. >>> investors now waiting for hsbc. they report in the next 15 minutes. >>> silvio berlusconi tells thousands of supporters he will begin to back the shaky coalition. his firm trading higher on the deutsche bank upgrade. zblrj >>> we kick off with the second reading of the eu services. private sector returning to modest gross in july. pmi suggesting the economy starting to stabilize. business expanding for the first time in 18 months. the market using composite purchase managing index up to 58.5 from 48.7 in june. breaks the 50 threshold for the first time since january 2002. headline figure revised up a tick from the permanent reading of 50.4. slightly better. that's just taken the euro/dollar to the best levels of the session at 132.89. below 133. trading tight ranges on euro/dollar. joining us is jonathan tapper. nice to see you today. the pmi is now almost just about in expansion territory for europe. are you confident that we finally got -- after two years we finally got some sustainable growth coming back? >> i th

the hsbc flash number now above that boom/bust line of 50. it seems to be converging with the official pmi numbers. is that a clear sign of stabilization also on part of the smes? >> yeah, i think the china pmi was a genuine surprise there has been some good hints in the numbers released so far this month, the industrial production numbers. but i think there is a bit of a mistrust on the data at the moment, the trade data, some suggestions it has been distorted by some sort of company trying to gain the capital account system. the hsbc pmi number is seen as one of the more reliable figures at the moment. it is encouraging it propped above 50. i don't know if this is the end of the story, they do have a lot of structural problems, if they're serious about cleaning up the credit system and trying to choke off some of this rather ponzi style lending, then i think it will be a struggle for growth, not just the rest of this year, but probably for years to come. certainly encouraging there has been a bounce. i think if you look at the policy, the p

and this is against the backdrop where we saw hsbc come out with disappointing numbers yesterday andhere is concern about the emerging market story, where is the -- >> the asian -- these banks have benefited, right, from an asian growth story, and now hsbc clearly, that's -- we saw -- we saw this with diageo. >> bank stocks and beer stocks, exactly the same. >> yeah, well, you know what i mean, but they have been -- they have done well in investors' minds because they benefitted from information growth story. now, clearly there is a change in tune with diageo, there. >> with hsbc, the uk part of the bank is doing well. i think these banks have enjoyed ten years of growth while other banks have stalled quite substantially. yesterday, we heard from stuart gulliver saying emerging market has slowed, but we believe in the long-term picture. peter sands, the standard charter chief exec is expected to give some kind of commentary later today. i'll be listening to that call. and he'll be probably outlining where he sees that growth. the business world, i don't know what you can see on your

the hsbc number was weaker. how have we reacted to that? sixuan has more market reaction for us in asia. hi, sixuan. >> thank you, ross. a positive session in asia this thursday. nikkei 225 is among the top gainers, closing higher by 2.5% with a weaker yen helping exporter stocks. shanghai composite added 1.8%. better than expected official pmi data boosted market sentiment. the state council also pledged to step up spending on urban infrastructure projects and public services. manufacturers facing overcapacity issues enjoyed a relief rally. in hong kong, amgang steel and rongsheng industry surged over 12% after announcing plans to issue convertible bonds to a private equity fund. chinese property stocks also extended a three-day rally after latest data shows july new home prices jumped nearly 8% if a year ago. while a top official says the price increases in first year cities are not severe, and the trend will continue. and on to some big movers in japan. toshiba shares slumped by about 3% as its q-1 profit missed forecasts. panasonic on t

if we look at some news increase that shapes trading, shares in hsbc dropped more than four percent and wait on the stock market monday. the net income was $10.3 billion in the first half of the year. were hoping for a lot more. shares in apple gained ground on wall street monday. it followed a decision by the white house to overturn a ban on bringing certain apples into the united states. apple infringed on patents held by the self korean rival samsung. south korea says it is concerned over the move. we will have to leave it there. thank you very much. now it is time for tonight's media watch. isjoining me for media watch james creed. good evening. want to talk about a very serious subject. morocco's king has been forced to reverse a royal pardon. it was a huge public outcry. >> rants 24 has been covering it a bigekend. this has been shock wave as far as the menarche in -- monarchy and morocco. the sticky look at some of the headlines. fury over the pardon of daniel galvan vina. to bend to the pressure on the street which is essentially unprecedented. we are seeing the head of the pris

