Skip to main content

tv   Street Signs  CNBC  April 25, 2016 4:00am-5:01am EDT

4:00 am
various bids as well as a likely ipo. in the second quarter of this year we would come to a conclusion. >> no spoilers. the sixth season of the "game of thrones" premiers lighting up social media with a surprise ending. we've got the survey coming out from germany, the business climate index, coming in at 1.6 in april.
4:01 am
this is a touch weaker but we are splitting hairs here. the belief is that it would be a bit stronger based on what we got from the new survey last week. but as we look at the outlook concerning brexit, the expectations index coming in at 100.4. the current conditions coming in at 113.2. it is just a touch weaker than expected. overall, a touch weaker but not too bad. >> a little bit weaker. not a lot of reaction in the euro dollar as one would anticipate at the moment. it seems like it's the bigger picture stock from last week. this week the bank and the fed are meeting. and the european markets a little lower this morning, down by .70% across the board.
4:02 am
we had a strong weak of gains across europe as they hit a three-month high. up by 1% for the week. we'll be talking to a strategist a little later about how to position yourself. here's oil as well, the price of oil a little weaker in this morning's trade here in europe, brent and wti down. >> i'm questioning how strong the correlation is. last week we were higher and the markets were lower and vice versa. we are below $2 a barrel on oil. let's get to the top stories, u.s. president barack obama took his atlantic transit push to hanover. obama used his keynote speech to promote his ttip agreement saying time is not on our side. >> i want to be clear about
4:03 am
this, ttip will not lower standards, it will raise standards even higher. high labor standards to protect workers, high standards to protect consumers and to give them more choices. >> nancy is in hanover with president obama. nancy, i waded through several reports on how beneficial ttip will be for europe. and one of them, the european buying commission, said there will be 1.3 million european worker that is will lose their job as a result of displacement. that's a tough thing to hear in europe, isn't it? >> reporter: it is an extremely tough thing to hear when you look at where the unemployment levels are since the financial crisis and one that leaders are trying to offset. just a half hour ago we heard from angela merkel speaking alongside president obama saying, look, this industrial fair is not just about touting
4:04 am
the benefits provided for corporations. this is for people, too. she acknowledged concerns over jobs and said we want safe and secure jobs as part of this ttip plan. the big question remains, what are the provisions in the trade pack to secure jobs on both sides of the atlantic. we heard some back and forth between merkel and obama this morning saying we both want free trade, but obama said native america is best. we want you to invest in the u.s. and angela merkel keeps saying the same. you have the likes of general electric and siemens explaining here in hanover. and the message is that the doubters that you suggest, that's why we saw great protest here before obama landed in hanover. 35,000 people on saturday alone came out to the streets protested the ttip.
4:05 am
no doubt about it, the politicians have a serious task ahead when it comes to convincing people that ttip is the right way forward. even if they manage to do that, we are talking a few years out before implementation. president obama said time is of the essence. you know when you look at the political winds in the united states, the tide is turning against free trade with the likes of donald trump and bernie sanders saying look, free trade is not everything it's cracked up to be. so that's a big concern. if obama does this to be agreed on, it could still be for some time to come. after the meeting here, the leaders go on to the u.k., italy and france and are expected to take up security concerns over isis, the refugee crisis in syria and the way that develops. >> nancy, we'll see you soon out
4:06 am
of germany. here in the u.s., president obama has ruffled a couple feathers as well with fresh intervention now into the europe referendum. brexit campaigners said it could take a decade to get a trade deal with the u.s. >> i think it's fair to say that maybe some point down the line there might be a u.k./u.s. trade agreement but it's not going to happen any time soon because our focus is, in negotiating with a big block, the european union to get a trade agreement done. and u.k. is going to be in the back of the cue. >> david owen joins us, a former british secretary, good morning, sir. thank you very much for being with us. so mr. cameron now weighing in? surely that carries some weight. especially him saying it could take a decade to get a trade deal with the u.s. and britain would be in the back of the
