tv Worldwide Exchange CNBC May 9, 2016 5:00am-6:01am EDT
good morning. crude climbs. prices rising on a raging wildfire from canada's oil sands and a cabinet reshuffle in saudi arabia. market alert. chinese stocks dropping on weaker than expected trade data. should investors be worried about the economy all over again there? and the race for the white house, why donald trump says he's open to raising taxes on the rich. it's monday, may 9, 2016. "wor "worldwide exchange" begins right now. ♪ good morning. happy monday.
welcome to "worldwide exchange" on cnbc. i'm sara eisen. >> was that song slightly sped up? this is a remix. >> it's all your energy. >> we better be suped up on what the markets are doing. the futures are pointing to a positive open. we are not seeing quite as many gains in europe but still gains nuns. the d nonetheless. we saw about 80 points higher about half an hour ago. the s&p called higher by 6 points. the nasdaq by 16. the dow and s&p made it two consecutive weeks of losses, albeit small ones last week. the nasdaq and the tech sector suffering a little bit more. the ten-year note on the jobs note out on friday, they did see some yield increases, albeit the
margin on 1.78% this morning. >> as far as the global markets, chinese trade data and oil prices, the chinese stocks closed sharply overnight. among the reason, weaker than expected chinese markets shrinking in dollar terms last month. imports was the worrisome spot declining nearly 11%. as for the rest of asia, japan's nikkei rose up 7%. the japanese yen is weaker this morning. in hong kong they managed to gain a quarter of a percent. but a sharp drop in china and a sharp drop in china on friday. first, the biggest back-to-back losses since back in february when there were a lot of concerns about the chinese economy. as far as the early action in europe, it's a concern. we have one eye on higher oil prices. and that is helping to lift stocks. some of the oil producers in europe. the dax is up 1.9%. strong numbers out of germany
when coming to trade data. in france we see a 1% gain as well. >> interestingly in europe despite oil prices being higher, it's the worst performing sector because of the chinese trade data. italy is suffering because the italian banks are down today. one in particular, bank of populare needing to raise more capital. as far as the currency market is concerned, as i mentioned, what we have been seeing is the weaker japanese yen helping japanese stocks overnight. we'll keep an eye on it. and we are seeing a stronger u.s. dollar against the euro. we're back in the $1.13 region after a weaker than jobs report out in the u.s. on friday to put pressure on the u.s. dollar. that's reversing this morning. a weaker than expected headline number. but the markets didn't seem too spooked. we ended up slightly on the day. >> we don't have to worry about the rate hike. >> right. but the underlying data wasn't so negative it got to the point where we thought, we have a
terrifying outlook on the economy either. >> and wages came in better. that was one of the better parts. >> interesting when we see this break either way to the stronger side very clearly or the weaker side for three or four months in a row like this, the only way i can see that the dollar reacts would be stronger on either outcome. because either you get global fears that growth is not going to be strong enough and the dollar becomes a safehaven again or you get the chance of rate hikes and get a stronger dollar again. so this weak dollar we have had has huge momentum behind it particularly against the euro, it's hard to understand the long-term fundamental argument for the dollar remaining weaker. >> except for the fact there's been a flat-out rejection of negative interest rates in europe and japan, which has strengthened the currency and has the opposite then desired effect. that's the other side of the trade. also, you're fighting the fed. janet yellin comes out and is cautious and dubbish and speaks on the dollar and that surprised everyone. >> the important news is that it was a remix of the taylor swift
song. i know my t-swift. there we go. we need to move on to a developing story out of canada impacting the oil markets. a massive wildfire consumed 400,000 acres and it continues to rage. cooler temperatures and light rain have officials feeling more optimistic they may be able to get a handle on the devastation in the oil sands region. more than 80,000 people have been evacuated from fort mcmurray once known as a canadian oil boontown. the fires destroyed 1600 homes and buildings in the region. officials say there's no timeline to return residents to the city. >> despite the optimism, oil prices are reacting as the wildfire has knocked out over a million barrels in daily production capacity. 11 production firms and three pipeline operators have actually curbed activity taking precautionary steps as a result of the fire. bp and other major oil firms warn they will not be able to
