i'm zain verjee at cnn in london. a u.s. man maintains his innocence right up until he's executed for a police officer's murder. the u.s. supreme court denied troy davis's last last-pitch appeal. hundreds urged the court to stop the execution saying he did not commit the 1989 murder. after more than two years in an iranian prison, two americans are free. shane bauer and josh fattal greeted their families on wednesday. iran convicted them of spying, but they say they were hiking along the iran/iraq border. we may hear more about the two americans today at the united nations. mahmoud ahmadinejad makes his address to the general assembly around noon. an anti-ahmadinejad protest is planned for outside the building.

the u.s. central bank is hoping to kick start america's sluggish economy by selling $40 billion of short-term treasuries in exchange for the same amount of longer-term bonds. the idea is to push long-term interest rates lower even though they're already at record low ts. those are the headlines from cnn, the world's news leader. "world business today" starts now. hello, and a warm welcome to "world business today," i'm manisha tank in hon con. >> i'm nina desantos. the stock markets take a tumble. >> troubled tech giant hewlett packard could be about to give is boss a boot after barely a year in the job. >> i feel terrible.

can't sleep at night because you're thinking how are you going to pay for the family's bills. >> not being able to pay your bills for five months. in sfan the public sector workers are taking matters into their own hands for now. >> let's kickoff with the markets. the only thing you can be certain of is uncertainty itself. yet again more wild swings on stock markets around the world. investors are not convinced by the fed's latest attempt to shore up the economy. urine is up and running. nina, what have you got right now? >> what we're seeing is the ftse 100 down by 3.5%, really heavy losses down in paris as well. cac 40 down 4%. the situation for the dak, the operation twist at the federal reserve doesn't seem to have convinced the investors that the

ills are by any means gone. it doesn't seem to have done much for the markets today manisha. >> same here nina. i have a market screen in front of me right here on the desk. it is a wash of red. let's check in with ramy inocencio to give us the details on what's happening? >> plain and simple. a sea of red today after the u.s. fed scared investors when it warned of, quote, significant downside risks for the u.s. economy. at the same time the fed's operation twist is being a heart hearted attempt to calm the markets, maybe 2.5 if you will. the nikkei fell, the hang seng just closed a few minutes ago. it's down almost 5%. none of its component shares ended in positive territory today. this was the hang seng's biggest

monthly drop in almost three years. just like in japan, financials were the big drag. the world's biggest bank by market cap fell 6.5%. the shanghai composite was down 2.75. here hsbc's china flash purchasing manager's index came out at 49.4. this is the third month in a row it's come in under 50. that implies a slowdown in china manufacturing. this could mean beijing's policy to slow down red hot growth are taking hold. the asx fell down about 2.6 today, below the 4,000 mark. global resource stocks taking a big hit. rio tinto fell nearly 5%. the aussie dollar today, that weakened against the u.s. dollar and it today hit parity one to one here. it has been stronger for the

greenback for the past several months. the pmi from china and the outlook took it down. one point of light was fosters group. i'll tell you why in the next hour. >> i'm sure there's interplay going on between the equities markets and equities market. thank you very much for that. >> let's take a look at how things faired in the united states. stocks there on wednesday fell after the federal reserve announced the new measures to try to bring down the country's long-term interest rates. here is how the session actually ended. what be had was a number of markets in the red. the ones behind me are the asia pacific stock markets. what we did have is heavy losses for the football shares. some of the big day's losers as moody's downgraded a raft of u.s. banks, some of the biggest across the country, names like bank of america, citigroup, wells fargo. bank of america stock, if we

start with that one, those shares falling by 7.5% on the day. citigroup on the other hand losing 5% and wells fargo ending the day about 4% lower. it looks as though u.s. markets are likely to extend wednesday's slide. this is where the u.s. futures stand. if we take a look at that, also in the red, the picture in europe the losses not quite as pronounced. we had the likes of the s&p 500 down by about .7%. i was showing you about 2% when they ended. seems we're bound to extend that. a number of hours to go before trading gets under way. we could see the losses being even more pronounced for united states when we get the opening bell on wall street given the stock market action in europe, manisha. >> bearing this in mind, we need to tell you more about the

