good morning. you're watching "worldwide exchange." i'm ross westgate. manufacturing giants are slowing down. the lowest level in a year and a half. stocks tumble, anti-government protests spread to cities around the country on a third day of violence. a new report by global central bank watchdog group says the

markets are under a qe spell with investors ignoring bad economic news. volatility and potential lawsuits. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. all right. let's bring you back to where we are with eurozone pmis. good morning to you. first "worldwide exchange" of the week. eurozone pmi is 48.3, better than expected for the month of may and april. there are 46.7. 46.8 is what we were expecting. we saw better numbers from spain, italy, germany getting near stabilization, as well, as steve was saying on "squawk box." 1.3027. so, yeah, but we are still down heavy, 22 months of contraction, of course, italy. and there's a difference between having a weak er contraction or

slightly less contraction that is than expansion, of course. bad news, as well, from china's factory floors. hsbc's pmi reading down to 49.2. it compares with 49.6. it marks the first contraction in seven months. frederick neuman says there's good reason to be concerned. >> we are getting increasingly worried. number ves disappointed, not just in china, but throughout the asia pacific over the last couple of months. it's not just the slowdown in exports, we see some weakness in domestic demand coming through, as well. >> hsbc's pmi was weaker compared to china's official reading over the weekend. tough to assess the stress of china's economy given the mixed reading. joining us from hong kong, the chief economist at rbs will be with us in a few moments in

time. let's run through those pmis for you, as well. the pmi for germany was still sub-50, but it does improve a similar story in france, as well. pmi for spain and itly also rising this morning. we did see -- take a look at new orders, interesting to look at on the same vain this morning. we have the highest gauge since february 2012, first time since the down turn eased in four months. back to the china number, what do you make of the difference between the official pmi, 50.8 going up and the china hsbc number, which is slightly contractionary? >> one of the things that is worrying us a little bit both in terms of trying to make sense of it also because it doubly indicates that not all is well. i do think that the official pmi

numbers do indicate that there is some strength tat least in china's own economy. but the weaker hsbc numbers do point to continued weakness. it's not fully convincing, the recovery, the growth story. and i think especially on the export front things are still quite weak. >> what is the take away in terms of them doing to your growth numbers list? >> well, at the moment, as we are waiting for the data that will come out next weekend, i think i am at the moment not yet revising my forecast. i will probably do that in a week time. i hope that i'll be revising it upwards, but i mate end up revising it down from the already slightly subdued number 7.8% that we have for t growth for this year. >> you say the official pmi is not adjusted for seasonal patterns, as well. does this increase in may mean we're going to get a big pick up in manufacturing?

>> well, indeed. the official pmi numbers are not fully adjusted for seasonal patterns. usuallily the may numbers are not as good as the april numbers. that means what we've got over the weekend is good news in the sense that it does suggest there was a reasonal pick up in growth for the industrial sector as a whole. i think there is still quite a bit of weakness, for instance, in sectors like the steal industry and exports are subdued, but i think there are some signs of some strength of the domestic side. >> yeah, okay. wa do policymakers going to do? are they going to do nothing at the moment? they've got to balance between getting the right domestic demand and some of the breaks that they've put on on lending. >> i think they are in a little bit of a waiting period. they have stimulated the economy. a lot of money has been pumped

in. we are at the moment overseeing a period of growth, but not very impressive growth. there are not strong signs of a deterioration in the growth picture. therefore, i think at the moment they'll take a wait and see attitude and maybe next weekend they will tell us more about that. >> yeah, what will you be looking for in particular out of that data? >> i would hope to see that the export numbers look good and even when we adjust those export numbers for some of the irregular layerties that we have, i hope to see more growth. in general, i hope to see decent activity numbers. i hope to see some of the downward pressure on output prices are being mitigated so that profit margins are start to go improve. so in general, i hope to see some decent growth in the real economy.

>> keep it in focus with the export numbers. certainly what's going on is we want to see whether we can actually pick up the domestic flack and that rebalancing the economy. >> yeah. well, as i said, i am not as negative about the domestic size as many other people. the way i look at this data is ir do see domestic demand having held up better than demand in the first part of 2013. so i'm less concerned about domestic trends than some people are. i hope the external weakness is not going to filter through, to carrie over on the domestic side. but i'm a little less concerned about the domestic side. >> thanks very much, indeed, for that. >> of course. >> senior economist at rbs. >> kicking off today's global market reports with a look at

istanbul. the bist 100 is down 5.3% starting to state down 6.4%. turkish lira weakening, as well, against the dollar. 1.8786 on friday. 1.8890 is where we stand at the moment. as far as the turkish bonds with concerned, yields rising as you can see up to 3.84%, so up to 7%. now, anti-government demonstrations continued in turkey. in istanbul, protesters built barricades near the prime minister's office before police responded with water cannons and tear gas. protests began on friday sparked by plans to build a shopping center on a public park. at the same time, turkish people held protest toes show solidarity with the demonstrators back home.

heavy police presence in berlin as the rally mostly took place outside the turkish embassy. away from turkey, european equity ves started the weak down following falls at the end of last week and in japan again overnight. the ftse 100 down 0. 75%. the xetra dax down 1%. cac 40 down 1.2%. the ftse mib off 0.7%. we'll show you the yield in the uk, 277027%. ten-year treasury yields, 2.15%. we continue to see yields nudging a bit higher and ten-year italian yields, 4.18 pefs. spain this week, two, three and ten-year issues, we'll keep our eye owes. currency markets, the euro/dollar tipping up after that better than expected. 1.3040 is where we stand. dollar/yen, we're on the 1100 mark at the moment.

we'll keep our eyes on that. aussie dollar, 0.9638 is where we're at. the aussie recovering from deep losses last month. we have been down, of course, to that 96 level. sterling/dollar, a little firm, as well, at 1.5268. that's where we stand right now in europe. chloe has the update for us in asia today out of singapore. hi, chloe. >> hey, good morning to you. you know, quite a bit of losses that we see here in asia. remember, all seemed calm and quiet until the sell-off september accelerating over in japan. heavy futures selling. traders were responding even quite a bit of selling into nikkei futures over in london and new york, as well. and bis, dollar/yen coming in below 1100, so keep an eye on that, as well. as part of the losses emanated from that negative data that we got out of china, the divergence

between the official and hsbc final print, it was the flash china pmi that accelerated that heavy sell-off. remember that syndromeoff we saw more than a week act. the idea is this. some suggest that the china might be on a shaky economic footing and so, perhaps, the larger companies related to the official number, they at least benefit from state-led investment while on the other hand the smaller companies are getting cramped out of what's becoming a depressed economic environment due to sluggish demand at home and abroad. some fresh data crossing the wires, china's home prices for 100 largest cities continues to tick higher. for the 12th straight month, this might be a negative. earlier on, that might be a modest rebound. even as suggestions emerge that there might be a rate cut on the horizon by given the property sector. that could certainly be a negative when the markets open

