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tv   Squawk on the Street  CNBC  January 13, 2015 9:00am-11:01am EST

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check it out. in tulsa arguesactualtulsa, a water main break like no other. enough portion to bring down the awning over a gas station. luckily no one was injured. >> luckily we're out of here too. make sure you join us tomorrow. right now it's time for "squawk on the street". ♪ congratulations to the ohio state become eyes. urban meyer. on their national championship last night. what a game last night. i'm carl quintanilla with jim cramer david faber. got some between numbers. csx reports tonight. oil crummy as usual. got down to 44 1/2 almost.
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ten year right around 1.9. china trade was amiss and uk inflation at a 14 year low. stocks pointing higher as earnings begin to roll out. different story for oil fall to go merely a six year low as opec says it will not change its drought put strategy. >> and speaking of earning, alcoa did top expectations. what the ceo has to say about their fourth quarter results. >> plus why credit suisse thinks iphone sales could drift stock to 130. but stocks look to end a two session losing streak. oil back down below $45. oil minister defending opec's decision into the tonot to reduce output. brent around 45 as well. it was said it's not about whether the price hike will come, it's about more the timing. >> all i can tell you is that other countries and other continents are starting to react
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positively. getting better feel from china. europe we're hearing better things because of the oil tee decline. india we're starting to get a good read. the calvary is beginning to come from this low oil whereas we have obviously we've been drilling a lot. since 2009 which we're talking about this trough since 2009 is when we really started doing a lot of drilling. a lot of these projects are being cut back about that everybody was writing about canadian natural resources. but take a look at what they're saying. they're cutting back drilling but they will still grow production 7%. if you cut back drilling and you still grow production we're not done going down. so many people are bottom fishing, but i still don't like it fp. >> we'll hear from terry lundgren talking about the positive aspects before about
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roger altman was on "squawk box" talking about the stimulus. but in recent days, the concerns in the fixed income markets i would argue have only risen. perhaps reflective in the fact that equities were weak yesterday. the fixed income markets are very tough. clients are free zenozen i'm told. cash flows that you and i discussed which are only going down, and the distress that will be felt by certain of these companies. and even though many of them are of a smaller nature, nonetheless it does have a tendency too make waves beyond simply that company. >> i don't like to mention them but there is another one where i problem understand there a problem with did debt. china, europe, they don't purchase any oil. they're just net beneficiaries at this point. india, no. so what happens is yes, our
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country, there is a down side and a positive. there is no down side to china. >> or japan. where the five year yield is zero for the first time today. >> we're well below two. i remember when i said to david we could be below two and you did one of those -- >> i did. you actually said we'll probably be below two on the ten year for this year, if i recall. >> i was trying to think of the other side of delivering alpha. >> usually a good thing when it comes to their best ideas which should have been titled worst ideas. flattening curve seems to be scaring people. >> this is the cover of "money." don't expect blockbuster earnings this season. >> and i love that because what i'm worried about is as i was yesterday with alcoa, that expectations had gotten so high that you couldn't possibly beat
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them. i do think that there is a lot of companies where it's going to be questionable. i thought that was a very good piece p but when i looked at what alcoa did last night and i know alcoa is not going to be raging here because they're up so much, but they still beetd the number. and the estimates had come up for week. >> 33 cents was a 4 cent beat. and of course he was on with jim. >> the good news is we love aerospace, we love automatic office automotive. and you see the aluminum growth on top of it. >> best operating results for a year since '08. >> hireere's why he's upbeat. he took aerospace up from 9% to 10%. it had been roughly 7% to 8% for a while.
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he took up -- this was extraordinary. nonresidential construction, this maybe 3, 4, he's taken that to 5% to 7% growth. and then industrial turbine absolutely very, very strong. seeing between growth. that had been down a lot. soda cans. i mean cans. soda down very big, being made up by beer. the granularity of what klaus gives you is very exciting. but he was the most bullish i've seen him and i have dealt with him since he came in. this is the first time that the actual upstream the downstream is aerospace, car, truck, light weighting. this is a high are valuation company. i like it. >> what about this story today in the "times" talking about the fact airbus and boeing clientsesclients
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may be less inclined to order new planes. >> i articulated that thesis a month ago. >> that's true you did. >> the blow back i got the from every single piece of a plane, from every single supplier, every single airline company, why don't you do some homework, clown. literally i said that. well, this -- i thought i was so darn smart. i got -- they were down there giving me the business. >> really? >> yes. >> you have to explain why they called you you a clown a bit more precisely for me so i can understand. >> because i was like this. >> what was it that they indicated to you? >> they said yes, it's absolutely true that at this price should you have gas guzzlers not be taken out of circulation. the problem is the 25% decline in oil in the use is still economic. but most importantly these aerls areaerl s airlines are not cutting price. everyone thought there would be
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a price war. and their planes are full. so give us more planes. >> you and i have talked so often cop solensolidation has basically created -- >> yes, china. one of the things klaus pointed out last night, the order book has gotten tighter. now, some of the order book is from these irish companies that borrow a lot of money and lease the planes. you but i was taken to the wood shed by very good executives. this article, they came out with the thesis i came out with. they will not be taken to the wood shed. they didn't call me a clown. they said you usually do a lot of homework, jim. had you done some homework. >> that hurts. >> yes. they said our sweet spot about $80. but i didn't look at the new
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plane count and if i had looked at the new plane count and ordering, i would have been better served according to the ceos who decided to school me. in a made what nice fashion. >> i do think sometimes they do it th protest too much. but one never knows. >> sometimes you get the phone call. this show -- >> is the best. >> watching the show they're like call me after the show. >> there is this show and then there is every other show. >> i know. we'd like to think that. here is the way that they put it. let me walk you through it. and what that says is i'm giving and you d. nd i'm and i'm walking you you through it. >> so back to alcoa. p we don't have to worry they will see a slowdown on orders? >> i grilled him and he made a very big bet. he's bought this huge company. he's made two acquisitions now. three acquisitions. 2 million screws. and he makes all of them.
