Transcripts For BLOOMBERG Countdown 20240622

Oil on the decline. Welcome to the program. The extended version of countdown as the euro hangs in the balance. Iamb anna edwards. I i am anna edwards. I am Ryan Chilcote. We start with the equity markets. This is where we are. This is where the euro is trading. I have context and show you that we are up of the levels we were trading at. So, if you are looking for chaos, it is not evident right now. The euroyen slipped. It did not raise the gains on friday. We are not seeing anything that looks like panic right now. How are equity markets digesting the latest . Were seeing things move higher and plenty of others around china that we need to get to and it moves things around. That is the picture across european currency markets. Lets talk about the latest. The emergency summit has failed to secure the future of greece and the talks continued throughout the night. A Sticking Point is a proposal to put assets into privatization. Lets go to who had been up all night. Good morning to you. You are at the seed of all the action this weekend. This is being described as a dealbreaker by the greeks. Update us on what the creditors are asking for here. Yes, indeed, the asset fund is called a dealbreaker by greek officials and these demands span Energy Markets to Financial Markets. A list of demands, including cutting pensions. We knew that. It included the Asset Privatization fund. A lot of the ground mentioned is from previous bailouts that they had not yet implemented. They are harsher demands and what leaders have been discussing. They are into the 14th hour of talks. With heard that the end is approaching. We heard that the end is approaching. This is a new third a lot. New third bailout. Run us through the demands. They include things that have been asked before and new demands. For example, giving access to government ministers and a veto. The fund and getting tsipras to fire workers. These are harsher because they include the mans and, overall look worse than what have been asked for previously. This is about creditors losing trust. Merkel said that the biggest currency lost is trust and reliability and they are not sure that they are going to act on what was said. They talk about size, scope, and ask for them to be implemented and enacted into law before the a lot is given. The bailout is given. What is the likelihood of making headway to get the demands approved . Ryan a good question and the answer is not clear. They say that they support cutting and raising taxes. That was an in theory discussion. They would have to turn that into law. In addition, the creditors are asking for the government to roll back the initiatives they have formed into law without creditors support since they came into power. The idea of spending cuts should greece meet the targets miss the targets. The fund would be collateral if greece did not pay the euros talked about being borrowed. The family jewels would be sold off. Some of it would be palatable to the parliament. If it is, it would require tsipras to reinvent. What is being discussed in brussels goes too far. Anna where does this put the Banking Sector. The banks remain closed. Ryan it is the third week of capital controls and the third week that greece is entering into without working banks. I was at cash machines and people are queuing up. Many of them are standing in line to get 50 euros. This country has run out of thank you notes. Of bank notes. The concern motivates those in the que queues is what happens when the money runs out. The people who are getting their money out, they need it to cover the daytoday cost. Some are pulling out as much as they can on a daily asis. Basis. They are coming, day in and day out. They could recapitalize the banks and some money would come immediately. The people standing in line, the concern is that there would be a bailin and they would be asked to pony up cash and there would be a raid on savings. That has choked commerce. Anna is grexist still in the cards . What is the latest . As always, anything is possible and the contained reactions in the market give you a clue about what the investors think. In terms of that, you have the idea of greece leaving the euro. You have the proposal and the demand and there was mention of a possible timeout for greece. We do not know who was going to make it into the final document. In terms of a grexit, a number of people have been opposed to this. The maltese Prime Minister says that the meeting was canceled and they would have been talking about how to manage a grexit. You can assume that means that it is not in the cards. Of course, everything is played for at this stage. Another important milestone is july 20. They have to make a repayment to the ecb. If they failed to make the payment, they could stop supporting the banks. What were hearing is that the creditors are trying to find a way to find a bridge financing for greece. That does not seem like efforts are being made to avoid the scenario. Anna thank you. Ryan chilcote in the ground on the ground in athens. We are bringing you the extra hour of coverage. We will speak to a greek out of brussels and we will head to berlin with the president. There is plenty more coming up. Lets just get to an expert voice. Good morning to you. It is an early start for everybody this morning. He was saying that there was a chance of a grexit. I am not sure that numbers are useful. You might as well say that we do not know the caret was dangled of temporary exit in return dffor debt restructuring outside of the euro. The greeks have clearly not gone for that one. Now, everybody is scrabbling around. There is a desire for greece to stay in, just about. Even if we get through even if we get through the next three days, the thing that is clear is that the story is not going away anytime soon. Anna what is the deadline for you . 72 hours from now . July . It would be incredible for them to get the money together for the payment. I still do not think that the ecb, the European Central bank will pull the plug without political cover. They want to be Civil Servants in the process, as opposed to political. These are going to feel like a slap in the face for the Greek Parliament, in terms of the things that you have to do to get over the first stage of the deal. And then, rebuilding trust in terms of their ability to deliver on the package and the economics of having this much austerity without needing an upward revision down the road. The economy is bleeding away. That is how it might feel. This is paul krugman, a famous economist who is no fan of austerity measures speaking out against the betrayal of everything the year p. M. Project was supposed the european project was supposed to represent. How does thisisacoup put into perspective what we have seen with the germans . It is the baltic bloc and there is emotion going through it. There is a reality that when an economy is in this much trouble, layering on more austerity is difficult to manage. Equally, finland is a good example. With the austerity they came through in the past you can sort the economic crisis out and you can sort it out more easily. The problem is that i would not want to start a massive project. That is where the trust is lost. The whole structure of latin countries of letting countries build up debt and not being able to print money, it was a structural flaw in the system. Thank you. If you would like to join the conversation the hashtag has been thisisacoup. What do you think . Do you think the creditors are quite reasonable . It is quarter past 7 00 in athens. Still to come, the laundry list for tsipras his longer. Will he enact the demands . Will get the reaction. A nuclear we will get the reaction. A new year deal a nuclear deal could be announced as soon as today. We have pictures coming in from athens as we are waking up to the latest. Anna welcome back. We are 20 minutes past 6 00 in brussels. Here are the stories you need to know. The european leaders are giving greeces Prime Minister a choice. Tsipras was handed a list of cuts that he must enact. They want tsipras to move ahead with assets and fire workers as a condition of restarting talks. Overseas shipments rose from a year earlier and today is fresh evidence that the growth is stabilizing. Iran and World Leaders may be close to reaching a nuclear deal as soon as today. One of those was resolved on sunday. A diplomat says that an agreement was reached. John kerry had a working dinner with france, germany, and russia. Now, lets get more from greece. He is with us now. She is any economist an economist. She joins us to make sense of russells and what it means. We have to start with how tsipr as goes against austerity and could bring back a deal that is more austere than he was facing before he introduced the referendum. Casnnhe he do that . He sees that brinksmanship is at the cost of capitulation. He will have to find sweeteners. We have not seen the deal yet. We hope it is enough for him to sell it and it will involve a reference to debt relief and some sort of reference to a growth in investment package. It is arty in disarray. The domestic audience is half old by the referendum baffled by the referendum. Ryan can he sell the deal . We had a vote where the parliamentarians supported some of the measures. Can he do it here . He has a National Consensus for the first time and there was a strong majority. We should expect the majority should follow through and help pass through the prior actions that are considered necessary for the negotiations to begin. Ryan an idea was raising sales tax and broadening the base or cutting pensions. Some of it is setting up a fund to turn assets into collateral. They were not being talked about when the parliamentarians gathered on saturday. Why is this fund so unattractive back here at home . It is the government under custody for state assets. For the creditors, they are upset at any sort of debt relief. There are problems. The privatization record was poor and greece will have to step up. However, this idea is humiliating because it suggests the greece cannot greeks cannot do it on their own. Ryan if the Prime Minister gets the deal through, what is the downside . He may have to give away a part of his party. People have registered disagreements. Disagreements. It is subtle today. May be this morning. Also maybe this morning. We may see a to government emerging. May see a Coalition Government emerging. Ryan what does this mean for the banks . They want to open as soon as possible. They cannot make any meaningful decisions right now. The sooner there is a deal the easier it is for the ecb two afford protections for the Banking System and making a move. Ryan thank you. Joining us with one of the better and brighter minds in athens to help us sort through a situation. Anna you dont think they are going to pull the plug without political cover. Absolutely. If they did, it would worry markets. We wait for politicians to make decisions and we understand how the Financial System works. Anna thank you. Kit juckes stays with us. Well talk about iran could be on the brink of a deal. We will look at the negotiations needed and we understand the deal could come as soon as today. We will bring you uptodate with the latest news surrounding the talks with iranians an global powers. Anna countdown welcome back. You are watching, 5 30, or if you are watching in brussels 6 30. Strict principles or quitting the euro. Alexis tsipras was handed a list of economical forms that he must enact by wednesdays deadline. Euro area leaders want to raise taxes, cut pensions with talks over as much as 86 billion euros. It ran an world powers may be close to reaching a nuclear deal, and it could be announced as soon as today. One of the provisions among the negotiations was resolved on sunday. They say an agreement was reached to left a United Nations arms embargo, and secretary of state john kerry at a working dinner with ministers including france, germany, and