deliver on some contracts. so we got some supply concern, that's pushing the price of oil higher this morning. wti is above $45 a barrel. 45.58. brent the international benchmark up 46, almost 1.7% or so. >> wti down last week for first week in five so the gains today up 2% taken in perspective of that. we are not soaring higher. we also have another major oil story moving the markets having to do with energy. that would be a cabinet reshuffle in saudi arabia. on saturday the monoaror can i announcing that the oil ministry is leaving his post after 20 years. hadley gamble is joining us this morning from ryadh. was it expected and what does it mean? >> reporter: well, it was expected over the long-term, but really what we are talking about
now is the saudi super team. and that is 24 ministers now charged with revitalizing this country's economy. of course, this does now include the new oil minister named khalid al-falih. he was the chairman and ceo of aramco as well. ali al-naimi was taking an emotional farewell from colleagues at aramco and is moving into a position where he'll be advising the royal court. and the new pin stminister of o taking on a new name and direction focusing on solar power and electricity. and they are going to be focusing on mining as well. so a new direction for the oil ministry, but that doesn't necessarily mean that there's going to be any change in oil policy, at least in the near term. this is really about streamlining and consolidating power behind the oil court. there was an interesting report out in the "telegraph" newspaper about the three-way listing of
aramco, new york and hong kong of the largest ipo in history. and another interesting report was whether or not selective stakes will be allowed for exxon, bp and others. so interesting details to be worked out. we are still waiting for further comment from the ministries. guys? >> hadley, thank you very much for that. as we have said, oil prices have been moving higher this morning. hadley gamble from ryadh. joining us to discuss oil further is from london, richard manisted. good morning to you, richard. we'll put the canada wildfire news in perspective, we are up 2%. is that a relatively muted perspective in your eyes? >> i think it is. it's much more to do with the wildfires in canada than the news out of saudi arabia. really we have seen quite a lot of production out although the firefighters are talking more
positively yesterday. so we may have gone past the peak several weeks before production can come back fully. this comes after losses in venezuela and so on, but we have not seen prices suddenly ratchet higher. and i think that reflects a bit of weakness in terms of the latest economic data, a little bit of weakness in physical markets because a lot of refineries are still offline around the world. so we could expect quite a bit of volatility i think around the canadian news on othero outages >> in the longer term, does the saudi move have implications for the saudi after the doha nonfreeze, non-deal orchestrated by saudi arabia? >> yes, i mean, i definitely don't think we should expect a
radical departure. khalid al-falih is talking about it being left to the market to rebalance on its own. so the production freezes are definitely out. but that's the same as it was under ali al-naimi. there are a couple things that matter more, there's the backdrop of saudi arabia's vision 2030. this big strategy being championed by prince mohommad bin salman. we need to see more specific policies. but in the nearer term, we might start to see less oil burning during summer in the domestic power sector. that's traditionally driven a big increase in saudi crude production to feed the domestic power of demand. and i think with new gas production, with solar, with the alternatives they are trying to put more focus on, we could be in for a slightly smaller seasonal round which may catch the market a bit by surprise.
>> richard, very quickly, on wti we found a sort of base for oil prices for the rest of 2016? >> not for the rest of the year. i think range-bound in the 40 to 50 bracket for a month or two. but getting into the second half of the year, the rebalancing, the tightness in markets becomes increasingly visible and we go up higher and go past 60 before the end of the year. >> very quickly, it sounds like the saudi move doesn't do anything to impact your price or your outlook bullish or bearish for oil? >> not really. the only thing khalid al-falih does is talk to the media more. that could be marginally bearish if there's no opec action on the horizon, but much bigger is the rebalancing, the loss of non-opec supply and the increasing demand due to disruptions. that will make the difference to prices. >> richard mallinson, thank you very much. beyond oil we are watching other commodities.
