Interested in a deal with ge as it scraps its dividend. While media reports suggests siemens is pulling out of the bidding. And investors react to the vicious business plan, they say the ceo is being too optimistic with his turnaround goals. Youre watching worldwide exchange, bringing you Business News from around the globe. Hello, warm welcome to todays edition of worldwide exchange. Plenty to get through today. Well be talking about autos, phil lebeau will be talking about tesla. Well talk about janet yellen. First, alibaba has filed fon an ipo after weeks of anticipation. The filing offers a look at a business that controls around 80 of chinas online commerce market. Eunice is in beijing for more. Shes been waiting for this for some time as well. 2,300 pages in this filing. But key questions unanswered. Definitely key questions unanswered. I think everybody wants to know wheres the price, how many shares are going to be sold . Give us more detail exactly about what this ipo is all about. Mainly because a lot of investors are going to know what the valuation is going to be, whether or not this is worth their time. Is it going to be worth the risks and the Corporate Governance issues, the corporate regulatory issues. Some people say wed like to see a discount to invest in this company. Theres plenty of good stuff to say about alibaba. It is, as you noted, a behemoth in the ecommerce industry here. It controls fourfifths of the Online Retail business. And that industry is expanding. It has 231 million active users. It has 248 billion worth of goods that are moving across its site. So the question Going Forward is, they are twofold. One of them is that a lot of people are wondering about the competition, the competitive environment here. How long alibaba will be able to remain that Massive Player in the market. But also and more specific to this ipo are a lot of questions about the regulatory and Corporate Governance issues around this. There have been plenty of people complaining that its unclear at least doesnt seem very optimistic about how investors will be able to have any influence over the board. The way that its structured really indicates that the management and in fact just the founders would be able to have a complete control over who gets on the board and the direction of the company and a lot of investors and shareholders just might not really be turned on by that. Ross . Plenty to get to. You talk about the governance issue. We know where they are going to list, the new york or nasdaq. We dont know if theyre going to choose the nyse or the nasdaq. Traditionally, there has been Tech Companies listing on the nasdaq but theres been a lot of movement on the nyse. The reason people are uk toing so much about the Corporate Governance issues, theres a lot of suspicion and discuss about how alibaba would have pursued or at least had pursued the new york listing as opposed to a hong kong listing because of the regulators in hong kong. The regulators wouldnt have allowed the Partnership Structure that the alibaba management wants to keep in place so they can have a lot more control over the company. And thats something that a lot of investors dont like to hear. They dont like to hear there isnt a lot of transparency in the decisionmaking thats going on, especially when the company is raising a lot of money. They are going to be putting more cash in their coffers. They have been on this acquisition trail. A lot of people want to know what theyll be doing with that money and whether or not this is a worthy investment. Ross . Plenty more to come from eunice in beijing. Plenty more on alibaba as well. Head to cnbc. Com to find out plenty more on those numbers. Meanwhile, here we are, just over an hour and five minutes into the trading day in europe. You can see we are weighted to the downside this morning. A little bit less than 73 decliners outpacing advancers. European equities, the ftse down 23 points yesterday, the dax down 0. 6 . The xetra dax is flat, the cac current is off 0. 2. The ftse mib is down 0. 6 as well. The u. S. 30, the tenyear yield down at threemonth lows. Were running off of that at the moment, 2. 58. The big focus will be two days of janet yellen testimony. It starts today. How dovish is she going to be . Well talk about that later as well. Italian yields also following spanish yields below 3 . On the currency market, the dollar index is down near sixmonth lows. Were on that at the moment, euro dollar, yesterday hit 1. 3952. A twomonth high. Were sort of just below that. Well keep our eyes on sterling. We got close to the 170 mark yesterday. 1. 6972 is where we stand at the moment. Not far away from a fiveyear high. A number of individual stocks were looking at today, fiat, down 8 . Yesterday fiat had an allday briefing to investors. But theyve reacted negatively to sergio ma markhionnis plan. Hen henkel up 3. 5 , this on the back of strong emerging market demand for washing powders, Beauty Products and industrial adhesives. Sky deutschland up 3. 5 . Revenue at around 419 million euros. The company added 64,000 subscribers in the quarter and also announced record retention levels. Finally, up 2 today, natixis. Speaking to squawk box, the ceo was asked about investment decline activity. It has been difficult because the activity of clients have been declining compared to what it was for the last quarters. We think it is not a longterm trend. We think fixed income will peak up again. We are devoted to developing our fixed income business in europe and also in the u. S. Where we have invested significantly in our platform. We have tim harris this morning. If you took ukraine out of the picture, where would we be. Emerging markets is as much about araby and china and the risk assessments in ukraine. I was thinking about overall sentiment. Theres a Tipping Point there as well. Hes trying to turn emerging markets up. Were showing inflows beginning to come back in. Thats a sign of Risk Appetite thats building in that part at least. Coming back to your core question, economic rates running in excess of 3, it looks better and european retail sales, some of the surveys looking better. The underlying store is one where earnings and momentum will move from negative to positive throughout the year. Were looking at growth in the high single digits. Valuation, europe at least in the 13, 14 level is not excessive. Thats a recipe for equities driven growth through the balance of the year. We saw so far, earnings on the whole beating the average. Exfinancials, yes. On the other hand, sales arent. Yes. Weve been talking about this for a number of years, the quality of the earnings. I think we do care. Obviously theres a little bit of Balance Sheet restructuring in there, the cost of capital. Theres also margin, which companies are squeezing out. The top line should come back if youre looking at domestic growth of 3 . Thats real. You put an inflation rate on top of that. That should manifest itself in corporate top line growth which should come through later in the year. Thats on the domestic side. If we look at the export position, obviously as the dollar weakens, that must improve terms of trade for u. S. Companies and that must manifest itself, again, in earnings as the year comes to a close. The earnings picture for the u. S. Looks brighter today than it has for six or nine months. The dollar of index is down today. Your forecast is the dollar strengthens. Isnt that going to impinge on this . Its a 1. 30, 1. 40 range. I dont think that kills or cures the u. S. Recovery. From a dollar u. S. International company. Its a help and a hindrance. But i think where were near these ranges, its not the key driver. I think u. S. Corporates over the last five years in particular have done an immense amount to improve their competitiveness, their labor, turnover, the use of capital, the cost of capital is being carefully controlled as well. I think the u. S. Corporate sector is in good we avoided the Banking Sector there. Coming up, well hawk about hsbc. Well have the First Quarter numbers with analysis, straight after this. Having the cloud allows us to rapid prototype a lot of ideas. Being able to pay as we go is crucial for a start up. Having to fork out a lot of money up front was risky. We can launch a feature really quick, and if the feature doesnt work, we havent lost anything, and we can have something up and running in days. And this would not be possible without the cloud. We are now supporting over 25 million users each month. Youre watching worldwide exchange. Just remind you where we stand, just an hour and 15 minutes into trade, european equities are down. Talking about hsbc, we didnt recap the hsbc market. Activity coming in slightly slower clip than in march. 51. 4 in april. 51. 9 in march. Employment growth also down at a sevenmonth low. I thought wed put that one into the mix. We just wait for hsbc numbers. We are looking for the pretax profit to be down somewhere around 10 , 11 , should come in at 6. 92 or 6. 93 billion this morning. Joining us in the studio our two guests. As we wait for the numbers to come out, the key for you . The key for us is impairment. We want to keep a close eye on, see whats going on in asia. Pretax profit has come out, down 20 in the First Quarter of 2014. I think thats lower than anybody was looking for, 6. 