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there's a monopoly in screws. but i take to heart when the biggest leasing companies call me too, and say, jim, we've come to like -- we've come to like your stuff. we still like you. meaning -- >> you get another chance. >> meanwhile apple is getting a lift in the pre-har dead. credit suisse citing strong iphone fails and expectations the company will return more cash to shareholders. later this morning, we'll talk to the analyst behind that call. 215 million phones in fiscal '15, guys. and they argue that the 64 gb right, people are opting for the higher memory phone because they're shooting so much video. they think the 64 whether make up 52% of volume. >> let me circle back to say this is a war between apple and
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samsung. i think apple has won the war. they're using a $10 per share earnings you power for 2016 sho how can you not the own the stock. i know that's not a new theme, but it's always been worthwhile. >> got some pc sales figures. gart they arener up 1%. apple going to 7. >> some of the chatter about the watch is very strong. again, apple has been trading back and forth and back and forth on every single data point. sandisk linked to samsung. they makes flash and if you go to the store, you buy a flash, that business isn't that strong. margins have peaked. not necessarily a reflection about apple. sky works is much more apple oriented. >> nothing here about apple pay, but you continue to wonder whether that won't come at some point a as positive surprise. >> i'm seeing a lot of people use apple pay.
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some don't take p and he will pay. >> walmart wrong them. >> we'll see if he decides to roll all the record companies. he didn't call them clowns. >> no. >> he just ran over them. >> he pants them. >> i was going to say steam rolled, but i like pants. it shows you've come down to my level. >> i have. i've been at your level a long time. >> when we come back amazon gets an upgrade and the attention of macy's ceo. also ahead, cigna on the health care landscape and when what enrollment he's saying when it comes to obamacare. good vibes in the pre-market. we haven't talked about the upgrades for best buy and amazon and others, as well.
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amazon says it's created 6,000 new full-time job this is europe thanks to surging demand. the company also employs 32,000 permanent staff in the eu. upgraded from a buy to a
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macy's ceo weighing in earlier on "squawk box". >> we're a serious player in the online world by itself. but that's not the answer. in fact i will predict that five years from now any major online only company will have stores. they should, but i hope they don't. but at some point, you know they probably should. >> brick and mortar stores. remember the reports about amazon, but really all i think that was was a make shift distribution facility for the holiday season. >> i used macy's. i cannot believe the deals i get. i bought these shoes on maycy's. >> nice shoes. >> i get obviously amazon has --
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>> you're very wlim better. do you stretch in the morning? >> 3:30 a.m.. >> it shows. i could not do what you just did. >> the deals you you get -- and people tend not to return. i bought a pair of boots for 70 bucks if you act now. and i don't really like them but i have to go to macy's to return them? i don't know. >> so they have the o omni channel going? >> i did not get channel advise like channel adviser. but it's very pervasive. >> when it comes to amazon not only did they win an emmy but woody allen will do his first television series ever for amazon. edie falco, the stuff i've been watching has been amazon prime. things are changing rapidly. an actress on show time.
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>> this is happening much too quickly for everybody. >> whether or not it represents a significant profit and i use that word of course carefully profit generator for amazon, remains to be seen. but they're search competing now in programming. not to mention the broadcast networks still out there putting up original content. best thing you could be right now, somebody who is originating content. >> but then again i'm watching a game on espn and i'm saying holy cow, is this not network? no channel 572. >> that does bring us to best bine. goldman argues increasingly best buy has parity with amazon prices although the natural follow to that, is that a good thing. you don't want amazon profits. >> but they have a quarter of the market cap. it sounded like there could be a
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transaction. richard schultz was trying it booif the buy the company. >> you get past the number and it's not really possible. you won't see the huge mega deals unless you get someone in with you. by the way, what do you think ever the city oilgi call on amazon? they like the valuation trading. they say people still focus on revenue growth but really what they think you should be focusing on more is growth profit as a better measure given all their third party sales and price cuts the likes of amazon webster visits. 354 is their up side target. >> it's the same thing. you can go buy it and then you get a conference call and they say spend, spend, spend and you say why did i buy. where is that upgrade. what happened to me? and i just think that this stock right now is not to be owned.
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you can trade it. that will be a great hedge fund call. buy it today sell it at 308, everybody is high-fiving each other. at that time profits. rent an oil tanker. i mean this is not for retail. this is not for retail investors. it's in and out p. when they get to that quarter, and now they got a new cfo, conference call will be like you idiot, why did you buy us. that's the sub text. >> we'll get cramer's mad dash count down to the opening bell. take one more look at the pre-market. if you're woirrried about january, we're remind z last january, dow fell more than 5% and the s&p down almost 4%. we know how 2014 turned out. is rolled over into a td ameritrade ira. yes! so no set up fees! wooh! yeah! so i get help from rollover consultants? wooh! yes! no rollover
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time for mad dash. where are we starting? >> an itch to downgrade. stocks have moved up so much analysts want to plant a flag say i'm a genius, i nailed this. and some are. goldman goes buy to hold costco. momentum close to peaking. basically this is, hey, you know what, i made a lot of money make you a lot of money, let's not give it back. i like that kind of downgrade if only just because analyst got it right. >> showing some discipline. you can't blame them particularly if they had a good call. >> a great call. sgr i'd >> i'd rather see that than
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justityjust ity justity guying a higher call. >> speaking of that hewlett-packard has been a fantastic run. i think you have to say maybe it goes higher but without me. these are disciplined calls. but you are getting a lot of them. you get too many maybe people are getting too negative. but an individual basis, i applaud analysts who get things right and say you know what, i don't want to give it back. that shows that they're being rigorous. i like hp because they will dominate 3d printers. not this year because the people at stratus say he's so angry -- no the company is saying it's 2016 business. in 2016. you want to own it.
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>> anything else? >> we have a is ansandisk downgrade. monster beverage worried about coca-cola distribution. no, buy it. why? coca-cola distribution. and this by the way is where coke buys them for 135. and they buy keurig and they put thoems together and suddenly -- >> big smiles. all right. we'll see if there are any smiles at the opening bell coming up after this.
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a lot going on. upgrades. decent pre-market action. but it echos yesterday where the first half hour looked pretty good until oil took control and then it was over. but maybe today is the day that oil has a bit of a jump to it. oil was down this morning. when we got up to 330, oil down to buck 30. now oil is coming back up.
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if oil can stay up we will suddenly think about, well, wait a second. maybe the world isn't coming to an end. of course now you listen to the industrialists, they hope oil goes very low. but the market is stuck in a machine mode where it oil goes up, the s&p goes up. and right now oil is trending up a bit. >> lows 44.66. north dakota lowest since 2010. >> north dakota $67 oil. whoef whoever is in mississippian, you're struggling. permian, 34. that's why there is still a lot of infrastructure being built. >> but different parts of the bakken have different cost. >> but bakken is mostly expensive. a lot of things already been drilled, but you have to put it on a train, the train adds hone to it. that's one of the reasons -- >> pipelines are still cheap. >> and csx, looking for good
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things? >> they did coal. coal is in a dog fight against nat gas but nat gas is winning. >> let's get the opening bell down here and a look at the s&p at the top of your screen. janus celebrating its acquisition. and at the nasdaq flex shares doing the honors. >> i don't see bill gross. >> no, he's not there. >> pretty good breadth at the open. all these you you say you don't like up openings. >> i'm constructive. the pattern has been oil has a really big drop and then the next day it consolidates and then trades there for another day and then gets hid again. so the consolidation days, we tend to go higher. simplistic has been the name of the game in this market. >> we haven't -- jim, you did costco over there?
