guy: china's contraction, and manufacturing pmi comes to a three-year low. anna: australia holds. the r.b.i. leaves rates at two present. lower commodity prices. >> the german chancellor warns that europe's immigration agreement is at risk. she gives a joint press conference with the spanish minister at 9:00 a.m. this morning. welcome to countdown. welcome to the program. it is just 6:00 a.m. on tuesday morning. guy: a busy session overnight.

the chinese manufacturing numbers -- a real disappointment, reinforcing the point that the economy is slowing down. anna: the pmi is the lowest in three years. goldman sachs. options trader is saying that it has never been so negative. they have never seen anything so negative in the chinese equity markets. guy: this is a five-year chart you're looking at and this is the low you're looking at. 49.7. chinese manufacturing is a huge part of the economy. below 50 on a pmi number implies contraction. anna: we're back in able market on oil. shall i say that again. bull are back in a market. the largest three-day increase in 20 years. guy: take a look at this chart. it highlights the decline that we have seen.

anna: a six-year low. guy: it is a rally. it should be somewhere over here. that is what annie -- anna is talking about. look at the top that we has seen subsequent to this. this is the lowering of the u.s. the factxpected and that opec may be willing to talk about a fair price. anna: fair and reasonable pricing are the words they are using. might they be willing to talk with other producers about the possibility of cutting back on production. a do not want to shoulder all of that themselves. had a good effect on the u.s. session yesterday if you are an oil producer. are one of thers biggest adult stories for us today. anna: the broader picture with a negative one. down between seven cents and six cents. overnight, look following that china data, we saw yesterday's close, features

stole off overnight. it looks like we are in for another negative session. anna: if anyone thought that the actions taken by the chinese would put a floor under the equity markets, it doesn't look like that has been happening just yet. talking about the european migration from it refugee crisis and we are asking a question on twitter about that. guy: the immigration crisis is a big emotional subject right now. that angela merkel is weighing in, we will hear a lot more about this in the next few days. how does your deal with this? there is a summit now among the european members. -- big question is this is at rest. we will talk to a guest about that. let's get back to the trading session that is underway in asia.

>> good morning. we are seeing stocks down across the asia-pacific today as you would expect given the manufacturing number. the lowest in three years that we received from china this morning. it has had an impact on every trading partner of china's today. we are seeing the asia-pacific down 1.3% and you're seeing this best playing across the region. the shanghai composite is down under 1%. we see in australia. -- we see concern in australia. this is filtered through to the currency markets. you are seeing buying in the saving a place, gold is up in this session. the nikkei 225, when the currency rises in tokyo, the stock market declines. that inverse relationship playing out as the investors seek safe haven in the japanese yen. 3.6%er has a nice game, steelmakers, down in that session.

following the commodities market, very closely. my video movers in estoril you are very sensitive to the chinese growth story. evolution mining, one of the leaders is up 4%. we are seeing some energy-related stocks declining including airlines that airlines are doing well at this advancing 3% in that session. speaking of airlines, we have been following air china today. a big recliner on the a share index here in hong kong. case is an antitrust involving air cargo units. it will go to trial in new york during air india as well as air new zealand are also included in that case. as we look at air china, you are seeing the shares down. 5% in the session. another stock we are following, securities. yesterday, i told you to focus on the brokers and wrongdoing by some members of their staff leading to insider trading. amid this market turmoil, it is down 3%. here's a snapshot of what is

happening on the shanghai composite as we closely follow the chinese market. the market is down on the order of 1% at the moment. we will follow this closely. it is been a volatile start to a new month. it looks like august and some of the wild moments in that month with respect to china continue as september begins. guy: thank you very much. let's dig deeper to the chinese story right now because we have that weekday. the lowest reading in three years. pmi came in a 49.7 signaling a contractor. come what --, what does that say -- nick: i think what this shows is some -- it is confirmation of what we have seen in the last couple of months. it has been so long since we

have had positive data out of china. what this shows is some of the traditional drivers of the isnomy, industrial output really the set by overcapacity, construction for example. it shows the contraction there that we had been seeing for some time. those drivers are fading. the one bit of positive news here is that services -- the service sector has had expansion according to pmi which reflects that the government may be having some success as it seeks to shift this economy from one based on infrastructure and a sports one driven by internal consumer demand from its own citizens. going on, andt is what you laid out, given what we have seen thus far, what happens next? what can they do to boost the economy? nick: there is still quite a lot

of money locked up in the system. if you look at banks, they are still required to hold about 18% of their assets in reserve so the government could release that money into the system. they haven is that been taking a lot of steps. they cut interest rates, they cut the reserve requirement ratio. what this data shows is that there is still a great deal to be done. it adds to the evidence in the sense of urgency for the government as it really looks to boost the economy and what we are seeing also come economists are expected in another interest rate cut for the end of the year. anna: eight minutes past 6:00, the bank of austria which manages the developed world's most exposed economies to china. it announced it will not be raising interest rates. made referencent to volatile equity markets

associated with developments in china. guy: paul allen is standing by in sydney. paul, china obviously a huge problem. the currency is helping, isn't it. maybe that is why the rba is doing what it is doing and leaving things on hold. paul: the rba has stopped talking about the currency. we have gotten used to that being a feature of the policy statements of the past few months. they seem to be satisfied with the level of the aussie dollar now. beenrms of china, we have watching the rate decision in terms of the rba moving. we did not expect them to. we did expect more commentary on china the what we got. the equity markets have been considerably more volatile of late, associated with developments in china, a lot of financial markets have been relatively stable. and that is it. that is all the rba had to say on the matter. if we do have a look at rba castrate forward in china's gdp tracker on the same graph. you can see they are both pretty

much in lockstep downward. it has also had something to say about where the rba may go next relative to china. if we think back to august 11 come before the yuan devaluation and the turmoil last week, it -- there was a 35% chance of a cut by december. it is now a to 65%. in all still you, they have just revealed a currency account deficit. how worrying is that? paul: it is used. $19 billion deficit which is the lowest since 2009. to get some context, that number has not been in surplus since the 1970's. we have become accustomed to bad when it comes to the current account. there were some disturbing news buried in that. coal was down 11%.