785. 6. 785. The underlying down to 968 million off 35 at 6. 621. Thats the underlying profit. Return on the shareholders equity, 3. 2 lower at 11. 7 . Lets see if we have anything else. Reaction to that number first . Whilsh we wait for more details. That number is about where the consensus was. We were looking for a number slightly actually lower than that. Thats slightly better. In terms of the return equity, 11. 7. They want to be achieving higher than that. Ill be quite interested to see where the cost income ratio is on the numbers coming out here. Yes. Still waiting for that to come through. They come out in drips and drabs is the problem with this, edmond. Transitional basis, seek capital ratio 10. 7 , down from 10. 8. Yes. We are aware there was going to be pra adjustments coming through for the First Quarter. Its something they stated in the Fourth Quarter results. What were interested here is to find out if they can kind of outline what the capital plans are. This is something the other companies in the uk bank sector has done. Were quite interested to see if thats possible. Yes. Here we go. Hsbc, loan impairment, 798 million versus 1. 17 billion last time around. Thats a very good number. Thats a much lower impairment. Thats following from the trend we saw in the Fourth Quarter. I think we are looking around above 1 billion. Thats much lower than we would have thought, which would imply the actual Net Operating Income is probably slightly lower than expected. Which can be taken poorly by some analysts. They kept the dividend as well at 10 cents a share. Operating expenses, 8. 85 billion versus 9. 3 billion as well. In the comparison. Thats another good number. Operating expenses is something that management has been very keen to outline is to kind of reduce the cost base and bring down this cost income. Without that number there, its actually slightly better than we would have thought. Quite positive on that. They talk about muted customer activity. Tim, what do you make of the bank sector . Its the Investment Banking side which has pulled back most of the global majors. I think youll find hsbc will be an exception. As we move into midyear, that part of the cycle should improve. Obviously equity markets are still at the moment. Bond issues are picking up. We are beginning to see the mergers and acquisitions global activity pick up, were talking about alibaba this morning. Were beginning to see new insurance come back into markets in both equity and the bond side. There is value in banks. I dont think theyre particularly aggressively rated. Hsbc, the share price terms, its been one of the more disappointing performers of the majors. You get a 4 dividend yield. You mention the last 12 months. Hsbc down 15 . Bank sector up 12 . Why is it such an underperformer . Its been pushed on the top line. The revenue numbers have been much lower. Theyve been revised down. Its theme of the sector at the moment. Theres been an exposure to the emerging markets that have seen a down trend in its top line numbers. Is it time for it to play catch up or not . It looks as if management will begin to deliver on the cost base and that will give people impetus to focus on 2017 on a kind of various ratios, cost income ratio which is attractive, there are degrees of ideas that people can say, yes, its become more attractive. Stay here. There are other bank news we want to get through. Well get your thoughts on that as well. Other banks reporting today. Frances socgen, blaming uncertainly because of situation in the ukraine for the charges as well as the decline in the value of the ruble. Apart from russia, net income of soc gen. French rivalen joyed a near 30 net income. The lender says its fully committed to implementing its medium term strategic plan. Improvements across Eastern Europe helping to boost the bottom line of commerzbank. I suspect anybody with Russian Operations that may become the story. I think socgen has had a bit of a lead when the markets opened up in the 90s and the early part of the millennium. Yes, youre seeing this is a theme. Anyone with activity which is exposed to that part of the world is reassessing. We know russia will face recession this year and we know things will be difficult. Socgen has exposure in that part of the world. Its interesting to control. You look at where it contrasts with that, very key. It is a retail and commercial bank. Its a key player in the French Economy and its interesting again. Retail banks just beginning to move ahead. Lloyds, for example the lloyds share price is up 40 over the past 12 months. Lloyds has done a fantastic job focusing on the uk retail and building up its capital base. The combination of those three has meant a sweet spot for what investors are waiting for. Then it was on cost and its trying to control the Investment Bank. Well hear more about it tomorrow. What do you think they need to detail tomorrow to gain Investor Confidence . They have to reaffirm where their main priorities are in Investment Banking. They have large market share in various operations. We know the cyclical and structural decline in fixed income, commodities and currency. What were looking for, where can it go, what market share can it retain and where is it losing out . Obviously its cost income ratio. The amount of cost, a percent of income will increase as employees require further increases of payments and as your income is diminished. Were looking for not a complete change but a reaffirmiation. Tim, before we let you go, i wonder what your view is for fixed income. These things are transient, ross. The fear at the back of our minds is where bond markets go in the u. S. I think were going to get more clues. I think chairman yellen understands the power of her house. Does the flattening yield curve make sense . 30year yield on friday hitting an eightmonth low. The tenyear at a threemonth low. Theres an excellent piece this morning talking about the clues the bond markets have given us. He argues very correctly that theres a little bit of there today. Tenyear bonds have to sell off, havent they, because things are Getting Better and there will be inflation pressures in the u. S. And uk, for example. I think if the markets continue to hold and we are seeing both corporates and governance coming back, the muni markets looking much happier in the u. S. As well. I think the markets look more stable. I think coming out of that dip of q1, again, as we move into midyear, numbers should begin to look better. Tim, always good to see you. Tim harris from harris capital. Good to see you as well. Thanks for coming in and helping us dissect on the fly those hsbc numbers. Always very grateful for the help, i can tell you. Thank you both. Chinese ecommerce giant alibaba has filed for an ipo. They control about 80 of chinas Online Ecommerce market. Jane wells filed this report. Lucky, just lucky. Reporter jack ma may be lucky but hes relentless. He launched alibaba, no one would open sesame to help him. I was rejected by so many venture capitalist when i talk about alibaba, they look at me strange, alibaba, what are you talking about . I went back to china with nothing, no money, nobody invested in me. But i was full of confidence. I saw the american dreams. Reporter the dream of hard work paying off. It did. Alibaba has grown into chinas largest ecommerce platform, beyond b2b, retail, online payments and more. Making this 49yearold former teacher who taught himself english worth 9 billion. We are still very careful for every penny we spend. Reporter ma is funny. Hes a different type of chinese businessman. Are you going to buy yahoo . Good question. Yes, we are very interested in that. Reporter he has a knack for analogies. This talk is just like like a peace talk on the united nations, very complicated. I call myself like a blind man riding on the back of blind tigers. Reporter he insists on telling everyone about failure. Like most companies we made hundreds of thousands of mistakes. We made so many mistakes. We were so stupid at times. Reporter jack ma believes you dont learn from other peoples successes but from the stupid things they do. As the company he founded prepares to go public, ma says his business philosophy is customers first, employees second, shareholders third. And he remains a dreamer who has defied critics inside and outside china. We find the best managers in finance, technology and marketing. My job is every day tell them the dream. Reporter for cnbc Business News, im jane wells. Plenty more to come on alibaba. Plenty more online as well. Still to come on the show, no one likes a flat beer. How will investors react to carlsburg missing expectations . We speak with rasmussen in just a few moments. Passenger road trip buddy. Lets put some music on. Woman welcome to learning spanish in the car. Passenger youve got to be kidding me. Driver this is good. Woman vamanos. Driver passenger vamanos. Woman gracias. Driver passenger gracias. Passenger trece horas en el carro sin parar y no traes musica. Driver mira entra y comprame unas papitas. Vo get up to 795 miles per tank in the tdi clean diesel. The volkswagen passat. Recipient of the j. D. Power appeal award, two years in a row. Youre watching worldwide exchange, bringing you Business News from around the globe. Headlines from around the globe, alibaba takes the First Step Towards what could be the worlds biggest tech ipo. The chinese ecommerce giant files for a u. S. Listing and reveals its handling more transactions than amazon and ebay combined. Hsbc saying its seeing continued muted customer activity. Keeping their options open. Alstom says it might be interested in a deal with ge. The media reports siemens is going to pull out of the bidding. And fiat shares slump. Investors react badly to the carmakers ambitious business plan. Investors say ceo marchionne is being too optimistic with his fiveyear turnaround goals. We are an hour and a half into the trading day here in europe after falls yesterday, the ftse off by a third today, the cac current off by a third. Fiat having a marked impact on the ftse mib which is down almost 1 . 