:00:06. > :00:16.who are unbeaten in 21 games. Now for the latest financial news with
:00:16. > :00:28.
:00:28. > :00:31.World Business Report. Spain's Prime Minister calls the 100
:00:31. > :00:38.billion euro bail-out of its banks a victory. But many ask, is this
:00:38. > :00:46.another rescue of a flagging economy through the back door?
:00:46. > :00:49.Asian markets are two reacting positively to the rescue package.
:00:49. > :00:51.Plus Europe's airlines will make a combined loss of over a billion
:00:51. > :01:01.dollars this year, warns the International Air Transport
:01:01. > :01:05.
:01:06. > :01:08.Association. The euro has strengthened and share markets in
:01:08. > :01:12.Asia are rallying today following the agreement reached between the
:01:12. > :01:15.Spanish government and the EU on the rescue of its banks. Over the
:01:15. > :01:19.weekend eurozone ministers agreed to lend Madrid up to 100 billion
:01:19. > :01:22.euro's - or $125 billion - to help its debt-stricken lenders. Spain
:01:22. > :01:32.has now become the fourth eurozone economy to seek an international
:01:32. > :01:32.
:01:32. > :01:34.bail-out. But the agreed EU loans for the banks is solely for their
:01:34. > :01:37.recapitalisation and therefore Spain avoids the inspection of
:01:37. > :01:39.government books that came with bail-outs of other economies such
:01:39. > :01:44.as Greece. Still the European Commission is expected to impose
:01:44. > :01:46.tough new measures on the overhaul of Spain's financial sector.
:01:46. > :01:55.Spanish Prime Minister Mariano Rajoy hailed the decision as a
:01:55. > :02:02.victory for the single currency. The TRANSLATION: Yesterday be
:02:02. > :02:12.credibility of the euro and the future of the euro and the solidity
:02:12. > :02:13.
:02:13. > :02:17.of the financial sector won the day. Asian investors so far see this as
:02:17. > :02:23.a step in the right direction. The share markets are heading higher
:02:23. > :02:28.today. Absolutely. We are getting a thumbs
:02:28. > :02:38.up from Asian investors. But some traders think it could be short-
:02:38. > :02:42.
:02:42. > :02:52.lived. Shias, commodities nb 8 are rising in my day training. -- and
:02:52. > :02:52.
:02:52. > :02:58.the euro currency. US stock futures are up more than 1% at the moment.
:02:58. > :03:03.Some traders are spectacle, saying that any boost today could be
:03:03. > :03:09.short-lived unless Europe comes forward quickly with more bold
:03:09. > :03:16.action to a Shure the international community that it has a grip on its
:03:16. > :03:22.debt crisis. If the result does not go the euros and's way, this could
:03:22. > :03:30.depress the Asian markets again. More policy easing to support a
:03:31. > :03:39.slowing economy in China is also adding to the positive out Grocke.
:03:39. > :03:45.The euro is strengthening against the dollar and the yen. Its highest
:03:45. > :03:55.level since 23rd May. In commodities, oil prices are getting
:03:55. > :03:55.
:03:55. > :04:02.a lift. More than $2 per barrel. Hopefully this good news will
:04:02. > :04:09.continue. That is how the markets have
:04:09. > :04:15.reacted, but to what extent has the rescue of Spanish banks really
:04:15. > :04:21.fixed beat eurozone debt crisis? The bail-out is larger than many
:04:21. > :04:29.expected it to be. Does it really fix the problem? It fixes this
:04:29. > :04:33.particular symptom, of the Spanish debt. If you look at the sums
:04:33. > :04:39.involved, we are dealing with property. Although they wrote the
:04:39. > :04:46.value down, the value of property were still dropping. Good for
:04:46. > :04:51.confidence, as reflected in the markets. But remember sorting be
:04:51. > :04:57.euro issue out is a larger issue, making sure you have the fiscal
:04:57. > :05:01.discipline in place. In terms of the loans to builders
:05:02. > :05:08.and other elements in the Spanish economy, we is that going? Do we
:05:08. > :05:16.know yet? Are not yet. This is coming of the government's debt
:05:16. > :05:21.position, said this is 15% added. The central government has got it
:05:21. > :05:31.so that gives them extra pressure. We are not sure whether this is
:05:31. > :05:34.