tomorrow. overall, you can see how this notion about rotation going on, investors switching out of dividend plays and getting into more of the cyclical stocks as investors prepare ford tapering, that seems to be happening right across the board. take a look at the philippine composite at record highs, selling off sharply, as well, 3.7%. the kospi down. and tomorrow we have an rba meeting. it seems to be a nonevent and investors are focusing on the weak environment. the volatility in japan, the asx selling down 0.8%. we have nikkei options and futures expiring in the middle of june, june 14th. and some suggest that the sell-off here is no longer a fundamental story. it's more about how to position yourself because of the heavy focus on derivatives trade and that -- and this kind of swing, the wild swings that we see in japan could last until then. back to you. >> thanks for that, chloe. catch you a little bit later. as we've seen meanwhile in turkey, the stock exchange and

the lira down sharply as anti-government protests continue. zach cayman is joining us. thanks very much indeed for joining us. we are starting to see this now spill over into the financial market, as well. how much pressure is now on the government? >> istanbul is very important global city. it seems a bit becoming much more -- in terms of reaction to the prime minister and the government itself. and something that was peaceful,

nonviolent demonstration to maintain the -- turned out to be a widespread reaction against the prime minister. today is the seventh day that has been reaction and i think it is something serious to be in istanbul. >> yeah. look, how explosive is turkey right now, as well, to foreign lenders? turkish lenders seem to be more exposed now from 18% to 14%. is this an area where investors will be more concerned? because we have seen generally money coming out of emerging markets, although turkey is now clearly investment grade.

>> of course, turkey has been doing quite good economically. but if the government doesn't govern the situation well, it so far has been a bad government association and the image -- to turkey's global reputation, global media, publicly, you have pictures of the -- and this continues with ta government association continues, of course, you know, the economics turkey might be separate from

institution. it is absolutely important, especially for the government to deal with the situation quietly and turn the association into a kind of deliberation based problem or a problem that can be sofltd through deliberation and hope. >> okay. thanks very much for that, fuat keyman, professor of international relations sabanci university. still to come also on today's program, one of asia's final frontiers, myanmar, is opening up for business. but is the company really ready to deal with outsiders? we'll bring you a special report in and around five minutes. at 10:30 cet, we'll take you to berlin where investors are

cozying up to the high tech investors. we'll focus on one man looking at the games market. total sales have forecast to rebound after a lackluster april, but can detroit based sales exceed japanese imports? we'll have the preview at 11 cet. and what's next in the eu/china solar panel spat? our guest at 10:45 is the vice president of the german company solar world. he says act now or china will drive his company out of business. we went out and asked people a simple question: how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need

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myanmar is hoping its first international gathering of leaders later this week when the economic forum in east asia gets under way. a report by the kinsey global institute said the company country is looking at quadrupling its. but there are many challenges to unlocking that growth. >> it's becoming one of the most talked about stories in 2012. one year on, the message is clear.

myanmar is open for business. ann and observers like the world bank kayshanka gives the government credit for its efforts. >> they've been cut away for such a long time. so there's a clear urgency wanting to catch up. the focus would be on implementation. the focus would be on how these reforms are implemented on the ground. but they are off to a good start. >> make no mistake, doing business in the formerly reclusive nation is still a challenge, as evidenced by kevin fisher who heads cranes and equipment asia. >> it's not, like, just get off the plane and we've got to work. you have to do all the legwork with all the departments, keep at it and at it and at it. and i think some people, they come here and thought the land of nikkei and honey is going to be a walk in the park. the gold rush, for example, but

it's not easy. >> and then there are the basics, lack of mobile connectivity and also the need to carry cash, lots of it. but change is on the way. the government has put up two telco licenses for tender, which would bring the total number of mobile operators to four. while the large and private bank kbz has teamed one visa to expand electronic payments in the country. but that road to reform will likely remain bumpy. >> this two or three years is not going to be easy. there will be challenges. and it will be key for the government to tackle these issues, to have a genuine policy of cancellation and making sure that the policies that the government introduced ultimately brings foreign capital, bring no expertise. >> some clouds may loom over myanmar's horizon, but the

growth potential is still promising with a population of 62 million people, a youthful workforce and a wealth of natural resources. myanmar is trying to make up for a lot of on lost time. 60 years, to be exact. that's an entire generation being closed off to the rest of the world. but with these sudden and recent reforms, it is now flavor of the day for frontier market investors. still, it is going to be a long climb ahead before this beautiful but backward country achieves its potential and investors achieve returns. martin soong, cnbc, yangon. >> we'll have more reports from myanmar. mean wile, under the spell of central bankers, the battle of international settlement says cheap money is pushing markets to record highs. in its quarterly review, theback says actions by central banksers have allowed indices to remain buoyant. but mario draghi says a recovery

of sorts is on the way for europe. monetary policy and demand from abroad will see the block achieve a gradual recovery in the second half of this we're. speaking at a conference in shanghai, draghi defended the bank's own t-bond buying program. speaking this weekend, the indianapolis fed president mariano says strictly capping inflation is a wrong approach to monetary policy. kocherlakota didn't offer much insight into whether the fed will begin tapering its bond buying program. we have comments out, he says he's describing extremist

elements. we'll keep more eyes on turkey as we go through the day and in the asset market, as well. the by-st 100 currently down 5.6%. a ban on smoking in certain public areas came into play in russia this weekend. the nonsmoking legislation will take effect in aer use's times as starbucks clamps down on smoking. the coffee chain is banning smoking within 25 feet of its store fronts in both the u.s. and canada. the new rule came into effect on saturday. so are more smoking bans a good thing? is the reach going too far? join the conversation here. today you can get in touch with us, e-mail, worldwide@cnbc.com, or tweet @cnbcwex or direct to me. still to come, still in contraction territory. manufacturing pmi for the uk should be expansionary. we'll find out by how much when

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uk's pmi is more than a full point higher than the consensus forecast. april's reading was originally below the 50 mark that divides growth from contraction. factory output contracted 0.3% in the first two months of 2013 and has been an issue with growth for much of the last year. signs that this sector is recovering, we'll have further wait for the bank of england's decision to wait and see. we've got mervyn king's last meeting this week. he has consistently voted for an expansion of qe by another 25 billion, although the majority of bank of england's monetary policy committee have voted against that. anyway, that's taken sterling to 1.5279. this survey suggests a broad based improvement driven by new orders, particularly from the domestic market. job creation was reported for the first time in four months. input cost inflation also easing.

we have seen a decline in commodity push innation, as well. so better news for the uk. meanwhile, the ftse down nearly 1%. the ftse mib down 0.75%. not helped out by the composite pmis we got, as well, this morning for the eurozone. at the same time, we were waiting for more news, as well, out of the uk on the latest funding for lending, as well. let's recap, though, the headlines. before that, stocks around the globe kicking off the month in the red as p mi shows asia's manufacturing giant are slowing down. hsbc for china lowest in a year and a half. the turkey lira is down heavily as anti-government protests spread around the

country following three days of violence. a new report by the global central bank watchdog group says markets are under a qe spell with investors ignoring bad dmk news and that's left stocks vulnerable to volatility and central losses. in turkey, anti-government demonstrations continuing as tens of thousands take to the streets last night. protesters built barricades before police responded with water cannons and tear gas. the protests began on friday, sparked by plans to build a shopping center on a public park. but have now broaden into anti-government protests across the country. the prime minister said this morning the turkish people must not be protested organized by what he calls streamest elements. the reaction from investors has meant the stock exchange in turkey lira have fallen sharply