russia. Chinese imports are up for the first time in every are months, rising from one year earlier. This is fresh evidence that chinese growth is stabilizing. China will release gdp figures on wednesday. Now, lets get more on where the equity markets are trading this morning. Lets go to juliet in hong kong. A number of matters here. The greek story, of course, one of them, but away from that, more equities are trading in china. Gradually, some are coming back to the markets. Reporter yes, good morning. We have got about 36 of the equity market on the shanghai composite still frozen, but certainly a lot more trading than what we saw last week, one of the efforts by authorities to stem the equity route that we had seen coming through, and then on thursday and friday. We had solid buying. This was again to kick start the week. Of course, there are hopes there will be a greek deal, and also chinese trade data out today also helping things along. We have the shanghai market currently on a lunch break, but it was up heading into the break, as is the hong kong hang seng index up, and we are currently seeing some bargain hunters moving in and picking up some of these things that were heavily sold off, and in japan the nikkei trading quite well up, a bit of weakness coming through from oil players there, and a similar story in australia but elsewhere, we are seeing quite a bit of buying. And they are supporting the asx 200, currently up by about three quarters of 1 . If we just go back to the main story of china and, of course hong kong, there is some bearish outlooks. Mark mobius saying to bloomberg that he still thinks chinese equities are too expensive. It certainly does not appear to be hurting sentiment at the moment because we are seeing some good buying, once again, in the asian region. Anna and the latest redevelopment sprint talk to us about china. The chinese export numbers up for the first time in four months. Is this a sign that the chinese growth is stabilizing, or is it too early to be saying . Report what we are encouraging is that we have seen some encouraging data coming through out of china. Certainly the export story looks white positive, and also domestic imports looking good for china, as well. We had the chinese customs spokesperson say he believes the china trade will improve if there are no great conflicts around the world and worse the greek story may put a bit of a dent in that, but we do not have an idea of the impact in greece on the trade in china. And a recovery in the second half, big trading partners like australia, as well, and this was one piece of bright news that we really needed to see to kickstart the equity market. We will see when china comes back online in about half an hours time, a definitely some solid stuff coming through. Anna thank you, from hong kong. Lets get to another geopolitical story we are following this morning, i ran and world powers he ran iran iran and world powers. Is it for real this time . Elliott on an almost daily basis these past 16 days with officials and the members of their entourage have been telling reporters that a deal is closed. This time, the language seems to have ramped up a little. Talking about a deal being almost complete. Now, one of the stumbling blocks was the question of the arms and bargo which has been placed on iran since 2000 seven. It seems they have resolved that issue that the arms embargo on iran will be lifted, and they are drifting an issue. It was very much backed by the russians. And the lang which we are getting from some of the big layers in the and a and involved in the talks is also promising. We have heard from secretary of state john kerry saying that he remains hopeful, and they said there were a few steps left in order to seal a deal. Anna and we need to remember that if there is a deal reached it still has to be approved in washington. Elliott yes, to go so far as saying that the real work begins once this deal is done in vienna. Any to go to another venerable building and to congress in the United States, and some of the signs coming out from washington are not usually optimistic. We have heard from john boehner, suggesting that the deal somehow means that the u. S. Has backed away from some of the tenants of the framework deal reached back in april. Senate Majority Leader Mitch Mcconnell said there is a very hard sell needed to get this through congress, so the optimism that we are seeing in vienna, which is translated into the markets, oil prices declining in the hopes that was the deal is done, iranian oil will be on the market again this may be an issue if congressman kill the deal. Anna Elliott Gotkine with the latest. And we have seen this extending the recent gains after last week. We have seen the biggest weekly fall since march, so at nymex, 58. Brent crude. Out of those below the 60 mark. Of course, the broader picture is that it has been rebounding from both sixyear lows. But it seems that the prospect of more iranian oil being brought back into the international full, that has a downward pressure on oil prices. And it is looking fairly positive as they are not really responding in a risk off way to what we have seen coming out of brussels, an extension of the negotiations at least until wednesday, and it may be a positive. There is now 72 hours or less than that for the greeks to pass legislation, it seems. With that in mind, lets have a look at what is happening on the Foreign Exchange markets. Again, no signs of panic in the market this morning, and the eurozone is trading actually higher than the level it was trading out on june 29 and on june 30, indeed, when we saw the greek missing their payment to the imf. That is just a broader contexts, and even euro yen not seeing much stress. We often see that moving as a result of tensions in the market and risk appetite. Now, lets stay with greece. With the unemployment at about 50 , hundreds of thousands of young, educated greeks are flooding out of the country. They are speaking to students about the brain drain in greece. A great number of young people are going abroad at the moment, because there is no kind of future here in greece. The unemployment and the percentage of unemployment is growing really, really every day. Really anxious and stressed about what will come after my finishing this year in greece. I will try to do my best so i can have better chances in order to find a better job, and then you have to make a living. I mean, you have to live. This means that all of the good brains of greece are going abroad, and companies, for them, it is good has they are going to take the best minds. They are going to just employ them, and then they are going to use them so they can make a bigger amount of money you know, but for us here in greece, who is going tuesday . I am not going to say it is the doma is the dumb or the idiots that will be here, the dumb or the idiots that will stay here. I hope in the next years, they will come back, and they will help their country. I dont know. We will see. It is disappointing, but still we will figure it out. Anna student voices there in athens. Lets get back to kit juckes. Tragic accounts coming from athens, and that is no exception. Of course, you have been talking about how the Greek Economy is shrinking all of this time. The Greek Economy is shrinking, and the debts are still there, arent they . Kit you need gdp to grow and gdp growing when the number of people who are working is going down, the number of people in the country is going down, is just nylon in possible. Nigh on impossible. Greece needs to offer greek people or anybody a future working in greece, or this crisis will just roll on. Anna migration has been an issue, hasnt it . Going back to 2008, talking about the brain drain from the Baltic States i remember from the financial crisis. It has helped been happened everywhere. Kit people can move more easily now than they did 10, 40, 50 years ago. We not only move jobs from one country, but people. People speaking english, having similar skills, and we have education that moves around. And the people go looking for where the jobs are, leaving not a lot behindkit people can move more easily now than they did 10, 40, 50 years ago. And that leaves Foreign Countries with huge debt, and if you raise tax levels, tax rates to try to tackle it, why would i stay somewhere and pay more tax . Anna what about the creditor institutions . Do you think they are in line . More about reporting around this, the germans and french are not necessarily on the same page. I understand the german finance minister even snapped at mario draghi over some of these conversations. Does that matter to you that some of these are not on the same page, or is that healthy to you . Kit it does not matter too much. It was a structural flaw that everyone knew was in it. The Currency Unions one on one these large deficits the large autonomy over fiscal policy without any independent monetary policy, it was kind of Milton Friedman wrote about this before it started as it being a flaw and this plays out, because the rules were there to cope with a design flaw, and when that is not working, it ends up with National Stereotypes bumping into each other, but National Stereotypes dont matter as much as what are we going to do about the fact that the structural flaw at the heart of this is now showing itself . Anna the optimist might say that the eurozone emerges from this stronger, and we know more about how the eurozone unctions and the rules of engagement around the eurozone, and missing rules are written. Too optimistic a view . Kit possibly, but you can still control taxes and have large debt levels, but now we are not going to assume the principle of some form of debt relief within the single currency area, and you get bailed out by perhaps smaller countries with lower gdp per capita. I think those faultlines will be really hard to play out. It will take years, not months. It is a fork in the road, where you decide what kind of Currency Union this is going to be. The super optimist would say we are going to get to a slightly better run fiscal policy, more fiscal union, and maybe the natural divisions are just showing. Anna is this an offer that the greeks can accept or not . To talk to all politically . Kit there are lots of people who think this is an offer that isnt encouraging them to head towards the cliffs. I think this is probably the best offer that they feel that they can have to meet the two sides of this debate in brussels at the moment, so it is a compromise, as is Everything Else that comes out. Anna kit thanks. Kit juckes. annanews is where you will find me, and you will find him if you want to get in touch with him, as well, and with the trending hash tag, this is a coup. This in response to the demands they are making and the oversight they are insisting upon about the Greek Economy. Let us know what you think by sending us your thoughts on twitter. Coming up on countdown greece has until wednesday to enact a string of reforms or phase euro suspension. We will bring you more on those conversations that are still ongoing in brussels and we will have the latest conversation out of assets, and we will be joined by the estonian Prime Minister. That is coming up during programming today. That is the first interview today, 8 30 u. K. Time, and the baltic countries have a lot to say about this, many speaking out on this. Here is a live shot of athens. We will be back. Anna welcome back. You are watching countdown, 5 49. Giving greece a choice, or quit the euro. An emergency summit in brussels. Alexis tsipras was handed a number of reforms that he must enact by wednesday, and they want him to cut taxes cut pensions and raise taxes. Chinas june exports are up. Overseas shipments rose from one year earlier. Fresh evidence that chinese growth is stabilizing. China will release gdp numbers on wednesday. The ran an world powers may be close to reaching a nuclear deal, and it could be announced before today. One of