tv Worldwide Exchange CNBC March 9, 2016 5:00am-6:01am EST
a very good morning to you. u.s. futures pointing to a positive open as wall street markets the seventh anniversary of the bull market today. but at least one investor is raising a red flag. we'll tell you what he's worried about straight ahead. happening now, oil prices rising. is a bottom finally in place? chevron ceo making a call. and decision 2016. donald trump adds delegates to his win column while bernie sanders turns in a major upset in michigan. it's wednesday, march 9th, 2016. "worldwide exchange" begins right now. good morning and welcome to
"worldwide exchange" on cnbc. i'm sara eisen. >> and i'm wilfred frost. u.s. equity futures at this hour, let's have a look. they're pointing to a slightly positive open, taking a cue from european trade perhaps. we're looking at the dow called up by 74 points. the s&p by nine. the nasdaq by about 20. of course, also rebounding from a couple of soft days of trade after, of course, a nice bounce the previous couple of weeks. today marks the seventh anniversary of the current bull market, even if it hasn't always felt like one lately. check out these returns. the dow up 159%. the s&p, 193%. and the nasdaq 266%. we'll have much more on u.s. stocks in just a minute. >> and whether we're still in this bull market. but first, let's get you up to speed on the trading action overnight in asia. chinese shares dropping on renewed concerns about the economy over there. the chinese currency weakened,
and the chinese stock market broke its five-day winning streak. japan's nikkei closed lower by almost 1%. a stronger yen hitting some of japan's biggest exporters. the currency there has been strengthening on the back of risk aversion. keep an eye on that into the u.s. session. >> the u.s. dollar more broadly, softest level since mid-february. now to early european trade. let's have a quick look. we're seeing green across the screen. nothing too pronounced. let's check in on currencies. as we just said, the u.s. dollar hit its lowest intraday level since the 22nd of february. it's just seeing some softness against certain currency pairs. the euro up. the pound has had a zeent little rally. we got down to the 139 level. now 142. >> so will the u.s. follow
europe higher or china lower? so far futures are higher. oil will be a big factor. it was a big driver in yesterday's trading session. let's show you what crude prices are doing this morning. they are up by more than 1%. wti crude almost at $37 a barrel. brent above that $40 a barrel mark, up 1.2%. worth watching today as you keep your eye on oil and stocks. the eia will release its we cannily inventory data 10:30 a.m. eastern time. also, the chevron ceo did share his view on the price of oil. >> i think we've seen the bottom, but there are forces at work. you can see decisions made by opec nations or others that would add to supply at a time we don't need it. but the fundamentals are moving in our favor with declining production in the u.s. >> also earlier this morning, an
iraqi official told a state newspaper that opec and non-opec oil exporters plan to meet in moscow on march 20th to discuss an output freeze. at least they're meeting is what some of the bulls might say. >> we'll see if anything comes out of it. jeff gundlach predicts those assets will struggle in sympathy with oil, calling crude the key to everything. >> i know there's a lot of belief right now in risk markets. i think risk markets now have a very poor risk-reward setup. if we use the stock market as a proxy, it seems to me that the s&p 500 maybe has 2% of upside and probably 20% of downside for a 10-to-1 risk-reward ratio. >> last week he said double line was planning on closing out some of its stocks purchased in february. he suggests unless oil rallies another $10 a barrel or more, in his words, a lot of companies
are going to go under, which will kill the banking system. on gold, he predicts prices will continue to rise and hit $1400 an ounce. gold prices today, let's have a look. just below flat. he's calling for 1400. we've seen resistance. every time we got closer to 1300, we haven't managed to push through it. generally quite bearish comments. >> and he characterizes what we've seen over the last three weeks, which the s&p has rallied, as a classic bear market rally, which is an interesting question, given we are at the seven-year anniversary from the market bottom. it was our very own mark haines who said it's feeling like a bottom. bam, since then, the s&p up nearly 200%. >> nasdaq up more than that. >> and this is one of the longest bull markets in history.
