caroline: shanghai swings. chinese stocks are volatile as the government continues to struggle to restore market confidence banning major marketers from showing. -- from selling. russia is to pull together a plan to keep the crisis nation in the euro ahead of the midnight deadline. and central banks contagion concerns. optimism on the u.s. economy undercut by caution in greece and china. at the bank of england rate decision today will consider what governor carney has called the q2 greek risk. -- called acute greek risk.

welcome to "countdown." it's 6:00 in london. another day, another story out of china -- let's start with the chinese equity markets. this is a picture of the shanghai composition, your today. -- shanghai compensate, your ear to date. what have we lost so far on this chinese market? we have lost $3.9 trillion worth of value in less than a month. such is the level of trading halts we are seeing on the chinese market. the latest government headline is being described as "an act of desperation." let's talk about the u.s. equity markets -- a number of issues. we saw the u.s. equity markets fully open for the last hour of trading. the nyse suffered a three-hour

trading hold because of the software update. other trading was open all the way through the afternoon session. still, amazing developments -- we will come back to that. the fact that we saw the fed concerned about greece in china, that weighed on stocks. let's talk a little bit about what happened in the asian session today. china's stocks are up and trading and volatile in today's session. let's get to juliet sally and stephen engle's and sang high -- in shanghai. juliet: as you mentioned, it has been really volatile in the asian region today. the shanghai is coming back 1% higher following the last break. it is up 2.4% currently on the shanghai composite, and i

want to show you how wild these swings have been so far today. we opened in negative territory and we saw the seller starting to come through, but all these efforts to try and stand these equity routes had the markets frozen in liquidity measures being pumped through. what else is helping is that we've seen a rebound in commodity prices, particularly copper. that has been helping some of the equity as well. there has been a big focus on hang seng up by 3.8%, a very good rebound. yesterday, the hang seng hit its lowest level since 2009. we see some great games coming through -- the hong kong exchanges up 10.4%. worth keeping in mind is a strong typhoon bearing down on hong kong. the market will be closed

tomorrow if that typhoon gets to a category 10. looking at some of the stocks weighing on the hang seng it still has china mainland shares bank of communication shares and it is also quite week on the shanghai market. the other big story of the day -- we were speaking yesterday how it had fallen below 50 u.s. dollars and it is down 10% in china yesterday. that has been impacting on mining stocks in japan and australia, but it looks like it will be coming back to support the asx 200. a downgrade for korea coming today. encouraging signs -- the nikkei is still extending that 15 month decline. certainly, anna, much more encouraging than what we were looking at yesterday -- a lot more buying.

anna: thank you very much. to bring you up-to-date with breaking news -- honda is adding 4.5 million cars to its recalls involving toakata airbags in addition to an existing program. that includes 1.30 6 million vehicles -- 13..36 million vehicles. these can rupture and spray metal and plastic at passengers. let's get back to that broader story around china. stephen engle is watching things in shanghai. they are trying to impose order on a pretty unruly market. it was called and asked of desperation and ubs says they are extreme -- what do you make of it?

stephen: the desperation is "shows that it adds fear to the market." they are trying to get their hands back on the steering wheel, if you will. it has been a tough ride obviously, and they have had a number of different administrative measures to try to pump the back liquidity into the market, and also confidence -- that is what has been sorely missing. i just took a very brief lunch break and ran into the head of the major european brokerage securities firm. he just got off the phone with his traders, and they told him they are breathing a little bit easier this morning because there seems to be a bit more liquidity in the market because of the government moves. that is what we have seen -- we have seen a floor being put, it back stop being put on all the selling over the last few days, nearly $4 trillion wiped away in a matter of weeks now. the latest move is from the

securities regulator -- they have been out almost every single night. they are banning major shareholders, company executives, directors on the boards from selling listed company shares for at least six months. any investors that have a stake above 5%, they must maintain their position. this is supposedly a calming move, and also keep liquidity in the market, but as you said, some have been very critical allowing half the market to halt trading as they are trying to find this floor. anna: jack lew has been urging beijing to continue opening up the economy in many ways including this one. let's talk about inflation though, stephen. the estimates are out this morning. perhaps that will be undermined

by what we are seeing in the chinese equity market? stephen: when i saw the headline -- it depends on how you spin the story. 1.4% rise in inflation does not sound like an overheating of the economy. what it is is that it is showing that the for rate cuts we've had since november -- it is starting to fade into the economy. one point 4% was higher than the consensus estimate of 1.3%. keep in mind, this is still below half the government's full-year target. another thing we need to keep an ion is pti wholesale prices. they continue to fall in deflation now for 40 straight months -- more than three years -- and it got worse last month exacerbated by the commodity price that was exacerbated because of the equity route

contagion in steel, copper, iron ore. there is definitely deflationary pressure at the factory gate and that kind of raises real interest rates, which goes against what china is trying to do and that is soak some growth. anna: stephen, thank you. a gift from the chinese to other parts of the world. thank you very much. that takes us nicely onto our question -- do you think that the latest rules to come out of china, are they a necessary tool to calm the market or are they " an act of desperation?" have your say, get involved. greece faces a midnight deadline to come up with economic reforms that unlock a new bailout from european creditors. capital controls are still in

effect, and greek banks are still closed. ecb's drip feeding emergency funds to lenders. guy johnson visit athens. can suppress make the midnight deadline? dash cam tsipras -- guy: yesterday we saw the formal letter to the esm -- the application is now in and that we have to come up with the details, and we have until midnight brussels time tonight before we get that. so what are we looking for? remember this is a three-year deal they are applying for -- this isn't just a back in, it is a whole new program. in the words of mr. tsipras it will be comprehensive and specific.

