Transcripts For BLOOMBERG Countdown 20240622

Live from bloomberg studios here in london, i am anna edwards. Lets remind you what an amazing 24 hours it has been. We still have the Chinese Market falling as we said in our headlines. Lets put that into broader context. U. S. Futures, looking ahead to where we are heading in this. Tory perhaps things looking a little bit more positive as we move towards the morning. This is what the futures tell us at this very early stage. It says what we expect to see in the u. S. Market a little bit later on. Theyre in mind that we saw some stubs some substantial selling, the dow jones closing down by 3. 6 . The s p 500 down by 3. 9 . What a roller coaster ride it has been over the last 24 hours. We saw corrections on the s p. That particular index down by 3. 9 on monday. Andes of 7 over two days at one point in the trading day, down more than 10 from their highs in may. Lets put the trading day in the u. S. In some context for you. What yesterdays session meant. Insaw the measure of stress the market get so jacked up. We saw a Large Technology stocks correcting within minutes. Perspectiveat in with a report from the u. S. The s p 500 falling into correction for the fourth time the first time in four years 7 today capping a twoday slump. Grexit u. S. Market got crushed after bad markets in asia and that markets in europe. The Dow Jones Industrial average down more than 1000 point. The s p 500 down more than 5 . Those indices started recovering throughout the day. We were feeling fairly sanguine around noon, when the dow was only down 100 point. It had recovered more than 900 points of its drop. The s p was only down 1 . Throughout the day, things worsened as margin calls forced investors to sell stocks and raise liquidity. We had the dow closing down at the end of the day 580 points and s p 500 closing down 3. 0 . 3. 9 . A drop of more than 10 for the first time in five years. Orsons early 2011. The same story held true for individual stocks. Some of the biggest that we watched for example, General Electric fell 21 at the open. It recovered to a loss of only 2 by the end of the day. The same is true with apple, which fell 13 at the open and closed it down 2. 5 . Matt miller, Bloomberg New york. Mark anna that is how things look yesterday in new york. Lets get to caroline. She is looking at the broader picture across the asian market. Things looking a little bit more ,ixed from yesterday, which is in itself, a positive. Caroline i think the storm is still brewing in china. Shareses of the chinese still feeling the hit. It looks as though we are starting to see a little bit of calm when it comes to the rest of the asian trading. Japan was just turning lower, but we have not seen the selloff that we had yesterday. If you are looking at where we are looking for europe and the u. S. , looks like there could be a few rays of sun for europe. We are likely to see the dax up about 212 point. That is the first call i have from London Capital group. I will show you what u. S. Futures are doing at the moment. The dow jones adding about 2. 4 . U. S. Futures likely to rise up to the dow jones yesterday, phenomenal. We actually saw it off more than 1000 points, the biggest move in history. Bigger than the flash crash and the dog days of the financial crisis. U. S. Futures pointing higher. I want to show you what happened on the stoxx 600. Every single Industry Group was lower. Minors off more than 9 . The real pain being inflicted. We saw every Industry Group falling. We saw the dax into their market territory. 20 off previous highs in germany. Now we are starting to see a turnaround. The irony is the fact that the euro was seen as the haven more so than the swiss franc, the pound, the dollar, and the yen. Today comingnow down slightly, coming off previous highs. People now recalibrating. Where are the fundamentals . Already, i am here in j. P. Morgan analyst saying this is a buying opportunity. The fundamentals do not really a line them align. Raymond james saying look at local, growthdriven european stocks. Of course, the retailers come to mind. Euro area growth is still set to be the best since 2011. We are set to see profits rise 6 this year. That the selloff that you see across germany, france, and the u. K. , there could be some bottom picking today . Certainly movements out of the euro, which has been seen as a haven. Back to you. Anna thank you very much. Caroline looking at the session that is underway in asia. As the european and u. S. Markets plunged, investors looked east to china to stem the route triggered by the Central Banks evaluation of its currency on august 11. I am convinced that china will do Everything Possible to stabilize the economic situation. China is an important partner of the European Union. Mohamed elerian joined calls for the intervention from Chinas Central Bank to support the market. We need that external anchor otherwise, prices will have to go down a lot more to bring in buyers with conviction. Fedrtunately, it is not the or easy bp this one is different. The source of this dislocation is from the emerging world. What you need is something that stabilizes the emerging market over there. That means china. Anna so have the chinese been listening . The peoples bank of china has auctioned yuan in sevenday reverse repurchase agreements according to a statement on its website. This is after recent currency market interventions to prop up the yuan has strained the Financial System. Lets get more on that from hong kong. Explain to us what it is the chinese authorities are doing. This is trying to remedy some of the perhaps unforeseen effects of the currency devaluation earlier this month. Exactly. Good morning. It is a balancing act for the Chinese Central Bank. On the one hand, they have to intervene to buy this yuan to make sure it does not depreciate too much. They exchanged their Exchange Rate regime a few weeks ago and sent shockwaves through the markets. By intervening, they are taking money out of their own Banking System in china. That is putting pressure on money market rates. That is not what the pboc monster happened. On the one hand, they are buying the yuan. On the other hand, they are pumping money back into the system to keep a lid on Interest Rates. A bit of a tricky one for the pboc as they navigate the new world after the big change they made to the yuan a couple of weeks ago. Anna can policymakers turn things around . What should we expect to see from the pboc, from policy makers in china in response to what is happening . Will they cut Interest Rates, try to stimulate growth in the economy . What kind of tools are they playing with . It was interesting to hear Mohamed Elerian for the focus on the Chinese Central Bank to act. They have done a lot so far, but needs to try to get growth going again. They have not had much bang for the buck. Much traction. Ad Going Forward, they have a number of tools left. The question is how effective they are. The pboc could cut Interest Rates, take steps to encourage buyers to lend more into the economy through the reserve requirement. Of course, the government could. Tep in again they could add more support if they wanted to. Of course, for the macro side of things, they could ensure more fiscal stimulus into the economy. The question is whether it will work. How is the rest of asia reacting . The rest of the stock markets, a more mixed picture coming through. The Chinese Market is still considerably weaker. Things look more mixed elsewhere. A number of these countries have deal with the effects on their own currency of what the chinese did just a couple of weeks ago. How is the rest of asia reacting . That is right. The most interesting comments came from the japanese finance minister, who went for direct criticism of china and their actions in the stock market and their currency. He effectively pinned some of the blame on them for causing so much dislocation. That is quite interesting to see. Japan has been running their own program of qe. It may speak to an underlying sense of tension in the region, concern that there might be a race for competitive devaluation. They have devalue their currency, the dong. There has not been other too much explicit criticism of china yet, but it will be interesting to see. Wars i wonder if currency will be back on peoples lives. Thank you for joining us with the latest on what the chinese authorities are doing here. That brings us to our twitter question of the day. What should beijings next movie what next move be . Act in terms of what they are trying to do to the currency, but is that enough for you . Do you want to see them do more to support equity markets . Do you want them to do more to support the underlying economy . Highlighted the options that are Still Available to the central bank in china. It is 12 minutes past 6 00 in london. Coming up, the worlds biggest mine reports earningsr in just under an hour as Commodity Prices hit 1999 lows. We look at what could be the bottom line when we return. And an interview at the with the man at the helm of the company. He will be on Bloomberg Television later in the day. Stay tuned with us for that. Anna welcome back. Yesterday saw 2. 