tv Worldwide Exchange CNBC June 28, 2017 5:00am-6:01am EDT
good morning formula for a selloff? another tech tumble plus the delayed healthcare vote weighing on the markets your trading day setup straight ahead. some of the world's most influential central bankers will meet at the ecb forum sgo and sto. and stocks to watch. we'll round up the movers. it's wednesday june 28, 2017 "worldwide exchange" begins right now. good morning
welcome to "worldwide exchange" on cnbc. i'm sara eisen >> i'm mike santoli in for wilfred frost. >> and the rest of the week. happy to have you. >> until the end of the quarter. >> especially with this market move yesterday >> a lot going on. >> so let's check on global markets. after we did see a selloff s&p closed lower by 0.8%, the worst day since mid-may for stocks certainly the s&p and the dow. futures looking positive there the nasdaq still under pressure which is the concern for the overall market now those tech stocks weighing down. we have a quick early indication of the so-called f.a.n.g. stocks which have been driving the markets. facebook, amazon, netflix and google or alphabet alphabet is the only one higher in the premarket otherwise seeing some declines for amazon, netflix, facebook. the winners yesterday got
crushed. the broadcoms of the world down 3% >> a lot of semiconductor stocks alphabet was one of the f.a.n.g. that was down the most because of the negative news out of the eu in general they're going down the way they went up, which is kind of as a group a general fund employee in and out. the question has been can the broader market absorb that financials were up yesterday, but everything else was down that's why i think it's more choppy >> the other question is why are big investors liquidating those positions and does that continue will be pronounced >> is it just selling the winners. >> ten-year treasury note yield. we saw a pop in yields yesterday. substantial one. that continues this morning. back up to 2.23 on the ten-year yield. some selling of treasuries which keeps bond yields higher but still super low yields, but off from 2.13 where we started the week. asian equities did generally
follow the u.s. markets to the down side. you can see the nikkei down a half percent hang seng down a bit more than that shanghai also similar half percent. seemed like it was carrying over from the u.s. equity back off. and then the currency markets not necessarily friendly look at europe also mostly to the down side draghi's comments on the ecb and the rise in bond yields is stirring things up german dax down nearly 0.75% the ftse down about 0.25%. so you have a general rens of marksense of markets backing off. >> we're towards the end of the month and we could have funky stuff going on >> it's one of those times that investors will be reallocating and rebalancing out of -- >> yes, the healthcare vote was delayed a few weeks, but it's not like there was a lot of
excitement going into the bill and that it would pass and magically we could have tax reform >> people would also argue what und under. i will got us up 10% year to date >> as for the broader markets, oil prices reversed. they were higher by a few percentage points over the last four sessions. now headed south below $44 a barrel for wti crude we got that inventory report out last fight which showed a surprise big build the government inventory report will be released this morning. brent at 46.46, down 0.4%. the dollar, a big move higher in the euro yesterday on the draghi comments and that continues this morning. 1.1361 the dollar goes negotiate sieve against the yen by the same amount that's quind of kind of a symbo
risk reversion as for the pound, it's a bit firmer against the dollar, 1.2831 gold prices on the back of that weaker u.s. dollar weaker yesterday, weaker this morning, it's higher by a half percent. now to politics. more unsecertainty out of washington after senate republicans postponed a vote to overhaul obama care. eamon javers has some of the details. >> reporter: it was a significant legislative setback for the president and his team on capitol hill as republicans and the senate were forced to admit they don't have the votes to pass the healthcare bill. they set themselves a deadline for the end of this week to get it done. that was always ambitious, but in the end they couldn't get a number of key senators to come over the line. they only had two votes to spare. the president later in the day yesterday called all 52 republican senators to the white house for a meeting to figure out where to go next
at that meeting the president struck sort of a downbeat tone >> we have to have healthcare. it can't be obamacare which is melting down the other side is saying all sorts of things before they knew what the bill was. this will be great if we get it done if we don't get it done, it will be something that we're not going to like and that's okay. i understand that very well. but i think we have a chance to do something very, very important for the public >> the president there seeming to acknowledge the possibility of defeat here on the healthcare effort that said, they are not quitting senator mitch mcconnell said that he will take a pause here until after the fourth of july recess they'll regroup after that they'll see where the votes can be found for this measure. one thing he said as he emerged from that meeting and talked to reporters is that in the end, republicans if they can't get their act together, they might
