heavy selling across european stock market with all sectors trading in the red. traders taking their queue from a session seen stateside yesterday which saw equity mark markets with the biggest one day reversal. >> after another volatile session the benchmark index settles in the red. the nikkei posting it's biggest one day gain since october.

>> a strong performance in the u.s. and u.k. offsetting weakness in emerging markets at wpp. the ceo telling cnbc it's not a reason to write off it's prospects. >> it's in our interest that china continue to grow because it will be the driver of many industries like our own. >> the falling oil price continues to take it's toll on transocean. shares slump over 10% after they cut the dividend for the next two quarters. hi, everybody. good morning, welcome to worldwide exchange. we have two hours together. we have a fantastic line-up of guests and we'll be getting a lot of thoughts and analysis on what is taking place at the moment. i'm not sure everybody knows but it's worth discussing the themes we're seeing. it does seem to be a day by day story. despite the fact that we saw the chinese coming through with the

measures with regards to cutting rates and cutting their rrr yesterday we still saw a very, very volatile asian session and that feeding through into the u.s. as well. that volatility with the u.s. markets seeing substantial gains yesterday only then to drop into negative territory. a big number of swings taking place in yesterday's session. this morning our european market across the board called lower. many called down triple digits and the stoxx europe 600 lower by 1.5%. a bit of selling taking place. you would remember as you were joining me yesterday on the closing bell program yesterday evening that we saw substantial rallies taking place heading into the close with many markets higher in the region of 4 to 5%. the dax closing up by 5%. the cac up by 5%. they were all higher by more than 5% as sectors yesterday on the close and this morning we're

reversing that once again. off by 1.5% at the moment. a one week chart here. so that's the change over the course of the past week so we have come back from the levels we saw just around a session or so ago as we had that massive volatility here earlier this week but we're lower by 7.5% when looking at these stocks in europe. the big blue chips. our european index this morning, red screens across the board. ftse hanging on to 6,000. xetra dax off by 1%. the cac and ftse mib off by 1%: this morning we're only seeing selling. the worst performing sectors of the bunch knocked down by the amounts we were looking at earlier this week but health care off by 2% and oil and gas

off by 2% and basic resources off by 2.5% despite the fact that we're looking at strength in oil. we have come down so much and we're looking at a bit of buying in the oil price this morning so the volatility definitely continuing. when it comes to asia i was mentions the shanghai composite reversing these earlier gains to hit a fresh 8 month low in their trading session. posting now their fifth consecutive session of losses. this despite the pboc cutting china's benchmark rates for the 5th time since november of last year. let's hear a bit more about these asian markets. sri joins us from singapore. good to see you again. so the volatility definitely continuing. >> it does and it's a quite curious reaction in the regional markets to the easing measures by beijing because they were very well received in certain

regional markets, career and japan case and point but they didn't two down well in the market we settled at fresh 8 month low. 5th consecutive session of losses. wild volatility. we saw swings either side of 3% and we dipped below this 3,000 threshold as well at the close. psychologically very important. there's a lot as to whether it's going to cut it in terms of stabilizing the economy and market confidence by associat n

association. so it seems to be something of a circuit breaker. they put this very well and described it as a good start but not a game changer. the bottom line here is that many easing measures are warranted. we certainly know that the pboc have the ammunition. probably going to require more monetary easing, more fiscal support and weaker currency as well. it's a strong session. best percentage gain in almost two years and the best session in almost, well, since october for the nikkei. they have strong linkages to china. perhaps they're seeing it as class half full as opposed to class half empty in terms of the easing measures. >> thank you for that. so yeah.