the question we're faced with today, is this past rally, this bounceback from the mid-february lows, was that a bear market rally or was that a continuation of the seven-year running bull market that we've been seeing and what we saw earlier in the year is just a setback and a correction. i think there's a huge debate on wall street. >> there's a big debate, but the seven-year anniversary for me brings back one key point to focus on. seven years is a long time. 192% for the s&p is a big move. we've had extraordinary support from central banks through that. i don't think any investor would argue that's been the main cause for this rally. that's coming to an end, whether by design in the fed's eyes or because of lack of ability in japan or europe. yet, we're only looking at 1.8 versus 2.2% growth in the developed world. it just doesn't support this. >> margins peaking. you could argue that. then again, we had dipped so far
down during the great recession and the financial crisis. what's interesting about the next move higher is a lot of folks are saying it's still on the central banks. now it's not on what they can do but on how the markets will react to them. today we get word from the bank of canada. a lot of people look at canada and say it's the next one to have negative rates. tomorrow, a very widely anticipated european central bank meeting where the reaction may be more key than the packages mario draghi delivers. next week, the federal reserve and bank of japan. central banks are still in charge. the question is, will the market have the same reaction it did over the past seven years of this bull market rally, which has been positive to central bank easing. >> which i think the most recent bank of japan easing would show that's not the case. >> maybe not. maybe they're losing their faith. >> mario draghi of course the focus tomorrow. >> all right. it is another light day for data with most little second-tier reports on tap. we're talking about january wholesale trade. that's out at 10:00 a.m. eastern time. inventories could shed some light on just how much of a drag they'll be on first-quarter gdp.
the revised q-4 gdp showed companies made less progress than thought in reducing excess invento inventory. look for earnings before the bell from retailer express and home builder hovnanian. after the close, we get it from box and square. two of the more recent ipos. also an exclusive interview later on cnbc with the ceo of square and twitter, jack dorsey. >> one not to miss. stocks to watch today, valeant will assign new board members. takata has enlisted restructuring lawyers. general motors disclosing that shareholders will be allowed to nominate directors to the board but only if they hold at least a 3% stake in the firm.
str separately, the automaker hiked its dividend. shares flat in premarket. >> speaking of dividend, general mills naming kimberly clark to its board, saying thaul hike their dividend to 46 cents a share. cannon is set to buy toshiba's medical unit. and lockheed martin is looking to cut up to 1,000 jobs. that will impact its aeronautics division. still to come, an exclusive interview with china's vice finance minister. a rare look inside the chinese government. that's coming up. >> first, as we head to break, we want to hear from you. our twitter and facebook question this morning, the seventh anniversary of the bull market, s&p up nearly 200% since march 9th, 2009. has the bull run its course, yes or no? we'll share the results later on in the show. we'll be right back. friends coming over?
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welcome back to "worldwide exchange." let's get you up to speed on the market action. yesterday u.s. equities broke their five-day winning streak and saw declines. today we're expected to bounce back slightly. we're looking at 70 points positive open for the dow. around about eight for the s&p. the nasdaq by about 20 points. taking some leads from european trade, as you can see. gains across the board there. not too pronounced. similar-size moves. up 0.6% on continental europe.
so we're following europe's positive market. >> speaking of europe, to today's trade of the day. investors are expecting the ecb president marco draghi to announce more stimulus tomorrow. is there a way to trade the central bank move? our data team looked at which securities historically perform well and which don't after draghi speaks about more monetary policy easing. turns out they found the germany and japan etf both rallied among others. the etfs that did poorly were energy and gold related. for more, go to cnbc.com and check out cnbc pro. >> just a slight rate cut, i think, would disappoint the market in terms of the amount of easing they're expecting. >> they're expecting more qe, right. >> we need to see an increase in the bond buying, possibly a tweak of what they're buying. >> that's the question. i've seen so many different bank notes on this. could they actually dip into the market and buy bank shares?
