welcome to street signs. i'm julia chatterley. these are your headlines. european stocks, stocks to a high amid hopes of fresh fiscal stimulus. gdp disappoints going to 0.2% in the second quarter due to a decline in exports and capital spending. bigger and better. h and m shares getting a lift from sales as the fashion retailer continues its onlin and store expansion.

fall more than 3% after unlawful access to private company data. a company source says many companies may be at risk. warm welcome to street signs. it's monday morning. let me give you a look at the european market sessions so far today. we settled at highs for the european equity markets in friday's session and we're adding to those gains this morning. the outperformer, the kpet rah dax in the last six sessions. let me give you a look at the individual sectors. the autos, the health care oil and gas. wti adding more than 7% last week. this morning, there's reports of the russian energy minister

suggesting that he's consulting with the saudis and other countries to achieve oil market stability. it comes on the back of comments that we got from the saudis last week too. skeptic in me says i'll believe it when i see it. >> h and m as well in focus today after better than expected sales growth. just a quick check on the homebuilders this morning. jpmorgan lowering some price targets. putting a bit of pressure on that sector. japan's growth is stalled april to june annualized gdp grew coming in below expectations. this marks the second quarter of consecutive expansion. a slower pace than the first three months of the year due to weak cap x and -- abe economic

policies whether they're able to produce sustainable growth. let's check on that data and the markets. we're in -- >> there are a couple of things that dragged on growth. the external position continues to look very, very sluggish indeed. not seeing the export growth. japanese context, stronger yen is partly to blame there. capital expenditure. corporate japan simply is not confident enough in the economic cycle to really spend and deploy capital and reinvest in the business. that's why growth has been anemic. it's been sbeg ral -- let's face it, they've proven incredibly elusive in the japanese context. it was in mainland china

equities outperforming 7-month highs for mainland china. property in the financials, off of the leadership today. the growth numbers were pretty poor on friday which ever way you slice it. particularly on the fiscal side of the equation, that's where the markets are front running. the broad dynamic, julia, is that the yield in a negative and zero rate environment is over here in the asia-pacific region. whenever you see these dips, you see these yield that are aggressive, bid it higher. scaled a new one-year high. the data was pretty good. gdp 3.5%. you got to ask yourself, is that sustainable or the peak given the fact that tourism arrivals are on something of a downward trajectory and the coordinating attacks a few days ago on some

of the hotspots in thailand -- it makes up about 10% of the broader economy. that's where we stand, jewel yachlt back to you now. >> thank you. joining us is fixed income manager at aberdeen. let's talk japan. disappointing overall on growth for the last quarter. not unexpected. as i said, the concerning thing for me was the .4% drop in business investment. >> realistically, the story with japan is this is sort of the pattern we've seen for a number of years. it's fluctuations around the low gdp growth rate. while there have been attempts on the boj to stimulate the economy and lately trying to use fiscal, the realistic prospect is without the structural reforms, achieving a growth rate

above these kind of small 9.2 or 9.3 numbers is going to be difficult. >> we got that headline, 28 trillion d -- they're not even adjusting growth forecast beuse they're looking at the external environments saying this is going to add very little. >> exactly. the japanese yen, that strengthened and partly the reason we see low business investment is because the export market is going to be less competitive because of the strong yen. again, the -- the labor smarkt shrinking. until japan can do something about that, it's not a prospect for private investment. that means fiscal policy is unlikely to stimulate anything further down the lines. don't filter into gains in the future. >> this is the point with businesses as well. we're not seeing wanl gains or filtering into the inflation

numbers. >> if you get inflation and don't have higher -- that's a negative. the problem is that without the investment, there aren't productivity gains. firms won't pay high wages if they're not seeing productivity. it's a self-defeating cycle which hinges on them expanding their labor force. >> you make the point as well about companies need to go look at per capita growth as well and not just growth. i like this point. explain this. >> it's the difference between a government should be looking at and a firm should be looking at. the firm doesn't mind how much population it -- if it can see 5% sales growth. a government shouldn't be settling for that. it really cares about the welfare of its citizens, that should be measured by per capita gdp growth. actually, there's a slight die verge ens between what the two