quite a bit more volatility. precisely with the measures it's interesting to see they're not looking at the positivity that one might expect after a rate cut and cut to the reserve requirement ratio as well. >> does that suggest they're losing confidence in the pboc and people's bank of china in stimulating the economy? >> that's a good question and also whether or not there's something that the central bankers can do now or if it's the much needed correction people say we have been in for for quite sometime. >> absolutely. >> healthy correction. >> china continues to be the source of confusion for investors. joining us is oliver barren. a pleasure to have you on the show. when analyzing china's economic prospects you would think with con sumpg now the most important engine in china's growth model the pboc would be doing more to help the consumer but it

suggests they're more focused on the investor. would you agree? >> well, the markets are in freefall. investor confidence is quite weak. they're getting very mixed signals from the government. one day they're buying the market and supporting it and the next day they're saying we're not going to intervene anymore. so the signals are very mixed and investors are reacting quite negatively as a result. but you can look at the easing measures as saying these are positive for the economy. they'll be good for the economy market and good for recovery and demand there and addi adding liquidity is always a great thing. >> initially higher but ending the session lower. does that suggest to you that investors are losing confidence

with the central bank's ability to stimulate the economy? >> i think after the friday flash pmi data everyone expected the easing to come over the weekend. when we didn't get any monetary easing to prop up the economy over the weekend or monday morning investors responded negatively. they were well expected and we really need to see more to get confidence back because right now there's not a lot of hope from investors that the government is going to do what's necessary to prop up the market and prop up the economy. >> oliver, i just want to mention something that's just hitting our wires by reuters. the chinese central bank, they're saying they're going to be injecting 140 billion yuan on wednesday. they say the slo loans are to have an interest rate of 2.3%. so they're injecting 140 billion

yuan by slos on wednesday. it does seem like they're not completely taking their foot off of doing more, oliver. >> no, i agree with you. the policy to devalue the rnb and make it more market oriented changes pieces in the monetary policy puzzle. so the first thing that we're see as good that investors who had maybe been trying to take money out for awhile or were thinking about buying dollars are doing that much faster now. they're anticipating the r&b will go quicker. they're trying to get money out. we saw it last week through lending term facility and open

mark market operations and they're needed to offset the capital outflows and because they're trying to keep them stable or give the impression of stability to try to arrest the outflows it's tying it's hands on easingeasingeasin easing liquidity even more. >> yeah, the short-term liquidity operations, they're injecting 140 billion yuan via these operations and they'll be doing that today here on wednesday. on one hand if we're heading toward yuan devaluations which seemed to be the name of the game when they first devalued yuan by 10% officially and we had the further weakening measures coming think by the pboc and they're trying to stem capital outflows does that mean that it heads further south?

>> i think the only way to go, at least in the short-term, is down. you have a situation where they have to be adding more liquidity. certainly with rates going down and interest rates coming down in china at the same time as the markets are still looking for u. s. rates to go up, that makes u.s. dollar returns more attractive on par and that leads to additional capital outflows so i think the optimistic case here is that they accept accelerated capital outflows now. they let the rnb fall a little further. the weaker rnb, the more aggressive monetary easing gets the economy righted. gets the property market going again. drives up infrastructure construction and benefits the consumer a bit and you start to see the stable rnb and inflows again. it can only go down but of course -- >> now i was just going to say oliver the question is when does that turnaround come to

fruition. an economist says china's economy will see a u shaped recovery now delaying that to the fourth quarter. is that when you see the rebound coming as well? >> well, we have been tracking the property market as an indication for overall economic health and we have been seeing that home sales and transactions have been picking up since april and historically once that cycle starts you see a pick up in investment 6 to 9 months later so you'd expect to see new construction starts hitting around the 4th quarter and real estate investment rising and providing more demand for materials as well. i would say we're looking at a 4th quarter recovery as well. >> we'll see if you're right. a lot of people betting on some recovery given the steps taken

by the central bank. oliver thank you for joining us live from beijing. oliver barren, head of research at north square blue oak. >> the flashes just hitting our wires via reuters, the chinese central bank will be injecting 140 billion yuan. so we're just hearing that and they're going to have an interest rate of 2.3%. so does seem like they're trying to step in as we just heard from a previous guest impl. >> wpp shares trading lower after reporting a 2% increase in sales in line with forecasts. it continues to benefit from consolidation trends in the industry and growth in developed markets help to stem losses due

to the strength of the pound. now speaking to cnbc earlier, he is still bullish on china. >> that was not china's problem. what has happened now is we have seen the stock market excess, those excesses in china, the stock market was overblown. there's been a correction. the economy is under pressure there. in my view it's a cyclical swing. we saw in our own results the first quarter was strong. the second quarter was weak. july actually was a better month forecast through the end of it rather like the e-mail that was sent to cnbc by tim cook around july and august. i'm a little bit more bullish than you are for china. but it's not china's problem in 2008. the issue now is whether the fed will react to what we're seeing in china and elsewhere and the devaluations in the currency war