7 trillion wiped off markets around the world. Here is how some of bloomberg tvs guests made sense of this. I certainly would not be a buyer today. Shortterm, this is a panic. This is a shortterm, painful correction. People had a genuine hard time sleeping last night. It is not something you want to step in front of. This has occurred at the beginning of a bear market. It is a signal that something is very wrong. The fundamentals really do not warrant this. These rapid moves in prices are not matched by changes in the underlying Intrinsic Value of the businesses themselves. Central banks have been pumping up asset prices, Commodity Prices, equity values. You keep pushing them up high enough until they get into thin air, they are bound to correct. It is a healthy correction. No correction is healthy. Have not had a correction since 2012. We were due for one. It is the kind of thing the markets go through every once in a while. Unless you believe the chinese economy is bad it is going to put the Global Economy into another recession, i do not think it is likely we will he a 20 correction on the s p 500. Change inhe rate of price versus Intrinsic Value, it is more of a buying opportunity than anything else. People who say they want to buy, i just wonder if they still have money. You want big balance sheets, resilience. Second, you need wellmanaged areas and second, just third, you need to be in a forwardlooking industry. Active investors will be very excited once the smoke settles that there is a lot of value being created. Anna we have more of that allianzchief economic advisor. The time in london is 6 18. It is 7 18 if you are watching in frankfurt. Here are the stories you need to know. Most asian markets have been bouncing back after yesterdays selloff. Australia are in green territory. However, the shanghai composite remains in the red. Oil climbing more than. 5 . Isnas central bank injecting around 23 billion into the Banking System today using sevenday reverse repurchase agreements. Traders will be bidding at the auctions. Recent currency market interventions to prop up the yuan has has strained the Financial System the standoff on the Korean Peninsula is over for the time being. North declaredhe a semistate of war and the south said it would stop broadcasting propaganda across their mutual board of the monsanto, the American Company that provides Agricultural Products for commerce, has increased its takeover offer for syngenta. Caroline has more details of this bloomberg report around the latest offer. Caroline according to people familiar, we are going to get an upped bid as soon as today. Here are the numbers you need to know we understand it could be as big as 47 billion. That is 15 higher thans syngentas than current market cap. The overall price tag is 5 higher than monsanto had previously been offering. This deal has been going throughout the year. It was back in may that they were initially refuted by syngenta, feeling that the deal was not quite big enough. There are some other changes to the deal. The breakup fee has been raised to 3 billion and also, more cash. It used to be 45 cash. Now the cash portion could be up. We are looking at what is driving this deal and why monsanto is willing to pay up, looking to pay the premium. It is about becoming the biggest player in the market, the Largest Global producer of crop chemicals. They are trying to look for consolidation as we see market demand wane slightly for these products. We are also seeing the demand widen in europe. Getting into syngenta would open them up in terms of geography. We also have to look at the challenges, why this deal might not go through. Challenges . The challenges are regulators. Of course, politicians. And interestingly, those worried about the environment. Influence over agriculture would be second to none. It would be the biggest payer when it comes to the kinds of pesticides that are being used. It is known for the wide use of genetically modified organisms. That is something that perhaps does not sit well with many environmentalists. And if you politicians. Monsanto has said that these are safe and can help in terms of being in the amount of goods bringing the amount of goods we need to the world. Slight negative backlash coming to gmo types. Monsanto needs to convince regulators that they will continue to thrive within the market. In of course, with turmoil the Financial Markets, can they lineup that financing . It is an interesting time for such a big m a to be taking part. Surely a driver for consolidation as waste as we start to see demand start to wan e. Anna lets turn to commodities. Yesterday, we saw prices slide to 16year lows. The Commodity Index has 22 materials, from oil to metals. Miners tanked. We have bhp billiton earnings in about an hour. For more on what we can expect, lets talk to colin hamilton, the global head of Commodity Research laboratory estimate for it at macquarie. It seems from your commodities perspective, the data you have had in the commodities four d gives you a sense of how much we need to worry about china. This has been going on for a while. Read it growth, making sure growth does not get any worse. Commodities are doing well. Gdp in China Growing 20 plus. Now we have the rnb depreciating. 36 has been negative for months. Gdp growth of only about 4 . China is not falling apart. If anything, imports are picking up again. Highfrequency china is starting to improve. Particularly the expectations of fiscal stimulus. On the whole, markets are structurally oversupplied. Equities are not pulling their weight either. Where do you expect the Commodity Markets to head. Do you think the most that what we have seen has been overdone . China is not falling apart. What is it, 16year lows western 16year lows . Pricing like it is 1999. Anna the chinese economy is not back to where we were in 1999. Does it make sense . Neither is demand. As the growth starts to wane, chinas ability to push out across all commodities is this inflation rate. We have moved into reporting season, where we have not seen supply cuts announced. The commodity market still needs aggressive supply cuts from producers in order to bring back into balance. We still have oversupplied. Oversupply. Nothing changes the fundamental week driver around the commodity space for you in the short term. Your economist has been talking about, with the government ramping up infrastructure, the economy might stage something of a turnaround in the fourth quarter. We expect you on your demand growth rates to be improving the most in the second half of the year. But it is coming off a weaker base than we would have asked acted. Expected. Would have we expect that to get back to you on your parity year onyear parity. Even if we are expecting china to help stabilize Commodity Prices, that is probably the best for the short term. Where a you look at change comes, whether it is from the chinese or from the fed, maybe you zone in on the dollar and see where that goes. The link is well known between the dollar and the Commodity Markets. Explore all of that for us right now. Of course, the trend of the past year has been stronger dollar. That is a trend we have seen over many years. What we have seen his expectations are being pushed back. Challenge in the moment is still in emerging market consumers who should be helping at the current time, still worried about the turmoil. , you getrrency moves less decision paralysis. I think we have decision paralysis or the industrial economy. Anna great to see you. Back in a few minutes. Get excited for the 1989 world tour with exclusive behind the scenes footage, all of taylor swifts music videos, interviews, and more. Xfinity is the destination for all things taylor swift. Anna welcome back. You are watching countdown. Here are the stories that you need to know this morning. Most asian markets have been bouncing back this morning after yesterdays selloff that white 2. 