gold prices right now, we'll show you this on the back of the stronger u.s. dollar in terms of the overnight session. gold has had a pretty strong overall year. there we go, it's up a percent in the early action. there's copper down 1.4%. copper prices hitting the lowest levels in almost a month. this morning they had a 5% decline last week. it's somewhat quiet on the economic front this week following the jobs report on friday. no data today but tomorrow look for march wholesale traid. then on thursday we get weekly jobless claims in april import price. on friday retail sales and consumer sentiment. and the big highlights are disney tomorrow, the host of retail names this week including macy's, kohl's and jcpenney. >> they are coming off the
somewhat growth slowdown for the u.s. economy. and sort of surprising 160,000 jobs added, wondering if the momentum is slowing across the board in the u.s. economy including hiring big firms as a big source in the recovery. >> i think retail stocks are the focus as you say. but in general guidance, for all sectors has been crucial because we haven't had encouraging enough guidance in the face of the dollar coming back and oil prices recovering a little bit. >> because we are big on certainty. now we have certainty with the u.s. election and brexit and everything else. we have stock movers to watch today. valiant tops the list. the stock does not look cheap according to barron's. the firm needs to wind down its use of adjusted earnings.
and barron's saying that the ceo is a successful conglomerate. that could be the reason behind the 1.6% pop in the free market. and donald trump is making comments on his tax proposal. have a listen. >> the thing i'm going to do is make sure the middle class gets good tax breaks. because they have been absolutely shunned. the other thing i'm going to fight very hard for business. for the wealthy, i think frankly it's going to go up. and you know what, it really should go up. >> and then when he was pressed on whether this is a change from his original plan, trump said it's all in negotiation. of course we'll have much more on the day's top political headlines and the effort that the republican party is making this week to try to unify themselves in the wake of paul ryan saying he's not ready to back him. >> that's right. as well as the political realm, we'll look at the top global
headlines and why the u.k. president david cameron feels a brexit could lead to war in europe. that and much more coming up. we were born 100 years ago into a new american century. born with a hunger to fly and a passion to build something better. and what an amazing time it's been, decade after decade of innovation, inspiration and wonder. so, we say thank you america for a century of trust, for the privilege of flying higher and higher, together.
british prime minister david cameron speaking earlier this morning warning that a brexit would increase the chance of europe going to war. he suggested that the eu had in his words, quote, help reconcile countries and maintain peace. just six weeks until the june 23rd referendum. that element of security has always interested me because we talk about it in terms of the market and how it hurt the british economy. this is something president obama was talking about when he went over there. rightly or wrongly interjecting into the debate about how as a peaceful force, if the eu stays together, it will be better for national security or international security. >> the david cameron side of the bargain is focusing on the economic arguments. it is interesting to see cameron bring that up today because in general security tends to be a point but the exit camp has a little bit of leeway in terms of what it means for britain alone. i think for europe as a whole, the argument is clear, if britain remains in, but this is
a vote for the british people. so far cameron and the camp have stayed clear of this because they don't want to say it's an argument to stay for the rest of europe. they want to focus on the u.k.-century trib argumeric arg. but we expect the campaign to pick up pace now because the local elections were finished last week. and cameron has done his speech and boris johnson will do his in a half hour's time. six weeks ago i mentioned the pace of the campaign will pick up very much. elsewhere in europe, greece's parliament is voting to pass new austerity measures to increase taxes. this vote came amid strikes and demonstrations on sunday. some protesters through molatav cocktails at police who responded with tear gas. the eurozone finance ministers are meeting in brussels to discuss greece's fiscal strategy. coming up, your money, your
vote. can donald trump convince top republicans to actually support him? that story topping today's political news next. but first as we head to break, here's today's national forecast from the weather channel's jen carfagno. >> sara and wilfred, on this monday the sun is finally coming out in parts of the northeast. it's been such a stretch. take d.c., for example, it's been since the 17th of april that we have been in the clouds. and we have more rain there in the forecast today. but the sun will peek out in new york city, temperatures are going to be in the mid-70s. the real top story today will be severe weather. chances again right here across the heartland from texas right up to missouri. storms of hail with damaging winds and the threat for tornadoes as well. and rain up here into parts of the upper midwest as well. the west stays dry and we'll look for temperatures warming up this week. but for today, we're running close to average or even a little below. hot across parts of the south, temperatures back into the 80s again. that's your coast-to-coast forecast. i'm meteorologist jen carfagno
from the weather channel. "worldwide exchange" continues after this. [ toilet flushes ] so when you need a plumber, we can help you get the job done right, guaranteed. get started today at angie's list. real is touching a ray. amazing is moving like one. real is making new friends. amazing is getting this close. real is an animal rescue. amazing is over twenty-seven thousand of them. there is only one place where real and amazing live. seaworld. real. amazing
welcome back to "worldwide exchange." to politics, we'll see if donald trump can convince the top republican on capitol hill to support him. he sits down one-on-one with house speaker paul ryan on thursday. nbc's tracie potts is joining us live from washington with all on what to expect on the political front. >> reporter: hi, wilfred. good morning, everyone.
