tv Worldwide Exchange CNBC April 4, 2016 5:00am-6:01am EDT
good morning. corruption scandal. a massive leak of 11 million documents reveals how some of the world's richest people hide billions in offshore accounts. among them, associates with ties to russian president vladimir putin. business in the fast lane. tesla tops $10 billion in model 3 orders in just 36 hours. and decision 2016. new this morning -- the latest poll shows ted cruz lead donald trump in tomorrow's wisconsin primary, this as both men's campaign work to keep rival john kasich off the ballot at the rnc. it's monday, april 4th, 2016,
"worldwide exchange" begins right now. ♪ a very good morning, and a warm welcome to "worldwide exchange" on cnbc. i'm wilfred frost, joined society by seema mody sitting in for sara eisen. >> excited to be here. >> let's get to u.s. futures, of course following last week six weeks out of seven, s&p and the dow finishing at their highest point for the year thus far. they're expected to extend the gains but only b 3 points dow b nasdaq by 12. let's have a look at the u.s. ten-years. quite a bit of movement on friday as that nfp number came out 1.6%. much higher than the low.
it's highlighting the level of input that janet yellen and the fed has had on the recent equity market rally. >> absolutely. that u.s. jobs report impacting global market sentiment as well. if you take a look at european markets this morning, a mixed day of trade that's slightly higher coming off the lows of the session. german dax, .3%. telecom is the worst performing sector in europe this morning. if you take a look at asia, japanese stocks and the focus down .25%. the chinese market is closed today for a public holiday. keep in mind, china now manufacturing pmi data. >> do you know what the public holiday is in china? >> no. >> tombstone sweeping day. >> what is that? >> i don't know. the market is closed.
hong kong closed as well, as well as taiwan. the broader markets, oil prices they are slipping a little bit. keep in mind, we have been pretty resilient. staying below, 36.7, perhaps this could spark a wider sale. only a .6% decline. but we are moving away from the 40 level. let's have a look at the dollar as well. not too much happening there today. relatively muted. but we've got a bit of a move against the euros. you can see 11373. and the aussie dollar off. the biggest move. the dollar backed off against the uyan.
investors have been really transfixed by the move in shiny yellow metal is it a by-product or signs of a riskier market? >> absolutely. i think you've got to take that with the stock rally that we have, the bounceback in stocks to see it's not just unreserved -- it's unreserved risk on sentiment because we've seen the move up in gold as well. as i mentioned earlier, the u.s. treasury move highlighting the fact that the fed is at play here. it's not really reacting to positive data. yes, we've had a bounceback, yes week at highs, all time for the year, dow and s&p closing at the highest point on friday. >> absolutely, still remarkable rebound in the u.s. equity markets. and economic data this week will be in focus. a slow week today, look for february factory orders at 10:00 a.m. eastern tuesday. it's the february trade deficit and march ides index.
on thursday, it's about weekly jobless claims. among today's top stories an anonymous leak of 11 million documents from a panama-based law firm. the firm specializes on shell firms. findings were led by the national society of investigative journalists. the so-called panama papers are four decades worth of money havens. current world leaders, politician, sports stars and other celebrities are named in the documents. they detail a $1 billion money laundering ring run by russian-backed tied to associates of vladimir putin. and it shows companies in egypt, libya's former leader gadhafi and bashar al assad. now, deals you need to keep
an eye on, alaska air is reportedly marrying an agreement to buy virgin america by $2 billion beating out a deal by jetblue airways. an announcement could come as early as today. virgin america which has had a great run over the past two weeks on this buyout speculation up by about 31%. you can see if this comes together. tesla has orders for its lower priced model 3 electric sedan. 270,000 in the first 36 hours. if each car is actually delivered that would mean more than $10 billion in revenue for tesla up 3% in premarket trade. update in the proposed mergers between staples sand office depot. staples has offered to freeze prices for three years. time inc. is considered to take on the private ector firm yahoo!
