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Search business. And prudential prepares to deliver firsthalf earnings in about 15 minutes. Profits are expected to surge by 10 , but investors eye the challenges ahead. Welcome to the show. Lets get straight to european markets, which were indeed quite strong yesterday. A slew of earnings and oil prices recovering by a couple of percent allowed equity markets to perform relatively well, better in europe than in the u. S. , but positive across the board. Now, today we are down 0. 6 for the broader stoxx 600 as you can see, a correction from yesterdays positivity and more of a continuation of how august as a whole has kicked off. Ftse 100 down 0. 6 , germany and france down a little bit more than that. Athens is in positive territory and seema will tell you why. Absolutely. Lets take a look at that top story. Greece and its International Creditors have agreed to a deal on bailout terms following long negotiations. Finance Ministry Sources telling cnbc that a number of minor issues still need to be ironed out, but it is expected the funds will be available to greece by august 20th to allow the country to meet an ecb payment due on that date. Julia chatterley, who follows the greece story very closely, joining us around the desk. From looking at market reaction, you would think perhaps markets would be higher, but at this point, were lower. Does that perhaps mean that that greece deal is already priced into stocks . It could do, seema. We have been expecting this. It is, though, quicker, i think, than perhaps some had imagined. The sense over the last few days has been that we were working towards this point. I think the other thing to remember is weve only had this confirmed by the greeks at this stage, so we want to wait and hear what the europeans say later on today. And of course, if we can then get this deal agreed with the troika, theres a lot of other questions. The first thing, it has to be signed off in greeces parliament. Theres apparently 30odd, maybe more, prior actions, reform measures that need to be implemented in parliament before they can get their hands on the cash. The euro group have got to sign off on it. I think from that element, what weve heard from the germans, the deputy finance minister was talking this morning, a bit of a seed change from previous days, saying look, we want a proper agreement, we dont need to rush this. Then theyre saying theyre cautiously welcoming the deal. So, thats a positive sign. We still dont know about the imfs involvement or the ultimate surface targets this year. As much as its good to get a deal in, to get money in so they can make that august 20th bond payment to the ecb, theres far broader questions about just how accurate and right this deal is for greece, and of course, what happens going forwards with regards to writedowns, never mind the political situation. But at least for now, it seems at this stage that we have at least reached a deal earlier than anticipated for greece, which is a bit of a miracle. A step in the right direction at this point, but of course, still questions remain. For now, julia chatterley, thank you so much. Lets look at currency markets. Indeed. Weve seen equity markets for most of europe declining because of this deal, and it hasnt really had an effect on currency markets either. The euro dollar just above flat today. We have crossed back above 1. 10 late yesterday, at 1. 1034. But in general, the last few weeks have been relatively muted for the euro dollar pair. Weve got a slight increase in the dollar against the yen. Sterling is basically flat. The one big mover that were looking at here is the aussie dollar, off 0. 8 , off the back of the decision by the chinese to allow the rnb to devaluate by around 2 . Of course, relative to moves weve seen in the euro and the yen, its a very small move, 2 . So, they have deserted their usually strong starts of not letting it devalue just to allow a small move. Will that be enough to allow exports to recover . Of course, the fallen exports we saw over the weekend, the catalyst to see them dessert their traditional stance on keeping the currency steady. Lets look at bond rates. What are they doing today . The tenyear in the u. S. Just below 2. 2 and the tenyear in germany below 2. 7. Those have been steady the last couple days, those two safe havens. Looking at italy, 1. 8 . So, again, not much of a move in the peripheral yield spreads, despite the deal weve seen out of greece. Joining us down the line is anthony obrien, cohead of european rate strategy at morgan stanley. He joins us now. Gom you. Thanks very much for joining us. Lets get straight to this greek deal and explore whether that changes your preference between safe havens in europe and the peripherals in europe. I mean, obviously, you know, the news that we heard is a positive for the market and it takes the probability of that down somewhat. As julia was saying, there still, a lot of things need to be ironed out, it needs to be ratified by European Parliament or some European Parliaments. But you knoef, tw, the belief i market is its pretty much a done deal and were looking at other things right now. You know, the Italian Government bond market, which was a little weaker this morning has bounced back a bit, but you know, spreads versus bunds have remained pretty much flat for the past month or so. And you know, this is very much our line of thinking, you know, that we are expecting more sort of flatness rather than some sort of compression between periphery and bunds for the time being. Anthony, lets digress and talk a little bit more about bonds in europe more generally. Your recent note said that theres a long way still to go until we get back to normality, and you should still be Long Duration, despite the historical standards very low yields. Is that right, you still want to be Long Duration . Well, for the short term, were tactically long would be the best way of describing, because you know, general excess returns have been positive in august. We had a decent index extension at the end of