hi, herve, you're watching "worldwide exchange." these are your headlines from around the world. drug deals, shares ofs at trtrt astrazeneca rising. phillips posting a bigger than expected drop in quarterly profits as restructuring costs weigh on earnings. the ceo telling us he's more optimistic about europe. >> when we talk about less momentum in the market, it is actually china that has slowed down. we see the situation in russia

affecting our business. europe is, i think, fully bottomed out. >> easing from china's central bank, the pboc saying it will cut the requirement for rural areas on friday in order to bolster the agricultural sector. he was described as the chosen one. manchester united have sacked their manager, david moise. you're watching "worldwide exchange," bringing you business news from around the globe. hi, everybody, welcome. yes, you're watching "worldwide exchange," after a long easter weekend for many of you, now back at work in full in europe, coming on to speed after we saw a thinner trade in the u.s. compared to what's normal given the european holiday yesterday and the stock is higher, just shy of 1%.

we're still early days, right? our main european markets looking like this. the ftse a big higher, the xetra dax shy and the ftse is a couple of points lower. it's been about m & a, it's also about worries and ukraine and what's taking place there. back to what's going on in m & a, astrazeneca shares soaring after pfizer made an informal $100 billion takeover offer in what could be the biggest pharma deal ever. meanwhile, investors have been welcoming news that the swiss pharmaceutical company novartis will be requiring the oncology division of glaxo smithkline for $14.5 billion. it's also selling glaxo smithkline's vaccine unit for $5.25 billion. big news there.

novartis is selling its animal health division to eli lilly for $5.4 billion. all of these stocks trading higher. over here on the corner, philips posting a bigger than anticipated drop in its quarterly profits. restructuring costs and the strong euro, they say, have weighed on earnings. we'll be talking about the m & a momentum, especially heading into the session today. let's take it back to the macro environment. we're seeing selling of the 10-year gilt. as well as the bund. we'll be getting thoughts from one of our main guests this morning about what he thinks of periphery bond markets. currency rates, here we're

looking at the euro dollar, very flat. still around 1:38 level. no change there. dollar/yen hanging on to 102.5. remember, we've got both the u.s. fed, we have the bank of japan, giving announcements later on this month. so we're kind of gearing up once again to be looking at a macro environment. let's check in on markets in asia and what's been going on there. sri is in singapore. good to see you. >> hi, great to see you as well. >> more stimulus in the chinese government in the form of cart in the triple law. the chinese premier didn't outline details. now we have the details.

what this effectively means is that these rural banks will have less incentive to park some of their funds with the central bank, the pboc, the people's bank of china. that should mean in theory there's more cash available to lend, to deploy into the real economy and stimulate growth, remember, which has been slowing. that's the basic background. you have to appreciate the timing here, come on the back of the release tomorrow. scheduled release of the flash manufacturing pmi number from hsbc, the private forecaster and for all intents and purposes, luis, l louise, we are looking at levels below 50, whether it stays below 50 or drops precipitously below 48 is the big question, and if it does signal a sharper decline in economic activity, that could be negative for asian equities.

shanghai composite clawing back some of the losses 2,072. dollar weakening against its japanese counterpart. so a stronger yen doesn't body well for the exporters and by implication the equities market. we're coming off from this two-week high we saw on monday. residual caution as we hit the full stride in japanese corporate earnings in the next couple of weeks. be watching that as an indicator and as a prism to view its success or failure if the case may be through. elsewhere, broad consolidation in some markets. i want to point out the -- there's a sense it could be hotter than expected.

back to our top story, astrazeneca shares have been soaring in london on reports of an informal takeover offer from pfizer. cnbc understands that pfizer is mulling an offer which values astrazeneca at more than $100 billion. a separate report is saying astrazeneca has hired morgan stanley to advise on this potential bid. novartis has unveiled big changes to its portfolio. it's going to be acquiring the oncology division of glaxo smithkline for $14.5 billion but also selling glaxo smithkline its vaccine unit. a lot to talk about this morning. tim skeet is the managing director of financial institutions at rbc.

welco welcome. >> rbs. >> it says rbc. i know it's rbs. i said rbc. it's rbs. let's start with this m & a momentum we're seeing heading into the session today on drugs, especially. what do you make of the latest deals? >> we saw a lot of activity in 2009 when we had three mega mergers led by pfizer, actually. and a consolidation in the sector. today what we're seeing is what is rumored to be the caring in the sector, big cap pharma, too big to grow earnings and revenue sustainably. we're seeing a narrowing and focusing of businesses along strategic lines for many of the pharma companies out there. >> do you think the deals we've heard so far, do they make sense in terms of the amounts being paid first and foremost? if you look at pfizer's informal offer for astrazeneca, $100

billion. >> that makes sense to some degree. i think shareholders would probably welcome such an offer because it would take the uncertainty astra has. so from that perspective, i think that would make sense for pfizer. they have stock cash pile to use which is valuable for them from a tax perspective. >> when you look at what's continuing to drive our markets and what's continuing to drive news flow, ipos definitely up there, m & a definitely up there as well. >> i think there's a lot of appetite to take a fresh look at everything right now. we've just come out of this period of all sitting in the gloom and the dark, particularly in the west. i'm not saying the sun is shining but from an economic perspective, things look so much better, politically in person europe and north america. you can argue what's going on.

the underlying economics point in same direction. that's the confidence, right? i think business leaders have got confidence. therefore they'll put their money on the table. >> i agree. i think that the level of confidence in the secretary are, despite the fact there is pressure on revenues and margins are driven by revenue. the pharma companies want to effectively capture that value chain effectively. that's why we're seeing the structural changes occurring. >> when i look at the novartis deal, they're buying this oncology unit from glaxo, they're combining the consumer division as well and they're selling the animal health division, too. they're doing a lot of things. it seems that this revamp is really quite broad for them and it also means -- what ends up happening is glaxo smithkline will be running this consumer health business with novartis but at the same time, giving up ambitions to be an oncology

leader. >> we've seen this with bristol. the land escape is uncertain. there will be cancer vaccines that will dominate this whole sector. glaxo has taken a strategic view of getting out of oncology and focusing on its strengths. that's the reason why novartis is divesting animal health as america is doing. the focus will be in the on-call areas rather than getting distracted by peripheral areas. >> glaxo, they're returning 4 billion pounds to shareholders after these changes as well? >> yes. >> how much of it is about figuring out how to provide value for shareholders at the moment because you can? because markets are in a beneficial stage to do precisely this? >> part of it is about appeasing shareholder concern about growth prospects in glaxo.

the 4 billion pound return helps. more importantly than that, it's about the signaling and the longer term story, the revenue and earnings profile and the growth of those things. within glaxo, that's very important. that's what glaxo is intending to deliver on. >> it's one of those sectors where you have to plan incredibly long term with huge amounts of uncertainty and risk. presumably this is further consolidation of the sector. is it driven purely by the shareholders or find other interests come into play here as well. >> to some degree, the shareholders are sitting on the sidelines to be honest. i think shareholders are not sure where this market is going, where the sector is going in the pharma world. large cap pharma companies are under pressure. they can't provide that revenue growth they enjoyed historically. as a result, i think the large cap pharma companies are in the end game, as far as i'm concerned, no more mega mergers,

they're not pattalable for shareholders, they don't want them. that's the end game. if this doesn't work, the pharma sector will have to take a long, hard look at themselves. >> is this the recognition that we're moving away from high growth to something which is going to be very -- >> perhaps even more fmcg, fast moving consumer goods and potentially utilities as an angle. where i do see the growth is the biotechnology sector. i think it's tremendous in terms of enknow vacation, growth, look at gilead and hepatitis c. the pharma sector will dip in and acquire assets s on an as needed basis. >> lovely seeing you this morning. head of life sciences research at senco securities. get your questions through on e-mail or twitter.

