attacks on the south korean coast guard in flame tensions with china. the murder of a south korean coast guard officer has touched off a flurry of diplomacy on and around the yellow sea. the captain of the chinese fishing boat stabbed the officer, killing him. he wounded another. now south korea's coast guard hints it may relax rules on firearms. the captain and crew were fishing illegally in south korea's economic zone in the yellow sea. the officers boarded the boat to inspect it, then the captain attacked. the coast guard detained him and

eight other fishermen. officers took them near seoul for questioning. maritime authorities launched an investigation. they only permit firearms for self defense, but authorities are now reviewing that rule. >> translator: we have restricted the use of firearms in the past, but after this incident, we will consider allowing their use even if the initial stages of an inspection. >> officially china has stuck by an agreement with south korea over fishing rights, but on the water it's a different matter. this part of the yellow sea is a rich fishing ground. chinese fishermen have been entering these waters illegally to catch saury that are abundant this season. the boats are resorting to bolder tactics to avoid being caught. this vessel has steel rods

attached to its sides to deter patrol boats from approaching. fishermen use steel pipes to attack any coast guard officers that try to board the vessels. some fishing boats fly the south korean flag to try to deceive the authorities. south korea says china's fishing resources are in decline but the demand for seafood is surging so the fishermen are becoming more audacious. south korean fishermen say they're feeling increasingly threatened by the chinese boats which operate in groups. >> translator: the chinese use trawl nets which are abandoned in south korea, and take everything they can. >> south korea uses a satellite to confirm a boat's national registry and imposes fines on vessels without a permit. the nikkei rose monday but europe and wall street dropped shortly. ai, what was behind the fall? >> the calm following the european summit seems to be fading fast.

in fact, they said the summit did little to ease the crisis. the dow fell over 200 points at one stage. another negative factor contributing to the selloff was intel cutting revenue forecast. the dow ended at 12,021 points, down 1.3%. over 160 points from friday. let's check how stocks are kicking off in japan after the selloff on wall street. we cross-over to ramin mellegard at the tokyo stock exchange. ramin, good morning to you. what can you tell us. >> very good morning to you, ai. let's look at the opening levels this tuesday morning, and you can see quite clearly following a downturn in u.s. and european

markets. the nikkei down over 100 points as well this tuesday morning, despite the ending positive note yesterday, trading range was in a tight range yesterday and on lower than average volume. we'll see how today goes. judging by reaction on the dow and european markets, looks like global markets aren't convinced a complete resolution is in place for the eurozone issues. we saw a selloff in gold and wti crude oil prices, so we'll keep track of banking sector stocks and key commodity related stocks, and as you mention there, ai, also intel falling about 4%, citing a shortage of supplies following flooding in thailand, and we'll keep track of the tech sector as well. let's switch to the currency markets. euro telling us a lot about what the market feels about eurozone progress. saw the euro fall against the

dollar. euro/yen in the 102 levels. yesterday in the 103 levels. some japanese companies suffering from the yen. they have assumed an exchange rate higher than now. $80 to the yen or 105 against the euro. that's causing a little problems there. ai? >> ramin, we have one day to go before olympus has to clarify the past earnings. the deadline for that is tomorrow. they may be de-listed if they don't do that. how has it been trading? >> crucial focus for a lot of investors' eyes. since october we have been keeping track of it since the scandal broke out. michael woodford who came back to japan to answer questions from investigators, he is in town today. the stock is down 80% at one point, but since the lows of november 11, up around 140%.

