tv On the Move Bloomberg September 7, 2015 3:00am-4:01am EDT
crisis. angela merkel is prepared to add 6 billion euros to germany's budget to deal with the influx of refugees. that is what we are watching. a quick reminder of what is happening on the future. it looks like stocks could open higher today. american markets are closed today for labor day. footie futures up by 7/10 of 1%. -- up by .7%. a decline in china. not as big as many would have imagined. let's have a look at how the equity markets fared in the region. shanghai composite finishing down by 2.5%. lower today. don't forget it was closed on thursday, and friday to commemorate the end of world war ii. we had officials in the g-20 to soothe concerns over
the economy. the forecast stabilization in the currency and the stock market in coming months. that did not help the region. asll, the decline not as big many anticipated. here is what is happening. the european stock market opened. we have had an number of weeks of decline. three weeks out of four in the european stock market. gains in london and paris it gains in italy and the north region as well. things are not looking too bad. investors none the wiser until the fes raise interest rates after mixed jobs report on friday. the euro and little bit lower today. money moving into the canadian dollar. money moving into the australian dollar. if the euro falls this week, it will be the third decline. do we have an opening price for
glencore, ftse 100's biggest decline of this year? raise $2.5 plans to billion in share sales. it wants to unload assets, it needs to cut this that pile of $30 billion. it is going to suspend its dividend payments until further notice. american up by 1%. tesco up by 1%. it is selling its korean business by a group -- in bk parsons. that is the action so far. let's get to sherry in hong kong. shery: good morning. chinese markets came back from their break to take another beating. quite a disappointing day for many investors here. it has surged in early trade to lose momentum throughout the
session and and lower by more than 2.5%. --nese stocks now are bearish indicator that could suggest further downsize. index finishing down. eight shares the gain for the first time in six days. that is after falling to a two-year low on friday. stocks in general here in asia are headed for a lower close. their lowest close since november 2012. expanding seven consecutive weeks of losses. finishing with a downward move today. the index already could see further decline. australia down .2%. we are seeing japan lacking direction all morning. it did manage to trade higher by
.4%. weaker held by a japanese currency. back to you. mark: whiskey been in hong kong. oh.re joined by khiem do thank you for joining us. khiem: good morning. mark: would you say the decline in the chinese market is a result of today's of a closed market. may not be as.5% bad as many have anticipated. khiem: i would say the asian market is very difficult to predict on a day-to-day basis, a lot oft involves retail participation. as well as we hear of authorities coming in to do some support as well. on theus really is
chinese shares listed on the hong kong exchange. i would say that that market looks very cheap at the moment. mark: just because it looks cheap, does not mean we should buy it yet. shares have declined. they are down 37% since may. they have declined for four consecutive weeks. give me some reasons why our viewers should start buying shares right now. quality ofink the the companies is a lot more predictable, also -- higher quality companies altogether. the market is trading below one-times book at the moment. yielding 4% dividend yield. we believe the government still has 20 of room to cut rates in order to try to get the economy moving. there are a number of projects
which have been restarted. we think that will translate into higher gdp growth over the next six to nine months. positive on the outlook for the chinese economy. chinese corporate profitability over the coming six to nine months. ofk: what are we to make comments from the tedious a governor who said the routes in chinese equities are close to ending. he said that state intervention prevented systemic risk and stopped a freefall. can you see china continuing to prop up the market? many saying it is a futile path. khiem: i think with the asian market, it is still challenging. outall the shares have been of suspension just yet. we are still talking about
market where over 10% of the shares are still suspended. the valuation of the market has come down. has comemargin lending down substantially. the end of last year's level, we think a lot of speculative activity is out of the market. valuation is coming back. as a mentioned before, i think the whole thing rests on whether the government can actually grow the economy more visibly over the next six to nine months. whether the pboc is prepared to cut interest rates and the requirement ratio to inject more liquidity into the banking system over the next six to nine months. if all of that happens, i think the market has bottomed. mark: you say valuation could come down and still the most expensive stock market --. stock market even after the
route. some say in his to fall by another 20%. do you see it falling another 20% before it stabilizes? khiem: not really. weightedt the average ratio of the combined shanghai index, it is trading 14 times at the moment. that is not that expensive really. needs to fallit by 20% to make it cheaper to i think it depends on government policies. if policies are more deliberately easier, i think the market can rebound. mark: thanks for joining us. head of asian markets there and asset management. getting an opening price on glencore. they have risen .5%. this -- risen 12.5%.
