political infighting has seen japan with five different prime ministers in five years. witnesses report loud explosions in yemen near a presidential palace in sena. months of failed protests have failed to bring down the president. the deadly e. coli outbreak in europe has left more than a dozen dead and hundreds sick, mostly in germany. the source of the outbreak is not known. google said hackers have targeted g mamail users with a phishing scheme that may have begun in china. those are the headlines. i'm zain verjee in london. "world business today" starts right now. good afternoon, welcome to "world business today." i'm andrew stevens in hong kong. >> good morning for me, nina dos santos in london. japan's prime minister survives a no confidence vote but signals he'll step down after the earthquake aftermath is cleaned up. and hundreds of high-profile gmail accounts are breached after suspected chinese hackers go phishing. >> this guy is not the only trader who has had better days on wall street. the steepest u.s. stock slide in a year exposed fears of a stalling economy. the dow and the broader s&p posted their biggest loss since june of last year after a dismal job data, economic slowdown and a new downgrade in greece. that puts greece on par with cuba now. >> that downgrade to a caa-1 rating by moody's, something that perhaps you would expect from an impoverished developing nation but not one from a major eurozone partner. that greek downgrade is understandably weighing heavily on the european markets now. moody's also put the chances of a greek default at 50/50. the implications of that are enough to send chills right through the stock markets, well beyond european shares this is how things are look in the first hour or so of trading. heavy losses from frankfurt to london, cac 40 down about 1.35% at the moment. let's move on to currencies. not a huge amount of movement on that front. the euro has risen about a fifth of a percent against the dollar today. earlier on in the week it hit a three-week low against the u.s. currency on the back of these concerns. the dollar, one dollar buys you 1.4375 in terms of euros. 1.6335 is how the pound stands at the moment. should point out the dow lost more than a quarter of its gains for the year on wednesday that collapse in sentiment in the u.s. was enough to push the asian markets deep into the red this day. let's go to randy. >> investors lost a lot of money yesterday. the nikkei, let me bring that up, the nikkei fell about 1.7% to close at about 9555. this plunge came on the back of two developments. the first was that political one, prime minister kan's no confidence vote, which he did manage to survive. the second was poor sales of japanese oautos in may. hon in hong kong, the hang seng was down about 1.5% to close at 23,263. this is the left finish for the index in about four months it was led by a fall in oil shares. cnooc and petrochina, their shares fell about 2%. over in the mainland, looking at the shanghai composite, the index fell about 1.4% to close at 2705. looking at slower growth and manufacturing numbers, real estate curbs, and falling banking shares today. like the hang seng, today's close was the lowest in about four months. and australia, the asx 200 fell about 2.27% to 4600. this was led by mining giants, bhb billton and rio tinto. you can bet the major selloff across our region has investors nervous about where the week is going to end. if we get more bad data, maybe those unemployment numbers from the u.s. on friday, we could see another stock slide in asia. >> everybody will be watching those nonfarm payroll numbers. nina? >> let's show viewer house big a hit the u.s. markets took on wednesday. at the closing bell, traders were staring down losses of 2.2% for the dow jones industrial average. a report earlier dmin the day showed investors looking ahead pessimistically to the government jobs report out friday. the news just got worse as the day went on. with the u.s. manufacturing index falling and then we had that news that we've been telling you about throughout the course of the show, moody's downgrading greek debt by three notches to caa-1 pushing it further into junk territory. the nasdaq and s&p each lost about 2.3%. the bleak figures has sparked some bargain hunting. futures are looking up at the moment. this is how we stand in terms of the pre-market action. modest gains, but modest the operative word. you can seat nasdaq poised to open the day for the moment up by 0.10%. a weak start for the other two movements. >> i guess it's a relief just to see green arrows upcoming. the signs had been rather bright for the u.s. employment picture, which was due out on friday. economists were expecting at least 170,000 new private sector jobs to have been created in the past month. on wednesday, some of that optimism was extinguished by the payroll firm adp. its report suggested a total boost of 38,000 in private sector, less