7 trillion off Global Market value. And australia are in positive territory. The shanghai composite remain in the red for a fourth day. Oil climbing more than. 5 from sixyear lows. Chinas central bank has injected around 23 billion into the Banking System today using sevenday reverse repurchase agreements. That is according to traders who will be bidding at the auctions. Recent currency market interventions to prop up the yuan have strained the Financial Systems supply of cash. Monsanto has made an increased takeover offer for syngenta. That is according to people familiar with the matter. After its earlier approach was offered, monsantos new values the company at about 47 billion. Lets get more on what is moving in these markets. Caroline hyde is that the markets desk for us. Caroline we are finding ourselves up for a little bit of calm after the storm. After seeing what is happening in china, the calm has not quite hit china. The rest of asia is showing a little bit of a reprieve. Still, the shanghai composite remains lower. We are off by some 16 over the course of three days. Clearly, the pain is still being felt in china. Still no stepping in by the chinese government. Still no cuts to the reserve ratio requirement to help push more buying. They have been allowing Pension Funds to start buying equities. None of this is stopping me rot when it comes to chinese stocks. But there is more in the market when it comes to hope and optimism for the futures market and the u. S. We are still trading up about 1. 7 . He are looking at the dow jones, the s p 500. Yesterday, we saw the biggest selloff since 2008 in the midst of the financial crisis. The dow jones, at one point slumping 1000 points in under seven minutes. That is the biggest moving history. That is more than the flash crash in 2010 and the dark days of 2008. We will wait to see european futures open, but we are already seeing calls for the dax to rise. The dax entered a bear market yesterday, 20 off their highs. This is what happened yesterday. 9 fall when you are looking at the minors. Miners. The worst move we have seen since 2008. Every Industry Group falling on the stoxx 600. The pain was evident. Interestingly, so dark did it get, the irony that the europe suddenly becomes the euro suddenly becomes a haven. It is up 4 over the past few days versus Major Trading peers. We are seeing is doing better than the dollar, the yen, the swiss franc, the pound even. A bit of a recalibration. Indeed, we are seeing the fastest growth in the economy since 2011. Jpmorgan says it is time to buy. Anna thank you very much. Germanys revised gdp is due out in just under 30 minutes. Amid concerns about the german exposure to china. Nichols is hans standing by for us in berlin. How exposed is germany to this slowdown in china . Hans good morning. There are two ways to look at it. It is the biggest trading partner outside of europe, but it only accounts for 6. 6 of exports. It may not affect it that much. Angela merkel felt like she had to weigh in on it last night. She said that she was confident that authorities in china would try to stabilize the situation. I am convinced that china will do Everything Possible to stabilize the economic situation. China is an important partner of the European Union and we are in close contact with them. S the dax showed quite a bit of pressure yesterday. It had a late rally, what ended the day down 2. 7 . Then you take a look at what is happening in terms of the trade deficit between china and germany. It has already doubled. This time in 2015 is what it was for all of 2014. Clearly, some movement there. When you look at individual sectors, the auto sector, we see a little bit of divergence. Sales defied expectations. They were up 42 . That is the daimler side of the story. We have had audi talk about revising the forecast. Same with bmw. Daimler sort of writing this out. This out. Bmw, they are of only 5. 8 . And then audi basically staying flat. Audi is the one relying most on their sales in china, so in some ways, we have to look at this sector specific as well. Anna it is not just the gdp data that we have later today. We will also get the latest numbers. Mbers ifo how do we think that german business is feeling now . The estimate is for 107. 6. Last month, it was 108. The gdp numbers, we get those in about 20 minutes. They are revised. It will give us a little bit, but will not capture all of the china slowdown. Most of that has happened in the Third Quarter. The ifo is more important. That is the one i will be looking at today. We saw german factory growth accelerate at the fastest pace in more than a year. That was an interesting number coming out on the market economic side of thing. Ifo comes out at 10 00 will time. We will have that as well. Anna thank you very much. Hans nichols with a briefing of from au need to know german perspective this morning. Lets continue our conversation about germany and the link between germany and china. Lets talk to sarah, Standard Chartereds chief european economist. Great to see you. Lets talk about germany. Setting out for us the link between the two countries and just how exposed the German Economy is to a slowdown in china. How much weaker do you expect it to come through in germany . We have to remember that although china is important and an important export destination, and endt the be all all. The signs we are seeing from germany are reasonably good. Lets wait to see what the revisions say later this morning. Overall, we are looking at an economy which is being driven by strong domestic demand, consumption, investment year on year performing well, and net exports are picking up. Overall, domestic demand and what is happening to the consumer is more important to germany at a moment than what is happening to international markets. Anna when we have talked about the strength of the german model in the past, we have talked about how they have been since hustle in exporting highend manufactured products into the Chinese Market. They have been very successful at doing that. We have question the sustainability of that and the driver there of the economys growth model. It is true that when we look at German Growth, we traditionally expect it to be driven by exports and investment. Weather has been a sea change over the past 12 months. Particularly household spending. The part of the economy we do not normally think about when we think about germany. It is becoming a lot stronger. That is not to say that china is not important and that exports overall will not stay important for germany. We are still seeing some reasonable performance. Some of the car producers are seeing export growth to china. The chinese economy is still growing at three times the pace more than three times the pace of germany. That is going to be an important thing for cars to go from germany. Anna looking ahead to the ifo number, hans was setting out that the expectations around that you think we could see a move higher. We need to remember that just a month or so ago, germany was transfixed by what was going on in greece. Absolutely. This is going to be a key number. Second quarter gdp is backward looking. This number will give us an indication about what sentiment is amongst german producers looking forward. Think, is likely to be a little bit better than maybe the consensus expects. We think we will see a pickup in the ifo index. A continued rise coming on from july. The story overall is a positive one. We are looking for German Growth of around 2 for the year overall and sustained dynamics there. Anna i have on the charts the euro. This is the euro against the dollar, obviously. Amazing to see some of the gains we have seen in a single currency over recent weeks. Is this really a safe haven . This does not do well for any economy that is very reliant on exports, of course. Certainly not a picture that is going to make mario draghi very happy. It does represent a tightening of conditions. It is really related to expectations about what the fed is going to do over the last couple of days, expectations about the fed rate hike. We still think there is a chance that we could see the fed moving , but we still need to see what the data say over the next couple of weeks. , while itro position is not doing any favors to exporters in the region, it is still not too expensive in our view. The moment, you are seeing a september call for the fed. Barclays move their call from september 2015 to march of 2016. A number of economists seem to be reevaluating. You think there is still more that we can learn from the data before the