Transcripts For CNBC Worldwide Exchange 20140721

Here. The umt n. Calls for a ceasefire in gaza since the deadliest day since the conflict started. The death toll from the conflict now topping 500. Changes at the top for tesco. The ceo Phillip Clark will step down in october to be replaced by a relatively unknown dave lewis. Investors say this is sending shares higher. And shares tumble in dubai because of uncertainty about its largest builder. Aerotech. Youre watching Worldwide Exchange. Bringing you reports from around the world. The fighting is underway near the east ukrainian station. Operations in Eastern Ukraine are in an active phase but didnt comment specifically on the troops entering donetsk. They are expected to hold a press conference shortly and well get that to you as that begins. Russia is feeling pressure after shooting down malaysian flights 17. European leaders have threatened to level new sanctions against moscow as early as this tuesday. Unless an accident investigator is allowed to the crash site. This comes amid mounting anger over the treatment of bodies with prorussian separatists accused of mishandling the remains of those who died on the plane. Speaking on nbcs meet the press, john kerry said the disaster should prompt a stronger european stance against moscow. Weve taken tough sanctions, we hope this is a profound wakeup call to those countries in europe that have wanted to kind of, you know, go slow and soft pedal this. Joining us in the studio is the acting Ukrainian Ambassador to the u. K. Ambassador, thank you for joining us this morning. Can i ask if you are stepping up operations right now in Eastern Ukraine . Ukrainian armed forces are quite successful right now in the duration of the territory temporary occupied by the prorussian terrorists. Lets call the right terms. But what is more important, we do see the growing International Understanding and growing International Support of the ukrainian position. Mr. Kerry told this is a wakeup call. Yes, indeed. A few days ago we entered the civilization conflict. It is not now ukrainian business or ukrainian versus russia cop fli conflict, this is something that has the International World meaning. You said that you want to see a step up to phase three sanctions from europe. Do you think were capable of coming to an agreement on this in the next few days . I think so. They wakeup call was heard. And this is the most important. As far as i know, they reached the growing consensus about the sanctions and next tuesday brussels will show us what will happen with that. And the sanctions are very crucial just to stop the aggression. The ukrainians will be quite successful in liberation and in fight with terror if the russians will not supply any more with the money, with Trained Personnel and go there just to fight. You have made the comment in the last 24 hours russia is still supplying weapons to the rebels. Is that what you believe . Yes, we have all the evidence of the continuous supply of the russian terrorists in ukraine from the territory of russian configuration. Moreover, we have witnessed the cases of heavy or tillty motor and rocket shelling against ukrainian troops from the russian territories. This is unnecessary aggression. What could force him to cut ties here . I think a united position of the World Community will bring understanding of terror not being permitted in the 21st century. The suggestion from russia is they will allow unprecedented access to the crash site. I wonder if an International Investigation has passed given what has happened at the crash site. Has the time for the investigation passed and is the forensic investigation compromised here . I would say that we are witnesses of the crime. The first one was an act of terror against the airliner. The second one, this is abuse against the dead bodies of the victims. And the debris of the liner and integrity of the crash site. Ukraine is ready to ensure transparent in the absolute investigation of the situation. We have requested the international asis the answer and International Specialties to come. And they are right in ukraine. We have launched special program for the logistic of that investigation. The special crisis was established and this is ukraine who has the responsibility to make this investigation, not selfproclaimed, this terrorist organization, socalled peoples republic, which are definitely of the terroristic nature. Does the rebellion in the east need to be entirely crushed before we can bring russia, ukraine, to the negotiating table here . For us it is that they have given up their weapons. And this is a condition for the compromise with the prorussian terrorists. And we are doing our best to force them to give up their weapons. Yesterday, for example, 23 russian nationals were taken by the Ukrainian Military while they were trying two escape from one of the ukrainian cities. They are russian nationals and are reportedly, some of them at least, are members of the armed forces of russia. But you agree the rebels wont give up the weapons unless they are forced. It wont happen voluntarily, they have to be forced to give them up. Well, the price is life, and they probably have to force for giving up the weapons, otherwise i have all the doubts that they will go to constructive steps towards ukrainian request. Sir, thank you for speaking to us this morning. Andre, the acting ambassador to the u. K. You are looking at live pictures of kiev. Well bring you right to that as soon as it begins. The u. N. Security Council Resolution to allow access to the area, Vladimir Putin called for full security at the site of the crash. Hes promised to do Everything Possible to end the fighting in ukraine. Translator we must do everything to guarantee the International Civil aviations total full safety and secure the humanitarian corridors for it to work. From the site of russia, we are doing everything that depends on us so the conflict in Eastern Ukraine moves through the military phase to the phase of talks at the negotiating table where only peaceful and diplomatic means will be used. Putins comments follow a decision by russia to expand the list of americans banned from the country in apparent retaliation for washingtons ramped up sanctions. Nbcs jim maceda is in moscow. Jim, that didnt sound like Vladimir Putin is cowered by the events of the last 24 hours, but as we heard from the kt aing ambassador there, how do you believe the internationalization of this crisis is impacting putin . Reporter well, you know, julia, theres been a lot of talk from the pundits over the past 24 to 48 hours about a game changer, about how the crash of Malaysia Airlines flight 17 could, in fact, change the environment and the landscape completely. But we have seen that so far. The game in ukraine has not changed at all. The war as the ambassador suggested and said quite vividly, i call it by the way a civil war because it is primarily between two Armed Ukrainian groups. Prokiev and promoscow. That war is raging on and nowen confirmed reuters reports from the prorussian leader that fighting is going on inside donetsk with tanks heading into the city center. So we are seeing putin paying lip services that just suggested, that quote you had from him, saying how the site has to be unfettered and there has to be a maximum amount of freedom there for everyone to do their jobs, but at the same time there is there are no signs of concern it seems on his part about the growing International Indictment against him or becoming a pariah nation. Hes still blaming everything indirectly on ukraine and seems certainly confidently that europe will have no stomach to push through the sanctions. Yijim, we are now hearing fr the Prime Minister of ukraine. Jim, well come back to you. Heres what the Prime Minister is saying. You wanted to be able to take away the bodies of the dead people. And the russian territories do not allow us to evacuate all the bodies and to abandon the station in order to bring them to the designated place. In general, 810 workers take part in the operation. 