than a quarter of the predicted figure. fears of a slowdown in the u.s. recovery focusing on the end of q qe2, the bond bonanza. that was due to finish at the end of this month, but the slump may have arriveded earlier than expected. andrew sullivan has more on this. is it a case that we have been talking about a slowdown in the u.s.? has it or does it now look like it's much more severe than we thought? >> i think the worry with this jobs number is if they are not creating jobs, then, yes, the slowdown is not only more severe than we thought there will be more of it to come. the key thing here is that the u.s. investor drives the u.s. economy. and if the consumer, if there are not jobs there are not consumers. if there are not consumers, they're not buying goods from the rest of the world. >> and we've seen the slowdown in manufacturing numbers which would bear that out. just before we move out of the u.s., how does the end of qe2 play into all of this? >> it's one more uncertainty for the market. they said they will continue rolling over the money they already invested in this and trying to keep the interest low. but the worry is that interest rate also start growing. if that happens, that's going to stifle growth. >> we're talking about interest rates at the long end, the 30-year mortgages, things like that? >> they're trying to control the long end, but in doing that they're trying to control the short end if they can't control the long end, if people think inflation will come back in, they won't be able to keep the short-term rates low either. >> so all of this means people spending less? >> spending less, but also the general economy starts slowing down. the real worry is that it has not got going fast enough to afford to slowdown. they got their interest rates basically at zero. they can't put them further down. the real worry is we get a situation like we've had in japan over the past ten years occurring in the u.s. and that's worrying to investors. >> yesterday, one of our wall street reporters said they were talking to traders on the floor and they said there was no possibility of a double di-dip recessi recession. do you think there's a possibility of a double-dip recession? >> i think there is. the thing is it will slow down. now, adp's numbers can be wrong, obviously. people will be hoping that's the case. but it's an indicator. the market goes on indications. and that's what's worrying. the knee jerk reaction is that you take money off the table. >> which we have seen in asia today. talk us through your scenario now for the asian markets. >> the key thing for the asian markets is whilst the slowdown in the u.s. will hut them, it won't hurt them so badly, but this week we've seen slowing down in chinese manufacturing, a slowdown in indian manufacturing. those are two big markets. we had the sentiment out of china that they will try to create a better consumer within china. they're moving towards doing that, but it's a long process, and they also have their own internal problems, as we've seen, a lot of it still basically an agriculture economy. >> short-term outlook for asian markets? >> short-term outlook is probably the markets keep trading sideways, that we don't see growth. because most of these companies in asia run on cash, not credit, they're not hurt so badly. >> we won't see another big dip. >> i don't think so, i don't think we're going back to 18,000. >> andrew sullivan, thank you for coming in. nina? >> andrew, japan's prime minister in a due or die vote in parliament. coming up how naoto kan managed to survive a no confidence resolution. let me tell you about a very important phone call i made. when i got my medicare card, i realized i needed an aarp... medicare supplement insurance card, too. medicare is one of the great things about turning 65, but it doesn't cover everything. in fact, it only pays up to 80% of your part b expenses. if you're already on or eligible for medicare, call now to find out how an aarp... medicare supplement insurance plan, insured by unitedhealthcare insurance company, helps cover some of the medical expenses... not paid by medicare part b. that can save you from paying up to thousands of dollars... out of your own pocket. these are the only medicare supplement insurance plans... exclusively endorsed by aarp. when you call now, you'll get this free information kit... with all you need to enroll. put their trust in aarp medicare supplement insurance. plus you'll get this free guide to understanding medicare. the prices are competitive. i can keep my own doctor. and i don't need a referral to see a specialist. call now to get a free information kit. plus you'll get this free guide to understanding medicare. and the advantages don't end there. choose from a range of medicare supplement plans... that are all competitively priced. we have a plan for almost everyone, so you can find one that fits your needs and budget. with all medicare supplement