tv Worldwide Exchange CNBC November 11, 2016 5:00am-6:01am EST
good morning. the trump rally, the dow cli climbing to an all-time high. >> and it's singles day in china. a live report coming up. >> and disney's results falling short, but ceo bob iger still feels bullish. it's november 11, 2016, veterans day. "worldwide exchange" begins right now. good morning. welcome to "worldwide exchange" on cnbc.
i'm sara eisen alongside dom chu who is in for wilfred frost. >> happy veterans day. thanks to all who have served and all who are serving in the military right now. >> i echo that as well. >> let's get to the markets. after quite a rally for the dow, finishing at a record high. the s&p not there, and the nasdaq has been the underperformer all week long. it's only up about 3% so far this week versus the dow's gain of 5%. right now the dow futures are up 21. s&p features down 2.5. nasdaq futures down more, 43. so this rotation out of tech continues. the bond markets are closed today in honor of veterans day. let's show you where the ten-year note yield finished yesterday. just to give you a sense of the story of the week, which is yields shooting higher. look at the end of that chart, jumping to 2.1. big selloff in u.s. government
debt has been a key theme in the wake of the trump surprise victory. what was that druckenmiller quote from yesterday? rates could be like a beach ball submerged underwater? they could shoot up quickly in a short amount of time. >> that's something we'll talk about in a moment. let's look at stocks in europe. we are seeing at least a little bit of -- we saw a little bit of strength, now mixed. the dax in germany only up by a quarter of 1%. the cac in france down by a half percent. the ftse 100 in the uk down by about 1%. the ftse mib in italy up by a half percent. the spain ibex down about three quarters of a percent. as far as asia, also a bit of a mixed picture. the nikkei in japan after a massive move on thursday up by 0.2%. hang seng and hong kong off by a third. the shanghai up by three
quarters of a percent. >> read on business sentiment on japan, japanese manufacturers confidence rose to a 15-month high in november. that's an encouraging sign for the japanese economy. let's check on the overall markets here. oil prices, which did participate a bit in the rally, are a bit soft this morning. down 0.8%. under $45 a barrel. they've been in a narrow range. brent is down less than a half percent. gasoline is higher. the dollar has been strong. dollar/yen has followed treasury yields higher. this is a currency pair at one point was down to 1.01. >> we were talking about 100. >> when the futures and dow were down more than 800 points. what a turnaround. at a 3 1/2 month high on dollar versus the weaker yen.
as for the euro/dollar, 1.0855, that reflects a stronger dollar. the pound strong, marching to its own beat, 1.2658. gold having a weak week despite uncertainty and surprise. it is down another percent. add it all up, dom, who observations. number one, the tide has turned in terms of sentiment so sharply, bullish around the u.s. economy, bullish on growth policies that we could see from trump and republicans in congress like infrastructure and defense spending, tax cuts. >> absolutely. >> that's causing the jump of yields and in certain sectors like financials. >> materials. >> we will talk more about this, but the infrastructure play. copper is up on a winning streak like i haven't seen in ages. >> we have a weekly chart of copper. the best week for copper since the early '80s. >> between that and you talk
about the strongest moves in material stocks like martin marietta materials, they make construction aggregates, think asphalt, concrete. >> billiuilding stuff. >> yes. >> that's one observation, the sentiment has changed and enthusiasm. the other is how quickly it's happened and how quickly these moves are happening. another 6.5% rise in copper. it's something cramer warned about at the top of his show. yes, it's good to have this sort of renewed spirit. this was a market looking for a catalyst, but it makes people skeptical when it happens so far so fast. >> jim has been talking about the construction side of things. we'll hit on that throughout the course of the show. the dow hit a record high yesterday, at least at the close. investors adjusted positions
after an election that trump won. pershing square's capital's bill ackman says he believes trump will steer the country in the right direction. >> i woke up extremely bullish on trump, believe it or not. my thinking is as follows, united states is the greatest business in the world. it's been undermanaged for a long period of time. we now have a businessman in the president's -- as the president, and he has power. because republicans control congress, republicans control the senate, he's going to launch a major infrastructure program. he will take corporate taxes down to a sensible level and get rid of loopholes. he's going to get a lot done. >> in election primary season, bill ackman tried to draft