355 of them are workers of the states emergency service. The Security Service of ukraine launched a criminal case and created a group, a task force, that enrolls all the Law Enforcement bodies of ukraine and our foreign partners arrived today to take part in the investigation of this terrible tragedy. As far as our position on the investigation is concerned, it is unchanged. Transparticipant and fullfledged International Investigation. Ukraine is ready to transfer the coordinated role on the investigation of this terrible tragedy to our western partners. The netherlands can have this process in clear coordination with the ukraine yap structures and entire International Community. As for the autopsy and forensic investigation of all the people who died in amsterdam, there is one of the most developed in the world. The Ukrainian Government is ready to transport all the bodies to amsterdam in order to conduct the needed expertise for the forensic investigation. The russian government has done nothing in order to provide an opportunity for Law Enforcement and service on the emergency situation and International Community to have unhindered access. And thats why because of all the possibilities, including unofficial negotiations, we were able to collect the bodies and collect part of the proof of this terrible traffic did. At the current stage, we do not have any doubt that this plane was shot down. The reason of the full order plane is the missile strike. And it is absolutely understandable that to manage this system a drunken prorussian terrorist cannot do that. Those were expert people who are trained and we have information that this training took place on russian territory who received russian financing and arms and training. And this is why this terrible international tragedy, this International Crime against humanity has to be investigated by the International Commission. And i emphasize once more we are ready for the netherlands to take up the management of the investigation and coordination as a country that suffered most in all of the international communities. But once again, my deepest condolences. My deepest condolences to those families who lost their beloved. We pray for everyone. We pray for these families and the ukrainian nation mourns. Let me update on the latest developments. Ukrainian authorities discovered 272 bodies. 251 of which are already loaded in the train refrigerators. We sent two trains, four cars of which right now are located in torrez city. These bloody guerillas do not allow the train to leave the area. We expect that the train will leave the area as soon as possible. Ukrainian government is ready to transfer an International Investigation to our dutch frien friends. Dutch side could lead the process of investigation together with the entire International Community and ukrainian authorities. We are ready to transfer all bodies directly to amsterdam as one of the best territories located in amsterdam. Ukrainian Security Agency already thought that a comprehensive and thorough investigation of this deadly terrorist attack, of this crime against humanity, under the valid agreement between ukraine and netherlands, we are ready in the full operation with the dutch side and other International Foreign agencies to conduct this type of investigation. Those who committed this International Crime, those responsible will be held accountable and together with the entire International Community we will bring to justice everyone responsible including the country which is behind the scene but supplied illegal weapon, provided the financial support, train ed thee men and supported and even orchestrated this kind of despicable crime. Ukrainian government will do everything to investigate this cri crime, to preserve the bodies, to provide any support in all respective governments and to up fold to the entire world the truth. Thank you. Ready to answer any question you need. Reporter can i ask if the priority at the moment is the recovery of the bodies, the removal of those bodies from the other crash site and moving them to amsterdam, if so, does the train have to go through donetsk, and if so, was it wise to begin military action in donetsk this morning . The key priority for us is to recover the bodies. To collect all evidences of these crime. As i already said, we recovered 272 bodies. 251 of which are already loaded in the refrigerators. We facilitated how to deliver these bodies to any distant nation which is needed, including capital kiev or amsterdam as i already said. In amsterdam we can get perfect forensic expertise as our dutch partners can provide wellequipped facilities. There is no indication of any kind of military activity or Counter Terrorist operation at the area of crash site. We do understand our responsibility because the key priority is to collect all evidences and to have thorough investigation. Reporter sir, how long are the negotiations going on . How do they happen with the discussion of the terrorists or whatever you call them. And the train can move as soon as possible, whats the timetable for that and how are you talking to them and who is talking to them . We have just lost the line there to the Prime Minister of y ukraine. Let me just recap what hes been saying, deepest con do lenses to the families of the victims and they want to have a criminal investigation, but those responsible for the plane downing will be brought to justice. He tied it to the country behind the attacks for supplying weapons. He also said that they orchestrated this kind of despicable act. He was very forthright in talking about russia or connecting russia to the attack that we saw. As far as those killed in the plane crash, he said that the government is looking to transport the bodies in the refrigerated trains right now back to the netherlands for forensic assessment. But he said that the rebels, he called them guerillas, said they are blocking and not allowing the trains to leave right now. So they are still trying to negotiate it seems a way to bring the bodies back to the netherlands. As far as the International Community is concerned, he said they need unhindered access to the crash site to lead us on to the meeting later today at the u. N. Security council and whether or not russia will give their consent to allow unfettered access. And the kept skeptic in me says even if they do i wonder what that means. And theres a hearing in the hague right now with the dutch Prime Minister calling on the u. N. Security council for a strong resolution on mh17. Hes also says that the resolution must include unrestricted access to the investigators. Lets bring in jim maceda back in. Jim, all the comment that is were made there by the ukrainian Prime Minister tie back to what you were saying as far as russia becoming a pariah state. Does any of this impact the way that Vladimir Putin continues to play the situation as far as his apparent influence on the Eastern Ukraine is concerned . Reporter no, it really hasnt impacted visibly yet. We are still seeing Vladimir Putin, the statesman, which he plays very well, paying lip service as he did just this morning to peaceful negotiations to end the war going on and throughout ukraine, but specifically now raging on in Eastern Ukraine. But hes showing no signs at all of concern about the growing International Indictment against him, the anger coming from all four corners of capitals of western europe and from the United States and all the reference to him becoming a pariah nation. Hes still blaming everything, at least indirectly, on ukraine and seems confident, Vladimir Putin does, that once again when push comes to shove, europe will not have the stomach to push through anything serious in terms of secretarial sanctions. And the current fullcourt press on Vladimir Putin in time will peter out. Jim, i hear you. I also want to ask you about reports in the press right now. Remember being in kiev talking to independent media there saying they were doing their best to offset some of the russia propaganda. I just wondered what the russian tv stations and the media there were making of the internationalization of this crisis. Reporter yeah, well, its the full court press on Russian Television. No question about it. Ive been watching it off and on for 30 years. Even when it was soviet. And im amazed now at the sophisticati sophistication that you see on the five or six russian channels. What the attempt is being made now is to basically dissect and simply contradict every single piece of key evidence that we have heard presented by or through u. S. Intelligence, through secretary of state, john kerry, on all the morning shows yesterday in the United States, whether its that conversations that we have seen. The audio conversations i should say that we have heard between russian handlers and their alleged russian separatist fighters talking act how they screwed up and that the plane they thought they were taking down turned out to be a civilian plane. Well, it turns out on Russian Television that that was a manufactured conversation based on fragments, audio fragments cleverly put together. Again, according to a russian expert, so again blaming ukraine for that rather than russia. And the overwhelming theory in the streets of russia and the streets of moscow here and elsewhere is that that plane was actually believed to be a president ial plane carrying Vladimir Putin because the colors of Malaysia Airlines was so similar to the russian official colors and was the Ukrainian Armed forces taking that plane out and did. Back to you. Thats incredible, jim. Thank you for that. Well come back to you later on in the show. We have the emerging director from solvent strategy here. You heard it there, the flight had Vladimir Putin on it and the you crepans were trying to bring it down. Does the threat of sanctions phase putin . Not for the time being. I mean, clearly the wait of International Public opinion is coming down on russia now like a ton of bricks. And it is becoming increasebly clear even inside russia, which i think is a very important point, that mr. Putin has bit up off more than he can chew here. What we saw on thursday looks and feels like a potential war crime. This is a gamechanging development in the fivemonth long