Accelerate the sale. Line the nests. Twitters companys management slams the user Group Calling it, quote, unacceptable. Hello, everyone. Yes, youre watching worldwide exchange. It is 9 00 a. M. Seema and will fred are out. We have julia out. I thought you were going to stay in greece. I thought we were going to get through the whole World Without mentioning the g world. We clearly didnt. No we didnt. You blew it already. It will be quieter over the next two months and then it will ramp up again. Well see. Good to be here anyway. Great to have you here. We have a lot to talk about today. Lets kick things off with peugot back in the race. They have a favorable fx race. Stefan is in paris. The payoff appears to be paying off. They posted stronger numbers for the first time in a while. Thats to compare with the loss of 114 million a year ago. Sales also were stronger than expected in the first half of 7 including 4. 3 growth for the auto motive division. There are plenty of reasons behind this recovery for peugot. The higher cost prices in the first of the year. Lower cost of materials and the recovery of the european auto markets in terms of outlook for the rest of the year, peugeot believes the European Market will expand by 6 this year but also thinks the Chinese Market will grow by 3 . The weaker Economic Growth in china is a concern for plenty of companies. It has great ambitions in the Company Since the main shareholder is a chinese company. The Company Confirms its guidance. Its targeting 2015 to 2017 what could upset the Chinese Market for peugeot situan. They had a market share. Iran was the Second Market after france before the international embargo. Peugeot used to sell 450,000 vehicles in the company. Thank you so much for that stefan. Volkswagen has posted a 5 jump in Second Quarter profits in line with expectations. The german automaker is sticking to its revenue outlook but is in a difficult market environment. Nancy is joining us around the desk. You can take your pick on Interest Rates, exchange rates, volatility. China, talk us through the numbers. Definitely. The message is loud and clear. The real message is that the Macro Economic conditions remain extremely challenging not only in china, especially in latin america, eastern europe. You referenced the slow down in russia as well. Plenty of hurdles facing volkswagen. I did see some strengths in the vw namesake brand which has been dubbed the problem child as they continue to get a lot of strength in the luxury brands. They did report a 3. 3 increase. So i think investors are somewhat happy about that. The stock is down about 2 . Real concern about the china picture going forward. However, i should mention on china they did also report quite a large dividend from the china operations. Art ellinghurst said it did take a dive. Some questions about the lack of cash flow in other parts of the world. A bit of a mixed picture. I think the concerns are around the country. The questions are whether this is a shortterm problem or whether its a longer term one. How do you navigate your company surrounding the uncertainty . Ee spegscial thats right, especially since theres a volatility. Theres an anticorruption in china. Nancy, thank you so much for that. Moving on. Bayer leading the Health Care Sector after they were surprised with a 21 leap in Second Quarter profits. Speaking to cnbc earlier, the ceo ruled out a merger deal with swiss rival cengenta. Cengenta is not a logical partner for bayer. Both cengenta and bayer are very strong in whats called chemical crop protections, herbicides, insecticides insecticides, fungicides to fight off disease for the crops. That is not a large call target. Market share isbarclays is getting a boost after the ceo was fired a week ago. Kathleen bum joins us around the desk. The focus on what theyre going to be on what theyre doing. The need for speed at barclays does seem to be what has driven anthony jenkins, the chief executive, who was ousted a few weeks ago out of his seat. Nothing today on whos expected to take over from him. They seem to be reluctant to put a time frame on a new chief executive. Executive chairman John Mcfarland seems to be ramping up the progress of that strategy and the cuts. He says he wants to remove the noncore assets from 57 billion today to 20 billion by the end of 2017. That seems like a huge amount of selloff. While they havent been too successful in executing that so far. I think you have to look at the pricing and also is this a really Good Environment to be selling off those kind of assets at the minute. Who wants to buy portuguese banking assets a the a price. They say theyre scrapping their dividend target. They want to retain capital but theyre also stating theyre not going to be raising capital externally. Just how difficult is their Capital Position right now . Should we be worried about that at all . There has been some speculation that it might need to raise 25 billion which isnt a huge amount when you think of the size of bark class. The ceo candidate has reaffirmed that in a call to reporters. They dont need to raise capital. That seems the position for the minute. You were talking about not giving anything away as far as the next ceo is concerned. There seems to be speculation that it could be the cfo and a number of big shareholders are going to say we dont want somebody internally. We want someone outside. Whats your sense whether that will be a problem . Finding a new cfo wont be an easy job. Someone who is