the biggest divisions among negotiations was resolved on sunday. A senior diplomat said a political agreement was reached to lift a United Nations arms embargo. Last night, secretary of state john kerry had a working dinner with members from france germany, and russia. Euro leaders specifically have taken a break from emergency talks ahead of final consultations on greece. Lets get to our team of reporters, who have been up all night following this story. Ryan chilcote joins us. And our reporter a very long time, what is Holding Things up . Reporter yes, i tell you, i have been to a lot of these meetings in brussels, and i think this one is reaching a record. We are approaching the 15th hour of talks, eu leaders talking about over these demands that the eurozone finance ministers put forward to greece. Why it is taking so long is that these demands are harsher than anything we have seen before, including everything from labor market reforms to Financial Market reforms to Energy Market reforms, and the one thing that we are told is the Sticking Point now, the dealbreaker, if you like is the creditors asking greece to transfer as much as 50 billion euros of state assets into an independent luxembourgbased company for sale. It is a privatization font, in other words, and this is what we are being told is currently the Sticking Point, so talks are ongoing. We have even been told that Alexis Tsipras had stepped out to make calls to colleagues in greece, but they are still ongoing, in we are still waiting. Anna the clock is ticking. Ryan yes, one way to interpret the results of the referendum is that he has a mandate to do a deal. We have to look at the specific things creditors are looking for. Over the weekend, 200 51 of the members in the Greek Parliament did effectively, in eerie, give him a yes, we will be on board with that. They did not turn that into law. They did not vote on it. But they did say they would be willing to support that. The issue, if there is going to be one, is with members of his own party and specifically with the three additional measures at the creditors seem to be asking for. One was this idea that the ruling party would have to rollback all of the initiatives that it has engaged in since it into power, and another would be the idea of automatic spending cuts it greece did not make it targets. The 50 billion euro fund that greece would have to set up effectively being prepared to sell its government assets liquidate government assets, privatize them should it not be a look to repay some of the 86 billion euros it is looking to borrow from the eurogroup so it would not be easy. It would require some kind of political realignment, but he might be able to do it. Anna still on life support from the ecb . Ryan well, look. The banks remain closed. We are in week three of capital controls, and there is no particular side that banks will open. There is an understanding that perhaps the government is going to extend capital controls. I actually went to one of the cashman seems cash machines overnight. Have a look. Atm machines and the lines outside of them are a good idea plays. There are about 15 people outside here, and you get the sense that they are pretty comfortable with what is maybe the new normal standing in line to get their money out of the bag. How do they feel . Lets go and ask them. Hello, maam. How long do you think you are going to have to stand here in line to get your money . A quarter of an hour. Ryan and how much money will you get . 50 euros. Ryan even though 60 euros is the cap . There is a problem with smaller notes. How concerned are you about greeces future this week . Some are saying the banks will be closed for days, and some say weeks, maybe months. Are you worried . A little, yes. It depends on schauble. Ryan it gives you a sense of their role in all of this. Back to you. Anna from brussels, and a final word from kit juckes. We are not moving very far with euro dollar. Are you surprised . Kit we had a shot around 110 and then we bounced back up. The new normal in athens if it is standing in line for a 50 euro note from the cash machine, then it 115 on the euro dollar waiting for some into actually happened anna kit juckes there. We will be back. We will continue digesting this greek story. Stay with us. Europes leaders demand greases Prime Ministers initiate new reforms or leave the euro. Alexis tsipras is faced with a new deadline of wednesday. The euro drops, but showing some resilience, trading 1. 11 against the dollar. Anna 400 companies resume trading while the june exports beat estimates. And a Nuclear Accord on a ran could be announced on iran could be announced as soon as wednesday. Welcome to countdown. I am Ryan Chilcote in athens. Anna and im anna edwards in london. We have been on there for the last hour and we havent seen that much move. It could be something of a relief for nervous investors. Lets get straight to whats happening on the Foreign Exchange markets. I have a onemonth chart to give you perspective we are still above 1. 11. The euro is currently trading above levels we saw on the 29th of june when the greeks missed the payment. In the euroyen, which typically does express some level of risk aversion when we see these diplomatic standoffs, we arent even seeing much of a slip. We havent lost all of those gains made on friday. We seem to be in limbo right now. We are waiting to see if the greeks make any progress over the next 72 hours. They will have to enact reforms before they get anymore funds. Alexis tsipras as until wednesday to enact creditors policy demands, including slashing pensions and raising sales taxes in his home country, or the alternative is to quit the euro. There was an emergency summit in brussels that continued into the early hours of the morning. Lets get straight to our correspondent, live on the ground. Ryan chilcote joins us live. You have been up all night in brussels creditors have been demanding that an asset fund is set up. It is being described by some greeks as a dealbreaker. It seems that this is where some of the tensions exist in negotiations right now bring us up to speed. That is what we are hearing that this is the main Sticking Point, the dealbreaker, according to one greek official. What we are talking about here is a demand from finance ministers that greece transfer as much as 60 billion euros of state assets to an independent luxembourgbased company for sale it is a privatization fund, and other words, and this is where the Sticking Point is. These talks are now reaching a record we are into our 15th hour, still no resolution in sight. We have even heard that Alexis Tsipras has stepped out of the room to talk to colleagues back in greece. What we have seen from eurozone finance ministers is a demand harsher than what they have seen before. They include reforms to be made to markets everything from labor markets to Financial Markets to Energy Markets, and it really is a bit of an ultimatum for greece at this point, a bit of a take it or leave it scenario. At the moment, the ball is in greeces court to see if they will be able to move forward. Anna are the demands the creditors are making are they being deemed by commentators as too harsh, are necessary to enable or necessary to enable trust . Nejra that is an interesting question anna because we have seen paul krugman say that these demands from the creditors are madness. A former advisor to john Yanis Varoufakis, that advisor said that these are punitive to the point of almost impossible. But the argument is that you could say that the greeks have in pushing their luck up till now. They had the referendum where the austerity was rejected, only been to have those reforms passed in parliament. Costume he we have seen deadlines pass us the big question as to whether they are too harsh is going to be answered by greek lawmakers. What the demand stipulates is that these demands have to be put into law within three days by july 15 in order to get this bailout. They are harsher than before, but we really are reaching an endgame now with the situation. It is either enact these reforms are you could face a grexit. Anna ryan, lets come to you. The creditors, it seems, simply dont trust the great government and they want them to act before they get anymore money what is the likelihood that tsipras will be able to get that enacted by wednesday . Ryan it is a bit of a copout to say, but the answer is possibly. You have to think about it one way to interpret the referendum that this country had is that it gave the Prime Minister a mandate to do a deal in brussels. That is one interpretation. Another thing to keep in mind is that Greek Parliamentarians in theory, said they would support the idea of raising taxes and cutting pensions. That has yet to because im. Yet to be codified. It would happen within series the Prime Ministers own party, and it is going to deal with some of the new things the creditors are asking for. Namely, they are asking that the ruling government roll back some of the initiatives that it introduced that didnt have the blessing of creditors. Another thing the germans are looking for the idea of an insurance policy to make sure that they get the greeks to do what they want. If greece doesnt mean its budget target, then spending cuts would automatically be triggered. That is another potential Sticking Point. Finally, there is this issue of that 50 billion euro fund that would sit and luxembourg what wouldich would be privatized. All this could be a tough sale, but it might be doable. One thing it would almost certainly require would be for Alexis Tsipras to reinvent itself. He would have to be a slightly different politician, because in order to win over some of the opposition he is probably going to have to expand some of the support within his own party. That could mean a government reshuffle. Anna ryan, where does all of at least the banks . As we saw in the lostast hour, the quese are sti the queues are still there. Ryan the country and its cash for sheehan are running out of some of those smaller denomination of euro notes. The reason people are lining up at the cash machines is not just because they need the money to cover their costs, but they are concerned there will be a bail in. The issue with the banks is that they need to be recapitalized part of this 86 billion euros that the eurogroup is looking at lending, that is between 10 billion and 25 billion and that would go to recapitalize the banks. I was talking to a member of the political opposition earlier in the day, and he was saying, even if there is a deal in brussels although certainly the banks we are talking about days or weeks, he is saying that could go on for months because there is trouble with increases bank within greeces bank. It means at some point they could be reopening but it would be after restructuring. Anna is greg sit still in the cards after all these hours is grexit still in the cards after all these hours of debate . They could still in the future. Nejra yeah, it certainly is one of the possibilities. Either we get a deal or we could see greece move toward a grexit. One things for sure is that this is the closest that greece has ever been to exiting the eurozone. What we were hearing earlier this morning, last night rather from the germans, is that they want to degrees to almost temporarily leave the euro zone for five years this is something that didnt come up in that document from eurozone finance ministers, referred to as a timeout. We dont yet know if this will end up in the final document or how far it has been discussed, but obviously it is a possibility. The other thing to bear in mind is that greece has to make a repayment to the ecb three point 5 billion euros on july 20. Where it were to miss if it were to miss that payment there is a chance the ecb could stop providing emergency funding. That is when you could see a parallel currency emerge, which is the first step to a grexit. It is highstakes year, very highstakes. The latest