2. 57 was the yield we hit on friday. Gilt yields down at 2. 65 and tenyear italian yields following spain below the 3 mark as well. The currency market, the dollar is off across the board. Dollar yen, 101. 52. The euro dollar hit a twomonth high of 1. 6952. Carlsberg, the beer giant cut its earnings forecast after missing expectations for the First Quarter. He cited russia and ukraine as the main culprits for the decline. Joining us from copenhagen, jergen rasmussen. What are your assumptions about the decline in that market . Can i make a point that quarter one as im sure youre aware is a very small quarter for the Beer Industry and certainly for carlsberg, accounting for maybe 5 of annual ebits. We say not to read too much into numbers on a small quarter because that can do a lot to yield comparisons. Back to the question about russia, yes, we thought going into the year that the russian beer market would finally get to a point where it would be close to flat or slightly declining. And then we have this event happening in ukraine and crimea. Having a very negative impact on the russian macro economy, we believe. We see signs of that. We think if anything it will only get slightly worse. That will also negatively impact the consumer and Consumer Sentiment in russia. Thats why we have changed our assumption for the beer Market Development for 2014. We are now saying midsingle digit decline all driven by the issue around ukraine and between russia and ukraine and eu. Yes. I suppose, its difficult to forecast what will happen because it is a political situation. All you can do is concentrate on your side of the business rather than the demand. What will you do to protect yourself . What we have said also this morning, we have said it is an underlying performance. If you dont include Currency Exchange rates, our outlook for the year is that as it was in february. Lower expectation in terms of russia and russian market. Because of Strong Performance in western europe and positive performance in asia, we believe we are able to compensate across the group for a more negative development in russia under underlying organic business. We have taking down assumption on Exchange Rates. So in reported terms we are saying wed deliver low single digit increase in earnings and no longer midsingle digit increase in earnings. Thats mainly driven by the worsening or the worst outlook for the ruble versus euro. Lets talk about elsewhere. Western european sales up 2 . Asian sales up 21 . Lets talk about the main market in western europe at the moment. What do you foresee demand levels like over the rest of the year . Western europe is, lets say from a volume point of view, the market is in small decline, probably 1 , maybe 2 . But in value terms its slightly up, the beer markets in general, we are doing well. Weve done that three years in a row, weve gained markets across western europe. We believe well see more of the same. If you talk about profitability in western europe, thats driven by the fact we change, how we work, our business model. We do Value Management to optimize our investments. So we can really drive profitability in western europe despite maybe from a volume point of view, the market is not growing. And asia, its still a growth region. We dont see a big change in ourationen markets compared to last year with the exception of vietnam where the economy is not great and therefore, the beer markets in vietnam is not fantastic but apart from that, i would say well see more of the same in 14 as we saw in 13. Growth in asia, were still doing well. We have gained control in a part of china. Jorgen buhl rasmussen, thank you for your time. Ceo of charlesburg. The budweisermaker has upped its marketing spend ahead of the world cup this summer. They sold more beer in every region, apart from here in europe. Numbers particularly strong in china and brazil. Siemens has unveiled its Second Quarter profits which disappointed in a charge. Siemens could be withdrawing its bid for alstom. This is after the ceo told Bloomberg Television that he wont be forced into an offer for the french firm. And that has got more details for us in frankfurt. They are doing an energy deal with rolls. What do you think their real view is on the perspective of the ge alstom tire . They probably think its a difficult bid to win. But they also are thinking that, first of all, look at the data, which is called the data room, of course. We do that Due Diligence and then decide whether its worth to make an offer. Those reports right now are actually a little bit misleading, i would say. As joe caseza was talking, they will decide whether they make a bid or not. Those reports that are the quotes theyre not letting them being forced into a bid for alstom also has to be with a certain perspective. At least here in germany there were reports that siemens is just playing a role in that bidding process so that ge has to pay a higher price for alstom at the end of the game. And that might actually be a reply to those rumors. So enough regarding alstom. Now we are talking strategy here for siemens. The shares are reacting extremely positive to those the revamp mr. Caseza is planning to introduce in the company. One management layer will be eliminated, thus reducing bureaucracy. Mr. Caseza is aiming at accelerating decisionmaking as well in that huge industrial conglomerate. Siemens is actually right now. So now we have four big divisions after which well see nine subdivisions, less management, faster decisions and, of course, higher profitability. S Society General analysts are expecting that before 2016. All of that is viewed positively by the market site. In general, they are also announcing that they are ipoing their Hearing Aid Division and also theyre carving out their health care division, potentially also planning an ipo here. Ross with that, back to you. Annetta, thank you. Lets get to the other side of that deal. Stephan is with us. Heres the key question. If patrick decides hes going to sign a deal with ge, does he fear the french government will block it . Do they have the power to do that . Alstom has some activities in the Nuclear Sector that could be considered a strategic a potential veto from the french government, regarding the earnings released this morning, the situation was difficult, not critical. He explained at the press conference the net profit declined by 28 compared to last year. And thats the new level declined by 10 as the company is facing lower dealings from utilities. That is why theres increasing pressure on alstom. That being said, theres not pressure for the company to be sold. First of all, he asked him if he understood the french government decided to step in. Patrick coyne explained it was after all the job of the french government to protect employment in the country. And also about the froproject f General Electric. There is no improved offer from General Electric as was requested by the french president francois hollande. Separately, the french website reporting that siemens would decide not to make an offer for alstom because the board would be opposed to the plan. Thats a report from that website. Theres no way for the time being to confirm that piece of information. But for now, there is only one offer on the table, the one from General Electric. It will take alstom a month to look at this offer. Over to you. All right. Youve just spoken with patrick. Well be hopefully hearing more of that interview fairly shortly. Cant wait to hear what he has to say. Stephan, good stuff. Thank you. Thats coming up, the interview with patrick kron that was just finished. This is on the back of the release of a fiveyear plan that we got yesterday. Cnbc is in milan with more. Clara, very ambitious plans, Sergio Marchionne laid out. Why is there skepticism about it . Ak as y of course, as you were mentioning, it is a very ambitious plan. It is down by 8. 5 here this morning. And this is probably more than you might be expect. Of course, again, the ambitious plan is one of the reasons, remember, the stock has had quite a run. Up 40 in the last four months. 97 in the last year and has certainly outperformed its peers. As far as the ambition you were talking about, though, the numbers are great in terms of how much they expect to grow in terms of volume. They expect to reach significant numbers for jeep, 1 million already this year, going from the 732,000 in 2013. And then reach at the end of this fiveyear plan a 1. 