and "time" looks to boost its digital business. a macao court has ruled that a former business partner can seek billions of dollars for break the deal of their partnership. and executives at halliburton are making a last itch effort to save the bake hughr hughes deal. they're close to blocking the merger. and sunedison prepared to file for bankruptcy protection soon, according to "wall street journal." a loan for fund its operations while it seeks chapter 11 protection, this sums as sunedison is buried in debt due to an aggressive acquisition strategy. ting worse for bill ackman, the billionaire investor lost 7% last now.
it continues to tumble after cutting its financial forecast. also said it could face a default if it fail as to file its annual report. that leaves square to a 24% loss for the year according to reports. coming up on "worldwide exchange" -- a live report from europe where a new week of trading is officially under way. first, we'd like to hear from you, our twitter and facebook question this morning, donald trump says he sees the u.s. head for a very massive recession. do you agree? stay tuned. you're watching "worldwide exchange." millions look to you for advice. i know... i can't believe it. i am learning to analyze social media to spot trends and predict demand. sounds like you spend a lot of time online? i constantly absorb online content to follow shifts in pop culture. so... you're learning to think like a teenager? yes. how am i doing?
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comcast business. built for business. welcome back to "worldwide exchange." a very good morning to you. let's get you up to speed on the markets. u.s. futures or on the gain. a gain of 1.1%. the dow expected to open by about 25 points of course this follows a nice finish on wall street on friday, after the jobs numbers was taken positively. we've ended the s&p at the highest point for the year. let's look in on oil prices because a different signal coming in from there. slightly bearish. again, slight declines. 36.5 for wti. we're pulling away from that 40 level. we've been resilient in the 37s, 39s in the last few weeks.
seema. >> now to the early trading picture in europe, we're joined by louisa bojesen joining us live from london. louisa, it is great to see you. get us up to speed. what should we be watching in europe today? >> good morning. good morning. we're flattish to a little bit higher as seen behind me on this lovely markets map. the ftse hanging on to slight gains. having bucked the trend early on. the cac on and one of the biggest stories have to do with 11 million stret files that have been leaked how basically rich people how they find tax havens. there's a lot of controversy surrounding this particular report, whether it's on the report that the law firm saying they haven't done anything wrong. they're helping people to find the loopholes and you need to look closer at the overall taxing system, if you want to, to make sure rules change in the longer term. that's the bigger story out there. apart from that, one of the
bigger issues we're looking at with sectors has to do with the telecom sector. this particular sector off shy of 1%. underperforming because we had a very big deal fall through. tieup talks between orange and bouygues in france have collapsed. telecom shares in paris and elsewhere sharply lower. orange have been looking to buy their french rival for 10 billion euros. and groups like india they would have taken on some of bouygues' assets. they've been suffering heavily as well. you see here on the screen, we're down somewhere in the region of 14% for a number of players. orange speaking to an analyst said there's still a lot of value to be found in this particular stock. that's why we're seeing it trading a little bit less down where the others are. guys, back to you. >> louisa, thank you for that. deutsche bank is fall to
third from fifth. citigroup and bank of america are ahead of the german bang. jpmorgan and goldman sachs kept their first and second positions with the trading and euro in particular taking ahit on deutsche bank members. now, in anticipation of a potential brexit, big british firms are delaying deals. another finding from the same survey, two financial officers are in favor of staying in the european union. the survey also reporting that the june 23rd referendum representing the single biggest concern for businesses. seems like there's growing momentum behind those who say we could potentially want to leave the eu. >> i think the latest polls show the exit poll show gained a bit of ground. and it's some of the issues that cfos currently pointing to that
makes people unsure. june 23rd is the day to watch. greece has begun its new controversial program to return migrants back to turkey. the first group of 130 people were sent back across the aegean sea today. it's to put a halt to the crisis that's putting increasing strains on europe. an agreement, the eu will back turkey once the claims have been processed. that will be an important story to continue to watch, not just for humanitarian reasons but very much linked as well. focusing on grease, imf chief christine lagarde is denying that it would push greece closer to default. in a letter to the prime minister, la guard says debt talks should continue despite damage of reports of a leaked transcript of a meeting of imf officials. that report by wikileaks
suggested that imf would threaten to leave the bailout to offer more debt relief. the migrant crisis, as you just point out, political uncertainty in britain and now add to that, greece back into the spotlight. >> but it's a good point to bring up, all of those scandals -- not scandals, issues continuing. >> right. >> of course, we have u.s. forces ending at the highest of the year late last week. big bounceback in the second half. europe is down sharply. stoxx 50 over three months, down 9%. the dax is down about 4%. france is down 6%. over the last three months they haven't enjoyed as strong a bounce as u.s. equitier ises. >> and also the strengthening also of the euro which of course is welcomed to the multinationals that rely on that. still to come on "worldwide exchange" -- headlines from the campaign trail.