>> i don't think they'll do that or buy bank bonds. some people are arguing they should be buying npl stock specifically. that would take a lot to happen. if he just does a small five or ten basis point cut and nothing else, i think that wouldn't be enough easing for what the market is expecting. if he increases just the size of what they're buying at the moment, that would be enough. >> tomorrow is going to be fun. the euro is going to be the tell. global market still keenly focused on the health of the chinese economy. our eunice yun sitting down with a rare and exclusive interview with china's vice finance minister. she joins us with the highlights. >> thanks so much, sara. the chinese vice finance minister was joining the chorus of chinese leaders trying to reassure investors that china shouldn't be a source of anxiety for global markets. he told me today that the chinese leadership has the
economy and the slowdown well under control. he also said that it's very important that people understand that the chinese leaders here will be able to reach their target of 6.5% to 7% for 2016 and 6.5% every year thereafter until 2020. but he also pointed out that the leadership understands the need for reform. he said as evidence of that, they have already been tackling industrial overcapacity. he also said that he's hoping that global investors will understand that china is really making an effort to communicate more with the rest of the world. this is what he had to say. >> the premier gave very, very clear instruction to chinese officials that it must enhance the communication with people.
we still have many things to continue to improve. >> so he said that he got that message from on high and he hopes to see more face-to-face meetings between chinese officials and the media. he also was talking a lot about some of the biggest issues that the economy faces, such as rising debt. i was asking him, because by many estimates, china's gdp faces a debt level that is at 250% of gdp. i asked him if that's a concern to him. he said that the chinese leadership is well aware of the debt challenges and that they will make every effort to try to prevent any financial risk. guys? >> eunice, thank you very much for that. saying they have to improve communication. >> and that's the key. the fact that even china's vice finance minister spoke to our
eunice yun. at least they're talking. that has been a big part of the problem. >> i wouldn't write off any more surprises at some point this year though. >> just watch the yuan. it weakened for a second day in a row. >> third day. i think this is still something they have got control on. so minor moves now are slightly less important than they were back at the start of the year. coming up, decision 2016. we'll bring you the results from four presidential nominating contesting, including a big win for bernie last night. speaking of washington, good news for visitors to the nation's capital. this year, warmer temperatures are causing cherry blossoms to bloom earlier than expected. that's wonderful. >> have you seen it? we have to go. >> i'm definitely going. can't wait to get to washington. the national park service now predicts the trees could bloom between march 18th and march 28th. >> as for the rest of the nation, it's warm here in new york city. here's today's weather forecast from the weather channel's
reynolds wolf. >> hi, sara and wilfred. here's a look at the forecast around the country. the big trouble spot we have is in parts of the southern plains along the gulf coast. a good chance of showers, storms, maybe tornadic activity. even chances of flooding into mississippi and arkansas before all is said and done. in terms of temperatures, very mild conditions along the eastern seaboard. new york, only 74 degrees. atlanta, georgia, also with its springtime warmth. but there's still a touch of winter back on the map. make your way back to the west to see that, especially into parts of the rockies and cascades. all right, folks. you're watching cnbc. see you on the other side of this commercial break.
welcome back to "worldwide exchange." if you're just waking up, let's get you up to speed on today's market action. looks like we're going to reverse yesterday's day of declines. s&p futures up seven. dow futures up about 60. nasdaq futures up 14. we did fall from two-month highs yesterday. in fact, stocks fell by the most in several weeks. let's show you part of the trigger for the gains over in europe and in the u.s. that would be the price of oil. yesterday falling almost 4%. today back on the rise. wti crude just crossed over $37 a barrel. racing higher, up 1.5%. >> sara, thank you very much for that. let's get to the race for the white house.
donald trump and hillary clinton have a bigger delegate count this morning. tracie potts reports for us live from washington. tracie? >> reporter: hey, good morning. hillary clinton has the bigger delegate count, but the big story today is the fact that bernie sanders won michigan, a state that clinton was predicted to take. the big question had been, could sanders win a state with a large minority population. now we know the answer is yes. >> frankly, we believe that our strongest areas are yet to happen. >> reporter: bernie sanders with new confidence after an unexpected win in michigan. thank you, he tweeted early this morning. the polls were wrong, even sanders didn't see it coming. he won with nearly a third of the black vote. >> hello, cleveland. hello, ohio. >> reporter: hillary clinton didn't mention her mississippi win or michigan loss last night. she picked up more delegates than sanders. our new poll shows she beat donald trump by 13 points in
november. >> only one person did well tonight, donald trump. >> reporter: trump won michigan, mississippi, and as of this morning, hawaii. >> we started with a field of 17. now we're down to four. i really want to close things out. >> reporter: he's hoping to do that in florida tuesday with ted cruz closing in on delegates. cruz won idaho tuesday. >> we know that we're closing the gap in state after state after state. >> reporter: florida could be it for marco rubio. his best finish on tuesday, third. >> i need everyone's vote right now, okay? let's not get into that. i can't lose any votes. >> reporter: john kasich still insist he will win ohio. but now it's looking more and more like a two-man race between donald trump and ted cruz. our new poll found that six in ten voters say they think that trump is hurting the party, yet trump continues to win. >> absolutely, tracie. my question is, as we try to game out the scenarios, a lot of people still talking about this idea, the contested convention.
