anna: greece edges closer to default as emergency talks go nowhere. leaders gathers and russe -- leaders gather in brussels. we will be speaking with martin blessing about the crisis in his first interview of the day. asian stocks follow europe and the u.s. low as optimism fades for a great deal. we bring you the latest on the market. there is another issue on the agenda -- david cameron is pushing for change in britain's relationship with the eu ahead of a promised referendum.

a warm welcome to the program, everybody. you are watching "countdown." it is 6:00 here in london. let's have a look at how the euro has been trading because greek stocks are stumbling as talks are set to continue today in brussels. 9:00, 1:00, then later in the evening we will see talks continuing. technical talks resume now. the euro is holding pretty steady with the number of headwinds. or had been optimism around the greek deal, but that was pushed away a little bit. that you have to factor in what the fed is doing with the euro being caught in limbo as we continue to stumble through the crisis. let's have a look at how european equity markets traded yesterday. they closed at a point where people were feeling pretty gloomy about brussels, and overnight things have not gotten

better. this is the picture in europe -- stoxx is down, dax is down even m&a failed to tries any positive trading across the european market. it is just in positive territory at the close. u.s. markets picked up that negative five. we had a revision to the rate number, and the greek gloom continue to collapse. you can see the u.s. equity markets closing down 7/10 of a percent. goldman sachs is making very interesting comments about how the markets are going to prepare themselves for an increase in interest rates. he said that just because we are talking about what the fed will do and might do and when, it doesn't need that market participants want to be caught off guard when the day finally comes.

a two-day summit of eu leaders begins in brussels today, as greece moves nearer to the filing of the euro area bailout. joining us now is hans nichols in brussels and guy johnson in athens. it is a busy calendar of talks today. where do we stand? hans: it appears that the greek government is not giving into any demands by the creditors -- it was remarkable yesterday when we saw it go down in the late morning into midafternoon. a continued to go south through seven hours of talk. that we had a finance ministers meeting that ended before it began. all the leaders went back in around 11:00. they went back in and emerged around 1:00, no deal. here's where we stand -- technical games of started an hour ago and they reconvened to figure it out. the actual leaders -- tsipras,

lagarde, younger -- they decided to get some rest and then at 1:00 we had the finance ministers. heading into their meeting last night, they were pretty clear that they are not any closer than they were on monday and that much more work needs to be done. we don't know how much progress was made that to our meeting, or if any progress was made. anna: talk to us about the funds that are available to pay lenders. i remember on june 18 we already had comments that any disbursements of money to greece to pay the imf was simply impossible. hans: they found another positive money -- or at least they signaled that they could use another pot of money. these are from interests made to

the national banks from the european central bank, the s&p profits. 3.35 billion in this. the important thing is that it can be dispersed just by finance ministers -- it doesn't have to go to national parliament like you would have to to get any of that 7.2 billion of the great bailout. it looks like they can use interest payments. you just need euro area finance ministers to sign off. that at least shortens the idea of how you get the money out the door if you have an agreement, with the big copy is that you need an agreement if there are going to be any funds released -- and it is unclear if any progress has been made. anna: let's get to guy johnson in athens. sippers is in brussels -- sit t tsipras is in brussels.

guy: the reason he is not saving much ground is that he will find it very tough to pass any kind of a deal back here in athens and the more we see pressure, there seems to be more of a focus on the imf, on cuts rather than an increase on the amount of money going into the pension system, which the greeks have pushed for. a more broad-based tax rise across the entire population rather than focusing on the upper and -- the upper end. the imf wants a broader approach so all of these issues as they start to change make it harder and harder for mr. tsipras to push back at home. he is already having to deal with a very raucous flank of his

party, and every time we see these changes, see the imf pushing, we start to see it becoming harder and harder for him to pass that legislation and maintain his government. use aware of that but if we can to get a parliament majority within his own party, and we may have to see political changes here. the reason he is being as firm as he is is that he does he has to come back home and sell this deal, and that is becoming harder and harder. anna: meanwhile, we are watching how supportive the european central bank is having to be for the greek banking sector -- what is the latest there? guy: well, the ecb has had to be less supportive over the last few days, but we will get a take on whether we have to have more funds flowing out. we will learn about that a little bit later.

the flood of money last week does seem to have slowed a little bit, but i think toward the back end of the week, no deal being done will signal to depositors that maybe it is something that needs to be picked up again. we will see whether we get a request today for ela funds. we will learn about that later on in the morning, but the bank remains absolutely central. if we don't get a deal over the weekend, by friday, maybe discussion focuses back on currency controls. anna: guy, thank you. we will talk about that possibility with a number of guest. asian stocks slid overnight with the nikkei 225 decreasing. david ingles is in hong kong with more. david, this is part of the

global scene around greece, i'm guessing -- give us the details. david: good morning. especially as we approach the weekend keep in mind, when you look at asia a lot of these individual markets have been bid up over the past few days and if we don't get a deal you want to start trimming positions. what we are seeing today -- the regional benchmark could be a bit misleading. that being said, most of the stocks -- the underlying town is more risk of. -- off. most of the money is going into safe havens. you mentioned japan -- we are down about 1/5 of 1%. one mark and i want to mention is south korea. we have about an hour left in

trade -- that is what the index is looking like. take a look at this -- consumer services. this is tourist related shares. the latest update from the government is that we have 180 cases -- the number of casualties is up to 129. the south korean government finally came out with support measures. we are looking at a fiscal stimulus plan of 13.5 billion -- not a lot -- but they are doing it to cushion the impact of the economy. certainly, it is not helping that when you look at a country like south korea, they are very dependent on exports. there is a slow in china and a lot of these adverse effects coming from the adverse moves from the japanese yen weakening. one last market -- china. they came in for the first time in two months injecting liquidity into the system. 5.6 billion.