tomorrow is key, wisconsin primary including why donald trump is predicting a massive recession, his quote. here's the national forecast from the weather channel's kelly crass. good morning, sara and wilfred. a messy system work into the northeast. some of you are going to see snow. we've got winter visors for portions of upstate new york. for new york city. it's going to be a rain event for you, temperatures around 53 degrees. chicago, a little chilly, cloudy skies. 36 degrees, beautiful weather, though, if you're in spring break across the south, gorgeous conditions with the sunshine around and texas and the southwest as well. we're monitoring another system coming into the pacific northwest. that's giving you guys in seattle and portland a good chance of rain. really warm temperatures across the south. 76 degrees in atlanta. if only the pollen count could be lower, it would be a picture-perfect day. that's a look at your national weather.
welcome back to "worldwide exchange," everyone. if you're just waking up let's get you up to speed on the markets u.s. equities higher in trade. thanks to remarks by janet yellen, also that stronger jobs support. dow indicating up by 35 points. nasdaq by 15. the weaker dollar a big part of the rally that we've been seeing in u.s. stocks. hoping the multinationals doing business overseas.
we're looking at the dollar slightly lower across the japanese yen. the euro has been in focus, 1.13. as we take a look at oil prices, that of course has been part of the sorry. oil prices seen as a boost for u.s. stocks. it's instead dill at $36.58. wti crude, ice brent at 38. wilfy. >> politics, the presidential candidates on the trail, on the last full day before the wisconsin primary. edward lawrence joins us live from washington with latest edward. >> good morning, wilfred and sara. senator ted cruz leading donald trump 43% to 37%. with governor john kasich coming in third. on the democratic side, senator bernie sanders is holding on to a two-point lead over hillary clinton. >> bless you -- >> reporter: most of the candidates spent the weekend trying to convince voters in wisconsin to choose them. >> i'll have the three cheese
omelet. >> reporter: donald trump is at a milwaukee diner. >> we have a big surprise for you. >> reporter: before going back to the issues on a town hall on a fox news channel, trump says he's the only candidate who can make good deals for the country. >> there's total gridlock in washington. we have a president who has no control over his own party, let alone the republicans. >> reporter: the republicans winning the polls in wisconsin at the moment. senator ted cruz who says nominating trump would put hillary clinton in the white house. >> nominating donald trump would be a train wreck. and that's not fair to train wrecks. >> reporter: for the democrats, hillary clinton held events in new york. so senator bernie sanders in wisconsin set his sights on trump. >> you are looking at the strongest democratic candidate. >> reporter: sanders says only he can win the general election for the democrats. and it is the last push to try and get wisconsin voters to give the 42 republican delegates a
and 96 democratic delegates to them respectively. back to you, wilfred. >> edward, thank you for that. among the headlines, donald trump with an interview with "the washington post" saying u.s. conditions so perilous that the u.s. is head for a, quote, very massive recession. he said it's a terrible time to invest in the stock market. trump says if he's elected he plans to eliminate the nation's more than 19 trillion dollars of debt in eight years. and it's close, of course, to our hearts, have to wait to see if he gets traction off the back of that. it's pretty clear that we're headed to a recession. >> please tweet us on that. in other political news, the trump and cruz campaigns are reportedly working to prevent john kasich from appearing on the ballot at the national republican convention this summer. if no one wins the nomination during the primary process,
delegates choose from candidates on the convention ballot. msnbc reports that aides will continue to keep him off the ballot. on the democratic side, hillar hillary clinton knocking down reports that she and her group could be investigated by the fbi. >> has the fbi reached out yet to you for an interview? >> no, they haven't. you know, back in august, we made clear that i'm happy to answer any questions that anybody might have. and i stand by that. >> during the "meet the press" interview, clinton reiterated that the choice to use her e-mail was a mistake. in other news, the acclaimed american-indian historian joseph medicine crow died at the age of
102. crow was awarded the presidential medal of freedom in 2009 and served as the tribe's historian. an amtrak train headed to new york on construction equipment near philadelphia killing two track workers and wounding more than 30 passengers. amtrak said it will run regularly scheduled trains today. however there may be some delays on services between philadelphia and wilmington, delaware. more flight are arriving on time and fewer bags are being lost but consumers are still unhappy. a recent quality rating found that in 2015, the public complained at a rate not seen in 15 years. the number one source of traveler frustration, cancellations and delays. even though the number of passengers who were dumped off due to oversold flights were down 20%. >> and overbooks, people get
