and also, the shanghai composite was expecting 2009 lower and the fact that now the shanghai composite is down almost 20% from the top almost two weeks ago could be a bit of a concern. for if we're just looking at stocks. looking at china, i think recently there's been a a lot of speculation about how large a degree the speculation inside of china in commodities has been playing out a factor in this market. definitely there's been a huge impact on australia and the perspective going forward for us, also, the anticipation for australia and we have some indications that even the western hedge funds have been becoming active as physical speculators inside of china with regard to commodities. and i think that's a bit worrying. because also, the way the stimulus packages have been working is that they really have not been active yesterday. so the big infrastructure projects have not begun yet. so there is been a huge stockpiling of commodities in china recently. >> david, what is the european market's angle on the move we've seen originating from asia? should we expect the european market j

we seem to be following what's going on in shanghai. it's got a lot of people wondering whether maybe this rally that we have seen this summer is really starting to peter out here and we're due for a pullback. what do you think? >> well, it's a great question. playing out essentially from what happens in july. july was a replay of the first half. the drawn yao the first two week wag parked by a rally in earnings in q2. at this point in time, taking a look at august, i think you're seeing a battle between the real money coming in, people who thought they were under invested in the market and wanted to play the trend. a lot of valuations had become overextended. >> but what's interesting is that if you have played for value, if you have played it defensively, you have not gained in this rally since march or certainly this summer. so one would think you would want to get defensive, you want want to get more cautious here, but you might get hurt again. >> and that is very true. the quality stocks have rallied and people who benefit the most

keep an eye on what's shaking in shanghai while you were sleeping.a live update from cnbc's asia amanda drury when fast money returns. chef's meal with pommes frites perhaps a night at the theater with extra special seats additional hotel night, our treat you world in perfect harmony: priceless look for world on your mastercard to get rewards and offers that matter to you. when people say, hey mike, why ford, why now? i say brace yourself. that gas guzzler in your driveway, just might be, a clunker. but don't panic, it could be a good thing. your ford and lincoln mercury dealers are cash for clunkers specialists. they'll recycle your ride, and get you a big fat juicy rebate from uncle sam. you can get all the details, charts, graphs, etc, at ford.com. why ford, why now? why not? visit your ford or lincoln mercury dealer. i'm thinking now would be a great time. and you know what, it works. nutrisystem for men: flexible new programs personalized to meet your goals. what's great about nutrisystem is you eat the foods you love and you lose weight. i'm da

shanghai, worst fall in 12 months..e having second thoughts about how far the markets have come. >> questions about the consumer too. we saw that with the retail sales numbers from the u.s. government and the consumer confidence number out on friday. a lot of talk about where this is going to go. very strong earnings reports from people and the companies reporting from most of the earnings season. it didn't come from strong revenue or sales but from cost cutting.g. >> the stories over the weekend about how back to school could be miserable.

fourth largest stock market in the world, shanghai index. volume is down 30% over the past month. >> growing. forget all of the stocks and mum bow jumbo. if the middle class is growing? why do they get on the conviction buy list at goldman sachs. >> they were long already. >> they put in a practice rating on all of the base metals. they have been right all through the process of the commodities run. copper is what they found out with. under $2. they're pushing to $3. they think demand is real. they point to china, india. if there's a demand, a true middle class growing out right now, that's what we're looking for. >> is there an economic barometer for economic activity? it's not the same incident that the u.s. stock market is for the u.s. economy. it's nonanticipatory in any way. >> down 20% in the last three weeks, petra down 20% from july 28 and the local market is down 7%. same thing with sinopex. a lot of the big cap names. that's a disconnect i don't feel comfortable playing. >> something you can't play. >> you've got to prefer to play

shanghai stocks bounced up today by 1.8%. some earnings coming out, for example, some of the airline companies in china, air china, for example, coming up with better than expected results and that helped to improve market sentiment on this wednesday here in asia. as for crude oil prices, let's check on the numbers for you now and see how nymex light sweet crude is doing for you at the moment. a gain of 41 cents here. brent crude, front month contract, trading a bit higher, as well, currently standing at $72.34. the weekly u.s. inventory reports coming out today, 10:30 new york time, a dow jones forecast is calling for oil to fall by 600,000 barrels, gasoline to drop by 1.1 million barrels and distillates to rise by 300,000 barrels. what does this wednesday have in store for u.s. stocks? for that, we'll check in with mike in the u.s. good morning to you, mike. good afternoon and thank you, maura. kind of an interesting move in oil after hitting $75 a barrel and closing lower. but here in the states, it looks like the dow, at

