welcome to the second hour of "worldwide exchange," everyone. i'm seema mody. >> and i'm wilfred frost. here are your headlines from around the world. currency curveball. china devalues the yuan in a bid to boost the country's flagging economy, but the surprise move sending some of europe's luxury and auto blue chips lower. greece reaches a tentative bailout deal, but the agreement fails to lift sentiment in stock markets. the dow and s&p also pointed to a lower open, despite yesterday's energy-led rally on wall street. easy as abc. google creates a new umbrella company, alphabet, in order to simplify its structure, sending shares in the tech giant sharply

higher in after-hours trade. shake shack also sizzling in extended trade. the burger chain posting stronger than expected 13% rise in same-store sales, thanks to the return of customer favorite crinkle fries. let's bring you the german zedd aug zew numbers, august is up from 63.9 in july, ahead of the forecast which was 64.7. we also have the economic expectations, which has come in below. it's come in at 25.0, down from 29.7 and below expectation of 32. so, current conditions better than expected, economic

expectations slightly worse than expected. as you can see, euro/dollar 1.1036 today. it's up about 20 basis points and hasn't really moved too much off the back of this zew reading. we did see a massive rally on wall street overnight. let's look at how it's looking this tuesday. the focus now does turn to the u.s. retail sales number, which comes in tomorrow. the health of the consumer, of course, will be a topic of discussion. in the meantime, we're looking at the dow right now down about 83 points, the s&p 500 down about 9 points, and the tech-heavy nasdaq, of course, will be in focus with a surprise restructuring move at google. what does it mean for google and alphabet going forward as well as investors? that's something we will be discussing throughout the show. in the meantime, we are looking at the tech-heavy nasdaq down by around 12 points. we got the mixed zew number. the ftse global 300 index down about 10 points. a good gauge of stocks around the world.

if we were to zone in, though, on european equities, we'll take a look. of course, we got that news of that greek deal being reached, and interestingly enough, investors have been shrugging off that news, perhaps that means that that greek deal already priced into equities at this point. in the meantime, we're looking at the xetra dax now down right very close to session lows, down around 1.4%, this as earnings season wraps up here in europe. cac 40 seeing a loss of around 64 points. interestingly enough, of course, the greek equity index opened last week, and of course, we did see a sell-off in the banks. here in today's trade, we are looking at the athens ase index slightly higher on the day by around 1.6%. and a quick look at the uk index. looking at the ftse 100 down by around 25i points. of course, risk appetite, what's that all mean for bonds? >> indeed, we'll have a look at bonds. interesting as you said, the dax hitting session lows off the back of the zew numbers, where we did see current numbers beat

expectations. let's look at bond markets. not much move in the german ten-year off the back of these numbers, just below north 0.7% and the u.s. ten-year still below 2.2%, so those two safe havens have remained where they've been really for the last couple of days. let's look at forex rates as well. we've got the euro up about 15 basis points, back above 1.10, where it crossed yesterday, but over the course of the last ten days or so, the euro/dollar pair hasn't really moved too much. the one that's moved a lot today that we've got up here over the major currency pairs is the aussie/dollar, off 1%, north 0.73, off the back of the moves by the chinese central bank relating to the yuan earlier today. and seema's going to tell you more about that now. >> the yuan is headed for its biggest one-day drop after the pboc devalued the currency in the wake of poor recent economic data. sri is following the reaction around the world to that move by

the pboc. hey, sri. >> hi, seema. well, that surprise devaluation by almost 2% by the authorities in beijing raised fears of currency devaluation elsewhere in the asia space. competitive devaluation, currency wars, call it what you will, race to the bottom. so, we saw this really play out in the currency markets, in the weaker currencies, the asia fx space fed through into some fairly negative moves in the stock market. we already have fed normalization at a possible september lift-off to deal with over here in asia, so higher rates environment, and now this has added another dimension, beijing's move to devalue the currency to try to boost the exports sector. at least, that was the strategy, anyway. i think one of the big questions going forward is whether this is really a one-off devaluation or whether there are more to come, whether this is a strategic policy shift. but in the here and now, you've got to watch indonesia, you've