july. And you know, there is very little supply over the next few weeks. More medium to longer terms, we do believe that yields have some way to push higher. We do think that, you know, in investors eyes, the eurozone, the economy, we should do, you know, better next year, inflation should return towards where the ecbs target is, and therefore, you know, qe will not be extended beyond september. So, you know, more of the mediumlonger term, we do believe its more of a bearish market for european fixed income, but august is generally a favorable month and were tactically long at the moment. Would you be a buyer of peripheral debt with this greece news of a deal coming together . Is this the time to buy perhaps the spanish or italian tenyear . Well, as i say, for the markets, theyve pretty much priced in the greek news. Were generally more positive on spain rather than italy. Spanish has got its own political, you know, sort of problems, which investors have to get their head around coming into the general election there. But you know, as more medium term, spain looks, you know, the economy we think is even though the Italian Economy is improving, spain is, you know, doing better at the moment and we believe once the political uncertainties are out of the way that some of this spanish underperformance which weve seen over the past few months should start outperforming a little bit in the future. Anthony, as we get closer to rate hikes in the u. S. , do you think that hike is already priced into euro dollar, or on the day that we see a tiny 25 basis points move, do we see the currency pair go nuts again . I think, you know, theres obviously the time there are two aspects here, the timing of the first rate hike and the duration or the magnitude of any hiking cycle. And i think were kind of moving away from the, you know, its all about the timing of the first rate hike to, well, actually, its all about how high rates will go. And even though Economic Data were expecting to be a little bit better, you know, the payrolls data we saw on friday was in line. You know, although that can change the timing of the first rate hike and it might be moving towards, you know, september, certainly the probability seems to be pushing towards september, you know, it is more about the magnitude of the rate hike and cycle. And i think euro dollar will be sort of more keen to see what the next move is from the fed, rather than the first move. So, you know, i dont know whether we should get so carried away with the timing. As i say, its all about how far they will have to go in the future, rather than is it a septemberdecember thing. Anthony, thank you so much for joining us. Much appreciated. Anthony obrien, cohead of european rate strategy at morgan stanley. Now to another top story. The chinese yuan is headed for its biggest oneday drop after the pboc devalued the currency in the wake of poor recent Economic Data. Lets get more on this story with Sri Jegarajah live from singapo singapore. Hi, seema. The effect of this surprise devaluation by almost 2 off the yuan was that shanghai composite mainland equities pretty much flat at the settlement. What happened here was that the importers, their dollar costs go up, of course, like the airlines for fuel. So, they were quite badly sold off today. But the exporters, the trading companies, the textile manufacturers and those exporters, that sector did quite well. Some of those names going limit up by about 10 . The net effect was equilibrium at the close for the shanghai composite. But the real action was in the currency space, and it really added to the weakness in the asian fx sphere, because it was already under pressure because of fed normalization, stronger dollar, the high rates environment as well as we creep closer towards normalization, the september liftoff. And then you had this double whammy from the chinese. So, we saw the ringate, the ruper at lows, the Singapore Dollar at fiveyear lows against the greenback as well. So, the big question is really whether this devaluation is going to be a oneoff or whether this is going to be more of a longerterm strategy. Were still yet to really answer that question. This is where we stand right now. Back to you now. Okay, sri, thank you very much for that. Lets look at luxury and auto stocks in europe, because they too are under pressure from the yuan devaluatiodevaluation. China an sportsnet export market for these sectors. Weak auto sales adding to the pain with july figures falling over 7 on the year. Thats the biggest drop in 2 1 2 years, as you can see. Were looking around 2 to 3 of declines across those names in europe today. And coming up on Worldwide Exchange, a is for awesome. Larry page hails new company alphabet, which has just absorbed google. All the details on this major restructuring, coming up. Plus, we reveal the secrets of shake shacks success after a sizzling Second Quarter, sending shares surging after hours. And prudential is expected to ring in its new boss with bumper profits. Those numbers hitting the wires in just a few minutes time. Dont go away. Youre watching Worldwide Exchange. More and more, data is visual. In fact, the number of mris has increased by ten percent a year. And a radiologist might view a thousand images to find one tiny abnormality in shape, contrast or movement. Because its so challenging, a Research Project is teaching ibm watson to see. In the future, it could help clinicians spot key patterns quickly and precisely. Ibm watson is working to make healthcare smarter every day. And welcome back to the show. You are watching Worldwide Exchange here on tuesday. We are looking at european equities lower, despite that news of a greek deal slowly coming together. In the meantime, were looking at our earnings, or waiting for earnings from prudential, which right now is trading at 1,483, down just by around 1. 5 . Of course, prudential ringing in its new boss with a doubledigit rise in operating profits. That, of course, is the expectation. Lets bring in those results. They just hit the wires. Were looking at operating profit of 1. 