plans, there are virtually no claim forms to fill out. plus you can keep your own doctor and hospital that accepts medicare. and best of all, these plans are... the only medicare supplement plans endorsed by aarp. when they told me these plans were endorsed by aarp... i had only one thing to say... sign me up. call the number on your screen now... and find out about an aarp medicare supplement insurance plan. you'll get this free information kit... and guide to understanding medicare, to help you choose the plan that's right for you. as with all medicare supplement plans, you can keep your own doctor and hospital that accepts medicare, get help paying for what medicare doesn't... and save up to thousands of dollars. call this toll-free number now. from cnn hong kong in london, this is "world business today." welcome back. a day of high political drama in japan. the prime minister has survived a no confidence vote, but he says he will step down after the nuclear crisis is over. his critics accused him of failed leadership. now the devastating earthquake and tsunami, the nuclear plant crisis that followed and the debt crisis gave naoto kan's opposition plenty of fuel, but he survived by a 2-1 margin. correspondent kyung lah has more on that. a day of high political drama. what happens now? >> reporter: what happen now is the patchwork. can prime minister kan try to get his political party, what's left of it, back together, sew the pieces together and try to get some work done. the prime minister has said i will step down, but let me try to do something here. let pe me try to fix the disast with the nuclear problems and fukushima. he wants to try to make some progress. progress is difficult with japanese politics. this is the sort of political hi highjinx that has upset people in japan. in the tsunami zone, we heard voices throughout the day popping up in the japanese media saying why are you doing this now? isn't now the time to have political movement forward and trying to get real progress done? that's the word here. is the political party going to be able to patch itself up and get some work done on behalf of the people. >> are you saying this appears to be more political maneuvering, an actual effort by the japanese leaders to sort out their problems? >> it's a little multi-layered. prime minister kan early on in the disaster was seen as a -- you know, stepping forward trying to take some political steps, trying to take some unifying steps. but it largely was seen as not being strong enough. but that's partially because of the way the japanese parliamentary system is set up. that it's very difficult to make decisive, strong moves within this system. so that strong leadership that the country needed in the wake of these massive disasters wasn't really there. so that's where the criticism is stemming from. if you look at who is making this criticism, it's coming from the opposition party. a party that held on to power before the dpj came to power recently for almost 50 continuous years. i read many things in the japanese press about the sharks smelling the blood in the water. that the prime minister is viewed as being weak. he was weak before the disasters, his popularity continues to be low, and they thought this was the time now. the question is is all this going to backfire on the politicians? will people continue to be disgusted with japanese politics? is there going to be votes who are disenfranchised, especially in the region that needs political leadership and the work to be done if they're going to continue to be a loud voice asking what have you done for me? >> just very quickly, five prime ministers in japan in five years. is there an obvious number six out there? >> absolutely not. if you talk to people here in japan, they scratch their heads and say who wants this job? you can't even put your name in ink anywhere anymore in japan. it's so easily erased. if naoto kan stays on the job until next thursday, a week from now, he will be the longest-serving prime minister out of those five you're talking about. it is a revolving door it is a continuous problem. if we look at the long-term lingering economic policies that have led to 20 years plus of economic stagnation, these are significant problems that need strong leadership and consistent leadership and that's certainly just not the case. >> kyung, thank you very much for your analysis on that. kyung lah live from tokyo. nina? a >> andrews, after the break, world football's governing body has been battered by haven't allegations of corruption, but that didn't stop it from re-electing its president for a fourth time. will he pull fifa out of its troubles? the pollen outside. but with 24-hour zyrtec®, i get prescription strength relief from my allergy symptoms. it's the brand allergists recommend most. ♪ lilly and i are back on the road again, where we belong. with zyrtec® i can love the air®. [ male announcer ] get up to $6 in savings