weve heard, again for the fourth time, Alexis Tsipras has gone into a meeting with Francois Hollande donald tusk, and Angela Merkel. It doesnt look like we are any closer to a resolution the meeting is still going into it 60 in our now. Its 16th our now. Anna thank you very much. It is 11 minutes past 6 00 in london. We will bring you all the latest updates throughout the morning. You can join in the conversation on twitter. The hashtag thisisacoup is trending tonight. It is critical of the demands creditors have demanded. Do you think this is a coup . Do you think what is being demanded is unreasonable . Paul krugman, not a fan of imf or austerity, and it seems he is not impressed by what the creditors are demanding. Before all that though, we will have insight on the greek story from plenty of other angles throughout today. We will be speaking to a greek mp, and we will head to berlin with an interview to berlin for an interview. We will also hear about banking and investment sectors from the managing director and later on, we will be hearing the Prime Minister of estonia. He was at the negotiating table on sunday. That is coming up. You will have real insight from inside the room where all these discussions are taking place in brussels. It seems that the baltic countries have a lot to say. Lets turn from greece to asia stocks rose as investors weigh the latest negotiations between european leaders and greece and some of the latest data. Sally joins us now from hong kong with more. Bring us uptodate. It seems we are not seeing that risk aversion trade coming through in any evidence. Juliette absolutely not. What the future for u. S. Markets are showing is more about china. We have seen some really positive trades out of china today. Still about 36 of the country is halted for trade, but as you mentioned, almost 400 are coming back online supporting the shanghai composite. It is a little bit higher on the hang seng index and we are seeing support coming through from healthcare stocks in australia, while japan is up by 1. 6 , coming back from that big selloff we saw at the end of last week when japans stock index i want to show you a couple stocks we are watching in china and on the hang seng index. It has had its biggest falls since 2008 today, coming through with a 2. 7 billion placement. That is one of eight shares that are down. Sm investments as asias largest Shopping Mall by market value. It has said that is equity isnt going to dampen Consumer Confidence in asia, we are still going to see people spending. Share prices are still going quite well in the philippines. On the shanghai composite, this is one of those stocks that has been doing well it is down 3. 5 . Hundsun is one of the companies that have been halted from trade. It came back on today and was rising 10 . Certainly, the focus here is on the positive trade out of china, the fact that we are still seeing investors thinking chinese equities are a little bit cheap, driving into a positive session. It is further away from whats happening in greece. Anna the shanghai composite is rising above the 4000 level in touch 4000 earlier this month. Give us a bit more detail on chinese export numbers are they telling us anything about the broader moves to try and stabilize growth of the chinese economy . Juliette authorities in china has been doing everything they can to stabilize the economy and this is one positive sign. We had exports looking strong for china, which is great news for trading partners and domestic imports. The chinese customs minister also came out with a pretty bullish outlook on commodities and trade within china, that it will help things kick along. He did mention that a big World Economic event whats happening in greece but certainly these numbers help sentiments in the asian region. The shanghai composite is up, and it certainly is pushing through and trying to get back through that level. Anna juliette, thank you. Coming up on countdown, iran almost comes to a deal. They could be announced as soon as today. Could this week marked the end of the sanctions scandal . Welcome back. 20 minutes past 6 00. Hearing the stories you need to know. European leaders have given greeces Prime Minister a stark choice ditches principles or quit the euro. At the emergency summit in brussels, Alexis Tsipras was handed a list of Economic Reforms that he must enact by wednesday. Euro area leaders want separate to sell state assets and cut workers in order to provide bailout funds. Chinas june exports are up for the first time in months. Overseas shipments rose 2. 1 from last year. It expresses evidence that chinese growth is stabilizing. There ran and iran and world powers may be close to reaching a nuclear deal that could be announced as soon as today. A senior diplomat said that a political agreement was reached. Last night, john kerry had a working dinner with Foreign Ministers from france, germany and russia. Elliott gotkine has more on the iranian story good to see you again. Theyve had a number of deadlines come and go with greece and with around. This time is it real . Elliott it certainly seems that way. Almost every day, diplomats, officials, and members of their entourage have been saying that we are close to a deal, that they would push the negotiators over the finishing line. The language seems to have changed, suggesting that a deal is almost complete. One of the biggest hurdles was the listing of the arms embargo on iran. Iran says it wants it to be lifted to help in the fight against the islamic state. A Un Security Council resolution is going to be drafted to outline exactly how the arms embargo will be listed against iran. We understand it would take place over a certain length of time. Certainly from some of the key players john kerry is saying that he remains hopeful that a deal can be done, and has some rouhani and Hassam Rouhani is saying there are just a few steps left. A lot of it is very legal, very technical. We certainly seem closer than ever to seeing a deal done. Anna elliott, thank you. Elliott gotkine there. Lets get back to china the benchmark index rose for a third day in todays session as more companies resume trading. 1045 Companies Remain suspended but that is down from 1453. Joining us now from hong kong is the head of china strategy. Thank you for joining us. It seems everyone is divided as to whether chinese equities are a goodbye because of the amount of selling weve seen or about to fall further. What do you think . Erwin i think they will be popping the champagne. 4000 points on the shanghai composite is the level they tried unsuccessfully to defendant two weeks ago. We just achieve that level again today. Above 4000, i do agree that things get a bit trickier. The main driver of the chinese equity run was broadbased credit easing to boost the economy and to support the Property Market. As weve seen in recent months it is now on the path to recovery, so we are turning down our expectations about further brought easing measures. We think about 4000 points on the index doesnt look that interesting to us. Anna you dont think the pboc is going to be issuing policy as much as they did before. So how much do you think the pboc will ease as we head toward the end of the year and the chinese try to shore up that growth target . Erwin well, Property Market recovery is becoming quite broad now. We are seeing recovery through tier one, tier two, tier three we are seeing property prices move up. We think there may be one more rate cut but that is not very exciting compared to the expectations that the market has a few months ago. The share index now is back into more comfortable territory, so some of the emergency measures weve seen will likely be scaled back. Anna so thats the message we are seeing how do you regard those measures that we saw introduced last week . The fact that anybody who had more than 5 of the stock was not able to sell them for a period of six months how does this reflect real issues toward value a real perspective on the chinese equity story . Or are we still in a slightly makebelieve world come here . Makebelieve world, here . Erwin we need to get back on the path toward structural reform and deregulation of the financial sector. I think what the authority ies have done was correct and so far they as they had to manage a lot but some of the measures they used go against the path the financial opening, and we have to get back onto that path by Fourth Quarter for this market to remain interested. Anna what is the key metric to watch for you, erwin, for the chinese economy right now . Erwin well, i have been monitoring where property prices are going. That is important because if we continue to see property prices moving up, we do have to consider the prospect of credit tightening. Probably not this year, but maybe sometime at the beginning of next year. Generally, if we are investing in the market, i think it is important to look for growth opportunities. Rather than buying a broader index, we would focus on do economy sectors internet, health care, the environment sector renewables and also selected cyclicals. The property sectors interesting. Anna thank you so much for joining us. 6 26 in london. Counterfeit countdown will be back in a couple minutes. More of the greek crisis when we come back. Anna a war welcome back to countdown. 6 30 here in london youre the stories you need to know. European leaders have given the greek Prime Minister a stark choice ditch principles or ditch the euro. At an emergency meeting, Alexis Tsipras was handed a list of Economic Reforms, including tax hikes and pension cuts. Euro area leaders also on citrus to move ahead with also want to sipras to start talks over bailout funds. Chinas june exports are up for the first time in four months. Overseas shipments rose 2. 1 . This is fresh evidence that chinese growth is stabilizing. Iran may be close to reaching an nuclear deal, and it could be announced as soon as today. One of the biggest decisions was resolved on sunday. A senior diplomat said a political agreement was reached on the arms embargo. John kerry had a working dinner with the Foreign Ministers from france germany, and russia. Lets have a look at how the markets are performing. We start with a look at the Foreign Exchange markets. You might have thought that with all the weekend news 72 hours for comply to the greeks, that we would be seeing a crisis. It doesnt seem to be that way. We are above 1. 