bumped off of flights. >> it's happened to me in new york as well. sports news. a study by ap found a major saturday risen 4.4% to merely $4.3 million. with the world series, the kansas city royals versus the new york mets. raising the world championship banner. the game came down to the ninth inning. royals to end it. royals wins 5-3. let's switch to college hoops and the women's final four, uconn taking on oregon state in one match one. the huskies dominate winning easily 80-vin. uconn remains perfect on the season and will go for their fourth straight title tuesday night. now syracuse taking on washington in the other final four matchup.
the men's team lost to north carolina on saturday. the women wouldn't follow suit. the orange beat the huskies 80-59 to advance to the first title game ever. i just want to point out, washington, oregon, where i grew up. abby wambach is apologizing to her friends, family and fans for being arrested for driving under the influence on sunday. she retired as the leading goal scorer. one of her sponsors, mini usa has pulled ads. tiger woods will be in augusta, georgia this week, but he won't be playing in the masters. woods officially ruling himself out of the first major tournament of the season as he recovers from back surgery. tiger says he still plans to attend tuesday's champions dinner. all right. coming up, this morning's top stories, joe lavorgna will join
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another rocket, moving one step closer to his out of this world travel. it's monday, april 4th, 2016. you're watching "worldwide exchange" on cnbc. ♪ a very good morning to you. welcome back to "worldwide exchange." on cnbc. i'm wilfred frost joined today by seema mody. good morning sitting in for sara eisen. let's check in on the market action. straight to your futures. of course, last week, six weeks out of seven weeks of gain for equity markets ending for for the s&p and dow, the highest point of the year, we're expected to extend those gains. only slightly. and the s&p by 41. nasdaq by 16 points. we're in the green and having to extend those gains in the last hour or so. still nothing too significant. dax up 3.6%.
and the sector suffering it is the tell low comsector after a french merger between bouygues and orange seems to have ended. and that's dragged down the broader sector with those companies down 10%. if you look at asian trade, taiwan and shanghai closed for holiday. and the nikkei pretty muted trade. australia down slightly. the aussie dollar down .7% after retail sales are disappointing. >> as for broader market, oil slightly lower in trade perhaps due to the weakness in the dollar, wti crude at 36.72. also one of the reasons u.s. stocks are higher in premarket trade, a weak quarter, and that continues to be the case here on monday. we're looking at the u.s. dollar slightly lower. the euro, as you can see 1.13 against the u.s. dollar. the euro, that has, so far, been
the trend in 2016. as we take a look at gold, that has been a big story, gold has been very happy in 2016, the rally in the month of march seeing a gain of around 6%. here on monday's session, slightly lower by .05%. >> look for trade deficits tuesday, and march ism services index. wednesday and thursday, the minutes and jobless claims. what does that mean for markets and what indeed did the nfp on friday mean for markets? joining to us discuss is joe lavorgna a contributor to cnbc. good morning to you. >> good morning. >> thanks for joining us. as we look at another highest close for the year for the s&p and dow late on friday. but at the same time, see some bond buying and see some yield compression towards the lows of
the year for u.s. bond yields. what do you take from that? is this rally based on fundamentals? or is it once again just based on central bank rhetoric? >> unfortunately, wilfred, it's based mostly on central bank rhetoric. the markets certainly got friendly use from yell hoon was extraordinarily more devilish. as you guys have been discovering, in particular commodities and oil, that's really been the trade. the problem we have is that last year, the economy in nolanal terms only grew 3%. we don't have the full data set by industry. but my guess is even if you take the energy sector out, still under 4%. so we have very, very weak top line. and here now, we enter the first quarter of the year, we've got very robust job growth but gdp looks soft. i've seen gdp growth maybe up
half a point. what that mean you've got significant margin suppression. i don't see how this could possibly be a fundamental story. more technical and central bank driven. >> would you characterize the march jobs report as the goldilocks scenario strong but not strong enough to reignite those theories? and possibly the fed raising rates three or four times in 2016? >> yes, seema, it's the type of report that yellen liked. the unemployment rate did not fall -- actually went up a tad. the job numbers were good. yes. so it would not be the exact word i would use, but, yes, sort of fit their desire. the economy is growing modestly. and the overall numbers are okay. but again, i think when you go a little deeper into the details what it implies for margins is problematic. and corporate profit margins are a leading indicator of that. the fed will take it as being a good report. i'm more worried.
