>> hello when welcome to "the journal" ion dw-tv. our top story this hour, germany and china agreed to strengthen times during chancellor merkel's visit to beijing. bp says efforts to stop the flow of oil in the gulf of mexico seem to be working. europe's swelters in what could be the hottest july on record. german chancellor angela merkel has called on china to provide greateccs to its market. in the course of a visit to

beijing, she said she would like to see german companies enjoy the same access to chinese companies have in germany. trade is rising. china is exporting a lot more to germany than vice versa. merkel was accompanied on her trip by german business leaders. they signed deals worth several billion dollars. >> chancellor merkel ride to a military guard of honor in china ahead of talks in beijing. leaders resolved to hold annual meetings to help further strengthen their economic ties. germany hopes that china will invest billions from its foreign-exchange reserves in european markets. the premier _ china's space in europe. he said europe would continue to serve as a key investment market, but china would hold a diversified current investments. the chancellor's delegation includes a large number business

leaders. she said china must do more to ensure market access for foreign firms before your recognizes it as a market economy. >> the german government believes that once we have discussed these problems further and appropriate measures have been taken, this economy can be achieved. we don't want to see a delay. >> angela merkel met with a hu jintao. she spoke in support of free elections and democratic liberties. >> it is a two for the new containment cap bp installed over the oil well in the gulf of mexico and so far, it seems to be working. it was sealed thursday for test purposes and since then, the flow of oil appears to have stopped. u.s. president barack obama welcomed the news but warned this is not a permanent solution and an enormous cleanup still

lies ahead. >> the undersea flow has been stopped for now. after almost three months, there is no sign of oil leaking out. tests are still under way, but hopes are rising the new metal cap can contain the massive pressure and put an end to the worst spill in u.s. history. >> we will do lots of analysis to make sure it looks like everything is as it should be. i think it is going to be several more days. we need to be cautious right now. it is a great site, but it is far from the finish line. >> president obama warned the cap is not a permanent solution. >> even if a shut-in is not possible, this new cap and the additional equipment being placed in the gulf will be able to contain up to 80,000 barrels per day, which should allow us to capture nearly all the will

until the well is killed. >> even if the cap does hold, it is a temporary solution. bp has to seal off the lead permanently, and that will not happen until relief wells are complete in august. millions of liters of oil have already escaped, doing immense damage to marine coastal life in the gulf, and leaving bp's reputation in tatters. >> let's move on to peter, who has business news. starting with good news. where? >> euro appreciating a little bit against the u.s. dollar. fluctuations must be a headache for exporters on all sides of the atlantic. the currency that bounced back it's the story now. that is how you can describe the euro. it hit its highest level in two months against the greenback on friday, briefly breaking through the $1.30 level. for months, the euro has been dogged by worries over a

sovereign debt in europe. now there are worries over the u.s. economy. >> while unemployment continues to rally in the u.s., american consumers are mostly sitting on the sidelines and on their wallets. the u.s. is taking a long time to recover from the massive economic crisis. europe has bounced back more quickly. analysts say that is why the euro is headed higher. the recovery comes after a long gown spill. the currency plummeted on fears that greece could slide into bankruptcy and worries over europe's massive debt crisis. in june, the euro hit bottom at $1.18. it has gained nearly 10%. investors have regained confidence in the euro. a further reason is the upswing. billions of bureaus -- euros are apparently paying off.

so our austerity programs. confidence is no longer in short supply. >> citigroup and bank of america posted better than expected quarterly results on friday. shares got hammered because the banks said the demand for credit remains weak. citigroup's net income ring in at $2.7 billion. bank of america earned just over $3 billion on the quarter. both had to be bailed out by the government during the financial meltdown. bank of america has paid washington back in full. citigroup has repaid 2/3 of the bailout funding. banking stocks led the broader european stock market lower today as investors study the details of the citigroup and bank of america results. our correspondent has more on this and other highlights of the trading from the frankfurt exchange. >> hefty losses for the dax just before the weekend and that

eradicated the gains. it posted before, during the first phase of the week. the weak start on a positive note with lots of quarterly results coming from u.s. companies. the move slowly improved. fears set in that the economy in china and in the u.s. might sour. also, that dampened spirits here. bmw clearly the winner of the week. the company as saying because of the high demand for premium luxury cars from germany, especially for its cars, it was upgrading expectancy for profit and sales this year. >> taking a closer look at several market indices in a bit more detail -- we stay in frankfurt. we see the index rose about one 3/4% lower. in new york, the dow industrials closed friday's session down

about 2.5%. on to the currency markets, the euro is trading for $1.29. well, it is the largest penalty ever slapped on wall street bank. goldman sachs agreed to pay $550 million to the u.s. financial markets regulator, the sec. the sec is dropping its fraud lawsuit against goldman. the government claims that goldman sold securities that were meant to fail. that is a tactic that contributed to the financial crisis. goldman is not admitting or denying any responsibility. >> there were three months of testimony against the investment bank revealing embarrassing details. just before the house and bubble burst, goldman sachs was advising clients to invest in real estate funds that contained bad debt. in doing so, goldman covered up the risks. clients lost 800 million year rose 3 toeuros. -- euros.