both in volume and in price. you can see the impact their of the commodities slumped. of more concern that is expected to have a hit on gdp, subtracting six of a percentage point of gdp growth. those figures come out on thursday. the commodities slumped is weighing hard on this figures. still to come, 50-50 on our survey shows 40% of economists say there would be a september hike. anna: oil has a three-day rally. u.s. data. stay with count them, we will break on the stories that you need to know. ♪

anna: welcome back. here are the stories you need to know. guy: chinese that's have

extended the markets biggest tumble since 2008. the pmi number dropped to a three-year low earlier. grew over the effectiveness of government intervention to shore up equity. august wasl pmi for 49.7. a joe has left interest decliningnged as the currency cushions the impact of lower commodity prices. the bank of us joe you governor kept the cash rate at a record low. -- low to present. guy: oil's biggest three-day rally in 25 years. surging 27% over three days. augustay, the most since 1990. remember, we were having a were at that point. oil jump to the highest in the said it wasopec

ready to talk to other producers to achieve a fair and reasonable price. anna: the tech giant google has teamed up with a french company and they are aiming to tackle new ways to treat diabetes. what are we expecting to see after this new partnership? >> in a broad sense what google says it wants to do here is change the way that diabetes is treated from being reactive and episodic to pro active and preventative. it is teaming up with different drugmaker to work on a number of things. smartof all, things like insulin delivery devices. smart measurement devices. devices that monitor glucose and upload the data to the cloud. the idea being that patients and doctors can get better control of treatment and are better able to manage the disease. it is not the first time that google has teamed up with a pharmaceutical company, with

novartis, it teamed up last year, they are working on contact lenses that use tiny senses to read blood sugar levels through tears. worked on that product will begin next year. it has also teamed up with another company to work on a sensor the size of a bandage that collects to the cloud. it is working on bluetooth enabled pence that let the doctor monitor how much insulin a patient is using and when. why such a focus on diabetes? this is a disease that affects 382 million people worldwide. it will affect an estimated 600 million people by 2035. the cost in health care resources and productivity -- $245 billion a year in u.s. alone. anna: thank you. on the google partnership. guy: plenty of time still to

come. we will have more on the cutting edge tech science stories surrounding battery production and innovation. we are talking to a man who is trying to create a liquid battery. he is an m.i.t. chemical professor, donald sat away. batteries are a big problem for the world. how do we solve the issue. we will talk about that later on. anna: that comes from future trends. we will be speaking later on in the programming to a nobel prize-winning biologist. gears.hift another sign of slowdown in the world's second-biggest economy. we talked about it already. chinese manufacturing contracting for the first time in six months. demand outsidee of china way on factoring. the central bank has cut rates five times since november so far they have failed to revive growth drivers like the manufacturing sector. guy: how do we put this into context.

surprise on that number. we know it is slowing down but the evidence continues to mount that the slowdown is a deep one. >> the data is not surprising. it is probably likely to be sustained. china, it isith always about the managed slowdown. that is that in a way orderly is very difficult. you're seeing the manifestation of that now. anna: how significant are capital outflows? whether china can continue to see large amounts of foreign exchange leaving the country. what actions will they take to stem that? >> that is a concern especially in the last three weeks when they have looked to step back from the intervention in the yuan and then having to reverse that. it will be a difficult step for them to take. in a way, they have managed that

in a way that could see them turning back on the stock market as well. stepping back from the intervention we have seen their. i think that is another concern. they are trying to move away from that. chineseout the authorities, they are stepping back from intervening until they are not anymore. look -- at thea -- chinaentral banks, is slowing down at a time when we still have not gotten the global economy, the western economy on a stable footing. the chinese economy was such a counterweight to the global financial crisis in 20 away and 2010. they contributed about 20% growth combined when we solve the major t10 contract. g 10 contract. we are seeing this mindset. that is where the growth is going to come from -- that idea

is going to change. yes, it will still be a factor in the next 10 years but at the moment, we will have to wait the next few months to see that happening. especially when others are still chomping at the bit to puts the -- to put rates up. start on the road to normalization. the new normal. we survey the economists that say the feds will raise the rates in september. seeingarted the year not the fed raising rates. not -- we have seen mixed messages in recent speeches. on balance, i think the most important thing for the fed is a want to know when they make that move that is one -- that it is when they do not have to reverse again. the worst thing they can do is have to reverse that following

six or 12 months because things have not turned up with a mop. when they move, they want to know that it is right one. anna: you don't think september. other economists do. 48% do. are more convinced about september than the traders camp. can -- there is another -- a lot of inertia there. i don't want to change their view. the market pricing has looked a lot more of the dynamics. when you relate china to china slowing down, fed raising rates. the fed is so domestically

focused that it is paying attention but not really. >> that would have been the case i think in the pre-financial crisis era. some catastrophe would have had to happen for them to do that. as a proportion of the global economy has changed to about 20%. you have to pay more attention to the world. you have seen that in the statements recently as they mention greece, etc.. the fed has changed. they do have to take more attention than they have before. anna: do they have to wait until it comes back at some sort of wealth affect? before they react to that kind of volatility in the market. the slowey reacting to growth in china. abouty are also concerned

the volatility that we do see in desk we have seen that come through in their own equity markets and the reverse there. factors do those come into play. guy: oil has rallied quite significantly in the last three days. it is failing a little bit as you can see on the chart. do you think the fed will take that as a palliative for the u.s. economy? -- we now know the u.s. energy dependent start has changed significantly. maybe this encourages investment. it encourages the oil sector. >> the u.s. overall does want to -- it is not ace good factor. on balance, if you take that

aspect. the of place in expectations and the inflation story is still not playing into pushing the rate hike story, yes, they will be much happier to see it above the 50 level. one economists view was that the laughing the global economy needs right now is a higher oil price. nothing oil does right now complete the global economy. bemoanedas weaker, one the lack of inflation and as it goes higher, you worry about slow growth. >> the volatility we have seen has been unprecedented. biggest since earlier. what we have seen in the oil prices -- on the bigger chart you showed there, it is still hugely lower than we have seen

before. oil below the 50, especially to the u.s. is quite difficult. anna: and for all still yet and canada. in canada, we get the gdp numbers coming out later on this week. all of these commodity related currencies. australia, if you look at their currency, it is more active fair value. they has stepped back from trying to talk down their currency significantly. that is probably the right thing to do. it has been a huge benefit to them. think -- they are putting together the deal on greece. thinkt necessarily explicitly talking down the currency at this point. simon, thank you very

much. angela merkel and the spanish prime minister meeting in berlin today. we are going to take a closer look at migration. what can be done to deal with the current crisis? ♪