and a rare instance, they commentated on the amount of liquidity, saying it is ample. taiwan was up, but very few bright spots across the asia-pacific. anna: thank you very much, david ingles in hong kong. that brings us to our twitter question of the day -- goldman sachs's president said about interest rates that the markets are less ready for a fed liftoff than people think -- what do you think? are the markets ready for a fed rate hike? it doesn't matter how long we are talking about it investors could still be caught off guard. as we had to break, it here is a look at the big interviews we have. from the institute of international finance, we will

be talking with the boss of one of germany's biggest banks. he will talk to us in his first interview of the day -- stay with us for martin blessing's take on greece and all things macro. later, former european central bank board member lorenzo joins us for his first interview of the day. plenty more coming from that conference. stay tuned. ♪

anna: welcome back. it is quarter past 6:00 in london. here are some of the stories you need to know. alexis tsipras will meet creditors again today in a bid to pledge a new aid package for his country. he left the meeting yesterday without a deal and leaders said they had made little progress and no breakthroughs. the latest round of negotiation

comes ahead of next year's a.m. bailout expiring -- next year's bailout expiring. he will travel to brussels as he seeks to advance his renegotiation of the european union. david cameron will talk about u.k. sovereignty and impose immigration. his conservative government has pledged to hold the referendum over britain's membership of the eu by the end of 2017. . who is working with tax officials -- last week, yahoo! ceo reassured investors that the spinoff is proceeding as planned. let's get more now on the situation in greece, and the view from the rest of europe. institute for international finance in europe kicks off

and joining us is chairman of the board of managing directors, martin blessing. thank you for joining us -- right to have you on. i wonder if we can look at these big macro things that seem to be driving investors' thinking. what chance do you attach to the possibility of a grexit or an accidental leaving? what percentage 10 chance you attach to it. -- what percentage chance do you attach to it? martin: today is of course an important day. i think these are tough debates. the greek government is in a very difficult suggestion. the best would be if the greek government and the institutions could agree on a credible path to a good future for greece. i think that will be very

difficult. if there is no agreement, then we will be facing a couple tough weeks. if greece what default or would leave the eurozone, i think that will not be the end of the eurozone but it would be a tough situation to face. anna: what kind of preparations is your bank making right now, martin, with this geopolitical global situation? is it asking questions about how resilient it would if there were to be an exit from the euro by greece? martin: well, the private sector participated in the first greek haircut in 2011 2012, so the private banks attributed roughly $50 billion to debt relief and grace. commerce bank participated -- we have been writing off about $3.1

billion at this point in time the biggest loss we've ever had. since then, most banks have probably only very limited positions on greece. the direct effect on a haircut in greece would be limited, but of course, the question is what kind of effect would it have on other countries? they are much more optimistic today than i was three years ago. i think the ecb -- this is a measurable situation. anna: of course, alexis tsipras talked about if greece leaves the euro it would be the beginning of the end. i know you don't believe that martin. why if we see one member leave does that not mark the euro's demise? martin: well of course, it changes the structure. on the other hand, if one member

basically can force all the other members to pay constantly, without changing, that would be also a very bad sign for all the other countries, a lot of governments asking themselves why do we go to all this pain of restructuring? in the end, the eurozone has to become more competitive. it needs a lot of work. i think in the end, it is a trade-off between the sign that the eurozone stays together forever or giving the sign that we have certain rules that need to be followed and i think we have reached a point where this position has to be made, and my feeling would be that in the end, a false compromise might be as dangerous for the eurozone in the future as a clear-cut. anna: do you think the euro will be stronger or weaker, martin

if we see a deal establishments greece? -- a deal established with greece? martin: i didn't get that question -- could european that? anna: do you think the euro will be stronger or weaker if there is a deal between the creditors and greece? martin: i think, to be honest if they reach a very good agreement today, it will show that greece does reforms and aligns with the rest of the european strategy. that would be the best outcome. the second best outcome would be if there is no agreement, and then you will see the eurozone will move forward so that could also lead in the long run to a stronger integration of the eurozone. anna: let's move on and talk about the federal reserve, martin because goldman sachs

last night was saying they think we are wrong if we think that everybody is ready for a fed left off that markets are not going to be affected by interest rates starting to go up in the u.s.. had you approach what will perhaps soon happen from the fed the start of the rate tightening cycle? martin: well, of course, the movement of the fed -- the interest rate -- is very important for europe and for the global economy. i think that will take a very cautious approach. we see that already. they will also take the exchange rates into account, so we might only see a very slow moving forward into a higher interest rate environment. in europe, given the tensions, i think interest rates will stay low for quite a while.

anna: do you think the difference central bank policies that we are seeing on different sides of the atlantic mean that we will see parity between the euro and the dollar? martin: well i think of course volatility will be quite significant. i think that -- you see in over the last couple days -- despite all the debate on the eurozone the euro was stable around 112 against the dollar. if the interest rates in the u.s. increase, that of course this could further weaken the euro. i think part of the interest rates by the ecb not only are introduced to kickstart credit growth in europe and the economy, but also have the positive side effect for the

european export economy that weakens the euro. of course, europe can also live with a slightly weaker euro. anna: martin, thank you very much for your time. martin blessing. let's continue with our greece conversation. larry summers spoke to bloomberg and told us he sees greece in the euro for the long-term. larry: i don't think there is any reason why greece cannot overtime prosper and converge with the rest of europe, and that needs to be the objective. anna: larry summers there. the deadline for a deal on a ranch nuclear program is just days away, and there are some items that won't be up for discussion, such as how the country uses oil to prop up their regime.