ukraine yian crisis. This will either you night the west or dwit tivide the west fu. And it is a gamechanger for russia and the stakes couldnt be, couldnt be higher. Its interesting that you say the stakes couldnt be higher. Well look at the European Market reaction this morning to take you back to what we saw in the u. S. With the rally on friday. The markets dont believe face three sanctions are credible right now as far as european concerns. But right now we are showing the markets typically underperforming with the tension in russia and ukraine. We are seeing the general market down 1 . The cac is also under pressure with the ftse down 1 . We have to take a quick break, but still to come on the show, every little bit helps, but can tescos new man on the top make a difference . Stay tuned as we discuss this with the new ceo. Youre watching Worldwide Exchange bringing you Business News from around the globe. Welcome back to Worldwide Exchange. Here are your headlines. The ukrainians push back. Reports suggest Government Forces tried to break into the rebel city of donetsk. The Prime Minister has been speaking and continuing to make comments about the rebels. Europe threatens to ramp up sanctions against russia as they are accused of limiting access to the crash site of mh17. U. S. Secretary of state john kerry points the blame squarely on moscow. Its clear that russia supports the separatists, supplies the separatists, encourages the separatists, trains the separatists and russia needs to step up to make a difference here. The u. N. Calls for a ceasefire in gaza following the deadliest day of fighting since the conflict started. The death toll now topping 500. Changes at the top for tesco ceo Phillip Clark who will step down to be replaced by a relatively unknown exec dave lewis. Investors welcome the news sending shares higher. And shares tumble in dubai for a second straight session because of uncertainty about the largest builder arabtech. European markets absorbing some of the broader geopolitical news flow that continued over the weekend and into this morning. Right now the German Market is underperforming down 1 . We have seen the influence of ukraine and russia hitting the German Markets in particular right now. Its fared into the Sentiment Survey so perhaps no surprise we are seeing underperformance right there. And the bond markets are concerned to show the european periphery push higher to illustrate that point a touch wider. The u. K. Tenyear bond yields are down. And you have to assume that on fridays session, you have to assume that the support continues in the session today though we do see dollar yen a touch low er at 101. 24. And the euro dollar is a touch higher there. And in the hague he said the u. N. Security council must adopt a plan for mh17. He said all sanctions are on the table if the crash site remains and acceptable. He said the refrigerator train cars are not allowed to leave right now but they want the experts to do the work in the netherlands. Right now all measures against russia are on the table if the crash site remains inaccessible. The west is ramping up pressure on russia over its alleged role in the shooting down of malaysian flight 17. European leaders threat upped new sanctions against moscow as early as this tuesday unless accident investigators are allowed full access to the crash site. It comes amid mounting anger over the treatment of bodies with prorussian separatists accused of mishandling the remains of those who died on the plane. And china can use its permanent seat on the Security Council to shield russia from the mh17 which could come later today. Eunice is in beijing. China has its own regional issues and you have to assume they will take a soft line as far as russias potential involvement in this crash is concerned. Is that what we should be expecting . Reporter thats exactly what we should be expecting. Russia is finding support here in china. Over the weekend and today there were several editorials in the state press which have been highly critical of the wests approach. Saying that a country such as the u. S. And australia have been rash to implicate russia or to blame and point fingers at the moscowbacked rebels in Eastern Ukraine. The overriding temperature within the state press has been very soft on russia as you had said. And also what was interesting was that we saw a strain in the Chinese Media which basically took russias perspective on the ukraine conflict saying that the real culprit with this entire chaotic situation in ukraine and that a lot of that was because of western influence in the region. Now, a lot of this commentary really is pointing to the fact that china is looking past historical differences as well as past problems that its had with russia of mutual distrust in order to seek out a Common Ground with russia. Both countries have been having very strange relations with the west recently, especially when it comes to some of the regional issues. And it looks as though both countries are trying to find Common Ground with diplomatically as well as economically and thats one of the reasons why we did recently see president putin come out to china in order to solidify his pivot east. Eunice, thank you for that. Malaysian air shares are trading higher on buyout talks. We are standing by in singapore, sri, another devastating event for Malaysian Airlines. Whats the latest talk of what could happen to the Company Going forward . Well, there are some stark choices, really, julia. Bankruptcy or a bailout. And thats what it comes down to, but the stock did recover today up by 2. 5 . And theres a lot of speculation swirling around in the markets that the government will quite simply just bail out the company. And what we understand is that the state investor will buy out the existing 31 shareholding that it doesnt own. And essentially by doing so inject some money into the airliner. We dont have any timeframe or exactly when thats going to happen, but some believe it could happen, we could get an announcement sometime in early august. And thats one of the reasons why the stock did recover. And today by about 2. 5 , you have to understand that the reputational damage not only of mh17 although this was entirely of not their up making, plus mh370 is going to weigh on the company for quite some time. Very quickly, i do want to update you on whats happening on the ground in kiev because a transport minister of malaysia is there. He will hold a press briefing later on today. We also can confirm that the foreign minister of malaysia will touch down in kiev in a few hours time as well. So julia, more pressure is being brought to bear to try to gape access to the site when 44 malaysians are among the site there. We have to wait for the u. K. Meeting later today. Nick is still with us, we were talking briefly about the markets this morning and it feels to me like as far as the markets are concerned here they dont believe phase three sanctions are credible right now from europe. And it doesnt seem to be that putin believes they are either. Absolutely. The markets have been giving mr. Putin the benefit of the doubt for quite some time. Some would say they have been doing his bidding here. Clearly, the reason why markets are also extremely resilient. This is basically a tug of war between countries specific geoPolitical Risk and central bank lodges are clearly hands down winning this for the time being. The markets are clearly becoming a lot more sensitive to geoPolitical Risk. And this ukrainian crisis clearly is a gamechanger right now. Are they sensitive to the market . I think the market certainly volatility is certainly rising. And the stakes are really increasing day by day. And the underlying sentiment is still obviously positive. But this is a very extremely precarious moment. Very quickly, this weekend they said europe is one shot away from deflation. Do you believe this could ultimately be the shock that pushes europe in that direction if we do step up to phase three sanctions and have the Financial Energy implications . First of all, i doubt that we will, in fact, step up to full meaningful aggressive stage three sanctions. There will be still be a fair amount of clear blue water between the u. S. And europe when it comes to ukraine. Great to get your thoughts. Thank you. Now in corporate news, teteo announces that its ceo is stepping down and dave lewis will take his place. This marks the end of a disappointing three years in charge. Investors are in the red on the back of tescos news. We have the senior and list at sanford here. In the last year things went from bad to worse to worse. And you just look at the latest numbers, tesco went backyards by ten years in the last three years. Something had to happen to stop the market share decline. The chairman said this is not about a change in direction. It is not a change in strategy. That to me sets alarm bells ringing. You would laugh if it wasnt so sad because how bad do the numbers have to be before you change strategy . You can see people are exiting and switching out of tesco for all the right reasons. So in my view, they need a new ceo and new strategy very