quarter. tell a what you think about our top stories. follow me on twitter. they look after the markets and now. --eed, it is reporter: it is worth looking at. it is down about 37.5%. the shanghai composite is not even a correction but more of a crash. we are seeing more weakness in china. parent back a little bit of the losses of this morning -- parent back a little bit of the lost this morning and you can see. some other major players. -- paring back a little of the losses this morning and you can see.

certainly limiting the losses somewhat. china in newh from york overnight. impacting once again and putting fear. in hong kong, the hang seng from the big day yesterday. up by 0.5%. inre have been two ipo's hong kong this morning. 4.5% in the equity research firm moving. it was falling quite heavily at it is down a by about 10% as of the moment. in australia, interest rates and we are seeing gains coming through from the asx for you 1.8% -- from the asx. -- it is 1.8%. not really impacting the miners in australia.

samsung in korea, unchanged. it was rising earlier. health stocks impacting. rishaad: indeed, it is about shanghai. it is a serious concern for millions ofers area ordinary investors are losing their money. a better picture of the financial fallout but what about the political follow-up. stephen engle is there. , al me, a lot of talk correction taking place. how can the politicians camera what -- politicians, what can they do about it? stephen: is a habit trying to do a lot of things. as have been remarkably quiet. -- they have been trying to do a lot of things. -- they have been remarkably quiet. the number of different measures in the market as we are seeing right now continuing to go down despite yesterday's brief

respite. been down at it has 20% and the last five sessions. , a securities firm saying more measures are probably necessary to avoid basically a market failure. but he adds it is difficult to manage such a gigantic ecosystem like the chinese stock market. the government in his estimation learning the raw forces the hard way. huge challenge for xi jinping. state media helping to cheerlead the stock rally up and authorities rolled off favorable policies for individuals to invest in stocks. it is kind a heart for the rally to take credit for the rally. of for the responsibility the crash if that is what we want to call it. restore is to

confidence and the word with been getting from state media. and we need confidence. confidence of quarter to the people's daily is more valuable than gold. if the probably expect selloff continues, more policy measures to help prop up the market as the political leaders here in beijing. rishaad: thank you. stephen engle. let's talk about the other big story for the week. eurozone leaders meeting for emergency talks to court made a response to the greek referendum for prime minister alexis tsipras sat his home as history event. other signaled their patient is rapidly running out. -- prime minister alexis tsipras said his hand is strengthening. zeb: the patient's of the french -- patience of the frigid delegations wearing t -- french delegation wearing thin.

angela merkel speaking yesterday with the french president in france in paris saying mr. tsipras, time is running out. it is decision time. the finest mr., yanis varoufakis, mobbed yesterday because -- and the finance minister, yanis varoufakis, monti yesterday because he is no longer in the job. side to thesofter europeans. a lot of concern about his negotiating style so he stepped down. replacing him is a less combative hearse and. interesting to see this in terms of the finance minister post. -- replace it was a less competitive person. meantime angela merkel speaking sherance and list the way

had to say. she is taking a hard line with the greece. time is running out. where emphasizing such proposals need to be made this week in order to resolve the situation as it is now. and as the french president said , as for us will a european principle. -- francois hollande said, a french principle. our last offer in the negotiations was a generous offer. in these kinds of challenges, the refugees, europe can only keep strong and sends together is every country assumes responsibility. ever the statesman, a diplomatic tone. behind the scenes, there is a lot a frustration about how things have turned out. the result of the referendum and now of the referendum and now the own his own prime minister singh for to score a deal --

tsipras to score a deal. rishaad: thank you. which is one maker of the missing from the last several quarters. yvonne: sam's -- samsung missing estimates thanks to the weaker smartphone sells because of a lack of demand ball more supply issue. production constraints for the s 6 edge model. demanduse of a lack of but also more on the supply side. had a lot of early praise as the phone that could win back customers that went to the iphone. some analysts say expectations were just too much. a downturn in the smartphones

may possibly hurt profit for the growing chips and displays business. morgan stanley expects office -- offers will pick up in the second half. speaking gus smartphones, -- speaking of smartphones, and the shadows of samsung and apple, sales were down more than 50% from last year. expecting $1.12 billion. the loss was not as big as anticipated. 160 million.was htc has a focus on premium and midpriced phones for going low end to preserve its brand. a price for that move. 9new flagship 1 and struggling against apple and samsung. facebook'sberg, chief operator, has joined the

board of surveymonkey. it was the business that her husband ran until his untimely death in may. she said she watched her husband and hopes to realize his vision of building a lasting company. in 2009. surveymonkey they met in identity six when that were working in l.a. david everson joined the online polling company as well. back to you. program,later in the asian phone makers. you heard about one of them hit by weaker sales. handset. what will it take? doom and gloom and mainland. a very different scenario. finding out why. "trending business" returns in a

couple of minutes. ♪

zeb: a check of stories around the world. a deal on iran's nuclear program is in within reaches said one person. want anplus germany agreement following an inspection of iran's nuclear site for the return of lifting sanctions. deadline expires later today. a rejection of arbitration to resolve the long-standing feud over i was disputed by the philippines and the south china sea. willternational tribunal look at the chinese argument that there is not authority.

