welcome to to today's "worldwide exchange," i'm ross westgate. >> and i'm kelly evans. >> european stocks follow lows. avoiding risk out a summit of eu leaders where they will discuss plans for a banking union. >> madrid is expected to formally request aid to recapitalize its lenders today. the yield on the benchmark debt ticks higher in early trade. and qatar looks to ramp up investments seeking a $5 billion quota just as beijing gets set to ease entry rules for foreign investors. the u.s. supreme court may rule on whether president obama's health care law is unconstitutional.

so a warm welcome to this side of the trading week on "worldwide exchange." we're one hour to the trading day for europe and after being up last week but down for the last two sessions we're now down for a third session. weighted to the down side. decliners outpacing advancers by more than 9-1 with the dow jones stock 600. so european stocks, the ftse 100 up, currently down last week. it was up last week. xetra dax down 1.5%. it was up half a percent last week. the ibex down sharply off a 2%. wait to hear whether we get a formal request for bank aid during the course of the program or during the course of the day as many expect. as far as bond markets are concerned, we see yields edge higher in spain getting back towards the 6.5% but still down

from the 7% we were two weeks ago, also high yields this morning but below 6%. ten-year bund levels 1.52%. we hit 1.14% yield on german bunds. as far as the currency market, the dollar had a good week. the index up about 1%. this morning it is firmer again. euro/dollar below 1.25. dollar/yen down to 80. aussie dollar down to 1.0005 level. commodities weak across the board. and sterling/dollar lower 1.5551. we did get a bounce this morning for oil. brent just above 90. we did get up to 91. we have tropical storm debby blowing through. there may be a temporary shut down and a norwegian strike. ibex at 79.28. spot gold at the moment at 1569,

weak weaker. copper trying to bounce off six-month lows. you can see at the moment the number is 330 for the comex number. what about what's happening in asia? tracey has more for us out of singapore. hi, tracey. good morning to you, ross. asian bourses are mostly in the red as they have uncertainty over the outcome of this thursday's eu summit. chinese stocks saw a weak start after the long holiday weekend. the composite slipped about 1.6% hitting its lowest level in month. property plays were the biggest losers. markets will be waiting on china's official data expected to be out this sunday on the economy. hong kong shares failed to stay in the green as well finishing about half a percent lower. tokyo did most of the weakness centered on europe's exposed stock. the threat of policy paralysis over plans to raise the country's sales tax weighed on

sentime sentiment. the kospi moved down with bell with weather electronics tracking the broader index throughout the session and, of course, our reporter rhie-young lim will be live from seoul. half a percent closing a three-week low. india sensex is the clear outperformer today trading up about 0.4% on expectation the government is set to announce key measures to boost the economy and control the sliding ru rupee. we will have more coming up in roughly ten minutes. back to you, ross. tracey, thank you very much indeed for that. tennis starts today. >> i appreciate that. >> i've moved on from the soccer. >> you only moved on because england lost. >> it doesn't matter. the first day of wimbledon. you may be right, of course, about that. >> do you think a likelihood a british player, in andy murray, does better for britain than maybe we saw last night? >> quarterfinals would be --

andy will get to the quarterfinals. i expect him to get to the semis. >> pressure is on, andy. and on today's show pressure is on as well. qatar wants to invest $5 billion in china, most in equities. live in hong kong to discuss the long-term potential of the chinese market. we go live to the middle east as egypt's president elect calls for national unity after his victory in the country's election cans. but can the muslim brotherhood represent all egyptians? and we'll hone in on japan for this week's edition of trade licks. what the sea of japan's biggest online shopping lane, what putin has to say about the expansion plans and investment in pinterest. and the supreme court is set to vote on obama care this week. we'll ask if the bill should be passed. that's at 5:30 a.m. eastern. first, spain is expected to make a formal request for $100 billion euros of aid to recapitalize its banks. they suggest the foreign mince it terse will formally discuss conditions of the loan at a

meeting on monday, july the 9th. stefan is in madrid for us this weak and joins us now. how do we think it might work in terms of the conditions and how we set up keeping distant from the spanish government? >> reporter: after two weeks of speculation, ross, we might have a bit of disappointment. the government is not expected to ask any presized amount. it's up to 100 billion euros. last week the government said that up to 62 billion would be necessary for the spanish banking sector to cope with the most adverse economics. but it's not the final number yet, the final version of the stress test will be release d a the end of july. so in the meantime the government will ask for a bailout, a formal request. but without. we don't know what would be the conditions, the euro group members will meet on the 9th of july to discuss the conditions of the loan. the eurozone members are likely

to ask for deep restructuring of the spanish banking sector with the creation of the bad bank for all the most problematic assets mainly from the property sector, and according to the banks would be the most expensive part of the plan estimated at $15.6 billion euros. we don't know, also, the mechanism for this loan. will the money be injected straight into the banking sector or will it go through the spanish government? the government here in madrid doesn't want to receive the money directly because, of course, it would increase the debt burden so that also needs to be discussed. and last but not least the creditor status of the esm also needs to be clarified. if it gets senior credit then it would have priority over regular bondholders and that could create some new tensions on the bond market for spain. so plenty of questions and i'm afraid we won't get all the answers in the next couple of days. >> that would be hoping for too

much. stephane, thank you. with us regional economist at cimb there in singapore. nice to see you. ollie, let's kick off with you, first of all. up to 100 billion is what they might be looking for. we had the reports that suggest it's 62 billion. is that going to be enough? the parameters they put on that didn't seem bleak enough. >> fair muff. that's exactly what it is, isn't it? everyone is looking for the right number. in a way this is a pr exercise. if it was less than 100 billion, it would have been announced a couple weeks back. i think there would have been a problem. i don't think anyone would be worried if spain asked for too much assistance. the oliver wyman report suggests they're up to, i think, 274 billion extra losses over the next three years.

however, with mitigants is such as deleveraging of the banking system and other measures would mean that the 274 billion number is only a capital increase, so it sort of is looking at an optimistic scenario in terms of making money. >> and it's a good point because people focus on the headline number, that 62 billion number or whatever. as you point out, that's if if they allow their core capital ratio to fall, that's the minimum level that could be needed. the report did find that the needs are actually far greater, the potential losses are far greater. so if you want them to write down the value of those loans while maintaining capital at 9% and not falling to 6%, that would actually imply that they're facing a much higher degree of losses. >> and, again, instead of focusing on a particular number which the european banking authority requires banks to hold a quarter, a capital of 9%, but

under this adverse scenario, it allows banks to reduce their quarter ratio to 6% which is an additional 55% -- >> exactly, ross, what you think you'd want to see banks doing right now. >> let's bring the euro in here. this is just the latest stage on the every day story of the eurozone financial crisis for the summit later this week. what's your own thoughts about where we're at? >> well, i think importantly taking lessons from what we saw here in asia, the asian financial crisis, and particularly housing crisis. i think it's very important we have some signs of a hint of a bank asset management company that takes off all the bad loans from the spanish bank. i think they should have done so much earlier on. if they had been able to put some number on and essentially perhaps get the stronger banks to fund it as well, get the ball rolling, take the bonds, the