look at the shanghai index. what do you say for an index that goes down 70% in a year, then rallies back 100%, and now is down 20% in two weeks. i call that volatile. tradertalk.cnbc.com. rebecca, how are we looking over at the nasdaq? >> hey, bob, we're looking higher, but just as much as china is the story for stocks there, china has a lot to do with the story of stocks here. as you heard from maria bartiromo at the top of the show-n her conversation with hp's ceo mark hurd, china played a major role in their earnings, and we do see that playing out here at the nasdaq as well. also hp yesterday in their earnings report mentioned the fact that essentially they see tech spending bottoming out here. that could be a positive, or it could mean stagnant growth ahead. you do see the likes of dell up about half a percent here right now. cisco, meantime, big tech trade to the up side by 1.6%. google, a happy birthday to google. it's five years old as a public company today. not such a happy day for them, though, as the

as the shanghai sold off, it left a mess of u.s. markets on monday morning.re already down 10% from the highs, and some say headed for its own bear market. as decoupling dies a slow death, is there any way to untangle a u.s. recovery from an unraveling chinese market? let's trade the globe. cnbc asia's amanda drury joins us on set to help us with this trade. so, is it true, can the u.s. recover without china in any way? >> well, i think it's going to be very hard for you boys to get a grip on this, but actually, all roads do not lead to wall street. increasingly, yes -- >> what is that? i can't believe what i'm hearing! >> she speaks in tongues. >> i'm speaking australian. anyway, let me explain it in english. increasingly, it seems as if all roads are leading to and from shanghai, because obviously, economic power is gradually also shifting over to the east, and the crisis has sped this up, right? people are now arguing, if you look over the last two years, the shanghai market has actually been quite a reliable global indicator, a leading indicator as to wha

liquidity is hampering sentiment in the shanghai market. on that note, over to you, bertha. >> thanks very much, christine. here in the u.s., the futures have been mixed this morning. we've got the broader averages, the dow and s&p futures trading to the upside and that's where we stand. right now we've got toy futures up about 30 points above fair value. the american express ceo ken schnault saying things seem to be pretty steady. meantime, john chambers was cautiously optimistic. he thinks we've turned the corner, but is not ready to say we're in a recovery. we're likely to see quite a bit of hesitation this morning. taking a look at the ten-year note, yesterday that yield closed out the session at 3.76%. some technicians saying if we breach that today, watch out to the up side to somewhere at 3.88. we have the unemployment numbers out today and, of course, the big jobs number tomorrow. retail sales are expected to post their 11th straight monthly loss. >> 1 e straight monthly loss. that's -- well, what can i say? we're hoping it will tur

shanghai composite, up 4.5%. the hang ang, get ago boost as a result, 1.9% and the bombay sensex is up 1.6%. this is the last time we checked, trading around the ranges of -- do we have the board for oil? there we go. $73.84. up 1.42. and brent is trading the other way, opposite direction, down 13 cents, $74.46 a barrel. bertha, over to you. good to see you. >> thanks, christine. interesting to see the die veteranence there. yesterday was the day to lead the market higher on an up note as we saw the surprise inventory. we've got dow futures pointing to another higher start at least. they are about -- let's call it close to 60 points above fair value. nasdaq, s&p futures looking higher, as well. we've got a bunch of data coming out today. of course, it is thursday so all eyes will be on the weekly jobless claims. we had a surprise build last week. this week we are looking for a drop. take a look at the ten-year bund yield where it is trading at this hour. right now at 3.28%. we have bonds rallying just a little bi

i mean, in the summer of 1937, japan had--had attacked shanghai. but this--i mean, th--this is the rea--they had--war was--had already broken out. c-span: but what was the reason? >> guest: well, it goes back a long a way, but i--the j--japanese had, actually, for hundreds of years, ambitions in china. it's--it's really--it's not something that--it was not something that just started in 1937. it--it was--it had--there is a long history of animosity here. c-span: what's the reason? >> guest: reason for? c-span: the animosity. >> guest: well, again, you know, we--i don't know if we have enough time to go into this, but there had already been, you know, war between--you know, there was a f--there was a first sino-japanese war and there had been already numerous attempts by the japanese to--to--to carve up par--parts of china. they had already seized manchuria by the 1930s. c-span: wh--what was it and--and what is it about--it--what--was it the japanese character that led to this kind of slaughtering? i mean,wh--what did you find in this process? i ass