michael bloomberg to enter the race for the white house. he explained his original concerns about donald trump and talked about the volatility that he thought might have been there. but he's been reassured because he believes trump will want to be the greatest president this country has ever had. >> it's not just bill ackman. i'm thinking back to delivering alpha in september. >> yes. >> the thread from there was how the big money, the major hedge fund managers that we all heard of are gloomy and doomy. they're worried about monetary poli policy reachinglimits, no fiscal action. boy, have they changed their tune. you just heard from ackman, remember stan druckenmiller, i think we have some sound. listen to how he changed his tune. he was speaking on "squawk box" yesterda yesterday. >> this economy is so overregulated, people are drowning in red tape that the
removal of that and then i'm expecting serious tax reform, cuts to the corporate tax rate, a blended rate of under 10% to repatriate capital. i'm quite, quite optimistic on the economy. as always open-minded, but optimistic. i basically have a large bet on economic growth. how do i do that? i'm short bonds globally. i'm short bubbles. short bunds, short italian bonds, short u.s. bonds, that's reflective of not a disaster with deficits but stronger growth. i like sectors of the equity market that respond to growth, value and materials. staples and traditional growth stocks, and i really like the dollar, particularly against the euro. >> what he likes is working, the dollar, bonds are selling off
around the world this week. you're seeing rate sensitive areas like staples, utilities, telecom getting hammered on the back of rising rates. at some point when we get above 2% on the ten-year, you look at the bond yields, dividend yields, they're coming closer together. >> we're just about at that intersection where the yield on the overall s&p 500 is just about the same level address yields on the ten-year treasury. we talked about that inversion, about the reasons why people like those dividend paying stocks because you could get an incremental amount of income versus the ten-year treasury. >> for once, nothing to do with the fed. >> we will talk about fundamental stories again, sara. the trading week actually wraps up today with just one economic report on the agenda. it's 8:30 a.m. eastern time, it's the federal reserve vice chairman stanley fischer speaking on the economy. on the data front, the read on
consumer sentiment will be out at 10:00 a.m. as well. you have earnings, jcpenney reports third quarter results before the opening bell today. it's been a big week for retail and consumer discretionary related stocks. that, you can say, is helping to drive some of the market action. >> there's some enthusiasm there, too about the holiday period. >> disney earnings and revenues fell short of estimates, among the reasons, lower advertising sales and espn subscriber losses. the stock initiallify fualling that news but recovered as ceo bob iger sounded upbeat on the future. >> our outlook on espn is positive. you have a category, live television sports, that's generally very healthy. it adapts very well to mobile platforms. that's where we're moving espn. we feel good about espn. we're dealing with near-term
issues on the sub side, eyes wide open on that. not trying to hide anything. we think long-term prospects for espn are fine. >> more specifically, iger predicts modest growth in disney's next fiscal year but then says to expect more robust growth ahead of that. he expects digital revenues to be the big driver. >> in other corporate news, shari redstone said she never wanted to separate viacom and cbs ten years ago. redstone and her father, sumner, control both companies through their privately held movie company. a decade ago, summer decided to split viacom and cbs, but earlier this fall the redstones urged the companies to explore a merger. >> i think it makes sense at this point in time to explore whether it's in the interest of both companies to merge again. when you look at the changes taking place in the industry, you talked about some of them today, scale is going to matter.
it's going matter to the consumer who is looking to choose among a broader away of content what do they want? the more content you can offer, the more choices, the happier they will be. >> redstone added while she supports the merger both companies can stand on their own an be great. nordstrom sales topping estimates helped by its anniversary sale. gross margins rising more than expected. michael kors offering downbeat holiday guidance citing a decline in mall traffic. in its most recent quarter, kors beat on the bottom line, revenue came within estimates. nvidia reporting a 53% surge in revenue because of strong demand for the firm's chips. the firm announcing a $2 billion buy back and a hike of its dividend by 22%. >> 12% premarket gain. >> that's a big one. when we come back, it's been called the world's biggest
shopping event. it's singles day. alibaba looks to be closing in on a new sales record. we will take you live to china for a report. stay tuned. you're watching "worldwide exchange" on cnbc. so i thought t might be time to talk about a financial strategy. you mean pay him back? so let's start talking about your long term goals. knowing your future is about more than just you. it's how edward jones makes sense of investing.