september meeting. Lets see what happens to the markets. The fed members have made it clear that market volatility could be a factor which would encourage them to delay a rate hike. For the time being, it is still too early to say. I think the payrolls report is going to be extremely important. Overall, we see very buoyant marks in the u. S. The data suggests that the economy can withstand a hike in Interest Rates. But market volatility and International Conditions will be an important factor when the fed comes to making the decision. Anna thank you. Sarah stays with us for another 45 minutes on the program. We will return to her thoughts on the fed and what is driving china. Just a reminder, you can weigh in on our top stories on twitter. Todays twitter question is, what should beijings next movie be . Ext move more Interest Rate cuts, perhaps as jim perhaps . We will talk about that a little bit later in the program. What do you think . Give me your replies on twitter. Tumbledh african rand to a record low yesterday and stocks sank over concerns on plunging Commodity Prices. Todaysahead to what gdp figures will tell us about the state of south africas economy. That is next. Anna welcome back. You are watching countdown. Here are the stories you need to know this morning. Most asian markets have been bouncing back this morning after yesterdays selloff that wiped 2. 7 trillion dollars off Global Market value. Korea and australia are leading gains. The shanghai composite remains in the red for a fourth. Has oilodities rout climbing 1 from sixyear lows. Fallen belows have their ipo price for the first time. The stock fell more than 3 during mondays selloff. It was below its ipo price of 68. Of 119rging to a high last september, they have lost more than 122 billion of market value. Good news for millions of people in london. Tube strikes have been called out. Defended says it has the walkout as a gesture of goodwill. The workers are in dispute with the tube operator over plans to introduce a new night service. Our conversation with sarah, Standard Chartereds chief european economist. We were getting your thoughts on the fed. You were sticking with september, waiting to see what the data shows. We had one official speaking in the last 24 hours. He expects the first hike to come in 2015. He does suggest that some of the market moves we have seen in the last few days complicate the u. S. Outlook a little bit. Do you think the fed needs to wait to see if the moves in the markets translate into that wordlooking data before it changes its stance . Isi do not think that necessarily the case. If we go back to this time last week, before we have these dramatic global moves, i think a lot of people were quite comfortable with the view that the u. S. Would be hiking in september. The question is, what happens over the next couple of days . If we get a lot of further market volatility and further declines in stock markets around the world, that is going to have a negative effect on sentiment and the fed might feel that they need to pause for a bit longer. If that is not the case, it is going to be a matter of what happens in the u. S. Data. I think payrolls is going to be extremely important. If we look across the board, we are seeing signs of activity from the u. S. Economy. Equal, if else being we get stable markets, the fed might still feel it is time to. Tart the rate hiking cycle it will be a gradual and slow process. Anna Everything Else being equal. We will see how that goes. Just contextualize the move we have seen and markets a little bit. I just saw some comments that Larry Summers put out on twitter. , as in august of 1997, 1990 8, 2 thousand seven and 2008, we could be in the early stages of a very citrus serious situation. Is that the gravity of this situation that we face right now . Do you think that what we are seeing at the moment is comparable to the promise to those famous. In history . Periods in history . A lot of the imbalances that were at the root of the problem in those days have been dealt with. We are certainly seeing some phone or abilities vulnerabilities. If we take china, you can see that across asian economies as well, they are not growing as fast as they were at the time of the last crisis. So there are some risks out there. Overall, if we look at the underpinnings of the Global Economy, i think that is that we are in a more secure position. The u. S. Economy is recovering well. The european economy is recovering well. Europe in particular has dealt with a lot of the imbalances that were there in the runup to the eurocrisis. Remember that this is being sparked by a fall in the chinese stock market, which rose very sharply in the 12 months previously. Anna yes, it did indeed. Thank you very much for that. South africa releases exporter gdp data this morning. This is a day after the rent nd tumbled to a record low. With china its top export destination, what lies ahead . Vernon joins us from johannesburg. What can we expect from the gdp number that will be released later today western later today . Expect a gdp number of about. 6 annualized for the quarter. That would be the lowest rate of growth since a year ago. It really underscores the challenge that president jacob has inadministration reigniting growth in the economy. They are struggling with power outages, which has hampered output. Productivity problems with labor are making it difficult for it to grow. Even though the currency has tumbled 44 over the past five years, manufacturers have not been able to tap into those gains. Anna you mentioned the rand decline. It has not helped exports as much as it could. What impact is it having on the economy is on the economy . It is having a negative impact on the economy. Interest ratetwo increases by the end of the year, taking them to the highest level since 2010. That puts pressure on consumers and companies as borrowing costs rise. At the same time, the depreciation threatens to increase the interest paymentsr that the government makes on its foreign debt. All of this adds extra pressure on a country facing a 25 Unemployment Rate and the aspect of losing another 60,000 jobs by the end of the year. Head where does the rand from here . We have seen it fullback from those record levels fullback pull back from the levels yesterday. What happened with china and what happens with the fed . A lot also depends on what the central bank does to reignite. He growth on the economy there is focus on their National Development plan to reignite growth and get clear policies on Labor Productivity to boost the economy. Anna thanks for joining us this morning. Good to get your thoughts. Some of the look at top stories on bloomberg. Com right now. Kim joins us for a look at some of his picks. You informed me that there was a hashtag around the south africa story that is pertinent to the conversation we just had. Strongerthantherand. Anna strikes me as a lot of characters. It was trending on twitter because people were joking about the weakness. People would say, my body odor, stronger than the rand. Puts a global selloff record year for dealmaking under threat. He talked about the amended the m a boom we have seen in europe and elsewhere. Could be threatened turmoil in the markets. Are on track to maybe do 3 trillion worth of deals, maybe surpassed the 2007 record. In this environment, who wants to take another big deal . There are lots of outstanding deals that have not been done, particularly for stock. Are they going to get done or not . It is anybodys guess, really . Difficult to price anything when prices are moving around so quickly. Take us into the world of africas richest man and his plans around cement. It is interesting, particularly in the context of what we just heard is going on in south africa. One of the largest economies in africa. What happens there is going to be important to what happens in the rest of the continent. This is a story that we are thinking about cement as the new oil. When a continent develops, you are going to need cement. You are going to have to build bridges, dams, buildings. He is pushing headlong into cement, making a big bet on it. Prices, islow oil angola to develop . What is going to happen to nigeria . What does that mean for cement . Sarah, many people are talking about the rise of africa for a long time. For theyour expectation africa continent as a whole from here or south africa . Clearly, you have some problems with the weakness in the Commodity Prices in many african economies. South africa is struggling with weak consumption. The Electricity Supply