@cnbcwex is the twitter address at cnbc.com as well. staying in the sector, bill ackman is making a joint bid for botoxmaker allergen. ackman's pershing square began building a stake in allergan in february. they will finalize and announce the proposal soon. allergan is advising shareholders not to do anything right now. coming up, russia could face further sanctions from the white house as rebels in eastern ukraine show no sign of backing down. we're live in the eastern ukrainian city of donetsk in just a couple moments.

you're watching "worldwide exchange." hi, everybody, welcome back. the white house is threatening to implement further sanctions against russia if the kremlin doesn't call on separatists to

vacate buildings in east ukraine. there's been little sign of rebels backing down. the u.s. has also revealed images which it says shows russian troops operating in ukraine, a claim which moscow has always denied. now, this all happening as the u.s. vice president biden is set to meet with ukraine's new leadership in kiev today. joining us now is nbc's elbina kovalyova. >> reporter: at the moment they're expected to talk about the elections due from may 25th and an aid package to ukraine. while that is taking place, the tensions here in east ukraine are high. this follows an attack on sunday that left three people dead.

today, the first funeral is taking place. it is unclear who is behind the attack. the ukrainians have called it -- called responsible the russian secret services and russia has in turn said it is the far right sector, far right group. now, the tensions here are also high because there are reports that journalists are missing, these are russian journalists, ukrainian journalists and foreign journalists from other countries, international journalists. speaking to people on the ground here, also the worries are growing of some sort of armed conflict. ukrainians here don't understand which side is which, who to believe, whether they can believe the reports on television and the fear is growing, that something bad is going to happen and the situation is going to escalate. louisa? >> thank you very much. we have a former british ambassador to russia.

he joins us now in the studio. welcome and thank you very much for being with us. what's your take on the activities that are taking place now and how do you read the situation? >> your correspondent has accurately reflected the confused situation there. what is actually happening is that russia is pursuing, very successfully, a policy of destabilization, infiltration, strangulation, designed to lead eventually to the capitulation of this fairly weak, fragile interim government in kiev so that it sues for peaces on russia's terms which have been clearly stated. russia will hope to achieve that without formally invading ukraine. that's the problem for the west. they've held out the deterrent of sanctions, but triggered by an invasion in this unclear situation, what's the west do? >> you're saying russia wants influence of ukraine but doesn't want the full takeover? >> if russia had to own ukraine, it would land itself with a big and expensive problem. if it invaded ukraine, it would

put itself on the wrong side of the world for as long as its occupation lasted. it seems to me there's a lot of down side to that for russia. what russia wants is an emasculated ukraine. and a weak ukraine dominated by moscow would, i think, suit the kremlin very well. >> doesn't russia just want a place at the table, a seat at the table? isn't that all that it's afraid of? the ties from the eu, the proposals from the eu have been quite binary, you either choose to be with the eu or choose to be russia. russia doesn't want to lose that opportunity. >> i don't think that's the case at all. anybody who looks at a sensible long-term future for ukraine has to say ukraine needs to have a strong relationship with russia. it's absolutely natural and needs to be free to have strong relations with its neighbors on the other side. ultimately that's the way

ukraine will develop. when ultimately will be is hard to say at the moment. >> it kind of gets the sense that policy is being made up on the spur of the moment, it's opportunistic as opposed to strategic, though obviously you painted the big picture. what is this going to cost russia economically and politically in the medium to long term? it's already costing russia. ukraine was not a probable for russia. putin's problem is russia. this is neatly diverted atension away from it. the russian economy did extremely badly last year. it will do even worse this year, partly as a result of what they're doing now. the former finance minister forecast the capital flight will reach $160 billion out of retof russia. the markets have gone down, the ruble has weakened. putin failed to deliver on his promises, diversify. the people are not happy about

that. people were delighted russia has crimea, pretty unhappy about their own domestic situation. that's his real problem. he doesn't solve it by doing what he's doing in ukraine but he does divert attention away from it. >> you're talking to a short-term victory with a medium turn. >> you have an apparent victim in crimea already. russia already had the naval base in crimea. over time, if putin is able to achieve what he wants, which is essentially a subserviant ukraine. putin originally wanted russia to be a respected international status quo player, one of the world's advanced countries. this is another step away from that original objective. >> so the final question is, why should we do anything in the

west? what should we do? >> defending the principle of the sovereignty of a member state of the united nations, the sovereignty of ukraine is critically important. if we just ignore that, then there are thousands of situations around the world where other people's sovereignty will be vulnerable. 100 members of the united nations voted against the annexation of crimea. the only country which is supported russia were maverick states like north korea, syria, places -- zimbabwe. >> both our guests will stay with us in studio. we'll continue on and give you more details. u.s. president obama will be leaving for south korea, malaysia, philippines and security and trades are on the agenda. last year, obama had to cancel a trip due to the budget

wranglings. cantor is also in e. yesterday's boston marathon, bombings at last year's race left 3 people dead and hundreds injured. a crowd of 1 million people showed up to cheer the runners on. and in other sports news, manchester united soccer club were they've sacked david moise after only one season as manager. moise was hand picked by alex ferguson but the team failed to secure a spot in next season's lucrative champions league. they've been largely flat over the last 12 months. they're up 14% year to date. you're a man u. fan. what do you make of this? >> the point about them, they'll

come back again. they're a real football club. they're not the result of injection of billions of -- pounds of foreign money by a foreign owner. it's healthy for football. they won't completely dox nature the premier league this season as they have done for so long. it's good to see real football clubs like liverpool, everen to, southampton, swanzey doing well. >> who is poised to take over? >> i think they'll have to go probably for a foreign manager. >> and will the person who takes on the role now, will they have a better chance at leading the club to better highs? >> david moise is obviously a decent man. he had a find record at everton.

i think he's been unlucky. very interesting, the loss of self-confidence. they had a very good away record this season. it's the fact they haven't been able to win at home. if you don't can win in front of your own crowd at trafford, that shows lack of confidence. i think the new manager can build on that. they'll come back. >> i love it. brilliant. coming up, we want to know, is shareholder pressure unhealthy for the long-term success of sports clubs, how long should a new coach or manager get to prove his worth? one season or do you need more than that? especially if you have big shoes to fill. cnbc.com by e-mail, twitter @cnbcwex or @louisa