got to watch malaysia as well. both of those currencies have been the worst performers so far in the asia fx space. so, this was another body blow from china to those currencies. fresh 17-year lows. that fed through to the stock market. jakarta composite was one of the rank underperformers today. we haven't seen these kind of levels since around march 2014. down almost 2.7%. the ko composite off more than 1%. the kospi, the krw, the yuan was underperforming today, down under 1%. shanghai composite on balance was flat at the close because the importers yesterday were down. the airlines stocks, et cetera, as well, because their dollar costs have just gone up. but in terms of the exporters, that gives them something of an advantage. so, a lot of the textile names, for example, the manufacturers, trading companies, they went limit up today. i think going forward, there are going to be some unintended consequences here, if this is policy to devalue the currency

to boost the external side. remember, it's an elections cycle in the u.s., so this could very well be grist to the mill for both sides of the lobby, for both sides of the aisle, rather, to really try to maybe beat up china with the currency manipulator tag once again. so, unintended consequences here from that devaluation. that's where we stand. back to you. >> sri, thank you very much. i think it would be a rich tag if they went for it, given the quantitative easing of the last few years. >> true. >> thank you for that coverage. it's affected stocks here in europe as well, particularly luxury and autos. they've been under pressure, of course, because they do rely on purchases from china, so the devaluation of the yuan seen as an important factor. and of course, we also are auto sales out of china, which added to the pain. july figures falling over 7% on the year, the biggest drop in 2 1/2 years. and those declines in those types of stocks have accentuated -- have grown during

the day. we're now over 3% for all of them, apart from christian dior and close to 4% for the likes of swatch group and lvmh. top story in the tech world, google has announced a new corporate structure, creating a company called alphabet. what's it all about? jon fortt breaking down the details. >> google will continue to exist as a subsidiary of alphabet called google inc. and there will be a new ceo of google inc., sundar pichai, who has been a chief operating officer, will be the ceo of google inc. larry page and sergei brind, the co-founders, aren't going anywhere. they will continue to operate the overall holding company of alphabet. eric schmidt, the executive chairman of google, will now be executive chairman of alphabet. now, what will fall within google and what will fall within alphabet? well, most of the revenue and profit-producing businesses that now exist within google are going to be a part of google inc. that includes youtube, which is being run by youtube's ceo,

susan wajiski. she will continue to serve in that role but report up to sundar pichai. a number of other things, though, will not be a part of google. they'll be a part of alphabet. those things include google x, the research and development arm that's doing things like drones and self-driving cars. that will not be a part of google inc. also, calico, the life sciences project where google is trying to break ground in those areas. those will now be part of alphabet. also, google fiber, initiatives like that that are not part of the internet businesses of google will be part of alphabet. but nexus, the hardware business that isn't exactly internet-related that's connected to android, that will continue to be a part of google. >> analysts have been weighing in on google's change to alphabet. baird says it's incrementally positive. investors view google's speculative businesses such as self-driving cars as a

distraction. yusef squally at cantor fitzgerald has a buy rating, saying it's a key step towards greater transparency. and the market took it well as well. google shares rising 6% in after-hours and they're up about 5% in germany today. >> so far, though, reaction has been positive. wilfred, i was speaking to missoula securities, upgrading the stock to buy from neutral after this radical change. google also upgraded to buy at stifel nicolaus. of course, this is after the company reported blowout earnings a couple of weeks ago. we saw the stock gain about 15% in one day. and here you go, now a management change, a core organizational change at the top. it will be interesting to see how investors react, but at this point when you look at the sell side community, the response has been positive. >> yeah, absolutely. because people feel, as you said, it could be a bit more transparency and a little bit more focus in terms of their innovation. each of the entities now have their own p&l, and if they're not cutting their weight, they'll probably be cut off the investment list. interestingly, and of course,

this is mainly a change for the investment community, not the consumer, but google's such an important word and brand name, and the company overall changing its name to alphabet, does that change it from the consumer point of view? we don't say i'm going to do a search now and use google. you say i'm just going to google something. it's a verb itself. >> i think this is a huge change. google is no longer just a search engine optimization company. this is a company that wants to be a health care company, a drone company. they're also focused on age and redefining wellness. this clearly is a sign that google doesn't just see themselves as a tech company, but ten years from now, we're going to be referring to google as this diversified corporate company that has focus across different divisions, including health care and tech. >> indeed. so, analysts in general taking this well and the market, too, up about 5% in german trade. let's take a look at the other top stories at this hour. and talk a little burgers. shake shack reporting better-than-expected second-quarter profits and revenue. same-store sales rising nearly 13%, well above analyst forecasts of 6.8%. now, the burger chain