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>> yeah. klaus kleinfeld did a little pied piper. he said our business is stronger. health scare extraordinary. i'm seeing a lot of the big cap sfoks trying to stabilize particularly in the retailers. i'll put disney in the retailer category. people are for getting about tiffany. lundgren and klaus kleinfeld are having an impact in this market. lundgren on "squawk," not "mad money". "closing bell". >> i'm not sure what he said about residential. >> nonresidential very strong. >> got to go back a while to get a high. >> kbh gave you a 23450is preview. and don't forget there, are a lot of articles saying with the fha down we will begin to see some sort of revival.
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i know that there is a lot of summaries that say kbh is good. don't forget stewart miller wassed a today mapt that maybe we can break out of the recession numbers. we're building a million hoems. shomes. same number when we were half the size. >> half the size? >> isn't it a shocking number? we've had 16 million are more people -- >> the gi bill back then? probably. >> but 16 million people since the great recession and still the average household, still not -- owning apartments or living with in-laws. i did that. >> yeah well, you've different a lot of living. in-laws, car all sorts of places. >> i like variety is the spice of life.s, all sorts of places. >> i like variety is the spice of life. >> i'd love to get your take on direct tv. it's up a bit. but it's trading at a 20%
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annualized rate of return assuming the at&t deal closes which most people think it's going to. but what you've seen and what market participants have indicated to me lately is in these big cap deals, big cap merger deal comcast of course, you're seeing fairly large spreads. allergen has a rate of return of like 16%. why when you have long only selling some of these things and not enough perhaps money in pure good old fashioned risk to take up the spread. so potentially opportunities but interesting to note. >> money is cheap why aren't they doing this? why are they representing tankers? >> because there is risk aversion. >> what a week for tech myra.
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>> that was a speculative play on ebola that has now bag with this merger the number one hepatitis b play. go from like a tertiary company to celgene. i recommended it at 40 because there was piece in the new yorker saying this could be the greatest thing. but yesterday in an interview was saying some amazing things. yet every says he's being very conservative. and people are saying look, this company could be earning a fortune in 2016. i agree with it. >> you have a nice rally already. gilyard up over 6%. >> isis, one of my favorites. bio marin, which is an orphan
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drug. up another two today. this stock was at 55 and now at 99. >> lower oil prices don't really have an impact. >> they were saying we're the least economically sensitive company on earth. i want to point out isis the bad isis has changed its name. he's not changing his name. >> second best stock of the year is merck. >> good interview yesterday with merck. and merck is going -- i'll blow it wide open. my sblaefbelief is not that any of the drugs that we currently talk about, lung cancer drug, i think merck is working on alzheimer's
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and plaque reduction. >> if there were a real therapy to combat alzheimer's, it would immediately become the largest drug in world history. >> how about a pill that you would take. that's holy grail. a pill that you would take that makes it that you don't have plaque in your brain. >> in other words like lipitor for alzheimer's. >> bingo. and merck had it first and then warner lambert came out with a better version. but merck, 1985 '86, nevacor. and then they took to another level. >> until gilyard until now. >> hepatitis c, yes. >> in a tape like this, even downgraded names like hp doing pretty well. >> what happened with the volatility in this market?
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holy cow. oil up for about 30 seconds. not bad. >> that's all it takes. >> so with that dow up 230 as jim says. every component is in the green. led by unh. bob pa is anisani is on the floor. >> all ten sectors on the up side. and that's being led by technology stocks. nice move up in some of the big cap names. no new highs are particular breakout but great start to the day with apple and microsoft. texas instruments all on the up side. commodities is really again the problem. we got new lows. west texas down again. there we go. you can see it's to the down side. copper 5 1/2 year low there. nickel up changed. aluminum up a little bit. finally a bounce in natural gas. our second cold snap in two week
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weeks, so it's about time. china had a very small bounce. strange that decline in copper. china had pretty good newspapers. december exports up 9.7%. good numbers. we'll get gdp for china next week and a lot of people eagerly awaiting those numbers. but we have a great morning in europe, as well. a lot of european banks that trade over there. commerce banks. italian banks on the up side. unicredit to the up side. so europe is pretty strong. home builders are strong. you guys were talking about kb home. they reported an enormous income tax benefit because they had previously written down a number will of as of assets and they're using that to offset income taxes.
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average selling price up 17%. net orders up 10%. overall very good number. and we're starting to see some breakouts in some of the other home builders. you look at the home building etf, this this is a nunew president obama has made it clear he wants to lower housing market. you talked about alcoa. the one thing that is important is some of the new technology everybody keeps talking about allege alcoa is a cost cutting monster, but they announced new important technology micro mill technology this will enable them to manufacture aluminum, 30% stronger than existing aluminum projects. remember aluminum parts compete in the automotive industry.
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this micro hillmill tech following will enable them to make parts 0% lighter than comparable steel parts. so everybody talks about how great a company they are.340% lighter than comparable steel parts. so everybody talks about how great a company they are.0% lighter than comparable steel parts. so everybody talks about how great a company they are. but you didn't get big technological breakthroughs very often. it could be a 3$3.5 billion addition for alcoa's overall business. i know you've been talking about alcoa and did a great job with klaus. really only announced in december. so we're ramping into that curve. back to you. >> thanks very much bob. broader market rally here. don't mean to rain on anyone's parade as the s&p up 1.1%. but i did it just look at -- >> great graphic. >> i wish they took that shots 6 your face looking at me. i did want to mechanics atntion the bobd mar bond markets.
