edition of worldwide exchange." i'm ross westgate. >> i'm kelly evans. these are your headlines from around the world. markets in europe come off four month highs as asia sees a rally. >> and a lifeline for knight capital. it may come at a cost to existing shareholders. >> emerging markets continue to boost sales of cartier. >> and a new search for life begins on mars as nasa successfully lands its curiosity

recover on the surface of the red planet. and i have landed successfully in front of the dow jones stocks heat map. advancers out pacing decliners by a ratio of less of 6-4. signs of life in european stocks. we've got the ftse 100 up 2.6%. down marginally today. up four weeks in a row. xetra dax today starting off 11 points up. the krak down and the ibex is back up. big rally with banks on friday.

there's a plan, creeping towards a plan in europe. employment report helping out as well. take a look at yields all-important yields. spanish ten year still around that 6% market. ten year spanish yields 6.813%. hasn't changed an awful lot before the draghi statement just often days or so ago. u.s. treasuries 1.55%. post-jobs yield higher. currency markets euro/dollar hit a four week high. 1.2361. the aussie/dollar still at a high of 1.0544. we go to singapore and see what's happening in asia. >> asian markets are tracking

higher following positive release from the u.s. and europe. but also bolstered by more talk of policy fine tuning from the ppboc. shares of hi-tech development parks gained almost limit up on news the country will expand its over-the-counter into four new cities. volumes were ahead of key economic data. there's speculation around the countries. in hong kong the hang seng at one point reached to the 20,000 mark for the first time since may. also a nice rally out of japan higher by 2%. thanks to that upbeat jobs data. automakers climbed after toyota posted its highest quarterly net profit. kospi gained at a seven week high. the aussie market is up by 1%

with material stocks in energy companies leading gains. lastly india the country's retail sector was revised to negative but the sensex now trading up by more than 1%. back to you. thanks for that. what a weekend. i was going say. >> i have to say you guys did quite well. newscastle the women's soccer team, u.s. women's soccer team got to win. i got to see some of the city and the ruins. we were amazed we could walk up to this ruin. no glass. >> my stat, i told you about this earlier, if you took -- if swimming wasn't an olympic sport, great britain would be on top of the united states on the medal table. >> great britain may have a couple of special sports, cycling, rowing that are helping as well.

>> sailing. >> sailing. >> we're very good at that. let's bring in our fixed income strategist. you've been enjoining the olympics. >> i have. i was at tennis yesterday. >> another great -- >> that's my favorite. i love the tennis. >> one sport where we don't have someone dominating the field. >> cheerleadinging the olympics, investors have had a bit of cheer leading. jobs report and post -- the ecb might get something. let's hone in on the jobs report. has that changed your thoughts about anything >> hasn't changed our thoughts hugely. it's still a little bit wait and see mode. you know, the election is coming up and all that stuff. still the fiscal cliff is an

issue. >> wonder if we're not into a situation where after pricing in a lot of economic weakness all of a sudden the outlook looks better, the job report surprises to the upside, is the ecb doing enough. are we at a similar pivot point where the outlook brightens? >> we're at the crux in the eurozone at the moment. the next couple of months will prove crucial. huge implementation risk with regards to what the ecb said they would do and with regards to the constitutional court ruling coming up in germany in september. politicians are hoping and ecb is hoping they can get through august and then -- >> there's nothing -- >> largely -- >> spain doesn't need to go to the markets. they can get through october presumably without -- >> there hasn't been an event risk. it's not as if it was a spanish auction or was a catalyst for a big move. seems to be just this constant data flow in repricing

expectations. >> august is high in liquidity. august can be a bad month. if we get a couple of negative things, negative headlines coming out from eurozone politicians these kinds of things can snowball. it wouldn't surprise me if the ecb comes out with further details this month. >> china is grappling with shrinking demand the country's central bank reconfirmed to step up policy fine tuning. these include improving research to better steer policy, widening the use of the u.n. and prevent systemic risks in the financial sector. good luck with that. mario monti says italy needs moral and not financial support from germany and berlin should give some lee way. this as the central bank governors says rome doesn't need to ask esff to buy the country's

sovereign debt. eurozone monetary policy is likely to be looser over the coming months amid the ongoing crisis. >> greece's international end is returning to athens in september after what's been described as productive talks. troika officials says greece has made good progress in its reform program. >> spain will not be asking for a bail out until there's greater clarity on conditions that would be attached to a rescue. the country's economy minister said madrid is in no rush to request aid. julia chatterly, is spain hoping it won't have to sign some memorandum of understanding in order to get relief here? >> reporter: it's a good question. remember they've already signed

a memorandum of understanding with regards to the financial sector bail out but the prime minister has promised the people that would be the only bail out the country required and wouldn't need something more comprehensive. if you look at what the economy minister said over the weekend add that to what was said on friday when the tone was changed from denying a bail out was needed to suggests they need to understand the terms from the ecb to consider it. we've seen a tone change, a sign of flexibility where a bailout is needed. what the economy minute terrify said, though, they are not seeking it immediately and he said they've done 70% of their funding already this year. we know they don't have to raise medium or long term debt until first week of september. we heard a couple of weeks ago that actually the average cost of funding this year is still below what it was in 2011. they have some leeway. an official suggested the esff

will not be buying debt for august. it's a case of waiting. we're waiting to see what the ecb says about their plans for bringing t ing thing the periph down. of course we have to wait for spain to see what they do in the interim. plenty of moving pieces. we have to wait and see. >> plenty of traffic behind you as well. julia chatterly in madrid. do you buy spanish bonds at these levels? >> it's difficult. you got to treat spain in two different ways. ecb have said they would support significantly the front end of the curve. at the moment buying spanish bonds is a good strategy. but there's this huge implementation risk involved. spain will have to enter some form of new memorandum of understanding. in order to force them to do this, spread over germany will have to widen in the short term.

so perhaps looking at the short end is the safer play at the moment. >> do you think it's significant spain is no longer saying no they are just quibbling about the price? >> yes. >> what about italy? as soon as spain appears to resolve any road to resolution, italy will loom large. >> it depends how far the ecb go in their program. if they put in a credible framework it may be enough for italy. >> ecb is talk being about unlimited buying and that's a major -- >> the market is slow. the market teed up for something immediate. what happened was massive. huge step for the ecb moving more to the policies, the bank of england. the significance is huge.

