:00:00. > :00:00.Those are the latest headlines from BBC News. Now for the latest
:00:00. > :00:16.financial news with Sally Bundock and World Business Report.
:00:17. > :00:24.Hundreds more flights are cancelled, as pilots strike again at Lufthansa.
:00:25. > :00:29.Will the German carrier be able to bear the cost? And what is known as
:00:30. > :00:31.the summer Davos gets under way in Tianjin, northern China, where
:00:32. > :00:40.thousands of business and economic leaders are gathered. Welcome to
:00:41. > :00:49.World Business Report. I'm Sally Bundock. Also in the programme, we
:00:50. > :00:54.will have the market reaction to that big event in California, of
:00:55. > :00:57.course, the Apple launch of new products. We will look at that. But
:00:58. > :01:00.first: Pilots at Lufthansa will hold an eight`hour strike at Munich
:01:01. > :01:03.airport today ` the third strike by the German airline's pilots within
:01:04. > :01:05.two weeks. Lufthansa said about 110 flights will have to be cancelled,
:01:06. > :01:08.affecting about 13,500 passengers. This fresh round of strike action
:01:09. > :01:11.has left the airline counting the costs ` the previous strike, last
:01:12. > :01:24.week, affected 25,000 passengers, and wiped millions of euros off its
:01:25. > :01:30.profits. With me is Ben Kumar, analyst with Seven Investment
:01:31. > :01:35.Management. It sounds like the pilots are being fairly effect. Last
:01:36. > :01:39.week lots of passengers had to be put up in hotels, costing the
:01:40. > :01:45.airline lost of money `` lots of money, lots of disruption. Your
:01:46. > :01:49.thoughts? This is expected to cost around 5 million euros today, the
:01:50. > :01:53.one last week cost tens of millions of euros, and a three`day one in
:01:54. > :01:59.April wiped about 60 million euros of profit the airline. It is true to
:02:00. > :02:04.say that this strike is having an impact. From the point of view of
:02:05. > :02:09.Lufthansa, what is it doing about this? They do say they are in talks
:02:10. > :02:14.with unions, but clearly at the moment they are not making any
:02:15. > :02:17.headway. Interestingly, one of the Lufthansa representative said they
:02:18. > :02:20.are not really negotiating at the moment, what they are doing is
:02:21. > :02:24.trying to sort out the passengers who will be left stranded. So
:02:25. > :02:29.clearly they are not really at the meeting table to talk about what the
:02:30. > :02:34.unions want. What they are trying to do is to resolve the situation, and
:02:35. > :02:38.wait until it goes away. This is all about the early retirement plan for
:02:39. > :02:43.pilots at Lufthansa, what do the two sides want? The current situation at
:02:44. > :02:47.Lufthansa is that the pilot can take early retirement at 55 on 60% of his
:02:48. > :02:52.salary, recently the European Commission increased the age pilots
:02:53. > :02:57.can work until to the age of 65, however this early retirement age
:02:58. > :03:01.did not go up. The unions are saying they would like to remain at 55, but
:03:02. > :03:07.Lufthansa saying that this is unfair, the gap is now wider than it
:03:08. > :03:11.was, and we can't take the equivalent of paying 60% salaries
:03:12. > :03:16.year after year after year after year, and we think the early
:03:17. > :03:22.retirement age should rise. Briefly, can Lufthansa bear the cost of this?
:03:23. > :03:26.It seems to be able to. Its profits this year are estimated at about 1
:03:27. > :03:32.billion euros. Its share price fell from about 20 in April to about 13.5
:03:33. > :03:38.billion euros today. It seems to be holding up fairly well, and it seems
:03:39. > :03:44.like it could go all the way. Disruption at Frankfurt and other
:03:45. > :03:48.airports. Apple has unveiled its first new product since the iPad
:03:49. > :03:51.four years ago. The Apple Watch is a smart watch which runs apps, acts as
:03:52. > :03:54.a health and fitness tracker, and communicates with the iPhone. The
:03:55. > :03:56.technology giant also unveiled two larger iPhones. Our technology
:03:57. > :04:02.correspondent, Rory Cellan`Jones was at the launch in California. An
:04:03. > :04:05.Apple event is never knowingly underhyped, but this time, the
:04:06. > :04:08.presence of figures from the fashion world and the likes of Rupert
:04:09. > :04:12.Murdoch showed the company was setting out to prove it could
:04:13. > :04:16.conquer new territory. This man, Tim Cook, has been in the shadow of
:04:17. > :04:21.Steve Jobs, with whispers that Apple could no longer innovate after the
:04:22. > :04:29.death of its founder. Today, we have some amazing products to share with
:04:30. > :04:36.you. But he believes this is the answer to the critics. A watch, the
:04:37. > :04:39.Apple Watch. Greeted with near hysteria by some in the audience,
:04:40. > :04:43.the device is designed to bring some of the functions of the phone to the
:04:44. > :04:48.wrist, while monitoring your daily activity. It is beautifully
:04:49. > :04:52.designed, like every Apple product, and as well as telling the time,
:04:53. > :04:55.Apple says it can do all kinds of things, like monitor your health and
:04:56. > :04:59.fitness and allow you to check in with an airline or get into a hotel
:05:00. > :05:03.room. But the big question is, just how big a demand is there for you to
:05:04. > :05:09.run your world from your wrist? Apple is late to this market. Others
:05:10. > :05:11.have already launched a whole host of smartwatches and fitness bands,
:05:12. > :05:14.without so far convincing a sceptical public that wearable
:05:15. > :05:17.gadgets are the future. Wearables is a huge area, and you've already seen
:05:18. > :05:19.that with Android, with other manufactures getting on. The
:05:20. > :05:23.reception so far has been quite lukewarm. Whether Apple have the
:05:24. > :05:27.magic, as they always claim they have, to convince us ` they've done
:05:28. > :05:31.it before with the iPad, they did it with the iPhone. Is it going to be
:05:32. > :05:35.third time lucky? And we call it Apple Pay. Tim Cook also unveiled
:05:36. > :05:38.something which could be much more lucrative than a watch. A system
:05:39. > :05:42.called Apple Pay, to allow easy payment by phone or watch in a shop
:05:43. > :05:44.or online. But the timing of this event, just after dozens of
:05:45. > :05:47.celebrities saw their private photos hacked from Apple's iCloud, raises
:05:48. > :05:56.questions about how much trust consumers still have in the company.