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call 800-501-6000 to switch today. perks are nice. but the best thing you can give your business is comcast business. comcast business. built for business. these are the stories you need to know. anna: chinese stocks have extended the stoxx biggest tumble. the factory gate has dropped to a three-year low. manageicial purchasing index for august was 49.7, down from 50 in july. under 50 marking contracts in. guy: angela merkel has warned that failing to share migration issues. speaking in berlin, angela merkel repeated that germany

expected taken about 800,000 refugees this year. more than any other eu stickered the german chancellor is due to , the spanisheagues prime minister to discuss the issue later today. media isnese state saying a journalist has confessed to causing panic in the stock market. he admitted wrongly reporting that the chinese securities regulated was planning an exit. >> i am sorry for what i have done. i should not have done this just to be sensationalist. and catch people's eyes and cause such great damage to the country and its stock investors. out what hasnd happened now. i am keeping a very close eye on crude oil. we saw that three date bull rally, an increase of 27%, the biggest three-day increase in 25 years for we are seeing oil come

off of that today. last week, we saw brent crude drop below $45 a barrel for the first time since 2009. in that three-day rally, we saw it hit $54 a barrel it is at $52 right now. the little price drop we are seeing today is before us in government data that forecast to show that supply has increased. speaking of the energy theme, i want to show you our rwe. the stock is being booted out of the euro stoxx 50. , take a look at the chart. the reason is what has talked to the price over this year. a drop of 48% this year. last week, what we saw was the stock price, i have circled it for you, it hit its lowest level 1992 which is one bloomberg began to track the stock. it is not the only stock that is

being booted off at the stoxx 50. rwe, germany's biggest power producer and the reason it has been suffering so byh it has been dragged down a slump in electricity prices. it will be off of stoxx 50. it has been on there for 70 years. there could be a review of whether it will stay in germany's dax index as well. guy: thank you very much. stay up to speed with the markets. let's get some analysis on how the markets are doing. good morning to you peter. dow saw the biggest monthly drop in five years. give us the benefit of your experience. what you think happened in august? to obvious reasons.

there was always likely to be a monetary policy shift. secondly, if you look at the u.s., they are quite negative. a continuous re-rating which is what we have gone through for the last five years. mostly in relation to earnings. year, attempts to re-rate again against an earnings situation that is negative. market is more difficult. has been that everyone missing for 12 months is that the emerging markets are desk they have cyclical and structural problems. that is manifesting itself. we need to be cautious for the first six months. narrowness in the stock market leadership, all of the classic signs of difficult times.

with a federal that have itself in a situation where it cannot make long-term interest-rate decisions. it is a shocking way to set monetary policy. we are discussing on this show whether the fed moves based on what happens to the dow jones. that is absurd for long-term monetary policy when you're unemployment rate is approaching 5% in the united dates which it is. thatu either do or don't you look 12 or 24 months forward, unless you want a recession in the united states, their unemployment rate will continue to fall and wage pressures will grow. guy: can the fed raise rates? >> let's take the earnings scenario. the s&p is the problem. domestic profitability is strong. corporate domestic profitability is getting strong and rising. the point and try to get to his look how absurd this process is become.

is bound our monetary policy to the bubbles they have created. we have discussions on shows like this about whether the fed raises rates depending on the s&p and the dow is going to do. that is insane. anna: does the fed need to get on with it? >> yes. i am not saying it answers the question. the year on year cpi number -- it is not collapsing as it is. and foodke in energy which are variables, in six months time they could be it is strengthening. that includes the u.k. as well. -- wedea that we have also have cpi issues here that need some kind of medium-term response. monetary policy is things that i asset markets. how did we get here? guy: the financial crisis.

>> dependency is the key. i am suggesting -- to be fair, some of the federal government have been saying this. you have to take the year or two year review. it could be japan. the argument against what i said is a could be japan. you cannot have it both ways. if it is inflationary, or it's -- guy: do i want to be in the stock market? there is more than an even chance that we are entering a bear market. if i were you i would stay in cash. marginal money. stay in cash. i have said it is going to be much more problematic. some of the emerging markets. >> energy is the obvious value.

it is not a value trap. you can look at bp. i am not one of the believers that the think the underlying demand justifies the prices. don't think the economic growth is coming back, you would not want to be in the stock market anyway. to that the world is not a happy place. -- that tells you that the world is not a happy place. what you're seeing internally is that they have been in poor or for more than a few months. a lot of market professionals are saying this market is unhealthy. less and less stop driving it up. in the s&p 500. inside that you normally look at is telling you that it is not healthy.

most of the stoxx, and the sectors are evenly priced. in the united states. that is one of the problems you have got. they have re-rated them and they have indigestion. anna: traders and investors cannot take vacations in august anymore. think that investors really coming back to things in september, reassessing and things change or was this a fair reflection of everyone views? >> i think the market is running out of steam. there is no alternative. you are either in cash or you invest. you put a lot of people into these situations and they have not seen capital losses. they think they will be fine. here is a great one -- 58%

equity allocations in the 401(k) in the u.s. they just watch them appreciate for five years and they are fully loaded in that. that is one of the myths of the equity market. by hook or bys crook a right up there against the 2000 levels. guy: how overvalued is the market right now? >> 18 or 19 times. you are touching medium stocks. they are touching at the 50 years high. we are talking very expensive. part of the reason is the indigestion and the struggle. the rest of the world is not necessarily priced in the same fashion. if the u.s. catches a cold, we all caps influenza.

you cannot separate them at this point. anna: -- guy: coming up, the kremlin cracks down again on the web. today marks the don of a new era in russia. the country unleashing the string of the new laws. we will have more on that story when we return. ♪

anna: welcome back. chinese that have extended the markets tumble since 2008. the pmi number dropping to a three-year low overnight. concern growing over the effectiveness of government intervention to show up equity. the official pmi number, august was down from 50. it implies contraction. left was julia has

interest rates unchanged with the declining currency questioning the economy from the lower commodity prices. the reserve bank of australia governor get the cash rate at a record low 2% as expected following reductions in may and february. guy: ukrainian policeman has talked about clashes. separatists. 122 people were injured. smoke was seen billowing over the building as ambulances were rushing from the scene following lawmakers preliminary approval for constitutional changes. are in awe say banks crisis, we can save refugees. that is what angela merkel says. she has warned that a failure to work together good but the eu's free travel zone at risk. hans nichols joins us now from berlin. how is angela merkel making her argument? hans: he is making a three-part

argument. she is making this trade and commerce argument. if europe does not arise at a common distribution system, the very commerce that undergirds the european union is at risk. she is also making a humanitarian argument. europe has an obligation to refugee. for her own countrymen, she is making a historic one thing germany should be proud that so many refugees want to come here. when you look at the numbers, they are staggering. this year, there are expected to be some 800,000 applicants here in germany. if you look at what has happened in the first part of the year, you see how skewed it is. germany has already had 188,000 applicants. if you look at some of the other countries like greece, 6000. at 4700.ey are it is a reflection that so many whether they are economic refugees or migrants or refugees from war-torn countries, they want to come to germany because they view the