sides of the community are looking at. the population is shrinking -- if you roll the clock forward 10 or 20 years. investors saying they don't bioowe others say this is a classic sign of a government enacting fiscal policy and a central bank not doing enough on the monetary policy side. >> that's an interesting one. a lot of people refer back to the 2003 -- see that as the prototype, if you like, for what might happen. the irony, if policy were to successful, that would be the -- if you have fiscal and monetary working together and we created inflation in japan, those people

who own -- it's a terrifying prospect. >> do we see a backup in yields until -- you're going of arguing -- >> if the market were of the opinion that the fiscal policy would be successful, then yes. but as you pointed out, the market has been under whelmed. actually, flow will dominate the bank of japan is a huge price insensitive buyer. >> the market. >> it's going up and up every day. >> james, you're staying with us. any fixed income questions for james. whatever country it is, e-mail the show. street signs europe at cnbc.com or on twitter. or at j chatterly cnbc. our other top stories. at least four people are dead as a result of record flooding in louisiana.

president barack obama declared a major disaster in the worst hit areas and increased federal funding for the area. the louisiana governor warns there is more to come with over 20,000 people rescued and 10,000 remaining in shelters. >> one woman made a lucky escape as emergency teams made this dramatic rescue from her sinking vehicle. >> wow. that's the first time i've seen those images. they also managed to save her dog. there she is coming up from the water. >> wow. the governor of wisconsin, meanwhile, has activated the national guard after violence and riots erupted in the wake of a fatal shooting by a police officer. protesters clashed with law enforcement, also setting multiple businesses and squad cars on fire on saturday night. this after 23-year-old smith was

killed while fleeing an officer who stopped his car. police in new york searching for a suspect believe to be killed on saturday. the two bangladeshi men were shot dead after they walked along a street in the borough of queens. authorities say they're yet to establish a motive and there's no evidence that the men were targeted because of their faith. the all clear given at jfk in new york's airport after reports of shots fired in terminal 8 on sunday night. according to authorities, two people have told police they had heard what they thought were gunshots. police squeubsequently cleared airport. there's no evidence that a shooting had taken place. a 34-year-old woman who was attacked on a swiss train has died. the attacker injured five other people setting fire to and

stabbing passengers on a local train. the knife man who also died was identified as a 27-year-old swiss man that police say his motives remain unknown and there's no indication it was an act of terrorism. what's the world coming to? we have to take a quick break. h & m july sales. how they're sustaining growth. we'll be discussing after the break. we're back in two. stay with us. get funky with your chicken. on average, one in 6 americans will get a foodborne illness this year. so, learn the right temperature to cook each type of meat. keep your family safe at foodsafety.gov.

(music plays from one way or another ♪♪ ♪ i'm gonna find y♪ i'm gonna getcha ♪ ♪ getcha getcha getcha ♪ one way or another ♪ ♪ i'm gonna win ya ♪ i'm gonna getcha ♪ ♪ getcha getcha getcha ♪ one way or another ♪ ♪ i'm gonna see ya ♪ (inhales cigarette) it may take longer for britain too leave the eu than originally forecast. this according to a report in the sun-times newspaper which suggests chaos in the brexit and

international trade departments could delay the triggering of article 50. the report claims britain's departure from. eu could be pushed back to 2019. a year later than had been expected. >> sticking with uk politics, 130,000 labor members have been barred from casting their ballots in the party's forthcoming leadership vote. this was ruled friday when they were unable to block a sizable portion of members voting in the contest. the decision was thought to benefit owen smith challenging jeremy corbin for the party leadership. monetary policy can only offer a, quote, short term ban for economic uncertainty. this according to policy maker andy held dane. speaking to the sunday times newspaper, the central banker added he felt enormous sympathy for savers in the wake of the recent rate cut, however, he defended the decision was

