:00:31. > :00:44.Samsung warns of falling profit as smartphone sales slide. Welcome. I
:00:45. > :00:48.am Sally undocked. Also in the programme will look at the jobs
:00:49. > :00:52.crisis that is deepening in France. But first it is shaping up to be one
:00:53. > :00:57.of the biggest scandals that has rocked the world of football.
:00:58. > :01:03.Tickets intended for and officials being illegally resold for vast
:01:04. > :01:07.profits. Late Monday the chief executive of Match Hospitality, the
:01:08. > :01:12.firm in charge of selling World Cup ticket packages, was arrested by
:01:13. > :01:16.Brazilian police. That follows the 11 arrests last week and police say
:01:17. > :01:24.more arrests could follow. The nephew of FIFAposmack chairman is
:01:25. > :01:29.being investigated. Matchboxes are being charged with illegal ticket
:01:30. > :01:36.touting and conspiracy. They could face up to four years in prison. Our
:01:37. > :01:44.correspondence has the details. British national Ray Whelan being
:01:45. > :01:50.unceremoniously detained Rio de Janeiro's Copacabana Palace Hotel.
:01:51. > :01:54.The city's most prominent address where top officials of FIFA are
:01:55. > :01:59.staying for the World Cup. He is a senior executive in one of FIFA's
:02:00. > :02:04.official business partners. He is being questioned over his links to a
:02:05. > :02:09.gang running a World Cup ticket scam. They are thought to have been
:02:10. > :02:13.operating for the last four World Cups, obtaining and selling as many
:02:14. > :02:18.as 1000 tickets per match. Prosecutors said they could have
:02:19. > :02:23.made as much of $90 million this tournament alone. For several days,
:02:24. > :02:29.Brazilian police insisted someone from close to or inside FIFA must
:02:30. > :02:35.have been involved. Because of the number of VIP and hospitality
:02:36. > :02:41.tickets being made available. TRANSLATION: The crimes are the
:02:42. > :02:46.distribution of tickets to be sold by touts. It has a penalty of four
:02:47. > :02:53.years in prison. And criminal association. FIFA has insisted its
:02:54. > :02:58.high`tech name the ticketing policy makes swapping all reselling almost
:02:59. > :03:02.impossible. But as the tournament nears its climax, the demand for
:03:03. > :03:10.blackmarket tickets and the opportunity for criminal gangs to
:03:11. > :03:15.make vast profits is huge. Samsung says profits shrank by one
:03:16. > :03:20.quarter in recent months. Sales of smartphones fell in the three months
:03:21. > :03:26.to the end of June. Ricoh he is on is in Singapore, lovely to have you
:03:27. > :03:33.back. Tell us about Samsung. This is not good news.
:03:34. > :03:39.Absolutely. It is facing three key problems. Sales are impacted by the
:03:40. > :03:41.proliferation of cheaper Chinese smart phones. And the South Korean
:03:42. > :04:33.currency has been strong against volume and low margin handsets. The
:04:34. > :04:37.Chinese are making major inroads. Investors don't seem to be worried
:04:38. > :04:48.because Samsung's stock price is up slightly as the company cautiously
:04:49. > :04:53.expects a more positive outlet in `` outlook.
:04:54. > :05:01.In France there is a crisis summit on jobs. The number of people out of
:05:02. > :05:06.work is 3.4 million, a record high. The President is urging union bosses
:05:07. > :05:11.to meet him to reach an agreement on cuts in conditions. The union wants
:05:12. > :05:17.guarantees that business tax cuts will be used to create 500,000 new
:05:18. > :05:24.jobs. I am joined by the head of strategy at the bank CIBC. Tell us
:05:25. > :05:32.about the stalemate. This is not a good thing because France is seen as
:05:33. > :05:37.an uncompetitive economy because of the strict labour laws? Absolutely.