economy as strong. the argument that your hearing inside angela merkel's government and the ministers is that germany simply cannot accept all of the economic refugees. they need to track that down. they need to be quicker and sterner with those coming in from the balkans. take a look at this number here. where the asylum applications are coming in to germany. syria is at the top. and then serbia. you can make an economic migrant case there. iraq.a, afghanistan, then look at the profile from spain. you can see more economic migrant. syria is at the top. and you're the ukraine, mali, algeria, palestine. thatgives you a sense there is going to be a split between economic migration and war-torn migration. here is what merkel said last night in a press conference. she said if europe fails on this question of refugees, its close

association with the rights of citizens, threatens to fall apart. europe as a whole must move on this. the current situation is not satisfactory. 340,000ve been some syngenta applications are refugee applications already in the first half of this year. merkel wants to see action. on plans to present a plan september 24. guy: the story is getting bigger on a daily basis. looking at the numbers on the screen for macedonia. more and more people are boarding trains and vehicles to get to the countries you have a naming. the problem is you have a very emotive response to it. angela merkel saying that the germans should welcome them. how do you deal with the politics? is having a very difficult time. in some cases, she is being condemned by her critics saying she has not been forceful enough

in condemning those attacks. what merkel is trying to do is broaden the discussion and make this about all of your while condemning the attacks domestically. of to make this about all europe and trying to put pressure on other countries. when you look at the numbers of refugees that are coming in, germany is that the top, followed by sweden. germany is clearly out front. when you do it on a per capita basis, sweden is much higher. germany is not actually that high. this morning the news is dominated by discussions and news of another five trains coming into munich from the hungarian border. some 800 individuals on those trees. -- are wesion here talking about tents or schools. what merkel wants to do is shift the conversation more towards the schools. how you get these migrants and refugees integrated into german society? had he make sure they are taken care of. not just temporary tent measures but longer-term school measures. guy: it is interesting. talking about net benefits that

come as a result if they are educated and can contribute to the economy. it may be a big plus for germany going forward. anna: more on angela merkel comments on free trade and free travel. by peter.ned abouttalk a little bit whether the area is that as a concept is under threat. it seems to matter to a number of the politicians. peter: it is very hard to make a distinction between refugees and economic migrants. is a great thing for europe. predictionsat the than the fact that you have more refugees will definitely help europe to deal with the problems

it is suffering from. towill also be wrong however claim that this will solve all problems. the european commission's 10-to a present of the sustainability cap will be solved with migration. the rest will have to be dealt with by making europe more competitive. to focus back on schengen. how can we have focus -- how can we focus on distribution if you have free movement within schengen? how much are those issues when to rub up against each other? >> schengen is economically important. mandatory redistribution of migrants is a bad idea. -- it is like

giving a free check to all kinds of anti-immigration. when you have the schengen zone and you have 2000 refugees to go to poland, they can move to germany the next day. this is not going to ease or contribute to a more fair spread. what we need to do is look at not only the extern a -- external numbers but the number of people coming in. even if you protect your external border, you cannot forget that most refugees arrive not by boat, but by playing and overstaying their visas. what needs to happen if you're facing a refugee crisis of this proportion and you don't want to take all of these people and you need to look at externalization solutions -- this has been proposed by certain politicians. europe, outside europe's borders in some of the places that these people are coming from. apologize for the

background noise on that. it sounded like someone was making their breakfast. it seems appropriate. let's look at the twitter question relating back to the migration question. is europe doing enough to solve the migration crisis? we would like to get your thoughts on that. anna: let's take a look at what of the stories that is being covered by bloomberg. tim coulter joins us now with a look at one of them in more detail. we are talking about russia. in the russian government's attempts to try and keep russian data in russia. takess is a law that effect today that all foreign companies operating have to keep data relating to russian citizens on russian soil. facebook, google, and their will often comply with this law. snowden. a lot of people are looking at this. >> germany and brazil are also

thinking similar things. what is interesting in russia though is how secure is that data going to be? that totics would say access it, for the russian government to access that data they need a court order but that is really turned down is the charge against the government. you mentioned some of the companies that will have to deal with this like facebook and google, we understand that they have been meeting with the kremlin to try and work out what this all means for them. >> they have been. explained to us how they are actually going to respond other than the fact that they are meeting with the government and trying to make sense of the law. you can see what is happening to the media and foreign companies operating in russia. microsoft closed their russian office. some of the freer presses have

moved abroad and are not -- and are now operating from ill -- israel and elsewhere. economys fits in an that is controlled like the russian economy is. this fits. you want to control everything. you want to control the message. that is the only way you can deal with that. >> he has done nothing to remove that tendency. that is a problem. it is a completely energy dependent economy. he has done nothing to reconstruct the economy. in the entire time that he is been in the party. anna: including in the technology sector. they set up the technology campus. maybe they have in their minds that if google and twitter are forced to leave our data in the country, this made bring about

more opportunity for the technology sector within russia. >> well, good luck. it isttom line is that less open than it was 30 years ago. he has done nothing to diversify. it is getting very bad in russia. it is not going to change his popularity. -- it is a very difficult environment. turkey turned the screws on the tech sector. it is easy to move engineers out of russia and put them in eastern europe. peter, thank you very much. tim, thank you as well. next hour -- he guy: more on the slowdown in the manufacturing sector.

we are live from hong kong and shanghai. stay tuned. we are back after the short break. ♪

guy: china's manufacturing contraction -- pmi slumps to a three-year low. anna: australia holds. the rba leaves rates at 2% as the week australian dollar cushions the economy from slower chinese growth and lower commodity prices. guy: merkel picks up on migration, warning that the agreement is at risk. she joins a press conference at 9:00 this morning. welcome back to "countdown." anna: welcome to the second hour. let's tell you what's been happening in china.