today. the turkish lira weakened against the dollar towards an 18-month low. with more, we've joined by yusef. what are the risks for turkey? moody's recently upgraded them, gave them an investment grade status. they have tried to reduce their reliance on external funding, as well. >> absolutely, ross. it's a dramatic turn around the last two weeks. we have scattered reports of clashes. and the overall situation remains very tense. this standoff is far from over. and also, the response from the government that we've seen with a very heavy hand has, of course, sparked outcry around the world and criticism from the united states and the european union. you have to remember that the situation in turkey does not lend itself to this kind of turmoil and you bring up the moody's report. they just upgraded turkey to

investment grade, but that is unlikely to be sustained if this political turmoil, this political uncertainty keeps going. you're seeing the reaction on the stock market and with the currency, as well. this has serious implications on this emerging market. the sell-off started with the broader emerging market sell-off, 5.5% last weekend. now it's being exacerbated by this political risk which before wasn't really on the front or on the map 06 any opener or analyst, to be frank. at least the ones that i've spoken to. what does this mean for the political future of turkey? well, it complicates efforts for the prime minister to pass through a new constitution to make the ledgis i've been changes that he's been seeking to make. also, it makes life quite difficult for the central bank which has been, of course, grappling with volatility in the exchange rate. remember, the thing is about this emerging market is that the current account deficit is financed by foreign capital.

not just any foreign capital, ross. this is hot money and that means when it comes to political volatility, gets sucked out very, very quickly and that means, of course, bad news. we expect it to be very, very quickly if this situation continues. the key concern here is that the standoff in the square brings back memories of tahrir square in egypt, so nobody is really sure how long it's going to last, but one thing is clear. the longer it lasts, the more the damage to the market. >> all right. yusef, thanks for that. let's just bring you up to speed with the bank of glen's funding for lending scheme. wa we're seeing right now is the bank of england net lending on the scheme minus 0.3 billion in the first quarter of 2013. banks and buildings have drawn down around 16.5 billion from

the august launch. mr. fisher says the picture of flat lending growth overall as broadly as expected at this stage. mr. fisher says the plans of the participants suggest net lending volumes will kick up gradually through 2013. we've got a couple of individual breakdowns here. barclay's funding for lending, net lending 1.1 billion. rbs is a contractionary 1.6 billion as well as lloyd's and santander sls q1 net lending minus 2.3 billion. india's economic data continues to point to weaker growth this year, as well. the country's manufacturing pmi for the month of may was 50.1, the lowest reading in four years. and the first time in four years that we had it shrinking, as well. mean wile, the factory output index down to 48.6 because of weaker domestic orders. indonesia, mean wile, unexpectedly chalked up a 1.6

billion trade deficit in april, blame placed on the weaker commodity markets. they were down more than 9%. imports dropped 3.7% from a year ago. on a more upbeat note, the country's annual inflation was better than expected, ease the at 5.7% the rate in may. japan's prime minister shinzo abe says recent market volatility is temporary. he says some are unfamiliar with japan's bold economic policies and the situation would settle as the bank of japan continues with market dialogue participants. he's confident that his policies would help prop up japan's growth as recent improvements in gdp and consumer spending shows. abe is expected to his first policy era to continue competitiveness later this week. despite success of ache-nomics in boosting consumer spending, the latest data showed capital spending by japanese firms down nearly 4% in the first quarter,

this compared to a year ago, it's the second straight quarterly fall. and a small piece of tape appears to have grounded one of the most techlogically jets. there was a problem with the air pressure sensor. jal said there were no signs of abnormality. the issue appears to be a piece of tape that was not removed from the battery's container after the battery's testing. and an important thumbs up for softbank's bid for sprint nextel. makiko has the story for us from tokyo. >> hello, rots the. the vote of confidence came from isf, a advisory firm that advises investors on how to perform on corporate issues.

iss says it supports soft bank's bid for sprint and it described the price tag as fair and said it would give the u.s. mobile carrier the much needed capital to improve its network and become more competitive. the recommendation may influence institutional investors that own shares of sprint as the meeting is scheduled on june 12th. but iss does not offer a view on a higher counteroff by dish saying the bid is still in its preliminary stage. now, softbank won u.s. snashl security clearance for its offer last month and the focus is now on the on outcome of the shareholders meeting as well as the ruling by the federal communications commission. if approved, softbank would own 70% of sprint which would provide the heavily indebted carrier with $8 billion in new capital. softbank is set to issue a record setting $4 billion worth of retail bonds to raise funds for the sprint acquisition. the iss recommendation does not give softbank shares a boost and the stocks are up nearly 5%

today. that's all from the nikkei business report. back to you, ross. >> thanks for that. now, the high berlin tech conference is under way. one attenders hit the starter company which ames to generate two new businesses every year. in its latest announcement, apple has just received a multi million dollar injection. the manager describes himself as the ceo of fox and he joins us now from berlin. ian, thanks very much for joining us. you're an incubator business. you're focused on building and acquiring businesses in the fields of gain distribution. how would you describe where you want to take your model? >> not sure i understood the question correctly. would you please repeat? >> yeah. how big, how many do you want to get involved? >> yes. so basically, talking about hitfox, it's an incubator

focused only on game distribution start up. so far, we started three of them and now apple has just -- our start up focus on mobile games distribution just raised $30 million vc funding round from prime ventures. as incubator, we will both grow existing business globally so opening up in terms of cisco and in asia and then start about two new companies per year with hitfox. >> you look at the moment, you've got apple as the game's marketing platform. you've got add to games which is a perform marketing network for games, as well. and the hit fox games finder. what businesses are you going to launch? and what sort of -- what will define your criteria? what's your criteria for investment? >> yes. so basically, we are focused on businesses where we can support game publishers and so far, we

are focused on businesses all in the space of acquisition because there are now so many gaming companies out there and the market is still growing. but the bottleneck for everybody is how can we acquire new users and reasonable costs? and this is where all the three start ups we have now came in and the recent funding of applift demonstrates this is a good space and we make the right decision to enter this market when we started the company two years ago. >> wa do you take in terms of equity for offering your your support? >> i couldn't hear this question. >> when a firm backs your app, what sort of investment do you make? >> it's a bit the other way around. we don't work like the u.s. where teams come to the

incubator and basically get some support. with us, it's the other way around. we're a group of entrepreneurs and we start the companies, we give them the full funding they need to start and then sometimes the early employees of our previous companies become cofounders in the venture. or we look for outside cofounders and management to join the team sxp and so basically, in the very beginning of our we own 100% and we distribute shares to our cofounders. it's more the german style incubation that we do, which is also down by europe or other incubators like rocket internet. the german incubation model works a bit different there than what's known in the u.s. or maybe in uk. >> when you look, when you inventorily look at these firms, what will the exits by for these businesses? are you looking for -- do you want to float hitfox at some

point because off all these stakes in these businesses or will the individual businesses grow and you'll list them or sell them? >> if i understood the question right, then our strategy is rather that over the course of time, we will sell our start-up that we created. we will not sell the incubator at all opinion so we plan to run the incubator long-term. it's not to sell while on the road when there's the right time and we feel the start upalready, then we will sell individual start-ups that we created. >> sounds good. and jan, very quickly, you're an early stage pre-ipo investors the likes of linkedin and facebook, as well. what is the next phase of -- for social sites, for social commerce? >> so what we can see now with gaming, gaming is the half in

terms of the platform. and mobile is really rocking it at the moment. so there are companies in the mobile gaming space that didn't exist two years ago now doing about $2 million in revenue per day in the app store. so gaming is on the forefront of adapting to new platforms. that was also the case when facebook came in. what i expect to happen is that as a vertical, especially those related to commerce, will follow. and i think the big thing now to happen in technology is mobile is really coming and there are companies really generating substantial revenues as the example for apple is our portfolio company. >> all right. jan, thanks very much, indeed, for that. ceo of hitfox. we'll have more from the high conference witness as well. still to come on the program, russia is starbucks both implementing smoking bans. we'll talk about the tobacco

market in a few moments. also, as the trade route between russia and beijing, our next guest says it's time to get tough on china or it's driving eu companies out of business. i want to make things more secure. [ whirring ] [ dog barks ] i want to treat more dogs. ♪ our business needs more cases. [ male announcer ] where do you want to take your business? i need help selling art.