if trump can't get the right amount of delegates, who at this point looks like the better pick for the establishment? is it kasich or rubio? given kasich's recent performance and rubio's recent losing performance. >> reporter: good point. and that is probably going to depend largely on what happens on tuesday. if rubio can't win florida, if he can't win his home state, he may not even be in it at the convention. he may be out of it at that point. if kasich can't win ohio, same deal. if he does win ohio, even if he goes into the convention with very few delegates and they get to a contested point, he could certainly be a viable option for republicans who don't want donald trump to be their representative, which according to the polls is a significant number of people. >> ohio and florida next tuesday? >> reporter: yes, both of them. >> that'll be important. >> tracie, thank you for that. i wonder if mr. bloomberg is looking at this thinking i threw in the towel too early with
sanders' victory. >> she still has the delegate lead. it was an upset. she more than made up for it in mississippi. people don't actually think that it means that she's not going to get the nomination at this point. >> a lot still to come on this story that just keeps on giving. changing tack to the world of music. george martin, the legendary produce er who with guided the beatles has died. often referred to as the fifth beatle, he produced some of the most popular album of modern times. martin won six grammys, was knighted in 1996, and inducted into the rock and roll hall of fame in 1999. in 1963, a martin recording topped the british charts for 37 straight weeks. he also worked on several of paul mccartney's solo albums as well as with celine dion and
elton john. 90 years old. british legend. >> the tweets are pouring in. including one of the first from ringo starr. peace and love to judy and his family. i did not know "hey jude" was your favorite beatles song. i'm not surprised. you're the ultimate cheeseball. >> don't tell everyone. >> mine is "come together." >> it's the most catchy, "hey jude." all right. moving on to other news. china is set to overtake the u.s. as the world's biggest movie market, but there are questions about how many people are actually in the theater seats. the top draw at the box office this past weekend was a martial arts movie starring mike tyson. however, chinese investigators are looking into whether sales were boosted by so-called ghost screenings. that's a practice used by chinese companies to get a leg up on foreign studios. >> mike tyson's in a kung-fu
movie. didn't know that. >> you might have to go to china to find out. >> i want to see it. when we come back, this morning's top stories, plus wall street marking the start of the eighth year of the bull market today. check out these stats. since march 9th, 2009, the best performing sector is consumer discretionary. the worst performing sector is energy, and it still managed to gain 43%. >> and that takes us to our twitter and facebook question of the day. the seventh anniversary of the bull market. the s&p up 193% since march 9, 2009. has the bull market run its course? get in touch with us. vote on our twitter poll, and we'll bring you the results and much more analysis coming up on "worldwide exchange." looking for 24/7 digestive support?