problems that your correspondent talked about. And exports, around one third of its products are exported to china. This is a bad combination for south africa at the moment. For many countries, we should not forget that cheap oil is a positive. That is underpinning spending and economic development. Anna thank you. We will be back after the break. Abouto time to talk you how to build industrial robots that do not kill humans, but we will talk to you later on countdown. Anna china still falling. Stocks slump for a fourth day, the steepest drop since 2007. U. S. Futures help some asian markets climb, but it is a volatile trading session in much of the asian region. Monsantos 47 billion move. How the agricultural giant has upped its bid to lewis agenda to lure syngenta to the operating to the table. Welcome to countdown. I am anna edwards. A warm welcome to the second hour of the program. Lets talk about what is happening right now in these markets. We are just getting numbers through from the mining business. We are also getting the german gdp number as well. We will zone in on both of those. We have a reading of german gdp of exactly what was expected. Lets talk about the mining , their numbers out right now. Caroline hyde has the breakdown for us. An interime have dividend coming in at 3. 1 cents. Capital expenditure is coming in at 22 Million Dollars overall. First cap revenue of 1. 8 billion. Earnings coming in at just half of that, 562 million. They are seeing a dividend much less of what has been expected. The estimate was six cents and they are seeing half of that. Gold,re a big provider of copper, and the likes. This is a company that has seen its share price smashed over the last 12 months, down some 33 over the course of the last 12 months. This is also a company that is feeling the effects of the rout and lacking demand. The china slowdown slowing demand for copper, metals. China is your number one metals demander in the world. When a slowdown starts to happen, it is hitting the minors the miners. We are likely to see the same for bhp billiton. Those two are focused on costcutting to preserve dividends. The dividend coming in of at half of what had been expected. Guidance will be 665,000 tons per year. Overall, the market might be disappointed by the dividend. Very much. You lets get reaction to gdp figures. We just had those gdp numbers out from germany. So gdp for the Second Quarter, this is a revision to the number we already thought we knew. The expectation is exactly what we have got from the German Economy. 1. 6 . Ar on your numbers, nichols is in berlin. Were an increase. That is important because its shows that the economy was driven by exports but held back by lower personal consumption and business investment. That is a picture of the Second Quarter. Remember, most of the negativity we saw happen in the first part of the Third Quarter. All of the china activity. That will do nothing to boost the export side. That will not add to business confidence. And it will not do anything to private consumption. In some ways, the Second Quarter snapshot of the economy says this is export. All indications are, the Third Quarter, we have had bad news. I expect the thirdquarter numbers will be even worse than the Second Quarter numbers because of a profile of what we had just got here now. We will be digging in more to see how much of various sectors have declined, what personal consumption has been doing, and so forth. My first look, it looks like exports drove the growth and the growth was disappointing and that private and personal consumption was a little bit disappointing. Anna thank you very much. What are the fears that chinas slowdown is going to have a big impact on the German Economy . This is backwardlooking to the Second Quarter. Merkel weighangela in on this last night. She said she was confident the chinese authorities would do something to stabilize the situation in you have seen the Auto Companies take divergent views. Audi has talked about how they are not going to sell as many vehicles. Daimler, the month of july, they were up 42 . For some reason, your cities are doing well and bmw and audi are not. It is germanys third biggest trading partner, but in terms of the export market, only 6. 6 of germanys exports go to china. There is a feeling that aside auto sector and some highend luxury products, it can write out what is happening in china as long as Global Growth days strong stays strong. That is why those negative numbers from france, where they had zero Economic Growth in the last quarter, that is perhaps more disconcerting to the German Economy. So much of their exports are eudriven, not headed towards china. The dax was down 2. 7 yesterday. There is an of for Angela Merkel to weigh in on it. Anna thank you very much. We were talking about m a and what the tensions in the Financial Markets might do. We are getting more news on some m a this morning in the insurance sector in the u k and switzerland. Ae u. K. Insurer has received revised proposal from Zurich Insurance group regarding a possible allcash offer for the company. That is some of the detail. Rsa shareholders receive the right to receive 3. 5 pence in interim dividends. The board of rsa has indicated to zurich that it might be interested. It might be willing to recommend an offer to shareholders at this level. Is inard of rsa discussions with zurich in relation to these terms. Interesting to see this deal being announced at a time when Financial Markets are so jittery. We saw such selling in yesterdays session. We also have the monsanto and syngenta deal that has also been increased. We will return to the subject of m a later on in the program. Lets check in on how the asian markets are trading. David ingles is in hong kong with the latest. David a good morning to you and i was supposed to bring you some good news. Then i had to rip my script up because things started turning for the worst in the last few minutes or so. I think the narrative of what happened today overall, we are down 1 . The markets opened much lower. Japan was down 4 . Up. Gs started to turn the aussie bank started to be bought up and the yen started to weaken. There was a sense that there was a little more risk appetite. Over the last 30 minutes or so, japan, which was up as early as about 1. 5 hours ago, it started to turn back 4 . That is what is happening to the shanghai composite. That is dragging down the hang seng index, which was up over 2 at one point. It is a fairly mixed picture. Japan is heavily weighted when it comes to a regional benchmark, which is why we are down 1 for that mark. Let me show you some charts very quickly. The session in japan was driven by the japanese yen. About 1. 21 to at the dollar and we woke up and it was about 1. 18. That is the session for the japanese yen. When it started to weaken again, that is when people started to think now is the time to buy the japanese market. So me just get this for you i can describe the narrative better. There you go. About 90 minutes into the session, the yen started to weaken. It is coming back down now. People started to buy the japanese equity market and things went back down. We are now down 4 . It is a very topsyturvy session. 17806 is your closing level for the nikkei. Go, noickly, for i Market Report would be complete without what is happening in the Chinese Market. 3000 now, psychologically important. We are trying to break this down. You have about 1100 stocks on the shanghai composite. It should be below 3000 right now. Let me update is for you. The 1100, 1200 stocks on the shanghai composite, about 950 stocks are lower. We are seeing a lot of volume everywhere else. Domestic investors waiting around for what the government will do. , earlier in the session, injected about 24 billion into the ecosystem. A lot of that going to offset some of these maturing repos. Lets see what happens here. We are down 6. 6 . 