quickly. Let me play devils advocate. More numbers are positive on this stock because they said part of the criticism is they have the hyper markets out of central locations, but now they are introducing coffee shops, cafes and gyms. And this could be a gamechanger for tesco. Do you buy into it . Not at all. The biggest reason for people to choose a store is not because theres a gym nearby. Phillips dream of me shopping with my two boys would be on saturday morning, drop my kids off at a soft play, do my shopping with the wife, have a coffee, have Better Things to do on a saturday morning than to have some entertainment and occupation in the store. Tescos structure is challenged and it wont be easy for them to get out of it. And putting in coffee shops doesnt change the reason why you shop somewhere. The Ceo Dave Lewis gets price wars and thats something ultimately crucial for this sector and for tesco, in particular. Hes a tall epted executive so i give him the benefit of the doubt. In my view the low price is low cost. And tesco has big stores way too expensive to operate. So you need costcutting to develop a low cost format to compete for customers. And that takes time. That tyakes time and everyboy shops at tesco. This is something that the chairman just said is not going to happen in quotations. I read as well that little is going to be selling vintage wine. So they are kind of moving into a sort of higher priced product line, too. This cannibalizes tescos Consumer Market for a different reason. Yeah, i just happened to have it on saturday morning we did buy a nice french wine. So i must say it did make me happy, but clearly little is doing something really well, but the real low prices are based on cost. And tesco cant compete with that of expensive stores. Bruno, Senior Analyst at sanford bernstein. After gazas Bloodiest Day, will they get a break . We are live from tel aviv after the break. L center. Im spending too much time hiring and not enough time in my kitchen. [ female announcer ] need to hire fast . Go to ziprecruiter. Com and post your job to over 30 of the webs leading job boards with a single click; then simply select the best candidates from one easy to review list. You put up one post and the next day you have all these candidates. Makes my job a lot easier. [ female announcer ] over 100,000 businesses have already used zip recruiter and now you can use zip recruiter for free at a special site for tv viewers; go to ziprecruiter. Com offer2. You are watching Worldwide Exchange. The latest shareholder arabtec says it will meet on thursday to review the Second Quarter results and other recommendations. The ceo quit last month and the state fund is expected to buy some of the 28 stake, but so far it refused to clarify how much it is willing to buy. Heather gamble is joining us now on this story. A lot of focus is on the impact that this Share Price Movement is having on the border market, do we assume it is down to this and not the broader implications because the proximity to what is happening in israel and gaza is very close. Sometimes theres a tendency to sort of bunch everything target. Its happening in the middle east region and impacting the market. Thats with dubai and not the case. Generally dubai will rally with unrest. Whats happening here is arabtec is the most heavy traded stock on the dubai index. And this is an index dominated by property stocks. Not oil, aviation, its mostly property construction. So whats really the problem is something evolving over the last year. You had the ceo come in over a year ago. He was harolded as someone bringing change and going to bring all the new projects to dubai. The stock was soaring, life was good. Unfortunately, it was felt in some circles in abu dhabi that was a bit big for his britches. They decided to oust him in midjune and unfortunately doing this the stock tumbled and people were very, very concerned about how much support all of these investments and all the cop instruction projects really had from abu dhabi. So it was like abu dhabi cutting its nose off its face. This is something you dont want to see happening. You dont want a situation where the government is essentially saying that we are not we are going to do this and get rid of this guy, but we are not going to put a plan in place to calm investors. Right. So we have to wait and see what they say on thursday and get a sense of how much they will buy potentially. Hadley, great to have you on. Denials of hamas capturing an israeli soldier after two weeks of fighting on sunday. 100 palestinians were killed yesterday alone with the death toll topping 500. The u. S. State Department Confirms john kerry will travel to cairo for meetings with egyptian and other senior officials as they look to broker a ceasefire. Speaking on minneapolissnbcs press he says this there cant be a set of predemands to be met. So we support the Egyptian Initiative joined in by israel and others to have an immediate ceasefire and were working that ceasefire very, very hard. Nbc news Foreign Correspondent Martin Fletcher is joining us now. John kerry is heading to cairo. Is he going to find a mute point between the egyptian ceasefire and the proposal that hamas favors . Reporter well, julia, that is certainly the hope. And thats why hes coming here and the u. N. Secretary general is also involved in the same effort to bring the two proposals closer. But the two parties involved, israel and hamas, they dont seem to be moving closer in the slightest in terms of the negotiations. The opposite, israeli leaders are going to intensify the fighting in gaza and the fighting is becoming much more intense over the last 24 hours. So yeah, hope that a ceasefire proposal can move forward and that kerry will have impact on that. But the reality on the ground now is that both sides bearing the dead from yesterday, the worst day of the fighting so far, more than 100 palestinians killed in gaza. 13 Israeli Soldiers were killed and about 50 wounded. So that was a heavy day of fighting. And today the fighting is just continuing. The israelis do say they are hoping there will be some Movement Towards the ceasefire negotiations, but hamas is not yet showing any flexibility. They say they are going to continue fighting until all the demands are met and theres no chance of that. Martin, thank you for that. Stay tuned to 11 30 cet as we get the palestinian reaction to developments. We are speaking to dr. Hanan ashrawi, the executive Committee Member of the palestinian organization. Now to some earliest news. Phillip says it expects corporate price to rise in the second half of this year as the Dutch Health Care and Appliance Group announces disappointing results. Julius baer shares are higher after a tax probe with the u. S. This year. That will satisfy the settlement. And they posted a 56 jump in net profit in the first half. Bskyb requires a 70 loss in productions. Meanwhile, sky deutsch is also higher. Tim, lets start with bskyb, what next . Well, whose move next, a game of chess, huh . We are seeing repositioning of the whole murdoch issue and the ultimate price is what happens between fox and time warner as the 80 billion prize at the end of it. We have seen with the move of itb being sold out last week, bskyb is clearing out the budget sheet. The european Sky Initiative is going to release cash ultimately back to fox. Fox can use that. And theres a whole repositioning here. Tightening up here, much cleaner for shareholder miss the long run. But tend game here looks quite interesting. And much, much more favorable for sky shareholders. Skydeutsch said a significant portion of cash could help fox renegotiate the structure of the original 80 million deal. I think, you know, in a zero sum game, you cant say one is a winner, but when you see the minority interests and where control rests and what the government rights look like, i think its a much cleaner picture. The end game is what fox and time warner do, whether or not they do get together talking on and off throughout the year. And thats another story, but from the bskyb point of view, this looks like a positive solution in the coming months. Lets move to julius baer, this is a restructuring story and process of reintegration. One of the most stable european players with Credit Suisse having their issues. These guys have to move on. The price for them is Merrill Lynchs private wealth. The european operations are bit by bit. Thats given a few bumps and bruises on income, but the civilian numbers arent quite light for light, but they are very progressive. We are seeing cost income ratio reflecting the fact they are bringing Merrill Lynch operations in and have to manage down the cost on those. I want to bring in the cost to income ratio dropping to 17. 