ju donald trump as we expected seems to move more to the middle as we move to the general election. now he's talking about rich people, wealthy americans paying more taxes. that's something the democrats have pushed for years and republicans like trump have pushed against. >> for the wealthy, i think frankly it's going to go up. and you know what, it really should go up. >> reporter: he's talking about taxes. donald trump reversing his own plan saying negotiations will result in the rich paying more. bernie sanders isn't buying it. >> donald trump wants to give away hundreds of billions of dollars in tax breaks to the wealthiest few. >> reporter: hillary clinton says trump's inconsistency should trouble voters. >> maybe he just doesn't understand that running our government is not the same as making real estate deals. >> reporter: trump meets with paul ryan on thursday. the republican house speaker says he's just not there yet on supporting the party's presumptive nominee. >> he doesn't want to have reporters put microphones in his candidate's faces every day to
explain the latest utterance by donald trump. >> reporter: but key republicans argue since their voters like trump, party leaders should get on board. >> you have to listen to people that have chosen the nominee of our republican party. i don't think -- it would be foolish to ignore them. >> reporter: republicans still say maybe. some like former rival jeb bush say absolutely not. bush won't vote for trump and won't vote for clinton. >> which i don't get as he's making a statement, but not voting is not a good message to erk man america. >> reporter: exactly. some say it is distasteful to vote for trump but may not vote at all. that could have a huge effect on the republican campaign. >> tracie potts, as ever, thank you. to sports news, orlando, florida, was the site of
pageantry, pomp and circumstance of the second invictus games started by britain's prince harry held for the wounded, sick and injured personnel from all over the world. more than 500 athletes will compete. prince harry outside on hand to cheer on the team from the u.k. he was flanked in the stands by first lady michelle obama and former president george w. bush. the invictus games run through thursday this week. good luck to everyone taking part. there's no stopping marvel comics and "captain america" at the box office. the latest installment of "captain america: civil war" opening with $181 million in u.s. and canada this weekend. that's the fifth highest debut in history. marvel now accounts for actually four of the top six domestic openings of all time. it was a great weekend overall for disney that owns marvel. along with "the jungle book" and
"zootopia" collect iing the top box office in 128 days. i know a lot of people who saw "captain american" spanning all ages. >> i'm more excited to see "the jungle book." it is childish but looks good. moving on, uber and lyft looking to suspend service in austin after they failed to adopt a ballot measure to control greater self-regulation. the company says new rules requiring them to finger print drivers will make it hard to continue to maintain business models. this comes despite the two companies spending a combined $8 million on the campaign leading up to saturday's losing vote. i'm going to austin soon and won't be able to use uber or lyft. >> it's a fun walking city but there are safe cities. you can get on a segway, which i did in austin. >> i'm not sure that's a good idea to me.