>> what other areas about the u.s. economy are are you most worried about as you look more broadly at other indicators? >> sure, when we look at the economy, most investors i don't think necessarily know when you have recessions, downturn, consumer spending with 70% of the economy actually grows. it actually does not shrink in a recession. sometimes when it does like in back in '08, '09, all almost a dress depression. the problem is the 30% is largely the business side. and business balance sheets which hasn't gotten a lot of attention or as much as the household side look lousy. we have the debt to income basically out of recession readings. you've got very little top line growth and we've really relied upon central banks pushing investors into markets they're not supposed to be. it feels really good, we had this tremendous recovery. when you look at the flatness of
the yield curve and still looking at credit curves having widened this is not the stuff of a robust cycle, a cycle for that matter that has a lot of years left. we could start to date this business cycle flaps quarters. >> joe let's touch on the u.s. dollar. it's been a bit soft in recent weeks. is there a case where we don't expect such a broad move in the dollar? in particular, the leapout has been an opportunity to trade perhaps? are there any against euro to yen or the pound where you have very strong conviction which it could head? >> sure. you talk about the currency, through january of this year. from january of this year, compared to july of '14, we have one of the biggest in on record. we've come up significantly. that to me, wilfred, is largely a fed story. and the gains across most major currencies now we're seeing the opposite take place.
i'm not sure that the dollar will continue to weaken. as you know, we've got the brexit concerns in june. that's probably the reason the fed stays on hold. and if the global economy looks fragile again. in part because of the u.s., the rate of dollar slowdown will itself slow. and the dollar leveloff may even go up again. i'm not sure exactly what happens in the short term. i don't necessarily think the dollar rally is over. >> joe, thank you for joining us. the pleasure as always. alaska air is reportedly in an agreement to buy virgin america for about $2 billion beating out a bid by jetblue airways. an announcement could come as early as today. share prices reacting as you can see. virgin up 31% this morning. stocks to watch today, blackstone is buying hp enterprises indian consulting firm up to $1.4 billion.
this is the second deal for the company in india in the past few months. tesla says orders for its new lower priced model electric sedan topped 270,000 in the first 36 hours. . if each car actually delivered that would mean more than $10 billion in revenue for tesla. we're looking at the stock up 4% in premarket trade. and time inc. is said to be considering teaming up were you with a private equity firm in a bid for yahoo!'s core assets. it comes as time looks to boost its digital stock. right now time for today's trending stories. jeff bezos' blue origin space company successfully landed another rocket this weekend. it's meant to be more challenging than the previous missions because the landing happened at less than five miles per hour. this is the firm's first successful trip in four months as they're to start commercial passenger trips by 2018.