881 billion. Thats up 17 . Lets have a look through some of these other ones. Interim dividend is 12. 31 pence per share. And lots of numbers coming through. Lets have a look. So, it has recovered, the share price, off the back of the initial numbers by about 0. 75 , down north 0. 6 . Lets look at other numbers. Key things to look out for, like the relations to the department of labor in the states and, indeed, the headline sales number, which havent quite hit the wires yet. Lets look. Pretax profit 2. 08 billion, revenue overall of 25. 3 billion. Other divisions within prudential to keep an eye on, of course, the uk life ifrs operating profit at 436 million pounds, up 19 . Also, m g ifrs operating profit at 251 million, up about 11 . Another one to watch out for, of course, is jackson life, ifrs operating profit also up about 11 . So, catherine, Immediate Reaction from the share price, of course, is slightly positive. What are the key themes youre going to be looking out for today and in the months ahead, of course . Wilfred, i think, of course, this is a stock which has been a market darling, particularly, kind of the pick among the european insurers over the past few years because of that exposure to the u. S. And to asia and relatively low exposure to the eurozone, but that now seems to be undergoing something of a reversal as it isnt quite as exposed to the eurozone recovery as some investors might want. And of course, weve got those new department of labor regulations coming in in the u. S. , which could restrict some of its sales. We saw axa earlier this month warning that that could bring sales down by as much as 30 . So, if we see anything from prudential today on just what their estimates are of how thats going to affect their business, that will be extremely interesting. And of course, were all waiting to hear from the new executive and just what his plans are for the business. Absolutely. We will continue to bring you more on that once the chief executive starts to speak. At the moment, though, catherine, thank you very much. Were looking at prudential shares down 0. 6 on the day but they have recovered by about 1 ahead of those results. They were down 1. 6 . Lets have a look at other top stocks in european trade today. Shares of circo are trading higher after the outsourcing firm for investors was better than expected for revenue in the first half. The uk company recovering from a series of contract scandals but said trading was better than anticipated. As you can see, its up the best part of 2. 5 . Adeco shares lower after q2 profit missed expectations. However, they maintain its 2015 outlook, saying it expects a boost in growth from france. But overall, as you can see, thats down sharply, down 3. 2 . Now, gam has made a bet on the Property Market by picking up londonbased renshaw bays Real Estate Finance business. The swiss finance manager also reported firsthalf part of the year results, which saw commission decline. That stock off sharply, down 4. 9 . Do stay with us here on Worldwide Exchange, because joining us on the phone is alexander friedman, ceo of gam holdings, joining us now. Good morning to you, alexander. Its great to have you with us. Good morning. Off the back of these earnings. Clearly, the share price reaction has been negative. Lets talk about the acquisition, the Real Estate Finance business from renshaw. Talk us through your rationale for wanting exposure to european commercial property at the moment. Yeah, thanks very much for having me. I mean, renshaw bay has a terrific Real Estate Finance business, and this is an area that is quite interesting, given the kind of lowyield environment were in. Private Market Real Estate debt is an asset class that makes a lot of sense for institutional investors. Its one we dont currently offer and its in great demand for many of our clients. When it was clear to us this was potentially an option, we jumped on it because we think theyre a terrific group. Alexander, as we get closer to rates going up, of course, in the u. S. Likely first ahead of europe, but hows that going to affect this business . Yeah, i mean, look at the overall environment. You talked about the devaluation of the chinese currency today. I mean, we have a very gradual normalization path ahead of us in the United States and largely an accommodative rest of the world, exuk. So, i think if you look at kind of overall european environment, which is the area this group operates in, its still going to be a lowyield environment for a while, and an environment where this kind of an asset class should do quite well. Why are you making a bet on the Real Estate Market now here, you know, midway into 2015, alexander . And second question, how do you see this acquisition ultimately helping improve your bottom line . Yeah, i mean, our business is actually quite strong and stable. You mentioned that our share price is off a bit today. Thats largely the result of what happened with the swiss franc appreciation. Our net new money growth was significant, over 6 billion total. In terms of is this the right timing, if youre investing over the long term, as we are, this is an asset class we want to be in. We think the kind of environment across europe is quite heterogenius, so you have to separate out ireland and uk and germany and other areas where they operate, so its not just one story overall. From our perspective, this is also important because its longterm committed capital, which for an asset manager, its nice to balance out kind of use its money, which is more liquid, moves in and out. So, for us, we think its an attractive thing to do. Its accretive from day one and an important area to get into. Lets talk about your results as well. How are you finding the current environment . Of course, still a lot of economic headwinds facing your business. Yeah, no doubt. You know, if youre an Investment Management firm as we are, it comes down to really two things. They have good performance and funds and kind of a Good Business mix. Our funds are doing great. We have over 80 of our funds outperforming and our performance fees last year are almost at record, so our performance is excellent. Our net new money is actually good. We face a unique headwind in the swiss franc. Without that, our operating results would be up 5 . So, you have to look through the headline of what is reported and you have to understand the business dynamics. Ours are actually doing great. Alex, final question quickly. Youre staring at a 4. 