federal reserve's plan dubbed operation twist. it's not a new concept. the u.s. central bank implemented a similar policy back in the 1960s. it had pretty much the same aim, that is to keep interest rates low for an extended period. the point of that -- the idea is to reduce borrowing costs even further, and that will help the u.s. avoid another recession, this at a time when interest rates are already so low, nina. >> historic lows for the last two years. long-term interest rates are already at a record low in the united states, as manisha was just telling you. the question is, given that situation, why would the fed want to bring them even lower. part of the reason is due to the housing market. ben bernanke apparently believes that lowering rates will probably make mortgages more affordable for ordinary americans. we're already seeing that effect a little bit. sales of existing homes rose by 7.7% last month, more than

analysts and economists had expected. banks are still reluctant to lend. critics are wondering if pushing rates even lower will do nug to help the current situation. looser credit is what the economy needs. businesses are sitting on huge piles of cash and not really doing anything with it during these tough times. theer et clif lowering long-term rates could even further convince them to try and part with some of their cash, put their hends above the parapet so to speak. people are hoping businesses might be persuaded to invest some of their money in the economy instead. most crucially they could decide to spend on hiring, bringing down the unemployment rate across the world's largest economy, down from where it is at 9.1%. the problem is that the scheme is also going to raise rates in the short term.

in any case, more intervention might not necessarily be the answer. that's what the republicans seem to think. top gop members of congress have been telling mr. ben bernanke that more stimulus is actually a bad idea in the long term john boehner and eric candor have been saying that quantitative easing just haven't worked over the last couple of years. they say that those moves will only lead to more uncertainty, more volatility and they have respectfully asked the fed to think twice. well, have a look at this behind me. this is the basis of the game twister. one move could see it all go wrong. so here is how it works. we start up here. the fed would have to do this in

order to reduce the longer tsh term rates. they'll do that to shift this problem with the interest rate. they want to shift the yield curve. what it will do is sell short-term debt and put the money into long-term debt. the idea of that is it should push down the long-term interest rates. that means big investments like mortgages might become more attractive. how much money will the fed puts in? that's the question, $400 billion. maturities between six and 30 years for treasuries. a lot of people are asking is this really going to work? if you look at the markets, it doesn't look like they think it will. there's no guarantee that reducing rates will convince americans to buy or convince businesses to invest in the economy as it stands. a complicated game of twister. let's see if it will work out. up next, a company known for innovation, but now some investors say hewlett packard needs to reinvent itself. we'll look at reports the caused

the company's stock to surge 8%. that's just ahead on "world business today." prescription strength reliefzt from my worst allergy symptoms. so lily and i are back on the road again. with zyrtec®, i can love the air®. at aviva, we wonder why other arlife insurance companies. treat you like a policy, not a person. instead of getting to know you they simply assign you a number. aviva is here to change all that. we're bringing humanity back to insurance and putting people before policies. aviva life insurance and annuities. we are building insurance around you. [ male announcer ] sitting. waiting. hoping. that's a recipe for failed investing. open an e-trade account and open doors, seize opportunities, take action with some of the most powerful

yet easy-to-use trading tools on the planet all built to help you maximize the potential of every dollar you invest. successful investing isn't done by throwing ideas against the wall and hoping. it's done by lowering your costs and raising your expectations by using unbiased research and powerful screeners to build a diversified portfolio with stocks, bonds, mutual funds, and every etf sold. and we'll help you every step of the way. with 5-star research and free education covering everything from the basics to advanced investing strategies. start now and we'll give you up to $500 and let you trade free for 60 days. visit our website, call us, open an account. e-trade. investing unleashed.