8. Theres a report saying the private banks, as much as their income is raising, their costs are increasing more. And the industry right now as far as the cost income ratio is somewhere between 83 . So on a comparable basis, julius baer is looking healthy. This gives them the chance to move and integrate to Merrill Lynch. They knew it was going to be expensive. Look at morgan stanley. They are doing something similar, selling out the european operations. Thats a much bigger challenge as that integration has gone on. Across the industry, youre looking at costincome ratios possibly pushing up to about 80 . The that drops through to the bottom nine. When you look at where the Tax Settlement may or may not come in the u. S. , we are talking possibly about a billion suisses to work through. Thats pretty much priced in by the markets. What that does offset is the fact that trading activity and fixed income activity for their clients and their business is going to be flat this year, but the Earnings Growth is coming through. Cost income ratio is going to be higher. Tim harris, great to have you on. Still to come, the russian growth taking a bigger hit and the fallout from the Ukrainian Air disaster, the next guest is bullish on the economy but has he changed his mind . Stay with us, well find out. Welcome to Worldwide Exchange. Here are your headlines from around the world. Reports suggest ukraines Government Forces are trying to break into the rebel city of donetsk. The Prime Minister says those responsible for mh17s downing will be found. Together with the entire International Community, we will bring to justice everyone responsible. Europe threatens to ramp up sanctions against moscow as prorussian separatists are accused of limiting access to the crash site. U. S. Secretary of state john kerry points the blame squarely at moscow. Its clear that russia supports the separatists, applies the separatists, encourages the separatists, trains the separatists and russia needs to step up to make a difference here. The u. N. Calls for an immediate ceasefire in gaza following the deadliest day of fighting since the conflict started. The death toll now topping 500. And change at the top for tesco. The ceo will step down in september to be replaced by dave lewis. Investors are welcoming the news sending shares higher. Youre watching Worldwide Exchange bringing you Business News from around the globe. The west is ramping up pressure on russia over its alleged role in the shooting down of malaysian Airlines Flight 17. European leaders have threat upped to level new sanctions against moscow as early as tuesday. Unless accident investigators are allowed full access to the crash site. It comes amid mounting anger over the treatment of bodies with prorussian separatists accused of mishandling the remains of those who died on the plane. Speaking earlier, the y ukraine yain Prime Minister says justice will be done. Those who committed International Crime, those responsible will be held accountable and together with the entire International Community we will bring to justice everyone responsible, including the country which is behind the scene. Despite International Criticism including talk of a u. N. Security Council Resolution to allow access to the area, Vladimir Putin is calling for the full security of the International Commission at the site of the crash. The russian president is promising Everything Possible to end the fighting in ukraine. Translator we must do everything to guarantee the International Civil aviation organizations full total safety and secure the necessary humanitarian corridors for its work. From the site of russia, we are doing everything that depends on us so that the conflict in Eastern Ukraine moves through todays military phase to the phase of talks at the negotiating table where only peaceful and diplomatic means will be used. Nbcs jim maceda is in moscow. We have been talking all morning about the internationalization of this crisis. I just wonder if theres anything in your view that actually could make putin cut ties with the rebels here. Reporter well, i dont see anything at this point, julia. We are talking a lot about secondtorial sanctions. That might work if we are really talking about secretarial sanctions. The whole financial sector, a whole energy sector, that could with a cumulative effect, scare putin, perhaps, if he starts to see crisis plummet, if he starts to see demonstrations in the streets because people start losing their jobs or losing their pensions. But otherwise putin is pretty much locked in ideologically to defending russians, ethnic russians, not only in donetsk and the Eastern Ukraine but throughout the, what he calls the whole region. He has staked his political reputation on that. People know that. People love him here for that. Russians have given him Something Like an 83 , i believe, Approval Rating in the latest gallop poll. So hes hes not likely to cut ties at all. And weve heard, i must say, some remarkably angry comments from about russia and against putin from the likes of the Prime Ministers today in us a tra australia and the netherlands, but none of that bitterness, none of that anger seems to sway putin at all to really take or make any move to ease ties much less cut his ties with the rebels. You know, theres been a lot of talk about the crash of mh17 being a gamechanger. No one has seen that so far. But we have seen instead the war raging on, there are unconfirmed reports now from a russian rebel leader of fighting going on inside donetsk city, a city of 1 Million People with tanks in the city center. So what we are seeing once again is putin paying lip service as he did today but using proxies to defend his interests. Back to you. Thank you, jim. Speaking on nbcs meet the press secretary of state john kerry said this disaster should prompt a stronger response against moscow. We have taken tough sanctions. We hope this is a profound wakeup call to those countries in europe that have wanted to kind of, you know, go slow and soft pedal this. The chief global economist is joining me now, charles, putin doesnt seem fazed by the sanctions. If what we have seen already is like the euro bond last month issued 4 , trading today near 4. 5 , that could still happen and the existing sanctions today could issue another bond tomorrow. So europe may equal sanctions for the bank. Does putin care . Most of the institution sanctions so far need some time. Do you think the sanctions will happen . Because at the end of june you were saying, the russian equity markets are cheap here for good and bad reasons, and the phase three sanctions are unlikely. Have you changed your tune . We said that iranstyle sanctions are unlikely and still look unlikely. I was looking at trade data this morning. Netherlands is the number one export market for russia according to russian data for the first five months of the year. According to dutch data, the dutch are importing 38 billion worth of goods last year from russia. Thats a big mutual trade and hasnt been touched by sanctions yet. Do you think is a gamechanger on the dutch side here . I really think the dutch have got an awful lot to get through right now. The Public Perception right now surely will push for something greater. In europe. It took such a long time for europe to agree, 28 countries to sit down and where does russia stand on the iranstyle sanctions . They are concerned, very concerned. So the officials we were seeing a month ago would be deeply worried about irans sanctions. And i think what iran showed, i was there a few months ago, was the impact on iran exports that brought gdp down by 6 . It was not the financial sanctions, i dont think. It was the oil drop of 40 of exports and 38 of iranian export that is wiping out their gdp. Over time, perhaps. So farce youre concerned, the probability of seeing any kind of Significant Energy sanctions from europe is still not going to happen, the probability is negotiable. We have been watching since march. And if libyan oil got back on stream, if irans sanctions were dropped so you can start importing Ukrainian Oil and gas, then it begins to change over a medium term rising, but we are not there yet. In the meantime, russian growth is surprisingly decent. This week they reduced growth estimates to a negative 1 for russia. Your at 1. 6 in 2004. Why such a huge difference . What do you know that everybody else seems to not know . Well, we have been watching Approval Ratings. Putins Approval Ratings in russia are around 80 or more according to the weekly polls from the center. That is telling you that the average russian is feeling pretty pleased with this president. This is not taking into account the last three to four days, but nervo nevertheless, very high Approval Ratings. Credit growth at 20 . People have foreign mortgages like never before. With Approval Ratings up so high, 80 plus for a reason. Its mutual. What our economists do is will be the next Central Bank Governor of russia one day. Hes a young guy consistently saying that the approval for russia encourages people to consume or consider consumer and that consumption creates jobs and russia is equal unemployment and that has a positive effect. So we are still looking for around 1. 5. The latest indicators we were suggesting suggest acceleration of growth into the Third Quarter to 2. 3 year on year. Thats likely to get cut back now that oil prices have dropped, but it is still positive. Your message for european leaders is if we are not looking at iranstyle sanctions then putin is not bothered right now. Its not going to hurt him too much. Got it. Charles, global chief economist at renaissance capital. Thank you for that. Staying in the region, russia has reached a deal to ak steel and Steel Dynamics for 2. 