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tv   Worldwide Exchange  CNBC  September 19, 2016 5:00am-6:01am EDT

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breaking overnight, another device is found in new jersey. and could the fed be a game changer this week? we're counting you down to the big decision. plus the emmy goes to -- big wins for "veep" and "game of tl thrones." september 19 is the day today. welcome to "worldwide exchange."
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good morning. welcome to "worldwide exchange" on cnbc. i'm kara eisen. >> i'm wilfred frost. security is tight today after multiple explosions in the new york area and a stabbing over minnesota this weekend. we'll have the latest on those developments in a molt. but first a quick check on markets this morning. it does look like we are pointed higher after a volatile last week ended in the green. an outperformance by the technology group and apple, in particular, helped put the stock market over the edge despite a friday sell-off. dow futures are up 93 points in the early session here. s&p futures are up almost 10. and nasdaq futures are up about 22 points. as for the ten-year treasury yield, a big week of not just the fed, but the bank of japan meetings as well, the ten-year yield ticked a bit higher on friday after the u.s. price index inflation data came out a little higher. 0.2%, moving in the right
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direction. still that only put the odds of a rate hike this week back to 20%. 55%, though, for december. the all-important fed will talk a lot more about that. >> absolutely right. tech is the best performing sector. banks the worst performing, although yields were ticking up during the week. of course, it was not expectations of a rate hike. so banks did suffer despite the rate, the yields ticking up. and in the face of the wells fargo scandal and deutsche bank selling off on friday, so banks losing 2% last week. >> but apple's best week since 2007 helped offset that. the nasdaq had the best week in two months. and the s&p tech sectors best week since may. >> indeed. apple up over 11% last week. let's switch focus back to this morning's top story. another explosion overnight in elizabeth, new jersey, after a backpack that appeared to contain a pipe bomb detonated. several law enforcement officials tell nbc news they are connected. that an active terrorism cell with multiple players could be
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at work. morgan brennan is joining us from new york city with all the latest. morgan, good morning. >> reporter: hey, good morning. so it was a weekend of terror after multiple explosions really rocked manhattan and new jersey. just hours ago a backpack containing as many as five bombs detonated after police responded to a call about a suspicious package in a garbage can at the elizabeth, new jersey, train station. it exploded while a robot was cutting the wires on the device. the mayor of elizabeth spoke not long after. >> extremely concerning per the residents of the community, but more importantly extremely concerning where everybody can just go and drop a backpack into a garbage can that has multiple explosives in it, with no timers. and then you have to wonder, how many people could have been hurt? >> reporter: this wasn't the only incident in new jersey. saturday morning a bomb explode in a garbage can at a 5k charity
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run for marines in seaside park, new jersey. no one was injured there. and just in the chelsea neighborhood of manhattan on the street behind me, 23rd street, a separate incident involving another bomb explosion on saturday night. that sent 29 people to the hospital. all have since been released. just four blocks away from here, a second device, what authorities described as a pressure cooker device, similar to the one use in the 2013 boston marathon bombing. it was also discovered. police led a controlled detonation of the device last night. now authorities haven't officially connected all of these incidents. they are saying at least three had similarities, specifically the involvement of old-style mobile flip-phones. as far as suspects, the fbi says five individuals have been detained. this is for questioning related to the new york city explosion. and nbc news reporting surveillance footage in this area shows what could be the same person at both manhattan sites. all of this in addition to a knife attack at a mall in
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minnesota that injured nine people. in which isis is already claiming credit for. but all of these investigations are still very much ongoing. a lot can and will change as more details come out. meantime, here in the city, security which was already stronger than usual is being dramatically boosted because, guys, remember, we have the united nations general assembly kicking off here in manhattan as well. back over to you. >> so you're in chelsea where we saw the blast on saturday night, morgan, are the streets still closed? i imagine there are a lot of law enforcement officials still out there, both city, state and federal, correct? >> reporter: that is correct. this street, which is 23rd street where the bomb explosion took place, as you can see right here behind me, is still very much closed. it's still an active investigation site. i will say, the subways in this area and the mass transit is up and running again. authorities here telling me that this is going to be closed for hours, if not for the rest of
