since 2008. i am looking at futures markets higher, ftse futures up 85 points and dax futures up 252 points. 2.29%. with some corporate news as well. >> potential ipo running up. you have greece backing you. reflected in the market. it is all about the eurozone today. up 2.7% and we are expecting spain italy, portugal to go into the periphery of europe as well. a proposal is on the table from greece that might be agreed to by the creditors. they have to go through parliament but rbs saying that a grexit is no longer there base case scenario.

money going into the euro as well. risk appetite for the eurozone up at 1.1105. clearly some money going into the euro. we saw that spiking higher late last night. moving out of haven german borrowing costs rising which means the bonds are following -- falling because of their price. we are seeing them at five week lows in terms of borrowing costs and greece seeing almost a one percentage point move. many have the optimism that a deal will be done. some corporate news this morning, we have some companies coming out in terms of statements. ryanair up one point 6% because

finally the king maker has agreed. it seems that ryanair will let go of their 30% stake in aer lingus to aig. ryanair saying we will take your money, they will make a small profit on it having owned aer lingus for nine years now and they wish iag well. intercontinental hotels keep an eye on. international hotels in hong kong going for almost $1 billion. they will take away a tidy profit of some $700 million. driving that stock higher. german stocks sometimes are. german stocks just had a statement from the ceo telling the press that they will meet their 15% profit margin target.

they look to sell 200,000 porsches sometime this year. looking to see porsche up about 2% this morning. there is a new ipo on the scene and we will seat whether or not they get any trading. a dutch company all about high-frequency trading. some toy 1.5 million euros valuing the company at 1.5 billion. jon: the dax opening higher by 1.2 percent, the biggest opening day since june 23. ? will this rally hold? that is a picture of the markets in europe. let's get to hong kong for an update on asian trading. >> those hopes of a greece deal have been playing through in the

asia region but it is all about china and adjust what to say what a difference a couple of days makes. every center is in the green. big rises coming through from technology and consumers leading the way by 10%. we are also closing in hong kong and this momentum coming through finally by chinese authorities to stem the equity route appears to have paid off. we saw chinese mainland shares doing incredibly well and it closed higher by 2.1% and the second date seeing those eight shares really rally. almost now a 5% grain coming through with the best today rally we have seen -- two-day rally since june. this rally has also seen the benchmark pay back its losses for the week. that was on track to post its

worst weekly loss in a year. there was a bit of weakness coming through in japan, the nikkei down by half a percent and there are concerns the bank of japan may cut its gdp forecast. rebounders helping australia and helping them to lift by 0.5%. the closed the taiwan market at a little bit of again but it looks like all of those efforts by chinese authorities and a couple of bullish polls from places like morgan stanley and goldman sachs saying now is the time to buy chinese stocks has had the desired effect. we will close strongly up 4.5% on the close. jon: i guess that is what

happens and you restrict selling and chinese stocks go higher. in europe that games are accelerating. put in thursday and friday together we have a gain of 4.7%. a lot of movement in the first six minutes down to one country, one place and one situation -- the situation in greece. prime minister alexis tsipras offered to meet most of the demands of creditors in exchange for a 53.5 billion euro bailout. european leaders will likely decide during this sunday's eu summit. hans nichols is in berlin. guy johnson has been in athens for what feels like an eternity. when you look at the situation the initial reaction is that prime minister tsipras has blinked. guy: it does feel like it.

this was the proposal effectively put before the greek people and now he is accepting and putting it before parliament. it does feel like he has blinked. you can understand why -- look what would happen with the greek banks monday morning -- they would effectively be bankrupt. he would have a problem that would maybe dwarf the economic problem that we already have and as a result, maybe pragmatism has overcome ideology. that is a big story and we will watch it over the next few minutes but it does feel like mr. tsipras has blinked. they are already starting to spin it as being a no vote on leading -- leaving the euro and as a result of which they have to accept the proposal. this is politics. jon: we have to talk to hans

