prompted it to release earnings early. u.s. regulators slap a record $105 million fine on lapses in safety in relation to recalls. and welcome, everyone to the show. you are watching "worldwide exchange." just getting data out. the german euro dollar climate number has come out at 1.08 keep in mind expecting to stay unchanged in june. a lot of it having do with how

the greece story would play out. we did see a significant head line in the index in the month of june coming in at 1.074. coming in at 1.08 against expectation. we're looking at highs of 1.11 against the u.s. dollar. let's get reaction from bill o'neal from ubs wealth management. from the headline number bill this number looks pretty good? >> yeah i think it's provide something reassurance that a multidollar recovery is still under way in europe. i think the weakness of the euro posed the greek settlement that played a role here. clearly that to be reflected in green coming through the market for the midyear as well. but i think it's important that the market was to have some nasty surprises after some pmi number, purchase managing

numbers, of course that did disappoint. >> we should point out that the ifo has said their june expectations has been revised up to 0.121. it's also a two-week i after the ifo. i guess the question is what does it mean for the exporters out there who have been benefitting from the weaker currency this year? >> well i think it's clearly important for the market. from the point of view the earnings story. the analysts are looking for evidence of organic growth. but this is important in sense of a balanced recovery against europe. you one that incorporates both the core and the periphery. and that's what we've been seeing. it's not a spectacular recovery in terms of pace but it's steady and reassuring. >> just when we thought the fundamentals would be driving prices. once again, china guiding the

discussion would you agree? >> yes, especially china, having an impact you're seeing the influence of that in world trade as well. what we've been seeing recently is the services sector vis-a-vis, the manufacturing sector, doing relatively better. >> thank you for that. bill stick with us i want to get your thoughts what's happening in asia. because heavy losses in china's air share with the shanghai composite boasting it's biggest drop since 2007. energy stocks among the worst performing with china oilfield services off 10%. more live in singapore with the latest. sharia what's the big catalyst on the downside? >> well there seem to be two factor seema. one is there's a sector that seems to be suggesting that beijing is starting to step away

from the market in terms of its support. and the backstop that we saw at the height of the volatility, remember in july over the course of july really especially and into june as well. so there's a asense that the government is trying to test the waters here. 4,150 was being touted as an unofficial bailout target. at that point, it seems that the government -- we crossed it by the way, last week in intergovernment trading. at that time trying to test the market's recovery from the lows are self-sustaining and clearly it was premature to do so. they got a hint that the government was starting to step away and we saw cataclysmic declines. and there's evidence that the economy is falling with the profitability numbers for the month of june. contraction 0.3%. so this reverses the expansion that we saw in the prior two

months leading up to june so concerns still lingering about the state of the broader economy. now, we really have to wait and see whether this is a continuation of the volatility. whether there say second phase of the selling. so the course of this week is really going to be quite important. so that will be testing the market's confidence. is this going to be the opportunity for some of the more -- some of the investors with a stronger appetite to get back into the market to buy some of the large caps that have been beaten down? or is this a case once again catching a falling mark? very quickly, the index heavyweight stock got beaten up china unicom bank of communications. >> the worst day for shanghai. thank you very much. >> let's get ba back to bill o'neal the ubs wealth investment. how much is china a factor?

>> well clearly it's the market and the economy. our sense is the connection with the market with the broader limited. you're talking about participation is 15% of households in the equity market. it's not a big issue in terms funding with corporate. households have got something like $20 trillion in terms of savings. they're huge opposites. i think it is important, in tellers, i suppose in the manner of financing and the whole move to reform and china regulation. it really is a pothole in that story. i think, clearly from the point of view the market the concerns would be other markets whether there is liquidity again would be used as hedges if there were to be portions of trading such as in the markets recently. >> one question from twitter as well as over e-mail does it get worse before it gets better when looking at the chinese markets? >> that's a really different call. i think the backdrop in terms of the economy, i think we're