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the day. but we'll bring you more as we get it. guys? >> morgan brennan, thank you for the update. still plenty of questions and a lot of unease. now back to the markets, we'll show you what is happening in europe here in the early action of trade. monday morning, we are seeing green on the screen. perhaps contributing to the rise that we're seeing in u.s. equity futures. italy is a notable outperformer as well as the ftse, 100. france up 1.3%. the german dax up .80%. a bounce back from last week. >> we had volatility in the u.s. throughout the week, but the markets ended in positive territory for the most part. >> not in europe. in asia japan was closed today for an australia holiday. and there was a technical glitch to halt trading there with the index closing flat. hong kong and shanghai, we saw
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gains after the markets were closed at the end of the week. japan, an under performer last week, will close down 2% ahead of a very important central bank meeting in which economists are split as to whether the bank of japan will ramp up stimpolice effo bus /* efforts. >> given the expectation for the fed action has been so massively diminished in the last couple of weeks we don't expect it anymore. but perhaps this is the most important of the two for u.s. markets. because if they do underwell and we see a significant move in the bond upwards and it's a trend globally led by the bank of japan and secondly by the european bond markets as well, that could be a bad risk off sentiment move for markets generally, if they don't deliver enough ease. >> sore if they deliver the wrong easing. there's rumor miss the press they could cut rates into negative territory.
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the japanese yen has strengthened. the stock market has languished. at the alpha conference last week, so many hedge fund managers were calling out central banks everywhere for maxing out policy extremism. but especially pointing their finger at the bank of japan saying i can't do anything more. >> either way, the bank of japan has a tough agenda on its item this week. two big meetings coming later. we'll look at the broader markets quickly. the dollar for you just there as you can see, a decent move in the yen, higher by half a percent. the pound up, rebounding a little bit today up also half a percent. gold prices quickly have sold off a little bit last week losing 2% and are bouncing back 0.70% this week. algeria's news agency announces opec's secretary general will make an extraordinary meeting to discuss
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prices if members reach an agreement at an informal gathering in algiers last week. meanwhile, tehran supports any move to stabilize the global market and lift prices. as you can see, oil 43.70 this morning up 1.5%. but it's third negative week in four last week, wti slipping 6.2%. retail gasoline prices are surging in parts of the united states because of continued problems with colonial pipelines gas line. it carries fuel to the east coast. colonial has started to construct the bypass line because of a leak. aaa reports the average price of a gallon of regular fuel in georgia jumped to $2.26, and prices rose by 4 cents in the carolinas. on the economy front, the fed as we mentioned takes center stage this week with policy decision due to 2 p.m. on
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western. among other data points to watch this week, the national association of home builders releases the monthly survey today. then tomorrow we get august housing starts. on thursday, jobless claims and august existing home sales. and then an earning central no notable names reporting this week. there are some reporting this week including general mills and bed bath & bond. some more stocks to watch, samsung says to watch for additional investment in the core business. they sold half their shares with the holdings worth more than a billion dollars based on friday's closing prices. samsung is up 2%. and sanofi is suing merck for the blockbuster diabetes drug lantus and the insulin delivery
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device. sanofi filed suit after merck's new drug applications with the fda. and stocks are up with the rest of the market. microsoft is closing the skype office in london. the financial times says the company is streamlining engineering positions. microsoft bought skype for $8.5 million but has seen a drop. a union representing thousands of auto workers in canada will strike at two general motors plans. tonight if the deadline passes without an agreement. a lockout could disrupt production on engines that go into gm's suvs. the private sector union has designated them in a company to join discussions with ford and fiat chrysler. wells fargo is being sued in the scandal over the opening of the sham accounts.