supposed to be doing a decent job as the current candidate is it might be difficult to get in. We had a number of external candidates, mike smith of the zed bank and the president of morgan stanley. This will be a huge task to take on. They just ousted the previous guy, it may be quite difficult to be conducting those interviews. You have to wonder whether anyone, even the cfo, will be good enough for mr. Mcfarland. Hes been very picky. Anthony jenkins wasnt good enough even though he said that Steve Sedgwick did three weeks ago that he was an excellent guy, simply not good enough. I guess his expectations are sky high. If you look at the profits, the numbers arent bad by any stretch of the imagination. Mr. Jenkins might be sitting rubbing his wounds thinking is my legacy. Thats not so bad. Kathryn, thank you so much for that. Julia. We have to take a quick break. Coming up on the show. From a lion hunt to a manhunt. We reveal how the killer of one of zimbabwes most famous lions had his identity exposed. Plus a diver who found 1 million worth of the shiny stuff at the bottom of the sea. Nice if you can find it. The best boss in the world. The ceo who shared 27 million with his staff after he sold his firm. Youre watching worldwide exchange. Stay with us after this. Markets in europe now been open for, what just over an hour. 6 to 4 greens to red. Taking the stocks higher by. 3 . Five straight sessions of losses in yesterdays trading session. The u. S. Overnight and a bit of stabilization in what we saw in the Chinese Markets yesterday allowing gains this morning for these European Markets. Lets look at the individuals. Weve had a whole host of irngs this morning in particular. Weve talked about volkswagen peugeot. Barclays. The ftse 100 higher. Over in italy underperforming. 5 of 1 . Were looking forward to later on 9 evening, the fed. Will janet yellen give us any indication of the timing is concerned. As far as investors, 50 in the chance for a price hike. It will be interesting to see what they come up with if anything, later on tonight. What we did see with the stabilization in the commodities is the dollar. Regaining some ground in todays session. As far as the Foreign Exchange markets, here we are. 1. 1047. Dollar yen we came back off 123. 80. Inching closer to that. That is the level to watch. We continue to bounce around the 1. 56 level. The level to watch in sterling 1. 5675 which is the high of the last couple of weeks, too. Ive mentioned commodities briefly also. Lets take a look at whats going on as far as oil is concerned today as well. We did see a bit of a bounce in wti yesterday taking back more of those gains. In fact in todays session. What we heard today the Petroleum Institute said stocks fell by 1. 9 billion barrels a day Million Barrels a day last week. It was expected to be smaller than that. Opec produces 3 Million Barrels a day more than demand in q2. When you realize supply still the crucial issue here right now. Spot gold seeing a bit of consolidation. Still just below that 1100 level. Carolyn, back to you. Julia, we need to talk about twitter because twitter shares plunged after the companys founder called its performance unacceptable. Julia borsen has all the details. A roller coaster ride for twitter in after hours trading. First the stock traded higher on top and bot tomorrow lines results. Enks of 7 Cents Per Share were better than expected. Revenue grew on 61 on higher engagement and ad rates. They ended the quarter with 304 million users. Including the sms fast followers, users usually in emerging markets. The Company Ended with 316 million users. It was cfo anthony nodos comments that sent shares plummeting in after hours trading. To be clear, however, do not expect to see sustained meaningful growth in mous until we start to reach the mass market. Interim Ceo Jack Dorsey saying hes quote, not satisfied with twitters user growth talking about how hes realized how many changes the Company Needs to make and how hes simplifying 2wi9twitters service. We havent done a great job of aligning the entire company around our total audience strategy. We are in the process of implementing a stronger discipline of direct ownership and accountability that serves a single strategy in order to increase our reach, value to people and participation. The people the organizations and the companies that use twitter Must Come First and be at the center of everything we do. On the up side nodo said he thinks twitters ad load is 1 3 of where the company sees its longterm potential and that theres plenty of room to add new advertisers. Back over to you. Meanwhile, there are High Expectations for facebook as it reports q2 earnings after the bell today. Analysts expect video to drive earnings with continued growth in the number of users and how long they spend on the site. Hannah fitzgerald expects mobile to account for 75 of mobile. Instagram, whats up and opulus will provide longterm up side. Really interesting, yesterday. It was up 4 after the results and then the cfo started speaking and basically said look were in this turn around stage. Everyone went uhoh. Weve seen turn arounds before fail for these kind of stocks. What does this mean . That was surprisingly blunt. Thats what the market what the street needs. Yes, it was a little bit of a shocker because when do you ever see cfos and ceos come out and speak so candidly and bluntly. We showed you that video just there. You heard it yourself. They really they really used very blunt