Placed under investigation. Jamie dimon says he will continue his work at the bank after being diagnosed with throat cancer. Announcer youre watching Worldwide Exchange, bringing you Business News from around the globe. Warm welcome to todays edition of Worldwide Exchange. On todays show, under pressure, s p has warned argentina it could get a default rating if it doesnt pay its half a billion Interest Payment within the next 28 days. Well be discussing later on in the show. The u. S. May have been knocked out, but tech giant google is still looking to win big inside the world cup. We take a look inside googles board room. And finally, 200 protectors are arrested in hong kong as pro democracy demonstrations break new records. All that and more coming up on Worldwide Exchange. Well, as i was saying just then, a bit of consolidation right now in the European Equity markets. We see the stoxx europe 600 up and we saw gains 0. 7 to 0. 8 yesterday. That was more pmi data. It was the u. S. Session that gained towards the european trading session. Right now, 0. 2 gains. Were seeing the french session under pressure. It is the telco stocks weighing on the market right now. Well bring you up to speed with those stories in particular. The first one is whats going on in orange french telco stocks. Down around 3 after announcing it has ditched plans to take part in the french telecoms market. It said right now conditions just arent right. Orange, bouygues and iliad are going to try to bring to the talks right now. Down across 3 and 4 across the board. On the top side, Alcatel Lucent which says this morning after jpmorgan raised its rating on the stock from neutral to overweight. Taking a look at the Foreign Exchange markets this morning, muted reaction from the data. Remember the new orders rose in that data. Also the employment hounding the level. I wonder whether the Inflation Department being more muted reinforced yellens message longer. Right now, weve got euro dollar consolidating. The momentum seems to be towards the top side but, of course, the risk as draghi leads on strength into the trading session. Point out sterling, also, 17150 the level. It seems that we do have construction and services pmi tomorrow. Unlike europe, the Asian Session taking their cue from what we saw on wall street earlier. Sri. Thats right, julia. Risk appetite alive and kicking here in this region. The asci asia index ex japan at a threeyear high. Speaking of japan, though, equities markets over there are coming off the highs. The nikkei as a guide. So were still looking fairley elevated, coming off the fivemonth highs for the nikkei. Let me talk about one of the outperformers here, the indian market, the s p sensex, up over 1 . It is going to be one of fiscal discipline and fiscal consolidation. Theyre reaching this conclusion but the finance minister has been talking about mindless populism and policy making needs to be checked. And that stokes expectations of a pragmatic budget on july the 10th. But really whether these gains can be sustained, julia, you and i know it all boils down to the barr payroll. If they do beat expectations by a sizable margin, many economists are telling us perhaps we could see the market retrace, it could collect lower on the fears that the fed could hasten the normalization process, so less prospect of easy liquidity on the market could upset the markets and could be equities negative for Global Financial markets, including equities over here. So a lot riding on the payrolls, julia. Back to you now. Okay, sri, back to this idea that good news is bad news perhaps. Well catch up with you later on. Jeffrey joins us in the studio. Whats the risk that a strong payroll number knocks a bit of optimism here . Well, the question is how much is it going to be from u. S. Treasuries, the yields, and how much is that going to flow into volatility . Note chairman yellen has former Monetary Policy perhaps she would like to talk about volatility in a more another topic right now because its what central bankers are starting to concern themselves on and without the injection, i cant see anything moving at this point. Were seeing fx put on the carry trade and thats it. Is that the sense of caution right now as they look at the equity markets . Yes, theyre making fresh highs, volatilities low, volumes are pretty anemic right now. Is some of the question were seeing in the equity markets feeding into the f xw market right now . I think thats feeding into every single asset class right now. You put on the position carry, follow equities, but at the same time, any residual cash you have you probably want to put into equities ahead. That perpetuates itself. Then eats going below 250 or maybe its a signal the fed is going to be lower for longer. What choice do you have but to just go long risk again. . I just want to know about the ism manufacturing yesterday. If you look at the inflation components, its pretty muted. Do you think thats something investers pulled out to reinforce yellens message . Right now, lower is Going Forward. I think they are still converging to the view that the fed is going to grasp any low expectations print and stick with that because youre not going to see them in the scales in any way. The only central banker weve seen try to do that is mark carney here. Hes trying to inject some volatility. How volumes and mortgage approvals, maybe theres going to be caution there, too. Yellen is going to stick to the script, surely, and the message from the imf most recently has been, look, this is a situation right thou. If we look at the employment situation, if we look at the inflation situation even now, the hold even longer than the market is pricing right now. I think so. They