loans, and then perhaps the first step -- together all that stuff that's going on, the steps at least of getting the banks to a healthier balance sheet will have started. so i think a lot has to be done very quickly and there's a lot to be done. >> can we do enough quickly, olly? >> fundamentally, no. but it's a pr exer sisz. it buys time for spain. it gives them some breathing space. unfortunately politicians move at a different speed than the markets do as you can tell over the last few weeks and that speed is more urgent. we believe that this crisis has to get worse before it can get better because it's only the last minute that politicians will act and, you know, provide a meaningful solution to this crisis. >> the worse it gets, the more they can do. i wonder, too, what they're trying to do is to cleve spain's banking system off the sovereign, whether they're going to be able to do that. is that what we should look for

this week is an effort to do that and, if so, does the sovereign end up worsening even if the banks help out? >> absolutely the nexus is only strengthen strengthened with the ltros and, indeed, with this bailout because the $100 billion will be on the balance sheet of spain itself which only 0 seems to reinforce that. it doesn't cleve it, as you say. perhaps some news on alleviation there. certainly an announcement of the bad bank which the imf has been calling for would be credible. it wasn't credible before when there wasn't a capitalization. when you move over the assets, that creates the hole that needs to be refilled if you like with capital. so that could certainly help and sort of driving things forward. as you say, the spanish government is very keen on putting clear water between it and its banking system. >> olly, thank you very much. senior bank analyst sticks around. the other stories we're following today, eu leaders will discuss the details of the four pillars they believe are necessary to secure the future

of the eurozone when they convene on thursday and friday of this week. according to a document seen by reuters, talks around the creation of a banking union. more integrated budget policy and plans for deep economic ties between member states. they will also discuss how countries can keep their legitimacy in an attempt to offset the loss of sovereign autonomy. at the same time the bank of international sentiments insists the onus is on governments and not central banks to resolve the crisis. in its annual report they say loose monetary policy is not a long-term solution and that the financial institutions must become european banks in order to stop national problems spreading across borders. and the new greek prime minister antonis samaras won't be able to plead his country's case for looser bailout terms at the eu summit or at least not in person. he's still recovering from eye surgery and won't be traveling to brussels. the country's new finance mince it ter vassilis rapanos is in

the hospital, also. as a result representatives of the eu, the ecb and imf have postponed today's scheduled visit to athens to discuss the progress of reforms as part of the existing bailout terms. the u.s. supreme court, meanwhile, could rule on whether president obama's health care law is unconstitutional. do you agree or disagree with obama care? what bits should be kept? what should be chucked. join the conversation on "worldwide exchange." get in touch with us by e-mail or reach us directly at kelly evans or at ross westgate. >> don't miss out. still it to come, the indian finance minister is addressing the nation and confirms the rbi will take steps to boost the economy today. we'll be in new delhi after this.

welcome back. egypt's new president, mohamed morsi will begin to build a new administration in the north african kcountry. yousef has more on the story and joins us from dubai. yousef? >> reporter: kelly, a historic

moment for egypt, the first civ civilian egyptian president in the country's modern history edging out his opponent by 3.5 percentage points in a keenly watched announcement yesterday, the anticipation had been growing to the extent there were fears of anxiety. and you could see in tahrir square how people reacted with a sense of relief and really showed their celebratory mood, if you will, again this has been a very difficult transition the last 530 days since hosni mubarak was ousted from power. the question remains, kelly, what can morsi do now. he is an engineer who was educated in the united states. he has little background when it comes to egypt politics. he was an activist and jailed under mubarak. how much power will the military allocate to him? remember, this is a country where a constitution has yet to be written. parliament is effectively

dissolved and presidential powers remain ambiguous. this is arguably not the kind of swift clarity that investors and observers were hoping for the. the analysts have made it clear thats had the beginning of a prolonged battle between the muslim brotherhood and the military council which has been overseeing this transition. we'll see later on today how the equity markets react to the news domestically and on the etfs abroad that track the index here. of course the international reaction to the elections have been mixed. the united states and israel have said they respected the outcome and hope that they will ensure peace going forward and stability in the country. while in the gulf we've seen a more muted reaction. of course historically the muslim brotherhood and the gulf oil producers have had a vexed relationship. an interesting development and of very much significance when it comes to geo politics in this part of the world, kelly. >> all right, yousef, thanks. qatar is hoping china will boost its foreign investment cap

from the $1 billion currently. they plan to allocate the funds mostly in china's he cequity mas and ipos. last week china said it's looking to ease entry rules for approved foreign investors. this is part of beijing's plan to stimulate its economy. meantime chinese investments in the u.s. are likely to double soon thanks to lower costs and more local incentives. the remark came from a department official during a conference over the weekend. the china daily says beijing and washington signed investment contracts worth nearly $3.5 billion for a total of 42 projects and almost two dozen seco sectors. let's get more from cimb. are these moves by china to open up its domestic markets a sign of desperation? >> doing so gradually what we have seen is they have taken

steps to liberalize its banking system, doing so with capital markets. i think this is the last term or last month of the old leadership. open it up just to ensure the flows continue. if they had been more desperate they certainly would have done more on the fiscal size as well. this is more in terms of just the massive demand out there from other investors. >> spain has formally requested european aid for its banks, and it has not asked for any specific number. this is according to an economics minister spokesperson. they have requested european aid

for the banks but there is no particular number they have put in up to $100 billion is what they said. why would you have to put up a number at this stage? banks will tell you what the number is. >> as soon as you give a number you know markets are immediately going to jump ahead of it or see through it. >> what you are saying, how much do you want? >> blank check. >> don't know. >> as much as you'll give us. >> the finance minister for spain speaking at the top of the hour may provide more detail. may not but may. we'll follow the story for you. let's get back to what you were saying about china because we follow the stories, as you know. look, as far as the chinese growth story, not only are we worried about the eurozone as well, we saw hsbc slash pmi. they dip down again. what are the official numbers going to tell us and what's your view what happens?

