ryan: syriza returns again for the they have a stronger than expected mandate. testing times. apologizing over the emission scandal engulfing the german carmaker. going nuclear in beijing. the chancellor george osborne urges china to back british infrastructure after he opened the door for a chinese design used in the u.k..

welcome to countdown, i am guy johnson. let's tell you what you need to know about what is happening in those markets out there. this mondayen up morning? how do we figured out from here? us?e does the story take at the moment, we have another negative application of the 1.5% we dropped friday in the u.s. we are down, not by much. we have a slight negative ditch. that is the u.s. close. i want to highlight some things for you. let me show you this chart. this is the hero dollar. goldman sachs has an interesting call. that is likely to add a little bit of down trajectory to the euro-dollar rate. up to $.10 could be coming off. watch out for that one today. the other thing i want to highlight as well today is to watch out for vw.

how much pressure will this emissions scandal added to the vw stock? it was falling friday. what i continue monday morning? what iset's talk about happening in asia and find out what the market up take is from there. we have a bunch of things happening. >> it will bunch of things are happening and is a down day for the market. check out the pacific index. it is down by 2% now. this is following the selloff in wall street friday. investors continue to interpret the federal reserve decision and what it means for the asia-pacific. that uncertainty is having an impact on emerging market currencies. we see a good news, relative to the malaysian ringgit. they are very sensitive to fed

tightening. as for equities, this is what we have. you can see red across the screen. shanghai is a notable exception. she gets ready -- getting ready give his visit to the united states. look at hong kong. it is down by 1.25%. these industry groups are moving today. you see property shares falling. this is the flagship company. there are others that are bucking the trend. utilities are doing well at a 120% gain for hong kong electric. currencies have been quite active, following the australian market. look at this. 2.5% decline on the equity market. it is across the board in terms of industry groups, from minors,

to oil and mining services companies. closely.atch that there are some telecom names in there. the chinese news organization is reporting that rupert murdoch has heard from ping himself, telling him china is open to foreign media. a news clip shows. sense of howyou a the currency markets are performing, we are seeing investors piling out of risk. currenciesg market are not doing so well in this session. 2.6% drop. the casinoking names, which are falling precipitously today. downy entertainment is 2%-3%. it is a continuing concern about the strength of the gaming sector. can it change fast enough to be a diversified entertainment venue that will make money? that is the big concern.

back to you. japan is closed until wednesday. maybe they are celebrating the victory over south africa in rugby. let's tight about the events that will dominate the agenda of this week. wednesday we get readings for the euro area. thursday, watch this one. the eagles for the rest of his political term. doing little to reinflate and revive that economy. you do not want to miss that. attention to that. seconday, we get the call of the gdp out of the united states. that is the data that will come at later today. it is a little bit quieter. tsipras has secured a surprisingly strong wind in the greek collection. it was too close to call. his syriza party will perform a oflition after winning 35.5%

the vote sunday. he made this speech to thank his supporters. >> i want to thank the young people that gave this fight. i want to thank everyone. even want everyone put us on the firing line, we proved to have close ties to the working classes. joined by tom in athens. tsipras has done well. known expected it to be quite the strong for him. tom: that is right. he beat the polls by a long margin. he beat the expectations by many in his party. we were outside with the result less night. thee was relief asked on faces of many of his colleagues there. this was a man, do not forget, who took greece to the brink of exit from the euro. clammed up

completely, the banks closed for a number of weeks. the greek people have given the press a second chance. the one caveat to this is the voter turnout was very low. a historic low of 56%. an increase for the nationalist party that will give many paths for thought -- give many pause for thought. he has managed to carve out the rebels that went out to form their own party. he now has a stronger mandate. he has just five extra seats with a majority in parliament. he will hold that coalition together. he feels confident, with an element of caution this morning, looking ahead. if you number of tweets already from european leaders. the latest from dijsselbloem. how will the rest of europe view this? tom: with a sense of relief, i think.

of the greek people voted for pro-bailout party. he looks forward to working on ece needs togre push through. ying,ve heard from banks sa this reduces the political risk for greece. there are huge challenges ahead. the targets that are embedded in his tale of deal would mean economyeeds to grow the quickly to meet those targets. if they do not, they will have to cut back on budgets further, increasing the pain of the greek people. but with the former finance nestor and he did say he is wary of this, but he knows there is a big struggle ahead of them. he will be pushing to soften the blow of some of the bailout reforms as well. give themors will not

a great deal of breathing space. guy: our man in athens, tom mackenzie. let's get another take on the story we got over the weekend. the former greek finance minister joins us now. good morning to you. .our thoughts on the results a little stronger than expected? so, yes.k a little stronger, although nobody knew the results. we were surprised with the referendum by how strong he came out. we are not really surprised by what what happened less like. the greek people are tired by the old politicians and need a change. they are willing to forgive all of the mistakes of the previous government. nothing negative can stick on mr. tsipras before the greeks start paying. we will have to watch and see after they start paying real estate tax, after their pensions come down, whether he continues

to be popular. there is no longer any political risk in greece. the government has a horizon of four years. it is up to the government to implement the reforms. practicalfted to matters. , getting credibility out of capital controls, and bringing back positive growth, hopefully, by the third quarter of 2016. guy: where do you think the big risk lies economically? we are dealing with a company -- with a country that still has banking controls, still has a economy that is strangled by the lack of access to a normally functioning system. how quickly can we restore normality to the economy? >> number one, the banks have to 40% ofpitalized because

the loans are not performing. this has huge and a lot the capital. we are waiting to see the stress test that will come from the europeans, from ssm. hopefully, they will not be as t the previous investors a trusted the greek banks. number one is the recap hotel a is the of banks -- recapitalization of banks. number two are the capital controls. if they are not lifted, the small enterprises will continue to go under. that is a big problem for the economy. the government lost credibility and has to gain it back. it has to do the right thing, and very quickly. it is up to mr. tsipras to gather together a good team, a team that works hard, that has a plan, and pushes. the previous government was too late back, to ideological, they