3 billion. The Financial Times says they plan to reduce costs. Bankers are worried the eu sanctions could cut western companies out of the markets, but they have been looking to sell the plants since the end of last year and the timing is not likely related to tensions between washington and moscow. Ak steel and Steel Dynamics are trading higher in the session. Steel dynamics is higher by just over 1 . Lets take a look at the other top stories. Activist investor Elliott Management is taking in more than 1 billion stake in emc and plans to call for the breakup of the data storage giant. The wall street journal says the stake makes this the fifth largest shareholder. The firm will try to convince them that their stock will get a big boost if its spunoff. The shares for emc are higher by 2. 2 . Trading firms are raising concerns about barclays dark pool months before the attorney general Eric Snyderman sued the bank in june. Hes accused barclays of giving highspeed traders an unfair advantage even though it promised investors it would be safe from predatory traders. The wall street journal says big trading firms noticed they werent getting the best treatment likely because of highspeed trading. Barclays is expected to respond to the lawsuit this week. Right now the shares are trading down 1. 3 in the u. K. Market. It was four years ago today that dodd frank u. S. Reform bill was signed into place by president obama. 190 rules have yet to be finalized and many of the deadline requirements have been missed. Republicans on the House Financial Services committee are releasing a new report today critical of the law. They say dodd frank has failed to end the prospect of government bailouts of big financial firmses aer ba s a e negotiation they are too big to fail. And we are seeing consent in the European Markets filtering in. Right now the s p 500 is down by 4. 5 points and the dow jones is 35 points lower and the nasdaq is five points lower. Well be talking ukraine and russia after the break. Stay with us. Developers are all about speeds and feeds. Its all about latency. Its all about how fast does it run. I often sit with enterprises who ask me about how Mission Critical and hows the performance of the cloud. And i tell them, if you can make gamers happy, you can make anybody happy. Speed is made with the ibm cloud. The ibm cloud is the cloud for business. Welcome back to Worldwide Exchange. Violence in ukraine is now an international matter. The u. N. Is calling for a ceasefire in gaza and markets get ready more than a quarter at the s p report this week. If youre just tuning in, thank you for joining us on Worldwide Exchange. A look at how futures are trading ahead of the opening of the market, we saw gapes in fridays session. The s p 500 gaped 1. 6 . The nasdaq up 1. 8 . We have geoPolitical Risk there continuing to influence investors. Trading activity right now to some degree is about a quarter of the s p with 12 dow components reporting this week. The European Markets are trading lower in this session very much focusing on whats happening between russia and ukraine with the ongoing fallout of the crisis there. Not surprising we are seeing the German Markets. We have bounced off lows earlier in the session. The German Market is down 1 now just down. 67 . Thats it for the european roundup. Well look at todays top stocks. Tesco right now announced Phillip Clark will be replaced by dave lewis in october. This comes as the food retailing giant warned of a missed target for this year marking the end of a disappointing three years for the man in charge. In the food retail sector, sainsbury is in the red on the back of tescos news. And a settlement with u. S. Authorities is expected to be reached over a tax probe this year. They also posted a 56 jump in net profit in the first half of the year. Meanwhile, back to our top story. The Malaysian Air shares are trading higher on potential buyout talks. Sri is standing by with us this morning. You outlined this earlier, just what are the stock choices . It is bankruptcy or bailout. The market seems to be believe that a bailout of the Malaysia Airlines is imminent. I must stress theres no official word on this as of yet from the state investor, but the speculation is pointing to that. We may get some kind of announcement as early as august. And what this means is that kazana would essentially by the 31 stake they dont already own in Malaysian Airlines. That would be a cash infusion. It is worth pointing out, julia, that the company is really on the bring at the moment. The three successive years of losses. And a lot of and lists are telling us that the company will not be able to continue or will go bankrupt in 2015 if there is no capital injection. So thats where we stand at the moment. And thats why the shares did recoup some of the very sizable losses. Doubledigit losses, in fact, that we saw on friday with the stock up 2. 5 . Let me just give you an idea of whats happening from the malaysian government perspective because to their credit they have been dispatching a lot of senior figures to kiev to demand greater access to the crash site. Remember, of course, that more than 40 malaysian internationals were on board mh17 and were killed quite tragically. So the latest here is that the malaysian transport minister will hold a press conference in kiev later on today. No time is fixed according to the Information Ministry official i spoke to. And what we also know, i can also confirm to you that the Malaysian Foreign minister will touch down in kiev later on today in several hours according to the Information Ministry. So its very clear here that malaysians are putting a fullcourt press to demand greater access to the crash site. Julia, back to you. As is everyone, sri. Thank you for that. Now coming up, cigarettemaker rj reynolds is told to pay 22 million in damages to a widow of a smoker who died from cancer. All details after the break, stay with us. Welcome back. The s p 500 indicating lower right now by around four points. The dow jones lower by 29 points. And the nasdaq two full points lower feeding the sentiment we are seeing in the European Markets this morning that we have bounced off some of the lows here. It does come off the back of strong gains on fridays session as the dow gaining. 70 . The s p and nasdaq gaining just over 1 . A big week for earnings this week. A quarter of the s p 500 reporting 12 dow components offsetting that from the news we get from that and the ongoing geoPolitical Risks. Straight to the top story now. Reports are coming in from the ukrainian pushback saying the Government Forces are trying to break into the city of donetsk and fighting is underway near the railway station. Joining us on the phone is the correspondent at the wall street journal. Paul, thank you for joining us. Just tell me first what youre seeing and what youre hearing now. Reporter yeah, so basically the big two pieces of news today out of donetsk is the dutch forensic investigators have arrived here in the city. And i believe they are planning to go to the crash site, so thats the first sign we have seen of International Investigators rather than observers. The second big piece of news is that there was fighting near the donetsk rail station. This is the first siting we have seen in the Donetsk Region since the crash happened. So if there are if the ukrainian side is responsible for that and trying to make military gains while this is going on, this is going to be a big scandal. But it is unclear at this point who started, which side of the rebels started this, or if ukraine started this on the outskirts of the city. From where you are right now you can hear explosions, is that right . We have heard several reports of military activity going on in donetsk itself, is that right . Reporter i have not heard explosions from where i am. It was overnight and earlier. I am headed out there now and people say there are signs that there were fighting on both sides close to rebels and the y ukrainian side says something was going there. So amid all the calls for a ceasefire, its pretty disconcerting for something to be going on right in the exact city itself. Is anybody actually talking about the possibility of a ceasefire here . Have you managed to speak to any of the prorussian separatists or the rebels there . Do you get a sense of what they are saying there as a result of the crash . Yeah, so as you probably know, there was a ceasefire before and it was essentially a complete failure here at the entire ceasefire from both sides accusing each other of breaking it. And while russia and europe and the u. S. Have all now called for another ceasefire, particularly at this moment so people can investigate the crash site, we havent seen any indication of a willingness to do that on the side of ukraine or the rebels. The mistrust is so deep and so high. Thank you, paul. Paul sonne reporting from the wall street journal. As gaza has had the