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you're watching "worldwide

exchange," bringing you business news from around the globe. hi, everybody, welcome to "worldwide exchange," i'm louisa bojesen. these are your headlines from around the world. drug deals, shares of astrazeneca soaring on an informal offer from pfizer. glaxo smithkline also on the rise after announcing a deal with novartis for its consumer business. philips announce a restructuring project. >> we talk about less momentum in the market, it is actually a china that has slowed down. we see the situation in russia affecting our business. europe is, i think, fully bottomed out. >> well, easing from china's central bank, the pboc is saying it will cut the reserve ratio requirement for some rural lenders on friday in an effort to bolster the agricultural sector. as you just heard, he was

described as the chosen one. but after one disastrous season, manchester united have sacked manager david moise. hi, everybody, welcome back. our european markets seeing a little bit of buying. we saw positive session overnight. we saw a positive session in the u.s. yesterday, although on thinner volumes, given the europeans were off for this long easter weekend. this morning, coming back to trade, we're seeing a hop for most of our european markets, the tooftse mib slightly down t morning. the treasury and the italian tenure, the u.s. ten-year treasury and the italian ten-year bond both seeing yields coming off just by a tad. when it comes to the currency markets, we're hanging on to these range-bound levels we've

seen for a very long time. still hanging on to that 138 level. we'll talk more about that later on. back to some of our main business stories this morning. barclays is the latest bank planning on winding down its commodities division by exiting parts of its metals, agricultural and energy businesses according to reports. we are joined on set by helia with the details. some might be thinking if the economy is recovering, we're seeing a slowdown in china. we can still live with 7.5% growth. why would you choose to get out of commodities? >> it's a big part of barclays business but it's a part of their business that's been under pressure, under pressure twin-fold. one because regulation is increasing in those areas, becoming more difficult to operate in those areas. and two, profits are declining, partly because of the regulatory environment. last year we had the david moise of banking, anthony jenkins say to investors, look, on ethical

grounds, as part of the transform program, i'm going to make sure we only follow clients who are in food production. we're not going to help investors just speculate on price. that's not the barclays that i'm in charge of. remember that barclays is trying to shift monumentally its culture at the moment from the bank that was run by bob diamond, based on heavy bets and risks and the investment bank to one that's safe and secure. i think commodities like lots of benchmark rates, is a potential ground for investigation. there's several investigations into gold, for example. and oil. and as we know, into fx, following going from the libor situation. other commodities could follow suit. barclays has its agm this week. that's going to be hugely controversial because of the massive bonuses it's paying bankers is trying to hard to win the public round and win

investors round. >> but you have a division as well with regards to who's staying in commodities and who's getting out. it's not barclays saying we might take a back step on this one. >> you have jpmorgan who also moved out of that sector. as i said, it's an area that has suffered in terms of investment bank. i think a lot of parts of investment banking has suffered. the whole has had a difficult year, two years. that's not to say if barclays was to close all of this, i think you'll see a third of its profits disappear. it's a big tight rope act that anthony jenkins has to follow, on the one hand making sure a huge part of its investment bank is growing and still returning money to investors. on the other hand, making sure that that investment bank is being managed safely and soundly

and employees aren't being paid too much. they got out of the tax business which was a huge money spitter for barclays just a while ago. >> thank you very much for now. helia rahimi. we'll talk more later on. the french government wants the nation's top bankers to justify their 2013 pay rises. what's this all about? stephan is in paris. how are they going to do that if you have to justify your pay rise? >> the new economy minister wants to organize a meeting with the top bankers to ask them about their recent pay rise. earnings rose by 38% last year, by 29% at bpc and 14% at another company. it wants to discuss it with the banking community not only because of the pay rise but he

believes bankers in france are not doing their job properly. small companies have trouble to get funding for their investment, forcing them to turn to the market historically, 75% of the funding comes from the banking industry and 25% from the market. in france. it's now the ratio has changed recently, 35% only is coming from the banks and it's a problem for small companies because they don't have access to the market. it seems as the economy minister is using the excuse of the pay rise to discuss that funding problem with the community. it's not a first-time that a minister or president in france is pointing the finger at the banking industry. if you'll remember, a few years ago, the former president, nicolas sarkozy accused bankers of being overpaid, not doing their job. they'll have to attend the

meeting with the economy minister. we don't know the date, when it's going to happen. of course we'll follow the story. >> as usual, stephan, sounds good. >> as usual. >> did you have a nice easter weekend? >> fantastic weekend. >> what did you do? >> can i say that on tv? >> i don't know. i don't know. i wasn't there. >> no. i had a fantastic weekend. what did you do. >> i ended up going to the middle east. yes. saw some friends, et cetera, et cetera, fantastic. really nice. you? you don't want to tell? >> i was in the south of france. >> very nice. very nice. >> i stayed in france. >> excellent. long way to go for a chocolate egg. what did you do, tim? >> i did jobs around the house. i painted a bench. how's that? >> very nice. >> handy man. >> put in, changed some lightbulbs. >> excellent. we love men who can do stuff like that. >> try to be useful occasionally. >> it's all good. stephan, thank you very much. astrazeneca shares soaring

after pfizer reportedly making an informal $100 billion takeover offer in what could be the biggest pharma deal ever. meanwhile, investors welcoming news that the swiss pharmaceutical company novartis will acquire the oncology department of glaxo smithkline. in a completely different deal, novartis is selling its animal health division to eli lilly for $5.4 billion. shares in philips taking a tumble this morning as the company kicked off european earnings season by posting a bigger than expected drop in quarterly profits. restructuring costs and the strong euro weighing on earnings. now, switching over to something else, portugal's short-term economic prospects are improving but it must keep up reforms, including the job market, liberalization to avoid falling back into growing debt. this is according to the imf. meanwhile, the troubled nation which is set to exit its international bailout next month, it's announced that it

will offer up to 750 million euros in ten-year bonds on wednesday. this auction could be portugal's first since april of 2011. what do you think, tim, do we buy into the peripheral european bonds now? >> i'm torn in two different directions here, louisa. on the one hand i've been saying consistently let's not worry too much about countries like spain. i've been a skin the supporter, i wouldn't say a bull, right away through the darkette hours of the crisis. i come out of this saying i told you so. on the other hand i don't want to say that either. within i look at the buying interest that's underpinning all of the markets, i begin to say, well, why is it quite so strong? where is the risk judgment here in? we understand people want yield. therefore, there is a current rush to yield as witnessed by the tremendous success of the greeks the other week. looking also at the hybrid

securities issued by financial institutions. all of that points to the fact that people are investing first, then asking questions after. i wonder if that's perhaps where we are right now. >> if i bought greek bonds at 25 and i sold at 10, why would i want to get in at 5? >> this is -- i think people are turning the page. i think people say, look, i took a loss back then. those were the markets then. i had to deal with what i had to deal with. remember, a lot of investor activity is by reference to what's happening in every other investment fund around them. if everyone is doing one thing at one minute, you say i'm following, doing what i have to do. let's change tack. we're talking about a different market and now i have to bench mark myself on what other people are doing today. we've got this curious mixture of short-to-medium termism creeping in. one still has to ask the question, are people doing their home work? that's the question i've consistently asked. are people really sitting down and thinking long term over what

they should be doing? that said, i remain a supporter of these peripheral markets. i think the eu stepped in, ecb has been very credible. that kind of glitch we had at the beginning that plunged this into the mess, that sort of patched it up. it's a little bit fragile. >> you'd buy portuguese bonds? >> i think i'd be supportive of portuguese bonds, absolutely. >> tim skeet, managing director of financial institutions at rbs with us this morning. thank you. toyota is considering expanding production in china, aiming to catch up with rivals like vw and gm which have been eating into market share. toyota wants to double annual sales there to 2 million vehicles. electronic carmaker, the electric carmaker, tesla is looking to manufacture its car locally in china over the next three to four years. that move will be helping tesla to avoid china's import tariff of 25%.