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the lawsuit filed on friday is seeking class-action status. earlier this month wells agreed to pay $190 million to settle charges of employees opening 2 million accounts without customers' knowledge to help meet sales targets. the u.s. prosecutors opened the investigation into wells fargo's practices. the ceo john stump is set to testify at a senate hearing tomorrow. all eyes on that. wells rebounding a percent in the free market today. it slid 9% since -- that news broke. >> that's a big deal. >> interesting, because i think generally there's a sense that we haven't seen enough of an admission of guilt from the powers that be at wells fargo. as we said, there are $185 million fines set aside for potential claims. it's not groundbreaking. the question is fundamentally, is their earnings going to change. so far has been been enough guilt taken on the shares. >> with broken trust for consumers, which is a big deal. 5300 employees with no
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management being held responsible. >> so far the company is saying it hasn't changed customer behavior. of course, this has been running for quite some time as well. we'll have to see. coming up, two big central bank decisions. we'll get you ready for the decision. kit juckes is here. stay with us, you're watching cnbc, first in business worldwide with a nearly 100-point rally here for u.s. equity futures. load t new app? we're good. okay... what if a million people download the new app? we're good. five million? good. we scale on demand. hybrid infrastructure, boom. ok. what if 30 million people download the app? we're not good. we're total heroes. scale on demand with the number one company in cloud infrastructure. hewlett packard enterprise. it's a very specific moment, the launch window. we have to be very precise. if we're not ready when the planets are perfectly aligned,
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good morning. we are called higher watching the markets this morning. last week we did just about end positive. the dow and s&p were around flat. the nasdaq was up over 2%. tech as a sector was drawn higher by apple's gains of 11.4%. fantastic week for apple to help the nasdaq out perform other indices. all three are up half a percent this morning. oil prices were soft last week, three negative weeks out of four. oil down over 6% for the week as a whole. again, bouncing back this morning similar to some of the other markets. wti crude pulled higher by 43.7. sara? important political news over the weekend, angela merkel's party suffered another setback. this weekend the center left social democrats whipping an election sunday night in a vote that propelled an upstart anti-immigration party in germany into its tenth state legislature.
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the strong showing stems from many upset voters with merkel's policy that allowed more than 1 million refugees to come to germany the last year. she continues to face pressure over this policy. >> you're absolutely right. a big election next year. these are the regional state legislatures, but a sign of things to come for the big election next year in germany. meanwhile, ecb policymaker weidmann comments on how this could impact the financial firms. he says many will lose pass porting rights allowing them to cross the union. this would be a huge blow to britain's financial industry. of course, it will be a crucial area with the ecb not part of the discussion, but his view is one to take note of. back to global markets on a big week for the feds and the bank of japan, joining us is kit
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juckes from societe generale. thank you for joining us. which is the most important thing to focus on this week? >> well, which is more important? i guess directly the fed. the chances are that the most important thing is how to set us up. you said earlier we're scraping the bottom of the barrel. we are scraping the bottom of the jam jar, if we can get enough jam for a crumpet but not for a meal. >> that's a great british analogy there. >> we are working hard to keep the british theme going this morning. but the key thing for me is the sense of the ten-year u.s. treasury yields going to be heading up towards 2% or certainly back towards 1.5%. and i think that anything the fed reserve does, which makes it clear that, yeah, we're still going higher, yeah, as of the central bank running out of ammunition, we think the markets should be pricing in a move in december. i think that keeps bond markets
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on the back foot and that is where the danger is for risk sentiment right across the world. >> is there any chance that the fed just does it, just raises rates and says, yes, there is a trend with it weakening a bit, but they are still pointing to a healthy recovery with inflation moving to the target. up employment continues to improve and we're going to raise rates. >> yeah, the last time the fed really surprised markets by raising rates when it wasn't expected was in 1994. but ever since then it's kind of been received wisdom for folks like me that they don't want to do that again. but this is the most cautious fomc since then for sure, possibly for even longer, i don't know. so incredibly cautious. i think it is more likely that they want to make sure that the market is ready for them to move, if the danger in the next six weeks are fine, and to go again before the end of the year rather than risk the reaction of going when they haven't got the market in the right place.