>> this is a stark reminder there will be a heavy price to be paid. full disclosure, honest treatment, and fair dealing. those principles do not change, regardless of how complex the product or how sophisticated the investor. >> part of the fine will be divided among injured clients. ikb will get 150 million euros. about 77 million will go to the royal bank of scotland. goldman must pay back about 12 million in commissions. the rest of the money goes into u.s. state coffers. the case does not end there. while goldman sachs rejected every accusation of fraud, it did concede the company's prospectus on real estate were incomplete. smaller investors could use this argument to seek damages for themselves as well.

for goldman sachs, it is not yet the end of the story. >> dimler posted preliminary earnings of over 2 billion euros for the second quarter of this year after a loss of 1 billion last year. it credits the rapid rise that exceeded market expectations to strong sales in china and the u.s. the car maker expects to increase its projections for the full year after the completed figures are published on july 27. they should have been much better results. we are talking about an google's earnings, the largest internet search engine. 1.5 billion euros in profit in the second quarter. that is an increase of 24% from last year. the search engine giant earned most of its money from the advertising that appears alongside search results like this. during the economic downturn,

firms held back on expenses in advertising. now things are once again beginning to pick up. >> thank you. here in germany, one of the country's most senior women bishops has resigned in the face of claimed she failed to stop sexual abuse by a pastor in her diocese. witnesses say that maria jepsen, the lutheran bishop of hamburg, knew about the claims in 1999. she said she first heard of the abuse allegation earlier this year when she also made the news public. >> maria jepsen says the allegations of damage to authority, forcing her to resign. >> doubt has been cast on my credibility and i do not see myself in a position to continue to spread the good news, as i promised god and my conversation i would do during my inauguration as a bishop. >> it is alleged a lutheran pastor abused boys and girls here near hamburg in the 1980's.

the pastor's own stepson says he was a victim, but he says it took many years before he felt able to raise his voice in protest. >> i have come from a very difficult situation. that man used to stand there and preach the word of god from the pulpit every sunday. there was simply a huge gulf between the two of us in terms of our social standings. my credibility as a victim was less than that of a pastor. >> in 1992, she was ordained as the first female a lutheran bishop, marking the end of the 2000-year-old taboo. she set about doing things her way when elected. she reached out to minorities, advocated a bigger role for women, and greater expense of homosexuality. when she heard about the allegations against the pass from 1999, he was transferred, but not punished. she said it was not clear read

the time it involved pedophile sexual abuse. with her own credibility brought into question, she said she has no option but to resign. >> the german defense minister was forced to cancel a visit to front-line troops in afghanistan friday after clashes broke out with taliban insurgents. he had to abort his trip and return to a german army base in the north of the country. on the second day of his visit to afghanistan, he said germany's mission is entering a crucial phase. in recent weeks, the taliban have stepped up attacks on international forces. germany has four and a half thousand troops stationed in afghanistan. the russian parliament approved a new law widening the powers of the secret service. under the law, there would be able to take action against people suspected of wrongdoing even without evidence against them. president dmitry medvedev proposed the bill, saying it

would help fight terrorism and extremist groups. civil rights activist vera the powers could be used to intimidate government opponents and suppress dissent. american researchers say the first six months of 2010 were the warmest on record. the national oceanic and atmospheric administration says the average global temperature between january and june rose to a new high. much of europe is in the grip of a heat wave, including germany. >> temperatures are soaring in frankfurt. even the wildlife is seeking respite on the banks of the river. >> july is off the charts. temperatures are five degrees above the average for this time of year. we don't know how the second half of the month will develop. next week, we are into the second half. the heat will continue.

>> germany's farmers saw massive losses. their crops are simply with the ring in the heat. the long stretch of dry weather in the state of brandenburg means forest fires are becoming a problem. in russia, fire fighters are also battling the flames. it comes as no surprise that fans have proved the best seller. those who can afford it are having air-conditioning installed. if the heat wave continues, it will be moscow's office july since records began. >> this is not for me. i would rather have really cold weather than this heat. >> cool places are hard to find, even at the seaside. this year, the water in the baltic on the coast is as warm as the mediterranean sea. >> to the 12th stage of the tour

de france, it was one of the long the stages of this year's race. it took riders 210 kilometers. after almost five hours in the saddle, the race ended with a short but punishing climb to the finish line. >> he claims the yellow jersey, but he lost ground to his main rival in the overall standings. the final 3 kilometers were the most grueling, with a short ascent up one of the toughest hills on the tour. alberto went on the attack, leaving others in his wake. only rodriguez could keep up with last year's winner. for the first time, schlep looked vulnerable as he struggled to close the gap. the battle for the overall race

heats up. >> it is strenuous just watching. >> they tune. we will come right back with our in-depth report.