>> probably still soft. the unfortunate thing is the softness in a u.s. economy, are the worries of the european banking crisis is the pmi numbers for the second quarter would be softer. the second quarter tends to be quite a month for chinese manufacturers after relatively easy first quarter itself. but, however, this year because of the weakness being more weaker, a number is coming in very soft. so, hence, we don't see that weakening trend. i think even the chinese would be weak er every june or july they fall. how much are they going to fall by this time around? more than the seasonal weakness? we think it may dip below 50 this time around which would be, i think, the second time since

november last year. the question is how far below 50 we're going to get at this juncture. >> all right. let's bring in the managing director and chairman of global markets china at jpmorgan. nice to see you. what's your own reaction? where might the chinese government direct investment as they cope with this slowdown? >> well, we are clearly seeing the chinese economy on a moderating trend in the last six months so we're seeing the central government beginning to take action. first of all, the fiscal policy front, they are proving more projects now within a pram work of the five-year plan. we're beginning to see more infrastructure programs being restarted. some local governments have been cash strapped so, therefore, local infrastructure projects were basically shelved. now we're seeing the central government helping local projects. number two, we're seeing

monetary policy becoming more accommodating. we had a rate cut in recent weeks. we're projecting another rate cut some time in the third quarter. in addition, the central government is beginning to support liquidity so we're projecting another cut in the reserve requirement ratio in the coming few months and, finally, growth is quite important. as you know in china the avail ability of credit is more important than the cost of the credit, i.e., interest rates. growth is beginning to pick up. we saw that in may. hopefully in the month of june we will see an increasing trend for long growth as well. >> there's been some discussion that actual ly it's not even th price or the availability of credit but the demand in china that is lacking right now. that's typically seen as an industrialized world problem. do you see evidence of that, that there's actually, you know, that on the demand side perhaps we've seen a real weakening? >> that is a very good question.

we are indeed seeing the demand for loans softening in recent months especially the heavy industrial companies as well as the property sector. many of these companies don't have a very rosy outlook in the future months so they're reluctant to take on extra debt. so in the recent months we're seeing quite an interesting phenom none. banks have loans to given. they have the actual woe at that but the demand from the sector and the property vemers has been relatively weak. that is remrekting a nflecting companies. >> when we figure out where china is heading. jing ulrich, thank you for joining us. india's finance minister has announced he is to step down tomorrow. speaking to reporters he c confirmed that india's central bank would take steps later today to boost the economy. so let's get over to new delhi. more details for us.

what are the implications here? >> reporter: well, what we did hear over the weekend is that both -- there is going to be a coordinated attempt by the finance ministry and the central bank to try to prop up the economy. what we do understand are the steps are going to have more to do with the rupee. ththe indian rupee depleted almt 28%. the central bank is worried about the volatility so perhaps the steps that will be announced later today, 5:00 p.m. india time is when we are expecting those announcements, will pertain to the government and corporate bonds, reducing the locking period for investing in corporate and government bonds. this is speculation. a bond issuance basically means they can bring dollars into the country. that is what the reserve bank, we understand, is working on at this point in time. to touch upon the other bit of information, the finance minister is going to be stepping

down tomorrow. he resigns because he will be in the post. he is a presidential nominee. he resigns from the congress. now officially will kick start his campaign for the president's post on the 28th. the speculation is that the prime minister of india is actually going to retain the finance portfolio. remember, he was the man who steered the indian economy through perhaps one of its toughest periods in 1991 and is expected to take over the finance portfolio. the market is looking at this development optimistically there is a hope that once the prime minister actually takes charge there will be some sort of movement as far as the reform agenda is concerned. expectations are building up as to what they will do. >> thanks for that. and up next, toyota is reportedly planning to supply its hybrid technology to a rival

automak automaker. we'll have all of the details live from tokyo next.

hello, this is wo"worldwide exchange." here are the headlines. madrid requesting aid to recapitalize its banks.

no amount has been specified. the debt ticks higher. european markets follow asia lower. investors avoid risk ahead of a summit of eu leaders where they are expected to have a banking union. qatar is speaking a $5.5 billion quota. this as beijing eases entry rules. the u.s. supreme court may rule on whether president obama's health care law is unconstitutional. so if you just tuned in, it's the start of a fresh trading -- just pushing things off my desk. good to be back. >> still jet lagged. you can still blame that. >> you're peep stocks this morning down for the third session in a row. we're up on the xetra dax, the ibex was down a short while ago. it's off that low.

as far as currency markets are concerned, dollar index up 1% last week boosted by the fed comments and it is a little bit firmer today. euro/dollar just dipping down to around that 1.25 mark. euro/sterling is down. the aussie is down against the u.s. dollar as well. >> we're seeing, meanwhile, bond yields tick up a little bit in spain and italy. still lower than the highs we reached a couple of weeks ago. spain there 6.49% now. it's continued to move higher this morning. italy 5.84% on the ten year. meanwhile, bund from the bid. we have germany down 1.53 percent. ross, one bright spot in the markets this morning, egypt's egx 30 up almost 3% after morsi's victory yesterday. >> there's still a long way to go as yousef was saying in egypt. but in the last 15 minutes spain

has formally requested aid to recapitalize its troubled banks. they have not been asked to raise a specific amount. the finance ministers will discuss the conditions of any loan at a meeting on monday, july the 9th. cnbc asia is looking at how they protect their portfolio playing defense. the focus today is on sovereign debt. joining us is the head of the company. still with us is seng wun. i heard on page nine, if you want to read it, if we get any big bazookas, is it hard to see investors not still sitting on the sidelines and using bunds, gilts and resries? >> it's quite messy at the moment. there's clearly a distortion that all the liquidity has been

injected and i guess that has confused investors in terms of what the real prices of any risk asset is in the market. that said, we've made some political strides. there's been a general exception in spain there is a problem. we are a long way away from evil hedge funds, you know, distorting the markets. so there is at least an acceptance from the european leaders, there is a fundamental issue within the eu and the sovereign. >> i guess the first step is admitting you have a problem. we showed spanish ten year at about 6.5%, would you buy it at these levels? >> again, i think a lot of these prices are a function of the liqu liquidity that's been injected and a lot of the sort of collateral easing rules that have been implemented or at least suggested over the weekend. so i wouldn't say these are real prices of which spanish yields would trade if you let them flow. i guess the short answer would be probably not. >> what would it take in terms

of investing to sort of make these yields more attractive, how much visibility do we need to see in eu fiscal plans? what's the time frame? is there anything that can be done in the couple of weeks' time to make all of these assets more attractive? >> i think it's too short. we are in this for the very long haul. there's a lot of pain within the system. i guess simply speaking we have just borrowed much more than we can afford to pay back and we have collateralized it with assets that are probably way above what they are worth in the market today. until that is cleaned up, and that will never be a political decision because politicians will never inflict the kind of pain that is necessary for the markets to correct. >> what is the easiest way to clear it up? what's the least politically painful way to clear it up? is. >> i guess in a way similar to what the u.s. did after the '08 crisis which is to set up -- basically take banks -- take

them over, take their assets, put them into vehicles and sell tem down because even if you provide inventives for the market to buy these assets, it still helps you clear up your balance sheet and just helps you look at life more clearly. >> it doesn't help at the same time that we're talking can confidence. it closely is off the macro conditions. even if you try to fix the problem you have now, the fact there's no growth and high debt levels in spain and high unemployment means you're still going to have a problem tomorrow. the push for this growth pact to come out of a series of meetings this week, what -- but you can't create growth out of thin air. >> right. i guess we've kind of lost our opportunity over the last two years. if if you recall, the first qe rose up, allowed asset prices to rise dramatically over the last two or three years and many banks could have used those opportunities to sell in the market, but they didn't. the and as a result of which, we find of find ourselves with the