4:07 am
queue. that's not good news. >> personally, that's president obama, who i support and my wife is american, but he hasn't been able to get through the present ttip negotiation. so he's not -- and he's even in trouble with the pacific trade deal. trade deals are very unpopular. or for your key presidential candidates. so let's have a look at it. and i personally think he's -- there's a little convention, we stay out of each other's political parties. he's the first president ever to come into an election in the u.k. and i have a feeling he will -- >> your background, in terms of the positions you've held, you were the british foreign secretary from '77 to '79. you left the labor party to set
4:08 am
up the democratic party. you are a social democrat, you still tow that line now. >> i have always been pro-european. >> exactly. so what made you switch? >> everything from japan is on this euro. this is the issue, we have common market in the european community until 1992 and then we introduced britain opposing it. nevertheless, it was a disaster. basically this belief that you can have a currency without a country and this experiment has gone on. we now have a eurozone crisis for several years. the u.s. will try to change it. britain tried to make them change it. they won't change it other than in a crisis because they can't. they have left the eu in dysfunction. it's a dysfunctional association. the british are anxious to get out. obama is interested for us to stay in to try to prevent a collapse but it's time to put the interests of our people,
4:09 am
jobs and our prosperity first and got out of a totally dysfunctional union and it's heading for nowhere, quite honestly. it's a stagnant area. and we have to find other jobs, other trading opportunities in other countries. and i hope the future american presidents will help us with that. >> so ten years to take a trade deal wouldn't matter? >> ten years? who could tell, if you have a president who wants to help you. you could have a trade deal in ten months to a year, actually. we have been negotiating the ttip through nine months' time to a year. i think congress will say, why not add in the british separately. they hardly need any changes to accommodate this. >> you think he's got empty threats, a hypocrite? >> i don't use those words at all. he's a pretty able politician.
4:10 am
it probably goes down well in america. he spent his time with the queen. he was seen with the future king and future prince george. he's had a good time and his wife is with him, he's enjoying his time, he's playing golf. >> not suggesting anything good about policy. >> he has broken quite an important rule, that you respect the democracy of another country and flagrant intervention in a referendum like that. i was sad to see him do it because he goes against -- he would never sign up for any of this stuff. he wouldn't give up his sovereignty. look at canada. they've kept their currency separate, they are a separate country and are proud of it and quite rightly so. the british tradition is not to get invoked into the united states or europe. if the continent wants to do it or as churchhill said in 1946, that's good for them.
4:11 am
>> europe, would you be happy to see them unravel and potentially unravel led by a brexit? >> no, i personally support them going into the united states. i think there's only one option for them. so i wouldn't block it in any way at all. let them do it. we do not want to do it. we are the fifth largest economy in the world and have been an independent country for a thousand years. we do not intend to envelope ourselves in the continent. i was in paris a few weeks ago talking to the former prime minister who has long wanted the united states and europe. we said good luck to you and now we agree, i have never been a federalist and most british people are not. i think you have a chance to convince the friend ench peopleo into the country. >> in regard to brexit, should
4:12 am
mr. cameron resign? >> no. we have all the demands on our campaign to say what we should do. all we're saying is in or out of the eu, the elected government has four years to run and under a fixed term, obviously cameron has to adjust his cabinet to reflect the decision. he says he will implement. good luck to implementing and doing it sensibly in a way to help britain and help our future prospects. 54% in spain unemployment levels for under 25 during this year's end crisis. coming down very slowly still. and even now they say 18%, 17%. and i saw him collapse in greece. this collapse of four or five eurozones will be very troublesome for the u.k. troublesome for america, not as bad for you, very serious. >> we'll have to leave it there. thank you very much. thank you for coming in to talk
4:13 am