9 decline in the share price this morning. The market clearly not warming too much to this acquisition. Try and reassure people quickly that its the right move. Yeah, i mean, this acquisition i dont think is driving the share price. Its a shortterm reaction. You have to look through that as aine investor. The acquisition makes a ton of sense from where we sit because its a logical asset class to be in, a tuckin acquisition from our perspective, so accretive, but its not in any way a large acquisition from our perspective. And again, in a lowyield environment, Real Estate Finance is one of the best places you can be. Its a libor plusa type of profile, which, believe me, is a good return in these days for fixed income type stuff. Okay, alexander. Thanks very much for joining us, appreciate it. Alexander friedman, ceo of gam. Will it be as easy as abc . Google has announced a new Corporate Structure creating a Company Called alphabet. Tech reporter jon fortt has all the details. Google will continue to exist as a subsidiary of alphabet called google inc. , and there will be a new ceo of google inc. , sundar pichai, who has been a chief operating officer and will be ceo of alphabet. Larry page and sergei are not going anywhere, continuing to operate the Holding Company of alphabet. Eric schmidt, the executive chairman of google, will now be executive chairman of alphabet. Now, what will fall within google and what will fall within alphabet . Well, most of the revenue and profitproducing businesses that now exist within google are going to be a part of google inc. That includes youtube, which is being run by youtubes ceo susan wajiski. She will serve in that role but report up to sundar pichai. A number of other things will not be a part of google, theyll be part of alphabet, including google x, the research and Development Arm thats doing things like drones and selfdriving cars. That will not be a part of google inc. Also, calico, the Life Sciences project where google is trying to break ground in those areas, those will now be part of alphabet. Also, google fiber, initiatives like that that are not part of the internet businesses of google will be part of alphabet. But nexus, the hardware business that isnt exactly internetrelated, thats connected to android, that will continue to be a part of google. The Analyst Community is weighing in on googles change to alphabet. Colin sebastian at baird says its incrementally positive, improving accountability as investors view googles speculative businesses such as the selfdriving car as a distraction. He has a 720 price target. Tripp chowdhry at Global Equities says google has given a wakeup call to other tech companies. And yusef says this is a key step towards greater transparency. And others expect better focus and execution, but they maintain a hold rating. Google class c shares rising 6 in afterhours trade, as you can see in german trade today. Theyre up the best part of 5 . So, big surprise, an interesting move, seema, the google change increasing, i suppose, the focus and expertise. And when you think of all the other areas theyre in as the Analyst Communitys clearly focused on, it seems like a sensible, rational move. It will definitely provide more transparency and thats what management said yesterday when they made the surprise change, of course. And now allowing the company to still make those risky bets, as they said as well, in drones and health care, at the same time focusing on their core strategy and core growth product, which is Search Engine optimization. I just wonder as a shareholder, do you want to make sure you have exposure to both fields, Search Engine optimization as well as the new investments such as drones and health care . That will of course be the big question, because this change means you have two separate companies in a way. We have alphabet, which is focused on the new, cooler areas of investment, then your primary google, which is focused on chrome and search. So, we will see what this means for the shareholder and how they react to this change. But its a management change, not in terms of exposure. If you own alphabet, you still own the same entity, its just underneath the Management Structure has changed. Organizational, not just management. Indeed, but in terms of the shareholders, it will still be, the google part will still be fully owned by alphabet and thats just what youll have exposure to in the share price. Interestingly, it is still the same sort of five or so people at the top in the helm, so even if youre changing this structure, will it still be led very much by larry page, by the founders, by eric schmidt, or will other people start having much more of a say . Well have to see. I think it will be different because you will have these leaders, these leaders, of course, founders as well, sergei and larry, focused more on the new areas of investment, where now you have a rising star of silicon valley, sundar pichai, who went to stanford, got an mba at wharton, has been leading chrome for many years, now the ceo of google, continuing to be focused on internet search optimization. We want you to get in touch with us. Is it a good move by google . Worldwi worldwid worldwide cnbc. Com or cnbcwex is the twitter handle. Still to come, recession in russia. We look at the flagging economy as Lower Oil Prices take hold. Dont go away. White smoke in athens. Greece reaches a bailout deal with over a week to spare, but the countrys creditors are still left to iron out the final details. Currency curveball. China devalues the yuan in a bid to boost the countrys flagging economy. The surprise move sending shares in europes auto and luxury stocks lower in