30/10/2017 Business Briefing

Hello.

This is Business Briefing.

My name is Sally Bundock. Here are

the headlines:

President Trump leaves

markets on tenterhooks,

pledging to appoint the next

Federal Reserve chair this week.

We run you through

the main contenders.

And troubled Japanese steelmaker

Kobe withdraws its earnings

forecast, as the scandal

over its falsified data casts

uncertainty over the

company's results.

And on the markets stocks in Asia

are mixed amid a slew of big

corporate earnings and losses

on markets in China.

Plus political turmoil in Spain

weighs on the euro.

Good to have you with us. We start

with a woman I would like to

interview. It is Janet Yellen.

Janet Yellen's days as chair

of the Federal Reserve

could be numbered.

The chance that President Donald

Trump will reappoint her are looking

slim, and as Yellen's term ends

in February that means

the Commander-in-Chief is actively

looking for a replacement.

This is an important position

and a powerful economic appointee.

And it will also influence Mr

Trump's success at making his

super-charged economic

growth, a reality.

So who are the front runners?

Samira Hussain reports.

Don't expect presidential level

political campaigning. The decision

on who becomes the next chair of the

Fed rests solely in the hands of the

President. So who is in the running?

Usually the easiest and most desired

outcome from Wall Street is to

maintain the status quo. Here that

Ms Janet Yellen. But she has

disagree with the President in terms

of rolling back banking rules since

the financial crisis. Then there is

Gary Cohn, the head of the

President's economic council. He was

considered the favourite, but their

relationship went south, after he

disagreed with the President's

response to the violence in

Charlottesville. So who is left?

John Taylor. He is a Stanford

economist and always on the

republican list of potential Fages.

But never gets the job. -- Fed

chairs. He is a poor clippings that

interest rate should be lowered

despite inflation. Next is Jerome

Powell, a member of the Federal

board, and has expressed on the --

and has its roots in the private

sector. And then there is Kevin

Warsh. He has been on the Fed bought

for more than a decade, so knows the

gig. But he may want interest rates

go. And he was warned about

inflation. Whoever Rodez will have a

difficult job ahead steering away

from historically low interest

rates.

With me is Nandini Ramakrishnan,

Global Market Strategist at JP

Morgan Asset Management.

Good morning. Good to see you. So is

Samir Hussein was talking to some of

the candidates. There are few fair,

Powell, the continuity candidate,

then Taylor, who could be a little

bit more unpredictable.

Yes, there

is a difference between Powell

having experience and working with

the Taylor for several years, and

Taylor, who is eight professor who

invented the Taylor Rule, and

according to that rule, they should

be higher than where they are now.

This is a continuity candidate

versus somebody who is a little bit

mawkish. It is important to remember

that whoever is picked, they are

still working with a Fed that has

many participants and interest rates

will not change necessarily straight

after the appointment.

That is

right. There would be an immediate

shed. And over has the job will be

very conscious of the power they'd

have, because the wrong comment can

make markets go all over the place.

Yes, and as Janet Yellen has seen,

that press conference that has the

data come out is so important. The

way she says several words, phrases,

that is really watched by every pet

is a bit in the market around the

world.

From the point of view of

Janet Yellen, she is not out of the

frame completely, although most

believe she will not be appointed

for a second term. What do you think

about that? She did a decent job,

didn't she?

She has been the key

message person to get the markets in

the world to see the Fed moving from

low interest rates and no movement

towards pulling back, so higher

interest rates and the balance sheet

coming back to line. She steered the

Fed from accommodative to pulling

back a bit.

As it is the get any

news about who Donald Trump

nominates, we will update you. We

need to move on, now.

Troubled Japanese steelmaker

Kobe Steel reports earnings in just

under an hour's time.

And according to reports,

the firm will withdraw its earnings

forecast for the current year,

as it attempts to come to terms

with the cost of the recent

fake-data scandal.