11 on the eurodollar. Those games that were made on friday are still almost intact. It sounds like the equity market session is not seeing a great deal of attention expressed around the great story. The asian equity market is responding to other drivers, perhaps even picking up on the optimism pervading the european and u. S. Sessions on friday that was a very different picture we saw, a strong picture, and that maybe affected asia and the chinese export data we referenced. We are seeing quite a positive picture for the asian equity session. That is the state of play in the market. Heres a look at the david to out the rest of this week. It is a busy week retail sales out in the United States then we stick with china on wednesday because we will get gdp figures. That will put the first half of the year in perspective how successful are those pboc measures in trying to shore up growth for the economy . Then on thursday we get an ecb Interest Rate decision and janet yellen will be speaking in the u. S. Lots to look out for as we go through this week. Lets come back to the present though, and talk about the greek crisis. Joining us now is the ceo of Hermes Investment management good morning. Welcome to the program. Give us your digesting of the news flow that we have seen over the weekend. I went to bed thinking that they must have come to an answer by 1 00 and in the morning they havent. There were some rumors that the germans were talking about a grexit. That is extraordinary because that is saying that the euro is not an Exchange Rate mechanism. If you look at the deal they are trying to make, there is a little bit of anger because tsipras came in from an election. They are saying that we are going to take your assets and privatize it. I have seen the news coming in from a company on the border an issue of governorship but they are saying that we will ask you to fire the people that you rehired, and there is no such thing as local national sovereignty. Parliament will have to pass these laws by wednesday or you have no deal, and we are going to put the imf in to make sure you comply with legislation this is pretty harsh. Anna thisisacoup is what is trending but that is perhaps only one side of the story. Saker i think it is a little bit too harsh. Everybody recognizes that the market has to be restructured. I understand that the northern parts were annoyed that tsipras wanted a popular mandate. But this is thought tension at the heart of europe. This has always been attention. Im surprised about the currency the currency markets are assuming that they will get the deal, that it will capitulate and greece will have to prepare for more misery. But to my mind, the fact that they are thinking of this as an Exchange Rate mechanism. That is not good news for the longterm health of europe. Anna i received an email from an analyst. He was talking about some of the Historical Perspective that he sees here. He was going back to versailles the level of punishment that was meted out to the germans after the first world war, warning against pushing the greeks too far. Is that historical comparison helpful . There have been so many historical comparisons made. Saker this is designed to humiliate the greek people and the government. There is an element where the germans are venting their anger. But then, this is between local democracy and the central mechanism of the eu. At the end of it the germans who owned most of the money here, are destined for a haircut, and if they push too much, they might get away with it for now, but the tensions within the euro not just within the euro bloc but within the euro as a currency anna tsipras wanted to have some sort of a, and expression of democracy, but we are seeing people in other parts of europe talking about whether they will approve whatever deal is on the table. We are talking about 80 billion euros at the moment. It may grow. If you apply the capital to that half of them going to the people saying they are off the hook you can see why that is a hard sell in parts of the baltics where they have undergone a great deal of austerity. Saker of course you can, and you can see why the german people who are already on the hook want to make sure they are getting their money back. But to be within parameters. But to think of it this way in spain there is a growing movement against the euro bloc because this tension with local democracy is what might happen as a result of this, these movements gather momentum over time. It has to assume that you cannot ever break it. The idea of a temporary grexit is extraordinary. A grexit should not be on the table. If california gets into trouble as a state you never assume they will print their own dollar. It is telling us that we dont think of the euro in quite the same way anna one idea was that nobody could ever leaves, you cant leave the euro. The other idea was that this is a rulesbased body. It seems that the latter has taken precedence. Saker it has, and there has been a shift. You have local currencies going through a bunch of rules and i dont think the market has quite applied that. What we are seeing is that the crisis has been averted, that for the time being, the crisis is averted, this will be to find degrees, the greek corner in that huge the money is big but its not that big. Anna thank you. Stay with us a bit longer. The greek government surprised many when it said yes late last thursday to most of the demands that the creditors had previously been making. Tsipras gays in days after a majority voted against further austerity in an historic referendum. Here is how no voters in athens have been reacting. I feel like this is a tough decision on tsipras but i hope that he will try to do the best for the greek people, and europe in general. Do you think the voters feel the trade . Not at all, not the trade. Not betrayed. What we expected him to do was go against the austerity measures, which had been proposed by the eu. We need something new we want something that might give us a new perspective. Because we voted no, the majority of greek people, the people in the government were going through negotiations with the creditors and a more optimistic way. But Something Like this i feel a little sad about it. Whitey think tsipras has changed so quickly . I dont think that hes changed. I think you cant do anything else. Anna if you are on the ground in athens, we will bring you uptodate throughout the morning. You can join us on twitter. The hashtag thisisacoup seems to encapsulate one argument do you think that is the whole story . We will delve into this in a little while. As we had to break, time is taking for the new greek law demanded by creditors, but can they meet the deadline . And what will it mean for greeces future in the euro . We will discuss it with a member of the Greek Parliament. Anna welcome back to count down. Here are the stories you need to know. European leaders have given the greek Prime Minister a choice that your principles are quite the euro. At the emergency summit in brussels, Alexis Tsipras was handed a list of Economic Reforms that he must enact by wednesday. Euro area leaders also want tsipras to move ahead with a plan to sell 50 billion euros worth of state assets. They are restarting talks over bailout funds. Chinas june exports are up for the first time in four months. Overseas shipments grew 2. 1 from last year. It is evidence that the chinese growth is stabilizing. Nintendos president , satoru iwata has died at 55. He led the company in the early 2000s with the wii games console. He founded the company in the late 19th century and helped triple revenue after taking the helm in 2002. Lets get back to our top story the fate of greece. The fate is now in the hands of lawmakers tasked with enacting creditors demands. Lets get the view from one lawmaker a member of the European Parliament for greece. He joins us now from brussels. Thank you very much for joining us. You are there in brussels this is where the talks are taking place. How do you think this will end today . Do you think we will get any kind of agreement between the two sides . Yes, i believe we are going to have a rather happy end in the sense that greece needs a third Bailout Program. This Bailout Program costs around 80,000,00000080 5 billion euros, and it is difficult to have an agreement. The two signs are inching toward this agreement so we will probably avoid the collapse of the Greek Economy and avoid the return of greece. It is a Good Development and the terms are very tough. We will have to put our house in order to do something about our pension system, which absorbs 14 of gdp every year, which is a european record, and to privatize part of the state sector that keeps losing and wasting money. We are back in business, at least. Anna you, of course, represent another political view. You arent in the member of the you arent a member of the Prime Ministers party. How do you think how likely do think it will be for tsipras to get approval . Will he be able to get the support of the Greek Parliament . Georgios yes. I belong to the new Democracy Party, which is a centerright party, liberal in economic terms. The support the Prime Minister because we believe that this is the only way to save the day, save the country from collapse. He is put in this awkward position where proeuropean parties support mr. Tsipras. His party is split even if some of his mps abandoned him, we will take their place and support him, because we have to make a deal with our European Partners and creditors otherwise we will have to face star consequences. Anna is your assessment that the Prime Minister does not need to convince other members of his own party . He would be able to get this through even if he does not have the support of the party . Georgios yes, of course. I am a member of the European Parliament the Greek Parliament gave him an approval vote. 251 mps out of a total of 300. For the first time, there is a National Consensus that we have to do something in order to put our economy in order. This is the big event in greece because of greece, we have too many politics. We dont solve practical problems. It seems that we are about to change this greek rule, because i otherwise we are doomed. Anna what do you make of the demands by the creditors that greece should put assets into a company in luxembourg . That has been described by some as a dealbreaker something greece wont sign off to. Georgios i think it is reasonable, because the president s government doesnt want to proceed with the privatization process. It doesnt want to be pushed in that direction. Of course, there are assets sold for 50 billion euros so i can tell you you cannot sell 50 billion euros in greece. But the principle is helping to find a compromise maybe you can get 10,000,000,00015,000,000,000 euros by selling state property but you cannot get 50 billion euros, i assure you. Anna the latest news from brussels seems to be that there are talks of stall as tsipras is making his last stand. What do you think will be the holdout issues, here . What will be the issues that stop an agreement being made in the coming hours, if there are any . Georgios yes, i think mr. Tsipras wants to get rid of the imf. The imf participates in the greek program. Mr. Tsipras claims that the whole issue is a european issue, and we should get rid of the imf. Byut he is not in a position to debate these terms i think we need the imf because he has the expert because they have the expertise. It is another thing to ask for 110 billion euros there is not an abundant supply of state money in the eurozone. Things are pretty tough. To compromise the imf will be involved in the greek program. It is not the end of the world in my view. Anna Angela Merkel has said that trust has been lost the you think the creditors should trust this greek government . Georgios nogeorgios . Georgios no. Those that voted no realized that you shouldnt trust the greek government. We dont have to solve the trust issue. We just have to go forward and show the common problem, which is how the eurozone can function with greece staying in the eurozone but not creating a lot of progress in the functioning of the eurozone. We have to be competitive, the eurozone has to compete with the United States, with the peoples republic of china. Its not an issue of greek survival, it is much wider. Anna do you think the greek people will be amenable to what tsipras is having to sign up to in brussels . Will he be able to sell it to the greek people after we saw that historic vote . Georgios nobody is happy in greece. Everybody is grumbling. But we will have to decide whether we want our banks to reopen, whether we want our euros in the banks, because our deposit is in the range of hundred 25 billion euros, 125 billion euros, and nobody can take money out of the bank. We had to make a strategic decision where we can follow a very strict program or reopen the banks. We will probably have to go back to the drachma otherwise, and we will have an inflation rate in the range of 15 20 per year and we will have social tensions that extend to the balkan chaos. The difference is that despite that the balkans we used to be a balkan country, but during the last decade we tried to transform into a european country. Obviously, it would have failed, this transformation but we are being given a new chance, a first chance, through a third Bailout Program and i think we should take it. Anna you sound very optimistic this morning. Thank you very much for joining us. We are still joined a very optimistic view. We have this curious situation where sippers wants to sign up. I think even within his own party people want him to say this the great people said, look, we are really suffering. The amount of payment has gone through an equivalent of what happened to the u. S. In 2009. I said it earlier in the program essentially, greece has been they are saying that we dont trust you, we will supervise the legislation through the imf to make sure the laws you pass are within our agreement. The mp we just heard is hopeful because they have no other choice. What im not convinced about there have been other exits from Currency Unions. All of the resulted in a sharp fall initially but not all of them have a longterm adverse effect on the economy. Im not convinced the other thing is, if you keep on cutting expenditure, as was the case when we went through this that recession, it does have an adverse effect. Anna i have heard a number of people raising the question about whether greece it be better outside the euro. Thats a whole new conversation. Thank you so much for joining us. 6 56 in london. Coming up in the next half hour on countdown, stocks fall in brussels after 15 hours of conversations. We are life in the ground in athens and in brussels we will get you the take from the greek capital and indeed from belgium. Stay with us. Tsipras rejects creditor demands to create an independent fund that would sell state assets and minimize the imfs role in a bailout. The euro drops on the news but still shows some resilience. Anna chinas equities rise while june exports beat estimates. And, a Nuclear Accord on iran could be announced as soon as today. Oil extends its decline. Welcome to come down. Im Ryan Chilcote in athens. 