markets are betting that olympus will survive the scandal, but we'll see how it plays out today and before the deadline tomorrow. the nikkei and topix are both down this tuesday morning. back to you. >> thanks, ramin. that was ramin mellegard from the tokyo stock exchange. concerns are mounting that britain may end up isolated in the european union after the country rejected a new agreement for containing the region's credit crisis. some in the ruling coalition are critical of the prime minister's stance. >> i went to brussels with one objective, to protect britain's national interest, and that's what i did. >> at friday's summit all nations except britain agreed to revise the eu treaty to boost fiscal discipline. britain opposed saying it would leave financial activity more vulnerable to eu regulation. nicolas sarkozy criticized the

british stance and told them there were two europes. one wants regulation and the other is only interested in the benefit of a single european market. time for a recap of the latest market figures. that's the latest from business. back to katherine. >> thanks very much, ai. areflect a blames setbacks

following the accident at japan's fukushima daiichi nuclear power plant. areva is one of the world's leading nuclear energy conglomerates. its business activities include the development of nuclear reactors and reprocessing of spent fuel. the french firm announced on monday a projected full-year operating loss of up to $1.6 billion euros. the firm says its nuclear energy business has been hurt by anti-nuclear movements around the world triggered by the fukushima accident. it also says the construction of its latest power station, the european pressurized reactor, has been delayed in finland. the firm asked the paris bourse to suspend its stock listing as it was worried about a plunge in the price. french media reported that areva will cut its workforce, but the company has made no official announcement.

japan's government says its fiscal 2012 budget will prioritize reconstruction of the disaster-hit areas. it will also strive to cut the national debt. the government's council on national strategy adopted principles for the next budget. it will mark the beginning of japan's revitalization and calls for a rethink of japan's energy policy. it says general expenditure and government bond issuance should not exceed the initial budget for this year. the council agreed that the government should limit new bonds to 44 trillion yen or about $567 billion. it says the european debt crisis emphasized the need to secure market trust for the fiscal structure. the government is expected to endorse the principles at a cabinet meeting this week. japan has a new agency to oversee reconstruction. the lower house approved a bill to create the agency. the government says 200 people will coordinate the rebuilding work of other ministries an

agencies. the headquarters in tokyo will employ 140 people. they will work at each of the branch offices. the government plans to open the agency in february and hopes to eventually employ 400 people. "newsline" is the place to turn to for the latest on japan post march 11th. we have two segments offering two unique perspectives on the fallout from the earthquake and tsunami. "nuclear watch" brings you insight and information on the impact of the fukushima daiichi crisis. and "the road ahead" examines japan's efforts to recover and rebuild. don't miss "nuclear watch" and "the road ahead" on "newsline." investigators are trying to figure out how olympus was able to cover up more than a billion dollars investment losses for more than a decade. we spoke to a former company

executive to get his take on the story. >> he served as a board member at olympus between 1995 and 2006. he says he knew nothing about the coverup. >> translator: i am ashamed to say most directors, including myself, were unable to see through the coverup. an independent panel set to investigate it found out some officials were secretly concealing the losses. it strongly criticized senior management saying its core was rotten. he says he was unable to detect the wrongdoing because he, like other directors, was too preoccupied to keep an eye on the company's finances. all the directors tended to focus on their own area of

business. they had this idea that as long as they were doing a good job managing the divisions, they were fulfilling their duties and responsibilities. i admit that our sense of corporate governance was low. >> with the coverup revealed, the public has lost confidence. olympus may be de-listed from the tokyo stock exchange. >> translator: this is all such a shame. he worked for olympus more than 40 years. he says he regrets the company he loves finds itself in this quagmire. >> translator: we all believed the company would prosper as long as it produced fine products with its technology. it is too bad that the so called

money game led to the losses and the coverup. >> last month he launched a website and he hopes it will give olympus employees an opportunity to think about rebuilding the company. on the website, some of them said they want to regain public trust. they say this is a time to change the firm drastically. >> translator: the employees must take initiative for revival of the company. i want them to take action in their own way, rather than pretending they don't see the problems. >> accountants at olympus are busy putting first half earnings together, trying to meet a deadline wednesday to avoid being de-listed from tokyo stock exchange. japan is closer to launching a transport business in safe with successful rocket liftoffs

reaching 95%. an h 2 a rocket lifted off without a hitch monday. the attached satellite is orbiting several hundred kilometers above earth. it can detect objects as small as 1 meter on the ground and is able to function at night and through clouds. the government plans to send up another reconnaissance satellite. this would make it possible to obtain pictures of every location on earth at least once a day. h 2 a had 19 successful launches and one failure in its ten year history. a 95% success rate is considered acceptable standard for commercial space programs. >> translator: we thought it would be a distant goal. we're happy we were able to meet our objective. now we reached a world class