815 yesterday. Things are not looking good. This is a market that matters a lot. Back to you guys. Anna david ingles reporting in hong kong. Lets talk about what is happening in china and the global shadow that is casting. Sarah, the shanghai composite fallen below 3000 just a few moments ago for the first time in eight months. We have talked about how the chinese stock market, on the way up, was devoid reality and all the way down, possibly devoid of reality as well. What should policymakers in china be doing . What levers should they be looking to pull to support the chinese economy . They should not try to kickstart another big credit boom. I think the next move on the agenda probably is a cut to the required reserve ratio. We expect that we will see a move on that very soon in the next couple of weeks. Anna not an Interest Rate cut though. Other developed world economies are at 0 on Interest Rates. They could cut further if they wanted to. That is a key thing to remember. They have the scope to do further stimulus if they need to be we do nothing we will see another further cut in the benchmark rate. We think the target will be the rrr rate cut over the next couple of weeks. China hasing is already cut Interest Rates. They have already done a certain amount on the physical side. There is still scope for further targeted lending and encouraging fiscal stimulus which would underpin the economy. The story is not great, but it is an economy which is still 6. 5 7 on an annualized basis. Anna why not cut Interest Rates when inflation is not something they need to worry about too much . Certainly, the Producer Price numbers have been driven for some time. Why would the chinese not want to cut Interest Rates . Would it threatened to reignite the bubbles of the past . That is the key problem. If you cut Interest Rates and restimulated credit growth, you potentially push the economy into a higher debt situation. Already, we are looking at relatively high debt levels for the private sector. A cut in Interest Rates my stimulate credit growth again to an unsustainable level. Anna thank you very much. Sarah stays with is longer on the program. That takes us to our question of the day. What should beijings next movie next move be . You can from your answer around what is happening in the chinese economy. We have had some replies already. Colin tweeting that authorities in beijing must focus on the economy. Coming up on the program, we will take a look at how emerging markets are faring as they adjust to chinas new normal. Those are the comments of our next guest. He is joining us just after this rate. Stay with us on countdown. Anna welcome back. You are watching countdown. Here are the stories you need to know this morning. Futures trading indicates european equities will rebound from their biggest lump since the financial crisis. Contracts on the euro stoxx 50 index expiring next month were fewbout 2 able a moments ago. The shanghai composite has extended his losses, all in below 3000 for the first time in its month in eight months. Monsanto has made an increased takeover offer for syngenta, seeking to draw them to the negotiating table according to people familiar with the matter. After its earlier approach was rejected, monsantos new offer values the company at about 47 billion. De beers is cutting diamond prices after a at reducing supply failed to increase demand. The worlds biggest diamond producer has dropped prices by as much as 9 . It is also allowing some customers to defer purchases as it cannot meet production targets. Chinas devaluation of the yuan is taking its toll on emergingmarket currencies around the globe. Simon,et a view of commerzbanks chief emergingmarket strategist. Sarah from Standard Chartered is still with us on set. Simon, great to see you. Thai authorities saying they might consider new economic measures next week. It just reminded me, all of the thating asian economies are trying to work out how they will respond to what the chinese did by devaluing their currency. Is a lot about domestic politics as well. Probably elections later this year. Thailand joins malaysia as the most exposed to china, together with taiwan and korea, which i do not classify as emerging markets anymore. They are the most exposed to china. This is the Worst Companies and you can have. High exposure to china on the commodity side and any pegged Exchange Rate that you might have. Anna do you expect we will see more devaluation of the currency . Someone was saying that china does not think it is devaluing its currency to increase competitiveness. Tell us why. Point fromaking this the emergingmarket side of things. Wantsand the chinese yuan to join the currency for the first time. It will be the first emerging markets currency to join. This is one of the asons why we are seeing this flexible as flexiblization of the Exchange Rate. It is moving into the stage where things start to move very quickly and you have to be on the reactive side rather than the proactive side. We expect to see the Chinese Central Bank and the authorities get one step ahead of things, to calm down markets in asia and globally. That essentially means moving on the rates, moving on the reserve requirement ratio. Anna does that ring true with your assessment . Do you see what the chinese have been doing as reacting cyclically to the slowdown in the economy and trying to boost the competitiveness of their exports or do you see it structurally, china trying to get in as a big homer a big Global Player on currency markets . Is this more of a structural story, china entering the fold, or a cyclical attempt at boosting exports . I would agree with simon. I think it is a structural move. The authorities are taking the long view here about how to reposition the economy, achieve Sustainable Growth over the long term. Of course, we have seen some kneejerk reactions to the stock market moves over the last few weeks and months. Some of those have not been as successful as the government would have liked. I think that the story is very much a driver. Anna to make a structural change, if that is what they have been doing in china, already people are nervous about the emerging markets fear. The timing is absolutely. Take the most illiquid months of the year, where everyone is essentially on holiday, whether you are an investor or central banker central bankers having to be called back from holiday and politicians as well. They must have done this for a special reason. We will find out in a few months why they chose this particular time, which is very interesting. The chinese have the best advisers you could possibly imagine. They have been trained all over the world. If anybody needs to be believed in what they are doing, it is the chinese authorities and their advice. Stay with us. Breaking news from chp. Caroline it is in this a miss. 6. 4 billion coming in for the full year. That is less than the 7. 5 billion that had been expected. It was already almost a slump by half in terms of their underlying profit. Clearly, this company is feeling the pain of falling prices. Remember, this is a company that is focused on four main areas of mining now. It is coal, iron ore, copper, and oil and gas. It has been taking significant in 2015. Ns they said they would have impairments to the tune of 4. 7 billion because of the changing in prices. They are getting lower grade copper and gold out of the ground and coal out of the ground and have had to curtail some of bringing oil and gas out of the ground in the u. S. They say nearterm volatility is going to continue. Overall, they say that the forecast for china in terms of steel demand is to be cut. In the longerterm outlook, they say China Remains intact. Is some buoyancy and optimism coming from bhp billiton. That the longerterm story has not changed, but the nearterm volatility is here to stay. . 62 is where we are coming in at. They check they say chinese demand is to be at 9. 5 megatons intimate 2020. They expect the volatility to continue. Capital expenditure will be down. This is what Andrew Mchenry has been talking about, squeezing the limit lemon. Trying to reduce your overall costs and preserve the dividend, which everyone relies on so much when it comes to these huge miners. It is a huge hit to their fullyear profit. 6. 