Center right now. Were starting to see more evidence of stimulation coming in. M a speculation. You are beginning to roll some of the Biggest Companies together in china. That is an effort. Yes. Exports as well. Still the best today rally in a month for the shanghai composite. You dont need shippers in the way that you once did. Maybe they need some help. This is the mna story of the morning. A story of the morning. Greases the story im really interested in. We all know what is happening with greece. Today he could see a deal. At last. We need to deal them by august 20 been that big ecb payment comes through. Another payment and another deadline. There is speculation that government will accelerate growth around state owned companies. Give us the rundown. We are seeing the shanghai composite higher. The rest of asia not looking so good. It is an interesting divergent. Quitembers were discouraging. Some market seeing some turnaround now. Japan of about 3 10 of 1 . Beenig story that has driving the composite higher, look at this 3 gain. Despite the decline, there is this shipping story we are following paper following shipping stop spewed theres a lot of speculation in the markets that china will merge its two biggest shipments. Companies. They do a big business. , it is chinas ongoing efforts to consolidate and rationalize some of the state owned industries. Make them leaner and more competitive. We had china doing everything it can to stem the drought. It is a big concern for investors. That couple with economic slowdown and abysmal numbers leading to some skepticism among investors. The thick a look at some of the shipping stocks we have been following. Kong. In hong they are suspended in pending further news. This is what we have right now. We have the shares rising. 10 gains. Just a snapshot of some of the companies that are connected. There is investor enthusiasm. It is a key reason why they are not so good economic numbers. Back to you in london. Andy. Nk you very much thank you very much indeed. The shanghai composite is classic story of what we saw in europe and in the u. S. Composite. Shanghai here you are. P to drop. We come peaked to drop. How much has the government had to do to control some of that . , the Central Banks had been five if over the past not decade or so of quantitative easing. They are issuing infrastructure bonds. Yep that. Is not ending at. We mentioned in a couple of times. What caught my eye is a large drop in exports. A steep decline in ppi. Continuing to fall. Stephen engle is in hong kong for us. Data out over the weekend. What does it lead to . It leads to a lot of debate whether there should be more stimulus from authorities. Type of kneejerk reaction we get when numbers are disappointing. The oftentimes go up on the stock market. People automatically assume the government is to step in and stipulate that stimulate. Step in and stimulate it has a really sparked the economy. To the had several cuts requirement. They still have a lot of room to grow. They expect at least another benchmark Interest Rate cut. T least a 50 basis point cut we no longer have the stock market giving an artificial sentiment boost. That is what they are talking about right now. More stimulus from the government in the form of policy easing. There has been rumored talk about the old cocktail selling bonds throughout the provinces. Railroads, bridges, and the like. And of course, many people are looking at the strength it had on exports. It coulde saying depreciate health exports in the future. How likely is that . Has been the debate that has been going on. There has been a bit of a race to the bottom. The euro has been weaker. We saw this reflected in the monthly export numbers. 3 . Ts were down a much more than expected 8. 3 . Much more than expected. Allow the currency to depreciate. Depreciating the currency, we have seen it with japan. It has taken a couple of years to process. Good china go on a depreciating trend . China go on a depreciating trend . It is not likely. It would not please its trading partners like the u. S. Thank you very much indeed. More details on this story. Bloomberg reported that they will be merging. What is the latest on this . That the hongw is kong listed units for the ping companies lot were suspended. We know Something Big is coming. What we have heard in recent months are Senior Leaders saying they were turning their attention to state owned enterprise reform. This is known to be high on the policy agenda for the leadership. This seems to be a new step in that. Big thing to remember is that they have dominated so much of the economy. If the economy is looking for areas where it could spur growth and allow increased lending i policy banks and some of the other measures you guys tioned, we have reformed making them efficiently be a natural next step. In terms of that bigger picture, talk about what they are deploying going forward. Will it work . I think theres a technical issue. We will move on. Thank you very much. Greece concludes talks with the Bailout Program. We need to see a deal early this week in time for early funds. 3. 2 million ecb payment. We are watching that. There was a fivemonth shutdown. The index plunged. We will get an update on how ugly it has been for greece. We look forward to those numbers. It is a busy week for data. Tesla. Up next, embracing the dark side to make its cars. Should china continue to accelerate reforms . Stay with us. It is 6 14 a. M. In london. The two companies were suspended from trading on monday. There is slow demands for chinese goods. 3 below thed a estimates. The greek government aims to conclude talks on its program. Funds. N release the euro finance minister meeting will be held at the end of the week. Right didnt lets reaction to the china data. It was right. It is increasingly looking doubtful. Heres the head of asian strategy. To a bigikely to lead win when it comes to the headline gdp numbers. Give us your take. The biggest was negative. Can they keep nominal gdp from contracting . Downwe saw was contraction to around 6 or 7 . Look at currency indicators. Might be as low as four or five here it can they maintain nominal gdp . Gdp thatl jet to is where you end up with greece. Strategy,s of the china needs to impose reforms. What are the reforms you are hearing about at the moment . Key assets shipping companies being talked about at the moment. With this be what you want to see . Not at all. Unfortunately, we dont hear anything. It has to be known capital reforms. All of that is important. Productivitylerate in a domestic economy . Is agricultural services. Combining a couple of shipping come days. 10,000 state owned Enterprises Across china. How can you improve productivity of that area . Look at agriculture. It is actually in