just the implementation. >> actually diplomacy of the two marios has been extraordinary. monti working the political leadership and draghi working -- basically isolated -- managed to get the ecb behind unlimited support of eurozone debt markets. >> yeah. exactly. the bund bank is a slightly funny situation because they protested and then gone along with it. as much for their own sort of credibility they love to have. so it's always difficult to know what they are saying in public and private and what they think on it. it's a major step. basically everyone is on board for this kwqe type of activity. >> major step. do we end this space here. we'll be back later in a couple

of minutes. >> knight capital has report ad deal with a grouch investors for an infusion of $400 million in capital. cnbc first reported the deal this in the form convertible preferred securities could give shareholders $1 each. the deal will allow knight to open for business today after taking a crippling $440 million loss following last week's trading glitch. they will massively dilute the company shareholders and knight closed at $4.05 on friday. former barclays swap trader is being investigated by u.s. authorities for his role in the libor scandal according to reuters. in a separate report the uk "sunday times" said it could block the pay out of top officers bonuses. >> around 24 trade managers have been fired from u.b.s as part of

an investigation. this according to a swiss newspaper. ubs is not a central player in the probe into its straight manipulation. elsewhere, shares in richhemont is higher. no better person to indulge in a bit of luxury than caroline who joins us from zurich. what stood out for richemont. >> reporter: we got all these companies coming out with negative profit warning. for a change richemont comes out with a positive profit warning. it saw sales up by 24% in euro terms. this company now expects a 20% to 40% increase not just in the operating profit but in its net profit for the first half the year and this is the period from

april to september. so very, very bullish outlook, caught the market by surprise because again it was a surprise trading statement. a large part is to demand. specifically in asia. there's one weak spot and that's as usual and that's the company's outlook. many factors driving the results are uncertain such as the currency situation, remember. this company doesn't report in europe. richemont nicely higher. ross. caroline, thanks very much. >> coming up on today's show we'll get out to western australia where the annual dealers mining conference is under way. we'll check in on indonesia's economy that picked up more than expected in the second quarter focusing on the country and kg what's boosting growth. >> we'll be in brussels to catch

up with the u.s. chamber of commerce. and we'll be in chicago to discuss the future of algorhythmic trading. >> and curiosity has touched down almost exactly on schedule at 7:30 this morning. it will spend two years on the red planet looking for examples of life. >> that's prompted us to ask whether the mars probe is a good use of u.s. taxpayer money. these things don't come cheap. nasa has been abandoned as austerity times start to kick in. what do you think? join the conversation here on "worldwide exchange" by e-mail at worldwide@cnbc.com or tweet us at cnbcwex.com or reach us

directly @kelly_evans or @rosswest gate. at&t network. a living, breathing intelligence teaching data how to do more for business. [ beeping ] in here, data knows what to do. because the network finds it and tailors it across all the right points, automating all the right actions, to bring all the right results. [ whirring and beeping ] it's the at&t network -- doing more with data to help business do more for customers. ♪

okay. big focus on wimbledon at the olympics this weekend, final men's tennis tournament or

repeat of last month. andy murray against roger feder federer. he held on to become the first british man to win olympics single gold sin 1908. first time the olympics were in london. >> incredible match. final of the men's 100 meter saw bolt looking to maintain his title. his rivals were johan blake and tyson gay. bolt was too much for his competitors and set a new olympic record. >> china still tops the overall leaderboard. usa trailing by two gold medals. great weekend for team gb and now up in third place, 16 golds, 11 silvers and 10 bronze at 37 in total. >> china and usa still neck and

neck. on today's schedule there's the semi-finals of the women's football or soccer competition. and the athletic sprint or track and field. the main events are the men's 400 meters and the women's pole fault. by athletics you're referring to track and field, right? month maybe. >> i think so. it's a little bit strange. >> no. athletics is athletics while football is football -- >> they are all athletics. >> no. athletic. athletic pursuit. >> speaking of athletic or how about this, impressive performance, prada reported same store sales were up 19 -- >> athletics on prada. first half revenues up 36.5%.

same store sales up 19%. given some of the weaker luxury figures not too shabby. australia, hundreds of top mining executives are gathering in the western resource town to talk shop at the annual diggers and dealers conference. cnbc matt taylor is on site and he sent us this report. >> reporter: this is the 20th anniversary here of the diggers and dealers conference that's taking place in the west australian city. we're expecting more of a somber tone this year given the fact that we got falling commodity prices, the big miners have seen their share prices come under significant pressure and we're dealing with a slow down in china which does affect demand for australian resource stocks. but so far today we haven't seen

too much negativity. one significant dealer announce in silver resource says it's planning to merge with integra mining. it will create a gold mine worth $1 billion. we heard from forestry metals. it's received financing for about $1.5 billion to help expand its iron ore operations. the former managing director of the international monetary fund said that europe really needs to get its house in order. that could have some big flow in effects through asia if the situation is not resolved quickly. he did however say, though, emerging markets really are buffering the rest of the world economy when it comes to preventing a protracted slow down. here's some of what he told us a little bit earlier about the situation in europe.

>> we need in europe decisions to solve the financial crisis in europe by reducing interest rates in some countries, what some countries are paying for finance. and we need also to strengthen the union in terms of fiscal union and banking union. those are the objectives but what we need is action. >> reporter: that was the imf former manage director. day two of the conference getting under way tomorrow. big focus as well on gold miners and just why some analysts think they are an attractive investment proposition. we'll bring you those details tomorrow. back over to you. >> all right. let's get back with our guest for this hour. we were just listening in there to this major commodities conference. should we be sort of unsettled by the weakness we've seen in the commodities trade lately or how do you kind of position

that -- how do you recommend exposure there for investors? >> just on a bigger picture it looks like slow down in china, not huge growth, pickup in u.s. and eurozone still struggling to grow, really. so, the obvious thing is for commodity weakness to continue. >> how much more attractive is australia's debt going to be. not many aaas left. i wonder if that spells into the regional debt markets. if you're a global investor, how attractive has australia become? >> one of the issues with australia not a huge amount of the debt to invest in. relatively small country. and the other factors, you got the currency volatility to take into account. if you are an eu investor you want to be in euros or dollars because they are the largest currency markets. you don't want to be tied to the

usay dollar tied largely to china. >> barclays research saying that offshore holdings of sovereign bond issues in australia up 83% from 70% a year ago. >> it's kind of a natural thing for those funds to have to invest or have certain pa parameters around aaa. it's decreased markedly. look into aussie. >> more to come from you. stick around. here's what's coming up. indonesian gdp numbers surprised to the upside. what's boosting growth when we come back in just a few moments. [singing] hoveround takes me where i wanna go... where will it send me... one call to hoveround and you'll be singing too!