necessary to boost business and consumer confidence following the eu referendum. been a long time of low rates frankly. leading all other major asset classes in total returns in 2016. the long-term government bond have returned a 34.3% year to date with the yields tumbling more than 1.5%. the bank of england's recent rate cut and additional easing program have added to the asset's momentum. james with us, though. that's one heck of a return. >> not bad, is it? government bonds with a headline yield 1%. they return 30, 40, 50% is phenomenal. i have to slightly disagree with mr. hall dane. i am not sure while i agree that it's a short term bar, i'm knot sure in this intans. actually, there's an element of expectations being part of

problem here. when the central bank acts as if there are huge economic problems, people are sort of motivated to behave as if there are economic problems. that means the kind of behavior that's negative for the economy as opposed to positive. with rates down here and yields very low prior to this recent action, i don't think there's much left in terms of stimulus. conversely, the expectations and the confidence shock that can be actually exacerbated might well prove to be more powerful. >> they're not doing anything. also creates this panic in the market as well which filters through to consumers as well. i do feel for them here. obviously, we have to wait for philip hammond to come up with something on fiscal side. what do you make of the suggestion that article 50 might not be invoked for longer than we thought? perhaps the ultimate rather than the first quarter. >> i'm not sure that's that much

of a surprise. we have very little time for the government to try to give us a time horizon over which they expected to trigger article 50. as we know the relationship with the eu is hugely complex. having a new team in complex, needing to put stuff into that team means that actually it's more important that the job is done right rather than done quickly. >> agree. >> in light of what we saw the rate cut in the bank of england, global bond funds a tacted the highest for 18 months. i think it was five days after they cut rate we saw what, $10 billion invested in just five days. also huge into uk corporate debt as well as a result of the bond buying program. where would you be buying, she says, with all the negative yields out there? >> the irony is that i actually think sovereign bonds are a good investment. the main reason -- >> where? >> the main reason being that the system we've created is one that unfortunately relies on

monetary policy. while ever that's the case and while assets are expensive at the same time, you get a -- that is to say, if we keep on easing monetary policy, that's going to be good for sovereign bonds. conversely, if there are any sorts of wobbles and other risky facing asset problems, the safety should perform well then as well. >> what about yen? they've been one of the biggest beneficiaries since that rate cut. yield hungry. >> that's t i'd like to think there are more discerning invest toss not seeing numbers and buying the asset class. it does yield more. it's an asset class which has seen a lot of inflows over the last few weeks. >> actually, i've been told to wrap. one quick question here. there are some issue with the auction last week when the bank of england were trying to buy back longer dated bonds. was that investors going in and getting a better price here? >> it seemed to be. certainly at the prices that the

bank was willing to pay, there weren't enough willing sellers. it's 52 million. it's small fry in the grand scheme of things. the next buyback wept extremely well. i don't think -- there's a structural issue from the program. >> bidding up the price of -- yeah. awkward. james, great to talk to you. investment manager at aberdeen asset management. jpmorgan kept overweight expectations -- relatively high dividend yields and the possibility of further rate cuts from the bank of england should support the market. a quick look at the ftse 100. .3 of a percent higher. i can tell you in the last week, 1.8% high year to date. we're up 11% on the ftse 100. if you compare that to the german market. flat. 3.5% last year.