beijing salmonella should discuss -- beijing said manila should discuss. a jointed shrill in the training forces to work together to support potential military action. 2000 soldiers took place which involved the building of landing facilities on the coast and installation of buildup. it was designed to improve logistics between the armies. rishaad: it does been all about chinese stocks. , signs ofuest optimism as the equity markets in china and hong kong may see a rebound later this month. equity strategist with ecb national. mark with me now. selloff willk the find a natural flow at some point. what were looking at is major

deleveraging. rishaad: quite different this time with the whole market situation. wrote arrect when we report, it was quite obvious are around may or june, the margin would peak. what we're really seeing here is a natural correction which has been exacerbated by this margin. tends to happen, you overshoot on the upside and the downside. are we getting that or something deeper? mark jolley: i do not think there's anything deeper pretty still aggressive monetary easing underway in china. if you look in the asian market and underlying cash flow experience has improved and continues to improve. we have a lot of reform which is changing the asset base. the problem is a dramatic buildup of leverage that needs

to work itself out. in one sense, the market will find. rishaad: how does it work its way out is the thing. ce we get to the base we were at in january february, all of the leverage coming to the market since the beginning of the year will be out. at that point, you will find it will be much easier for the government to support markets. worth has3.2 trillion been wiped out of chinese equities since the peak on june 12. how much further can or will the government let this fall? the government is getting increasingly nervous as you can tell. mark jolley: one of the problems is is the broader market. if you look at the hong kong 15 stockse largest represent more than 50% off market cap.

and the asian market, market cap is very broad. purely buying stocks will not hold. in terms of that kind of strategy, not much they can do. otheran continue with monetary measures. they can inject liquidity into the market. be stirringa could problems politically down the road and that is the danger. would have: normally a big market selloff, you get a big house afterwards. three or four weeks now if we are sitting together -- rishaad: i will hold you to it. mark jolley: there will be a big verye and then that is a good time to be selling because there are other problems in the world economy besides what is happening. rishaad: not adjust china, from hong kong on this side and you are saying with the global markets do for an overcorrection, too.

mark jolley: what we are seeing china is an overcorrection. rishaad: is it a crash? mark jolley: sure, it is a crash. a pretty major event. rishaad: the so-called capitulation phase. ark jolley: i think we have people are wondering if they can stop the decline. markets will always find their feet. the valuations are not outstretched anymore. the policy environment in china is very supportive. i do think a year from now the equity market will not -- will be significantly higher. the problem between now and the middle of this past year is the increase in bond yields. that increase is threatened by what is happening in greece. on our estimate, the increase in the global cause the capital and

the fact we are very laid-back and this expansion is going to cause a reduction in risk appetite. get --: mark, i went to you are seeing light at the end of the tunnel. china property. mark jolley: in terms of the property market, i will take of the property market is this is pretty well advanced in tier one and tier two cities. price increases there. is starting toy take hold in the main cities. it will be a 2 tier markets. you look at the property stocks, people are of the view they will not recover for a long time. our view is the property market is already recovering. part of the liberalization we are seeing in china, chinese banks have a pretty small proportion of loadable --

logbooks allocated compared to most other countries. a lot of things that will occur over the next couple of quarters that will start to reinforce the idea there is a recovery. rishaad: ok, you like insurance. mark jolley: i like insurance very much. first of all -- rishaad: are chinese underinsured? mark jolley: it is so low for the highest savings rate in the world. a pilot program as of the moment that protects health insurance. with financial liberalization you will find the shores will be more sophisticated and higher products. quickly,ishaad: very discretionary? mark jolley: consumer discretionary, underweight. it has a lot of headwind. is slowing.omy you really want to be weighted

toward sectors with structural growth not structural slow down. also the whole correct, the distribution channel system coming from e-commerce, not a lot of bright spots from consumers. rishaad: e-commerce? mark jolley: overweight. rishaad: thank you. mark jolley from ccb. calling for the removal of reddit's ellen pao. right after this break. ♪