4 billion is much less than expected, but the dividend is intact. Anna moore squeezing of that lemon perhaps required to stay tuned. We will speak with the ch the ceo of bhp billiton after those earnings. Lets get back to our conversation. We were talking about currency markets. Talk about the saudi case. We saw the move by kazakhstan last week. Many people were wondering whether other currency pegs were going to fall apart or be left by the wayside. Do you think the saudis will lose the peg to the dollar . It is definitely something that policymakers in saudi arabia is going to be speaking about this week and next week. Thatu look at the reserves are out there, including the , saudign wealth fund arabia probably has the least amount available to cover budget deficits. Admittedly, that is about 78 years of coverage. In this situation, it is something that Market Makers focus on. Anna you said that that compares quite directly with what the context and situation was the context and the kazakhstan situation was. Absolutely. Thank you very much for joining us today. Great to get your thoughts. Simon joining us from commerzbank. Sarah from Standard Chartered, thank you to you as well. Coming up on countdown, monsanto has had its eye on syngenta for some time now. We will be following that m a storiy. According to people familiar of the matter, monsanto has of its ed its offer. Will that brings agenda back to the table weston back to the table . Get excited for the 1989 world tour with exclusive behind the scenes footage, all of taylor swifts music videos, interviews, and more. Xfinity is the destination for all things taylor swift. Anna welcome back everyone. Youre watching countdown. Here are the stories you need to know. Future trading indicates european equities will rebound from their biggest slump since the death in the financial crisis. For thep around 2 shanghai composite has extended its losses falling below 3000 for the first time in eight months taking its fourday lost beyond 20 . Chinese Chinas Central Bank has put money into the Banking System today. Traders whording to have been at the option. Recent currency market interventions has strained the Financial Systems supply of cash. The standup on the Korean Peninsula is over after marathon talk to the north has agreed to lift its semistate of war and announce that it will and the south has announced it will halt propaganda. London, the tube strike planned for this week has been called up to the union has said it has suspended the walkout as a gesture of goodwill to allow for further talks. Withorkers are in dispute the tube operator over plans to introduce a new night service. On how the in now asian markets are performing. David is standing by for us in hong kong. Last time we spoke him at shanghai composite dropped below 3000. Avid we are now deeper below that. 7. 7 down. We were hoping baton things have restarted and to turn. Been closed for 30 minutes now. A big swing get. We are down 4 for this market. More or less where we started. We had a 4 dip at the start of the japanese session. Things improved erratically midday, and then since then, things have started to cascade down. Shanghai as i mentioned 7. 7 . You were talking about this injection of liquidity from the Chinese Central Bank. Roughly about 24 billion. The majority of that money gets upset because a lot of these repose are maturing are expiring. The net effect is not as much as the headlines suggest. This is what the pboc is really trying to do maintaining liquidity in the system. A lot of money has been getting out of chinese acids. Point, either the yuan gives or they have to keep injecting liquidity into the system. 2 weaker compared to yesterdays close. We are above the six plus 40 handle. Happy have things called down . It is hard to say. Get a sustained rally until the pboc and the fed come out and lay their cards down. We need clarity on where we are. Howive you an indication of far we are from stability, have a look at japan. When it starts dancing around in the shanghai composite, you know we are not on stable footing. 17,806. Down 4 . This is the market in focus. Are we above 4000 3000 . Taking these losses from just last tuesday or wednesday, 25 . A lot of people are waiting to see what happens and whether or not david in hong kong. Around. Dancing a strong yen a factor as he has been outlining for us. The rest of the asian pictured did not look so bad. It is that legacy we are picking up on here in your. We will open a little bit more strongly. We also have some m a knows news. That provides Agricultural Products for farmer has reportedly increased its offer to syngenta. Caroline hyde has the details on this bloomberg school. It is a scoop that the price tag has been upped potentially by 5 . It is an offer of 47 billion compared to syngentas current market value, that is a juicy premium. 15 e than syngenta more than syngenta is currently worth. The higher proportion of cash is also notable. They are changing the way they are structuring the deal. For they were offering 45 cash. Now, we understand that the cash proportion of it will be upped and there will be a higher break 3 billion to syngenta if the deal does not go through due to regulatory issues. If youre looking at some of the reasoning. Why up the price point and spend so much particularly in such a volatile market . Monsanto would become the biggest producer of seeds, and chemicals. It has been focusing on your. It is a huge player in the United States already but it wants a bigger global footprint. Syngenta what offer than that. They would be able to get a larger piece of the pipe in europe. This is all playing into the general global trend. Consolidation. Consolidation with slower spending. Companies are coming together to be able to reduce that cost. There are changes. We should not expect this emanate to just waltz through. There could be issues from regular regulators and environmentalist. Monsanto would become huge in terms of influence over agriculture. It would also have issues with gml. Geneticallywant modified organisms. Here in the u k, people get worried about. Monsanto says this is good for agriculture and for providing the right amount of food for the world and the growing population. How will they deal with gml Going Forward . Also, the turmoil in the Financial Market how will that affect the deal . Meanwhile, we still understand that they have yet to look at the books. This is a 5 uptick in terms of price point but they have not gotten underneath and genentech to understand what is going on within the company. They have yet to do their due diligence. We will hold out on how far this deal will go but it is a nice price tag. 15 price tag. Anna thank you very much. 7 37 a. M. Here in london. We are 23 minutes away from the start of the european trading day. After yesterdays 2. 7 trillion wipeout in Global Equity markets. How are those closer to home set to open. Next, good to see you. To give us some context for what was a roller coaster ride yesterday. Did it make sense to you the extent of the stress we were seeing on Global Equity markets yesterday when the shanghai substantially but it has only lost eight months of gains . Nick it is troubling to see the fall in the chinese stock market. In reality, the stock market there is not as important for the chinese economy to say the ftse is to the u. K. People were concerned about chinese growth. Especially has how that affects emerging markets as a whole. Does that then derail the u. S. Economic recovery and the european recovery. That is where investors were concerned. It was called an extreme day. In theory, things went to far. Those were the underlying concerns. The slowdown in china that derail the u. S. And u. K. Is this a buying opportunity then . Have stocks been sold off too much . Nick we have to remember these earnings are depressed. You have no Earnings Growth in europe for quattro year. Your trading on a reasonably attractive multiple. We saw in the Second Quarter reasonably good earnings season. Sincee seen earnings then, revisions have been relatively positive for european companies. If you start to see Earnings Growth coming through on these reasonable multiples, yes. Anna when you look at valuations. You have to have some earnings to base that on. Do you base that on what has gone before . Boeing this morning talking about how many planes it plans to sell in china for the next 20 years. They are not talking about an incredibly depressed situation in the Chinese Market. About the longterm story in china is still in tact and robust. They were talking positively as well think that china is in good shape. How do you lineup these positive micro statements from companies with what we are seeing in the Chinese Market right now . Are these Companies Looking backwards to far . that actually china is slowing down much more quickly. We do not actually believe that is where the risks and concerns are. I would argue you need to see a month or two of data from china and europe and the u. S. To give investors a confident that those recoveries are intact in the u. S. And europe and china is not falling. Anna what kinds of rates of growth send alarm bells ringing . If 7 is where we started the year. Does 6 sit comfortably . Nick anything between 6 7 , in that range, is where we would expect things to be. If we fallout towards the bottom of that rate, that would be the concert. What people are the most concerned about, is what does it mean for the u. S. And european numbers. Those