Of the year. European earnings something of a dwrag. Heineken lost its fizz, saying the strength of the euro is going to hit its 2013 profit. Very good morning. We see euro dollar up at twoyear highs on the session. More on that to come. Also on todays show, shares in india slumping after Revenue Growth has lagged rivals despite a profit beat. Well tap into the companys cfo in a first on cnbc interview in around ten memberships. The ecb is preparing to unveil the good, the bad and the ugly from european banks. Well hear from one bank who says theyre the lending mark. And detroit has its day in court as a judge decides whether to give the green light to americas biggest municipal bankruptcy. What does it mean for bondholders and Public Employees with pengs at stake . Is. Boeing is flying high. Well discuss this issue, cargo Aerospace Giant gears up for its First Quarter figures the. On top of all of that, the latest ipad has been unveiled for the latest Holiday Season. Well speak to pc goods mag. Com to talk about the new ipad air. And if you have any thoughts or comments about what were going to discuss today, pleat let us know. Worldwide cnbc. Com. All right. We kick off with the European Central bank. Its outlined which need to improve their Balance Sheets. Over recent weeks, the dr eos biggest tell cnbc they welcome the health check. I think we are heading in the right direction and i do hope that the stress test performance by the stress test that shows that there are banks being undercapitalized. Thats what creates some confidence in the overall structure and the process around restoring confidence in the Banking Sector and restoring the capital needed to get the more sustainable Banking Sector across europe. We are not particularly concerned. I mean, we work very hard in the past couple of years in terms of fixing our capital liquidity and asset quality. So we go to a test shows that we have been quality lasted it would not be a surprised. Its fundamental that we have a stress test as soon as possible. Were going to come out on top. We want a rigorous stress test fast with an International Adviser present. Spain is the best. In spain, weve had stress tests all over. Those are the thoughts of various ceos that weve been speaking to, as well. Mr. Angeloni is giving a briefing right now at the ecb. While that is going on, were joined in studio by chris. Thanks very much for joining us. I see theres a Morgan Stanley survey. They reckon results of the survey suggest between five and ten of the banks be tested by the ecb and further tests could be raised up 40 billion euros. Would that seem right to you . I would think the stress tests are quite intriguing and based on the different scenarios of unemployment levels and ratio rates and the banks levels themselves in terms of the debt theorizing down. So i would say its much higher than that overall. The Balance Sheet a couple of years ago in the stress tests. The european supervisor sets came out and said that it was about six or seven banks that were really im compared. I thought it was more like 30. What the ecb cant have is a stress test that is too weak. Can they go over way and have one that is too stringent . The whole idea is to instill confidence in the eurozone. Theyre not going to create a test that makes the euro system look bad. They node to create one thats credible. What would credit knowledge look like . Well, i think, you know, under the different rules coming in, an eight to one ratio coming in as to be the minimal level of capitalization. Right now, a lot of them, certainly Spanish Banks arent going to pass that test. They have improved, but they havent reached theyre going to have a year dodd it. Are they going to create that in a year . Well, they have shortterm loans to cover their capital impairments. Thats improved the capabilities right now. Theres a bit on of a political football going on between the european commission, the ecb and the member states. He says, look, we dont want to take over supervisory unless we have a common back stop in place. The common Insurance Scheme seems to have gone by the way. Whats the hans chance of getting that mechanism in place . Thats where the argument lies right now in that margo draghi, the head of the ecb is saying if a bank is undercapitalized, then they should be able to go to the Public Sector and get some form of support. Where the european commissioner is saying, no, if they have some problems, they should go to the bondholders. Theres quite a big issue there in terms of the approach to supervisor. Its hard to get a government thats already in programs. If you get bondholders, that presumably destroys Investor Confidence. Why would you invest in Corporate Bonds bonds of banks if year going to see that they might be exposed and turned into shares that you dont want. The other interesting part about this is this testing, you know, the risks and confidence building and asset quality. Im not sure right now that holding these kind of bonds is high quality assets. Looking at Balance Sheets and how comfortable you are of the actual loans and liabilities on those Balance Sheets. How many banks have written off huge amounts of debt saying they have impairments, theyre not going to have confidence in their corporate lender loans being paid back. A couple years later, they bring them all back again. Right now, there are questions still around spain, italy, ireland, france and other