that we're seeing in various markets by not increasing interest rates. >> you look at gdp growth it's been tepid in the back end of 2014 and into 2015. there's no inflation, very little pricing power and focus on cost. if you look at our results in the context of that our top line growth is reasonable. we have strong margin improvement and strong profitability. that reflects the real world and the real world is the fast growth market versus been slowing. the real world is the in a toma market versus been better. >> it's not just tim cook that of course wrote that e-mail to jim cramer saying he's bullish on china, you have the head of the world's largest advertising company also saying we're bullish on the growth metric wes we're seeing in china as well.

>> it's an important market for them. regardless of the volatility seen now. when you look at their overarching growth figures right now, they had good growth across all the regions advertising and media, digital, direct, specialist communications. they account for $1.4 billion of the total revenue during the first time. he indicated earlier to our colleagues on squawk here in europe how the developed markets are stronger at the moment. >> bringing this back to the chinese stock market a lot of volatility. how does this impact consumer demand in china? . we just got data out today. it actually rose for the third straight month in august despite the volatility and steep declines in chinese stocks so based on this one me trick it suggests the consumer in china unphased by the volatility in the stock market. >> but also the chinese consumer

could very well be very very different than the chinese investor on the markets, right? so it's a very two prong story. >> despite retail participation. obviously a big part of the recent run up in chinese stocks. others are voicing in around china. there hasn't been an alarming level of capital flight from china. the recent market sell off, this is of course according to dow jones that spoke to an executive at black stone. it has limited impact on property investment strategy in china. they have not seen big change in china's real economy in the last few months and they're eyeing buying opportunities in china as prices come down. so there you go. >> interesting. >> let's move on. let's talk about some of the other stories. vw moving lower on disappointing july vehicle sales that fell by 3.7%. this on the back of weakness in the key emerging markets, china, russia, and brazil.

shares near correction territory down by more than 9% over the last fortnight alone. coming up on the show, find out how burger king is proposing to celebrate peace day with it's fast food rivals mcdonald's. and one man continuing to make enemies is donald trump according to many. later we tell you about what the presidential hopeful's latest clash with the press is all about. also play it safe. why one cautious fund manager says he's buying consumer names in these suturbulent markets.

welcome back. we just need to tell you a little bit about cnooc. we were talking about china and what's going on there. they're announcing their 2015 results. these are unaudited results. they're announcing a consolidated net profit of just over 14.7 billion which is down by 56%.

they expect it to continue and they're also announcing a dividend of 25 cents per share. international oil prices are expected at a low level and competition is expected to intensify. these are some of the things that this oil and gas company is announcing this morning. so again, they're looking at international oil and gas prices. oil prices at a low level. competition is expected to intensify and they see the severe operating environment to continue. >> shares of transocean trading sharply lower after it's seeking shareholder approval to cancel it's third and fourth quarter dividends. they cut the payments by 80% from last year as it deal with the prolonged slump in oil prices. transocean expects to report an annual loss of more than $2 billion. it's been hit hard by the slow

down in offshore drilling as oil producers pull back from higher cost deep water areas. >> checking in on the price of oil we've seen slight gains from low levels. brent crude shy of $44 per barrel. wti hanging on below $44 barrel by .5% as well. this is where it gets interesting. the former u.s. treasury secretary indicated the fed should consider another round of quantitative easing. he's saying the economy could be in the early stages of a very serious situation. he told cnbc why low interest rates are still needed to spur growth. >> my fear is that the new reality in an economy where the labor force isn't growing very fast. where productive growth is slower. where capital goods are much cheaper. where the nature of production has shift sd that you may need those kinds of low interest r e