attributing that to an increase in menu prices, positive response to the return of crinkle-cut french fries, a shake special and strong results from its las vegas and chicago locations. now, shake shack is boosting its full-year revenue and same-store sales outlook and now plans to open at least a dozen new u.s. stores a year. you can see investors responding positively. the stain gaining about 8% in after-hours trade. here in europe, we're looking at shake shack up almost 10%. kraft heinz reports second-quarter results, the first since the two food companies merged in a $50 billion deal last month. revenue fell at both companies. sales dropping nearly 5% at kraft due to weak demand for its beverages, which include kool-aid and capri sun, a result of fewer promotions than last year. sales at heinz fell 4%, mostly because of the strong dollar. shares were off around 2% after-hours and a similar amount today in germany. all right, still to come on "worldwide exchange," when invested in rome. we find out what's driving the

italian market as the biggest gainer in europe so far this year. don't go away. can a business have a mind? a subconscious. a knack for predicting the future. reflexes faster than the speed of thought. can a business have a spirit? can a business have a soul? can a business be...alive? no student's ever been the king of the campus on day one. but you're armed with a roomy new jansport backpack, a powerful new dell 2-in-1 laptop, and durable new stellar notebooks, so you're walking the halls with varsity level swagger. that's what we call that new gear feeling.

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welcome back. let's remind you of the headlines. google simplifies its structure with a new umbrella company called alphabet. investors liking the news, sending shares higher in extended trade.

and earnings beat flipping shake shack shares higher in after hours as the burger chain beats expectations. and greece agrees to a bailout deal with creditors ahead of a august 20th deadline for its next ecb payment. so, greece and its international creditors have agreed to a deal on bailout terms following long negotiations. finance ministry sources told cnbc that a number of minor issues still need to be ironed out, but it is expected the funds will be available to greece by august 20th to allow the country to meet an ecb payment due on that date. joining us now is a global equities strategist at jpmorgan. we've reached a deal along before the deadline, this is great progress. >> i think it is. a lot of people are very skeptical, and the question is really over the division between germany and france that we had. but in my view, this is actually an important positive because it

aovertimes moral hazard, and that was always the issue. it was never about greece. it was always about who was going to come after greece, whether portugal or italy or the others. and actually, the fact that the core europe was very firm in negotiations is very good. it gives them a lot of credibility. and clearly, greece in a few months' time might be a problem again. this is not going to be a clear end, but i think for all the purposes of the market, this is a good step forward. >> do you see risk appetite improving now that the greece story, of course, becomes a little bit more positive? and if so, would you recommend clients to add to their positions when looking at european equities? >> i think from the perspective of europe, greece story should be going on the back burner. the problem is obviously china, that market is always trying to find the next negative, and it was bond sell-off in april-may, then greece, now it's all about china. but with respect to europe, i think the peripheral story looks very good. >> let's talk more broadly. you write in your notes that the

fundamental backdrop is still supportive of equities. is that a view that's relative to other asset classes, or in their own right in absolute terms, are equities still attractive? >> i think in absolute terms, equities still are a buy. the problem is obviously that the cycle global is not very synchronized, that you have a huge divergence. you have the u.s., which is probably ending its cycle. you have europe, which is just starting its cycle. and then, obviously, you have the emerging markets in china in particular which are in a structural down cycle. so, i would say that the allocation that we started the year with, which is underweight u.s., underweight uk and overweight japan and eurozone, these are the areas where you'll see the most up side, euros and in japan. >> how will a potential rate hike in september impact european equities? >> the rate hike, the first rate hike itself never in a history was a problem for the market. if you look at the last ten cycles since the second world war, the first rate hike could

be a confirmation that the economy's strong enough and capable enough to accept the rate hike. so, market would always have a bit of a 4% into the rate hike, but markets every single time made a new all-time high after the first rate hike. the issue is just that for the u.s. itself, you do have a problem. the dollar is likely to be supported, and 40% of the u.s. earnings are coming from abroad, so strong dollar and the fed hikes, u.s. equities should continue to underperform. but for the global equity markets, i don't think this is a problem. >> let's talk, then, within europe, where your top picks are. i'm interested that you like italy a lot. we've seen a strong rally year to date in italy. what makes you think it can continue throughout the rest of the year? >> so, the key problem is that we had a strong rally. and if you look at last year, italy also started very well. it was up 20%-plus in the first half, and then it all went pear-shaped. italy basically lost all of the gains and ended up down on the year.