language. I think thats exactly what the market was looking for. I guess the big question now is are they going to be as blunt and as direct in attacking those problems. They themselves they gave us the laundry list. They want to communicate why people should use twitter, more disciplined product, execution. They want to better communicate the purpose of twitter. We dont have any details on how exactly theyre going to do that. If they could do that wouldnt they have done this before . Im struggling to see. I totally agree with you. Incredibly blunt about the issues as far as theyre concerned. Go back to the point. Look at my space. Once they admitted they were in this oh, dear now what turn around phase, sink time. They need a ceo. That would help. That would help wouldnt it . Dont have that around. On the board of square. Hes running square. Hes already said hes not going to be running twitter full time. He made a great point, 95 unaided brand recall. In english. Everyones heard of us but only a small number of people actually use us. This is interesting. Theyve got the user base, theyve got the awareness. They need to make it into a product that normal people use it. Journalists use it. Zble exactly. Ordinary people use facebook. Celebrities use it. Moms and dads brothers and sisters, they would use it and that is the problem. Get to the average man on the street. Facebook. Yeah, facebook. Oh, no your exchange. Lets talk about twitter a little bit more. Twitters management, as youve heard, theyve called the companys performance unacceptable. Can they turn it around or is it too late for twitter . We want to know from you. Let us know what you think. Join the conversation on worldwide exchange. Email worldwide cnbc. Our personal handles are on the bottom of the screen. 1e7bd them in those tweets ive seen two tweets already. Interesting. Keep them coming. How do they turn this around . Microsoft rolling out windows 10 today as a free upgrade for people using windows 8 or older versions. Microsoft alienated many traditional customers with windows 8 which focused on features for tablets. It brings back the old start menu and lets users pin items to their task bar. Now another choppy session in china where the shanghai composite fired this weeks sharp losses. The Stock Exchange announced its slashing fees under the stock connect program. We are in singapore. What impact will that have as far as the hong kong move is concerned . Is this a calm before an ongoing concern as far as the shanghai composite is concerned . I think its part of a broader attack to reinvigorate market confidence and get a lot of gun shy investors back into the market. They seem to be fulfilling their task thanks really to beijings reaffirmation and commitment to the stock markets. Back in the market buying stocks, shoring up confidence. How long that is going to last is anyones guess. The tizzy the market threw on monday when they got a wiff that they saw an 8. 5 decline. We saw the government and regulators saying were back in the market. The pbc injected more liquidity in the market. Were back up 3. 5 . Thats the best gain in 1 1 2 weeks for the shanghai composite. I would hasten to add volatility is probably going to be the watch word for this market for the near term at least because of the level of leverage carolyn, in the system. All in all returning stability of the china market 1 plus move we saw on wall street has reinstilled a little bit of confidence risk taking in the Australian Market which has bounced back. I would say theres an element of caution ahead of the fmc. Is it going to be consistent with a september move . If it is we could see more asian currency depreciation. That could feed into the stronger dollar story. If the fed is dovish and if it does mention china, if it mentions the legacy problems in greece as well then the market might come to the conclusion that perhaps liftoff is going to be late 2015 possibly even 2016 and not be constructive for equities over here. Thats where we stand. Thank you so much for that. Well have to wait a couple more hours. A few hours left until that fmoc statement. Billionaire investor land cooperman said hes unimpressed with the market volatility. China was growing 10 , its growing 6. Theres a big deescalation of growth. The economy globally has grown. I think the government shot themselves in the foot with their intervention in the market. We like more transparency rule of law. We like the government, in fact i like to say the government of the United States should get more out of our market. Thats one of the reasons why the economy in america has been growing slowly is excessive regulation. Fred, im a little puzzled this morning. I looked at one data point. The china Consumer Confidence number for july and that actually rose despite the fact that we had a Big Stock Market selloff. Are you surprised by this or is it really just a case of not paying too much attention to the data overall because you dont know if thats correct or incorrect . Its not the most reliable data point out of china. It probably needs to be taken with a pinch of salt. It does perhaps point to one underlying reality which is the average person on the street in china has not been heavily invested in the stock market. Yes, theres a small sliver of say the upper middle class that has invested but the broad masses of chinese really arent big into the stock market. It has affected a small segment of the population but not really china at large. And perhaps