a bigger move this morning. you're looking at a longer chart. a bigger move around the market open time. doesn't seem like there was anything that triggered that. could have been some positioning. >> despite strong data we had out yesterday. >> precisely. >> fears over the hard brexit seems to be. we're watching deutsche bank today. first day of the week back in action after that holiday in germany yesterday and now the deutsche shares are re-opening to the upside. higher by 3%. this showing optimism bank can

reach a settlement with the u.s. justice department. deutsche bank got a vote of confidence from a big name and that was jpmorgan. jamie dimon telling cnbc the lender will be just fine. >> there's no reason that deutsche bank shouldn't get over its problems and i should point out there are two different -- they are both created by government which is the legal settlement which if you can create there would be good for them and this ongoing capital confusion where people don't know where rules end up. they have policemen of capital, plenty of liquidity and we want all these banks to get through because it's better for everybody. >> julia is in frankfurt. does it make any difference at this stage? >> jamie dimon is right for a couple of reasons.

deutsche bank's position is pretty comfortable. three times the size than during the financial crisis. even analysts at goldman sachs say 60% or around 60% of its liquidity here is in relatively low volatility form, so, you know, how many banks do you know that have gone out to businesses as a result of some type of capital crisis. liquidity is the problem. this gives them policemen of scope to get liquidity from the european central bank too. the second reason he says this he knows if a bank like deutsche bank gets in trouble then a big bank like his, jpmorgan will feel the reverberations. there's many reasons for all these banks to stick together and to boost confidence. the rally that we're seeing in deutsche bank stock today is a bit of catch up, actually on friday's session in the u.s. with the adrs and we saw that rally on some kind of optimism. we're seeing a level of uneasy

equilibrium. we need to know what this settlement will look like. we have a settlement of around $5.5 billion. that gives you a sense how this thing can move. this is a short term issue of resevere perativer ber jagseve-n the stock price. he has further restructuring to do. the weight of the business remains focused on investment banking. they have technology that needs updating and to go to the point that jamie dimon made about capital yes he believes it's comfortable but they still need to add more. these are all-big questions that come around and after we get this big settlement and we just have to wait for that. back to you. >> for more perspective let's

bring in managing partner of alternative investments. thank you for joining us, david, on this morning we continue to watch. a lot of the upside we're seeing this morning is on hope that perhaps that settlement will get closer to the $5.4 billion well below the 14 billion. is that being optimistic? >> it's very early to tell what the figure will be. however what's true is that we have experience in the past on other litigation to see the amount of settlements being far away from the final settlement that banks have. however looking at deutsche bank right now it might be a bit early to buy although what is very clear for us is deutsche bank will not go bankrupt any time soon. just a matter of restructuring. a bank that has a lot to do.

a global system bank. the main reason why you need capital is because their system -- they have time. they have until 2018 to do that. they are on the path of rebuilding the business, restructuring the business but it will take time. as far as the metrics, capitalization is more than okay. >> is there a number for the settlement that's too high, assuming it gets below that $14 billion level what do investors want to see that's comfortable? >> if we look at the reserve right now of deutsche bank it's $5.8 billion. what's very clear is that even if the settlement reaches only $5 billion you have to add to that 2.4 billion euro charge which makes the current provisioning not enough. so whatever the figure, they will need to add more money. but it can be not only capital, they can sell some assets.

they have deutsche bank which can be sold for 50, 60 billion. they have a bank, 20% which can be sold. >> david, you point out a very overcrowded banking marketplace in germany and i just want to quote the numbers you give us. a quarter of european banks are german and one bank for every 40,000 inhabitants. compared to every 60,000 in europe as a whole. >> yeah. this is really one of the main problems that we have. so very clearly spain was in this situation a few years ago and that's what the key thing spain with deacon so lie addition that happened quickly. greece was in the situation. italy still in the situation. so the two large countries overcrowded from a banking standpoint are germany and italy. it clearly weighs on

profitability. >> in terms of profitability, i mean this is going to continue to weigh on the sector or see banks do quite well in this environment. they come to terms with this earlier, made their changes whatever they to do. could we see a possible divide? >> well, i think we couldn't see that unless the german market conso lie dates. it's much too early and we look at the return on equity on average in german you're far below 5% which is way below the average situation. so, i think if we don't get a consolidation in germany and restructuring of the banking landscape with it ill weigh on the private german banks like deutsche bank bank or commerzbank. >> there were reports deutsche