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big high yield market, 18% made of energy. leverage finance market. i don't want to say that we'll see a lot of bankruptcies potentially as cash flows get meaningfully reduced among so many energy producers in this country. i don't want to say necessarily that they will be holes this big balancing sheets or banks at the very least their lending question will go down. but i don't need to say it because that's what people are somewhat concerned about when they tip to invest in the equity markets. and you don't have to look very far to see those concerns reflected p by ed reflected. last year $134 billion in leverage finance was done. highest annual volume. oil and gas 12 percent of all leveraged transactions. and then you can go back the bonds on some of these things are trading at meaningfully depressed levels. yesterday jim and i were talking off camera about the sampson
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deal. there has been press on this recently. $7.2 billion leverage buyout. 322 cents where those bonds are trading now. so where are we? every day we seem to go up and down based on oil, but we're now in the mid-40s. there is a lot of concern out there when it comes to at least balance sheets and fixed income in particular. i mentioned earlier the freeze that is going on more broadly in bonds. etfs and the like are down some with bigger concentration. energy are down a lot more than others. what does it mean? too early to say. are there a host of securitized products back on back on back the way we saw with house something no. that's a good thing. that means the risk is more or less potentially at least contained to who holds it.
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but there is a concern fix theed come and worries there lead the way and more often correct than not p. >> southwestern had to do that big share. but most of the companies that i followed cannot do a shared deal. >> i'm hearing more and more that may be the model in this environment. issue the shares as you can now become the vehicle that will start to clean up some of this. you will be a survivor you will be that platform. so, yes, you do a big dilute of equity offering but live to tell the day. >> you have a $2 stock, you can't do that. but i am adopting a marty feldman strategy. remember marty feldman? >> i do young frankenstein. >> one eye completely on him and the other eye on the count. marty feldman died. at 48.
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>> the hump was on that side. >> he was a funny guy. a great movie. >> let's stay on the bond market. >> of course cognizant of the fact we have tens and 30s on tap for auctions today you'll notice parallel shift in the curve, everything is up a couple of basis points. but maybe you should be watching two dates and those dates are october 15th of 2014. maybe more importantly the last couple week of july of 2012. and you'll see why. let's have a couple of charts starting in july of 2012. if you look at a five year note yield, you'll notice that it's currently at 140. but where was it when it made its historic low? 54 basis points. where was the ten? 138. and of course we all know that we're copying this kind 186 to 188 level. but we also have the 186 from
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the wild october 15th. but here is the key. and the reason i picked july of 2012, because that was somewhat of a major bottom in terms of yield. but look at the 30 year bond. its historic low was 245. yesterday, it was under 250. today it's up a couple basis points. that's the level you want to watch. where were guilds at that time? 158 now. but the point to this chart is you can see that the gilt unlike the early part of the curve hasn't come done to those levels. they're still virtually on historic lows. jgb's not inaccurate. 26 basis points. and trades by appointment.
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think about that from a la liquidity perspective. euro still flirting every day with fresh ten year lows. and the dollar versus canada a bit of a reprieve but still very close to the april 2009 lows against the greenback or high against -- anyway you you want to look at your trading card. >> thanks so much. oil will be in focus yet again. jackie deangelis at the nymex for us. >> bad news in terms of commodities despite the stock surge. oil trading leeower 46.56. we hit a session low 4 #4.20. settling undert $50 mark yesterday was paramount. pushing prices lower, the stronger dollar. but also more comments from opec members suggesting that there will be no backing town in terms of production. that was from the uae oil minister. of course negative sentiment
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continues. meantime, i want to point out we have options expiration tomorrow, so that could create volatility as traders are sort of hedging around those options. but also want to point out that gold is bucking trend despite that strong dollar. a little bit of safe haven buying here. gold is a trade some people for got about, but some are getting back in. >> when we come back, apple taking part in today's rally after being upgraded by credit suisse. we'll talk to the analyst who is making that call. meantime dow up 276 points. every component in the green. exxon is if last place. best day for the dow since last thursday.
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and a lot helping you. technology that's with you always. this is our promise. it's never been better to wander because wherever you go, you'll find us doing everything we can, so you can. big rally in the dow. a lot going on as earnings season takes off. oil would you argue is providing some stability or not? >> no that's really -- i mean oil goes back down we just
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switch. i thinks's so funny that alcoa is really one of the proximate causes of this rally. of course alcoa now down. i keep coming back at celgene. but a lot of health care we're seeing beg benig beneficiaries. a lot of belief that what happened yesterday was one off even though it was tiffany, is an tiskis ansandisk. so if oil stablstablizes, buy shall tech. >> people will be looking for signs of wage pressure. >> we need to continue to see wage growth.
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about if but if you own stock, that number is not ideal. we're hiring more people and they're making less money. that's what people want if you're a ceo whether you like it or not. >> now positive for the month of january.
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dow pretty close to session highs. >> e com is not a split you see. stock down 52%. they said the big guys have figured out they don't need our advice. that's my takeaway. what have they figured it out? give the money to google. so google is actually higher. and google has been one of the big underperformers in tech and has pulled a lot of tech stocks down. so e com's loss i think is google's gain. they did not say on the conference call. that's my own. >> people have been wondering if it would get back before 500. >> it's been such a dog.
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that thing has been a black hole. >> what's a mad tonight? >> we have halo. these personal biotechs that people like. and then flextronics. it was an idea that i got at delivering alpha. and it's not yet delivered alpha. but you never know. >> stranger things have happened. not sure what they are, but they do. >> jim, we'll see you tonight. >> thank you guys. i shouldn't have shown the rockports. my bad. they were stuck in the rain and snow yesterday. >> when we come back we'll stay on top of the morning's rally.
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and aleve is proven to work better on pain than tylenol arthritis. so why am i still thinking about this? how are you? aleve, proven better on pain. good morning. welcome back to "squawk on the street". pretty good rally here under way. dow up 267. alcoa of course getting earnings season started with a pretty good note. in oil it continues to fall. we did get down to 4466.
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but off that low. west texas now 45.62. >> earning season kicking off but which companies will bring the most profit growth? we'll tell you who could be the winners and who could be the losers. >> and how the strengthening dollar is causing all kind of problems. >> and we'll talk about the analyst who made the call about amazon. >> and coming up a little bit later, actually let's start with the markets. we are seeing a big rally. 277-up on the dow. oil's continued plunge to new multiyear lows. joining us to discuss all of this chief investment strategist jeff rosenberg. scott, you've been on a bunch of times and you've told us this recipe of low inflation and good
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economic growth and solid job creation is positive for the markets. so how do you explain the bumpy start to 2015? >> there are a lot of things going on in the world and most having to do with lower oil prices. if you look at the effect on high yield debt about 20% of the issuance in high yield here in the states is thrgenergy. spreads have widened out. people are worried about that. they're worried about the lower oil prices and the effect of a stronger dollar. we have greece election coming on the 25th i believe, at the end of this month. so we have a lot of things to worry about. but i think you want to put it in perspective. we're less than 2% off the record high. so i think low inflation, modest growth, that situation still intact. it will be intact probably for a couple more years. >> so what is then the message, jeffrey, of the bond market?