today is a historic day in china as it makes the delivery of its model s in the nation. customers outside beijing and shanghai will have to wait until at least june due to a lack of service centers and changing stations. now, full-year earnings, they're getting well under way in japan. we go to the nikkei for the early results from tokyo. how are they looking so far? >> hi, louisa. the nikkei news is reporting today that some of the major japanese firms generated strong results, topping forecasts. japan's second largest drugmaker is offering profit likely grew 14% on the fiscal year. it's expected to post $1.7 billion, achieving a third straight year of operating profit gains. strong sales of cancer treatment

xtandi tripled to $90 million in the u.s. market. higher revenue helped absorb the costs of research and investment. up 56% on the year. brisk demand for products related through solar power generation helped drive growth. the firm's revenue and profit are expected to grow for this fiscal year as well. and tokyo disney resort operator operating profit rose 35% on the year to $1 billion in fiscal 2013, setting a new record. thanks to the weaker yen, the number of visitors from abroad also increased. back to you. >> thank you very much. good seeing you. staying in asia, the chinese president xi jinping has backtracked on the country's policy of capping medicine retail prices in his move to

provide affordable health care. the country is now set to allow pharmaceutical companies to set prices to are some drugs. they also want to support burdened public hospitals. how about the private hospitals, though? the u.s. health care provider xindex has agreed to a sweetened $461 million deal, a takeover offer from a group led by tpg and shanghai pharma. eunice yoon looks at the prescription for profit. >> reporter: if you travel to beijing and find yourself under the weather you could wind up at this hospital run by american roberta lipson. l lipson was one of the first in china to establish a private hospital. if the government has its way, there could be more of them. >> the private sector should play a supplemental role to the public system. >> this is the central lab. >> reporter: the nasdaq listed

company manages a chain of clinics here. she first arrived in 1979, selling medical equipment as the economy was opening to the world. >> this whole concept of private health care in the people's republic of china, a communist country, was to some people abhorrent. to some people laughable. by 1997 we finally had the final approval. it took 180 different government chops to finally get our doors open. >> the government here wants to reform health care. its system is dominated by the state. but public hospitals like this one are overtaxed and underfunded. so too many chinese consumers save for future medical bills rather than spend. right now only 12% of china's hospital beds are private. by 2015, the government wants to raise that to 20%.

yet it's unclear how quickly the doors will open wider. private health care providers are burdened with red tape. >> now, of course, the government has decided that private health care is an integral part of their health care reform plan. the approval process has been somewhat simplified. but what's satisfying to me is that the government now really recognizes well regulated, well run private hospitals can take some of the pressure off of the public system. >> reporter: with health care spending here estimated to hit $1 trillion by 2020, that could be just the remedy china needs. eunice yoon, cnbc, beijing. and let's give you a look at what's on the agenda in asia. tomorrow, president obama arriving in japan on wednesday, seibu holding will be listing on the tokyo stock exchange.

and you have hsbc's china flash pmi reading for april will be released and expect earnings out from korea's lg display. a lot on the agenda. coming up, ipo fail. we'll be hearing from weibo's chairman saying the ipo listing was price today low. stay tuned to find out more about weibo and the market. you're watching wch. on cnbc. good morning, everyone.

hi, everybody, welcome back. you're watching "worldwide exchange." i'm louisa bojesen. netflix first quarter profit rose beating forecasts while revenue was roughly in estimates. the streaming video company added 4 million new subscribers worldwide, more than expected, thanks in part to the launch of season two of the original show "house of cards." netflix plans to raise prices for new customers by $1 to $2 per month this quarter. the company is also making public its opposition to the proposed comcast/time warner cable merger saying it would give comcast, the parent of cnbc, leverage to charge higher fees on content companies that rely on its high-speed broadband

network. >> brian roberts is incredibly thoughtful. if there's anyone you wanted to trust with controlling half of the u.s. internet, you might pick brian roberts. he's thoughtful, long-term about it. reasonable. i don't know if we want anybody to control half of the u.s. internet. that's the base is of our objection to the mergeer. >> in a statement, comcast says netflix's opposition isn't about protecting the consumer or net neutrality. it's about improving its business model. netflix, you can see, the german listing higher by almost 12% this year, pretty flat, up by a meager 2% or so. shares in philips have taken a tumble as the company kicks off european earnings season by posting a bigger than expected drop in quarterly profits. restructuring costs weighing on earnings in the first three months of the year. speaking first to "squawk box" earlier, the ceo told us he

remains concerned about emerging markets. >> when we talk about less momentum in the market, it is actually china slowed down, we see the situation in russia affecting our business and then there are many smaller countries that are under pressure that have volatile currencies. europe is, i think, fully bottomed out. we saw some upticks in the southern european countries which is giving us confidence. but at the same time, the northern european countries are not yet getting into second gear. so europe is still flat for us. now moving on, weibo shares have risen 33% above the ipo price of $17 since its bay due on the nasdaq last thursday. were the shares price today low? that's a question many people are asking. susan lee caught up with the company's chairman, charles chow, and asked him why the offer price was lower from what

many people thought. >> in hindsight, it was priced low. but if you look at the market in the last two weeks with be it was very tough. if you had a chance to, i mean, take a look at all the ipos in the market in the last two weeks, most of the ipo were priced we low the range and the most ipos traded below the ipo price. actually we were lucky enough. price was in the range and it traded up after that. so i think it will be okay. >> weibo listed on the nasdaq and of course everybody is waiting for the nyse debut of alibaba. why are chinese tech companies still choosing to go to the u.s. instead of closer to home? >> i think, you know, most of chinese internet companies are listed overseas, mostly in u.s. i mean, fewer in hong kong. part of it because current china's listing law or regulation actually have some problem with a lot of internet companies in china have the

structure. you have a problem listing any chinese symptom exchange. if we have a choice, we always wanted to list the whole market, which is closer to our user base, which makes a lot of sense. and asia comes in higher than any other exchange in the world. it was just by default. i mean, the u.s. market becomes the place for listing. >> now, alibaba continues to generate buzz ahead of its much anticipated ipo. what exactly is the e-commerce giant all about? and just how big is it? josh lipton breaks it all down. >> in only 15 years, it has exploded from just an idea to an e-commerce powerhouse, responsible for for half the parcels delivered in china and more than 60,000 transactions per second.