bank, commerzbank coming together. very quickly quashed. >> yeah. well, i think the first thing you probably have to do is consolidate the public banks and the -- it's all about deficits. you can imagine how much they are suffering currently with the negative, let's say interest rate situation. this part needs to consolidate very clearly. >> i've heard people say oh, this could be like lehman. personally not that it matters i might disagree with those scenarios. what are your thoughts? >> there's no comparison. lehman brothers was a broker dealer. deutsche bank is a universal bank which is located in europe. in europe as a bank, deutsche has full access to the ecb liquidity and we have to keep in mind in europe, the euro system

is built in to give limited liquidity and funding to banks. so even though. deutsche bank would fall short of its 215 billion of currently quid position they would still have access to the ela which is the emergency liquidity assistance. there's really, for me there's really no comparison. >> david, thank you very much. we always like to hear from you because you have so many perspectives out there and find us as usual on e-mail. "street signs" @europe cnbc.com. >> find us on twitter as well. the show handle is @streetsigns@cnbc. >> good morning to all of you. get in touch. still to come, abb rejected

shareholder calls to separate it $11.6 billion power grid business. we'll first hear from the ceo straight after this break.

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. good morning and welcome back to "street signs". abb has rejected shareholder calls to separate its $11.6 billion power grid business at its investors day. let's get out the caroline who joins us from zur rim with a very important interview. >> reporter: good morning. i'm joined by the ceo of abb, ulrich spiesshofer. thank you for taking the time. a big day four. let's cut to the chase. why are your keeping the power grid business?

>> we concluded jointly with our board that the best option to create value for our shareholders is retaining the business and transforming it under abb's ownership. we've listened to all the expressed views very, very carefully. we've listened to the customers, the market. we have a program to create a story for our shareholders. >> reporter: the power with the power grid business it's suffering from low profitability. >> this business is the profit leader in the industry and naturally in our portfolio it's not the best performing so what we're doing is driving a transformation that would support with increased margin target of 10240% to go forward. we're changing the offering, changing the business model. we'll move stronger to engineering and software and services. we are also changing the

business model. we're take out large parts of activities by partnering the floor so the change in the business model, changing the offering all together that will support the margin of this business. >> reporter: cnb capital has been pushing for a spin off of that operation. with it they say abb is too complex, you can't manage the business well enough, it's too difficult. do you agree with some of that? >> look, it is very important for me as the ceo to listen to all expressed views and all shareholders out there. it is one of our largest shareholders. we listen to them very carefully. the observation is this business has tremendous potential. i agree with that. i agree there's a lot of potential in this business. there are different ways of attacking the potential. transformation on the ownership is an option we have chosen after careful consideration of old the options including the

one that was suggested. >> reporter: have you spoken to them about that decision sydney guess the calls or pressure on that business is really not going to go away. >> the performance pressure that they put on all of our business will never go away because we want to become better. last time i talked was this morning. as usual capital markets i called my large shareholders to inform them what we are doing. >> reporter: the bigger question is whether a conglomerate works. whether it crates value for shareholders. take a look at your stock price. that's underperformed in the last five years. we've seen that recovery trade this year but why do you think that a conglomerate makes sense? >> the last five years the stock price development was not satisfied. that's the reason why we launched. its paying off. if you look at the stock price development since january we had the best performing stock on the

smi. we're moving in the right direction. now let me explain to you what abb brings to each of our four businesses. its growth and its cost benefits. on the growth side we launched today abb ability which is the unique digital offering that helps our businesses to differentiate bringing value to our customers out there. cloud based technology, software solutions on the asset management side. on the cost side we have fantastic supply chain exercise going on and its approached maybe yielding about a billion improvement every year across the portfolio. look at how much we're spending and how it's good with our customers and suppliers and supply chain efficiencies and get it up. all together we're providing oxygen to our businesses by giving them a growth support on the digital side and giving them very, very direct cost

proposition. the last point let me mention is on the g and a side. we have lower sales administration costs than standalone companies than rockwell. they are about 500 basis points above abb in administration costs. threw see what the group can do. you should never be happy. never be satisfied. that's the reason why we increase it even further our productivity target by another 30% to make sure we stay ahead. >> reporter: you're launching another $3 billion share buy back program. i wonder why you're going down this avenue. are you not seeing enough value in the market in terms of m and a. >> first we have a lot of opportunities to fund our growth. digitalization is one of the big examples. we will continue with our dividend policy as a key pillar. look at m and a but they don't