they are being done at an incredibly short period of time. normally it takes weeks or months to get this done -- we are going to be doing it in 24 hours. so what do we think we in there? there will be a lot of changes on pension a lot of changes on the taxation system. will there be any application for debt restructuring? the u.s. was involved in the story yesterday, jack lew talking about how the greece needs some debt restructuring. he is putting pressure on the other side of the story. the have until midnight tonight. then we get that story restored and it then goes into the eurogroup and to the leaders on sunday. it was said yesterday that this was part of the process. today we are getting details of the specifics surrounding the application, then we get it scored then he goes to the eurogroup.

that is how the process will work over the next few hours in today's -- very, very quick. we do have a starting point -- some of the proposals from the existing applications -- it is a blank piece of paper. anna: meanwhile, the banks and greece remain closed, guy. guy: they certainly do. the credit controls very much continue, probably affecting individuals less than it is the corporations. some parts of the economy have a lot of cash and some have no cash. the companies -- the ecb met yesterday, the ela was maintained. they will meet again on monday post all of this procedure surrounding the bailout. it will allow liquidity back into the system.

there is a lot of talk swirling around athens about mergers, banks. they are short on capital and liquidity. there is also talk about the ecb asking leaders to guarantee the collateral. as a result of the ela. that would maybe give the ecb a little bit more cover. a lot of things happening, and an awful lot of things happening surrounding this application. anna: die, thank you. hans what are we hearing from greece's creditors this sunday morning? good morning. hans: some creditors are willing to talk quite openly about the debt -- the imf has their stated position. jack lew became an ally of sippers yesterday when he said -- ally of sick sitt sipras yesterday.

the timing of it was significant -- have a listen. >> we have always advised that the program walk on two legs, if you will. one leg is about significant reforms and fiscal consolidation as we have advised in the case of portugal tsipras, latvia, iceland and it has worked. the other leg's debt restructuring, which we believe is needed in this particular case for it to have debt sustainability. hans: lagarde also pledged to be involved in any additional bailouts. mr. tsipras was in strasburg yesterday, and has been raging against austerity.

at the same time he is really against austerity, he said this letter -- it is significant that it was a three-year request. before it was always a two-year request. he talked about how he wanted to implement these measures almost immediately, as early as next week. he did hint that he is going to require debt sustainability, some debt restructuring. he put it in presley friendly terms -- this was in demanding. he said the opportunity to discuss debt sustainability. we heard some people saying they wanted to hear the specifics but are interested. chancellor merkel was in belgrade last night and she said that the situation does not look good. according to the german cover men -- german government they are very skeptical about what they are going to get from greece.

anna: a pattern in strasburg. hans thank you very much. we will take a short break. coming up, the china market meltdown made headlines, but hasn't had any impact on the economy, and if not, how long will that last? ♪

anna: welcome back to "countdown." here are the stories you need to know. it has been yet another volatile session on china's benchmark share index as the government struggles to restore investor confidence. shanghai composite has swung between a 3.8% loss and gain of 5%. more than 1400 companies remain locked down after the market

lost $3.9 trillion in value in less than a month. greece this rushing to pull together a detailed economic package by midnight to convince european leaders that it can stay in the euro. six european leaders have made it clear that alexis tsipras's government has one last chance to present a credible plan. they will meet in brussels on sunday to decide their response to the new proposal. the minutes of the u.s. federal reserve's june meeting seemed to be moving towards condition that would support an interest rate rise all that one policy makers needed to see more evidence of growth. officials also discussed the potential negative impact of greece and china. china's latest shaky move was to ban companies from selling. it is aimed at halting what was described as an unreasonable

plunging prices. bloomberg has been charting the highs and lows in the index. >> shanghai composite has been on the rise of late last year. in february, he got another boost when the reserve ratio requirement of the banks was cut by 50 basis points. the index then continue to rally, and by june 10, as of a further 61% but it stopped short of including china shares in the global barge park. -- global benchmark. by june 24 the cap was scrapped for the banking system. three days later it made another round of cuts to interest rates and reserve ratio requirement, but stocks fell further. to shanghai composite continued to fall, and ipos were suspended. major brokers launched a fund

and the government announced further liquidity support. nearly half of the listed companies in china suspended trading. china is seeking more than $18 billion to shore up the market. two hours later, it announced that it would be extending its credit. firms were told not to sell their shares. anna: let's bring us up-to-date on that story. we have the head of rbc to discuss the latest out of china. what do you make of these latest moves by the chinese authority? anybody who owns more than 5% of a stock is not allowed to sell it. it was called an act of desperation. ubs call that extreme. how you view these actions? daniel: i would like to think about the story going back to

the beginning of 2014. the reason is because that is when rates peaked and started to decline. all that liquidity started to move away from fixed income instruments into stocks. anna: the government wanted big businesses to find something in the equity market. daniel: it is really a process that went out of control to some extent, in the second quarter of the year. what melts up melts down, and we have seen this in the past in several other stock markets in the world. anna: more like surging, wasn't it? what do you think was the trigger, then, for this retrenchment that we are seeing, this correction and chinese stocks? the report suggested that perhaps the decision not to include china in the benchmark

index -- that open people's' eyes once more to china not being quite in the international fold, that it's still a market with special characteristics? daniel: i agree 100%. there were two reasons behind it. the first was what is the next pocket of demand coming for? chinese local stock market. with that pocket disappearing investors were wondering who was going to be the next one to buy stocks. the second one is how low interest rates can go. they dropped from 5% to 2%. the question is how much lower this can go. once you combine those two things, it triggered investors -- let's wait and see what's next. anna: are you expecting that the central bank will keep taking actions to try activity in the real economy and stock market by cutting interest rates? daniel: definitely.