and people remember that. and the question is, will that be repeated? our view is not to look for the repeat of this pattern. we actually think that the big difference this time around is the credit cycle. and the credit cycle in italy's clearly turning up. you have the demand for credit. every single sub category of debt in italy's showing a positive demand for credit. and then if you look at the italian banks, which are more than 30% of the index, they have a huge correlation between their roe and the credit demand. if the credit demand in italy's turning up, then the market will be supported. >> i'm surprised you're not mentioning spain, though. that's been seen as the rebound kid in the eurozone, seen as having growth in the rest of the oeurozone and auto sales up 20% for the month of july, indicating that the consumer is spending. >> well, this is a very fair point, that if you look at two years ago, spain was really the poster child of the reform and recovery, and italy was always seen as lagging, and that has switched. i would say the reason why spain

has not done that well this year is, one, initially people thought the next series of problems would be in spain with podemos, and we think the probably that podemos is going to shape things is going down. and the second issue really is latin america. latin america is doing terribly and ibex is heavily leveraged to latin america. i would almost say that we need to get the first fed hike, some kind of a thing where people look through it and realize this is going to be very gradual and then maybe latin america turns its fortunes, and therefore, spain as an indirect play starts to look better. but for all practical purposes for us, it's italy as the top pick. >> and you like japan as well. tell us quickly why, and does that rank above or below european equities? >> so, japan is still a buy for us, and clearly, there is some complacency there because i don't see clients in the last three or four months, i haven't met a single global client who

said to me i am bearish or underweight japan. so, people like japan. on some of our indicators, japan is very well owned. and clearly, the currency story, the bank of japan support, the official funds buying, all that is behind us. but the reason why we still like japan is because this year, you are not going to have the problem that we had last year, the rate hike. so, we think domestic demand will be broadening and the domestic corporate balance sheet optimization has a long way to go. >> thank you very much. always nice to see you. switching focus now. around 120 people have been arrested in ferguson following protests marking the anniversary of the shooting of michael brown. st. louis county declared a state of emergency for the city after another black teenager was critically wounded in a shoot-out with police. let's get the full story with jay gray, who is live in ferguson, missouri. jay, over to you. >> reporter: hey, seema. good morning to you. look, things have calmed down for now.

that's the good news. still a lot of concern, frustration, uneasy tension on both sides of the protests here after another difficult 24 hours. protesters spilling into the streets overnight. a strong show of force by police. there's been a state of emergency declared for st. louis county. that's where ferguson is. and that provided more officers along the front lines here. the strategy, though, seemed to work. police telling us that overnight there were no shots fired, there was no looting in businesses, and there were just a handful of arrests, that much different than the night before. as you talked about, there was gun play, 40 to 50 rounds fired, including, police say, shots at officers coming from an 18-year-old, tyrone harris jr. he has been charged overnight, faces four counts of aggravated assault on law enforcement, five counts of armed criminal action and one count of shooting at a motor vehicle. police say this stepped-up presence will continue. they'll move forward with this

strategy for as long as they believe necessary. protesters say they'll continue to deliver their message like they have in the year since michael brown was killed. that's the latest live here in ferguson. i'm jay gray. seema, wilfred, back to you. >> nbc's jay gray. thank you so much for that live report. all right, let's have a quick look at futures as we head to break. they're pointing to a negative open, following the lead of europe, where we're looking at just over 1% of declines for the stoxx 600. "worldwide exchange" back in two minutes.

welcome back. let's take a look at the other top stories at this hour. u.s. authorities are reportedly set to announce charges today in a case tying together hacking and insider trading. reports say the s.e.c., fbi and secret service are involved and more than a half dozen people are expected to be indicted. in the scheme, hackers allegedly infiltrated newswire services that publish press releases about company mergers and acquisitions. traders would then use that information to make early trades on those deals. reports say they netted tens of millions of dollars. symantec is reportedly close to a deal to sell its data storage business to the carlyle group. the transaction could be worth up to $8 billion and be announced as soon as today when symantec reports earnings after the close.