among them, hsbc. ftse mib seeing some bright spots, up by .3%. what is keeping us busy in europe is, of course, earnings. vesta shares are rallying after the danish wind turbine maker named better than expected profits. shares are up by almost 10%. heineken reported first half sales and net profit that fell shy of expectations and the company delivered rather weak outlook as shares off by almost 4 hr 4%. carlsberg down fractionally. a flat operating profit in the second quarter, also missing forecasts, but the danish brewer brought back its full year guidance. we'll be speaking with jergen buhl rasmussen, the ceo of carlsberg in about 30 minutes time. >>> this is a check on the bond markets, where we did see treasury prices making a bit of a comeback after declines for almost two weeks. so yields actually fell a little bit. we are still close to those two-year highs, though. maybe a little bit of bargain hunting. certainly this is also the picture that we saw for bund prices. in terms of the yield, we

. >>> in other news hsbc is reportedly closing the bank accounts of over 40 different embassies and consulatesey have been trying to clean up a tarnished image after record fines for handling assets of iran, libya and drug car tells from mexico. >>> car fax is out with a new study that shows hundreds of thousands of hurricane sandy flood-damaged cars are back on the road. the report says unscrupulous sellers are cleaning up the vehicles for resale. although they look good, only a trusted mechanic can tell if the car is worth dieing. >>> lottery dreamers, listen up. powerball is now at 400 billion buck. jackpot is the third largest jackpot in history. the next drawing is wednesday. mark your calendars. >>> the nfl is back and the rest of your sports highlights with richard lui. that's next. like taking a first. and then another. and another. and if you do it. and your friends do it. and their friends do it... soon we'll be walking our way to awareness, support and an end to alzheimer's disease. and that? that would be big. grab your friends and family and start a team today. register at alz.org

hsbc talked about weakness in china and elsewhere hurting them. diageo talked about that and was key to emphasize america. is there a sense that some of those stocks that had -- we were buying because they had emerging market growth have suffered slightly? >> chinese economy has gone through a massive change at the moment and will continue to go through a massive change. they have got to make this transition from a very construction, infrastructure led economy to more consumer based economy. and that will not be frictionless. that will be bumps along the way. i'm not saying they can't do it, but will not be frictionless. the chinese have to get much more engaged with the economy. and they'll have to stimulate growth in other areas other than just moving roads, trains, bridges, et cetera. they have to really -- >> also the core inflation report today out of the bank of england. waiting to see if we get forward guidance. they'll try to anchor the short end of the bond market. what is your view of gilts at the moment and what is happening with bond f

still with us is dara at hsbc.president obama made it really clear to us that he wants summers to be the next fed president. all of a sudden, he wants more space. >> yeah, i mean, the way the media -- that seems to be the case. we have not heard anything from the white house to suggest otherwise. he wants to make it appear as a kind of decision process. only one guy in the lineup so far as you're concerned, not really a process, why don't you just tell us tomorrow. he's trying to make it more into a debate, more of a process, which it is, i'm sure. i'm sure there are other candidates being considered, but for the market, the market says it seems obama wants summers and maybe the market wants yellen to a degree, because she's seen as so super dovish. >> what would be better for the dollar? given the positioning that we're seeing in the market now, it has been very long dollar positioning of late, maybe that has been unwound a little bit, but summers probably the more hawkish guy. >> yeah, and anyone other than yelle

hsbc. standout for the wrong reasons. down 4% today. profits on the pretax side up 10% to $14.1 billion. but earnings falling short of expectations due to a fall in revenue. revenue down 7% for hsbc. it said growth muted in western europe, that's hurting. also growth in china and asia flowing while regulatory reform adding costs for banks as well. stock down 4%. better news generally across the piece for the european economy today. first of all, composite pmis for the eurozone. they hit 50.5. it's the first time we've been above 50 since january 2012. mild expansion. that helped us a little bit firmer on the equities. it actually also meant an implication for bonds. we saw gilt yields rising after strong services pmi out of the uk. hit 56.9. composite pmis for the uk best since the series began back in 1998. back to you guys. >> very cool. ross, thank you for that. >>> let's talk about other global news. new zealand's fonterra saying it found an ingredient in some of its dairy products contained a strain of bacteria which can cause botu