we have had the data out for the chinese economy. the manufacturing pmi. guy: this is the manufacturing number -- this is the chart. a three-year low, highlighting the decline we are seeing in the economy. remember, anything sub 50 implies contraction. we are seeing a slowing chinese economy once again, showing up in data in dramatic fashion. it's interesting because you have at one of two ways. there was a huge rally over the last couple days or you could say it's starting to fade. anna: it's all about context. backree sessions we went into a bull market, up 27% on three sessions. oil,over $50 a barrel for the largest three-day increase of 25 years. but it is off a low basis. guy: it came down a long way but you can see it stagger higher

over the last few days. this is -- it is beginning to stall a little bit, that you are seeing the legs higher on the back of opec saying it is looking for a fair price. we are also looking at the u.s. saying that outfits could be lower -- outputs could be lower, maybe forcing oil higher. anna: are they ready to have conversations with other drilling nations about possibly reining back on production? this raises questions about the global economy because oil going down wasn't as good as people thought it would be, so the global economy -- is this better news? that has not been a wholehearted conclusion. guy: oil stocks did very well yesterday, but the market didn't. anna: the broader market in the u.s. faded, down 1% on the nasdaq. back, we sawircle the futures overnight as a

result of the chinese data. u.s. futures have faded a little bit as well. to factors there pointing to a negative story. anna: we are looking at a broader conversation this morning as well around migration, around the themes we are seeing on a daily basis in our newspapers and on this , about what is happening in the mediterranean and people moving from syria and other places. is europe doing enough to solve the migration crisis? angela merkel is talking about the threat of the movement of people, about how it is under threat as a result of what she sees happening to the east. we have hans nichols reporting on the story. get in touch with us on twitter if you want to have your thoughts. guy: please, join us. let's find out how asian trading is doing.

zeb eckert joins us now. zeb: hi, guy. hi, anna. we are seeing shares around the region today decline in the wake of that official factory gauge out of china, the lowest level in three years as it came in during the most recent month at 49.7 in august. we haven't seen a level below that since february. the shanghai composite is down under 2% today. and seng is down under 1%, we are closely watching the chinese shares. among those stocks on the hang seng that are moving -- a big gain for oils. you were talking about oil a moment ago. after china is doing particularly well. we are seeing insurers going up today, and real estate shares, real estate investment trusts up about 1%. closely tracking airlines

because we have seen a significant move of the airlines in the region, this on the rise in oil prices. that has had an impact as well. it is having an impact today on the asx 200 in sydney. is rising 3% on the back of oil prices. air china, one of the big decliners today in shanghai and hong kong, this on the higher oil prices, but also on antitrust case that will now go to trial in federal court in new york. that is because air china, air india, and air new zealand not able to convince a judge to rule in their favor. it now goes before a jury in february. i told you about the hong kong market. the shanghai had a 2% drop for the shanghai composite, and we are closely watching the japanese market. the yen has been advancing today on this safe haven play as investors tried to figure out the future of china's economic slowdown.

it had a precipitous decline in the nikkei 225, and as the yen goes up, stocks go down. this is a 4% drop -- we don't see these numbers typically in japan. not many leading on the upside. that's where we are in asian markets -- investors taking risk off the table as china continues to reflect. anna: thank you, zeb. guy: the chinese day that it is -- let's work our way through the data. the official factory gauge pmi dropping to a low in three years, 49.7. anything below 50 signals contraction. allan is standing by in shanghai. the manufacturing data -- not exactly great at the moment. paid to attention is

this? how much should we read into this? give us a sense of how it relates to the stock market and how authorities respond, how it feeds back into the devaluation story. put that sub 50 number in context for us. allan: well, the manufacturing data is very important, but i think what is more important -- tuesday was very bad, but it is believed that manufacturing data will improve in the months ahead. we know that the chinese government has shut down a lot of these factories in beijing ahead of the military parade. we should expect the ramp up once the parade ends next week. another reason why -- yes, the data was bad, but there is reason to believe that things will improve, because there have been a lot of measures in the past few weeks, cutting interest rates, reserve requirement ratios, increased spending, increased bank lending. but we haven't seen anything down trickle to the economy.

maybe as early as september, we will see an uptick in manufacturing. finally, in regards to the stop market, there is a believe that maybe there has been too much energy on the stock market and not on the economy. we know the first quarter gdp numbers were in line with targets. while consumer spending held its in ordere last month, to cheat a 7% growth point this year, they have to do more to improve manufacturing. that is going to mean more aggressive monetary easing. may be in october we may see more reforms and other measures to curb overcapacity and send the price declines, that has really hurt the economy. anna: allen, thank you for joining us. guy: now let's go to see what the effect around asia is on the

equity markets. i want to show you what the european futures are. let's focus here on this priceline, the bloomberg fair value compilation. at the moment, you have 50 down ftse downou have se by 2% and at the moment the indication as we will see a soft open. anna: let's talk to peter toogood. peter, does that look sensible to you? bigger numbers, bigger losses in the context of everything we have seen in august, since the global financial crisis? does that look sensible? peter: again, i think the chinese number has been in trend for a. restructuring, the chinese economy, moving away from manufacturing. i think this threat between the chinese stock market and the

economy is very curious. i hear a lot of commentary now saying, oh, look, it goes down because the stock market changes. a lot of people aren't examining the pmi, why it is real. there is a lot of truth in that. underneath it all there is this reform agenda, trying to move the economy away from manufacturing and industrial production into something more holistic. guy: did they blow that away by devaluing the currency? peter: i think it was a panic measure, yeah, and their stock market is even more insane. you can't stop the stock market going down. it is still going to be the same point. it was crazily and insanely priced. it is not a reflection of a good economy. the economy is slowing, industrial production told you that. sorts ofall factors playing into it.

i don't think it will be a hard landing unless -- guy: so this is a five-year electricity chart, showing electricity consumption. we will get the director to bring this up. this is the back end of the chart. peter: it is, and it is confirmed with the numbers. year-over-year numbers are negative. anna: chinese authorities might prefer to look back on august 11 as an attempt to structurally change the way the chinese currency is traded, to make it more open, to get into the global fold. a knee-jerk panic response. we have had guests say that same thing. peter: if you look at it, everyone is doing it -- including the europeans until recently. it's one big devaluation game, and part of the pressure is that you are in sentiment mode.

a lot of drivers are not necessarily economic ones, they were asset price fluffing, north central bankers. factorshave noneconomic -- the economy is better than it was three years ago and you are having the same effect in the stock market. i don't think it is about that -- i think it is a participation think, a nervousness thing. they are tough without any real understanding, other than promising to make a wonderful. anna: the rest of the world is in seem to get excited when the chinese equity markets were going up. the ratee downside, across seems to be -- peter: to be fair, most investment professors come on this show, other commentators, saying the chinese stock market was insane. genuinely insane. -- lots of people came on saying -- don't get involved. 6% up in june and flat for the year.

