Worldwide exchange starts now. Good morning and welcome to a very special presentation. Im sarai eisen reporting from london. Good morning live in brussels where european leaders are set to meet for a usually submit following last weeks brexit vote. Much more on that, but first lets check in on Global Markets this morning. Some signs of sablization really for the First Time Since the brexit vote. S p futurings pointing higher. Dow up 136. So something compared to the losses the stocks had seen over the last two days. More than 800 points, but clearly a little rally going on. Nasdaq up 32. As for the u. S. Dollar, currencies in the center of the storm, the british pound gets some much immediated relief. 133. Up by a little more than half percent. The euro gets a boost and the japanese yen. Reversal of those safe haven and flight to safety that weve seen. Also want to point out the chinese yaun. As for the tenure treasury, no yield. Less demand for the save haven assets. Pushing yields higher, but boy are they still low on a historical access. Theres some green on the screens. German dax up. Ftse 100. G. Italy getting the biggest boost of all. As for the overnight in asia. Nikkei ending flat. Hang seng closing out. As for the price of commodities lets show the price of oil. Reversing, 2 gain. Nearly up 2 as well. Closzing above 48 a barrel and gold which has sored with fears of the brexit. Giving some back, ten bucks down about three quarters of one percent. Potentially a bounce here after what has been some heavy selling in the past two sessions. Nothing has changed and still some serious questions longterm, short term, what this is all going to mean for the brita british and Global Economy, not to mention a deepening crisis in this country. Certainly right. Thats a point to dwell on. Deeping crisis in the united kingdom. If we look at the market moves the most pronounced was in sterling. We didnt see quite the level as we had seen on friday. That was a response to development over the weekend. Frankly is a shambles in the moment on both sides of the political aisle. Thats where we saw uk assets in much more pronounced fashion sell off yesterday. Either way, as you correctly point out, great rally today. Not much compared to the declines weve seen. Some kind of relief rally as opposed to some fundamentals improving, wouldnt you say. Absolutely. Youre there for this european leader submit where i know David Cameron will be. Not a lot gets done at these meetings. Theyre usually a discussion. We will be watching for any commentary on the sidelines. Sound bites. Who will you be listening for. Absolutely right. I dont know if we expect outright action. Its going to be fascinating to see the reception that Prime Minister david come ron gets when he arrives here. Today, tuesday, hes part of this European Council meeting with all 28 european leaders. Tomorrow hes being booted out so the other 27 leaders can finalize the plans without him. I think the main thing to point out the developments of the last 24 or 48 hours. Most european leaders have come out and accepted the fact its up to the uk when to invoke article 150. There will be no stock negotiations. No back door amicable until article 50 is envoinvoked. They can start to get the feelers out, what might be possible, what might not be possible before they set that twoyear time clock. If thats not possible, thats not really much point in delaying. I think we found a middle ground. The european leaders agree they cant force the uk to invoke it, but not really much point delaying much beyond when the new Prime Minister is in place. We learned that would be by the second of september, sara. Its going to be an awkward dinner conversation tonight in brussels with David Cameron and his foellow leaders. The british government. The uk treasury has planned to reduce the exposure to the banks it took over during the financial crisis. To funds managers and discounted offer to the public. Saying nose sales are now on hold until next year. Speaking on banks. Rome could step in to shield lenders from any brexit fallout. Selling off sharply in the referendum. Going the other way today. While rome is eyeing an capital injection for the banks, there are rules to promotionally block that move except in certain circumstances. Investors are optimistic. Mario draghi also speaking this morning. Draghi saying sadness is the best word to describe the brexit vote though he didnt mention the actual brexit in the speech. Instead, draghi stressed the importance of an alignment of global policy. Have a look. We have to think not just about whether or domestic monetary policies are appropriate, but whether they are properly aligned across jurisdictions. We have to think not just about the composition of policies within our jurisdictions, but about the global composition that can maximize the effects so our respected mandates can best be delivered without over burdening further monetary without overle burdening further Monetary Policy and so as to limit any destabilizing spillovers. Clearly with the financial turmoil, there is an effort here particularly from the European Central bank and bank of england, mark carny to try and reassure the markets. Emphasize calm and stability. When you talk about political con tay gent, i know youre going to be watching the leaders around you to see how they react, but it really is mario draghi that is the safe guard of the euro because what they share is the European Central bank. You remember during the depth of the crisis when he said whatever it takes, thats when the euro turned around and the fears of the euro brooki inbreaking up c absolutely right. What you point out there the Central Bank Backstop that euro has is of course the uk completely sovereign and has the bank of england. Contingency plans are in place. I would point out the selling weve seen in the pound, it hasnt ever led down. Theres been buying liquidity at every level. That will be