splash money out. we do it on highly value graded activities. at the moment there have been known in the pipeline that we realize sod far. if you look at the cash machine that abb is we're planning another buy back program and should we need more capital that goes first. >> reporter: we've seen stabilization in oil prices and we have this opec cut announcement just last week. many of your clients are in the oil and gas and mining business, some of your rivals have said those businesses are, in fact, bottoming out. your seeing that? >> definitely see a tendency that the deterioration is slowing down in some areas but bottoming out on others. i don't have the crystal ball. one thing is very clear some parts of this market will come back. we're staying close with our customers at the moment. we invest significantly in technology to give them more

uptime speed and yield in difficult times where it's important to be highly productive to get good yields despite tough oil price. >> reporter: thank you so much. ulrich spiesshofer ceo of abb. on that note let me send it back to you. thank you. we want to bring you up to speed with some comments coming from ecb executive. a lot of heightened attention on the banking sector in europe. peter pratt has come out profitability will continue to come under pressure if the slump in profitability persists. he's been pointing out the banking system in europe is much stronger than it was during the financial crisis and interesting to note he has said he would like to see some cross border bank mergers which this gets what our guest was saying a few minutes ago about the sector is too crowded, perhaps consolidation is on the way.

these are the comments coming from peter pratt. return of equity of the significant euro area banking group remains below the cost of capital. this will have an impact on profitability. but the system is much better today than during the financial crisis. look, let's cross out and check in on our markets in asia. china on holiday. all of this week. also oil impact we were talking about yesterday. all green screens today. >> good morning. good to see you. looking constructive but as you said there's a large sway of further liquidity and turnover that will be the case for the duration of this week with mainly chinese equities closed. however, i think our markets did a pretty good job of shaking off a softer wall street but the real traction was in the u.s.

dollar against the japan's yen after the upbeat manufacturing numbers so that weaker japanese yen constructed for tokyo, nikkei up almost 1%. the other thing is that we have central banks meeting this week and today. the rba, first policy meeting under the new governor, rates unchanged, but warning about the strength of the australian dollar. elsewhere we got the rbi, reserve bank of indian. first policy meeting under a new policy committee and a new governor urging patel. looks like rates will be on hold. inflation is benign. it gives the rbi some room to maneuver and some scope to cut rates between 25 and 50 basis points towards march 2017. the other factor here is asia

has had a pretty good ride this year so far especially after brexit because this is where you find yield and problem bay capture the yield in the fourth quarter as well. clear and present danger really coming from the external situation be it from the european banking sector in your neck of the woods and deutsche. that hasn't been laid to rest yet. there's contagion issues and then the u.s. election and the risk of a december rate hike. that's where we stand. >> we'll keep an eye on that risk with nonfarm payrolls this friday. >> 170,000. that's the pect >> i can't believe we're there already. christmas before we know it. let's bring you up to speed with the other movers. there's plans to slash 3,000 jobs from eriksson. it will cut jobs in production and stealsnd seven and development in sweden as part of its cost-cutting program.

it will recruit 1,000 research and development positions over the next three years. they are up .7 of a percent on a broad upside day for europe. when it comes to ryanair flying air. low cost carrier transporting 10.8 million customers which is an increase. ryanair has reiterated this morning that average fares are likely to fall by 10%. giving you a check on edf, france's highest administrative body allowed the utility giant to retroactively bill its customers. it's expected to generate a billion euros. eds share price has fallen around 30% in the last year over concerns on the pressure that the project is likely to put on that firm's balance sheet. shares getting a bounce of 1.5%.

some unhappy customers i would imagine. >> might be the case. where you go? where do you put your money? our next guest has looked at the global markets and picked out a couple of equities that he thinks are the bees knees and which investors they should be keeping a special eye on. the head of equities is here. welcome. so give us a couple of names. what are you looking at? i saw a name in the solar power arena. is it a good time to invest intern energy? -- in alternative energy? >> solar energy is a good time. tough time to bottom in these industries. what's happening currently in that area is very interesting. last week there was an offer of

