Jap japan. Youre watching Worldwide Exchange. Bringing you Business News from around the globe. All right. Welcome to the start of this week on Worldwide Exchange. The olympics is on, did you catch any over the weekend . I caught a little of the snowboarding. I was watching the luge yesterday afternoon. The speed they go around 80 miles an hour or something. You head back its amazing. I watch the jump in the u. K. Yikes they were jumping 30 meters. That chap set the world record about 250 meters. A little difference on that. Plenty to come on todays show. The golden arches, its in vietnam. Mcdonalds opening its first restaurant there as hundreds of fans line up to get their big mac. Well bring you an interview with the ceo from mcdonalds later to find out why it took so long to open in the country. And what deals may we find in airways . And how is this going to impact relationships with brussels . Emerging markets stabilized toward the end of last week, but as tapering continues, questions remain about the Growth Outlook for many of these regions. According to hsbc, the Market Growth sat the weakest level in four months. Joining us is karen from hsbc. Good morning, karen. We are looking at the pmis here and we look at the future activity index, it looks like a lot of people are betting on an export recovery. Whats the story here . I think thats the question. Well see the Financial Markets have reacted in quite an abrupt fashion for the outlook for the emerging markets and have seen big currency declines. Some Interest Rate hikes and some fairly large ones, so the question is, are we going to see a positive reaction from those Financial Market moves . Say weaker currencies promoting better exports, or will these current account imbalances adjust by weaker imports and slowing domestic consumption . It does seem from the results of the survey that maybe it will be that Positive Side to the adjustment, which is better exports and reaction to the weaker currencies. The report is manufacturing sentiment at a tenmonth high, but at the same time weve got the sector seeing a record low. Theres a huge divergence there, isnt there . Yes, and it really comes down to those changing currencies, much higher Interest Rate slowing domestic demand. And the combination for weaker exports, slower services, slower domestic economy, should see the imbalances that have built up in the last two or three years, start to close and improve. When do these assets become cheap enough for investors, karen . Well, i think its a combination of both seeing, as i say, that Positive Side of the export story coming through knowing that the internal domestic adjustment isnt too painful, that there isnt any political problems that do surface as that domestic adjustment does come through. So some stabilization activity getting through key elections, of course n many of the emerging market economies this year, it causes not just the emerging market story, its just as important whats happening in the u. S. So its expectations of u. S. Recovery this year and u. S. Yields being scaled back as quickly as they have been over the last six weeks. Then that wall of money thats sloshing around the Global Economy searching for yield perhaps goes back to the emerging markets regardless of how strong activity is there. The best noticeable thing is it hasnt. We have had a fall in yields, a rise in u. S. Treasury prices, and it has not benefited emerging markets. I think it is early days and i think the markets are going to want to see more signs of stabilization in the data. Of course, this is very we have only just had rate hikes and the currency declines. We want to see how the economies do react to that adjustment. So some stabilization, i think some more positive signs that china is still maintaining 7. 5 mo men tim. I think the foundations of that would help the move back to the emerging assets. Karen, just give us a bit of a detail on what youre seeing as far as employment pmis are concerned because you noticed a deterioration across the board right now. That has to set alarm bells for domestic consumption, surely. Yes, certainly, the weak component was the employment side. Its suggesting that employment has stabilized rather than were going to see mass layoffs, but i think with all of this emerging market story, weve got to remember where weve come from. Its not that we are in some troubling period right now, its the three our foryears ago these economies were delivering well above potential. They had record low Unemployment Rates in many of the emerging markets, so we are seeing some of the froth come off them if you like. We are seeing some stabilization from what i think the abnormal period was actually three or four years ago. Thank you, karenward, senior economist at hsbc. Really interesting what you said at what point is it to get involved. Merrill lynch said on friday if we see another 7 to 8 billion of outflows this week, that will trigger sale signal for them. We saw a 14 rally in markets over the next three months when that happened. They said it will be a sell signal. A buy signal. You said sell. Im sorry, buy signal. 14 rally in the emerging markets over the next three months. Well see. Talk the trend by taking part in on your loon poll. The gdp data out this week, which of the continents stock indices would you like most exposure to . The cac 40, xetra dax or ftse mib. We are an hour and seven minutes into the european trading week, and we are a little bit firmer, 64 after a move upwards last week for global equities. The ftse 100 was up 8 . The first week of gapers in weeks. This morning, slim gains. The ftse 100 up seven points, similar for the French Market cac and fairly flat for the ftse. Nokia toward the top of the stock 600. The firm signed a Patent Technology agreement with the taiwan ease filmmaker htc. Both firms have pending litigation. Now investors hope this paves the way for future licensing deals. Nokia stock up 4. 