symantec has been seeking buyers for months, but interest has been limited due to taxes associated with splitting up the company. let's look at share price action, up 1.8% today in germany. the s&p 500 is about to become the s&p 505. yeah, that's right. the benchmark u.s. market index is expanding. it actually has 502 listed stocks because of some companies that have multiple listings, google and discovery communications. now, in january, s&p dow jones indices made changes to allow multiple-share classes. three more companies will now have dual listings in the s&p 500. that's comcast, news corp. and 21st century fox. the changes take effect after the close on september 18th, coinciding with a quarterly rebalancing. all right, still to come on "worldwide exchange," ebay gets a makeover. we speak to the company's chief curator about the online marketplace's new content strategy. and before we head to the break, we'll just let you know, u.s. futures slightly lower as we

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you're watching "worldwide exchange," and i'm seema mody. >> and i'm wilfred frost. here are your headlines from around the world. >> let's start with google. easy as abc, google creates a new umbrella company, alphabet, in order to simplify its structure, sending shares in the

tech giant sharply higher in after-hours trade. shake shack also sizzling in extended trade. the burger chain posting a stronger-than-expected 13% rise in same-store sales, thanks to the return of customer favorite crinkle fries. currency curveball. china devaluing the yuan in a bid to boost the country's flagging economy, but the surprise move sending some of europe's luxury and auto blue chips lower. greece reaches a tentative bailout deal, but the agreement fails to lift sentiment in stock markets. the dow and s&p also pointed to a lower open, despite yesterday's energy-led rally on wall street. and a positive start to the week with all three major indices finishing well over 1% for the day. hints of a later rate hike, plus a huge rally in china overnight adding fuel to the gains. but here on tuesday, futures are pointing to a lower open. some of that might have to be from that surprise reaction or

decision by the chinese central bank to lower the daily fix to the dollar. european equities also moving lower. many of the auto and luxury stocks in europe responding negatively, weighing on the major indices, specifically the xetra dax, seen as the export powerhouse. the inderive trading at 11,454, down triple digits, a 1.3% move to the down side for the german markets after the zew number also slightly disappointing for investors. a look at the ftse 100, given its high exposure to commodities, it is the underperformer when you look at year-to-date performances of european equities. down around 47 points, a 58-point move to the down side for the french markets. interestingly enough, of course, news of this greek deal emerging ahead of expectations, sending the greek stock index slightly higher in today's trade by around 2.2%. if we take a look at the euro stoxx 50, interestingly enough, the euro itself not moving a whole lot on the back of that

news of that greek deal. perhaps that's suggesting a lot of this deal coming together is already priced into stocks as well as currencies. the euro holding on to 109. the euro stoxx 50, which is a good gauge of stocks across the eurozone, trading down by around 35 points. so, how do you make money in today's markets? of course, on the back of that greek deal, news, of course, also that china devaluation. well, here is what investors have been telling us this morning. >> it's going to take a year or two for reforms in china to come through. and there is this big shift from this big manufacturing base into consumer-led economy. and businesses like bmw and volkswagen, et cetera, they're obviously going to benefit from that ultimately, will continue to struggle until it actually comes through. >> the market is obviously looking at iran wondering what's going to happen next. how is the lng going to be exported? they haven't got the terminals. will they use floating lng technology to get the lng out?

that's a big deal. these are big projects for shipping. >> the eurozone, the economy, we should do better next year. inflation should return towards where the ecb's target is, and therefore, you know, qe will not be extended beyond september. so, you know, more of the medium-longer term, we think it's more of a bearish market for european fixed income. google is restructuring as the tech giant comes to grips with its massive size and the different nature of its various businesses. it's forming a new parent company called alphabet to streamline its corporate lineup. alphabet will be led by co-founder and ceo larry page. sergey brin will be president and eric schmidt chairman. google shares will convert to alphabet shares later this year but still trade under the same symbols. let's stick with tech. in an effort to help customers navigate the flood of available products, ebay has designed collections consolidating similar items. the eclectic collections span

