The euro coming low once again. Phenomenal. We see the euro being seen as a haven. We are currently up almost 5 in the euro. Were choosingthey the euro instead of the pound, the frank, the dollar. Now, we are seeing it take lowered. Lower. O is going meanwhile, commodities recovering ever so slightly. What a selloff we saw. Crude was at 38. 72. Still below the 40 a barrel mark. Nevertheless, a little bit more optimism coming in. Copper is basically flat this morning. It had been taking that little bit higher after the dramatic selloff we saw. That has been playing into the equities that i want to show you this morning because we have had some phenomenal earnings coming out. The big minor, bhp billiton among them. We will see it move higher. Because it keeps its dividend promise. To theemaining committed dividends. They are reducing production in the oil and gas area. Production cuts and our other three pillars. Iron ore, coal, and copper. 52 slump in profit. Sales down in excess of 20 . They are committed to the dividend which is blowing which is supporting the market. Syngenta up 7 . A 15 premium being offered by monsanto. There are still a lot of regulatory issues because monsanto would become the number one player in agriculture. That are offering 5 more than previously for syngenta. Will they snap but thats with company . That too could be snapped up insurance your zurich insurance. They are offering 5. 6 billion. Ounds a nice uptick. 11 higher. Minutes into the session of the ftse 100 snapping a tenday losing streak. We are higher by what we 5 . A rebound 1. 5 . Lets go over to david in hong kong for an asian market wrap. You are seen three different stories across the asiapacific. Markets ended higher. Compared to yesterday overall, we are doing a little bit better. Theseou are seeing are the chinas markets, india to a lesser extent, japan and then the rest of asia. It does seem to be limited to these two big markets. What happened in japan the it moved depending on what happened in the japanese yen. An inverse relationship between the tw will. You go along on the stocks in short on the year. When we woke up, the yen was much stronger compared to when we went to bed. 1. 18, it went back up to 1. 20. We are back to 1. 19 which is why the story for the japanese it opened 4 lower end of the yen started to we can come flowed back into risk assets in japan and then they yen started to strengthen again. Japan ending the day 4 down. That is the story for the nikkei 225. The other big story is the shanghai composite. Another big plunge today. A. 5 yesterday. We are closing up shop right now at 7. 5 . Everything goal sector is down big. 7 10 . The shenzhen, if you put those teed of ibo together two together. Let me put this local media report which came out this morning. In china. It mayties regular be a sign of maturity. One sign of that is that following the plunge on monday, the regulator did order regular markets to work overtime. That is a story we are looking at here as regulators. Jonathan another bad day for chinese equities and the shanghai composite falling once again for the fourth consecutive session. The question for many investors is when will the government come to the rescue if ever . Nick. Bring in expectations are high for policymakers to step in, will they . As david mention what you are seeing is people trying to read the tea bags tea leaves. Youre trying to prove the negative so the market keeps falling so that is an assumption that the government hadnt intervened. What you are seeing more broadly a lack of clarity about what the governments intentions are. How crucial is the market to the broader Economic Performance . We know this was a market in bubble territory. Trades were trading at 61 times their earnings. That compares to 20 for the s p 500. There was a feeling that this market was a bit inflated. Certainly, there is a lot of concern that the market has blown through these past levels. 3500, now 3000. The question is what will the broader impact be . Savers have about 7 other savings tied up with the stock market. There may be a feeling that a market plunge will not have a broader impact on the economy. Jonathan i hear that again and again that it will not have an impact on the broader economy. Strategists will say the same. Donehat the government has is set the narrative that they are panicking. We have done through that 3500 level. We have dropped through 3000 points. It is a reputational issue becoming bigger in china. Certainly there are a great many questions about the. Overnments credibility whether it has the tools or the wherewithal to manage a crisis. If you put the stock market acai, you do have some broader indicators, some really bad data in recent days that suggest the economy is worse off than people thought. At the same tent, the government does have a great many tools at its disposal. It has trillions in forex reserves. Banks are required to keep a great deal of their money in reserve in case of crisis. The government could roll back that. There is a lot they could do to ease liquidity and pump cash into the system that they are holding off from doing. Maybe they are sticking to that dictum of giving the market a greater hand. We will just have to wait and see. Jonathan for more, we are joint by one of the sharpest minds in london. I dont really know where to begin. I will go back to one of the most interesting points of yesterday for me. I huge cap lower in u. S. Equities at the open. If we sell something in the bond market, we could we would be talking about liquidity for days. When you reflect on what happened yesterday, what should we be talking about right now . It is what we would describe as a brittle market. It applies to equities and bonds of alike. Reflected iness is the fact that you could have episodes like this. Add to this the seasonals from august, a lot of fundamental value managers on holiday and you have futures led markets that can do the type of news that you mentioned now. Jonathan they are looking at their exit strategy. Do you step back longterm . The u. S. Market is proving to be the safe haven because people have greater