seeing signs of stability, improvement in the story, the infrastructure spending, some signs show it's beginning to stabilize but i think you can't say it's over yet. >> earnings in focus today as well 3shgs second quarter net profit at ubs jumping 53% beating analysts' expectations this as the swiss bank's wealth management division posted it's best q 2 results. shares are lower amid the equities today. let's get to carolin roth live in zurich. hi carolin. >> good morning, seema. i just looking at goldman sachs, they said this is a mixed result. they point out that the banking business was in line with expectations. investment banking also in line

with very strong equities if you listen to cnbc earlier this morning, he said are we benefitted from trading in china because that's where they're very strong. so someone is benefitting from all that volatility we're seeing in the chinese markets these days. and then of course another positive pointed out by goldman sachs is the very strong capital levels. 14.122% under basel3. seema, on the downside goldman sachs points out that the private banking margin actually fell. it's now at 82 basis points and we saw a miss in the corporate center but as you pointed out, numbers were released one day early. he talks about why it happened. >> we wanted to bring some transparency and also address some incorrect information that was reported yesterday in the swiss media.

and since we were prepared to go at it we thought it was within the best interest of all stockholds to get the information out today. >> clarify it for us that report cited an insider. has any member of ubs staff been disciplined, or will they be disciplined as a result of this? and have you managed to confirm that information was actually leaked by an employee? >> there is no basis for coming to such a quick conclusion that the information there is coming from inside. as i mentioned, the media reports were incorrect, misleading and we thought it was sufficient to trigger' release of results a year before. we'll see who was responsible, if anybody was responsible at all. or if even it was just a

speculation. but i think we now move forward. i'm very pleased with the results and we are keeping our focus on the next steps. >> so you will be investigate, i daresay, to try and identify any individual if that was indeed how the information came into the newspapers' hands. let's talk about the second quarter numbers then. you must be quite pleased with the net figure you've delivered to the market this morning. how representative of trading for the rest of the year will this increase have been? >> well i say in the first quarter we should multiply by four. i think the second quarter was more reflective of the seasonality. if you look at the profits in the first pat of the year we're up 70%. i'm confident we are entering the second part of the year with

a good momentum. the seasonality in the third quarter is clearly higher. and if you look at the mac control environment and the geopolitical environment, it's a challenging one. unfortunately, we've been quite accurate in our forecast in the last ten quarters or so but i'm confident that we can deliver to our shareholders and our clients despite that. >> sergio emergency roomeio ermotti speaking to us earlier. the ubs trading up 21.29, up 1.3%. you would expect with a solid report card like that today, shares are going to be trading higher above, in the maelstrom we're seeing in the markets that said it simply cannot avoid that trend. and maybe a little bit of profit taking because year-to-date share, up a nice 25%, seema. >> absolutely a bright spot.

carolin, thank you so much. let's take a look at european equities. how are we faring? right now, european stocks trading decisively lower. stoxx down 1.25%. the ifo economists say temporary relief in mid-july contributed to the brightening of mood. you'll see that we're basically lower across the board, the xetra dax down 1%. the ftse off 0.3%. we're seeing the commodity markets swell the selloff in asia that of course denting sentiment here on monday morning. taking a look at bonds, if investors are selling equities they perhaps are buying bonds be

the ten-year at 2.5%. german ten-year at 0.69%. the lowest since february. and a quick look at the ten-year at 1.9. the dollar was mixed in the past week against commodities against currencies such as the aussie dollar and the canadian dollar. you can see the euro though, at a two-week high against the u.s. dollar after we got that better than expected ifo data. all right. let's talk comphod eyemodities because it was a big week. wti crude oil falling and breaking below $50 a barrel. gold also in the lime light now down for the fifth straight week losing more than 3% in trading below 1,100 last week which is a key psychological level. and spot gold let's keep an eye

on now up 5 bucks on the day. bill o'neil from ubs management still with us bill we're looking at the german dax of 15%. french markets up about 18%. the ftse european market up 0.2% why is that? >> it sort of broadened in the uk against the performance, not simply down against the commodity, clearly energy as well. those do account for 25% of the earnings base in the market. and earnings up 8% year to date in trade index. it's clearly less impressive because of the dollar but the euro is having an impact as well. the relevant of it is an outstanding case of valuation, the weakness in earnings has affected the weakness in the market. >> the npc meeting last week suggests that policymakers are becoming increasingly worried