china shanghai composite tumbling 4.3%. hong kong followed suit, down 1.7% to a one-month closing low. japan's nikkei down .7, indonesia down 2 1/2%. guy johnson, what's up or down where you are? >> down, mark. yeah, you guessed it right. european markets really catching the cold we saw out of asia. that's ill wind blowing out of shanghai. 30 cac and the european markets down .6 of 1%. yesterday it felt like really a bit of a blip in the dow trajectory. seems to be coming out of china over the last few days has been infecting other markets around the world. tell you about what's happening in london. minutes now from the bank of england today, its last meeting suggesting that king who is the boss of the bank of england wanted a 75 billion pound increase in'sing. he was voted down by his peers. so it only went for 50. that's an indication of how farelefar fearlessly this is out there. let's move on and show you the stoxx 600. we are down by 4% on the stoxx 6 600. down early. trading sideways. i want to show you this. this is

coming up, stocks shrink in shanghai. are we finally becoming immune to the shanghai slide. >> we'll talk about that and get more on the currency markets. the dollar is recovering against some of yesterday's losses. we will try and get something for you on that. meanwhile, on the currency markets, the dollar has tried to claw back its losses against baskets of currency today. euro slshl dollar flat, 1.4348. sterling has been an interesting move. it's further today against the screen, 1.63. for more, we're joined by sam stanley from halo financial. we just had that slight revision upwards in the gdp figure. but sterling really has been sort of getting steadily weaker for the last -- for most of this week and last week, as well. are we coming to the end of that move? >> certainly today we'll provide a bit of a catalyst ahead of profit taking for the weekend. sterling has had a bad week. profit taking on selling sterling is what you're saying? >> exactly. it's had a bad week, it really has. it's been down 1.65 against the do

on rumblings in the chinese markets, but will more shanghai swoon send the s&p into sell-off mode? cnbc's amanda drury is here to help us with the trade as china, the world's growth engine, begins to show signs of sputtering. back in a moment. ♪e helping people save money on car insurance. gecko: aw thank you, sir. boss: but i think there are a few other things you can say about what a reliable company geico is. gecko: right. uh, well maybe how geico's the third-largest car insurance company in america? nice tidbit there. boss: exactly. and i've been thinking,

i cannot invest in shanghai directly. it's very difficult for me, or anybody who lives outside -- >> it's also separate classes, but largely, its the it's a retail-driven market, to a large degree. >> i'll tell you one thing. i think the best bet over the next five years is going to be a bet on the chinese yun going up. and maybe the best play is in australia. >> so would you take the money off the table now, peter, if you made money in the last six months? >> if you're a trader, yeah. the technical indicators are pointing down, get out. and by the way, you might be doing that in the u.s. as well market. >> thanks, peter. appreciate it. man mandy, thank you. see you later. >> thank you. >>> it was five years ago today, believe it or not, one of the greatest ipos of all-time. it was google. but what's the state of the market in that particular area ipo specifically right now? are we ready for an ipo-comeback? we give you the inside track. >> and here is a look at some of the year's higher profile numbers are performing tod

the shanghai market up 0.26%. in terms of nymex light sweet crude, it is trading off $1. $70.53 a barrel and brent right now is trading around the ranges of $72.86 a barrel. >> let get some analysis on the trends we're seeing in these mblths. very good to see you today, linda. in terms of investments, defensive and cyclical stocks, you're not going to get a bang for your buck in this rally, are you? >> i think it depends on how strong you think this rally is. i'm not so optimistic that the market is sustainable. a lot of this rally is based on the earnings forecast. if you look at the s&p companies, some two-thirds of them have beat expectations. but if you see how they've beaten expectations, there's a few things that come to light. one, they're starting with low expectations to start with. and two, the very strong showing of most of the banks, except for ubs, is actually on the back of investment banking with government-backed guarantees and yet bad debts are still being written off. if you look across the corpo

i think that is helping to bring down further the shanghai index. mergeling markets and these accelerate the rebounding process in the u.s. dollar. it's true, last friday we saw both the dollar 0.stocks going up and yield going up. i think the dollar is going to continue to push higher, but the reasons are going to change. it is no longer going to be improved economic prospects. it's going to be risk aversion. this decline we saw in shanghai is very hard to ignore and implications of the sensex in india and in brazil yesterday started to retreat. i think when we go down at the end of the summer, it's going to be more a risk aversion and the dollar is going to gain mainly against the british pound and the canadian dollar. >> ashraf, what does that portend as far as for the u.s.? a strong dollar in this case would be bad news, wouldn't it? >> yeah. it would be a bad thing, bertha, if we're talking about 7% to 10% increase in the u.s. dollar from now, from these levels. do i think it's going to happen? probably not. you know, when you look at the other

