the latest shooting was on monday when three children and a teenager were kill at a nearby jewish school. police say negotiations are still under way with the suspect in this hour's long standoff. diana magnay joins us from toulouse with the latest. this standoff has been going on for three hours now at the very least. is there a sense they're making any headway? >> reporter: well, we've just heard from the mayor, actually, who's been talking to police right outside the house, just up the road from this residential neighborhood, just a few kilometers from that jewish school. the suspect, the 24-year-old man, holed up in that house is extremely stubborn and determined. he's talking to negotiators but he is by no means in negotiations with them. the man said that it is likely to go on for quite a long time. we are beginning to get more and more details about this man. we know he is 24 years old, a french national of algerian origin. he spent considerable amount of time apparently in afghanistan and pakistan and he belongs to a jihadist group which translates as the knights of glory, which makes a little more sense as to why he should have attacked those soldiers and killed three soldiers last week. they had served in afghanistan. we heard from the interior minister that he attacked that school for revenge. we also know that he's been in close contact with the frex president for the duration of this raid. which is still ongoing. there has been exchange of heavy gunfire earlier on in which two police officers were killed, one of them in the hospital, having an operation currently on his knee. >> is the focus on one suspect only or are there others? >> reporter: well, it would appear as though the investigators believe that this man is the man they're after. we know also that his brother was in the house with him and his brother was handed himself over a couple hours ago to police. what he said to them in the meantime we don't know. but it would seem at this stage, this is obviously a flawed situation, that the man they are looking for, the man supposedly the one who carried out all three attacks in the toulouse area in the last ten days is the man still holed up in that house that police are trying to negotiate with. >> diana, thank you for that. she's reporting from toulouse. we understand that there are 300 policemen in the area and roughly 50 policemen in front of the house at the immediate scene. in the meantime, funerals for some of the pictuvictims of mon attack are being held in jerusalem. the bodies were flown into the country early on thursday. the french foreign minister is at the service alongside families of the victims and leaders of france's jewish commune. those are live pictures that you're seeing there from jerusalem. that is the latest information we have on police raid in toulouse, france, seeking suspects in the killings at a jewish school there last week. i'm monita rajpal. do stay with cnn. we'll bring you any updates as we get them. for now, "world business today" starts right now. good morning, from cnn london, i'm nina dos santos. >> and good afternoon from cnn hong kong, i'm andrew stevens. you're watching "world business today." the top stories this wednesday, march 21st, more countries cut back on iranian oil as the u.s. sanctions. investors are asking themselves as the chancellor prepares to present his budget today. and betting big on big city voters. how mitt romney's strategy paid off in illinois. first up, though, let's take a look at how the european stock markets have just opened in the first four or five minutes of trade. we're poised for a third day of steep declines after yesterday and the day before's sessions which saw the markets fall by an equal amount. take a look at the cac 40, that one down to 1.25%, these markets have rebounded just a little bit. they might have started out on a downbeat note, but as you con see at the moment they seem to have rebounded in we focus in in particular on the ftse 100, this will be one of the markets people will be looking at closely throughout the day today, andrew. we knew inflation according to the latest set of figures showed that inflation has started to come down now to about 3.6%. but we've got the budget going on today and all eyes will be firmly fixed on how the chancellor of the uk's finance minister manages to balance the books and stave off a ratings downgrade by people like fitch and moody's that have tabled a number of warnings for this country so far. andrew? the joys of technology. this is the picture here in hong kong. as you see, those, these red arrows are for people. china's growth is slowing and the world, the investment community seems to be taking a more and more negative view on how fast growth is slowing in china. at the moment it's slowing faster than most people would like. the only market that finished up was in fact shanghai. it came down in the morning session, down to a one-month low but popped in the afternoon trade. energy companies suffering pretty much around the region as oil prices fell. in japan, you'll see the nikkei off by 0.5%. exporters reacting to a poor trading day in europe yesterday. sony down by 4.5%. been a volatile stock of late, sony. nina? >> andrew, stocks have been up and down over the recent weeks. crude oil has been going basically in one single direction and that is north. thanks to ongoing concerns about sanctions on iran as you can see, prices today, though, leveling off a little bit on the back of news that saudi