exit

bankruptcy because there has been

strong opposition from injured

drivers as well as creditors. There

have been hundreds of injuries

related to these airbags. They also

caused at least 21 deaths around the

world. Over a dozen carmakers as

well is the new owner of Takata's

air bag business, they have managed

to agree a deal with them over the

weekend. They will establish a trust

to pay compensation and if the

agreement is approved by the US

bankruptcy court it will mean

injured drivers will not be allowed

to sue the carmaker. They will

monitor whether they gets approved.

We will have to wait and see if this

will push through. Thank you very

much. India's latest Federal budget

has drawn criticism from luxury

carmakers. The government has

increased taxes for foreign

automakers and that has affected

global brands like Audi, Mercedes

and others are doing business in

India. Our reporter speaks from

their auto show.

Luxury cars on display in the

world's third-largest auto market.

And emerging young and growing

middle class has attracted major

global high-end auto brands to set

up a shop in India. But after doing

so, with promises of tax incentives

from the government, car

manufacturers say the government

backtracked on its plans when it

announced a plan to hike tax on

imported auto-parts. Most global

luxury brands in India import beer

engine in different parts from their

countries and assemble at here. They

do that with a tax benefit promised

earlier by the government. Now that

incentives is withdrawn and

investment is in doubt. For this

man, who heads Germany in India --

Tarlee in India, this is a blow.

Currently very assemble within the

country almost 95% of its cars sold

here. Under the new regime, the cost

of doing so will rise substantially.

splashback we are making substantial

investments in the country.

We

believe in the growth of the marker

but we also need to make sure that

there is this growth scenario that

is now being restricted.

Luxury cars

make up 2% of the total vehicle

market in India. Foreign brands here

fear that further protectionist

measures could hurt their expansion

plans in the country.

Overall in

context I see that India will have

to review their policy as well on

bringing cars into the country. A

short-term hopeful gain of winning a

few revenues on taxation is not in

line with the positioning yourself

as a market welcoming foreign

investors. For now, luxury carmakers

say they will pass on most of the

tax sites to car buyers. And while

that may be a small difference to

those paying thousands of dollars

for rape high-end car, the shaken

trust between foreign brands and the

government will be a big hurdle to

overcome. -- thousands of dollars

for a high-end car.

A lawsuit has been filed against the

Weinstein Company alleging that it

failed to protect employees from

Harvey Weinstein. Becomes after the

Mogul's career ended in disgrace

over allegations of sexual

misconduct from over women. A royal

commission into Australia's banking

is set to get under way in Melbourne

they have faced scandals and

concerns over money laundering,

legislation accusations that some

institutions withheld legitimate

health-insurance pay-outs and gave

misleading financial advice. There

is no other sporting event in the

world where athletes and you are a

four kilometre swim, a 180 kilometre

bike ride and a 42 kilometre

marathon back-to-back. And did I

mention a 17 hour limit? Ironman

celebrated its 40th anniversary and

its popularity is growing in the

region. It was recently purchased by

a Chinese company. The chief

executive of ironman told us how the

sport started.

Ironman started from

the most modest beginnings. 15

people deciding to do the Waikiki

rough water swim, a bike race and

Marys on on the same day. Since that

day in 1978, every year more people

have crossed a ironman finish line

than the year before. We are now

truly a global sport. We have 235

event weekends in 50 countries

around the world. Despite us being

the dominant global player we think

that we have about 13% of the global

mass participation market and we

think there is an opportunity for us

to continue to grow are creating new

events and by acquiring other

events.

He has been extremely useful in the

Chinese market. He has deep

connections, not just within the

Central government but due to their

real estate development, they have a

presence and relationships in 100

Chinese cities. Those are helpful

for us as we think about getting

races off the ground, getting roads

closed, having direct relationships

with the cities and with the party

is vital and essential in China.

And

in the markets, it could be another

week of volatility in Asia. We can

already see it on the board here.

The Hang Seng is currently up by

0.7%. The All Ordinaries is down by

91 points. And the South Korean

market is currently mixed to lower.