:00:00. > :00:15.Now for the latest financial news with World Business Report.
:00:16. > :00:21.Abenomics is dealt a severe blow as the Japanese economy contracts more
:00:22. > :00:27.The bosses of Europe's biggest steelmakers go
:00:28. > :00:37.to Brussels to demand urgent action to save its steel industry.
:00:38. > :00:44.Also in the programme, China's stock markets start trading after
:00:45. > :00:55.Japan's economy contracted in the final three months of 2015, adding
:00:56. > :00:59.to a string of setbacks for the government's economic reform policy.
:01:00. > :01:01.Weaker domestic demand was the biggest factor pulling down the
:01:02. > :01:06.economy, then add to that slumping exports and a stronger Japanese yen.
:01:07. > :01:10.Between October and December, official figures show it shrank
:01:11. > :01:18.This is worse than expected - most predicted
:01:19. > :01:24.The news highlights the challenges facing Prime Minister
:01:25. > :01:26.Shinzo Abe in attempting to drag the world's third-biggest economy
:01:27. > :01:32.Many are now saying three years of so-called
:01:33. > :01:40.at the School of Management and Information
:01:41. > :01:56.Nice to see you. Give us your reaction to the situation in Japan.
:01:57. > :02:08.It seems to be getting worse. The short-term negativity is expected,
:02:09. > :02:12.but the problem is people aren't spending because wages are not
:02:13. > :02:16.rising. It is not rising because capital expenditure is not going as
:02:17. > :02:21.well as expected. Corporate activities have not gone as strongly
:02:22. > :02:26.as excited. We saw 1.4% both on capital expenditure, but the
:02:27. > :02:31.Japanese corporate earnings for that period really stood out very
:02:32. > :02:36.quickly. There is a lot of murkiness ahead of us, leading to them not
:02:37. > :02:42.spending as much as expected. Why are big companies in Japan not
:02:43. > :02:46.investing or not increasing wages? A lot of them are sitting on cash at
:02:47. > :02:53.the moment. They have a lot of cash. Why are they not spending it? They
:02:54. > :02:58.have enough cash, with 225 trillion dollars, but why aren't they using
:02:59. > :03:03.it? Firstly because of their nature. Conservative nurse, but moreover,
:03:04. > :03:13.they are concerned about what is going on externally. They can see
:03:14. > :03:16.the slowdown creeping up on a lot of nations, and with the Japanese
:03:17. > :03:23.exports being poised to take the heavily in the economy, these
:03:24. > :03:28.players who sing down their capital expenditure are not investing. We're
:03:29. > :03:31.not getting a good kickstart from these Japanese exporters, and they
:03:32. > :03:34.are very cautious because they can see what is going on externally.
:03:35. > :03:41.Give us your take on this take on whether Abenomics is working or not.
:03:42. > :03:47.This is the three point policy of Shinzo Abe and his team, all about
:03:48. > :03:52.money supply, then increasing government spending, and then trying
:03:53. > :03:58.to reform the structure of the Japanese economy. Is this a sign it
:03:59. > :04:04.is not working or do we need more time for you to kick in? To see a
:04:05. > :04:09.third arrow, the trajectory is much longer than the first two, so we
:04:10. > :04:13.have to wait and see. But the first two certainly not looking as
:04:14. > :04:20.attractive, because his first game is to get them spending on capital
:04:21. > :04:24.expenditure, and that is not happening. That is probably one of
:04:25. > :04:29.the biggest problems in Japan right now. Thank you.
:04:30. > :04:32.Well, despite the bad news about the Japanese economy, share markets
:04:33. > :04:40.The Nikkei 225 was up over 5% earlier.
:04:41. > :04:43.Also China's stock markets have opened for the first time after
:04:44. > :05:00.Nice to see you. It is another manic Monday it would seem. Tell us what
:05:01. > :05:05.is going on. It was a manic Monday early in a Beijing trade and
:05:06. > :05:09.Shenzhen trade, and unfortunately we are seeing some of those losses in
:05:10. > :05:14.Chinese stocks being reduced. It is not as bad as what many investors
:05:15. > :05:18.thought would be. Flashback to last week, Japan plunging around 12%. The
:05:19. > :05:23.sentiment was that mainland stocks would play catch up after this
:05:24. > :05:28.Chinese New Year break. Fortunately, that has not happened. Chinese
:05:29. > :05:35.stocks are down -- unfortunately. They only closed about 1%. Better
:05:36. > :05:40.than expected sales numbers during the holiday season, tough talk from
:05:41. > :05:44.the central bank governor against speculators, and a firm exchange
:05:45. > :05:48.rate. Beijing released figures earlier today showing imports and
:05:49. > :05:53.exports both falling more sharply than expected in January, impaired
:05:54. > :05:55.with a year earlier. But it seems domestic investors at this point are
:05:56. > :06:02.shrugging off Mike this disappointing trade numbers for now.