5 . Loreal is also up after nestle could be looking to sell their stock in the biggest cosmetics maker. The firm reports firm results after the close today. Normally there are big stakes here, but loreal could take the shares back and cancel them. And after the bank of englands government floated the idea of a national bad bank, they said it could help the countrys lenders get troubled assets and boost new lows to italian companies. On to bond markets, there shallry yields were 2. 72 yield before the jobs report. They tick down this morning just below that. Beyond yields and gilt yields are a bit higher. Janet yellen will make her first congressional appearance as fed chair on tuesday. The dollar is high against the yen today, currently 102. 21. We got to 102. 65. Last week it was 176. And the euro dollar hit a oneweek high on friday of 136. 49. So we are pretty much still on that. Not Much Movement from friday to now. So, thats where we start here in europe. What about the first trading day in asia . Li sixuan is here with more. We are heading to the key 2100 level. The hang seng index lost a lot,. 30 . In taiwan they ended fax with htc weighing on the index by 4 . Another net loss in q1. Asian markets gained as wall street managed to weather the mixed jobs report. Japans nikkei gained 1. 8 ahead of tomorrows holiday. Soft bank jumped 5. 7 today after an upgrade. Meanwhile, banks in australia helped rebound over 1 . We have been watching chinese banks on the back of the ppocs comments about risk control in the Financial System. And they were under pressure in hong kong today, but its a different showing over in the mainland. Banks especially mixed lenders extended last fridays strong rebound on the hopes of better liquidity conditions in the months ahead. Aside from financial stocks, chinese electric carmakers were also among the top gapiners. This is after subsidies were extended for green vehicles after 2015. Meanwhile, faw also reported a 40 increase in its january sales. So thats a recap of the asian markets. Back to you, ross. Thank you, li sixuan. Now the golden arches have finally hit vietnam. Mcdonalds opened its first restaurant in the country in the capital Ho Chi Minh City. They even have a special sandwich called the mcpork. Well have an interview with the mcdonalds ceo don thompson later in the show. Did you see Steve Martins movie when he tries to say hamburger. Now he has to say porkburger. Okay. They do a lobster burger im told by our producers. Whats the point, have the lobster and throw away the bread. I couldnt agree more. Preaching to the choir. Nestle could be selling off a huge stake in the firm. Well have more after the break. I must begin my journey, which will cause me to miss the end of the game. The x1 entertainment operating system lets your watch live tv anywhere. Can i watch it in Butterfly Valley . Sure. Can i watch it in glimmering lake . Yep. Here, too. What about the dark castle . You call that defense . come on [ female announcer ] watch live tv anywhere. The x1 entertainment operating system, only from xfinity. Youre watching Worldwide Exchange. Switzerlands access to the Single Market is under a threat to limit the number of migrants from the eu. 50 back the initiative proposed by the right wing populous party, the Democratic Union center. The French Foreign minister will now have to review its relationship with switzerland. You were one of the people they were trying to limit, a german in switzerland. Yes, i studied in switzerland and started my first job in switzerland. So i would have been one of the people that may have been pushed out or may have been part of this quota, but let me tell you about the vote. It is very, very close vote. 20,000 votes made the difference. And the turnout was actually quite high, 56 considering previous referendum. And then if you look at where the positive votes came from, they came from the rule eras. I dont think thats a big surprise. Then the voters in the city, they voted against it because probably they know whats at stake here. What way are they voting . They are not voting against the people that come in and generate a lot of money or a savings account, they vote against the people lowly paid . I dont know. Im asking the question. I guess they are voting against a different segment, so the ones that are taking their jobs, the ones that maybe are earning too much, the one that is are filling up the trains, the ones that are, you know, taking up their kids school places. I think its not a very educated vote. And thats my personal opinion. But ill say it, having lived there for they are voting with those people building new homes . It is across the board, it is about those or more about the people that come in and buy up higher properties, make wages high, steal jobs. It was the germans and the italians contingent there. 23 of the swiss are documented foreigners and these 23 said that before they make up roughly a third of the gdp. And thats huge without the foreigners the switzerlands cant exist. It will be interesting to see yahoo move their Financial Base from switzerland to ireland. So they are not alienating just individuals, but they are alienating businesses, too. It will be interesting to see what the brussels reaction will be. We had that in the introduction, and if they change their relationship with switzerland, then switzerland has to go back it was a democratic vote. So i know its not convenient for you, but thats a democratic vote. But then if they change the relationship in a way that was negative to switzerland, then switzerland would have to go back to have another democratic vote and say, things are worse. I dont know how things pan out. Look, theyve got about three years to write this into law to make it to some extent palable to the eu, but this will never be palable to the eu because this is about free labor, goods and services, about capital. And switzerland now breaching one of the principles. Thats a big problem for the bilateral treaties in place. The eu should implement their own