the ftse 100 significantly outperforming here. reported first half pre tax profits up. the home builder says underlying market remains positive and closely monitoring the impact of the eu referendum. shares are down over 17% as you can see. actually 19% so far this year. the private equity firm kkr is mulling a bid according to bloomberg. this is a week after the make of pepper pig rejected an offer from itv. sage has been hit by a data breach. the company says an internal log in was used to access data about

british companies. uk companies are exposed to the leak. that according to reuters sources. more than 6 million small and medium-sized businesses use sage technology. a sage spokesperson told cnbc they're investigating the unauthorized access but cannot comment further while working with authorities. shares in g 4s trading higher after naming tim weller as the new cfo. the largest security firm -- petro fak while he held the same role. they said weller aers experience would be invaluable for the finance team and broader transformation program. as you can see, that stock higher by 1.5%. outperforming the broader market. a takeover offer from gambling funds 888 holdings. the largest bookmaker says the

revised bid of 3.6 billion pounds continues to substantially injure v-- under value the firm. the unsolicited bid comes amid a surge in uk gambling sector m and a with them having mernld late in 2015. on course to complete their tie-up later this year. swedish retailer h & m reported a 10% rise in sales in july topping expectations as the store expansion continues. joining us is tony she rhett. >> what do you make of the numbers? >> they were okay. >> okay. >> this only a monthly number. it is actually the best month if you look at it on a two-year basis, which is okay. >> if you look at the weather,

it's been pretty good, too. which is helping. >> there are a lot of things that influence these sales figures. but yeah. clearly, it's been more focal in northern europe than previously during the year. that said, you know, sales piece got -- the context number of new stores they're opening which is like 12% year on year. >> that's huge, isn't it? they're increasing the number of stores. last month, they expanded on the e-commerce side as well. including ireland, japan and greece. the opportunity expanding it a huge rate. >> yeah. that's why people like buying stocks like hen and mauer its. they have global scaleability. >> the stock is down what, 21% in the last months.

>> the dollars hurt them because that's one of the top three markets, isn't it? the other big issue for them is they buy about 3/4 of their product in china. they're batting against a cost of product going up. you know, selling stuff in weak currencies. we're getting to the end of that cycle because the other thing that's been happening is the -- has been weakening and basically that will feed through in cost of goods in due course. but there's a lag. >> there's also fierce competition in this seg metropolitan of the market. i can think of a number of them. new look. even if you go online and use a comparison of new look, it's actually easier to buy these products and get them sent to them. even though they're expanding at

a breakneck speed in terms of commerce operations, getting those products is a bit of a pain. >> i think it's absolutely true that h & m is not up to speed in terms of online. it's been doing it for a long time, but it has been more recently behind in terms of functionality. you mentioned the countries that it's moved into earlier on. had a big surge in opening in big countries online about three years ago. we had expected that to feed through into better sales growth in those countries. ones you were mentioning. it doesn't move the dial in bulgaria online, fracly. >> colombia. >> exciting but slow. >> tony, you haven't got me excited about this stock. should we be? >> once we get through the next year, the kurpt year up to november, earnings will go up

again. the other big thing people look at is the ee bit margin is down from 23% to 13% this year. we need to see it starting to move forward. if you've got scaleability then you can buy it with can have deps. we want to see signs of that happening. >> that's a great point actually. they've been narrowing for three quarters. a challenge longer. interesting. >> tony, great to chat with you. thank you for your wisdom. let's move on now. american consumers ran out of steam in july as retail sales came in unexpectedly flat. steve lease man has the details. >> after spending at a solid clip in june, consumers gave their credit cards a rest in july. the retail sales report shows spending was flat after the 0.8% gain in june. the concern among economists is whether this is a pause or if

consumers have been holding up the economy, if they might be ending spending ways. a lot of month to month volatili volatility. there's going to be concerns that the economy might not be growing at all or there could be a potential recession on the edge. sales declined in sporting goods, department stores and grocery stores. gasoline stations fell a sharp 2.7%. don't get too panicked. that was the result of price declines. some wondered if they came from overall lower prices in some industries. auto sales surged 1.1%. online retailers, they bucked the trend. they saw sales increases. maybe that's an effect from amazon prime. whatever the reason, doubts about the consumer, that's another reason for the fed to go cautious on rates. we're going to take a quick break now. check out world markets live, our blog which runs throughout the european trading day to keep you abreast of all of the top stories. stay with us.

we're back in two.