even more so because of the trump election win. we've scene the markets rally strongly on those results. equity futures down about 0.2%. s&p futures off by 0.42%. and the nasdaq off by about a percent. oil is a big part of the story but not talked quite as much in the scheme of the overall stock market. brent crude futures off by 23 cents here. wti crude off by a full percent, $44.23. it's singles day in china, one of the largest online shopping days in the world. the alibaba-led event is estimated to generate $20 billion in sales. sherri kang joins us from outside alibaba headquarters in shenzhen. this is a massive day for
alibaba. how much are we talking about this time around? >> dominic, we are talking about 14.5 billion u.s. dollars, we are counting. we have six more hours to go until singles day. >> well, we've lost the shot from shenzhen, as you can see there. we'll get back to chery as we can. back to the broader markets. investors are piling into the dollar. it is strengthening against trading partners like the yuan, the mexican peso and bigger developed currencies like the euro and japanese yen. good morning, derrick. >> good morning. >> why is the dollar strengthening so much. we get the mexican peso and some of the rhetoric from donald trump, but against other big currencies, too. >> i think, you know, first off,
the markets have taken a view in terms of the directions of trump policy and perhaps the early days of his administration. there's two clear avenues, one is the fiscal stimulus and domestic spending, the other is the more divisive and less growth positive avenue of trade protection, policies to tackle immigration. i think for now the markets have gone down the first avenue and are focusing on the domestic demand boost to the economy from the tax policies. that really is the story in terms of yields and of course in terms of the dollar. >> it's dominic here. one thing we've been observing in the stock market in the u.s. is the massive run up for bank stocks because of all of this optimism about a steepening yield curve, whether that will
be better for them or not. is there a sense right now that interest rates can continue on this upward trajectory or are we due for a pullback soon? >> i'm a bit dubious. i get the longer term picture, but i do think that we have entered into a profound period of uncertainty. just look at dollar asia today for example and dollar emfx, we are beginning to see the first signs of what happens when you have these sharp moves higher in u.s. rates. the first casualties are the carry trade. that can start to create pretty intense financial market volatility and instability. that could quickly spread to equity markets. before you know it you could see reversal in the positive sentiment we've had. with that, of course, the yield momentum in the united states
could reverse as well. >> so the economist has a great piece that looked back to john connelly, treasury secretary's statement, the dollar is our currency but your problem. that's sort of what's playing out in the currency markets on the trump presidency. good for america, but what does it mean for emerging markets and the rest of world growth. is that the new paradigm in the currency markets? if so, what does it mean for some other currencies? >> again, it's about balancing up the positives and the negatives. of course, the u.s. economy is the largest economy in the world. if there was a big boost to domestic demand growth, some of this appreciation of the u.s. dollar versus these other currencies would not be that harmful potentially. the domestic demand global story would certainly pick up. what i would focus on somewhat
is what the fed do in response to this shifting expectations. if you go back to october, we had yellen talking about hinting at allowing the economy to run hot, signaling they would allow an inflation overshoot. yellen is speaking next thursday. is she going to repeat those hints? of course the balance of risks have shifted. if the markets start to get a sense that the fed won't respond to rising inflation expectations, the sentiment could again turn negative. >> are you saying they may not raise rates in december? >> yeah, bringing it shorter term, i would not be as confident as prior to the election we thought they would move in december on a clinton victory. the profound period of uncertainty and the assumption that the markets will remain orderly through to the 14th of december is a big call. i'm not confident that will be
the case. >> skepticism there, derek. thank you for joining us. have a great weekend. derek halpenny. >> so many things play into the currency market. anti-trump protesters hit the streets for a second day. those details coming up next. here's today's national weather forecast from reynolds wolf. >> good morning. let's look at the forecast across the country. we'll have cooler times in chicago, 49 degrees the expected high. dry weather for new york, 59 degrees there. atlanta, partly cloudy, a lot of smoke from those fires across tennessee, north carolina, alabama. dallas, clear skies, 74. denver, beautiful day. seattle, 61 and a bit of cloud cover. the l.a. basin, slightly cooler day. yesterday temperatures in the 90s, today about 86. dry across the great basin.