are middle east editor, elliott has more detail. elliott: estimates vary, but according to the un's special envoy for syria, it amounts to around $6 billion per year. if you throw in support for the has ball hezbollah, that amounts to $50 million and $20 billion. it is about keeping the war machine ticking, not so much the fighters of the finance, but mainly to do with the oil that iran sense serious way. according to a bloomberg analysis of shipments of iranian oil, which it leaves out a rainy imports and around arabia toward syrian ports, we are looking

about 10 voyages so far this year. before the civil war in syria broke out, syria managed to service only their own oil fields, but because of the civil war that has gone down. 5% of what it was. iran has closed that gap, and they have been coming in around 10 so far this year, 10 million barrels a day. prices are about $59 a barrel, $600 million worth per year. the problem is, of course, that under sanctions imposed on iran, they can't sell the oil to syria. syria couldn't afford it anyway so they are getting this oil to the syrians. anna: that is the other deadline we are watching. thank you very much. coming up, our next guest

reckons that the current proposals are not only unsustainable but unenforceable. stay with us. ♪

anna: welcome back. 6:30 here in london. time now for a look at the currency markets. we take the swiss franc here, because the swiss franc has generally been bad news for the swiss economy. i have a long-term chart that shows it back in january. the fall in the euro, in the immediate aftermath, you see -- according to an interesting note, even if we resolve the debt crisis, that doesn't mean that the headaches for the swiss government are going to stop.

the frank has been the best-performing major currency against the euro this year. option pricing suggests that it will continue. that is not great for the economy that has been pushing it towards its first recession in six years. back in january, we saw that and hsbc says this curse of success is in today's world that they have been afflicted with. monthly currencies there and tell you about the other stories you need to know. carl icahn has sold his last chairs and netflix reaping a profit of $3.6 billion. netflix, the largest online subscription video platform, is on the index this year. the u.k. prime minister will travel to brussels today as he

seeks to advance his renegotiation of britain's membership of the eu. he will outline his proposals, including plans to protect u.k. sovereignty and impose controls on immigration. to other european leaders during a working dinner this evening. 's conservative government has pledged to the whole the referendum over britain's membership of the eu. alexis tsipras will meet creditors again today in a bid to clinch a new aid package for his country. yesterday's talks ended without a deal and eu officials said they had yielded little progress and no breakthrough. this latest round comes ahead of next week's euro area bailout expiring and imf for payment deadline. let's get more now with jamie murray on bloomberg. good morning. do you think that greece is going to get a deal?

what is your reading coming from brussels? jamie: the incentive to make a deal of the short-term is in everyone's best interest, but i think a key point here is that there is very little on which finance ministers agree. it takes for time to get it right then to put something that has no chance of getting through. the deadline on the 30th will -- if that doesn't happen the next stage is an angry letter. anna: christine lagarde was talking to us recently, suggesting that there is no grace period but if you look at the lesser of the imf law there is a little bit of a period before they start being declared -- jamie: they will be straight away they don't pay the imf, but that is one of the consequences.

there is quite a long period of time before consequences start to get serious. missing the payment doesn't tell you a lot about the solvency of greek banks, and that is what matters. it will be a political decision. we think that there is quite a bit more time than people think. the hard deadline is probably july 20. anna: let's bring in -- thank you -- let's bring in lana. good to see you. we were just talking about what the implications might be if greece doesn't manage to pay the imf by the middle of next week. jamie's take is that if they don't manage to pay it nothing bad happens -- what would be the

applications for you? lana: compliments to jamie and the bloomberg intelligence team. it has been about 2000 days since greece rejected austerity and not much has changed. the key indication here is the outlook,, and the default event will happen. but that will not necessarily affect their credit rating. they will probably make a difference to bondholders. what he will do is shut the door for greece to get imf help for another 15 months. that will make it politically very difficult for europe and the ecb to come to any sort of agreement with greece to create a light at the end of the tunnel in terms of greece for gaining

access to markets. without the imf, -- anna: to have to try distinction between missing the deadline and looking hopeful and missing the deadline and looking dreadful? lena: absolutely. right now, the markets are poised for a last-minute deal. it hasn't happened and it won't. they are still trying to negotiate which fielded to cross. the three paths are negotiation in conclusion approval, and implementation. they've got it all clear at this point -- whatever may come out they won't have any fiscal sustainability at home. the great government has to return -- is this government

after an early election? we are just a week away. anna: jamie, what do success in brussels look like? what are we to hope for? are we hoping for something incredibly vague that maybe has some forward-looking commitments or are we hoping for something that looks like a future for greece? jamie: we have to have the specifics to make good, and the specifics are probably going to be tough for greece. at the moment we are looking at the implication of a lot of measures to address the balance, in those will be unpopular, a big snag in the greek parliament. anna: do you think this weekend will be another one of those dreadful crunch weekends? are we going to talk about capital controls again if we don't see any kind of deal? lena: anna, you're absolutely

right. it is always a crunch time for greece, and without a deal the collapse of social confidence at home, there is a cute political uncertainty -- there is acute political uncertainty. banks are on life cont support. what the ecb needs the prospect of the deal in the making. that there is some advancement being made. this is what we spoke about earlier. it could put the ecb's life support of greek banks on notice. anna: do you really think that there is something that would make the ecb pull the plug? jamie is suggesting it would be

an incredibly political move. lena: absolutely. basically, it is -- they have been very creative. it has been such a long time, this acute reluctance. the remarkable thing anna, is that all of europe's policy resources are at tsipras's disposal. he has all the finance ministers, mario draghi, everyone is there. clearly, europe is capable and willing to make a deal. the fact that the greek government is not taken it is very much a part of its working with the national electorate. anna: thank you very much. stay with us for another 15 minutes here on "countdown." let's turn our attention to south africa -- bloomberg caught

up with the national bank ceo, the man who warned that a pickup in inflation may lead to a rate increase. to talk to us about how south africans feel in the current economic climate. >> it is tough out there. we read the same media. life is hard, the growth rate is not -- even surrounding countries. i think the oil prices helped and with the benefits of lower interest rates, that has helped. but the impact on all increases in rates is making a big dent in disposable income. anna: we will get more out of him on that story later this morning. staying with central banks let's talk about the fed.