and how that could have a negative impact on gdp. do you think that will play out this week? >> well i think it's an influence. it's not the only thing. the feeling at the moment it's supporting, it's supporting real earnings. and therefore supporting consumption. the other part of the story is is that for now, the banks seem to be more focused on leading indicators of inflation around wages. the wages productivity story is rather more significant rather than impact in terms of inflation. >> and it's on stat for, bill which is what you can use as well are you ready? three months from the polling date from the july mpc meeting, the effective rate has gone to 4%. where does it go from here? >> well it's had pressure typically before the election. i suppose the election resolved in the way the market had had anticipated a great deal.

but the big story here is the consistency, the recovery. after having a bit of a wobble this week from the uk likely to see 0.7% in the quarter. >> and the question is if the boe raises rates before the fed? >> we're expecting it to move in september, the mpc to move in november. two moves this year. >> lastly what are you expect for the fed policy? >> i think this is very interesting, there's no forecast, in terms of there's no press conference. but the language will be looking for any hint there's an imminent rate hike on the way. this is the last big statement before the possibility of a september rate hike. >> of course a big week. we're not only watching the volatility in china, but uk numbers. it's a busy week. add to that earnings which, of course, is keeping things

interest for us bill o'neal head of ubs office. asia markets walllow in the red. see what looms for a central bank meeting. that's after this break. more and more, data is visual. in fact, the number of mris has increased by ten percent a year. and a radiologist might view a thousand images to find one tiny abnormality in shape, contrast or movement. because it's so challenging a research project is teaching ibm watson to see. in the future, it could help clinicians spot key patterns quickly and precisely. ibm watson is working to make healthcare smarter every day.

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welcome back. let's give you a rundown of what to watch this week. today, we'll get durable goods number. and earnings from nor fok southern and twitter and facebook earnings will steal a spotlight later in the week. all eyes on the fed wednesday after it releases a statement after a two-day meeting with investors looking for some clues on the timing of a rate hike. one of them could be more anticipated than that is the release of second quarter gdp on thursday. economists are predicting a 2.7% rise after a contraction in last quarter. the data will also include annual revisions going back to 2012. a quick look at european. policymakers saying restructuring debt and also saying prepare for unprecedented

financial solidarity towards greece. there's statements coming in from ecb's benoit courier. they're looking at what it will look like this week when it comes out at a that. do you think that negotiations will go well this week? >> i think it will be tough, i think it will be tough to meet the deadline which seems to be the key talk at the moment. and to sign off on a medicalmorandum of understanding will be difficult. with the action with the set of reforms particularly with the implementation to be basically demanded of the greek parliament. three things to remember three parts, the budget targets, the process of the reform commitment and then the debt relief.

those three elements in october are going to be keys. clearly a huge area for dissension. >> there are some who say this is not enough. including christine lagarde saying the bailout won't be enough to help greece's economy? >> well, we don't because this seems to be again, just a moving target. what we can see there's going to be large sums of money required in terms of the banking organization. it may be that the targets are adjusted. but it's really -- people talk about the direction of travel. it's about things like commitment of the government in athens to implement and to own the program. and we're steering considerably away from that. >> you think it's important to see debt relief measures versus maturity sanctions? >> well i think it's maturity sanctions. >> a quick word on german stocks right now, the xetra dax down 1

superiors. this after a 4% move to the downjied lastdown downside last week. would you buy on the dip here? >> yeah the favored market is germany. the valuations are appealing. and we think the economy is going strong. and in general, 13%, 14%, 10% extra. >> but the stronger euro perhaps, makes the german exporters less attractive? >> it's a stabilizer in germany. the global story, even including the picture on the emerging markets beginning to show little sign of strength as they recover in the second half of the year. and that's important. it's the final demand story in these economies not just the causation. >> betting on the second half. i can't tell you how many investors say that. bill o'neal head of ubs at wealth management. moving on to politics,