lovely in bismarck with 53 degrees. into the weekend, expect more of the same. miami looks spectacular, 82 degrees and plenty of sunshine. hold tight, more coming up on "worldwide exchange." what i love most about tempur-pedic mattresses... is that they contour to your body. you just have to lay back in my tempur-pedic, and it just kind of forms to my body. it comes up to you, like hey, there you are... hey, there you are... ...i'm going to put you to sleep now. it keeps us comfortable and asleep at night. can i take a nap now. it's our biggest event of the year ...and a great time to buy a tempur-pedic,
criminal and dangerous behavior. several thousand demonstrators gathered in the city center with some smashing windows and throwing firecrackers. late last night trump sent out a tweet saying just had a very open and successful presidential election. now professional protesters, incited by the media, are protesting. very unfair. still, sara, a tense situation in certain parts of the united states. it's been an emotional election. >> and divided. >> very divided election. president obama will honor our nation's veterans today. the president will pay tribute by laying a floral wreath at the tomb of the unknowns. an annual observance at arlington national cemetery. it's the last veterans day ceremony of president obama's term in office. haul of the papers lead with
that hand shake between president-elect trump and president obama. everyone was cordial. everyone was very presidential. even though everyone said it was very awkward. thursday night football, the baltimore ravens beating the winless cleveland browns, 28-7. the ravens hold sole possession of first place in the afc north. when we come back, the top stories including a round up of global markets. stay tuned, your watching "worldwide exchange." ♪ is it a force of nature? or a sales event? the season of audi sales event is here. audi will cover your first month's lease payment on select models during the season of audi sales event. (bing)
our customer is a our 21-year-old female. heavily into basketball. wait. data just changed... now she's into disc sports. ah, no she's not. since when? since now. she's into tai chi. she found disc sports too stressful. hold on. let me ask you this... what's she gonna like six months from now? who do we have on aerial karate? steve. steve. steve. and alexis. uh, no. just steve. just steve. just steve. live business, powered by sap. when you run live, you run simple.
good morning. ready to run. the dow climbing to an all-time high following donald trump's election victory. we'll tell you why some well known investors are sounding upbeat. and new this morning, a snapshot of the american consumer. retailer jcpenney tops today's earnings central. three things you'll want to watch in that report. and video going viral. a steph curry fan taking dancing to a whole new level. it is friday november 11, veterans day. you're watching "worldwide exchange" on cnbc. ♪ >> good morning. welcome back to "worldwide exchange" on cnbc. i'm sara eisen alongside dom chu who is in for wilfred frost. >> good to be here. >> it is a week in which donald
trump surprised many pundits, the media, pollsters. >> just about everybody. >> by winning this election. it's also a week where the dow is on track for its best week in five years, which could come as a big surprise knowing that election result. s&p also on track for its best week in several years. two years for the s&p. the nasdaq left out of the party. it's still up about 3%. tech in the last 24, 48 hours has underperformed. you're seeing that again this morning. nasdaq futures down 47, a much bigger drop than dow futures which are down 6 points, and s&p 500 down 5 points. early action in europe, some bullish momentum there slowing down as well. there's been a strong rally over the last few days. the dax is flat in germany. france is down about 0.6%. ftse 100 is down more than 1%. that's the underperformer. spain as well down as well. as for asia, overnight, how it
settled, the nikkei in japan is doing better thanks to the weaker yen. dollar/yen goes up to a three-month high. strong dollar, weak yen. that finished higher about 0.2%. hong kong underperformed by 1.3%. the shanghai composite up about 0.8 0.8%. >> if you look at oil prices right now, we're seeing weakness there. wti crude 44.11. off by over a percent now. ice brent crude futures off by 38 cents. $45.46 the last trade there. if you look at the ten-year note yield, it is a fixed income bond holiday in the u.s. because of veterans day. but those yields, 2.13, almost 2.14%. the right side of the chart tells you everything. the risk has been kind of put back on in the markets. the safety of treasuries has