do have a work ethic. they kind of messed up. excuse andre is no hopefully, they have learned from their mistakes. hopefully, we can look into the future with optimism. whether i ask you about or not we now have a government that has the ability to start making significant changes to the structure of the greek economy? previously, it was all about battling brussels and trying to get a better deal in brussels. now, the attention must shift closer to home. maybe starting to deal with some of the closed off areas of the economy. maybe trying to deal with the story that surrounds the old establishment. how close do you think he can get to some of the targets on that one? >> i think, if he himself understands that reforms is a

democratic process, even a socialistic trust us, that he can sell it to the people. the pm himself has to understand that they have to bring transparency, fix the public sector, fight corruption. give powere things to the people in the end. he has to understand that privatizations are not necessarily bad. simplyu privatize you lease out the property for a while for someone who can run it better. this will bring benefits to the country. i think, the moment the prime minister understands this deeply, the reforms are not , for hisis policies policies, then he could succeed. guy: we will leave it there. it is always interesting to see you. the former greece prime

minister, turning us to talk about what is next. we are joined the practice had of eurasia. the challenge now comes closer to home, doesn't it? they dealt with brussels. lost, you make that call of her history. now it is about the details of the greek economy. >> the agenda is extremely challenging. i the end of the year, the government must implement tax reform, pension reform, privatizations. undertake a negotiation with creditors to secure debt relief. opennk it is a very question regarding whether this government will the competent to conclude all of those reforms and conclude all of those concessions. system seems to be simple at this stage.

there is still not a functioning economy. how can you start to get the ball rolling when you do not even have the basic elements in place to make that work? they need a strategy for dealing with mpl's. privatizing some of the banks. i think there is a consensus. more broadly, the germans and others, are looking to tie bank cuts to a broader progress across the program. this creates the risk there will be's -- that there will. they could potentially result in a recap next year. e disastrous for political stability increase. i think it is a really important point. this would of given tsipras a larger majority, with a more

credible party, with more competent administrators. partnerse of being with the independent greeks will worry the europeans, given what happened over the last nine months. the does raise a question with the government's willingness and commitment to move forward. guy: we clearly, ideologically is heavily left of center. all of the had dealings he has had with brussels, having understood the reality of government that he star the tax incentive. there is a more credible story surrounding him. he of the finance minister that is easier to deal with and someone say, less volatile. he has a few of the people around him that are not so easily influenced. what do you make of his political trajectory? mujtaba: i think on some level that is right. she will surround himself with a

slightly more competent economic team. the interim finance minister could well remain a finance minister. a lot of the degrees of freedom in the government will be constrained by brussels that will on some level, force them to move forward with reforms. these measures are unpopular. guy: there is a mandate here that could taken a long way. we don't need to end up in a situation where every five minutes he is calling another referendum on this, or that. he has a little bit of a political space to make changes. mujtaba: he has a majority of four people. knows that as long as he sticks to what he said, they will broadly support the economic klansman pushed forward. he will not lose ground there. mujtaba: the fiscal targets are still extremely challenging.

for 2016, next year's budget, this administration is already going to have to specify additional measures to meet the in 2017 and 2018. there are those that believe, and i on some level, and one of those people, that the greek lit ago system has proved completely of delivering substantial reform and consistency with the bella program. there will be slippage. where will that fall and what will the response be from creditors? mired in aompletely refugee crisis. will she be able to save greece this time around? it is a lot less clear to me. there are a lot of politics still to be done. thank you for your analysis. a bit of breaking news coming through. insurance over the past

couple minutes has had talks with rsa -- they have been terminated. there will be no offer me today. it is updating on its q3 trading as well. this is related to the talks that rsa talks have been terminated. coming up, after winning a past battle isthe next with the u.s. consumer. details with that story, coming next. the u.k. counselor george osborne set down his vision for a future with the country. we will look at his plan later in the show. plus, we will be talking anythi ng glittery. i. will talk about swarovsk we'll take a break. ♪

guy: welcome back.

let me tell you about the stories and you to tell you about. alexis tsipras is back in town. he won the second election with 35.5% of the vote. that was a bigger number than anticipated. economy is not as weak as it may look. describes a mixed, rather than disastrous picture for the economy. the sessions and china may be more thoroughly divorced from the facts on the ground. the u.s. will taken more syrian refugees. john kerry said the u.s. will admit at least 10,000 refugees over the next year. will settle tor 100,000 in the fiscal year of 2017. vw has admitted to

systematically cheating on emission tests. apologized, that it is now vulnerable to billions in criminal prosecution. it's going to hans nichols for more in berlin on this story. with kick off with the facts here. what did vw try to get away with? saying is the epa is that they installed the so-called defect devices. detects when a car is going under admissions testing. that, it releases less nitrogen oxide. there on the road, they have 10 times-40 times more than the allowed pollutants. when you have that on when you are driving on the road, you get more cap and torque. this deals with the beetle

diesel vehicles. ordered nextas journal investigation. they are pledging to quote rate with authorities in the states. yesterday, the ceo put out this statement. you can hear the contrition. we are deeply sorry that we have broken the trust with the customers and the public. we will cooperate fully with the responsible agencies with transparency to completely establish all of the effects of this case. volkswagen has ordered an external investigation of this matter. the models that are affected are -- thehe diesel models beetle, the jetta, because god, the audi a3. this is a challenge for volkswagen because they want to have a bigger footprint in the states. sale stateside were diesel vehicles. this will be a massive challenge and a big pr headache.

