Vote on its third Bailout Program with a number of members expected to reject the package. This as Alexis Tsipras concedes European Partners got the better of him. Sales in hong kong slump but the Fashion Group says its still pursuing growth opportunities. Coming up on todays show mickey goes to shanghai. The exclusive from the companys ceo. Twitter spares spike on a fake report of a takeover bid but has this happened one time too many . And donald comes up trump. The extravagant real estate mogul leading the gop field despite weeks of controversy. All the details later in todays show. Lets kick off with china. Retail sales, industrial output and fixed Asset Investment all beating forecast. Data came in at 7 . Thats higher than analysts were expecting. The worlds second largest economy is now on track to hit the 2015 growth target. Fancy that. Interestingly they were quick to jump to the defense of the data saying the figures were not inflated and the improvement was hard one. Its real interesting that they make that statement. They see the need to clarify that their data is accurate but the better than expected data comes after a major stock market sell off which prompted heavy Central Bank Intervention. Theyre failing to reflect the positive numbers, major indices ending the session. The shanghai comp losing 3 and the hang seng is still down by. 33 . Many people say this underlines the disconnect between them and the broader economy. Joining us is richard, the chief economist for asia. Good morning to you. Already a bit of scorn on whether this number is accurate or not. What do you make of whether the data is trustworthy and is that the best indicator of the fundamental level of activity in the chinese economy . Well theres a number of questions to address. Has the chinese economy improved close to the first quarter. The answer is certainly yes. This is an economy with considerable data and a very sizable stock market bubble which had some impact on the economy. The economy improved relative to the first quarter. Whats the best gauge of that . I argued for a long time that the nominal gdp numbers are much more reliable. If you look at them in nominal terms they were a 5. 8 year on year in the first quarter. Thats improved to just over 7 . So just above those official real numbers in the Second Quarter. So thats my main focus and its better to look at those numbers. They are a bit more reliable and do present a picture of an economy picking up some momentum before the melt down in the a share market. Well come back to the stock Market Performance shortly but the fundamental question for me on china is can there be a slow landing. From 7 to 6. 8 to 6. 5 or is there a moment where all of a sudden growth collapses by a significant factor . Yeah. A lot of analysts looked for sometime for that sharp break or moment. Ive come to the view that thats pretty unlikely. Im concerned about the prospects. Im concerned that debt is still rising faster than the nominal gdp. It tilted heavily toward investment but that having been said the authorities have got a lot of ammunition left to fire. I still think theres considerable space, particularly in terms of Monetary Policy to continue to kick the can down the road. Richard, the big problem is that Monetary Policy they have been using that over the last couple of months. Four big rate cuts but that didnt really help the economy did it . We take a look at the first half numbers. Industrial production the slowest pace on record 6. 3 . Fixed Asset Investment 11. 4 and the last one ill give you is retail sales. Exports down 2. 5 for the Second Quarter. If we get more cuts what difference is that really going to make . Well i think you make a very good point. The transmission mechanism, the monetary transmission mechanism isnt that efficient and if anything that argues for doing even more which is why were arguing strongly and consistently to our clients. You have to stay positioned for lower Interest Rates in china. Those have been very profitable over the last 18 months and that will remain the case. Clearly looking at the monthly numbers some improvements in the shortterm momentum on the industrial side since april. I suspect well get further confirmation of that in next weeks flash pmi survey which is going to be the next important number on the horizon. The Monetary Policy can get some structure and thats an argument for the authorities having to do more. Losing steam here. Shanghai composite closing down by around 4 . Do you see further pressure on stock prices Going Forward despite further Central Bank Intervention . Well i think i do. Today is an exemplary. They attempt to stabilize the markets that were a work in process and secondly how stock market developments remain. Key for me is really what drove the bubble was an unprecedented build up in margin debt by retail investors. This was really the key dynamic driving stocks higher to ultimately unsustainable levels and we were clear in warning about this during the run up. The bulk of the selling pressure really flows from deleveraging. If you look at the official data on margin positions, they seem to maybe be 2thirds through the process of unwinding those margin positions so i think the authorities can limit the down side but ultimately that pressure will have to continue to come through. Richard, stay with us. Well come back to you and talk more about emerging markets in a few minutes. But first lets turn our attention to whats happening in greece. We have a very important vote happening today and ahead of that the Greek Parliament speaker speaking as a lawmaker says that Parliament Must not conclude the blackmail from creditors. That is a very very strong statement. No going back. The Greek Parliament votes today on the bailout deal amid opposition from mps as the Prime Minister says he has reservations about the package in