despite a flurry of controversial comments business mogul donald trump continues to sit on top. meanwhile, hillary clinton holds a comfortable lead in the mail. nbc's kristen welker has the latest from iowa. >> there's a movement going on. and it's a very strong movement. >> reporter: donald trump known for his brash style and controversial comments is surging according to the latest nbc poll. he packs ace 7% lead own jeb bush. in i, was he's just two points behind scott walker but 44% of iowa's republican voters view him unfavorably. that number jumps to 53% in new hampshire. >> i believe in what we're doing and what we have to do. >> reporter: and today, democratic front-runner hillary clinton again tried to turn the page away from her e-mails and back to policies. >> we need to have a democratic president in the white house. >> reporter: but on saturday she was forced to defend the use

of a private e-mail account when she was secretary of state. >> secretary clinton, doesn't the fact that we're having this debate underscore the fundamental problem with using a private e-mail server while you were secretary of state? >> not at all. no, no this would be the same debate if it were -- the vast majority of everything i sent and received was already on the state department system. the unclassified state department system. >> reporter: the new marist poll showing the flap could be taking a poll topping bernie points by 13% in new hampshire 20% of iowa's democrat voters view her unfavorably. and that number gets even higher in new hampshire, 23%. to what extent do you think that would hurt secretary clinton in the general election? >> i think republicans, it would hurt her a lot. >> i don't see it hurting her a lot. >> reporter: trump set his sights squarely on his

republican challengers. >> i'm thinking about a man who is in favor on common core a man who is weak on legislation. jeb bush. a guy like walker who frankly in state is having tremendous -- >> reporter: meanwhile, clinton ignored a chance to make a swipe at him. >> do you want to comment on donald trump? >> he will hold talks before addressing the african union tuesday. he told the president he needed to address his country's human rights record. in a point press conference the u.s. president said kenya could succeed that warn bad things happen that treats states differently when they're not doing harm. >> i've been consistent all across africa on this. i believe in the principle of

treating people equally under the law. and that they're deserving of equal protection under the law. and that the state should not discriminate against people based on their sexual orientation. and i say that recognizing that there maybe people who have different religious or cultural beliefs. but the issue is how does the state operate relative to people? >> still to come on "worldwide exchange" -- ryanair's ceo say airlines should display each other's prices. so is this the beginning to the end for comparison websites? we'll discuss right after this break.

you're watching "worldwide exchange." chinese stocks plummet in the biggest one-day drop in eight years. investors left scratching their heads with more weak data. the euro hits a two-week high on an upbeat ifo survey. but china looks for a boost to exports. ubs gets caught up in the market despite a surprisingly huge beat in the second quarter profit, the swiss bank is investigating a newspaper report that prompted to release earnings early.

fiat shares moving down in italy after u.s. regulators slap a $105 million fine on the automaker overlapses in safety in relation to recall. chinese stockings getting obliterated again. shanghai composite seeing its worst day since 2007. some were thinking, you know what, maybe the volatility is over. over the last two weeks we have of course, seen some stability in asian markets. shanghai deposit losing 8.5% in today's trade. the similar story for the shanghai composite. and hang seng triple digits down by 1%. we will get that better than expected ifo number. traders perhaps getting their cues from asia. the xetra dax down 0.9%.

french markets down 50 points. and the ftse 100 flat on the day down two points. stocks specific news. fiat chrysler is being fined a record $105 million by u.s. regulators over safety lapses. let's get out to claudia out to the line. >> this is the largest fine since honda motor was fined in january of this year $70 million. now, this fine that is as you said, $105 million, is made up of $70 million in pure fine. another 20 but they need to invest to improve how they are addressing these issues of these recalls. the recalls that are being watched here are 23 recalls that regard $11 million jeep cherokees and liberties and models ranging from 1993 to 2007. another 15 million would be charged if they were in