about the other side of the political coin. tsipras will turn up and say we made our compromise and out and out it is time for you to make yours. is restructuring really on the cards with creditors? hans: it seems like the germans are a little closer to that. guy is talking about mr. tsipras blinking. it could be that he is winking. all throughout the morning we have been hearing from members of parliament and they are skeptical of what he is actually offering. earlier there was a comment that the greek government is cheating their own people or cheating us again. first we have mrs. merkel and here is what she said yesterday -- i have said that a classic haircut is out of the picture and that hasn't changed between

yesterday and today but then mr. schaeuble seemed to give a little ground. i think the imf is correct. later he says there cannot be a haircut because it would infringe the system of the european union. how you square those comment gets down to whether or not you think something can pass the bundestag. in a few hours it will become a berlin story. after we get some signal, we need to figure out how members of our limit will vote on this. does angela merkel have the will or the authority or political capital to force a vote through the bundestag? it seems like many of her party are deeply suspicious. jon: the big question after sunday, let's assume that the plan goes through. the big question will be have they underestimated the damage

done and is it even enough going forward and the additional question attached to that would be whether syriza will be around long enough to see this through. going forward no one expects this to be easy and a lot of people watching this program will be thinking -- will we be back here in months you echo arguing about the same thing all over again echo -- again? guy: everyone knows how much damage has been done to the greek economy. i suspect it is significant and these numbers are probably wrong. the bulk of this money is largely designed to deal with the debt that greece has half -- has got to repay. what happens to the economy below that is a completely different question. that number may need to ultimately be higher.

whatever primary surplus we thought we had in place will not be in place. they have been talking about this this morning so we will wait and see what happens on that front. let's talk a little bit about the politics. it has been made very clear why alexis tsipras once to have the full backing of syriza. if he sees the left-wing faction breakaway, what does that mean you go -- mean? we don't know yet. but you will see some changes in greek politics. effectively he is the last man standing. he is the only leader that remains at the moment. what gets behind him remains an open question. it is doubtful that it remains the current one but to be honest i'm not sure that matters. greece will ultimately pass this and i think there is a politic

that feels it is the right way to go. that is probably the result you will get later but the wrinkle is how far syriza will go to jon: joining us now is patrick from the global multi-asset greek strategist at j.p. morgan asset strategy. >> markets like a relief rally and that is usually what causes it. does it matter what happens from here so long as this passes? if the greek suffer it is a tragedy for the markets they don't look at that consequence. >> i think one of the headlines i read this morning is that hope has broken out against europe again. i think that sums it up neatly.

markets will trade this very short-term and a deal is good news and no deal is bad news. the story might have been different a couple days ago but markets have been rallying -- rallying on the growing hopes for a deal so i think the markets would react quite negatively. while i hear everything that hans is saying i must say if there is a semiserious offer and this does look semi-serious. the mind boggles about domestic politics but if there is a serious offer i think germany will find it pretty hard to not at least give it one final shot. jon: in the experiences of the last six months and here in europe, are we really going to have a deal without someone coming out and saying no, it is not that simple or straightforward? >> big confusion comes on the

back of that referendum areas a week after the referendum that came with the same proposal and if anything part of the story has to do with tsipras's attempt to manage situation where it is close to impossible to impose any conditions on the creditors. i am not trying to decipher the greek and domestic politics. to me the only logical explanation is that tsipras went to the vote and ultimately came out victorious strengthening his position inside the party. it is quite telling that after the referendum he asked varoufakis to leave. i'm against that greek vote today. the chances are there will be factor. syriza has a lot of factions and the nationalist coalition partners and 17 seats in the

partners that still need to pass that vote and a party did not sign the proposal. if anything they know there are people on their side that did their best. the creditors and conditions are such and they will stay in the euro so under these conditions they were forced. so from that point of view i think syriza and tsipras will have to survive that. >> at this point we cannot get deeper into the politics without talking a financial system. you're just wake up monday morning with the deal if we have one and unwind council controls. how long is that financial system going to be tied up for? >> there will have to be some bridge financing for greece. even if we come away from sunday this will take time to go to the