to us this morning. david owen, former british foreign secretary. the conversation continues the discussion coming up shortly. i will talk to the executive commission for shore capital, howard shore. we'll look at the european markets. we are .60% for the ftse 100. we have the basic resources in the xetra tax down 1%. let me give you details of this. we have a 4 billion capsule plan out on friday. the french government will take up three quarters of the new shares. edf will discuss this on the nuclear power plant until
4:14 am
september. the company's board has been expected to sign off on the project in may. shares trading sharply lower this morning. and actually, one of the analysts is suggesting that this new issue, the 1 billion euros, will be 15% below the current chair price. so they adjusted the price target to ten years. so even below where we are trading today, the shares are lower when the ipo said it is more than likely a sale for the division. earlier we asked the ceo about this problem, frans van houten. >> in second quarter we hope to come to a conclusion and hope to shortly do that. if you look at the first quarter results, i think we have a 3% growth driven by 5% growth in
4:15 am
our health activities. >> over in the german market, covestro is at 1.73%. after reporting a 22% rise in ebitda on the back of prices. this after receiving an upgrade from analysts at bank of america merrill lynch, which you can see higher by 2.9%. reportedly, seeking to shed a 13.5 billion swiss franc. novartis hires banks to sell 33%
4:16 am
of the voteing rights stake in roche. and according to multiple media reports, two are submitting a formal offer to buy barclays shares. more will be released on wednesday of this week. so moving on, ellen higgins with us, chief investment officer, what is going on with the markets? because 1.5% a week ago we were near two-year lows or so on the s&p 500 as you point out and on the ftse as well. now we are close to a year high. do we like the rally? >> we like the bearish sentiment in the markets.
4:17 am
when you look at the association of the individual investors in the u.s. or the ratios, there's tremendous demand for a sign of bearishness. and generally the sientiment indicators that we look at. they are very cautious about the markets. that's a risk of today. that's providing support of the markets. >> what's driving us? >> well, long-term from '08 to '09. memories of '08 to '09 and a narrative at the start of the year with respect to china and commodities. very, very bearish basic conditions in the markets. and if you look, for example, the price of put options compared to call options, that really is an extreme level until very recently. so generally people have been pessimistic. here at coutts we are a bit more optimistic until we have had quite large equity waitings.
4:18 am
>> so you're saying some lack of conviction. a lot of people are saying we are buying here but we're not so sure. so is the market behind the data in a sense in sentiment lifting higher here. because if you look at earnings season expectations so terribly low, you have to argue what we are seeing in previous quarters. that is we're going to at least meet expectations. so it's not going to be a real downer on the market. >> yeah, i think you're right. >> what drives this on? >> if you look at the underlying force, the interest rates, equity is a cheap asset class compared to ultra low interest rates. you have hundreds of companies where the corporate bond yield is an underlying force. but in terms of earnings, you are right. expectations will drive us on. central banks are supportive. we have the bank of japan this week. maybe they will buy some more equity etfs. like the fed should be supportive. >> how about the fed as well?
4:19 am
and kind of -- are they going to become a little bit more dubbish or hang on to the two rate hikes? >> we wouldn't expect two. we expectation caution on rates. so maybe one this year. but i would expect yellin to continue to be very cautious. >> how do you make money here? what should investors be doing? >> equities and we like japanese and european equities. equities are come back. we like high-end debt. >> if we see your prices come up again -- is that a judgment? >> you have to make a judgment that oil prices are very much contained. we did have a 20% correction. so we're recovering the 20% correction. >> allen higgins, thank you.
4:20 am
e-mail the show, the address is on the screen for you. we are also on twitter live, @cnbc. coming up on "street signs," carmakers descend on the largest auto market. the beijing auto show. we'll find out who is speeding ahead amidst the slowing growth. every year, the amount of data your enterprise uses goes up. smart devices are up. cloud is up. analytics is up. seems like everything is up except your budget. introducing comcast business enterprise solutions. with a different kind of network that delivers the bandwidth you need without the high cost.
4:21 am
because you can't build the business of tomorrow on the network of yesterday.