be forced to work with democrats. >> as i said, status quo is unsustainable. it will be dealt with in one of two ways, either republicans will agree and change the status quo, or the markets will continue to collapse, and we'll have to sit down with senator schumer and my suspicion is that any negotiation with the democrats would include none of the reforms that we would like to make. >> so, mike, republicans had a number of objections to the bill there were moderates who felt it gutted medicaid too significantly. conservatives led by club for growth who felt it didn't go far enough in terms of repealing obamacare. but ultimately political objections as well one group of senators objected to a super pack called america first linked to president trump running ads against senator heller of nevada, republican in
a swing state and in a tight race for re-election the republicans didn't like other republicans beating up on a vulnerable of their caucus so a political and tactical misstep by the white house there in addition to the legislative things they have we'll see if they can pull something together that can pass the senate and then go back to the house and start there all over again >> i was going to ask you about the new timeline is that what it is they'll take the recess, regroup, then what's the probability that they can bridge together the divides in their own party or actually go to the negotiating table with democrats? >> it's really going to be tricky for them. you have senators like susan collins of maine who say no amount of tinkering is likely to get her vote it's just a fundamental problem with the bill. they can only lose two senators. that gives any other senator the wiggle room to be the negotiator
in chief here. we saw a number of senators, republicans come out after this bill was pulled yesterday and say they had objected to it as well we knew about five or six senators had objections. now that list has grown after the vote was pulled. that's probably because all of those senators also want to be in the negotiating driver's seat going into whatever it is they try to pull together then if they come up with a more moderate senate bill, will that bill be able to pass the house of representatives where members are more conservative and the conservative majority has more of a lock on things. that's a tricky negotiation as well a lot of those house members feel they want to repeal and replace obamacare. >> eamon javers, thank you for joining us on the politics of healthcare which did have a particular ket impa market impact. joining us is peter boockvar welcome. nice to see you. what is the market impact of a
delay for several weeks? >> i'm not sure. we saw this with the house bill, it initially failed and they got around to it i think that maybe they'll come to something over the next month. i think it is testing patience now we're getting to the second half of the year people are realizing maybe we do get tax reform which would then follow healthcare. we won't see the impact until 2018 it came in the context of central bank noise with draghi, stanley fischer, john williams, healthcare so the market was at a vul n vulnerable point yesterday when this hit the tape. >> there was earnings growth for the first half of the year, expectations for more, so what do you think the impact is of has we heard out of the ecb forum yesterday? >> from being behind the curtain, now they'll be more front and center we'll go into september with
maybe the quantitative tightening beginning from the fed. ecb tapering, the bank of england possibly raising rates, the bank of canada possibly raising rates, so the central bank is no longer your friend for asset prices i think people need to reassess highval dominguez valuations ins >> even though it's super slow, and we're coming off low yields and easing policy. >> there's no question it will be very slow but if there's the balloon and all the easing is the air going into that balloon, there's still air going into it. but if there's less air, the balloon starts to compress the valuations of the market which have been high for years, and valuations don't matter in the short-term, but it begins to matter people become more sensitive to
valuation when central banks are less accommodative they're still tightening, but you can call that less accommodative. i think it matters on the margin when there's little room for error at current evaluations >> even when we talk about looking for bond yields to go up as a sign that things are okay for equity markets don't we have a bit of room there? >> my fear is that interest rates on the longer end go up because of what's going to happen in the european bond market the european bond market is an epicenter of the global bond bubble yesterday the sharp selloff in european bonds on draghi hinting at a slight tapering, we saw 13 to 15 basis point increases across the board on hem talking about gradual. >> i don't know if he ment to talk about tapering. he was talking about just inflationary conditions. the upbeat environment in terms of economic data >> he has to start talking about tapering, technically his program ends in december so he has to talk about that