countries around the quality of their debt, the quality of their loans. And that net present liability is where the focus should be. You mentioned Spanish Banks. What do you think is happening with the french banks . For a couple of years, theres been a question of the quality of their books. Its something that everyone has an attitude about right now. But i think theres a question whether the french Bank Reporting is actually accurate. Right. Thats quite a challenge to make. You can make that challenge about many banks. Some have had intriguing ways in which theyve reported year on year. Each year, some of their loan books have been really bad and the next year its not quite so bad. Thats where the challenge comes in. Its also with how banks accounts are prepared and how they can make those look like quality tests. Where does this exercise, where does this move to this single regulator leave those not in the eurozone . How are they going to be left by this whole exercise . Theres a huge argument over this in terms of a closer union and the argument of dwafd cameron has to leave with the uk government saying we dont want to close the union. There is now a Banking Union because amongst the eurozone, it makes absolute sense to have one single bank regulator, one single bank structure, because it is one single zone, one single currency. Angela merkel turned around and said there was no such thing as a Eurozone Bank. We thought there was a Eurozone Bank, but there is no Eurozone Banks. Theres a german bank, an irish bank, and the governments are responsible for those banks. Actually, has germany changed its tune on that . Absolutely. The ecb is going to become the sympathy bank. When they get into trouble, is there a collective we still dont know if theres a collective pot to bail them out. The assurance on the ecb and they get bailed out by the ecb in the future. Good. Weve made some progress. Chris, good to see you. Right. So we want to know today, do you trust the ecb to get this stress test right . Chris is good enough to leave his own opinions on how they do that. Go online to vote at cnbc. Com. Thats todays trader poll. Now, the timetable said tapering may be getting pushed back further. The banks will likely delay its Bond Buying Program until march. I think theyre getting in with consensus. That follows a disappointing u. S. September jobs report. The economy added 148,000 jobs, well below the 180,000 that was the consensus forecast. The Unemployment Rate good fall 1. 72 . The report showed low growth in the private sector and a weakening trend over the last few months. And its that employment report which well find out about now. Take a look at this shot of the Dow Jones Stoxx 600. Decliners outpacing advancers at the moment by a ratio of 7 to 3. Were an hour into the session right now and were down towards the session low. We had a rally yesterday for european stocks. We hit fresh fiveyear highs. Today, weve snapped a fiveday winning streak with european equities. Well put the prices up for you. But the ftse yesterday kwas was up some 41 points after the fivemonth highs. Today were down 36 points. The xetra dax, cac 40 down 0. 5 . The ftse mib down 1. 37 . We talked about how banks are suffering today. But there is a sense that European Equity markets have been overbought. Bond yields coming down. Bonds on a bit of a rally. Here we go, look at this. Tenyear treasury yield, now 2. 48 . Its the lowest since the beginning of the summer right now. We were 2. 723 the yooeld just before the end of the Government Shutdown in the United States. So weve come down from 24 basis points in a matter of a week or so. Italian yields, 4. 12 . Gilt yields down 23. 6 . Well keep our eyes on the minutes of the bank of england coming out in around about 18 minutes or so. Well get into that. On the currency markets, the dollar index has been down near a fresh eightmonth low. More companies coming out and complaining about the strength of the euro. Dollar yen, 97. 21 is where we go. Were on a t200day average, lower. More on that. Aussie dollar has come down, off that fourmy height at 0. 9758 to. 9625. Meanwhile, more concerns over chinas banking system, as well. Reports say the bad loans at its banks tripled from a year earlier. It adds chinese banks wrote off over 3 billion in uncollectible loans. This is where we stand at the moment. We are down. Lets get more on this. Li sixuan has the updwat for us out of singapore. Si sixuan. Thank you, ross. The nikkei 225 reversed morning gains, having its worst daily showing in about 20 days as the wronger yen hit exporter stocks. Meanwhile, china markets lost ground with some profit taking, some smaller cap stocks lost evaluation. Media and agricultural shares took the brunt of the selling. On the other hand, despite that low concerns, banksing shares, in fact, got a boost in the mainland on ping ans strong results. The shenzhen tumbled over 2 . Meanwhile, chinese banking shares struggled in hong kong on possible concerns over bad debt writeoff. The hang seng index lost 1. 4 today. Australias asx 200 pulled back a bit, ending down by a modest 0. 3 . Now for a look at apples asian suppliers, that was mostly getting down after apples new product launches. Apples contractmaker foxconn lost 0. 9 today. Lg display bucked the trend up 1. 