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good morning. wall street marks the seventh anniversary of the bull market, but have stocks run their course? the bull/bear debate straight ahead. more trouble for chipotle. details on another scare at a massachusetts restaurant. and out of this world. jeff bezos wants to take you to space and sooner than you might think. it's wednesday, march 9th, 2016. you're watching "worldwide exchange" on cnbc. >> good morning and welcome to "worldwide exchange" on cnbc. i'm sara ooeisen. >> and i'm wilfred frost. futures pointing to a positive
open. we're following the lead of what's going on in europe. of course, yesterday we snapped our five-day winning streak. we're due to bounce back a bit. the dow futures had been expected to open up 80 points. now 50 points. let's have a look at europe, where gains are across the board. again, a muted fashion. the ftse 100 bang-on flat. italy up a nice 1%. let's have a look at asia as well. we've seen some softness particularly in china. still really reacting to the trade data we saw yesterday as opposed to anything really new overnight. shanghai comp down 1.3%. the nikkei down 0.8%. oil has been important over the last couple weeks. televisi it was important yesterday. >> it's the correlations that matter a lot this year. while we seem to have broken our correlation with the chinese market, oil seems very much
alive with a 1% gain today. looks like u.s. and europe are rallying on the back of that despite those losses in asia. >> absolutely right. i think oil has been crucial over the last couple weeks. yesterday, interesting to see that oil snapped down a little after that goldman's bearish note and jeff gundlach being relatively bearish. >> he was bear uish on the stoc market too. he's had a lot of right calls, though not as many on equities. more on bonds and oil. >> but he's got that market sentiment pretty right over the last six months. that's been the biggest mover for all stocks, whether or not they have individual stories to talk about. >> blackrock saying stocks could go up 5% to 10% despite what he sees as a slowing economy. rieder also telling cnbc with the fed looking to raise rates this year, it may be time to get
back into some assets such as high yield and emerging markets. have a listen. >> listen, this is a fad that's moving towards raising rates. i think vice chair fischer was clear about that. we think it's going to be pretty hard slash probably impossible for them to move in march. i think they're going to move into june. i think we're going to learn more about how many times they're expected to move. probably three times this year. i think it's probably going to be one to two times they're ultimately able to move. >> rieder also says it's not out of the question that the fed resorts to quantitative easing if they have to at some point. fed meeting next week. it used to be that march was expected to raise interest rates. now the market is not pricing it in and nobody is really expecting it. though, the commentary, especially on inflation, which is starting to creep higher, will be important to see whether they have to game it out later in the year. >> nobody's expecting it, but just the last couple of weeks of data have allowed maybe 10% of people to expect it. it was written off three weeks ago. >> and the odds for june and december go higher as well.
>> we'll have to wait and see. first of all, don't take the attention away from mario. >> mario is everything tomorrow. >> absolutely. >> today it's canada. >> right. corporate news. hedge fund manager whitney tillson is shorting lumber liquidators. last year he accused the flooring retailer of selling flooring laced with cancer causing materials. now he says the risk is bigger than he thought. >> the last four quarter, ever since the story aired, has really fallen off a cliff. they're losing $20 million to $30 million a quarter. same-store sales are deep into negative double-digit territory. i sort of figured once they started to lap the "60 minutes" airing march 1st of a year ago, they might start to show some year-over-year gains. i now believe that the business has gone from worse to truly horrific. >> shares dropping on his comments yesterday. though, they're up a bit this morning, as you can see. about 1% recovering a little
bit. lumber liquidators responding, saying mr. tilson has elected to create confusion in the marketplace for the purpose of making money by lowering our stock price. we're confident we have the right team and plan in place to move forward into the next phase of the company's growth and success. >> a chipotle restaurant north of boston has been shut down after a few employees became ill and at least one had a case of norovirus. no reports of any customers getting sick, but the restaurant is being cleaned and disinfected. health officials will determine whether it requecan reopen in december. the bad news for chipotle keeps coming. meantime, google is announcing a major upgrade to how you can browse and book vacations. google wants to become the platform to which people naturally turn to do that. what will it mean for an already competitive space with priceline
and expedia? simon hobbs making his "worldwide exchange" debut. good morning, simon. tell us what google is trying to do. >> good morning to you early birds. it's actually been available. it's on the google search bar, which is important. they've changed the way they do things. just go to the google search bar and put in a continent or a city or a state. you could put in ohio destinations or europe destinations. you'll begin to see first two destinations, like a photograph of them. then if you press the arrow, the blue arrow, more appear. what they're doing behind each of those destinations is they're pulling together the vast data feeds they have to give you, for example, the best time to go, the average price, what the weather will be like. there will be videos courtesy of youtube. you can cap your search according to your budget. the idea is that google wants to be the natural place to which people go to browse for holidays and ultimately then of course to purchase travel items. the question, the important