are really just very, very tightly sticking to the vehicle of the economy and it can be improved, youre not seeing inflation pressures coming anytime soon. Some are asking about oil, is that going to be an issue . Id say outside of japan, the monetary authorities are going to say look, its transitory, were going to dismisses that for now. Well watch wage growth. As long as wage growth doesnt come through anywhere, theres no reason to tighten. Seeing the risk carry trade and if you look at china in the last 24 hours in particular, the geopolitical risk we seem to be putting that side in particular, do you expect the rally continue . As much as i hate to say it because it goes against our core views for a stronger dollar and more volatility, that looks to be the case. I look at all the performance this week clearly people put on risk and it seems like theres no other choice. I dont like it, but i have to. How do we trade this . Right now, i would say relative value. If youre long aussie, youre short kiwi. If you want to be long scandinavian currencies, for example, i would go for the shortterm and maybe go for norway over sweden. Theyve been a bit of a thriller already. You have to go with sterling right now because theyre the only central banker moving ahead. But i do advice short u. S. sterling. Positioning in short . Positioning in short u. S. sterling is crowded. Jeffrey. If you really are long dollar yen, thats what the positioning is vouning. Great to talk to you this morning. Now, the uk without europe would be a catastrophe. Thats the line from wolfgang shoibler. His comments come as David Cameron tries to rebuild relationships with the newly elected president of the European Commission which the uk tried to block the role of. Annette is in frankfurt. Is the minister willing to give david concessions Going Forward . That actually was my question yesterday because i think that must be key to a piecen in the best interest of the united kingdom. That is why when i said that the uk is not europe, so dont ask me what the uk is without europe. Not a lot. It could be a catastrophe, even more for the uk than for europe. This is a concern for european leaders. Its a point that growth is stubbornly low. Germany is not deciding the g7 group for the remainder of this year and next year. They have chosen, as the off ruling topic, sustainable growth. And i was asking him, as well, what he means to do to actually spur growth in the eurozone. Have a listen. Translator the deciding factor is that we need more investment for more growth in europe. That is the key point. We do know necessarily need the investments made by governments, but even more important are private investments. And for private investments, investor, but consumers need to have trust as private consumption is vital for a growing economy and thus for investment. A nonsustainbility budget policy is thus very harmful to these connections. That is why the interest of the ecb are not the solution. They are, if so, solutions to accommodate. Solutions need to come from political decisions, implementation, structural reform, again and again. That is key. So while sitting through their austerity track focusing on discipline, one would argue that there is a share of wolfgang schoibler towards supporting domestic consumption. He was confident that in germany consumption will add to Economic Growth and not just exports. Bottom line is that he and the german government, the ecb might go down the path of further additional easing because he thinks that that is actually creating bubbles, which we are already seeing here in germany when it comes to the real estate market. Julia, back to you. Annette, thanks so much. Great work. Now we have the take a quick break, but cat bonds are making a comeback. After the break, well be asking whether the investment is a purrfect investment or whether its running out of lives. Yes, please come back after the break. Shares in uk mother and baby retailer mothercare announced it rejected two bid proposals for rivals destination maternity after the Company Issued a profit warning at the beginning of the year which september shares tumbling. Their most recent proposal comprise 230 pence in cash as well as shares in the new Holding Company which has been listed in the u. S. Mothercare has so far refused to he gauge. Mothercare has been forced to close stores in its main uk market amid fears of online establishments. Nationwide, house prices were up 12 on the year by continuing sales in london. However, the ceo of home builder persimm persimmon told cnbc earlier the real numbers are misleading. We would estimate so far this year weve seen about 1 increase. I think its certainly a very millionble level outside of london. Jpmorgans Ceo Jamie Dimon has been diagnosed with throat cancer. The 58yearold says its curable. His doctors caught it early and theres no evidence it spread elsewhere in his body. Dimon will undergoing chemotherapy and radiation that is expected to last about eight weeks. He plans to remain actively involved in daytoday operations. Sources tell Cnbc Jpmorgan has a short, medium and longterm Succession Plan in place. Check on jpmorgan shares this morning, up by 0. 2 . Pfidelity is telling client outside the u. S. They will no longer be able to trade and Exchange Mutual funds after january 1st. It will affect less than 0. 