everybody is focusing on the shanghai composite. take a look at today's scores, the overseas investors took the news about possible tighter capital requirements in a different way than the mainland investors. how should you read this and how should investors take these cues? >> hi, choey. this is where i do agree with andreas where he says asia is the strongest economy as we're seeing it now. i also think that the regulators coming out saying we knight need tighter capital requirements, i agree, you can see that in two ways. there's a big article out today that icbc has given so much more loans, i think 19% more than last year. if you look just at icbc, they're putting more money into the economy than all the developed countries altogether. so i think that you will still see china, you will still see more loans being given in asia simply because asia has been able to put more money aside in the last few years and the private individuals in asia have more savings than they have in the u.s. however, as we all know, asia is export driv

take a look at the interday chart for the shanghai composite.a lot of concerns about more scrips coming to the market, saying they're going to issue $1 billion more in shares. we're digesting a lot of earnings up. from the oil sector, we have cnooc out yesterday. today we're getting the big, big number out from petrochina, which is the biggest oil and gas producer in asia coming out after the bell and following up. but these stocks are closing lower because nymex light sweet crude did drop below that $71 a barrel. there were expectations in china to increase prices. coming out with first half earnings, they are excited about their mobile division. subscribers rose to $39 billion. with that note, back to mike in the u.s. good morning. >> and thanks, adam. and a pair of key economic reports are out before the opening bell here in the states this morning. the first revision to second quarter gross domestic product will be released at 8:30 new york time. forecast called for a contraction of 1.5% versus the initial estimate of down 1%. still, a vast

. >>> shanghai tumbles, what to expect this week. and the police pay out. your early morning business headlines are straight ahead. >>> plus, were you being tracked down by death this weekend, at the box office that is. >>> jay cutler returns to denver, zach is a pay for the mariners, and california strikes gold in the little league world series. you're watching "early today." >> good morning, and welcome back to "early today." i'm dan kloeffler. here are some of your top headlines this morning. >>> space shuttle "discovery" and its crew of seven are safe and sound at the international space station, delivering thousands of pounds of equipment, food, and outgear for the post. aft naufts will perform three space walks during their nine-day stay. >>> unprecedented political unheefl hit japan after election results show the dem kratic party trouncing the democrats. the leader of the democrats promised to provide the world's second largest economy in a signal thaem signal. >>> a visit that many fear could hurt that island's improving relations with rival china.

the shanghai market and the hang seng tanking. a lot of concerns that the easy money in the chinese mainland is coming to an end. the bombay sensitive index trading down 1.7%. overall, it's all about the jobs report, jobs, jobs, jobs in the u.s. bertha. right, christine. and the expectation is that what we're going to get some signs, that the economy is still shedding jobs, that it will be at a reduced rate. the july jobs report is out at 8:30 a.m. new york time. that would be a big drop from what we saw in june, which was over 460,000. the smallest decline, in fact, if that were the case since last august just before the credit market collapse. the unemployment rate, on the other hand, is expected to tick up to 9.7%, which would mark a ten-year high. joining us now on -- let's call it a super friday. this is a very big jobs data. leo tillman, president of l.m. tillman and coauthor of "financial door wantism" and "max well clark" and i don't know if we're going to get a picture, but we've still got espin. leo, i want to start with

the shanghai composite up 0.4%. data showed lending slowed sharply for the month of july, taking away any concerns of monetary tightening. the hang seng is up 0.7% and the bombay sensitive 30 index up 1.1%. in terms of nymex light sweet crude, crude oil is trading up 0.43 cents, $71.03 a barrel. brent also trading at these levels, as well. brent right now trading across the lines of $73.83 a barrel, up the 33 cents. bertha, over to you. >> thanks very much, christine. this morning, you'll want a double shot of expresso in your la ta. we're going to get productivity up, we'll be watching the start of this two-day fed meeting and bond auctions this afternoon. so plenty to focus on. so far we've got furchd slightly above fair value, taking a look at the ten-year bund yield, the ten-year bund had been higher this morning. we've got the yields now moving higher to 3.5%, a bit of caution lady of the fed meeting this morning. landlords, we've got the auction, the $37 billion of three-year notes at 1:00 new york time. part