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these are the headlines from around the globe. european stocks are at four month high. >> knight capital gets thrown a lifeline. the troubled trading firm seals a deal for an injection of new capital but may come at a steep cost to shareholders. >> emerging markets continue to

boost sales of richemont. and a new search for life on mars begins as nasa successfully lands its curiosity recover on the surface of the red planet. one and a half hours into european trading day. european stocks are mixed. it follows good gains last week the ftse up 2.8%. four weeks of gains last week. the cac is flat. the ibex up a quarter. >> for bonds let's take a look at the action across the curve. at least across the ten year. spanish bond is at 6.79%. yields coming in across the board. italy at 6.02 this morning. le gilt and bunds down 1.39 in

the bund yield and 1.51 on gilt. >> euro dollar hit a high. we bounced back from that 1.2364. >> indonesian gdp numbers surprised to the upside with second quarter growth clock in at 6.4% year-on-year. the indonesian market expected slowing exports to hit southeast asia's largest economy but strengthening domestic consumption and investment offset export weakness. joining us now for more is regional economist at barclays. thanks so much for joining us. we heard a lot about indonesia over the last several years about being one of the next big marketing opportunities. are these figures consistent with that theory? >> well i think yes, q2 growth

numbers were stellar especially in an environment with global growth environment so weak. i think clearly what saved the day was investment demand, investment riding 12.3% year-on-year and consumption holding steady. >> what's your view for the rest of this year going into 2013? >> well the second half the year we are going to see some moderation, especially in investment. i think here it's safe to say business will become a bit more cautious given the external environment. we can see this in lead indicators. imports of capital goods as well as investment related credit has already begun to moderate. but consumption i think will be the main support for the economy. >> is there a risk then that we're actually at maybe one of the stronger points of performance and that it moderates from here? >> yes. i do think it will moderate from

here. we're still looking for 6% growth for indonesia which on a relative basis would still put it in a good stead. >> further easing, how much -- what is your forecast? >> for dollar factor it will remain on the back. if you look at the current dynamics in indonesia extremely weak. at the same time the political risk as well as regulatory uncertainty in the country is increasing. 12 month forecast is 9,500 and going to be the under former within the barclays forecast for all the asian currencies. >> if i can bring you into this conversation, lynn. are you guys keen on indonesia? do you see it as one of the stronger emerging markets? >> it's not a market we look at hugely. as a region we're positive on the region. look at the future that's going to be the growth engine of the world economy in future years.

>> despite the fact you're somewhat cautious on china's outlook? >> that's more of a short term issue. a lot of that is tied up with the export markets. if we see a resolution in the eurozone perhaps a return to stronger growth in the u.s., associated with increase in confidence, the eurozone sort it out and that's good for world economic growth. >> i would imagine that what happens with china is also a pretty big swing factor in your outlook but it sounds like whatever those challenges in the short term may be there are still some drivers for indonesian consumption at least? >> yes. that's key. if you look at indonesian exports nearly 65% of the country's exports are commodities and china in some sense is driving the world's commodity dynamic itself. indonesia has been seeing negative shock over the last couple of months. on the consumption side the thing to highlight is that labor

markets are fairly resilient and the sector which is more vulnerable to the global cycle which is manufacturing as well as financial services makes up under 18% of total employment putting indonesia favorably to other markets within the region. >> thanks so much for joining us there. regional economist at barclays. and over in japan similar story in terms of waning demand from europe but industrial exporters are coping dumifferently. nikkei carmakers are calling off deals with joint players. we have a report live from tokyo. >> reporter: thank you, kelly. as europe's debt crisis continues to hurt sentiment in the region's car market japanese firms are reviewing tie ups that could be impacted. isuzu cars is planning to pull

out of their polish joint venture. they will cut the workforce of european business by 10%. mitsubishi has stopped it's development of electric cars. mazda will switch to its own engine for european models to help minimize risk from region's debt problems. but not everything is being called off. japanese and european automakers will step up partnerships on green technology and hybrid vehicles. back over to you. >> thanks much for that. >> shares of hon hai is up. sharp is down 5.8. hon hai agreed to buy the company. since then sharp has lost more

than 60% of its value. shares of singapore fraser an neave has jumped. they will own more than 80% of ti ber beer. investors speculate that the singapore conglomerate will be broken up. coca-cola is eyeing their non-alcohol jake division. after years of boom australia's mining industry is dealing with a potential slow down and amid gerns of china and europe. when cnbc visited northwest australia over the weekend they found a resource port operating at break neck speed and some big miners are pushing on with multibillion dollar expansion plans. matthew taylor has the report. >> reporter: these huge ports

capable of shipping hundreds of thousands of iron ore 24 hours a day, seven days a week. australia's big ports are exporting record amounts of iron ore and big miners are spending big to capitalize on the ongoing demand for raw materials freps our nearest trading partners in asia. >> iron ore is all about infrastructure. it's a game buflding as much capacity as you can and you're always limited by the extent of the most recent expansion program. >> reporter: rio tinto is expanding its port facilities and planning a $19 billion port upgrade of its facilities. >> facilities are very close to their or above their capacity in terms of the reliability it's very high, 90% in terms of reliability. >> reporter: this is rio tinto's

facility located in western australia. currently the largest in the region. iron ore from 14 of rio tinto's inland mines travel 1500 kilometers by rail before it's offload at the port, sorted and shipped. rio's main focus is expanding this facility which will help the miner achieve its plan of expanding its operations to 353 million tons of iron ore by 2015. it will process 183 million tons per year. this is where the iron ore leaves australia in ships like this year. they handle about 1500 cargo ships each year, most of those are bound for china. but concerns australia's resources boom may about to run out of steam have raised questions whether such massive

expansion is necessary and reports suggest bhp is considering a possible delay to its big spend port. if there's a slow down miners need to innovate. >> miners have been focused none creasing volume and taken the eye off the ball in terms of operating costs that as prices come off focus will once again shift to the cost situation and they will be working very hard to get the cost down. >> reporter: others see australia's mining boom unabated as the investment pipeline continues to come online. yet we probably past the point where you keep getting additional support for growth. that investment to gdp ratio is expected to probably peak in 2013. but we have to keep in mind that there's a lot of exports dwroet come online. >> reporter: in the meantime the ships keep coming and the miners keep digging.