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but this is all guessing at this point in time in terms of that. but it would seem to me that is more likely. >> kit, we have seen yields tick up although expectations of a rate hike have been pushed back, what level of yields have we hit for example in the ten-year would you start to get seriously worried on that this was the bursting of the bond bubble in the recent years? >> well, i think you would have to get well on the side of 2%. in a sense, it's not -- it's not so much bursting a bubble at this point in time, it's fatigue that -- why would you want to own government bonds anywhere with negative yields instead of putting your money in cash? what can central banks do if we know they would like steeper yield curves to keep the financial system viable? those are the questions we ask around. generally, we see that the support for global bond markets is fading a little bit. if what we do, we have seen the low in treasury yields and the ten-year yield is, somewhere at one point, somewhere below 2%.
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big deal. it's an overshoot spike significantly above that that would have much more collateral damage. but i don't see a big bear market in bonds. i just think we have seen the low in yields for quite a long time. >> what about the dollar? what do you do with the dollar, are you buying it into the fed meeting whether or not they raise rates september, december or maybe early next year? >> yeah, i think the dollar, which has been largely moving sidewalks against the euro and yen for months now, which has lost ground over the summer, all those lazy, those comfortable easy carry trades that we saw as people were hunting yield over the summer. i think we can still unwind more of that if markets are encouraged to price in a rate hike down the road with more conviction. i think those trends can be taken off as people take bets off. a much sharper dollar move seems unlikely at this point, we're not -- we're fine-tuning a fed
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story and we're trying to cope with the end of the cycle in monetary policy over the bank of japan. >> kit, thank you for joining us this morning. much appreciated. kit juckes. there. coming up, the presidential candidates react to the bomb attack. we'll tell you what hillary clinton and donald trump are saying, next. now that fedex has helped us simplify our e-commerce, we could focus on bigger issues, like our passive aggressive environment. we're not passive aggressive. hey, hey, hey, there are no bad suggestions here... no matter how lame they are.
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well said, ann. i've always admired how you just say what's in your head, without thinking. very brave. good point ted. you're living proof that looks aren't everything. thank you. welcome. so, fedex helped simplify our e-commerce business and this is not a passive aggressive environment. i just wanted to say, you guys are doing a great job. what's that supposed to mean? fedex. helping small business simplify e-commerce. it's what the national debt could do to our economy. if we don't solve our debt problem 19 trillion and growing money for programs like education will shrink. in just 8 years, interest on the debt will be our third largest federal program. bad news for small businesses. the good news? there's still time for a solution. ask the candidates for a plan to secure our future.
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welcome back.
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and good morning. this is "worldwide exchange." we are looking at a pretty nice rally. triple-digit gains here in the early action starting the week on a high note for stocks. s&p futures are up 11.5%. the s&p futures are up 25 points. what is fueling this moment? europe is in the green. the ftse 100 is up half a percent. and oil is rebounding from a tough week. wti is up 43.66. it is up 1.5%. brent is up above as well. and there is still a sentiment driver here for oil. perhaps not tick for tick like we were seeing earlier this year, but certainly it impacts the energy stocks in the overall market. >> absolutely right, sara. thank you for that. now to politics, today marks 50 days until the presidential election. we are joined live from washington with all the latest from the campaign trail.
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edward lawrence, good morning. >> reporter: good morning. this is coming down to the end now. 50 days left for voters to decide who they want for president. donald trump used the weekend bombings and stabbing attack to separate himself, tweeting the failed obama/hillary clinton policies won't keep us safe. hillary clinton also reacted to the attacks from this weekend. >> obviously, we need to do everything we can to support our first responders. also to pray for the victims. we have to let this investigation unfold. >> reporter: this may become a focus for the candidates this week. clinton running with senator tim kaine says the latest call for clinton to disarm is part of the dangerous rhetoric coming from the republican nominee. >> i do believe it is an insight or at a minimum expression to indifference on whether violence
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will occur. >> reporter: trump said it's due to clinton's views on gun control. he's shying away from previous birther comments when his vice presidential candidate stating that's old news. >> donald trump has been focusing on issues the american people really care about. and he brought this issue to an end. >> reporter: in a new quinnipiac poll, it shows hillary clinton is losing ground among younger voters. her lead is down to just five points over donald trump with voters under 35 years old. >> thank you very much for that. still to come on "worldwide exchange, today's top stories with a rally in equity futures over the last hour or. so we'll bring you that much more and preview the week ahead. stay tuned, you're watching "worldwide exchange" on cnbc.