a u.s. rift of virtual reality has run into shipping issues. the ceo announcing on twitter that orders are going out slowly than estimated and the company will be covering any shipping costs for any previous orders. i hope you're not too disappointed. i know you're getting excited to put on the headset. >> i tried. kids as young as 6 years ago old are being taught to drink responsibly. it's part of a parliamentary bill teaching kids how wine ties into italian history and how to not abuse alcohol. wane tastings are part of it. >> should bring that over to the u.s. >> did you know italy is the biggest producer of wine in the world. >> interesting. on to another fun story,
chihuahua led california highway patrol officers on a spirited but briefcase across the oakland bay bridge. drivers reported seeing the dog sunday morning next to the slow lane. officers responded while the dog weaved across lanes. the dog has recovered safely. still to come, today's must reads. including a piece on whether pro-europe campaigners are losing the brexit argument. first as we head to break, we want to hear from you, our twitter and facebook question this morning. donald trump says he's seeing the u.s. headed for a, quote, massive recession. do you agree? more to come on "worldwide exchange."
welcome back to "worldwide exchange." a very good morning to you if you're just waking up. let's get you up to speed on the market action. u.s. equities pointing higher, a bit, slightly, s&p, 5.5 points. the dow by 50. nasdaq 18 points it follows similarly sized gains in europe. let's have a look at oil prices as well. they are moving slightly in the other direction. just rallied back up. basically flat, 36.8 for wti. we were down by half a percent per hour. in the oil market over the last hour or so. right get to today's must read stories. a quirky one from me in the
financial times titled "fintech: dress up." gi the emergence of fintech has exposed one clear feature of the financial intermediatation. this is just another view that says banks probably slightly better protected than, say, the transport sector was versus uber or other likes. highlighting the banks make more than half of their revenue from lending. and so far, it really has not eased into that. transaction services but not so much the core banking. interesting take by fintech. >> it has an ongoing debate on whether fintech will disrupt traditional banks. especially when you look at
venture capital investing, a lot of these firms are investing in fintech. so far in 2016 that is the top sector that has gotten the most funding on the prospect or hope they can disrupt that. >> bank's earning season kicking off in ten days' time. my must read is also in "financial times." it's titled "britain's pro-europe campaigners are losing the arguments." what i found interesting about the june 23rd referendum which some people aren't talking as much, what happens to david cameron if in fact britain votes to leave the eu. he is likely to step down. who would be next, jeremy clober of the labor party. >> it would definitely remain the conservative party. you would get a change of leadership within the conservative party. the likes of george osborne,
they're leading candidates if cameron would step down. he, of course, maintains that he won't resign. although if we voted britain to leave the european union, it would be huge pressure. >> one year back, the idea that it came up, it seemed like an outrageous idea, now fast forward a year, there does seem to be momentum behind those who feel that definitely from the eu that britain would be better off. and it's also had a significant impact on financial markets especially when you look at sterling, the weak answer thnes we've seen in the pound is absolutely significant. >> late last week, britain's current is negative. plus the prospect of the weaker pound. also we'll keep an eye on sterling. still to come, ed keon gives his
welcome back to "worldwide exchange." let's get a look at u.s. futures this morning, following the outperformance of u.s. stocks last week and in march, we're looking at stocks higher in premarket trade. perhaps that has to do with oil stabilizing a bit and a weaker dollar as well. as we're going to the top of the hour, that means the team from "squawk box" is getting ready. andrew ross sorkin joins us with a look at what's coming up. andrew, good to see you. >> seema, good to see you at this hour. >> a lot of focus on the deal, i want to get your thoughts on the alaska airways and virgin. >> i did make calls for the talks last night. looks like we're getting closer to the transaction. i don't know if it makes as much sense as ultimately it would have made. i understand the views around
the justice department or how they would have viewed the potential jetblue combination. and it also takes alaska airlines out temporarily of being taken over by delta which was the other chess move that a lot of players, analysts and investors had been looking at. we have david reubenstein on the program. he's going to be starting at 7:00. we'll talk politics because we'll go daly also on the program. a lot to chew over, guys. >> andrew, thanks for joining us, we look forward to "squawk box" in nine minutes time. on the topic of jetblue, it's up 30% in premarket. that will be one to watch. at the open, we got five or six minutes to the top of the show. joining us in florida, ed keon, managing director at qma, ed, you are an asset allocation expert, picking out the sector in regions you want to be in. there's been a lot of