violation of the consent order. so they really need to move forward on the timing and how they're handling these recalls. these recalls regarded fuel tank issues loss of steering controls. sudden shutdowns. this, of course comes amidst a crackdown on safety. and automakers will have seen lots of recalls coming through. the slow response, the insufficient response has led to the national highway traffic safety administration is cracking down on it and that has prompted this fine. just to note also that friday fca also announce they're recalling another 1.4 million vehicles, this due to the possibility of hackers being able to take control of the vehicle. this would be the first in its kind where issues of hacking the systems within these vehicles is coming under scrutiny. so, certainly affecting the stock here this morning. we are seeing down by over 2%

points. the worst here on the italian market. we're watching what kind of effect that will have long term also in regards to costs. another stock we're watching israeli pharmaceuticals, teva. acquiring allergen for $40.5 billion. they're seeing savings and teva also says upon closing the deal it will receive 33.75 billion cash shares in teva. they hope this deal will be significantly credited to nongap earnings including double-digit accretion in 2016. you there go confirmation there

it that teva is acquiring allergan for a multibillion deal in the health care space. shares of ryanair trading lower after with the guidance after the irish airline projected 2015 profits in the upper end of the range and increasing traffic by 3 million. joining me on the phone from dublin is stephen furlong at db stockbrokers. stephen, this seems to be a good report but the stock is down 3%. why do you think that is? >> hi. it's early in their financial year so typically, they don't tend to change or materially change their guidance at this time of year. so i think we'll have to wait a little longer and see how the bookings and yields are particularly in the peak summer and later on in the year. >> using some of profits to improve fares could this

negative affect profits going forward? >> i think the peak summer is very important for ryanair, as you say, it looks it's like going to be very good. so i think that's going to be very good for full-year profits in that terms of winter they're certainly going to add a lot of capacity. and grow traffic 15%. they built that growth rate from 10% to 15%. i would say that's going to put a lot of pressure on the overall fares. shares are going down over the winter. the fares are going to be down from minus 4 to minus 9. >> up 80% over the past four month, what are the catalysts here? >> for example there's an agm in september. and the cash generation of the company is fantastic. but in addition to that they're going to get probably another

400 million from the airling sale. and the peak number reporting season will be in november. so that's usually a strong period for the stock. hist to beically the stock has done very well in the back end of the year. >> oil prices is supposed to be good for airlines all the airlines. the question has the recent price in energy actually going to benefit ryanair as bottom line going forward? >> this year they're 90% hedge at 910 which would be above the market per metric ton which is $95 a barrel. next year they just announced that they're 70% hedged at 657. meaning there's a 250 savings next year. they have a huge benefit in them as they go into the following year with lower oil prices.

and this will be likely ahead of the market. so ryanair's competitive position is going to be extremely strong as you look into next year. >> what's your top pick in the airline index, stephen? >> for me it's ryanair and longhold aeg. >> there you go. and trading at the top of the stocks index. the dutch electronics company says the increase was driven by sales growth in its health care unit and margeal improvements in consumer and lighting business. shares of valeo, despite a record intake of 10.7 billion you're flows the first half of 2014. let's get the full story with stephon in paris. >> good morning, seema. the numbers are quite strong

actually, 54% rise in profits in asia and the united states. sales were boosted by huge savings in driving assistance technologies. and after they decided to raise the guidance for the vehicles and the improvement in the margins for the second half of this year better than 2.4% reported for the first time. that's a slight increase over the 2% margin for the last year. the forecast is based on a 2% to 3% in the global volatility of the automobile market this year. that's based on a 4% to 5% expansion this year in europe and this year in china. even the ceo said it was concerned about the slowdown in china. >> what we're seeing in the market is increasing in europe. is stable in north america. and we're always concerned about

china which is slowing down. it's clear that the first quarter was 1% up. the second quarter was 3% up. and the growth number is very stable. >> and the performance in china, as the company makes 25% of its revenue out of the chinese market. a significant slowdown in this country could delay the outlook for valeo. that's the reason why the stock is the biggest performer in the cac despite the numbers we have for the first half. off by more than 2%. it was down more than 4% after the start of trading this morning. society situation is improving a little bit. >> stephon, thank you so much. all right. moving on two turkish soldiers were killed and a four injured in a roadside bombing sunday in southeast turkey. this after turkish fighters