german parliament and let's not forget the others in europe as well. there is finland and slovakia. everyone focuses on germany but it is far from the only show out there. there will have to be some bridge financing agreed and none of this is done. there are a lot of possibilities to screw up in the meantime. jon: the relief rally on the euro and stronger cross-ice, euro-dollar. that lasts against the safe haven sprint here and sterling is that unwinding here today? >> the biggest beneficiary for let will be the dollar. if you look at the june minutes of the fed, their two daegis concerns were greece and china. fingers crossed that we will get some resolution over the weekend. obviously with the chinese stock rally it may be the case that the buyers are being investigated.

but the chances are that will encourage the fed. they could embrace the idea of hiking rates sooner. it could be indicative as rates will be going up in the u.s. fairly soon. we think that the dollar will emerge victorious sweet actually think that euro-dollar lower will be the trade. dollar-yen has been moving already all day. that yen being the ultimate safe haven and that depends on a deal in reached over the weekend which is to our central case. jon: plenty of hurdles ahead for the moment, spread much tighter. italy versus germany we were at 1.60 just the other week. where is this heading?

we are not going back to april? >> the common threat that april and greeks have written over them is that confidence -- have written over them is that april in greece, the ecb was actually standing ready and containing contagion and that has certainly been a problem that we had over the last couple days. you can attribute the moves and risk exit -- assets. spreads are contained in the euro didn't react all that much. it is quite hard to attribute the shift in risk appetite between those two crises bubbling away. jon: i must say that we are sitting here as if a deal has been done. the deal is not done until the

deadline has passed and maybe one month after that. stay with us here throughout the next hour. coming up next -- ryanair green lights the sale of its stake in aer lingus to aig. china half rallies. we make sense with only half stocks trading and speak to the man on top of the firm who says it is one of the largest private holders of greek government bonds. [inaudible] ♪

jon: the shanghai composite to its biggest they bump since 2008. the rebound comes after a flurry of government measures. almost half of the total listed shares remain suspended from trading. greece has made an 11th hour bid in exchange for the bailout. alexis tsipras still insists the long-term it needs to be made more manageable. facing its first hurdle in the greek armament ahead of a meeting in brussels. the nuclear deal with iran is half fading. persistent differences are made

including lifting restrictions on art sales. those involved said it was total late to reach a deal by this morning. 23 minutes into the session and a relief rally across the equity market. we are pushing higher by 2%. the ftse 100 not missing out on the rally in mainland europe. let's lift the lid on the stoxx 600 index. caroline: i am focusing on airlines. the king maker, michael o'leary, of ryanair says yes iag you may take my 30% stake in aer lingus, we will take your cash -- good luck to you. ryanair up 1.44%. this is a record high. it gets a lift not only from

risk appetite but also this deal being signed off because they are going to make a profit. iag may well at last be able to get their hands on aer lingus -- the irish company that ryanair waited so long to buy itself. jon: let's get more on that story from kerry lundgren. did we expect them to do anything else than what they have done? >> you never know with michael o'leary. he can always be difficult. this makes complete sense. they were getting nowhere with their own attempts filing. they were now facing a competition commission demand that they sell down there stake to 5%. it seems logical that they agree and move on. they have been doing successfully with their own

plan. it makes sense. jon: the question this morning will be going forward -- what do they do with the money? >> they might return it to shareholders. they might consider other takeovers or other options. it is a fairly small profit on this. they won't give the exact amount that they made -- they have been holding it for almost a decade but i think they will be looking into ways to file that money into their network and primary airports and other things they are trying to do. jon: we spend a lot of time talking about m&a and telecom space but not airlines. is that it for iag? >> international airlines group. his vision is to create this enormous umbrella with different airlines under it. now to siberia, aer lingus

british airways -- i don't think he sees that as a limit. he will want all of those companies feeding in and making the entire group profitable. he will definitely continue looking. they want to make sure that works and does well for the bottom line but he will be definitely keeping his eyes open. jon: up next on this show, stocks in china surged today. we will bring you the latest from hong kong after the break. let's check in on equities. equity markets pushing higher. the dax up by 2%. gain on the periphery as well. switch up the board and have a quick look at the euro. a relief rally in the fx market.