differential performance. yes, the u.s. has bounced back but it's been pretty divided as to sectors. and if you look elsewhere in the world, like europe, for example, they haven't bounced back as strongly as the u.s. does. are there opportunities there to be long or do you remain kachs? >> well, we remain well diversified across our portfolios but we do have overweights to risk year assets. we've added positions to of course, the united states in the past month or so. we're cautiously optimistic. we're keeping broad diversification with stockings and bonds and real estate. and we have a bit of a tilt towards risks which is different than the beginning of the year. >> tell us about that. >> well we tend to look broadly across the entire asset class. we're not picking sectors in my part of the business but we do like higher portions of the market. if you want to take overall risk
in the portfolio in some of the sectors like technology that give you more exposure, that may be more attractive. >> ed, the price is oil is down 60% over the past two years. it has been stabilizing over the past few months. is that a bullish sign for u.s. stocks? >> well, oil prices historically, if you asked me two years ago are oil prices going higher would be negative for stocks. but of course the last few years we've had a change in the historical correlation. it was interesting we did have a good day fried in the u.s. stock market, despite a drop. maybe that correlation is changing back again. the negotiation of stability, a more stable world, traders view oil as a proxy for stability. also for a proxy for growth in the united states and around the world, especially in china. i think a little bit of stability there and elsewhere is probably helpful, gimp the level of nervousness you've seen in assets and markets worldwide.
>> as we take a look at bonds would you still look to investors to hedge a risk? >> i have about a 10% vest in long term equities. they serve as a hedge. you have a pro inspected low and a positive expected return for moving hedge. and in a portfolio, it's a good idea to have operation of stocks and bonds. what we try to do is tilt the portfolio whey we think the opportunity is. >> ed, what about markets we've seen some of them on an absolute tear towards the end of last quarter even though the fundamentals in some places aren't particular good, they bounce back. do you some of that in your portfolios at the moment, nor?
>> we have very much underweighted emerging markets some the last years. but we have been adding to positions not a lot. we're still underwater in terms of benchmarks. we have underperformed a little bit in emerging markets they've done so well recently. i don't think we're ready to go to an overweight position. there is tremendous uncertainty as you mentioned in brazil and china and emerging markets but we're starting to nibble at positions to and add to and being excessively underweight as maybe we have been in the past would be such a good strategy in 2016. >> in the u.s. over the weekend, donald trump is reportedly reported as saying he think the u.s. is headed to a massive recession. do you agree or is he off the ball on that one? >> i don't see much evidence that we're headed for a recession any of type. if you look at the employment data that has been very strong. employment does tend to be a
lagging indicator but the isn data was quite positive, especially in some of the future oil components that i think got the market going again. so it doesn't look to me like there's a recession on the horizon. of course, resegs are difficult to predict. i don't think it's likely this year. i think going through this year, next year, we're in pretty good shape in the u.s. economy. >> ed keon, thank you very much for joining us this morning. we only have about a minute or so left in the show. we want to highlight a few things, what are you watching? >> i will be keeping an eye on the brazilian bovespa. up 17% year to date with the change in government. as they lose support, the other parties we'll see if they back out. >> definitely one to watch in brazil. but on the ten-year yield, we've seen bond buying so it's not unabated risk on sentiment.
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good morning. millions of leaked documents known as the panama papers. we're calling these the panama papers. they detail decades of money laundering arms, drug dealers and tax avoidance. donald trump saying we're on the verge of a big recession. some economists are saying not so fast. and the day is national hug a news person day. find your friendly neighborhood news person, reach out and show them some love. sore show them love on twitter
with the #hug a newsperson day, wow, i'm getting excited from you. no, it's monday, april 4th. and "squawk box" begins right now. thank you. thank you. ♪ >> announcer: live from new york where business never sleeps, this is "squawk box." aww. good morning, everybody. happy monday, welcome to "squawk box" here on cnbc. >> how much did you pay for those hugs? >> that was sweet. i'm becky quick along with joe kernin and andrew ross sorkin. let's take a look at equity futures. we've got green arrows. s&p up by 4. nasdaq up by 16 this comes after a week of gains for the marketing. the dow 1.6%. nasdaq up by 3%. overnight in asia, markets in china and hong kong were closed pour a public holiday. not much movement in