slightly reassuring. The way it has fallen relatively reassuring. Were not expecting any immediate significant intervention from mark carny. You mentioned of course possibly action from various countries. The biggest weve seen so far is italy to help support the banks which have sold off sharply. Partly why theyre rallying today. In terms of the leaders most upset with David Cameron. Hes already had to step to the plate and deliver some kind of stimstimulus in the markets. Well have to watch that as it goes on. Lets discuss a little bit more what the implications are for the rest of europe. Im joined now by alex. Hes the ft brussels editor and alex, lets just quickly touch on this. Weve been in the middle of a discussion. Which countries around europe are the most under threat from con tay general. If youre looking immediate yam. Series pressure. You are saying he has had to launch the kind of rescue that italy has been resisting for five years in the wake of this its a chance to try and clean up the banks. Certainly in the pliolitical terms. You could see in netherlands, denmark, france, countrying where there are pressures for a new kind of antiestablishment mood is taking old and pressures for referendum and the kind of proeu Political Class is going to come. For my next question i want to give you the full sbrx you deserve. This is of course alex. Hes the financial chief. All eyes on this brexit bust today. Have we now moved on from perhaps rhetoric we saw on friday in the mind of european leaders it is totally up to the uk when they invoke article 50. There is certainly impatience on the part of the 27. And what youll hear tonight probably is a message to David Cameron that whoever his successor is that they can accept that britain needs to take time. Whoever that is they want to send him a message to say we will not allow yo to drag this out. We will not allow a secret negotiation to take place before you say i want to leave the union and start a formal divorce process that gives them all the cards in terms of the power. So theres no real benefit now for the uk to delay it much beyond picking a new Prime Minister. The advice to the new Prime Minister might be actually to trigger this. Puts you in its to your disadvantage. You probably will still have some meetings with merkel and ren si and say no informal talks. They want the new Prime Minister and lay down their own terms. I expect youll see a Prime Minister before the trigger is pulled. Who do the brussels leaders blame for all of this . The british people . David cameron had a lot of meetings through his renegotiations to have a new sediment. I think he showed a degree of confidence, especially when he first invoked the referendum and raised the idea that we could win this and to settle this matter in britain for a long time. They were skeptical eu leaders around the table who thought referendum rs always a bit of a gamble. Cant tell how the politics will run. Its going to be a very uncomfortable moment. Surely on the flip side some blame to be apportioned to the eu. They certainly feel like they went quite far in that deal that they pushed the law to its limits. That they actually made sacrifices at national level. They probably didnt expect to do at the beginning of negotiations. Sure. And looking back, would they have given more . Perhaps. Perhaps a bit more, but they also saw a Referendum Campaign where the concessions, the european end of the new settlement didnt really figure much so they thought we went to a lot of effort, the eu kind of stood still for almost nine months while that uk negotiation was taking place. Alex thanks so much. The bureau chief for the financial tames here in brussels and, certainly, the atmosphere here when David Cameron arrive ss going to be interesting indeed. Im glad youre going to be there for it. When we come back, we are live in brussels and london. What damage plans are actually in the works and what will it mean for Monetary Policy. Well ask michael purves. Well be right back. And a parade rained on the sales teams parade. And they still made the meeting, without actually going to the meeting. Before any of this, cdw orchestrated a mobility solution, using the hp elite x2 1012 with intel core m vpro processors. Mobility by hp. Orchestration by cdw. Im sara eisen reporting live from london today. European leaders are gathering for a key submit. David cameron will be there later. Take a look at the vix which measures volatility. At one point yesterday, the index hit the highest level since back in february. Our next guest says to keep an eye on the levels as a chi indicator for when it may be time to Start Playing offense again. Joining us to explain that call from new york is michael purves. Good morning, michael. What were seeing is some relief after some rocky days. How do we know whether its the early signs of a more pronounced period of stability for markets. Well, i think you can look at a few different factors there. The relief were seeing across risk assets is nothing than oversold conditions. You see these type of relief rallies all the time. Lets not forget, were entering day three of a historic event here which is very complicated and very opaque pathways, but the signals i would be looking for, you know, in terms of when we can really start thinking about playing offense would be one, you know, are uk bank stocks, are they really starting to put a bottom in. I dont think thats going to happen any time in the immediate future. Obviously the pound and finally here in the united states, looking at the shape of the vix curve. Its gone inverted. If it starts to reinvert into a more upwardly sloping formation, thats all a very good symbol. Not something lyme loim lookinn the immediate future. Certainly a Game Changing event. Does it change your mind longterm about the outlook for u. S. Stocks and the u. S. Economy. Yes. The vix really and u. S. Equities really had not been pricing in this. All the