welcome back to "world business today." good to have you with us. >> change seems to be afoot at technology giant hewlett packard. leo apotheker has been at the helm since november of last year, but his number might be up. the past ten months have seen a bumpy ride and talk is that the he may be replaced possibly by former ebay chief executive meg whitman. a spokesman refused to comment on the possible exit. but the stock movement spoke volumes, jumping no less than 8% when work leaked out. the company has lowered sales

forecast three times and investors railed against stop of apotheker's strategic moves. he canceled the web os tablet operating system months after announcing it was the next big thing. nina was mentioning the jump on the stock price on news he might be about to go. another reason why hp investors have been unhappy with leo apotheker's leadership, it is the performance of the stock price. have a look at how this chart looks. says it all, doesn't it? hewlett packard stock has been hammered since last november when he actually took over. have a look at this figure, down 43%. that really says it all, nina. the woman that's been tipped to replace apotheker is fairly well known to many people who follow the technology sector. meg whitman is a 55-year-old veteran of silicone valley, a

member of the hewlett packard board since the beginning of this year, best known as the former ceo of ebay which she ran for no less than ten years, she was also a republican candidate for the governor ship of california back in 2010. before her entry into politics she held jobs at disney, the toy maker hasbro, fortune magazine's most powerful woman in business. seems like leo apotheker may have to watch his back. there have been other women in charge of hewlett packard, famously carly feiorina spectacularly fired by the board. it must be difficult being a technology chief executive these days, nina. >> i don't know if it's just a

technology chief executive. i wonder if it's difficult being an hp senior executive. an interesting article in "the new york times" suggested one of the problems that apotheker ran up against was the internal culture at hp. while he started out saying i want to focus strategy on the higher value, high-end hardware products, when it came to rolling it out and communicating it to the rest of the company, he came up against resistance. the thing with these sorts of firings, you never really know what goes on behind the scenes. at the ends of the day, being a ceo is about leadership. your stock price is going to suffer. it's hardly a wonder if this is true that he's come up against problems with the board. it will be interesting to see if it gets better. >> we'll have to see. we still have so much to come up on the show including this. >> translator: almost everyone

here lives month to month. when you miss a paycheck, it's over. >> in spain one town is so cash strapped it can't pay the police. they say they've had enough and they're walking off the job. that story just ahead. it's real milk full of calcium and vitamin d. and tastes simply delicious. for those of us with lactose intolerance... lactaid® milk. the original 100% lactose-free milk. when i got my medicare card, i realized i needed an aarp... medicare supplement insurance card, too. medicare is one of the great things about turning 65, but it doesn't cover everything. in fact, it only pays up to 80% of your part b expenses. if you're already on or eligible for medicare, call now to find out how an aarp... medicare supplement insurance plan, insured by unitedhealthcare insurance company, helps cover some of the medical expenses... not paid by medicare part b.

that can save you from paying up to thousands of dollars... out of your own pocket. these are the only medicare supplement insurance plans... exclusively endorsed by aarp. when you call now, you'll get this free information kit... with all you need to enroll. put their trust in aarp medicare supplement insurance. plus you'll get this free guide to understanding medicare. the prices are competitive. i can keep my own doctor. and i don't need a referral to see a specialist. call now to get a free information kit. plus you'll get this free guide to understanding medicare. and the advantages don't end there. choose from a range of medicare supplement plans... that are all competitively priced. we have a plan for almost everyone, so you can find one that fits your needs and budget. with all medicare supplement plans, there are virtually no claim forms to fill out. plus you can keep your own doctor and hospital that accepts medicare. and best of all, these plans are... the only medicare supplement plans endorsed by aarp. when they told me these plans were endorsed by aarp...

i had only one thing to say... sign me up. call the number on your screen now... and find out about an aarp medicare supplement insurance plan. you'll get this free information kit... and guide to understanding medicare, to help you choose the plan that's right for you. as with all medicare supplement plans, you can keep your own doctor and hospital that accepts medicare, get help paying for what medicare doesn't... and save up to thousands of dollars. call this toll-free number now. it's one of those very

famous ferries making its way across victoria harbor, a murky day in hong kong. i'm all too familiar with that. welcome back to "world business today" here on cnn. >> pretty murky here as well, manisha. >> putting the human face on the eurozone crisis. state educators in madrid are staying off the job in large numbers over staff cuts. schools of workers in one town haven't been paid since the spring, some ending up at local soup kitchens to feed their children. cnn bureau chief al goodman says they're fed up and they're taking action. >> reporter: at first glance the village seems idyllic, lots of sun, life at a leisurery pace. but 130 municipal workers here are seething. they haven't been paid in five months. now they're in open revolt and the town's police force is leading the battle.