rishaad: this is "trending business." what is trending on social media. roberta vinci are talking about ellen pao -- reporter: we are talking about ellen pao, reddit's cl. she issued an apology after she went through a lot of outrage after firing victoria tyler. they did not discuss why. she has faced a lot of criticism, ellen pao, over how she is manage and lead this site. because taylor, she was head of this ask me anything seed and there was -- feed and there was

accusation there were problems like racial last week and ellen thatid not like it at much. a lot of users and moderators shut down their pages. over 300 discussion areas in protest with their frustration over the site and an online petition. have signed0 people asking for her to resign. some say they are in full damage control mode now. other users saying, we need to know the context of this all. it seems in the reddit community has been undergoing transition for a while. we talked about this as big as no other site where you can talk about anything. there's this is a different issues on the site. zeb: certainly, reprehensible comments made they need to be dealt with. the larger issue from the business standpoint, if you

build your business on openness, transparency and allowing people to express themselves, you are censoring secretly -- you have no consumer trust. yvonne: they have not said why they dismiss the director of talent. that can be what people are looking for. speaking of clarity, we will be up to choose our own burgers now at a mcdonald's. zeb: are you hungry? yvonne: i could use a burger. zeb: i could use a burger. you can get them at this new mcdonald's, create your taste -- what we call it -- touchscreen. mcdonald's branching out between the cheeseburger, hamburger and big mac. they are level you to customize. it looks high end. look at the latest -- lettuce. there is pineapple.

the reason they are doing this in hong kong and starred in australia because their sales are really in the dumps. they hired a new ceo and trying to change the brand image. ms. bloggers get excited and create your take. who does not love a free gift? from mcdonald's. your own tote bag. mall.n go to -- and the get burgers after this. zeb: see you there. rishaad: wondering where chinese markets may be heading. aren't we all? ♪

with xfinity from comcast you can manage your account anytime, anywhere on any device. just sign into my account to pay bills, manage service appointments and find answers to your questions.

you can even check your connection status on your phone. now it's easier than ever to manage your account. get started at xfinity.com/myaccount rishaad: a look at our top stories. chinese equities falling for the fourth time in five days despite government efforts to shore up technology shares. there are 24 stocks dropping for everyone that is gaining greater analysts -- gaining. analysts say a $20 million brokerage fund is not enough to stem the decline. eurozone leaders meeting to discuss their next steps on greece. angela merkel saying time is running out after the greek

populace voted against the terms of a new bailout bit of alexis tsipras being told he must come up with an incredible plan to stay in the euro. greek banks are set to stay wednesdayil at least to settle the cap withdrawal reservation. seven straight quarters it has fallen shy of forecasts. it operated just over $6 billion for the three months at the end of june. that is blamed on the failure to lurk customers away from the iphone. we have to be looking at this point in the day as to what is happening with japanese equity. >> we are seeing a lot of steam coming back into the market. what is holding up the shanghai composite this morning, or limiting those gains?

it is the large-cap stock. that the central bank liquidity problem is there. goodof china has been a performer today. companies andp tech stocks that had the big run-up before june 12, which is where a lot of chinese investors have their money and that is where we are saying the weaknesses. they are down by about 10%. interestingly in hong kong, patrol in china shares are lower there. great games coming through on the asx 200. -- it is at 1.7%. in japan we are seeing a comeback from yesterday's selloff. investors searching for

more perspective on china's stock plunge and bloomberg intelligence has identified 2009 as a relevant period to revisit. research inhead of asia for tim craig. let's get over to tom first with why might investors want to take another look at what happened some six years ago. tom: we are underpinning what happens in the stock market is what is happening in the real economy. i think if you make that comparison between what is happening in the economy in 2015 at what was happening in 2009 during the financial crisis, there are a couple of pretty worrying takeaways. if you look at gdp growth, gdp growth in the first half of 2015 has been almost as we guess it

was in the first half of -- almost as weak as it was in the first half of 2009. if you are open that and look at drivers of weakness, there are commonalities. now as then we had weak exports. now as then we had weak real estate. what is worrying is the drivers of weakness in those two sectors look more systemic, more difficult to solve in 2015 than they did in 2009. on export spec in 2009 it was really the global crisis that was the problem for china. when global demand came back, china's exports recovered. in 2015 it is a lot more competitive in china. are a cause of the problem and that will not go away. rishaad: in 2009, why does