assets not to price in brexit. I think the u. S. Equities were the most sort of offsides in this. Just minutes before the close on thursday, the new york close on thursday, you could have bought s p at 17 balls which is just really, really cheap. Given how important this event is. The vix has climbed. The volatility for u. S. Equities has shifted for some time. I think its going to stay there. Too many longterm implications. For starters, were going to have a much stronger dollar than weve been used to in the last couple of months leading into the prebrexit rally. Very quickly, is the upshot here to go to cash . What are you telling investors . I think right now i would be certainly looking at long volatility trades if youre using options. If youre not using options, certainly primming your exposures and playing things very defensively and be careful with the most dollar sensitive stocks, materials, energy names come to mind right now. Caution is the word. Thank you, michael purves. When we come back, an epic upset. Iceland stunning england in the euros. Plus, even wimbledon is not immune from the brexit turnout. Tell you why the briprize money just got chopped. Sara and will fred, we have a front, this front is making a huge difference as it moves through the midwest. Temperatures dropping off chicago. The due point is dropping. That means the humidity is dropping. Its going to feel nice and refreshing. Before that front gets through the northeast. Weve got thurnderstorms. After that lowere going to continue to see some popup showers and storms possible there. Especially here in the high planinei plains. Meanwhile temperature wise got a lot of heat. A lot of heat and humidity across the country down to the southern plains. It will be cooler and much more refreshing. Thats your cost to coast forecast. World wild exchange continues after this. Worldwide exchange. Contagion. Welcome back. This next story is a bit of a punishment to even include it because im certainly hurting from the story. For the second time in less than a week, england is shakened by an exit from europe. This time coming on the somer pitch. Iceland knocking the three lines 21 in the round of championships. Its the first time iceland has qualified for the euros. After the match game, resigned calling the loss not acceptable. Eliminated at the group stage in 2014. So another exit for england from europe and another major resignation off the back of it. I can only say im pleased i was traveling out here to brussels and i didnt have to watch the match which was very disappoints. You can imagine how iceland fans were trolling england after that. Big tournament of tennis begins. Were talking about wimbledon. Not even strawberries and cream. Safe from brexit. At the worlds oldest tennis tournament the prize money is shrinking by the day. Its paid out in pounds. Last thursday that would equal 3 million, but then britain shocked the world by shoeting to leave europe and the pound lost 12 of its value in two days and that shaved 360,000 off the top prize. It could get worse if the pound continues to sink over the next two weeks which is how long the tournament goes. We went out to wimbledonont fe the biggest stars. I do think its a shame. Everything is going to be impacted. I wouldnt say id feel sorry for djokovic if its him. Hes got plenty of hundred. He did dodge reporters as his country men voted overwhelmingly to stay in europe and lost. Generally speaking of course leading sportsman and actors did keep their head down. Beckham came out. I wonder if they could have shifted the result. Its too late. Still to come on Worldwide Exchange, what to expect when David Cameron arrives here in brussels. As we go to break, lets have a look at how European Equity rs trading this morning. A little bit of a relief rally after a torrid couple of days. Worldwide exchange is back after a couple of minutes. Good morning. The brexit battle bus heads to brussels. European leaders convene to answer the question on everyones mind. What happens next . Markets now european stocks bouncing back. The pound krouling off ilts low and u. S. Equity futures are pointing to a higher open on wall street. Its tuesday, june 28, 2016 and youre watching Worldwide Exchange on cnbc. Good morning and welcome back. Im sara eisen live today in london for you just across the river from parliament. And i am will frost live in brussels where eu leaders are society to meet. Some relief across the board, steadying after the storm. U. S. Equity futures pointing higher dow futures up 140. Nasdaq futures up 30. If it holds this would be the first day of gains for u. S. Stocks after the brexit vote that shocked the world. Some relief also for treasury yields. Yields around 1. 46. The british pound getting some relief. Down 12 in two days. Thats a record amount. Now were seeing about 6 10s of a percent. Even that save haven yen is weaker today. Lets show you the earlier action in europe. Also looking strong here after a rough few days. The german dax up 2 . The banks are leading that charge on some signals that may be some relief. More on that in the moment, but the foot tse broader look and i been battered is higher today. Overnight in asia saw signs of stability. The nikkei. The price of oil this morning. Lets show youwti and rent right now. Off the session highs. Wti nicely above. Brent blow. Gold quickly which has been very much in demand on the flight to safety is giving some back down. Little less than ten bucks or three quarters of one . Yes, indeed. All the attention turns to brussels today. The European Parliament is in session at the moment. Were here in the European Council meeting. Will turn to the European Commission as european leaders start to arrive and particularly the reception of David Cameron will get on arrival. Earlier today the president of the European Parliament, had this to say. It is important that here in the parliament in the location of european democracy we turn