>> translator: i feel variable. you can't sleep at night because you're thinking how are you going to pay for the family's bills. >> reporter: this man has been a local cop for 26 years but now sports a different uniform. the shirt says "we want to get paid." the police officers here say they're owed on average about $14,000 each in back pay. for their families, that's real money. they can't go on strike by law, all 16 officers have called in sick. they have doctor's notes. there seems to be an epidemic of psychological problems among the police force. other local workers sympathize. >> translator: almost every one here lives month to month. when you miss a paycheck, it's over. everyone supports the police and other city workers. >> reporter: this woman and her husband are suffering, too. he's a city maintenance worker. >> translator: it's very, very

bad, horrible. there are five of us, three kids. i cannot give them anything to hea eat. >> reporter: they eat at local soup kitchens. who is to blame? the local council ran up a $75 million debt in a town of just 13,000 people, that's more than $5,000 per person. when the conservatives won elections here in may defeating the socialists, they started to make cuts. even so, credit is tight says this town councilman. >> translator: clearly the financial situation in spain is a bit more complicated. it makes a solution here more difficult, but there are solutions. >> reporter: one of them is to beat the ruling socialists in national elections in november. many of spain's regions and municipals are struggling with high debt and that may derail the national government's efforts to refuse the country's deficit.

in valverde, the town councilman doesn't think city hall will have to close, but he can't say when the next paycheck is coming. al goodman, valverde dell camino, spain. let's move to very different matters. typhoon rokei was battering japan. it's been improving, but areas down towards the south as well as the west of tokyo, they picked up heavier rainfall as well as stronger winds. but the totals were quite impressive, talking 600 millimeters of rainfall, these two feet of rain for some parts of japan, areas down towards the south as well as the central area including sendai, 319

millimeters of rainfall. what does it look like now across japan? you can see for yourself, the typhoon is pulling away towards the russian maritime. it looks as we go through the next couple days things will be nice and dry. let's go to video and show you exactly what it looks like or what i looked like when the typhoon was getting close to tokyo. you can see the winds whipping around. we know many areas are still dealing with flooding as well as power outages. the problem is with the area still being so saturated, we'll deal with the risks for landslides. another big story out of china, flooding there as well. this time in the central region. we're talking about the shunning ching province as well as the szeshwan province. let's go to images out of that region. we'll show you exactly what it looks like. if we go to some of that individual -- oh there it is right there. it's showing the flooding

situation happening across that area. the problem is the rain has been unusually heavy. typically this is an arid region. now we do know that reportedly 70,000 people have been forced to evacuate that region. more video, this one showing you an overpass that collapsed after days of heavy rainfall. luckily no one was actually killed during that collapse. it's going to take a while to get things back together. as i take you back here in the satellite imagery, things are quieter for the szeshwan province and over towards the east it looks like we'll get a break from the heavier rain faum. lit be a bit cool for this time of year, but luckily things are going to start to dry out. we'll send it back over to you. >> all right, jennifer. i did notice a cameo on the october fest there. relieved to see things -- >> i can't tell you you caught it all. the weather will be beautiful the next couple days. can you have bad weather and

drink? no. it always gets better. >> you begin to see whatever you want to see. >> as long as you do it smart. >> be smart, please, if you're going there. jennifer delgado. executives as one of the world's top brewing companies will be toasting their success. a london-based brewer has made a break through in its attempts to go down under. we'll have details with ramy all ahead on "world business today." . three smart new ways to sweeten. same great taste. new splenda® essentials™.

at aviva, we wonder why other life insurance companies treat you like a policy, not a person. instead of getting to know you they simply assign you a number. aviva is here to change all that. we're bringing humanity back to insurance and putting people before policies. aviva life insurance and annuities. we are building insurance around you. [ female announcer ] improve the health of your skin with aveeno daily moisturizing lotion. the natural oatmeal formula improves skin's health in one day, with significant improvement in 2 weeks. i found a moisturizer for life. [ female announcer ] only from aveeno. can a trading site i found a moisturizer for life. help make you a sharper trader?