rates to maintain a reasonable level of growth. that's why i come back to doing other things to be the excel ra excellerant for the economy. >> he believes the next move won't be to tighten policy. he expects the central bank to ease via quantitative easing warning the fed is not paying enough attention to the long-term impact of near zero interest rates. >> more economists are weighing in on when they think the fed will or won't start hiking. the odds of a september hike are shaky at 35 to 40% but still remains the most likely meeting for a hike to happen. he's saying october is a possibility if the fed holds off next month. william lee is sticking to september as there's signs of containment. market volatility could gain

momentum to cause global contagion but not yet though. u.s. economy data still solid and upward revision to second quarter gdp which could encourage the fed to move. >> and as usual we'd love to hear from you. how do you think that a september rate hike is looking now? are we going to see it? isn't it going to happen? should the fed be leaning toward more easing as opposed to tightening? quantitative easing? get in touch on worldwide exchange and find us on our personal twitter handle handles @seemacnbc. >> thank you. >> still to come on the show. >> still to come, we're going to talk more about oil. crude realities coming in for russia. we analyze the growth outlook for the world's 5th largest economy. that story coming up. don't go away.

equity markets posting their

biggest one day reversal since the '08 crisis. >> strong performance offsetting weakness in emerging markets for wpp. the ceo tells cnbc that chinese volatility is not a reason to write off it's prospects. >> it's in all of our interests that china continues to grow because it will be the driver of many industries like our own. >> and the falling oil price continuing to take it's toll on transocean. shares slumping after the offshore driller seeks to cut it's dividend for the next two quarte quarters. volatility seems to be the name of the game when looking at asian markets. the shanghai market higher after the pboc unveiled the measures to stimulate the economy but as we approach the end of the session the shanghai composite ending lower. it's lost a fourth of its value in the past five session. that keeping investors on edge. the shenzen composite down 10%

and today's down lower than 1.5%. the pboc will inject 140 billion yuan or $21 billion into the money markets via short-term liquidity operation loans also known as slos. this is the latest move by chinese authorities to stem the stock declines after yesterday's rate cut failed to prop up markets. let's get the word from sri live in singapore. >> it's very clear that they're trying to stave off a liquidity squee squeeze. they'll release 650 billion yuan into the chinese money markets. it sounds like a good start but the net effect of all of this liquidity is the sterilize or

offset impact of the recent devaluations which is called capital outflows which caused liquidity to dry up. so it looks as though it's aimed at the liquidity tank of china. they allow the banks to borrow funds for 1 to 3 days and let me just sum up by saying again i don't think it's a game changer. i think it's more incrementalism by the pboc. it doesn't open up the flood gates. however having said that let's see how the chinese markets open up tomorrow. it could go some way to stabilize sentiment after a rough ride today. that's where we stand. back to you. >> thank you so much. >> now the amaze lanmalaysian r fell sharply. they're considering exiting a

plan to help restructure malaysia's state investment funds debt. authorities are denying that the restructuring deal has fallen through. >> let's take a look at european markets at this point. yesterday stocks closing sharply higher. the dax, in fact, gaining about 5%. the ftse 100 also breaking it's 10 day losing streak. in today's trade you can see the ftse 100 is lower by 1.3%. the dax lower by 1.2%. yesterday we saw wall street post losses after moving higher on the back of the move from the pboc. stocks failed to hold on to gains. in fact in the last 20 minutes we saw the dow, the nasdaq, and s&p 500 moving into negative territory. >> what do you think in the u.k.? mortgage lending up or down? >> up. i'll be optimistic. also because you can see it right there. highest since 2014.

just shy of 1.5 billion pounds so that means that the u.k. mortgage approvals are up by 11% year on year for the month of july and front of the ft this morning they made a point saying it's defying the doubters and setting record rents for the south bank. it's a huge building in london. >> i hear it's a great date spot. >> really? >> yeah, i'm told. >> i wouldn't know. i don't know. i never go on dates. 70% is now occupied it says, right? but despite everything that's going on they're still able to occupy brand new very large buildings. >> very interesting read. shall we move on? >> yeah, i think you should. >> let's talk more about russia. standard and pores sees russia's bank support reach over $14 billion by the end of the year. s&p says it's very likely the central bank will extend it's

support program to encourage the stronger banks to take over their weaker counter parts. earlier the bank of russia said it has not tested bank's ability to with stand severe ruble weakness in the third quarter. estimates indicate that the russian gdp contracted by 4.6% year on year on the second quarter. this is after the economy shrank during the first quarter. the country is its largest trading partner. >> we're just getting some earnings. i'll get them to you in just a second. second quarter net profit at 54.6 billion rubles. analysts were expected 41.2 billion roubles. second quarter loan loss provisions at 117.1 billion.