brussels. I take my responsibilities and its my responsibility. However i wont escape from my duties or responsibility. I have to guarentee the country or social groups would not face destruction. I shall be responsible for the noncollapse of the Banking System. I will not escape from my obligations. I will try to implemented my plan in a four year time frame. We have a certain europe on our lands. I believe we have our crops out in the field and we shall see the results of this crop. If substantial debt relief is not sought but interesting comments coming here from the Greek Parliament speaker. Its really on Alexis Tsipras to show he can pass these reforms in parliament. Its going to be interesting because its going to see him have to get support from his opposition and new support within his party. That latest flash, because he does have the about to delay the vote. Its a big q and a, the speaker is not obliged to schedule it will vote. This could delay the whole timetable. We wouldnt know when the vote would be but she could delay her votes in the Greek Parliament for up to 3 days. Interesting to hear that given that she does have the ability to delay timetables and that would not please the germans. The average mitt cal analyst says that 2 3 of parliament is expected to vote in major of reforms. Its definitely interesting. It really highlights the challenge for the greek government and i found it Just Brilliant what he says overnight. He said i dont believe in the deal. If he doesnt believe in the deal how can he make the country or people agree to a deal. He said im going to implemented it but he has no credibility when he says that seriously. No but thats indicative two factors, a taste of what grexit could be like and also even if he doesnt really believe in it in the shortterm theres nothing to gain. In the medium term this is just pointing to the fact that they probably will pass it and it will resurface in a week or a month or a year but i dont see that theres anything for them to gain given that tsipras has been the most antagonistic. Even he can get more of a deal. We should point out what the imf is saying. Thats absolutely crucial. Not only in greece are we seeing troubles of this being past implemented but we have this big dispute between germany and the euro zone and the imf. You need to take a much much bigger hair cut. Germany doesnt want to do that and you have to be part of this bailout. Maybe this is all bog to fall away before every government can vote on this. Which is possible. Im surprised by the extent of the change in tune in the statement this morning. They have never been quite as hard lined as germany on this but they have been part of the other bailouts. All the others have been very very restrictive and lagarde has not been speaking out in a loud way to say this deal has to change more in favor of greece. Its very odd timing now. I dont think this is surprising at all. With the 2010 bailout they made a huge mistake because back then the imf said the greek debt is sustainable and they said they dont need a major hair cut. What happened two years later we needed that hair cut so the imf said sorry we were wrong on that so theyre not going to make that now. Why not . After the deal has been done . Theyre always the ones to state the obvious. Thats what they have always done. When the slow down happened in emerging markets they said be war ri of whats happening in emerging markets. But this is very much an initial agreement at this stage. Far from being a deal ratified and many hurdles to get over. Well continue that discussion. And really interesting angle. Dont miss our interview with the partys economy spokesman coming up at 10 40 cet. Meantime lets have a look at how markets are trading today. How are we looking . At the moment basically flat. People were waking up to the fact that the greek deal hasnt been ratified yet and was still a long way to go but by the end of trade we were just above flat and as we look at things today were just below flat so the official optimism we saw monday from a greek deal being announced has been muted on tuesday and today as well. Lets look at the stoxx 50. Thats lower than the stoxx 600 but as we said 8. 2 for one week. So a lot of positivity surrounding greece already priced into equity markets over the last week. Lets look at bonds. A bit of movement there considering whether youre considered a core country. It did cross 0. 9 earlier in the week but back down again 2. 0 on the ten year in spain. Euro has been confusing as everment thus today is a small positive gain. 11023. We did dip back below 110 earlier in the week. Sterling as well 15650. A strong rally yesterday when mark carney said were moving closer to an Interest Rate rise. Unemployment and wage data. That will be interesting to watch. A quick look at commodities. Yesterday buy the room and sell the facts. Once we got the iran deal we saw oil prices strengthen again and they have been in general over the last 8 or 9 trading days. Brent 58. 