a stronger euro. yields lower in italy and higher in germany. back in two.

jon: good morning and welcome back. a relief rally across the european equity space. the cac 40 up by 5.5%. seemingly greece giving into a lot of the demands from predators. -- creditors. if they stay in the eurozone remains to be seen. a stronger euro this morning. spreads are narrowing and italian yields the lower.

though -- those are the moves in europe if yield -- real action is a lot further. stocks in china surging again today for the biggest two day gain since 2008. that comes after drastic lose for the government to stop the decline of $2.1 trillion in less than a month. as the market frozen? the question is how much you can read and -- read into this rally? >> have not only allowed half the markets to suspend trading they have banned any shareholder of more than 5% for selling the shares for six months. you have ordered state companies and others to buy shares.

the police will investigate short-sellers. the steps that have taken have become more drastic. now it seems like they found the bottom. it is kind of amazing to watch the market. half of the shares were traded in the other half were all up at the daily limit. a couple weeks ago we were calling this $8.5 trillion stock market but it is more like a 6'5" trillion dollar enterprise -- $6.5 trillion enterprise. how much have they wrecked that

market through this intervention? jon: that will be some thing to talk about in the months to come. valuations. wrecked that market through thisbe say this isn't exactly a market and at the top of the market in june nobody talked about valuations with some of the stocks are trading in thousands on a p/e ratio. as we look at it now, a 30% drop what evaluations actually look like in china? >> we have been looking more at the median stock on the chinese exchanges. if you look at the shanghai composite it is way down. back at the peak it was around 108 times earnings. even now it is around 57 times earnings. this is by all means a very expensive market.

state banks -- people don't like them because they may not get their money back. now we are seeing this in the most broad scale. it is hard to argue that this is a cheat market. in hong kong, people have been telling us whether hong kong stocks or chinese stocks have been unfairly punished by the officials meddling. that has made them very attractive. we have seen a good rebound over the past two days. in terms of early shares people are worried about valuations and the government intervention. jon: have a great weekend. let's go back to caroline hyde.

we have been talking about this follow goes back to the u.s. and we can pinpoint the companies. caroline has done that. caroline: we had that breaking news from the manufacturer associations in growth won't be where we expected. it will be 3% higher. we'll see the ramifications on european companies. 75% of the market is owned by these three companies. you have the company that owns audi and bmw. have just seen that they have moved in lockstep and with chinese stocks. they reflected the downward trend we saw and the rally we have seen since today, we are

seeing bmw spike a little bit higher. there is a sense that these three stocks could be under pressure going forward when you see that they are so exposed to china. last month audi, the number one luxury carmaker in china suffered its first sales decrease in two years. what will june bring? last month as well we saw significant falls from the likes of bmw we have yet to see a pickup in june. we have also seen jaguar and lan d rover up by 32%. could the selloff be a boon for

carmakers? many crackdowns on giftgiving and ostentatious this but they sate money going into stock markets are the goods. stops in buying luxurious items such as cars and it might stop them -- start them piling back into cars. but audi seeing its first fall in sales in may, we will see how they fare this time around for june. jon: great work. let's bring in the executives. we talked about fallout and feedback loops and the amount of reputational effort spent in china. the fx reserves -- how significant is that? >> if you look at the foreign

ownership of chinese stocks they are about $100 billion and do not look as significant compared to the $4 trillion of fx reserves the chinese are having of a happening at the moment as well is that they are repaying their debt which amounts to $1 trillion. an acceleration of that selloff could have triggered equity outflows. leading to further significant reduction in fx reserves. it is important because the chinese with other sovereign currency managers have resolved the significant player by implication and currency markets and ethics reserve could mean there is a structural imbalance between supply and demand. if you look at the risk in the