confidence, domestic demand, and feel that the fed has room to postpone hikes. And therefore the market is seen as a more resilient one. We think that the value is opening up elsewhere. Periphery of the europe and asia. It is too early. We are still in this reversal of expectations. Many houses change assumptions. We will have to go through that meaning affect weaning affect. Have you had your convictions challenged as far as your concern on when the fed will hike Interest Rates . Alle have had december along. We have not changed our view. People talk about the fed being central here. We do not think that is the case. The macro drivers of these moves lie in an oversupply of bubbleties, possibly a in the equity market in china which was alluded to before which is now deflating. Of confidence in the ability of chinese policymakers to sustain demand. Jonathan we will talk about fixed income and commodities. The remarkable thing about yesterday if you told me european stocks are down 5 . Same moves in treasuries. Yours moved higher. What is the story in bonds . They have not been at the epicenter of this move. We have seen tremendous decline the starting point for bonds was already very low. Thate are not focused on class right now. In europe it is being managed by the ecb, the bond complex. Treasuries, i find it remarkable that with the declines youre seeing in stocks, we have managed to break below 2 . Jonathan the reason for that going forward. A much flatter yield curve. Lower inflation expectations. Despite all of the noise around china, they turn the page on fx policy. At goldman sachs, you do not even change your gdp forecast. Why not . It was artie low to begin with. The official numbers were called at 7 . Production has a 1 handle and the heavy industry is probably already in recession right now. That in a way is already being felt in peoples accounts. Jonathan the fears around china . Are they excessive . I think they will be manage the situation. One of the problems we have had this year, which was a big challenge to our commodity call was that in aprilmay, the chinese started stimulating and the equity market when up. The price action in commodities so we had a big bounce in Commodity Prices which in our view was unjustified. And now we are converting to fundamentals which are largely supplyside led. Jonathan stay with us. Talk about commodities being pummeled at bhp billiton. We will talk about the wider Commodity Markets just after the break. Then chinese fallout. How the slowdown in the east could weigh on growth in germany and south africa. Is said to have boost its takeover offer to syngenta. 50 minutes into the session. The ftse bouncing back. We are up by 1. 3 . We will be back with you soon. There is not a single catalyst for this. This is a route over china and Global Growth and the fed. The probability at the at the height is receding. Badhe chinese economy is so that it will pull the global recession,o another than i do not think it is likely we will see a 20 correction on the s p 500. I tell people to because just because i do not think china can come up that recent that easily with a solution. They have other things on their radar screen. Is why this market is trying to find its own level and therefore it is clearing at a lower level than most people had expected. Sure that china will find the right response to overcome its economic difficulties which every economy has to face from time to time. Into a crisis. G we have to respond to that crisis by addressing the real problem. The real problem is the huge structural imbalance in the world economies. China has over invested and iser consumed to where it over consumed in underinvested. Jonathan those have been some of my guess. Guests. A tenday losing streak. We are up by 78 points. 1. 33 . The dax is up by 126 points. This is after the the worst day since 2008. We are raising some of those losses. The shanghai composite and ugly place to be. Down by 7. 63 . The biggest oneday route in some 20 years. Lets bring you up to speed with some of bloombergs top stories. The peoples bank of china has injected money into the market to help support the financial system. As added the shanghai composite fell off below 3000 points for the first time in eight months. The s p 500 entered a correction yesterday. 2. 7 trillion from Global Equity markets. Today, we get a little bit of a rebound. Futures and oil trading higher. Dennis lockhart says it continues to project to expect the hike in a decade later this year. They complicate the outlook for growth. September remains a live possibility. Team september becoming a smaller place. Commodity prices tumble and the concern over Slower Growth in china rises, caroline bhp billiton and they are saying cautious things about the nearterm. Nearterm volatility is going to continue here in china. They say they expect the ongoing Economic Reforms that china is doing to contribute to a perio of market volatility. This is coming from andrew mckenzie. Thehe longterm, modities on outlook particularly by china. They are looking quite optimistic about the second half of the year when it comes to china. This might be helping the share prices. China will grow at a stronger pace in the second half. They see 7 growth for china this year. They say that china is not impossible to read. That is a funny comment. Andrew mckenzie of bhp litan says it is possible. They are articulating their Forward Strategy well. Lets have a dig into the future. They are remaining confident about their outlook about the emerging markets continuing to organize. Focusing on cost cutting. They say they are pulling every lever. They are working every lever to survive the current oil price. They are also reducing their capital expenditures. They are squeezing the lemon is what the ceo says of bhp billiton. They are trying to cut down on costs while they are seeing the commodity route continue. They want to protect their dividends. This is driving the share price higher today. They stuck to their . 