arabia and libya are now starting to help fill the gap in the market that's been left by sanctions on iranian crude. brent crude for may delivery is currently trading down a little as you can see, just shy of $125 a barrel. currently trading at 124.22 at the moment. that's down by $1.30 on the barrel. remember, obviously north sea brent is the one that's most reactive to those kind of sanctions. >> absolutely. let's explain the sanction news a little bit more closely now. the u.s. re-affirmed that it has the init engs to punish iran over its nuclear am bigs by squeezing the country's oil exports. but in a move that should further ease uncertainty in the oil markets, washington has gone back on threats to punish several other countries that buy iranian oil. so you've got the u.s. and iran. here's the two key players. let's take a look at who's been exempted. all the countries you see in red, japan over here and those ten countries in the european region will be exempt from u.s. sanctions. that's after they took steps to stop or at least reduce oil imports from iran. the eu has imposed its own sanctions as we've been reporting and japan has shown some solidarity, despite an energy shortage in the wake of the fukushima nuclear crisis. japan's hands tied by a lack of options at the moment. it's still cutting back on its imports from iran. we don't know exactly the extent of that reduction at the moment. but here are the countries that so far have not done enough as far as the u.s. is concerned. if oour you'll take a look at there, three of the biggest importers of iranian oil, china, you've got india and south korea in there as well. those three could face action from washington. there are nine other nations as well which haven't acted. all of them have until june to avert that threat. now, let's get some analysis on this move by the u.s. and its implications for the global oil market. neil, good to have you back on the show. do you think this will have an impact on the overall price? >> fundamentally, i don't think it changes the situation. japan only has two runners up and running. the electricity demand peak is looming in the summer. it really is very much depend enon crude imports from middle east and lng. i think this move is really not enough to change the market perception, of course, the big player is china and india. they are really still the countries that matter when it comes to iran. >> do you think the u.s. action by showing that it's prepared to roll back the sanctions on these oil importers will help focus minds in china and india, do you think they'll start cutting back? >> i think there are signs that china is already starting to cut back. if you look at the january import dates that we saw 20% reduction in imports from iran as they increased imreports from other countries, such as saudi and russia and india, we're starting to see the pressure bear on china which is the largest importer of iranian crude. i think the strategy is working. >> but at the end of the day, it's much more -- oil is much more sensitive to the straits of hormuz, the potential that iran has to close the straits of her hughes because it's being threatened over its alleged nuclear arms program. so until there are some sort of conclusion on the nuclear issue in iran, would you expect all prices to be underpinned at around these levels? >> yes, i think we'll continue to see a risk premium on oil. if you look at the fundamentals, it would continue to suggest that oil should be trading at closer to $100 a barrel. >> we're talking about brent crude. >> exactly, rather than $123 a barrel which is where it's currently trading. it's unlike we'll see a closure of the straits of hormuz, clearly with 19 million barrels a day passing throe you that critical choke point, anything disruption would have a significant impact on international crude prices. as long as this crisis continues, we'll see crude at elevated levels. >> and the news from saudi arabia that it plans to increase its own oil production by a quarter to 12.5 million barrels a da i from 10 million, not going to make any real difference because the underlying issue of the nuclear issue remains? >> yes. that really doesn't change the fundamentals which is if we lose iran, we've last it globally. i think the question is how much can saudi pump? it's pumping around 10 million barrels a day at the moment, which is the largest amount since 2008, which is, if you remember, we had oil prices spiking up to $150 a barrel. do they have that spare capacity. that's the key question also. >> china is slowing. the world's second biggest economy. is that having an impact on oil prices? >> i think it can. we have seen a slowdown in chinese oil consumption throughout the second half of last year. interestingly we see a pickup in the first two months of the year this year. if we do see a continued slowdown in the economy, that will lead to continued weakness in the market. we do think that china is likely to resume infrastructure projects and stimulate the economy which should result effectively in oil or the man picking up, i think, in china as we go through the we're. >> it's probably not going to be a big swing factor. kneel beveridge there. thank you. south korea has said since the u.s. made this announcement about rolling back the sanctions on certain countries, south korea has said we are still talking to the u.s., we are still looking at ways that we, too, can pull back on iranian oil imports. that's one to watch as well. >> it