the shanghai composite stayed weak. we had news from china merchant's bank, which is the lender, saying it could raise as much as $2.6 billion in a rights issue both involving h-shares as well as a-shares. and it's coming at a time, of course, when lending is being concerned, so there are concerns on when this market can absorb at least the excess supply. now back to mike in the u.s. good morning, mike. >> good morning to you or good afternoon. and thank you very much. here in the states, the consumer is very much in the forefront for investors today. the july cpi is out at 8:30 a.m. new york time. prices are forecast to remain unchanged. the core cpi, which strips out food and energy prices is expected to edge up by 0.1% at 9:15 a july industrial production will be released. forecast to rise 0.6%. the capacity utilization rate is seen rising by half a point to 68.5%. then about 10:00, august consumer sentiment will be out. analysts are looking for a reading of 69. a pair of retailers top alternatings on today's calenda

i think shanghai brought us out and will drag us back in.a two-year basis and hang high front-ran the dow by about four to five weeks ahead of time.. interesting data point to consider, mcdonald's in china has had seven consecutive months of down months versus, up ever where else in the world. that tells me retail demand is weaker in china that people think. >> why do we take the shanghai composite so seriously? on the way up and on the way down. i mean, it's like vegas and yet we treat it as if it's this -- this very reliable metric barometer of global markets and the economy? >> it's actually a reliable metric of risk appetite, which is dragging up and down all of the as set classes around the world. the shanghai has actually been on capitalization basis just been massive.e. it exceeds nikkei and a couple of local markets. china has become the look motive of growth and as it pulled everybody up it will drag everybody down. from a currency point, i think aussie goes below a pound, dollar gets stronger as we go forward. >> thought on that, j

the shanghai composite up 0.9%. late session bargain hunting managed earlier losses. and the bombay sensitive 30 index up 2.9%. in terms of oil, it is getting a bit of a boston from fed comments suggesting maybe, you know what? that could help out command in the oil sector. nymex light sweet crude is now up more than a buck now. $71.34. and brent, as well, should be tacking on gains in line with what's happening with nymex, up 98 cents, $74.39 a barrel. bertha. >> yeah. and we should see a fairly bullish reaction today, particularly in oil with france and germany now out of recession and the fed saying that the u.s. economy is leveling it out or leveling out, she's trying to say, thanks to some of those emergency measures and maybe the fed is now going to ease out of some of those emergency measures. let's bring back bob mckee, chief economist at independent strategy. bob, did the fed get it right yesterday? did they set the right tone? there were high expectations for that statement. >> i think they did. we got a picture from the fed which said, look, things are impr

across the globe, the shanghai composite 4.5% to pull away from bear market territory.so who is leading this global market recovery and does the china bounceback mean it's time to buy now? we bring in dan genter and president of genter capital management. and scott ledler, chief strategist officer. how much on a regular basis are you watching the asian markets to allow that to predict what you're going to do here? and the reason i ask is because typically, historically, people have always sort of looked at the u.s. and said, okay, the u.s. will lead asia. are we starting to see a shift? >> well, within the last year, the relationship has changed. in 2007, when the market broke, the asian markets broke to the down side first. and at that point, it started to lead the rest of the world. and then if you recall in march, they led the first part of the rally. they rallied about two weeks before we even started our move. so when they start to have extreme moves, you need to use that as an indicator on your trading strategies. >> what does it tell you now? >> what it tells us

the chinese market bottomed before our market did. >> are you talking shanghai or hong kong? >> i'm talking shanghai. >> okay. >> their market topped before our market did and their market bottomed before our market did. and i think it's very much the driver. it may not be the biggest economy in the world, but right now it's driving a lot of things. chinese stimulus has driven a lot of things. it's driven a lot of the global activity, the increase in global activities we've seen since the march lows. furthermore, if you look at the march lows here in the united states, we're up about 50%. but those markets, china, brazil, and india are up substantially more than that. so they have been the leaders in terms of investment performance. and when we start to see cracks in these markets, and i think we're going to continue to see some cracks, they're way ahead of themselves. >> okay. >> it's going to impact our market. >> don, you want to answer that? >> i think he's a little too pessimistic about this. it's going to be volatile. but it's a small market compared to ours. it's an im

a shocker in shanghai as chinese stocks have their worst one-day loss since november. so is china's bubble about to burst or can this and other emerging markets keep up the recent rally? cnbc asia's amanda drury is with us. she's here this week at cnbc global headquarters with her take. mandy, great to see you. we're fortunate to have you this week. can you give us a sense of what it looks like on the ground right now? >> it's really interesting because i remember only about six weeks ago when the market in china was up about 90% year to date. in fact, the best-performing index around the world year to date. a lot of people were saying, you know, it really feels like the heady, frenzied bubble days back in 2007, when everybody was wanting to get on the bandwagon and throw their money into the stock market regardless of what the valuation was and what the fundamentals of the market were. massive liquidity-driven asset inflation-driven kind of rally. and everyone was wanting to get on board. now we're seeing a minicorrection, maria, and a lot of people are trying to work