well believe it or not, this week marks five years since it was traditionally thought of as the start of the financial crisis. that's when money market funds as a result of subprime exposure or exposure to u.s. subprime mortgages. let's walk back in time and get a sense of everything that's happened then and since. 2007, august, b and p freezes. very soon after that people started to look at those interbanking spread libor u.s. spread that are often thought of as the thing that being kicked off the financial crisis. by september 13th, northern rock gets an emergency liquidity. by december there's coordinated global easing action, five central banks involved in that

one. fast forward into 2008 then we start hitting those events. jpmorgan buys bear stearns in a last minute deal. by october $800 billion package passes congress in the u.s. 2009 the recession has fully set in. uk among those countries entering some of their deepest recessions. march aig posting a record loss. june gm entering bankruptcy protection. remarkable to think now how long it's been since those plays. >> we got the first european bail out at that particular moment. first greece bailout was approved. one bailout that took us into bail joult road in november of 2010. island bailout was approved. we'll have a bailout before it happened. then in may 2011, portugal

bailout. last november we also had the berlusconi change of government and their yields shot up over 8%. back in november last year eurozone agreed 50% hair cut. what goes down the end of this line here, do we get full sovereign bailout that allows us the use of the esff and ecb stepping in. that's the next chapter to be written. still to come we'll hear from the u.s. chamber of commerce european representative. they think they can boost growth. that's coming up next. [ 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,

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journey, curiosity has landed on mars. it will spend two years on the surface of the red planet looking for evidence of life. do you think the mars recover was good use of u.s. money. the only thing we've achieved from the moon exploration is duct tape and silicon. jeff says if you have to choose

between shooting into space or giving exxon tax rebates he would rather spend the money in space. join the conversation, worldwide@cnbc.com. or cnbcwex.com. tweet or @kelly_evans or @rosswestgate. mars curiosity is what's tweeting directly, so nice tweet. exclusively, kelly, i can reveal to you exactly what they will find on mars. i'll tell you exactly. do you know? >> no. >> they will find men. >> ross! i'm guessing everyone -- >> isn't that where men are from? >> okay. on that note, lowering trade tariffs could provide a much needed boost for the eurozone's economy according to peter h. chase senior representative of

the u.s. chamber commerce in brussels. i asked him not if men are from mars but whether u.s. and european trade relations could benefit from better integration. >> the u.s. and europe economies are deeply integrated but they can be much more integrated. when you have such a large trade tropical if you reduce even low barriers you get an increase. we've estimated that it's about $180 billion of additional gdp to the u.s. and eu. >> what are some of those tariffs. what are some of the most significant barriers? >> the tariff, a lot of them are in cars which you wouldn't expect. some machinery, texas tiles, apparel, even food stuffs, foods, wines, things like that, almost everyone can be benefitted from this. >> peter, do they exist because they are relic from the past or are the tariffs new and recent.

>> i think all of us wanted to reduce our tariffs in the context of the negotiations where we can do so multilaterally. that's not going to work. i don't think the u.s. or the eu would increase tariffs but if we reduce them between us it will provide additional stimulus for growth which is important both for the united states and europe. right now as we're looking for new sources of demand. >> and peter are your actually able to take the european crisis and perhaps use to it your advantage from a policy point ever view to say look if you want to increase business to europe, trade to europe a good way to do so is to eliminate these tariffs and other measures. >> absolutely. including in the regulatory area. there's a lot we need to do in that area and we've been spending a lot of time with industry and regulators trying to find ways to bring our regulatory systems more closely together. >> what about the other areas of concern intellectual property.

it would seem that for some of these there's a ways to go before we can get to some sort of common global regulatory regime. >> i would say that a lot of these things are domestic regulations that affect the investors there, including american investors in europe and european investors here. american firms have put something like $2 trillion. those domestic regulations, they are fine. they are the operating environment companies work in. but there are other things where regulation comes up like in the financial services area where maybe unintentionally we create frictions between our economies and stymie growth in a way we don't need to. what we're trying to do with the chamber work with our numbers both european and american is to

find ways to bring these two regulatory regimes together so that savings can be circulated, can be invested and produce growth and i think particularly now when our government deficits are high and governments are trying to reduce their spending or their deficits and when structural reforms will take a long time to actually show results, now is a time to look for how do we build additional demand and negotiating now a very strong high level agreement between u.s. and europe would be good for both of us. >> how are those financial frictions increase in light of europe's debt crisis? >> that hasn't been the source -- there's not a direct relationship between the debt crisis and the financial regulation and frictions in general, i would say. i think the differences in

regulations came from the initial financial crisis where people say, said we need to regulate more, we need to regulate better, we need to do it quickly. both side worked quickly without consulting each other and that's created some differences. there's some specific things related to the debt cry circumstance maybe credit rating agencies where the europeans want to take some regulatory moves that go further than they need to. the debt crisis per se is more a question of european governments needing to access money on markets and needing to convince investors that they will be repaid. >> again, that was peter chase from the u.s. chamber of commerce. lynn, i'm curious about your thoughts. how difficult has it become just as a strategist looking at investment opportunities to get past the risk of more regulation of anti-competitive measures as europe's debt crisis deepen? >> it has played a role in

banking. there's been a general retracement in cross border flows. this has added to volatility which has made -- has made trading much more difficult. as you've seen, particularly in europe each country cash flow, cash flow home in the bond markets and it has made finding winning trades or good trades much more difficult. >> all right. some other corporate news. fund managers plan to take control of jjb sports. >> the ceo of iag confirmed its group could buy minority stake in american airlines. willie walsh expressed his support for a merger and for american to remain within the

one world alliance. american's parent company filed for bankruptcy last november. >> world dutch shell is pulling funds from european banks. suggest the move is in response to fears over the region's debt crisis. the company's financial officer is credited with saying they want to deposit cash in non-european deposits >> it's are regulators may drop their investigation into silver prices. >> a lot of volatility from then until now. give us your own view now of how you trade these eurozone debt? >> i think in a very short term,

still have to get worse before it gets better. until spain is forced into that bailout. i think long bunds in this current environment is a good position. take a risky engineer type of trade, short end of spanish and italian debt is also something that's likely to come in further on the threat of ecb -- >> talking about buying the short end. it has. aggressive bid at the front end. that's likely to continue if you're going to see some normalization, if the curves in those countries. in anticipation of that action you could go there or if you're very confident, maybe go to two to three years. have to move out. >> with these countries being, especially in spain's case and recession, shouldn't that imply a flatter yield curve? >> yes it should but still it's kind of very, very steep or what

has been very steep at the front and going flat, great worry about currency or debt market of the country. you still expect for enamelization process steepening first. >> you're still long german bunds. we heard from a number of high-profile people saying the trade of the decade is to short german bunds. >> personally bund puts and option trades were effectively you can gort germany but it's that gap where it's going to get worse before it gets better and you could get cut of our trading position in the next month two. great trading opportunity just how long you can hold on. >> swaps in trades? >> yes. >> sub 1% on the ten year, this year, do you think for germany? >> i think we'll still struggle to get there but definitely go back to the historic loss. >> sub one on treasury, sub one on bunds.