same assets sitting on our books but probably not at the levels we market. >> zombie bank is the term you're hearing more and more. >> absolutely. so let's just bring you in here. because of this crisis, a lot of investors are willing 0 to engage. it's keeping those core bond yields low. could they actually go lower? >> well, what we have seen really is just moving around the peripherals. for us in asia is really where do we see the sign to actually get down to helping the economy to actually create jobs. what we've seen are helps tidy up a little bit but not anything that goes down to the crux of the matter where it is greece creating jobs, spain creating jobs. still far from it. that kind of environment, we'll still see people take opportunities to trade rather

than doing anything more meaningful because they know that, "a," they are waiting for greece to be kicked up. "b," contagion effect of that and then we'll basically see because at this moment it's just like somebody sneezing who catches the flu. >> it's also interesting because a lot of kind of interesting points in there, but one of them is we're not seeing rebalancing. everyone is trying to do export leg growth including places like germany that should have been doing more domestic consumption. longer term problem but are we still creating further imbalance for tomorrow instead of fix iin the ones that existed? >> you have to be able to make things that people want to buy. germany clearly does. it produces lots of things that people want to buy. so unless and until the peripherals start producing the rest of europe really wants to buy willingly, this is going to be difficult. although you can make it easier.

i guess there's been some kind of agreement over the weekend to rebalance slightly that will help but it's not going to solve the problem tomorrow. >> but you need a buyer and that's the point, which is it's great to make things people want but germany or whomever needs to be spending the opec exporting nations need to be spending more and sort of exercising their demand. hsbc needs to be buying things and not just treasury securities. >> right. it's hard to just turn it around and start buying things simply because you want to help your neighbor. it may be the right thing to do but it's a very difficult thing to implement as a policy. so it will be interesting to see how this plays out. it may take a while. >> yeah, that's for sure. >> thanks for that. more on the top stories today. the u.s. supreme court could rule on whether or not president obama's health care is constitutional. they are usually announced around 10:00 a.m.

they think it could be today or thursday. the question is whether congress exceeded its authority requiring all americans to buy health insurance. it could strike down the entire me measure, keep all of it or part of it. the best performing sector up . 0.8%. jpmorgan meanwhile reportedly plans to improve risk management at its chief investment office which racked up more than $2 billion in trading losses. but "the wall street journal" says while the unit will avoid large bets on derivatives, it's sticking with a strategy to dive into other risky investments like corporate debt. those items have generated more gains than losses over the cio office's history. jpmorgan will provide more details when it reports earnings in just a couple weeks' time, july 13th. earnings season is coming up. >> is that a friday? in corporate news, reportedly in talks to buy the rest it doesn't own in a deal that could be worth more than $10 million.

mexico's biggest owner. a deal could be announce this had week. inbev holds 44% of modelo's voting shares. we'll take a look at stock. we'll just keep it on those pictures of bottles going round and round. >> fine with me. >> ab inbev up today in belgium. bp's stake according to "the s sunday times. "the newspaper cites three sources which suggest an arm of the russian entity giant has made the offer. bp has declined, though, to comment on the report. and speaking of oil, the gulf coast is dealing with its first major storm of the season. this is tropical storm debby. it's situated around 90 miles off the florida panhandle with maximum sustained winds of 60 miles an hour. the storm which appears to be in a holding pattern has pounded parts of central and south florida with several inches of rain and that's caused heavy

flooding. debby is not expected to track to the oil and natural gas regions of the gulf although 23% reduction has been shut as a precaution. up over 91 but it's back to $ . $90.50. >> still a bit of a downer. over in japan news toyota and bmw may be working together more close hadly. the story live from it tokyo. >> reporter: hi, kelly. t toyota motor plans to sell hybrid technology to bmw, the first time it will provide its fuel cell technology to a rival company. it uses hydrogen to power vehicles. the latest technology transfer will deepen the partnership between the two companies that began last december on diesel engines and electric car batteries. the president and bmc ceo is

expected to unveil their new plan this week. the announcement will come at a time when bmw's hybrid technology partnership has been thrown into doubt by the prospect of deepening ties between psa and opel. nissan says its chinese joint venture will build a new car factory in northeastern china. $800 million factory will have an official capacity of 150,000 nissan branded vehicles a year by 2014. back over to you. >> thank you. over in korea, meanwhile, shares of samsung electronics hit a 4 1/2 month low. they cut earnings forecast in the company for the second quarter. rhie-young lim has more from seoul. rhie? >> reporter: that's right, kelly. about $6.4 billion was knocked off samsung electronics and as a national bellwether waiting on the main index.

helped drag the kospi 1.2% lower at the close. and as you said, local brokerages cut their forecast deciding weak global demand not to mention slower than expected rebound in prices. the delay sales in some markets also gave securities firms a reason to lower their outlook. samsung electronics is very bullish about its sales for the smartphone. it hits the local markets today. the president of the mobile business, in fact, will easily be a 10 million unit seller in july making it south korea's fastest selling smartphone. so far it's been a major hit in europe. a share of key mark like italy, france and germany has already topped 50% in both the smartphone and hand set segments. while revenue is looking strong, investors are worried. back over to you.

>> thank you, rhie. asian hand set makers are also dealing with another challenge. analysts say unprecedented growth in many asian cities is creating big strains on infrastructu infrastructure. that's just one of the long list as urbanization speeds up. cnbc has more in this report. >> reporter: 65 million and counting. that's how fast the world's urban population is growing annually. and that number is about to get bigger. the united nations estimates that will increase 72% by the year 2050. the world's urban population will be 6.3 billion, roughly the same size as the world's total population a decade ago. >> what are the challenges dealing with these issues as an organization, the first one is how do we control it?

if we don't control it what will happen we generate slums, we gener generate pollution. we'll have a lack of infrastructure. the roads will get clogged. we generate a whole bunch of problems. >> reporter: as for the region's two superpowers, their approaches couldn't be more contrasting. >> the big difference in terms of the approach is that china has a very clear political system for managing their cities. the challenge in india is that there is no political matching of the political system in the cities. >> there is some progress, the pace of this needs to be lifted very substantially because it's falling behind in areas such as power generation, simply not of a sufficient standard to meet the needs of industry, and it's way behind china at the moment in terms of achieving those

objectives. >> reporter: as asia prepares for its urban billion, it isn't without challenges and the pinch will be most evident on the jobs front. >> in particular the need to deliver jobs growth will be very important, so governments will have to develop strategies to create in particular manufacturing jobs and also service sector jobs to cope with this rapidly growing population in the cities. >> reporter: governments can't create enough jobs or the infrastructure to feed the growing city population, there will be a big risk of social and political tension similar to what many middle eastern nations experience.