:06:03. > :06:07.When you talk to dealers, the impact was mainly driven by falling
:06:08. > :06:14.commodity prices and concerns about the impact on Europe. When you look
:06:15. > :06:20.at the over Marco, it has been brittle with the Shanghai and
:06:21. > :06:24.Shenzhen losing about 20% so far this year, and that is about 1.8
:06:25. > :06:31.Chilean dollars in market value lost so far -- look at the overall
:06:32. > :06:33.market. Ouch. We will see you soon. That is the scene in Asia today.
:06:34. > :06:36.Let's focus on Europe. Steel is back on the agenda today
:06:37. > :06:39.as bosses of some of Europe's biggest steelmakers are in Brussels
:06:40. > :06:41.demanding urgent action to support They will march to the
:06:42. > :06:45.European Commission buildings where industry chiefs and unions will meet
:06:46. > :06:47.with senior commissioners, including the European vice-president, who is
:06:48. > :06:52.responsible for jobs and growth. The EU is
:06:53. > :06:54.the second-largest producer of steel in the world after China, which has
:06:55. > :06:57.been accused of flooding the Last Friday, the European Commission
:06:58. > :07:04.opened anti-dumping investigations Tanya Beckett explains what all
:07:05. > :07:22.the fuss is about. The price of steel has fallen
:07:23. > :07:29.dramatically in the past five years. The steel industry is
:07:30. > :07:33.dominated by China, accounting for almost half of global production.
:07:34. > :07:38.They produced nearly 900 million metric tons last year. But as growth
:07:39. > :07:44.in China's economy slows, it has been sending more steel abroad. It
:07:45. > :07:51.steel exports have surged 51%, whereas Japan and the EU have seen
:07:52. > :07:54.marginal changes. The European steel Association says more than five
:07:55. > :08:01.dozen jobs have been lost across Europe in recent months. With the UK
:08:02. > :08:05.particularly affected. Companies like Tata Steel and Redcar blame
:08:06. > :08:11.high electricity prices and cheap steel from China. With more jobs on
:08:12. > :08:15.the line, the EU took action in January and said provisional duties
:08:16. > :08:22.on Chinese imports of between 9.2 and 13%. But many say these measures
:08:23. > :08:27.don't go far enough. The steel industry employs 328,000 people in
:08:28. > :08:29.Europe, and thousands of these jobs are at risk from cheap Chinese
:08:30. > :08:32.imports. UK banking giant HSBC has announced
:08:33. > :08:35.it is to keep its headquarters Concerns about stricter UK
:08:36. > :08:40.regulations led Europe's biggest bank to launch a review into whether
:08:41. > :08:43.to move elsewhere, with Hong Kong But the bank said it had decided
:08:44. > :08:49.unanimously against the move and that London
:08:50. > :08:51."offered the best outcome for our We will discuss that in more detail
:08:52. > :09:05.in a few minutes. Toyota says it has resumed
:09:06. > :09:08.operations at all vehicle assembly and parts plants in Japan
:09:09. > :09:10.after its longest domestic production suspension since the
:09:11. > :09:12.March 2011 earthquake and tsunami. The world's top auto-maker said
:09:13. > :09:15.earlier this month that it would temporarily stop all domestic
:09:16. > :09:17.vehicle production from February 8 through 13 due to a components
:09:18. > :09:40.shortage following an explosion at Let's show you the numbers. The
:09:41. > :09:44.mayhem in Asia at the moment. We have 20 minutes of trade to go in
:09:45. > :09:49.Tokyo, and look at that. Over 7% at the moment. The Hong Kong up over
:09:50. > :09:54.3%. The price of oil going down. Let's look at the currency markets.
:09:55. > :10:01.The yen has weakened a little bit, helping those markets in Japan,
:10:02. > :10:06.which has been ignoring that news about its economy shrinking. We will
:10:07. > :10:09.review the papers in a few minutes, so stay with us.