we are overweight in the bank sector, and i would take issue with the folks at the hsbc, because what the u.s., the financials are leading the way. so that the european earnings season is weak if you strip out the financials, but if you include all of the financials, it is a small increase. so it is right to look at the financials and the banks in particular, and the likes of hsbc and standards have been sort of long held positions in europe, because people have avoided the domestic plays. we think that people are going to start to focus on the domestic names and they should do better. >> okay. an important place to watch for the turn around. graham seker out of london. >>> and now over the rick santelli with the exchange. >> well, i'm glad we do it on the fly. you guys came to me early and i have fun coming early, and this is interesting. today's data, trade deficit 34 billion and change and the smallest since november of '09. why is that important? because much of the good news, and it is great news, on the narrowing of the trade deficit has to do with energy whether we export more

five year cds on hsbc, on standard charter, the asian banks, that's where the crisis is this time around. five years ago it was in the u.s. with lehman. now the asian tensions will drag u.s. stocks lower. >> all right. jack, we're uncertain about profits. we're uncertain about the economy. we're uncertain about the fed's policy and interest rates. we're also uncertain about the new fed chairman which is going to play a role more and more. there's this crazy public debate going on in washington between janet yellen and larry summers. awfully hard for stocks to hurdle over those uncertainties, isn't it? >> absolutely, larry. that's one of the reasons why a month ago i got upset about it. it's contracting over the last quarter. even if profits are picking up with that top level contracting, it's going to be very difficult for us to get some momentum. having said that in the tapering talk, there is no way the fed can taper. listen, the numbers have been coming out so weak and we have been talking about them week after week, there is no way this fed can taper. if they do, they will send this

talking from the hsbc, bouillon demand is develop strong and weak institutional demand allow people tryingo figure out when we'll see tapering and bond buying happening, whether that happens in september or not. all of those factors are leading to a lot of give and take here in the gold market and a big reason why we're seeing basically unchanged territory in gold going into the close. >> thank you very much, sharon epperson. >> here at post-nine, the trading action with bob pisani. >> no. >> didn't have a very good auction, and the market is flat. it's the third down. i know what you're going to say something. >> the hawks and doves on the fed are all aligned and they say we believe tapering will happen sooner rather than later and the market didn't have much decline. ten-year yields have moved down since the auction happened a short while ago, but overall, even before that, yields on the dunn side, a sign the bond market is not particularly concerned about what's going on. some in the bond market won't believe the bond will be tapering. >> sort of a materials. consumer discretionary fina

hsbc also losing ground.reporting that the bank's revenues slowed faster than forecasts, concerns here about the impact of slower emerging markets. and finally, ending on herbalife, rising today. cnbc reporting that bill ackman's pershing square lost 2.2% in july. ackman, of course, has a short position on herbalife, now up some 100% this year. kelly, back to you. >> all right, josh. and on that note, the herbalife saga continues. now pershing square's ackman is getting the s.e.c. involved. he has filed a complaint with regulators after george soros made a big investment in herbalife, news that scott first reported here on cnbc. >> kelly, the petition addresses concerns that soros is in violation of some insider trading rules by alerting other hedge funds at an ideas meeting about his big bet on the nutritional supplement maker. joining us now is former s.e.c. chairman harvey pitt. mr. pitt, welcome. >> good to be with you. >> what do you think about mr. ackman's claim here? >> well, i think this is -- seems