2 an anna and im anna edwards in london. It seems that markets are not showing a great deal of risk aversion. Lets look at how the currency markets are trading. This is eurodollar. 1. 1174. Ive given you a onemonth chart so you can get some perspective. We are trading above levels that we were at on the 29th of june when greece did miss that imf payment. Even on euroyen, we havent seen all of the gains that were made on friday unwound. Some of that optimism that was in the markets still there, even if talks are stalling. Talks have stalled in the latest lines coming out of brussels. Lets talk about the asian equity session. We are in limbo there. We are also in limbo on the equities story. It seems that the markets in asia are going their own way. The shanghai composite up just around 3 . A lot of domestic news flow around that story. We saw all those measures taken last week to try to revise the stock market. Perhaps some of those have been successful. Lets get an uptodate picture on the ground on the greek story. Emergency talks to keep greece in the euro stalled after 15 hours, when Prime Minister tsipras rejected creditor demands for a state asset fund. Greece was given until wednesday to enact a list of demands. The alternative, leaving the euro. Lets get straight to our correspondent on the ground. Nejra cehic joins us from brussels. Ryan chilcote is live in athens. What is the latest in brussels . Nejra the latest weve heard is that Alexis Tsipras has rejected this independent fund that eurozone finance ministers wanted to create to sell 50 billion euros of state assets, a privatization fund. We have been hearing that this was the Sticking Point, the dealbreaker, for the greeks in negotiations. It looks like it has pretty much broken the deal for now, and Alexis Tsipras has rejected that fund. The other thing greece is trying to do is minimize the role of the imf in a third way allowed. Although a Alexis Tsipras has said before that talks would have progressed more quickly had it not been for the imf, the imf is one of the parties that has been on the more supportive side of debt relief for greece. We dont yet have the reasoning behind these rejections, but that is where we stand. We are now 16 hours into talks. We have got to be reaching a record on this, and still no deal for greece. Anna what has the reaction been in terms of how harsh the demands are that are being made by creditors . A lot of reaction on twitter. Put it in perspective. What has the reaction been like . Nejra greek officials said a few hours ago simply that these demands would be very bad for greece. Weve had reaction from paul krugman, calling the list of demands madness. Weve had a former advisor to Yanis Varoufakis who recently resigned as greek finance minister, saying that the demands were so punitive as to be almost impossible. From the eurozone finance ministers point of view, from the creditors point of view you would imagine that they think these demands are reasonable given how much greeces economy has deteriorated since the capital controls were put in place, and also given how much trust theyve lost in Alexis Tsipras and the greek government to implement any reforms. Anna ryan, what is the likelihood of tsipras getting these demands and acted by monday . He might not have the support of his own party. We spoke to the new Democracy Party earlier. They were suggesting that those opposition groupings might be fairly supportive to tsipras if hes going along with creditor demands. Ryan it is a bit of a copout but it is possible that he could get a deal. Let me give you some headlines from greeces labor ministry. The greek Prime Minister was speaking on national television. He says greece is close to a deal and that the government of this country is trying to get the least bad deal, the least catastrophic deal. He said the governments maturity in parliament is an issue. That is an indication that the greek Prime Minister is concerned that he may not get the majority he needs to get the reforms that the creditors are looking for through the parliament by the deadline on wednesday. We know there is some support. Over the weekend, the parliament met and in theory expressed their support for the idea of raising sales is and cutting pensions. What we dont know is how all the parliamentarians feel about these other issues, the other demands introduced by the creditors. Namely the idea of syriza rolling back some of the initiatives that it has introduced in this country since it came into power that dont enjoy the support of the creditors. Also, the kinds of insurance policies that the creditors are looking for, like automatic spending cuts if reese mrs. Its budget targets if greeces misses its budget targets. Finally, the fund that would be set up in luxembourg that would effectively offer the state assets up for privatization as a form of collateral if greece failed to pay back some of the 86 billion euros it is seeking to get as part of this third bailout. Exactly how doable this is people disagree on that. One thing is very clear. Even if it is, it would require an Alexis Tsipras to reinvent himself as a politician. He would have to bring some of the members of the opposition on board and he would lose the support of some people in his own party. That could mean at a very minimum, a reshuffling of government ministers in this country. Anna where does that leave the Banking Sector . You brought us footage of people forming lines outside those banks. Ryan it leaves the Banking Sector in limbo to put it lightly. I was talking to a member of the opposition in the parliament. He was saying, even if there is a deal in brussels, the banks will remain closed for months. I went to a cash machine last night. A line of about 20 people at 10 00 in the evening. These people are trying to get 50 euros, because there is a shortage of notes. The company the country is running out of bank notes. Everybody is concerned that the banks are going to run out of notes altogether. In addition to needing to cover daytoday costs, they are worried about a bail in like we had in cyprus. They are worried that they may not be able to access their cash at all. Theres huge pressure on the Banking Sector. The capital controls that were introduced to weeks ago, we are in week three. People with lots of money in the banks pulled it out. Now it is people with smaller money. The banks will have to be recapitalized no matter what. Part of that 86 billion euros would include at least 10 billion to 25 billion for recapitalization of the banks. People in this country are concerned that wont be enough. They think that their savings will be rated. Anna ryan, thank you. Ryan chilcote in athens, nejra cehic in brussels. Nine minutes past 7 00 in london. Bond markets across europe just waking up. Caroline hyde is with us with the details. It seems markets are in limbo as these talks are in limbo. What are the latest signs . Caroline the flight is back on when you look at the debt market. We have seen a bit more appetite for risk. Today, we are seeing risk aversion. Have a look at the german 10year debt. Currently, seeing borrowing costs falling. That means bond prices are rising. Money flowing into german 10year, going into france coming out of portugal, italy, and spain, and coming out of greek debt. On friday, we saw a five percentage point fall in borrowing cost for greece. Today, you are seeing a rise of eight basis points. The moves arent dramatic when it comes to greek debt but there is worry about contagion. Uncertainty hitting the euro. Not as much as weve seen over the past couple of weeks, when every monday, we had new headlines to suggest. This is when we heard that a referendum was being announced. The monday before this was when we got the outcome of that greek referendum. This time, still a bit of a selloff, but not as much as weve seen. That uncertainty basically leaving the market in limbo. We are not seeing quite such huge selloffs in the euro. We are seeing risk aversion in the equity markets. We are seeing euro stoxx futures signaling we could lose about a percentage point in terms of value. The dax could fall about 0. 6 . The cac 40 could also come off in france. Euro in limbo, but we are seeing a flight to quality and safety. Anna thank you. If you want to join the conversation this morning, you can join us on twitter. One of the hashtags that has been trending this morning is thisisacoup. Do you agree with that order you think demands being made by creditors are necessary to restore trust . Lets talk about the markets in general. Interesting to see that maybe we are going to get a little risk aversion in todays trading europe. Lets talk about china. In just one month, we saw the equivalent of the annual economic output of the united kingdom. Those are the numbers we are talking about with regards to china. Give us your thoughts. Blackrock, ubs, and templeton have said they are not ready to buy yet. We had a bubble in china fueled by weaker investors borrowing on margin. The Government Intervention is not over yet. They are trying to make sure that people are not using multiple accounts. In terms of absolute value, we think that it is interesting. However, you have no real idea of where the market is going to be. We think that probably there is another fall to come. It looks as if the government has stemmed the tide. Anna regulators at Central Banks have had to be very creative when it comes to dealing with the fallout of the financial crisis. Quantitative easing was the product of some creative thinking. This is chinas answer to a falling stock market. Saker it is unusual. All weve been hearing is if you step back from the greek crisis and what happened in china, what we are getting into is this super cycle of very low Interest Rates. The longer it is extended, the more unsure i am of how we are going to come out of it. This is not normal economics. One looks at the bond markets and wonders what is going to happen in the mediumterm. Anna thank you very much. Saker nyusseibeh from hermes with us. Caroline is back with us for the latest news flow. Caroline just keeping an eye on some breaking news coming out of lafarge and holcim. As was said on july 10, we have new headlines today that eric olson will become the chief executive. Eric olson is the ceo of the combined unit and a new member of the board of committees. Theyve managed bruno lafond was the man who was thought to be for the job. I also want to bring you breaking news on another company. This is a u. K. Listed company that makes Specialty Chemicals. A deal could be on the table. More m a in the news. A u. S. Company could be offering as much as 2. 