that is what a bubble does. i don't think it's a reflection of the economy, which has been slowing, and is completely unrelated to the stock market. some of those stock markets are not egregiously priced. i'm not suggesting that the ftse is particularly expensive unless you have a negative view of commodities. times --are only 12.5 i don't think they are that expected. the average stock in the u.k., they are more punctually priced. the u.s. as a challenge -- it is expensively priced and disconnected from earnings. 2009 to 2012, they were saying -- for the short-term -- i am surprised -- i hope they would push it higher next week and give everyone a chance to get out. i is surprised it was going down. it isfalls now, interesting that it is going down now.

i think that is a bit unnerving. until45 minutes australia start so we will keep an eye on that. guy: we are down by around 2% at the moment on the ftse, cax, and dax at the start of the morning trade. 45 minutes away, plenty still to come today. anna: peter, thank you. he stays with us. guy: we have less than an hour to go until the market opens -- we will bring you other stories need to be watching. here is our data you need to keep an eye on. 8:55, we willp, get those numbers. guy: q2 gdp -- the commodity story. we are putting it all in perspective. anna: we like to keep it fair. u.s. august manufacturing at 3:00 u.k. time.

guy: we will take a break. we will be back. 7:15 here in london. ♪

guy: it is 7:17 in london, a: 18 in frankfurt -- here are the stories you need to know. anna: chinese stocks have extended the biggest two-month tumble since 2008. an official factory gauge dropped to a three-year low, and concern grew over the effectiveness of government intervention. the official purchasing managing indexed was 39.7. guy: european stock split lower as well. australia left interest rates unchanged at the impact of lower commodity prices. keptovernor and his board the cash rate at a record low 2%, as expected, following reductions in may and february. anna: the biggest three-day

rally in 25 years is heading the pause button today. futures of slid 4% in new york after surging 27% in the three yesterday, the most since august, 1990. august jumped to the highest in a month after opec said it was ready to talk to other producers at fair and reasonable prices. guy: u.s. futures are retreating this morning. the dow jones is down more than 1.5%, the s&p down more than 6% after a large monthly drop. here in europe, we are looking like we will see a fairly low stock. pointing to a 2%+ down turn to trading. anna: how ready are you for the future? have a question for a tuesday morning -- a heavy question for a tuesday morning. that is what is being asked at the futures trend conference. caroline hyde is there, joined

by a man looking at the next energy revolution. caroline, good morning. caroline: good morning, anna. looks as though it has -- here we are, right here at the ubs global leadership debate. this is all going to be about thinking about future trends. we are here in mclaren for leadership center. this is based in walking at the moment. i will bring you so much of insight in just a few moments. guy: once you can hear yourself think and we can hear her. peter toogoode, is here. peter, u.s. futures look like they will be opening soft this morning. european futures look like they will be fairly soft as well. you were surprised by this. how do you trade this?

peter: too hard. it is going to find his own levels, to the point of august being volatile. a lot of people will come up today and hit the send button. i still am inclined to think in the tactical short-term you may get a chance to get out, but october into october is going to be messy -- but september into october is going to be messy. have a rate decision and that could be a shock. if you look, it's not as bad as we are making it out to be. it is not a real economy event. you anticipate in a stock market, and what we are anticipating is emerging markets, potential changes in monetary regimes. obviously not europe at this stage. anna: what about the oil price

the last few days? up 27% in three days. that is off the low level, a six-year low, but those percentages make people nervous. what does it do to your assessment of the global economy? peter: the market is looking for a sneak peek from opec -- if they will do something meaningful. russia and others are having chats about the same thing, about stability. in either russian are saudi arabia can have twe prices low. bases, incut costs the bigger oils will adjust to the price. tracking can be very effective, 's more to do with how efficient fracking is. saudi arabia is thinking they will drive the price down, removing the competition. they are probably recognizing that is not the case. i suspect there are rumors based

on fact and the fact is that saudi arabia cannot afford oil at this price. he did spending and all the other things it has to have a high oil price. guy: how does that affect the u.k.? peter: i don't think it will have -- guy: there is another way of looking at it. the flow of money into the u.k. economy over the last few years -- we run quite a big deficit -- peter: continuously. guy: continuously. a lot of that is ported to property. once you start seeing commodities coming up, that is going to mean that that flow drives up. peter: only 2% in london, mayfair. it has been slowing for a year anyway. guy: you don't think it will have any effect? peter: while mr. cameron is not necessarily keen. half a billion disappears from corporate accounts every year. there is lots of money that goes

all sorts of places. i think what has been most interesting is the so-called energy beneficiary affect. secondarily, people drive currencies -- does it make any difference. most, butenefited the it doesn't make any difference. poundsra 10 because the car gets a million miles to the gallon -- i don't think it will be that damaging. anna: well let's go to the good thing, then. it needs some stability. peter: commodities will be great because commodity nations are consuming nations, and we are handing them to the japanese and the germans. arguably it is not a negative thing for commodity prices to have stability. that will help countries like brazil and others that are in some torpor because of what happened. -- super cycle gave them

they spent time performing or doing something productive. i wouldn't get carried away. guy: what do you think we will do over the next few years? peter: if europe is right -- guy: then oil has a pretty solid ceiling. ther: and here's one of biggest investors in new technologies and green technologies in. they are doing it for a good reason. all theseiciencies, things tell you -- you are always going to find a way around it. i thought oil was going to run out in 1989. the 40% left in the oil wells, the extraction technology didn't exist. cycle.e that super it has just stopped doing that. i don't think everyone is surprised by copper falling down. in the case of oil, it is a supply issue.

i think they will find a way of making the price stabilized. medium-term,n the very bullish for the global economy. if energy prices are lower that is more money in our pockets. anna: and in all this turmoil, emerging markets -- peter: brazil, turkey. i think things like mexico -- things like the drugs problem they have had to deal with -- those seem like -- india is probably relatively immune. to it is a very closed economy. when you see the slides you think you want to buy into them, but i would not look for russia and the chinese stock market. anna: peter, thank you very much. peter toogood stays with us. things looking negative for the

equity trade. guy: let's show you what exactly is happening. this is the line you want to look at. this is the fair value calculations at the bloomberg terminal. a softere we will see open to european equities. ♪

anna: welcome back, everybody. 7:30 here in london. here are the stories you need to know. guy: the biggest two-month tumble since 2008, an official factory gauge dropping to a three-year low. for august wasi 49.7, and anything below 50 equals contraction. is warninga merkel people to agree on quotas for the travel zone. aey are expected to take in hundred thousand refugees, more