anna: they will have to worry about inflation. daniel: it is quite high -- depending -- let's say you take the seven-day repo. inflation is 1.5%. compared to the u.s. where rates are zero and inflation is .5% -- there is room, cushion to add some liquidity. anna: how much do you think it is -- yesterday, i saw signals from the options market, showing us that china ousted russia as the riskiest market. and there is a lot of risk attached to russia right now with their foreign-policy. that strikes the is quite amazing, that they handed that the tom. [laughter] daniel: it depends on what markets you think are risky. the fixed income market in china

has been remarkably stable. the currency has been very stable, compared to the russian ruble. that on the other hand, stocks have been quite volatile. that really depends on what combination -- anna: the currency is pegged isn't it? daniel: it floats within a band of about 1.5%, so it is compared to the euro. anna: will that be maintained? a lot of people have raised that as a question. daniel: if we do believe there is room for a widening of that band and the reason is the fcr reviewed -- anna: ok. thank you so much, daniel. we will take a short break here on "countdown." all talk may be of greg said but what about a brexit?

it will be something of a talking point as we approach 2016. we talked to a man who thinks british business is better off out then in oven unreformed eu. that is coming up later. ♪

anna: welcome back to "countdown." 6:30 here in london. you are the stories you need to know. another volatile session in china as the government struggles to risk restore investor confidence. they have swung between 83.5% lost in a gain of 5%. companies remain locked out of trading as the market left $3.9 trillion of value in less than a month. the bank of england will make its latest policy announcement at midday u.k. time, with what mark carney calls the acute

greek risk. they will also have to weigh the impact of the budget, announced yesterday. economists estimate it will keep its rate. the minutes of the u.s. fed meeting saw the biggest economy moving toward conditions that would support of interest rate rise. of policy makers said they needed to see more evidence of growth. officials also voiced concern about the negative impact from greece and china. let's stay with the story of the fed. phil mattingly breaks down the details. phil: the federal reserve officials in june expressed caution about global economic headwinds, saying it was on the path for an increased interest rate. they said that economic conditions as they currently stand are headed in that direction, according to the

federal reserve minutes released from the june 16-17 meeting. those minutes also pointed out that china and degrees are contributing heavily to global headwind. for types of headwind that have only grown worse in recent weeks since those meetings occurred. they also pointed to problems domestically, most notably in consumer spending. all the officials hinted at the possibility that perhaps they were undershooting where u.s. economic statistics were. when it came to inflation, all officials agree that they are still well below the 2% target. still, they expect gradually to head toward that target. all this comes as greece and its creditors are still at a standoff over that country's economic future, and china faces its own market drought. a clear picture may come later in the week. janet yellen is expected to speak on the u.s. economy in cleveland on july 10. back to you. anna: phil mattingly there.

let's return to europe. while european politicians are fixated on greece and the possibility of a grexit, there is a long way to a referendum on the british referendum for a nexen. -- four and eight said. john moynahan is joining us now. thank you for coming. let's get your thoughts on the possibility of britain leaving europe. to have set out what you call the 10 commandments -- the reforms you want to see it in europe. have you made up your mind already? have you set the bar so high that you will not reform and therefore you are essentially calling for a brexit? john: right now, unfortunately, david cameron is quite low, and in his discussions with europe over the past couple weeks, it

essentially says that he is going to lobby for us to stay within europe, whatever happens. we, on the other hand, do see a set of opportunities where we could stay in europe which essentially boils down to being the common market that we asked to join in on the political union, which we find we've now been pulled into. this book that is going to be launched in about -- on monday -- anna: it is more than a book, it is enormous. jonathan: it is considered the reference book to cap consider what would happen if britain were to leave europe. it has everything from banking to fisheries to diplomacy -- every single facet of what would happen if we were to leave your. -- lead europe. we can now say conclusively that the worst option is that we stay

as we are, tied to a doomed economy. virtually the only large part of the world that is not growing. the two good options are a change in our relationship with europe which we think would benefit europe, as well. for, if we don't get that change, we change back to a trading relationship rather than a political union. if we don't get that, then we are much better off out that we are in the current relationship. anna: lusted things -- lots of things to pick up on. it suggested that britain'sons want to stay in. jonathan: the people we represent we believe has been on the right side of the argument forever, who didn't want to join the euro. people are saying it is much too scary to leave europe -- anna: tell us who you are working with on this project.

jonathan: we have got something like 1500 signatures that were published in newspapers of ceos of companies all over the u.k. they tend to be the middle size entrepreneurial companies, not bigger companies. cbi has always campaigned to be in the euro, is campaigning to stay in europe it has always been on the wrong side of the argument, representing the large corporatists. but we believe, for example like your viewers, people on the treadmill watching this now before they go to work -- they are fed up with europe. some of their bosses have been thinking that they've been told that the line is always going to be scared of leaving europe and bit by bit, that is changing. there was news yesterday of a changing of the guard at

barclays. they are talking about hsbc. you are seeing the leadership being taken over by sensible people finally who are all beginning to think -- well no this europe thing has been a bad idea and has constrained us on the global stage. it shows how it is much more important to take advantage of global opportunities rather than focusing on a declining market. anna: you go through a lot of detail on your recommendations. one of them is around migration. your experience -- you consulted for many years, and surely businesses want easy access to global talents. that is the kind of benefits that europe can bring. jonathan: and that can get -- and from leaving europe. companies are not able to bring

in people from around the world because of the access by europe -- if you take it from around the world and from europe you have too many people coming in. there are constraints on granting visas, for australia from america. if we changed our relationship with europe, the city and other places would be able to bring in far more talent. a anna: when i look at your 10 commandments i go back to my first western about whether you are setting the bar too high. you talk about exempting from the union, which summit you -- which some in europe are concerned about control over social equality about all kinds of -- inand and the ability to negotiate trade.