gasoline prices jumping 9 cents over the past two weeks alone. and learn from the best, the new start-up wants to give you acting classes with kevin spacey for less than $100. we'll bring you the details on this monday, may 9, 2016. you're watching "worldwide exchange" on cnbc. ♪ i thank god every day that i woke up feeling this way ♪ >> good morning and welcome back to "worldwide exchange" on cnbc. i'm sara eisen. >> i'm wilfred frost. >> is this a remix or the original? >> i don't know what the song is but i thank god every day we have this wonderful job sitting here together. >> as do i. let's get started with a check of the markets. the u.s. equity markets are off to a higher start on the back of strong oil prices. the dow futures up 48 points. the s&p futures up 6. the nasdaq futures up 16 after the weak week for the markets last week. we'll show you the ten-year
treasury note yield right now. after seeing lower yields, we saw somewhat disappointing jobs numbers with 160,000 jobs added for the month of april, we'll show you the treasury market. on the ten-year note yield, that's moved below 180 as we saw last week. and we are a little higher this morning at 1.78. >> the stocks are closing lower after the weaker than expected earnings. sri is joining us live with all the details from singapore. >> reporter: good morning, wilfred. quite right, whichever way you slice it, this is a grim set of numbers from china on the trade front. exports and imports down more than the market was banking on. so the markets in the mainlands taking that at face value. sign of economic stress on the external and the domestic side amongst the consumer. we're off by almost 2.8% at the close. tomorrow, we have inflation
numbers. and if we can continue to see a benign set of figures, especially with ppi, factory gate inflation, that will clearly give the pboc the authority in beijing the room to maneuver in terms of the fashion in their policy. the rise in price was the nikkei. because the dollar-yen rates so em to be steady and behaving themselves. so we broke a six or seven-day losing streak for the nikkei. not a great deal of conviction on the markets right now. underlying sentiment still fragile because of the external picture remaining sluggish. back to you now, guys. >> sri, thank you for the update. we'll look at the early european trade as well. europe in the green quite significantly as you can see. the dax up almost 2%. france up 1.25%. italy is in the red because the italian banks are underperforming after the bank of populare said it needed to do
a capital raise. let's also have a look at the currency markets this morning. we saw the nikkei turn in a good performance because of the yen weakness. and it's broadly a u.s. dollar strength story today also, but the euro is moving down a little bit. the pound, however, getting some strength but not too significantly, 1.4452. the massive wild near in canada has consumed 400,000 acres and continues to rage. but the officials are feeling more optimistic with the cooler temperatures and the slight rain to get a handle on the biggest devastation in the oil stands region. more than 80,000 people have been evacuated from fort mcmurray once known as the canadian oil boontown. the fires destroyed 1600 homes and buildings in the region. and the wildfire has knocked out over a million barrels in daily
production capacity. as those numbers begin to add up, oil is rising. 11 production firms and three pipeline operators have curbed activity taking precautionary steps as a result of the fire. bp and other major oil firms have warned they won't be able to deliver on some contracts. having said that, we're still talking about a 2% move in the price of oil. so yes, elevated higher on the back of the strength last week, but still nothing crazy at this hour. wti is back above $45 a barrel. 45.59. brent above 46 at 46.08. the other story impacting oil today is a shake-up in saudi arabia. king salman replacing his long-time oil minister with khalid al-falih who previously ran aramco. mohammed bil salman says it will
likely change policy next month. >> we have been reading what this means for the price going forward. we talked to a guest earlier, the bottom line is not much in terms of the direction or the outlook for the price of oil. maybe the new minister will be somewhat more communicative to the markets which could be slightly bearish if something were getting out of the research notes going forward, but it's a continuation of what has been the new crown prince's strategy on oil, taking saudi arabia and making it less dependent on oil imports. >> yes. that change is just being cemented. on the economic front following the jobs report on friday, there's no data today. starting tomorrow lookout for march wholesale trade. then on thursday the weekly jobless claims and import prices from april. then friday the retail sales, the producer price index and may
consumer sentiment. the pace of earnings is slow this week but there will be highlights. notably disney tomorrow as well as a host of retail names this week. we'll get macy's, kohl's and jcpenney, really all about the u.s. consumer this week. the latest lumberg gasoline price survey is out and landon dowdy is here with the details. >> lots of oil prices today. the lumberg survey prices at 25 stations in the continental u.s. the average price of regular gasoline jumping 9 cents over the past two weeks to $2.27 a gallon. in the past 12 weeks the price at the pump has risen 50 cents. lumberg says the price is due to higher oil prices. what is the city with the highest pump price? san francisco at $2.83 a gallon for regular unleaded according to lumberg. but it's a deal in baton rouge, louisiana, a the low price of $1.92 a gallon. guys, back over to you.