joo japan's largest retail marketer with $100 million investment in pinterest and the takeover of spain's tv, the country's version of netflix. what has been driving the expansion and what challenges is the company facing? i spoke to the founder and ceo and asked him about the company's growth in europe. >> we are not just primarily focusing on the big countries but we are also trying to go

into the spain, italy, or other countries less xcompetitive at the moment. >> is e-commerce, which is what your company is mostly all about, similar to an amazon.com. a lot of e-commerce marketplaces. but is your company -- is e-commerce a bright spot amid what is a weak global demand situation right now he especial in europe? >> well, the e-commerce has sort of an immunity against the economic situation even if the economy is slow. i think e-commerce will still perform very, very well because people are looking for deals and trying to find something special. so the e-commerce still did very, very well. i think it's going to be the situation in europe as well. >> are you going to keep expanding, and as you look to other markets, what challenges

do you face? >> we are going to keep expanding geographically. one of the largest companies which is based in canada. and i think we are going to have many more countries and we expand the scope of our service. >> and what -- when you're looking at those countries, are you finding discounts on assets or on strong businesses in some cases like europe, do you face any trouble getting financing at present for these kinds of moves? >> we have a very strong cash flow and very healthy balance sheet. we have a big business in japan but we also have internet bank so we are financing our financial business activities. >> is that necessary at present to sell finance? >> well, you know, it's much

cheaper. and we do not have the risk of the financing. if you're financing everything from the bank loan it's kind of dangerous, the relationship with the bank can go anywhere but it's cheaper and more stable. and we combine personal finance and internet retailing. >> and you also bought a stake in pinterest. why pinterest and not, for example, facebook? >> pinterest is about interest and facebook is about connecting friends. and we are a shopping site and pinterest has good strategic with our service. we like pinterest. facebook is a great service, but for us, since we are a shopping site, it is the greatest match. >> and what are your plans for the site? for pinterest?

>> we are investors. basically we have more strategic alliance. and have a more interesting shopping experience. i would like to create more enjoyable shopping experience. >> all right. and a reminder about our series on "worldwide exchange," every week we look at how the financial crisis is affecting global trade and how you do business around the world. tune in just before 11:00 central and for more go to tradelinks.cnbc.com. and a final thought from our guest host this hour, song seng

wun, when you seem to be o optimistic on the second half rebound is that predicated on more stimulus or overcorrected in terms of weak sentiment in the near term. we have the global pmi. we have banking coming through as well. so far what we have seen is despite the problems from u.s. growth, the demand within asia has proven to be resilient. it can only continue to do so if the numbers are from u.s. and europe. so at this juncture while keeping our fingers crossed, we'll see what the spanish

governme government, they can execute it, we stick with our scenario that we'll see the rebound that confidence comes back. if not we're back to square one again. >> thanks. good to see you today. we'll head out to madrid where the spanish government has made a request can for aid. all the details on that next. [ male announcer ] this is corporate caterers, miami, florida. in here, great food demands a great presentation. so at&t showed corporate caterers how to better collaborate by using a mobile solution, in a whole new way. using real-time photo sharing abilities, they can create and maintain high standards, from kitchen to table. this technology allows us to collaborate with our drivers to make a better experience for our customers.

[ male announcer ] it's a network of possibilities -- helping you do what you do... even better. ♪

welcome back welcome back to "worldwide exchange." i'm kelly evans. >> and i'm ross westgate. aid to recapitalize banks but nothing specified. the benchmark debt ticks higher. >> european markets following asia lower. investors are avoiding risk ahead a summit of eu leaders. >> plus, qatar looks to ramp up investments seeking a $5 billion quota. this eases entry rules for for investors.

welcome back to the program. we'll get you a full check on markets in just a moment. first, i want to bring you this news out of india. the central bank there is increasing the investment limit on government bonds by $5 billion, up to $20 billion. and a slew of other measures aimed at liberal zigs are being announced as well. you can see weakening a little bit. we have other headlines coming out as well that sovereign wealth funds, infrastructure firms will be allowed to raise funds or loans in foreign currenci currencies.

relaxing rules in infrastructure and on noninfrastructure. we'll have more on these stories later on in the show. ross? >> kelly, thanks for that. if you just joined us, here is where we stand for the start of the u.s. trade this week. the nasdaq down around seven points as well. the dow is lower by some 70 points or so. this follows a third day of declines for european stocks. the ftse 100 off a half a percent. the cac down 1.3. down near the session lows at the moment. we have, of course, seen spain rally to the end of last week. yields are higher.

remember, we were over 7%. ten-year gilt, the yield on that. the dollar had a good week once we heard from the fed last week. sterling dollar is lower. us aussie dollar is lower at 1.00. dollar/yen trading around this 1.25 mark. higher than the 1.22 we had at the beginning of june. commodities today, we did see brent currently down. we saw tropical storm debby moving through the gulf. the norwegian gulf as well. copper as well this morning had bounced off six-month lows we hit on friday. just slightly lower from that position on the comex price.

tracey has more. investors and anxieties over the outcome of the eu summit. a weak start after that long holiday weekend. the composite slipped 6% hitting its lowest level. the biggest losers, markets will be waiting on china's official june pmi data expected to be out this sunday for fresh clues on the economy. and hong kong shares failed to stay in the green either finishing about half a percent lower and tokyo dipped lower, weakness centered on europe expo exposed stocks. the kospi moved down by 1.2%

with bellwether electronics traging the broader index. australia up by half a percent as well closing at a three-week low. india sensex is the clear outperformer trading up actually just about stepping down tomorrow paving the run as president of the country. as kelly mentioned earlier, the rbi has interviewed a series of steps to stem the weak rupee slide. back to you, ross. tracey, thanks for that. the government has announced a specific amount of funds in the request, though. it's july the 9th. stephane pedrazza has more. no word on the amount. that would seem to be a critical missing factor. >> reporter: absolutely. we knew this would not be a

specific amount. the president of the group says that the amount would be set at the latest stage but should be enough to cover the bank's capital needs 62 billion euros would be necessary to cope with the most adverse economics in the eu. we have to wait that would come at the end of july they want to understand financing by july the 9th to discuss at the next euro group meeting. members are likely to ask, of course, for deep restructuring of banking sector including the creation of the bank.

according to the spanish newspapers it would be the most expensive part of the plan estimated. another question to be clarified, the reason for this financial support in this letter sent to the group, it will direct the money to the banks which means they should be responsible for the loan. >> chris, thanks so much indeed for joining us. this is part and parcel of the guarantees. at the end of the day you could

just stuff your banks and then say, by the way, can i have the bailout from my banks. i think this whole last two years you lose piece by piece a bit of your sovereignty and we'll walk closer. >> i think that's why you haven't seen more reaction. the only way to move forward with any degree of certainty about any of these movements is behind all of the smoke and mirrors they are coming together and if that's not happening it doesn't matter what they are talking about. >> exactly.