they will have to deal with the cost side and legal side as well. guy: you spoke with them at the frankfurt auto show. are any hints from any of them, the people that you spoke to, that this was about to happen? hans: none. either he did not know, or winterkorn is a cool customer. we'll wait and had not been fast enough to engage in the electric vehicle space. and you, they did not have a big enough footprint in the states. frankfurttalk in about electric vehicles. porsche unveiled the concept car, entirely electric. nothing directly or even bleakley, poke with legal hurdles in the states. are raising up to $18 billion in fines. that is three $7,000 per vehicle. this is a big issue for

volkswagen. guy: thank you very much indeed. now, coming up, drumming up business, george osborne is in china. more on that, when it return. ♪

guy: it is 6:30 in london and 7:30 in brussels. here are the stories you need to know. the press is back in power. sipris is back in power. withll enter a coalition small parties that helped him rudely for. according to a private survey, the report from china describes a mixed, rather than disastrous picture of the economy. china may be more thoroughly divorced from the banks on the

ground than we thought. the u.s. will taken more syrian refugees. secretary of state john kerry d states unite will bring in 10,000 refugees in the next year. in2017, they will bring hundred thousand. let's look at how the euro-dollar is trading. goldman sachs says the currency may fall $.10. caroline: it is a significant move. that would be 9% in terms of weakening. let's have a look at how much we could actually sink. we could reach as much as $1.03. the significant drop-off could be anticipated in the euro. it is interesting if you look at another function from bloomberg. it is the bloomberg correlated

weighted index. in the last six months, the euro has strengthened. it has been the second test performer, versus the 10 other developed nations we track on the index. it has been up more than 6% in the last six months. 620% to be specific. -- the the second backs second-best performer. goldman sachs says the reason qe could last, much longer until the end of 2016. until mid-2017. this represents a material upsizing of the original program. so, $.10, how much does that back up to the other analysts out there? it is actually pretty similar. when you're tracking what the anticipation is for the euro, you can use many functions.

these are foreign currency forecasts. when he logged into it only bloomberg terminal, they think we could fall more than $.10 in the next quarter. downthink we could fall $2.96, in terms of where we are versus the dollar. weakening over the course of the next few quarters. though, that is 7% weakening. goldman sachs is going above and seend where the analysts the weakening over the next seven months. back to you. chinaet's move back to with the state counselor. he is addressed concerns about the slowdown in his country and the decision to devalue the yuan. he said the chinese reforms will benefit the rest of the world in the long run. graph isaid the reason

not reflective of the state of the chinese economy. free from itst challenges and problems on the economic front. of course, there have been some ups and downs in the stock exchange market. given china's economic development, given the fact that china is a developing country. there are movements on the stock exchange in china. should not equal the entire picture of the chinese economy. demanda supply and determine the value of imb. imb, generally speaking, is quite steady in value. course, continue to

reform in china in various sectors, including the financial sector. years,ople look back, 10 or 15 years from now, they will w arehe market reforms no good not only for china, but for the rest of the world. guy: we're hearing similar saying things are not as bad as the headlines suggest. george osborne visits china in a push to boost the economic and cultural ties with britain. he says he wants a golden decade in relations between the two countries. david is standing by with more. what has been the main message that we have heard from george osborne? what is he trying to get from the chinese, what is he trying to say to them? what he wants is

integration. it says the u.k. was to be china's best partner in the west. observer, eroded eil, talking about the opportunity china is for the united kingdom. it is reflected in the delegation osborne is leading in china at the moment, and where they are going. they're not sticking to shanghai and beijing. they're going into the interior and visiting townspeople have not heard of. they are taking leaders from the northern part of the kingdom. there are cultural institutions being represented on this trip as well. you can see the head of the british museum, he is going. the head of the national theatre is going. it is a wide-ranging delegation that will be crisscrossing china over five days. that is all about integrating

into china, given, notwithstanding chinese economic growth at a two decade low. the future is that china will remain one of the fastest economies in the world in terms of growth. britain want to lock into that. guy: george osborne was taking selfies on this trip. david, talk to us about what is happening on the nuclear front. there is a strong desire coming out of london that china should lay a much greater role in the u.k. nuclear development story, both in terms of financing and designd. . david: it is a two-way road, isn't it. britain would like to see china investing in the u.k., in particular, in infrastructure. and in nuclear infrastructure. we have seen these guarantees for the hinckley nuclear power plant. this is something that china is also one of the investors in.

there has been an interview in the financial times with the and energy secretary. designed thend nuclear plant in essex. this is a message we're getting from the u.k., that they are willing to back maybe a chinese rollout of its own nuclear designs. britain as a jumping point. guy: let's talk about ping, going to the united states. what will we care about on this trip? david: this is an interesting trip. we saw him before he was the president of china. this time, he will be going there on his first state visit and it will have the 21 gun salute, the banquet at the white house. this is all about him pr

esenting himself as the leader of the powerful nation. it was almost seen as an anointment of him being in charge of the most powerful army in the region. now, he is going to the united states and he wants to be respected. he wants to hear that from the u.s.. issues,tanding, the such as fiber security. -- cyber security. guy: thank you. diebel is here with us. rley: friday was quite a day. closeet's talk about the and then the open. nevertheless, what are your thoughts and reactions to what we saw friday? ver --it is

that must equate, the situation is fine, or at least reasonably good. there is pockets of where he, but broadly speaking, they have achieved what they want to achieve. the fed is looking outside of its territorial borders. that is a bit of a game changer, as far as policy for the was is concerned. previously, we set policy for our needs, not everybody else's. it was about the dollar, about china, about volatility. these were the messages. if that is truly their reaction function now, it is a different game. guy: how do i calculate how the fed is thinking? babies lay it was data dependency and what is happening it was-- previously, data dependency and what was going on in the united states. how do i redesign my model? difficulties, is

the short answer. the answer to me comes from, if we are in a world where u.s. monetary policy is both driven by domestic factors, and by the international concerns, that's effectively means that we do care as much about what is going on in china and the eurozone, whether the ucb will do more. that has to play into what the federal reserve is going to do. on that basis, we are actually in a multi- polar world. rather than a u.s. centric, what they do everyone else will follow, we have this possibility for divergence. in that scenario, where the u.s. ucbraise rates, but the does not follow. it going a had different polar directions.