>> landon, thank you. >> still pretty low versus where we were a few years ago with the higher prices of oil. now for today's top trending stories, facebook, this is a big deal, winning a chinese trademark case against the company name facebook. analysts saying this could suggest attitudes could be softening to the social networking site in china. facebook has currently blocked the 700 million users. a court in the food production company facebook, a court said that the food production company that was trying to be called facebook, quote, violated moral principles and had intention to copy from the existing high-profile trademark. there will not be a food company in china called face book. >> two words. >> but the fact that the company cited facebook, i keep thinking mark zuckerberg running through
tianenman square. >> they had such strong growth in advertising sales on their outside of china platforms from chinese companies. so they still can't have chinese consumers using facebook, but chinese companies are selling lots of advertising to us and domestic business. >> can you imagine what would happen to those if they gaped more access? >> a huge success. drake is selling 1 million copies of his latest album in five days. the album was only available on apple's itunes and apple music. over the last year drake has hosted 20 episodes of his radio show on apple music. also using the platform to announce album release details and to debut several songs including his hit "hotline bling." >> i know someone obsessed with drake and has every single song. a new start-up wants to help you learn from the best and it only costs $90 per class. the start-up is called master
class and it's actually offering acting classes with kevin spacey. wilfred, you could benefit from that. >> $100, are you saying i need it? >> i'm just saying that since you have tried to play him in the past, he could probably give you tips. >>ed $100 is well worth it. >> you can also sign up for singing classes with christina aguilera. >> it's a very good idea. access to good individuals. >> you could give anchoring lessons. >> i'm not sure anyone will want to sign up for that. but i'll do it for free if anyone is interested but i bet no one will come in. and stay tuned, you're watching cnbc, first in business
...in her kitchen yup, she's gone noseblind. she thinks it smells fine, but her guests smell this. ding, flies, meow febreze air effects heavy duty has up to... ...two times the odor-eliminating power to... ...remove odors you've done noseblind to [inhales] mmm. use febreze air effects, till it's fresh and try febreze small spaces... ...to continuously eliminate up to two times the odors... ...for 30 days febreze small spaces and air effects, two more ways... [inhale + exhale mnemonic] to breathe happy. welcome back to "worldwide exchange." to today's must reads and the title from "the washington post"," democrats don't celebrate trump's nomination. fear it. so what if even voters who respect hillary clinton ice competence reject her as the embodiment of business as usual. and what if even voters who do not like trump's bigotry or
bluster care more that he will, in their view, shake things up? it's more on the anti-establishment type sentiment will overpower any fundamentals or particular policy areas that trump goes for. and that's really going to be one of the big swing factors as this plays out, the anti-establishment vote, does it overweigh policy issues that clinton might win it? >> because, because one is the ultimate establishment pick and the other is the ultimate anti-establishment pick. i went to "the wall street journal" on bobby jindal who threw his hat in the presidential race early in the cycle and he wrote, why i'm voting for trump, warts and all. this is a depressing read where he outlines every reason he can't stand donald trump. but is going to end up voting for him. quote, i'm not pretending donald trump has suddenly become a conservative champ i don't know on a reliable republican.
