That they can bring inflation to their target and also start to infuse growth back into europe. Meanwhile, tensions erupting once again in greece. Good we see the antiausterity government setting themselves a referendum . Only been in power since january. The latest proposals they sent through to the eurogroup doesnt cut the mustard. Meanwhile, the United States still reeling from the very strong jobs data we got on friday. That sent shares lower because it means we are likely to start seeing rate hikes begin. 60 chance now for them to start in september up from 50 on thursday. Equities opening lower across the board in europe. Borrowing costs are coming down for the likes of germany, currently at 0. 38 on the 10year. There is some concern being shown. Borrowing costs rising for greece. Once again concern that there is disagreement between the new government and the eurogroup. Lets look at how the euro is reacting. Coming off those lows. Interesting moves in oil, which are coming a little bit flatter. It has been trading lower today. There are some issues that you might see global inventories build again. So says goldman sachs. Keep an eye on mining today. Lets look at some of the stocks being affected. China, we saw that overall, we are starting to see commodity trade slowdown. The Lunar New Year holiday really crimping oil and iron ore. Iron ore really starting to see the effect on bhp billiton, down more than 1 on the fact that we are seeing surplus. Prices likely to fall for iron ore. Wpp, biggest advertiser in the world beating analyst estimates. It is north america and the United Kingdom that made up for a slowdown in emerging markets. Lloyds off by 0. 2 . They are selling 500 Million Pounds worth of shares. That brings their total of two more than one billion raised this year. They know unless than 23 of lloyds. Jonathan caroline hyde, thank you very much. A blanket of red. Ive got the dax down by about 40 points. Ftse 100 in london down by almost 0. 5 . It is greece set to dominate the agenda in brussels today. This as we see some cracks appearing on that very delicate greek agreement. Eu officials rejected the reform measures as inadequate, prompting discussions of a referendum over in athens. Rebecca christie joins us now from brussels. Great to have you with us. Why did the eu project the proposals and not quite clear what this will be a referendum over. Any clarity on that . What is going on in brussels today probably wont be a decision. The deal that greece got last month was to allow for more months for the continuation of talks over the current Bailout Program and what it might follow on afterwards. There werent any decisions penciled in today. Although everyone would love to have a decision made a, you can get the money the truth is they have a lot more talking to do. It seems the bar is pretty low for the meeting in brussels. What are we expecting from the eurogroup if anything at all . We are expecting a lot of discussion between the greeks and authorities. The greeks are saying, if we cant get a deal with the european authorities, we may need to consider a referendum which would be asking greek voters, do you want us to make the really tough cuts being asked for by the imf and the euro authorities or do you want us to keep selling ahead with what we are doing . Well before we get to that point, there will be many more talks between the eurogroup the greek authorities, and also the other institutions, the imf, the ecb, the european commission. According to our reporting, not so much Common Ground between the different sides. Jonathan never much Common Ground. Rebecca christie, thank you very much for joining us this morning. It is time to get the investment take on greece. Im joined by stuart richardson. Stewart, great to have you with us. Guest thank you for having me. Jonathan a low bar in brussels. This referendum talk, what is it all about . One minute it is on the eurozone, then that is pushed aside. Then it is a referendum on policy. What are you expecting to happen . Guest not much in the short term. I think this whole talk of referendum is one part of the politicking that is going on between brussels and athens. Maybe towards the end of the week, tensions could rise a little bit. Payments could rise a couple billion euros. If greece could raise i dont expect any major interruptions even by the end of the week. Theyve given themselves for months. They are clearly some major issues to be overcome. No major interruptions. Jonathan one of the bottom line throughout all this is that it is clear that whatever syriza are voting on, it will be difficult to deliver on. Do you think we could see this year another election in greece . Guest all possibilities are open. The Main Driving Force of the current malaise we are in is that the popular vote said we dont want the Current Situation. And yet the Current Situation as we see it is just not acceptable for brussels. Something has to give. Either we have another election or we go to some sort of referendum about brussels policy, staying in the euro everything open for negotiation. But the Current Situation cannot last. Jonathan pretty clear that greece cant come to the markets to raise money with the coupon that it is affordable, sustainable. When is the Tipping Point . Clearly the restructuring wasnt big enough. Do we carry on kicking the can and rising through all this for the next couple years . Guest this game could go on for a lot longer than people think. It has gone on for a lot longer than we would have thought. It depends on brussels and the ecb. If they decide to give them more time and they believe there is some sort of reform proposal from athens, then it could go on for another 1218 months. The problem is, this is just kicking the can down the road. User you go for a full debt restructuring or greece has to do something the electorate didnt vote them in for. Those are some Big Decisions to be made. Jonathan the clocks went forward in