this particular data point reinforces that particular observation. But fred i just fail to see how there can be any sustainable wealth effect from Big Stock Market rally we saw up until june. As youve just pointed out, no real negative wealth effect as a result from the stock market slump. I mean what effect does the stock market have on chinese consumers then . Well generally the perceived wisdom is that it has very little impact on Consumer Spending in china, however, were still waiting for some data points for confirmation on this. For example, we saw a big surge in real estate transactions in both may and june and were waiting for the july data to see whether theres been some pay back because some of the increase in real estate purchases that has happened in cities where a lot of Stock Holding, where Stock Holding is relatively large in first and second tier cities there could be some pay back there. We also saw a decline in auto sales last month. There is at the margin there is some impact on upper middle class spending patterns apartments, cars et cetera but broader retail sales should remain unaffected by this. Fred ive been looking at some data of the shanghai composite. It spends 63 of the time in month in bear markets. Weve had 10 of them in 1990 and 2 in the u. S. Its never triggered bear markets in u. S. Equities. Are we overplaying it in terms of our focus and bearishness. Its already highlighting issues we knew were there. We were never comfortable with the fundamentals that carolyn was pointing out than we are when its selling off . Thats correct. The majority of the time the equity market doesnt really matter. Chinas all about real estate. Its been real estate construction. Its about real estate values and that influences Consumer Spending patterns that influences the global commodity cycle, gdp growth. The equity market is a side show. Having said that this time around might be a touch different. The reason is margin financing which is a new animal in china. It is because the broader economy is weaker this time. The fear is that perhaps this time the equity market will have a slightly bigger impact on growth but it should broadly be manageable for the authorities. It might shave 0. 2, 0. 3 percentage point off of gdp growth. This is something thats broadly manageable. Fred, finally want to ask you about the wuan. They said we would see more twoway volatility in the uan. Its been pegged at 6. 2. Thats happened since april. How detrimental is that to the pbocs credibility . Well i think for a time being its all about stability in china. A lot of moving parts here. We have a weakening Real Estate Market certainly on the construction side. We have a weaker equity market. The broader economy is slowing down. So the currency is currently a Macro Economic anchor if you will. It provides stability, but having said that there is some indication that the chinese authorities might widen the trading ban at some point, reintroducing volatility. It will be a gradual process because right now we are in a stabilization period but over the next few quarters i would expect more volatility come back into play. Previously it was volatility that was one sided, broad appreciation. This time there will be volatility in the truest sense of the word which is a symmetric volatility around a broader level that is stable against the u. S. Dollar. Fred norman cohead of Asian Economics Research at hsbc. Some flushes on the bombardier bombardier. A potential train merger. They are talking about potential partners going forward. Bombardier having a potential floatation of their rail business. A train tieup could follow that partial cred did i days. Thats something to watch going forward. We have a little bit of news from sans bury and germany celesio. Jay sainsbury and celesio will see Lloyds Pharmacy acquire sainsburys pharmacy for 125 Million Pounds. Now we have to take a quick break. Still to come on the show the brazilian real trading causing prices to heat up. Can the central bank raise rates again . Stay tuned as we discuss. A wave of earnings drive european stocks higher. Frances german peugeot drive prices higher. The german car maker warnings of emerging prices. The dax has a demand for its drug product. The german drug maker benefitting from favorable currency swings. Investors cheer more cost cutting at barclays. They say they will accelerate the sale of assets after a sharp rise in q2 profits. Line the nest. A number of companies downgrade their prices on twitter. They slam the new growth calling it quote, unacceptable. Well its a mixed bag for European Markets after starting out earlier on in the trading session. Investors just digesting some of the earnings weve had out this morning. Just the ftse 100 managing to hold in positive territory by. 3. We have the xetra dax. Hidelberg cement. Shying off 3 this morning. Cac carant down. Were not seeing too Much Movement in the dollar index ahead of the fed statement later on today. The dollar index is flat right now. Euro dollar is flat as well 1. 1064. Cable 112. 