4:22 am
earlier we heard from president obama who gave his two cents on britain's membership against the brexit. some countries have a different view. some say the u.k. has a better
4:23 am
future outside the union. helena morrissey says a vote to go global would be best. what do you say about brexit, you don't think much will change, if anything? >> not much will change in the long-term. there will be stability in the vote if we choose to leave, but if you're being told to leave that is self-reinforcing, but fundamentally the trades in the short-term will remain the same while the government negotiates with europeans and the rest of the world. it's not in the european interest to change anything any more than it is in our interest. we got to think about the long-term benefits of leaving. and i think there's major long-term economic benefits of leaving.
4:24 am
>> what about immigration? because the suggestion is, look, you can have all the benefits of a single market even if you are outside. but the other is the freedom of movement. i would argue that you actually can't do that if you have the benefits of a single market, you're still going to have the down sides that accrue with the immigration issues. is that not true, too? >> ending the negotiations should be a british option. everybody talks about the norwegian option or the swiss option. i think we can have a british option where by far the largest economy is outside of germany growing rapidly because of the faster gdp growth. we can negotiate a different deal. it's different circumstances. we're not trying to exceed to the eu. now we're in it. and everybody's got to think about terms under which we live.
4:25 am
>> the i think europe was given better terms in the pre-negotiation stage. is that a concern to have so much leverage? >> at what point? >> any point in the last five months when trying to negotiate before this referendum was called. if the u.k. has so much leverage, why wasn't it given more leverage when the referendum was called? >> you're talking leverage over terms inside the eu. i'm being told we can only have free access to the market if we accept their immigration policy. and i'm saying because there's such big net importers of particularly german goods, it's just as much in their interest to keep the terms of trade the same as ours. it's a different question, why didn't they make more concessions politically. it was very hard and certainly against angela merkel's psyche to change freedom of movement. she's against it fundamentally.
4:26 am
>> are you crucifying the financial sector in london on the issue of the freedom of movement. the financial district relies so heavily on being higher across the eu. you have something like 11% of the city's 360,000 people hired from outside of britain. i mean, that would be detrimental. >> well, of course, you're danish so -- >> i know. but london is very international in the financial sector on this freedom movement. >> i totally agree. post 9/11, getting the brain game from the rest of the world, the u.s. partly lost because of immigration restrictions. if we leave the eu, we can set our immigration policy based on who we want. not whether you are from europe or africa or the far east, but whether or not we want you to come here.
4:27 am
why should we give a particular advantage to someone coming from eastern europe and the middle east towards the far east? >> you have been and continue to be very supportive of the conservative party. >> yes. >> is that going to continue given that cameron is toting the line of we need to stay, you want to leave, how does that work? >> well, i think the conservative party is by far the best party to lead the country. when you compare it to labor, the conservative values are still at the core of the party. and i think that if we leave, the big opportunities to deregulate, that's something the conservative party will do and i cannot see the labor party doing. the big benefit of leaving is if we deregulate. the second benefit is a more proactive immigration policy to get people who we want. and thirdly, we can then pursue se selfish policies which benefit
4:28 am
our economy. for example, venture capital where we try to encourage venture capital in things we are good at, life sciences, farmer, medical research, et cetera. >> how do you play this or do you play this? because the ftse is at year highs and the bond markets are relatively unmoved and the sterling is down 10% according to the bank of england. it looks like the markets are up moved? >> we have a big trade deficit. and, you know, people talk about the big downside of leaving being a downward movement in sterling. i've never actually been an advocate of a low currency necessarily being a good thing. but actually countries all around the world have been trying to have competitive devaluations. so the chinese, the europeans, the japanese, the swiss are trying to keep their currency down. the whole world is trying to keep their currency down. now we are being told, ah, the currency went down a bit, isn't
4:29 am
that awful? it's not necessarily the case. the second point is, the market obviously anticipates these sorts of things. as we all know, the market is ahead of the game. the reality is the exchange rate over a five or ten-year period will reflect our economic performance. so what happens past the vote for a few days, weeks or months, you have to look five years out and say, sterling will be at level which reflects our economic performance. and what i am saying is, our economy can do better out. >> howard, thank you very much. you have been writing in out there and giving us your opinions on whether or not we should stay or go, whether brexit should happen or not. keep your tweets coming through. we are both on twitter, you'll find it. howard shore from shore capital. are you a beyonce fan? >> of course. >> beyonce fans? forget milkshakes, it's all about beyonce's lemonade bringing the boys to the yard.