it doesn't sound very feasible. jonathan: that is the message that people are trying to give -- it is all far too scary to look at what has happened. every time they say no, they give another concession. greases going to end in disaster -- greece is going to end in disaster. and who knows what happens after that. but as far as europe's willingness to negotiate with them, we feel that right now david cameron -- but he has done is put up a minimal set of demands and said let's have a quick referendum in april 2016 which is way too early, which is why we've come out with this book as quickly as we can in order to show that the arguments -- he has been far too

minimal. if you are much more aggressive we think europe will be desperate to keep us in, and they will change the negotiating stance very dramatically. back to where we were when we joined the euro. anna: plenty more to talk about. john moynahan. just a reminder that you can weigh in on any of our top stories -- you can find me on twitter. our question of the day is about china. we have seen a wild ride once again in chinese stock markets. are china market rules a necessary tool or an act of desperation? you can find me on twitter. it is 6:40 here in london. trading halted in the nyse on wednesday, but what is behind the glitch that blocked investors out? ♪

anna: welcome back, you are watching "countdown." 6:43 in london. millions of londoners faced travel chaos today as strikes bring the london underground to a halt for the first time since 2002. the walkout is over pay grades on the new tonight service set to begin in september. members of four unions failed to reach an agreement, with an offer including a 2% pay raise. greases rushing to put together an economic package by midnight to convince european leaders that can stay in the euro. six leaders have made it clear that alexis tsipras's government has one last chance to present a credible plan. eu countries will meet in brussels to decide their response.

a computer glitch that stopped trade on the nyse for more than three hours yesterday probably stems from a software upgrade that went wrong. it was the most serious outage since the nasdaq was. was -- since the nasdaq was forced to halt trading in 2013. trading on the nyse resumes less than an hour before it was due to close. let's get a little bit more on that trading outage story. matt miller files this report from new york. matt: for three hours, the nyse halted all trading and the world to come to an end. a technical glitch on the trading system forced the company to cancel all your orders and send them back to brokers leaving specialists with little to do and no information for hours. trading in u.s. stocks continued at a higher clip than average.

brokers routed orders through dozens of other exchanges around the country. the ceo of nyse told bloomberg that was his focus. >> it is a little bit of the hippocratic oath -- do no harm. my first concern was do no harm during the day. so stocks traded elsewhere. get the problem fixed into the back up and running. matt: stability was maintained, resuming trading almost exactly where it left off an hour before the close. although they are rare, pewter breakdowns have become a fact of life for investors, operating in a market that has spread out due to technological advances in regulation. nyse management said the problem was internal and not related to the cyber breaches. it was more likely to do with a software upgrade gone wrong. anna: the report takes is nicely

onto our next conversation. let's bring in people warm and joining us -- bring in pete norman. it took the nyse out for three hours, though there was other trading. pete: it is the first outage since 2013. tom farley made the big decision to try and see what was going on, but they had complaints from investors early in the morning that there was technical data issues. there was a big sigh of release when they got back online. anna: i wonder if this goes into the pantheon of famous closures are whether it will fade into the distance. it was only two years ago. let's talk about greece. we saw an interesting angle on the greek story, when we get an

interest rate decision. pete: mortgage rates, house prices, mark carney -- they will be releasing the latest base rate figures. we have a survey of 41 economist 's and all believe it will stay at 0.5%. anna: not much change. jon, what is your take on the u.k. economy? is going to be the second fastest growing this year and we heard from the chancellor extolling the virtues of the recovery even though austerity needs to be kept up. jonathan: we have managed to decouple ourselves fairly successfully from the european economy. our growth is not due to europe so much the cause in fact we have a trade deficit with 24 out of the 27 other european countries. are surplus is with the rest of

the world, and that is where the growth opportunities are. europe this wiki -- is shrinking more and more. anna: doesn't that make it a great export opportunity? jonathan: nodded the european economy is sinshrinking. anna: what else have you got for us pete? pete: there is this great photo feature with satellite images. economists have been using declassified u.s. air force photos of oil tanks, plantation areas especially in emerging markets, and have been able to compare from previous photos to now size of growth of economies which ones are contracting. anna: what is it we are looking at here? pete: these are lids of oil tanks. the lead skill up and down as the levels change in the shadows on the side show if they are

full or not fall. they can compare up and work out -- anna: you would control for time of day. pete: yeah. if you have a close look -- you don't see this but we are at ground level. anna: thank you. pete norman joining us from our website. jon how do you look at the greece story? is the grexit story clouded by your thoughts about what written should and shouldn't do? to some extent these are entirely separate conversations. that is why many would argue that they are in the position they are now. jonathan: that is certainly true but it is important to understand that within a few years 24 out of the 28 european countries are going to be in the euro. in other words, there is going

to develop a two-track eu which makes it easier for us to renegotiate. the greece story goes back to the 1990's, when everyone was talking about should there be a euro and who should join us? i co-authored a book aimed at the labour party and it was quite successful aimed at guys like gordon brown who came out against it. we tried to envision what would it be like. we gave an example of what happened in greece except we didn't call it greece because no one thought greece was going to be allowed. we had to use italy as the example. greece was allowed in the euro so it was a calamity waiting to happen. maybe it will happen this weekend or next year or next decade -- greece is going to

leave the euro. anna: here is an alternative -- this whole drama around greece or system change within greece greece reforms and manages to run an economy that looks more like the rest of europe, has monetary conditions and fiscal conditions that look more like the rest of europe, and therefore manages to play, to be a better member of the union. the whole question is whether they have similar enough economies. jonathan: yes. the whole reason the europe project it doesn't work is that the economies are fairly different in terms of the amount of tax base each country can get out of its population. greece has never been able to get more than 30% and it used to be much less. u.k. has stayed steady for 60 years at 36%. it doesn't matter what george osborne doesn't the budget, he is going to get 30% of the gdp

out of taxes. what's really important is to go to the gdp. you aren't going to get more. in france, you can get 50% out because their culture is so different. in germany you can get 40% out. it's like -- it doesn't matter what you do, the amount you get is the same. greece leaving, as you say, the euro, then has a fascinating issue -- can it stay in the euro with the way greece is? if it doesn't, you have all sorts of problems -- immigration is at the greek border of europe, and it becomes a lot more difficult to control. but you're absolutely right that all this will make it much easier for the u.k. to negotiate a better relationship with europe. europe is showing itself flexible. anna: you mentioned the fact

that there could be a two-track europe -- is that a track to pursue? big knowledge and that there are two types of europe? jonathan: we think that is the case. one of the points is negotiating trade agreements. we gave up the ability to negotiate trade agreements with anywhere in the world when we joined europe, so we have a negotiated a trade agreement since the 1970's. europe, turns out can't negotiate trade agreements. we haven't got a trade agreement with china. all the other countries are able to do that and we are not. we would like to be able to get back the ability to negotiate trade agreements because that would be tremendously important. anna: thank you.