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this morning we got awfully close to that 186 level on the ten year note yield. the freak droughtoutlevel of october 15th. what does that tell you? >> it's clear they're fixated on the inflationary impact on oil prices and globally in terms of declining price pressures. all of which has been mainly reflected in a fall in inflation expectation. most of the decline was a decline in inflationary components. and to see that continue, you really will have to see much continued pace of oil price declines which obviously if you get lower and lower oil prices it's harder to see that continue. so we think there is an overnight going on here. >> and you point to the chanced inflation expectations around
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oil, jeff, but water not seee're not seeing it in wages or other commodities. is it a realistic threat for the u.s. economy? >> we have to be really careful about using the word deflation. a deflation is a very hard outcome to get to. i think what we're pricing this to the markets is falling inflation. what you saw last friday fed into the short term discussion around this inflation expect takes. disappointment on wage inflation. we saw an unwind of a pretty strong print in november pretty strong decline in average hourly earnings. and that's fed into some of the short term expectations. with you but if you look at the strength in the labor market, what we're seeing looks to be too short term focused. we'll have stabilization around the wage front. that will help stabilize inflation expectations.
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>> is it highlights the disconnect. people looking at the numbers going what are you talking about, the dow up 270 points. technology is up 2%. i.t. up 2 #3.5% for the week. and really important though it may be you continue to have bid under the market. why is it able to take a stock so far above where you might be according to the rest of the conversation. >> when you look forward, we'll set new record highs in the market next year. corporate earnings are going to be at new record highs. inflation will be low. valuations, a lot of people talk about valuations, but if you look at on a pe basis, median pe, 16.7 over the last 30 years. we're right there. a lot of good
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things going on in the market and i think total return this is year will be in the 6% to 10% range. that's good not great, but, hey, i think that's possible for the next few years. if that's the case people need to be invested in this market. >> then that's the major takeaway. jeff, given all that you just said how did you explain this phenomenal rise, 261 on the dow? >> it goes back to what i was just saying to sarah. the difference between deflation and disinflation. low inflation is not a bad outcome for equity markets. deflation is a terrible outcome. so what we're really talking about is disinflation, that could be supportive to the committee side. fierce fears of deflation i think are misplaced. >> scott, end on an earnings note. although we are set to go into a quarter with 1% earnings growth
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because of energy. are you not concerned then about what that does to industry as a whole, to capital expenditures which are also looking down and not to mention the guidance we're set to get given some of the macro headwinds? >> there is definitely negatives here. and i think earnings for energy in the fourth quarter will be down 10%, 20%. hard to get a fix on. the market knows that. the prices are reflective of that. this quarter, 2% to 5% somewhere in that range. you need to look ahead. next year, these low oil prices will be net positive it the economy. you will see more capital expenditures, better confidence better consumer spending from other segments of the economy. so net net, i think it will be positive. you'll see gdp at 2.8%, maybe a touch above that. >> gentlemen, both thank you very much. we'll he said itend it on that note of
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optimism. >> we're 100 points away from regaining dow 18,000. let's get more with dom chu. >> let's pick up where they left on that. rbc capital markets looked at all those earnings per share forecasts and they estimate that we could see earnings per share growth of around 4.5%. so there are a hand full of names that will drive that earning growth story and drag it down. so bad news first. his team took a look at the biggest krags for sdrags in fourth quarter. oil and gas, no surprise, a big drag. out of the 4.5 gain in earnings per share, a drag will company from oxy dental petroleum,.02%. con pnieocophillips conocophillips, also there. chevron and exxon, expected to drag nearly 1.5%.
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now let's move on to the but news. this is where it gets berkshire, expected to contribute positively. 4.5% earnings per share grooetwth. look at this, apple and gilyard these two stocks he says will account for over 2% of that 4.5% earnings per share growth. so again just two companies are going to account for nearly half of the earnings per share growth figure that a lot of analysts are expecting for this fourth quarter. >> that is an amazing statistic. let's get over to rick santelli. >> jolts a lot of components, but if we look at the headline
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job openings just shy of 5 million. so that is an increase over last month of 142,000. if we look at quits, they're holding pretty much at 1.9%. separations, dipped a little bit to 4.6 million in november. so we want to continue to pay attention especially as we get close to that 5 million headline number. >> up next david cordani will join us. we'll get his views on obama care and where he sees new opportunities for growth. sn't a street... return on investment isn't the only return i'm looking forward to. for some every dollar is earned with sweat, sacrifice, courage. which is why usaa is honored to help our members with everything from investing for retirement to saving for college. our commitment to current and former military members
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but anyone can help a foster child. welcome back. big move for the dow. etna is moving higher after it said it expects to add more medicare and public exchange members in its current quarter than it previously projected. this as it continues to benefit from the new health care law. it also plans to boost the incomes of its lowest paid workers by as much as a third as a result. those shares up 2.5% on the day's trade. >> raising the base floor range
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to $16. bertolini is ichlti expected to saur say say its provides a better informed workforce. joining us now is the ceo of the rival, david car cardoni. it looks like he's gaining. what do you think of the hike to $16 an hour for the lowest paid within etna? >> well, i think more broadly, we're a health service company. the goal having a highly engaged active effective workforce is mission critical. we're proud of the fact that we have a phenomenal workforce
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globally. >> will you be doing the same? >> well, we have a little bit different framework. the vast majority are not hourly configuration and we make sure that the overall wages, benefit, configuration of what they have are market competitive or beyond. and we always make sure we're staying ahead of that curve. so to me it's an evolving process. the most important thing is do up theinfrastructure where individuals want to come to work and we're fortunate we have a if a phenomenal work forns aroundforce around the world. >> and your plan is to double the revenue base. i know that's the target. >> if you look over the last five years, we have doubled the size of our corporation with about a 10% organic revenue
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growth. that forward looking comment is a continuation of that saying over the next 7 to 8 years, we'll have a compounded annual top line growth rate of 8% to 10%. and we're excited about that given the profile of our business. >> i understand there are three sxwit exciting areas. medicare medicaid and exchanges or expansion of the individual businesses. and what etna is saying when it raises the wages of its workforce, it's primarily to deal with the individuals. because they will have to be better trained to train to sell to. recently you outlined the overall strategy and citi came away wondering if you actually as they put itted a the cultural mindset to be successful in the individual businesses, whether you've priced correctly. you were abandoning some of the qualities on the table.