4:30 am
hear about her new album next.
4:31 am
4:32 am
hi, everybody. welcome back to "street signs." angela merkel and president obama urge action despite large protests on the streets of hanover. and the edf capital raising plans is a worried ceo looking to the french government to take up to three quarters of the new shares. phillips is on track for the worst day in ten weeks after the dutch group says the ipo is more likely for the sale of the lighting division. >> we are in this process still evaluating various bids as well as considering the possible ipo. we have always flag in the second quarter of this year we would come to a conclusion.
4:33 am
no spoilers. the sixth season of hbo's "game of thrones" premier is lighting up social media with a surprise ending. well, let's give you a look at u.s. futures this morning. we did see very little movement in terms of the dow and the s&p on friday. the nasdaq losing ground and there is tech earnings this week to watch the likes of apple and amazon. so that will be one of the critical drivers of the markets. so for now, we are indicating the s&p 500 just shy of 100 points for the dow jones. the nasdaq down by 30 points. so following the tone we have seen in europe and asia overnight as well, we have a lot of things coming up this week. as we mentioned, we have the fed decision and the bank of japan. will they choose to add more stimulus. one report we saw over the weekend was potentially negative reports on loans and the ecb.
4:34 am
we'll see that one, but on the european markets across the board, the basic resources, here's a look at how the asian market session played out. the shanghai composite and the hang seng are lower. one of the key focuses, we talk about this a lot, china's debt that rose to a record 237% to gdp in the first three months of 2016. this according to "the financial times." beijing authorities have racked up lending in the face of slowing growth but the concern is now mounting over the long-term impact of china's rising debt. just how much of this is being used to sustain that. over in tokyo stocks fell after worry over sony and mitsubishi are delaying earnings reports. the question is why.
4:35 am
we are joined by nhk's makiko. tell us more. >> yes, sony fell 6% after announcing last week it will delay reporting its earnings forecast for the current fiscal year, which was due this week to sometime next month. it says it needs more time to take into account the effects from the earthquake that hit southern japan earlier this month. sony's factory in kumamoto, which was the main area hit by the earthquake, was producing sensors for additional cameras in smartphones including iphones and the production line was damaged by the quake. and it is still unclear when it will be able to resume operations. the factory suspension could affect the company's divisions that deal with imaging, which hold around 20% of total sales. meanwhile, mitsubishi motors which is in the middle of a scandal for replacing field economy data fell 5% today after plunging 13% last friday. the carmaker's scheduled to announce earnings on wednesday
4:36 am
but there are speculations the earnings forecast could be delayed for the current fiscal year. the company's currently conducting an investigation into the matter and the speculation that the scandal could widen further is worrying investors. and that's all from the nikkei. back to you. >> thank you very much for that. let's bring it back to europe for a second, bw's brand chief says he's confident that management and labor will resolve their dispute over cost cuts at the auto division. earlier this month the leaders accu accused them for cutting jobs. since then both groups are working to secure packages for workers but further details haven't been released. meanwhile, volkswagon says it is optimistic of the positive sales trend in china will continue. the german automaker plans to invest 4 billion euros alongside its joint venture partners in the country this year. he says they will focus on expanding suvs and the new
4:37 am
energy vehicles in china where sales fell nearly 3.5% last year. well, ford is not interested in a tie-up with fiat chrysler according to the ceo mark fields. this in response to a comment that ford could potentially be a merger candidate. speaking to reporters, field said, quote, i can't speak to what others wake up and want to say. the global industry is gathering in committhina to sho the latest in auto sales. >> reporter: first-time car buyers would choose international brands because of the representation for quality. however, these days chinese companies are upgrading themselves investing heavily in rid and gaining traction. for the first quarter, the suvs