Revelations of widespread tampering

of data has wiped a third off

the value off its shares

in the past three weeks.

Yuichiro Nakajima is Managing

Director, Crimson Phoenix Limited.

Thank you for being on the

programme. I guess no surprise. They

cannot give us a sense of what is

ahead, the best deal, because of the

challenges ahead.

No, there is too

much uncertainty. -- of what is

ahead, Kobe Steel, because of the.

The committee has been subpoenaed

with a request for information about

what it did and what it knew and

when. That could lead to a series of

lawsuits, or lead to just some

settlement or even nothing. So the

US is a big market for the company

and internationally the reputation

is going to be much affected by what

the Department of Justice says. So

it is not really possible for

analysts to come up with anything

like a reliable forecast for the

company's performance. And

management is also going to struggle

as well.

Can I ask you what the

outlook is like? I know you have

just said it is going to be hard to

say, but will we be talking about

them in years to come, or not,

giving the charges facing them?

--

given. Who could know. Many futures

are in question here, such as Takata

going under. Kobe Steel could suffer

the same fate, but it could get

government and private sector

support. It is just too hard to say.

We're just the beginning of the

whole process and nowhere near being

able to give an accurate forecast.

All right, Yuichiro Nakajima, thank

you for your time.

Now let's brief you some

other business stories.

Puerto Rico's Power Authority has

cancelled a controversial contract

to rebuild the US

territory's power grid.

The $300 million contract had

been handed to a small

Montana-based company,

without open bidding -

a move that created uproar.

Whitefish Energy had only two

full-time staff when it won

the massive deal.

PetroChina is due to report

third-quarter earnings

later on Monday.

The Chinese state-owned energy

company has lost $800 billion

in market value since it first

started trading 10 years ago.

It's been hit by a huge decline

in the price of oil over the past

decade, and a shift

in China's economic policies.

And the owner of bankrupt airline

Monarch has promised to repay

British taxpayers if it

profits from any sale

of the company's assets.

Investor Greybull Capital says it

has a "moral obligation"

to reimburse the government,

which spent nearly $80 million

bringing passengers home

after the UK's fifth biggest

airline went bust.

We have mentioned that it is a big

day for corporate news.

HSBC, Europe's largest

bank by assets has just

released its latest

financial numbers.

Our Asia Business Correspondent

Karishma Vaswani is following

the story in Singapore.

Nice to see you. What do the numbers

look like? At a good, bad, or ugly?

On the service, a 446% jump in

pre-tax profits looks pretty

spectacular. And that is if you look

at the numbers that HSBC has put

out. That is up from $843 million in

the fourth quarter of 2016. We need

to put these figures into context.

This is coming off a low base in the

same period last year. At the time,

he BC lost almost $2 billion from

the sale of its Brazilian unit.

There was also a fair amount of

volatility in foreign currency

movements. This time around, the

chief executive, Stuart Gulliver, as

the two did its performance to the

banks' pivot to Asia. This has been

happening for some time. -- bank's.

At least half of the cabby's profits

are due to Asia. But since the

financial crisis, they have been

cutting jobs to make the company

more profitable, while making

dividend payments to shareholders.

The bank's continued bet on Asia,

according to analysts, is why they

have been continuing to get results.

Thank you so much for joining us.

But let's look at what is trending,

now, in business, today.

The Guardian says the UK

could undergo a fourth

industrial revolution.

A post-brexit phenomenon that

could add £445 billion

to the economy.

And billionaires love

buying sports teams.

But apparently it's not just an ego

boost, it's actually

good for business.

That story on Business Insider.

And Apple is taking product

leaks very seriously.

Marketwatch reports that an engineer

was fired after his daughter

uploaded a video of the new

iPhone X to YouTube.

And don't forget -

let's us know what you are spotting

online - use the hashtag

#bbcthebriefing.

Let's have a quick look at the

markets.

That's it for Business

Briefing this hour.

Come out next, we will have a take

on some of the news stories around

the world.