thank you very much. greece racist to meet a midnight deadline to avoid a nexus from the euro. christine lagarde said in a speech at the brookings institution in washington on wednesday that debt restructuring may have to be part of any great deal. this lagarde: we have always -- miss lagarde: we have always advised that debt reduction will have to work on two legs. one leg is about significant reforms and fiscal consolidation, as we have advised in the case of latvia and it has worked. and the other leg is debt restructuring, which we believe is needed in this particular case for it to have debt

sustainability. anna: madame lagarde said that reforms remain a key requirement. miss lagarde: it is conditional upon the various requirements but all of them aim at restoring stability, restoring growth and debt sustainability. anna: christine lagarde speaking in the u.s. yesterday. we will have more on degrees as we go through the program, and more on china as well. the equity market is on a roller coaster ride. that was losing $3.9 trillion in less than a month. more on that when we come back. what you make of the chinese market rules? you can get in touch on twitter.

coming up next on "countdown," we are live in brussels and athens as the country and its creditors look ahead to a midnight deadline. ♪

anna: shanghai swings. chinese stocks are volatile as big of may continues to struggle to restore market confidence. this time it bands major shareholders from selling. greece under the gun, sequences government come together to -- ahead of a midnight deadline. central banks major contagion concerns. the cut by caution on greece and china. governor connie has called a key risk. ♪ welcome back to "countdown."

i am anna edwards. let us start by looking at the role of coaster ride we have -- looking at the roller coaster ride we have seen in the chinese equity market. a big swing today. we have 3.9 chilean dollars in less than a month. -- $3.9 trillion in less than a month. this is a year-to-date chart of what has been happening on the chinese equity markets. the government banning shareholders from selling stakes . let us get back to the u.s. story fascinating moves. even if part of that foundation is because of a lack of trading. the hours of no trading because of a software update. there was still trading

elsewhere so it was not that you cannot treat u.s. stocks. nasdaq, back in august 2013, the author -- the market did reopen. instinct that bad news issues bad news again. if it's talking about his concerns about greece and china. we saw equity markets moving lower on those global concerns rather than assuming this would stay the hands of the fed longer. let us talk about what is happening in china. chinese stocks are up. let's get to juliette saly. what is the latest? juliette: it is very volatile on the shanghai composite. we can see the level. 3743, up by 7%. really big swings.

we saw that really low open. a big jump to hear -- here. after the lunch break, up very strongly. authorities trying to stem this fourrot. only 50% of stocks trading in china. let us look over at the hang seng, up by 4.9%. it is starting to see a comeback. mainland china shares. pulling the hang seng to its local -- to us lowest level since 2009. still a few of these mainland shares, weaker banks to medications. japan and australia hanging in till the close. there are going to close high today.

i want to show you a couple of the companies we are watching. not only in china. these are the stocks listed on the hang seng index. we've got about 70% of the open. $3.5 billion share buyback. high tong listed -- broker firms coming back up after that selloff yesterday. looking into japan, it is closing higher. pretty flat following that recall of five more and banks -- five more airbags. it may fill assets worth ¥200 billion.

certainly it has been a wild ride. the chinese sharemarket and those chinese mainland shares in hong kong. it looks like we are going to recoup a lot of those losses from yesterday. the biggest jump in six years on the shanghai comp is it. we are seeing volatility continue. it is at 3.7% at the moment. anna: juliette saly joining us we have a question we are asking today. you can get in touch with me. shareholders telling not to sell. is it an act of desperation? tweet this -- tweet us.

breaking news in the digital entertainment segment. an internet gaming service says it is considering an offer from gmc -- from gvc holdings. they are confident in the full-year outlook. they are on course for savings. gambling websites offering poker and casino games. market cap at 816 billion pounds . greece faces a midnight deadline to unlock a bailout from european creditors. capital controls are still in full effect. greek banks are still closed.

our correspondence on the ground with the latest. guy johnson is in athens. hans nichols is in brussels. guy, to you. racing on to meet this midnight deadline. guy: at midnight russell's -- he needs to provide detailed proposals. comprehensive and specific proposals. that is what he talked about yesterday. we wait and see exactly what those proposals are. this is a three-year application. a starting again of the process. there is a lot of muscle memory. i will leave hans with the details. he has plenty more to say. let us talk about the mood music. it is being toned down. i believe tsipras found a little

more friendly in terms of his negotiating position. i think the temperature is incredibly high. it is edging down a fraction. anna: what is the face of the banking sector. it still remains closed. guy: they do. credit control is what we have here. two weeks of an economy without the banking system. that is tough. not only for individuals, but more so for companies. they are struggling at the moment. you do not have access to capital. you cannot get credit in terms of exporting and importing. tough to run a business in this story. the ela was maintained yesterday by the ecb. it will meet again on monday. possibility of a deal coming out. talk is beginning to swell here about a change in structure of

the banking system. banks merging. maybe as a result, we end up with a smaller more efficient banking system, but still a banking system that is close to the edge. anna: let us get to hans. we have heard from the finance minister. it will not be discussed. that sounds significant. hans: he is speaking for the german side of the group. he also said a debt restructuring is likely going to be a part of the discussion. that is what the imf is saying. you do not need to write off the greek debt, you need to tease it out over 40 years, six years 100 years. -- 40 years, 60 years, 100 years. here's how she is put it -- here is how she put it yesterday.