just yesterday in the shanghai daily, some news from a china official says china is wary about fiscal responsibilities in the united states or something like that. when there's talk of that that other nations might not look to the dollar to be their store wealth, going to look somewhere else, then all of a sudden we could go into a free fall, but as long as that talk is out there, i think it's going to keep a lid on the dollar. >> i love your name, i love the way, you know, mr. uirio, i love your last name, by the way. let me ask you a question. isn't that already known? don't we already know that? >> sure. no question about it. >> what isn't known is the fact that money supply has completely dried up. that's -- that's going to put a head wind on this market. let's talk about what's going to occur in the future not what everybody already knows. long-term the dollar is cooked. i understand that. i'm one of those first people to talk about that. but let's just talk about for the next few weeks, we're overextended and there's going to be a rally in the dollar. >> no, i thought it was --

and you can see the excitement, whether it's beijing or shanghai. you see the excitement in every part of china. so i'm very, very optimistic about the prospects of china. and let me add, maria, china has declared that the gdp growth rate is about 6.5% or 6.8%. the way i look at it is the differential gdp growth rate between china and the western world is about 9 points. because the western world's declining about 2 to 3 points. so to have an economy with over 1 billion people, industrializing, growing gdp at a 9-point differential over the western world is a very, very exciting market. >> are you seeing a movement of people moving from the suburbs to the cities? and really adding to that vibrancy that you're talking about? >> i mean, i wouldn't quite call it suburbs -- cities or the suburbs. it's more the interior part of china, not just the coastal part. the superior part of china is also developing extremely rapidly. i was looking at a study today which showed a little rural village in a province and some people have been tracking this developmen

now in shanghai, couples are being encouraged to have a second child.as long as both parents are from one-child families. the move's giving hope to millions of budding chinese parents. betty who had her first child and already wants another one, even though she lives in beijing and her husband has two brothers, she thinks the government will grant her wish in three or four years. >> translator: hopefully the government's policy will be more flexible and it will be easier for us to have a second child. >> reporter: but architects of the one-child policy, like professor, say that's not likely. he says the government's main goal of population control at any cost hasn't changed when the law was first passed. >> translator: to advocate for the one-child policy is not the perfect option. but in order to quickly decrease the birthrate, it's either that or nothing at all. >> reporter: getting to the population target of 700 million's going to take another 70 years or even more if life expectancy continues to rise. tom eagleton, abc news, beijing. >> on tonight'

the shanghai composite off 4.3%. as i send it back to you, it looks like you may be getting a cold front from asia. from where i am, the air-conditioning chills have nothing to do with the weather outside. carl, back to you. whatever it is, it's definitely on the wake. let's turn to the u.s. trading day ahead here. anthony chan and rob morgan, market strategist for claremont wealth strategies. guys, good morning to you both. >> good morning. >> it's been pointed out that china let u.s. equities higher and it appears now they're going to lead us lower. do you see the selling in china overnight and over the past couple of weeks here as irrational in any way or orderly? >> i think it's orderly, carl. the shanghai market had basically doubled and now, just since the beginning of all, they're down 20%. some people are saying it's a bear market. i think that's premature. we've been calling for a here and shanghai is precipitating that a little bit. but our view is that this is a -- i'd say if we came down 10% to 15%, that'

big earnsinings in shanghai. this is one of the biggest banks in the world. morgan stanley said they're seeing price upgrades. merrill lynch came out with a couple of strong notes. so people had a reason fundamentally to come back into this market. the government reaffirmed. the government is listening. we said this last night. they're not in this market trading it, but they are very concerned about sentiment, so that trickled through the rest of the world. did our market go up today because of china? i don't think so. but people sudlane stopped talking about china today. markets were up on a day when commodities were down. china does matter here. >> maybe they were listening to us yesterday. if you take a look at this, we sort of did research. we called up rich peterson over at s&p and we asked him how many times do we see big swings in the chineeds market? 8% of the time in the past year, we have seen swings of 5% or more on the shanghai index. so this is typical. this is par for the course. you're talking about a market that doesn't have any ability to sho