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breaking overnight, another explosive found in new jersey. the device detonated the bomb squad robot examined a suspicious backpack found near a transit station. the latest straight ahead. the markets now, the oil prices are rising and the u.s. equity futures are up triple digits. the round-up of the biggest movers coming up. "harry potter" fans listen up. if you want to listen in the cupboard under the stairs? this could be something to take a look at. all that and much more are coming up on "worldwide exchange."
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good morning and welcome back to "worldwide exchange" on cnbc. i'm sara eisen. >> and i'm wilfred frost. a very good morning from me as well. we'll check in on the markets at this hour, last week we saw a slight gain for the dow, the s&p fractionally negative. the nasdaq, though, much -- by much distance up 2%. this is after apple's great performance gaining 11% last week. we are expecting to open positive this morning as the dow is just hitting triple-digit gains in the futures market. the nasdaq is up 23 points. all eyes on the fed this week, will they or won't they hike expectations. certainly they have been diminished for a hike in the last week or so. >> feels like oil is higher, which is better for sentiment. yields are lower. and europe is also higher bouncing back from a tough week. and all that is adding up to this rally. now we'll get to this morning's top story.
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another explosion overnight. this one in elizabeth, new jersey, after a backpack that appeared to contain a pipe bomb detonated. several law enforcement officials telling nbc news they are concerned an active terrorism cell with multiple players could be at work here. our morgan brennan is joining us from new york city with the very latest. good morning, morgan. >> reporter: good morning, sara. it was certainly a weekend of terror with multiple bombs exploding in new york and new jersey. and here's the latest, just hours ago a backpack with five bombs detonated after police responded to a call about a suspicious package in a garbage can near the elizabeth, new jersey, train station. that exploded while a robot cut a wire on it. the mayor of elizabeth speaking not long after that. >> extremely concern for the residents of the community, but more importantly extremely concern for everybody in the state in the country where somebody can just go and drop a backpack into a garbage can that
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has multiple explosives in it with no timers. and then you have to wonder, how many people could have been hurt? >> reporter: now amtrak did suspend service overnight in the midst of this active investigation. but the train, the railroad saying it is now beginning to reinstate service on a modified schedule. now this wasn't the only incident in new jersey, however. saturday morning a bomb exploded in a garbage can at a 5k charity race for marines. here in the streets behind me in manhattan, a separate bomb explosion on saturday night sending 29 people to the hospital. all of them have thankfully been leased already. just four blocks from here we had a second device, what authorities described as a pressure cooker device similar to the one use in the 2013 boston marathon bombing. that was also discovered. police led a controlled detonation of that overnight. authorities haven't officially connected all of these incidents.
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but they do say that at least three have similarities, specifically the involvement of the old style mobile flip-phone. as far as suspects are concerned, the fbi had five individuals detained as of early this morning for questioning related to the new york city explosion. and nbc news also reporting surveillance footage in this area shows what may be the same person at both manhattan sites. but in addition to all of this, we had a knife attack at a mall in minnesota. that injured nine people on saturday. isis is already claiming credit for that. but keep in mind, all these are very much active investigations that are unfolding. there are going to be more details coming out, a lot could and will likely change. in terms of security here in new york city, that was already stronger. it's being boosted dramatically because remember, guys, we have the un general assembly kicking off in manhattan today. >> a terrible weekend for news. morgan brennan, thank you. we'll wait to hear any updates
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from you as nbc confirms them from new york. >> absolutely right. we'll switch focus back to markets and look at what is happening around the rest of the world. europe is higher. last week there was a lot of volatility in u.s. markets. so they ended flat to higher. that wasn't the case in europe where we did see markets decline. and that's why we're seeing europe higher at the moment today. decently higher as well, europe up over 1%. fuch futures are higher at 0.6%. particularly the likes of the ftse 100 up 1.5%. asia, let's have a look at that. the japanese market is closed again in hong kong on the back end of last week. higher as you can see this morning, hong kong and shanghai to the tune of 0.9% for hong kong that lies in asia on the back of bank of japan's meeting this week. and after a sell-off last
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week, among the reasons cited here for the 1.4% rise in wti. venezuela's president said to next and non-opec producers are close to reaching the output stabilizing deal. there's a big meeting in nigeria next week. meantime, there are possible concerns of supply disruptions amid clashes in libya. all that is adding up to oil starting the week on a higher note here. as for the ten-year treasury note yield, yields are coming up a lot after what many are phrasing, a week of reckoning for central banks with the fed and the bank of japan focus in yield. the ten-year yield sits below 170 at 169. we have inflation data on friday that is still relatively low. as for the dollar, it is drifting here ahead of the big policy meetings on wednesday. it's weaker against the euro. the low that is at 1.12.