9 Million Units sold for jeep. The same goes also for the ambitious plan of alfa romeo. Its so far failed to show that it can go through with a relaunch. This ambitious number also for alfa romeo, theyll be investing huge amounts of money there. So that seems to concern somehow the market on whether they can actually pull through on this. Theyre concentrating on these premium brands, continuing with masera maserati, ferrari, increasing the number of sales on the jeep as well as the alfa romeo. Premium brand is the key word that came out. Theres a concern on whether these can actually be numbers that can be reached per se. Also in terms of debt, Sergio Marchionne was optimistic saying we will reduce debt significantly by 2018 and the concern, i think, out from the market is, is this plan really and truly viable by that standpoint . So the economies have scaled they expect to reach are quite significant. They plan to bring these plants all to full production by 2018. Unions are happy about that. But the concern is this viable or not . Remember, also the First Quarter loss for the group was at 334 million. So thats also quite an increase from the First Quarter of 2013. So a lot of caution out there for fiat. Can Sergio Marchionne pull this plan off or not . Fiat is down by 18. 21 . Back to you. I guess well have to wait five years to find out whether he pulls it off or not. Its the first day in the next five years. Thanks for that. Catch you a little bit later. We turn our attention to thailand. More political chaos in the country after the countrys highest Court Ordered that the prime minister, shinawatra be removed from office. Shes been accused of abusing power. The court decreed that all current cabinet members who are serving with yingluck that year. No surprise to see the thai baht weaker. Theres no clear frontrunner in indonesia. We get the final tally from the parliamentary elections. The pdip lead with 19 of the vote, short of the 20 thats needed by a single party to put forth a president ial candidate. The worlds third biggest democracy will hold its president ial elections on july 9th. Staying with elections, this is a view from south africa. Will investors find treasure in alibabas ipo . More on what could be the biggest tech debut ever. man speaking chinese fame, makes a man take things over fame, lets him loose, hard to swallow fame, puts you there where things are hollow the evolution of luxury continues. The next generation 2015 escalade. Youre watching worldwide exchange. Japan can breathe a sigh of relief. It appears that Consumer Spending is still blunt despite a rise in the tax rate in april. Many thought that may be detrimental to the economy. We go to the nikkei with more from tokyo. Net profit exceeded market forecasts and it also surpassed ntt docomo for the first time which holds the largest number of subscribers in japan. Thanks to strong sales of smartphones an tablets, the company gained from increased communication charges. Also the firms investment in sprint is proving to be successful as the u. S. Companies earnings are improving faster than expected. Softbank sales doubled to nearly 66 million and operating profit reached a record high at 18 billion. Softbank is a major stakeholders of alibaba, the chinese ecommerce giant that announced plans to invest in the u. S. Stock market. They hold about 40 of the firms shares. The ceo says he has no intention of selling alibaba stocks at the time of the ipo. Thats all from the nikkei business report. Back to you, ross. Thank you for that. Chinese trade figures tomorrow and australian employment numbers. Watch the aussie dollar to react on the back of both of those numbers. On the earnings front we hear from national australias bank. And out of japan, expect results from toshida as well. It will be a busy thursday. Yes, after weeks of anticipation, the chinese ecommerce giant alibaba has finally filed for its ipo. It looks at a business that controls around 80 of chinas online commerce market. Eunice yoon has been taking a look at the buyers and sellers driving alibabas success. Reporter joe lee is a selfdescribed addict of chinas Online Shopping site tao bow. Hes purchasing furniture, his guitar and today, food for his cats. I can use it to access shopping anytime i want from laptop mobile. Reporter taobao is a National Obsession in china. Many logon and browse here. On taobao which means search for treasures, you can buy an outfit, try it on and hand it right back to the delivery man to have it returned. Millions of these packages are shipped out across the country. Its nothing impossible on taobao. So its easy to find some stuff, pretty hard to get from your local supermarket or local shoppers. Reporter todays lees cat food is coming from a warehouse across town in beijing. This retailer, one of taobaos 7 million used to have a proper pet food store but switched to sales online. We have more customers with our online shop. Theyre all over china, not just limited to beijing, he says. Its good for business. Lee got his cat food in less than a day. After paying through alipay, alibabas version of e bays paypal. The Payment System is one of chinas most trusted, though buyers and sellers say they hope alibaba builds faith even further by cracking down on the sale of fakes. Even so, lee is using taobao for all his needs, well, almost. Never buy on taobao, relationship. Reporter eunice yoon, cnbc, beijing. All right. Thats eunices report. Joining us on the line from hong kong, global imagining partner at ernest and young. Good to speak to you. Good morning. If institutions decide to invest in alibaba, is this the best way to play the ecommerce market in china . I think youre buying a whole portfolio of things, this is amazon, ebay, paypal, all rolled into one. So its probably one of best ways to be in the market. In terms of value, its really going to depend on the price as to whether this is financially the smartest way to be in the market but in terms of exposure to that segment, absolutely the best way to get in. It dominates its business. Does it have any significant competition in any of those areas . In the Online Shopping, theres a company liked j. D. , its a lot smaller. And thats going through the same market process as well. So you know, were talking something thats fifth or sixth of the scale of alibaba in the space. The potential for growth here in terms of i suppose consumption penetration rate in china. Absolutely huge. If you look at reports out there, people are saying that the markets going to grow a couple hundred percent over the coming three, four, five years. Actually my expectations is that it will grow quicker than that as people shift more and more to the Online Shopping model. Its hugely successful in china as you heard from your commentator. Do you think they will want to expand internationally . Do you think they have designs on that . Theyre actually already going outside the mainland hong kong you can get online. Theyre looking at many countries in Southeast Asia as well. I dont think its just a china phenomena. I think well see much more. Cominging from the backbone of china, historically being the factory of the world in the last decade or so, they have lots of people, willing sellers. Its a matter of finding willing buyers. The filing says 1 billion. Whats the charge theyll have i abigger ipo than facebook thats up at 16 billion . I think its hard to see exactly what the valuation will be. But it will be something of that magnitude. Keith pogson, joining us from e y on the phone from hong kong. Still to come on the show, this time last year, ben bernanke dropped the tapering bomb. Will there be any comments today when janet yellen speaks before the join the Economic Committee . Treasury yields are low, treasury prices higher. Stocks fairly cautious this morning. Take a look at the futures at this particular moment. You see we are currently below fair val yaw. Well get more coming up in a few moments. [paintball noises] the annual company retreat. Planned, as usual, by this guy. Nature lover. People person. And you put up with it all. Because he also booked you a room. At this place. Planet earths number one accomodation site booking. Com booking. Yeah [ female announcer ] theres a gap out there. Thats keeping you apart from the healthcare you deserve. But if healthcare changes. If it becomes simpler. The gap begins to close. When frustration and paperwork decrease. When doctors are better connected. When grandparents get to live at home instead of in a home. The gap closes even more. And you begin to live a healthier, happier life. So lets simplify things. Lets close the gap between people and care. This is worldwide exchange. Here are the headlines. Alibaba takes the First Step Towards what could be the worlds biggest tech ipo. The chinese ecommerce giant revealed its handling more transactions than amazon and ebay combined. Hsbcs pretax profit falls 20 for the First Quarter. The bank sees continue muted customer activity. Alstom could be interested in a deal with ge. A media report suggests siemens is going to pull out. Investors turn an eye to washington today. Fed chair janet