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a ban on smoking in russia in public has come into force over the weekend. you were just saying a moment to me ago off air russia is the world's second biggest tobacco market. what impact is this ban going to have? >> there's a number of different ways to look at it. it's the world's second largest tobacco country by volume. it's a population of about 50 million smokers. if you look at that in terms of male smokers, two out of every three men in russia smoke. clearly it's a serious health issue that the russian authorities want to address here. in terms of the package of measure that's they've introduced on saturday and will be introducing over the course of the next couple of years, we don't feel it's going to have a huge impact on volumes because of the type of measures that are rebalancing russia's smoking

legislation, bringing it up to speed with other more developed veteran markets. russia as a smoking market has been in decline over the last three to four years. you're looking at perhaps 1% volume year on year. and we expect that to be exacerbated slightly by these new smoking regulations. >> what is the evidence of smoking bans elsewhere in the west? of what impact they have? >> well, the interesting thing about what these measures in russia are is that they are, as you said, public smoking bans, they're centered on people's places of work, hospitals, educational centers and from june of next year, there will be smoking bans in hospitality sectors, so bars, cafes, full service restaurants. these types of public smoking bans tend to have a short-term market but over the medium to longer term, they don't depress consumptional that much. we think that will be specifically the case in russia because if you look at the type

of hospitality that people entertain themselves in with russia, in the uk, the average britain will make maybe 30 transactions in a bar or cafe every year, whereas in russia that's only about 2, 2 1/2. you're not getting people where they smoke so much in terms of hospitality bans. >> who are the brands, i suppose the overseas brands that have the largest chunk of the market? >> well, jti have winston, which is the largest brand in russia. and specifically in terms of companies, we feel this new legislation will be toughest for philip morris, the world's largest tobacco company and imperial tobacco. philip morris has been investing trying to get some transaction behind marlboro, a key brand in russ russia, and the advertising restrictions that have been brought in will make it that much more difficult for them to get a hold into positions they

hold in other markets of the world. imperial, their portfolio is really an economy brand in russia and the economy is shrinking. so also, again, the marketing ban -- >> the economy section is shrinking? >> it's a premium market. people have more and more disposable income in russia. and mid price and premium are the ground segment in russia. if you look at the tax or excise increases that will come in the second tranche of this set of smoking measures, but don't increase that brand toward higher val brands. >> thanks very much indeed for joining us, shane mcgill. and earlier, we asked are more smoking bans a good thing or is the reach going too far? join us here with the conversation. e-mail worldwide@cnbc.com, tweet @cnbcwex or direct to me

@rosswestgate. a trade war between brusseles and beijing, it plans to reduce an average 47% tariff go ahead. the commission argues that chinese trade practices are unfair and could be dent mental to eu companies. but some member states, including germany, have warned against sectionism. joining us now is president of a lobby group which relates the lobby group representing solar industrial producers in europe. milan, i'm presuming you're going to argue heavily that tariffs region we talltory tariffs should be imposed. >> yes, of course. so china is dumping for about three years and with that, they have been able to destroy more than 15,000 jobs in europe. and we will be very happy if the european commission on wednesday that is expected imposed

provisional duties against chinese dumping. >> is this actually a viable industry without government support? >> it is. just imagine the cost of the -- the share of labor costs and production costs in european solar manufacturing is below 10%. so we are absolutely competitive with everybody in the world, but we don't have fair competition right now because china already put 200 billion euro into their solar industry. and so with that, they are financing dumping prices, prices far below production costs. nobody can compete with prices lower than production costs, of course. >> the german government is worried about sparking a trade war. you must share those concerns. >> the question is what is a trade war? if one country started three

years ago to break wto law and to dump with prices below production costs just to get rid of all of their international competitors, i would say this is really a trade war. they started it. and what happens now is that europe wants to production its own industry against it, nothing more. so -- but what we see then is that the sector in china has a very huge importance, is one of the key sectors in china where they put more money in than in any other sector in the industry. and so they try now to blackmail europe. and that happened. so they send the ambassadors to the financial weak member states. they started or they talked about retaliation. they started anti-dumping, so-called anti-dumping procedures against, let's say, french red wine, for example.

so -- but europe may not allow to become plaque mailed. we have to stand against that. so with that, i'm totally agreeing with the european commissioner who says, no, it is about much more than only the solar industry. it's about our complete industry in europe. we may not allow the state planned economy in china to overrun us completely. >> what -- what is the wto saying? this is surely a matter for them. >> so the wto is the framework. so, of course, dumping is forbidding under wto law. but every single country or block of countries introduced their own application of that law. so the european strayed law and the european defense instrument res completely in line with wto. so as long as europe and the european commission just apply the european trade law, it's fine with wto. but what china does is absolutely not okay and not in

line with wto. so on the one hand, dumping is forbidden. on the other hand, export subsidies are forbidden and the third thing is, blackmailing is forbidden. >> what is the -- while this is going on, how quickly is solar rolling out? the fact that we've got cheap chinese products helping to make solar more accessible? >> this is some kind of ridiculous. so it's totally accessible. and the cost for solar has been driven down all over the years and we -- but we can't accept to rely only on state subsidies from china and subsidized solar module from china. so we are in europe absolutely able to continue to bring down our costs, more than 10% year by year. so we really don't need that highly subsidized chinese modules. an athlete doesn't need doping

to run 100 meters. so we offer the installers in the uk and everywhere in europe the don't need chinese modules. >> thanks so much indeed for joining us, milan nitzschke. just a reminder of what's on the agenda in asia tomorrow, keep an eye on the central bank. investors will see if they take more action. first quarter current account is due. still to come, is motor city roaring back? u.s. auto sales are due today with an expectation that last month detroit made more vehicles than japan. japanese imports. we'll have more on that when we come back. we went out and asked people a simple question: how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age.