3 billion for this Specialty Chemicals company. They say it is valued at 1. 3 5 billion pounds. This is a u. S. Company seeking out u. K. Assets. Platform is getting an undertaking for 22 . The transaction is to include partial share alternatives. Ill have more coming throughout the morning. Anna caroline, thank you very much. Caroline with the latest on some m a stories. We will bring you uptodate with the greek labor markets. The labor minister saying that elections are necessary this year. We heard from ryan fairly close to tsipras. The conversation in brussels seems to have stalled. We understand the stumbling points around putting assets into a luxembourgbased fund. Perhaps that will be where this story dives to next. Coming up on countdown, Angela Merkel warns greece that it has lost the trust of its european creditors. We will get the news from germany with our next guest. Anna welcome back. It is 7 19 in london. Emergency talks to keep greece in the euro have stalled after 16 hours. The greek Prime Minister rejected calls for the creation of an independent fund to sell state assets and to minimize the imfs role in the bailout plan. This Development Comes after euro area leaders gave Alexis Tsipras a deadline to an act reforms. Chinas june exports are up for the first time in four months. Overseas shipments rose 2. 4 . The chinese growth is stabilizing. China will release gdp growth figures on wednesday. Protesters have reached the perimeter fence at Heathrow Airport and are staging a protest. The airport says it is working with police to deal with the incident and is advising passengers to check with their airline before traveling. There could be delays and cancellations. Lets get more on our top story. German chancellor Angela Merkel warned greece that it has lost the trust of its creditors. Joining us is marcel fratzscher. Great to have you on the program. What is your assessment of where we are right now . The talks seem to have stalled in brussels. What do you make of the weekends developments . Marcel i think we are very close to a deal. It looks like there are some details to be clarified. From berlin, there is a willingness to have a deal. At the same time, the German Government faces a tough stretch. German Public Opinion is very much against the deal. They dont want to see more money going to greece. They are in favor of a grexit. The German Government has a difficult stretch satisfying german citizens and trying to foster a deal in brussels. Anna paul krugman has been throwing his view into the ring. He says that what is being asked by the creditors represents a complete destruction of national sovereignty, a grotesque betrayal of everything the european project was supposed to stand for. Do you see any truth in his comments . Marcel there is some truth. No one likes to give collateral of 50 billion for privatization but there is a view in berlin and in other countries in europe that the first two programs for greece have failed. The last five years was not a success story. The greek government never really stuck to the agreement that had been reached. The idea is how can we not repeat the mistakes of the first two programs . The answer in berlin is, we need much tougher conditionality and collateral from the greek side to make sure we have a better chance of them implementing reforms. Anna the alternative view would be that it is not the lack of reforms that scuttled the last two deals, but it was the level of austerity. Do you see any validity there . Marcel i think it is difficult to see. There is still a lot of reforms needed to reform the institutions in greece. There is a view that we have realistic goals this time on conditionality. We might be making a lot of progress. There is expectation that it could work, but it will be tough on conditionality. Anna what do we learn about the strength of the euro by looking at the way the french and germans dont seem to be on the same page . The europeans and baltic countries are not on the same page as the greeks. Those countries that have suffered their own austerity dont what other countries to get off scott free. Is that healthy debate or something fundamentally flawed in the design of the currency . Marcel in my view, the agreement the disagreements are overstated. By and large, on most points, there is agreement among all the major European Partners. We want greece to stay in the euro. We want to get a deal done. We want the country to reform. There also is an implicit agreement on Debt Reduction restructuring of debt in greece. I wouldnt overstate these differences. These are normal differences in the negotiating process. The bigger question is, what do governments make out of this process . Will they have the willingness to reform . It is not just about greece. We need to think about the future. It is a very tough question. Anna and we are just seeing manuel valls saying that germany and france need to Work Together on greece. Do you see any validity to the argument that the conditions being attached to this third bailout are so onerous that they are designed to make greece choose to leave the euro . Are there some voices in berlin and frankfurt who would like to see that happen . Marcel no, i strongly believe berlin and germany is very proeuropean. There is a sincere interest in getting a deal done. It is difficult for the German Government to face a german public that says, no more deal we want greece to leave. On the other hand to say we want to get a deal done in brussels. There has to be reassurance and collateral from the greek side and clear conditionality, how to enforce those reforms. It is one thing to agree on reforms area we had a great agreement in 2010. The implementation was really the problem. The idea is, lets not repeat those reforms programs. That is the aim of the negotiations. Anna thanks for joining us. Marcel fratzscher, president and ceo of the German Institute for economic research. Lets get some last thoughts with our guest, saker nusseibeh. You have a little more sympathy with Paul Krugmans views. The hashtag on twitter thisisacoup krugman agrees with that. Saker they are asked to give their own assets as collateral. If this were a normal company [indiscernible] but you are dealing with a country. If you believe in the euro, it must mean that there will come a time when local sovereignty is given up in return for central sovereignty. That is how it works in the United States of america. That is what the Central Authority is asking of the greek people. Anna great to get your thoughts on this complicated story. Saker nusseibeh joining us from hermes. Coming up, as the euro become immune to greeces turmoil. We will put that question to our next guest. Anna welcome back to countdown. It is half past 7 00 here in london. These are the stories you need to know. Emergency talks to keep greece in the euro have stalled. The greek Prime Minister rejected calls for the creation of an independent fund to sell state assets and sought to minimize the imfs role in the bailout plans. This comes after euro area leaders gave Alexis Tsipras a deadline of wednesday to enact reforms. Chinas june exports are up for the first time in four months. Shipments rose 2. 1 from a year earlier. The data is evidence that chinese growth is stabilizing. China will release gdp growth figures on wednesday. Iran and world powers may be close to reaching a nuclear deal. One of the biggest divisions was resolved on sunday. A senior diplomat said a political agreement this week to lift a United Nations arms embargo. John kerry had a working dinner with Foreign Ministers. Less than half an hour to go until the start of European Equity trading. Caroline hyde has a look at the markets. In the asian session, we didnt see a great deal of nervousness expressed in equities or affects. Equities or fx. Caroline i think closer to home there is more concern about greece. We are seeing risk aversion play out in the equity markets. Futures already trading here. We are currently about a percentage point. The euro stoxx 50 off by 0. 9 . Similar moves in france. The dax a little bit worse. We saw two big days on thursday and friday, in excess of two Percentage Points added each day to the stoxx 600. We are back to a day of selloffs. If you are looking at german 10your death, we are seeing borrowing prices go down. France, pretty much flat. We are seeing risk aversion in the periphery of europe. You are seeing italy borrowing costs rising. Spain, we saw those borrowing costs come down on thursday and friday. We saw greek our own costs down five Percentage Points on friday. The market isnt pricing in complete collapse here. They are not pricing in a grexit you. There seems to be uncertainty as to which way to turn. The euro hasnt really been reacting as much. Two mondays ago, we got the referendum announced. Last monday, we got the results of that referendum. Down 1. 3 . Today off by 0. 7 . It is a move, but not nearly as big as there has been in previous weeks. Maybe a bit of numbness to what is happening in greece. We are still seeing some move into a buildup of shorts. And the likes of pimco, the biggest bond manager in the world, has been buying up u. S. Debt over the past couple of weeks. At the moment, not huge moves when it comes to bonds and equities. Anna caroline, thank you very much. Greece and creditors are one issue short of a deal. That one issue is the question of this luxembourg fund. It is being reported by various greek media that the missing issue they have to sort out is the privatization, the 50 billion euros going into an external and independent fund. That is the issue that is Holding Things up. Lets get to athens. Ryan chilcote is therefore for the latest on these negotiations. Greek Prime Minister Alexis Tsipras has rejected demands for this fund to sell state assets. Where are we here . What is the latest in athens . Ryan we are getting confusing signals. We have heard from greeces labor minister. We know that the greek Prime Minister has been saying that greece is very close to a deal. And that the greek government is trying to get the least catastrophic deal. He says that one issue is, there is concern about the governments parliamentary majority. You were talking about the issue of this private fund that would be set up, of 50 billion euros of greek government assets that would be used as collateral should greece have issues in repaying some of the 86 in euros it is seeking to get in funding or should it have issues paying back the money from the proceeding bailout. What we know is that this parliament in theory supports the idea of both cutting spending, cutting pensions, and raising taxes. They had a theoretical vote where 251 of 300 ministers said they would back that. There has been some more recent demands. What we dont know is where the parliamentarians stand on this. If the greek Prime Minister is able to get this through parliament, it may not be without pain. He could do it with members of the opposition. But he might do that at the expense of some of his own Political Support on the left. He might be able to do this deal and you can just imagine as they are negotiating in brussels, he is not going to agree to anything that he doesnt think he could deliver in the deadline hes been given back home. Anna ryan, thank you. Ryan chilcote with the latest on the ground in athens. Lets get a market perspective. Joining us now, the imf head of global fx strategy. How do you read the lack of chaos we are seeing in Foreign Exchange markets . It is preternaturally stable. I am shocked at how stable the euro is. I think people are just accustomed to a lastminute solution. They always expected that at the last minute, the eu would pull a rabbit out of a hat. So far, the rabbits dont seem to be coming. Maybe we can just see their ears poking over. Anna give us your scenarios about how weak the euro could get if this summit doesnt result in anything very concrete. How strong does the euro get if we see a deal coming through . Marshall i think weve got two scenarios, a bad one and a worse one for the euro. If they do come to an agreement people will start to focus on fed tightening. That is what we saw. As soon as greece seems to be resolved, the fed fund futures start moving. If greece does pull out, then we are in uncharted territory. We go through the 1. 