jack ma founded alibaba in 1 999. now he's prepared to take the country public. alibaba is often compared to american e-commerce giants such as amazon. alibaba does not directly sell goods. it operates websites to which consumers buy and sell goods with each other. alibaba then makes money from advertising, which accounts for the bulk of its revenue. in the final quarter of 2013, alibaba generated revenue of 3 about the $1 billion, a 6% jump year-over-year on the top line. analysts at cantor fitzgerald peg its valuation at $184 billion. for investors, alibaba offers exposure to the chinese e-commerce market. by 2020 that market is expected to be bigger than the u.s., britain, japan, germany and france combined. j josh lipton, cnbc, silicon valley. in other sports news, manchester united soccer club have sacked david moise after

only one season as manager. moise was hand picked by his predecessor, alex ferguson. the team failed to secure a spot in next season's lucrative champions league. is shareholder pressure unhealthy for the long-term success of sports clubs. how long should a new club get to prove its worth? if you want to join the conversation here on "worldwide exchange," get in touch with us by e-mail, worldwide@cnbc.com. or via twitter cnbcwex or directly to me at louisa boje@l. we'll see you straight after the break.

hi, everybody, welcome to "worldwide exchange." i'm louisa bojesen. shares of astrazeneca soaring on a rival offer from pfizer. glaxo smithkline also on the rise after announcing a deal with novartis for its consumer business. philips posting a bigger than expected drop. the ceo telling us he's more optimistic about europe. >> we talk about less momentum in the market. it is actually a china that has slowed down. we see the situation in russia

affecting our business. europe is, i this i, fully bottomed out. and easing from china's central bank, the pboc is saying it will cut the ratio requirement for some rural lenders on friday in order to bolster the agricultural sector. as you may have heard, he was described as chosen one, but after one disastrous season, manchester united has sacked manager david moise. you're watching "worldwide exchange," bringing you business news from around the globe. >> hi, everybody. you are indeed. welcome to "worldwide exchange," the second hour of the program. we're just getting under way with trade here in europe. we've been up and at it for about two hours now. we're looking here at the u.s. futures and how they're shaping up. we're a couple hours away from the opening in the u.s. we're looking relatively flattish right now in terms of the opening call state side here

in europe, we were called a little bit higher. we are hanging on to the slight gains. we saw gains in asia overnight, positivity in the u.s. yesterday. europe was off yesterday for that wonderful long easter weekend. thank you very much. today we're all back at work. the ftse 100 higher by 0.8%. xetra dax up by 1%. the cac adding a delicate half a percent. the bond markets, a portuguese bond offering. buying in the treasuries and in the ten-year italian while the ten-year bund and gilt are selling back a bit. when it comes to the conferencecy markets we're not seeing much movement. the euro dollar hanging on tight to that 138 level, very range-bound trade. we've seen a little bit of repositioning, all depending on what the ecb president is

saying. we seem to come back and hang on to the 138 level. as we get forthinto european trade, let's check in on the markets in asia. and hear what the news has been there. sri jegarajah joins us from singapore. sri, what do they need to know about what took place in the asian markets? >> we saw consolidation thanks to the momentum in the u.s. markets and also the upbeat earnings. but there was some divergence as well. there was negativity, especially coming out of the nikkei 225. i suspect that are related to the fact we are getting into the full stride of earnings season in corporate japan in the coming weeks. there is a degree of caution in the markets. these earnings will be, once again, a big test to whether arboonomics is succeeding there.

shanghai composite, worth looking at this one as well. in the last hour or so, we did hear from the chinese authorities in beijing has said they will cut the triple r effective on april 25th. this is this friday incrementally. this cut will be apply to some of the rural banks. what this means in practice is that these banks have less incentive to park funds at the central bank, the pboc. that forced them, to a degree, to deploy that cash and lend into the real economy. this is stimulative. this is once again, a prudent macro economic management is the way that beijing would like to describe it. it's incremental, gradual. they've gone to great pains to explain this isn't necessarily a prelude to broader monetary policy easing. interesting, though, to say the least. this is coming just before tomorrow's hsbc flash pmi number, the initial number for

managing from the private forecast for the month of april. so if it does weaken, then this would be in line with this rebalancing in the chinese economy, away from investment-led growth and towards more quality consumer-led growth. this is going to be a long process. there will be bumps in that process. the markets will question if it is weaker than expected. we have aussie cpi. the aussie dollar will be watching. if it's hotter than expected, expect the aussie to make a run towards 94 cents against the dollar. those are the big highlights. back to you now. >> sri, lovely seeing you again. sri jegarajah joining us with the latest out of asia. now, lots of news in the drug sector today. bill ackman is teaming up with valiant to make a bid for allergan. it's worth about $42 billion. the move is unusual for investors who typically buy a

stake in order to force change like a sale. ackman's began building its stake in allergan in february. valeant says it will finalize and announce its proposal soon. the board will evaluate any offer but advises shareholders not to do anything right now. you can see valeant and shares of allergan higher in today's trade. astrazeneca, their shares are soaring in london on reports of an informal takeover offer from american rival pfizer. cnbc understands that pfizer is mulling an offer which values astrazeneca at more than $100 billion. a huge deal. a separate report says that astra has hired morgan stanley and goldman sachs to advise on the potential takeover bid. then you also have the swiss pharmaceutical company novartis unveiling big changes to its portfolio because it's going to be acquiring the oncology division of glaxo smithkline for

$14.5 billion. but it's also selling glaxo smithkline its vaccine unit for $5.25 billion. in a different deal, novartis is selling its animal health division to eli lilly for $5.4 billion. got that? there's a lot going on. cnbc's katherine boyle joins with us more. i wasn't kidding when i said about the diagrams. that's what i did this morning. >> we have to have a tree system going on to understand what's going on in the sector at the minute. if you want to look at the overarching view, i spoke to a chief executive this morning, he said this is farm soot call companies planning for the next 10 to 20 years. there's no point in doing short term, three-year deals. they are looking down the track. if the pfizer/astrazeneca deal ends up happening, and there seems to be skepticism in the market about that at the minute, that will show the return to the

days of the mega merger. for american companies and big pharmaceutical companies are pretty much universally american, it can mean that you can diversify your tax base and potentially make some savings on your tax return by buying an offshore company. >> why would glaxo smithkline choose at this point to pull out of oncology, which essentially is what they would end doing. it's about positioning your pipeline for where you want to be in the future. >> from the glaxo smithkline perspective they want to focus on the vaccines business. they've been trying to work on what to do with consumer health care. it looks as what they have decided to do is keep it within their core business but beef it up through the novartis acquisition. within the vaccines operations there's always the potential to acquire another business. this is area of the pharmaceutical business that seems to keep on going and could do very well in emerging

markets, too. >> i'm still drawing the diagram. thank you, katherine boyle, cnbc participant. thank you. stewart richardson is a partner at rmg wealth management. he johns us nor foot the next half hour in the studio as well. hi, stewart. >> good morning. >> how are you. >> very good. >> back from a long easter weekend. >> very enjoyable. >> what did you do? >> family stuff. has anything changed since last week? >> i don't think a huge am has changed. in terms of the m & a deal, it's always create buzz in the market. if there had been a bid for astrazeneca, that would have been a big deal as you say. >> people think it's going to happen, right? >> clearly the market wants soming to happen. >> within novartis and gsk, change of direction, it's more like a shuffling to the deck of cards to me. each company wants to reorient