:05:57. > :06:00.It is the iPhone, now coming in two bigger models, which still powers
:06:01. > :06:14.Apple's profits. Don't expect the watch, when it goes on sale next
:06:15. > :06:20.year, to change that in a hurry. And an interesting factoid for you: When
:06:21. > :06:23.the original Apple phone debuted, Apple shares went up 8% on the day.
:06:24. > :06:26.But since then the market reaction to the annual unveiling has been
:06:27. > :06:30.mostly negative. In the last six years Apple stock has ended the day
:06:31. > :06:32.down five times on the days of presentations. This is largely
:06:33. > :06:36.because it has struggled to keep its new products under wraps, and by the
:06:37. > :06:39.time the event rolls around, the stock price has already factored in
:06:40. > :06:41.some of the news. Yesterday was no different. During Tim Cooks
:06:42. > :06:57.presentation the shares climbed, but then fell 1% to close at $97.99.
:06:58. > :07:00.Let's turn our attention to the city of Tianjin in China, which is
:07:01. > :07:03.hosting the 2014 Summer Davos Forum. Thousands of business and government
:07:04. > :07:06.leaders from around the world will be attending the forum, whose theme
:07:07. > :07:09.this year is "Creating Value Through Innovation" The city is in the
:07:10. > :07:12.spotlight not only for hosting the three`day event, but also the key
:07:13. > :07:15.role it is expected to play in China's economic future. It is home
:07:16. > :07:17.to more than 150 Fortune 500 companies, and the maritime
:07:18. > :07:33.transport gateway for Beijing. And our very own Linda Yueh is there for
:07:34. > :07:37.us. Are the great expectations `` are their great expect patients for
:07:38. > :07:40.the event this year? I think the expect patients are whether or not
:07:41. > :07:44.we will hear that China can innovate. As you have said, it is
:07:45. > :07:48.the big theme of the conference and is likely to be the theme of the
:07:49. > :07:54.Chinese Premier's speech later on today. He is expected to say why it
:07:55. > :07:59.is that structural reforms like promoting innovation, encouraging
:08:00. > :08:02.Chinese firms to go global, those are the reasons why the rest of the
:08:03. > :08:05.world, and business leaders, it should give China sometime to make
:08:06. > :08:11.those adjustments. And that could help explain away a slowing economy,
:08:12. > :08:16.which I the IMF's projections, will miss the Chinese government's growth
:08:17. > :08:20.target this year. That gives you the larger context as to why the
:08:21. > :08:23.Premier's speech, which is always closely watched, is probably going
:08:24. > :08:29.to be more closely watched this time. Will he bring the confidence
:08:30. > :08:33.that he wants to? As you say, there is a lot of questions about China in
:08:34. > :08:38.the future, and today the Chinese markets are lower. Hong Kong is
:08:39. > :08:43.having a really tough day because of worries about growth in China.
:08:44. > :08:47.Absolutely right. One of the key data points which has caused a bit
:08:48. > :08:52.of worry is that loan growth, new loans being issued in China, are
:08:53. > :08:57.actually pretty low. That has always been seen as a reliable indicator,
:08:58. > :09:01.as opposed to some of the macro data. One announcement I think will
:09:02. > :09:05.be processed by the markets to date is that the Chinese have announced
:09:06. > :09:09.easier rules for Chinese companies to invest overseas, and by doing
:09:10. > :09:13.that, they could allow the private firms the innovative firms, to go
:09:14. > :09:18.into overseas markets and can be there, now that always seemed very
:09:19. > :09:21.unusual to the rest of us. Mostly in the market economies, where
:09:22. > :09:26.companies can move into markets when they have good enough stuff, but
:09:27. > :09:30.that is not the case for China. So that I am pretty sure is one to
:09:31. > :09:36.watch. I will certainly be watching that all day here in Tianjin, but
:09:37. > :09:41.for now, act to you. We will speak to Linda again, as she is there
:09:42. > :09:46.throughout the event. To the markets, Hong Kong is down nearly
:09:47. > :09:50.2%. We have mentioned the issues of Chinese growth. A quick look at the
:09:51. > :09:55.close in the US. Another poor day there as well. I will see you soon
:09:56. > :10:03.as we talk through the papers. Stay with us. A new report says it often
:10:04. > :10:06.costs people with dementia and their families more than ?20,000 a year to
:10:07. > :10:09.look after their needs. This includes payments for help with
:10:10. > :10:12.tasks such as washing and dressing, and unpaid care from family and
:10:13. > :10:14.friends. The charity behind the research, the Alzheimer's Society,
:10:15. > :10:16.says those involved are effectively paying a dementia tax. Our health
:10:17. > :10:17.correspondent Adam Brimelow