Government has had to go to two in fuel buying in china. They are halting more than 50 of stocks in terms of being able to trade. There is a ban on selling if you are a notable stockholder, if you have 15 you are not allowed to sell. Extreme is what usps World Management called it. Will we see more declines in china . Lets have a look there seems to be a movement out of the havens. The japanese yen had been strengthening and now it is coming off of that sevenweek high. The yen is lower, currently trading at 121. 33. The dollar is slightly less en vogue. The euro is trading higher. Oil, a sudden slight rebound in oil. Biggest us long in oil significantly this year, we are down more than 8 in terms of oil. China is the worry, it is the second biggest demand or. Iran is a worry, yet another deadline missed in terms of lifting sanctions. We still see Morgan Stanley stock to saying they are set for a modest recovery and they are getting it. I will leave you with oil at 1. 6. Jonathan the 5100 up. Lets go to asia. Juliet, the shanghai composite index posted the biggest oneday gain since 2009 they had to do a lot to get that, didnt they . Juliet they certainly did. We have seen some big swings coming in on the composition. Composite. A lot of volatility if you look at where we are opened. We had that slump, we were concerned things stabilized heading into the lunch break, after lunch we saw the buyers moving in on that 50 of the market not frozen. As you mentioned, a lot of measures have been put in place to try and stop these 3. 9 trillion equity routes. We see half of the market open. We had high securities doing a Share Buyback of 3. 5 billion. Here in hong kong, looking at a close of 3. 7 higher, coming back from that big selloff yesterday. Thats all the hong kong index at its worst level since 2009. Elsewhere we saw a Good Movement coming across in japan up by. 61 . Pretty good outcome considering the pullback from iron ore. It has been about a markets in china and those shares in hong kong. Lets have a look at the movers. Hong kong exchanges up by 11 . Still some of those of stocks that are exposed to Mainland China coming under Pressure Bank of indications lifted on the shanghai composite. A lot has been thrown at these equity routes it does seem like today we saw a little bit of a breakthrough certainly buying coming back into the shanghai composite closing out by 5. 8 in what has been a volatile day. Jonathan thank you very much. Lets bring in stephen, he has been watching the developments. Brady leaders deploying a host of measures, but one sticking out, give us details. Stephen lets look at this. This is the authority coming in and saying we need to i dont want to say manipulate we need a recovery here. About half of the market a number of companies, mostly smaller have halted trading. They have been cut in half, most of these are the blue chips which the governments are encouraging big funds to invest in. Now we have the latest news where the regulators coming out and saying, if you are a major shareholder, if you own more than 5 of the shares, you cannot tell sell. You must hold it for six months. You have those stocks that have been falling not being able to be traded, now it is just the blue chips being encouraged to have large funds invested. You are creating a rally, which happened today. There were other moves banking regulators coming out allowing banks to rollover loans backed by shares. They want to encourage buyback of shares by companies through collateralized loans. Even the Public Security bureau the police in china, they came out with a statement saying they will be investigating what they call malicious shortselling of stocks in china. This is a trifecta, if you will of news from policy bodies in china to encourage the market and sentiment did improve. Jonathan you call it the market, i dont know if we can do that anymore. A lot of people say that about the european bond market, things are getting ridiculous. If i looked at the chinese equity market i would think it is falling apart, that is not happening. I look at the bloomberg monthly gdp tracker at around 6. 5 , dare i say, while the equity market generates 10, the actual economy is doing ok. Stephen yes. I look at the window and i am in the heart of shanghai, this is not an economy falling apart. The pace of growth is slowing down, it is coming from a different base. We are not going to get 12 growth rates anymore, it is not going to happen. The latest cpi numbers indicate yes, there is some demand starting to pick up. 1. 4 up on cbi, still less than half of the governments target for the full year, 3 . Inflation is tamed. Deflation continues, deflation basically raises real Interest Rates that goes counter to what the government wants to do. Generally speaking we have seen a bottoming out of the slowdown but now given the volatility of the market, that has thrown a monkey in a wrench if i want to mix metaphors. Jonathan thank you very much. The short of a lifetime, that is what will gross call the opportunity in china. He tweeted that comment on june 3, a few days from ap close on a shenzhen index. Since then it has fallen 30 . On german bonds, he tweeted that and then they had a record low. Today we are at 60 basis points higher on the german tenure 10 year. On both occasions he did not take his advice. I have been very honest that the Chinese Market is a bubble. The bubble has been popped. To my credit, yes, that trade has been right on. Even though we didnt do the trade. Jonathan lets bring in lieu lou cappelli. Execution, execution execution you can get a call right next cute it badly. When you look at china, we can all say it was a bubble. First of all, let me say the evaluation for some parts of the Chinese Market is not externally high. Some parts are in a bubble, but not all of the market. Is important for us to see a stabilization in Economic Growth, i am not sure if we are there. We need to see more fiscal and monetary easing from the government. Jonathan why all the panic . 