itself with the future. i'm not sure how much value we'd see in the short term. it would appear the more mature drugs industry is potentially somewhat undervalued in a low-growth, low-interest rate world. >> in terms of the market, we've very much looking at the low growth high liquidity environment. valuations remain pretty high for most markets. the down side seems to be protected in terms of search for-year-old, continued qe from the fed and so on. but at the same time changing. there was not enough growth in terms of the western world to support valuations longer term. the fed is clearly looking to end qe as soon as it practically can, fourth quarter this year. we've heard from your own guys about qe and japan, ecb seems to

to be able to pull the trigger there. >> is that what you're waiting to are were either new liquidity actually being injected or suns of injection? i mean because it doesn't seem we're seeing profit taking at the moment. i know we've had a volatile couple of weeks recently. it still seems like we are on track for continued march higher in equities if you listen to the majority of people here. >> i think -- the trouble is people need, in the big world, people need to be invested. it's a search for yield. it's just about rising trends in developed markets and yet we know that liquidity is slowly being turned off. i don't think anyone wants to be the first to present bearish. there's not enough bearish feeling for the whole market to be really getting worried what the market isn't anticipating is

the potential risks for there. they are not going up much when you look at year-to-date performances. we're not going down much. the risk in terms of policy from the fed or ecb, escalation on the geopolitical front, which may be more worry between japan and china than ukraine, none of these risks appear to be factor into the market. without these risks coming to bear, markets may be drawing sideways to slightly higher. the risk is liquidity becoming less and less, liquidity injections becoming less and less, the markets will struggle to move higher. it's a fairly balanced market at the moment. everyone is anticipating growth for the u.s. to kick higher. that may happen in q2. the rest of the year we're not so sure. >> you're here for the next hour or so. get your e-mail questions through, your comments through. it would be lovely to include you on the show. worldwide@cnbc.com.

find us on twitter, @louisa bojesen is the direct twitter address that you can reach us at. i'll pose your questions to my guests. let's give you a look at what's on today's agenda. in the united states, though, march existing home sales are out at 10:00 a.m. eastern time, forecaster dropped by 0.7% to an annual rate of just over 4.5 million. it's a busy day for earnings as well. comcast, the parent of cnbc reports results before the opening bell. we get numbers from mcdonald's, travelers, united technologies, bank of new york mellon, harley-davidson, lockheed, zeier rove, amgen, gilead, juniper and yum grands. the automaker will soon name mark fields to replace alan mulally.

fields was appointed coo in 2012 and was previously northern american sales chief. fields hand been assuming more of ford's day-to-day operations, something he talked about with cnbc's phil lebeau just last week. >> i take over some of the bpr meetings and the daily operations of the company. we're all working as one team, staying focused on this record number of launches we have this year, growing the business both here and in international markets. we're not missing a beat. we're staying focused and doing our jobs. >> mulally who entertained the idea of becoming microsoft ceo last year is reportedly expected to explore taking on another high profile position. ford in germany is trading higher by 1.5%. as we were talking about russia could face further sanctions from the white house has rebels in eastern ukraine show no sign of backing down. more of that after the break. more strategy on what you should

be doing with the markets. stay with us here on cnbc's "worldwide exchange."

you're watching "worldwide exchange." >> hi, everybody, welcome back to "worldwide exchange." these are your headlines. shares of astrazeneca soaring on an informal offer from pfizer, reportedly valued at $100 billion. netflix topping earnings forecasts as people flock to

watch original shows like "house of cards." in europe, philips disappoints. just after one disastrous season, manchester united have sacked manager david moise. hi, everybody. welcome back. i'm louisa bojesen. i want to get you up to date on flashes we're getting through on our wires on china mobile being presented via reuters. china's mobile's unaudited key performance indicators for the first quarter of 2014 are coming through. first quarter revenue rising by 7.8%, they say that the quarterly profit attributable to equity shareholders was down by 9.4% over the same period of last year. the average monthly net additional customers for the first quarter exceeded 4.6 million. and that means that the group's total customers reached 781 million. just be aware of that, that coming through on china mobile. now, the white house is threatening to implement further

sanctions against russia, if the kremlin does not publicly call on separatists to vacate government buildings in east ukraine. following the deal struck in geneva, there's been little sign of rebels backing down. the the u.s. revealed images of what it says is russian troops operating in ukraine, a claim moscow denied. this all happening as u.s. vice president biden is set to be in kiev today. bring us up to speed on the latest in ukraine. >> reporter: as you mentioned, vice president biden is meeting with the current acting government in kiev. but the tensions in east ukraine are still high, local people don't people that the kiev government can protect them. they don't believe anyone here is in charge. there is no sign that any of the captured buildings by the militia are going to be vacated.

the militia are still there. on sunday there was a violent shooting that left three local people dead in the town of slovyansk. the first funerals are saying place today. local people are very worried. they don't know what is coming next and if more violence is going to spill out. there are reports that journalists are being captured by militia, held. these are ukrainian, russian and international journalists having the trouble, it seems. so the oce is here on a mission as well. but no one knows what is coming next. >> thank you very much. netflix is on the rise, later on the show, will the online streaming service group release better than expected first quarter results. the details, next. before that, a view of the heat map here in europe to see

how our european markets are trading right now.

hi, everybody, welcome back. you're still watching "worldwide exchange." i'm louisa bojesen. netflix beating forecasts.

morgan brennan has this report. >> it's been a busy first quarter for netflix, the video streaming giant beating the street on the bottom line, reporting earnings of 86 cents per share on revenues of 1.27 billion, in line with expectations. the biggest news coming out of the earnings, price increases for new subscribers, netflix saying it will raise monthly subscriber fees $1 to $2, depending on territory starting this quarter. speaking of subscribers, net subscriber growth strong as the second season of "house of cards" kicked off, adding 2.25 million new viewers in the u.s. and 1.75 million internationally. that was actually better than netflix or analysts anticipated. so the company saying it's on track for profitability in international later this year. right now, though, it's still losing money there. overall, more than 48 million subscribers worldwide. that's a 9% increase over last

quarter. last week, on the earnings web cast, netflix ceo reed hastings coming out against a proposed comcast/time warner cable merger saying he's concerned that such a deal would give the combined company control of internet in half of all u.s. homes. back to you. >> here in europe, shares of philips have been taking a big tumble as the company kicks off european earnings season by posting a better-than-expected drop in quarterly profits. speaking first to "squawk box" earlier, the ceo toll us he remains concerned about emerging markets. >> when we talk about less momentum in the market, it is actually a china that has slowed down. we see the situation in russia affecting our business and then there are many smaller countries that are under pressure that have volatile currencies. europe is, i think, fully

bottomed out. we saw upticks in the southern european countries which is giving us confidence. but at the same time, the northern european countries are not yet getting into second gear. so europe is still flat for us. >> well, stewart richardson is still with us, partner at rmg wealth management. do you think the chinese debt story is going to come back to haunt us? are you concerned about the slowdowns seen in the chinese economy? >> i think this is one of the potential risks which i was talking about earlier in terms of if there's going to be a policy error, it would be china's response to the slowdown which is clearly parent from the last week's data. at the same time, we do have incredible increase in debt in the last five or six years. we're beginning to see the onset of the debt default cycle in china. for the first time they're beginning to let companies default on bonds or trust products, et cetera. there's a huge raft of

maturities in that area during q2 and the rest of the year. we'll see this as an ongoing potential flash point in emerging markets in china. it will be a potential rollover of debt which may or may not go through smoothly. behind a lot of debt, on the asset debt is the property growth market. prices are coming down in tier three and four cities. with the collateral beginning to be questioned again, there could be a real problem for the chinese authorities to try and hand as they try and re-engineer the economy away from fixed asset growth towards the domestic consumption. it's a huge thing for them to have to achieve. they may do it. this is one of the biggest risks in markets in our opinion. >> it's been nice having you in the studio. thank you very much.

