Out record amounts of in the First Quarter. A shareholder pact is wound up ahead of time. All right. A warm welcome. This is the tuesday edition of Worldwide Exchange. Lets to get to on tuesdays show. Angela ahrendts is heading for silicone valley. Well get a closer look at the deal in just a few moments. Rio tinto is up after a bullish sign from miners as rbs morgan john wilson. Julia will be in luxembourg in around 30 minutes. And could the debt loss in washington finally be over or are investors rushing to conclusions . Well hear from a panel of political insiders at 11 45 cet. Plus, forget the debt ceiling. Theres a lack of innovation is the real threat hanging over americas economy. The former Nobel Prize Winner joins us here on set with his new book in the next hour. But first, u. S. Senate leaders say theyre optimistic about a possible deal to end the Government Shutdown and extend the nations debt ceiling. Senate majority leader harry reid said on monday theyve made tremendous progress. Sentiment is echoed by the majority leader Mitch Mcconnell. Reports say their plan would fund the government through mid january keeping in place the sequester cuts but give mortgages a way to ease their impact. It wie raise u. S. Borrowing costs through to at least mid february. Were doing our best to make everybody happy, but everyone knows were not going to be able to do that. Everybody understands were doing the very best we can with all the frailties we have as people and legislators. Senate republicans and democrats will hold a separate meeting today. House republicans have a closed door meeting at 11 00. The spokesman for House Speaker john boehner says republicans will review whatever plan the senate passes. Julia is with us chief International Economist at barclays. Tricky job. Julian, what do you make of the senate plan . Clearly, there has been some progress. We must bear in mind, as you say, if it happens, the deal through january or into mid february, theres still a lot of tough bargaining thats needed. I think whats important is that it shows the congress is seeing some sense here, its recognizing the dangers that if there isnt an agreement, this could mean for the u. S. Economic situation and the financial market. So, as well, its clear Public Opinion has been moving against really all parties here. Its not just the republicans. Although they might have suffered more greatly. The uncertainty can be toxic for business confidence. What weve noticed is this incredible effect that the Financial Markets have over the real economy. Which i dont think we really experienced so much historically. And, you know, programs like cnbc are their role. The information flow is really in force. That means the confidence goes down together and uncertainty plays a very Important Role in that process. Thats why its very important that just as were starting to see the u. S. Economy get momentum, get some traction, that this comes together. Most people now think offerings for 2014. The thing is, at the time when you thought tapering might be in january in february, we have another deadline. Actually, when you look at that, we might not have any taper now until march, the Second Quarter. For us, its a question if its not going to be the middecember meetings, its going to be in march. We know we have another battle looming in january, right . It makes it difficult. And the other problem is theres not a lot of information flow youre going to get. For us, if its not december, its more likely to be march. Youve got the fed transition. Thats really important. And youve got a lot of movement coming from the fomc. So it seems to us that janet yellen is going to want to take stock of the situation, get a very good assessment. Its an enormous move, lets face it. In hind site, first of all, its going to take them long enough just to get some data, isnt it . Sure. Julian, stick around. News out of china, we have a delegation in china at the moment. Apparently theyre saying china will grant 80 billion yuan to the uk. To set up wholesale branches in the uk. They hope to track more banking business. Keep our eyes on that. As we begin today, the Global Markets are broad and those senate talks mean expensive green. Take a look at the Dow Jones Stoxx 600. Theres green on the board, 8 to 2 advancers xurnt krptly outpacing decliners at the moment. The ftse 100 was up 20 points yesterday, currently up another 40 points. 0. 5 higher for the xetra dax. The cac 40 up 0. 3 and the ftse mib is up, as well. Burberry is currently down 3 . It does open down more than 6 after more than seven years with the ceo of burberry. Angela ahrendts will be replaced by christopher bailey. The british mps will investigate whether the initial pricing was set too low or not. Rio tinto, up 3. 3 today after confirming a record level of iron orout put in the quarter. Its going to decide on a potential 5 billion investment in new australian mines. We saw record iron ore data. The iron ore section, as i mentioned, pretty strong. Rcs media group is up 3. 4 today. A lot of these shareholder packs are being winded up in italy. This is the struggling issued newspaper. Take a look at bond rates, as well. Spanish yields, 4. 28 for spain. 4. 265 for italy. Gilt yields, 2779 . Next time around well put treasuries back in. Euro dollar, exactly where we were trading at this time yesterday, 1. 35. The aussie is firmer at 0. 9543 and sterling cable pretty much trading where we were, just below 1. 60. The currency markets are unmoved in the last 24 hours. What about the asi asian tradin session . Sixuan is with us for the latest. Thank you for that, ross. Asian markets are getting a lift on hopes of a u. S. Debt deal. The Prime Minister shinzo abes sweep about Economic Reforms, the nikkei 225 extended a fiveday winning streak, but a slightly stronger yen against the dollar is putting the cap of further up site and it gained a quarter of a percent in todays trade. In china, the shanghai composite saw recent gains ending down by 0. 