agriculture. Agriculturalad a revolution. As far as i can see, none of that is happening yet. That is very longterm. That takes generations to fully put into place. Now. Start planning how do you think theyre going to manage the story in the short term . A new storese is surrounding stimulus. How does it get managed in the short term . Two or three things. China is one of the few Major Economies with this positive real Interest Rate. You are still positive in real terms. That is nothing. Interest rates could go to zero. Number two, theyre still operating at 1618 . The answer is absolutely. Potentially lower than that. They are reeling for it to accelerate. Finally, fiscal spending. It is still relatively light. That is including the Balance Sheet debt. It could run higher. It is really monetary stimulus. It is needed. If you embark on a structural monitor policy, you get people in the streets. You have got a problem. Yet all of those things happening at the same time. Visit tend to be unleashed with fiscal stimulus . Yeah. You are selecting amongst ugly sisters. Would you rather by commodity producers rather than commodity consumers . Would you rather by those were dependent or a country that has significant liquidity . Everybody had substantial problems going forward. When you think longterm but , what is thening investment . A tactical play . How should i think about the Chinese Market . View, if youint of are finding a market as a whole, you should buy practically the view should be no more than a few months. The drives it is liquidity. That will continue to be the case going forward. Do you think china will stimulate . Your stockpicking has nothing to driven it has to be by fundamental analysis. Oft china has is a number interesting things you could invest in. Thank you very much. Great getting your perspective. Lets talk about what is happening with the fx story. You see data like this. The aussie and the kiwi both trading down. Strong. Ar is incredibly resource related. Through. E a hit coming the euro, there is a big move on friday. It is not all oneway street. Big news breaking over in turkey. Lets get details on this. And looks like a series of attacks. Looks like what appears to be an attack in a number of locations. Someme are saying residents have been asked to evacuate. Wounding five Police Officers. Bombing. A suicide it collapsed apparently. Agency is quick to refer to that as a terrorist attack. Tother they were referring kurdish militants it would seem unlikely. It is too early to say exactly who. There worrying and the trend we are seeing. Screen. Bring up the bounceback subsequently. Start to sees we maybe changing policy becoming more aggressive. Certainly. Still dont have a new government in turkey. There was the possibility that they would maybe somehow be part of the government. They are supposed to be up of politics. They are not keen to have the kurds involved. It is very complicated. And of course financially as well. A calm has prevailed for a number of years now. It is air based their. Complicating the turkey situation and relationship. This is an ongoing situation. You talked about the surrounding areas in the middle east. Be the next line of thought . Turkey has one of the most powerful in the region. It will take care of itself. They are concerned about what is going on. You have got the political calculations. It is attacking Islamic State and Kurdish Forces as well. We do get a very top located situation. My enemies enemy is my friend. It is not really adding up in this situation. There is a suicide bombing. Scene. Attended that perhaps it in is an ongoing situation. Well get more details on that from istanbul very shortly. Welcome back to countdown. T is 6 30 a. M. In london here are some of the stories you need to know. Countdown. Two Major Shipping Companies. This is according to people familiar with the matter. Data out of china 8. 3 . Orts dropped government is in talks on his third Bailout Program. There is a payment for the European Central bank. It could be held at the backend of the week. This is according to officials familiar. Lets kick it off with greece. That bailout likely to be passed . I think the news is encouraging. It is still on the table. Remember it is not until the end of this year. You have to be careful. What is the solution going to be . There is no doubt about that. Willingness. Es a this is a positive sign. Me think about your investments, do you care about reese . Greece . You saw the numbers. Gamble. It is a big for the future of the eurozone, there are skeptics. That it wasremember at the bottom of the class. What is the eurozone about . See. Greece is doing reasonably better. Greece had an option. It tells you there more implications. You are actually quite negative longterm. You feel a grexit is likely . I dont know. There has to be a lot of money to be paid. How do people feel about it . How long can they continue . Were talking about structural, that is a positive sign for the eurozone as an economy. There have been many remarks to scare everyone else. Of that contagion can take an effect. Everyone react strongly and does what they need to do. If germany looks to greece as an isolated case, you could make it work. If you start seeing negative concerned,nd may be i dont know which one it would be. It is multiple countries. That may be a different story. Lex that is what worries me. It is interesting you mention that. They should spend all the money in europe. This is a wait and see what will happen. The cost has to get paid. Debt relief will be agree just in the end . Everyone comes on board. Greece is in a big problem. Are you not really worried about it . When you try to calculate, how do you go about it . A slight discount. Weak. Tinues to be very on a mediumterm basis, you are not concerned. The economy, how much is the that that ecb i think it is being played out openly. It is being questioned. It is a good thing. Structural. S the writing is on the wall. Ecb is playing the part and helping out. It is extremely positive. It is not just an easing money policy. There. Ill leave you lets carry on with that conversation throughout the hour. Lets talk about oil now. It is doing something it hasnt done in years selling bonds. Talk us through this option. This is just the start, right . Enough to buy a few more back scratches for the royal family. Cass reserves of almost the same amount. Not a huge amount in the grand scheme of things. Why would they be doing that . Well prices. Thes having a big impact on economy and their reserves as well. Involvedsaudis being with the fight against the Islamic State as well. Theyre trying to maintain lavish spending. It has got a lot of needs for cash. It is not a huge amount. It does represent a start. The could be something