yellen set to testify on capitol hill on the u. S. Economy and monetary policy. Plenty to come on todays program. We continue to focus on theion going battle for ge. Frances alstom wrapped up a press conference in paris after reporting quarterly numbers. The firms ceo has opened the deal to some possible deal with ge. Kron reiterated he would give rival siemens fair access to its books so it can decide on whether to make a counteroffer. Stephan has been speaking exclusively to the alstom ceo and he jones us njoins us now. Im particularly interested in what he had to say about the prospect of the french government blocking any deal. Yes, thats one of the questions, of course, that weve heard this morning at a press conference here at alstom headquarters. The press conference was focused on the earnings of the company, down 28 on the full year. Of course, most of the questions, if not all, were focused on General Electric and siemens, both reportedly interested by the Energy Activity of alstom. Ge has made an offer. Siemens is still working on it. I caught up with the ceo of alstom, patrick kron and asked him if it was the right thing for the french government to step in these negotiations. I think that the french government is obviously one of the stakeholders, and its absolutely legitimate to express views in the situation. Im not surprised, nor consider illegitimate such intervention. I understood the french president expressed the priority of putting this issue on employment. This is exactly my concern and my priority as well. What i want to do is give a future to Alstom Energy activities and its employees. The economy minister believes that it would make more sense to create a european champion rather than being sold to an american company. We have today one offer on the table. This is the offer, the binding offer provided by General Electric. The agreement with General Electric allows alstom to consider any unsolicited offer which would be deemed as potentially being superior. So this is the start of the process. If there are better offers, we will consider. And are you worried that the government could block the deal for strategic reasons . I think the strategy challenges of Alstom Energy businesses are on the table. There is an issue about the critical side in order to address the financial needs of the customer, the worldwide reach you need to have in order to address while the job market is open. The issue is of critical size. I think you need to find solutions which meets this Strategic Issues and i think the offer received from General Electric is addressing these issues. If there are better ones, well see. One last question. Are you working on an improved offer from General Electric . I have the offer which is on the table. The board is studying it. It has established a committee of independent directors. Again, if there are new elements in these proposals, should it be an alternative offer or precisions or improvements of existing ones, we will consider both. Patrick kron, the ceo of alstom didnt really answermy question, to be honest, on the possible veto from the french government. Its still an option for two reasons. Alstom is working on the Nuclear Power plan in the france. Its providing for the power plan, therefore, it could be considered as a strategic activity. The second reason is that the french government is still a shareholder of alstom, a very small part of the company, less than 1 , through the public bank. Therefore, also would have its word to say although its not the main shareholder of the company. Ross, over to you. Good stuff, stephan. Thats the latest from the alstom ceo. Meanwhile, head of the u. S. Trading session today, futures indicating we might get a tick higher at the open at the moment. Were currently 36 points above fair value after dipping down 129 points, 0. 8 . The s p had its worst day in nearly a month. Were currently some 3 points above fair value. The nasdaq down 1. 4 , dragged down by twitter. Twitter stock off nearly 18 during the session. Here we go. You can see where we stand at the moment. That dragging the nasdaq down 1. 4 . This morning its called fairly flat. Another difficult day as well for the russell 2000. Small cap stocks, yelp, Athena Health also losing a big chunk of market capital. Ill talk about twitter as well. Thats after the lockup period e ended. Facebook shares down today as well. European equity markets meanwhile, here we are, just over two hours into the trading session, are low. Aliba sbc shares trying to come off the lows. Xetra dax is flat, the cac current down 0. 1, the ftse mib is down lower, dragged low by fiat. There was a presentation by Sergio Marchionne to boost chrysler and the alfa romeo brands. Some say its too ambitious. On bond markets, tenyear treasury yields, ahead of janet yellen beginning two days of testimony to congress today. Friday we had a yield of 2. 7 . On the currency market, the dollar has been struggling over the last couple of days. We hit 1. 3952. We low it at the moment, 1. 3930. Dollar yen is down on a threeweek low, around 101. 50. Sterling, near 1. 70. Currently below that at 1. 6969. Thats where we stand on the currency markets. Yep, its finally happens as well. Chinese ecommerce giant alibaba filing for an ipo after weeks of anticipation. The business controls around 80 of chinas online commerce market. Eunice has been focusing on this. Shes as revealed as anybody. Weeks of preparation for you, eunice, going through the numbers. The key thing is here, we have 2,300 pages in this filing. But theres plenty of things we dont yet know. We done the even know which exchange theyre going to list on. No, we dont. We dont know which exchange theyre going to list on. We dont know the ticker symbol. We dont know the price. We dont know the number of shares that are going to be sold. Thats one of the reasons why there are people who are quite disappointed that we dont have more detail. They want to figure out what the valuation of this company and this stock is going to be. A lot of that is going to then help investors make decisions as to whether or not they want to take the risk. Theres a lot of good stuff here when it comes to alibaba. It is an ecommerce behemoth, especially, of course, in china. They announced some of their numbers, which was at 248 bhl wor billion worth of goods that move across the site. At the same time, there are a lot of questions about Corporate Governance as well as regulatory risks, in terms of Corporate Governance, people have been saying theyve been disappointed with the idea that investors wouldnt be able to get more say on the board, that the way that its structured right now really indicates that the founders of this company is going to have complete control over decisions. Its not going to be a very transparent. That is the feeling among a lot of investors. The other point that people have been discussing is all of the regulatory risks in that prospectus instead of detail. A lot of risks highlighted in the prospectus about what the framework is here in china. And what that might mean for the future of its businesses here. Not only not really so much on the Online Shopping site but actually more on the banking site and the payment site for alibaba which is also very, very successful. Yes. Its going to be a big deal. We cant wait to get more details. For now, eunice, thank you very much indeed. Plenty more on cnbc. Com. To find out just how much alibaba could be worth and why one Analyst Thinks it will become the most valuable company in the world. As a result, would you buy alibaba shares . Head to our online poll. Have your say, all on cnbc. Com. More on that, also still to come, the governing African National congress is tipped to win the South African general election. We get the latest from pretoria, after the break. Chocolate is very individual. White chocolate lovers dont like dark chocolate. Milk chocolate lovers dont necessarily like dark or white. Before we couldnt really allow the consumer to customize their preferred chocolate. We needed the scalable Cloud Solution allowing them to see all 800 products and select what they are looking for. Now there is endless opportunity to indulge. Youre watching worldwide exchange. The headlines today, alibaba files for its ipo. No word on where the ecommerce giant will actually list. Alstoms ceo tells cnbc if there are better offers than ges, it would consider them. And hsbcs profit down 20 as activity slows at europes biggest bank. Fed chair janet yellen meanwhile is back on capitol hill today testifying before the joint Economic Committee at 10 00 a. M. Eastern. Fed watchers are keen to know whether shes toughened her stance on whether theres a substantial slack in the u. S. Labor market given the drop in unemployment and the Labor Participation rate in april. Joining us with his views, global head of fx strategy. Thanks for joining us. Hes likely to be asked on the specific timing of when we might get any Interest Rate rises. I presume shell dodge all those questions. Her stance so far has been that theres more downside than upside risk to inflation. And thats an important part of the reason why Interest Rates have not really reacted much to better u. S. Growth data in the last couple of weeks. I dont