the president of goldman sachs said that the markets are less ready for a set of liftoff and people think -- what do you think? are the markets ready for a fed rate hike? he says it doesn't matter how long we are talking about how and when they will start hiking rates, we still could be caught off guard. 6:41 here in london. let's tell you what's coming up. however mayo's new model -- we will bring you more on that. ♪

anna: welcome back. 6:44 in london. there are the stories you need to know. alexis at bristly creditors again today in a bit to clinch in new aid package for his country. yesterday's talks and without a deal and eu officials said they had made little progress and no

breakthroughs. this latest round of negotiations comes ahead of next week's euro area bailout inquiry and imf for payment in the. the 60-38 vote gives the u.s. president fast-track authority to negotiate trade deals, and ends a six-month battle. obama worked closely with republicans to outnumber democrats who opposed it. david cameron will travel to brussels today as he seeks to renegotiate his membership in the european union. you will outline his proposals, including plans to protect u.k. sovereignty. his conservative government has pledged to hold a referendum over britain's membership of the eu by the end of 2017. the ceo of momoinc is offering

to buy out shareholders and make the company private after six months after listing in the u.s. ben, this is a fascinating story. give us the background to it because it is still the tip of the iceberg, isn't it? ben: it is. there have artie been $25 billion in private deals announced this year, momo is one of the latest. they make a mobile app to chat with strangers nearby. the ceo offered to take the company private six months after listing. there has been a ton of deals but what is surprising is that for a company executive to spend more than a year preparing a listing, it does well, and then they want to take it private. anna: we were all making quite a fuss about these chinese companies going to the u.s. to

tap into the capital markets so why are companies now deciding to pull out of the u.s. and go back home? ben: it is really just about the stock market performance and china -- the shanghai composite has been falling for a couple days but in the past year and has more than doubled. a lot of tech executives are really waking up to that and saying if we go back and listed china we can get a crazy valuation. people realize this won't last forever so there is a rush for the exit. anna: get back to china for a crazy valuation. been sent in hong kong. let's talk about cars -- for alfa romeo fans, the long wait is over. they released a new luxury sedan, but is it enough to save the company? it was unveiled in milan, and we were there. >> journalists and guests

gathered in milan for the big review of alfa romeo singing its own praises. the julia is the first in a series of new cars promised by the italian manufacturer. it's 510 horsepower engine was designed by ferrari and will go on sale at the end of the year in europe and next year in the u.s. the car is a new design from the ground up, build at a cornered off-site in italy. after the reveal, the ceo of the parent company said that the julia had been a labor of love. >> the want to give life back to the brand, give it its rightful place in the market something that was one of the biggest things we could do. >> he staked his reputation and

alfa romeo success on it in the models to come. he has invested as much as $5.6 billion in the strategy to produce eight new models including an suv. >> this is one further step in the evolution of the brand. it is a unique car, and threatening people with success is not there. let the specialists threats drive the car -- they will be able to assess how good it is. i think it is an exceptional car. >> mercury wants to see alfa romeo go head-to-head with the likes of bmw and audi. he wants to sell 400,000 alfas a year. with billions invested and get chrysler carrying debt there is not much room for error. anna: in a few minutes, we are

going to get the latest results from the european closing retailer. we know that sales climbed in the second quarter, so all eyes will be on the profitability and margins. here with more is caroline hyde. good morning. strong sales might not translate into profit. caroline: we saw sales up 21% back on june 15. but profitability could be about half of that, and we are expecting it to come up some 12%. of the growth margin is what everyone will be focusing on. 59.8% is what the general consensus is. that one percentage point less it is set to be the weakest growth margin for h&m -- you know the brands -- the weakest

second-quarter growth margin since 2006. the reasoning behind that why we are getting such pressure is the strength of the dollar. a real battle is on in terms of what they purchased. they warn us that this will become much more expensive in the second half of the year. we are also seeing another weight on the shoulders of h&m -- markdowns. unlike the first quarter, where they didn't cut prices the markdowns could once again play into the numbers that we see with h&m. morgan stanley as saying they are expecting the growth margins to decline and we will likely see the pressure continuing. this is a company that is still investing -- they are getting into sportswear, shoes, beauty products.

they need to expand in the u.s. and china and they also need to invest to become more of it on the channel retailer -- omni channel retailer. anna: caroline, thank you. caroline hyde will be back with those numbers at the top of the hour. let's take a look at some of the top stories on bloomberg. tim coulter joins us now. good morning. this is a fabulous story -- chocolate that won't melt in your hands. i have to draw attention to the photo. they have come up with chocolate that doesn't melt and the photo is fantastic. it is to chocolate bunnies in a heat lamp. tim: it's amazing -- i didn't realize it until i read the story, but they have been working on this for decades.

they have been working on it since world war ii. they think they have actually figured it out chocolate that won't melt until 100 degrees. anna: this has implications for sales, doesn't it? for so many years they have made slightly different recipes for different parts of the world depending on how hot it is. that is what area where it has material benefit. tim: when i was growing up, you cap chocolate in the freezer. but the story talks about how all the growth is in asia africa, the middle east -- not north america, not europe not places where it is cool. lena: i've encouraged to think that i can have a bar of chocolate without melting. anna: exactly. you won't get in a mess -- this

is crucial. this is a fascinating technology story, but deeply disturbing -- this driverless car. should a driverless car decide who lives in two dies? can the ethical debate keep up? tim: that is the big question. obviously the technology t is there and the question is can the insurance industry keep up and higher in the philosophers to figure it out? you wouldn't really think that ethicists and philosophers and automakers would have a lot in common. anna: for example, should an autonomous vehicle sacrifice its occupant to avoid killing a school bus full of children? these dreadful questions that people working in the sector might have to deal with. israel -- a story about israel and migrants. tim: it is a big question, one