>> we have always advised that program walked on two legs. one leg is about significant reforms and physical consolidation -- fiscal consolidation. the other leg is that restructuring, which we believe is needed in the particular case of greece, for it to have that sustainability. -- to have debt sustainability. hans: he is sending this letter to the -- it is a three-year request before the to your

request was on the table. he gave a little bit of ground as soon as early next week. he said almost immediately. he made it clear that he wanted to have a conversation about the sustainability. the catch is an opportunity to discuss their debt sustainability. he agreed that when he forwarded a letter -- he said that sustainability -- he said that debt sustainability would be in the talks. anna: what are the german saying? hans: some very good reporting out of our colleagues in berlin. they say angela merkel is willing to let greece go, if they do not come up with a proposal. this is about the proposals we are going to see.

they sent the letter, we will get the specifics tonight. the greeks are expected to send -- merkel is not very optimistic. she believes there is a whole lot going on. the situation does not look good. everyone is waiting for the letter. everyone is went to see what greece will do on taxes and tension reform. defense spending as well to see if there is a possibility for a deal. anna: hans, thank you. thank you to you both. in time for the final thoughts with our guest, join -- john moynahan. chairman of the editorial board. we talked a lot about the subject in the run-up to the election. one of the things that came out is it is difficult to say whether the u.k. will be better or worse. you do not know what the future europe will look like.

john: we know the big opportunities are you shrinking. the opportunities in the rest of the world are growing. we are currently forced to have, because of your, it is not to help. we are not going to be a able to take advantage of those opportunities. if we move to the kind of nine ramik economy, small government -- kind of dynamic economy small government, then we can take advantage of the opportunities, whether we renegotiate our relationship with europe or belief. staying is the worst option. i think you were alluding to the -- yet we stay the same as we are with europe, it is not going to be very good. we have to take advantage if we

do. anna: we have managed to stay -- sign john: not to the -- john: not to the extent that we could. were we to have that more flex book economy. anna: john, thank you so much for spending your time with us this morning. 14 minutes past seven. we are going to take a break. coming up, the feds show a sign of concern over greece and china. will the global risk effect the timing of a rate hike in the u.s. stay with countdown. ♪

anna: welcome back to "countdown ." here are the stories need to know this morning.

another volatile session on china trading. the share index there in china. the governor struggles to restore investor confidence. a gain of 5.8%. more than 1000 forza companies remain lockout of trading -- more than 100 -- more than 1400 companies remain lockout of trading. greece must convince european leaders in -- leaders that it can remain in the euro. many companies will meet in brussels on sunday. the bank of england will make its latest policy announcement at noontime today. the governor has called the greek risk is a back job.

all 41 economists surveyed by bloomberg news thanks the bank will keep its key rate. millions of londoners face chaos today. the walkouts which came into effect last night is over the pay rate over a new night service which is set to begin in september. members of the four unions failed to reach an agreement. the author include -- the offer included a 2% pay increase. the world's biggest economy moving towards conditions that would support an interest rate rise. a policymaker said that they would need some -- they would need to seek more evidence. let us stay with that story. >> federal reserve officials

expressed caution about headwinds. they maintain the central bank was on the path for a increase. they said economic conditions are headed in that direction for an increase. that is according to the federal reserve minutes released. those minutes also pointed out that china and greece are contributing heavily to global head when. -- headwind. they pointed to problems the medically, most notably in some are spending. still all of the officials hinted at undershooting where you -- where he u.s. statistics work. when it came to inflation, they agreed they were still well below the 2% target. they expect to head towards that target. creditors are still in a standoff over that country's

economic future. china facing its own market rou t. for investors, a clearer picture may come later in the week. back to you. anna: phil mattingly filing that report. ahead of today's bank of england announcement, here is george. great to see you. let us talk about the fed. concern about china and about greece. at the same time, you have the u.s. treasury secretary playing down the effects of the chinese rout into the broader economy. how do you think these risks will make -- will take on the feds interest rate? george: the

meltdown -- probably quite limited. for something untoward happened and the market dropped another 30% or 40%. we could start to express concern about how that might spill over to the financial markets and global economy. as things stand i think the risk is minimal. anna: what do you think started the selling? do you think if investors test you think investors were buying at the beginning of the year thinking china was more advanced? that would've welcomed china into the fold? it would've put more volume through into chinese markets?

people took a step back from that a month or so ago. what has changed? george: i do not think this is a market, right? not a market as we understand it. this is a commonest party. it started -- this is a communist party. it started over a year ago. the government has been encouraging and enthusiastic about pumping up and taking measures to pump up the value of equities, partly because they want foreign capital to come into china. they want their remember the used more widely. partly because they want to encourage companies to shift from expensive debt financing to cheaper equity financing to

encourage the balance sheet of smes to improve. the hong kong shanghai connect scheme is one of many market measures they took to fulfill this. why did it suddenly cap out? not a clue. anna: you do not think it is a market. maybe we suggested by other measures. george karl that is what -- george: -- anna: you suggested it does not have much sparing on the economy, let alone the global economy. 20% of household assets in china -- is that right?: it is about 1/5 of -- the household sector more chinese people are trading.

probably 1/5 of which in the last four months. anna: that sells like a wealth effect on the rest of the economy. george: i do not think so. ownership of equities is pretty small. there would be some economic affects. although takes are not allowed to lend on margin they lend money on trust companies that do both. there is a kind of relationship there. the sop's desk dso ease which -- the s o eoe's -- there will be economic consequent is. i think they are rather small. i think there has to be bigger economic drags.