one thing for sure, is the volatility will go up in response. effectively, you have to that say for example, fixed income markets will trade -- back ofof dimon x dynamics like global inflation risks. equally, this sort of globalization of the framework investment flows become that much more important. as an example, the reserve fund we have seen from some of the asian-central banks to protect the currency or stem that cover for outflows, that kind of yhou-use -- asset-use if ou ou like. you are actually sing a flow of

the other side. guy: how much of this did we understand? now?uch clear is it is what i think that the fed outcome is so important. previously, i think that the sense was that the federal reserve will respond only to that which is in the u.s.. have been told that this is not the case. they will respond to other factors. that is how the markets have been viewing the world. we were kind of the living that we were going to be pulled back 1.0.rt of, version that is not going to happen now. how you value assets, it is a lot more complex. about what isk happening with alibaba. a $105 billion lockup.

the amount of stock became available. we are joined now. one of the names we will be watching out for very carefully is your hope. it is still a big stakeholder. in many ways, this lockup expiration is a much bigger deal. given up the majority of the market value is shareholding in alibaba. what we's look beyond are talking about just today. alibaba stock has been something we have all been talking about. it is a benchmark for china in so many ways. what happens more midterm for this business, now that we are tackles -- throw the shackles from the ipo? edwin: the big challenge for

alibaba, in the near term, is how to jumpstart growth. how to the growth going again. i think it faces several challenges, including, china's well-publicized growth slowdown, as well as the intense competition in areas outside of the economy. such as the online internet services. guy: in the tech world, what do people say about the stock size of alibaba? they spend hours thinking about what will happen next. how divorced from that story is the business and the way the tech landscape evolves? how the company is viewed from the tech community? about how thealk analysts view the share price

first. l, in of analyst fee the near term, there will be a fair amount of volatility. not just because the lockup is expiring, but because of the growth challenges. are wall street analysts out there who are competent in the longer-term prospects are a company that is essentially controls 80% of the still fast chinese economic arena. the terms of how the rest of the tech community views alibaba, i think, within china, there is a lot of healthy competition. are getting into a lot of the areas alibaba wants to get into. this is not even looking beyond china, where alibaba wants to spread its wings. thank you, edwin.

great to hear from you. lockup expires today. we set down with an exclusive interview. find out how the company is planning to get into the tech story, after the break. ♪

guy: 6:50 in london and 7:50 in paris. -- tsipris isack back in power. he will enter in a coalition with the small parties that helped him before. the chinese economy is not as weak as it may look. disastrous,er than pictured is described. investigation is ofnched after the ceo

volkswagen admitted it was cheating on the emission devices. it happened in the united states. the ceo says he is personally sorry. pay up to $18to billion in fines. the u.s. will take more syrian refugees. secretary of state john kerry says the u.s. will admit 10,000 refugees over the next year. that will bring the total number of refugees to 100,000 in the fiscal year of 2017. the previous number was 70,000. him, what by asking he thought to the response to the refugee crisis. ofi think the number countries that are trying to play a part, i think understand the human tragedy that has led to this influx of refugees.

they are trying to cope with it. at the same point in time, they have got to look at what resources they have available and how easy it is, and how they can better absorbed. far, andhere is buy in acceptance that this is something europe needs to do for humanitarian reasons. and the numbers they have had to absorb right now, is nothing compared to the numbers that neighboring countries in the region have had to absorb. the eu does have more financial resources available. >> is it fair to say that europe as a whole has not stepped up to the plate to shoulder the responsibility? prince feisal: europe is a

number of countries and not all of them have the same idea, or the same commitments. fair to tryk it is and brush all of them in the same stroke. people are trying to cope the best they can. this is a lot bigger problem than what originally had been planned for. prince speaking there. charlieing back in diebel. he is the head of rates. tim is here as well. let's get your first take. inpris was put back authority, the same kind of government. does this put it off of your radar now?

there is some political stability and we know the kind of programs they are signing up for. they have some wood to chop, in terms of their recapitalization. situation we are in a where they are dealing with the problem now and the europeans should step up and provide support down the line. field, some sort of left we're not going to do this type scenario, it is a non-problem. tim, he is back in and did better than anticipated. the question to you is, if i am a greek 25-year-old, with a university education, is this something that will keep me here? tim: it is hard to see how it would. the terms of the bill at are fairly prescriptive.

government's room to whatever on taxes, on spending, are very limited. the prospects were how things improve materially, it is hard to see how it does. unemployment is 25%, something like that. people have been talking about russia as well. many of these countries are suffering many of the same things. the economic downturn, leading to unemployment and reading to a smart,on where as a mid 20's person, educated, i'm not sure if i want to stay in the country. the highestion is it has been since late 2009. the numbers of people are rising, but what is different this time, is the very successful, smart, wealthy are leaving and going to germany, the look on belly, and israel. anywhere they can.

they're getting much better opportunities elsewhere. guy: economically, is that the rational thing to do, charley, do you think? do you see unemployment improving? in the short-term, the impact would be relatively minor. yourver a 5-10 year time, structural growth rate will be much lower. the talent leaves the country. that is the real problem. it is not like they are without problems anyway, at this point in time. it adds to the further long-term malais. it raises their economic potential in the long-term. well just the raw numbers of people leaving have not yet peaked, in terms of the wealth

exodus, it is a record. guy: where going to take a break. ceo al be talking to the little bit later on. ♪ ♪

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guy: syriza wins again -- great people return alexis tsipras the power with a stronger than expected mandate. testing times. an apology over the admissions scandal engulfing the german carmaker. and going nuclear in beijing. chancellor george osborne urges china to back british infrastructure after he opens the door for a chinese designed to be used in the u.k. welcome back to "countdown." the u.s. closed friday and was a little tricky.