that is very sensitive. they play a critical part in the workforce, but the number of immigrants, particularly from africa, has swelled in recent years and they are playing a crucial role in the economy. the example is that every hotel room that you sleep and in israel is probably cleaned by african immigrants. but they are no longer wanted her welcome there. lena: this is such a sad and difficult topic. israel is trying to create a nationstate economy, and the constant geopolitical threat -- how do you manage that when you have an open door migration policy? as you mentioned, it is a struggling economy, and the problem is that there are not enough labor force. we would need more production, low wage income jobs. you are just --

anna: it's a contentious issue at the best of times, and then you added tod in the geopolitical tension -- thank you. a fascinating story. let's get to our twitter question -- the president of goldman sachs said in a podcast about interest rates that the markets are less ready for a fed liftoff that people think -- what do you think? are the markets ready for a fed rate hike? we have had a few answers already. he was saying that market participants could still be caught off guard when we see the fed increase interest rates. be sure to stay tuned, because later this morning, the former european central bank investor

will be joining bloomberg for his first interview of the day coming up. we are live in brussels and athens as the talks continue to try and unlock that greek aid package -- more after a short break. ♪

anna: greece edges closer to default. asian stocks follow europe as optimism fades for a great deal, we bring you the latest on the market. there is another issue on the agenda and brussels, david cameron pushes for change in the relationship with the eu, ahead of a promised referendum. ♪ anna: welcome to the second hour of "countdown." timeout for breaking news we

are getting numbers from retailer, h&m. caroline: all eyes on profitability of h&m, the gross margin is the lowest since 2006. we are seeing it come in at 59.4%, the estimate had been 59.8%. profitability being eroded, the reason strong dollar. that has been up significantly against the swedish krona. that is eating up costs. it is also discounting, they have been discounting this winter. they needed to get things off the shelves. they say beauty will be launched in 900 stores. this is a clear sign the company

is investing in new areas of growth. as we can see, second-quarter gross margin missing analysts estimates. we have a look on the share price, moving nowhere, up 4% over the course of the year. it has been a volatile movement when you look at the share price overall. one of the poorest performers when you look at the retail index in europe. h&m losing investor confidence perhaps. anna: let's focus in on what you need to know this morning as we approach the start of thursday. let's look at the greek story through the lens of the euro you will see how these people currency is holding steady right now. our top line on greece is

greece stumbling towards a default, talks ended with no deal in brussels. the talks continue today. the leaders start to get involved as we get into the later part of the morning and into and get -- and into the afternoon. many people divided as to which way the euro goes in the result of a route -- revolution on greece. you can see that the euro is not going very far, very quickly. let's put all of the stock market moves in context. yesterday was a stressful day for european investors. the stoxx europe down .38%. the u.s. markets closed down considerably despite the fact

we have q1 gdp being revised up. things were not as bad in the first quarter as people have previously thought. admits the u.s. markets closed better than previously. greece moves nearer to the june 30 expiry of its euro area bailout. joining us now, hans nichols and guy johnson. hence, where -- hans, where do we stand? hans: they just tweeted where it there is a will, there is a way. the greeks rejected several proposals yesterday, they seem to be holding firm, they are not giving in. we had seven hours of talk yesterday, they broke up and then euro finance ministers were supposed to meet. just as they were supposed to

meet, they call that meeting off. there was a separate meeting starting at 11:00 and ended around 1:00. that ended without any agreement. this morning we have technical talks that started at 7:00 a.m. -- 6:00 a.m. local, excuse me. they will be meeting again, that is the second round third round and talks in less than 24 hours. we will see if they can bridge any differences. besides from the moscovici quote he is always been overly positive, there is not a lot to be overly optimistic about especially if you look at how short that meeting was. anna: the european commission playing good cop perhaps. all of the focus is on whether a

deal can be done in time to get the rest of the bailout money in order to play the -- pay the imf. hans: there is a separate pot of money, this was a bank lending program from 2010i believe, that have some money left over some 3.3 billion euros in early july. you could transfer that to the greek coffers and they could pay the imf without having to go to all of the parliaments. the only thing you need is sign up from the eurogroup which is the finance ministers from all of the countries that share the euro. there is a pot of money that could be easily transferred, but you need a deal and you would need to go to the parliament. anna: let's go to guy johnson. citrus is pushing them in brussels, but he has to take anything he agrees to in brussels back home, how are things looking politically in athens?

guy: that is the reason why we end up with his marathon sessions, citrus knows he has to bring it back home -- alexis tsipras knows he has to go home -- bring it back home. you could probably see the democracy voting it through. the issue is whether or not he can sell it to his own party. they are not always on the same page, the reason why he is pushing as hard as he is in brussels is because life will get tougher him back home in parliament behind me. there are clearly redlines that he feels he cannot pass if he is to make the legislation stick here. one of them is on pensions, i.e. cuts to pensions. he wants to put more money into the pension system via taxation.

the others are less convinced by that. the other thing is the taxation base, the imf, and the other institutions may be looking for a slightly broader tax base that is an area they want to focus on. difficult for alexis tsipras. life is very tough politically for him, that is why he is effectively fighting for his political life in brussels. anna: in frankfurt, the ecb continues to support the greek banking sector, with the latest on that? guy: we will wait and see whether there is another ela application made today. the outflows have slowed out of the banks. as the situation in brussels ratchets up again, maybe we'll see that story again and see more applications being made for ela money. it will be interesting this weekend to see what happens.

if we don't have a deal this weekend, conversations will come back and we will see that story being presented strongly monday morning. anna: thank you very much. let's bring in the chief economist at g plus economics. if there are redlines that are going to be crossed, they will have to be redlines crossed on some side or the other to find a compromise do you think debt reduction has been so much a part of the greek argument for so long is that going to be part of this deal or will we have to wait for a third bailout? lena: the french president made a statement on monday about the market risk clock. there is a willingness to

consider the greek maturities. the question is does it politically headline this particular agreements which could help alexis tsipras at home with voters, that is a big question. after the meeting last night, perhaps they are trying to teach him a lesson about last-minute bring mention -- brinkmanship. there has to be a commitment to something that is sustainable, economically and politically. the important thing is the proposals of the fourth by alexis tsipras have exactly the kind of political risk scenario that created this dual fear about currency devaluation and massive capital's lives in fear about bailing higher net worth individuals.