:05:38. > :05:43.Going back to the turn of the century the Germans were in a
:05:44. > :05:46.similar situation. A number of changes to improve productivity,
:05:47. > :05:56.lower labour costs and that allowed them to create their economy and
:05:57. > :06:01.drive employment. The French labour market still regulated highly. The
:06:02. > :06:06.government is trying to ease the restrictions. Talking about tax
:06:07. > :06:10.credits in order to allow and encourage employers to add something
:06:11. > :06:16.like 500,000 jobs. The question is whether the cuts can be
:06:17. > :06:21.implemented. The difficulty, if trade unions are not willing to be
:06:22. > :06:26.involved in the conversation then it is hard to move forward? It is. That
:06:27. > :06:31.is where the stalemate comes in. The trade unions want to say they want
:06:32. > :06:37.to make sure employment responsibilities are maintained. The
:06:38. > :06:42.stalemate, the employers will not take on extra work if they feel it
:06:43. > :06:46.is difficult to fire the workers if times become hard. That becomes the
:06:47. > :06:50.inherent stalemate. The French government needs to break the logjam
:06:51. > :06:57.because they need to encourage more employment to bring down the
:06:58. > :07:02.problem. The President came into power saying he would definitely
:07:03. > :07:06.increase growth in the French economy. He has got a socialist
:07:07. > :07:12.background and I would imagine the labour unions would feel he is more
:07:13. > :07:18.of an ear to them as opposed to eight Nicolas Sarkozy government,
:07:19. > :07:23.for example. You would imagine the unions were hopeful that when he
:07:24. > :07:27.came to power there would be a policy plan encouraging the them. He
:07:28. > :07:37.needs to break the logjam, he needs to go against his political
:07:38. > :07:40.orthodoxy. You need to deal with these restrictions in the first
:07:41. > :07:46.instance and that is a difficult scenario to break through. Thank you
:07:47. > :07:51.for your perspective. We are keeping an eye on how things go in France.
:07:52. > :07:56.Another story that involves France, more travel disruption and head for
:07:57. > :08:02.anyone hoping to use the Eurostar or shuttle services today. The 50
:08:03. > :08:08.kilometre tunnel will partly reopen today at a number of services have
:08:09. > :08:11.been cancelled. Eurotunnel says it is working to repair problems with
:08:12. > :08:17.overhead cables that caused the breakdown of a train on Monday,
:08:18. > :08:21.stranding dozens of passengers. If you are travelling on the tunnel
:08:22. > :08:28.check before you set off. The Vatican bank gives its annual
:08:29. > :08:33.performance report on Tuesday. It is under investigation for a number of
:08:34. > :08:37.scandals. The Church is expected to announce sweeping reforms, closing
:08:38. > :08:44.the investment arm and turning it into a much smaller institution. A
:08:45. > :08:53.French businessman is expected to be appointed as the new chief.
:08:54. > :08:57.Global markets are starting to get a little worried about when interest
:08:58. > :09:02.rates in the US will start to go up. Since the latest jobs news was
:09:03. > :09:06.released there is concern rates might go up. What will the new
:09:07. > :09:15.earnings season tell us about the health of the economy in the US?
:09:16. > :09:20.The balls are back on Wall Street. US stocks are at record highs and
:09:21. > :09:24.investors are optimistic. The next test is the second quarter
:09:25. > :09:28.earnings, when companies report profits and revenue. Strong
:09:29. > :09:34.corporate numbers could push stocks even higher. Can America's chief
:09:35. > :09:38.executives satisfy Wall Street? I think the earnings were going to
:09:39. > :09:50.ramp up in the third and fourth quarter. Earnings for the S 500
:09:51. > :09:56.index are expected to rise by 4.9% in the second quarter. Cutting costs
:09:57. > :10:00.is one way companies have been able to maintain profit margins.
:10:01. > :10:06.Improvements in Europe are also thought to have lifted. For others,
:10:07. > :10:17.a rise in the dollar has been a hindrance. As those here who have
:10:18. > :10:22.witnessed it, the Dow and the S 500 have lifted. Strong corporate
:10:23. > :10:28.earnings could reinforce this. But there is a danger that if they
:10:29. > :10:33.failed to live up to expectation, optimism of investors could be
:10:34. > :10:39.dashed. It is a busy day ahead. Alcoa
:10:40. > :10:46.earnings and also German trade figures, UK industrial figures as
:10:47. > :10:51.well. In terms of how things are going in Asia, the markets have
:10:52. > :10:56.dropped a little. We have a stronger yen today versus the US dollar. That
:10:57. > :11:01.is because of concern US interest rates could go up sooner than we
:11:02. > :11:04.might like. That is to close in the United States.
:11:05. > :11:17.That is all from World Business Report, I will see you soon.
:11:18. > :11:25.Many thanks to Sally for that. We will look at the papers in a moment
:11:26. > :11:31.but first, a committee of MPs is calling for a public enquiry for the
:11:32. > :11:40.safety of offshore helicopter flights. A creeping complacency may
:11:41. > :11:42.be affecting safety standards. Our