in terms of price action, down just fractionally on the day. >> yeah, well chris joins us, founding partner, welcome. so kwlis let's start with the overarching theme of russia and the health of the economy and the health of the banking sector as well in the country. which angle should we be suing russia at right now? especially in light of what's taking place in china? >> hook at russia in two parts. in terms of balance sheets the country is relatively stable despite the decline in oil price. the central bank allowed the rouble to depreciate in terms of oil price. that's relatively stable. the question is about growth and this year what will be decline. we're expecting 3.5 to 4%

decline. >> and we're just looking over the past 30 days flat to a little bit lower and we're trading off just a tad. >> i think it's very unresolved business or risk. we know there's a great deal of soul searching. it's as to how tough they should be with the banking system. it's very clear to the central bank is allowing the banks to, if you like to use out dated risk measurements. they're allowing the banks to use exchange rate of last year rather than the current exchange rate. there's a big question mark as to what will be the level of nonperforming loans and how much money the banking system will need when the central bank finally gets around to forcing the banks to reflect the current situation. so the second quarter numbers, that's pretty much not an indication i would say of the

true state of the banking system. that's to be made clear in the 3rd or 4th quarter. >> what does that mean that they're using last year's exchange rates? >> in terms of calculating risks the central bank allowed the banks to use the exchange rates before the big declines. before the oil price essentially collapsed. so banks are assessing risk on exposure based on the rate much more favorable than the rate today. perhaps the 40s rather than closer to 70. so that situation has been rolled over into the autumn when that provision comes off and banks have to look at their real exposure based on the current exchange rate you'll see a big adjustment to nonperforming loans and you'll see which banks are exposed in terms of inadequate capital and risk coverage and that's when we expect to see a big shake out in a lot of the weaker banks which

is very much overdo business for many years but we think this is the crisis where finally chickens will come home to roost. >> i want to take a step back. it's the macro fears that is a concern for investors given the volatility in the u.s. markets and across the world about nearly a trillion dollars and outflows last week. that's a phenomenal number just to digest. does the story get worse before it gets better? >> the question really depends on china but that's such a huge contagion on emerging markets: we are coming up on the most dangerous time of the year. it's always september october when investors react to changing situations. there's always a reason why you delay if you like making tough decisions but come september and people are looking into 2016, if

that picture starts to deteriorate that's why you get big sell offs in october such as in 87 and back to 1929. it's a very dangerous time of the year and china and what happens in china is a very key part to it. if you look at the numbers there's still a considerable amount of money yet in the emerging market story from 2009 to 2010. i think you can still see a considerable amount of money yet to flow back into dollar assets but as it stands today there's still a question as to whether or not this is just a blip in the china story or whether u.s. will be able to raise rates or not. so there's a lot of people still sitting on the fence and will want to see how the numbers stack up. >> just from the conversations i'm having from investors it's the high level of uncertainty in the markets around fed policy

and around china and emerging market currencies to that matter pushing investors to the sidelines. but if had to look for some positivity give us a bright spot or something that is keeping you invested in the stock market. >> when you look at the china story, remember it was up well over 100% last year. it's still ahead if you like in an 18 or 19 month view. the underlying economy is slowing down in kai in a but it's not slowing down dramatically. it's still a very fast growing economy. there's yet no evidence that it's having impact on the demand for materials and oil. the oil problem is on oversupply and not on deteriorating demand. still looking for growth of 1.2 million barrels next year. it's a high production hefl. so as long as they feel like the growth numbers are still as we

heard early yerl, so long as the underlying economy remains relatively on track then we can get over this kind of sentiment driven volatility. the big fear is if we get a set of numbers that show a bigger slow down in china and it's the china story. if we get a slow down we could see a bigger impact on the oil price and bigger impact on currencies and take a big step down. >> in the meantime investors taking the fast boat out of china. thank you for joining us. chris weaver founding partner at microadvisory. we did see a dramatic reversal yesterday. we were higher and stocks faded into the close. the dow s&p and nasdaq all negative by almost 5% or greater for the year. tracking for the most negative year since 2008. just to highlight area of weakness, technology, 97% of stocks in the s&p tech sector in