that is precisely the alexis tsipras scenario we had. this is not the right way to go about economic stability at home. anna: if we end up in a situation where we are not talking about capital controls if we do start talking about it again towards the end of the week, is that where the end? -- they end? it was painful on the ground in cyprus, but it seems in retrospect to have gone smoothly. lena: the job of the government, we talk about trust, it is about restoring trust in great depositors, voters, and taxpayers in their government so they can have a financial system that works in an economy that has hope of growth. without trust, none of it is possible.

the ecb while being effectively the only lifeline for the greek state, it has done -- what it has done has stayed committed to its promise in 2012. without the ecb support, grexit would become certain. greek wants to avoid greek capital controls. we are all about returning the trust. everything has to be done to prevent that. anna: thank you very much. goldman sachs president, gary cohen said in a podcast that the markets are less ready for a fed lift off the people think. what do you think? we will get lena'take later. s a survey says that new york

and london are at the top for development. ♪

anna: welcome back. here are the stories you need to know. alexis tsipras will meet creditors again today in a attempt to pitch a new aid package. officials say they have yielded little progress. this comes ahead of next week's euro bailout expiring. the u.k. prime minister will travel to brussels today as he's to advance -- seeks to advance brennan membership of european -- britain's membership in the european union. his conservative government has pledged to hold a referendum --

over britain's membership in the eu. last week, yahoo! ceo reassured investors that their spin of alibaba is proceeding as planned. london is picked to be one of the best-performing cities. we are joined by the cocreator, john gibson, director of government innovation at the charity nestor. tell us briefly, how you came to the conclusion that new york and london are great for a partnership but -- entre nous a ship but silicon valley is not in their -- there.

>> what we did was we designed a framework for thinking about policy in the area by looking at what goes on in cities around the world and bringing them together. we assessed 40 cities. what we measured was not the quantity of startups in any particular place, or the amount of venture capital, but the quality of the environment. that meant that some places like silicon valley, san francisco, boston, maybe berlin, you would expect them at the top though struck down slightly. -- drop down slightly. places like helsinki moved up to the third. many initiatives coming out of there. there is a gaming industry. the government is quietly doing lots of good things to give it a

chance to grow. caroline: barcelona is interesting, it did well in a lot of the areas, all apart from regulatory environment. what is barcelona doing so wrong? >> they are unfortunate in that a combination of global cause and the government in madrid have effectively banned uber and airbnb from operating. they did badly it is a shame because the rest of the city has been doing lots of good work to try and create the environment. there is no point in investing money in startups if you are then going to ban them. anna: you talk about the city regulatory environments and maybe even national all of the credit or discredit does not

belong to the city's perhaps. >> we focused on things that cities can control. as i said, this is about trying to help them make better policy. we try to focus on things they could change themselves. it is not always possible to hone in on just the things they have control. anna: talk to us -- caroline: talk to us about what london needs to do. >> london came in second. it is great, there is no doubt that london's tech scene is doing well. if you step back from the analysis, it is hard not to be left with the impression that lots of cities around the world

are just moving quicker. they are investing heavy -- heavily. if london wants to maintain its position, it will have to possibly hit the accelerator more. london does not have the key leadership additions in place that other cities have indicated from -- benefited from. we found that cities that make those kinds of changes, the install those positions, and he a change in that performance. caroline: is very cool innovation that you have spotted in one of the smaller cities that is forward thinking that you think, london and new york need to do that if they are going to maintain the crown. anna: what are they doing so right? >> the eye is drawn to be big and small sometimes. at the bigger end, new york's

redevelopment of roosevelt island into a gigantic tech complex is impressive. they have $400 million of land in a massive project cornell university. they're going to create a massive pipeline of skills for the city. lots of people -- places have free public wi-fi, melbourne, dubai has it, why shouldn't london? caroline: this is about building businesses. do you agree that london and new york are where it's at? lena: it is fascinating as a macroeconomists, that with all of the things we used to judge the health of the micro fabric of an economy, the growth potential access to skills and financing, policy risk is one of the key things you highlight. i love the fact that there is potential in london to develop further. i wonder do you think there

should be a public scheme in rolling out digital education for older people like me? >> there is a big question is that belongs in the city or a high level of government. london has seen some good work in this area. they back tech apprenticeships with local businesses. anna: thank you very much for joining us. john gibson, the director of public innovation. four alfa romeo fans the italian carmaker has released a new sedan. is it enough to save the company? the juliet was released to an audience. ♪ >> guest gathered in the lawn for the -- gathered in my lawn

for the reveal. the juliet is the first and a series of cars promised by the italian manufacturer. it's 510 horsepower engine was designed by -- with help from ferrari. it is a new design from the ground up. it was built in the north of italy. speaking after the reveal, the ceo of the parent company said that it has been a labor of love. >> the ability to give life back to this brand, and effectively give it rightful place in the market is something from a car standpoint is one of the biggest things we can do. >> this car is personal for him. he staked his reputation and the alpha romero's success on it.

they have invested as much as $5.6 billion in its strategy to reduce eight new models, including an suv. >> this is one further step in the evolution of the brand, it is a unique car. let the specialists driving car and assess how good it is. i think it is exceptional. >> he wants to see alfa romeo go head-to-head with b&w and audi -- bmw and audi. with billions invested, and see a chrysler -- fiat chrysler carrying debt, there is not much room for error. anna: joining us for more on this revival at alpha romero is chris.