than any other eu state. merkel is due to meet with the spanish prime minister to discuss the issue later today. causing panicist in the stock market. regulatorsecurities was planning an exit for support measures. >> i am sorry for what i have done. i should not have done this just to be sensationalist and catch people's eyes and such great damage to the country and its investors. anna: let's get to hong kong for an update on asian trading. zeb eckert is standing by with the details. it seems like the number out of shanghai earlier on in your trading day is not going into an impact on future is here in europe and into the u.s. session. tell us what is happening now. zeb: that chinese manufacturing being thenufacturing biggest mover to the downside we have seen in quite some time,

impacting stocks today, the august selloff right into september. let's take a look at the shanghai composite, down 2% in the session. hang seng china enterprises index falling as well. the oil producers have been living on the upside, along with property names and insurers. aia is up 1% and the biggest mobilephone company is advancing. it is all contributing to that decline of 2%. chinaasia-pacific index, manufacturing strengthening. it depends on china's supply. we see australia, which exports commodities. the asx is down 2%, bucking the trend. givingee qantas airways us reason for hope on a day when airlines across the region are falling precipitously. i mentioned some of the stock movers relative to the oil-based -- that is where we are seeing

buying activity today, and quite a turnaround in oil as you noticed, even with the chinese economic numbers. looks like we will have a turnaround in stockings in china. these are all firm advancers in the market just a short time earlier. macau casino shares were in a mixed position due to the latest forecast of gaining revenues, coming in well short of expectations, adding pressure to the likes of galaxy entertainment. sands china, a major player, is seeing in advance today. in a declining market, we see some winners here. the only winner in the japanese market on this day has been the yen. safe haven but stocks have been on a firm negative footing. these are the movers and the downside. yu cajon rubber is down --

okohan rubber is down and a lot of questions are left unanswered. anna: zeb eckert joining us from hong kong. guy: a big move in tokyo overnight. we will see a fairly substantial move -- day one, back to school for the european equity markets. looking at, we are the bloomberg terminal fair value calculation. cac down,wn 2%,, ftse playing catch-up. looks like we will see a negative open here in europe, a strong negative open. some may have surmised that traders are returning to their desk pushing the buy button rather than the cell button, but it looks like stocks are on offer this morning. oil is back in the bull market less than a week after hitting a six-year low. this is a signal that opec may cut production in the future,

and the u.s. lowered output estimates. james heron joins us for more. james, is the oil glut over? not yet, but it is getting smaller. they are using a new method to gather data, but ultimately we are expecting the surplus to start gradually diminishing by 3 million barrels per day. next year, it is suspected to be i the end of the year and the market will be balanced. guy: when we look at how technology is changing the nature of the game at the moment, when oil first came down and everyone was expecting the shale guys to roll over and go out of business, they haven't. how do we track and understand the evolution of how that technology is going to continue to implicate the supply side of the equation? james: it is very difficult, and that is why i think we are seeing volatility. these guys are under a lot of pressure, but this is an industry built on innovation.

they are still innovating, still cutting costs, focusing on the most productive areas. it is very difficult to say -- you can say with confidence that, yes, the surplus will diminish, but how quickly as the big question. anna: is opec going to cut production? it was interesting to see this monthly newsletter, talking about conversations with a fair price. does that mean they will be talking to other producers about the floor under the price? we have seen it bouncing. there is a lot of pressure within opec from countries like venezuela, which have great economic problems. the question is when will the saudi's change their mind. there is no indication they are doing that. onboardudi arabia's board, nobody like mexico or russia or anyone else -- it wouldn't be in their interest. guy: they haven't thrown in the towel yet. they are admitting that the strategy is wrong,. but it's not going to happen james: the numbers point to the

strategy ultimately working next year. the production is due to decline for the first time since 2008. this is what affect gains -- they want to regain market share. next year, they should do that, because demand will grow to more than one million barrels a day. anna: james, thank you. let's look once again to what's happening to european features. they are getting a little better as we get closer to 8:00. guy: they are warming up a little bit, a little bit of affirming going into the opening. we are now only down by 1.7%. it is firming up a little bit. anna: ftse is a little bit messy because it was closed yesterday. it is reflecting on u.s. trading. the euro stocks number is down by 1.8%. guy: still, a fairly substantial move. tokyo was down very hard overnight, and u.s. indicators

are also showing we will see a soft start in the states. nevertheless, that chinese data is continuing to have a substantial impact. anna: ok, let's get an investors take. we are joined now here in the studio. good to see of this morning, chris. we are looking at the futures, and try to interpret them with the new data we have had out of china, a three-year low in that pmi number. are you surprised if we see another leg of selling this week? it seems as if the markets are in negative mode once again. chris: we have clearly come in september on a pretty weak footing. most people like myself know that september is normally the worst month of the year. it just has a very bad track record in terms of stock market returns. but the fact that we all know are means that the losses put forward into august as everyone positions for bad september. it's a little bit of doublethink

going on at the moment. i think that we are probably getting toward the end of this particular squall, because we have had high turbulence over the week. with a question is if we have had a climactic change as a result of the losses. --: is your sense, though is this the right reaction, under overreaction? quantifier qualify what we have seen. a great question, because your instinctive reaction is to say it is an overreaction. i think it is probably about right. we have been worried for a little while about china, and the fact that the behavior of the authorities seem to the line the official story of managed growth decline. if you feel you are in control, you don't tend to do things like intervening for the stock market. the actions seem to suggest that something else was going on.

we are worried that it hadn't been priced in. i think it has now been priced in -- we are getting there. the immediate news flow is being factored in by markets, but it really is about the trend, whether the trend has been damaged in terms of the economic reality and in terms of the stock market prices. that is what we have to work out over the next month. anna: they are not always related to each other. was this very much a financial market events that we saw? with an underlying, weakening picture coming out of china anyway? chris: well, the stories we are getting out of china, e to a at every investor's ultimate fear, that we have had several years of good times, and the bad times must inevitably follow. we'll have concerns about whether the underlying problems of the great financial crisis have been solved in the last few years. we know that we are still beset

by global imbalances. landing,has a hard that could bring all that back to the surface. wei think that is really why have seen this volatility the last few weeks. markets haveide, their own corrective mechanisms built-in. we were talking about the falling oil prices. that is actually a benefit to western consumers, and it is one of those ways in which the imbalances can start to work themselves out. savings surpluses and nations which have exported commodities. we have had deficits in western consumers. falling oil prices means that we get cheaper fuel. surplus nations, slightly solar surpluses, but he gets cycled back into the west. all the stuff going on under the surface and this is why it

matters, why it has the potential to deliver the volatility. guy: are u.s. equities extensive? chris: of course. they are expensive if you take simple historic valuation metrics, but we never -- i was going to go on to say -- we have never had interest rates as low for as long as we have. that's what justifies the share prices. as long as that remains the case, valuations are high, but justified. eyeing up emerging markets and the far east and thinking -- if not now, when? i think they are cheap enough -- i think they are certainly within 20%. fall another must 20%, but if they do fall 20% -- anna: you're in. chris: they may be cheap enough already.