so the crisis goes one of two ways. there's nothing in between that. it's this balance between the french giving up sovereignty or not. i think the euro slides this year. i wouldn't be surprised if we saw it is your voif for a very long time. we increasingly affects the amount of capital the banks will require. it is going to need a bailout imminently. how unclear the politics are.

well worth the read. investors seem to need to have big bazookas before the risk pays off. >> don't pile in two feet. the issue was we needed some sort of bazooka. it's the same playbook we've seen every year. policymakers wake up, they rally, they sell off again and policymakers panic and come out with the bazooka. that would be my expectation. there's every chance this looks through the rally.

let's take a look at other top stories. bid of $25 billion for bp stake according to "the sunday times. ". >> which is effectively the russian government. they are set to vote down changes in public pensions that will affect how funds disclose their assets and liabilities. there are worries about the obligations of stock in california declaring bankruptcy today. winning 4-2 on penalties during a might of high drama and tension in kiev. >> who cares, that was so last week. wimbledon starts today. that's the key.

"brave" debuted at the top of the box office with takeings of over $66 million. i need to know the ages on that one. >> it was their best take for a female lead role and it will spur a lot of people going over to scotland to participate in the disney fantasy. and whether president obama's health care law is unconstitutional. rulings will be afounnounced ard 10:00 a.m. eastern. the law caused all americans to buy health insurance. they could strike down part of it or keep it intact. we'll talk to the ceo of athena

health. >> first a look at what's on the agenda in the u.s. this week. may new home sales are out at 10:00 a.m. eastern. tomorrow investors get the home price index and consumer confidence. on wednesday it's durable goods and pending home sales. thursday is weekly jobless claims, of course, and a final estimate on first quarter gdp. the june chicago pmi and more of your data on consumer sentiment. [ male announcer ] this is the at&t network. in here, every powerful collaboration is backed by an equally powerful and secure cloud. that cloud is in the network, so it can deliver all the power of the network itself. bringing people together to develop the best ideas -- and providing the apps and computing power to make new ideas real. it's the cloud from at&t. with new ways to work together, business works better.

♪

thanks for joining us thanks for joining us on this monday morning. these are your headlines. spain formally requests a bailout for its banks but stops short of declaring the actual amount of cash. >> india takes measures to prop up the struggling rupee. >> and whether president obama's health care law is unconstitutional. egypt's new president mohamed morsi will begin to build a new administration in the north african country. yousef has more on the story for us from dubai.

we're seeing the egypt stock market up nearly 5%. does the rest of the country agree? >> reporter: well, it seems to be the case. investors have been quite afraid of the political turmoil that proceeded the elections and so seeing the elections get to a stage of completeness and a winner announced is seen as a good sign, as a sign for stability. and what everybody is hoping for, at least the ones i've spoken to is that, again, morsi will be given the powers needed to bring on that stability. but a lot of question marks behind that, kelly. the reality is that a lot of his powers are likely to be curtail curtailed. the presidential powers have yet to be outlined clearly. parliament is effectively dissolved and the questions, of course, remain how much the military will give away from its power base. they have a lot of interest in the country, economic interest from an investors perspective,

the economy is in shambles. imf expects growth of 1.5% this year. of course that is far from the number needed to really create jobs and help the country recover, also government borrowing costs are at unsustainable levels. they are struggling to secure external financing to address the budget deficit, foreign currency reserves are under pressure. the road is still a very long one. >> thanks, yousef. what does all of this mean for price loyal? >> it's interesting, isn't it? it's not clear to me that egypt is going to be stable as a result of this election. it's been one of the great rocks of stability and what's interesting in terms of oil we've seen so much of the bid come out of the price. it's almost as if the whole

uprising geopolitical risk has been bid out. so i think oil is arguably attractive at these levels. >> what's it going to do for the global economy? how much of a nice offset is this? >> this is fantastic for the global economy, a stimulus of $800 billion in three months in terms of purchasing power. it's enormous in terms of support -- >> too bad it always comes on the back of global uncertainty, though. much more on that coming up. a company whose business is linked to the rise and fall of the crude price. 

the dow lower by 78 points and s&p 500 down 11 and a half and the nasdaq down 21. this follows an okay stretch for stocks the last couple of weeks. the same is not necessarily the case for oil. brent crude prices are down about a quarter in the last three months. flirting, trying to hold that

$90 level. our next guest says the move back to a bear trend is likely to be a down side catalyst. joining us is the senior sales trader. darren, welcome. we've seen a 25% move lower so i imagine a lot of this has to be priced in. >> not necessarily. brent, crude and wti capital from the commodity. you have more important for demand. >> how low do you think oil prices are going to go then? >> as far as brent is concerned, up to $80 for these commodities.

>> we are also in a severe crisis. who wins, who loses? >> well, the losers are stocks like premier oil, producers of brent crude accounts for 25% of their production. obvio obviously the higher the price the better it is. this morning in terms of plugging a disappointing in indonesia and down again. >> we also have to sell and this is the manufacturer of pumps and equipment. you're jacking up the sort of

relative cost of shale. >> it's all tied in together. it is correlated to the brent price but it's our recommendation and prices have collapsed in the u.s. that would be bad news. shale is this great boone for the u.s. in the longer term. >> it is bringing an energy revolution. personally the oil price is balanced. and it is not the case that it

is no longer worthwhile. >> it's speculative. you have to come in with your eyes open. is attracting the attention of purchasers of the stock. some suggest it is worth three pounds 90. there is a possibility krcredit or even the management could come to an agreement with a specialist insurer. they always talked about it. the cost of putting the scheme to bed is around $700 million.

it's not unreasonable to expect the valuation around two pounds 90. some suggest that the business itself is two pounds 15 a share. >> good to see you. a couple of sell ideas and purchase. the supreme court may decide to strike down president obama's reforms. >> athena health's ceo. don't go anywhere. choose control. introducing gold choice. the freedom you can only get from hertz to keep the car you reserved or simply choose another. and it's free. ya know, for whoever you are that day. it's just another way you'll be traveling at the speed of hertz.

welcome to welcome to "worldwide exchange." if you're just joining us, i'm kelly evans. >> and oim ross westgate. madrid formally requests aid to recapitalize its banks, but no bailout amount yet specified. the yield is ticking higher. cypress is in junk territory. it may be slashed further as the european crisis worsens. no relief for the rupee. the moves leaves investors disappointed. >> and it could be decision day as the u.s. scored could decide whether president obama's health care law is unconstitutional.