think shes going to change the stance in that. That is the key thing to watch in this speech and future speeches. Shes not that concerned by the stagnation either in growth in q1. Compared to expectations, is she going to be towing the middle line or be a bit more dovish . Whats your thought . She has been quite dovish over the last few speeches that shes been delivering. Obviously the Economic Data has been better. It was not only the labor Market Report on friday. Its also retail sales that has been cycling Something Better into the Second Quarter. I think shell have to say that. The markets should be expecting that. I think its a little bit too early to expect something really new from yellen. I think we need to see confirmation, that growth is heading towards 3 before the fed is willing to send more clear signals as to monetary policy. How does this all get reflected in asset prices . Yes, so i would say over the last couple of weeks, really, weve had the dollar trading on its back foot. Even in the face of these stronger u. S. Data, weve not really seen Much Movement in u. S. Rates or the dollar. In this very, very low volatility environment, that could persist as long as the fed is not willing to commit to a stronger forwardlooking signal. Thats reflected in terms of light, for example, trades doing incredibly well for some time now. Low volatility is equivalent to those trades doing well. We could see more of that before the fed is willing to commit to a change. We continue to see, you know, longer dated treasury yields drift lower, 30 years down near 10month low, tenyear down threemonth lows. Yes. Seems to be no pressure there at all. Yes. So this is what is very, very unusual about this cycle that we are getting closer and closer to the Takeoff Point. But nevertheless, investors are so confident that even if the fed is going to tighten fairly soon, they will tighten so slowly that they dont have to worry about the longer end and having higher Interest Rates. This is what is unusual about this tightening. Its expected to be a removal of easing rather than the fed going longer. That keeps it anchored. Rates will need to rise more quickly than the fed or investors seem to be expecting next year. Is that the risk . I would say the risk is more that the Takeoff Point could be earlier. I think once the takeoff comes, theyll be very careful not to go too quickly. But were at zero rates. If we have an Unemployment Rate that tunes to drop and could have a five handle in the foreseeable future, perhaps they want to have the Takeoff Point come earlier. Maybe this speech is too early. Within the next three, four months, perhaps the fed is so confident, they are willing to signal that the Takeoff Point could be earlier. Get a cup of coffee. Well come back to you shortly. Thank you. On the agenda today, besides janet yellen, First Quarter productivity rates. Labor costs are expected to rise 2. 8 . At 3 00 p. M. , march Consumer Credit and of course the fed chair janet yellen testifying before the about the economy before the joint Economic Committee. That begins at 10 00 eastern. Mondelez allergan, king, molson coors, hertz, aol, sothebys, report before the open. After the open, 21st century fox, green mountain, tesla, Caesars Entertainment and zillow. Busy day. We hear from the creator of the worlds iphone hearing aid, thats after the break. Now, according to the National Institute on deafness, some 36 Million People suffer from some form of hearing loss. Only one in five who need a hearing aid actually have one. Gn resound has attempted to close that gap with the worlds first made for iphone hearing aid. The ceo of gn resound is with us. Thanks indeed for joining us. Are you hoping out of the one in five people who need a hearing aid that actually have one, this is going to change things. You could use this for all sorts of things. Its a communications tool, right . Thats correct. I think its important when you talk about this product, its three parts. First of all, its very important hearing aid. Yes. Its actually the smartest hearing aid in the world. Its the best sound quality that money can buy. Next to it, its actually thats important for the hearing impaired, because thats what we need to fix for them. Beyond that, theres a fancy part and that is obviously the connectivity with the iphone. What it means is that you can stream sound directly from a hearing aid to an iphone in high quality stereo sound without an intermediary device hanging around your neck. Its all done remotely, wirelessly . Absolutely. Its based on bluetooth smart, bluetooth technology. The third part of this package is actually the smart app. Which helps the user to kind of make the hearing aid personally fit to themself and their preference. Just turn your head to the side. The other side. We take the other shot. There it is. Take it out. Its tiny. Interesting about this is, you can phone calls, facetime chats, music, movies, navigation, they can all be streamed to this ear piece. Correct. And if youre at a noisy event you can tune that out and make it singular to the thing you want to hear. Thats correct. I know youve made it for hearing aid loss. This could broaden into a more mainstream product, could it . I think the issue it may have the potential to destigmatize the hearing aid itself, the hearing impaired and the use of hearing aids, because remember, we are making products for people that really need it but nobody wants to wear it, because the time you put it on, the perception is that you get ten years older and thats not nice. Okay. The producer is complaining i need a hearing aid because im not listening to him. Thank you, ceo of gn resound. Japans main share market recorded its biggest daily drop in nearly two months. Nikkei down. There are concerns about ukraine curving appetite for risk. Lets go to new york and jens norvick. The yen, still, though, cant seem to get any momentum lower on its own. Yes. Well, so, i think its very important to think about which expectations were in place and heading into this quarter, there were a lot of people that expected the bank of japan to ease further. We obviously have not seen it at the first two meetings of the quarter during the month of april. We probably will not see it in may or june either. So i think it is those expectations coming out of the market, its making it hard for the yen to continue this weakening trend. Obviously in the context of dollar yen, theres been a global dollar over the past couple days that generated pressure. Looking further ahead, we still think the longterm trend of yen weakness is in play. It has to do with Inflation Expectations rising and real Interest Rates going down in japan. Thats still the trend were seeing on an underlying basis. What sort of inflation are we talking about . Theres good and bad. In japan, theres many different types of inflation. Theres that coming from the consumption tax hike. Theres that coming from the Exchange Rate being weaker. We have seen the first signs of wage growth in japan for many, many years. If we see that trend continue and broaden from Big Companies to small companies, i think that would be a sign this this deflationary psychology thats been present for more than a decade is potentially broken. That will be the type of inflation that the bank of japan would like to see in the longer run. I think most signs actually point in direction of that happening. Good to see you, global head of fixed Income Research at nomu nomura. Still to come, disneys frozen has pulled in a cool 1. 2 billion in sales. That means earnings have gone. Well have analysis of the results after the break. Also, well take a look at how futures are trading as well. We are slightly higher at the open today. Youre watching worldwide exchange. Im ross westgate, the headlines, alstom ceos tells cnbc exclusively that ge has not made an improved offer yet and that the french governments views on a potential takeover are absolutely legitimate. Alibaba takes the First Step Towards what could be the worlds biggest tech ipo. The chinese ecommerce giant files for u. S. Listing and reveals its already handling more transactions than amazon and ebay combined. Hsbc profits down 20 in the First Quarter. Weakness in Investment Banking way. The lender saying its seeing muted customer activity. Investors keep a big eye on washington today. Fed chair janet yellen begins two days of hearings on capitol hill on the u. S. Economy and monetary policy. Youre watching worldwide exchange, bringing you Business News from around the globe. A very good morning to you. If youve just joined us state side, welcome to your Global Trading day here. U. S. Equities down, the dow down 129 points, the s p having its worst day in nearly a month. This morning, above fair value at 27 points. The s p 3 points above fair value and the nasdaq, 3 points below fair value. Small cap stocks like yelp and Athena Health losing a bit of market cap. Facebook shares and other social media stocks also lower. Facebook down 4. 3 . But lots of excitement over disneys report card as the movie frozen pushed them to new highs. Morgan brennan has more. Reporter the big beat in the Magic Kingdom as disneys adjusted earnings of 1. 