there was definitely a risk. let's talk a little bit about how we are anticipating to open here in europe this morning. u.s. futures have firmed up -- we will get another negative open, though, probably down a touch. looks like we will see the ftse down. watch rsa at the get-go. we are not going to be getting the big insurance deal that we anticipated involving rsa. it is likely affecting the ftse. we are down by a little less than a percent in most places. looks like the european bond story is fairly stable. doesn't look like we will get that this morning but we have stayed pretty much level since we found out.

let's talk a little bit about the data we will watch this week. wednesday, preliminary pmi readings for the euro area. then the japanese prime minister will layout his goals almost three years after the election. maybe not delivering quite as much as we thought he would -- how does he revive the economy? fiscal policy seems to be increasing the story. friday, we get second-quarter gdp from the united states. all of that to think about. before that, let's talk about the asian market. zeb eckert is standing by in hong kong. zeb: good morning. it is a down day across the asian pacific. investors are trying to figure out what monetary policy is doing in the u.s. and whether china's economy will show any signs of picking up. let's take a look at the numbers. you see declines pretty much across the board. japan is closed today, through

wednesday. no action there. an interesting diversions here -- shanghai is up nearly 1 .25%. a curious move by investors. a lot of concern about the chinese corporate environment and overall economy. let's check in on some of the shares listed in hong kong. we have utilities doing well today, one of the loan industry groups that is advancing. hong kong electric, the main electric supply, and china mobile, the biggest mobile company in the world. mobile shares have been doing well across the asia-pacific. some have not been doing well. cnooc is doing particularly badly. let's take a look at what's happening in terms of industry movers. if we pull out and take a look at the msci asia-pacific index, excluding japan, you see all 10

industry groups trading lower right now. some of the biggest declines we are seeing in basic materials as well as oil and gas. those basic material stocks -- let's take a look and see what is moving. one area where we are seeing big declines is industrial metals, paper stocks, and mining. this is what we have -- nine are falling and four are rising. bhp.into, this is not just hong kong. you can see the concern in the marketplace. australia has had a significant move today. 0 -- check out this intraday chart tumbling out of the open, down 2.5% as stocks were falling today. chinaorp. president in has told rupert murdoch that foreign media investment is welcome in china. we have coca-cola in focus today, shares falling on

speculation that sab miller may launch a possible bid as a defensive move. finally, the sydney airport has a strike underway, a walkout by some customs and border patrol workers at eight international airports in australia. it is going to last for the next 10 days. they may impact your flight if you are traveling through's edney, melbourne, or any other airport there. watch out. guy: market news and travel news, we have it all covered. zeb eckert to joining us from the asian market. let's turn a little closer to europe. alexis tsipras secured a surprisingly strong win in the greek election after poll suggested that the election was too close to call. the syriza party will coalition with the independents after winning 35.5% of the vote. mr. tsipras made this speech to

thank his supporters. >> i want to thank the young people who gave us faith, from the neighborhoods of athens. even when everyone put us on the firing line, we called for the working classes. tom mackenzie joins us now, live from athens. tom, people said this was too close to call, but tsipras once again surprised the pollsters and delivered a decent mandate considering what has gone before. tom: absolutely. he was right in the firing line. you could argue that he put himself on the firing line by turning around after the referendum in signing up to the bailout, but yes, a strong mandate. an indication of that from a local newspaper, "the era of tsipras."

he has really ingrained himself now in political discourse, after winning in january, winning the referendum, and winning again last night. the next few hours and days, this is what he will be doing -- he will be meeting the president of the hellenic republic, given three days to form a government. tomorrow, he is expected to be signed in as prime minister. it involves implementing many of his bailout conditions. some carrots are dangled at the end of this -- 6 billion euros could be pumped into greece if these reforms are pushed through. but before that can happen the ecb is doing a stress test and review. another carrot is possible to be. -- possible qe. let's have a think about what went into this election -- from an outside perspective, we have

seen some discourse. analyst --ter and an he joins us now -- how to the polls get this wrong? peoplethey are pulling like us, who do polls for international policies. it said that tsipras was the dominant figure, but not the absolute majority. tom: i think from an outsider perspective, he can seem very confusing, what the greek voter wants. they obviously voted no in the referendum, and then they vote him back in. maria: [indiscernible]

citrus was a prime minister back then, who drove the dividing line the greek political system, who said myself and no one else. they decided to give a vote to tsipras. now they gave him the second chance. or we can say, the third chance. they trust him to implement his ideas and people voted within the criteria -- who will implement the memorandum, the agreement with our lenders in the way which is, let's say, most socially friendly? tom: and how much comfort should the creditors take from the fact that around 75% of the greek electorate voted for a pro-bailout party? maria: no, i disagree. syriza and the independents are

voting for the measure. pro-european, pro eurozone group. if you look at the election results you can see that those political parties who said that it is better to go back to the drop, are either not in parliament, far from the communist party. tom: what are the chances now this coalition -- he needs to team up with the independents. how difficult will it be for him to hold that coalition together as these tough measures are pushed through? maria: in the british government, the problem with serious. the independent greeks will have parliamentary group. however, syriza doesn't have so

many people. stable more parliamentary group than it used to be. tom: thank you very much. we are joined by the pollster in turnout and the voter was a historic low last night, around 56%. back to you. guy: thank you very much. tom mackenzie joining us from athens. let's bring in charlie. we are in an interesting situation. greece has got a little bit of stability, but there is not political stability elsewhere in europe. you hang the refugee story and the greek story side-by-side, angela merkel has enough on her plate right now. she doesn't need to be worrying about greece. how does that change the dynamic madea think? -- dynamic, do you think? charlie: it's like everything --

we are in a world where it has gone from a crisis to a chronic situation. everything is up for debate, everything is up for negotiation -- it is clear from the metrics you had on the screen that some fairly substantial, heavy lifting needs to be done to take greece and the greek economy to a sustainable path. i don't think the europeans have any appetite for real confrontation on that basis. i am assuming that they will be relatively forgiving in the upcoming negotiations. remembering that if you extend the time frame, the terms become a lot less onerous. the world has sort of moved on from having a greek crisis. -- in a worldt where volatility appears to be going up, we need to be thinking about the world. much to the right of my

distribution code of risk can i say this? charles: quite a long way. with what you are saying -- implying in the question of europeans not halfing an appetite for a big confrontation. it is a typical european dynamic, where having come up with a broad framework, things will go into a committee room for the next 16 months. but within that, if your starting point is relatively generous are relatively and how do these reforms get int implemented -- if you extend the time frames, everything becomes easier, and i suspect that is what we will see. guy: extent, extent, extend. charles, thank you. he will say with us. aming up, we will speak to ceo.