2. Coming up on the show keeping up with the jargon. Its all about picks. What does this latest buzz word mean . And does it even matter . Find out after this break. Fed chair janet yellen will deliver part 1 of her testimony on Monetary Policy to congress today. She goes before them at 10 00 a. M. Eastern time. She had testy exchanges with republican congressmen earlier in the year. Fed watchers say its unlikely yellen will drop many policy hints unless she wants to steer markets toward a september rate hike. As investors gear up for a lift off by the fed what will it mean for emerging markets . They identified five fragile economy which is is joined as the picks. Thats peru indonesia, columbia turkey and south africa. Richard, which of these markets do you think is particularly vulnerable to a potential rate hike . Great question. With a was fascinating to me when we had ten key variables it was an economy thats not typically on investors radar, columbia which came out of the most vulnerable. A current account deficit of close to 7 of gdp in the first quarter. Growth already slowed significantly and could have really quiddity issues if we did move into a period of more risk off in markets if we did get an earlier but more aggressive lift off by the federal reserve. Lets talk about a couplel of the other ones. Two less surprising ones turkey and indonesia. The socalled twin deficit countries. Is that the reason why theyre on the list as well . They have this current account deficit as well . Yeah look. Its really external liquidity is the key variable here. Were looking at economies that are very reliant on hot money flow. Thats not covered by Foreign Direct Investments that tend to be more sticky. The more reliant you are on hot money flow the more exposed you are to any shift in the risk environment. It throws up a number of the usual suspects and perhaps a couple is darker horses. Columbia that we already emphasized and also peru. Theres another key dimension here and thats commodity dependence and thats very important because what we observed is that commodities are are very elastic with respect to the u. S. Dollar. The u. S. Dollar appreciates in response to higher u. S. Rates the more aggressive Monetary Policy tightening. Many of those economies will suffer on the back of that. Turkey is the exception here because turkey is a big commodity importer. Not a net commodity exporter. A lot of people we talked to here on the show they tell us what the fed hikes rates at the end of 2015 it wont lead to a sell off in the emerging markets. Now they have it out of the system. Valuations were lower than in 2013. I know you dont necessarily agree with that view. You think the markets are complacent, why . I do. If you look at the implied volatility across the range of markets, particularly u. S. Equities that trustybarometer, its still at low levels. Theres a clear risk moving forward. Even the fed will have to do more on rates than is currently priced in or the fed stays behind the curve and we get more Wage Inflation than many are anticipating and that protuss margin pressure. Either way risk is well get more volatility in equity markets and that has been the best single one stop guide to stress in emerging markets. If we do get the sharp spike higher its inevitable that well see fall out in emerging markets. As is always the case theyre very reliant on shortterm hot money financing are going to be the ones most exposed. Should we talk about the negative surprises, which country surprised you the most on the positive . Who is better prepared for the rate hike . Going in the other direction what stands out is the relative security of asia. Asia typically sees very strong current accounts deficits relatively limited requirements and particularly the region is a net commodity importer so that dynamic of stronger dollar lower Commodity Prices actually works to strengthen external balances for the region. So the economies that stand out as the basis for us in this frame work south korea thats going to have the biggest current accounts deficit this year thailand the philippines and although china has many domestic issues external solvents and liquidity are not issues that it faces. China looks relatively secure from an external perspective as well. Thank you for your time. Emerging markets chief economist. We want to bring you the latest comments from the greek finance minister. He says a number of measures in the european deal will have a recessionary effect and i dont think that would be a surprise to anyone here. Stating the obvious. Totally. But these debates are going to go on all day and clearly the words we heard so far are very negative and not supportive of the deal but the expectation is that the deal get passed. Still coming up on Worldwide Exchange, how long before iran is pumping its big stock pile of crude oil. The latest on the deal dividing opinion in the middle east. The numbers are accurate and stimulus is working. Japan maintains its inflation forecast noting that head wind versus eased. The central bank however, trims its growth outlook. Greek lawmakers begin debating the bailout deal served on athens. This as they warn the program is recession nary while the Parliament Speaker could delay the vote. Falls to the bottom of the u. K. Market as sales in hong kong slump but theyre still pursuing growth opportunities. Lets have a look at sterling. Were awaiting some u. K. Employment and Wage Inflation data. Sterling 156. 5. That follows a strong rally yesterday after mark barney was speaking where he said an Interest Rate hike was moving closer which did surprise some investors and lead to just and a percent gain yesterday. Up 10 to 15 basis points. Last time we did see positive Earnings Growth of 3 last month. So again in positive territory. Yesterday we had cpi data at 0. 0 . We have inflation data moving quicker than core inflation. Were waiting unemployment and Earnings Data at the moment. U. K. Jobless rate rising for the first time in more than two years. There you go. Yeah and quite a dip in sterling against the green back after that data came out. We have the june adjusted jobless claim at 7,000 at 2. 3 of the work force. We have the Unemployment Rate up 5. 6 . You said the forecast was . 2. 7. So average earnings 3 last month. Unemployment rate thats probably whats moving for the slight gain in trades now to a slight loss in trades. Has been steady at 5. 5 now and its just ticked up to 5. 6 . Dont forget that rally in sterling we had yesterday thus the slight decline coming down 10 to 12 basis points at the moment. Lets move on. Were seeing a softer picture of the board. Its roughly 12 points in the cac 40 up by 0. 2 but its bucking the trend higher by 0. 4 . A lot o