>> thank you. >> partner at rmg wealth management. we'll leave you with a look at how the futures are trading on wall street. still a couple hours away. early day, nice to set yourself up for what is potentially to come. we'll see you in a second here on "worldwide exchange."

hi, everybody. welcome. you're watching "worldwide exchange." i'm louisa bojesen. these are your headlines from

around the world. drug deals, shares of astrazeneca soaring on an informal offer from u.s. rival pfizer. glaxo smithkline also on the rise after announcing a deal with novartis for its consumer business. netflix topping earnings forecast as people flock to watch original shows like "house of cards." the company also taking a swipe at the proposed mega merger between comcast and time warner cable. philips posting an expected drop in quarterly profits. the ceo tells us he's more optimistic about europe. >> when we talk about less momentum in the market, it is china that has slowed down. we see the situation in russia affecting our business. europe is, i think, fully bottomed out. you're watching "worldwide exchange," bringing you business news from around the globe. >> hi, everybody.

welcome back to work. many of you having a long easter weekend off. hope you are bright and bushy tailed today, ready to get in on the action we are seeing this morning. many of you already have by the looks of things we looking at the big drug announcements we've been talking about. u.s. futures, we're shaping up relatively for a flat open. europe, playing catch up in today's session. we recall higher on our european markets and we've been hanging on to that slightly higher trade here in europe this morning. the ftse mib reversing earlier losses, trading just a hair, a witness kerr higher. the cac 40 off by a tad, the xetra dax down by 1% and the ftse 100 lower by shy of 1% as well. when it comes to the asian markets in the overnight session, you saw a little bit of a mixed story with the nikkei off over there in the corner by 0.8%, the kospi, the shanghai

composite and the sapp&p/asx hir as well. the pboc says that the move does not mean a change to its current wider policy stance. how do you make money, though, in these markets? we keep asking this question. this is what some of the experts have been telling us it morning. >> it's been astonishing, the continued momentum behind this compression story. you wonder what will come along that might upset the apple cart. one thing that might do this would be a downside shock to the growth outlook. i don't think it's likely that we'll see anything to the pmi numbers but if we see big downside prices, that could begin to unsettle this.

>> clearly the ruble is at risk if we're talking about emerging market currencies. in g-10 space, what we've seen typically is the dollar/yen will trade lower. there are downside risks were we to see a significant flare-up in the conflict. if the rhetoric from the u.s. does get a lot more -- if it's ratcheted up in the next two days, we could see dollar/yen low. >> that has died away. what you're finding is relative value. we are talking about commodities, supply and demand balances. this seems to be going back away from risk on, risk off, back to the old ways of analyzing things where you think the sector is undervalued. that thought process, i think is very positive for the market.

well, weibo shares have risen 33% above the ipo price of $17 since its debut on the nasdaq last thursday. were the shares priced too low? susan lee caught up with the company's chairman, charles chow, and asked him why the offer price was lower than what many had thought. >> from behindsight it was priced a little bit low. if you look at the mark net the last two weeks it was very tough. take a look at all the ipos in the market the last two weeks. most of the ipo were priced below the range. most ipos traded below the ipo price. we were lucky enough to -- price was in the range and traded up after that. so i think we're doing okay. >> joining me from chicago now is joseph shuster, founder of ipoc shuster. what's your take on the ipo market? do you think we'll continue to see this type of momentum continuing over the next couple of weeks or are we going to

start to say the lofty levels are too lofty at the moment? >> i think the ipo pricing sentiment to market is becoming kind of selective, small deals in specialty industries like technology, health care, energy, are well in demand but surprising sentiment for lather deals is going to be more difficult down the road. that's reflect ed that weibo is priced way below initial range and other larger ipos have done so as well. >> do you think that the u.s. now is the default market to ipo in? the actual ipos and success they're having, a lot of them are nasdaq listings. >> maybe well true, especially in technology. alibaba is coming to the u.s. but the european ipo market has recovered very well. a lot of deals out of london on

the continent as well, japan is coming back, more difficulty in hong kong. the really big deal, the significant deals in terms of generational growth opportunity, they're going to happen in the u.s. no matter what. >> you mentioned alibaba. alibaba continuing to generate buzz ahead of its much-anticipated ipo. what exactly is the e-commerce giant about and how big is it? josh lipton breaks it down. >> in only 15 years it's exploded from an idea to an e-commerce powerhouse, responsible for hthe half parcsl delivered in china.

and more than 60,000 transactions per second. jack ma founded alibaba in 1999. now he's prepared to take the country public. alibaba is often compared to american e-commerce giants such as amazon. alibaba does not directly sell goods. it operates websites to which consumers buy and sell goods with each other. alibaba then makes money from advertising, which accounts for the bulk of its revenue. in the final quarter of 2013, alibaba generated revenue of $3.1 billion, a 6% jump year-over-year on the top line. analysts at cantor fitzgerald peg its valuation at $184 billion. for investors, alibaba offers exposure to the chinese e-commerce market. by 2020 that market is expected to be bigger than the u.s., britain, japan, germany and france combined. josh lipton, cnbc, silicon valley. this would be huge, joseph, absolutely huge. what are your expectations for alibaba? >> obviously fundamentals are improving substantially into the ipo of what we would expect from any deals like that. so revelations in the market

plays now are between 150 billion and $200 billion. in our opinion, valuation should be slightly lower given the default risk of ipos in general. other ipos should trade sat a discount to u.s. domiciled ipos. the company needs to leave some money on the table for the institutional investors which are required for the deal. it's a large deal, up to $15 billion. obviously for this kind of money you need very large investors and large investors shared their facebook experience, bought into the offering the ipo price, to see the stock tank in the after-market. that's what alibaba wants to avoid. >> alibaba doesn't actually sell

goods, they operate websites where you can buy and sell goods through. how susceptible is alibaba to a potential slowdown in the macro environment? >> obviously, it is susceptible but there's a generational opportunity growth there. just like casinos in macao and so forth. on average, as the economy goes up and down, alibaba is likely going to grow nevertheless. that sets excitement about the stock and that's where potentially very large valuations can come from. >> joseph shuster, founder of ipox shuster, we appreciate it. now back to some of the top stories we've been following. ford's annual meeting happening on may 8th. fields was appointed coo back in december of 2012 and was

previously northern american sales chief. he's long been seen as mulally's successor. he talked about this with cnbc's phil lebeau last week. >> i take over some of the bpr meetings and the running of the daily operations of the company. but we're all working as one team and staying very focused on this record number of launches that we have this year, growing the business, both here and in international markets. so we're not missing a beat. we're staying focused and doing our jobs. >> mulally who entertained the idea of becoming microsoft's ceo is expected to take on another high-profile position as well. ford higher by 1.5% in german trade today. it's one of those songs you can't get out of your head, "it's a small world."