62 dividend. They are committed to a progressive dividend. A similar story. Profits are down and sales are down. The dividend this time is not protected like at bhp billiton. It was slashed to the tune of 73 . Talking about some recovery in the media and they feel that potentially in august, there are possibilities. Jonathan be sure to stay with bloomberg tv. We will be all over the miners throughout the morning and we will be speaking to the ceo of bhp billiton about those earnings. Andrew mckenzie will be our guest this afternoon. Big energy players. Marchapril time, they expect the rebounds to happen. Goldman sachs is saying that will not happen. Him jonathan short equities or the flipside . Francesco bonds are another thing. I will give you one fact. Jonathan thank you very much for joining us this morning. Up, we talked germany and how the companies in europes biggest economy is coping with the selloff in china. Jonathan good morning and welcome back. 30 minutes into the trading session in europe. Lets get you up to speed where equity markets are trading. Nothing like yesterday. Biggest oneday drop since 20 oh way. We are up by 1. 7 . The ftse 100 stamping a tenday loss. Snapping a tenday loss. The dax up by 1. 69 . Nothing like a turnaround tuesday in shanghai. The u. S. Dollar raises some of the losses from yesterday. Just about to reach 1. 15. Remarkable move over the last few days. A strong rebound for brent. Bynt, below 44 but up 2. 37 . A lot of stock moves to talk about as well. Lets do that with caroline head. Caroline a bit of m a. I am focusing on syngenta. It is up by 6. 4 . It is being bid for at a higher price point. Juan santos, the u. S. Company, dominant agricultural player, is looking to up its bid. To the tune of 5 . That could drive the stock higher. We have seen a juicy premium being offered overall for syngenta. We are seeing an uplift to 470. We are calling it 380. Will it go higher on the back of this monsanto bid . Will people believe this bid can get through. When it comes to the regulators. Have a look at syngenta up by 6. 3 2 . Rsa also being driven higher. It is based in the u. K. Up by 5 . York insurance zurich insurance. It once a bigger piece of the pie. 520 p is where it trades. T could get as high as 550 p five point 6 billion pounds. Perhaps rsa will want more. Bhp billiton. Up 6 . They stand by their dividends even though their profit dropped 52 . The second half should improve. Jonathan lets move on the story and talk about china once again. This time with a german angle to it. Gdp figures showing 0. 4 growth in the Second Quarter, in line with estimates. China is germanys biggest noneu trading partner, but impact could we see . Lets check in with hans nichols from berlin. When we talk about what is at risk in germany, lets get specific. Hans specifically the auto company. More macro speaking, what we see in these trade numbers, we get a sense of how export driven they are. Some of it was trade related. Some of the numbers came back negative for inventory. Exports were up by 2. 2 . Private consumption was up by 0. 2 Capital Investment was down by 0. 4 . Indication, a strong indication that the Second Quarter of the economy in germany was very export driven and was not relying on Capital Investment. If you look at what the world looks like now in the third july, you saw all kinds of uncertainty in greece and august has been even greater uncertainty in china. In some ways, i am looking forward to the number we get later on today to get a sense of where Business Optimism is. Economy. Export driven we saw that clearly with these numbers. Most of the growth in the Second Quarter was export driven. On the trade deficit with china, in 2014 we saw a drop to the lowest level. Has been inching back upwards as the chinese are buying less german goods. Already for the First Six Months of this year, it is above where it was last year so we are outpacing and it looks like there will be another trade deficit with china. Jonathan tell me what i should be looking for going forward. I look at the german business confidence. When do i start to see the hard numbers take a hit . Are we seeing that now . Hans the numbers have been inconsistent. We have had pmi. They are broadly in line but there has been some diversions. The German Government is concerned enough about what is happening in china that she felt she had to weigh in. Listen to what she said last night about how she is confident that the chinese authorities will try to rectify the situation. I am convinced that china will do Everything Possible to stabilize its economic situation. China is an important partner of the European Union and we are in close contact with them. Top, i talked about the auto industry. Audi is the most exposed to china of the luxury brands. They have reduced their forecast. They had talked about selling 600,000 vehicles. Mercedes for july had a strong month in china. Their sales were up from 42 for the month of july. They sold almost 30,000 cars. We will take a look at the global numbers. A big impact on the auto makers. We will get the july readings how few and audi on sales they have made in china. Thats the situation in germany. The fallout from china to the biggest economy in europe. South africa released its Second Quarter gdp and about two hours time. This on a day after the rant tumbled to record lows and stocks sink. And vernon joins us from johannesburg. Expect the gdp numbers to come out at. 6 for the Second Quarter. That would be the lowest pace of growth since the three months in 2014. That underlines that the president s struggle to reignite growth in the economy which has been hampered by a lack of Electricity Supply and also strikes in labor disputes in berries industries. At then when i look rant, it is a brutal chart. Exporters in south africa, when do i start to see that become a benefit . Appreciated 4 against the dollar in the last five years and we have not seen that translate in manufacturing or export gains. What that means is that the economy is struggling to grow. With the rant at these levels, it pushes the risk of Interest Rates going up. Ratesill make interest the highest since 2010. And companies are already struggling with high levels of debt. At the same time, it increases the dollar Interest Pay