50 of the equity markets are spending. This is not a developing country, this is the second biggest equity market in the world, why are they panicking so much . This is just a correction from an extreme a strong bull market. The trigger was the regulation of margin trading. Now this is changed, when you have 70 people buying equities in a short time, there is a risk. The mac pro and monetary conditions are more important. Jonathan china seems to be addressing symptoms of a problem, not because of. Not because theres. As my colleague had written, in the 80s and 90s, japan always addressed symptoms. Do drop parallels to china and japan . The reason was a huge buildup of private debt, we see same in china. What is really different is the bubble in japan is not compatible with what we see in china. I also believe that the authorities in china have more control than they had in japan in the 90s. The situation is not as bad as japan in the late 80s. Jonathan what is the feedback loop . If these guys keep kicking the can down the road, when you stop big stockholders from selling, eventually you feel the pain. With the fallout of this decision . I dont believe this is sustainable if you are just german by a ministry measure. We need to see a clear commitment by the government to ease policy. We should not forget the Inflationary Pressure is big. We need to see more in terms of monetary. Jonathan you have managed a lot of money, would you put any in china . We see some value in china, but would we would probably wait. Jonathan are you worried about . Is a coming from the u. S. . It is more the lack of growth in the emerging markets. A potential rate act by the fed will not help. Jonathan overweight equities, where . Japan and europe. Jonathan coming up, we will speak to paul after a four quarter trading update. Then brussels, greek officials will come up with a plan. How could the greek crisis affect tank of england policy . We will discuss the snoozefest of england decision. Jonathan good morning, and welcome back. Lets bring you up to speed with some of the top stories. The greek of government has extended the Nations Capital control through monday. Alexis tsipras and his government rush to pull together an economic plan for the deadline. The proposal may be their last chance to remain in the currency. Officials all the u. S. Economy moving towards conditions that would support an Interest Rate increase. They also expressed concerns about a risk coming from china and greece. The bank of england will announce its latest Interest Rate decision at 12 00 u. K. Time. All economics all almost members of the committee will have to assess the economic and can impact of the budget. That is the top news, lets check out equity markets. It is a day of green in london. The 5100 is up. 5 . The dax is up. We snaps the fourday losing track street street. Lets check in on the euro, a weaker euro. The german 10 year, yields higher. Italian yields down 2. 21 . Other major moves lets lift a lid on the stock 600. Caroline one of the top winners, development, the biggest homebuilder is up 2. 5 . Of 11 for the full year. Average selling price of a home is up 7 . They say they are expecting their pretax profit to be up 45 , well on track to meet their target. The profit is the profitability to be 20 . Meanwhile, the wind party a Digital Entertainment they have received 110 keeper share coming from gbc. Canadas a mel is also helping with the deal. They are working together to year out how they can get a finalize deal. Remember 88 eight is also in on the action, that is another Company Looking to buy the digital company. This is an ongoing saga. Meanwhile, Balfour Beatty is one of the worst performers today. Britains biggest builder serious concerns, mismanaged construction projects. They had an Additional Charge of up to 100 Million Pounds if they keep identifying issues. Worries about the bt beatty. Hayes is up 1. 3 today. They did well in asia, europe u. K. , and ireland. I will let you dig into those numbers more. Jonathan i am pleased to say it is in the green. Paul is a friend of the show, we are in the green, last quarter of the stocks got punished because the comparables were tough. I was digging through the statement this morning, once again, the fx impact away in on earnings. Are you worried about that . Paul you have to focus on things you can focus on. It is good sales growth, it is better profit growth, and excellent cash. I think it is the uniformity that is aiding countries. Jonathan what i look at the breakdown, that has been stolid solid for a while come out when i look at the growth numbers, the majority of the business comes from temporary highs. The smaller side is getting a stronger growth, is that something you continue you think will continue . Paul for us in this part of the economy we expect to see permanent growth about two times temporary growth, why . There are people who have not changed jobs, comfort will coming back into the market. Things like campaignfinance, a cautious candidate market is stronger. The nice thing is the uniformity across the world. Jonathan we talk about europe i want to talk about the u. K. Quickly and the budget announcement yesterday as you say, i strong sector has been construction. You see this headline about a living wage. What the policies mean for your business . Paul i am not sure. You stand back, we had these in growth. You have to have Economic Growth to increase wages. You think about people employed by stores on minimum wage it feels like there will be more inflation. The retailers and pass it on retailers will pass it on. There are some real surprises in the budget. Jonathan the focus has been on a budget deficit you are saying we could see some strong Wage Inflation coming through . Paul there are two parts a euro pop a year ago i would be confident there would be wage increases, since then we have had oil prices go down. I think we are seeing 2 . If you think it through, it is trying to push some direct cost across the company. Is offsetting wealth by reducing corporation. Businesses have to think about that. The real good thing is phenomenally competitive u. K. Corporation tax. It makes u. K. A better place to do business. There are some good things. Jonathan