in the region of almost 20 this year. They could manage it a little while. Arabia is trying to open up its economy more. That was back in june. It has sold at a shorter term. Get in. S investors to provide some kind of wrench mark. Allows them to tap into the Capital Markets more easily as well. Not just about the money. Markets to perhaps a more normal place to invest. Thank you very much indeed. The World Biggest gas producer could be hit hard by declining energy prices. Lets bring in bloomberg intelligence. The russian ruble sort of helped. Yes. Profits have more than doubled. Thing. A good it could help. Offset. Also be it is either a dollar or eurobased. Debtay see an increase in or liability. How long does it take for into therefeed is a link between the two, that it takes a while. Their gas price is at the very long time lows. As a result, we have seen tries like germany lag e have this we will see two things. Prices may be low. It will go for bigger market shares. Taking the pain. Yes. Thank you very much. Great having you on. Please join us on twitter. Indeed let us know your thoughts on all things china, greece, turkey. Coming up, we update you on the breaking news out of turkey. Gunmen have opened fire at the u. S. Consulate in istanbul. Update. Ll get an plus, it could be one of his. Iggest deals to date welcome back. Hear the stories you need to know. Countdown. Two Major Shipping Companies are merging. Suspended from earlier trading today. Goodsw demand for chinese. Dropped a. 3 , well below the estimate. The greek government concludes talks on a Bailout Program. Them to pass a deal on release funds before august 20 when they need to make a payment to the ecb. Finance ministers will be meeting if the Greece Parliament passes any required reforms for the next couple of days. This is according to officials familiar with the talks. Pit its talk about m a could be one of the biggest deals to date. It could be a 30 billion how does it feel . Once again, it is an industrial place. Rather than just focusing on the stock of picking and insurance area. There was metalworking in israel, for example. And the biggest one ever. Railroad. Rn santa fe ewhere in the region of there make a longterm bets. It would pay off big time when he is longterm it he will be 85 by the end of this month. They have a long track record of good margins. The revenues. And important customers. What does this company do . Im glad you asked. [laughter] engineering, technology, power ,lants, oil and gas industry most of the aerospace industry. Very specific stock for a very big company stuff for a very big company. The relationship has in doing for many endured for many years. Thee could look at some of customers. They are very embedded. Got boeing in there. When you talk to the ceos, one of the biggest concerns is the supply chain is stable. Ramping up production at the moment. Up. Have got boeing ramping it is these companies that they rely on so much. Is are the blue chips. I guess you cannot really see it that way. The top when there is General Electric. The other is the u. S. Government. Companies viewed big blue chips. It big organizations. It is important for these companies to have a reliable supplier. It is important for one buffet warren buffett. This is a big deal. Great. Is point. Oing it at a price it isnt going to be the biggest ever deal. Is not lookingtt to make a quick profit on this and sell out. He is betting 10 years, 20 years, 50 years for these companies. It looks through these like a banker looks through situations and inflation in the light. He looks through the variations. This is a Good Opportunity to get in there when the stock has been falling. When he goes into a stock that is not well understood come he does his do ill down he does is due diligence. That includes 36 billion. That was debt. This would be the secondbiggest. Then you go down the long list. Major deals. We see a shift away from things like insurance. It caused Berkshire Hathaway and to miss estimates. Why would i want a company that is an aggregation of a and connected businesses . Insurance companies and engineering for the aerospace industry. He mentioned theyre looking to move into new sectors as well. You said earnings were not very good. There are concerns about. This is an industrial come any. Company. If you are able to spark a garden with a good company, you go and buy it. The second thing come it is good to learn, which i did not know. [laughter] it, they areook at supplying some of the Big Aerospace companies. This is a sector that is in a longterm ramp up phase. Boeing and airbus, huge numbers over the last year. This ould execute on he doesnt do anything for the shortterm. We have been questioning the growth is slowing down, but it will restart again. It does not like we will never have it again. This is just playing into the strength of that. Lets bring in some of the Great Stories we have been having on bloomberg. Com. At best picks on bloomberg morning. We talked about making money and m a. Talk about making money in currencies. This morning is looking at the strong trends that are emerging in currencies this morning the stories are looking at strong trends that are emerging in currencies. The pound, the dollar hit everyone is jumping on the bandwagon it seems like. Just writing riding the wave really. The Dollar Strength story has been the story. For fx traders i have slight concern for the dollar going forward. I think it is interesting to see. There are making more money. I would say it is not for the fainthearted. Yet to know your fx market. Know when it gets crowded as well. China is a big theme this morning. You have got a story that is somewhat related to this. A squeeze in that sector coming. With the story is looking at is the blooming tiny steel export industry. Booming steel export industry. It is bigger than what is produced by the Biggest Steel Company in the world. How long can this last . Prices are pledging everywhere. Plunging everywhere. How long can it last . How long can the world suck up the supply . Are they producing it as a prophet or a loss . They are in the red. It cannot continue really is the view. We will be speaking to executives. What do you believe . Say is theould selloff one thing to bear in it is anhina incentive to free the sector. You have seen chan at 1. 0. It was very much you have seen china at 1. 0 percent. It was very much trade driven. Sales, but nott reducing. Managers. To bring in that is where china should go. That is where china should go. 1. 