start to fall, then we are in trouble. ,nna coming up on countdown gdp is numbers came in on target this morning. We will bring you more it on the europes biggest economies numbers. That is coming up in a couple of minutes. Anna welcome back. You are watching countdown. Trading indicates european equities will rebound from their biggest slump. Expiring on the euro next month are of around 2 but the shanghai composite has extended this loss is falling below 3000 for the first time in eight months. Young its fourday loss 20 . Monsanto has made an increase takeover offer to send dental to syngenta. Earlier report was rejected, monsantos new offer, 470 swiss banks per share. If you still have some spare change after this Global Market route, maybe uber. They are looking to raise money and according to an offer sheet, investors willing to put in a minimum of 470,000 could see returns as high as 109 . What is likelyon to move these markets thursday morning. Is with us on stocks that could be on the move. Caroline keep an eye on the minors. Bhp billiton has profits falling. Far worse than what had been expected. Down 52 . Sales are off by 20 as well. The volatility is here to stay particularly when it is involved in china. Folks on chinas say the longerterm growth is still in tact and the dividend policy is going to be protected. Their dividend came in on . 52 where it was expected. This is an area where we still see costs coming out of the business to protect the shareholder, to protect their overall dividends. We will continue to focus on cost coming out of the system. The Capital Expenditure has been what had beenan previously expected for 2015. Keep an eye on bhp billiton. That profit miss. Is a big copper player but also a gold player as well. Down and sales are falling. This is all about production being hit by the slump in prices across the board. What we are seeing is wreaking havoc across the markets whether it be the bloomberg composite market, and the fact that the chinese slowdown is hitting equities so hard. It could be another tough day. Anna lets get back to nick. We heard some of the m a stories. Syngenta. We could see that stock higher this mining. We also have the m a regarding the rsa. They are now willing to talk to zurich. Pe about m a must be a tricky thing depend down at a time when the markets are as volatile as they are. Nick those companies are showing confidence. Between the micro and macro. Emanate in the u. S. Is back through previous peaks of 2007. In europe, the activity has lagged behind. In europe, we are more than a decade behind. What i wonder is if you start to see u. S. Companies gaining confidence and coming into europe and buying european companies, there may be more depressed valuations, and there may be more Earnings Growth to come. Youre also may be some cost savings to take out and revenue synergies and in the next week or so, if you have a deal or you are about to launch one, you may see those think. Anna when you look at what happened yesterday, and this morning in the session in asia where we continue to see some weaknesses certainly in the chinese story, but when you focus on the u. S. Yesterday, the you think about the day that the flash crash . Especially in the summer months. Does that trigger those kinds of conversations at ubs . The markets are changing from where they were 10 years ago. Much more ultimatums. More etf. More direct trades being executed. And the speeds of some of these trades, especially when you have a fastmoving market like yesterday, that will give you wobbles which increases peoples concerns and fears. Ultimately, we should take a step back and whatever happens through the rest of this week we know will be volatile. What we really need to see is what is happening in the economy and corporate profits. Those are reasonably robust. Certainly in europe. At yesterday, you do not think this is all machine driven. Initially that is what it is. Sometimes that may accelerate some of these trades and individual stocks for one or two minutes. In reality, what we are seeing since the middle of june when the shanghai composite was rolled over, has been more driven by concerns of the growth rather than a technical aspect. Anna are you reevaluating where you invest money . Would you sit back and wait . Are you less likely to get involved in commodities . What we have done since march is be mystically exposed. What we have been focusing on our companies with exposure to the domestic european economy. Those are the ones i would still be looking for. When you see the european and even the flash pmi at the end of last week it doesnt feel to us that the european recovery is running over. Anna thank you very much. Lets talk about what is happening in germany now. Germany german gdp numbers came in. We are looking ahead at the iphone. We are joined by hans nichols. What you make of these gdp numbers. Hans they were in line with estimates. It is forwardlooking. What we see in the Second Quarter is a German Economy that was fueled by exports. 2. 2 increase on the export french. Slight increase on private consumption. 0. 2 Capital Investment 0. 4 . I am looking at my script. 0. 7 to thetrade at gdp and then private consumption adding 0. 1. Thing is Capital Investment was down 0. 1 . Inventory down zero point 4 . Unless you think inventories have really increased and the Third Quarter, and unless you think that what has happened with the export will somehow dramatically change in the Third Quarter which is a difficult proposition when you think that most of the bad stuff in greece happened in the Third Quarter, all of this china slowdown has been happening in the Third Quarter. That is going to add a lot more pressure on exports which could give us negative numbers in the third order which allows me to get back to the number that we will get out later today which allows us to get excited about it. I know and that you always are but here is an actor reason to. In atexpected to come 107. 6. Last month it was 108. If it comes in much worse come up we will get an indication of just how concerned german businesses are about what is happening in china and greece even though that appears to be in the rearview mirror. I am excited. Anna i am trying my hardest. Sarah was with us earlier. She suggested we might see a pickup in that number because we do not have the same concerns around greece that we did a month ago. Is forsensus numbers that Business Climate to fall back a little for the month of august. We are a few minutes away from the start of tuesdays European Equity market. On the move will be starting soon. Jonathan we have to reflect on yesterday. The biggest oneday drop since 2008. They are hoping for stabilization this morning for a rebound. Futures across europe indicating we will get one. We will cut through some of the noise with Goldman Sachs official. He will join us for the first half an hour of the show. Many of the markets across europe expected to open higher. China. T did not is the shanghai route continues. We will be talking about that and the fallout for the minors. More pain for some of those companies. Those bhpl look it billiton earnings falling 15 . Anna thank you very much. Keeping an eye on those stocks at the start of trade. Things are looking a little more positive than they did this on yesterday. Up by more than 1. 5 . That is what the futures suggest. That will do it for countdown and i will leave you in the capable hands of the on the move team. Jonathan good morning. In welcome to on the move london. Moments away from the start of european trading after a 2. 7 trillion global and the route. Lets get straight your morning brief. Stocks in china plunged once again. The shanghai composite is poised for its fourth they slump in three years. Billiton false. . What fed hike market turmoil Barclays Says it will not come until march of 2016. Ahead of the open after yesterdays rout, 20 seconds away. Futures are up by 73 points. Maybe we will get that little bit of a rebound at the open. Lets get straight to it with caroline. Caroline half a trillion euros wiped out the stocks. Auld we see a little bit of bounce back. Jp morgan coming out and saying it is time to buy. They welcomed buying the stocks after the fall. Look at the manufacturing data. Are set for growth. 6 . Does it really back of the significant moves. Clearly, a little bit more optimism. Tentatively to buy into the riskier assets. We saw a slight reprieve in asia. Not much though if you look at chinese back. The storm seems to be contained in china today and in europe where looking