. >>> hsbc stock is losing ground in today's trading session.urope's biggest bank posting lower than expected quarterly growth. the stock is up about 4% this year but down 4.33% in today's trading session. >> a developing story we're closely monitoring. the state department extending the closings of some u.s. embassies amid what the obama administration calls serious and credible threats by al qaeda. diplomatic facilities will remain closed in many of the countries you see right there throughout the middle east and africa until at least august 10th. >>> the global travel alert coming at the same time as a global travel conference is taking place in san diego. jane wells is there live. jane, how is the global industry taking all this in? >> well, they are sort of processing it today, this is the global business travel association meeting, 400 companies and 7,000 people, all of whom are getting used to traveling in a more dangerous world. >> business travelers have become much more accustomed to it, and in a global economy you know that you do hav

we're expecting a report card from hsbc, hang seng bank and liam man paper.e data front, waiting for china services pmi. >>> still to come on the program, egypt's government is calling on supporters of the ousted leader muhammad morsi to abandon forests as the finance minister tells cnbc that he's optimistic about the economy. more after the break. ♪ [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ] >>> egypt's government is ramping up pressure on supporters of ousted leader mohamed morsi to abandon the protest camps. it comes after the government said it was prepared to take action to end a two-week sit-in. this comes as the finance minister for the country said the country could reach 4.3% growth this year. it would be extraordinary. that sort of growth figure with the sort of trouble that we have got seems to me rather exce

it is the like it is like the goldman's, ubs, morgans, hsbcs.ed pomo, permanent market operations so almost on a daily basis we see the federal reserve come in and make bids for paper, newly auctioned or recently auctioned in the hands of the primary dealers. the primary dealers give the fed securities and the fed gives them money and for the most part it is that money we want to pay attention to. this is a chart prepared by wall street examiner. they're contributors to zero hedge, a fairly popular website. it is a great chart. we'll keep it simple. this blue line represents what we call the soma growth. what is soma? it is where all the purchases of the federal reserve, that's the portfolio, that's the part of the balance sheet, you can see them on. among other things they own, a big driver of somo balances are the mortgages and the treasuries being purchased by the federal reserve. you can see the crisis right here in 2008, and you can see the fed's balance sheet was roughly a half a trillion, and i think that is important to pay attention to

hsbc saying 1500 or so last spring. were they off big time. cnbc reporting on their network. we have tried to be very cautious about telling anybody what the floor in gold is, at least i have been, you cannot put a floor on gold right now. even the big hedge fund guys are moving in and out of it. ashley: thank you. turning to oil, this rising for the fifth straight day. fox news contributor in the trading pits of the cme. no doubt the crisis in egypt providing some support for crude, right? >> even when we're talking about the increase of the tapering pushing gold down a little bit, it did not keep it down there. it is not just egypt they have to worry about, they have to worry about a lot of tropical storm activity that may or may not impact production. what we do know is at this time it is impacting some of the platforms in the gulf. lot of platforms being evacuated because of this low-pressure system that is right now in the mexican area going into the gulf of mexico into the bay overland. that is also impaired in gold. another tropical storm that could end up toward the g

we heard from hong kong, hsbc and standard charter the other day, in terms of sectors, et cetera, itwell to introduce one particular part of regulation, but that isn't necessarily the same in the u.s. they're looking to do things a slightly different way. until you get that regulation, it is going to be a difficult and fragmented way for global companies such as aviva and prudential who give us an update. >> you read my mind. i was thinking, how does aviva compare to prudential from what we know right now. when it comes to exposure to asia, how exposed do you want to be at the moment? >> prudential hasn't been without its problems in the takeover. having said that, it probably has more of a global presence than aviva. it is probably seen as a slightly preferred play, though i have to say, the consensus for aviva has recently, recently improved and you've got that cash generation and dividend yield as well. so all things considered, and bearing in mind that aviva is in the middle of a turn around, prudential is probably slightly preferred out of the two. >> looking at this chart, as y

manufacturing numbers and, of course , the china hsbc pmis as well. in terms of the bond markets, we are continuing to seeing yields for the treasuries of ten-year treasuries at around two-year highs. but back below the 2.9% level, now at 2.88%. ten-year bond yields at 2.93%. treasuries were largely unchanged but took a bit of a dip they did rebound just a little bit after we saw that rise in weekly jobless claims. we're still close to the two-year highs. in the forex space, we're back to the other side of the wall. the euro dollar is coming under a little bit of pressure, but, again, this is down to dollar strength. and this is also very visible in the dollar yen pair which is up by around a quarter of 1%. this pair is trading at a three-week high. this is also because the yen safe haven appeal is easing somewhat. the aussie dollar coming under pressure, a touch, off by around .1%. sterling dollar pretty much flat at 1.5587. but details for the second quarter gdp reading in about 25 minutes' time. in asian markets, it is fairly positive end to what h