well, believe it or not, we've had had an okay couple of weeks for stocks. not the case this morning, though, for those just joining us. a reminder that futures at this point for the dow jones industrial average are pointing to an open lower by almost 80 points today. meanwhile the nasdaq and s&p are pointed lower as well. s&p 500 pointed down by about nine points. that level currently about 1317. we'll see if it heads back to that mark. in overnight trading the ftse cnbc 300, we are doing okay. sentiment has weakened. we're seeing this across asset classes. the outperformers is egypt in the wake of the the presidential election results yesterday. mohamed morsi of the muslim brotherhood takes that victory, that stock exchange up nearly 6%. here is what's happening across europe, though. the ftse 100 over here is down 0.7%, almost three-quarters of a

percent. the xetra dax is down. out of spain, this may help explain what's going on, down 2%. it's been leading the rally the last couple of weeks but now sentiment turning weaker. this as investors await the details of the request for aid that spain has formally asked for. ross? >> yeah, absolutely. july 9th, as you say, can kelly, will be the date that will get an official memorandum. that's where we stand ahead of the u.s. open right now. what are investors to do? a snapshot of what some experts of cnbc have been telling us at the start of the week. >> well, i'm looking at selling the ten year, buying the five year and the 15 year. the 15 year is a very cheap part of the curve and the five year is traditionally, well, it performs very well when the market rallies. >> most likely the existing

equity is not worth it. the time to consider buying them is when the losses have been taken, recognizing they're recapitalized. >> i think a lot of these prices are a function of the liquidity that's been injected and a lot of the collateral easing rules that have been implemented or suggested over the weekend. so i wouldn't say these are the real prices the spanish yields would trade. >> the u.s. supreme court today could rule on whether president obama's health care law is unconstitutional. rulings and cases are typically announced around 10:00 a.m. eastern. at issue whether congress exceeded its authority by passing a law which requires all americans to buy health insurance. the court could strike down the entire measure, just part of it, or keep all of it intact. joining us now is the health care practice direct or at --

europe director at frost and sullivan. and i guess the question for you is whether you expect it to be struck down all, in part, or not at all. >> they are grappling with a fundamental question. the question facing health care providers the world over, which is who pays? that's the question. i personally expect a 5-4 decision to strike down the provision that requires every u.s. resident to carry health insurance. that intrusion into the lives and decision making of individual americans would be a massive shift especially what the framers have envisioned. i expect them to strike down at least that portion of obama care. >> people try and hand cap the odds here, it seems as though they've shifted from what you're talking about to maybe it could survive intact. who wins?

who hurts most if they overturn it? if they strike it down? >> if they strike it down, the health insurance companies in the u.s. will be hurt the most, i would say. if if they allow it to go through, there could be a whole lot of unforeseen impacts. for example, obama care has a provision that would require catholics hospitals to perform abortions. if that goes forward and catholic hospitals decide to buck that trend, it could have a massive impact on a supply/demand mismatch already seen in the health care system in the u.s. between the demand side patients coming in and the number of hospitals and beds that we provide. >> why do you think someone aside from the sort of interesting political questions that thisraises, why should your typical investor be focused on this ruling this week? >> i'll tell you why. because for the last three years there has been a loud of

uncertainty over this entire space. so any company playing in the health care space has been facing, you know, this cloud of uncertainty. will obama care actually get through congress? it did in 2010. in what form? largely boiled down. would it survive the legal challenges all the way to the supreme court? that's where we are now. and this decision almost one way or another is going to be a good thing for stakeholders in this space because hopefully it will help the cloud of uncertainty to dissipate. so i would -- that's why you saw health stocks going up last week. i think no matter what happens, uncertainty will dissipate and that's a good thing. >> you made this point in your notes, regardless what happens today, the proportion of gdp spent on health care which you reckon is 6% gdp already unsustainable. you say that's going to go up to 30% by 2050. >> let me tell you those numbers specifically. in 2010, $2.6 trillion spent on health care in the u.s. that's roughly 15% to 16% of gdp. now we as a firm did an analys s

analysis. i asked our guys, project forward the way economists think about this, all things equal, what would 2050 look like? they came back with a 30% of gdp spent on health care. completely unimaginable. this world needs reform. >> if we as sort of a society -- and i'll let chris get in here -- are spending more and more of our money, of our resources on taking care of our aging population, is that really that surprising? >> it's not that surprising. >> it's untenable. >> it's clearly not sustainable. there's no chance that you could go to 30% of gdp. it's just not feasible. the bond market wouldn't allow it. but that's interesting. so if this goes through, then the interesting question when does it become averse. clearly the numbers tell you it must be reversed. that depend on the winner of the presidential election and so on. >> i think this is one of the fundamental issues, why president obama spent most of

his chest of goodwill, his war chest, if you will, of goodwill on reforming the health care system. it is so badly in need of reform. however, i don't think we've reformed what really -- what will really create a better cost scenario. in fact, we may have added huge amounts of cost into the system. >> what's the best way to move forward on this in your view? >> well, in my view the question is always who pays? and that can be answered by the government might pay, insurers might pay, individuals might be force forced to pay which is what the supreme court has been grappling with, but what about other options? what about families? what about community groups coming together forming cooperativ cooperatives? what about churches? the catholic church with its hospital provision is a very interesting potential avenue. so there are lots of ways. >> is it possible we get clarity on this from the supreme court this week only then to face the prospect of a different

administration in the fall which could do things in a totally different way? >> yes. mitt romney is on record saying he'll overturn this if he gets elected. i think what we see all the way stretching back to the ill-fated attempt of hillary clinton in 1993 to reform the u.s. health care system. obama care, all of that war chest of goodwill spent on a signature piece of legislation could well be rendered unconstitutional by the supreme court today. it's a scary area to wade into and yet we must look at reforming health care for the good of the ultimate stakeholder of them all, the patient. we've got to find a better way to provide care for individuals in the u.s. >> it's an interesting concept because if you had a democratically elected government, what you are saying here is the basic constitution is greater than the will of the people at that particular moment is what we're saying.

>> well, this is very interesting. this is what the supreme court has to grapple with. what it did the framers of the constitution have in mind? and should that trump what the polls say? right now the polls are pretty far in favor of overturning aspects of this and yet there are certain parts of the law that the american people would love to see even more reform. it's a very complicated area. it will be very interesting. hopefully the cloud of uncertainty will dissipate. >> the key is, will today be any better? will it be any better this week for health care providers to say we can move on and if that happens that will be some benefit. thank you very much for joining us. some news over the weekend. fernando alonzo won the grand prix and started 11th on the grid. he managed to clinch his second victory of the season despite leading 35 laps.