and 80% of dialogue revenue comes from apple. why do you think they are doing the deal? because 80% of their revenue comes from apple. we will have a conversation in just a moment. ♪

london, that17 in means it is 8:17 in frankfurt. frankfurt will be interesting today. let's tell you about the stories you need to know. alexis tsipras is back in power. the secondparty won degree collection and it comes with a stronger-than-expected mandate. he will make a coalition with the independent party. china's economy isn't as weak as it may look, according to a private survey. it was described as next rather than disastrous. insurance group will not be paying fines after its scrutiny of its accounts.

it would have been valued at $8.7 billion. let's talk about the stories that will be big in the frankfurt market this morning. volkswagend has a -- has admitted to cheating on tests for diesel. it is now vulnerable in terms of fines, which could go into billions. let's get to our international correspondent, hans nichols, for more on this from berlin. hans, looks like the vw stock will be hammered at the get-go. walk us through exactly what the company has done, walk us through how they found out. well, they got found out through the environmental protection agency. before that, there was a separate company that figured something wasn't quite right with volkswagen's in missions, so they alerted the epa. the epa found they had nitrogen fortypollution ten to

times acceptable levels. they had software that had the so-called "defeat device," software that overrides and changes the omission so you have more torque when you are driving diesels. they have pledged to cooperate and said they will help the next hurdle investigation. can sensement, "you that they see how serious this is." he is personally and deeply safety and that they will cooperate fully with the responsible agencies with transparency and urgency to clearly, openly, as completely establish all the facts of this case. volkswagen has ordered a next earl investigation of the matter. in premarket trading, their stock is down 10%. you can see why this is such a big deal. 26% of their july sales were

diesel. now, dealerships in the u.s. -- you cannot by 2015 cars or certified preowned vehicles. those are completely suspended as they sort through what is going to be a difficult pr challenge. guy: you spoke to him a couple days ago -- any hints that this was coming around? hans: he the trade absolutely nothing. they were full of confidence, talking about their new vehicles and what they hoped to do. they had a lot of optimism and big ambitions. you look at the criticism of him when he went to that board struggle. it is one that they haven't done enough on the electric front, two an admissions story, and also that they are not big enough players in the u.s.. their sales this year were down about 10% in the u.s. year-over-year, and on the electrical side, porsche did unveil a concept car that has an

electric battery. it is an electrical powered car. we will see if they bring it into production. that is the criticism of the folks i can group. lkswagene full slag anvo group. some 422,000 vehicles will be recalled. guy: thanks very much. hans nichols, joining us from berlin. let's talk about another stock that could be a focus. atmail is being bought for $2.6 billion. letting walks you through the logic around this. dialogue is a big company. you may not have heard of it, but you have probably heard of the company for which it relies on 80% of its revenue -- apple. why are they doing the deal? they could have some thing to do with that. the ceo joins us now for his first interview since announcing

the transaction. good morning. jalal jalal: good morning. guy: we have a system that allows us to look at revenues. apple revenues for your company -- 78.09%. that is the reason for doing the deal? jalal: well, we are very successful in the bull market, and it is fit -- in the mobile market, which is very concentrated. so you have to be with the top leaders. is that it has another growth story for us. everyone is talking about it. we position the company for the next generation of mobile. mobile up till now has been mobile phones, tablet, and now is more into things that you wear around your wrist, fitness bands. all the other things that get connected to the other machines and the internet are things that the internet of things

enables. the acquisition of this company -- the rationale is that we get access to micro control which brings these devices, and we get access to things like encryption, assuring the safety of the data packets transferred between different nodes in a network. of course, we have our own technologies that are crucial for sending data around the house and buildings to make sure the it is anonymous. guy: head of the deal come about? you have been looking for a transaction for a while. it didn't work last year. out of this one get put together? jalal: last year, we looked at ams because we were looking to enable our strategies with sensors. since then we have developed our own sensor strategy and we have a company that gives us access to that. we are on the lookout for other parts of the portfolio, and of

course atmel is in a great position to do that for us. guy: the chip is consolidating pretty quickly. we are seeing a number of big transactions. most of us feel defensive. how would you characterize this transaction? jalal: i think it is generally a good news story for us. it was position for the next five to 10 years. computing behind us, at the height of mobile, and now we are entering a new era of technology. connecting smart devices. that gives us a all we need. to succeed guy: people keep telling me the internet of things is going to happen. they tell me exactly the same thing. jalal: it is true. [laughter] say it is about to happen -- give us a sense of where we are in the process. jalal: if you look at the everyday objects that would be

that sort of thing, that is a good place to start. something that is very close to a lot of day-to-day use is in fitness and health, wristbands that people where. -- people wear. it connects to other things. then you moved to the smart home. you have things like thermostat, smoke alarm, fire alarm, which i'll get connected to your wi-fi. then lighting. lighting is the most significant move into led-based digital lighting, as can be connected, controlled, and download different light moods. distance,m from a play with the environment. things like that are examples of internet of things. people talk about bigger picture