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you're watching cnbc's "worldwide exchange." hsbc's readingers for china are at the lowest level in a year and a half. stocks down heavily in istanbul as anti-government protests spread to cities around the country after three days of violence. a new report by global central bank watchdog group says financial markets are under a qe sell with investors ignoring bad

economic news. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. >> we've had the second weekly losses down last week. right now, we are called up above fair value. the dow is some 22 points above fair value. it was down 1.2% for last week. 157% is the nasdaq is below fair value by 3 points or so. the s&p 500 is pretty much on the fair value market. so in conclusive futures at this particular moment. it follows falls for european stocks at the open today. the ftse 1 00 down 0.8%. the xetra dax down 1 is%. the cac 40 down 1%. the ftse mib down 1%.

we've had pmi out which were better than expected. eurozone is still manufactur manufacturerary. and rises or better than expected number necessary spain and italy. germany is reach ago point of stability, although the italian pmi still the 22nd month of contraction, but we were 47.3, 47.5 in april. so the numbers were going the right way. and in the uk, as well, let's take a look at gilt prices, as well. gilt 0.023%. manufacturing pmi, 5 .3%, much better than the 50.2 that we had been expecting. new orders and domestic recovery again boosting that number suggesting the bank of england and mervyn king's last meeting this week were, again, not at the qe. interesting is whether mr. king himself after months, of course, of voting for more qe at his last meeting will still maintain that policy. treasury yields today also

yielding higher, 2.15%. we'll look ahead to auto sales and the ism manufacturing number a little bit later. and on the size of the currency markets are concerned, show you where you stand, euro/dollar, firmer. dollar/yen down to 100. aussie/dollar getting a bit of a boost after the official china hsbc number came in better than expected. 50.8. sterling/dollar, 1.52611. but i mentioned the good official number, the hsbc final may pmi reading did drop to 49.2. the higher flash estimates was 49.6. and that's the first contraction in seven months. hsbc's frederick neuman says there is a good reason to be concerned. >> we are actually getting increasingly worried. numbers have disappointed. not just in china, but throughout the asia pacific of the last couple of months and it's not just a slowdown in exports. we see some weakness in domestic command coming through, as well.

>> that was frederick's view. let's remind ourselves of what happened in the asian assets today. chloe cho has that report. >> a negative monday as the sell-off resumed in japan on fed tapering concerns. and weak chinese data. heavy futures selling and the nikkei shedding another 5112 points to close down 3.7%, a six-week low. ongoing volatility has left securities and real estate sectors in bear market territory with so much of the downside stemmed from derivatives oriented trading. some say the trend is likely to stay until june 14th. some of that selling pressure coming from negative data out of china. hsbc's final pmi is slimming from the flash number while there is some talk of a rate cut on the horizon. worries are right that the chinese economy is on a shaky footing. both markets close in the red. heavy selling over in the philippines. even with an rbi meeting, that seems to be a nonevent.

>> meanwhile, with anti-government demonstrations continuing in turkey, tens of on thousands took to the streets last night. barricades near the prime minister's office before police responded with water cannons and tear gas. the protests began on friday sparked by plans to build a shopping center on a public park. in response, the stock exchange has been down heavily. the bist 100 off 6% and the turkey lira is also down sharply. the istanbul stock exchange down 6.4% at the open. this is the lira. we were 1.8706 on friday. now 1.8920. and down at an 18-month low against the greenback. joining us more, associate fellow with me in the studio. fennie, thanks for joining us. these started out as small scale

protests and they've since expanded. is the problem the way the government handled the initial demonstration? >> no doubt, the way that the government mishandled the initial protests were quite small. it allowed the -- pushed these demonstrations to grow bigger and bigger. but really, they're reflective of a lot of concern and a lot of grievances held by quite a significant egg segment of the turkish population, vis-a-vis the government's policies on lifestyle issues such as alcohol consumption, construction and other issues. >> so what are those particular issues on alcohol consumption and construction that have caused problems? >> a lot of the turks are really unhappy that the government has been pursuing a mass construction boom across the country without taking into account local environmental concerns. at the same time, also a few weeks ago, the government passed a quite restrictive law on the

consumption sale and promotion of alcohol, which has also caused a lot of anxiety among much turks. >> so this is an economy, though, which has been doing very well. the government has actually taken as far as moody's are concerned brought it to investment grade. the company has been growing up 1.4%, better than russia or brazil. normally, this is what matters most is the creation of jobs and a stabilization. >> i think on the economic front also turkey may be witnessing a change. turkey did grow over the last ten years on average 5.2% gdp growth rates. but now i think last year, turkey grew 2.2%. this year, turkey will be lucky to grow around 2.5%, 3%. so the days of modestly high growth rates of 5% or over look pretty -- pretty much come to an end unless the government implements some substantial structural reforms. >> what is going to happen with this particular crisis?

what's the next stage, do you think? >> i think it looks like the government has adopted a very defiance and robust stance against the demonstration he. i suspect over the next few days we might see them continue if nots ka late. >> thanks for joining us. let's remind you of what's on the agenda today in the united states. may manufacturing index is out at 10:00 eastern. forecasts call for a reading of 511. it's up slightly from april. also at 10:00, we get april construction spending expected to rise 0.7%. on the earnings front, look for numbers from cracker barrel and government contractor saic. the big automakers report may u.s. sales today. total sales are forecast to rise more than 6% to an annual rate of 15.1 million vehicles. and that will be a rebound from a disappointing april hurt by lackluster results and weak sales to commercial customers.

auto analyst at citi is joining us now. thanks for joining us. good to see you. what's going to happen? are detroit sales going to outstrip japanese imports? >> well, the full size pickup truck segment we think is poised for another very good month in may. we think that segment will be up between 15% and 20%, outpacing across the industry. it should be a pretty good month. we think we're still very early on in the full sooiz pickup truck recovery here in the u.s. >> obviously, we've seen the underlying trends improve greatly over the last year or so. how much further is there to go on that? >> we think quite a bit. we think the market is fundamentally misanalyzed this segment for years. there's a wide consensus view that the pickup truck segment in the u.s. is structurally

impaired because there's a group of buyers who bought at the peak who are out of the market forever and our data shows that theory may have been completely wrong. we think there's so much pend pent up demand left in the full size pickup truck segment. every single one we think is far morrow bust than pickup trucks. we think we're early on in this recovery segment story. >> why was that analysis fundamentally flawed? >> it just made so much sense at the time with housing and oil that there was this class of the so-called personal use buyers that just bought a pickup truck without having to need it. it made sense that they had probably left the market because sales were so weak. what we think probably happened was that there was a massive deferral of replacement caused in the u.s. that they had more cars per household. our cars last a lot longer and we're driving fewer miles. so our dealer shows that a lot of that demand was simply deferred as opposed to permanently lost.

>> who would benefit most from this pickup in detroit? >> it's really the detroit three automakers. they really have a substantial position. and the great thing about that is given the concerns with the weaker yen, this is a segment where the competitive dynamics for the american automakers are so strong, that there's clearly less exposure from a yen perspective here, as well. these are pretty highly priced, high margin vehicles. this is really a story about the american automakers having exposure to this segment. >> how does that filter down the supply chain? who is going to benefit on the oem? >> well, you know, from the oems, we have the american automakers. some of the suppliers we've brought into this theme include american axle, companies like delphi have exposure. as much as it's profitable for the u.s. automakers, it's pretty profitable for the suppliers who supply into the large high volume, high priced segments.

>> good to see you today. thanks very much indeed for that. joining us from citi. still to come on today's program, entrepreneurs and investors are cozying up to the high tech conference after the break we'll hear from one investor that says it could be the next silicon valley. [ kitt ] you know what's impressive? a talking car. but i'll tell you what impresses me. a talking train. this ge locomotive can tell you exactly where it is, what it's carrying, while using less fuel.

