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after he was found guilty of abduction. | :00:01. | :00:06. | |
Those are the latest headlines from BBC World news. Time for the money | :00:06. | :00:16. | |
:00:16. | :00:24. | ||
news and what business report. -- Turmoil on global markets as | :00:24. | :00:28. | |
investors face a world without the Federal Reserve stimulus. From | :00:28. | :00:33. | |
stocks to bonds to commodities, nothing is spared the sell-off. | :00:33. | :00:37. | |
It is a billion-dollar industry and growing fast, but will Brussels | :00:38. | :00:47. | |
:00:48. | :00:48. | ||
star that the boom in electronic A warm welcome to World Business | :00:48. | :00:53. | |
Report. Also coming up in the programme: Talks in Beijing as | :00:53. | :00:59. | |
Europe and China tried to head off a damaging trade war. | :00:59. | :01:02. | |
Financial markets around the world have been in turmoil as investors | :01:02. | :01:07. | |
come to terms with a new reality that the era of massive support | :01:07. | :01:11. | |
from the US Federal Reserve is coming to an end. For years the | :01:11. | :01:15. | |
board's most powerful central bank has been pumping billions of | :01:15. | :01:19. | |
dollars into the financial system, keeping borrowing costs at rock | :01:19. | :01:23. | |
bottom and pushing up the value of assets around the world. | :01:23. | :01:30. | |
Confirmation from the Chief of the Federal Reserve that he is going to | :01:30. | :01:33. | |
be winding down what we have been going quantitive easing it as the | :01:33. | :01:38. | |
US in Proops has sparked a global sell-off in those assets. Major | :01:38. | :01:44. | |
stock markets from Europe to India to South Africa also force of | :01:44. | :01:52. | |
between 3-4 %. The S&P 500 had its worst day since 2011. Gold, silver, | :01:52. | :01:58. | |
copper and oil also all plunged, as have bond prices. In just a moment | :01:58. | :02:02. | |
we will be going to Asia, where markets are stabilising a little | :02:02. | :02:08. | |
bit. But first this report from the New York Stock Exchange. | :02:08. | :02:11. | |
US markets have been reacting poorly to the news that the US | :02:11. | :02:16. | |
Federal Reserve may in fact start scaling back its stimulus programme | :02:16. | :02:22. | |
a little earlier than anticipated. Since we heard from the chief on - | :02:22. | :02:26. | |
the chief of the Fed, market in the US have been falling. On Thursday, | :02:26. | :02:32. | |
the S&P saw its worst day since 2011, dropping by 2.5%. The Dow | :02:32. | :02:37. | |
Jones also dropping by 2%. The markets have been craving clarity | :02:37. | :02:43. | |
from the chairman, wanting to know when it would start scaling back it | :02:43. | :02:47. | |
stimulus programme. Markets have heard what the chairman has to say | :02:47. | :02:51. | |
and they have not like it one bit. In speaking with traders on the | :02:51. | :02:54. | |
floor of the New York Stock Exchange, the sense is the sell-off | :02:54. | :02:59. | |
will in fact continue. We're just a few weeks away from the Fourth of | :02:59. | :03:04. | |
July holiday in the States, which is usually a slow period for market. | :03:04. | :03:08. | |
Unless we hear some positive economic data in the next few days, | :03:08. | :03:11. | |
the downward trend we are seeing is here to stay for the next little | :03:11. | :03:18. | |
while. Let go straight to our reporter in | :03:18. | :03:25. | |
a Singapore Bureau. How are things going in age at the moment? As you | :03:25. | :03:28. | |
mentioned there is some stability in Asian markets in midday trading, | :03:28. | :03:34. | |
but they are still at their lowest levels in almost ten months. Stocks, | :03:34. | :03:39. | |
currencies, commodities being sold. Investors continued to digest the | :03:39. | :03:48. | |
plan to scale back stimulus measures in the US. China's central | :03:48. | :03:53. | |
bank offered some comfort as it told major state banks to resume | :03:53. | :03:54. | |
told major state banks to resume supplying funds after tightening | :03:54. | :04:00. | |
liquidity on Thursday. This is a little bit of fresh air for many | :04:00. | :04:04. | |
investors who have been selling off their stocks over the past trading | :04:04. | :04:09. | |
days. Australia currently training earlier losses. South Korean shares | :04:09. | :04:14. | |
also curbing some of the losses also curbing some of the losses | :04:14. | :04:16. | |
after it losing 2.5% in early trading. And Kong and Shanghai and | :04:16. | :04:24. | |
shares are still down, but only by a few %. Japan's stock average, the | :04:24. | :04:30. | |
Nikkei 225 down by 2%. Now law by 1%. Analysts say stocks are | :04:30. | :04:35. | |
tumbling, but over the longer term, financial markets will regain | :04:35. | :04:39. | |
stability as the US economy regains sustainable growth. | :04:39. | :04:43. | |
The markets are still jittery. Let's talk about the smog. You and | :04:43. | :04:48. | |
I were talking about it yesterday. I can see from the window behind | :04:48. | :04:53. | |
you looks like it is getting worse. That leads on to the discussion | :04:53. | :04:59. | |
about the economic impact of it. Just to give you some background. | :04:59. | :05:06. | |
The smoggy is really bad. It has failed to new record highs. Now let | :05:06. | :05:12. | |