-- those who take a few more years to come, connecting all the machines. we are talking about -- if you take the edge off those networks, the networks get connected together as you go forward. guy: once the internet of things story has started to come through, who will be your biggest customer? jalal: probably people who are nesumers -- honeywell, ge, labs, people who are really into smart homes. those are one class of customers that would come to the fore. guy: jalal, thank you. dialog, talking to us first here on bloomberg after announcing that deal. we will take a break. coming up, we will carry on the conversation surrounding what happens next on the economic front here in europe. we will speak to the economic

finance committee chairman about this man. greece is the story this morning. what does he need to do next? how to get the economy functioning again? ♪

guy: tsipras back in power. has called for an external investigation. carmaker has software that turns on pollution

admissions control only during government mandated emissions tests. both the the w story and the insurance story are likely to have impact on the european story this morning. let me show you the fair value calculation. looks like the footsie -- the ftse will be down. the rsa and dw are going to be weighing on those two markets. more details on both of those stories, caroline hyde is here.

caroline: as we can see, there can be significant moves after admitting it has been cheating for years. core, this is how the shares have performed for the past 12 months, a downward trajectory. volkswagen could fault and even further 10%. hit on their market capitalizations morning is likely. of course, we understand they have been turning on their pollution controls only win the cars under admissions testing. it is a big move affecting volkswagen, a big move affecting rsa here in london. it is called down to the tune of 8% this morning. rsa insurance

because of their own problems and their own general insurance unit. there could be a $200 million the chinaby explosions, the port disaster that happened august. also u.s. auto liabilities are likely to weigh on zurich insurance. the deal is off to our sacred fall, as indeed could zurich insurance. to buye semiconductors at mill. the investor base could be slightly worried. guy: thank you very much. around $71 cap billion -- 71 billion euros.

a big chunk of change of being wiped off if the invocations are correct. what is the legacy? what is the feed across asia? zeb: i wish i had better news. you see the legacy at the bottom of your screen. the federal reserve decision to hold record low rates still impacting investor sentiment. it raises new concerns about china, concerns about the growth trajectory. however, the new china-based of data came out. it says the pessimism on china's divorce from the facts. if you look at the shanghai composite, it is extending gains. the hang seng doing the exact opposite. look at the movers in hong kong today. we see oil related shares, scene cnooc. we will watch that are closely. major names moving today.

however, mobile companies have one bright spot. china mobile up 1%. and utilities in some cases. the xi chinese markets, ,inping has three united states we will what's a closely. watchonomic -- we will that closely. and economic data comes out this week. we see a selloff in jakarta. down one quarter 1%. in an interview this weekend with officials in the government of there, and in asia official saying they seek to speed infrastructure projects by easing the rules. that could create business opportunities for engineering and construction firms. in malaysia, we have the ringgit sap in the longest-running weekly losses since 1971. the kale ci today down by about

1.3%. currencies have been active. we see haven demand driving the markets. the yen has been popular. we should know japan's equity market and bought an -- and bond markets closed through one day -- and bond markets closed through wednesday for the holiday. guy: the japanese also celebrating their victory in brighton this weekend over south africa in rugby. i think that would take a few days to get over. let's get back to greece. see press winning the greek elections over the weekend. turnout was very low though. for the year p.m., we are joined by thomas visor. happy -- are you happy to see mr. tsipras back in power?

>> good morning. the polls were quite undecided going into the elections. but after what we experienced over the last one or two years, in predictive capacity, no one was really holding their breath that it would be a net to neck race. i think we will see a pretty stable government. , after the summit of the 12th and 13th of july, we believe has bought into the program and we expect a strong implementation and a fairly rapid formation of a government. guy: what is job number one on his list from an economic point of view? have a fairly, we substantial disbursement already after the 14th of august. billion of front,

23 have been dispersed. 3 billion are still outstanding listse are tied up to two of milestones which have to be implemented over the coming weeks or two months. and this is what one has to agree with him on. what are the milestones? what are the important reforms that he has to undertake in order to unlock the 3 billion which will be dispersed into branches. so that is item number one. and there are beliefs that the second set of these milestones will be tied to financial sector governance, financial sector reform. guy: can i draw some link inches -- some linkages. there is some concern beginning to creep in.

if you get slippage in other parts of the program, you may not to get the same kind of story relating to the tank recap that you would hope for. can you walk me through the linkages here and how concerned you would be if we have problems story?e bank recap if that doesn't happen, this is an economy that is never going to deliver the numbers that are built into the program. >> the banking recap should be withind by the end of or october -- excuse me, the stress test and the as a quality review should be finished in the course of the month of october. of therefore, the amount possible recap needs or for sure recap needs, would be settled upon. and one would be able to determine the sources of recapitalization.

so that is fairly clear. there is the decision of the heads of governments from mid-july which say that the disperseds should be at the end of the first review or not later than 15th of november. that theonfident groundwork for the recapitalization, between here and made or end november will be there. stories i relate to that are obviously making headlines at the moment? one is the story relating to greece and the other is the story relating to migrants. migrationnk that the story will have any meaningful impact on the way that greece has dealt with working forward from here? company -- transit transit country but bearing the

burden. i would say maybe in very meta-political terms yes. but in reality, what the implementation of the program is mainly about are the medium to long-term structural changes that should make greece a well governed and fairly strongly growing economy. the issue about external frontiers in greece is possibly more about money being sent to greece in order to strengthen border controls in order to strengthen their capacity to deal with an influx of refugees in order to fulfill the requirements that the european union has of such a frontier country.