2 . Hong kong markets are playing catch up to the rally after yesterdays onedaybreak. The hang seng ended higher by 0. 5 reaching the threeweek high. Hong kong listed chinese banks are higher as chinese data on monday showed september new lows reached 787 billion u. S. Topping expectations. Elsewhere, south korea kospi gained 1 today. Asx 200 ending higher b by almost 1 despite the rbas reluctant to cut gainers. Back to you, ross. Thanks very much, indeed, for that. Well take a short break. Still to come, well get to some of the Corporate News. Whats going on in the luxury sector and what does it mean for Angela Ahrendts . Plus, the latest on rio tinto. More to come on Worldwide Exchange. City Group ReportsFirst Quarter earnings at 8 00 p. M. Eastern. Is bank is forecast to earn 1. 02 a share. Thats revenue of more than 8. 2 billion. Up 40 in the last year. Every week, cnbc is asking you to set the trend by taking part in an online poll. This week, two of wall streets banking giants reports were asking how do you trade Goldman Sachs ahead of results on thursday. Would you be long, short, maybe put a hold on the stock inspect cast your vote. Straightaway, youll be able to see the trend. You can have your say on twitter. Use traderpoll. Blackberry, meanwhile, says were not dead yet. Theyre publish ago news article trying to reassure people that theyre here to stay. Blackberrys chief marketing officer says the uncertainty is why its publishing the letter. 6 million android and iphone publishers have preregistered for the launch of its messaging service. Blackberry up 0. 3 today. And walmart is holding its annual Investor Conference today. Its expecting modest gains for fiscal 2014 had. And managed described the climate as challenging. This is amid higher u. S. Payroll taxes, lack of wage growth, inflation and high unemployment amongst lower income consumers. Walmart at the moment, just up about 1 . And what would you ask Marissa Mayer . Streams live on the web. This time, youll get the chance to ask management, including the ceo a question. Submit them by meal to yahoo earnings yaho yahoo earnings yahoo inc. Com. Or yhooearnings. Questions must be in by 3 00 p. M. Eastern. So what would you ask the yahoo ceo Marissa Mayer . Let us know. Get in touch with us. Email us, worldwide cnbc. Com, tweet cnbcwex or direct to me rosswestgate. Backs to one of the Corporate News stories in the u. S. , Angela Ahrendts is going from purses and pumps to ipads and iphones. Shes announced she will be stepping down from burberry to take up a new Vice President at apple. Since she took up the role in july 2006 at burberry, shes prided over an area where the share price has been up. It has had a few fluctuations along the way, though. Christopher bailey is going to be taking over mid 2014. The tech giant, shes now going to work for. Its a collaboration with apple to date. Just takes the brand reach and the Brand Awareness to a totally new levels and the imagery that we were able to capture on the iphone 5s with their collaboration, you know, we always use these shows to keep burberry on the forefront, to take the brand to new heights, and thats really i think what the collection and the collaboration did today. Julian is still with us and stock opens down more sharply this morning. What is burberry losing with Angela Ahrendts and what are they keeping with mr. Bailey taking over the reigns . Mr. Bailey started to work for burberry back in 2001. He was 29 years old at the time. We know hes a fantastic creative director. Its much more difficult to know if hes be a very good ceo at the time where burberry has many challenges in japan in terms of the beauty ranges. On the other side, angela, she has been one of the most or the most ceo last year. We know shes very good at her job. Shes very good, shes been very good in terms of pushing the brand into digital and i think she will do very well at apple. Yeah. This digital, is it important, this whole session strategy, you talked about burberry was the forefront. How important is it for burberry to really utilize dish or how important is the younger client base . Its extremely important. Its really the difference factor for burberry to any other brand. If you look at the strategy on digital, burberry is by far the best. Gucci is doing okay. Every brand now has some strategy, but in terms of percentage, its a tiny portion of their brand. A job at burberry, i think it started in 2009 where burberry was a much Smaller Company and he decided to really experiment with social media and digital. Its created Media Contests being created, as well. Not a problem being on top, is it, the issue is he has to have the right people around him to do the things he necessarily cant. She left, i think, back in march this year. So the entire team is going to be new. Theyve been hiring quite a lot of new people, as well, on the beauty sector. Some other sector. The company will be very different. Burberry is the most bullish investment you can have in the sector. They are a bit more leveraged than the competition. If you are i dont like to think im being brave when im putting money into no, but if you think emerging markets are very rare and china issues growth and you look at assets, burberrys well, reporting, as well, Third Quarter sales today. Weve got mark jacobs. Its completely different. Its much more diversified. Its a different product line. Many different segments in terms of pricing and many different brands. Its emerging markets, as well, but not only. What do you think burberry might do next . You mentioned other