early trade. Shares in prudential recover from earlier lows as ventura post a 15 rise in operating profit and raises its dividend, declaring its strategy as the right one. Easy as abc . Google creates a new umbrella company, alphabet, in order to simplify its structure. Sundar pichai stepping in as new ceo of the Search Engine business. Stocks around the world reacting to that devaluation plan from the pboc, specifically the exporters weighing here on european equities. The xetra dax down around 90 points as auto stocks move to the down side. The ftse 100 right now down around 32 points, and were looking at the french and italian markets also trading lower, although italian markets basically flat. In the meantime, lets look at commodities. Yesterday it was really interesting, we saw gold rally to its highest level since june of 2015. So, a rebound in gold prices. Some of that having to do with the weaker u. S. Dollar. And here, again, we are looking at gold up around 8 in todays trade. Brent crude, interesting enough, slightly higher on the day, while wti crude hugging the flat line. Lets have a quick look at bonds. Not too Much Movement over the course of the last couple of trading days, just below 2. 2 for the u. S. Tenyear and below zero. 7 for the german tenyear. We did see a little bit of a recovery in places like italy and spain off the back of the greek deal but nothing too significant. A quick look at forex as well. The euro dollar hasnt moved too much off the back of that deal. We are back above 1. 10. We crossed that late yesterday, so a little recovery in the euro over the last two days, but small moves as august would dictate. Now, we have had almost a 1 decline in the aussie dollar off the back of that chinese decision to allow its currency to devalue by a couple of percent. Now, i want to bring some flashes out of the german financial regulator, saying that they plan to conclude their investigation into forex manipulation by the end of 2016. Theyre saying that german banks woke up late to the scale of the problem and the extent of the problem is nothing to be relaxed about. So, of course, that investigation by bafin, the german financial regulator ongoing and due to be concluded by the end of next year. Moving on, russia has fallen even deeper into recession as the economy contracted 4. 6 in the Second Quarter. The decline was greater than expected and represents an acceleration in the trajectory of russias negative growth. In the first quarter, gdp fell 2. 2 . With more about the forecast for russia, christopher granville. Christopher, thank you so much for joining us here on Worldwide Exchange. Thank you for having me. Im sure russia keeping you very busy this summer. Well, theres never a dull moment. Your images in the background showed russia in winter, a snowbound kremlin, which is perhaps an apt symbol for the state of the economy, although there is a heat wave this week in moscow and Central European russia. I am sure. The thing about these economic indicators, it was a bit backwardlooking. The recession has almost certainly russia bottomed out in the Second Quarter or transitioning into the third, so that very alarming number, minus 4. 6 yearonyear decline in output. If you look behind it, you see that in june, most of the indicators are turning. So, the rate of decline is slowing, especially in real wages, industrial output, real disposable incomes, fixed asset investment. So, the corner has been turned, but thats nothing much to celebrate. Were due to tank down another 20 . Were revisiting oil prices, of course, similar to where we were at the back end of last year. Is the pressure on russia as high as it was nine months ago . Well, i think that my other point would be no. So, not only is the economy bottoming out, but the alarmingly sort of sharp falls in oil with the Ruble Exchange Rate falling behind, in fact, just complete a roundtrip. As you say, were to where we were the beginning of the year. So, the real brunt of this shock has already been felt by russia, and this deep recession is simply the logical effect of what happened last winter, really. Well, i was just going to say, ongoing difficulties appear to have left russian policymakers really struggling to balance these simultaneous goals when it comes to suppressing inflation and kickstarting growth. What do you think is their number one goal right now . I think its to drive inflation down, because although policymakers the world over juggle with this dilemma, the sequence in most countries and i would argue most especially in russia today is to get inflation down first. First and foremost, because that will result in a recovery of real incomes and a recovery in consumption. Thats the best, most reliable way to get growth kickstarted. But more importantly, only by getting longterm, mediumlow inflation rates 4 is the russian Central Banks mediumterm target is there any chance of meeting russias longer and deeper growth challenge, which is investment and less inflation. Its low, you wont get a lot of investment confidence. A lot of conditions have to be met, but thats the first one. Over the last 12 months, has the central bank gained in credibility in your eyes or lacked credibility . In my personal eyes, its gained enormously. I think that the central bank under the leadership of elvira has done an outstanding job in this crisis and theyve also deepened a longterm strategy to move to a credible inflation targeting regime. Now, thats an unfashionable view. Whenever theres a crisis, its always easy and credible to disparage central bankers, and god knows if you or i, wilfred, being in their shoes, thats the thing of it. Its easy to make mistakes and not claiming theyve got everything right you would have done a stellar job, i have no doubt. Still, and its a great team and the Russian Central Bank, that i think is something which investors are pretty much aware of. And you can see that in the local currency fixed income market, where yields continue to compress. Basically, investors think that inflation will continue to come down. Obviously in a deep