2.5 currents per kilowatt in abu dhabi for a plant which is the lowest price i've ever seen. prices have never been solo. yields have never been so high. it's really interesting, really getting competitive. so if we're not investing now it might be never because what's interesting also is the fact you don't have a very disciplined, not much discipline within producer. there's capacity. stocks are going down but we think at these levels we're currently owning a few stocks. we have five stocks which represent 35% of the production capacity. the combined market cap is 4.5 billion. if you put the oil and stocks together -- sun spore an interesting name. we like it on the convert side. they have a few converts.

they have high yield, some of these are trading at 10%. so we believe they will make sure these guys survive as their option plan b for the future. >> we kick off the new quarter m and a among the topics, netflix, twitter, perhaps and give credit where credit is due when you were on in march you mentioned linkedin. are you still looking at m and a as a value driver and if so where? >> it's more difficult now with netflix and twitter. twitter we're not really interested in the stock so far. we believe the valuation is slightly too high. we don't see much value. people tend to forget it's a company that's losing 2 million per day that's paying outrageous stock comps. that has not much data, not much ip either. so we don't have big plans.

>> up say you're shorting turkey. because of the political environment. >> yeah. turkey is interesting, what's happening. you have 32 people -- 32,000 people in jail. you have the turkish army is in syria as we speak today. you have collapsing tourism. the figures just got released. for august tourism was down 37% year-over-year. tourism is a big part of the turkish industry. so there are some names that are going to be impacted by what's happening. and moody also downgraded the country last week. beer is very important for tourism. selling a lot to russia. so the russian consumer is not doing very well these days. so we believe there's some down side in that name as they are

still trading at a higher premium, higher valuation than heineken and karlsburg. >> thank you very much. now we need to take a quick break. do keep your emails and tweets coming through. street signings you're up at cnbc.com or find us on twitter. we'll see you in a second.

. good morning and welcome back to "street signs". good morning. i'm louisa bojesen. your headlines. >> sterling sinking to a 31 year low against the dollar helping the ftse cross 27,000 mark for the first time in 16 months. now deutsche bank will rally this morning after the bank holiday amid a vote of confidence from jpmorgan ceo

jamie dimon who tells cnbc that there's no reason why the lender can't get past its problems. and abb holds on to its power grid business. >> the observation is that this business has tremendous potential and i agree with them. i fully agree that there's a lot of potential in this business. there are different ways of potential. transformation on abb ownership is the option that we have chosen. the eriksson announces plans to cut 3,000 jobs. part of its cost-cutting plan. >> welcome back. the data keeps coming. uk construction industry we're seeing it this morning shrugging off the post-brexit vote slump

as we've seen in the data. the pmi 52.3 for the move september versus an august reading of 49.2 and well above the reuters poll which had been expecting a reading closer to 49. so that means -- it's a nice expansion. 52.3. we heard of course yesterday talking about the importance of putting more housing on to the market and southeast things that the government will do is try to come to terms with the supply-demand gap. >> many comments are giving attention construction than previously before brexit because no surprise manufacturing get a boost from a drop in sterling. construction not so much. there was a lot of concern around construction specifically in the wake of the referendum. what does it mean for the bank of england. >> maybe they are worried about

inflation when they look at sterling. let's give you a check on how u.s. markets are set to open. we're seeing a bit of green on this screen after we saw a bit of weakness for the first day of the new quart. now a gain for the s&p 500 called higher by less than 4 points. do you jones called higher by 29 and nasdaq by 15 points. nice rebound in europe today with all major markets holding in the green. ftse 100 the leader here. we were telling you a moment ago getting a cue from the weakness in the sterling. the ftse is up by 1.2%. dax gaining from strength. rally in deutsche bank. the cac is higher by .9% and ftse higher by 3%. we told you about the sterling moves this morning. 31 year low against the greenback just eefrl now off half of a percent. euro also showing some weakness

off about .3 a percent. the greenback moving higher against the japanese yen and swiss currency as well. tuck chancellor for the finance minister has warned of turbulence as europe navigates brexit. speak at the conservative party conference he called himself a conservative pragmatist as he dropped the reduction target and pledged to prioritize spending on new homes and on transport. the chief executive of the british bankers association joins us from the conservative party conference in birmingham. good have you with us anthony. i was listening and watching the entire speech that was given yesterday at the conference. what did you make of the speech? what were the main takeaways through a banking perspective? >> well we welcome the fact he's committed to trying to do everything he can to promote stability because one of the concerns about brexit for us as an industry wasn't the day that the referendum results where the