64. Some of the commodity related currencies under pressure given the impending rate hikes. Mixed bag this morning. Wti lower by half a percent. Brent crude shy by. 6 of 1 . The oil majors opened higher 3 4 of 1 . Didnt last long. A bit of a bounce in stabilization for some of the Precious Metals gold and silver managing to eke out things in the session today. I just wonder how much volume there is in the market because now we are in the middle of august. Everyone seems to be on holiday except for the two of us obviously. Youre absolutely right. Theyre talking about markets. A lack of liquidity there. We shouldnt be reading too much into it. Some level of volatility in the dax, too. Worth mentioning. Of course the fed is making the headlines today. The fed wraps up its twoday meeting today with a decision due at 2 00 p. M. Eastern. Most economists expect little news from the central bank or clues as to when it would start raising Interest Rates. A majority of fed watchers expect a rate increase at the september meeting which is accompanied by yellens news conference. Emerging market currencies have plummeted to lows not seen in 15 years. Meantime Chinese Market volatility and depressed Commodity Prices weighing on the exchange rates. Perfect storm. Earlier the Russian Central Bank said it will stop forex purchases. The central bank began the fx purchases in may. It has denied it was targeting a particular price for the ruble. Meanwhile, analysts are forecasting a rate cut when the central bank meets on friday. Lets talk brazil. Theyre widely expected to hike rates later today amid sky high inflation levels. Standard poors has downgraded brazils sovereign Credit Outlook to negative after expressing concerns over the countrys ongoing corruption investigations. Brazil goes first with a possible rate hike later today. Sky high inflation levels as weve mentioned. Joining us is louis, the head of ce fx and rate strategy at citi. Want to talk about the downgreat for the outlook by s ps first look in brazil. Do you think that was expected . Sometimes they are behind the curve. The issues they highlight, Political Economic reasons, theyre not new. Well i mean i partially agree with that. I think that the rating agencies in general, when it comes to fiscal degeneration, they have to be a little bit behind the curve. That move in s p is probably following this trend. It has to do of course with this abrupt revision of the fiscal target implemented last week which shocked a few. It shouldnt have shocked investors who are actually following brazil a little bit more in detail given the dreadful growth dynamics that has now taken place in the brazilian economy and obviously this is almost finally filtering through the fiscal policy. Its going to be very difficult for brazil to implement the Fiscal Consolidation they need in this current growth environment. Of course, rating agencies are reacting to that. The markets especially if you look at cds, looking to the credit markets, they were partially pricing that in already. So its very hard to say that that was unexpected by the market. Still we saw the brazilian rate selling off against the dollar. I want to move to the central bank. Its one of the few central banks, luis thats hiking rates. Its concerned about the inflationary pressure. If you were in their shoes, what would you do . Wouldnt you be concerned about the growth rates as well . This country is in a recession. It is in a recession. We believe given our economic forecasts we believe its going to get worse before we stabilize in brazil. The problem, historical issue of the central bank in brazil the central bank had to overhike in order to offset the super loose fiscal policy. I think that were just starting to correct the fiscal side. So that probably still requires some tightening from the part of the central bank and its very early in the game to crawl forward in a new cycle in brazil despite the dreadful outlook. I want to drag you on to turkey. I know youve established a short turkey position versus the euro and the dollar. Its already down 15 this year. What kind of up side in terms of dollar are we looking at here . And in terms of the domestic outlook, how does this play out . Because weve seen them now bombing i. S. Bombing the p. K. K. , thats going to create issues in trying to form a coalition. Are we looking at a fresh election at some point in the coming months, too . I believe. I believe that we cannot discard that. We are reaching some sort of coalition here. Obviously the clock is ticking and i think that the markets have started this process a little bit too relaxed imagining that we were going to reach a coalition too early in the process. I think the situation on the Syrian Border is making everything a lot more difficult, including in all the talks in terms of coalition between a. K. P. , c. H. P. M. H. P. And the kurdish party. Everything is getting more difficult. The market is reprizing. A r away from politics the situation in turkey is difficult in terms of balancing payments and financing of the current account. We know that now equity given the political, geopolitical situation, equity flows are coming down. The bond ratings were weak. In terms of p. O. P. Dynamics the situation is getting very difficult. We know the fx is the natural lever in a situation like this. So i do believe in a much weaker position coming here. Whats positioning like in turkey to get a sense . I know a lot of people piled into this in june and july in particular. We saw one of the biggest exits from turkey in last weeks trading session in particular. Is this people closing out loans at this stage . Market is not short yet. I think this is the Perfect Question in a moment like this because over the past month or so what we realize in our flow models based on flow seen in our platforms is that actually hedge funds and real money accounts they actually went long turkish given the care yich