:05:35. > :05:41.coming through the stability found - we will need further details..
:05:41. > :05:47.They will assess some other banks to find out what they situation is?
:05:48. > :05:53.This is primarily a domestic issue. Spain is nothing like Greece. The
:05:53. > :05:57.Spanish economy has its problems, but this was a bank loans problem.
:05:57. > :06:05.The Irish will be upset because they have had to go through a lot
:06:05. > :06:15.of the paint and the Spanish have very definitely dance their way in.
:06:15. > :06:17.
:06:17. > :06:20.We will be looking at the newspapers later. Europe's airlines
:06:20. > :06:22.will make a combined loss of $1.1 billion this year, warns the
:06:22. > :06:25.International Air Transport Association, IATA. That's double
:06:26. > :06:28.the scale of losses it forecast back in March. IATA says their
:06:29. > :06:31.passenger numbers are likely to be hit hard by the developing crisis
:06:31. > :06:34.in the Eurozone. But carriers elsewhere in the world could see
:06:34. > :06:44.profits pick up thanks to the recent fall in crude oil prices.
:06:44. > :06:44.
:06:44. > :06:51.Jeremy Howell reports. For the past year, with the price of Brent crude
:06:51. > :06:57.up to $120 per barrel, many airlines have plunged into loss.
:06:57. > :07:07.Although the price has fallen 20% since spring, I doubt it precedes
:07:07. > :07:08.
:07:08. > :07:18.the losses of European carriers will top $1 billion. -- i Out --
:07:18. > :07:19.
:07:19. > :07:24.Ita TA. France is undergoing a painful restructuring. Until the
:07:24. > :07:30.European economies pick up the airlines exposed to that economy
:07:30. > :07:38.will continue to find business tie- up. Airlines like Ryan near Hythe
:07:38. > :07:41.port dozens of their planes out of service duty subdued demand. But
:07:41. > :07:45.there is still cut throat competition for customers so
:07:45. > :07:52.airlines will be under pressure to bring down fears as fuel prices
:07:52. > :07:57.fall. It will play its way through because people are desperate to
:07:58. > :08:03.keep their cabins fall. If the import price goes down they will
:08:03. > :08:08.pass that on straight away. Airlines tend to buy their fuel and
:08:08. > :08:15.advance to hedge against rising prices. That means that most will
:08:15. > :08:20.have all they need for the rest of this year. They are by now for
:08:20. > :08:25.delivery at the start of next year, meaning they could be several
:08:25. > :08:29.months before lower costs and lower fares start to come through. The EU
:08:29. > :08:34.is always the possibility that crude or will prices could rise
:08:34. > :08:37.again. BBC News. China's export growth has increased while
:08:37. > :08:40.inflation has slowed. Last month exports jumped by just over 15%
:08:40. > :08:50.from a year earlier, beating expectations. In April they were up
:08:50. > :08:50.
:08:50. > :08:52.by 4.9%. But despite the surge in exports in May industrial output
:08:52. > :08:58.and retail sales figures were disappointing and explained China's
:08:58. > :09:01.surprise cut in interest rates last week in a move to boost growth.
:09:01. > :09:07.Spain's Telefonica has announced it will sell almost half of its stake
:09:07. > :09:10.in Hong Kong listed China Unicom for $1.4 billion. The buyer is
:09:10. > :09:12.China Unicom's parent company China United Network. The deal, which
:09:12. > :09:20.needs regulatory approval, is expected to close before the end of
:09:20. > :09:27.July and will reduce the debt of Spain's largest phone company. The
:09:27. > :09:33.markets in Asia have been rallying on the back of that larger-than-
:09:33. > :09:39.expected bail out of the Spanish banks. Investors in Asia are happy
:09:39. > :09:48.for now and we will see how long the sentiment last. In Europe, D
:09:48. > :09:54.DAX and be FTSE and the French markets could be up well over 1%.
:09:54. > :10:00.The euro has been gaining ground this is the Japanese yen and the US