0 they have done. Taking millions of people up out of poverty. It has been great to have your views. You will be sticking with us for the next hour program. Thank you very much. Actually a light on some of the Great Stories on bloomberg. Com. Warm brick and is out of turkey it reports suggest the government may have opened fire on the u. S. Consulate. More details when we return. Keeping a close eye of the turkish lira. We will be talking about all things china and talk potential m a. We will be back. We wont count down until the market opens. One hour to go we will countdown until the market opens. One hour to go. Stay with us. Guy china stocks rally on the back of expectations that the government will merge its two Biggest Shipping Companies. Caroline optimistic that an 86 billion rescue package will be agreed today. Guy Turkish Security forces Exchange Fire with militants. Reports are indicating the gunman may have opened fire on the u. S. Consulate as well. Good morning, everybody. Welcome to countdown. Caroline so much to talk about. Notably, this breaking news we have had out of turkey. Terrorist attacks happening within, gunshots upon a Police Station. Guy there was an attack on a Police Station earlier this morning. We are still waiting to get clarity on exactly what happened surrounding this attack on the consulate. We will go to elliott gotten in a moment. In a moment. As you can see, a fairly interesting session. That is weakening. This is the u. S. Dollar versus the turkish lira. Weakening as this news has crept in. A. M. Arted at around 2 00 this morning, a story that is beginning to evolve throughout the morning. Caroline we will keep an eye on the stocks when they open. Another key story is china. Stocks posting their biggest twoday gain in a month amid speculation that the government would accelerate mergers among state companies. Zeb eckert is in hong kong for us. How is it looking today . Asia is down in general. Then we have the speculation that statebacked entities could start to be consolidated. Zeb that is what is giving optimism in the market despite that very disappointing export number. Certainly an interesting situation. The market is going in the opposite direction of sentiment. That china appears to be taking an additional step towards reforming its ,tateowned enterprises consolidating, making them leaner and more attractive to investors, giving that extra optimism. We should note the export data was dismal. That adds to the case for additional stimulus from the chinese. That is giving investors a bit more confidence after a very tough couple of weeks. Check out the shanghai composite , nearing 5 gains today. It is really extraordinary. The big story happening is merger speculation. As we said, we have shipping lines am a very active in hong kong at the moment, suspended. , chinahave this reportedly considering a merger between its two biggest shipping groups, China Shipping group as well as cosco. It would be part of a broader push to overhaul inefficient, staterun enterprises. It would create, if they merge, certainly, a force to be reckoned with. They did this in the past few months with the railway. Creating a Global Industrial conglomerate to rival General Electric the this certainly would rival those Global Shipping lines as well. Among the names in shanghai that you should Pay Attention to, some of these are duallisted in hong kong as well, but they are suspended today. This is what we are watching today, the shipping lines rising by the daily limit. China sea holdings, China International marine, Company Associated with potential merger targets are all moving today. Very significant, broadbased rally. It is lifting the entire market and extending those gains. Moveu can see, nearly a 5 today despite bad economic numbers from the weekend. Go figure. Caroline bad news is good news. We know it well here paid thank you very much. Guy let me take you back to the turkey story. Turkish Security Forces have exchanged fire with militants in is temple in istanbul. Gotkine is in london. He joins us here on set. What do we know at this stage and how has the story evolved . Elliott there were two separate attacks. There was this car bomb attack on a Police Station, where there were seven wounded, including five Police Officers. Separately, two gunmen opened fire on the u. S. Consulate in istanbul as well. Security forces immediately returned fire and those attackers apparently fled. All of this upsurge in violence we are seeing today, first of all, one would assume it is not completely unrelated to the fact that u. S. Warplanes started running from turkeys southern airbase yesterday. Of course, we also see the violence increasing in turkey since that attack last month, which killed 32 people in a suicide bomb. In the wake of that, turkey having sat this one out so far against Islamic State. Not only did it start launching attacks against Islamic State, but also against the pkk, one of the kurdish militant groups, which turkey considers a terrorist organization. Of course, the kurds have also been the most vigorous fighters against Islamic State as well, very much allied with the united states. We are not talking about the specific pkk organization. Turkey was sitting on the sidelines and there was revealing piece with the kurds prevailing peace with the kurds. Turkey has now begun fighting on two fronts, one against the Islamic State and one against the kurdish militants. Assume, although there is no responsibility taken yet, the attack against the u. S. , probably not the work of kurdish militants. We do not know for sure. The kurds do not really have a beef with the u. S. With the Police Station, that could be either, one would assume. Someone we now have live in istanbul for us. What is happening on the streets . Say this attack is a suicide bombing. It is currently unclear who may be responsible. There are reports that a bomb targeting the Police Station in istanbul wounded around five Police Officers and two civilians. Right now, there are five crews of police and mlss in the area. Police went back to investigate the scene and were fired upon. The explosion also reportedly damaged neighboring buildings and cars parked nearby. Turkey has seen a surge in violence. There was a suicide bombing related to isis killing around 32 people in southern in a Southern Province last month. Warplanes have shot at pkk and the Islamic State fighters in syria since late july. We do not know much about the situation, but we will keep you uptodate as we go along. Guy give me a sense of what it is like to be in istanbul at the moment as the violence starts to gather momentum. Give us a sense of exactly how people are reacting. Are they changing their behavior . What is the story in istanbul . We are getting a lot of warnings from police, saying that people should stay away from crowded areas, stay away from metros and shopping malls. Most people are going along with. Heir daytoday lives they are saying that they cannot really change their life that much. Turkey is