gone away. you see people selling treasury bonds and pushing yields up. as for the dollar, currency markets front and center. you have euros, 1.0871. dollar/yen, 1.0616. a bit of dollar weakness there. the pound, 1.2659. showing some strength there. dollar weakne gold prices have moved off of their highs over the last couple of months. we are lower again by almost a percent. 1.255. copper is one of the hottest trades over the past week or two. >> the chart of the week. >> up another 5.5% so far today. this winning streak has been huge. a lot of this tied to optimism about infrastructure spending, about this idea we'll have
economic growth not just in the united states but around the world. copper again, just a massive winning streak. >> up more than 15% for the week. on track for its best weekly performance in 35 years. we talked to mark faber of the boom, doom and gloom report. he said this is bullish for commodities because of this infrastructure play out of the u.s. the dow setting an all-time high yesterday as investors adjust positions and opinions following the election win by donald trump. we heard from lloyd blankfein last night with our own andrew ross sorkin. >> his policies are market supportive. i'm not saying it's good or bad -- you have to draw a different set of conclusions depending on your attitude about everything else, just as far as asset prices are concerned, how could you not be supportive? >> the supportive nature of trump's policies coupled with
the republican congress. we heard from some big hedge fund names, smart money completely changing their tune when it comes to the market and economy. we did hear from carl icahn, who is a trump supporter and said he was buying the night of the election. listen to what he said earlier in the week. >> what you have to do is incentivize business. doesn't even have to be a tax change, just incentivize. let the average ceo know government is behind you. government is pushing you. this is where we have to go. we have to get that done. i think trump is an extremely bright guy. i think he's going to get this done. >> there's one take, which also echoes what we heard from bla blankfein. and then here is stan druckenmiller speaking on "squawk box" yesterday.
>> this economy is so overregulated, people are just drowning in red tape, the removal of that, and then i'm expecting serious tax reform, cuts to the corporate tax rate, a blended rate of under 10% to repatriate capital. i'm quite, quite optimistic on the economy. as always open-minded, but optimistic. >> there's no doubt that optimism played out over the past four days. >> is it so far so fast, that initial enthusiasm, or are these policies that finally might happen, infrastructure spending, repatriation of $2 trillion in cash from overseas to overnight it won't happen overnight. are they enough to give this economy a shot in the arm for the longer term? >> transportation stocks are at a 52-week high right now. there's a general sense of optimism.
>> but it's not for everyone. technology has been a big lagging -- >> facebook, amazon, netflix, apple, all still weak compared to the overall market and down the past couple of days. >> is it the rotation out of them because they've been winners on earnings growth into other stocks that have been beaten down like industrials which are getting life. >> but then there's nvidia which is up 15% pre-market. and amazon is exclusive. >> bezos tweeted yesterday he will have an open mind and wishes donald trump a lot of luck, which i think a lot of his rivals including president obama and hillary clinton have said. that gives people hope. the trading week here wraps up with one economic report on the agenda. at 8:30 a.m., stanley fischer will speak on the economy. on the data front, the first read on consumer sentiment is
out at 10:00 a.m. retail earnings, jcpenney reports third quarter results before the opening bell. this is a big one to watch in a slew of retail earnings this week. >> landon dowdy has lee thing toss watch from jcp. >> the street is looking for jcpenney to report an earnings loss of 21 cents a share. here are three thing toss watch. sales, jcp has missed analyst sales estimates in the first two quarters of the fiscal year. sales fell in the first quarter but slightly recovered in q2 despite an uncertain retail environment. analysts expect sales to rise 2.3% in this report thanks to management's strategic initiative. second is sephora. the beauty shops within jcpenney stores are helping to increase foot traffic. and jcp plans to add 60 new
sephora locations this year. and the revival of brands like liz claiborne and st. john's bay. you want to listen for more details on that. if its enhanced digital presence is boosting sales. look at the stock. shares are down more than 11% in the past three months. back over to you. >> thanks. sara, the options market pricing in a 9% move for jcpenney. >> in either direction. >> disney earnings and revenues fell short of analyst estimates, among the reasons, lower advertising sales and espn subscriber losses. the stock initially falling on the news but recovered as ceo bob iger sounded upbeat about the future. >> our outlook for espn is positive.