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stocks are in the red on the back of poor china data, but violence continues in turkey as the markets fall sharply in istanbul with the ilra on the fly. and the stocks are sitting vulnerable to losses. the high berlin tech conference is under way. tech start up seen by many as rivaling london for its purely deal. with more tom mckenzie has this report at the conference. hi, tom. >> hello, ross. there are about 1500 start-ups here in berlin of various shapes and sizes. berlin has silicon alley. and over the last two days, yesterday kicked off today and

tomorrow. all these start-ups coming together along with ache yell investors, venture capitalists and the big established players like google, youtube and companies like shah zam to try and take it to the next level. one big players getting behind all of this is axle springer, europe's largest print media business. i spoke to their ceo last night and i asked him why he was getting behind an event that is supporting exactly the kind of disruptive businesses and innovators who have taken so much market share away from traditional media companies like his. here is what he had to say. >> for us, the digitization is the opportunity to transform a company on a totally different level. we see a lot more opportunities in this process than threats and that's why we are not only heavily investing into digital businesses and meanwhile generating 47% of our operating profit on online businesses. >> berlin is being touted as

going for the crown of europe's tech hubs, as it were. i wonder whether you think it can rival london's tech city and whether you think it could even rival silicone valley. >> well, you think, i think it's not about rivalry. it's more about cooperation and networking and the more hubs we have around the world, the better it is. we have to sense three of on our top executives for nine months to the silicone valley and where we were preparing that trip, we organized a tour here in some berlin start-ups. and one of the more famous silicone valley investors asked us whether they could join that tour and asked why you are so interested in berlin, we are sending the best people to berlin. some people think you need to send the best talent to berlin because it has the potential of developing into a silicone valley. i think berlin is a very attractive place. it's very affordable.

it has a very creative energy. and so i think in the future, we'll see a lot of dynamic development here. >> axle springer ceo matthew dotner speak to go me last night saying he sees more opportunities than threats in the start-up space here in berlin and in europe. that's why he's getting in on the act. he wants to get there before his rivals do and there's a lot of bars around the berlin heist get together this week. he's put a lot of money into it. venture capital, the big question, as well. is there the funding? a lot of funding traditionally coming from the uk and the u.s. venture capitalists here saying that is now changing, that shift is happening. but still urging more europeans to get into what's happening here. now, the axle springer ceomathis dotner,s knows a thing about innovation and change. he used to be a music critic before he took over his role at that company.

he wrote about new weight bans in germany and even eroticism in music. he's putting his money behind this and he's hoping that we're going to see one of the next big european facebook or google coming out of berlin or the rest of europe. back to you. >> it will be interesting to see whether they ever achieve it, tom. good stuff. hope you're enjoying berlin, as well. always a nice place to visit. banned smoking in certain public place necessary russia came into place over the weekend. it's also starbucks has clamped down on tobacco, the coffee chain is banning smoking within 25 feet of its storefront in the u.s. and canada. that new rule came into effect on saturday. earlier we asked are more smoking bans a good thing or is it going too far? achuthan tweeted, yes, banning smoking in a public place is the right choice. e-mail us, worldwide@cnbc.com,

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how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪

we've got quarterly results from the bank of london scheming today. the central bank found lenders full by 300 million pounds in the first quarter. in response, paul fisher said the picture of flat lending was to be expected at this stage. but at the same time, the investment market is evolving. one turn behind a new method for raising money invested on wednesday. the company is a crowd funding business aimed at providing early stage finance to go new firms struggling to get loans from banks. joining us from more, jean miller. and also backed by john morton, who everybody knows fairly well in this country is one of the leading private equity funders, as well. just explain how you're -- how are you going to be different from the likes of kick start and other crowd funding? there's a lot of cloud funding

companies up and running. why do we need another one? >> cloud funding has been going for years. it started in the area of donation based charity type platforms where people could get involved with community projects or ideas. it moved from there. recently you saw peer to peer lending platforms, which allowed people to sort of put money into -- loans into businesses. and more recently, you've seen equity platforms and investing zones in equity platforms. and we've just spun out of a london based ebc. >> so you've got a number of -- how much firms now on your roster looking for investments? >> we've got quite a number of firms. we're also in the london area. and we're connected to busine business -- a business coaching for growth program. so our sister company is involved in that. we have a good, strong pipeline

of companies looking for investments. the companies coming on all the time. what were trying to do at the moment is encourage investors to look for the platform. >> and how many investors do you need? is this individuals? is it businesses? what's the rate? >> no. it's individuals. there's usual high networks, investors generally invest in networks. we're also looking for a business savvy investors. people that aren't involved in networks because they have busy lifestyles, working 9:00 to 5:00. and having to turn that is probably too much for them. so what they would like is something like this where they can view companies on a platform at their leisure from their ipad and they can invest directly in those companies. so what we're trying to qualify basically intelligent people who understand business that like the idea of investing directly into companies. we make sure we qualify the

right sort of people. >> and those investors would be eis compatible to get a tax relief? >> yes. >> that would be something really important. >> something like sis, you get about 50% on your discounts in the first year. why wouldn't people want to get involved in that? it's a brilliant incentive. >> what is going to be your typical fund-raising amount and equity stake? will there be an average size, do you think? i know everything is different. >> it varies. we're looking at companies to see growth expansion-type companies. and these companies, as you know, you know, you're into the eis. and depending on the company in terms of, you know, what stage they're at, some companies are already in revenues. some may be in profits. so in terms of equity being offered, that will vary. it will vary usually from around 10% to 40% is the kind of raise you're likely to see in this sector. >> jean, we will track your

focus. >> thanks very much. still to come on the show, it's a voting day for shareholders. will they approve the near $10 billion tie up? we'll talk about that. as we go to break, it's a down day for stocks in europe than it was in asia right now. our futures are implying that we might pick higher at the open.

we're into the last half hour of "worldwide exchange." a recap of the headlines today from around the globe. stocks kicking off the months in the red. asia's manufacturing giants are slowing down. hsbc's reading for china, the lowest level in a year and a half. stocks down heavily in istanbul. the turkish currency down as well as anti-government protests spread to cities around the country after three days of violence. and europe caught by global central bank wash dog group says the financial markets are under a qe sell with investors ignoring bad economic news and that left stocks vulnerable to volatility. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. all right. if you've just joined us stateside, welcome to the start of your global trading week.