consent -consensus expected to be more muted going into this year compared to next? tim: i think it is partly because the causes of weakness in 2015 are much more structural. thentioned the exports, real estate sector, there is a seat in oversupply problem -- a significant oversupply problem. we are expecting that to pass .hrough those constructions we look at the banking sector. in 2009 it was the surging credit from the banks that propelled the economy. though we have had a series of rate cuts by central bank, banks have not really started lending again. that is because after many years of stimulus the banks are a little overstretched. for all of these reasons we are not expecting a repeat of the

v-shaped recovery we saw in 2009. the best case scenario in 2015 and heading into 2016 is stabilization and the current, rather modest growth levels. rishaad: i'm going to bring tim in. how did all of this play out with stocks? is there a read through for the equity market? tim: rish, it's pretty fascinating. there are lots of comparisons being thrown around for the stock market in china as it 1929,s to whether it is 2006, 2007, and the bust. in comparison to 2009 it is quite interesting. in both situations following stimulus activity we saw a rise in the equity market rate in 2009 over the course of seven or eight months, it was up about 90%. this time around, if you go back to november when the anticipation of the stock in an

stimulus, monetary easing started to come through, we were then both0% and markets to collapsed. in 2009, over 20%. we are down this year. 29%. better second a half. the $64,000 question now, does this happen once we find some mode of stability? one of the differences between then and now is the explosion in margin debt. we have explored that to some degree, looking at free float as opposed to market cap as an underlying comparison. we have a lot to unwind. we are running between 6.5% and 7% in margin debt compared to free float and with flighty retail-oriented investors, the leverage is cutting both way.

it helped propel the rally and now it is an obstacle to finding stability. at some point that will come back into normality. rishaad: thanks so much. tim craig and tom orlik joining us from beijing. some of the other stories. china has nominated his former world bank representative to the head of the infrastructure asian bank. secretary general of theaaib. is a former advising chairman. us as g.m.'s -- china may overtake as gm's most lucrative market over the u.s. automakers are struggling in china.

the slowdown and stock market growth continues. bestakers are enjoying the 10 months in the last 10 years. wasls not seen before it pegged to the dollar 10 years ago. an investigation into the prime minister by finances is driving that decline. there are allegations he misused millions of dollars of state funds. we have two big asian phone makers delivering some wrong numbers. samsung and htc starting out weaker sales. samsung us estimates and operating retail was down for a seventh straight quarter. is say about the state of the samsung mobile business?

rob: what it tells us about the business is it is struggling. samsung unveiled the galaxy s6 models at the start of the quarter that just finished, the start of april. they had two models, the s6 and s6 edge. they figured it would be a good answer to apple's iphone 6. the s6 is only enjoying tepid demand and they got wrong some of the man they expected for the s6 edge with a curved screen. they had some success with a model they were not prepared for and the one they expected to sell more is finding stagnant demand for that s6 because people are choosing to stick with the iphone. they got the mix wrong with what they were trying to do with their high-end smartphones and the chinese produces their tech at the bottom and bank. that problem has not gone away for samsung.

rishaad: how does it recapture growth and earnings? what is next for the company? rob: there's a couple of things on the horizon. they got the note. samsung is one of the pioneers of a large screen device. they had the note, which is about 5.7 inches, which is what apple's iphone 6 plus sought to capture and did well. there is a new note due out later this year. expectations with curved screen have aogy needs it could technology edge over its rival. what they are trying to do is add new models to the smartphone business and add more services. paying to give them more of a business model that can compete with apple. at the moment, the fragmented approach is not really working for them. rishaad: robin joining us from melbourne.

let's do all things htc. also under pressure. market share being eaten up by rivals. struggling to find the right market response. they have tried all sorts of thing. an" lasttried "iron m year. we talked about samsung struggling against apple. htc is struggling against first-your smart phone makers. profits over turn the last four quarters. we know that it's actually in the red. we are looking at these unorthodox numbers for the second quarter we have a graphic that shows you that sales were down more than 15% from the second quarter of last year. 18% from the first quarter. just underloss of $170 million u.s.

the stoxx are trading. rish, look at that. it is almost trading at the less level. --is below the book now you book fell you -- book value out there. rishaad: investors love it. david: they slashed that number almost in half, from 136, they brought the price down to 70. it shows you what is the focus of the company. you are looking at the competitive landscape. they did not want to get into the low-end spectrum of the market because that is where you have thinner margin, price wars. they are absolutely getting killed when it comes to the medium and high-and bank part of thepart of-and

market. rishaad: it is a vicious battle out there. htc was known as the high tech computer corporation. needs to provide serious, credible proposals if it wants to stay in the euro. ♪

now for a check of headlines around the world. at least 12 people were killed when an iraqi air force plane accident he dropped a bomb on eight baghdad neighborhood.