anna: what you make of the latest activity by the regulator to try and prop up the market? george: astounding. i think people lose count now. now the most recent one is about buying people who own 5% of stock from selling for six months. it is not uniquely chinese. the japanese that price keeping operations many years ago. hong kong but 10% of the market in the asian crisis. we have done our own market support. anna: it is pretty wacky. george: the chinese are not to be castigated for try to prop up a market. that they thought they could control it is instinct. anna: george stays with us for another conversation.

coming up, we'll have more on china's stock advance on a choppy trading day. a look at what is ahead on european trading this thursday morning. you are watching countdown. ♪

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♪ anna: welcome back. you are watching "countdown." 9:30 in athens. these are the stories you need to know. another roller coaster ride on the chinese benchmark share index. the government struggles to restore investor confidence. it is swung between a 3.8% loss and a gain of more than 7%. more than 1000 forged companies remain locked out of trading -- more than 100 -- more than 1400 companies remain locked out of trading. greece is trying to convince european leaders that he can remain in the euro.

they have one last time to prevent a credible -- to present a credible plan. the bank of england will make its latest policy announcement at midday u.k. time. the governor has called it the acute greek risk as a backdrop. economists surveyed will keep its key rate at 0.3%. the u.s. federal reserve's do meeting, moving towards conditions that would raise interest rates at one policy makers says they need to see one guest they need to see more evidence. less than half an hour to go until we see european equity trading this morning.

let us get another gauge on the volatility in the chinese markets. how that could spill over into european markets. caroline hyde is here. volatility comic if you look at how low -- volatility, if you look at how low it went and how hyde went. caroline: that had to go to great lengths to see shares rise in china. more than half the market hopeful in trading. europe, we are expecting a bounce as well. i will show you the euro stoxx 50. 6/10 of a percent. 5100 expected to gain about half percentage point. we are expecting gains across europe. what stocks might be affected? bmw, volkswagen, the luxury players that have been exposed to china. if you look at some of the

numbers, it is amazing. about the quarters of all luxury car sales -- audi is the most popular in china. stocks have been falling. he saw the june sales of autos in china falling for the first time in two months. he saw a significant fall there to its first sales decline in two years. clearly, we're starting to see the effects. we are starting to see the effects in american companies did this is the owner of kfc. one half of their sales come from china. look at the slump in the stocks that happened yesterday. it closed at 5%. they are particularly being hit by exposure to china. qualcomm the chipmaker.

germany yields rising today. they did yesterday. is it that optimism that greece will get a deal? many wondering why we are buying into the promises? money going out of germany going into the likes of italy and spain. foreign cost coming down for italy and spain for a second straight day. i little bit more risk on the debt side of things. back to you. anna: let us look ahead to the market open. the bank of england policy makers are set to keep interest rates at a record low today. they confront an economic picture. how is the situation in greece affecting what the npc is liberating today. jen: with greece being a fluid

situation, you do not know how that will translate into the growth aspect of the euro area which is the uk's greatest trading partner. in that environment, you do not know what the pictures go to be with the outlook for growth, then that is the reason we're keeping rates on hold. anna: could rates have started rising in the near future? genco the inflation picture is subdued in the u.k. -- genjen: the inflation picture is subdued in the u.k. anna: when d.c. rates finally hit desk when do you see rates finally -- when do you see rates finally heading up?

george: i think the bank will follow then the other way around. i think it is changing. the chancellors projections for the economy that we saw yesterday were as predicted, pretty upbeat. obviously, like everybody else, we are at risk if something untoward happens in europe. chances of that -- it will be tricky. it probably is not systemic. by the end of the year people will be becoming more confident. the key issue for us and the united states is income formation. wages and salary gaining traction. in both countries, we are beginning to see early signs of that. not to get carried away

about it. if that keeps going, i think the debate will shift. anna: they're not good to go up in the short-term then they will go up in the medium-term. an introduction of this new wage . a different type of minimum wage. working tax credits dropped as sort of a subsidy in the private sector. the chancellor forcing private people's hands. what you make of his budget yesterday? and his moves around the wage story? george: politically, it was a tour de force. economically, it is a gamble. as well, you might have reasonable confidence that large companies would be able to deal with the bill.

the cash pile. the u.k. is pretty big. most money to spend if need be. the need will be. the problem will be for small companies and companies with limited terms. anna: he had some politics. i take your point that pain will be felt. jen, your thoughts. jen: overall, he created a bit more of a headwind. a civil salary cap was put below wage increases. overall the fiscal policy mirrors what happened in the last parliament. you'll want it to be offset with monetary policy. george: i do not know -- if

anything, the fiscal start is a bit easier than it looked like it would've been before election. there is an additional year before the surplus is supposed to be the mix of public expenditure and taxation. provided the private section continue to do with the chancellor will do. i do not think it will be a barrier. while expectations about how high interest rates might go when they do start rising. -- wild expectations about how high interest rates might go when they do start rising. " george talked about where they sit in the late -- anna: george talked about where they sit in relation -- news about china and

greece. do you think that matters to the bank of england policy makers? jen: i think if you asked them about what they would say and they have no control over what the feds make policy in the united states. i think the bank is going to have to -- how quickly wages are picking up. anna: george, what do you think of the missing pieces? concerning greece in china. you played down the significance in relation to the u.s. do you think wages are starting to come through now? george: they are waiting for more confirmation of the economy picking up. clearly the economy is picking up after a disappointing stock

earlier in the year. there is some early signs of wages and salaries picking up. the broader indices is not from the monthly report. my hunch is that. over the summer, we will see a cumin civilly where this is taking place. i think they want -- a cumulatively where this is taking place. i think they want to do this. no, i think the message is we think we are on course, we are still watching it. anna: we want to do this, but we are scared. [applause] -- [laughter] thank you very much. let's tell you what is coming up after the break. you're looking at live pictures of the urban skyline this morning.