welcome back to street signs. i'm julia chatterley. these are your headlines. european stocks, chinese markets surge to a 7-month high amid hopes of stimulus. japanese gdp disappoints. 2% in the second quarter due to a decline in exports and capital spending. bigger and better. h and m shares getting a lift from sales as the fashion retailer continues its online and store expansion. sage shares slip more than 3% after hackers gain unlawful access to private access to client data. they tell reuters 280 british companies may be at risk.

welcome back to street signs. let's take a look at u.s. futures. clearly several hours yet until the markets open. following gains that we're seeing in europe this morning. tilting to the topside of the dow indicating higher by 36 points. the s&p 500 just four points. we did see u.s. stocks breaking out to new highs in the past week that we saw the s&p and the dow posting gains. interesting for all the questions being asked about what drives these markets further. it was interesting, i read in barons this weekend, three stocks in dow contributing to half of the gains this year. 3m, ibm and unite health are the three. it was an interesting point. retailers in earnings to watch this week. let's take a look at european markets as well. as you can see, we've added to the gains in the last few minutes. that's now 4% gains in the last

six sessions. clawing back to flat for the year overall. give you a quick look at commodities this morning as well. wti and brent once again in focus adding to the more than 7% gains we saw last week in wti. a report this morning that the russian energy commissioner suggesting he's consulting with the saudis and other countries to achieve oil market stability. i made my skeptical comments in the first half of the show. i'll leave that there. gains this morning for spot gold and spot silver. the dollar on the back foot today too. that contributing to the gains we're seeing across the board. now joining us is james butter fill, executive director at etf securities. >> good morning. >> good morning. great to have you on the show. gold, should we be getting excited? >> we did have until friday. i gave to you you on friday.

we had pretty strong incompetent flows of 140 million on friday alone. that left the week in total of inflows of 120 million. >> some -- >> i can understand why some investors are getting jittery. we've seen four weeks of outflows in the particular gold etfs. the rest have been strong inflows. we've seen $3.7 billion of inflows if you look at futures positioning in a net basis. longs versus shorts, you see it is at a record high. where do we go from here? some investors are saying maybe -- >> enough is enough. >> maybe silver. why is gold so popular this year? we've seen no inflows into short positioning this year. usually when you see strong incompetent flows, you do start to see a group of investors decide to stop buying shts as

well. this time around we haven't seen that. we think it's three key reasons. one is uncertainty around what the fed is going to do. that leads to instability. we're already seeing market conditions in the united states start to tighten before they -- furthermore, you have popular politics. donald trump's most recent polls have risen again and you're seeing europe leading the polls in many countries too. finally, it's negative rate as well. if you look at the -- well below the cost of carry of gold. >> that's a great point. the cost is lower for gold than the likes of the bonds. it's an interesting to point out. you think it's a nonuseful asset to hold. >> absolutely. >> in this case, it's important. >> many people are looking in places within europe to part cash.

gold is an option now. >> we had a rally last summer and then the chinese came in and spoiled the party with their volatility we saw around their markets. one of the crucial differences between this year and last year is the rally we're seeing in commodities, the stabilization in commodities. what are you seeing in industrial metals. tied to china as well. >> they should have been improving last year. at that point, there were in supply deficit for three years' running. they traded well below marginal cost which is the same state today. >> yep. >> this year, we're seeing the first evidence of destruction. look at the bounce we've seen as well. it's likely that it will lead to

further deficits. we think the fundamentals are starting to reassert themselves now. last year was about expectations about the fed to hike the dollar and gold for that matter. whereas, now that seems to have alleviated and fundamentals are more important. >> underpinning for the market. the bounce that we've seen in oil, quite crucial. what are you seeing in the dollar here? >> the retail sales number we saw on friday, softness of gain in the rates market over just what the fed is going to do wh anything in year. >> it's likely that the fed's tone on wednesday, when they're released will highlight slightly more hawkishness. we're getting mixed data out. chicago confidence, consumer confidence data last week. we're seeing divergent opinions in our etf effects currencies.