used to living in this kind of environment, atmosphere. Beeny and istanbul has for many with pkk years now. People are generally considering with their everyday lives. Caroline thank you so much. Keeping us uptodate with all the happenings in istanbul, turkey. Have aopolitics does Market Impact and we are seeing that this morning. The turkish lira now falling versus the u. S. Dollar. It is the dollar versus the turkish lira. You telling you that can see a significant spike for the u. S. Dollar. The turkish lira trading weaker on the back of the news that we have had over the last hour. Caroline lets get the investors take. Is this something you will be factoring into your portfolio . The turkish people are quite used to this. Not for my portfolio, because i do not have much holding in that market. I am more concerned about the u. S. And china and europe. Im sure there will be some effect. Personalt for my portfolio, i would say. Guy we were talking about the fed and Dollar Strength. You actually see the dollar fading. When you look at the emerging happens around the world when the fed starts to tighten, what do you think the ultimate reaction will be . I am underweight emerging markets. With the Dollar Strengthening and when the rate rise comes, there will be some movement in the emerging markets. It is inevitable. I would start buying after the fed has raised rates. Then we will know when the next rate hike will be. My concern is more about the second rate hike and when it will be. I am presuming it comes in september. Every other meeting after that, you have to wait for a press conference. Caroline it seems like you have not and settled or sooth by s oothed by janet yellen. With respect to the emerging markets, there will be a lot of uncertainty. Week, on bloomberg, he mentioned it as well. It issonal view is that more likely the fed will look for reasons not to raise rates. Up. Expectation is built a lot of people do expect the fed is going to raise rates in september. Guy how will mario draghi be viewing this, do you think . He sees that the u. S. Is going to raise rates and that is going to mean weakness for europe. That should clearly be helping the euro, the euro zone economy. I am not thinking he would be much concerned. If he was raising rates, it should not be seen very negatively. So long as you are not raising rates to counter inflation or a recession or a high valuation, which is not the case caroline normalization, here we come, potentially. Thank you very much. You are staying with us. Guy we have got to take a break. First, another deadline for greece. With another ecb payment on the upizon, how they wrapped talks. Guy welcome back. It is 7 16 in london. That means it is 8 16 in frankfurt. Caroline all the stories you need to know this morning. China considering combining two Major Shipping Companies. The two companies are suspended from trading monday. Dated this weekend showing slowing demand for chinese goods. Exports down 8. 3 . The estimate was for a drop of just 1. 5 . Caroline the greek government aims to conclude talks on its Bailout Program by tomorrow. The timeline leaves enough time for the National Parliament to and release funds for the august 20 payment to the ecb. The euro area finance minister meeting will be held at the end of the week if Greeces Parliament require passes any required reforms over the next few days. Guy or details on this story. Marcus joins us from athens. Walk us through the hurdle to get the deal done and the hurdles that follow that. Marcus good morning. , the officials in the troika are combing through the details of this memorandum of understanding that they have been working through over the weekend. The greek side really want to get something. They want to finish by tomorrow. That seems very ambitious. Certainly, all the noise from the creditors we have been hearing has been very optimistic. People thinking about talking contrast with earlier in the year. Before can do this august 20, they can ratify that through parliament. The other parliaments in europe can do likewise. You can get a disbursement before august 20 in order to repay the loan. What the greeks want to avoid is another bridge loan. From the greek Government Point of view, they want this to be alreadyh because it has you know, this year, this whole protracted negotiating incess, the deal was reached july. If you are the greek government, Prime Minister suppress want to get it over and done with so you can move on governing the country. Caroline thank you very much indeed. Guy more on the greek story. We are joined by david powell and david, a european analyst at control risk. Lets get an understanding of what is happening here. Walk us through the risks. Probability of getting a deal done here or are we going to get some sort of bridge loan . Cooperation on the of the greeks and they have apparently done most of the work already. In the past, that was the major hurdle, the speed in which the greek government can handle it. That seems to be going quite well. Caroline the ongoing struggle is the imf saying we need some debt relief to greece going forward. They do not want to put any more money until that happens. We know germany is beyond that. What is the likelihood of sustainability in greece . If nothing were to change, the primary surplus is highly unlikely to be reached. In all likelihood, there will be some form of restructuring. It will probably not come in the way of a nominal haircut, but reduced Interest Rates and a grace period on those interest payments, as already exists on the loans from the eff. Hopefully that will be it. We have said that in the past. The next major hurdle for greece over the horizon is a major 10 billion euro rollover that has to be done in 2019. That really is the last major hurdle for them. , what is theid lee . Iew will we get a deal by tomorrow . Said, i think there is generally a more optimistic sideboth from the greek and the institutional side, saying that the greek government has been more willing this time together worked on, the work done, which has been the criticism of them. Tsipras wants to avoid a bridge deal, once to go straight to wants to go straight to a full bailout. There is some optimism this time. Guy elections later this year . Do not really see much of an alternative to it. Probably slightly more to the center politically. Is that government about to deliver what we are seeing transacted . I think what the elections were to produce would be, if you like, probably a National Unity government that would have almost a referendum affect effect. That would be kind of a Broad Coalition with most of the leftwing of his own party either in another party or effectively out. More mandate for the government, more optimism for the government in greece. What