you're looking at a category, live television sports which is very healthy. it adapts very well to mobile platforms. that's where we're moving espn. we feel good about espn. we're dealing with near-term issues on the sub side, eyes wide open on that. not trying to hide anything. we think long-term prospects for espn are fine. >> overall iger predicts modest growth in disney's next fiscal year but then says to expect more robust growth ahead of that. he expects digital revenues to be the big driver of that growth. >> you wonder if that weaker growth in this quarter and next year has been priced in the market. it's one of the worst performers on the dow this year. to today's top trending stories, sad news from the music world. leonard cohen has died. fans taking to social media to celebrate the very influential singer and songwriter's life. he was 82 years old. he was known for his hits including "hallelujah" and "dance me to the end of love."
the exact cause of his death has not been announced. i think this one is my father's favorite. all-time favorite. i grew up in a house of music. leonard cohen was always on. >> many of our boomer generation had a lot of his music on. we have a video going viral this morning. you never know what you're going to see when you enter oracle arena sometimes it's steph curry breaking three-point records, other times it's this. the arena's dance cam caught this golden state warriors fan showing off her best moves. she has some good ones. moves i've never seen. the crowd cheered on the dancing machine decked out in her warrior's themed christmas sweater. the video went viral in no time. i'm trying to see if i can channel that. >> that's good. >> just a little -- i don't have
we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. the market.redict but through good times and bad... ...at t. rowe price... ...we've helped our investors stay confident for over 75 years. call us or your advisor. t. rowe price. invest with confidence. what's going on here? i'm val, the orange money retirement squirrel from voya. we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? more of a spokes metaphor. get organized at voya.com.
slammed in the wake of the donald trump victory. there's the dollar stronger against all of them. the brazilian real, south african rand, the mexican peso. these equities, the stock markets are getting hit hard on this idea that the america first policies which are driving up u.s. stocks -- >> will leave them behind. >> is the indonesian rupiah. a big move in these currencies. the idea that policies will help the u.s. growth -- >> at the expense of -- >> at the expense of other countries and currencies. we'll keep an eye on those emerging market selloffs. time for the must reads, the stories catching our attention. i went overseas to the british
paper, the telegraph, nigel f faragh claiming victory, he says britain has been foolish to scorn donald trump and we must now extend the hand of friendship. for the wider world i do not subscribe to the point of view that the world is a more dangerous place with trump. i think they are all looking through the wrong end of the telescope, despite the democrat label it is hillary clinton who has been the neocon supporting and encouraging military intervention in the middle east at every given opportunity. he's trying to counter some of the sentiment that we are seeing across front pages and hearing from friends overseas, the worry of donald trump disrupting the so-called liberal order of globalization, and respected worldwide institutions as he has gone after a lot of it on the campaign trail. >> my pick is from a celebrity.
jennifer lawrence following the election wrote a piece saying don't be afraid, be loud. she writes if you're worried about the health of our planet, find out everything you can about how to protect it if you're worried about racial violence, love your neighbor more than you ever tried to before, no matter what they believe or who they voted for. if you're afraid of a wall putting us all into another recession, organize and stand against it. echoing some of the thoughts of nigel, more of the hillary clinton side of things, more of the barack obama/donald trump side, they're saying we're all americans now. you may not like the outcome, perhaps you can protest nonviolently, i should say, but still work together to make our country a better country. >> because donald trump knows now his approval ratings matter, the markets matter. it's not just about the polls anymore. not just about the size of his rallies. >> now it's about leadership. >> and there's a burst of
positivity coming from a lot of people on the other side from him so far. we're approaching the top of the hour. the team is getting ready for "squawk box." andrew ross sorkin has a look at what's coming up. as we've been playing all of your great interviews from yesterday. >> thank you. we'll talk about a lot of those conversations, as you can imagine. what we've been describing as the trump rally, you showed some tape of bill ackman talking about the trump rally. had a similar conversation with lloyd blankfein. we'll talk to a number of guests about trump, what it means to the markets and the economy. we'll walk you through some of the disney earnings. show you some tape of bob iger, th and something from shari redstone. that's what we have on deck this morning. >> what did the ceo of pepsico
after the results of the election? she needed a tissue box? >> she needed a tissue box. to her credit and to so many people who spoke yesterday, who, as you guys were talking about, people who might have been on the other side of donald trump on this election, all of whom said they were coming out and supporting him and the country. >> they want him to be successful. coming up, more on that trump rally for the markets. we'll get thoughts on the markets from jack caffrey. he's coming up next.