. the nikkei off another 3%. european stocks are in the red. but futures right now suggest we might get a tick up at the open. the s&p up nearly 3 points above fair value. 2.5 points above fair value for the dow. it's consecutive weekly falls, of course, for the s&p. the first time that happened since november. the ftse cnbc global 300, therefore, is down around 0.2% as we wait for the u.s. to get into the trading day. european stocks, we've had falls around 1% for the germ kwan and french markets. xetra dax down 0.9%. we've come off the lows. ftse 100 down 0.35%, as well. the ftse mib is down 0.7%. we did have pmis for the eurozone coming in a little better than expected. 48.3 was the final number for may. 47.8 is what was expected. and higher numbers in spain, italy and germany, as well.

near signs of stabilization still in contraction territory, but looking better than we thought. italy, of course, 22 months of contraction in the uk. better than expected manufacturing pmis, 51.3. input prices down, new orders up. the good news for the uk, as well. so what are investors to do at the start of this new trading week? here is a recap of what some of our guests have already told us today. >> turkish lira, which i think is very topical today, a time of issues across all the markets. weak growth, easing central banks. but we are up for a significant duration in which market turn is going forward. >> will the bank of japan be successful in ten years? yes, it will, it's obvious.

the amount that they have pledged to purchase is going to have an impact. yields have been capped at 1%. and what we've seen in terms of the market over the last couple of weeks is that it's only tweaks of policy that are required and that actually the yen is not seeing a run away weakness trade. >> it's basically a push up in production and his t economies will recover. but the order index weight as we look at these, the demand, it looks like -- i'm not quite sure the recovery can be down the road. so i would at some point remain positive on the global outlook. . >> some of the thoughts we've had. meanwhile, under the spell of central bankers, the bank of international sentiment says cheap money from central banks is pushing equity markets to record highs. in its quarterly review, action by central bankers has loud

stock indices to remain despite the headwind necessary europe. but mario draghi says a recovery of sorts is on the way. loose monetary policy and demand from abroad will see the block achieve what he call aes gradual recovery in the second half of this year. speaking at a conference in shanghai, draghi defended the bank's omt bond buying program. at the same conference, a top fed official says the central bank may need to let inflation rise above its 2% target to help bring unemployment down faster. speaking this weekend, the minneapolis fed president says strictly capping inflation while letting higher employment linger is the wrong approach to monetary policy. coach lakota didn't offer much into whether the fed will begin tapering its bond buying program. janet yellen is signaling they may need to impose tougher capital requirements on the bigger u.s. banks that go beyond

those. speaking in china, yellen says new regulations enacted is since the financial crisis have made et less likely a big bank will fail, but there may not be enough to ensure they don't pose a risk to the economy. the wells fargo ceo says the central bank is sending mixed messages on how much they want banks to hold. he's warned them against making banks hold more against long-term debt. fed chairman ben bernanke dawn doned his cap and gown on thursday. right off the bat, he joked about his own future if and when he leaves the fed. >> i wrote recently to inquire about the status of my leave at the university. and the letter i got back began, regrettably, princeton received many more qualified applicants for faculty positions that we can accommodate.

meanwhile, shareholders from both the nyc and euro defendant's exhibit nex will vote on the proposed $8.2 billion tie-up today. if it goes through, it will create one of the world's biggest derivative exchanges. peter leonardos is the director of rbc capital markets. peter -- >> good morning. >> good to see you. >> i think you said if it goes through. i think the votes today are a largely nonevent. but we'll have nyse voting at 9:30 eastern time and ice at 8:00. the majority votes required, they should pass by a margin. >> this time, though, perhaps less than the states but more in europe. how big a hurdle is that? >> the anti-trust in europe is ongoing. what it can do at that time is either pass it unconditionally or with conditions or it can extend it into a longer phase two review, which could take another three to four months. i would guess that the

overall -- of the two companies, nyse and the european continental exchange are minimal. we're talking some overlap in soft commodity, agency contract, that would be cocoa, sugar, coffee. i largely think this isn't an anti-trust issue, as well. it's a regulatory issue as you indicated. wa do the regulators want to give this merger clearance and what restrictions do they put around the spin-off of euronext post the merger. >> yes. this entity will dominate. european energy xhot commodity, otc credit clearing. so it's going to dominate those markets. and the regulators say, you know, too much dominance. >> but i would think, though, where is the overlap now? the overlap in cocoa, sugar, coffee. i mean, if you look at what i.c.e. does, it trades largely out of new york and it's trading energy-type products. and if you look at what life is

doing, it's trading financial-type products. so equity derivatives. the area of overlap is something that can be resolved by requiring a one party to cease trading it or inviting new entrants in such as the cme group. >> so the real attraction here is getting hold of the life elements. >> that's right. it's a delivives unit based in london called lice. it's now a $10 billion deal because of the re rating and the shares. you could make the strong argument that i.c.e. has paid $10 billion to get access to london derivatives. they don't want euronext. >> will that spin that off sfp. >> they will spin that off smp there's some chatter in the market whether they sell it or spin it. i think the regulators clearly want the european exchange toes be relisted again in europe. but then the question comes, as well, what happened to i.c.e. group?

i.c.e. is saying they are committed to maintaining that and that brand. but i think long-term, that doesn't seem like part of i.c.e.'s strategy to maintenance a nyse group, as well. >> they want u.s. equity sess what you're saying. >> that's exactly correct. but what you're effectively seeing here is you're seeing a break-up of nyse euronext is what has been put together and what you're seeing the chairman of i.c.e. do is putt take apart this financial conglomerate to help realize value. his track record has been successful. >> it's interesting. if he wants to sell off the equities business, does that put the nasdaq omx guys -- i mean, you know, are they going to be knocking on the door fairly soon? >> they would. >> they can block. >> right. >> when the deutsche boyerson were merging, the euronext launched a bid and what that entailed at the time was i.c.e. only taking the london

derivatives and fass dak taking everything off and the department of justice and the u.s. blocked them, they pulled the bid. so i think wa you're seeing here is you're seeing a break-up bid for the company and the shares seem to be reacting quite positively. >> if they spin off euronext, would the london stock exchange go, maybe we'll look at -- >> you know, i think everyone will take a look at it. deutsche borse will take a look at it and the london stock exchange will also take a look. but the london stock exchange group has been very successful in diversifying its business away from cash equities. and i think the last thing they would want to do is diversifying into continental cash equities. i mean, i think the lse has done a g great job of diversifying the ftse acquisition, and i think a diversification back into cash equities would be against the stated strategy. >> peter, by the way, very little technology in the talk about technology in sort to have breakdown. is that -- >> you know, very little. and there was the talk, as well.

that nyse euronext and i.c.e. say they don't know what they want to do with the technology yet. you could see a further break-up of the company than you and i just talked about. >> right. okay. we've spent a decade putting it altogether. that's why they're breaking up again. >> that's why i think with the shareholder votes, with the eu, it will clearly stay in the news for some time. >> in that case, you can come back. good to see you. still to come, i'll see you in court. not me literally, but apple is facing off against the u.s. government today in a long running dispute over whether it's keen to hike e-book prices. we'll get the latest on the issues the ipadmaker faces next. ♪

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then go to e-trade and find out how much our advice costs. spoiler alert: it's low. really? yes, really. e-trade offers investment advice and guidance from dedicated, professional financial consultants. it's guidance on your terms, not ours. that's how our system works. e-trade. less for us. more for you. apple in the news today on three fronts, courtney reagan is at cnbc hq in the states with more. hey, court. >> good morning to you, ross. the international trade commission has delayed a ruling on whether apple infrequented certain patents until tuesday. the patented in question involve the ipad, iphone.