>> you want to take the other side of that? >> or let ross's call on that stand. >> great to have you on. thank you so much. just reminder you what's on the jenn. tomorrow japan's center bank will report. get earnings out from bridgestone, mgm china. >> well get a view from the u.s. coming up next.

>> welcome to "worldwide exchange." i'm if you're just tuning in i'm kelly evans. >> i'm ross westgate. >> knight capital gets thrown a lifeline. the firm has sealed a deal for injection of new capital may come at a pretty big cost to shareholders. >> new search for life on mars begins as nasa successfully lands its curiosity recover on the surface of the red planet.

okay. let's see how trade is set to kick off this week after what was a strong day on wall street on friday and a strong session in asia overnight. the dow jones industrials average is pointed higher by 22 points. the nasdaq implied to open higher by 11 and s&p 500 by four or five points as well. take a look what's been happening overnight the cnbc ftse global 300 up 13 points. largely driven by positive action in asia which is keying off the positive mood we kwloesd on friday. european forces the picture here positive not as strong. ftse 100 is up .13%. xetra dax is heading a third of a percent. here in spain ibex 35 is higher by a quarter of a percent.

>> all-important yields that continue to keep a focus on that. let's show you where we stand. ten year yields just below 6.8%. italian yields just below the 6% mark. we'll keep our eyes on this as we go through this month. spain probably doesn't need anything in terms of official money, it can get through october. nor auctions planned in spain until september. so in that sense there's a bit of time, bit of breathing room. treasuries yielding 1.55. the high on the yield posted is around 1.592%. so we have come back down. currency markets, euro hit 1.2244 which is a new high. right now mere at 1 pipe 2363. recent low was 1.2040. rela lively recent low. aussie/dollar still up the five month highs.

that's where we stands right now. european trading, what happened in asia overnight, joining us more, we go to singapore. asian markets are in the green helped by friday's leap out of the u.s. and europe. talk of more policy fine tuning from the people's bank of china over the weekend had an impact. the shanghai composite added 1%. it took off on news that over-the-counter trials are expanding to four new cities but volumes were ahead of key economic data due out on thursday and friday. there's also a lot of uncertainty around the country's once in a decade leadership transition. chong the hang sang reached that 20,000 mark for the first time since may. blue chips have helped to support the market. also nice rally out of japan higher by 2% thanks to that upbeat u.s. jobs data and weaker yen. automakers climbed after toyota

posted its highest quarterly net profit in four years. the kospi gained 2% to close the week at a seven week high helped by ship builders and exporters. the aussie market valued on rising commodity price up by more than 1% with material stocks and energy companies leading gains. lastly india the country's retail sector outlook was revised to negative but that hasn't slowed the sensex trading up by 1.3% at the moment. back over to you. >> okay. thanks very much indeed for that. united states has joined us after an amazing weekend of sports. >> you can tell by ross's hoarse voice. >> wasn't supposed to speak much over the weekend but it was hard not cheer. >> you were cheering at the top of your lungs. let's bring you a quick news update as we follow tropical

storm ernesto. this is moving through the caribbean and expected to strengthen as it heads towards mexico and mexico issuing hurricane watch for that tropical storm. also knight capital has reportedly reached a deal with a grouch investors for an infusion of $400 million in capital. cnbc first reported the deal and it's supposed to be in the form a convertible security that gives buyers a right to get knight shares at $1.50 a piece. jeffrey, blackstone and td america. it will allow knight to open for business today after taking a crippling $440 millions last week following its massive trading glitch. it will, those dilute the company's existing shareholders. knight closed at just over $4 a share on friday. coming up later will the supportive lifeline help. we'll speak with the author of

"automate this." u.s. markets got a boost from better than expected jobs report on friday and goldman sachs saying now the latest run of data out of the states has reinforced the view the u.s. will grow modestly this year. the chief economist cites the improving housing recovery, pick up in real disposable income and easing in credit conditions. still, the fed will go ahead with mormon tear easing, that's because of down side risks from the fiscal cliff and european crisis. joining us for more is andrew wilkinson. what is your view on the u.s. economy. are we turning a corner, are things starting to look up? >> well, i wouldn't necessarily say that we're turning a corner. we've definitely felt the incredible angst going on in the

yurd. a year ago we felt some comfort when the economy was feeling the backlash of what was happening in eurozone we didn't have a big decline in economic output in both china and the united states. it felt at the time we could weather the storm and there was sufficient domestic demand told things up. now we've gone from 3% pace of growth to about 1.5% pace of growth and seem very reliant on what the fed needs to do. >> should we be rethinking the business model or business cycle entirely and get used to this idea that it's basically fiscal, monetary support keeping growth above water but shouldn't expect much more than that. >> well, right. i mean we've got the so-called fiscal cliff coming up at the end the year. the estimated shock from that, if we were to fall off the cliff, if, you know, tax codes were not renewed is estimated to

be around between 1% and 5%. that's a huge amount but the reality is we probably won't, you know, run into that problem. some fix will probably take place. on the monetary side, i'm still a big believer in what the federal reserve is able to do through expanding its balance sheet and i think a lot of people are sitting back looking at whether the fed's actions will impact the real economy and, of course, there is a limit to what they can do. they can't fix the, you know, the european political situation, but in conjunction with effort from the ecb i would suggest we can weather this storm. >> in that sense was the employment report for the markets a good result in the sense they were stronger than expected but does nothing to change expectations for the fed doing something in september? >> yes. that's a really good point and it's right on the nose.

you know, when you look back at the data, there were three significant sectors, leisure, health care, education and business and professional service which account for around 40% of all jobs and those three sectors saw hiring above the second quarter to pace. that was a good result. but then you look at retail and transportation and they were well below the second quarter pace on average. so, you know, it was rather a mixed report in that sense but when you look at the household survey, you know, there was a loss of 195,000 people employed across the economy in the month of july and that's substantial. it hit the sweet spot in terms of allowing the fed to, you know, get through the jackson hole meeting at the end of this month which central banks meet and discuss potential action. probably force them to deliver something in september. you know, the economy growing at an average payroll gain of