government was committed to leaving the eu but actually when we do leave the eu in two years time, that's when the real uncertainty comes about about whether banks in the uk can carry on customers and whether eu banks can continue serving customers in the uk. we want as much clarity about the road map for that, how that's going to unfold and that involves having transitional arrangementsetween the uk and eu to make sure the bank can continue to serve customers. >> because, again, listening to what hammond was saying yesterday, he pulled a mario draghi but from the banking perspective are they the most important things that you would need the government to do in toward stabilize the banking sector? >> well, the most important thing we want for the moment, obviously we want a stable macro

economic environment but in terms of the brexit negotiations what we want is make sure there's sluft clarity and certainty as possible how the uk financial services can carry on serving customers. that means two things. one means starting negotiations about the future partnership between turk and eu 27 while we do the article 50 divorce arrangements. there's one line of argument that's been promoted by people in the eu you have to do the article 50 arrangement, divorce arrangements. before we start the talks about the arrangement. that will create huge uncertainty. a cliff effect as we leave the eu. second thing as i said before an early commitment as early as possible across the eu to transitional arrangements between where we are now, very integrated single market financial services and where we end up to make sure we don't have a cliff effect. make sure there's a smooth

orderly transition between the current situation and whatever the future is. >> as part of that early transition the message we hear from banking executives both here ting and those in the eurozone banks is they want the continued financial passport, continued access to the single market. when you listen to teresa may saying a hard brexit is on the way, should bankers be worried? >> so, all the noises we're hearing are worrying at the moment but we should draw a distinction between single member ship in the market, the norway solution where you have to abide by the rulings, have to have freedom movement of labor so it looks certain government will reject that as opposed to having access to the single market. that's very important. that's done underpinned by passport at the moment. passporting is the right under the legislation at the moment for banks in the uk to serve

customers directly without having to get retowards and it works the other way. banks in eu 27 serving customers in the uk. what we want to passaic sure passporting or equivalent of it continues. it's not just about banks but bank customers. corporates in germany to come to london and raise money for finance or come here and hijt rate and about banks and companies in the uk being able to serve by european banks based in london or elsewhere in the uk. >> does it frustrate you when you listen to comments from policymakers say we could be grabbing jobs from london when it seems you're suggesting the passport would be good. >> we're in favor of competition. if france wants to cut tax to help promote business and make it more attractive that's fine

by us. we're in a very unusual situation. normally in trade talks there are barriers in place. tariff barriers in place and people negotiate to reduce those barriers in order to increase trade. the eu is doing that with the u.s. and canada trying reduce barriers to increase trade. what we're hearing now in the eu we got basically no barriers in place already. some people in europe saying we need to put up barriers to reduce trade. that isn't good for the eu 27, isn't good for the uk. i know most of my numbers across europe also want to retain this single market in financial services so the banks can carry on operating across temp u 27 and the uk as they do at the moment. it really isn't in europe's economic interests. isn't in the interest of growth and jobs to put up barriers to reduce the trade between the ukker and eu 27. >> thank you so much for joining us. anthony brown chief executive at

the british bankers association. meanwhile we are keeping an eye to the race for the white house. hillary clinton has now branded donald trump the poster boy of a rigged tax system. this follows the "new york times" report over the weekend that trump could have avoided paying taxes for 18 years after declaring a nearly $1 billion loss in 1995. clinton made the comment at a speech in the swing state of ohio where her republican rival leads in the polls at the moment by five points. >> i was reading an article this morning pointing out that the line about being a financial genius or a genius in terms of coming up with this. the article's point was well you lost almost a billion dollars in a boom market in 1995. it was a boom market. donald trump meanwhile has taken criticism for comments that he made during a q and a session with military veterans on tuesday. speaking about helping veterans trump said quote when people come back from war and combat

and they see things that maybe a lot of folks in this room have seen many times over and you're strong and can handle it but a lot of people can't handle it. he's getting quite a bit of flack for that. the vice president's turn for a change. vice presidential nominees mike pence and tim kaine will face off tonight in until kaine's home state of virginia for their only one on one debate before the election. let's get out to tracie potts who joins us now from washington. what should we be watching out for tonight and perhaps the bigger question is will it matter to the overall campaign because there's been some staggering numbers on the lack of recognition for these two vice presidential nominees. >> reporter: interestingly considering one is a senator, one is a sitting governor, the other has been a governor. but they are not as well-known as donald trump and hillary clinton. and tonight will be the only chance we get to know these two candidates in a debate format. it is their only debate.