there is also, of course, the unionwhat the european could be doing, should be doing, these of a turkey. -- vis a vie turkey. what you are asking is will greece be able to cut some slack if they wanted to because of the refugee story? the answer is a definitive no. guy: on that note, thank you very much indeed for your time. european union president for economic financial affairs committee. european futures furthering a little bit now. i want to make you aware of this. we now have the paris market looking like it is going to open in positive territory. keep in ion vw. that is the fair value

calculation you're looking at in terms of how europe trade is going to start this morning. we'll just show you this is what is happening with the german 10-year. this big move friday, now with this elevated level, not really moving very much from that. we kind of repriced and this morning it is staying there. we have chief investment offer at -- officer at teflon management. after an interesting friday sunshine, how much recalibration have we had to do post the fed meeting? we were told effectively that we don't need to just think about the u.s. economy when it comes to the fomc. we need to think about globally. >> right. anyway, they give confirmation to those people who are saying, oh dear, we have a global growth problem, not just raise right a

ride today. i think that is what is being priced into the stock market. i would expect that to continue for a little while. probably weakness today. little bit of a balance later in the week. but i am not expecting equities to go very far. until such time that we get some stronger it economic growth data. guy: volatility looks like it could be something we need to think about. in this month -- in this multipolar environment, what you've got to think about those up. and as a result of which, one of those factors is going to rise. how much more volatile do think the economic government is going to be? how much more volatile is the asset management environment on to be? >> i don't think the economic environment is as volatile as the markets suggest. expectation of markets, the fears -- there is still anxiety, but there is the

global slowdown and that makes markets more volatile. in that sense, yes, it has an impact on asset allocation. and yes, i would expect these things to move around. we have significantly reduced our equity exposure ahead of the fed announcement. termse as we expected in of the announcement, but it almost didn't matter which way it was going to go. the markets are going to be unhappy either way. only going to change that stance until we get a fit rate rise or we get more data from the global economy that confirms that it is as boring as i said. today onbig stories the stock front. vw and are say. let's take a vw. is the market, the current jittery environment, going to

punish companies disproportionately for what is happening to them? think disproportionately punished. vw is in for a pretty rough ride today on the back of that story. if you read it, it does sound quite extraordinary. guy: stay with us. plenty more to talk about. what we are looking at in terms of the get-go of european trade, this is the german 10-year yield. fairly stable versus the big move that we saw on friday. let me show you some numbers in terms of the stocks. looks like the euro stocks are in positive territory. goton and frankfurt both the w and rsa respectively to act as anchors today, maybe keep them a little more firmly on the floor. we will take a break. we'll come back in the we'll talk about this a little bit more. we will see you in a moment.

guy: alexis tsipras back in power. he will enter another coalition with the same small party that helped him rule before. zurich insurance group has a banded rsa. zurich has announced it is expecting a loss in its own general insurance business in the third order. the proposed takeover was valued at 5.6 billion pounds. and volkswagen has called for an external investigation. personallys he is sorry to break this to its customers. possible climate are -- possible collateral damage. china todayne in

looking to boost economic and cultural ties with britain. he says he wants a golden decade within the two nations. david tweed is standing by for more. so what is the main message? he wants a golden decade. what does that ask the mean. david: there's also another phrase that has come out of this article that was in the observer guide by him and jim o'neill. best partner in the west, that is the other slogan coming out. it really is a story about how osborne and the united kingdom has recognized that china will remain one of the strongest growth drivers in the world and the u.k. wants to integrate into that. it is really extraordinary when you look at the day -- the delegation that has been taken by osborne run across china. we're not just hanging in beijing and shanghai. we are going right into the big cities that maybe people in europe have not heard of. but these are the cities that will be driving chinese growth

and continued to drive chinese growth. it is interesting to look at the sort of people that are in the delegation. the leaders of places like liverpool and sheffield and inchester, they are involved the delegation. osbourne wants to see these northern parts of the united kingdom integrating into other parts of china. also interesting, i thought, was to see the cultural institutions, which are being represented as well. without the national theatre. we have a head of the british museum that is going to be there as well. and they are crisscrossing all of china. that is why this is a particularly interesting visit. and it comes ahead of xi united's visit to the kingdom next week. guy: the golden kingdom kicks off here. they are going nuclear as well. david: i thought that was an interesting story out of the united kingdom, given the fact that osborne is in china, the fact that they will be backing a

guarantee for the heatley nuclear reactor, which is going to be built in the united kingdom. because the chinese are also part of the partners in this. and also i saw an interview with sheenergy secretary saying can also see the possibility of a chinese designed nuclear power plant being built in essex. the message here is that it is a two-way street. the u.k. wants to go into china, but they also want to welcome chinese investment, even in a history like nuclear power, in the u.k. guy: thank you. story, xihina jinping's visit in the next two days, it will take a lot attention over the next couple of sessions. book --he chinese rage big book. as bleak as some of the

other numbers tell us. >> i thought that was interesting. our perception of the chinese economy has been a little overwhelmed by what is going on in the chinese stock markets. action, those two ari levy bit separate. buthe economy is slowing, it is not slowing as much as as some makers believe. china is still growing. it is still growing healthily. and they may have actually overcome some of the difficulties that they recently had. and there is some growth ahead. guy: do so nice to see you. jon ferro is with us. john, vw, rsa, it will be interesting for those two stocks. : yes. fall as much could as 10%. it will be a stock that we keep in ion at the open.

broken promises, a financial system nearing break down still teresa regained power. the new greek government looks a lot like the old greek government. maybe we should just be: him teflon suppressed. -- recalling him teflon tsipras. right. so lee w, two stocks very much to watch at the get-go this morning. jon ferro will be walking us through all of that. this is the story going into the open. to buy 4/10 of 1%. but it will suffer on the back of that vw story.

jon: good morning and welcome to "on the move." we are moments away from the start of european trading. and the neares breakdown of the greek financial system. alexis tsipras still manages to win his second election in 18 months. the german carmaker could face billions in fines. officerch abandons an -- an offer for rsa. ahead of the open, where are we? 20 seconds away. ftse futures lower by 28 points,

what is the story and mainland europe? it is all about the equity movers. caroline: could it be a third day of losses, indeed. the federal reserve held steady in terms of the rate decision and the markets became worried about global growth. global growth is once again front and center. pretty much flat but we will keep a close eye on the dax. major equity on that particular stock index. things are basically flat this morning at the moment and there is a little bit of caution for the moment. there is a little bit of recalibration as to what we are likely to see going forward and whether we will see the ecb stimulate more. keep an eye on the euro currently flat against the euro. goldman