question is what does that mean for priceline and expedia, multibillion dollar operations already in that space. of course, this is basically an aggregator. they call it meta search in the industry. you've already seen that with trivago. the important thing to realize here is that google only really wants to connect your qualified lead. it wants to kind of funnel you into a position where it knows what hotel you might buy on what date and where, and then essentially in realtime, it puts that up for bidding. who bids for that? well, the likes of priceline and expedia. so it's a funneling effort for google. but google, of course, has been the elephant in the room, as you know, for a very long time. whilst this might seem in a consumer sense like a nice thing to be able to do, the potential profitability of what they're doing here and the way they could change how people search and therefore the billions of dollars of capitalization within that industry is absolutely huge, as you'll be aware. >> do we think this is something that the airlines and hotel
industries welcome, or are they going to have to give concessions in terms of pricing because google usually when it enters spaces like this becomes so powerful? >> it's a really interesting question. i mean, for the airlines, the airlines have done this search really well. they basically set up orbitz. airlines pay very little commission at the moment. hotels pay huge commission. they might pay up to 20% of a room rate in order to sell it. and if we go back down into recession, that will become more and more acute. i think the question really is whether the hotels will stomach the hotel brands rather than the online travel agency. if i own a hotel, am i going to pay hilton or marriott 12% of my income to run my hotel and run the brand and then 10% or 20% for that online travel agency to actually sell it online. the big debate for this year is whether the hotel brands see their position deteriorate. that's why you see hotel brands
increasingly. you see it with hilton advertising direct to the consumer to knock out priceline, expedia, and now google. that's really where the cutting edge of the industry is, guys. >> simon, thank you very much for getting up early with us. can i just say, what a beautifully delivered, pronounced, wonderful accent hit that was. >> i've done it for some time. >> it's the british accent. >> i'm surrounded on all sides. see you at 10:00, simon. >> a rose between thorns. >> thank you. jeff bezos announcing plans for his space company to begin passenger flights by 2018. this is the first time that bezos has put a target on the start date of commercial flights. he's aiming to use test pilots by next year and to start paying astronauts by 2018. the company also expects to build six new vehicles. no word yet on what tickets will cost. bezos saying it will be competitive with richard branson's virgin galactic. the race for space. and to actually bring people. how crazy.
>> would you go? >> i don't know. i think it's scary. >> it is pretty scary. i think we'd have to do it. >> if jeff bezos says it's safe. >> we have to do it. she's been a fashion model, teacher, pilot, flight attend t attendant, and an ambassador for world peace. today she's also a birthday girl. it's national barbie day. the mattel doll was first introduced on this day in 1959. her full name is barbara militant robert. she's had an on-again, off-again relationship with her boyfriend ken carson. when is ken's birthday? do we celebrate that as well? >> no idea. this is a 50-year relationship strong. >> it's estimated more than a barbie dolls have been sold worldwide. last month mattel sales rose 1%. in january, they announced
barbie would be getting three new body sizes to address concerns her traditional slim and blond look is losing appeal with children. there we go. again, no celebration of ken's birthday and no new ken dolls. >> happy birthday, barbie. a very important doll, person, in my life growing up. >> and -- no. >> not in yours. now for today's trending stories. we start with zika. an update here. mosquito eating fish are the newest weapon against the virus. a nonprofit called operation blessing is distributing fish that eat mosquito larva before the insects mature. the same group used these fish to avert a west nile outbreak after hurricane katrina. i guess good news there's some hope in fighting this. >> although, still spreading. 50 cent is appearing in court today to explain an instagram photo that shows the word "broke" spelled out in stacks of cash. the rapper filed for bankruptcy protection last year and is claiming the bills were all fake. really pointless post there.
and residents of rome can now order a priest on demand. the new app scooter and amen delivers a clergyman on a scooter that lets you rate the priest from one to five angels. clearly this is a marketing stunt. >> this is extraordinary. >> and hilarious. >> only in the vatican. only in rome. i wonder if it'll catch on. i suppose it could catch on here, certain areas of the u.s. potentially. >> i don't know. catholic church getting creative. still to come, today's must reads, including why there could be one person who may be able to trump trump. stay tuned. you're watching "worldwide exchange" on cnbc.