everything from beyond the pale collection of vintage lunch boxes to the prose on george ka pawn, typewriter and materials collection. joining us to discuss is the man behind all of this, michael phillips moskowitz, global chief curator at ebay. michael, a pleasure to have you on "worldwide exchange." >> thank you for having me. >> you've sold your e-commerce company to ebay and now you're tasked with personalization of design and content on ebay. help us understand, what exactly does that mean? >> well, i think that we've witnessed both a generational and a shift across the space. when i started the bureau in 2012, kursion was a bit of a buzz word. today it's not a fleeting phenomenon, but a fixture of the way we shop and feel. and i think when i was brought on board it was with one specific charge, to help categorize a shift in public understanding and perception of ebay as a brand and business, because this is an extraordinaiextraordinary place. we have 800 million listings that span treasures from the bottom of the ocean, the thing

that you've always fantasized about since childhood, a baseball card, a car, a watch, i mean, anything from the physical world that might have at one time in history been or had its rightful place at the library of alexandria, only ebay will never burn. it's the most emotional, substantive, compelling and fascinating archive that we've ever seen or witnessed. >> now, ghaviven that big spreaf things available on ebay, was there an issue that people start to get lost, that they can't really find the things they want because it is so complex? >> right. two things. one, we have to leverage the power of whether you call it curation or hyper selectivity, it's a more intuitive journey. and they're selling the beats deep within the heart when it comes to story-telling and it narrative. when we couple those together for a symbiotic relationship and add into the mix, or frankly, you layer that on top of these 800 million listings, that is an incendiary combination. >> this curation of content, does this speak to ebay's

efforts to rival some of the fashion e-commerce sights? >> i think what makes ebay truly unique is our inventory. the things you can find in one place are available no place else on planet earth. that's what makes us so important. and i think in an era of tech when we're becoming increasingly desensitized to one another, there is a downside to infinite connectiveness, and it means what it means to be human is becoming a harder psychic struggle. and when we can deliver moments of surprise and delight, that has real merit. that's why when ebay wins, it's a noble effort and not just a business outcome. >> is there also this hope as we make these changes to content on ebay's platform that you'll be able to lure in more artists who perhaps are going to etsy.com? >> that's a good question. a lot of my efforts over the fall are enlisting the support of recognizable names and emerging talents within the contemporary art world and there will be activations you see both on site and off in an effort to,

you know, forcibly evolve people's perception of and the manner in which they encounter our site. >> okay. >> overall, do you think the biggest driver for ebay, the marketplace, of course, part of the company, remains the fact that it offers retail on a digital platform or the fact that it offers many, many more items that people can buy than if you walk into any physical store? >> i think what's so rare about peering down into this seemingly endless universe is you have permission to wander. you have permission to imagine and to dream. it's hard to do -- look, if you can close your eyes, not that you're ever going to do that on television with me now, but if you did -- >> i'll do it. >> if you close your eyes and you can imagine being at met or you can go to the tate or to your child-like bedroom and you can remember that dream that you once had, that thing, whatever it happens to be, i guarantee you is either available today, will be available tomorrow or some day soon on ebay.

that is true of no other site on planet earth. >> okay. michael, thanks very much for joining us. >> thank you for having me. >> michael phillips moskowitz, global chief curator at ebay. now, greece has agreed on a deal with bailout terms following long negotiations. finance ministry sources told cnbc that a number of minor issues still need to be ironed out, but it is expected the funds will be available to greece by august 20th. to allow the country to meet an ecb payment due on that date. joining us on the phone is francesco papadia, former director general for market operations at the ecb and chairman at prime collaterized securities. thank you for joining us. much appreciated. now, we've reached a deal well before a deadline, which is certainly very refreshing when it comes to greece. but in your eyes, how significant is this deal in terms of helping greece turn a corner meaningfully? >> well, this is an important hurdle, an important obstacle

that has been surpassed. but of course -- and it shows the great determination on both the sides of the creditors in greece to go forward. but of course, there remain important further hurdles to be surpassed. first, whether surplus will manage to continue support in greece for the agreed course of action. the second is whether the macroeconomic trauma that was caused by the election and action will be surpassed and greece will get back to growth. and the third one is whether the creditors will comply with their promise to reduce the burden of debt of greece. >> do you think, of course, despite this being a step in the right direction, what do you see as the biggest risk to this greece deal? could we, in fact, see a sharp intensification of this greek crisis coming back to light

here, francesco? >> yeah, this could happen. of course, the probability of that is lower after the agreement than it was before, but we are definitely not on safe ground. i would say we would be in unsafe ground when greece will start growing again. i mean, that is the most important thing of all. >> indeed. and that, clearly, we still have a lot of hoops to go through before we get to that point. in the shorter term, though, francesco, let's go back to the point you made earlier about the political capital that mr. tsipras still has back home. do you think that could turn south if people don't welcome this deal? he does have a complex set of coalition partners. >> that's true. on the other hand, he showed quite a lot of ability to get consent not in his party but in the country and in parliament. i think that his approval rates are very, very high.