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what do we supply for that price. is that a fair comment? >> first relative to the very important part of the individual we believe the individual whether continue to become more active. just a little context. we serve about 85 million customer relationships around the world. outside the united states we have about 15 million individual policies apabout 15,000 colleagues have focused just on individual business. back here in the united states it's only about 3% of our revenue and we focus very tightly and narrowly in 2014. and we didn't expect to make money in that in the first entrayen entree. but that's what transpired. . and the ability to serve the individual -- >> forgive me.point that i'm making to you, is that of -- there are three big areas of expansion for the industry. one is the individual markets. which some would say you're not positioned for and you've basically just forgive me if i've got it wrong underlined what i'm saying no, we're not
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positioned for it. it isn't an area of expansion for me. the other two medicare an medicaid. citi points out you don't have medicaid exposure. do you think there might be an acquisition there? >> no. let's break it down. for the individual baste business business, 8% to 10% revenue growth rate. so that is a future opportunity. relative to medicare in our chosen market we're one of top three players in medicare and we spect to see that business grow again this year. about mid single digit covered life growth. and we have phenomenal clinical outcomes. and medicaid we've chosen to only play in the high risk population where clinical programs could work. this states like texas and illinois. so we've been very focused in terms of where and how we're trying to grow and our results demonstrate we're doing a phenomenal job.
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>> so it is within the discipline that you've described, that's the deal? >> correct. state by state and focusing on those programs where we think we can add value to the individuals which typically are those that have more clinical or health burden working within our professionals within our company and physician partners to coordinate the care. >> and there is a huge issue with return to cash to shareholders. 240 point in asking about it thousand. but will you be come back when you deliver your results? >> absolutely. and just for context with that we have a tremendous free cash flow within the corporation and strong capital financial health. through the first three quarter, we returned about $1.4 billion to our shareholders and we look forward to the next quarter's conversation with you. >> i look forward to having it with you within weeks. thanks for joining us, david
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cardoni. >> when we come back the hotel industry being affected by the strengthening dollar. and plus markets in the midst of a rally but well off the highs here. art cash pkashcashin whether join us onset.
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to talk to your doctor before you begin an aspirin regimen. we get advanced data in the lodging industry which you may find interesting. joining me now patrick, from sun terrorist. good morning. >> good morning. thank you for having me on. >> so travel is unique in the industry in the sector. why? >> well, it's unique that you have some what haveof a visibility
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where guests will book a week to several months in advance. so you have a good idea using analyzing those forward bookings how future demand and pricing is shaping up. >> so unlike other industry, you can see the intention as to what they're buying further down the line. what did you see now? >> most markets are doing extremely well, but one soft spot is new york city. if you were to fwe ongo on last night to any online booking site you could find decent hotel rooms for under $90 a night between now and through mid-february. and really what is going on is foreign exchange is hurting international tourism. i mean new york is the biggest international tourist market in the united states. almost half the guests are international. it hurts. >> you have data from millions
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of transactions in the future. what do they tell you about what will happen moveing forward? >> new york city does tend to an shorter term market. right now the key metark is revenue per available. only slighter better at 2 q at negative 2. i suspect that may soften as foreign exchange has -- >> what is the rest of the country doing? >> plus 7. new york negative 5. >> and there are other factors. we had new supply coming on. so you're not crystal clear that's all about the dollar. >> as an analyst, i have to mack my best estimate based on the statistics. we know that there has been 5% to 6% use of compounded new supply. this year should be the same. because there was strong
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international demand, now that international demand is getting hit. supply is certainly compounded with -- hot helpnot helping. >> we were also discussing the price of oil to shale investments. what do you see there? >> we look closely at the two major cities in texas, dallas and houston. and definitely not as weak as new york, but slight underperforming the market. i'd say dallas where the u.s. market is tracking 7 for the first half of the year, sdlas tracking closer to 6. houston tracking closer to 5. so slightly softer. but we haven't really seen any shock to hotel demand. >> interesting analysis. patrick, thank you. we are in the midst of a pretty nice rally here although off of the highs. dow up 238. art cashin joining us. we have blown through what you said would be resistance in your note this morning. but you seem to have some qualms
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about the quality of the rally? >> well, to get validity we really have to move up through 2065. which was thaslast thursday's high. otherwise you run the risk of maybe a pseudo double top kind routine and pull back. i think most of the stimulus for the rally comes from europe. there is a lot of new conversation about what the ecb will do. several members of the board talking it up. so it sounds like draghi may not have that big a problem. that kind got us started. and i said earlier off camera, you can't always tell short covering, but it feels like it. >> and it still pays to buy the
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debt. we go through the short volatile pull backs and if you hang in there, it looks like we get the sharp rallies back. what changes that dynamic? >> i'm not sure what will change, but you make an apt point. one of the strange things is we talk about the buy the dippers in v shaped terms. they're not exactly v shaped. what happens is you get a first turn and you get a failure like you did last wednesday and thursday and then cow back off it like a very vopgstrong rally like this one. >> alcoa, you would take it rather than leave it i guess. >> i think it's a little early to take. if you take out some of the energy earning, it kind of confuses it. so they're looker closer to delight. >> q3 earnings up 10.3.
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estimate is now 4. we all know why that is. >> we hope we know. if its there's another reason, it would be a big problem. >> towndowngraded costco. investors have already priced in the benefits of low gas prices and ignoring or not paying enough attention to the pressures that information for. orex will bring. >> there is some of that. they're looking at the thing, they believe that natural course is for the dollar to get stronger. but i don't think they're focused in on it as far as will it be a grand drag on earnings in the way we speak about it. >> we saw it in examples. i wanted to ask you about gold now at a 12 week high.
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nearing the 20 level. that is a warning sign perhaps? >> again we have a slightly higher target. i haven't timed it out, but gold is approaching a down trend line. so i think you need another $20 move or so to prove that you're not still in a series of down trends. so you need another $25 or so. >> meantime china trade data was no good. uk inflation. no good. jolts was a little encouraging, but in general you'd probably argue macro skewed to the down side today. >> yeah, i'd think so. some of the data out of europe was not only disinflationary, some of it was outright deflation. some of the numbers year over year were actually negative numbers. >> and what is the read on the ecb, will that ultimately determine the market correction here if the united states or has it been already tell sgrafed and
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baked in? >> no i don't think so. i think some of your benefit today is the update tone you're hearing from the members of the krechlt ecb. i think the worst thing is to try to talk their way through it. saying we plan to do this but next week or whatever. i don't think they're ready. and if draghi doesn't have everybody on his side, that open presidency in italy may look tempting. >> unicredit says wait until march. >> big disappointment. >> thank you. >> straight ahead, amazon is in the green announcing that it signed woody al whenlen to make his first ever tv series. also citi upping the stock to the buy. d pete najarian here. the popularity of options trading has skyrocketed. but we still hear from viewers every day who don't know how to profit from them. so we wrote an entire book to show you how we trade options.