recession, thats not such a big ask, but the Central Banks policy is helping, and that bet on the local currency bonds, despite the oil price fall, despite the ruble backing up, is a good one. Lets bring this back to the markets. Given the renewed drop in oil prices and the challenges that the Russian Central Bank is facing, at one point, we should point out, the russian stock market was the best performing emerging market, just about two months ago. That, of course, has changed. Would you be a buyer of russian stocks here, just given valuation alone . I think this tantrum were seeing globally, in Global Emerging Markets over the imminent u. S. Interest rate hike, which is transmitting itself to russia through the oil price with china, of course, another strong contributor, that whole scenario i think will be a question of sell on the rumor, buy on the news. Once the fed has done its stuff next month, if the Market Expectations are borne out, i think high betatype markets like russia, which has suffered more, will be in that much better place to bounce back. All right, well leave it there. Christopher granville, thank you so much for joining us on Worldwide Exchange, managing director at trusted sources. Now, moving on to earnings, shake shack has served up a set of impressive secondquarter results. Morgan brennan breaking down the numbers. Shares of shake shack soaring on monday after the closing bell with the company posting a tasty beat on the top and bottom lines. But the standout number, sameshack sales, or the companys samestore sales growth was 12. 9 . That was much higher than anticipated. The fast casual burger chain opened three domestic companyoperated restaurants last quarter and two internationally. And on the call, ceo randy grudy saying the companys on track to expand restaurants faster than originally anticipated. Development conditions remain favorable for shake shack. And as a result, our team has been able to increase our pace of openings to exceed our originally stated guidance of at least ten new domestic companyoperated shacks in 2015. We are confident that we will now open 12 new domestic companyoperated shacks in 2015. Management also noting the Development Plan through 2016 looks strong with plans to open at least a dozen stores in the u. S. Annually next year as well. And shake shack also raising fullyear revenue guidance and hiking samestore sales growth to mid to high Single Digits for 2015. But for all the upbeat numbers in a separate release, shake shack announcing a 4 million share secondary offering as well, though the company will not see any proceeds from that sale. Overall, investors seem very pleased with shake shacks Third Quarterly Report as a public company. Shares climbed more than 8 following the results in after hours. Back over to you. Kraft heinz reports secondquarter results, first since the two Food Companies merged in a 50 billion deal last month. Revenue fell at both companies. Sales dropping nearly 5 at kraft due to weak demand for its beverages, which include koolaid and capri sun and a result of fewer promotions than last year. Sales fell 4 at heinz, mostly because of the strong dollar. Lets look at share price action, down around about 2 in afterhours and down a similar amount in german trade today. Uk retail spending took a hit in july with the British Retail Consortium blaming the soggy figures on wet weather raining off barbecues. Spending grew by 2. 2 , down on the nearly 3 rise recorded in the month of june. Now, food sales dropped unexpectedly with wetter weather than 2014 impacting all fresco dining. Try to say that three times, wetter weather. Wetter weather. Wetter weather. Weve already had enough stumbles this morning to try that as well. Meanwhile it brings a whole new meaning to the phrase rocket launch. Let us take a look at this story. Oh, gosh, who wrote that . Love that. Anyway, i apologize for even reading it. Now, lets keep going. Astronauts at the International Space station have taken a bite into the first ever spacegrown lettuce. Scientists developed the red romaine leaves to allow astronauts to grow their own food, making possible Human Missions to furtherflung areas of the solar system, such as mars. The iss team tried it raw before adding olive oil and balsamic vinegar to the lettuce. Their verdict tastes awesome they say. Or should that be out of this world . I am not all that impressed. I mean, once they are actually able to grow carrots and maybe radish and make a steak up there, thats when ill be impressed, but just lettuce, big deal. One small step, you know . Okay, fine. At a time. Come on. I guess youre right. I guess youre right. All right, lets switch gears here. Californias pebble beach is set to play host to some of the worlds finest cars and most serious collectors this weekend. So, what are the motors to watch out for . Robert frank has the details. Classic cars have also been the top collectible investment over the past year and the past ten years, but the biggest test for the market will be starting thursday at the auctions at the pebble beach concours delegance. 141 cars are expected to sell for 1 million or more. Just by way of comparison, in 2010, just 36 cars sold for 1 million or more. There are over 128 vintage ferraris selling, so well see whether theres really demand for all those ferraris. Among the most expensive, this 1956 ferrari 250 gtcompetizione, sold for between 15 to 20 million. They also have a 250 lm. This is beautiful and could fetch 22 million. A ferrari ridden by the pope. And now, the mcclaren f1lm, with the price topping 12 million bucks. We could also see the most expensive porsche ever sold, 1982 956. They won the 24hour le mans and could hit 9 million. The koenigsegg used in fast furious, could top 12 million. And the americans are coming up fast. This 1970 plymouth hemi cuda convertible could be one of the most expensive american cars ever sold. It could hit 3 million bucks. Robert frank, cnbc. Im going to be really boring on this, seema. I dont get it. If i wanted to spend money on a car, i want it to be modern, efficient, with