also keep in mind for the shanghai markets, china hsbc on thursday. want to revisit that everbright story. china's everbright securities says it will have to sell off assets and raise more money to deal with the fallout of a major trading glitch. that's according to reuters. the brokerage has apologized for computer system problems on friday. that triggered this 5% spike in the shanghai composite. the problems forced ever bright to build up big shore positions and the brokerage remains under serious scrutiny. this morning everbright admitted to a mistake in bond trade due to human error. everbright says its proprietary trading arm has been closed for three months and regulators have limited its new positions in stock index futures. its stock was halted today but will resume trading tomorrow. and here's what's still coming up on the show. a slew of positive data suggests the uk housing recover is on solid ground but could a new bubble be forming? our next guest says it's just the sign of a buoyant market. we discuss coming up after the break. [ male an

>> i mean, look at the fines that were levied against uk banks, people like standard charter and hsbce to a billion dollars. so these are not small amounts of money. remember, white collar crime in the u.s. is criminal and it is heavily gone off and very political from the attorney's office. these people are political bodies and they're looking for support. if you look, i want to pull out one quote, mr. martin said in one of these quotes, i'm a trader, he tells the controller, on this, on several recorded calls and he says i don't mark the books to u.s. accounting rules. what are you expecting? these are some of the behaviors you think have actually come out of banks and are against the culture. and that's what the u.s. attorney general was pointing to. how much of this is under the watch of jamie dimon and the culture of the bank? >> he's come under a lot of fire for that. but his head is not going to be rolling, we know that. again, i find that huge story extremely fascinating as to, you know, who gets charged and who doesn't. he's apologized many times. we know that. helia, thank y

. >> the hsbc purchasing managers index was true. that fell from 48.2 to 47.7. >> but the pmi number -- the thing that people look at -- i don't know if they're supposed to look at it or not, but that went up and was supposed to go down. >> everyone expected it to fall from 50.1 down to 49 point something, going from expansion to contraction. instead it went up. it is not consistent with what we know about the chinese economy. so, yeah, i think it is fitting. as the economy deteriorates, the gap between what the government tells us and what is really going on, i think is widening. >> i wasn't hear when this conversation apparently happened. joe was referring to the past 15 minutes, the idea of what you should be focusing on, what guest was it -- what we should be doing is looking at consumption as the statistic as opposed to output. >> imports are important because it shows domestic demand. it shows what manufacturers are really doing and shows what chinese consumers are doing. imports, of course, they fell in june. this is really im

they took over operations from hsbc in south dakota. this is basically one of those companies that's very committed to hiring our heros. they pay 4 1/2 million dollars into the hiring for heros program last year and continuing to look for veterans as well. >> gretchen: good news. let's talk about employment options, inc. >> this is a work at home opportunity. i get a lot of e mails about work at home jobs. e for people that have disabilities, this is a good one. this is what they're looking for. people with disabilities that want to work at home, especially if they want to pick up extra holiday work. it's 1,000 jobs. this is again work at home. 7 to $20 per hour. it's customer service work is basically what it is. but using the phone. >> gretchen: this one is making >> gretchen: this one is making toppers pizza. >> i know. they're look for college kids, too. >> gretchen: that rules us out. >> anybody in college can afford to eat a pizza. they're specifically look for people, especially college students, indianapolis, minneapolis, cincin

keep in mind about the stocks, hsbc trading today, the xetra dax is up by .25%. back to the earnings. we had two beermakers in europe report numbers and both were a little bit below expectations. but the share price performance is divergent. carlsberg in denmark up by almost .9%. again, numbers were hit by weakness in russia and western europe and the outlook that the company gave us, that was fairly bleak as well. it is saying that the uptick in uf europe is going to be very, very slow. heineken off by 3%. net profit in the second quarter dropped by 16% and the company gave us an extremely muted outlook. so we're seeing a lot of pressure in those shares. finally, a quick check of the forex markets where the dollar is gaining a little bit of ground against the euro and the yen. sterling dollar at 1.5687. euro dollar back below the 134 level. and dollar yen sitting at 97.44. back over to you guys. >> carolin, you doing -- what are you doing, climate change week? is that what you're doing over there in europe this week? is that something that is happening? >> absol