welcome back to "worldwide exchange." now to today's must reads. the stories catching our attention. i picked "new york times." tom friedman writes, only trump can trump trump. he writes, trump's other joker and what can stop him are those attracted to racism. they may go too far and do something ugly. he goes into a pretty scathing attack, i would say, on the republican party in the history of who it's backed and some of the values it's backed that led to the trump phenomenon. then goes into what could stop trump and concludes that it's
only trump himself with examples like this one, but then friedman also says don't bet on it necessarily because the trump momentum continues to gain, and the supports are feeling their gut and not their mind, which is why never trump and some of the opposition of trump aren't going to be successful. >> i think very true as well for the race for the republican nomination. but things will change a lot once we get through that stage. there's lots of other factors that could come into play. it's an interesting take in terms of the rest of this republican nomination. >> we'll see what happens on tuesday. florida and ohio. we're approaching the top of the hour. that means the team is getting ready for "squawk box." becky quick joins us from new york with a look at what's coming up. good morning, becky. i'm sure you have a lot to talk about with the seven-year bull market anniversary. >> yes, exactly. we have a lot to talk about. i know you've been talking about the markets all morning and what happened yesterday with the transport sector. dow transports down by 2.7%, the
worst performance they've seen in a month. you can thank oil prices for that. mike santoli is here. he's going to talk about that relationship between oil and stocks, what's happening right now. also, as you mentioned, we'll be talking about the politics, how everything played out last night. we have eric kantcan cann -- ca joining us. donald trump looks unstoppable at this point. we have a special guest host. two hours with jack welch. we'll talk politics, business, and we'll get to talk what he's seeing in private equity, get a feel for the economy. we've got it all coming up. it's just about 13 minutes away at the top of the hour. wilfred and sara, back to you. >> and becky quick, final question for us. sad news today, the passing of sir george moartin. what's your favorite beatles song? >> there'ses so many. i heard them playing "i want to
hold your hand" this morning. i believe that's one sir george was involved with. i think i'd probably lean a little more towards the later '70s. towards the early '70s, some of the music they were playing then. "octopus' garden" comes to mind. "lucy in the sky with diamonds." depends on the mood and what's going on. there are so many good ones. >> you said it right. becky, thanks very hutch. "squawk box" coming up in 12 minutes' time. first, can the major averages keep chugging? we'll get you caught up on the markets with morgan stanley. but first, our twitter question of the day. has the bull market run its course? we'll read the results next.
morning. the moon blacked out the sun over indonesia. the eclipse is also partially visible in singapore, hawaii, and northern australia. very nice. i didn't even know this was happening. glorious. right. let's get back to rkt mas. we snapped the five-day winning streak yesterday. joining us to discuss, daniel skelly of morgan stanley. thanks for joining us. yesterday, as i mentioned, we snapped that five-day winning streak. goldman sachs saying the recent rally will lose steam. what's your view? is it a one-day correction yesterday, or has that rally since jamie dimon came out and bought his own stock, has that run its course? >> good morning and thanks for having me on. we think there could be more room for upside from here. granted, we've had a nice 7%, 8% move off the lows. frankly, things will probably remain volatile, however. that's because the two major transitions going on globally are still in place.