11 trumped expectations to become the highest Quarterly Earnings per share in the history of the km. Revenue topped expectations at 11. 65 billion. Now, mega blockbuster frozen has been getting all of the attention when it comes to disney and with nearly 1. 2 billion gross, certainly the main driver of growth in the companys studio division. But all five of disneys businesses, media networks, parks and resorts, studio, Consumer Products and interactive, all grew strongly in the fiscal Second Quarter. Each posting double digit increases in operating income, even the companys smallest unit, interactive has logged three profitable quarters in a row. Thats the first time for that division. On the earnings call, ceo bob iger covering a lot of ground saying that the marvel brand is just Getting Started and he expects frozen to become a top five franchise for the company. Also commenting on the pentup demand for next year star wars movie, the first of four in the works. Iger noted that disney is acquiring maker studios mainly for its distribution. He hopes to see an over the top from dish network. As a result of the two companys landmark agreement. Shares of disney stock moving higher on the report in afterhours trading. Back to you. Thats the report from morgan. Joining us, our guest. What are your views on the stock right now after this report card . There was a lot to like about those results. The Company Reported highest Quarterly Earnings in its history. We reaffirmed our buy recommendation on this share. We see the shares pushing further into alltime high territory. Clearly as you indicated, the studio was the main highlight for the quarter. As you look down the other businesses, every single one of the underlying businesses we think had very strong and compelling positive takeaways. So thats why i think bob iger and his Management Team have done an outstanding job to continue to, you know, keep the momentum going. Now, clearly frozen has been much better than anybody expected. My daughters love singing the songs, let it go in particular. Thats a key thing. You cant legislate whether you get big hits or misses in films. If you strip that out, youre comfortable enough with the rest of the underlying business . Absolutely. Heres why. You know, their worldwide theme parks continue to outperform expectations, both in florida and disneyland, you know, hong kong parks. They set new attendance records. If you look at the media networks, espn and abc, disney channel, all of those continued to have very strong underlying indicators there, advertising affiliate revenues and then you add Consumer Products, which has really been an area where investors havent really focused on, up until the acquisition of marvel. Now you see disney animation with frozen driving the results of merchandise licensing across the globe. So we think that, you know, never before in all of the years that weve covered disney, would think the stars are properly aligned for them to continue to drive double digit eps growth into the foreseeable future. Its interesting. The earnings at the tv operations up by 15 despite lower ratings at abc. That was fairly good on the back of that. Where are the risks here . It looks like, as you say, all the stars are aligned at the moment. They never stay aligned for long, though. What could be the risk for you . The main risk factor thats a very good question by the way disney is always vulnerable to cyclical media pullback to lead out of the recession and also tends to lag going into a recession. We think that youll want to be, you know, in the story just as the economy is recovering. And any sense that the economy might be pulling back the theme parks get weaker, advertising revenues get soft. I think whats remarkably, theyve been able to diversify their revenue streams. Now you see this infinity console gaming. Theyve tried to broaden their base, star wars film, star wars 7 is coming out next year. They have sequels to all of the, you know, Marvel Avengers films, whether its captain america and all of those spinoff characters. We think the story has become even much more, you know, compelling today than the disney that we were covering, maybe five years ago. Good to see you this morning. Joining us from s p capital iq. That was also game on for Electronic Arts and activision blizzard. Both gamemakers reported betterthanexpected earnings. Cnbcs josh lipton has more on the gaming numbers from silicon valley. Reporter Electronic Arts and activision both reporting and besting expectations. As for ea, the street expected to see eps of 11 cents on 812 million. Ea reported 48 cents on 914 million. Healthy beat on the bottom and the top. As for fullyear guidance, analysts forecast 1. 52 on 4. 11 billion. Ea guides for 1. 85 on revenue of 4. 1 billion. Ea saying that so far this year, fifa 14, titan fall, exclusive game for microsoft systems and battlefield 4 are three of the top five best selling titles on all platforms across the world. Activision, beat the forecast easily, reporting 19 cents on 772 million. Guidance, however, a bill light relative to the streets expectations. The company saying it expects its upcoming game, destiny, to be its next 1 billion franchise. Thats call of duty franchise will be coming to china in partnership with 10 cent. Josh lipton, cnbc, silicon valley. Thats the latest on the gamers. Costs weighing, this is the maker of budweiser, theyve upped its marketing spend ahead of the world cup in brazil this summer. Despite revenues jumping, the firm sold more beer in every region, apart from europe. Numbers particularly strong in china and brazil. First quarter profit at hsbc dropped by 20 . Revenue down at its Investment Bank unit. Hsbc, which is europes biggest bank, said it continued to experience muted customer activity in the month of april. It did cut operating costs by 2 in the quarter as it continues to look at jobs and close businesses. Bank of america holds its annual meeting today in charlotte, north carolina. The Ceo Brian Moynihan expects to face pretty tough questions a week after the company disclosed a 4 billion accounting error that forced it to scrap its dividend buyback plans. Two big u. S. Pension funds, calpers and calstras plan to vote against the order pwc and the Audit Committee to protest the mishap. Another big mishap. Still to come, will teslas luxury electronics be on the fast lane to asian success . Well discuss this as the carmaker prepares to release its results after the close today. Having the cloud allows us to rapid prototype a lot of ideas. Being able to pay as we go is crucial for a start up. Having to fork out a lot of money up front was risky. We can launch a feature really quick, and if the feature doesnt work, we havent lost anything, and we can have something up and running in days. And this would not be possible without the cloud. We are now supporting over 25 million users each month. Youre watching worldwide exchange. Recap of the headlines, alibaba files for an ipo. No word on where the ecommerce giant will actually list. Alstoms ceo tells cnbc if there are better offers to ges, it will consider them. And hsbcs profit takes a 20 brunt as activity slows at the bank. Frances alstom just wrapped up a press conference in paris after reporting quarterly numbers. The firms ceo has said hes interested in the rail activity. Patrick kron said the business was too niched. He said he would give siemens fair access to its books so it can decide whether to make an offer. Stephan has been speaking to patrick kron and joins us for more. Interesting comments about where we stand in the bid process. Yes, that is not improved offer from General Electric at this stage. Its basically what patrick kron told me, the situation is difficult but not critical, although the Company Posted a 28 decline on fullyear net profit. Its what patrick kron explained this morning in the press conference. Still he believes that a deal to sell the Energy Activity would be the best solution to ensure the future of this activity in the context of tough competition. Patrick kron also told me that the french government was doing its job when it decided to step in to ensure that a deal would not jeopardize employment in france, regarding the deal, the potential deal with ge, francois hollande, the french president , requested an improved offer earlier this week. At this stage, theres no alternative offer on the table. I have the offer which is on the table. The board is studying it. It has established a committee of independent directors, again, if there are new elements in these proposals, should it be an alternative offer or precisions or improvements of existing ones, the board will consider. On that theory, the french government could still block a potential deal with General Electric because of strategic reasons. Alstom is producing turbines for the Nuclear Power plants in france. It has less than 1 of alstom through the public banks, cdc. It has its work to say as a stakeholders of the company. Over to you, ross. All right. They keep getting more news out but no finalizations. For now, stephan, thank you. Before we go to break, take a look at this. New yorks spring art auction season got off to a good but not a great start. Christies sold 286 million of impressionist art. This, the headliner. Brett clark bought it in 1930 and had it in a sitting room. The piece sold for 24 million. 