to go to the other side of the channel to look across europe, the business has done well across mainland europe. As i sit here need deep in greece your business, and take me back to 2010, 2011, the channels for what we you would call contagion in the market are different than the real economy what are you worried about . Paul in 2010, the job market was recovering it says all companies and candidates back into the bunker. I just think you could never create the same thing you did last time. We have been talking agrees for so long i personally think it will be irrelevant to the broader economy. In many cases i would rather focus on the bigger european economies the 98 of the gdp in europe. Frankly for the rest of the euro, the economy seems good. We are the second largest Recruitment Company in spain. We are of the g2 percent in this quarter versus the prior, that is a lot of candidates. The world made be not great, but i will make my life better. I will change jobs, i will get a pay rise raise. I think currently there are good underlying activities in europe. Jonathan my final question, typically you feel the pain first in your business, you also feel the economy turn first, as you to our europe, are you experiencing any change . Paul no. Europe is strong. We have 14 countries growing. Our European Business feels well set for the next 13 years. Jonathan thank you very much. Up next we head out to athens as the greek government rushes to pull together a detailed economic package, can the nation convince european leaders this one is the real deal . We will discuss that after the break. Equities up. Good morning. Jonathan good morning and welcome back. We are 30 minutes into the trading day. Lets see how things are shaping up. 5100 pushes higher 0. 66 . Of the big correction since the record highs of april, the stoxx 600 down 9. 98 from the years high before the open, a marginal gain yesterday, pushing the higher in the green. The euro, weaker this morning bond deals lower. That is the situation across europe. The big topic as always his grace greece scrambling to put together a an economic package. Alexis tsipras has until midnight brussels time to propose a plan. They say that greece cannot rely on special treatment, she also says the new program would require debt restructuring. We have always advised that the program walk on two legs. One leg is about significant reforms and physical consolidation as we have advised in the case of torture goal portugal lafayette, and iceland, it has worked. The other leg is the restructuring which we believe is needed in this particular case for it to have debt sustainability. Jonathan lets bring in 18 in the team. Guy we need to discuss the deadline the midnight deadline, what are the chances of greece making that . Guy i think they will make it. The question is in what form . Alexis tsipras talked yesterday to the parliament about specific measures. What we understand is the letter he sent was better than the previous one, the tone has changed and become more positive. You have seen that in some of the conversations coming out. There is also a recognition in athens that any program likely to be achieved is likely to be harsher on greece than the previous. The economy here is on his back as a result of which the numerator denominator equation becomes tougher for the economy. To second thing is we are talking about a threeyear program as a result it is longer and probably needs to be more strict. That seems to be the understanding coming out of athens. Will we get a deal . Will be done . I dont know. There is a piece coming out of italy quoting draghi talking about it being difficult, i do not speak italian enough to know what he was saying, nevertheless i think it is being seen as a 5050 call. Jonathan hans the ecb is one of the creditors, they seem to be more cautious, i am talking about others as well, including mario draghi. When you look at creditors, what have we been hearing . Hans creditors want to seize a specific see specific. Yesterday they hinted they wanted a threeyear program. They importantly said they would do prior actions. They would actually show something immediately as soon as early next week. They also wanted a opportunity. They wanted the opportunity to discuss debt restructuring. The comments are not that on. Odd. They were talking about how capital controls needed to stay in place until there was a agreement. If it gets ratified by the parliament, that is a longerterm proposition. What vitamin says is important because it gives you the sense to how germans field earned by the greeks feel burned by the greeks. You heard them talk about how leaving the negotiating table was a mistake. They say the greek government is not credible, and we and the creditors should take everything they say with a grain of salt. One other comment we heard from the finance minister of luxembourg, he is talking about the need to have debt restructuring, not writedown, but a restructuring. We have to wait until the night. Midnight. Jonathan my question on a banks and when they open is, never mind the controls being unraveled once we have a deal, even if we do have one, we could have capital controls for a long time and then youre talking about parallel currency still even if there is a deal because the process could take so long. When i listen to some of the comments from others saying an exit from the eurozone is the best Case Scenario not just for the shortterm, but the next 13 years. It is hard to see even if we get a cam kick on sunday, that this problem will go away soon. Guy i am at the commerce station it is certainly hot here as well as, how exactly do we deal with the bat banks . Is it possible to get them back into working order without issuing a parallel currency. There are rumors floating around about mergers of the banks. There is nothing confirmed. We will wait and see what happens. Theres no deal, ultimately the banks will have to shut down. Then we have to start with new ones and recapitalize, probably with an alternative currency. We have to wait to see what will happen with the deal. Maybe we end up in a situation wher