the shanghai index plummeting almost 6%, taking the total decline since august 4th peak to 17%. certainly a big move lower, pointing out today the japan gdp numbers. >> shanghai was well on the way. we're worried about is this a signal because china has signalled this before.e. but gdp, expected 3.9. the problem is the domestic part of this number is dead. and japan needs 7% of their gdp is domestic consumption there even though it's a big export country. and if china dries up and that's the big if. because the export component to china was pretty good. german exports last week, pretty good. but people watch this number. so china as a leading indicator for the rest of the globe. david rosenberg was talking about this today. if you look back to october of 2007 and where that ultimately moved down to, that was the start of all this. there's the shanghai, the shares, the local market in china which was also overly inflated in october of 2007 when all the way down and bottomed in october of 2008, but bottomed before everybody else. >> you know, if you think the dollar's going to con

and shanghai sells off. china is making these sort of nebulous comments about asset bubbles and these various things in the last several weeks and the market goes up and down on it. how much credence do you give this? >> you know, you can't give a ton of credence to it but you have to believe it a little bit. they did say back at the beginning of the year they would ease back on buying treasuries. they've done that a little bit. they're still obviously a major holder of our debt but they've eased back a little bit. i do take some note of what they're balk r talking about and what they're saying is purchasing commodities as opposed to going out and buying other assets throughout the world may be a better diversification for themselves. in that sense you have to watch commodity prices. they've had a bit of a run right now. i still believe in the macro economic theory here, the third quarter is continuing to grow, the economy is glowing brighter and brighter, but prices are stagnating a bit should they decide t

. >> from shanghai, we have a report. >> on its way here, the typhoon killed more than 20 in the fill feens. in taiwan. many are still missing. many spent the night? shelters. goats returned to harbors as waves of up to 89 meters high batered the coast. several hundred homes have said to have collapsed. farm lands >> although this storm is said to be weakening, the forecast is warning that strong winds and heavy rains are going to affect this kind of the country for some time. one of the iran candidates has called into an investigation that some detainees have been raped in detention. >> spanish police are investigating whether the armed basa group is still in operation. the blast which caused no injuries oured after a bomb attack. >> mrs. clinton has urged angola to hold elections and address the country's human rights record. >> we'll have a full business report in about 25 minute. for sugar, the price is going up. >> yes. it has hit a 28-year high. india has had the drive for more. you have to buy this stuff at a higher rate and recover the cost from somebody. it's you and i, the c

that said, an ambitious government stands by its plan to develop shanghai as an international financialtre on par with london and new york by 2020 and this is the time frame needed to determine the credibility of today's bric grouping as a force to reshape the global economy. beyond the financial crisis, countries early to adapt, innovate and cooperate in a world of depleting energy resources should grow in stature. which suggests that some emerging markets could be overshadowed - and that the new world order may need a new acronym. >>abirachad: in afghanistan women have been hiding behind the scenes for de cades with only a few working outside their homes and making a tiny contribution to the economy. buta new breed of female entrepreneurs want to shake things up in one of the world's most conservativesocieties. >>reporter: this is anjela she is a serial entrepreneur from kabul one of her businesses is a furniture firm an ambitious young businesswoman, just 24years old she wants to be afghanistan's answer to richard branson. >>anjela: i have one wish to become in the future as a good b

a bit of warning regarding the shanghai composite index. chinese stocks may fall by as much as 18% to the next three months. stock index futures are indicating a lower open for us on wall street. we are watching silver spring communications today. it has popular networks such as discovery and tlc, and it released its earnings ahead of the bells morning. that is business news at the new york stock exchange. i am reporting for wbal tv 11 news. back over to you. >> thank you. >> it is 5:22 and 67 degrees on tv hill. >> the ravens give suggs boot. -- the boot. i will have that for you next. >> what do you think is the appropriate age for a child to have their own cell phone? email us your response to watercooler@wbaltv.com. hi, may i help you? yes, i hear progressive has lots of discounts on car insurance. can i get in on that? are you a safe driver? yes. discount! do you own a home? yes. discount! are you going to buy online? yes! discount! isn't getting discounts great? yes! there's no discount for agreeing with me. yeah, i got carried away.

the shanghai ended down and the biggest loss since september 19th.you want to play it, what's the best way to play it? long-term, you are extremely bullish on china's economy. this is a set back after a rise. >> it is a set back. we shouldn't be surprised about that. one thing that worries me is a lot of loans that were made in the first half of this year went into cross holdings. companies get loans and then we will speculate on buying other company stock. it's like wal-mart took out a loan and bought a bunch of intel or whatever. if the economy does well, they are underexposed to china and all emerging markets. >> what's the best way to do that? if i want exposure to the growth rate you have in china, i will put something away. >> two ways. etf and the two etfs that i think stand out are fxi, 25 enterprises and well-known and you get good exposure. another is hao which is a basket of small cap stocks that are leading the way in china. >> do they give you exposure to state-owned companies? >> exactly. >> i cannot buy a stock in shanghai. >> they are