mine can. td ameritrade can. they've got trading specialists i can call for help. and paper trading. free practice trading that helps me hone my technique. complex options. and free tutorials. online or in person. can a trading site really make a difference? if it can't, why are you trading there? number one in online equity trades: td ameritrade. trade commission-free for 30 days, plus get up to $500 when you open an account.

from cnn hong kong.

i'm manisha tank. >> i'm nina dos santos. welcome back to "world business today." today in europe, a big sell-off is under way. here is what the leading indices stand at the moment, a number are actually down in excess of 4% when trading started an hour and a half ago. as you can see, dax still down 3.5%, cac 40 down 3.8%. whatever ben bernanke has said overnight, it hasn't impressed the markets. >> it hasn't impressed investors in asia here. at the close steep losses across therd boo, particularly in hong kong. you can see the numbers there. the hang seng probably the worst performer, down more than 4.5%, almost 5% by the close, shanghai also taking a beating. this is one you normally see a lot of resilience for because of

thigh hopes for the chinese economy and it perhaps resilience in the global situation. i think all those red arrows really telling you the story. >> let's take a look at what happened on wall street on wednesday. alison kosik is at the new york stock exchange with a full wrap of the day's action. >> stocks tumbled wednesday following the federal reserve's policy announcement and weak economic outlook. at the close the dow dropped 283 points ending at 11,124. the nasdaq fell 2%, the s&p 500 lost almost 3%. the reaction to operation twist in the bond market was immediate as long-term rates fell sharply. the yield on the benchmark ten-year u.s. treasury bond fell to a record low below 1.9%. financial shares were under pressure following debt downgrades by moody's ratings agency of bank of america, citigroup and wells fargo. mudi's says there's a lower probability that the u.s. government will step in to support banks in trouble.

shares of citi and welts fargo fell 4% to 5%. bof a fell to just $6.38 a share. shares of hewlett packard jumped almost 7%. investors heard rumors that the company was looking to replace ceo apotheker and replace him with meg whitman. apotheker has been there for less than a year. hp shares have fallen more than 40% since he took the help. things are looking better for tuchlt s. housing market. sales of previously owned homes jumped more than 7.5% in august. that was better than estimates. the data was not seen by investors as a sign of real recovery and was largely overlooked by the market during a busy wednesday session. that's a wrap of the day on wall street. i'm alison kosik in new york. >> u.s. stock markets are on

track to lose more ground when trading begins later on thursday. having a look at the futures, you can see them down. perhaps many of you were expecting them to be more sharply down. for now we're down in cautious losses there, more than 1% apiece. it is a slightly more cheerful picture and executives may be raising a glass to the latest success. the anglo african company has finally managed to woo rival foster's group from australia into a billion dollar deal. ramy inocencio is back to give us the details on this one. >> it's a deal and finally we've been tracking this for the past three months. this is something for people around the board. this offer values foster's at $10.2 billion, up from a previous valuation. with the board's backing it's

expected it will be approved. the clincher is miller increased it to $5.10 per share. on top foster's shareholders will get 30 cents a share from a capital return previously announced as well as a final dif vend of 13.5%. investors appeared to toast that. foster's stock popped 7.5% higher today. but sab miller is trading in london, down about 4.5%. manisha? >> sab may have spent a lot of money on the foster's deal. some individuals are so wealthy they could buy that company a few times over. it's that time of year again. yes, forbes has released its annual rich list of the 400 wealthiest americans.

once again, a familiar face in the top spot. it's this man, microsoft founder bill gates, america's wealthiest person for the 18th year running. according to forbes, gates' fortune has jumped by $5 billion in the past year alone and now he's worth this figure, no less than $59 billion. he's amassed quite a comfortable lead over his rivals. if we take ooh look at the top six, the hedge fund investor george soros is worth $22 billion. that's where it starts for the top six. then next we have christie walton. this is the lady who is the heir to the walmart fortune. it now stands at no less than $24.5 billion. tied in fourth place are charles koch and david koch, the owners -- co-owners of american conglomerate koch industries. they have about $25 billion each. in the third spot we have man,