Bloodiest Day, we are live in telaviv to get the latest. And the palestinian liberal organization executive dr. Hanan ashrawi is going to join us on the phone. Stay with us. Welcome to Worldwide Exchange. These are your headlines from around the world. Reports suggest ukraine Government Forces are trying to break into the city of donetsk. The ukrainian Prime Minister says those responsible for the downing of the plane will be found. Together with the International Community, we will bring to justice everyone responsible. Europe threatens to ramp up sanctions against moscow as prorussian separatists are accused of limiting access to the crash site. The u. S. Secretary of state john kerry points the blame squarely at moscow. It is clear that russia supports the separatists, supplies the separatists, encourages the separatists, trains the separatists and russia needs to step up and make a difference here. The u. N. Calls for an immediate ceasefire in gaza following the deadliest day of fighting since the conflict began. The death toll now topping 500. And changes at the top for tesco. The ceo Phillip Clark will step down replaced by exec dave lewis. Investors are welcoming the news sending shares higher. Youre watching Worldwide Exchange bringing you Business News from around the globe. If youre just tuning in, thank you for joining us on Worldwide Exchange. Heres a look at how the markets are faring ahead of the u. S. Equity open right now. The u. S. Futures indicating slightly lower right now. We have the dow futures indicating lower by around 20 points. The s p 500 right now lower by 2. 5 points. And the same story for the nasdaq right now after gains we saw on fridays session, 1. 6 gains for the nasdaq. And the s p also gained 1 . We have bounced off lows from the trading session. The micex is under water in russia down 1. 3 right now for that market as the west powers talk about the risk of further sanctions on russia and what to do as far as a broader International Investigation is concerned. We also have the u. N. Security Council Meeting later today. Israels ambassador denies claims from hamas that it captured an israeli soldier. This is gaza seeing its Bloodiest Day of two weeks of fighting on sunday. 100 palestinians and 13 israeli troops were killed yesterday alone. The Israeli Death toll is the highest since 2006 offensive against hezbollah. The palestinian president Mahmoud Abbas accused them of being responsible for the attack that killed 60 people yesterday. We support the Egyptian Initiative joined in by israel and others to have an immediate ceasefire and were working that ceasefire very, very hard. Martin fletcher is joining us from telaviv now. Both president obama and john kerry expressed concern of the death toll over the weekend. Is there anything in that to give israel pause for thought at this stage . Reporter well, julia, pause for thought, i cant say because what they are saying is they can intensify the operation rather than reduce it at this time. Now kerry was caught off mike speaking with fox as you might imagine saying this is a pinpoint operation talking about israel as well. The israelis do believe it is a pinpoint operation but it is impossible not to hit civilians with the fighting inside the civilian area. Israelis say they warned the residents of the area for two days to leave the area before they moved in. And this is the unfortunate result they say of some of them not heeding the warning. Theres been very heavy fighting in that area. 13 Israeli Soldiers killed yesterday and more than 100 palestinians killed altogether. So at lo of funerals on both sides of the border today. And the fighting continuing with the hamas gunmen bringing the fighting inside israel today. The gunmen infiltrated through a tunnel and were spotted by israel. The gunmen split into two groups and one of the groups was hit from the air by rocket fire from israel killing all of them. And the other was raided in a gunfight. So the israelis say ten palestinians were killed inside israel but also there are israeli casualties but no numbers confirmed yet. As i said, if anything, the fighting is intensifying. Everyone is waiting for john kerry to arrive hoping that in some way hell be able to move the ceasefire talks along. But at the moment its a bit of an impasse. The egyptian proposal has been rejected by hamas. The turkish governing proposal is not yet on the table but has been rejected in advance by israel. So kerry has his work cut out for him. And the u. N. Secretary general is in the area. And they will be putting pressure on both sides to stop the fighting, but theres no sign right now of that happening. If anything today, julia, it is intensifying. Absolutely. As they meet in the middle proposal, is that acceptable to israelis . Well find out, Martin Fletcher, correspondent at nbc news. The executive Committee Member of the plo, the Palestinian Liberation Organization is joining us on the phone. And i am also joined here onset. Dr. Ashrawi, thank you for joining us. Yesterday they accused, the government, accused them of selfgenocide. How do you respond . I cant believe this. This is physically blaming the victim and one way in which israel is rushing the situation. Israel is an occupying power, the Strongest Army in the region, the fourth Strongest Army in the world occupying gaza since 1967. They have been under siege by air, sea and land for the last seven years come barding and shelling and pounding and killing innocent civilians and then blaming the palestinians for their own deaths . This is incredible. 511 palestine januaians have ben to air by sea and land. 3,604 have been injured. Over 120 children have been killed. And israel deliberately is targeting them. And then it tells whole neighborhoods to leave their home because the army wants to come in and it doesnt want to see any buildings or homes in place in this raid. And it wants to invade safely. And they have nowhere to go. This is the most densely populated area in the world. They have nowhere to go. People who were trying to run away from their own homes were bombed and killed. There were bodies strewn in the street. I cant believe the type of language and distortion and outright lies that are being used. At this time we look at the facts and we do with the real issues, not with propaganda. Two questions on the back of that. Do you deny then that hamas is using men and women as human shields . And i just wonder, for you specifically, are you able to influence hamas now in some kind of negotiation process because i think theres a perception on the part of hamas that youve sold out to advertise israelis of course many palestinians are disappointed because the leadership has been committed to negotiating settlement and has been unable to deliver and unable to bring israel to compliance with International Law on the minimum level of human decency. We have been unable to honor this commitment, so our agenda of a negotiated settlement has not succeeded. And in that sense we feel like we have not been able to protect the palestinian people. And many people say thats why the palestinian leadership can become relevant because a Strong Language of violence, israel is system atticly using violence without response from us other than International Law legality, decent morality, peaceful negotiations. So the people responded to them in their own language, and this is what we didnt want. However, we do have a national and internal dialogue going. We do believe that we should save lives. The bloodshed has to end and end immediately. But at the same time, we are trying to not go back to the status quo. And john kerry should know it, but because the status quo is what brings on the israeli invasion in which they pound gaza and blow it to smithereens and then continue again the next two years where we dont have food and medicine and the supplies. We dont have building supplies. And then they are bombed again. We need to see whether john kerry can influence the situation now. Thank you so much for your time this morning. Dr. Hanan ashrawi, the palestine Liberation Organization Committee Member there. What difference can john kerry make here and can he find a midpoint between the turkish proposal for a ceasefire and the hamas side and what they want to see, its a mess. Poor john kerry has his work cut out for him. We have seen little to no progress in all the trips hes made since becoming the u. S. Secretary of state. No Peace Process is underway. A ceasefire is the best he can hope for at the moment. The major problem now is that the United States has said they want to back the egyptian proposal. Unfortunately, hamas is not talking to egypt and not interested in the proposal as we stated. So at this point john kerry is going to land in cairo and is landing in the wrong place. And hes going to be talking to the wrong people. And until they can refigure this narrative to where somehow hamas is involved and feels as if their economic interests will be met in some way, i dont think that youre going to see them in terms of letting up. And they are not going to stand down, i should say. And israel is going to have to continue because thats what we said several times in the past. Politically, netanyahu is seen as weak. What if anything will make israel the blockade here. Because ultimately thats what hamas is asking for, the primary commission. Unless they feel that the threat of hamas has been neutralized, and unfortunately that requires they stay in gaza longer and it will be more messy and more bloody and there will be more casualties. Thats the unfortunate part of the whole story. Thank you. Well look at the other top stories. Aig recovered more than 2 billion in settlements over mortgage bonds that pushed hem to the bring of collapse during the financial crisis. The Financial Times says the deal means aig is unlikely to pursue legal action against banks for selling mortgages back in 2008. They reached a settlement with bank of america and has recouped 1. 