>> the countdown is running in iraq. the u.s. plans to withdraw the rest of its combat troops by september and terminate its military presence altogether by the end of next year. that will make it a total of seven years since president george bush's coalition of the willing invaded iraq. saddam hussein is gone. the security situation remains precarious. infrastructure is poor. basic amenities such as electricity and water are in short supply. the economy is slow. as the deadline for the u.s. pullout approaches, iraqi troops and police are preparing to assume full responsibility for security. u.s. forces have been handing over control of prisons.

military bases such as this one is near the city basra. violence has dropped sharply in the last two or three years. shootings are still common. sectarian strife between shias and sunnis remain an ever- present danger. will the government be able to keep a lid on it without u.s. forces? what is life like for ordinary iraqis in 2010 with the final pullout just one year away? our correspondent went to one district. here is what he found out. >> directing with a machine gun. the message is simple. don't question authority here. these men are not police. they are members of a citizen's militia. their boss is someone who seems happy in the role. he has 50 man under his command.

all were trained by u.s. forces, but their local people. the aim is to prevent attacks. >> we protect our area from terrorists and from enemy militias directed by iran. earlier, there were many attacks. now it is better. >> we never had to use to come to this area. for four months, i feel more confident. >> we are in an area of baghdad. most people are portia. many live in fear of car bombs. they see their sunni neighbors as a threat, despite the presence of the citizens' militia. this commemorate a particular -- particularly deadly attack. the violence gives the court for its air of ruin. for many -- many people here are determined to survive. take the barber. his shop is a retreat amid the

chaos. all walks of life meet here and we almost always talk about politics. nobody's happy with the government. few care about the u.s. withdrawal. what is important is the lack of electricity. >> and his brother have to feed a family of 10. it does not bring in a huge amount of money. the only thing that is improve the security. >> i am sick of these politicians. they just care about their own money. the ordinary man has lost everything. >> he gets a sense of the reasons behind such resignation when he goes out on patrol. the government has failed to invest in the infrastructure here or anywhere else in baghdad. he hears the same complaints all the time. why does the government do nothing? the dangers question is, was it

better under saddam hussein? >> before the war, one man clean up this area. every business paid 250. we are paying four times that. nothing happened. this is supposed to be the capital of iraq. >> piles of rubbish build up and begin to fester in the heat. in the summer, that can mean temperatures of more than 50 degrees. the smell makes people sick. the barber is out shopping with his brother. it is friday and the whole family is coming for dinner. they cannot buy much, as business was slow this week. they have enough for some vegetables and a little chicken. only bread has a fixed price. for anything else, traders determine the price. >> life has become very expensive. the traders are always raising prices because the government does not check. they charge what they like.

>> this is one thing the family cannot afford. it used to be affordable for most iraqis before the war. now? >> fewer people can afford it. sometimes i sell two or three a day. sometimes none. it is annoying, but what am i to do? people have no work. >> little wonder that people sometimes lash out. he arrived too late to stop this fight. it was just a small car accident, but the two drivers attacked each other. now, he attempts to stop it from escalating into something worse. >> it happens regularly, he tells us. people cannot cope with their lives anymore. >> the barber and his brother

are on their way home. the whole family is coming to lunch. that is, the family members who are still here in baghdad. two of his brothers fled to europe. his wife and his two sons went to sweden two years ago, when the attacks became worse. this young woman is also dreaming of another life. she does not want to abandon her mother. she shows us how they made drinkable water out of the substance that comes out of the taps here. >> by phil this container with tap water and i wait two days until the grunge has settled at the bottom. >> it is lunchtime. we asked about the u.s. withdrawal. as shia, they are thankful to the americans. the war meant liberation from some. they're not sure if they regret

seeing u.s. troops leave. >> we were told everything would be better after the war. that did not happen. nothing has changed in seven years. we are very disappointed. america did not really improve things. >> it is our politicians' fault, not the americans. i think a lot about how we should improve the country. i don't see a future here. >> then, at our request, he speaks with his two sons and his wife on the phone. they have not seen each other for two years. >> how are you come a little one? you taking your medication? why are you crying? mom should get you some ice cream. >> a hopeless father and a desperate family.

>> i have to make sacrifices for my sons. things are better for them in sweden. here, all they have as dirty water, garbage, and filth. i hope i can see my sons again. time is working against me. >> it is the end of another day. the men drink tea and playback them. he cannot leave this area because he has enemies who consider him a traitor for having worked with americans. he is sorry to see them leave because he does not trust the iraqi government. the promise to pay him and his men, but they rarely receive any money. that is why he request financial support from local businesses. you could call it protection money. plenty of other baghdad neighborhoods are just like this one. >> that is our report. thanks for watching. stay tuned for more news and

information. >> of forecast for germany -- in the east, storms will cool temperatures down slightly. it will be overcast in many areas. only in the west will it be sunny. plenty of sunshine in the coming days with highs of up to 32 degrees celsius on tuesday. elsewhere in europe, temperatures in the british isles will hover around 22 celsius, but the heat wave will continue on the continent. here's a look of the forecast for selected cities around the world.