about the relationship with creditors . Are we going to consider continue seeing this at loggerheads . That has been the most interesting story over the last few months. The imf have stopped playing ball in a lot of circumstances, particularly on germany. I want to move you forward across toit and head turkey and talk about the attacks we have seen this morning. More broadly, what they are symbolizing in the increasingly difficult political, geopolitical environment that turkey finds itself in. Domestic politics and international politics. Turkey is a very difficult situation and has been for a while. Like what we have seen this morning, we do not know who it could be. There are a number of groups it could be. It could be Islamic Staterelated. Seems to me it is more likely to be related to a leftwing group. They attacked the u. S. Embassy in ankara a couple of years ago. Caroline what underlines that groups desire . They are a leftwing group. They oppose militarization and the u. S. Involvement in turkey. Caroline the fact that we now suddenly have the u. S. Fighter jets being stationed this is pretty much them. If it is them, that would be why. Guy how do we play this . , the last couple of years, has been slightly improvising with his constitutional plans. Think the situation, both over the Syrian Border and inside turkey, is a reflection of that. Istanbulike this in are just going to increase this its the sensation that he is not in control and there is a ee of caroline what about externally to turkey as well . This brings to the boil other concerns. With itsit set turkey neighbors . Stableey has been relative to all of its neighbors in the recent years. There is very much a sense that if turkey ceases to be a stable security environment, which this does not suggest just yet, but it suggests things are coming down from the peak of security and stability. It clearly has implications for andother countries nearby for european and u. S. Involvement in the middle east. Caroline great to have you on. Thank you for all of your insights on greece and turkey. Take you toto shanghai. We have been talking about china all morning. We have two conflicting pieces of evidence. Very poor data coming out of the chinese economy, but that has not stopped the shanghai composite. The reason for that is we have had expectations that the two Biggest Shipping Companies in by the chinese government. That is certainly driving stocks higher. Caroline more capitalization, more extricating. More than 1000 statewide companies is what our last guest was saying. And we are seeing more stimulus being injected, whether by the central bank or central government. Guy that chart looks very impressive. , you canke a look back fully appreciate the fact that chinese stocks have come down recently hard. It has not been a oneway street. Caroline we are on twitter. Guy good morning. Welcome back. These of the stories you need to know this morning. Caroline china is considering combining China Shipping group and cosco group. The two companies were suspended from trading on monday after moving more than 10 higher. Guy that is the good news out of china this morning, driving the stock market higher. But data showed slowing demand for chinese goods. Producer prices fell 5. 4 . Exports dropping a. 3 . The estimate for that figure was a decline of just 1. 5 . Caroline the greek government aims to conclude talks on its third Bailout Program by tomorrow. This leaves enough time for the National Parliament to pass the deal and release funds for the august 20 payment. The euro area finance minister meeting will be held at the end of the week if greases Parliament Passes any of the reforms in the next few days. So we are 30 minutes away from the European Equity market open. Lets get a quick assessment of what the story has been in asia overnight. Zeb eckert is in hong kong. The shanghai composite has really been on a tear this morning based on this story we have been discussing. Zeb absolutely. It is not just any m a story, but a major merger of two shipping titans. Hina major and cosco speculation in the market that, as push as part of a push to consolidate, china will merge these two companies. The two companies were suspended in trade today in hong kong. All of the related companies, companies they do business with, rallying. Market inhare shanghai, contributed to a 5 gain. Stocks just taking off. We saw terrible Economic Data over the weekend from china. Exports were five times worse than expected. Price data not coming in in line with expectations. Yet the shanghai share market is advancing. Part of that is also due to the expect morevestors stimulus as the chinese try to prop up market. That is positive to investors who have been rattled by volatile markets. Elsewhere, this is what we have. Southeast asia firmly in the red. A lot of concern in malaysia given the political turmoil there. Take a closer look at the handling of funds by the countrys leader. Foreign investors have been pulling out of the market and the ringgit has been moving as well. Vietnam showing some positive signs. Comments from the central bank in philippines saying that Monetary Policy is appropriate in hong kong. Basically a flat market. The China Enterprises index swinging between gains and losses. Casino shares doing well. Sams china up. And it sands china up. Kashing, his flagship company, which does have significant exposure to china, down 2 . I want to give you a sense of which shares in the shipping space we are tracking today, because they are the key market movers. Investors cannot seem to get enough of these. These are the names. China shipbuilding, China International marine, many of these have hit their daily limit. Overalls driving this market optimism despite dismal economic nubbers. Go figure. Caroline the best today rally in a month. Twoday rally in a month. Guy European Equity markets look like they will open on the front foot at well as well. Looking to ftse 100 be up around. 6 . Looks like the dax will open up 1 . After af fall. Ne twoday the Federal Reserve might be hiking rates in september. Manish is still with us. Also joining us is gareth mccartney. He has more than 14 years in Investment Banking and has been involved in over 200 equity Capital Markets transactions. Give us a sense of what sentiment is like . Area, are they worried about growth . What is the feeling on the ground . I think the feeling is generally constructive. Another good year in terms of issuance. 