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and the japanese yen, 101.91. the british pound is stronger st well. and asian markets are firming a bit this morning about a half percent. some stocks to watch today, rolls royce is cutting 200 more management jobs as part of the ongoing restructuring. the engine maker scrapped the heads of five units of the nuclear, marine and power systems. the stock is up in london 2%. novartis says a new drug to treat chronic heart failure can contribute to a higher quality of life. they launched the drug last week but failed to disappoint. and airbus tells "the financial times" that their plan is offsetting expensive delays to aircraft programs and
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minimizing losses on the a-380 super jumbo jet. it could include job cuts. twitter is being suled for misleading investors last year. a twitter investor is suing the company for the early false and misleading statements. their stock took a turn for the worst. the current cfo and ceo both claimed in the suit. they claim that they made false statements causing the stock to be inflated. it's been on the rise lately, 4% higher on what was considered a successful rollout of an nfl football game with millions of people tuning in on twitter. speaking of that entertainment news, as summer transitions to fall, the award season kicks into full gear. last night with the emmys, landon dowdy is here with highlights. >> good morning. you have to love the red carpet. the 68th primetime emmy awards kicking off last night.
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"game of thrones" took the top honor of whipping the outstanding drama sweeping away the golden statue to become the most garland show in history. it was up for 24 awards and came away with 12. meanwhile, "veep" starring julia-louis dreyfus nabbed the award for elite actress in a comedy series. the show has been awarded 42 times at the emmys. and at the people versus o.j. simpson racking up wins as well with three winners taking home gold statues. there was a big night was that "house of cards" had no wins whatsoever. i have to wonder, did people
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judging see the wilfred version's of a southern accent takes the cake. they can't hold a candle to it. >> i certainly agree with you on that, landon. outstanding for "game of thrones." 38 wins now. also at last night's emmy awards, the cast of "stranger things" delivered a late night snack to the audience handing out group bags with peanut butter and jelly and a note from jimmy kimmel's mom telling them not to, quote, get drunk. they were trying to copy ellen ordering pizza. "stranger things" won the pre-show. >> they were adorable and nabbed it. they are the most popular people there. another trending story, how in terms of england they could own
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a magical property. the home of harry potter is on the market. it is more known for the private drive that was use in the first "harry potter" film. the current openers renovated the estate and it is listed for 470,000 pounds. i don't know the premium they put on it, simply because it was used in one of the films. good for them because they made money on it. >> but do you think people recognize it? is it recognizable? i'm sure for super fans definitely. >> it seems like a lot, $475,000. a video of a map claiming to have a new iphone 7 hack caught the attention of over 3 million youtube viewers. the hack promises a solution to iphone 7's lack of a headphone jack. the man drills a hole where the headphone jack is located on previous iphone models and easily plugs in the headphones. but the problem is it's a total hoax. more than a few viewers didn't know and ruined their phones.
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>> of course they haven't. no one would actually drill a hole. >> i guess it worked. >> more than a few people, to be critical, if those people have done that, are foolish as hell. you can't drill a hole and expect it to work. >> there's a loot of rage out there for the lack of the headphone jacks. >> i agree on that part. >> we'll see if people can adapt to the change. still to come on "worldwide exchange," we are almost half a percentage higher. we are back in just a moment. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley
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the fed is putting too much emphasis on the business cycle and not enough on the long-term business cycle. and i don't think they are paying enough attention to how markets react relative to what is discounted in the curve. >> the idea that you should raise rates to replenish the arsenal and slow the economy, that's a weird argument to me. it's not true that the major governments are completely out of ammunition. >> those were two titans talking monetary policy at the alpha conference last week. starting today you can watch the entire discussion can former secretary tim geithner.