we're seeing both inflows into both long and short. very mixed opinions out there about that u.s. dollar. >> we'll see. great to chat with you. james butter fill, executive director at etf securities. let's move on. republican nominee donald trump has attacked media outlets, including "the new york times," saying if its campaign were covered monday hehonestly, he w a lead over hillary clinton. speaking at a rally in connecticut, trump attacked media reports suggesting his campaign is failing. >> i'm not running against crooked hillary clinton. m i'm running against the crooked media. these are the most dishonest people. the good news is, i love -- i put down -- failing at new york

times. the newspaper is going to hell. they've got a couple of reporters in that newspaper who are so bad, i mean lack of talent. but it's going to hell. i think maybe what we'll do, maybe we'll start thinking about taking their press credentials away from them. maybe we'll do that. i think so. i think so. >> oh, dear. there goes freedom of press. tracie potts joins us from washington. tracie, our favorite subject. i read "the new york times" over the weekend. they were suggesting that he's confused, erratic. he doesn't understand why he's not getting the support he thinks he deserves here. what do you think is going on? his audience was quite interesting. connecticut, blue, through and through. >> that article he referred to, julia, was interesting. clearly, there were insiders frustrated about the direction of the campaign and/or the direction of the candidate.

while he's taking aim at the media, they are reflecting what people are telling them from inside his own campaign. the other thing that's interesting about this, his running mate, mike pence has typically been a champion of the free press, who sort of backs off when asked about what do you think about trump taking away kre depgss from "the new york times" as he's done with the "washington post." he says it's an ongoing discussion. they've made it clear that there are some areas where they disagree. while pence really doesn't air that publicly. this seems to be one of those areas. >> mike pence also very interesting when said he would release his tax returns shortly. does that also exacerbate the pressure on donald trump to do the same? >> sure. it puts some pressure on him. the reason that trump has given is because he's under audit. richard nixon was under audit and he released his tax returns. this is almost unprecedented in recent political history for a major political candidate not to

release his tax returns. tame kaine has done it, hillary clinton has done it. mike pence is going to release it. when are we going to see his tax returns. it looks like we may go to this election without knowing what his effective tax rate is as he and hillary clinton continue to argue and debate about what the tax rate should be for the rest of americans, for all the people voting for him. >> she's not going to let that go either. particularly in the debates. do you think mike pence is getting frustrated. i watched a couple of interviews again with him over the weekend forced to decipher some of donald trump's comments, forced to explain, particularly over isis and the founder of isis and blame that he places on clinton and obama. do you think he's a bit embarrassed by the situation now? >> interestingly, it was a child at his rally in north carolina who brought it to light and asked him that question. are you the cleanup guy for donald trump and now the media continues to ask him are you the

cleanup guy for donald trump. i don't know the frustration that he's expressing is with the media. in terms of what's going on inside, though, clearly there are some areas where these two don't disagree and they said up front, donald trump said up front, his style is different from my style. there's areas where we disagree. i'll listen to him where we disagree. this is not a team that's always going to be on the same page and we're starting to see that with donald trump going after the media and mike pence saying it's an ongoing discussion. wooe we're talking about that behind the scenes. it's private, so we're not going to talk about it. >> the cleanup guy. tracie, great to talk to you. tracie potts. crass troe made an -- it coincided with an article published by castro in which he reviewed his life and lashed out

at the u.s. we're going to take a quick break. coming up later on in the show, we'll be talking e-games. what does that mean. a laup much at the rio olympics. stay with us. we're back in two.