the first being the u.s. policy transition. we're seeing obviously a six-year, seven-year period of easing, moving into a period where we're focused on the fed's rate path and what they're going to do with interest rates. it's unlikely we're going to have 100% certainty in the near term on that factor. secondly, more globally, we're seeing this long duration transition in terms of china's move from an export infrastructure-led economy to a consumer economy. and along the way, we're going to hear all different types of positive and negative updates related to that massive transition. so given those two transitions going on, things are going to remain volatile. that being said, coming back to my earlier point, we had negative at six, seven-year lows in the last couple weeks. we've had this nice rally off those lows. we could continue to see some room to run here. >> which sectors in particular are you looking for the strength? is it going to be the defensive
utilities, consumer staples, the ones that pay the dividends, or actual growth stocks? >> yeah, sure. so i think on that point, you want to have a bit of both. frankly, the reason for that is given all the volatility, you're going to want to have some yield and some balance in the portfolio. some sectors in stocks that will deliver on earnings, achievability. on the other hand, if you take a longer term view, you look at certain sectors like the financial sector, the banks, some of the asset managers, and they're trading at very, very cheap valuations. valuation in the short run means nothing, as we all know. we've seen different examples of that. in the long run, however, valuation is very important. if you have a longer term horizon, i think there's some definite opportunities in financials, including banks and asset managers. >> so daniel, that's some of the kind of higher plays in terms of if you have a view of market positivity to come. what if you're cautious? how are you structuring your
portfolios to offset those positions? what is the key thing to buy? is it gold, terrreasuries? >> i think you want to play it through some of the more defensive equity sectors. gold has had a massive move here. it's starting to act more as a currency in and of itself. we haven't seen a tremendous run away inflation. so usually gold acting as a hedge against inflation isn't typically playing out this time. in terms of treasuries, we're looking at fairly rich valuations on that perspective. we wouldn't want to be overboard in terms of our allocation there. if you do see some continued stabilization in the equity market, the one area that's starting to act better in fixed income is high yield. obviously you need to be selective within this asset class. there are certain miners and energy related plays at risk given the credit cycle. but other parts of high yield are certainly more attractive here. >> on your bullish thesis, i did hear you say that part of it has to do with the fact that global
central banks are still easing. that has certainly been one of the hallmarks of the bull market. the question now is, do they still have the ammunition, and are investors still cheered by easing? because there have been some really serious questions about investors' faith in monetary policy. are you not concerned about that? >> yeah, no, it's a fair point. it's definitely something to monitor, particularly as we look at different developments going on with regard to overseas monetary policy. you've seen a very accommodative, aggressive bank of japan in terms of their liquidity program. we're expecting further easing from the central bank in europe and draghi. i think key to that would be any initiatives to buy corporate kret. when you look back at the u.s. stimulus programs over the last six or seven years out of our federal reserve, it was really when the fed got more involved in buying the mbs, the mortgage-backed securities, and some of the housing related debt that did have a higher correlation with higher stock
prices. if you see that corporate credit initiative from draghi, that could actually be a boon to european stock prices. >> daniel, thank you so much for joining us this morning. much appreciated. daniel skelly of morgan stanley wealth management. only about a minute left. what do you want to focus on today? >> i'll be watching the biotech stocks for a change. we haven't talked about it a lot, but the biotech etf yesterday had its worst day since early january. a lot of the hot air has been coming out of this trade. yesterday was sort of a déjà vu moment with energy and banks leading the charge lower and a lot of these high momentum growth stocks that daniel actually likes at morgan stanley got slammed. so if this market and this bull market can continue to run up, will the same growth leaders like biotech go there. >> and i'm watching oil prices. sounds repetitive, but it's been crucial. >> that's the key. >> very quickly, the result of our twitter question.
has the bull market run its course? 54% of you say yes. that is it, though. "squawk box" coming next. friends coming over? yeah, so? it stinks in here. you've got to wash this whole room are you kidding? wash it? let's wash it with febreze. for all the things you can't wash, use... ...febreze fabric refresher whoa hey mrs. webber inhales hey, it smells nice in here and try pluggable febreze... ...to continuously eliminate odors for... ...up to 45 days of freshness pluggable febreze and fabric refresher... ...[inhale + exhale mnemonic]... ...two more ways to breathe happy
good morning. big upset in the democratic race. michigan voters feeling the burn. as for the republicans, donald trump adding michigan, mississippi, and hawaii to the win column. happy seventh birthday to the ageing bull market. u.s. equity futures getting a boost this morning and oil prices rebounding from yesterday's losses. plus, four basketball teams punching their ticket to the ncaa tournament last night. this is all about fairly dickinson. they have a team. they beat wagner, which is a school somewhere apparently.
we're going to tell you who's going to the big dance. it's wednesday, march 9th, 2016. "squawk box" begins right now. live from new york, where business never sleeps, this is "squawk box." good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen. andrew is off for the day. sitting in with us for the hour is mike santoli. it's great to see you this morning. let's take a look at the u.s. equity futures this morning. after the market gave back some ground yesterday, we are looking at positive territory this morning. dow futures indicated up by 83 points this morning. s&p futures up by about ten. the nasdaq up by 23. overnight in asia, you'll see that the nikkei was down by just over 0.8%. the hang seng was flat. the shanghaiom