all the added extras. Collectible car . Doesnt do it for me. Because you can only look at it. Youre not really going to be riding it that often or driving it i presume these enthusiasts i hope they drive well as well. I hope theyre not just to look at. Theyre also a collectors item, so you have to be careful and not take them out to the country every weekend. Youre probably not going to, like, jazz it around late at night really fast, but theyre definitely still operational, though, arent they . Theyd better be, otherwise its more stupid. Operational, but i think you have to be careful and not use them on a regular basis, perhaps. Just so you know for christmas, i love a range rover. Ill write they down. All the extras, probably like a dark red. Good, good. Keep the wish list going, all right . Still to come on Worldwide Exchange, in the face of escalating violence, can turkeys leading parties come together to form a coalition . We bring you the latest on the political situation in the country. Thats coming up. Lets get you caught up on the prudential story. Prudential posting a 17 jump in the first half operating profit, this as prudentials asia boss says it sees strong growth in agency, banking distribution, strong sales also to mainland china. It also says that the china stock market volatility has not had much impact on its business. Of course, that was one of the concerns for analysts out there ahead of prudential reporting results. Prudentials ceo says its confident of delivering strong and profitable growth and has put in a request for lifting of the trading halt. As you can see, it has been lifted. Were looking at prudential shares higher by around 0. 3 . The United States has led 29 air strikes in iraq and syria, targeting Islamic State positions. The u. S. And its allies, including turkey, destroyed an explosives factory and other strategic isis operations in the mission, this after nine people were killed and numerous others injured in a wave of attacks across istanbul on monday. The leaders of turkeys Ruling Ak Party in the Main Opposition Republican Peoples Party will make a final decision this week on whether to form a coalition government. This according to reuters. The first round of talks ended without conclusion. Parties have until the 23rd of august to agree to a working coalition. Otherwise, president Tayyip Erdogan could call a new election. Joining us down the line a country risk analyst. Thank you for joining us. Lets talk a bit about turkey. Of course, weve had that round of Violent Attacks over the weekend and yesterday. Do you think that has a direct relationship with the fact that we havent got a strong ruling government right now . I think theres definitely an inherent current connection between the intensification of fighting in turkey and the situation on the political scene. It might be the case that the ruling party, the akp, is calculating that with its renewed defensive against the pkk and the Islamic State, for that matter. It stands to increase its votes in a potential snap election, which would be likely to come later this year. And lets talk about whether we will see a snap election. Of course, weve been in limbo since the seventh of june elections. Do you think were close to reaching a coalition or would you say the most likely outcome now is another round of elections . It has been quite a while since the conclusion of the general election in early june this year, and we have seen insignificant progress until this point. And we assessed that, provided president erdogans tendency to exert his informal influence over the government, its unlikely that he would prefer a coalition option and probably uses his clout over the ruling party to push for a snap election, which would be likely to come in november 2015. Do you think the recent escalation of fighting, not just what we saw yesterday or the violence yesterday, but the fighting between the government and the separatist group pkk has been impacting Investors Sentiment on the ground . By all means, definitely. One of the biggest problems for turkey is that it has a chronic current account deficit. And this renders the economy vulnerable to political instability as well as violent events in the country. And we have seen the impact of this in the volatility of the lira in recent weeks. And with the potential renewed elections near, this is likely to increase. Speaking of the economy, weve seen a sharp slowdown in growth. I mean, back in 2012, turkey was growing at around 7 to 8 . Here in 2015 at 2. 5 . Ege what else do you think needs to happen to turn around the economy . Does it just come down to government reform . I mean, one of the key factors is definitely turkey needs to increase its domestic saving rates. And this will depend upon structural reforms, which will be costly in the shorter term for economic outlook. And this will require longerterm government stability, a government that can bite the bullet, so to speak, in shorter term. Of course, we cant discount the global dynamics, namely, the federal reserves intention to taper this year and the impact this is having on emerging market economies. And ege, do you think overall that snap elections would be bad for the economy . I mean, potentially, that would be the case in the short term, but if it did, in fact, lead to no need for a coalition in the future, will it be something that markets would welcome in due course . In the shorter term, they would welcome it, because it would bring them back to the comfort zone of having the akp as the single ruling party. However, in recent years, we saw that this unchallenged dominance of the ruling party in the turkish political scene came at the cost of things such as central bank independence. The government was exerting a lot of pressure on Monetary Policy as well as other privatesector regulatory bodies, which was coming at the cost of Investor Confidence in the turkish economy. Ege, just to round things up, whats your view on mr. Erdogan . Is his power waning . Is his time up, given the fact that he failed in june to get that overall