stock market, these do not seem to reflect such a potential imbalance. such concern of about of uncertainty again, chances are these consequences could be quite significant. they will be tightening on the back of those conditions risk premier in the equity market and could lead to a broader risk off. jon: the damage has been done already. you have been looking at that. what is the damage? >> we don't know the numbers. we all know that there are plenty of companies that like to play the stock market rather than focusing on the operating business. and securing borrowing on share prices. there is a feedback the corporate health. normally you can have a stock

market take a dive and it doesn't affect the balance sheet of companies. that will be a factor there. on top of all the other effects, consumer confidence taken off on the back of that. even though there is not a lot of household with -- wealth. they read the papers. they have a lot of firepower and even if they manage to pump this up again come a it will not leave any damage behind. it is pretty optimistic to say the least. jon: half of it is in trading and everyone loves the headline, the biggest two-day pop since 2008. we don't know what this market would have done if they hadn't told the biggest market holders that they weren't allowed to sell. what we can ask is the question

whether this will be the sustained risk aversion in the months ahead. you can have a two-day pop the on that -- beyond that. >> it does highlight the potential lingering development. it is the case that the currency managers evolved as significant layers globally. if they were running out of money to buy stocks and bonds that could trigger reprising. more bouts of uncertainty like this could effectively contribute to that development on top of that. this is the case that what they have to deal with is a drop in export revenues. commodity exporters have to deal with the drop in export revenues and they have to deal with growing fiscal deficits and that could be a recipe for disaster.

jon: it could be a political disaster as well when you start talking about the consequences to social -- social stability. one month ago, we were sitting here talking about inclusion in msci indexes. chinese authorities going around the big, large stock investors saying -- invest in china. how much long-term damage has been done to the pro market repeatability of the communist party? >> you have had china chaos. there has been a lot of damage that has been done and the conclusion has to be questioned. there were a lot of statements that we want to give markets more importance. we didn't realize that's what they meant. jon: final point? >> obviously the basket membership that china is

aspiring in october could be threatened as well. if you want to create a reserve currency asset you have to guarantee some financial instability. you have to want people to buy your assets. obviously for all the good reasons and not helping. presumably there could be reputational damage which could mean they have to reconsider the speed of capital categorization and moving towards adopting the currency. jon: thank you for joining us this morning. back to brussels for another in a marathon meeting. there has already been a record amount of summits, not including conference calls. there have been 15 sessions between eurozone finance

ministers, two special euro area summits and two eu summits. will this weekend be the one that sees a lasting deal? more after the break when we speak to an investor who says he is one of the largest rabbit holders of greek debt. ♪

jon: good morning and welcome back to bloomberg tv.

alexis tsipras submitted a new or basel for a bailout package that matches most of the creditor's demands. ceo and founder of japonica music joins us now. great to have you with us this morning. the news overnight. when you look at a proposal from the greek government what are your thoughts on that? >> thank you for inviting us. initial thoughts are that it is a good step forward and a potential win-win. the one key point you would make is if they allow the accounting books were real numbers to reflect the debt relief. kind of a common sense thing to do.

the debt relief for the numbers are massive. you'll see a very different debt number. jon: the accounting standards that need to be applied. do greece have the personnel needed to achieve that? >> i think we had a summit in new -- munich and we invited 40 of the world's leaders to -- leading minds on sovereign debt and the conclusions were that they need eu assistance. they don't have the technical capability to calculate their own debt number. they don't. they have had four major restructuring since 2010 and they cannot calculate their own debt number. preliminary efforts indicate that a net debt is somewhere in the range of 18%.