bombed camps. the strikes with the peace efforts put into place with the kurdish party in 2012. the white house says it welcomes turkey's efforts to fight islamic state with the ppk. and clashes erupted after a suicide bombing in a city that killed over 30 people and wounded 100. police used water cannons and tear gas to break up crowds. officials believe islamic state was responsible. moving on, the turkish lira faces problems. the turkish lira is one of the number of prominent currencies to significantly weaken within the last week. let's get the forecast with the

managing director of credit research. where do you see the market here, given the instability that we're seeing over the weekend? >> i think it's on the downside definitely for the turkish lira. one managing to get the coalition government the 23rd of august. after that it will be clear, i think what's going to be important, the fed hiking rates. although i think a lot is in the price, the turkish lira is definitely one of the smaller ones in terms of volatilities. >> like fed policy? >> absolutely. but also in terms of the current deficit and the instability. >> what's the focus of china? shanghai deposit closing by 8.5%. how does this volatility in the chinese markets how does that

impact the market if at all? >> well it doesn't impact it in terms of volatility. having said that i think it's mostly relevant for commodities. i think on the whole, what's been happening in china, first of all, all the chinese want too fast too much. right now, we're in a period of investors are seeing stocks with the effects of the stocks filtering and we haven't seen that yet. >> the aussie dollar a proxy in chinese growth. where do you see the aussie dollar going from here? >> it's very difficult. right at the moment i'd like to stay on the sidelines as far as dmod this commodities go. one thing, a lot is in the price both in terms of the chinese, as well as commodity prices going

down. at the same time it's hard to get excited about commodity currency. >> would you buy the chinese currency purely on the bet that the pboc will continue to buy policies stimulating china's economy? >> no i think in the more striking scenario we're going to see marginal increase in volatility over the next few months. i think it will be a nod to the imf that the pboc is moving towards a more flexible change. and that's important for the inclusion. >> what kind of reaction are you expecting from emerging market currencies once we hear from janet yellen this week? >> well it's a very interesting question. i think yellen has said a lot over the past couple of weeks. so i don't really anticipate that it's going to provide us

with fresh news over what we already know. so what we know so far is that the fed rate hike is getting close. i don't think it's going to be so much of a matter of whether it's going to september or december. right now, we have to in fact have a price in for this year. so, on the back of it i just doubt that we're going to see significant moves following the fmc statement on wednesday. >> i'd also acknowledge that a lot of these currencies are no longer moving on policy but domestic news? >> that's a global story. up until the end, as we call it of the superstrong dollar rally which ended somewhere around march and april of this year. since then specifics have moved currency. >> the japanese are seen as a defensive play in the currency market but today, it's been

moving lower. data on producer prices in japan seem to be pushing the yen even lower. what are your thoughts on the japanese yen going forward? >> it's a very difficult one, because the yen is one of these currencies where it may do nothing for a certain period of time and then move on upwardly. as far as japan is concerned, because i think by far now, this is the most important factor for the yen going forward. i'm still not convinced that it will manage to hit the targets that it had set by 2016. so i still think the race for the yen to be on the upside. >> thank you so much. moving on shares in berlin entertainment suffer their biggest ever daily fall after a profit warning. this following a roller coaster crash at its uk theme park alton towers at the begins of union. merlin is warning the costs will

have an adverse effect. down 3.5%. still to come on "worldwide exchange" -- take your pick, greece, china, the dollar the fed. 2015 has been full of obstacles to trip up hedge funds but what's the road like ahead? we're going to discuss that. don't go away. value leo.

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welcome back. teva has reported to acquire allergan for $40 billion. it's withdrawn its proposal to buy marlin. shares in teva opening up to 6% in trade. brent saunders will join "squawk box," 6:30 a.m. eastern. you won't want to miss it. in the meantime we've actually been receiving earnings from teva pharmaceutical the numbers, the second quarter revenue at $4.97 billion. adjusted second quarter earnings of $1.43. and of course the big news though, they're buying allergan

for that mega amount. over 40 billion. we'll see how the stock performs up 6% in premarket trade. around deutsch b "o." rse to buy for ex for $725 million. in other news mcgraw hill financial is in talks with virginia-based intelligence services snl financial. this according to reports. the deal which sources say could be announced as early as monday values the target at more than $2 billion. snl financial is currently 60% owned by a private equity firm new mountain capital. an update on greece. grease to be capital on the stock exchange yep, as early as morning.