and we know the carry plays they are very good as long as they last. We are coming to the end of this carry adventure in the turkish leader. The same in brazil and real for example. A little bit more on the inr. In general in turkey this is coming to an end. The catalyst was probably the geopolitical side. In general, what we see, we see that there is a lot more to go through in terms of unwinds of turkish leaders longs here. It can take the dollar higher. Two quick questions. Ruble looking pretty unloved with wti here. Still happy to hold short there. Whats it what do you actually like investing in at this stage . I mentioned inr, i mentioned india. I think that there you still have the backdrop of a very solid central bank a central bank that actually sounded very cautious when it comes to the fear of a fed hike maybe 6, 9 months ago, so theyve been very consistent despite some slowdown of the economy. I believe you have a good background there. Its still a higher yielding currency. So in general i do like inr. What we try to do now, we try to upset the negative carry in the shorts we have with long positions, for example, the inr is definitely one Good Alternative but its difficult. In the yen fekdseffects, its difficult to find solid loans. The asset class has been challenged by commodities, by fed, by the debasement of euro rates. So, i mean everything is coming together here. In china, of course lets not forget china which is exporting deflation to the rest of the yen. So its a very challenging effect. I hear you. Its an extreme cherry picking exercise. Luis costa. Im looking at interesting comments coming from the chinese finance minister he says not surprisingly the economy faces relatively large downward pressure and they will further regulate management of local Government Debt. There has been so much concern around the local Government Debt levels that will guide Government Debt into key fragment sectors. They will push forward with concerns on consumption tax and will improve the resources, tax system and will increase regulation of ways that local governments raise debt. Those are the latest comments from the chinese finance minister. Still to come on the show poging your property portfolio. We surveyed the u. K. And irish housing sectors as price Growth Continues to build. Well be back in 2. Dont go away. Need to hire fast . Go to ziprecruiter. Com and post your job to over one hundred of the webs leading job boards with a single click. Then simply select the best candidates from one easy to review list. And now you can use zip recruiter for free. Go to ziprecruiter. Com. French police say around 2,000 migrants tried to enter in cali in trying to reach the u. K. They called this quote, the biggest incursion in the past month and a half. Lbnh a trading higher after the Second Quarter rose 23 . Lets get out to stefan pedrozzi. Pretty good numbers given that weve been seeing a slowdown in many parts of the world. Thats quite surprising. Very strong numbers, indeed. Will it last . Thats the key question. Not only for lvmh but for the whole sector because of the slowdown in chinese Economic Growth. There are questions about the sustainability of this recovery. The lvmh doesnt report quarterly profit but it says for the first time for the euro its net profit grew by 15 to nearly 3 billion euros. In the Second Quarter sales were up 23 boosted by the recovery of the flexion. So Favorable Exchange rate. Something weve seen with other luxury groups earlier this week they reported stronger growth because of the recovery of gucci but also because of Favorable Exchange rates. International revenue. Also in europe, it makes the products more competitive for international choice. All in all, the weaker euro is a good thing for the luxury sector sector. That being said luxury groups with chinese consumers are the first ones for the luxury items. Dont move a muscle. Total had a Second Quarter adjusted profit defying a slum in oil prices. Stefan, give us your take on this. Its really bearing fruit in the ramp up in their costcutting drive, isnt it . Absolutely. It was a challenge for total to come close to stable net profit for the Second Quarter. Down only 2 . The price of oil have declined by 44 . Most of it has been upset by costcutting measures. Total says this morning that it will actually exceed its Cost Reduction plan for this year. The original target was a reduction of 1. 2 billion on the full year. Total managed to increase its production by 12 on the quarter thanks to new projects and also the renewal of its license in abu dhabi. Total also confirmed that its going to reduce its Capital Expenditure this year to take into account the lower price of oil. It will reduce the cap exto between 23 and 24 billion down from 26. 4 for the last year. Thank you so much for that stefan. Cy saipem announced 8 billion job cuts as part of a job cut program. They downgrade their rating on the Oil Contractor stocks. Its off by 6. 75 . Kwoo it a big slump there for the stock today. Solvay is buying cytec for 5. 