401, a very hazardous and unhealthy level. Singapore has never | :05:12. | :05:16. | |
experienced this kind of days. Even in the studio I still have to wear | :05:16. | :05:23. | |
my mask after this broadcast. One economist said that the tourism | :05:23. | :05:31. | |
industry, which makes up 5-6 % of GDP, will be hardest hit. The | :05:31. | :05:36. | |
initial impact will be over $400 million. Other analysts say if the | :05:36. | :05:38. | |
Government implement a stop work order, it will not only hurt | :05:38. | :05:43. | |
tourism but also the construction and manufacturing industries. The | :05:43. | :05:47. | |
economic cost could be in the range of $1 billion. | :05:47. | :05:57. | |
I think if you can his best to stay Let's have to Beijing, where | :05:57. | :06:01. | |
European Union leaders ended China's leaders will be trying to | :06:01. | :06:05. | |
defuse a simmering trade dispute at a meeting later today. The row over | :06:05. | :06:11. | |
China's solar panel exports is expected to be raised on the | :06:11. | :06:14. | |
sidelines of annual trade talks between the two countries. | :06:14. | :06:22. | |
Our correspondent has more. EU-China trade has mushroomed to | :06:22. | :06:26. | |
more than $1 billion per day. When the one hand, a triumph of co- | :06:26. | :06:29. | |
operation. The sheer volume of goods now flowing in both | :06:29. | :06:33. | |
directions means that on the other end the disagreements become more | :06:33. | :06:37. | |
acute. On the official agenda of the annual trade committee talks | :06:37. | :06:42. | |
being held here in Beijing are the usual for the subject. Market | :06:42. | :06:47. | |
access barriers and intellectual property protection for example. EU | :06:47. | :06:52. | |
officials say that another, more specific and explosive issue will | :06:52. | :06:58. | |
be discussed on the sidelines. The EU imposed tariffs on Chinese solar | :06:58. | :07:01. | |
panels exports earlier this month following a finding that they were | :07:01. | :07:09. | |
being dumped at artificially low prices. China has now launched an | :07:09. | :07:15. | |
investigation into the prices of European wine exports. Some | :07:15. | :07:18. | |
European big exporting countries are urging the EU trade | :07:18. | :07:23. | |
commissioner to find a negotiated settlement before the issue spirals | :07:23. | :07:31. | |
into a full-blown trade war. Let's move on to these. They are a | :07:31. | :07:35. | |
billion-dollar industry and they are growing fast. Their supporters | :07:35. | :07:39. | |
say they are a safer alternative to smoking. Electronics cigarettes you | :07:39. | :07:47. | |
a battery-powered device to turn nicotine based liquid into vapour. | :07:47. | :07:50. | |
They have divided regulators and anti-smoking activists. There is a | :07:50. | :07:54. | |
debate on their health. Today EU health ministers will discuss | :07:54. | :07:59. | |
proposals that could see some electronics regret we classified as | :08:00. | :08:02. | |
medicinal products and that would subject them to extensive health | :08:02. | :08:06. | |
testing and in some countries require that they be sold only in | :08:07. | :08:12. | |
pharmacies. Catherine Devlin is from the trade association. She | :08:12. | :08:18. | |
drew to be now from the Welsh capital, Cardiff. Are you worried | :08:18. | :08:24. | |
about the outcome of these talks? Actually, No. Oddly I am | :08:24. | :08:30. | |
increasingly confident because the MEPs and council members are | :08:30. | :08:35. | |
actually in forming themselves of the facts of this issue. As they do | :08:35. | :08:39. | |
that more and more, they can only reach the right conclusions, which | :08:39. | :08:44. | |
is that electronic cigarettes can never be Medicinal Products. He | :08:44. | :08:46. | |
would have to break them and redesign them to turn them into | :08:47. | :08:50. | |
medicines. I am confident that we will end up with sensible | :08:50. | :08:55. | |
proportion of reclamation -- proportional regulation that works | :08:55. | :09:00. | |
to make sure everything is safe. Also, almost more importantly, we | :09:00. | :09:02. | |
will keep them in the hands of smokers that have made the switch | :09:03. | :09:07. | |
and want and need them. You say that there is no chance that | :09:07. | :09:11. | |
electronics cigarettes will be classified as medicinal instruments, | :09:11. | :09:14. | |
and yet you stand by the claim that they are vastly healthier than | :09:14. | :09:20. | |
normal cigarettes? Absolutely. It does seem a bit incongruous, but | :09:20. | :09:24. | |
the fact is that if you wanted to turn an electronic cigarette into a | :09:24. | :09:27. | |
medicine, it could no longer be an electronics cigarette as they are | :09:27. | :09:31. | |
currently working. Millions of smokers around the world have made | :09:31. | :09:35. | |
the switch and are now no longer smoking tobacco, but are instead | :09:35. | :09:39. | |
using electronic cigarettes. That has to be good for public health. | :09:39. | :09:43. | |
The unfortunate thing about the netizens programme is that it would | :09:43. | :09:48. | |
require delivery of controlled dosages and that is not what | :09:48. | :09:51. | |
smokers are looking for. That is not what they get from the | :09:51. | :09:57. |