certainly is. the united states is one of the world's biggest consumers of oil, obviously people drive to work, big distances over there, they're heavy reliant on it. that is why the united states is keeping a very close eye on what's going on vis-a-vis oil prices to see if it can derail the recovery we've seen under way on the other side of the atlantic. in light of the united states, let's take a little bit of a check on how u.s. markets closed on tuesday. at the end of the day, stock markets were down despite an upbeat report on the u.s. housing market. we had concerns over slowing economic growth in china and oil prices went down about 2.3%. andrew? >> and you are watching "world business today." still ahead on the program, as the british chancellor, the finance minister george osborne gets ared to present his budget and the country awaits another round of austerity, what outlook is there for growth? that's next here on cnn. 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>> absolutely not. they can't. that's what we've seen over the last couple of years. inflation has been so high because of high oil prices that it's limited consumption. osborne needs to travel a very careful path. one way to do that, which he has spoken about in the past, have a tiered fuel tax system. when the oil price rises, the tax goes down slightly. >> this is the so-called fuel price stabilizer. >> absolutely. >> let me talk about the ratings agencies. they have said there's a 50% chance they could cut within the next two years or so. what would it mean if britain was to lose its coveted aaa rating? >> it could come sooner than two years, absolutely. what would it mean/from a market perspective, we've seen france lose its and we've seen the u.s. lose its rating. it could have an impact. it suggests going forward our borrowing costs will be higher than they are now. at the moment they're incredibly low. we wouldn't expect that to change in the median turn if we're cut over the next two years. >> kathleen brooks. many thanks. great to get your views. coming up next on "world business today," as mitt romney scores a convincing win in the illinois primary, we'll examine his strategy of focusing his funds on urban areas. that's next here on cnn. first we'll take a quick look at what's going on in the currency markets this wednesday, the euro, the main mover against the u.s. dollar, it's up about a fifth, trading at 1.32 against the pound, 1.58 and against the yen, it is down just a fraction, virtually flat, 83.7. helps transform dry, thinning skin, by strengthening its moisture barrier, for improved texture and elasticity in 2 weeks. reveal healthy, supple skin. aveeno skin strengthening. this is "world business today." live on cnn. welcome back to the show. mitt romney has secure a decisive double digit victory in the state of illinois, increasing his lead in the race for the u.s. republican nomination. the front-runner took 56% of the total, putting him in line to walk away with the majority of the 54 delegates that were up for grabs. in his victory speech on tuesday, he called the result extraordinary before resuming his attacks on president obama's policy. his closest rival, rick santorum took 26% and for his part, he says he's feeling good about winning saturday's louisiana primary. well, andrew, the results in illinois put mitt romney -- showed mitt romney pulling way out in front in chicago and also in other suburban areas with the likes of rick santorum doing slightly better in some of the smaller counties in rural areas around that state. the outcome seems to vindicate romney's strategy of targeting his campaign cash, particularly in urban areas as john king explained to erin burnett. >> math is what politics is in the end. at first glance you might say wow, senator santorum is winning but he's not winning. why? because governor romney is winning big in the chicago suburbs by 30 points, around 57% right now, the cooke county suburbs right here in chicago. in chicago itself, again, governor romney above 50%. if you move arch up here, lake county, governor romney above 50%. move down, come back here to page county. governor romney above 50%. this is where most of the people in the state live, right up in here. you have to run up your margin here and hope your opponent doesn't beat you down here. senator santorum winning huge in the rural counties, 50% here, high 40s, come over here, 47. what you have is less populated tea party voters, evan jen cal voters, christian conservativs.s those voters tend to go for senator santorum. governor romney did what he needed to do, especially up here. this has been the consistent romney mod until the urban areas and the close-in suburbs, not only win but win big. that's where the tv advertising is aimed, right in those markets. the market ads come up. look at this, in the chicago market, that's romney spending right there in the chicago market. if you take that away, see what he did, look at that. his rivals complaining we're being outspent. governor romney would say, looking at that map, money well spent. >> absolutely. just ahead here on "world business today," back to the future. nissan's datsun makes a return after 30 years on the scrap heap. we'll tell you why and where within we come back. from cnn hong kong, i'm andrew stevens. >> i'm nina dos santos at cnn london. warm welcome back to "world business today." >> we're going to update you on the breaking news story this morning from france. police have surrounded a