it's 90 minutes. we could end up seeing, you know, the thinking is we may see less fireworks, the personalities here aren't as big or as you noted well-known as clinton and trump. so we may actually see a debate that's much more focused on policy. mow mike pence is already in virginia. this is not his home turnovf. he was there yesterday for a rally. he wants to talk about hillary clinton's record. he made a comment in his rally that he could spend 90 minutes of the entire debate just talking about hillary clinton and foreign policy. giving you a hint at what he might want to focus on. tim kaine off the campaign trail like hillary clinton was before her debate presumably getting ready for this. pence may find himself on defense answering questions about donald trump's taxes, donald trump's foundation, the comment on the vets with ptsd and tim kaine may find himself on defense talking about some of hillary clinton's latest

comments, the basement dwellers, the bernie sanders supporters and the clinton foundation and we may also see them grilled on areas where they have disagreed with their running mates. both of them have disagreed on the tpp that trade deal that now both hillary clinton and donald trump say they are not behind but at one point both mike pence and tim kaine were. >> all right, thank you for bringing us that preview. we'll be watching the comments perhaps very late tonight and earl tomorrow for us. now the u.s. has broken off talks with russia over a cease-fire in syria. washington said that moscow has failed to live up to its agreeme agreements. a russian spokesperson said the u.s. was trying to shift the blame for the collapsed cease-fire. the decision signals a deepening rift between u.s. and russia. hundred much protesters

rallied against german chancellor angela merkel immigration policies in germany as the country celebrated 26 years of reunification. protesters members of anti-islam movement took to the streets thought merkel must go. earlier the chancellor was cheered to mark germany's reunification. there were counter rallies and shouted back to demonstrators on the sidelines of the protest. coming up here on the program a u.s. carmaker sees an unexpected drop in sales after six years of steady growth. is the market in a need for a pit stop? we'll be right back. find us on e-mail. on twitter. we'll see you in a second.

. hi, everybody. welcome back. you're still watching "street signs" this morning. abb has rejected shareholder calls to separate its 11.6 billion dollar power grid business. the swiss engineering group made this announcements alongside a 3 million share buy back program at its investor day. caroline, good to see you from another place but still with us. what's the message from abb? >> reporter: the message is that they are hanging on the power grid business in part because it create as significant synergy between automation and power systems business. also they like the business. they think they can return to it profitability. i asked the ceo of abb how exactly they were going to do that. take listen. >> this business is the profit leader in its industry and

naturally in our portfolio not the best perform sewing what we're doing now is trying the transformation that has increased margin target of 10% 240% raised by 200 basis points to go forward. changing the offering, changing the business model, move stronger towards consolidation, towards software and services and changing the business motel. we're take out large parts of activities by partnering the floor so we're changing the business dmoel. changing the offering alling to that will support the margin quality of this business. >> reporter: now the calls for abb to spin off that business were spearhead by stephen capital an activist investor that holds a stake in abb. came out with a statement this morning. abb's decision to keep the conglomerate structure is unfortunate one. the share price potential is 35

swiss francs. they add the long term that is now, that means they are running out of patience. now stephen capital has repeatedly said with the power grid business abb is too complex, too difficult to manage but now abb is clinging on to that business. back over to you. >> all right. thank you for bringing us that interview. taking a look at u.s. auto sales falling in september despite large consumer discounts across the major market leaders. research firm auto data shows total industry sales came in at 1.4 million vehicles down 0.15% for an annualized rate. gm the top seller in the united states did post a 0.6% decline

for the month but speaking to cnbc gm ceo said the market was quote still strong. >> we again had a very strong retail month. again it represents our focus on profitable growth. it's a trend. we're seeing very strong transaction prices. so when you look at the market the market is still strong. 17.8 is still a strong market. 17.8 is still a very strong number considering where they were near the financial crisis. so the come back continues but there are a few analysts that have been warning about big volume in the u.s. and a little bit of a whisper you heard on the sidelines at the auto show in paris. a lot of concern is at a time when drivers ever still demanding big trucks you see there and suvs and at a time

when gas prices are low whether or not consumers are demanding the degree of cars that carmakers is producing. >> what about the shift to these companies that haven't been in the headlines. are our memories fickle and do people care? >> in the sense do you think people will buy electrics. >> or just opt away from a vw. >> the hope is with this push into electrics green cars they will win back some of those customers. too early to tell because they are really saying the big push into electrics will be a few years from now. >> speaking of cars and all things fueled by oil as well, iran's september crude oil sales havelmost matched the 2011 pre-sankss high at 2.8 million barrels per day.