>> we should not be letting the shanghai drive our market here.e letting china economic growth be a dictator watch the pmi at the end of the month. merrill lynch and morgan stanley came in and said there will be earnings upgrades. you know, the ipo of the china construction, which was a $7.3 billion ipo earlier, last week, sucked a lot of liquidity out of the market. so technical factors had a lot to do with some of this move down. and that earnings will be good. i think china has got fallen apart. i can this market was overheighted, i don't think it's cheap, and i don't think we should be driving a lot of our commentary off of it, quite honestly. >> what's the best play off china? you were got exposed to the china market, really whatsoever at this point in terms of pure china companies, where would you go? >> well, i think the insurance companies are actually still doing quite well. i think china life is growing, not only their revenue base, but growing their customer base. i do think china mobile is a great place to continue to see growth in 3g

the shanghai market datanked. all that optimism about china leading the world out of a recovery gave way to concerns of rally has been over-done. bear in mind, this market is still up some 60% for the year. hong kong bore the brunt of the sell-off outside china. hang seng, 3.6%, steepest drop in 4 1/2 months. china led thes loes in the hong kong market. sok south korean market is down. indian market is down. sending it back to you. >> thank you very much. >>> up next is bon voyage to the travel channel? julia boorstin has the answer. >>> and then, can we kiss that summer rally good-bye or is this just a pause? word on the street and buzz from beyond as we're getting you ready for a very big market monday. dual sector spotlights in that vain. we'll be right back. >>> you're watching cnbc "squawk on the street" life from the large e.r.est financial capital of the year. >> we're back. the white house is going to drop the idea of giving the americans the option of government-run insurance as part of the new health car

all in all, the shanghai market closed up 1.7%. a couple of reasons here, and i did plenty of phone calls to try to make sense because the same mainland banks that closed up in shanghai actually closed down in hong kong trade. first of all, it seems like there seems to be a lot of optimism that before china celebrates a 60th national anniversary on october 1st, that somehow the regulators are going to step in and stabilize the theme just as carl as you probably noticed kind of the olympic event that you cover. and also, another thing, npos certainly doesn't seem to be a problem for the banks and also bank earnings so far has been coming in lined with expectations. and plus, you're getting plenty of assurances from the authorities that they do not want an abrupt halt to the kind of lending they saw that we've been seeing and also in the august figures apparently pretty much higher than july, but about a third of what we saw the record pace that we saw in june. so all in all, quite a peculiar picture. also, before i let you go, japan

. >>> here he is, show the shanghai sinker. turned into a surprise here. >> remember, strange linkage between oil and our market versus the chinese market. and i've been thinking about this. 15% of our market that's through a mineral, machinery. oil that's directly related to the drive of demand in china. if you can somehow delink oil from that equation, then you're starting to talk about 5% of the s&p directly related. when oil is up $3, it counteracts the major chinese trade. also even counteracts bizarre secondary trades like potash which should be down, there are important negotiations with china. it trades up as if its ethanol. it is a more complex linkage. >> then the simple china -- u.s. -- >> if oil had been down today, we might have been down a percent and a half. >> then i get to the issue, on one level, a very, very high level, going way up. that doesn't make sense. oil is above 70. that's bad for people. >> i have been pondering this over and over again. and it bothers me immensely because it counter intuitive. 85%

>> listen, you saw asia, the shanghai index just fall 10% like that. that's the kind of environment -- >> you talking a few days ago? >> within the last two weeks. they're 10% -- >> 5 in a single day and came back the next day. >> it came back a percent and went back down another 4.7%. down 10% overall in two weeks. that's the type of move that could happen once the rug gets pulled. >> how much was shanghai up in the previous 6 to 12 months. it doubled, right? >> that's where the growth is. we're more of a mature economy. >> more than doubled. a lot of the chinese stimulus money went straight in the stock market. >> you're still gettinging way ahead. but what happened was, anyone that bought that market on those highs -- >> go ahead, john. >> but dennis, almost half of the government stimulus money in china went straight in the stock market. that's not very healthy. >> it's been pretty healthy for investors over there. go ahead. >> what i'm thinking if we do continue and you're right with a great recovery, you still need to be prudent on your entries.