the s&p 500 up 4%, the russell 2000 up by 7%. joining us now is jack caffrey, global portfolio manager from jpmorgan. are you buying on this trump rally? >> we were invested going into the rally, you're seeing a dramatic rotation within the markets. the interest rate sensitive stocks have done much better. the more growth interest rate sensitive stocks have done better. they are pointing to expectations of a better day. we're trading and emphasizing the expectations more than the delivery in the short-term. >> one thing we noticed in the days following the election, the massive move higher in the trump-specific sectors, industrials, materials sector, also talking about financials.
have those stocks run up so much too far too fast in essence? >> i don't think the financials have come too far too fast. certainly you have -- this is not necessarily an expensive group yet, if you look on a price earnings basis, it's a cheaper group. in line with its more traditional valuation. you're looking at that higher interest rate, steeper yield curve and you start thinking maybe the banks can benefit from better net interest mar jigins reduced regulatory burdens. the reality may be more interesting given the policies we were talking about being implemented in the future. trying to get solutions actually coming out of congress. >> let's go one by one. the banks are up shg, financial 11% this week. is this on the idea that some of dodd-frank might be scrapped or all of it as alan greenspan said yesterday he would like to see. clearly the steeper yield curve
is helpful for the banks, but is this one where reality could meet somehopes reflected in the sector? >> the banks have the capital in much better shape than a few years ago. the prospect of reduced regulation or -- i don't think you can reduce regulation, i think you can potentially slow change. you can continue to looking to market-based policies. the stocks are not -- what matters is, i think, ultimately loan growth in that regard it comes back to the hope or expectations of a stimulus bill, a stimulus bill soon leading to a virtuous momentum driving cni loans out of the banking sector. in this regard, you saw some tightening that came out on monday. i've been buying banks over the past several weeks. am feeling happier about that decision over the last couple of days.
it's easier to look at that list in my portfolios. if you're long, you're very happy now. let's say hypothetically, unlike yourselves, there are people on the sidelines not long or underweight going into this market. how would you suggest investors get into the market now? dump everything into stocks or is there a strategy you would follow to get back into the market? >> the smart way is always to think about how you want to time entries into the market. it's not necessarily a one and done exposure. if you're looking at what's going on, you look at the amount you've seen in terms of the advance on the week, it's trying to buy those pullbacks. today could be an interesting opportunity for somebody who says i can't buy something up that much that quickly. >> you need a pause. >> you have to be a believer in things getting better. that's where the prospect of a unifiy eied white house coming together with a unified branches
of congress points to people getting things done. >> what do you do with the technology earnings growers and fast revenue growers, facebook, alphabet and amazon which have been hit hard this week? >> a lot of investors are using those stocks as funding to get into the banks, getting more exposure to the materials sector. if they have growth mandates, probably are buyers of biotechnology and healthcare which have been a weak sector over the -- >> do you scoop in and buy on this tip on the tech stocks? >> i don't think you scoop into them. higher interest rates are making those future interest rate growths less valuable than two, three weeks ago. you are paying a full multiple for the expectations of low growth continuing forever. now people are starting to question that. >> jack, thank you. jack caffrey, jpmorgan private
. good morning. the trump rally rolls on. the dow climbing to another all-time high nearing 19,000. just as the experts predicted. it's singles day in china. that means billions of dollars in sales from retailers like alibaba. a live report from shenzhen straight ahead. and disney's quarterly results fall short of wall street estimates, but ceo bob iger is still feeling bullish. we will tell you why. it is veterans day, thank you. thank you to all the vets. friday, november 11, 2016.
"squawk box" begins right now. ♪ live from new york where business never sleeps, this is "squawk box." good morning. welcome to "squawk box" on cnbc. i'm andrew ross sorkin with joe kernen, michelle caruso-cabrera is with us. bond markets are closed today in honor of veterans day. look at u.s. equities this hour after a rip roaring couple of days in the markets. we called it the trump rally. dow looks like it might open 20 points down. nasdaq off 45 points, the s&p 500 down about 8 points. in asia right now, bit of a mixed picture. nikkei up. hang seng is marginally down. over in europe, things have been down again after what was an u