larry ellison, founder of business software giant oracle, worth some $33 billion. in the penultimate place we have warren buffett worth an estimated $39 billion. even he is eclipsed by this man's fortune, bill gates, reportedly worth $20 billion more than buffett. his fortune stands at just shy of $60 billion. we should also point out, manisha, those last two characters on the list, buffett and gates, in spite of being some of the world's most rich people, have said they're going to be giving almost all of that to charity. >> they were recently on a tour, they went to india recently and said particularly in a country where more and more billionaires are emerging, they were saying people need to give more that philanthropic causes. whatever they're doing, we should be taking notes. mr. gates has been making more money amid all the volatility,

he's definitely doing something right. anyway, we'll have to figure that out. sizing up asia's forth biggest stock market. >> i'm looking at a macro -- over the next ten years. what are the factors happening in the country. >> the head of the bombay stock exchange says why he's not too fussed about the volatility and what he expects for india yeah in the future. who need

imagine... one scooter or power chair that could improve your mobility and your life. one medicare benefit that, with private insurance, may entitle you to pay little to nothing to own it. one company that can make it all happen ... your power chair will be paid in full. the scooter store. hi i'm doug harrison. we're experts at getting you the power chair or scooter you need.

i didn't pay a penny out of pocket for my power chair. with help from the scooter store, medicare and my insurance covered it all. call the scooter store for free information today. welcome back to "world business today." >> india's benchmark stock exchange has been following the downward trend as investors express skepticism over the latest plan to buy u.s. debt. here is how the sensex is moving now, extending the losses since

the opening in usual, down more than 3%. it's dropped more than a percent. a little under a percent in the last half hour or so. let's give you late mover background on the bombay stock exchange. it's not not an index we cover very often in the show. it's the oldest stock market in asia with a current market capitalization of more than trillion. it's the eighth largest in the world. the bse in fact has more than 5,000 listed companies on its index. that's more than any other exchange anywhere else on the planet. it has a collective pool of about 20 million investors, and annual revenues are estimated at $112 million. >> like other markets, it's been ot if mercy of general debt fears. it lost 17% of its value since

the beginning of this year. >> it's one of the worst performing stock exchanges so far this year. here is how it stacks up. the hang seng in hong kong is the only other asian market to perform worse than the bse. that one is down more than 18%. in europe, london's ftse 100 has lost more than 10%, and the s&p 500 is roughly down about 7% for the year. >> of course it doesn't help today has been another volatile day on the markets with the sensex. earlier i spoke with madhu kannan. he was unsurprisingly upbeat about the markets back home. >> india is different in that we have a strong domestic demand. i'm using the word very broadly. also if you look at the offering

in the market now, a lot of domestic -- there are much more products that will not be available on the exchange platform. i think it's a different framework than what you would see in a developed market at this stage. >> let's look at the global comparison. i've got numbers here. let's talk about how things are going year to date. you must have seen this coming. you're down 16.8% on the sensex compared to the footed z down 10%, s&p 500 down 7.2%. the only one you're doing better than of the major indices in this area is the hang seng which is down 18.3. what do you think of that? >> i don't want to get too much into the levels of markets. i think since 2009, if you look at the previous elections taking place and the reforms taking

place, i think we've done very well. i think it's not proper to compare it over a short period of time. if you look at growth in a longer term perspective. a lot of fundamental changes put in place, be it infrastructure, physical as well as financial infrastructure and the huge impact right now on development of human capital. these are things that will pay dividends over a longer period of time. i for one as an infrastructure provider would not want to lock myself into a three month or six month or year comparison. i'm looking at a mack xroe -- let's look at the next ten years and what are the factors happening in the country that's going to make india very attractive from a macro perspective. >> let's talk about another aspect and that's the ipo market, always an interesting gauge of what's going on in the wider company. last year you had a great year, running growth in india of 8% now. we're living in a different world a year later. now what are you seeing?