closed european equity markets are opening up in 18 minutes time. we will see if that last in the trading day. stay with us. ♪

anna: welcome back. "countdown you are watching." -- you are watching "countdown." another session of volatile trade. the shanghai composite is 3.8% -- is swinging between a 3.8% loss and a 7% gain. the market loss three-point $9 trillion in value. -- $3.9 mitrillion in value. he walk up was over pay grades

-- the walkout was over pay grades. the offer included a pay increase this year. greece is rushing to pull together a detailed economic package by midnight to convince european leaders that it can stay in the euro. leaders have made it clear that alexis services government -- alexis tsipras's government has one more chance. a computer gate. stocks trade on the you not -- on the new york stock exchange. the breakdown is the most serious outage. nasdaq was forced to halt trading in august 2014.

joining us now to look ahead to the market open, jonathan bell. jonathan, good morning. jonathan: and adjusting session ahead. we see futures suggesting we are going to be moving higher. and lack of conclusive move forward -- a lack of conclusive evidence of a move forward on greece. where do you see as heading in the european markets? jonathan: the broader picture for europe is about what is happening with greece. none of us know whether those claim to be successful negotiations or whether greece is going to end up out of the eurozone. either way markets will benefit from the scenario. our markets don't like uncertainty. if we get to the point where we

know what is happening, markets can move on from that. the upset that we have seen recently -- greece is going to carry on dominating headlines for the next week or so, until we know what is going on here it i think every time there is a setback, that might be an opportunity. anna: things do not seem to be improving. the governor of the bank of estonia commenting on greece talking about how the greek situation is much worse than 10 days ago. does it feel that way to you? we are not in touch with reality with how bad greece is. jonathan: things must be pretty awful. on sunday, i'm going to see if i'm able to buy the things i wanted to buy. since the referendum they will

come out of the eurozone and the deal will be how they come out. what the ramifications are whether there will be a new currency. in number of new issues. at the moment, it looks as though tsipras won't come up with sufficient to make answer merkel say we can do a deal and move forward. latency, we may find out tonight. if he turns around and comes up with a better package. anna: what makes you more confident? jonathan: a deal would be a good thing. we have been talking about greece. we always knew there was going to have to be a default or restructuring. anna: you do not mind from the investors perspective. tocco outside of greece, i do not think it matters.

-- jonathan: outside of greece i do not think it matters. in the long-term, i think it will then if it for them to come out. i would be in favor of them coming out. the pain is so much in the short-term, it might be better to come up with a deal now. anna: the humanitarian costs. let us move on and talk about the chinese equity markets. down a few percentage points. up five percentage points. all of that in one trading session. a good example of a bubble deflating. we should not worry anymore about it. does it have broader implications? jonathan: china was in a bubble. markets like the shenzhen went up 200% in two years. the china index -- these companies were in a bubble.

they have risen significantly. we've got some bizarre reactions . the fact that half of the companies ask for their shares to be suspended. stopping people from selling shares. these things are bizarre reactions to what should be a proper market setback. once you go away from those markets, the shanghai index is not as expensive. it still it expensive that's it still expensive, but not as expensive. i would say this is a normal market setback. the authorities should not worry. anna: are there safe ways to buy the chinese story right now? jonathan: buy hong kong. you get -- you get a lot of exposure to china. there are a lot of issues in europe.

there are ways into china but the market needs more of a setback. does this have an economic consequent? what authorities should be doing is what should we do about the economy? -- what authorities should the asking is what should we do about the economy? anna: we were asking on twitter the latest moves about chinese regulators, i think mobius was at -- was calling it an act of desperation. this will only stairway international investors. -- this will only scare away international investors. jonathan: they would've made up 60% of the emerging markets. there be changed people's view on emerging markets.

anna: the contagion to the rest of the world has been greater. jack lew was saying he is worried about contagion. jonathan: it is domestic investors and these chairs. we hear something like 19 million -- those 90 million people invested. it is very new investors in china. hang seng is the market to look at. hong kong has proper governance. you're still getting china exposure. anna: a slow rise in a just rates. your expectation, when d.c. them kicking off? september? december? jonathan: clearly they will holding off at the moment. they are worried about greece. they can rise now. if there is no bad news between now and september, they could

rise. they've got the leeway to say c -- let us see. that is going to have an impact on bond deals. anna: jonathan bell. we've got a few minutes to go before european equity training. "on the move's" jon ferro is here. jonathan: if you want a recipe to get your equity market in the green, 50% of that equity market is suspended, then china has banned stockholders from selling. that is one way to get your stock market up. a lot of people call that move desperate. it will all looks pretty desperate. we will talk about china in the show. reese as well. another deadline for greece. a midnight -- greece as well. another deadline for greece. a midnight deadline.

the bank of england decision. is there a decision to make? it has been a snooze fest for months after months. the overwhelming majority said they would by bloomberg -- majority surveyed by bloomberg said -- anna: are these desperate measures for chinese regulators? that was one of the conversations that i had with george magnus this morning. back in just a few minutes and it -- back in just a few minutes time with on the move. ♪

jonathan: good morning and welcome to "on the move." we are right here in london just moments away from the european stock market open. if you made it to work, you deserve a medal as well. china banks struggle, they ban major stockholders from selling shares. approaching the final deadline, alexis tsipras has until midnight to present measures and cut spending. contagion concerns, federal reserve minutes show optimism on the u.s. economy, undercut by caution on greece. the bank of england is expected to cut rates.

that is what i will be watching for the next hour. dax futures up by 55 point. we snapped a four-day losing streak on a stock 600. we will be down 10% from those highs that we hit in march. caroline hyde has your market open. caroline: euro stoxx 50 rose, it looks as though 5100 is up. meanwhile, portugal is rising. weighing on investors minds is the resurgence in chinese stocks, only a 5%.