09 level and then people start challenging the previous bottom. Anna it is other currencies as well. When you see risk aversion trades coming on, you see investors getting out of more risky assets. Yet theres been quite a lot of stability throughout this crisis. In the face of all the selling of the Chinese Market we saw last week. Marshall some people are talking about intervention in the euro. The swiss has been intervening. Anna are all the fx traders just on holiday . Marshall it really is a mystery. The greek issue is offset i the fed issue. If greece goes out, the fed doesnt tighten. These two offset each other to a certain degree. That means there isnt such a big change in the regime. I think people would be surprised at the size of the change. Anna you are based in cyprus, a country that has had its own a aryans with capital controls. What is the learning, other than capital controls are easy to implement and hard to remove . Marshall that is one major thing. This fiveyear grexit seems to me to the nonsense. We had capital controls for two years and our problem was nothing like what greeces problem is. Though what i would take from it is, if you bite the bullet, do the reforms, capitalize the banks, it is possible to get back on a growth path. I think the economy is starting to turn up and think are looking better now. Anna where does the euro go from here . It seems that these competing truths about the euro, one was that you could never leave, and the other was that there were rules attached the membership. They seem to be putting the latter of ahead of the former. Where did that leave the Currency Union. I spoke to saker nusseibeh and he said they are treating it not as a Currency Union, but as a club that you are a member of for a little while. Marshall we are back to the old Exchange Rate mechanism, where one country decides it cant take the rate they are assigned, and they devalue. I think people would start to think that that is the situation again. People who dont right now see any currency risk would start to hedge their currency risk. German investors in spanish bonds for example. They might think, i should hedge 10 of this area of this. That is why i think you would get a much bigger response in the euro. Anna thank you for joining us. Marshall gittler, head of global fx strategy at infx. The latest news flow coming out of brussels, the talks have stalled, but the latest out of the euro summit is from the multis. They are saying that the final lap is on. We are getting news flow that suggests there are very few issues standing now between these parties and an agreement. Coming up on countdown, greece has until wednesday to enact reforms or face euro suspension. Stay with us. Anna welcome back. It is 7 44 in london. Here are the stories you need to know this morning. Emergency talks to keep greece in the euro stalled. The greek Prime Minister rejected calls for the creation of an independent on to sell state assets. These latest developments come after euro area leaders gave Alexis Tsipras a deadline of wednesday eto enact reforms. Chinas june exports are up 2. 1 from a year earlier. The data is fresh evidence that chinese growth is stabilizing. China will release gdp figures on wednesday. Iran and world powers may be close to reaching a nuclear deal as soon as today. One of the biggest divisions was resolved on sunday. A senior diplomat said a political agreement was reached to lift a United Nations arms embargo. U. S. Secretary of state john kerry had a working dinner with Foreign Ministers. We are just getting some commentary from various people at the summit in brussels. The belgian Prime Minister saying that agreement at the greece summit these comments coming through on twitter. There, he just says agreement in code one word on his page. We are getting greek officials saying that the summit will end in about 15 minutes time. It seems we have a deal, is the quote from a cypriot spokesman on twitter. Looking to see if we are going to see any reaction in the currency markets on that. Focus on what is happening on currency markets. We are seeing a spike higher on the euro. It climbs. It seems as if we might be getting closer to something more solid coming out of this greek conversation in brussels. That is having a bearing on what we are seeing here. The stoxx futures are raising. The eurodollar is spiking. Just a little bit below that now. Twitter seems to be quite slow this morning in some circles, perhaps due to demand. We might be getting closer to a deal. Lets get back to nejra cehic in brussels. Some of the latest news suggests we might be getting closer to a deal and Financial Markets are responding. Nejra indeed. Im hearing that we might be seeing some Prime Ministers leaving the meeting imminently. Keep an eye on that. Theres bound to be a flurry of comments coming out of those meetings as to where we are with this, what has been agreed. Before this, we heard that Alexis Tsipras had rejected one of the creditors demands. That was the creation of an independent fund to sell off state assets, a privatization fund. That was a Sticking Point that tsipras rejected. They also wanted the imf to play a smaller role in a third rail out. We are moving into the 17th hour of negotiations now. People are coming out. I will hand it back to you and keep an eye on those exits. Anna thanks. We are hearing from a greek press aide that the summit has reached an accord on greece. Just to reiterate, bund futures are falling. The opposite of the risk aversion that we saw at the start of the trading day. It seems there is more appetite for risk now. The euro, 1. 1166 on eurodollar. A great deal of movement around this story. It does seem we are getting closer to a deal. Euro stoxx 50 Index Futures rising as i speak. They suggest we are going to be higher at the start of trade perhaps by 45 points or so. Futures all turning positive. Another comment coming through, we are close to an agreement this from somebody on the ground in brussels. A lot to digest. The news is coming just before the start of the european trading session. Ryan chilcote is on the ground in athens with a guest. Ryan lets talk more about the market. Im joined by antonio, a director at dexia voted the best Investment Bank by euromoney, the best in greece. Thank you very much for joining me. All kinds of positivity from a few different sources now. What should we expect from the open . I know you think theres been a real shift here in greece in addition to the headlines. I think the developments are generally positive for two reasons. One, you have measures that were necessary in order not to have a middle solution to have a complete solution that would change the landscape of greece once and for all. Secondly, we have a leader now, a Prime Minister who we expect to be there later this week and next week. That is one of the very few people in the country who can sell this to the greek population. For the First Time Since the crisis started, we are beginning to see the same dynamics that helped cyprus, ireland, portugal , come out of the program. That is full support of the population and the political establishment on both sides. This is a very unique dynamic. I know that weve gone through a lot to get here in the last five months and last five years. Now it is a golden opportunity for the markets, for investment in the country and for the eurozone it self. Ryan what everybody wants to know is, if tsipras gets a deal in brussels, which he may be about to get, looks like he is about to get, the story comes back here. He has to sell these austerity measures to the Greek Parliament. Can he do that . As far as passing through parliament, the answer is yes. He will have support from his own party and from the opposition. The problem is that his Party Politics are very complicated. The outcome of that and how the government would look the day after still remains a big weston mark a big question mark. But he is very uniquely positioned. He won a very strong vthe yes or no referendum the way i see it it was a strong vote of confidence for tsipras. The no meant a huge vote of confidence for tsipras to get to, and popular support. Ryan thank you very much. We have more breaking news. Anna, back to you. A very fast developing story in just eight in its to go until the start of European Equity trading. The news has been coming fast. It seems as if we might be inching toward a deal. Caroline has the market reaction. Caroline check out this by higher in the euro. Suddenly trading in the green. It has been trading off by 0. 3 all morning. This hope of a greek deal brings it back above. Borrowing cost now rising. We are seeing money coming out of the havens. Bond prices are rising. A rally for the periphery of europe. Not quite making it on greece yet. Stillim sure on the twoyear, we are seeing bigger moves. Lets look at how stocks could open. These are the futures markets. Euro stoxx 50 now pushing higher. Could see a 1 rally. That is a third day of gains on the stoxx 600. Anna caroline, thank you very much. On the move will be here in just a few minutes. Jon ferro joins us now. A fast moving picture. Where are all these fx traders . All of a sudden, the news flow and the currency markets woke up. Jonathan we rallied into the weekend with a lot of optimism and then hit a big snag. This morning, we get news that it looks like a deal is imminent. We could get an announcement very shortly. What is interesting to me is what shape this deal takes. There are some big Sticking Point here would number one being that large fund that greece would have to put state assets into. Tsipras was making a last stand. Weve got to wait for the headlines to drop. Anna we are just getting from yet another source, the Prime Minister of malta, telling us the same deal. The one word he is using to describe this, deal. We have heard from a number of people very closely involved in these conferences that a deal has been done. The European Equity markets look as if they will enjoy something positive. Euro stoxx 50 futures now up. We could see a move higher on the cac 40. The euro has been making some moves higher. We will keep an eye on it. 1. 11 74 is where eurodollar is trading. We will leave you in the hands of on the move. Jonathan good morning and welcome to on the move. I am jonathan ferro. Moments away from the start of european trading. Lets get straight to your morning brief. Donna deal. Eu summit reaches a deal with greece. They eu rallies. Shanghai stabilizes. Stock rises and 400 companies resumed trading wife out while the countrys exports rise. On the brink of a deal. A Nuclear Accord on iran could be announced as soon as today. Crude extended declines. There is only one thing to talk about an agreement in brussels after talks went over 12 hours long. Futures higher. Of 24 points. Dax up almost 150 points. Straight your market open with caroline hyde. Carolina by caroline he spake a spike higher. Well wait for the cac. Two days, thursday and friday we saw the stoxx 600 and four Percentage Points added at the end of the week. Now, fuel to the fire as a deal is done. Unanimous agreement. The president of the eu coming out and saying there is a deal and they have agreed with greece. Fuzzy up almost one percentagef point. Ranc