4:38 am
were made mainly by chinese car companies such as great wall. great wall will be unveiling an suv at the car show. and so is cherry as well as gealy. all the chinese car companies have a big selling point. not only have they upgraded their styling as well as performance, but also their price is a huge advantage. some of the cars are selling for less than $10,000, which is a big advantage in a slowing economy. the foreign branded carmakers, though, are still slugging it out. some of the brands such as mazarati that don't have an suv in their lineup are now unveiling an suv to grab market share and attention for that chinese car buyer that does want one of these bigger, badder cars. eunice yu, beijing. ted cruz and john kasich officially announced an alliance to divvy up the next primaries in an effort to defeat donald trump. tracie potts is in washington, just how successful is this
4:39 am
strategy going to be? >> reporter: well, we'll see what their aim is, to keep donald trump from getting to the magic number, 1,237 needed before the convention this summer. overnight they agreed to divide up some of the remaining primaries. in other words, john kasich would hope to be very competitive in indiana. it's the state next door to where he's governor. he's going to abandon indiana. he's already canceleded a couple of events there and will go one-on-one with trump. and two of the primaries in new mexico and oregon, cruz is going to step back to allow kasich to take on trump there. the hope is by splitting it up, they will remain competitive in the rest for now, but the hope is by splitting it up in these particular states, they will prevent trump from getting an even greater amount of delegates before that convention. we've got reaction this morning
4:40 am
from donald trump. you can imagine what he says. he calls it a horrible act of desperation. he tweeted that both of these candidates are mathematically dead. the so-called never trump movement are behind this. now urging their supporters to go along with it. and interestingly, on the other side, one of the top republican donors, charles coke, says he thinks hillary clinton could possibly be a better candidate than either of the top two democrats. clinton's campaign responding, no thanks to that support, not interested. she's still taking on bernie sanders in the five states coming up tomorrow along the east coast. >> tracie, thank you very much. tracie potts joining us live from washington. now asaudi arabia's prince s set to unveil a new vision for the country today. here's the report. >> we are hours away from the national transformation plan.
4:41 am
this is the plan to bring this country forward and away from oil dependency. but the big questions remaining outstanding are, the trillion sovereign welfare fund, how did they come up with this number essentially? we have understood they reached out for a $10 billion loan and we also understand they are looking to tackle national debt markets further. the houch /* seal question remains how they got to the $2 trillion figure. today they will be announcing subsidy reforms, essentially texas, texas on land as well as texas on sales and certainly on fizzy drinks even. so at lo of speculation to the details of the plan, but in the end this is a country that has
4:42 am
to put the young population to work and the folks need jobs. so the big questions going forward, what are the details going to be on the national transformation strategy? and what are the social repercussions here as well because there's a lot of speculation as to whether we hear women are able to drive in saudi arabia. so a lot of questions remain to be answered. and the big deputy crown prince, mohommad vince alman, everyone is waiting to hear what he says later today. and we'll bring in our next guest, what are we supposed to make of the 15-year plan once the details are unveiled. do you think it will be detailed enough? is it going to be far reaching enough? >> it's going to show the transition of saudi arabia. looking at it as an oil country. if you look at the evaluated oil
4:43 am
price, you can't see the difference between saudi arabia and other moguls. but if you look at the oil prices, the government is looking to them. they have resources and are trying to activate it through listings and creating the pif sovereign fund. the anchor was talking about, a while ago, was talking about the loan close to $3 trillion. they have to collect all the national asset. for example, the government are the major blue chips in this market. it's assets, not cash. it's diversified assets. and they could try to create a synergy of investment environment that could attract national and foreign investors. >> i look at what the deputy crown prince has done, hidden asset sales, new sovereign well fund was announced as well, do