3 million in several out of court settlements. Aig is just higher by 1. 3 today. And a verdict by a florida jury awarded 23. 6 billion in punitive damages to the widow of a smoker who died of lung cancer. This is one of thousands filed in florida after the state Supreme Court threw out 145 billion Class Action Settlement with Tobacco Companies back in 2006. Legal experts say it is highly unlikely punitive demands will stand on appeal. R. J. Reynolds is lower by 1. 7 in the german trading session. Lets give you act loot what is on todays agenda in the United States. No econom take a today and the focus will turn to earnings with more than a quarter of the s p 500 reporting. Today well hear from halliburton, american mobile, netflix and Texas Instruments among others. After the break, another investor is set to strike taking report at enc and calling for the breakup of the data storage giant. All the information is right after the break. We are back in two. These are your headlines. The u. K. Prime minister says violence in the countrys east is now an international matter. The u. N. Calls for an immediate ceasefire in gaza. And markets get ready. More than a quarter of the s p report this week. Activist investors have set their sights on several Big Companies over the past year pushing for changes at ebay among others. And now they have a new target in mind, and thats emc. Morgan is here with more details from hq. Good morning. Tel good morning. Elliott mortgage is announcing a 2 stake making elliott the fifth largest shareholder. One of the largest position an activist investor has taken. Breaking this down, emc is made up of three separate businesse. , the journal says elliott will try to convince them to spin off 80 of their market cap for about 75 of emcs value. If it splits off, vmware and several propen shl buyers could emerge for part of emc. Oracle and hp could be interested. Emc reports Second Quarter earnings on wednesday. The last quarter profit fell 30 while the Company Shares have merely doubled over the past five years. The nasdaq has gained 135 and the dow jones computer hardware index is up 171 . Some analysts have said emc stock doesnt fully reflect the value of its storage business and a spinoff could address that. The journal says Elliott Management plans to meet with the chairman and ceo who is expected to retire next year. The activist investors played a big factor in the tech sector in recent years. Value act recently got a seat on microsofts board. Elliott management also has a successful track record after taking stakes in Juniper Networks and net app. Back to you. Rory mclroy joined the golfing elite on sunday by becoming the third player after tiger woods and Jack Nicholas to win three majors by the age of 25. The northern irishman went into the play six clear and reduced his lead to two shots but he managed to hold his lead to finish 17under winning the british open for the first time. That didnt come as a surprise to rorys dad. Jerry mclroy placed a bet of 100 pounds each that rory would win the british open before turning 26. The odds were 500 1. Rory turns 26 next may and his friends will split roughly 371,000. Smart dad. Now it was a fairy tale ending to the german grand prix for the home race to be extended in the world championship. Louis hamilton moved from 20th on the grid to finish on the podium third agonizingly short of second place. Up next, a huge week for u. S. Earnings with a quarter of the s p 500 reporting. But will geopolitics overshadow the results . Well head to chicago for a little insight. Stay with us. Xkc welcome back to Worldwide Exchange. A look at the yoEuropean Market. The German Market is down 1 earlier on in the session. But we are seeing the mycex in russia down 1. 4 briefly falling below the 1400 level earlier in the session. The lowest its been since midmay. The focus remaining on what the investigation is going to look like if and when we sign up. And also the u. N. Security Council Meeting is taking place later today. The belief is that russia will accept a resolution to allow unfettered access to the crash site. And then we move from there. Obviously, this is remaining our top story today. The west ramping up pressure on russia over the alleged role in shooting down of malaysian flight 17. The european leaders threat upped new sanctions against moscow as early as tomorrow. Unless accident investigators are allowed full access to the crash site. This is amid anger over the russians accused of mishandling those who died on the plane. Earlier the ukrainian Prime Minister said justice will be done. Those who committed this International Crime, those responsible will be held accountable and together with the entire International Community we will bring to justice everyone responsible, including the country which is behind the scene. U. S. Secretary of state john kerry said the disaster should prompt a stronger european stance against moscow. Weve taken tough sanctions. We hope this is a profound wakeup call for those countries in europe that have wanted to kind of, you know, go slow and soft pedal this. U. S. Futures this morning right now indicating lower by around. 10 for the dow and for the s p relatively unchanged after gains for the nasdaq of 6 on friday. And the seven out of ten sectors positive for the week led by tech. A quarter of the index is reporting this week and 12 dow components. Joining is ben lichtenstein, the geo Political Risk is on the list this week, what dominates . Well, i think that geopolitical for the most part in terms of a volatility or an unexpected volatile type swing, but over the longer course, if you will, i think that the Economic Data that were going to see and the earnings reports as well as the Technical Levels will definitely play. But for the most part, this market is Still Holding very strong. The only real concern right now that were seeing is this diversion type activity that continues to develop amidst the rustle versus the other majors, versus the dow, the s ps and the nasdaq. The other three majors, you have the dow, s ps and nasdaq fully experiencing great levels. The dow is holding at the 17,000 level, but the russell is trading at the 1144 level. So thats significant but yet if you continue to watch the price activity in the other majors, you have to give the benefit of the doubt to the bull still as the market continues to seek value higher. We are talking about the risk of geo political influence on the markets. We did see the dollar looking relatively bid last week. Is the bias a protection against a further spike in volatile till, ben . I think we saw a few safehaven products received. You saw the dollar as you mentioned and the gold spike. And you see the bonds receive a little bit of flight to safety, if you will, or the safehacven trade. But the dollar has been a bit sideways so well see. Thank you, ben. And thats it for todays show. Im julia chat knechatney. Squawk box is coming up in a few minutes. Like the passat. And also in the funtodrive jetta. In fact, volkswagen has sold more turbos than any other brand over the last ten years. That is a lot of turbo. Vo hurry in and you can get a 1,000 turbocharged reward card when you lease a new 2014 passat s for 219 a month. Good morning and welcome to squawk box. Two major geopolitical stories to focus on. Theres unrest in the mideast. Plus the Bloodiest Day of fighting so far in the twoweek campaign on the gaza strip. And heightened tensions between russia and the west. Global leaders voicing concern that the russiabacked rebels remain in control of the Malaysian Airliner shot down over ukraine. And wall street has a busy week ahead for earnings report. And key Economic Data it is monday, july 21st, 2014. And squawk box begins right now. Good morning, welcome to squawk box. Im Andrew Rosssorkin along with joe kernan and Michelle Carusocabrera is here in for becky quick. Ukraine is looking to hand over the investigation of the crash to international partners. The bodies were loaded into refrigerator crews. People wearing gas masks and gloves moved bodies in body bags into train cars in a town near the crash site. International outrage of course is growing. This australian Prime Minister tony abbott had this to say about it. It is an absolute shambolic situation. It does look more like a garden cleanu