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we're just over an hour into trade. good morning. this is cnbc's "squawk on the street". 10:3 here on wall street, 7:33 on the west coast. celgene is one of the biggest fwaners today. issuing fourth quarter guidance before street forecast. dow up 230. a strong dollar and a challenging industry environment particularly in europe. walmart amongst the stocks
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hitting new all time highs. dow component up 17% over the past 12 months. >> shares of amazon trading higher this morning. right now right around just below 3 ood. terry lundgren weighing in on whether the internet giant should open a store. this was his response. >> i think at some poents they should. but i hope they don't. but at some point, you know, they probably should. >> on the news line this morning, the analyst who made that upgrade, mark may, joining us. poetic that we're right at 300 because you say there is valuation support. why? >> i think you're right. at 300, the company is trading in line with traditional retail peers like walmart, target ks coe despite the fact that amazon is agreeing about four times faster than this company and
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despite the fact that amazon has proven to be able to generate comparable if not even high are mar begins than those companies in the past. so that's really where we think there is valuation. especially as the online e-commerce continues to gain share. >> the chart shows you it has held pretty firm above 285. you say holiday looked pretty good and then margins can reverse the recent trend. that's the one people might have a problem with. >> so we've had a good done grade of amazon back in july of last year. what was not known and not priced in was the her have iavy investment cycle the company was going threw. investing in the cloud services,
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new hardware devices, et cetera. when we look out into this year, we didn't see the investment cycle being greater than what we saw in '14. we think you'll see stable and more likely increasing margins as we go forward. and remember this stock is important. they use to invent-centivize employees. >> we've heard amazon bringing on a tv show and they won a golden globe. do they bring in new be subsubscribers to prime, make a difference on the bottom line? >> amazon is a quiet giant when it comes to premium video. i think 2014 was really the company's coming out period in terms of investing more in premium content. recall the exclusive hbo output
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deal they announced earlier in the year. more exclusives like the golden globe on sunday. and what we saw in the back half of the year was an acceleration a real improvement in prime subscriber growth that the company itself is talk about. i think that you have to -- it's not a coincidence. i think the investments in kept is helping you drive more prime years and prime users spend more than nonprime years. >> goldman says they're getting more parity with amazon specifically in tv. is that true? >> i think the three competitive edges that amazon can play with pricing, convenience, and selection. pricing has definitely about two years thousand been less of a lever that they have been pulling. it's been more around selection, the breadth of selection of
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products and the convenience before all the investments in the delivery network to enable same day next day, two day shipping all across the u.s. and many countries. so i think pricing is no longer is lever. >> and on that note when it comes to grocery deliveries, startup instacart raised another $220 million. where is it in terms of being able to make money is that correct a competitive threat that there are other players in the game or do you see amazon fresh as a category leader here? >> we all know web van. web van was ten years ago. we've been doing online groceries or trying to figure it out for a long time. yet only 1% of grocery sales is online. i think that tells you something. consumers aren't really ready to go there en masse. and i'm happy that amazon has baby pretty measured in the
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amount of ib skresnvestments they have been making around perishables. i'm not sure there is a wide massive feel for that product right now. >> mark thanks for your time. mark may joining us from citi. and coming up a bit late erk shark tank's kevin o'leary will be joining squawk alley live. he'll weigh in on google. plus what he thinks of the upcoming box ipo. o know how hard it can be... breathe with copd? it can feel like this. copd includes chronic bronchitis and emphysema. spiriva is a once-daily inhaled... ...copd maintenance treatment... ...that helps open my airways for a full 24 hours. you know, spiriva helps me breathe easier. spiriva handihaler tiotropium bromide inhalation powder does not replace rescue inhalers for sudden symptoms. tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. these may worsen with spiriva. discuss all medicines you take, even eye drops.
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all ten s&p groups are higher right now. i.t. is in the lead. dom chu has more back at hq. >> by a good 50 basis points. so lots of green on the wall. that technology sector, the
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biggest one. avago, micro chip, f 5 among the leading stocks. a lot of rebounding after the recent oil selloff in the stock market today. something a lot of investors like to see of course like we say this is the biggest sector in financials coming up on deck for earnings season. >> let's kick it over to rick santelli for this morning's santelli exchange. >> thank, simon. i'd like to welcome our guest this morning, richard favre. thanks for taking the time.s, simon. i'd like to welcome our guest this morning, richard favre. thanks for taking the time. >> thanks for having me on. >> you know, today we saw the job openings and labor turnovers. and there is a lot of granular data there. but i walk away with the notion we have had better job creation but it's also about the type of job, the pay, and i noticed on openings and hires, that if you look at leisure and hospitality,
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you have to bring down by industry to try to find quality and less quality. nothing wrong with leisure and hospitality, but they tend to be lowe lower paying jobs. jolts is that telling me something or am i reading too much into it? >> i think one lean you should read in the report is that there is less government hiring. that is a positive for sure. in regards to the leisure and hospitality hospitality, there is a linkage that i think is important for your viewers to think about. about four months ago the fed stopped buying asset. inflation expectations have come down. gasoline prices have collapsed. they're sub $2 today in new jersey on the way in here. consumers are feeling good. consumer confidence has moved up and lo and behold we're seeing growth in leisure and hospitality, not just job openings openings in the jolts rourt, but ss report, but in the monthly jobs report
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wage gains and as well as -- >> but on wage gains, see is this the problem with percentages. let me stop you there will. and i've done a lot of research in this area. wage gains are high are because the pay is lower. but if you look at it as actual rate of pay, it's still in the lower tiers. >> i agree. if you look at the jobs report from last week that's the case not just leisure and hospitality, but in the entire economy. some of the highest earnings sectors like the tech sector you're not seeing job growth. so it's very confusing right now what we're seeing in the jobs data in that some of the highest earning areas are not growing the jobs. and i think that's why you're seeing aggregate wage data seems to still be under pressure. >> all right. one of my big things whether you look at a japan via the glasses of history or u.s. and europe productivity is not doing what
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it once did especially in the u.s.. however, productivity seems to be picking bit. but it might not be a good thing. and i'm basing this on what wages and workweek are doing for the last 30 second, give us your thoughts. >> well, there are secular trends. one is automation, row about thebotics taking jobs away. another is what is happening to full-time employment given some of the new health care rules. we think that is a factor as well. so unfortunately, it doesn't seem like people are getting the hours that they want these days for a variety of reasons. >> all right. richard, thank you for taking the time. carl back to you. >> when we come back, the company that gives you a 360 degree view of your favorite events from the comfort of your mobile device. where will you you you seeuyou see technology next.