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i picked this story from "usa today" entitled why we stand for the flag. he was the chairman of the joint chief weighing in on the fact that athletes and others were kneeling for the anthem. he writes, i hope that the athletes who are using the anthem as a protest, i understand why people like me intend to keep standing during the national anthem. we do so not because we agree with everything america has done or everything that has been done in america's name, but because despite all of that the world is a better place because america exists. he doesn't go after the athletes or criticizes them, but he explains how he feels the feelings they feel about the fact that things could change and be better but will always stand despite that during the national anthem. >> it's a good positive take on
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why to continue standing even without criticizing those that aren't. my pick is from "the financial times" entitled what will be the bank of japan and fed do? it's a good summary of the key questions ahead of two mass central bank decisions due later in the week that reads, the federal reserve and the bank of japan will jostle for attention on wednesday when they both get their latest decisions on monetary policy. unless the fed surprises by raising rates, if the governor of bank of japan will most likely be watched with the central bank of japan's take away. because the expectations from the fed have been diminished in recent weeks, the bank of japan is the most important of the two. because what is the action going to be from the bank of japan? is it enough to replicate the rece recent unease with lack of
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control? >> we are looking at the possibility of them buying more stocks, but they are already buying a lot of itfs, you name it. >> there needs to be action in the market. they are expecting it, but there are not many things they can do. the fed is not expecting action, so i think no action doesn't lead to moving markets, whereas in the bank of japan, you know, we're probably going to see a market move. >> action and reaction will be very important. we are approaching the top of the hour, so that means the team is getting ready for "squawk box." becky quick is joining us live from new york. i'm sure you'll continue though this conversation with heavy bank focused. >> one of the things we are focusing on with the central banks, what to expect from the fed this week, we have a great lineup of guests to go through the issues. former secretary of the treasury hank paulson will be our special guest this morning. he'll be with us for a half hour to talk through all the issues. we'll get his perspective on how
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far we have come not only when it comes to the economy here, what the feds should be doing, and what he sees happening with global trade, particularly with china. with deep ties to china. we'll let you know how things are going with our relationship with china at this point, too. we're also going to be talking to walter isaacson from the aspen institute. somebody who has been putting together a lot of the issues we have been following in business. everything from what has been happening with the epipen to wells fargo. believe it or not, he sees ties between the two issues. we'll dive into all these things with walter as. we. and we'll be talking to ken burns with a new documentary out called defying the nazis. he's tracking this through and says this is one of the projects he's been most engaged in, most have drawn into this along the way. so we do have a big guest list with a big week in new york city. we have the un meeting here. you have the clinton global initiative. a lot of traffic and concerns with what is happening with terrorism over the weekend.
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we'll start things off talking about what happened here in new york city, what is continuing to be a story. we are joined at the top of the show to discuss that, too. right now i'll send it back over to you. >> we look forward to "squawk box" in ten minutes' time. still to come, john silvia, chief economist at wells fargo security will have us get ready for the week's big fed meeting. stay tuned, you're watching "worldwide exchange" on cnbc. ea. attaboy. wait, todd, what are you doing? how totally selfish and un-toddlike of you. come on, todd, come on, man. it's scary when the lights go out. people get anxious and my office gets flooded with calls. so many things can go wrong.
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welcome back to "worldwide exchange." futures in the u.s. have having a nice rally. they are up 85 points in the dow. s&p up 9. the nasdaq futures are up 20 after the best week for the nasdaq in two months. and ahead of a very big central bank decision from the fed, joining us from charlotte is john silvia at wells fargo security. good morning to you, john. >> reporter: good morning. >> is there any chance that the fed could pull a rate hike
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surprise this week? >> a very small chance. i think when you look at the industrial production and retail sales numbers last week, they were kind of disappointing. this week we see better housing data. and overall, when you look at the overall flow of the economy, domestic sales is pretty good. inflation is creeping up. but there is really no incentive to move quite yet, especially in front of an election. >> john, what can we expect then in terms of markets between now and say december, the next meeting when this will be a question again? because we saw a lot of rotation in the summer expecting a hike, and now that is a drawn line again. >> yeah, that is one of the challenges of being so data dependent on short-run data. so you get this roller coaster of volatility as some people would say, but that would be my expectation in the marketplace for the rest of this year. plus, the sense that you're going to get slightly better economic data the second half of the year.