the biggest decline on the ftse 100. it has fallen by 30% since china devalued its currency. its 31 million dollars that pile -- trimming its $30 billion debt pile. cut that pile by one third. it is going to sell assets as much as $2 billion. it is going to suspend its dividends until further notice. debt by is to cut its $10.2 billion. stephanie flanders is here. high stephanie. -- hi stephanie. the mining industry has been --meled, hasn't it back up hasn't it? i we breathe if we get our toes back into this industry?
stephanie: you look at these long-term views of asset performance and you keep seeing commodities at the bottom of the pile again and again. it instinctively makes you want to give another look. see the hard when you weakening picture coming into the emerging markets, it typically in china -- markets, particularly in china. slightly more expensive liquidity thanks to the federal reserve. it is hard to see a bottom in this market. as this at the sector as a whole, -- at the sector as a whole. mark: what can we get excited about? time when we is a
have to expect low returns and general. whatever you think about the precise evaluations of equities, we are at the stage where you are not going to get the high returns that you have gotten in the last few years. there is definitely more volatility. , the your more constrained fundamentals of growth in the developed world, what earnings are actually doing. it is a stick to your knitting kind of picture where you need to know the underlying fundamentals of the company and what is going on. commentsna, a lot of from various chinese officials, telling us the rout is close to ending. one is close to stabilizing. don't fret about the economy. ofre is going to be a period the volatility. do we buy all of the comments
made by officials? stephanie: i think the chinese are closer to taking market forces seriously. thisect the currency to do , to do that. you seldom find u.s. officials at that level talking about where they think the market will go. that tells you a lot. they have learned to step back from market movements. that is something we have not seen in china. why are people looking at china? we knew that would be coming. it is not necessarily that the economy is slowing. way some ofg the these things have been handled. the lack of consistency and what that mixes worry about in the future. the policymakers are important to the future. about not just the short-term economic impact of
the china slowdown. have forct it could the broader emerging markets. developedpictures for economies is ok. i think we were hoping there would be some lift from that. we are not saying that. we have seen and that's we seen a weakening in emerging markets. -- we are seeing a weakening in emerging markets. mark: even though the g-20 released a statement saying no competitive by uh and's. -- no competitive valuation. they stayed focused on japan a few years ago. is that nonsense? think it is interesting they are reminding
these policymakers hear it -- policymakers. they are not supposed to be in this business, i did think the last few months have been a reminder that it is not in their interest to try and chase that demand for the worst of the world -- for the rest of the world. thecountries that are doing best, are the ones who have been able to generate their own demand. stephanie, good to see you. chief market strategist for jpmorgan asset management. link or is under pressure. selling shares -- glencore is under pressure. selling shares. the retailer will sell its south korea unit. europe's migrant crisis. angela merkel is prepared to add 6 billion euros to germany's budget to handle the influx of refugees.
in that.30 billion let's get over to jesse reese brooke. apologies for the sound. alarm andt be a fire bloomberg headquarters. jesse, let's start with glencore. 10%. over it comes after a huge decline. jesse go -- jesse: investors have been focused on the balance sheet. addressinged toward those concerns. they met with investors and announced results. it is an about-face. they could walk and chew gum at the same time. keep the dividend, protect the credit rating. declined.share price week.eek was the biggest they didn't say that.
they said it was a reaction to the feedback they got from investors. believe the news they may today will address the concerns. mark: remind us what they have announced today. tose: they've announced reduce debt by $10 billion. scrapping dividend for the end of year and next year. reducing working capital. they are the key points. arco the debt ratio -- mark: the debt ratio will stay. jesse: they are confident they can maintain that. say? what did he you spoke to them earlier, didn't you? jesse: the price has weighed on him personally. he is confident in the role.