so, it seems that he connects to the deepest sentiment of the greek electorate. so, yes, it's a very difficult, but he seems to be able after some uncertainties and vagabonding, so to say, to have to pull his act together. >> okay. thank you very much for joining us, francesco. much appreciated. francesco papadia, chairman at prime collateralized securities. all right, still to come on the show, google knows its abcs, plus, investors are salivating over shake shack's tasty earnings report. we break down the burger chain's results, straight ahead.

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welcome back. google is restructuring its company as the tech giant comes to grips with its massive size and the different nature of its various businesses. it's forming a new parent company called alphabet to streamline its corporate lineup. the company's largest entity will still be google, comprising of search, ads, maps, youtube and android. that will be led by sundar pichai, currently senior vp of products. other divisions include google capital, xlabs, health care, nest and fiber. and we should point out that when we got news of this radical change at the top, google shares did move higher by around 6%, and that's how they are looking right now in premarket, up by

around 6%. but here we have for you a one-month chart. because remember, those better-than-expected earnings sending google shares higher. and for the month, the stock is up about 19.2%. wilf? >> yes, indeed, google likely to buck the trend of u.s. futures, which are pointing lower at the moment, called to open higher. and it's not the only company called to buck the trend of the rest of the market, because investors also hungry for shares of shake shack following a very positive earnings report. let's get all the details on shake shack. landon dowdy standing by at cnbc hq, as ever for us. landon? >> hey, wilf. shares of the hamburger chain known for its hormone and antibiotic-freiburgers and sides soaring more than 8% in after-hours trading. shake shack reporting second-quarter earnings of 9 cents a share on revenue of $48.5 million, both of which beat analysts' forecasts. same-store or same-shack sales rising nearly 13%, well above estimates of 6.8%. the company attributes that to an increase in menu prices as well as the response to the

return of crinkle-cut french fries, a shake of the week special and strong results from its locations in las vegas and chicago. shake shack has 37 company-owned restaurants in the u.s., including 6 just in new york city, and now plans to open at least a dozen new domestic stores a year starting in 2016. during the second quarter, it opened three u.s. restaurants, one in the uk and its third in moscow. shake shack is also boosting its 2015 revenue forecasts and expects full-year same-store sales growth in the mid to high single digit percent range. the company went public at the end of january at an ipo price of $21 a share and more than doubled in its debut and is trading more than 50% higher than its first day closing price. shake shack also announced on monday it's launching a second offering and could raise $200 million for shareholders, including founder danny meier and private equity firm leonard green. sheking shake shack today in

europe, it's up about 20%. back to you. >> landon, thank you very much for that. right, let's have a look at some of the other top stories as well today. here in europe, of course, shares doing very well at the moment. we, of course, are heading for the market open where futures are pointing low. "worldwide exchange" back in a couple of minutes.

welcome back. european markets have softened throughout the day's trade today. as you can see, germany is down 1.7%, france down 1.3%, the ftse 100 also down around about north 0.9%. it follows a decent start to the week yesterday, but today going back to the trend that we saw for the first week of trade in august. u.s. stocks perhaps taking their cues from europe. we are lower on the day. the dow down by around 121

points. investors perhaps also reacting negatively by that move by the chinese central bank to devalue its currency. let's also get you a rundown of what to watch this trading day in the u.s. the first report on second-quarter productivity's out at 8:30 a.m. eastern. productivity is expected to rebound following two quarters of declines. labor costs are expected to be flat after rising nearly 7% in the first quarter. and at 10:00 a.m., we get june wholesale trade numbers. casual burger chain red robin reporting earnings before the opening bell. interesting name to watch after hearing from shake shack yesterday. and after the close, we'll hear from symantec and cree. joining us live from charlotte is john silvia, chief economist at wells fargo, to discuss this week's trading action as well as the economy. and john, good morning to you. of course, a lot of focus on that move by china to devalue its currency. >> good morning. >> is this a sign that beijing will increasingly use forex as a tool to stimulate its economy?