the United States over the weekend. The early birds are waking up on wall street. I guess they are asking questions on the other side of the atlantic. One of them being, what does this mean for me . What does greece mean to me in 2015 if im outside of europe . Guest 2012 was a completely different year in terms of the whole greek situation. Draghi in late 2012 said, ill do whatever it takes to keep the euro together. That has worked beautifully for the whole eurozone in reducing sovereign bond yields across the board. It doesnt matter at the moment. If the ecb and brussels were to fund them, then this kind of situation doesnt mean anything for the financial markets. Of course, something not sustainable fundamentally could haunt the markets in the shortterm. It is not a problem until it is. If youve got your chips in the game in europe, you run that risk every weekend. Jonathan lets strip greece out of the equation. A lot of people are very optimistic on the markets and on the economy. Do you share that optimism . Guest weve not been great fans of europe for the last couple years, but for the first time with the weaker euro and the weaker oil price, europe has a chance to get a couple quarters of growth behind it. As we seen in the last 67 years, everyone gets very excited of europe turning the corner, but the trouble is that the longer sturm Structural Dynamics of growth are not there. Theres many headwinds for europe which they are not overcoming. Theres still not enough structural reform. We thought that we could see a shortterm cyclical pickup because of the weaker euro and week oil, but over the next couple of quarters and the second half of this year, we are not seeing that big driver from there. Jonathan another false dawn. Stewart is going to stay with us. As europe launches qe, able market comes of age in the United States. Today marks the sixth anniversary of the bull market on the s p 500. We will go through the numbers when on the move returns. For now, the dax off. The ftse 100 almost 40 points lower. Jonathan good morning and welcome back. This is on the move. Today some of the ecb launches its qe offensive. Able market comes of age in the United States. It is the sixth anniversary of that bull market. That is 2200 days over that time the index has more than tripled. The other ingredient, the fed has pumped plenty of stimulus as well. Check out what happens when you overlay fed qe with the s p. Is this what we can expect in europe . Lets ask Stewart Richardson. Weve seen this movie in the United States. We know what happens. Asset prices go higher. In europe, before we sold a single bond, ive got the dax the ftse mib up 18 , the dax close to that. Does this continue for the rest of the year . Guest the next several months it will probably take a fairly reasonable decline in the u. S. In this qe environment. As the ecb comes money in, that is going to boost equity markets. In terms of bond market, which we see the bond yields rise thats difficult to tell. We didnt see it with japan. We are not quite so sure what qe means for the bond markets. We think the yields just drift sideways on maybe slightly lower in the periphery. Jonathan dig into the bond markets and whether this is a moment for the eurozone, but when i look at u. S. Equities, worst day in two months on friday in terms of losses. A lot of speculation as to whether we will get that first rate hike. Going beyond that, the first rate hike, interesting to see what happens once the fed does start rising rates. Economists have crunched the numbers and typically, stocks continue to the form. The you expect that in the u. S. . Guest weve never had rates at zero for seven years. Weve never had that size of fed Balance Sheet expansion. I think whatever happens in the industry, we have to take with a big grain of salt. We are looking at corporate Earnings Growth coming off more than that for the next two quarters, maybe longer than that. Theres a combination of tighter Monetary Policy, but at least bond yields going up and the currency strengthening. This is having an impact on the corporate sector. One of the biggest drivers is this corporate Share Buyback dynamic. Assuming that corporate Profit Margins come down and there is less easy access, then maybe u. S. Corporates will continue to buy their stock back. That could be one of the drivers for a poorer equity performance from here. We are saying, yes we understand the dynamics, but markets normally do well. The economy is actually slowing down at the moment. Corporate earnings are set to come down. Jonathan we can speculate what it means for the equity market. Treasury yields, weve gone from almost 1. 6 , getting too close to that in january on the u. S. 10year, 32. 2 as i sit here now. Through 2. 2 as i sit here now. Guest it looks a bit overdone to us. With the fed, quite a few times in the last 68 weeks, theyve said, we want to start rising rates. It is starting. Do you think the economy is Strong Enough to see higher bond yields and a stronger dollar . We will let you decide in a couple months time. Bond markets are saying, we will test your patience as to how strong you think the u. S. Economy is and whether the global headwinds coming through in a stronger dollar we will see what happens. This is another sort of 10 from from the bond markets. It is basically down to a decision by yellen. Our view is that if push comes to shove, she may not want to raise rates here. If the equity market is remaining quite upbeat at the june or september meeting, margins will probably go for a rate rise. A rate rise could well be off the table. Jonathan will they capitulate . Big question. Up next, we go from europe, much further east. As the japanese recovery weakens and chinese exports go through the roof, we will break down those figures and what they mean after this short break. Jonathan welcome back. Good morning to you. Happy monday if they have a monday does exist. Lets talk chinese exports. Big number