his position is under pressure. he is interested -- as a part of their asset land, they would consider selling minority stake. mark: is he under pressure? he is the main man. he is the person you most associate with, don't you? yes, he has taken his company from the ipo four years ago. the backdrop has been a week commodity. he is the main man there. he is well known in the industry. in some quarters, that glencore magic has diminished. the first ivf talked on television with a fire alarm in the background? -- is that the first time you have talked on television with a fire alarm in the background?
g-20.y instinct the main topic was china. concerns about the slowdown in the chinese economy and the devaluation of the currency. the chinese moving to dispel any concerns. reassure everyone. the japanese still complained. they said their plan for stabilization wasn't detailed enough. some said that was sour grapes. most of the delegates came away with a satisfied with what they heard. the united states went into it complaining, particularly about the violation of the yuan. concerned, thee the yuan is going to be stable. the fundamentals are strong. they stuck to their 7% over the next five years on a yearly basis. growth target. the chinese seeking to reassure the concerned the group of g-20
delegates. many of their economies depend directly on the chinese economy. in addition to that, they're concerned the beginning of the currency war. some say it is to be -- it is the beginning of the competitive valuation. mark: their currency is barely devalued. 2.5%. oh ryan: why reich is that? i asked the canadian finance minister. he said it is about free trade. we put that in that, because we believe countries are fighting from competitive valuation. a strong feeling that a currency war may begin. interestthe subject of rates, we know the imf is not
keen on the u.s. raising rates this year. what was the general feeling among attendees and ankara dacca -- attendees and ankara? from they should refrain raising rates this month. they should be darn sure about prices and jobs. things are going to be ok before they do raise rates. there was a lot of concern about raising rates. stanley fischer was therefore janet yellen. he was telling everyone his assessment of the jobs report which was rather mixed. he said on the one hand, they are numbers. the numbers for last month were good, on the other hand they are not very reliable. mark: ryan, good to see you. good luck at ankara. here we are at twitter. i would tell you where ryan is.
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call 800-501-6000 to switch today. perks are nice. but the best thing you can give your business is comcast business. comcast business. built for business. mark: book back to on the move. things are shaping up on the market. stocks in europe are rising after three weeks of the kleins. -- after three weeks of declines. ankara anding and turkey. europe is taking that as a cue to buy stock. stocks gaining right across the region today. there is an appetite for risk year currencies. the modesty currencies. i am talking about the aussie dialer that's the aussie dollar and canadian dollars. , one ofopic of china
the big declining stocks in europe has been glencore. big news out of the commodity minor. ryan is here. let's start with the price. how is it reacting? the commodity -- the commodity producer and trader. talking about interest and riskier stocks. that is exactly what glencore is. that is after they announced they are going to sell shares and sell some of the assets. they want to trim some of their debts. up close to 12%. they want to do that in order to trim their dirt -- there $30 billion debt. they want to trim it to $10 billion. mark: that is the situation with juncker, the biggest decline are on the ftse. has revoked the emergency measures that have allowed more
than 12 million people into the country and through to germany. policymakers across europe continuing to struggle with the crisis did here's is a taste of the weekends the liberation. over.e for blame games is it is time for making decisions, turning decisions into actions and doing it united. >> it makes no sense to have a public debate on who gets how many billions for what, because this will not be enforced but will stir up the solidarity. the migrants and the understanding by the german people. >> we need to have a european response to this humanitarian crisis which is not acceptable. xenophobia is not the answer. closing borders is not the answer. >> we will continue with our approach. this provides them with a more
safet and save -- and route. , the imf is concerned. we try to do as much as we can when we are asked. mark: merkel's government held an emergency meeting last night. hans nichols, our european correspondent joining us from the main european processing center. what do we know about the summit? has there been any plans? hans: we have a euro figure. for 2016.euro someow there's going to be sort of final budget. it is clear there is a need.