105,000 is barely treading water. and, we really need to do something to boost domestic demand at this point. expanding the fed's balance sheet would do that. >> we were just looking at the timeline reminded this week we're approaching what someone called the five year anniversary of the financial crisis. how far are we through that whole period, through this whole event do you think? >> that's incredibly difficult to say. we're at the point where we're revisiting the crisis. if you look back at what china did four, five years ago in response to the crisis, you know, the unraveling of the mess from the construction bust in the united states, their response was to come and build more, throw more money at construction spending and, you know, it really worked but that policy stimulus is essentially a one off. how far throughout the entire timeline is very difficult to

say. the world economy has changed massively in the interim. and, you know, i tend to agree with words to of marvin king over at the bank of england he keeps saying we're only about halfway through this. it's impossible to say. >> andrew, good to have you on. following an eight month journey nasa's curiosity recover has landed on mars. the one time craft hanging by ropes from a rocket backpack touched down exactly on schedule just after 7:30 ct this morning. the robot will spend two years on the surface of the red planet looking for evidence of microbial life. as men already come from mars we know what kind of intelligence is already there. >> it prompted us to ask whether the mars sproeb a good use of u.s. taxpayer money. we already know that nasa and other space programs have come under funding pressure.

what about the expedition to mars. ross you mentioned you can following that recover on twitter too. >> yes, you can indeed. i just got to remember the -- >> we'll look it up. we'll get the. >> @marscuriosity. i'll confirm. still to come, it may no longer be a question of whether but how spain's finance minister says he'll not be asking for a bailout just yet but they seem to be quibbling about the price. we'll be live in madrid when we come back. tion 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. ♪

welcome back to the program. these are your headlines. european stocks trading higher this morning on the back of strong u.s. jobs report. >> knight capital gets thrown a lifeline. they will get a capital injection but at a high price for shareholders. >> nasa successfully lands its curiosity recover on the surface of the red planet. still a little bit news out of syria. syrian press has been sacked according to syrian television

reporting this morning. >> just also want to mention that spain's be stock exchange trading has been halted on a technical glitch this according to dow jones. >> talking about spain, apparently they will not be asking for a bail out until there's greater clarity on conditions that's attached to a potential rescue. the financial minister said spain is no rush to request aid. it's significant we've moved on from not quibbling about whether we will or won't have a bailout but quibbling about what the price might be? >> reporter: certainly a sea change in terms of the rhetoric we've heard from policymakers here. i said the bail out would only be about the financial sector no, thing broader. to hear now both the economy minister and prime minister

suggest that perhaps they need to look at the options and then assess the situation is definitely a sea change and we can't ignore that fact. if they do ask for assistance we don't know whether it will actually mean more austerity. doesn't even necessarily have to mean about the economics. it comes down the politics and saying to the people i promise it will only be for the financial sector. one of the other things that came out from that interview is they are looking to approve a law to develop a bad bank and around a quarter of the 100 billion financial assistance could go into that. the rest being used to recapitalize the banks. we're talking about 180 to 200 billion jours of problematic assets. how do you get the valuations right. we can look at the estimates that come out. it gives you and idea of the scale of the job to do in order to value those in order to make

a bad bank situation work. what we also had on friday too was some of these problematic banks could actually ask for recapitalization funds as early as this week. we'll don't watch out for news on that front too. for now, back to you. >> thanks for that. it looks sunny and busy in madrid. andrew wilkinson is still with us. andrew, it likes we might of a pause, i hesitate to say this, a pause for the rest of the summer, what do you think? >> yeah, i think it's extremely smart. i sat through the press conference last week on thursday and i was -- i was surprised at the market's reaction. everybody in the room with mario draghi was telling him the market was reacting badly to what he said and i didn't get that. then on friday, you know, the

yield kept starting to move in the right direction. what we need out of the european markets is to get the short term yields down. i'm talking about the two year. this is exactly what draghi is talking about doing. so, yeah, i would agree that he could have pulled it off. if he can get the two year yields down it will filter through in terms of confidence. you'll attract bond buying and the ten year will come down as well. once you get out of that, that glacial gaze where investors are just sitting there like rabbits looking into the head lamps i think you can make some real economic progress. you got to remember all the european gauges, manufacturing gauges not so much the service sector gauges, everything is at lower ebb, business confidence is down. the situation is ripe for that

confidence to show itself up as an increase in output going forward. >> all right. andrew, stick around. still to come the olympics is set to bring billions of dollars of advertisement. find out what other event will be a bigger draw for the industry. >> that's coming up next.

okay. plenty of action in the olympics. great, just super saturday was amazing. >> the tennis i still can't get over. >> amazing weekend of action. tennis final of the tournament was a repeat of latino month's wimbledon. andy murray came up against roger federer. he stormed in a commanding lead and became the first british man to win olympics singles gold since the first time london held the olympics back in 1908. >> redemption from that lost to federer a month ago. final men's 100 meter saw usain bolt reclaim the title. he won gold also with an olympic record time, teammate yohan blake took silver. >> china tops the overall medal

board. great britain jumped up into third place, 16 gold medals. three below beijing. >> that's third place by quite a margin i would add. you got some work to do. >> if you did the gold medals per gdp or gold medals -- >> per capita. >> we did per capita on china we would be about 100 -- >> your gold medal take per capita you're probably leading that one. i'll give you that one. >> not just athletes winning one, the summer games provides one of the biggest boost to the advertising industry. this year's giants good have $6 billion and $8 billion in advertising sponsorship. i caught up with the boss of advertising and asked him if like big sports like the

olympics and the european fifa tournament would have a meaningful impact. >> every year we look at this closely. we have the maxi and then the mini, the mid-term congressials. it tends to pull money from other budgets. the political event which this year because of the supreme court decision and the mid-terms it had such a big impact. $7 to $8 billion will be spent on the elections over two years. when you think of the american media market is $400 billion you're talking about a 1% to 2% impact. the answer to your question is it does have an impact. the impact of the olympics this year has been more muted than we thought it was going to be. but you got to remember that

when we put in the bid we said 750 million but they've done better than that. not just now it's been going for two years, you could argue even longer. basically the sponsorship vehicle and the promotional vehicle that the olympics provides is extremely powerful and somebody asked me and said something about guerilla marketing. companies are putting in $50, $60 billion. so these are very, very big investments and they have to be protect. >> alex joins us now. quite startling. it's interesting do you agree with what he was saying the

european football championship and the olympics they pull money elsewhere. the big difference is u.s. elections. >> it is on the u.s. media market. closer to home here in the uk, the bbc is showing olympics. >> what is the commercial benefit from the olympics? >> the commercial benefit occurs from the sponsor, i won't name names but we know who they are redeploying their money into tuck around the olympics and placing more money this year than next year. more of a phasing benefit. >> are they going to get -- this is being, you know, generating such enormous interest and kelly has been traveling around. there seems to be a, this is a fantastically well supported olympics as good if not better than sidney in 2000 and fantastic filter. does that feedback into the