for the month of february, jumping by 48 year on year. We need to get someone that can put this number in context. Lets get out to tom or like in beijing. Tom talk to me about this 48 number. I know youre going to pour some cold water on it. Should we be getting that excited . Guest im going to pour an entire bathtub of cold water over it im afraid. There was wild swings in the exportimport data from february. Exports up 48 as you mentioned. Imports collapsing 20 year on year. In fact, those headline numbers are wildly misleading. What is really going on is, we are seeing a strong seasonal effect from Chinese New Year and a strong price affect from the collapse in commodity prices. If you look past those, what you see is exports up 15 so pretty good, but not nearly as strong as the 48 which the headline figures suggest. Import volumes, if you strip out the prices looking fairly resilient. Jonathan when i look at the twomonth average, lets take your number of 15 . That is still a strong number. D you think that number can be sustained . Guest it is a strong number and no, i dont think it can be sustained. China is already the Worlds Largest exporter. There is not a lot of new market for them to tap. Theres been years of strong wage growth, years of yuan appreciation. The u. S. Is doing a bit better but much of the rest of the world isnt doing so much better than it was last year. I think 15 growth is going to be tough to sustain. The government talked about 6 growth as a target in 2015. Our expectation is that export growth is going to converge towards that number. Jonathan i want to take it from china to japan. We got another read of the Fourth Quarter gdp number. Does this mean the recovery is off track . You and i have gone back and forth about the labor market. Is the labor market the better read across . Guest there was good news and bad news in the japan gdp revision. The bad news, headline growth was revised down from 2. 2 to 1. 5 . The good news is that most of that revision came from adjustment in inventory. Inventory was a contributor when they did the first estimate of gdp. It was a drag when they did the second estimate of gdp. In the revision, final demand in the japanese economy is slightly stronger. Put that together with some of the strong labor markets, which you mentioned, and i think theres some fairly decent numbers coming out of japan heading into the start of 2015. Jonathan always a pleasure to have you on the show. Thank you for joining us this morning. It is time to get some final thoughts from Stewart Richardson. You listened to those comments on japan. Theres some optimism in the labor market but certainly stumbling out of recession. 1. 5 growth annualized not too impressive. Is this what is to come in europe . Guest in terms of the similarities between europe and japan, youve got a decline in working agent total population. In certain countries in europe you have declining populations in work. Without huge increases in productivity, it is difficult to see robust longterm economic scenarios. When youve got a bit of a downturn, Something Like the sales tax rise in japan, you see a big drop in gdp, then the spring back. When you look at europe, you get the stimulus coming through from the Monetary Policy. Thats sort of the biggest drag for it. When that begins to diminish, we will see a slowdown again. Europe looks like it is going to be the japan of the last couple decades. One of the big things has been demographics. We are seeing some major currency swings a bit more volatility in the economic numbers, but this whole use of currency as a central policy is moving a bit of the band around as opposed to creating new demand. Jonathan very quickly, i know what it means for the equity market. We saw this experience in japan. But for the bond market, no selloff particularly in japanese government bonds until very recently. Are you expecting a cell the news moment . Im not seeing it in the bond market . Guest with the aging profile of our populations, theres a need for income. That means youre going to see yields across governments remain suppressed. Youve got a massive buyer in town. For the moment, we see no major object in bond yields. This is a distorted market. It is only staying low because of some of the distortions. Jonathan Stewart Richardson thank you very much for joining us this morning. Lets look at what he calls the distorted market. Equities a little bit lower across much of europe. In the bond market, bonds stronger this morning. Yields lower across germany italy, and spain. Jonathan good morning and welcome back. Im Jonathan Ferro and this is on the move. Lets see how things are shaping up for the European Equity market. It is a blanket of red. The dax off by 0. 6 . The ftse 100 down by 0. 5 . Some losses this morning. Lets check in on our top stock stories with caroline hyde. Caroline im focusing on a couple of the big laggards this morning. We were at sevenyear highs on the ftse. Today, we turned lower. The biggest faller is oci nv. It is selling off its construction unit. They are being listed in dubai and egypt. This is a fertilizer producer owned by an egyptian billionaire. Hes separating off the construction area to be listed in dubai. Down goes oci as that change comes through its overall strategy in the way this company is put together. Lafarge down by 2. 3 . Lafarge is a cement maker in the midst of a deal with olson with holcim. The deal terms may be changed. Many feel that lafarges terms are a little too favorable for it. We could see them change. Analysts think overall, the deal will get concluded. Perhaps not much of a win for lafarge. Shares off by almost 2. 3 . On the green side, one of the banks benefiting from the unleashing of 1. 1 trillion euros of bond purchases. Could be helping a couple of these peripheral italian lenders. But come on capacity. Banca monte paschi. Keep an eye on that one. Jonathan thank you very much, caroline. It is the qe kickoff. Mar