he is completely unpredictable. the problem is that hillary is predictably liberal. it would be better to vote for a candidate rather than simply against one. if current trends hold, i will be among the many complaining this fall about my choices. she is too liberal and is not going to follow the footsteps of her husband, for instance, reaching across the aisle and putting in place more sort of centrist policies. it's just sort of a sad state of the republican race where you have a prominent republican coming out and saying i'm voting trump but i really don't want to. >> i think we're going to see more of those slightly liberal things come out of donald trump in the weeks ahead. the tax policy, increasing the tax for the wealthy. there are aspect there is where there is overlap at least, but certainly clinton is more liberal. >> but she moved farther to the left as well is the point. right. still to come on "worldwide exchange," oil prices are rising
and u.s. prices are pointing to a positive open on wall street. we'll get you ready for the day and week ahead with jeff kleintop from charles schwab. stay tuned, you're watching cnbc. whole communities are living on mars and solar satellites provide earth with unlimited clean power. in less than a century, boeing took the world from seaplanes to space planes, across the universe and beyond. and if you thought that was amazing, you just wait. ♪
olay. ageless. and try the micro-sculpting cream you love now with lightweight spf 30. welcome back to "worldwide exchange. "we are approaching the top of the hour, which means becky quick is joining us from new york with a look at what is coming up. good morning to you, becky. >> good morning, wilfred. great to see you guys. we have a lot of things coming up. we are talking oil prices. obviously, the change in the saudi oil minister over the weekend creating some concern, creating some confusion. we're going to dig right into that right off the top with john kilduff to try to get our arms around that. obviously we'll be talking about the markets and what is happening heading into the new week. and we have bill crystal, the weekly standard's founder. he's leading part of the movement of conservatives
against trump. obviously a lot of questions are taking place, not only in the republican party but also what is happening in the democratic party. there's warnings over the weekend that maybe the bernie sanders people need to get in line. so there's a lot of questions swirling around both political parties. we'll dig into that today. plus, two former secretaries of defense joining us this morning, william cohen and chuck hagel. we'll be sitting down to talk to them about what they are expecting in terms of defense, what some of the biggest issues are facing the country this time around. what they think the huge security issues are. so all of those things are coming up. and it's going to be starting in just about ten minutes' time. >> that's a power duo. >> yes, exactly. >> all right. thank you. becky quick. meantime, u.s. future equities pointing to a higher start. dow futures up 54. the s&p futures up 7. joining us to discuss the day and week ahead from boston is jeff kleintop, chief investment
strategist at charles schwab. excuse me, jeff, good morning. >> good morning, thank you for having me. >> so as far as data, we're a little light this week, but we do come off of last week with serious questions about whether u.s. growth is yet again slowing down as evidence by the latest sort of weaker jobs report. what say you? >> well, the world does seem to look for a global growth to be led by the u.s. and some of the data has been a little disappointing lately, but you know what is interesting, sara, the data out of europe is pretty strong. i'm not just talking qn gdp which was 2.4%, practically a blowout numbers. the pmi numbers this weekend, we got a look at the export data. it was negative 9% year over year. to europe, plus 3, europe might be the bright spot in the global economy rather than looking to leadership from the u.s. >> but the european markets have not rebounded to the same level
as the u.s. since that mid-february low. so does that suggest lack of confidence in that rebound or that it's temporary in nature? >> well, it suggests there are still a few psychological headwinds. we have a brexit vote coming up and a look at the greek aid train traunch coming out this week as we look ahead to the greek payments. certainly the migrant crisis is going on. there are a number of issues europe is dealing with, but most of them are politically oriented. the fundamentals have been improving and stocks are beginning to show that. >> jeff, what about the fundamentals in china with disappointing trade data this morning? last week a couple of data releases which also were softer than expected. >> yeah, there's a mixed data picture for china as opposed to the steady decelerating picture we saw for much of late last year. the pmis have stabilized, that's an important leading indicator. the private sector surveys have
shown a little better readings as well. we had an interesting shift in the chinese new year this year. and that's had an effect on the february/march and now into the april data a little bit. certainly things aren't booming in china, they continue to slow, but they don't appear to be crashing. >> what is interesting, though, is weak china data, weak reaction to the chinese market yet futures are higher on the back of the strong oil prices. it all comes down to the price of oil yet again. >> it sure does. if you look across profits, profits are the key driver for the stock market. the one sector that is holding back profits so dramatically is the energy sector. if, in fact, we get oil prices to stabilize on a year-over-year basis, by the way, they are nearly there come june or july. we'll nearly get there. that will reduce that drag on profits, maybe even turn profits positive in the second half of the year. that's a key thing stocks are hanging on no doubt about it. >> what about the u.s. dollar as well, jeff, the weakness we have seen over the last month or so has helped market sentiment.