180 billion of new paper that has come to market in europe this year. Generally, confidence is good. There are a number of drivers. M a is one. M a. Talk to me about the Berkshire Hathaway, warren fett potentially making it a major acquisition of it how much more are we going to see. Have noturprised we seen more . I think it is still the early stages. You have a weak euro and that is attractive. Foreign countries coming into europe. I think confidence is up as well now. Caroline what are you feeling about m a . Are we going to see this continue into the second half . I agree with what he is saying. If you look at the cash on the Balance Sheet, if you are looking to locate earnings, you just go and buy some more earnings. Growth is lackluster. In the eurozone, barely over 1 . Buy a are able to company, of course, you go and buy that. One of the big things this morning is oil is down. Why havent i seen more m a in the oil sector . We have not seen that much does fark considering how far oil has fallen. You want to know what the Balance Sheet is like of the company you want to acquire. ,hat we have seen recently people are just producing more and more and more. There are two things that stand out for me. The oil price and then you have qe. Money,did not have cheap he would not have so much government reeling into shale. Petroleum darko petroleum, they mentioned they are using one rig and they have doubled the productivity. What is happening is that even as the oil price has gone down, you are seeing more to create the same dollar value. It is coming back to the company. Some of these producers have hedged their oil prices. You are not going to see them capitulate. The oil capacity will continue. At some point, you will have some m a. Caroline talk to us about sectors from your perspective. Are you seeing Oil Companies assessing the equity market and whether they should be raising capital rates . It is early stages in that sector. 2012, whenack to equity markets reopened in europe, it started with yields in the big driver from investors. Have seen a general pickup in growth and moved through different sectors. Last year was about the recapitalization of the bank sector. This year is a much more Progressive Agenda with m a in the background. I think what Equity Investors want is growth. We need to see that visibility and competence with Commodity Prices for that sector to pick up. Ceos acrosstheboard, when Investment Bankers come and see them, what is the reaction . What is the feeling from the . Oardroom about these ideas are they receptive or nervous . What is it like at the top of the company . Confidence has significantly improved. You are seeing that in share prices. Also, the ceos raise equity for m a and that has been received well by the market. That brings about a broader restructuring agenda. Caroline what about the fed . Anish is saying he is factoring in september as a go. Rate rises, where does that factor in . This story of the european rally we had seen has been fundamentally a liquidity story. That is driving equity markets. That has seen a big multiple expansion across the board. I think we are going to see that in the u. S. Before europe. The real engagement of u. S. Investors into europe has been a big theme over the last 1218 months. I think that continues. From my perspective, i think it is more a u. S. Story. From a european perspective, you will have a lot of u. S. Capitol coming into europe and we need to see european earnings picked up. Guy a huge premise, though. I have heard various people tell me that, if we do not get that earnings story, you need to fundamentally reassess the way you look at european equities. It is almost a given it is going to happen, but should it be . I think you are right. Over the years, we have seen expansion. Only this year, you have seen the earnings really coming through in terms of numbers and expectations, which are much higher this year. For the next six months, you are right. We will be putting far more stress on earnings. There is a big question. There is no doubt about that. If you look at the amount of credit flow going into the economy, which was not the case last year, we have seen from the bank lending sector and cheap oil. You are seeing the numbers change. That gets very positive and we see that on a quarterly basis coming from the ecb. , andnk the ground reality there is some groundswell, should be the earnings. If they were not to come, then there would be questions. The last two quarters have seen the material pickup in earnings. Caroline geographywise, are you seeing countries having companies that much more accelerated and wanting to come to market . Going from recovery to growth , we have seen a lot of issuance coming from southern europe, greece be spain, the next phase will be northern europe, industrialized growth. Guy when you look at how this recovery is going to take place, how relevant to previous recoveries is this going to be an incredibly weak recovery . Give us a sense of what this is going to look like. Happened in the past. Are they going to be disappointed . From a primary market perspective, i think we are now back at pretty much 2007 levels. If we take the Component Parts veryat, the ipo market was much in restocking phase over the last couple of years. I think i would define it now in a much more normalized environment. Down you run year volume wise, but i think the quality and sustainability is good. So reasonably optimistic in terms of the outlook for the ipo market. More broadly, looking at what private the Equity Companies have got to do and looking at governments deleveraging their Balance Sheets, feels like there is quite a bit of visibility for the next 18 months. Caroline thank you very much. Manish, we are going to be bidding you well. Great to have you on. Gareth, you are staying with us. Coming up, we will bring you the latest on those attacks in istanbul. Guy car bomb at a Police Station and a gunman opening fire on the u. S. Consulate. More on that story when we come back. Guy welcome back. 7 47 here in london. One hour more in paris. We can do the math. Caroline lets take you to the top stories you need to know this morning. China is considering combining China Shipping group and Cosco Shipping group. The two companies were suspended after more than 10 gains. Slowing demand for chinese goods. Xports dropped 8. 3 we were expecting a decline of 1. 