chris, what is so special about this car? chris: as he said, it relaunches the brand. it reestablishes alfa romeo is a viable contender. -- as a viable contender. the fiat and chrysler brands do not produce the kind of margins they would like long-term, alfa romeo has the potential. it is a huge play for fiat chrysler in general. anna: why does he care so much about alfa romeo? chris: it has the potential to compete with bmw and audi. they're hoping for a serious margins from that segment which would help the overall group in a big way. it is important for the group. anna: chris, thank you very much.

coming up, david cameron travels to brussels today to continue his renegotiation of the eu and greece membership. ♪

anna: welcome back. let's check in on the currency market. interesting research out of hsbc which is talking about whether we will see the strength in the swiss credit -- swiss franc continue. it does look set to continue according to options pricing. the frank is the best performing currency against the euro so far. hsbc says even if we resolve the debt crisis with greece, this will still be hanging over the economy.

this is what they call the curse of success in today's world. we leave the swiss franc there for the moment. here are the top stories, the billionaire investor, icahn is leaving his shares of netflix. netflix come the world's largest online video service is in the 500 index this year. alexis tsipras will meet creditors again today to discuss a new aid package in his country. yesterday's talks ended in no deal. his latest round of negotiations comes ahead of next week's euro bailout and imf repayment deadline. david cameron travels to brussels today to advanced britain's mentorship in the european union, he will outline his proposals including plans to protect the uk's sovereignty when he speaks to european leaders at a dinner.

the government has pledged to hold a referendum over britain's emergent in the you by the end of 2017. here's a look at equity market and where we expect them to open for thursday. a glance to the size suggests we will be opening weaker in the equity markets. factoring in here, the greek story, add to that some interesting comments from goldman sachs. that takes us to our twitter question, goldman sachs president says the markets are less ready for a fed list often people think. lena has stayed with us longer than we are sanctioned to give us thoughts on the fed. what do you think of these comments? do you think investors will be taken by surprise when we see a liftoff from the fed? lena: absolutely. we have had so far, i think this

will be the most important thing in the second half of the year the markets have been busted by the risks of greece, reduce bond markets, and currency wars. what we are going to get any second half of the year is the markets moving to a pricing a stark shift in the waiting fed mount -- manages the balance sheet since 2008 2009, edges moving back. even before the first rate hike is delivered, the fed will have to tighten overnight liquidity in order to be able to lift these currencies towards the upper end. that means a huge liquidity drain, permanent liquidity train. -- drain. central banks come into the markets in order to manage the most -- conditions in the

market. in this case this will happen by draining liquidity. anna: i >> reminder of how it works when a essential bank tries to implement a increase in interest rates in the market. 2006 seems like a long time ago. the inflation environment, does that mean we'll see the fed and the tension in greece elsewhere? does that mean the fed will be on paul's longer? -- on ponds longer -- pause longer? lena: the important thing to understand is that there is the rate hike risk any pricing market there is also the liquidity risk which is still

being reprised as the result of a fed coming to the market. i do think by september, it will be a high risk policy month. whether we will get a balance sheet restructuring or if the fed will be targeting the upper end of their corridor that is a technical question. important thing is that market risk premium from the u.s. equity markets will have to reflect the fed going forward. anna: thank you. fresh from talks with merkel in berlin, david cameron travels to brussels to continue his renegotiation of the uk's membership of the eu. it is a busy agenda and brussels , as if they did not have enough on their plate with the grease conversations.

-- great conversations. -- greece what can cameron hope to achieve from today? >> not very much. obviously talks will still be dominated by greece he needs to show that he is making progress working at this, and he is engaging in talks. he wants to move things on detachable -- technical stages. the bureaucrats are trying to take over and set out a program. anna: how important is this with a promised referendum? how important is this working dinner? >> when britain and europe, you

have to wonder what the rest of the day has been like. i think that his is chance to set up the agenda for britain. he had a chance to speak to most of his peers and leaders, as a result we are going to know what the sticking points are. anna: as he have enough friends in europe to get his way and push through reforms? >> the danes are traditional allies. the problem is eastern europe. the big question is benefits. the germans and he pulls say this interferes with this idea of freedom of movement, it is discrimination, that will be the issue that will rumble on. anna: what is going to change? we don't know details, do we? what has been already achieved in this process? he has been meeting with a lot of the leaders.

>> he has met both -- most of them, we do not have a list, that is true. if you are negotiating for reform you don't want to set out exactly what you are hoping to achieve. i think things like being knocked out to an ever closing union those have been said. other issues such as improving regulation, cutting red tape, these are things that a lot of countries are willing to agree on. anna: thank you very much. on the possibility of brexit let's turn to the chinese market. the ceo of momo a -- an app --

then what is the background on this? this is not the only company taking business that private. ben: there have always been $20 billion worth of take back bids. momo is interesting because it is a chinese style tender -- tinder. it has been six months since they listed on the u.s. stock exchange. they probably prepared for more than a year for this ipo. the same executive team is taking the company private. it makes people wonder why was a look at the first place. -- why it was public in the first place. anna: are u.s. equity markets not as attractive as they once

were? ben: the u.s. stock market has been good to momo, they're up 28% since their listing. the chinese stock market is doing better. some companies are getting keys in the range of several hundred times. things are calm down a little bit in the last few days, but it is still up a lot. people think the rally will end soon, but companies are trying to do this maneuver of getting back to china before the merry-go-round stops. anna: thank you ray much. -- thank you very much. let's turn our attention to south africa we have first national bank ceo, jack salieri. he talked to us about how south africans feel given the current

economic environment. >> it is tough out there. we read the same media. life is hard. the growth rate in our economy and surrounding countries are struggling. we have had a few bonuses. the oil prices helped. i think the benefits of lower interest rates will help people. the impacts on all increases and rates and electricity increases are seriously making big dents in people's disposable incomes. anna: let's get more from johannesburg. what is the outlook for interest rates and inflation for south africa in the second half of the year? renee: economists surveyed by bloomberg are showing that we will have about a 50 basis point