what can we expect over the next year as far as the ipo market. >> last year was a pretty goodyear as you said. i think the robustness of the primary market is sometimes affected by the volatility of the secondary market. the interest rates in india are strengthened. today you can get -- you can actually invest in the market. and then you add to the fact that maybe some of the interest investors are particularly looking to india, they have other problems. there's a move away from the market. i would say the ipo market is not going to be as well as last year. that's what the numbers seem to indicate. but the equity, the commitment toward the equity culture, a very important part that i want

to reemphasize. the commitment towards dwoching of exchange traded financial assets is definitely there to stay. >> it was kind of interesting when ma hugh kannan was talking about culture, he had a conversation about what he wants to see in the future, he talked about moving from an investing culture in india to a trading culture. here is a built of a back story of that interview. there was a moment where -- quite a lot of background noise going on. he stopped and said anybody thinking it was trading at the bombay stock exchange. he said i don't think anything would pip that, a 3% drop for the day. >> i remember covering the bombay stock exchange during the boom times. what was interesting about markets like this, in previous

years what we've seen is when there has been a market row, people flee the emerging markets and any sign of concerns and that picture is changing to a certain extent as india and china become just such important players on the world scene and also important stock exchange on the world scene as well. anyhow, they've been dressing the stars and politicians for years. now cuban designers are hoping to cash in on those linen shirts made famous by latin american leaders like cuba's fidel castro and venezuela's hugo chavez? will they catch on? that's one of the questions we'll be tackling here on the show after the break.

slightly hazy day over victoria harbor, our live shot in hong kong. welcome back. this is world business today. >> european stock markets are continuing the losses we saw earlier today. the indices were down in excess of 4%. this is where we stand, around 3.5% to 3.8% down. it's currently the cac 40 in paris faring the worse. it seems the federal reserve's operation twist to bring down long-term interest rates has been met with a hefty degree of

skepticism by investors who are concerned that we could see a raising of short-term interest rates. that's one of the reasons the markets are concerned and those stock markets are down. of course, manisha, anything could happen between now and when the united states markets get trading later today. that will certainly give us another indication of where we may end the week. >> that's true, nina. there's so much volatility out there. this happened to us yesterday, didn't it? we saw asian markets where we didn't have much of a loss. and then europe really picked up and played out those loss as bit further. then we saw this big slide on wall street. so it can always go either way. the volatility index for the s&p 500 is at the upper end of the 52-week average. that suggests that volatility is at a very high level. in the markets in asia, the numbers will tell you all you need to know. down almost 5% for the hang seng, the worst performer in this region. you can see the other major indices here ngs shanghai down.

when you think of fidel castro, high fashion doesn't generally come to mind. one of cuba's top designers is on a mission to make those box xi linen shirts cool. shasta darlington has the story for us from havana. >> reporter: they're designed by hand, stitched together with a couple of ancient singer sewing machines. nelson gera turns out crisp linen guayabera shirts. >> i make them more tailored to show off your physique he says. it's official attire at cuba's formal functions and gera is one of the island's best-known

designers, dressing stars and visiting luminaries like sting and danny glover. he's even made guayaberas for fidel castro and hugo chavez. on the day we visit, the power goes out and workers rush to finish an order by hand. ap guayabera represents the ultimateness in cubanness, he says. another gera creation with the cuban flag on the back turned heads when delgado wore it on stage. it also caught the attention of a big name fashion designer. but if all goes well, the shirts for men and women could be on sale in european department stores. in the meantime, gera has taken on a big challenge at home, where guayaberas are associated

with government and bureaucrats. i want to attract young people to guayaberas, he says, i'm giving them more shape, more curves. at $20 to $100, the hand crafted shirts are out of reach for many in cuba where the average salary is $20 a month. guerra is doing his part to keeping the tradition alive, even dedicating a song to a guayabera. if you put one on, you can go anywhere. shasta darlington, cnn, havana. >> a catchy tune. cuba's guayabera reminded us of traditional garments we've seen from other countries, modeled each year at the asia pacific summit. leaders traditionally pose wearing the host country's national costumes. one of the most memorable was back in 2006 when vietnam gave

the leaders brightly colored silks. in 2007 it was australian made work coats when the summit was held in sydney. in 2008 the leaders wore ponchos made from the fleece of baby alpacas in chile. >> i think one day i should anchor the show -- you can get in touch with our facebook page. do get in touch. if you have something interesting to say, we might feature it on the show. that's it for this edition of world business today. i'm manisha tank in hong kong. >> i'm nina dos santos in london. see you soon.