♪ ♪keep on the sunny side ♪always on the sunny side ♪keep on the sunny side of life♪

♪keep on the sunny side ♪always on the sunny side ♪keep on the sunny side of life♪ talks between -- the pilot's union dissolved without agreements make. it's been under way for four years. the parties have been locked in closed door discussions since may. no further discussions are scheduled. lufthansa shares lost almost a quarter of their value so far this year. germany's motor transport authority approved technical

fixes for an additional 460,000 volkswagen engines. they're used in the polo and other models. this brings the total number of vehicles with approved remedies with over 5 million following the emissions scandal. volkswagen shares currently trade 5% lower than pre-crisis levels. competition in the electric car market is heating up in china. yun takes a look. >> you probably haven't heard of ch auto for good reason. from beijing, the company has designed and produced cars for other chinese car makers until it made this. china's first homegrown battery powered roadster and competitor to tesla's model s. the k 50 is the brainchild of

founder, an engineer by trade. lue worked at jeep in china. then he created his own brand. it means the future in chinese. >> translator: china is already the biggest auto market in the world. without a doubt, it will be the biggest market for electric vehicles. we think it's very good in such a fast growing market, the government has provided guidance and insenn tifrs through policies. >> it wants locally made hybrids and electric cars to expand tenfold to 3 million by 2025 to reduce pollution and help china become a technology leader. several i.t. and car companies including ch auto are rushing in to compete. >> you can see here, our engineering -- >> what's your competitive edge over tesla? >> translator: the exterior of this car is made of carbon fiber materials while the interior is

mostly aluminum alloy. it's completely different from tesla and others. >> the lightweight carbon body and aluminum frame are meant to improve performance. >> one of the challenges that the government faces, it has to roll out all the infrastructure to make sure energy efficient cars are appeal to the public. the government set up charging station like this one in the big cities like beijing, but it has a long way to go. >> even so, ch auto is investing $300 million into a new factory to produce the k 50. it could price higher than tesla when it debuts in 2017. >> translator: people often think made in china cars sell at the low end leaving an impression that chinese cars are cheap and poor quality. we want to change that impression. >> along with the future of china's car industry. eunice yoon, cnbc, beijing. in talks about atting app to

apple tv. the same report says the micro blogging site is in discussions regarding other streaming deals with major league soccer and the professional golfers association. this is after denied rumors it could be shutting down sparking a frenzy on social media. athletes -- as athletes across the world compete to bring home the gold for their country at the rio games, another group of players are competing in the virtual world. >> this is a two-day pop-up event to offer the world a glimpse of competitive gaming. ceo of e-games group joins us from rio as we speak. chester greet to have you on the show. >> what are you launching and what game are people playing? >> yes. so we're launching a new international e-sports

competition, which is competitive video gaming. it's based on medals only as opposed to prize moneyment currently a lot of the sports competitions are all about prize money. what we've created with support of the british government is the medal-based version of that. today, we're doing a show match of a game called smite and tomorrow is the main event, an 8-country competing in the game called super smash brothers. >> smite. >> so smite is a fancy play game where you play five versus five. today, unfortunately, we're -- the british olympic house. we have restriction in the room. it's going to be 3 versus 3 and super smash brothers will be 1 versus 1 which is kind of the format it's played in. >> e-sports generated global revenues of $500 million last year. it was a 25% rise on what we saw in 2015. what kind of growth are we

looking at and i guess, another question for me is, why would i want to watch someone else play a computer game? >> so the growth is amazing. there are a lot of brands getting into e-sports, particularly because it's the hard to reach demographic of children and people of the age 12 to 24. they aren't watching tv anymore. to get to these people, they're gaming and watching gaming. an interesting statistic is that people are watching these gamers game 40% of those actually don't play the game that they're watching. there's a general interest in this. it's a skill set. there are -- part of the thing we're doing is promoting e-sports is good for you. there's really good life benefits and cyber skills as well. all done in moderation, which is what -- it's part of your balanced life. i think there's a growth and acceptance more by parents and brands that e-sports is actually good for you.