correction territory or worse but right now futures are indicating a higher open. a similar set up to yesterday but we ended lower so we'll see. who know what is will happen in today's trade. >> strong call for the dow jones again. >> we saw this yesterday and ended lower. i tweeted earlier just like i know you have been looking at as well. larry sommers now suggesting or saying that the fed should consider another round of quantitative easing instead of tightening. we're asking you this morning do you think that's what we should be doing. should we be considering more quantitative easing. loads of you writing in. he says no way. austin says they aren't going to have a chance to do anything unfortunately. >> john says no, low interest rates are killing pension funds. there's no other choice than to raise rates and the fed knows it. i wonder how much they're thinking about pension funds at the moment. jeff asks if there's a betting

pool on the fed rate hike in the newsroom or among ourselves. no. maybe we should have a betting pool. you and i? do you think more quantitative easing or not? >> no, that's crazy. that's behind us. moving forward. >> the things you thought were crazy three months ago don't look crazy now. >> that's a good point. absolutely. >> we'll read out more of your comments on whether or not we should be k look at another round of quantitative easing. let us know what you think at worldwide@cnbc.com on e-mail or twitter. >> coming up on worldwide exchange, seeking shelter from the storm we'll speak to a fund manager with defensive plays for your portfolio. you got to stick around for this one.

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you can see the gains and losses we saw in one session. some blamed high frequency traders for the extreme market volatility. you can see we were down 249 points and up 139 and a significant move to the downside in the last 20 minutes of trade.

so how are high frequently traders playing a roll in this type of volatility? >> the debate started within hours on monday. was what we saw early monday morning that thousand point decline in the dow jones and quick bounce back, was that a flash crash or was that simply markets moving the way they ought to move? people arguing that it had flash crash like tendencies. it moves down so fast and up so fast, a lot of people arguing it was a flash crash was a guy at a firm and told me one of those that tipped him off to the idea was the fact that more than 50% of the trades in the first minute of trading were in odd lot sizes. that is not nice round numbers like 100 shares or thousand shares but 631 shares or 423 shares. that's the sort of thing he's seen in the past that's an indicator of high frequency

trading activity. it was machines versus machines in that first minute. it was all hft and that's part of what lead to the decline but i also spoke to the high frequency trading lobby. they say that wasn't it. they say they provided liquidity all throughout the day yesterday. one interesting tidbit here, they came out with a statistic today saying just 49% of the trading on monday was high frequency trading and they say that's consistent overall with the amount of high frequency trading we've seen in the month to date. 49% as well. a real debate here in the role on that sharp sell off monday morning and both sides pointing a finger at each other. >> you may be considering some defensive plays. our next guest is a cautious fund manager specializing in low volatility markets. joining us now is fund manager good morning to you. thank you for joining us during a time where really a lot of

investors and audience member versus been voicing their concerns around the volatility in the markets and the big question is where does one find refuge. >> good morning, yes. well, the challenge we have with markets at the moment is of course the traditional defensive assets. government bonds would always be where people point to as where to hide. yields are so very low it's not possible to make capital gain in those assets. if you're looking for government bonds to balance your equity position you're not going to be able to defend your portfolio. we're owning a lot of cash at the moment. cash and short dated government bonds. you'll see the top three holdings there. all very short dated effectively cashed plus 15% of actual cash and we can sit there while we watch for markets to settle down and look for tuns to invest back into equities. >> in terms of stocks are there

places an investor should hide. i was just looking at the heat map. two defensive sectors have faired the best. they declined roughly 8% over the last trading sessions. nowhere near consumer and energy sectors. is that where investors should be hiding now? >> you'd have been better off sitting in cash rather than sitting in equities or going down slightly lower than other equities but then think about what you might do for when the market recovers? at some point the market will rally and people will start taking a longer term view on the situation. there's many good value situations in defensive-type equities. the tobacco stock with good yield. the pharmaceuticals similar. >> what do you think the pension funds are thinking at the moment? we've been talking about this for quite sometime about what