4:44 am
you think he'll garner enough support from the royals and the leadership as well as from the actual citizens? >> well, actually, a lot of previous kings, nobody could stop them all with the intent to do it. the point is the power is with the king. the point is with the cultural resistance you could face. that's happened in western europe 300 years ago. it happened in japan 60 years ago. the question is, how can you create benefits that could attract the society or to make it easy? i think you better learn from what is happening with the oil in saudi arabia. the government, the minister did not understand the concept of the transition. the idea is to change the behavior in the culture and to overcome. >> speaking about the culture, you won't have a country thriving when curbing the rights
4:45 am
of half the population. having made the point about women not driving, he suggests this is something he thinks can happen. he's just concerned about the religious element to the country being opposed to it. is that going to happen and how quickly is that going to happen? >> it's going to happen gradually. >> define gradually time wise. >> it's going to come from the labor force. >> one year? two years? >> i'll give you five years. >> really? how is reform credible then to take five years to do something like this? you are someone in big industry, why would you not rather hang out in dubai rather than coming to rio? >> i want to explain that 70% of federal employment are females. so all of this -- >> the statistics, yeah. >> a lot of it is inactive so we try to activate it and integrate it more to our economy through the private sector and the public sector, both of them. and now you're talking about
4:46 am
now, even you're mentioning the rights of females and the government, the civil rights i think will happen in the coming month, but the problem is not with the female. i think 50% of our implementation is transportation. we have 3 million barrels, so we have a problem with the transportation issue and are trying to implement the public transport. so you are consuming local crude oil. >> so can i ask you, the saudi market was open to foreigners to invest more directly as of last year, the summer of last year, what have we seen since then? i mean, have we seen a large amount of inflows? are we anticipating to see more. because from my middle eastern friends, we have not seen that much trade coming in from foreigners. >> exactly. there's the issue with the infrastructure, for example, t
4:47 am
plus 2. this is going to be something related with the infrastructure and the operation efficiency. i want to mention it, even with low prices, reforms, so many foreign investors are actually watching and trying to understand what's going to happen and the good moment to invest. what's the nature of the economy to invest. >> and in terms of where you see the most opportunity in saudi at the moment, where would that be from where you sit? your group, what are we looking at? >> with the changing of future stock prices, the major investment will be spotted on the surface. the nature investment. it won't be modern industry but more on the service side. that's what i believe. and this deal is going to involve more than i know how to create more added value through
4:48 am
the investment. i think this will take time but the service needs it now. >> why is this different from the other efforts we have seen in the past? i think the financial district and the financial sectors are a classic example. because of oil? because they have to? >> look to venezuela. they produce 2.7 barrels. still very independent of oil. russia, 300 million. the population is 15 million. the labor force is 5 million. totally dependent on oil and are asking for a freeze. this is too big. it's 90% of the physical income, if it's 96% of products in exportation. so it's an oil-based economy. it is not easy to create the transition and the specification of the economy. >> where do you think the focus is going to be put secondary to oil? >> i think it will be the education, the health care,
4:49 am
those kind of services. it's going to be much bigger. even other commodities, the other mining commodities. and energy, that's a main thing. you mentioned the company that could face a problem with energy. i think we'll see investments in energy. >> thank you so much. coming up here on the show, get comfy on your ceremonial chair. we discuss the fantasy land of westeros and discuss the sixth season of "game of thrones."