23 . But other apple suppliers, tpk holding and casetek are under heavy pressure in todays selling. Still to come, stock has opened down 4 on the back of an earnings beat. Add a 28 rise in profit. Why . Well get into it. Well be joined by the cfo right after this. 0 thats a good thing, but it doesnt cover everything. Only about 80 of your part b medical expenses. The rest is up to you. So consider an aarp Medicare Supplement insurance plan, insured by unitedhealthcare insurance company. Like all standardized Medicare Supplement insurance plans, they could save you in outofpocket medical costs. Call today to request a free decision guide. 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But the firm says its clients are responsible for much of the uptick of spending it saw in the Third Quarter and that confidence is more on the rise. Lets get more from bangalor. Im joined by the cfo of wipro. Always good to speak to you on these occasions. Your stock is down today despite fairly good numbers. Why do you think that is . More and more, i try to understand this Capital Market, but the less i understand about it. Fundamentally, we had a good quarter. The first half of the more than the mid point of the guidance we were given. Followed by a marginal expansion 450 basis points. That has resulted in a net Income Growth about 19 quarter on quarter. Very, very pleasing quarter. To know top ten growing at 0. 1 is . More than the company average. So client additions have been has good. The cash flow has been far superior more than 80 after net income operating at cash flow. So good, good overall quarter. Maybe in the sense that your growth has lagged that of your rivals. Are you confident you can catch up now to the money level theyre seeing . Clearly, the top customer has gro grown faster. As you know, we have been working on the mining piece of the activity stwls the hunting. I think the hunt sg showing good results by making sure we have gone from 10 to 11, which are more than 100 million dworls hundred. We have added 45 new customers. And we have been trying to mine more and more out of the existing client base. As far as the hunting engine is concerned, were invested a lot. We are making decent success, but we are still not there. The hunting engine starts firing, we should be able to come to Industry Growth leading rate. How much have you helped to buy the strength of the weakness of the strength of the dollar against the rupee . Well, quite sdweently. I think if you look at the marginal expansion of 250 basis points, coming from operational efficiencies because we had an account in compensation krez on 1st of june which means last month was affected by one month and quarter two got impacted by two months. We had operation efficiencies which mitigated that completely. Plus we got Something Else in terms of the improvement. As a result of which we have our margins of 24. 5. In the past few quarter webs we have been investing a lot in marketing and some of that has started and in more has to come through as you go forward. Overall, definitely the currency appreciation has to be able to get our margin back. So its kind of important that it stays where it is i supposed at this particular juncture. The biggest consumer of i. T. Is financial services. Have you been able to gain any new contracts or gain some ground in that sector of segment of the market . Absolutely. Our growth has been from health care sciences, and from financial services. One is the Retail Banking which we have been doing fabulously well. So as far as insurance is concerned, we have been holding ground. We havent got good growth, although there are lots of opportunities there and we are looking at that. So where the Capital Market is concerned, its a little weak at this point in time, but i think from a Retail Banking where typically a lot is happening in terms of rick management, in terms of compliance driven and in terms of more business being automated in a big way, we are getting a little of market share in those accounts and getting longterm contract events. All right. Good to talk to you out of bang lore. Thanks very much. I hope you have a good afternoon. Lets turn our attentions from indian earnings to here. Nordea, down 1. 3 . Hydros stock up 7. 2 . Good news for britains home retail as the Holiday Season approaches. They posted a 53 jump dm first half net profit. The company is revamping its stores. This comes after five straight years of decline. Down day for heineken. They talk about the strength of the euro weighing on profit, prompting the company to cut its full year outlook. Lets go back here to nordea. Did post a rise in Third Quarter profits. Slightly below market expectation. The nordic regions biggest bank by value says its credit quality continues to improve, especially in shipping. And psa peugeot citron is up 4. 28 today. It could scale back after General Motors is posting a 3. 7 decline in Third Quarter revenue. Stmicro, down 6. 5 after selling off after the chipmaker suffered from weaker demand in asia. Speaking earlier today on cnbcs outlook, the groups ceo discussed it. No, i can confirm that we are in all the major problems, the smartphone customers in the world. I think bought in america and also in asia. And we see opportunities to pervade more with our new products. But, between, absolutely confirm that we are in in all Major Projects and with our major customers. Lets get more from paris. Stephane is there. Hey, ross. Obviously, the situation knot positive for st micro. Its no secret the company lost the contract for the i