>> well, clearly, i think that's the story right now, because in our view, the transition that the chinese government wanted to make from less exports, more domestic production, more services, consumer spending, i think was growing more difficult than they had planned and the economy had slowed down a little bit faster than they had wanted. so, here was an opportunity to devalue the yuan just a little bit right now and help prop up those exports. so, clearly, i think there was a surprise that the economy was fairly weak, but also here was an opportunity to try to boost up that export sector a little bit. >> although, john, i suppose 2% devaluation of the yuan compared to what we've seen, of course, for the euro, for the yen, and indeed, the greater flexibility that smaller asian emerging markets have in and around china. is 2% going to be enough to start to prop up those exports? >> well, 2% is going to help a little bit, but clearly, any

country the size of china that's trying to get into this transition is not going to lead to a correction that's going to get them back to 7%-plus growth. i think one of the great challenges that the chinese have is they're now a more responsible party, they're a bigger country, they do more in terms of foreign exchange and capital investing around the globe importing capital, exporting capital. so, for them, it's very difficult to have major moves, given that they're a greater international partner now. >> john, what does this all mean for the u.s. investor? >> well, again, we have to look at the change in exchange rates means that when a u.s. firm is taking money out of china, it's going to be less valuable, so it will be negative in terms of corporate profits earned abroad by u.s. corporations. and then on the real side, of course, it makes the chinese

exports a little bit more competitive, and therefore, more challenging for u.s. firms to compete against. so, there's a financial implication with respect to corporate earnings, and there is a real side implication in terms of trade deficits. >> one eye on china, the other eye on greece, john. greece, of course, striking a deal with its creditors, but markets seem to be shrugging off this news. does that suggest that investors don't care as much about the greece story anymore, or that it's largely priced in, this deal, that is? >> yeah, i think in the short run, it's pretty much priced in that there's going to be a two or three-year period of transition until there's a better sense whether greece can, in fact, move ahead with economic growth and its debt payments. so, right now the markets are sort of saying okay, we're going to let it ride for a while, see what's happening, but the evaluation will gradually unfold maybe in another year or two. >> john, let's bring the debate quickly back to the u.s.

what's your latest projections for when we're likely to see a rate hike? >> sure. well, we're still looking at september. we don't think the chinese devaluation makes a big difference with respect to that. i think when the fed looks at it, they've talked about raising the rates later this year. they have some improvement in the labor market, as they suggested. and so, i think that's going to be enough, given the 200,000-plus we've seen now over the last six months in terms of jobs. that's enough improvement, i think, for the fed to move ahead and raise rates. >> john, thanks so much for joining us today. john silvia, chief economist at wells fargo securities. >> thank you. >> as we just showed you, we have u.s. futures pointing to a negative open, european equity markets are off 1%. that's all we have time for today on "worldwide exchange." thanks so much for watching. i'm wilfred frost. >> and i'm seema mody. we'll see you tomorrow. next up is "squawk box."

good morning, everyone. breaking overnight, china moves to devalue its currency, sparking the yuan's biggest one-day loss in two decades and sending shock waves through the global markets. a developing story. greece says it's reached an agreement with creditors on the terms of a new bailout, but this is not a done deal. some details are still unresolved. and the abcs of google. the tech giant restructuring creating a new parent company called alphabet as it tries to keep innovating beyond search. it is tuesday, august 11th, 2015. "squawk box" gibbs right now. ♪ abc, easy as 1, 2, 3, simple as do re, mi ♪ live from new york, where

business never sleeps, this is "squawk box." ♪ oh, it was a given we were going to open with that music. good morning. welcome to "squawk box" here on cnbc. scott wapner along with becky quick and tyler mathisen. joe and andrew are off today. and attention star-gazers, tonight could bring the best meteor shower of the year. the perseids. nasa tells us to expect fast and bright meteors that frequently leave trains with as many as 80 per hour at the peak. look out for the perseid meteor shower. now to business of the morning, starting with big news out of china. ? a surprise move, the central bank there deciding to allow its currency to fall. the pboc described the near 2% devaluation as a one-off based on a new way of managing the exchange rate, but many investors are wondering if this is really the beginning of a slide in the yuan's value. we'll talk to a currency trader in just a few minutes. asian stocks selling off late in the session on that currency move. take a look. it's red arrows across the board. shanghai, where you'd like perhaps