50 years ago disney unveiled the it's a small world after all ride. disney hosted a 24-hour around the world sing along at all of its theme parks. much to the delight of many, many, many parents. for those of us who are still children at heart. right? still to come here on the show, our mega mergers set to make a comeback in pharmas? we'll be talking takeovers on both sides of the atlantic. let's next. tweet us directly @louisa bojesen. good to have your company this morning. see you in a second.

you're watching "worldwide exchange." >> hi, everyone, you are indeed. shares of astrazeneca soaring on an informal offer from u.s. rival pfizer, reportedly valued at $100 billion. netflix topping earnings forecast as people flock to watch original shows like house of cards in europe. philips disappointing. after just one disastrous season, manchester united have sacked manager david moise. now we've had a flurry of m & a activity in the drug

sector today on both sides of the atlantic. we go to the cnbc hq. we're trading higher, getting a nice boost. >> let's start in europe as novartis unveils a major overhaul. they are buying glaxo smithkline's oncology unit for $14.5 billion. novartis is selling its vaccines business to british drugmaker for $5.25 billion, both deals include milestone payments that could raise the total values. novartis and glaxo plan to combine their consumer divisions in a joint venture. glaxo will own 63% of venture which will be one of the world's largest with nearly $11 billion in annual revenue. the deal's fundamentally reshape novartis, bringing it higher, margin products such as cancer

drugs. separately, novartis will sell its animal health division to eli lilly for $5.4 billion and is also looking to sell its flu business, checking shares of novartis, glaxo and lilly, all higher on the day. a programming note, sir andrew witty will be on "squawk box" at 6:40 a.m. eastern and john lickliter will follow at 7:15. allergan has a market cap of $42 billion. a deal would combine two midsize drugmakers with expertise in skin and eye care products. allergan is larger by revenue generating $6.3 billion last year while valaent reported $6.5 billion in sales.

ackman's firm began buying allergan shares in february, spending about $4 billion. its biggest investment ever. it now has a 9.7% stake in the company. in a filing, ackman says valeant will pay with a combination of stock and cash and expects the cash component to be about $15 billion. valeant has been on a buying spree, most recently acquiring bosch and loam. valeant higher been 13%. in other corporate news, china mobile has reported first quarter numbers. the firm says that net profits in the period fell by 9.5% to

its lowest level seen in five years. china mobile is suffering from an explosion in online messaging and call service which allow mobile users to make calls and send messages without incurring additional charges. china mobile is the biggest mobile carrier by subscribers. the fate of one south american country's finances could be in the hands of the u.s. supreme court as the high court could rule this summer on a dispute between argentina and one of its long-time bond holders. cnbc's kate kelly was at the supreme court and files this report from washington. i'm standing outside the u.s. supreme court in washington, d.c. where the nine justices heard arguments today in a now infamous case at least in the world of finance which is to say argentina versus nml capital. the issue at stake here is whether or not elliott can pursue assets that the government of argentina may own

outside of the u.s., for example, seizing a ship or piece of land they may own in a foreign country in an attempt to eventually be paid back on their bonds. there's a long history behind this case, dating from 2001 when argentina defaulted on its debts. it was the largest default in global history at the time. elliott sued argentina for repayment while other bond holders took a restructuring deal for a quarter to 30 cents on the dollar. elliott was trying to seize assets, including a naval vessel docked on the waters of ghana off the coast of africa. fast forward today. the justices heard about whether the foreign sovereign immunities act applies here. that protects countries from having assets seized in cases like this. these particulars have never been looked at in this court. especially, argentina, whether they should be able to rely on it nonetheless in a case like this. we'll hear more about this in

june when the justices are expected to issue an opinion and also we may find out that month whether they'll take up a larger case about the lawfulness of the payback itself. back to you. now, in sports news, manchester united soccer club have sacked david moise after one season as manager. moise was hand picked by his predecessor alex ferguson but the team failed to secure a spot in next season's lucrative champions league. now, we want to know, is shareholder pressure unhealthy for the long-term success of sports clubs? how long should a new coach get to prove his worth? jeff tweets in to say its hard for moise or anyone to meetly foll -- immediately follow a legend, he's referring to sir alex ferguson. do you agree? if you want to join the conversation, get in touch by e-mail @worldwide,

worldwidworldwide worldwide@cnbc.com. the chosen one was a description that jose marino gave to himself. it wasn't david moise. he said helia should know that since she's a chelsea fan. there we go. keep e-mails coming through, tweets coming through as well, @louisa bojesen. see you in just a minute.

hi, everyone. welcome back. u.s. futures indicating relatively flattish open state side this afternoon. we still have a couple hours to go. europe was being called a little bit heighter this morning. joining us now, president of

traders audio.com. again, good as usual to see you. we're coming back from a long easter weekend here in europe. we have earnings to look forward to in the u.s. today. >> we have over a third -- roughly about a third of the s&p 500 scheduled to report first quarter earnings. you know, again, we did have kind of a quiet trading day yesterday. the focus is on the earnings. ahead next week to the fomc, netflix coming out, surging higher yesterday. up 22 after surging earnings, again, a big day to the upside there. expected to see continuation for the most part. we've been watching this divergent type activity that's developing. laggers right now are the russell and the nasdaq. so that's going to resolve itself one way or the other. you have to give the benefit of the doubt to the bulls at this point until we see significant

pullback, this market right now continues to seek higher highs and higher lows. >> what do you think is going to happen in the slightly longer term when looking at the whole selling man go away and stay away for a couple of months? is that going to happen this year as well? >> well, that's a great question. everybody's been kind of predicting that for years right now at this point. it really has yet to develop. i think you have to focus on the areas of value that this market has been establishing on the way up. those have been the same significant areas we have been looking at on the way down. i'm not looking at that or considering that type of activity at this point. again, this market's been so strong to the upside right now, you know, we have significant areas that are in place before we would start to talk about downside activity, they'd need to take those areas out. >> good seeing you. have a lovely morning. president of tradersaudio.com. >> thank you.

"squawk box" is next. see you later.

good morning and welcome to "squawk box." novartis doing some buying and selling. the couple of different big partners. it's all part of a major restructuring. netflix tops expectations and a price hike is on the way. reed hastings has more to say about the comcast/time warner deal and ford's alan mulally may be about to step down as ceo of the automaker. mark fields is next in line. it is tuesday, april 22nd, 2014. "squawk box" begins right now.

good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen. andrew is off this week. novartis announcing a majoring restructuring including several mega deals. it will be paying glaxo smithkline $14.5 billion for glaxo's cancer drug business. the price tag on that transaction could rise to $16 billion if certain development milestones are met. novartis is also selling its vaccine business to glaxo for $5.3 billion. that price tag could rise to $7 billion depending on milestone payments as well. glaxo and novartis are combining consumer units in a join the venture. in a separate deal, novartis is selling its animal health division to eli lilly to $5.4 billion. ceo joseph jimenez says these deal will improve the financial strength and add