level. >> several hurdles need to be cleared before the japan space program is a viable business. cost is the primary obstacle. it cost 10 billion yen to launch the h 2 a. 20 to 30% more than other comparable rockets. and the smaller pay load is a major barrier. h 2 a is designed to carry satellites that weigh about four tons. the global norm shifted to five tons or more. japan's first mission will be a south korean satellite next year. a japanese policy making group agreed to maintain t existing ban of arms. advice ministers of the foreign defense and other ministries met for the third time monday to discuss easing restriction on arms exports. ministers decided to keep the restrictions as some ruling

democratic party members are reluctant to change them, but they maintain that japanese firms can develop or produce defense equipment with partners in other countries, as long as the projects do not prolong conflicts. they said class fight data must be protected once firms engage in projects. they agree companies can sell heavy machines for self defense forces to other countries for international peace keeping missions or humanitarian assistance. they have been using such equipment for peace keeping operations. the government hoped to further discuss modifying policy to meet new standards on arms exports by the end of the year. yoshihiko noda is the sixth prime minister in five years, so needless to say, dealing with voter discontent is part of the job description. still, he's only been in office for a few months. but according to a new nhk poll, his support rate is slipping. more people disapprove of his cabinets than approve of it. nhk carried out the poll over

the weekend. 37% of respondents said they support the cabinet. that's a drop of 8 points from the previous month. the disapproval rating rose by 12 points to 42%. among those who disapprove, 39% said they have no confidence in the government's policies. another 34% said it lacks the ability to implement them. nearly 50% said defense minister yasuo ichikawa and consumer affairs minister kenji yamaoka should resign following a panel of censure moments against them in the upper house. 44% said they approve of noda's plan to submit a bill on a proposed sales tax increase by march, but 48% said they do not approve.

the march 11th disaster, the arab spring, the european debt crisis. the character next to me or kanji could apply to all those stories. it stands for kizuna which means bond in japanese. the bond between people that can be strengthened, strained or even broken. the kanji association in kyoto selected kizuna on monday as its word of the year. it received some 490,000 entries for its poll. let's see how this word applies to some of the biggest stories of 2011. >> kizuna describes what happened in japan following the march 11 earthquake, tsunami and resulting nuclear accident. the strong bonds between people helped them recover from the disaster, which left more than 19,000 people dead or missing. the japanese were pulled away from their families, friends, homes and home towns. they supported one another emotionally and financially. people worked side by side to recover from the disaster. volunteers traveled to the

northeast to help out. online social networks played a role in keeping people connected and informed. japan also receive assistance from abroad. many countries are regions sent donations, supplies and medical teams and medical personnel for search and rescue operations. the ongoing crisis at the fukushima nuclear plant tested kizuna in japan. the bond between citizens and authorities frayed. people grew angry with tokyo electric power company because it ignored tsunami predictions. they also grew frustrated with the government for how it dealt with the fallout from the accident. a common bond or kizuna united people across north africa and the middle east. people turned to twitter and facebook to complain about their leaders, organized protests and get their message out to the rest of the world. the pro democracy arab spring movement began in tunisia and

people in egypt and libya followed the wave. regime change came to those countries and to a certain extent in yemen. but protesters in syria are still risking their lives to demand the resignation of bashir-assad. you can say that steve jobs developed kizuna with his inventions. people bonded over the ipod, the iphone, the ipad and much more. the co-founder and former ceo of apple died at the age of 56. his death prompted an outpour of emotion around the world as people gathered to mourn the loss of a man who many called a genius. another high profile death prompted the opposite reaction. we saw kizuna at play in the united states as some americans gathered together to celebrate the killing of al qaeda leader osama bin laden but the united states carried out the military operation in pakistan without

permission. that tested the bond between the two nations. bilateral relations have been strained since. kizuna has also come to the forefront in europe's debt crisis. some euro zone countries want to strengthen the ties and rules that bind them to save the single currency. the financial, political and social turmoil has battered the bonds between citizens and their governments, between politicians and between nations. back in japan, people are expected to bond over this architectural achievement, the tokyo sky tree. at 634 meters, it's the world's tallest self-standing broadcasting tower. it opens on may 22nd. >> and we hope we've established a form of kizuna with you this year here on "newsline." stay with us in 2012 as we bring you the top stories from japan, asia and around the world.