saying that boerse was waiting for signoff on counsel from the european bank. capital controls are likely to be in place, as they wait for a cash injection from europe. expect some updates this week. meantime greece's near exit from the eurozone caused alarm from hedge funds which had exposure to the country's debt. our next guest says however there are few positive takeaways. let's get it from anthony lower. >> good morning, i think the big issue is the unguarantee around greece is what was holding it back. betting high on greece wasn't a lot of high-quality bet. so there wasn't a lot of exposure betting one way or other. but people are holding back their explosionosure.

we need to come to a greek compromise in roughly the next four weeks. what we're seeing is hedge funds taking their european exposure back up. you've seen including last week's selloff, the european equities still positive. so yes, there's opportunity, looking at growth in europe as opposed to the specific greek situation. so the fact that uncertainty has receded is what brings opportunity. >> it's receded but is greece seen as one of the top risk markets? >> as a headline risk definitely. but really what people are looking for is a lower uncertainty. and i think that people believe now that greece will stay part of the euro. and so they're more comfortable putting exposures back on. when you look at the data in europe german unemployment levels spain unemployment trend, consumer credit those are all positive right now. so the fundamental story in

europe is positive. people want to put money to work. so, this decrease in the focus on greece say good thing. >> is that primarily because there is a thinking that the ecb will absorb any economic shock associated with a greek exit? >> there's no clarity on that yet. that's all to be negotiated in the coming weeks. the belief though is that europe will find a solution and muddle-through solution, if you like extending maturities allows greece to hold off on interest rate payments et cetera. >> let's pivot the discussion to asia. once again chinese stocks selling off. how much are hedge funds suffering from this recent volatility in china? >> so extreme volatility really. including today, a big selloff today. most hedge funds have lower exposure to china. those who have been hurt the same for greece are those there are the "a" shares in china or

the greek exchange both of which closed for a period of time. in china, we actually see great opportunities especially in trading in hong kong, and hong kong-related china related names. pes about six times in an economy that's going at 7%. even at a lower growth the 7:00%, those are very attractive. we think if you can hold through the volatility especially if you're buying in hong kong we see good opportunity as well. we wouldn't disagree with the statement from bridgewater that asia that the chinese market is almost untradeable at this point so that you have to have patience of capital to live through that volatility or trade in hong kong. >> it's interesting you bring up valuations most say incredibly lofty valuations especially when you look at the tech sector trading at 50 times the average

pe. i guess you're saying you need to look at specific sectors within china to figure out whether to get in? >> absolutely. i think that global applies particularly to today. i think it's being more difficult to be long in the market. chinese equities those have all moved. european and chinese equities up 15% year to date. dollar about 7% stronger. year to date. to now say those are good quality is much more difficult. i think you have to pick your name so we're much more in favor of relative value rather than sector picking. >> anthony, pleasure to have you on. get the hedge funds view on markets. anthony lawler portfolio manager at gam. let's take a look at u.s. futures this monday morning,

after that negative session in asia, premarket suggesting they're brushing off the concerns, perhaps focus more on fundamentals. economic data as well as earnings. we're looking at dow suggesting a high of 70 points. the s&p 500 up about 5. nasdaq slightly higher on the day in premarket. european markets although we are lower across the board, despite that better than expected ifo data, a blip of green in the ftse 100. the xetra dax, keep an eye on the german market down about 90 point as we see the euro strengthen. coming up on "worldwide exchange," the downward move on the china market tumble. after this break. done go away.

welcome to the second hour of "worldwide exchange," everybody. i'm seema mody. here are your headlines. u.s. stock set to downstairs back after the dow posted its worse week since january. but the biggest one-day drop in eight years. the deal is done teva buys allergan's business for $40 billion. and fiat shares moving down in italy, after u.s. regulators slap a record $105 million fine on the automaker over