receiving arean here in berlin. we have been here all morning. what's clear is that more refugees are coming in this morning. 17,000e weekend, we saw come into germany from hungary. it is clear that that number seems to be accelerating. the study number was 10,000. the saturday number was 7000. 10,000.unday number was he saturday number was 7000. angela merkel wants to stay within their budget. right now, they have a surplus for 2015. we will see where they come in at. what is it going to cost for 800,000 refugees. up.e was wrapping things
we have a little bit to spare. we will definitely needed to cope. mark, this is a long-term problem. as you can see, with these lines forming, they gave away. increasethey need to their registration process. the lines are moving slow. out, it ises break mostly people. there's a lot of work in these be done. mark: you said there is some frustration. give us a sense what it is like their. how are the refugees responding to the way that european authorities are handling this crisis? hans: there is a mixture of complaints and infamous.
a gentleman said these lines are too tight. there is a fair amount of gratitude. there are volunteers that are giving water and food. i was surprised at how many children that are here. there are a lot of people here. infrastructure could be improved. we saw some people switching to tents. there are red cross facilities all across berlin were some of these refugees are being housed. what do we are hearing from , those arevernment coming from war-torn places and economic migrants. when you look at what has to happen, it is just the beginning of a very difficult process. mark: thanks for joining us.
ourichols -- hans nichols international correspondent. the snap election is too close to call. could this man when? desk at this man -- could this man win? abouts what you think this migration problem, refugee problem in europe. topics. of the the other one is has china theged to stabilize national stock market? will of the fed raise interest rates this month? it is a busy monday morning here in london. i am mark barton here in london. ♪
it is about a: 40 here in the city of london. time for today's top story. it's has revised 20 -- 2016 gdp -- cutting the figure by .1%. the nation's economy grew last year. the world's biggest public we traded commodity supplier, glencore, plans to cut $10 billion from its next that. -- it's next debt.
glencore holds stock in hong kong just before the announcement this morning it to company posted its biggest weekly decline in london trading last week. tesco has confirmed it is selling its south korean unit. the deal to sell the business is valued at 4.2 billion pounds. two weeks until the snap elections, until alexis tsipras --desperate alexis tsipras's -- healexis tsipras's spoke to global -- he spoke to bloomberg about his vision for greece. >> we want to be a government for new democracy at its core. that does not mean we surrender
completely. it means we go into negotiation with concrete arguments and an appetite for communication. foreas the negotiation team mr. tsipras went and without knowing its homework. each review of the agreement, negotiates take place -- negotiations take place. there are points that can be discussed. the agreement includes the targets of fiscal policy. the way to achieve these targets is a matter of national policy. where the ones to decide how to achieve -- we are the ones to decide how to achieve these targets. new democracyhink has a chance of getting into power? they are definitely the comeback kids. don't forget that up until july,
the prime minister was dominating the countries lyrical country's-- the political landscape. after capitulating and assigning a bailout agreement, it is now clear that mr. tsipras is hanged the price for the broken promises -- mr. tsipras is paying the price for the broken promises. cost soummer crisis much to the greece economy. a new democracy started this election from an underdog position. mr. varoufakis was supposed to monitor the transition. he is known for his informal style and language. it seems, judging from poll results, they like his style. that mr.t survey shows
tsipras shows a very narrow lead. some polls suggest that new democracy has the lead. they key to the campaign is what will the decided voters do. will they stay at home? mark: is there a sense that europe would prefer tsipras to be prime minister? that might surprise many, considering the combative relationship between tsipras in europe -- tsipras and europe. seems europe governments, including france thatermany, has decided
mr. tsipras's u-turn is sincere. -- implementing the bailout. interview yesterday, he that this tacit support that he saw for mr. tsipras, he said that european leaders have been for the wants, -- have been fooled waonce. they risk being full's again. mark: it is good to talk to you. the paul czarnecki in that and greece. -- the polls are and that in greece.