5 billion. They hope it will increase the market share in light weight materials. It comes after solvay had a Group Net Sales in the Second Quarter. Joining us is the ceo of solvay. Can i ask you why now . Why this deal . Right now because theres a very significant transformation process a few years ago. Weve made significant step when we divested European Business at the end of june 2004. Just a few weeks ago. And we think they were ready for a next step. Why this . Just because we do believe that getting a position in aerospace, i take it is the Second Global supplier of advance matter to aerospace. We think this is very effective for a company like us. We have a large range of specialty within solvay. Many markets from smart phones. We have a small position in aerospace. The willingness to become much stronger on skycitech. Scitech strong in composites. Your business strong in the likes of resins and autos. Incredibly Long Development time in these applications. Im wondering if the benefit is a long way in the future. Well, it depends at which part of which types of airplane application. If you look at that it takes many years and scitech and where the secondary application, scitech is faster. We could find the position within the cabin very good. Something much easier to reach. Do we expect to see some impact in the next two or three years . Yes, indeed. The composite could be the next big thing. Cytec is a very very premium range of cars. Focus today on luxury makers but not as premium as the one i mentioned. There, too, were seeing the development tends to be shorter. Yes, we expect in the next couple of years we see the first kind of this integration on top of the synergies which will take place. Jean pierre i want to ask you about the currency angle. Obviously you report in euros but youre buying this company in u. S. Dollars. Obviously, with the Current Exchange rate that seems quite expensive for you. Do you feel that maybe you are over paying for this deal or do you think it makes sense because the u. S. Company specifically offers great growth potential, something that maybe your company doesnt really have . Well you know cytec is listed so we pay the premium which is 30 . Very standard for these types of operation. We think we are paying a significant multiple because we think that the Growth Opportunity of cytec are very significant. Yes, this is a great opportunity for us to get the position in the market that we consider very attractive for a Chemical Company like ours while developing specialty materials. A pleasure speaking to you. The ceo at solvay. Italcementi is seeking a hike to 1. 7 billion our rows. The stock and cash deal was priced fairly. Some are surprised the german cement dealer didnt buy it in full. This combs less than a month after rival cement giants completed a 44 million megamerger. The newly combined entity under pressure in todays trade after the first earnings fell and missed analysts expectations. Management insists increasing demand and higher prices will boost the numbers. Its cheaper to live in madrid and commute to london than actually live here. Thats according to a labor candidate for london. When releasing the analysis she said renters approach paying the price for the countrys housing crisis. A report from Oxford Economics it showed the average home in london would cost 1 Million Pounds by 2030. Is that all . Joining us now is the chief economist at good party. Great to have you on the program. I want to talk to you about house prices. If i look at planning approvals, theyre also now at a post crisis high and yet its not translating to construction so it comes to the harder issue which is supply. Yeah. It seems like for 20 or 30 years weve been talking about it in the u. K. Context, the demand for housing. We never seem to get there. As a result of the undersupply over that time period weve continued to see prices rise. Now we are seeing an increase in planning approvals, planning commissions and supply as well but its not going to get to that 200,000 any time soon. In a demand context, were seeing rates continue to come down over the last couple of years. Importantly, were seeing competition in the Banking Sector bring down mortgage rates. Then, of course, big elephant in the room of course is free money for the last number of years. So youve got a bit of a sweet spot in terms of on the demand side, very very Strong Demand and supply which is under supplied and it has been for the last number of years. Thats why prices are going up. As i said were in a sweet spot but were of course at the precipice of Interest Rates starting to rise. Thats not just the monetary effect. The Irish Economy in a sweet spot as well. Theyre over 1 3 below precrisis levels. The central bank is using macro credentials to cool the market. House house prices rose 50 . That was purchases forward. Were coming off a low base. House Price Inflation is slowing. Weve seen in the dublin context. Very similar in dublin and london. Dublin is the employment center. Were seeing the strongest employment growth in that particular region. Thats where were seeing the strongest house price growths. So house prices in dublin are up 30 in the last three years. Theres still, remember 40 below the peak level. So were at the early stages of recovery. Now what we havent seen is an increase in supply and thats the next stage of recovery. Dermott, chief economist on good body. Find out who rather than what caused the dive. Stay with us. Welcome to worldwide exchange. These are your headlines from around the world. Flying the nest. A number of banks downgrade their price target for twitter after the companys management slams the growth calling it unacceptable. Another erratic session in china with stocks swinging between gains and losses. Theyre creeping towards a higher opening with all eyes on the fed statement. Crude back on a slide. Chevron the latest victim of the volatility as the energy