3 of fidelitys 20 million accounts or about 60,000 members. Its been over two decades since the market for catastrophe bond estimates in the 1990s. Last week, the World Bank Issued its first cap bond, a 50 million bond to 16 caribbean island nations. The chairman of 12 capital is joining us. Lets start by talking about bonds first. Record levels of issuance so far this year, i believe. Talk us through the benefits of these potential investors. The lack of correlation among the broader market. Yes, exactly. The main benefit is the fact that these cat bonds are un correla correlated, such as equities or Interest Rates or corporate bonds. The Main Investors in the Capital Markets are Pension Funds. European Pension Funds. But more the u. S. Pension fund. And then yeah. Thats the main benefit of cat bonds. The likes of hedge funds to more Mainstream Investors right now. Is that right . Yeah, thats right. Its really a shift from the hedge funds prior to the Financial Markets to the Pension Funds. Typically Pension Funds are among 3 in this asset class below 1 . We havent seen that much because it would make sense. Its investment below 1 and 3 is always top. Weve seen it come down 3 . Thats the risk particularly given talking about Pension Funds and more ordinary bonds, whether theres an acceptable appreciation of the risks here. No. I think the spread in fixed income market. Those in corporate bonds, its pretty much similar. So its nothing unusual, what receive seen in the cat bond markets. Even with the spreads coming in, i appreciate it happening more broadly across the space, but still an appreciation of the risk. No. The risks are still the same. The risk of an earthquake enough of an appreciation of the risk for investors that were talking about right now. Do you believe that they actually are investing in the tools that they understand well enough . Most of the investors with, who specialize in investment management, theyre not doing this themselves. So there are no Pension Funds out there. They go to Companies Like us who specialize investors to understand the risks, and they allocate to the categories within this asset class. Its interesting. I looked at some report about hurricane sandy. 17 billion worth of damage on the u. S. East coast in 2012. Because cat bonds are typically that much higher in the risk. 17 billion is not sfusht to take the cat bonds. Cat bonds are really to attach in 50 years. There are cat bonds out there that attach 11 100 years. These are the types of events. In terms of the size of catastrophe banking, can you give us an idea what were talking about . Hurricane billion would basically lead to some loss in the cat bond market, not big losses, but some of them. Were talking about something bigger than Hurricane Katrina to lead to significant loss in cat bonds. Theres talking down or perhaps in some ways to stem these products. But youre in direct competition, arent you . Yes, of course. What the cat bond market is doing, the cat bond market is part of the ls market. So its a smaller part. Another 25 billion, they basically take away the most predictable reasons and the nat cap business is the highest margin. Its the competition for the Insurance Companies. More Insurance Companies are in cat bonds. Very quickly, we came into this talking about bond issues. Is there some concern that investors are looking at the price of these and secondguessing right now how much value theyre getting . Yes, exactly. We believe it has come to an end, the floor, and it will be difficult to lower coupons at the moment. Great to chat with you this morning. Now, former french president Nicolas Sarkozy is accused of offering a judge a top job in exchange for more information in a case that has since been dropped. Sarkozy was questioned yesterday and has now been released pending further investments. The case is likely to take months to review. Stephane is in paris to give us the latest. He may be under reform or review right now, but that doesnt interfere with the plans to launch a campaign bid for the president ial elections . Legally, no. But it could seriously impact his reputation and his nature. Because that, of course, has not been officially announced by the former he approximated, being placed under formal investigation is only a step in the legal procedure. That being said, its a step and a very, very serious state, placing someone under formal investigation means that there are some serious or consistent evidences pointing to, one, a possible implication in a crime, thats the definition. The magistrate is expecting not only Nicolas Sarkozy but his lawyer. If found guilty, sarkozy faces up to ten years in jail and a maximum fine of 500,000 euros. Thats obviously extremely heavy and would be a major blow to Nicolas Sarkozy. Its not the only problem for sarkozy. There are now six legal cases, including this one, hanging over him. So if he wants to run for reelection in less than three years, the road will be full of obstacles, julia. Thanks very much, stephane. Well have to wait and see on that one. Now, could it be the worlds most expensive bed . Takessy emmonss controversial piece of art my bed sold in london last night for 2. 2 Million Pounds. Thats ridiculous. The r the installation features an unmade bed surrounded by cigarette butts, clothing and it represents a time in her life after she suffered a breakdown. Has the buyer invested in a constitutional piece of art or is this beyond any level of justification or is it just an example of the rational exuberance right now in the market . Get in touch with us by email, by twitter cnbcwex or tweet me directly. I want to hear from you. Tell us your thoughts now. Coming up on Worldwide Exchange, google moves to the beat. The fx giant snaps up songa. Details after the break. Consolidation in wall street markets offer top gains. Investors keeping their eyes on the private sector numbers due later. Orange called time on its takeover bid for bouygues. Former french president Nicolas Sarkozy is placed under formal investigation as being detained for questioning. And jam