majority . Much harder, of course, for him to exert pressure as president on the government if he hasnt got a ruling majority. Everything will depend on whether we see a snap election, and if this is the case, whether or not the akp will be able to regain its majority. If we see that the government goes ahead with the renewed election and they, in fact, lose once again to get the majority, we might even see a fragmentation of the akp, and this would probably signify an irreversible end to erdogans power in the country. Ege, thanks so much for joining us, country risk analyst at ihs. Switching focus to japan. Japan has restarted one of its Nuclear Reactors for the First Time Since the Fukushima Nuclear disaster in 2011. Our nikkei correspondent is joining us live. Makiko ustuda. The sendai power plant was reacted today for first time in four years. It was the first time to go back online under a set of new, more stringent regulations put in place following a series of meltdowns at the fukushima plant, which were triggered by the massive earthquake and tsunami. The plant was chosen partly because the area thought to be less prone to be hit by a major earthquake. But still, its safety remains to be a major concern and dozens of protesters gathered in front of the plant opposing the restart. The plant is currently on a test run, and if all goes smoothly, it will start supplying power commercially in early september. Reactivating the Nuclear Plants has been one of the Top Priorities of the Abe Administration as japan has been relying on imported fossil fuel for its energy at a huge cost. And a total of 25 plants have applied for reactivation and only 5 have passed the new safety regulations so far. Whether they will be put back online depends on how the sendai plan performs, and all eyes are watching how it runs. And thats all from the nikkei. Back to you. Makiko, thank you so much. We have a flash here. Were just learning that the Indian Government has introduced the goods and Services Tax Bill to the upper house of parliament. The big question now will be, will the upper house of Parliament Pass this gst bill, which of course, is something that the finance minister of india has been working on ever since coming to power in 2014. Of course, theres been a lot of speculation if this gst tax would come together. It seems as one of the ways indias trying to liberalize their tax system, and here you go, introducing the gst bill to the upper house of parliament. The big question is, will it be passed . Were looking at the s p sensex slightly lower in todays trade. Moving on, the sendai power plant operated by kyushu electric power located in southern japan was reactivated today for the first time in two years. It was the first to go back online under a set of new, more stringent regulations put in place following a series of meltdowns at the fukushima plant triggered by the massive earthquake and tsunami four years ago. Of course, that was the story that our nikkei correspondent brought us. Moving on, were going to talk more about its been a mixed month for hedge funds. Cnbcs kate kelly explains which managers have made gains and which have lost ground. There was a huge disparity in Hedge Fund Performance this past month, even among some of the flagship names in the business. Some Major Players in the stock market were really killing it, impressive in a year where the s p is up only a couple Percentage Points and the average hedge fund is almost totally flat. Citadels Equities Fund was one example. Although its a momentum type of shop, its holdings can be hard to decipher at any given time. A snapshot of its recent long filings suggest that major positions like amazon and Dollar General helped drive returns, pushing it up 3 for the month and 14 through the year overall through july. Pershing square is also doing great, gaining 7 in july. No doubt helped in part by its new position in mond lees and finishing up the month up 10 overall. The private hedge fund run by steve cohen had a flat month but a great year overall, up 11 at last check. Other funds, though, are having a rough go of it. David einhorn, one of the most respected stockpickers out there, saw a reversal of 6 in july, bringing his fund, greenlight capital, down 9 for the year overall. At least in part, it seems, on long positions in energy like consol and sun edison. Also worth mention, andy halls astonvet capital, although not primarily an investment fund, the commodity shop lost nearly 17 in july, bringing its yeartodate losses to 15 . For good or ill, however, hall remains bullish on oil, saying repeatedly, including in his early august letter, that low oil prices will be the cure for low oil prices. Back to you. All right, heres whats coming up on Worldwide Exchange. Ebay keeping the competition at bay. Were going to talk about the Online Marketplaces new content strategy thats designed to win over younger shoppers. Thats coming up next. I hate cleaning the gutters. Have you touched the stuff . Its evil. And ladders. Sfx [screams] they have all those warnings on em. Might as well say. youre gonna die, jeff. you hired someone to clean the gutters. Not just someone. Angies list helped me find a highly rated Service Provider to do the work at a fair price. Everyone can shop, but members get more with reviews, live customer support, and better pricing. Come see what the new angies list can do for you. Welcome to the second hour of Worldwide Exchange, everyone. Im seema mody. And im wilfred frost. Here are your headlines from around the world. Currency curveball. China devalues the yuan in a bid to boost the countrys flagging economy, but the surprise move sending some of europes luxury and auto blue chips lower. Greece reaches a tentative bailout deal, but the agreement fails to lift sentiment in stock markets. The dow and s p also pointed to a lower open, despite yesterdays energyled rally on wall street. Easy as abc. Google creates a new umbrella company, alphabet, in order to simplify its structure, sending shares in the

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