increase by the end of this year or the first quarter of next. it is slow, but it is on a rising track. in terms of inflation, our international monetary fund expects that south africa start to increase slowly because of inflation we had about 6% into an early next year. a monetary policy committee will be forced to make a decision if we are going to breach the target. anna: can you tell us about other factors can -- that might be affecting consumers? have consumer banks been experiencing bad debt? renee: at this point no. with inflation on the rise consumers are facing higher fuel prices the cost of filling the cars got better at the beginning of the year but we are back to where we were last year. the consumer banks are expecting

that if interest rates go up with inflation, we have electricity costs extra taxes consumers will start having a hard time by the end of the year and into early next year. bad debts should be looking by june next year. anna: thank you very much. as we had to break we wanted to bring you a little bit of a taster of our interview from earlier with martin blessing. this is what he had to say about greece. >> the greek government is in a difficult position the best would be if the greek government and the institutions could agree on a credible path to the future. i think it will be difficult. if there is no agreement, then we will be facing a couple of tough weeks.

if greece or leave the eurozone, that would not be the end of the eurozone, but it would be a tough situation to face. anna: when we come back we will tell you all you need to know about the start of the european equity market trading day. will we see optimism, or despair surrounding the greek talks? join us on the other side of a short break. ♪

anna: welcome back. here are the stories you need to know this morning. alexis tsipras will meet creditors again today in a bid to clinch a new aid package for the country. yesterday's talks ended without a deal. eu officials said they had little progress and little hope in sight. legislation key for barack obama's trade agenda has been approved by the senate.

the 16-38 vote gives the president fast tack authority to negotiate trade deals, it also ends the six-month battle that showed obama working with republicans against his own party members who opposed the bill. david cameron traveled to brussels today with his plans to protect the uk's sovereignty. his conservative government has pledged to hold a referendum over britain's leadership in the eu by the end of 2017. asian stocks slid overnight. david is in hong kong. it seems european equity markets are set to open weaker this morning. david: exactly.

as you can see, it is about 10 minutes before 3:00 p.m. here. we are at the low point of the day. we are seeing absolute thrashing when you look at the shanghai market. i will show you that in just a moment. we are down in the regional benchmark. the tech names of the only bright spots. financials, consumer goods exporters, shipbuilders, even the mining taking hits today. there is a lot of risk obviously. there is a lot of risk, these markets have been beat up. it is understandable while -- whitey funds are pulling out. -- why the funds are pulling out. look at the shanghai, down 4%.

markets were topsy-turvy in the morning. look at the chart, it shows you everything. i thought it was a bit of a sleeper, not the usual gyrations. after the lunch break, huge drop. it was about a 4.5% drop. let me end things and show you what is happening with the major benchmarks. 27 139 down 1%. australia was down 1% in its own session. let me show you what the bond markets are looking at, or when costs on the way up with the exception of south korea. otherwise, money flowing into bonds. yields on the way up in asia, equities down. as we have for the moment --

that is what we have for the moment. anna: david, thank you much. let's continue our conversations about the markets. david had a chart of today's action on the shanghai composition -- comp positive -- composite. despite the moose we have seen in recent sessions we are still up 42% year to date on the shanghai cop as it -- opposite -- composite. howdy see things progressing in china? >> is a worry. despite the growth it is alarmingly in line before nasdaq

came in proper. it has been an anxiety for investors in emerging markets. year to date investors have been withdrawing. that is a fear about what is happening in the chinese market. it is not accept -- accessible to foreign investors. it has been a continued concern about ipm exposure. it will be a concern for the chinese authorities as they continue to keep manufacturing from being self landing. anna: everyone is preoccupied with greece, if they are not they're preoccupied with what the fed is doing when they start increasing interest rate. -- rates. that could have negative impacts.

the taper tantrum from a few years ago was when the fed that of interest rates. talk us through emerging markets. >> there are a few rationales on the equity side it is stretched from an evaluation perspective. investor sentiment has been negative, and less positive than the united states and europe. we look at the currency in local debt what we see since the dollar is strengthening, there has been a weakening in many emerging market currencies. we believe on a relative belt -- value basis. it makes us confident and looking to access these markets at this point. as it relates to the fed, it is a different picture most people's frame of reference is the late 90's.

it was a different financing regime. a lot of hard currency dollar borrowing. today it is more mixed substantial lower -- local borrowing programs we could anticipate some selloffs, but we will think -- we think it will be an opportunity to buy. anna: let's get you up and greece. deal or no deal. equity markets look to be about to open up negative with -- negative this morning. >> i think the consensus coming on -- command was no deal. it is in everyone's interest for there to be a deal. it is a continuation and bring the ship -- revenge of -- bri nkmanship.

alexis tsipras has a mandate to pursue negotiations, at the same time, the greek population clearly wants to remain in the euro. there is a conflict in his position as well as with the authorities. the whip hand has moved to the authorities. the rest of europe has a much bigger firewall around it. anna: thank you very much. that's it for "countdown." later on, lorenzo bini smaghi you don't want to see that you don't want to miss that interview. ♪

mark: good morning and welcome to "on the move." i am mark barton in for jonathan ferro. we are moments away from the start of european trading. let's get straight to your brief. alexis tsipras restarts bailout negotiations with lagarde, draghi and juncker. stocks indicate a lower european output. dollar strength hits h&m that is what we're watching today.

a second day of decline after four days of gains. let's check out what is happening caroline: we are set for a second day of declines. they will be sleep deprived again today. once again, an economy that accounts for less than 2% of the eurozone is dictating global sentiment. we are seeing them follow in unison in terms of correlation. it's the sort of situation -- separation we haven't seen since 2011. the most strong relationship since 2011. greek is back in the forefront of investors mind. clearly risk aversion is back. it is happening in the euro as well. the euro