27 million including the fees. That was below estimates of 25 million without the fees. Still, its a chunk of change. Will investors find a treasure in alibabas ipo . More on what could be the biggest tech debut ever. Tigers, both of you. Tigers . Dont be modest. I see how youve been investing. Setting long term goals. Diversifying. Dip you got our attention. We did . Of course. Youre type e well, i have been researching retirement strategies. Well thats what type e s do. Welcome home. Taking control of your retirement . E trade gives you the tools and resources to get it right. Are you type e . [ female announcer ] theres a gap out there. Thats keeping you apart from the healthcare you deserve. But if healthcare changes. If it becomes simpler. The gap begins to close. When frustration and paperwork decrease. When doctors are better connected. When grandparents get to live at home instead of in a home. The gap closes even more. And you begin to live a healthier, happier life. So lets simplify things. Lets close the gap between people and care. Woman welcome to learning. Spanish in the car. C on. Between people and care. Passenger youve got to be kidding me. Driver this is good. Woman vamanos. Driver passenger vamanos. Woman gracias. Driver passenger gracias. Passenger trece horas en el carro sin parar y no traes musica. Driver mira entra y comprame unas papitas. Vo get up to 795 miles per tank in the tdi clean diesel. The volkswagen passat. Recipient of the j. D. Power appeal award, two years in a row. A reminder on whats on the agen agenda in the united states, labor costs expected to rise 2. 8 . At 3 00 p. M. , we get march Consumer Credit. Fed chair janet yellen testifies about the economy before the joint Economic Committee thats at 10 00 a. M. Eastern. On the earnings front, mondelez, allergan, king digital, molson coors, hertz, aol, sothebys all report numbers from the open. After the close, well hear from 21 cst century fox, green mountain, tesla, Caesars Entertainment and zillow. U. S. Futures ahead of yellens testimony suggest we might move modestly higher at the open at the moment. Not by much. The dow is currently some 22 points above fair value, the s p 500 is 2 points above fair value the nasdaq is below fair value, down 1. 4 , pulled lower by twitter which was off 17. 8 . Yes, its finally happened. Alibaba has filed for an ipo after weeks of anticipation. The Filing Office looked at a business that controls around 80 of chinas online commerce market. Jane wells filed this report. Lucky, just lucky. Reporter jack ma may be lucky but hes relentless. He launched alibaba, no one would open sesame to help him. I was rejected by so many venture capitalists when i talk about alibaba, they look at me strange, alibaba, what are you talking about . I went back to china with nothing, no money, nobody invested in me. But i was full of confidence. I saw the american dreams. Reporter the dream of hard work paying off. It did. Alibaba has grown into chinas largest ecommerce platform, beyond b2b, retail, online payments and more. Making this 49yearold former teacher who taught himself english worth nearly 9 billion. Today we have lots of money. Were still very careful for every penny we spend. Reporter ma is a different type of chinese businessman. Hes funny. Here he is at stanford in 2011. Are you going to buy yahoo . Good question. Yes, we are interested in that. Reporter he has a knack for analogies. This talk is just like like a peace talk on the united nations, very complicated. I call myself like a blind man riding on the back of blind tigers. Reporter he insists on telling everyone about failure. Like most companies we made hundreds of thousands of mistakes. We made so many mistakes. We were so stupid at times. Reporter jack ma believes you dont learn from other peoples successes but from the stupid things they do. As the company he founded prepares to go public, ma says his business philosophy is customers first, employees second, shareholders third. And he remains a dreamer who has defied critics inside and outside china. We find the best managers in finance, technology and marketing. Put them together, but my idea my job is every day tell them the dream. Reporter for cnbc Business News, im jane wells. Joining us on the line from california is francis gaskin, Research Director at equities. Com. Francis, certain things we dont know about the ipo. We dont know where theyre going to list or the price. What do you think when we fill in the blanks what the answers will be . Well, theyre looking at nasdaq or the new york stock exchange. Theyre making a big deal about it from an investor standpoint, i dont think it makes any difference. Okay. What do you think the filing says were going to go for 1 billion listing. How much bigger do you think it might be . Well, they may want to go bigger than facebook. They could easily go above 16 billion. I think just for ego sake. Now the issue is what are their earnings worth and whats the price and valuation . The kind of discussion theyll be having with institutions and theyre probably having right now, is what is it worth . If you look at the sales for the 12 months ending december 2013, because they havent filed their march quarter, which is expected to be down quite a bit because its in the Lunar New Year for china and most Consumer Companies are down, the revenue is 8. 4 billion and they earned 3. 5 billion. I think if you take 50 times multiple which it may deserve because it has a 44 aftertax profit margin, which is huge. Thats a plus and its a minus. Its a minus because its going to attract a lot of competition. Its a plus because when they have top line revenue growth, it drops down to the bottom line. But if you i think theyre going to start with a valuation, Something Like 50 times that which will be 170 billion plus. The question is, how much pushback will they get from Institutional Investors at that price . And what the institutions will say is, its a sector play. Its a sector play for consumer ecommerce in china. Its a pure play right now. The only thing is, the China Economy is slowing down a little bit. So they may be a little bit of conservative in the projection, believability on the institution side. But on the one hand, the economy may be slowing down. Presumably, the sort of consumption penetration rate is china will only go one way and thats up. Right. The China Consumption penetration is 55 of the united states. They have a lower income per capita, no doubt about it. Right. From a 30,000foot view point, thats the deal. The consumption penetration rate is low in china. Is it due to go up . If you want to play it, how do you play it . Alibaba is a great way to play it. It dominates this market. Its got a great footprint. It has great aftertax margins. Thats a simple decision. Just the question of whats the multiple of the earnings. Francis, whats the time line now . How long before you think we get pricing and when we actually get to the float . Typically when companies file, its three or four weeks before they set the price range. And then once they set the price range its 10 to 12 days after that they go public. I would say the target date for the ipo would be midtolate june. Francis, good to see you. Thanks for joining us this morning. Francis gaskins. Director of research, equities. Com. Phone out more about the alibaba ipo at cnbc. Com. Phone out why one Analyst Thinks it will be the most valuable company in the world. Weve been asking would you buy alibaba shares . Head to our poll on cnbc. Com. Otherwise, thats it for todays edition of worldwide exchange. Squawk box coming up next and the countdown to the opening markets state side. Have a profitable day. More than your wife. More than your kids. More than your own mother. But does the game. Love you . Who cares . You get to stay at this golf resort booking. Com booking. Yeah good morning. Welcome to squawk box. Chinese ecommerce giant alibaba file for what could be one of the biggest ipos ever. Global markets getting rattled by ukraine. And janet yellen talks today. And disneys quarter powered by frozen. And the sorkin family who has been paying a lot for frozen these days. Let it go let it go cant hold it back any more let it go good morning, everybody, welcome to squawk box here on cnbc. Im becky quick along with Andrew Ross Sorkin and brian sullivan. Joe is out today. Our top story this morning, chinese ecommerce giant alibaba filing for an initial Public Offering in what could be one of the largest debuts in history. Alibaba Holding Group which controls 80 of all online commerce in china could raise as much as 16 billion. That would top facebooks ipo back in 2012. The biggest winner in the ipo will be yahoo . Yahoo bought a 40 stake in alibaba in 2005 for 1 billion. It currently holds a 22. 6 stake. Some are value be alibaba overall market capitalization as high as 150 billion. Here are some of the eyepopping statistics that come with this company. 231 million annual active buyers. 8 million annual active sellers. 49 average orders per active buyer. 11. 3 billion annual orders. 5 billion packages generated on china retail marketplaces, 3. 6 million transactions a minute processing pa