sponsors? can they tap into that? >> they should be able to. i heard before the break one of your other guests talking about consumer confidence at an ebb. if this doesn't do something for the uk consumer confidence nothing well. so, big chocolate companies, big drink companies will latch on to this. >> you can't get any olympic venue you've been to -- the best thing was those little -- >> the mascot? >> know the treat shops. >> should we expect a lot of these companies to incorporate the olympics in their message. >> very much so. the olympics message, the olympics motto is about inspiration, feeling proud, aspirational objectives which everybody wants to tap into. i would say the legacy of the olympics in terms of the advertising impact is a lasting

impact but you might not see some of the benefits until next year or the year after. >> it flows more to the print side, print media than to television where the rights are held by bbc which doesn't air advertising. >> that's exactly right. the daily mail, 2 million circulation, mid-england favorite is doing very well out of the olympics for example. but no. >> what's interesting all the print done every day it's olympic souvenir rap and there's nothing -- you know you still want -- the thing is i find this. i watched the olympics live. i watch the highlights and then in the morning i pick up the papers and read about it. i can get enough which is why my voice is going. >> across every platform and that's probably unique to these games because some of the technology just wasn't around four years ago. >> the election coverage? >> u.s. broadcasters will do incredibly well. somebody close home to will do

very well. in general the agencies that tap into the inflation you see in terms of media pricing that will be a big feature. >> good to see you always. alex degroote from panmure gordon. we have some syria -- we got temporary caretaker taking over as prime minister in syria. omar ghalawanji. prime minister sacked. following rumors on where his whereabouts are. >> state tv said he had been sacked. >> not defecting. we'll chase that to the extent we can. >> still to come, the latest on the knight capital trading if i as do, libor investigation and a preview of the market open on wall street. >> don't go anywhere.

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. welcome back to "worldwide exchange." i'm kelly evans. >> i'm ross westgate. these are your headlines from around the world. >> knight capital gets thrown a life line, reports say the troubled trading firm seals a deal for injection for new capital but at a steep cost for shareholders. >> european stocks hold on to gains as the u.s. continues their job boost. >> search for life on mars as nasa successfully lands its curiosity recover on the surface

of the red planet. o >> it's green on the board. u.s. continues the gains. asia overnight also. muted compared with what we sautin lats trading session. dow jones average is pointed by 22 points. nasdaq higher by 11 or 12. s&p 500 trying to add four or five pounts. take a look on what's happening on the global front as we hand over to the u.s. cnbc ftse global 300 was up .3%. towards the european boards the ftse 100 in london is just barely higher now, xetra dax looking stronger. cac 40 up. ibex 35rks this is the one focus

on up a .25%. trading halted amid a technical glitch. kelly thanks. lots of experts have been on cnbc today talking about what investors should be doing. this is just a recap of some of those thoughts. >> i do think that the aussie would be a better, a better sell against the yen. and against the canadian right now than against the u.s. dollar. >> if spain does look like it's on a path to ask for the bailout then those fund maturities will improve and then you might see some investors coming back to the market. >> look at the big picture, ftse is stuck in this sub five to

6,000 range. risk is whipped around rather than out performing. it's quite tactical. if you're in there the rally the great. take a profit quickly. if not you have time to sit back and wade for the next pull back. >> all right. we saw those pictures in the headline. show those pictures, the celebrations. >> wow. they are so happy. look at that guy. >> let me tell you this is what's been going on in every house and office in be the uk after the weekend, right. this is exactly the same. >> i have to say bbc did show behind the scenes what it looked like as they were watching -- >> this is nasa. this is what's been going on throughout the uk. if you wonder what the spirit is like right now in britain it's just like this. >> that's what it sound like when you're on the streets after they win a medal. >> uk is an amazing place to be. just like that. >> fun to be over here.

>> knight capital has reached a deal with a group of investors for an infusion of $400 million in capital. cnbc first reported the deal and capital would be in the form of a convertible preferred security giving buyers the right to give knight shares $1 a piece. jeff friess led the offering. blackstone, td ameritrade. knight will open for business today after taking a potentially crippling $440 million loss following last week's major trading glitch. but it will also dilute the company's shareholders. >> the co-founder and co-ceo of aisle 50 and former tech writer. his new book is called "automate this." chris, a timely book here. thanks very much for joining us. how concerned should we be that these issues aren't specific to knight capital?

>> well, they certainly aren't specific to knight capital. i think what's most concerning is that if this can happen to knight it can happen to anybody. knight has been in the business for 15 years. they led the way in electronic trading and clearing. they handle probably half of all the retail orders in the united states and to say that if knight can let something like this go wild for 45 minutes, i don't know what we can expect of everybody else. >> does this mean no one should trade we should just tloup our hands. what are the practical implications then? do you expect any more regulatory measures on this front or will people evolve to go back to the old way of doing things? >> no. i think we should expect regulatory, something to happen in that realm just because we, this electronic revolution that we've seen in the last 15 years has been good for the average person, been good for the market.

but we passed that point of utility at this point. people can sit in their house and trade for $6. no big barer to getting your money into the market. that happened 10 years ago. the last ten years of owe vo lugs on markets where we have these very high-speed, high frequency traders controlling 60% to 70 puerto rico of the market you really have to question what the value is of getting faster and faster by microseconds. what's the value to the normal investor? what's the value to the companies that are trying raise capital on the markets which is the whole point. you got a company called spread networks run by some very smart people who dug a tunnel really a little pipe from new york to chicago without anybody knowing and now they can charge $3 million per little strand of fiber optic cable because they are the fastest path between those two financial markets by a mere four milliseconds. $3 million for four milliseconds. it's incredible.

>> chris, if this is down to new programming and presumably we'll never stop this happening because systems are always going new systems, always new programming code, it's a constant state of introduction into new innovation, isn't it? >> no. it's constant. the thing about it is when you're a good developer and good programmer, you do two things. first you test your code. you run it in a stable environment that very closely mimics reality. usually called the staging environment. and trading companies, web development firms whoever they are will put their code into a staging environment and watch it. when it breaks they will go back in and fix it and won't release it until they know it's very, very stable. web companies will sometimes throw a code out that's not completely finished but they can get away with it right. high frequency trading firms like knight would test the heck out of any piece of code they

put out there. in addition to the fact another thing programmers do is they write tests in tandem with their code that show if the test returns one false it usually shuts down the code. in which case for knight would shut down the trading. so apparently they just didn't have the right tests which to me is incredible and this took 45 minutes to shut down, i just can't imagine what was going on over there because this is something that a web firm, a start up with ten employees, would you think they would have shut down. >> kill it before they kill the market. do you agree? >> i don't totally agree. the quads and the physicists have done a lot of good. you have to draw the line somewhere. if this can happen to knight this can happen to anybody.