5 . The Chinese Market is up today because of the first headline. Governmenthe greek aims to conclude talks on its third Bailout Program by tomorrow. The timeline leaves enough time for the National Parliament to pass the deal and release the funds for the 20th payment to the ecb. The euro area finance minister meeting will be held at the end of the week if greeces Parliament Passes the necessary reforms in the coming days. Guy a series of attacks taking place in istanbul. Lets get the details of what we need to know on this story. Elliott gotkine is in the studio with us. We first started hearing about this about 2 00 a. M. Give us the evolution of what has happened since then. Elliott looks like we had two separate attacks taking place here. One is a bombing of a Police Station, in which five Police Officers were wounded and a couple of civilians as well. Subsequently, one Police Officer has died. Im not sure if it was one of those Police Officers who was wounded or perhaps in subsequent incidents as well. Apparently there were two gunmen who opened fire on the u. S. Consulate in istanbul. Security forces immediately returned fire. And sinceants fled then, we heard that too assailants have been killed by Security Forces. This is an ongoing situation. Certainly, a continuation of the upsurge in violence we have seen in turkey. Perhaps related to Islamic State. Of course, the u. S. Warplanes launching operations from turkeys southern airbase over the weekend, perhaps related to the upsurge in violence between the Turkish Security forces and the kurdish militants. Caroline talk to us about ramifications of erdogan. What position does it put him in . Isare seeing how the market digesting this. Actually, there is not too much beer. Thoughts are of this morning. Elliott we saw a reaction on the turkish lira as well. Political instability is the backdrop right now in turkey. We had those elections, which did not lead to an overall majority for the ruling akp, dogansnt argued er party. We may get fresh elections in turkey, which assumes president erdogan would like to see the predominantly kurdishsupported Party Winning representation in parliament. All of this is playing into the calculations of what is going on right now. We had a suicide by me bombing in turkey last month. That seems to have pressed the turkish government into action in dealing with Islamic State. At the same time, they are launching attacks against kurdish militants as well. From sitting this one out, if you would like, turkey is now effectively back to fighting on two fronts, one with kurdish militants and one with Islamic State. Guy is it true that the attacks this morning we were talking lea about this earlier, may link to the use of u. S. F16s out of turkey . Elliott you could say it is a coincidence. Maybe it is. There are a number of groups in turkey who could be responsible for the attack on the u. S. Consulate and the Police Station. I suppose the one certainty in all of this is this is probably not the last of this kind of upsurge in violence that we are seeing in turkey. Guy thank you very much indeed. Gareth mccartney is still with us from ups ubs. We have got chinese stock markets up from m a. We have what is happening in turkey taking place. I am not going to draw conclusions and try to link these two heavily, but what heavily, but what happens in the markets that you deal with over the next 12 months . Give us the picture. If you take broader issuance across europe, it has been strong because we have enjoyed a volatility. Beening markets have challenging due to the emergence of rate hikes in the u. S. And markets starting to factor and price those in. I think, given higher volatility and a rate rising environment, i would imagine they stay depressed over the coming months. Caroline how much is there an fx play when it comes to your syndicate . The bond syndication, an uptick in u. S. Companies coming to europe. Of course, the u. S. Dollar strength. Would that play into the equity side of things as well . Absolutely. With the liquidity story you have seen with qe in europe and a weak euro, you are seeing that as a compelling proposition for u. S. Investors looking in europe. I think that will be a factor. Guy give us a sense of how positive you are relative to two or three years ago. When you are discussing in the office, what is the feeling . It is different from three years ago. What we have enjoyed is initial recovery, the beginnings of the market reopening in europe back in 2012. That was very much quality yield. That was the key argument. Now when you are talking to investors, it is a much more appropriate agenda and you are seeing different regions and sectors opening up. Caroline how many billions will we have in the end . Will this be a record year . Everything is set up pretty well. We are trailing where we were last year. I think the visibility between now and year end is greater. We had quite a challenging october and november that effectively closed the ipo market. This year, there are three or four multibillion ipos we are expecting in europe. A lot of opportunities to have a strong finish to the year. Caroline thank you very much indeed. Markets aren equity called to open around. 5 higher this morning. Jonthe move, posted by ferro. Jonathan shanghai stocks surging this morning despite weaker data that did not present worlds picture of the secondlargest economy or any kind of recovery. We will talk about the data and the speculation that the government will accelerate mergers of dateowned enterprises. A lot to talk about. We will do that as the market opens in europe. Later on, we will talk about war rens new target. Berkshire hathaway in what could be a 13 billion deal. It is about reshaping Berkshire Hathaway is self. A lot to discuss. Later in the show, we will break number. Jobs a decembero make vote a september vote, but a big discussion. Tom keene sits down with vice chair of the Federal Reserve, stanley fischer. We will look ahead to that. Caroline thank you very much indeed. On the move is next. That is it for us on countdown. Stanley fischer conversation is one to watch as well. Jonathan good morning and welcome to on the move. Im Jonathan Ferro at bloombergs European Headquarters in london. Lets get straight to your morning brief. China stocks surge. Expectations grow the government will accept mergers among state owned enterprises overshadowing weak Economic Data. The greek government wants to wrap up talks on a rescue program by tomorrow, leaving enough time for National Parliaments to assess the agreement. Berkshires new pursuit. Warren buffett said to the close to buying decision car parts for close to 1 billion, one of his biggest deals ever. They are just three of the things ill be talking about through the next 60 minutes. Ftse futures in the green. Dax futures up 0. 5 . Will it be a higher open . Lets get the market open with caroline hyde. Caroline two days of a selloff on the stoxx 600. We are likely to see stocks get that nudge higher, shrugging off the data we saw out of china over the weekend. Exports down more than 8 . We are seeing worsening producer prices, but still m a speculation in china, speculation of more stimulus to come. It might be helping feed into the ftse 100. Cac 40 up 0. 5 . We will wait for the ase in greece to open. Will we get that deal signed off today for 86 billion euros bailout package . Can the imf, ecb, european commission, and european stability mechanism managed to