vettel the fourth to retire. second place hamilton t-boned just three laps out. alonzo gradually clawed his way up the rack to record an extraordinary result. he's moved himself back into the lead of the season's championship as a result. and staying with the sports news, italy dumped england out of the european football championships. they won 4-2 on penalties during a night of high drama in kiev. d despite dominating throughout italy failed to take their chances and break down a resilient and organized english defense over 120 minutes, 30 minutes of extra time. penalties followed and when ricardo's miss was counted out from england's ashley young and ashley cole, it was down to dimonti. italy will meet germany in the semifinals, the match to be held in warsaw on thursday. >> can't we resolve the debt

crisis in the same way? >> what do you think? >> germany would win it. >> germany would still win. >> spain would have a fighting chance, though. >> they might. >> portugal even. >> england wouldn't be in it. they would clearly lose. still to come on the show, pixar enjoys its third biggest box office opening weekend ever with its new release. and we'll get you details on that just next. [ male announcer ] this is the at&t network.

a living, breathing intelligence helping business, do more business. in here, opportunities are created and protected. gonna need more wool! demand is instantly recognized and securely acted on across the company. around the world. turning a new trend, into a global phenomenon.

it's the at&t network -- securing a world of new opportunities. ♪ welcome back to welcome back to the program. earlier we asked and we were just talking about obama care and the prospect of it being turned over this week by the supreme court. many of you have written in with your opinions, not surprisingly. david, for example, says although he strongly dislikes many aspects of the legislation, he still feels it should be passed by the supreme court and that is upheld. he says some parts of the law like those covering pre-existing conditions are needed. agree, it disagree, let us know. send us an e-mail or tweet us. >> they can't see this guy yet.

yeah. don't miss out on the conversation. i thought we would just take a look at what's going on with commodities. bear in mind the big falls we had last week particularly in oil prices. brent, we did get over $91 a barrel this morning as we see tropical storm debby developing in the gulf. back down to this 90 level. for brent, all those coming really post the fed. nymex this morning just on the 79. you have to remember up to 125 for so long with brent. a lot of price has come out certainly in the last four sessions and it is holding those drops lower at the moment. spot gold here, 1,5 8 is where we stand. down 3% last week. 1,567 is the level we got to. copper this morning, we did have an early bounce off six-month lows but it's come down now. the copper price at 330 is where we stand. so those losses on commodities

pretty much sustained as we go it through the early part of trade here in europe to date, kelly. >> all right. this is "worldwide exchange" and these are your headlines this morning. spain formally requests a bailout for its banks but stops short of declaring the actual amount of cash needed. india's central banks takes measures to prop up the str struggling rupee and the u.s. supreme court may rule on whether president obama's health care law is unconstitutional. and qatar is hoping china will consider boosting its foreign investment cap to $5 billion from the current $1 billion allowed to each qualified investor. qatar officials told chinese media it plans to allocate funds mostly into the equity markets and ipos. last week china said it's look ing to it ease the entry rules for approved foreign investors. this as part of beijing's broader plan to stimulate the economy. >> and india has introduce add series of measures. the central bank says one of the moves includes raising the limit on foreign investment by $5

billion to $0 billion. investors don't seem to be that impressed. the rupee which had strengthened ahead of the announcement is now, well, it's off its lower levels. the dollar is still down on the session. we are weakening. eu leaders will discuss the details of the four pillars they believe are necessary to discuss the future of the eurozone. this is when they convene on thursday and friday this week. talk is of a banking union. more integrated budget policy as well as plans to deepen economic ties between member states. >> research in motion is considering splitting its business in two. the uk sunday times says the blackberry maker may break off its hand set unit into a separately traded company or sell it outright and open up its popular messaging network to rivals such as apple or google. a review of business after filing behind in the smartphone market. its share price is down more than 80% as you can see there in the past two years.

and it was a good weekend to take the kid to the movies. "brave" from pixar debuted at the top of the u.s. box office with an estimated take of $67 million. it's the third best and features a female lead character, a scottish princess voiced by actress kelly mcdonald and, i meanwhile, am getting harassment for my pronouncement of scotland over here. >> set in tenth century scotland. >> it's a bit different. i'm still not crazy about the title. "brave" is kind of bland but didn't keep it from doing quite well. >> they just took off the heart, didn't they? >> the female version. it's been a good version for female leads with that and "the hunger games." still to come on the show, a down day for u.s. markets. the german bund showing that flight to safety as it moves lower. we'll preview the trading day

live up next. . ♪ [ engine turns over ] [ male announcer ] we created the luxury crossover and kept turning the page, this is the next chapter for the rx and lexus. this is the pursuit of perfection. 

this is this is the start european markets will get to the u.s. later today. the ibex down 2%. the cac up 1.4%. the ftse down moving back above the level, kelly. let's get a look at what's on the agenda in the u.s. this week. today may home sales out at 10:00 a.m. eastern. tomorrow investors get the kay schiller price index. wednesday it's dushl goods and pending home sales. jobless claims and the final estimate on first quarter gdp.

may personal income and spending, the june chicago pmi will be one to watch. u.s. futures in the red across-the-board there. we've added to that a little bit this morning but not too much morning. ben lichtenstein and chris wattling is still with us. ben, to you. we're starting the week off on a bit of a weak note. what do you expect? >> reporter: we are set for a negative open, a lower open. i think traders will be keeping an eye on crude. we're looking at the $77 level. we hit it in june. the same thing, october 2011. and now recently 2012 we tested this level. i think traders will keep an eye on it. whether we see a bounce off this level but the s&ps are really

looking at this 1,300 level after having last week failed in terms of the upside activity. unfortunately we're just shopping around, though, not very well defined balance that's been forming in between like 1350 and 1250. all eyes on the crude and the gold right now. >> is it central banks, bank of england next week, is it going to be more stimulus? is it the outcome of these policy meetings? >> investors are waiting for the uncertainty. unfortunately i think most people are out there saying and understand that's not going to

happen overnight, the situation that we got ourselves in didn't happen overnight and we're not going to get ourselves out of it. we're looking at just kind of a little bit of a chop type trade until we see more optimism. a lot of concern out there and uncertainty. >> what about the payroll? that's pretty key in terms of whether or not we eventually get q/e. what are market expectations and how do you see that into that data point? >> i think we've been watching the jobless activity and the jobs data and for the most part similar to most of the other economic data that we're going to see it's been lackluster.

we have numbers that were not very desirable so a much lower jobs data has brought a boost to the market. again, we're seeing traders starting to get some sort of stick lus. expect the unexpected. we will be looking for that to play. >> ben lichtenstein, thanks for that this morning. and, chris, just real quick because your last call was to get exposure to risk again are you going to take that back off? >> on a two week we went short in the middle of last week. our models were unfair. >> all right. that's your trade. thanks for coming by the studio. >> that's it from "worldwide exchange." "squawk box" is up next.

good morning. today's top stories as eu leaders prepare for that summit in brussels later this week. spain now officially requesting its bailout for the banks. and here comes debby. a debby downer. a tropical storm off the florida coast forcing closure of a quarter of the offshore oil and gas production in the gulf of mexico and it is the supreme court ruling set to announce on the president's health care reform. it's monday, june 25th, 2012. it all could change today. "squawk" begins right now. good morning, everybody.