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second day in a row we've had an up open on the markets. this one lasting a little longer. west text crude which had been lower all day has gone positive. let's get to dominic chu. >> one of the what's happening with oil. the other one happening with another smaller stock we've been talking about quite some time here, ac quinn financial, plummeting following a report in the "l.a. times" that california is looking to suspend the company's mortgage license in that state, due to failure to turn over documents that show it complies with the state's homeowner protection laws. in twice its normal volumes those shares down by about 37% in today's trade. back over to you. >> wow. ouch. thanks, dom. our next guest has produced content for nascar red bull and is partnering with samsung to produce content for their new virtual reality headset. today joining us at post nine to announce the commercial launch of their camera systems and software that stream live 360 degree video to any connective device. the ceo of real-time emergent or
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rti. good to see you. >> thanks for having me in. >> tell us about your technology for those of us who haven't heard from you. you've been doing this for two decades. >> this is a military technology that we've licensed from a contractor and it actually is a patented system that allows you to capture and live stream 360 video to any connected device phones tablets, pcs and virtual reality head seths. >> i would imagine that just in the last year the development in virtual reality have opened all sorts of opportunities for you. >> yes, there has. there's been a tremendous excitement about the launch and oculus rift. we created a set of episodes for the launch of samsung's device and we hope to do a lot more. >> greg physically talk us through what it does there if you would, as you were in the commercial break. i think you think you've told us and it's fascinating with the six cameras. point us through. >> okay. so in this camera what you have is a parabolic mirror at the top and it captures the entire
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environment in 360. that then reflects off a mirror on the bottom of this which you cannot see. it passes up through a series of eight corrective lenses and hits the camera. that's the actually very complex optical processing. >> no seams from stitching video together 360 view. what does it look like? >> single camera sensor. we get it all off the camera live. it gives you a strip of video we then join the edges of the strip together in a cylinder so you're in a seamless environment 360 video. >> how is it used in a military context. >> originally developed it to look for roadside bombs in afghanistan and iraq and right now they have a version that's on the parascope of nuclear submarines. >> wow. >> that's amazing. >> that's a 100 megapixel camera. >> i imagine the way you naturally want to, here they're scrolling through 360. presumably you want to protect 360 degrees around you. >> yes. >> ultimately in some form of helmet or room.
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>> and the vr headsets are doing that beautifully today. >> do you think apple will develop a vr head seth? is that next in the pipeline. >> i'm not sure. i was a little skeptical but after seeing the hype any enthusiasm from fans and consumers i think it could be a real thing. >> my thing with virtual reality i'm fine without virtual reality in my life. why do i need it? why will it make my life better to have a vr headset? >> i think there's a trend towards more immersive content. that is something that won't stop. avatar movies that bring you deeper into the experience and you won't be wearing a virtual reality headset for everything but certain forms of content. >> does it feel like the promise is in the consumer space the way sara is saying with gaming or is enterprise going to surprise us? >> the commercial side? >> it easily could. if you're a doctor or if you're in the military i can see virtual reality headsets becoming useful. we've put our cameras in fighter
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jets an it's compelling and feels like you're seeing something beyond just a straight video when you're watching. >> got to be a lot of competition in your space driving content for this entirely new industry and all the promises it holds. where do you fit in in the competitive landscape. >> most of our competitors have multiple cameras pointing outward and all that video and stitch it together. we don't have to do that and that enables us to output this video live so we can sink directly to broadcast. we can be on the sports fields. we can do -- basically do everything that we want to do that you guys do in your broadcast. >> wow. 36 360 live "squawk on the street." thank you. >> thank you. >> very cool technology. greg easily is the ceo of real time immersion. >> you know as you get older you will appreciate that more. >> 360 views. >> live your life vicariously through other people. >> i would like a 360 view of you, simon. >> to jon fortt and what's coming up on "squawk alley" in six minutes time.
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>> good morning, simon. big day for it tech. we're going to talk about apple's upgrade from sweds it swiss. what does it mean. also amazon going with woody allen in a tv series and markets in general are up and tech heavy nasdaq near session highs follow all of that and more on "squawk alley" coming up. hi. pete and jon najarian here in new york city outside of the nasdaq, where we bring you live daily market updates. and today, we have a very special free gift for you. so many viewers e-mail us wanting to know our secrets on how we trade options.
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so we're up 257 points on the dow. let's have a look at the session so far despite all those concerns we have about low interest rates still the market able to make significant gains, information technology health care, very good gains today. don't forget we have the jpmorgan health care conference out which we have series throughout the day and actually a bit of a boost from aetna when it suggested that it would be able to enlarge the business or grow the business both the bottom and top line to a greater extent. >> we're watching the price of oil as we have been every day coming off session lows turning positive. there's wti and brent crude and what's interesting here and traders are pointing out that the spread between the two is coming in together. that gap they're almost at parody. in other words, you're almost seeing the same price of wti and
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brent. wti the u.s. brent the international benchmark, just below $46 a barrel. >> this the beginning of earnings season. >> yep. with energy in the lead. again, projecting 1% earnings growth a lot because of the energy declines and the fact that we're supposed to see lower declines. we will be watching the banks that kick off in full tomorrow. bank earnings wells fargo, jpmorgan, as always. >> don't hold your breath for dividend increases. with the dow up 246 points send it over are we ready, to "squawk alley," and the gang. >> good morning. 8:00 a.m. at amazon headquarters in seattle, 11:00 a.m. on wall street, "squawk alley" is live. ♪
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♪ good morning. welcome to "squawk alley." playing some gesh wynn in honor of woody allen. joining us from palo alto roger mcnamee co-founder of elevation partners, great to have you back. with us jon fortt at post nine kayla tausche has graceds us with her presence once again. good to have you back. >> good to be back. >> markets in rally mode dow up 245, looks like a lot, the best day for the dow since last thursday but the dow is positive once again for the year. just about. s&p is up to 2053. crude oil, providing some stability here as west texas has once again gone positive. apple shares meantime gaining nearly 3% after getting a pretty nice upgrade this morning over at credit suisse. they see greater iphone 6 sales driving the stock higher on the back of pc sales out last night.


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