it depends on whether or not this ball keeps rolling. 20%, i meanithin that as a positive. guy: yeah. chris: we are in the last leg of it. anna: chris, thank you very much. chris stays with us a little longer. guy: coming up, he will break down the data that you need to watch ahead of the market open, which looks like it will be a fairly soft one. ♪

guy: it is 7:46 in london. here are the stories you need to note this morning. anna: chinese stocks have extended the market's biggest two-month tumble since 2008, and official factory gauges dropped to a three-year low, concern growing over the effectiveness of government intervention to shore up equities. the official

purchasing management index fell, down from 50 in july. below 50's and contraction territory. guy: european stocks are slow as well. japan left interest rates unchanged at the impact of low commodity prices. the australian government kept the cash rate at a record low following a reduction back in may and february. anna: u.s. index futures are retreating this morning. the dow jones is down about 1.5%. the s&p ended the month for august down more than 6% as it suffered its steepest monthly drop since 2012. futures are down -- let's show you what the european store looks like right now. let's show you the calculation we have. this is the european picture of the cac, down by 1.6. ftse playing catch-up. look at this price on the dow

and s&p. this column here is a fair value calculation, and it shows you a softer open both in europe and the united states. plenty of time before the u.s. open. anna: let's get to nejra. things look a little bit softer -- some individual stocks are on the move, as well. nejra: there are some stocks to watch. definitely keep an eye on those energy stocks, with the moves we have seen in the oil price over the past three days, coming off its highs today. i want to focus specifically on rexall, because it is going to be removed from the euro stoxx 50, the blue-chip index. alone, rwe is getting

knocked off the benchmark after his shares dropped 48% this year. they have been dragged down i a slump in electricity prices. both of those shares are due to come off the euro stoxx 50 as of september. rwe has been on that benchmark for 17 years. both of those could move slightly lower at the open. and am also keeping an eye on makes medicalich equipment for the treatment of neurological disorders. earnings today -- net loss was wider than expected. it didn't keep it's for your forecast, though. anna: thanks very much. nejra on the markets. guy: let's get back to chris willey. we talked about the valuations, about how europe it is set up, about u.s. valuations. when you are sitting down, designing a portfolio, how hard is it actually to get a grip on

what the earnings story is telling you versus what market value was telling you, put a get together into a coherent narrative? chris: i love that question, because when we do that, are investment process is built around four lenses -- valuation, momentum, growth, resilience. those are the four things we think matter. by going through all those indicators -- they are telling us at the -- we felt that growth had gone from a green signal to more of an amber about six months ago. because of the sharp slowdown in the u.s. and the problems which are clearly coming out of asia. so that has been kind of neutral. valuation i think is neutral. buts pricey in the states, justified if you believe

interest rates remain low. pretty cheap in europe. definitely cheapen asian emerging markets, looking for a catalyst. nowiment was positive, clearly negative -- that is a positive. so you have a green light on sentiment. we really have that flag very strongly at the beginning of last week. that only leaves momentum -- the big and imponderables right now. week,mage was done last but a number of support levels were completely taken out. we are now into no man's territory, and the worry is that it will take quite a lot of energy to get back up to the levels of just a couple weeks. at that point, it may be quite tired and vulnerable to further negative news flow. have 2011 all over again, where this is just a thin period,hey had a messy

and we are seeing the full trend . guy: that may play an important part. anna: if you were to think about thestrategy, where would threats surrounding and effects for an emerging market weakness come from? this that show up on the dashboard, back to those four lenses? chris: one of the dispiriting things at the moment is that we are still in that narrative of currency war. that has not changed in the last five years. the americans were added, then the japanese, the europeans, now the chinese are reversing to their old ways. so i think that remains -- what we are really grappling with his the sufficiency of global demand, which means growth is being redistributed around the world by currency shifts. i think we just have to accept that. china, for instance, is now topping out declining

populations. that has been the case in japan. that makes it hard -- that is a drag on overall global growth, and that is something we have to face up to. it is livable but it means we have to get a lower growth rate. guy: fed -- september, december? chris: you have to care. i do think it will be september anymore. i think that was nailed a week ago. you can always bet on the fed to be dovish. but they are itching to do it, aren't they? i think probably still by the end of this year. but it is going to be a nudge and a wait. chris, thank you. guy: german unemployment at 8:55. canada is in the mix at well. anna: canadian q2 gdp -- will

that confirm two quarters of negative growth, and a recession for that commodity related economy? guy: u.s. manufacturing data at 3:00 p.m. u.k. time. anna: minutes away from the start of the european equity trading day. jon? jon: the city of london is getting back to work -- not a good move. the dax is giving out right now. i imagine it has a lot more to do with the chinese pmi number and not so much to do with the long reign in london. outside that data, if you want to read on the chinese economy, look at south korean exports, falling 14.7%. the biggest export partner -- china. that weakness is spreading. we will talk about the chinese weakness as well. then at it: 10, oil. my producer and i had a

conversation about what we wanted to cover and he turned and said -- did you ever think that we would have accrued it down to $50 a barrel and be in a bull market? that is where we are -- a 27% surge in three days. we will break down what is going down with crew after the break. anna: thanks very much. we are back in a bull market on oil prices. doesn't sound right. stocks are looking that rosie -- the market open, coming up. a very soft open. these are the fair value calculations -- that is how we think it will open. anna: that will do it for "countdown." "on the move." ♪ .

jonathan: good morning and welcome to "on the move." i am jonathan ferro. moments away from the first day of trading this september. leaving behind the biggest monthly drop since 2011. let's get the morning started. china's contraction, the of for -- at official pmi slumps to a three-year low. a story ahold the rba leaves rates at 2%. a leaves race and to the rba leaves rates at 2%. futures climbed to his 7%.

the pmi back in a bull market. -- futures climbed to 7%. futures down by 92 point. that's futures down by 168 points. less than a market open. reporter: yes, indeed. a drop in august for the stoxx 600, the worst month since 2011 for you european stock volatility above you as volatility and yesterday we saw but infinish flat negative territory. let's see how markets are finishing. them moving lower. the ones that have opened so far. ftse 100 was closed for a bank holiday yesterday. it is down 0.9%. cac is down. gaugee manufacturing dropped two