clear blue skies in tokyo this tuesday morning. let's get the bigger weather picture here and elsewhere from saki ochi. and let's do get a look at conditions across the globe. we start off in asia and in the southeast, in the south china sea particularly looking at this cluster of clouds here. we have been keeping an eye on if tropical depression in place and it is beginning to strength number the next 24 hours. we could possibly see it turn into a tropical storm system. we'll keep a close eye on its developments. for now it does remain largely off in open waters, but we do see a little bit more rain moving into central sections of vietnam mainly for the coastline, you may see a little bit stronger showers form today. for the philippines looking at more widely scattered showers. a possibility of a thunderstorm or two in areas. and then in taiwan looking at light showers.

the same also for the southern islands of japan but a largely dry picture for much of east asia across china and the korean peninsula things do look quite nice and dry. as we head into the evening hours, then on to wednesday, you can see a little bit more precipitation forms in the northeastern corner of china. that could be including some snow flurries. keep an eye on that. as for japan enjoying widely sunny skies for the most part today. a little bit of snow showers lingering in tohoku area, but that's on its way out. then in the evening and on into wednesday a little bit more rain starting moving up from the north or from the south, i should say, so the pacific coast may start to seattle bit more unsettled weather. tuesday's highs meanwhile looking at 12 in tokyo, 6 expected in seoul, getting up to 12 in shanghai, then 19 degrees expected in taipei. now over towards the americas, it's this southwest corner of the u.s. that we're really concerned about.

there is a slow moving low that's moving on and bringing in widespread precipitation to california and this corner of mexico. as that rain moves in towards upper elevations of the four corners area, it started to turn over into snow. and we could be talking about pretty ample amounts of snowfall over the next couple of day. this is a slow moving system. you can see that just really lingers in place. so snowfall accumulations could be 10 to 14 centimeters. you do want to watch out for that. the rain extends into the central plains from the same system. and you'll be looking at cold precipitation, so freezing rain, icy conditions are going to be a concern as we head into tuesday for you here. 3 expected in denver on tuesday, 5 meanwhile for chicago. getting up to 11 in d.c. and 16 expected in atlanta. finally a look at europe here. it is the british isles that we're particularly concerned about a well developed system once again impacting the area.

strong winds have already been felt in the region. and likely you will continue to see pretty gusty conditions throughout the rest of this week. you've got a series of storms heading this way. for the next 24 hours, heavy rain will be likely across much of the area while snow possible for scotland. and also areas like the scandinavian peninsula into continental europe, widespread unsettled conditions to watch out for. tuesday's high looking fairly mild overall. fairly seasonal i should say, 4 in warsaw, zero in moscow, up to 5 degrees in stockholm. here is your three-day outlook.

our lead story this hour, the murder of a south korean coast guard officer touched off a flurry of diplomacy on and around the yellow sea. the captain of a chinese fishing boat stabbed the officer killing him. he wounded another. south korea's coast guard hints it may relax rules on firearms. the captain and his crew were

fishing illegally in south korea's economic zone in the yellow sea. the officers boarded the boat to inspect it, then the captain attacked. the coast guard detained him and eight other fishermen. officers took them near seoul for questioning. maritime authorities launched investigation into the killing and illegal fishing. the coast guard currently only permits firearms to be used for self defense. but authorities are now reviewing that rule. >> translator: we have restricted use of firearms in the past, but after this incident we will consider allowing their use, even in the initial stages of an inspection. that's all for this edition of "newsline." i'm catherine kobayashi in tokyo. tokyo. thanks for joining us. -- captions by vitac -- www.vitac.com