it's doing to the pension funds and they'll invest in area where is they haven't been investing. we'll see a switch of how we think about risk and investing from the bigger funds. >> the biggest challenge you have is traditional market theory would say bonds are low risk. equities are high risk and of course that absolutely isn't the case in the market at the moment. bonds when they're yielding so very little, the risk is all to the down side. yields go back to historic levels and is riskier than they're intending. >> how about alternative investments like gold or even, i mean, we saw yen and euro buying as safe haichs that people don't want to be stuck with the dollar that had gone long for quite

sometime. how do you view commodities? how do you view the currencies? >> i think gold has become a bit of a problem, really, for investors like myself. historically we used to say we own gold because it's the ultimate inflation hedge but it hasn't been behaving in that way recently and if it's not, why are we owning it. so more recently we've not owned any gold so whatever and we have been tending to look toward index leads and so on and so forth and the challenge with gold is you can make a very simple argument that it's bull market through up until 2010 was as much driven by chinese buying and demand and excess of supply and demand than some concept of it as an investment asset. it's behaving much more like all other commodities now and actually the same point you could be making for many other alternative which is are marketing as alternatives to

equities and bonds but in reality they're exposed just as equities and bonds are so you need to look at supply and demand and what you'll get from those asset classes. >> are you seeing more demand when volatility is high for these type of defensive plays? >> we tend to with defensive funds such as ourselves. the client market that uses it are people looking at post retirement or defensive long-term investment strategy and you do seem to find that people take more interest than in extreme bull marks. they're focused elsewhere. >> david, thank you for being with us this morning. fund manager at miton group, thank you. >> thank you. >> let's get stock specific and tell you where we saw some weakness yesterday in tech. it continues to be a source of concern. 97% of the s&p tech sector is in correction territory or worse. including 37 stocks that are in bear market territory which is defined as a 20% move to the

downside for recent highs. micron tech leading the plunge. other notable tech stocks in bear market territory, apple, hp, yahoo! which is off 40% from the 52 week high. so big moves in the sector. >> yeah. >> alibaba's chief executive telling employees to keep their eye on the true prize and forget about the pane's share price. this as stock fell below the ipo price for the first time in yesterday's trade. the ceo urging his staff to focus on the customers at hand. he had faith in the chinese economy as well. alibaba joining twitter as the second high profile tech company to sink below the price in less than a week. >> but alibaba higher in yesterday's trade which is interesting to see one of the bright spots out there. but there are two tech companies that are are weathering the storm louisa. should we get the report? >> we should. >> julia is breaking it down. >> two stocks bucking the markets negative close on

tuesday, netflix and facebook, both hanging on to some gains during the day's rally. netflix shares closing up 5%. facebook shares closing up nearly 1%. they issued a note monday calling out netflix and facebook as two of the best pull back opportunities while they reiterated a buy rating on netflix giving it a $143 billion price target. mark cuban also explaining on cnbc's fast money on monday why he's holding on to his position and doubling down on facebook. >> it's driving the whole content industry so i have no problems of holding this for the long-term. i don't know what level it takes for me to buy more, but there is a point and i added to facebook. it's in a similar situation. it's driving the add economy and content consumption in so many different ways.

they're doing a lot of things right. >> they both have catalysts a head. netflix launching in japan on tuesday having just announced a partnership with soft bank and facebook is expected to cash in on its instagram adds and adds on other apps as it rolls out more ad formats. >> we've been asking you today whether or not you think the fed should be thinking about more quantitative easing after the former secretary talked about that might be a possibility. what do you think? find us on twitter @seema cnbc. we'll be reading out your comments later on. >> coming up on worldwide exchange, more on today's market turmoil. find out why burger king is reaching out to mcdonald's in the name of world peace.

china steps in with another cash injection. this is following the fifth rate cut in 9 months. >> roller coaster ride set to continue. u.s. futures pointing to strong gains for the dow just a day after the blue chip index staged it's biggest reversal since the heart of the financial crisis. >> the oil price continues to take it's toll on transocean. shares slumping ove