this surprising the market and speed of increasing production since sanctions were lifted in vann. the middle eastern oil producer can produce at limits that make sense. it's interesting or funny not really funny, because of course the saudis came out ahead often peck deal, and said look, we'll cut if iran cuts. they aren't friends the saudis and iranians traditionally, historically. so saudi came out looking good. we'll cut if everybody else. then iran came to the table, okay we'll cut. now iran they are saying look we'll play even further ball if everybody else is playing ball. they are encouraging the non-opec members to play ball. iran is looking good. meanwhile iran's president has voiced his commitment stieblizing the market. in a phone call to his

counterpart of venezuela he said it was essential for oil producing countries to make a decision to raise the price of oil. the opec deal reached in algiers last week the first since '08 included modest oil outpouts. >> and santos is trying to save a peace deal with a rebel group in colombia. santos announced the appointment of a team of senior government officials to launch talks with the opposition in hopes of upholding the out kochl four years of intense peace negotiations. the colombian peso has slid 2019 days since the referendum. let's bring in emerging market strategist at legal and general investment management. good morning. let's talk about colombia. this came as a surprise to investors. investors clearly do not like uncertainty. is there any hope that another deal comes through here, a reason for investors to get

confident on colombia. >> the colombia side of me tells me yes there's hope and this has been going on for decades. people have suffered so much that there's clearly very much hope out there. if you listen to the farc, the arguments they brought forward trying to find a solution, they've done four years of work and i think they will find a solution. >> if anything it serves a reminder not all emerging markets are created equally. what are the areas you like? >> at the moment we like the higher yielding credits in the em space, like, for example, ukraine or argentina, brazil, the quasi softening out there giving you a yield pick up. a pick up over the sovereigns. these are things we're looking at at the moment. in 2017 the interesting story is the local currency base as we move ahead. we've seen quite a lot of influence this year already into emerging markets and made up for

the loss flofs in 2013, '14 and '15 in total. been quite huge. >> these are your favorites. brazil, argentina or a basket of favorites? >> a basket of favorites. in the emerging market space this whole oil play will have to play as we move ahead. it's split. >> how does mexico fit into this especially when you mention currencies. this peso play on the u.s. election, for example. not just looking at the numbers. just recently growing 2.5%. >> right. >> there are clear i die idiosyncracies. mexico focused on the trump-clinton debates. the colombian referendum, 50.2% brexit, 51 or 52%. so it's very close all of these

things. these are the things that are very much foin cuss in emerging markets. >> just on the mention of oil, what would you say is the main oil play if you want to, you know, somehow play oil and emerging markets at the same time. >> at the moment colombia really net commodity exporter. then you got the less net commodity exporter like brazil. on the other turkey and south africa net commodity importers on the energy side. so really those plays. if you like commodities, russia is an interesting story but there's obviously the tension between russia and the u.s. at the moment which is hitting that. >> should brazilian investors be encouraged by the elections we saw? local elections. >> we should see them encouraged. the vibes you're getting out of the country are very positive. >> simon thank you for joining us. let's give you another check on european markets before we go. we're seeing green arrows pulled across the board here and

strength particularly in ftse 100 higher by 1.3% taking its cue from sterling. u.s. futures and how we're stacking up for trade. we're pointing a little bit higher on the implied open on the right-hand side of your screen. as we've been saying it's a big weekend in term of the data, nonfarm payroll data on friday. expectations for 170,000 for the move september. >> hit the number. that's it for today's show. i'm louisa bojesen. >> "worldwide exchange" is coming up next. have a good one. guess what guys, i switched to sprint. sprint? i'm hearing good things about the network. all the networks are great now. we're talking within a 1% difference in reliability of each other. and, sprint saves you 50% on most current national carrier rates. save money on your phone bill, invest it in your small business. wouldn't you love more customers? i would definitely love some new customers.

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good morning. global market alert the pound plunging to 31 year low amid brexit fears. latest comments from british prime minister teresa may straight ahead. a developing story. will deutsche bank strike a favorable deal with the doj. live report from frunk further coming up. race to the white house. vice presidential candidate tim kaine and mike pence prepare to square off tonight. it's tuesday, october the 4th, 2016. "worldwide exchange" begins right now.