in a preliminary ruling last september, an administrative law judge said apple hadn't violated the patents. the next step is for the full commission to weigh in. but apple has other pressing legal issues. the companies heads to a federal courtroom in manhattan today facing civil charges. it conspired to drive up ebook prices. the justice department will seek to seize on apple's introduction into the market to shift away from low prices by amazon.com. if apple is found liable, it could face claims from a group of u.s. states to join the government's anti-trust suit last year and could be exposed to private lawsuits. now, the "new york times" reports apple is pushing to get licensing deals so it can unveil its long awaited iradio streaming service next week. that's when the company holds

its annual developers conference in san francisco. iradio is reportedly similar to pando pandora, expected to be free, but supported by ads. record labels have stalled as they reportedly are seeking higher royalty rates. ahead of all this action, we are lower at least right now overseas down about 1.75%. a lot to watch here today, ross. as we look at apple and we consider where the market share is for this company that was once so very dominant with the sam song story kind of in the headlines, as well. back to you. >> it's going to keep rumbling. thanks for that, court. if you have just joined us with the headlines today, six stocks kick off june in the red on the back of poor china data. the european numbers operate. violence continues in turkey, the stock market falls and the lira is on the slide. markets are spellbound by the qe according to a central

bank watchdog. it says equities are sitting vulnerable to losses. meanwhile, some of the others stories we're following today, sac capital is reportedly bracing for around $357 billion as a probe to insider trading over the hedge fund intensifies. the deadline to submit requests is today. "the wall street journal" says if that number holds, it would represent more than half of sa a c's outside capital. the house oversight committee says a government watchdog report finds the irs spends around $50 million on at least 220 employee conferences between 2010 and last year. that includes a $4 million for an august 2010 gathering in southern california. for which the agency didn't negotiate lower hotel room rates, even though that's a standard government practice. employees received several perks including stays in presidential suites and tickets to sporting events.

a prominent chinese developer and banking mogul are teaming up to buy a new york landmark. janjing and a company called mata are reporting a stake nearly $700 million. it is one of the largest u.s. real estate transactions by an individual chinese investor. the 50 story gm building is a prize property located just off central bank across from the plaza hotel and its top tenants include fao swartz, estee lauder and an apple store. the lira is down sharply. catch the latest on the turkish situation at cnbc.com. also, from gre-xit to gre-corery. find out why it's slimmer than ever. plus, with multiple

investment banks signaling the end of the commodity super cycle, a world bank director has warned developing countries that have benefited from the search to prepare for a crash. still to come, u.s. market books take a break out of a recent fund can resume their winning ways after posting back to back weekly losses. we preview the trading week ahead when we come back. snoor. >> snoor. ♪ [ male announcer ] the parking lot helps by letting us know who's coming. the carts keep everyone on the right track. the power tools introduce themselves. all the bits and bulbs keep themselves stocked. and the doors even handle the checkout so we can work on that thing that's stuck in the thing. [ female announcer ] today, cisco is connecting the internet of everything. so everyone goes home happy.

we went out and asked people a simple question:

how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪ ahead of the u.s. open, european equities off their lows, currently nursing off around 0.5% to 0.6% at the moment. let's remind you of what's on the agenda meanwhile.

may manufacturing index out at 10:00 eastern. forecasts call for a reading of 50.1. also we get april construction spending expected to rise 0.7%. on the earnings front, look for numbers from cracking barrel and government contractor saic. u.s. futures pointing to a slightly better start this morning, indicating we will tick higher at the open. the s&p 500 currently 3 points above fair value. around 4 points above fair value for the nasdaq and 50 odd points above fair value for the dow. this follows a rough end to the month of may fort averages as they post back to back weekly losses. first time for the s&p. but the dow, nasdaq and s&p 500 have all closed the month in positive territory. that has made it five straight winning months to start the year. the last time that happened was back in 1995. michael gurka, managing director

of spectrum asset management joins us now. where were you in 1995, michael? >> i was wholeheartedly yelling my lungs out on this floor behind me at the exchange. >> good. that's what i like to see. consistency. what do you think about the direction of travel now for equities? last week, he seemed to start thinking that good economic news is becoming bad for equities. >> if that be the case, ross, which i'm not certain that that is going to hang on for long. that is normally the signal that tops are coming because everything has been gravy for so long. but just to highlight some of those numbers you just mentioned over the last five months, you know what would be awkward this week is to see the markets start to guy rate lower and have some of these low impact moves as far as volatility and then big drops behind them in front of this payroll number. that being said, i think that it's still a positive scenario for stocks for quite some time. but if you're going to see any rumblings, it might be right into and after that number friday. >> yeah. i mean, look, it's all about

what kind of data -- what kind of data means the fed tapers early, right? is that the game we're playing? right, it is. and i think a lot of that haas to do with the housing market. i'm fought going to put that at priority one. it could be a or b. but let's just say that the housing market becomes b and we start seeing stability in hou housing prices and more importantly new home sales in some of these statistics that come out monthly, always rolling something into a future scenario for myself. one of the things we've been following is lumber futures. it's a very ill liquid contract per se. but that being said, it was eight consecutive weeks lower from 400 down to the upper 200s in lumber and last week was the first week we saw a sharp rally above 300. let's keep an eye on lumber here because it has been consistent with slowdowns and then for the same reasons, when you start seeing value right now on a chart at least that looks similar to where corn was about a year ago and escalated

dramatically. that was weather related, but again, some of the same scenarios. look. >> looking at the technicals of oil, michael, we're down to where we were sort of a month ago for nymex and brent looks weaker, as well. are the technicals here bearish? >> well, the narrowing of the brent wti spread i think is right in line with people's specations. and for the same reason at least on the new york based wti, wa i've noticed at least on three-year charts, the 200 day moving average comes in around 88.40. the crude oil contract itself below 91 becomes a midterm bearish play. but if we see any violations below 88 within we can see a new channel, which would mean elongated pressure technically in the market and more importantly fundamentally is this belief that china is slowing down even more. but i'm not sure that's going to follow through. >> yeah. the spread actually was supposed to widen.

we've narrowed the it. a lot of people are talking about the spread widening again. are you in that camp? >> well, i think actually from historical level webs this spread would have been very hard to narrow much further from where it's at right now. i don't think uch seen any major investigation here. finding a spread to that value is similar to what we talked about in lumber. >> michael, good to see you. thanks for that. earlier we asked are more smoking bans a good thing? one of you tweeted, the ban is not the point, it's the motive. is public interest really in their hearts? we also had an e-mail saying the entire state of washington has banned smoking within 25 feet of any door, window or ventilation in public places. starbucks st extending the reach to all its stores. that's it for the latest

"worldwide exchange." "squawk box" is coming up next with the countdown of opening of markets stayedside. we hope you have a profitable day. bye for now.

good morning. the nikkei with its lowest drop in six weeks. could another turbulent month of trading be ahead of us? it's monday b, june 3rd, 2013 and "squawk box" begins right now. >> good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen. andrew ross sorkin is off today. let's start things off with the markets at this hour. joe mentioned japan. the nikkei closing down more than 500 points.

that's 3.7% drop for the benchmark index. among the reasons, you had friday's late sell-off on wall street and renewed worries about a slowdown in china. the nikkei snapped a nine-month winning streak in may. that had been its best run since 2006. in other asian markets today, you can see that the south korean kospi fell below the 2,000 mark. in australia, stocks ended at a ten-week low. the hang seng was down by about 0.5%. shanghai composite barely budged. and in europe in the early trading this morning, you can see right now that things are weaker, but these are modest declines, relatively speaking. the biggest decline is the dax. down by 0.7%. the ftse down by 0.4%. the u.s. equity futures here after the big declines late in the day on friday, dow is higher by about 55 points right now. is s&p futures are up about 4 points. here is a quick recap of the main market story. we had told you that those gains