>> your dem grafgs here incredibly important because you're targeting and getting viewers like millennials involved here. >> yeah. so the reason why we've established what we're doing on the e-games is the fact that we're concerned that e-sports was going down, all about moin rather than national pride. sorry. like in any traditional sports, like you have in tennis, you have the davis cup and in golf, the ryder cup and obviously here the olympic games. >> as you just mentioned there, you're doing this for an award rather than for money. as a business, how do you make money? i know you're not for profit. but where is the money flowing here? >> yes. what we've had is for rio, we're part of a showcase in british house. we've delivered and not had any sponsors. we've had a huge amount of response about sponsoring teams and countries and future

e-games. sorry. going to cough again. sorry. who like the fact that it's not about the money. it's about national pride and we can inspire future generations. they're brands that haven't liked spob soaring e-sports up to now. it's all been about prize money that's gone to the players. this weekend, there's a event called delta 2 international in seattlend the prize money was $20 million. >> wow. that's incredible. >> i know. >> i know you're coughing. i'm going to ask you another question even though you're struggling to talk a little bit as well. what about advertising opportunities here. if i look at the breadth of scope much viewers. some of these things i've seen, 40,000 people watching live in some cases. tens of millions of people watching over the web. i mean, the advertising opportunities, particularly if you're a target audience is millennials, that's a huge opportunity too, surely.

>> yes. there's a live stream called twitch. that's the main live streaming site where people watch e-sport and they've done a brilliant job to bring it to forefront for the media. the intel extreme masters in poland about six months ago, there was 120,000 people watching it live. but 25 million people watched it online. >> fascinating. chester, thank you so much for joining us and well done managing the cough. chester, the games in rio. ryan lochte and three other american swimmers were robbed at gunpoint saturday night in rio de janeiro. lochte told nbc news an exclusive interview that armed men with a badge pulled the taxi over and demanded the swimmers wallets. none of the swimmers were harmed in the altercation.

a record -- 100 meter olympic gold medal. the jamaican athlete stormed ahead of his closest rival, justin gatlin with 30 meters to go in 9.81 seconds. the victory brings bolt closer to his aim of reaching, quote, immortality by delivering a historic triple, triple of olympic golds when he competes in the 200 meters and the 4x100 meter. what a legend. a tear full andy murray has become the first to win two titles after defeating juan martin del potro by 3-1. it was one of the toughest he's ever played in. he made it look tough as well. he cast doubt whether he would compete at the tokyo 2020 olympics. saying he was unsure if he would be at the same level in four years ago time.

who knows. might be better. justin rose has the first gold medal in golf in 112 years edging out henrik stenson by two strokes take the top spot. rose made a hole in one on the first day of play shot a 4 under par 67 in the final round. let take a look at the medal tally. team gb climbed into second place. how exciting. with 15 gold medals so far. wow. i'm impressed. >> i want to bring you a few comments about russia this morning. we've been talking about the oil comments and the suggestion perhaps that they will do something to increase oil market stability. we're now talking about tensions with the ukraine. obviously in light of the ongoing agreement. russian foreign minister saying he doesn't think anyone is interested in cutting diplomatic ties between russia and ukraine

yet and that russia is ready -- incursions to western partners. >> let me give you a look at the european markets finally as we head to a close for today's show. losing a bit of ground actually in the last 20 minutes or so. still in positive territory. a quick look at u.s. futures. adding to gains we saw in last week's session. remember, record highs touched once again for the u.s. equity market. that's it for today's show. i'm julia chatterley. worldwide exchange is up next. so don't move a muscle. see you tomorrow.

♪ ♪keep on the sunny side ♪always on the sunny side ♪keep on the sunny side of life♪ ♪keep on the sunny side

♪always on the sunny side ♪keep on the sunny side of life♪ good morning. crude climbs. oil prices higher with saudi arabia on market stability. >> follow the money. the latest -- the likes of david teper and dan lobe are buying and selling right now. >> plus, going for gold. usain bolt comes frp behind to prove he's still the world's fastest man. it's monday, august 15th, 2016. worldwide exchange begins right now. good morning. welcome to worldwide exchange on cnbc. i'