4:50 am
4:51 am
4:52 am
so it's time to get comfy on your world seats, "game of thrones" returned for its sixth season. according to the critics, the first episode didn't disappoint. major cliffhangers including the fate of john slow left fans longing for more. one in 15 americans watched this. >> the culture of "game of thrones" is extraordinary. >> it is incredible. >> i haven't watched any yet. i wait for a special day. >> have you watched any of it? no. i have read the books. >> i'm afraid if i start i become addicted and spend hours and hours watching. >> we are a little late now to the party. beyonce has quenched the thirst of her fans with the release of a surprise new album called "lemonade." we actually had to look twice to see what that picture was, i think it's her head and a
4:53 am
jacket. but this was exclusively launched on itunes. a couple hours later internet chattered why she decided to feature infidelity so heavily in her lyrics. >> nevermind infidelity, she only gave title owned by jay-z 24 hours to sell it. >> the power that these platforms have in terms of releasing, i mean, it's amazing. >> absolutely right. cue on corporate score cards, apple getting ready to report tomorrow a whole load of earnings in the tech sector and data to look at. wilfred frost is here at hq with more on the busy week ahead. good morning. indeed, a very good morning to you both. packed earnings and economic agendas. today we get new home sales out at 10:00 a.m. eastern.
4:54 am
on the corporate front before the bell, we'll get results from haliburton and xerox to name a few. and the fed's two-day meeting begins tomorrow with the post-announcement at 2:00 p.m. eastern time. a lot of other data to look out for like gdp on thursday and personal income and spending on friday. and apple is the big one, the tech giant reports after the bell. also worth watching, dupont, proctor & gamble, at&t and chipotle. on wednesday, facebook and thursday is the busiest day of the earning season, tons of firms including ford and amazon will release their results. finally, friday, we see chevron and exxon, particularly two to watch in the number space. i would say well worth watching the earnings season. two weeks ago banks were the main focus. they surprised and drove on the upside. last week looked to tech names disappointing on the downside and the nasdaq ending the week
4:55 am
in red territory. so earnings are moving markets very little this week. we look at the futures down .40% in prix markets following european trade softening at the open. guys? >> the s&p 500, though, seeing some pretty nice trade last week, wilfred. we were talking about whether or not we believe the current slight rally, well, the two-week rally we have seen so far. and you're talking about kind of the difference in looking at the banks, for example, versus the tech sector. from the people how talked to stateside, do they believe in this rally? >> i think that the big difference over the last six weeks of this rally has been that we also see bond deals compress, i.e., a fed-driven rally. the question is we came into earnings season, was that going to change and then be sector driven and company driven based on eps growth? and the last week or two suggested the element of that as well. but once, of course, there's a focus on earnings this week,
4:56 am
they will be just as big if not a bigger focus on the fed and whether to expect further rate hikes. no one is expecting it at this particular meeting. so i think people are trying to want to believe in the rally but they have not seen enough on the corporate fund to think it can extend without support from the fed at this stage. >> thank you so much, wilfred. i just want to quickly bring you up to speed with some news on deutsche bank. deutsche bank's co-ceo has been acquitted in his trial over the kersha case. the other former deutsche bank executives on trial have also been acquitted. they have been accused of giving false testimony. so acquitted in the case. >> loads of you have been writing in during the show. it is always nice to hear from you. one writes and say, the market
4:57 am
fr is quite bullish. i hope oil prices don't get a relatively good recovery. i was surprised on this call on high bond deals but think equities is a better investment. beth, great job, thank you very much. it will be interesting to see if feds language in the company statement this week, right? and also whether or not oil can throw a span in the works if we continue to see recovery. >> we have data in the first quarter in the u.s. as well. it's how they continue to temper market expectations versus the data. does it get ahead of them is the key? >> thank you very much. that's it for today's show. we'll be back tomorrow, same time, same place. have a lovely afternoon. bye for now. a lovely morning, still morning. >> "worldwide exchange" is coming up next.
4:58 am
4:59 am
5:00 am
good morning. a new week, a new round of tests for the global markets. at the top of the list, central bank decisions and corporate earnings reports. decision 2016. new this morning, ted cruz and john kasich teaming up to stop donald trump. the shocking details straight ahead. and happening now, president obama is in germany making a major pitch for a trade deal. it's monday, april the 25th, 2016. "worldwide exchange" begins right now. ♪ good morning and welcome to "worldwide exchange" on cnbc. i'm sarah

9 Views

info Stream Only

Uploaded by TV Archive on