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so maybe ten-year yields move up a little bit. and then finally beyond the fed, look at the bank of japan this week. you probably know rate change. i think that there's a sentiment that negative interest rates and rate changes aren't going to do it. but there may be more bond purchases in the future or etf futures perhaps in the future by the bank of japan. that may influence markets. but i think you're quite right, a lot of the volatility in the marketplace throughout the rest of the year. again, in respect to and in addition to the election. >> i was just going to ask about that with 50 days to go, john, how you think the recent surge in momentum of donald trump as a front-runner in the presidential election will impact the market and the economy into the election. >> well, i would say anticipate change. for hillary, there's probably a little bit of a continuation, to some extent, president obama's policies. but whenever we have a change in
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policy, i think analysts, economists like myself, fixed analysts, they step back to say, what are the reasonable policy change that is can be put in place that will change our expected future path for either interest rates and/or corporate profits. and i think change is the big story. we need to take it into our calculus in terms of the gathering momentum for donald trump at this point. >> john, either way, both the candidates are talking about significant infrastructure spending and fiscal policy stimulus. is that something that means once we get over this uncertainty in terms of who the candidate will be, the president will be, that if either of them delivers a fiscal policy stimulus that the economy should pick up significantly next year? >> yeah, i think there are two lines of thinking here. one, over the last three to five years, it's become more and more apparent to people that we need some fiscal stimulus.
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the monetary policy can only go so far. and i think a second aspect is, yes, some infrastructure spending well thought out, not just spend money, but look at the benefit cost analysis, will add to economic growth in the next year or two. certainly in some more industrial areas, areas that haven't really participate in the overall growth of the economy. >> yeah, i mean, it depends on what happens with congress and whether they will even pass that and who gets that. but john, quickly, this week we have a lot of housing data. quickly, what do you expect? >> continued improvement. continued sense that better job growth, low interest rates really help the housing market overall for the economy. >> all right. we'll see what the numbers show starting with the survey of home builders today. john silvia, thank you. >> quickly, what are you watching? >> tech because that was the outperformer last week.
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we saw the tech market jump overnight with apple still riding the wave. >> i'm watching the banks. wells fargo was the worst performer last week. that's it for "worldwide exchange." "squawk box" is up next. announcer: alvin and the chipmunks want to remind you-- bacteria can hide in food and make you ill. wow! announcer: but you can keep bacteria from ruining your day with 4 simple steps: clean, separate, cook, and chill. the roadchip to food safety starts at foodsafety.gov.
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good morning. breaking overnight, another explosive found in new jersey. the device detonating as a bomb squad robot examined a suspicious backpack found near a transit station. the latest straight ahead. and the markets now have u.s. equity futures pointing to a sharply higher open. but could the fed be a game changer later this week? we're counting down to the fomc's decision. and ceos under pressure. wells fargo's john stump and heather brash will face congressional hearings this week. we'll tell you what to expect,
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it is monday, september 19, 2016. and "squawk box" begins right now. >> live from new york where business never sleeps, this is "squawk box." good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with andrew kernan and andrew ross sorkin. security is tight in new york city after multiple explosions in the area. also a mall stabbing in minnesota over the weekend. we will have the latest in just a moment. first, though, we'll get a check on the markets. the u.s. equity futures this morning are indicated higher. the dow futures up by 90 points. the s&p futures up by 9 points. the nasdaq up by 19 after the market did make some gains for the week last week. overnight in asia, the nikkei was closed for a public holiday. this is in celebration of respect for your elders. you can see the asian markets that were open, the hang seng was up .90%. simir

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