. >> the hsbc measurement was different. >> i believe the good numbers and not the bad. how about that? >> that's perfect. that's per feskt. that's the way the market is operating. >> the claims today, the jobs number tomorrow, one day left to nail the number and win a pretty good prize this month, i'd say. tweet us the numbers, @squawk, and the prize is a duffle bag, you name it, simon, "squawk on the street" gang, one minute until the friday release at 8:30 to submit your predictions. best of lusk. >> it's a big number. definitely. speaking of big numbers, by the way, i know we got to get to this yelp -- >> huge. >> -- the fourth. >> it will open at 47 and change. >> it will go higher, 50, 53, maybe 55. facebook, schlumberger, starbucks and now yelp. >> yelp. i'm glad we got yelp. is would worried there. >> don't underrate yelp. >> why? >> because they have a model that works better on mobile than desktops. i was going over that quarter i got to tell you, it's an outstanding number, it was a tw two-person company ten years ago. they have more cities. if you want people

hsbc, nice note drawing attention to the term premium issue this morning, again, to the volatility inhe bond markets is saying they think the ten-year is headed to 2.1% in a year's time. >> what? >> yeah. exactly. >> come on. the consumer product goods -- >> before gdp this morning. >> package good stocks are going down. those are great proxies for the ten-year. >> the market in which sees the ten-year closer to 3.1%. they're arguing isn't taking this enough into account. jim, you're right. if the economy strengthens. we can support a higher ten-year. if they don't, guys, there could be room to go to the downside here. i know that's not -- >> i'm thinking like a jim mccoggin who says four is the pain threshold. that's the g-force at which you do pass out. >> we were talking about real estate. we're above five. mortgages, people say, whoa, 5 1/2, 6, those are -- now, you know, everyone says the same thing she did. hey, i first bought my house and i got eight. that is not what -- oh, well, so these rates are low. the affordability is not as good as it was. >> in my experience, if you're

the flash hsbc was better than expected. a lot of new orders.activity in terms of building power lines across china. of course, used in those power lines is copper. copper is responsible for about 40% of the demand for refined copper around the world. so that is one of the big gainers. another gainer is natural gas ahead of the inventory report that's due out at 10:30 a.m. we're expecting to see an injection into storage of about 67 to 71 billion cubic feet. if it's smaller than that amount look for further upside in natural gas. keep your eye on the forecasts which are getting hotter for many parts of the country. back to you guys. >> thanks, sharon especialppers. >>> we're watching the tesla complex today, jim. phil lebeau will be on talking with elon musk about how he's tired but excited about the prospects for the company. doesn't stop steve from coming out and saying they're going to sfas some threats soon. >> phil lebeau is the best because of what we saw earlier today was an fascinating interview. everyone has to stick around for it. i li

frederick newman is at hsbc and joins us now from hong kong.rederick, thank you for taking the time to speak to us. the selling in indonesia, is it overdone? is it panic selling? >> i think to some degree yes. and certainly there is a lot of spillover here, if you will, contagion from india. people are reassessing the fundamentals in emerging markets, but i'm not quite convinced that indonesia is really in such a challenging state as the markets currently suggest. >> still, if you look at its current account deficit of gdp, 4.4%, india is at 4.8%, the two aren't really that far apart. and we know that the markets have been really focusing on those countries and emerging asia with those very, very weak, very high current account deficits. >> that's right. so the current account deficit is currently the focus of the market and globally, i think, its current account deficit countries didn't get hit the most. remember that indonesia's current account deficit is also showing signs of narrowing quite rapidly. it is due to some one off factors that re