25 others were wounded. the plane was returning to base from northern iraq with the military is fighting the so-called islamic state group. football governing body has banned a senior executive for seven years over the allocation of the world cup to qatar and russia. he oversaw the fitting process and 2022016 competitions. nichols warned that qatar would be too hot for a world cup and intends to appeal his band. thai customs official have seized 250 kilos of ivory headed from africa to asia. it was a shipment of about 130 tons. other fragment was tracked from cargo after tebow. the ivory is valued at almost $300,000 and is the 11th such seizure made this year.

rishaad: greece will need to provide credible solutions to stay in the eurozone. grexit has been discussed but john hannah says that it's too it to be considered. the pressure is on the greek prime minister alexis tsipras, is it not? john: of course it is. some of that pressure is is because of the referendum greeks voted on sunday that was a no, increase an effort to the negotiating power of greece and we will see of that works. rishaad: how important will type's meeting be in brussels -- will tonight's meeting be in brussels? don: it will be very important.

it is a signal from the other side from the europeans, the creditors, as to whether they are willing to sit down again and work out a deal. rishaad: alexis tsipras -- as his hand been strengthened? don: certainly what it has done is created a backing within greece for the idea that greece should get a better deal. from his standpoint, his standing within greece is clearly stronger. what we will find out in the next day is as a result, the ability for him to get a deal better for greece has also been strengthened. that is the uncertainty. you have a divide within the europeans as to whether post this referendum was essentially the greek saying we do not want to be part of the euro, therefore european leaders say they should go. others say, no, grexit is still to uncertain and costly and we

should negotiate a deal and we should get that issue behind us. rishaad: the hand may have been strengthened there. going to the other point, he may be able to grip his cards tightly. what cards does he have to play? don: what he has got to play is essentially, again, the standpoint of whether the uncertainty that a greek exit would entail for the rest of europe. that is one. there is something on the order of 3 billion euros that would go poof in the failure to reach a deal. it is not as large as the cost associated with the lehman event, which lost more than double that. it is still a significant amount of losses for european taxpayers. on top of the cost associated with the default. you have the uncertainty that that would create within the

eurozone about the euro itself because essentially you would have a country that is more likely than not to exit the euro, meaning that the irrevocability of the euro would be in question, leaving questions for the spanish, the portuguese, the italians going forward and the rest of europe would have to essentially spend more money to ensure there was better fiscal union, better banking union. that would be costly. there is a geopolitical cost associated with kicking greece at the euro, which themselves are uncertain. there are lots of issues that complicate the decision by the europeans and why we still think there is a likelihood in the next few days you will get an agreement. rishaad: the point is, and i spoke about this, that he did not see much of a gap between the two side. what he did say, and this is

something that cannot be addressed in one meeting, was the ultimate and complete breakdown in trust. how do you feel about that? case that clearly the the process of negotiation year an been -- here has been extremely debilitating one at the personal level for the leaders involved. in particular, the decision to go to a referendum went from the standpoint of the europeans, we thought we are nearly at an agreement. just a few more inches and we will be together in the same place, to call the , and they catch a backhand from the greeks which is damaged the ability of the europeans to trust them. beenof that has alexis tsipras asking for the

resignation of his former finance minister and the joint statement asked for by president francois hollande that was signed by the major political parties in greece that they are behind reaching an agreement, because part of the lack of trust is not just a loss of personal connection, but also a sense that implementation of any deal won't go forward. by having a commitment from a broad array of greek political party's, you have a chance that you will get a deal implement a bit of rishaad: great -- deal implemented. rishaad: great talking to you. don hanna. this is bloomberg. you are watching "trending business." ♪

rishaad: let's have a look at

what has been trending today. here is he gone -- here is you'vyvonne. yvonne: the moderators of reddit protesting, blacking out over 300 parts of the site. it is unclear why she was dismissed. she was the facilitator of the ask me anything fee. there is a petition for ellen pao to quit. if reddit saying, compromises content by moderators, not because i care, but because i don't care. pao has faced a lot of harassment in the last couple of years over some of the decisions she has made when it comes to

orship on the site. rish, we send it back to you. is the break.g up on the other side of it is "asia edge." i will be joined by angie. ♪

heidi: i am heidi. mark: and i am mark halperin and with all due respect to clinton staffers, you missed an awesome opportunity for ring around the rosie. on the show tonight, hillary's rope and christie's hope, but first the donald says nope. 883 words in our inbox before we go on the air. ngth commentryle from the donald