it hasn't seemed to really help companies earnings yet or their guidance for the rest of the year. why aren't we seeing that affect the fundamentals even more? >> that's an interesting point. there hasn't been a lot of grassroots support for spending in terms of the consumers rae stepping up their activity. there's not a lot for business leaders to get excited about. i'm encouraged they are not continuing to take numbers down dramatically. in fact, some regions of the world have seen upward revisions, in europe, for example, but they have been modest. we have not seen a real turnaround there to weigh on the markets. i will argue that there's still a lot of volatility in stocks rather than continued to move to the up side. >> you mentioned energy profits weighing on earnings overall, but there have been disappointments notably out of technology and the largest chunk of the s&p 500 has been really disappointment over the season.
what are you seeing in terms of rebounds in tech? and would you be buying on the rebound of the stock? >> it's hard to see a lot of the signs that tech spending is beginning to turn around. there are a few indications things are looking better, but the real key is just the sentiment change in the capex outlook. it's more of a 2017 story. i do think the technology sector is attractive longer term as we get to the point later in the business cycle where you usually see businesses step up their spending on capital goods. so that is still to come, that's a profit of the future spending that we have yet to see delivered upon. so it's still a little bit of a hope, but the technology sector looking more attractive, not the high flyer social media names but more of the business spending oriented technology companies that typically at this point in the cycle tend to leave. >> what other sectors are you in at this point, are you looking for companies exposed to injure? it sounds like you like europe.
>> i do like europe. i think that is an attractive area. you talk about the big sector exposure in the u.s., the financials make up the bulk of the european stock market. they look pretty good, not only because interest rates here in the u.s. are starting to move a little up providing some relief, but loan growth particularly in europe is now coming back in a much larger way. that is really important to finally get margins moving a bit higher there. so like financials, particularly in europe over the course of this year. >> jeff, thank you very much for joining us this morning. much appreciated. jeff kleintop from charles schwab. we have a minute or so left. i'm picking out the chinese shanghai stock market. we have seen a much, much bigger recovery in confidence than the start of the year with the shanghai composite down 4% today. 6.5% over the last month or so. but look at the slide we have seen over the last week towards
the end of that chart. just disappointing data. we had the trade data last week. services in the pmi wasn't great and the unofficial manufacturing pmi was worse than the official numbers. keep an eye on china with the data over the last week not great. >> i'm watching oil, that's the key to this market in terms of direction. futures are higher along with the price of oil. trying to digest two big stories that are moving the oil market this morning. on one hand we have slight concerns with the wildfires raging in canada. then the other regime shift in terms of cabinet reshuffling in saudi arabia, what might that mean going forward? it doesn't seem like a lot in the near term as far as the research this morning, but we'll ke keep an eye on what saudi is doing. >> we are still settled around 45, much better than earlier this year. futures at the moment are pointing to a higher open, about .40% to .50%.
the nasdaq and dow saw two weeks of declines expected to bounce back from that. that is it for "worldwide exchange." "squawk box" is coming up next. now you can, with the luxuriously transformed 2016 lexus es and es hybrid. ♪ and that a tired dog is a good dog. [ dog barking, crashing ] so when you need a dog walker or a handyman, we can help you get the job done right, guaranteed. get started today at angie's list.
good morning. crude prices rising following a cabinet reshuffle in saudi arabia. and a raging wildfire near canada's oil sands taking a toll on production. meanwhile, protests in greece turning violent as parliament passed new austerity measures. that vote came just ahead and just hours ahead of the emergency eurozone meeting on greece that takes place today. and the race for the white house, why donald trump says he's open to raising taxes on the rich. it's monday, may 9, 2016. "squawk box" begins right now. ♪
>> live from new york where business never sleeps, this is "squawk box." >> good morning, everyone. welcome to "squawk box" here on cnbc. i'm becky quick. andrew ross sorkin is out today. the dow futures are up by about 40%. the s&p futures are up by 6. this comes after the nikkei was up by .70%. the shanghai composite was down. early going, you'll see in europe that things are stronger across the board. dax and germany are up by 1.86%. we have a developing story out of canada impacting the oil markets. a wildfire h