greg viscusi is in paris with more. greg, what is expected to be said today? greg: he will try to keep the focus on international affairs which is where he is a stronger us. -- where he is strongest. he could announce that the french military could extend its air campaign to syria. it may not be strikes, it may be reconnaissance. there may be an extension and france's military role. he will talk about migrants. that is another issue where he is on much more culpable ground. kind asasn't been as germany. i think he will try to keep the focus on those issues and away
from unemployment and economy. it is a two hour long press conference. he is not going to be able to control it completely. there will be uncomfortable questions. mark: how can he win the support of the public ahead of the next general election? greg: he is faced with the problem of do you sure your base? or do you play to the fencer? there is like nothing like economic policy to underscore that dilemma. ofmight announce some kind loosening of a program to loosen france's strictly the laws. a round ofunce negotiations about the labor quote. reforming the labor quote, making it easier for companies appeals to centrist voters.
mark: welcome back to on the move. i am mark barton. speculation that saudi arabia will drop its currency is on the rise. andcentral bank governor the world's biggest oil producer dismissed the calls. ryan got the exclusive conversation. are speaking to our debts we're sticking to our exchange policy. -- we are sticking to our exchange policy. well.ved our economy there is volatility in the speculative markets. down the highest
volatility happened with the chinese currency episode. as --l as when some of the thought to speculate on the ford market in our economy. is a good policy for our exchange rate. mark: tell us more about this speculation. you heard him explain after the chinese allow their currency to be devalued. there are a lot of people speculating and you can see that on the one-year forward contract. saudi arabia will do the same. sayheard the central banker that is not the case. asare going to keep the peg
long as our economy is dependent on oil. that is good to be for some time their effortste to diversify the saudi economy. , the the years time saudi's have not abandoned the peg, the cost for someone making that bet is not that high, compared to the game they get if everyone is surprised by the ahead and get go rid of the peg. it is a little bit speculative instrument out there that you can look at. the central banker of saudi arabia moving to dispel any fears are concerns or hopes that some traders might have that they might get rid of the peg. the argument against abandoning the peg is saudi arabia likes stability. people who deal with saudi arabia likes stability. it would make sense to do it in agreement or any collaboration with the other countries.
the other argument is where it's china and cut may have something to gain by allowing their currency to weaken, because it would then aid the other commodities, that is not the case with saudi arabia. in the case of saudi arabia the argumentght -- for saudi arabia getting rid of the realogy -- getting rid of the rail -- it is not watertight. that is what he wanted to emphasize an hour interview. tomorrow we get a preliminary reading of the eurozone gdp, as well as the final reading of growth in japan. companyd's biggest a expected to unveil new iphones.
possibly it's apple tv step top box. fromday we get a decision the bank of england. that is all for this hour of on the move. the pulse is next. francine is here. francine: we have this great guest. we have this in bc member from the bank of england. he was the former central bank member of argentina. to reassure the rest of the g-20 that they were in control of gdp, also -- although growth is slower. the rest of the g-20 were talking about the turmoil. whether he talked about the bubble bursting. whether that was the end of it. what that means, not only for western countries, but what it means for argentina, if you look at it through the emerging markets. they are taking the brunt of this. mark: the west on an equality.
francine: very french-italian theme. then the u.s. started taking notice when we had that book called cap a towel. we are going to try and investigate. they are putting an inequality index. the 10 most successful companies in term of gdp have to do more bridging equality. what it means with the refugee crisis? we talk about it every day. what does it mean the bridging of equality for more row? mark: the pulse is up next. do not miss it and 3.5 minutes time. in the meantime, you can follow me on twitter. what is on your mind today? has china managed to stop the
francine: china slowdown. markets review this live after a four-day shutdown. the world's second largest economy revises its growth downwards. add 6y prepares to billion euros to the federal budget to deal with the influx of refugees. david cameron will set up uk's plans later. glencore under pressure. the minor plans to sell assets and shares to cut back a $30 billion that are. what is next for the worst performing footsie stock? ♪ now welcome to the polls. l