>> chris steiner. >> a glitch on spain. >> literally had some sort of technical issue. >> began at 10:35 cet, should have just started. chris, we have had another spanish stock exchange glitch this morning. these happen all the time. stock exchanges all the time are having glitches. >> no, they are. you know, people are calling what happened at knight a glitch. and a glitch can lose $500 million is a bit crazy. a glitch is usually something that happens for three seconds. we had a firm here in chicago called infinium capital and had a glitch and turned it off after three seconds. they put out bad code. i want lost the firm a million dollars in three seconds. this code was losing $10 million a minute and knight again is the most practiced hand in the business. you wouldn't expect to see that. there's so many things that are

piled on top of each other in these markets you can't predict how they will behave. >> how long does it take you to realize? 45 minutes. chris, good to see you this morning. thanks very much indeed. you know what i mean. you've run the bath, the water is pouring in through the ceiling. >> right. how long does it take. >> he's suggesting it took them a long time to realize water was pouring through the ceiling. >> absolutely. we'll come right back. before we head to break. we want to recap a dutch auction. the netherlands has sold three month treasury certificates with a negative yield 0.051%, seven month with a negative 0.02%. 3 billion euro auction with negative yields. still to come on the program will wall street be able to extend the strong jobs report

rally or will stocks wilt in the summer heat. we'll preview the trading day. [ 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. ♪

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landed on mars. the robot will spend two years on the surface of the red planet looking for evidence of microbial life. earlier we asked if the probe was a good use of taxpayer funds. brian tweeted in to say curiosity budget is worth it if nasa discovers a eurozone recovery plan. odds better than european leaders finding one in the next summit. dan adds unless there's shovel ready jobs on mars just add this money to the other wasted failures like solyndra. tweet us at cnbcwex.com or reach us directly at @kelly_evans or @rosswestgate. or you can follow the rover itself on twitter. that one is at marscuriosity. also been just over a year since s&p downgraded the u.s. taking away it's aaa rating. u.s. treasury secretary tim quite called the downgrade at

the time a terrible judgment call. >> i think s&p has shown really terrible judgment and they've handled itself very poorly and showed a stunning lack of knowledge about fiscal math. they drew the wrong conclusion. they like many people looked at this terrible debate we've had over the past three months should the u.s. default or not. remarkable thing for a country like the united states. >> how far we've come since then or how far we haven't. >> well, how far we've come in yields but not in the way that you might expect, kelly. let's show you this. this chart over here is kind of interesting, we'll bring you over to this. only twice in the last year since we've had that downgrade have yields been higher than the level they were at when the downgrade was initiated a year ago, over the 2.3%. we speck up just before november last year. here in march as well. but from around 2.3%, yields are

going 1.5459. we hit that post-jobs yield. a couple of weeks ago we hit the record low on treasuries of 1.38%. so what did the s&p downgrade mean for u.s. ten year treasury yields? absolutely nothing. but nevertheless not many countries in the world have a aaa rating just a reminder of some of them. they went negative in the eurozone ratings. spain is the one of course that's been most affected. the countries that still have their aaa rating that's worth taking a look at. so maybe we can do that. take a look at the credit rating in the eurozone stands. have we got the next wall? it's over here. this is the wall i wanted. over on this side. uk, norway, singapore, hong kong, we got luxemburg, norway,

canada, germany, finland and of course australia all getting a bit of a boost from being aaa, kelly, interesting list. >> what's the one with the flower there in the middle? >> i think that's hong kong and i think that's singapore. i hope i have it right. >> i have some homework to do. still with us is andrew wilkinson. andrew, do credit ratings matter? >> absolutely not. no. as ross pointed occupant those two spikes in u.s. yields have nothing do with -- they had everything to do with economic fundamentals. they didn't have anything to go the fear that the credit ratings of the u.s. were under threat. so, when yields spike back up to what 2.39% back in march that was with investors believing that the u.s. economy was recovering and the fed was a step closer to raising interest rates which couldn't be further from the truth at this point. >> andrew, stay with us for

more. if you're just joining us, a reminders these your headlines. european stocks hold on to gains this morning on the back of a strong u.s. jobs report. knight capital gets thrown a life line. reports say the troubled trading firm will get a capital injection but at a high price to shareholders. nasa successfully lands its curiosity recover on the surface of the red planet. >

so what should we expect out of the stock market this week. joining us now is managing director of spectra asset management. do we pick up from the strong note of last week? >> in u.s. the equity markets look rather positive as a lot of

speculation, these cops getting exhausted. on the equity side we're seeing a consistent bull move and the other lower. >> it is the jobs report, some resolution in terms of what the exis doing? -- ecb is doing? >> i think budget concerns here or just repatriation of anything, the u.s. economy has been struggling and that's the big quandry. >> andrew do you agree? >> more to do with the ecb and eurozone economic activity. it's great to see the s&p earnings, profits are beating expectations by 4%, revenues are

on the upside. again, that's based largely upon the premise that the fed continues to add stimulus which i expect in september. forward looking, much of the eurozone's problems may have been taken care of by draghi's actions last week but looks positive at this point. >> brent up over 108. if we get morphed stimulus will gold weaken. will other commodities get more of a boost. >> on the metal side it would have to do that but we're starting to see assimilation. gold at 1600 looks tired which to me is just opposite of what you mentioned. right now not very bullish on the metal side. >> mike despite people saying at

this point we priced in a lot of the bad news. it get easier to beat expectations from here? >> again, it's all about athletics at this point. that's why pricing and any bad news can get worse. you're inside 100 days still on that. the uncertainty alone is one of the reasons why you're starting to see demand dry up in the metals market and why s&p looks bullish. >> good point. and andrew wilkinson chief economist strategist. >> mike wishes he was here in london this week. >> that's just about it. coming up next "squawk box." for kelly and i, be safe. i switch now into olympic watching mode. >> go team gb. >> wherever you are, have a

golden day.

good morning. saving knight capital, the trading firm set to enter into a $4 million financing deal. >> euro fears on the spanish ten year holding close to 7% danger levels. plus summer sizzlers. it's monday, august 6, 2012. "squawk box" begins right now. >> let's get ready to rumble. ♪ >> good rn