it is a difficult calculation and they will need a lot of assistance. you have two years to calculate it and you need help. europe can step up to the plate here. especially germany and help them and the ecb and calculate their debt number. jon: when you look at the figure it kind of doesn't matter. the needs are already very low. the fact that 80% of the debt is in the official sector which strips out some of that financial market risk. why does it matters much that we get a figure that is accurate? >> that is a very good question and one that was discussed over the last two days. one moment later you would have others saying they have to drive their revenue and they have to

drive their expenses to either a 60% number or a hundred 20% number and the ecb says we cannot provide collateral at these debt levels. if the month -- number is not meaningless why do you keep repeating it yet count -- repeating it? we asked if anyone believes that 180% is a real number and not a single person in the entire group from all over the world would agree that is the number. if it is the wrong number and don't let it drive policy areas it is unfair. they need some help here. we had a multidisciplinary group and that is what you need. jon: isn't it that good news for you with skin in the game that eventually the ecb gets on board and they get access to that program regardless of what

happens to the economy and the people in greece as much of a tragedy as that is. 25% of people are unemployed in spain as well but if you bought spanish debt in 2012 you are doing well regardless of what is happening on the ground and regardless of what is in the pockets of the spanish people. you have skin in the game -- isn't that good news for you? >> it is good news for the greeks and the germans. the last two years -- we don't what to look back. the last two years have been a slave and have kept greece in a debtor's camp. when you restructure your debt, and allows the debtor to reflect the real values. what you have seen in greece -- they don't have technical skills is that they have basically been kept in debtor's prison for two years. there are 11 billion people and they are suffering unnecessarily.

they say let's value it correctly. give it good state building skills, show them how to calculate your debt number but also the right primary ballots. you'll get transparency, accountability, trust and confidence -- this is a fresh start. greece needs a fresh start and that was the conclusion. jon: just to dig in to where you are positioned right now. there is a tender offer to purchase $4 billion of greek debt, can you give us an update on how much you bought in the end? >> we are a private firm. we don't have to disclose anything but what we have said to give a general sense is in the time when we did the tender -- when we had reasonable information on the owners we were one of the largest owners. that was more than we should

have said at the time because obviously competitors looked again knowledge from us so people who do trade -- we don't because we are not a hedge fund they look for that information for profiteering. it is accurate. jon: it is out there now. in terms of the prices that you pay, can you talk about the price you were paid and whether you are in the money right now? >> i think we also did say that we started buying when the bonds were about 11. most of a large portion of what we bought was in the teens and after the coupon it is in the low teens. it has been a good investment to state it mildly but we are long-term investors. we build businesses and that is typically what we do. we look at greece as this

performing opportunity and we have germans there and the government there. they are on the verge of moving forward if they can just get the system especially in the ministry of finance. it is actually critical and if they could get a credible finance minister who has skills in accounting, finance and turnaround it would be a world of difference. it is about the finance minister and it is all about that job and that is kind of the first step forward. jon: because we are pushed for time let's say we wake up monday morning and we have made progress and we move away, in your business with japonica partners, would you be buying some of those greek companies and have you got targets? >> we have been looking and we have said early on if they have a credible finance minister who

understands finance accounting and turnaround, we will support business and the country, but need to know that they have a credible finance minister who has real global respect and finance accounting and turnaround. for us it is that simple. we want a credible respected finance minister. jon: [indiscernible] >> without being flippant -- does he have any turnaround management experience? i think the answer says it self. jon: paul kazarian great to have you with us. we look forward to having you back on the show. that is almost it "the pulse" is up next. manus cranny, you and i had quite a trip getting home. manus: a lot of experiences. we put johnny on a bus.

we periscoped that. we are at the cutting edge. jon: it has been a tough time for the city of london. a much tougher time for the people of greece. is that the top of agenda? manus: it is politics, politics politics. who does tsipras need to get this structure through the greek parliament? what we will see here is merkel stepping back or tsipras stepping back. jon: manus cranny coming up informant it's time. your to talk about these markets, i am on twitter. that is it from me. equities pushing higher.

the dax up by 2%. equities in green across europe. have a great weekend. ♪

manus: just hours before a deadline, greece submits a bailout proposal to creditors, the plan faces its first hurdle in athens this morning. the euro jumped as investors breathed a sigh of relief. grexit is no longer the best case scenario. chinese stocks enjoy their biggest two-day gain since 2008. government measures start again. -- to kick in. the ryan agrees to