companies are much more diversified. Where can you see burberry going into the future in terms of i think trying to be a brand like chanel, not only fashion, but beauty. Beauty can mean perfume and they want to bring back perfume. Right now, i think theyre number 25 in terms of sales of perfume, so theyre really not up there yet. Can you be too exposed to china . Or not . Right now in china, china is a very important part of their business. In fact, if we look at someone else more exposed to china, macau, hong kong, singapore, theyre exposed to traveling chinese city, all in all, it is a very, very exposed brand to china. One final question. The its very fashionable sort of coat, you see it on a ski resort. Is that going to be of interest or how much interest is that going to be . Well, i think the plan was like a thousand these things start at like a thousand ponds, the jackets. The quality, img for this kind of brand, it remains as an investor. The main focus will be can they could it be a target . I mean, in spending Something Like 9 billion euros since 9 11 in purchasing other companies. Or recently the key on Smaller Player it can be a target. Yeah. I dont know i have to find out how much theyre planning to list the free flow. But well see. If in three months time, burberry share prices go down, i mean, its farfetched today. But burberry could be a target. Okay. We heard it here. Good to see you, as always. Lets move on and remind you of whats still to come on the program today. Italy, ireland and portugal are all going up to present their budgets for eu approval. Julia will join us from luxembourg. Weve got uk inflation data coming up prosecute more to come. And these are the headlines from around the globe. U. S. Stocks are raising losses on the news that Senate Leaders may be getting closer to a deal to avertd a possible debt default. Shares in burberry fall, the British Fashion giant unveiled the departure of Angela Ahrendt to apple. Christopher bailey will be taking over. The company has seen a 40 gain in the stock during her time as ceo. Rio tibto sets up its guidance after churning out error amounts of iron ore for the Third Quarter. And rcss Media Group Stock is up in milan. Theyre expecting less incidentser feerns in the running of the newspaper corriere della sera after a Shareholder Group has been wound up. Senate liens leaders sketch out a deal which they need to put to the house. The xetra dax and cac 40 up about 0. 5 . Ftse 100 up 0. 7 . Treasury yields, 2. 72 is where we stand. The aussie has moved firmer today, a fresh fouryear high. Its not on there. Dollar yen, just above 98. Euro dollar, where we were at this time yet as is cable at 1. 5979. China is continuing to weigh in on the drama in washington. Eunice yoon has more. The political gridlock in washington is almost as big a topic in china as it is in the u. S. Thats what happens when your country is the largest foreign holder of american debt. I hope they can talk it out, this man says. Thats hour hard earned cash. China is frustrated that the u. S. Is playing what it sees as a political game with the global economy. If american lawmakers cant reach a deal by an october 17th deadline on raising the debt ceiling, the United States could default on its debt, potentially hurting the world and china. The u. S. Debt ceiling debate is in all the chinese papers. This one says the clock is ticking. China urges United States to clean up its debt problems. And this one says that u. S. Debt ceiling is ruining americas credibility. It won state backed editorial, the official news agency is calling for a new deamericanized world order. But america isnt the only one being blamed. People here are angry at their own government, too. Chinese politicians need to do something about this, he says. China maintains controls on its currency, helping to support exporters here. So its amassed huge dollar reserves and cant do much about it, other than invest in u. S. Treasuries, 1. 3 trillion worth. People in the Chinese Government probably want investments. But still, i guess right now, u. S. However it works out, americas reputation is taking a knock in the eyes of a bewildered chinese public. America sees itself as a super power, he says. Now we know theyre just like everybody else. Eunice yoon, cnbc, beijing. We have data out of the uk. September inflation up 0. 4 . Monthly annual rate 2. 7 . A little stronger than the forecast 2. 6 . Core cpi running at 2. 2 on the year. That was forecast to be running at 2 . Deflation numbers are stronger than we might have thought. September rpi, january on that 0. 23 . That was as expected. August house prices up 0. 5 on the month. 2. 83 the rise. Increase the fastest since october 2010 and the house price index now sur is passed the precrisis peak to hit the highest on record. House prices for first time buyers, this is the group targeted by the governments help to buy scheme. Got an annual increase of 4. 9 , the fastest since august 2002. Producer prices, meanwhile, posted to slow its annual rise since may. Lets get reaction. Just around 1. 60. Julia keller is still with us. We keep thinking inflation is going to dip down and here we have another number not doing it for us, julian. You mentioned the core rate has moved higher. That is problematic, i think. The uk economy is definitely showing some good signs of improvement here. And were seeing a little bit of evidence that gaps are starting to narrow. Were seeing some improvement in hiring intentions coming through. That was particularly evident in terms of the recent survey numbers. And, therefore, to have this inflation stickiness right now does suggest that governor mark carney is going to look out carefully to see if theres going to be some kind of pass through further down the road and the ri