principles before telling other people not to do it. Thats a completely different story, isnt it . I think theres going to be sympathy with the government. This is not a governmentled initiative so i think they will work together. The interesting thing will be the rhetoric we get out of brussels and the neps as they are going to be using every possible opportunity. Exactly. Whatever happened to a truly Single Market in the first place . Why not just sort that out for services, okay, lets deliver what it was supposed to be in the first place . The problem is, will this give rise to other populous moves across europe. You have nigel farage tweeting last night, this is wonderful news for National Sovereignty and freedom lovers throughout europe. It is. And were going to get democratic votes in may for the parliamentary elections. Theres a more fundamental question, is that the right way of putting referendum before the people . I think it highlights the question, crystallizes the question about whats going on more broadly in the eu right now. How many people were asked if they wanted a single currency . Well, maybe they would have voted against it. Exactly. Well leave that one. You cant end on that kind of question, ross westgate. Unemployment rates in spain are how much at the moment . And greece . Too high. We hit the unemployment numbers and they have not had the euro. Ill leave that one hanging. Thank you so much. Bank of america is trading near the top 600 after nestle could be looking at ways to reduce their 30 billion stake in the cosmetics giant. Here are the details in paris. Stephane, every analyst suggested that actually they were going to stay as they were and nestle wouldnt do anything about this stake. So what are your thoughts on this report that they are now perhaps talking to loreal about what to do . The speculation has been on and off for a couple years now, but what nestle would do with the 29. 3 stake in l oreal, this morning nestle declined to comment on the report. This is the second largest shareholder of l oreal behind the family with a 35. 6 stake. Nestle already announced to the management of loreal about their plans and could make an announcement at the next Shareholders Meeting in april. They could sell their stock to the public. This preemption right expires at the end of april on the 29th. They said clearly buying back the shares of nestle would make sense for loreal. They will report their data after the markets close. I was told there wont be any mention of the nestle story in the press release tonight, but tomorrow morning there will be a press conference and im sure that plenty of questions will be focused on that report because that will be a significant investment if loreal buys back their shares. The price is worth 32 billion. Thats a big stake. Thats a big stake. Thank you, stephane. Great to talk to you. Joining us from hong kong is charles eung, one of the key questions is whether loreal can continue what they have been doing for the last decade. The ceo suggested that loreal is pulling some of their products and the reaction is negative, whats your take . I strongly believe that loreal has grown in china and will in the next five to ten years. Although give the intense fine competition in china, first we think loreal has the brand fort folio from the premium brand to the mainstream brand in china. I believe loreal will have a more veered acquisition in the next few years. We think this is a good starting point. The third thing, loreal is strong in the hair care sector, be new china we see a huge upside potential for the hair care business in china. So i strongly believe in china loreal can main tape the strong growth in china. Yeah, i believe so. How significant is the other competition you talk about from south korea, i heard that Proctor Gamble are losing the mass market share. What are your thoughts there . Youre right. So for the mass market share, there are two kind of products. One is skin care and the other is hair care. In china in the mass market skin care sentiment, loreal can continue to buy gross than other competitors in china. But lorea slrks the dominant player in hair care beauties. And they have mass product in china. So even given the dominant position for the hair care in china, we still see the upside potential. In the past there are fears of two local brands emerging, so given the small base in china, they have the big upside potential to grow in the mass and professional segment. Charles, you just mentioned there may be some local firms that develop, what is the potential for them . You mean for the local brands, right . Yeah. Yeah. You know, in the past few years loreals Product Portfolio is on the high end. So in order to trade in china, they have to reach the most sale points. So the most efficient point for them to do that is to buy the local brands. And the leverage there works to sell loreal and the other brands. So an acquisition match is a good example. First they are in a good category and the second is to match the Distribution Network in china to penetrate a much lower tier in china. Charles, good to see you, thank you for that. He was joining us from Standard Charter bank. Its game over for the popular game flappy birds. Have you played it . Yes, i have. How long can you keep it up . Not for so long. I get frustrated and bored and am afraid of breaking my scream, so stop. Fans in mourning after the creator of this popular game was reporting as much as 50,000 a day from advertising revenue. And then he said the fame was really his life, not the money. In a series of tweets, he gave a statement saying, he cannot take this anymore, i cant take the 50,000 a day. Still, if you want to be bought out, you should never set out to be bought out. Just cops trait on the product. And then pull the plug unexpectedly. Are you missing it . Have you missed it already . I gave up after the first day. I could see where it was headed, addictive. So we want to know, what computer game do you