on zyrtec® products at zyrtectv.com. welcome back. after months of allegations of corruption involving officials of football's world governing body, you'd think the man at the top might be tempted to hang up his boots, but you'd be wrong. sepp blatter emerged from wednesday's presidential election unscathed and is promising to transform fifa in the next four years to come. >> thank you very much. fifa president sepp blatter said he expected football's world governing body to reunite after his unopposed re-election in zurich. the 75-year-old announced fifa could clean up its act and be more transparent after months of corruption allegations and he dismissed allegations that the main sponsors would pull away. coca-cola and adidas expressed concern around fifa and said there must be reform and blatter said leave it to him. >> we've had contact with the sponsors, and specifically through our marketing division and secretary-general and myself was in contact with two of the main sponsors in fifa, and they told us we trust you, but please bring back this fifa or this boat of fifa in better waters. >> reporter: the waters have been so choppy that the english fa proposed to delay the votes for other candidates to challenge blatter and give voters a choice. but 172 of 206 delegates opted against the proposal. so blatter gets the fourth and final term as fifa president. the swiss, who has said he would not run again in 2015, was first elected in 1998. under his watch fifa has become the richest sports body in the world with cash reserves of a cool $1.3 billion. that's it for me. back to you. >> you are watching "world business today." still ahead, politicians in washington play russian roulette with meamerica's credit rating. from cnn hong kong in london, you're watching "world business today." wall street's biggest selloff in months has trigger adam ed a domino effect in the rest of the world markets. lower than expected job creation, lower than expect d e credit ratings, and lowering of the greek debt. about 90 minutes into today's trading session, and boy is it a sea of red, as you can see. there currently down by 1.3% for some of these markets, such as the cac 40. andrew? pretty much the same picture here, nina, if you look around the region. the u.s. jobs numbers which came out last night raising fears about the exports from this part of the world and the general global economic slowdown. a lot of people saying the slowdown in the u.s. may be now sharper than had earlier been thought. the electronics companies and the japanese automakers are among the stocks to be taking a big hit as the nikkei was down 1.7. the political uncertainty in japan did not help. hong kong down 1.5%. shanghai down 1.5%. australia down 2.25%. the big miners leading the way down in sydney. nina? >> let's hone in specifically on wall street as we are just seeing a triple whammy of bad news which sent stocks spiraling on friday. here's a recap of exactly what went wrong. >> reporter: another wave of weak u.s. economic data hit wall street hard and stocks sold off sharply. at the close the dow plunged 279 points. the biggest one-day point loss for the blue chips. the nasdaq dropped 66, or 2.3%. and the s&p 500 suffered big losses as well. setting the negative tone, adp said the u.s. private sector created just 38,000 jobs in may. analysts were expecting a gain of about 170,000. the adp report is often seen as a preview of monthly jobs numbers, and some analyst lowered their estimate force friday. a slowdown in manufacturing activity put more pressure on stocks. the manufacturing index grew at a much slower pace in may than april. the slow june was caused by sharp declines in new orders which indicates sluggish consumer and business spending. u.s. automobile sales also slowed in may. higher prices and lower incentives cut into demand, while the aftermath of the march earthquake in japan put japanese models in short supply. one bright spot was in sales of fuel efficient models like the cruze and the ford focus, that's no surprise considering gas prices. coming up on thursday, investors will look at the latest weekly jobless claim numbers, analysts are looking for a slight improvement but claims are to remain above the critical 400,000 level. it seems as though there's been a bit of bargain hunting in new york ahead of the start of today's trading session. just a short time ago, features were looking up, they're still up but by modest amounts. the nasdaq leading the way up by about 0.10%. andrew? the other big story in the u.s. at the moment is the political posturing over the country's debt limit. as lisa siylvester explains f lawmakers don't raise the debt limit by august 2nd, america is at risk of defaulting on bond payments. >> reporter: if the debt ceiling is not raised t could have a catastrophic effect on main street. the treasury department lays out a frightening scenario. as we near the beginning of august, interest rat