end. he's going to extend it by he's got to begin the conversation. >> finally is the drop in f.a.n.g. stocks that has been weighing on the market, is it related, do you think, to some of the central bank theorys that you're posing about the broader market >> potentially because people start paying attention to evaluations. they're all great companies wity got excessive and frothy, so it's time for people to reassess their exposure when central banks are tightening policy. >> especially when growth stocks were trading in a strange way as bond proxies >> yes >> the safe and steady and predictable things >> right with low volatility. >> peter, thank you. always good to talk to you peter boockvar. we're following a developing story as a global cyberattack causes massive disruption around the world. dozens of companies and
governments, mainly in europe, getting hit hard by a ransomeware attack it started yesterday, continues into today we'll follow the story and bring you more as we get it. talking a lot of global shipping companies like maersk and u.s. companies from merck to mondelez got hit very hard. unclear whether that has been fixed, whether they're paying ransom, what the hacker the want >> if it's just profit motive or looking to disrupt global trade, who knows. turning to the wall street agenda just one piece of economic data, may pending home sales out at 10:00 a.m monsanto, general mills and paychex will report results before the opening bell. kb home shares are on the move after the company reported better than expected results the home builder says second quarter revenues grew 24% to $1 billion. the company reporting earnings of 33 cents a share, 7 cents above estimates. kb home attributing the better
than expected quarter to expanding marketing operations shares of kb home have been on a tear, um mop more than 45%. adding 1% to their gains this morning. >> a great looking chart this past year, the last ten years, round trip. toshiba is suing western digital accusing the joint venture partner of sper fearing wi interfering with the planned sell of its chip unit. yesterday you see western digital up a touch a big dow chemical investor is calling for changes to the merger with dupont the "wall street journal" reports glenn view capital wants the company to scrap plans to break into three separate ups wunts t units once the merger is complete. and u.p.s. plans to freeze pensions for 70,000 nonunion
workers switching them to a 401(k) fund. more stocks to watch, american airlines is testing new screening machines for carry-on bags the machines, which have similar technologies to ct scans, can measure a bag's density and map it in 3-d. this could aoone day allow pass bbe i passengers and gels in their bags and dutch medical equipmentmaker philips announced a 1.9 billion euro takeover of spectranetics. philips is offering shareholders 38 cents and 50 cents a share. the deal is set to close in the third quarter of this year. international paper will take a pretax charge in the second quarter to settle an antitrust suit clean products sued international paper and other container boardmakers in 2010
for alleged price fixing. blue apron will price its ipo after the closing bell today. they look to raise nearly 6$600 million selling shares between $15 and $17 each that could give blue apron a market cap of $3 billion renaissance capital says 69 deals have priced so far this year, up 73% from the same time last year, with the healthcare sector being the most active >> i can't tell whether the whole foods amazon deal changes the trajectory for blue apron. >> i think it changed investor sentiment towards it, wondering how big the opportunity is >> it would be so easy for amazon to do this with whole foods. >> exactly what's your edge, except the fact you already have penetration in the market. >> and it's popular. >> it's a grand name. still ahead, we're headed to europe where a trifecta of central bankers are about to speak, draghi, carney and rokuda on deck. stick around, you're watching
no. alright, see you down there. mmm, fine. okay, what do we got? okay, watch this. do the thing we talked about. what do we say? it's going to be great. watch. remember what we were just saying? go irish! see that? yes! i'm gonna just go back to doing what i was doing. find your awesome with the xfinity x1 voice remote. . welcome back to "worldwide exchange." to europe where the ecb's annual central bank forum continues in portugal today's highlight, a discussion with mario draghi, mark carney and kuroda joining us is spepeter spiegel m the "the financial times." we were just having a conversation about whether the
markets are being jolted by a change in tone and potentially policy by the world's big effort central bankers. what are you seeing when it comes to keeping score of those policies at the ft >> we're having a similar debate here these draghi comments are being seen several different ways. markets reacted to it as a sign as they're shifting towards tightening ending qe. talked about going from a deflationary environment to a reflationary environment that triggered things. many guys on the markets team are arguing that the markets overinterpreted it he talked a lot about slack that still exists in the system yes, the economic recovery is happening but it hasn't had an effect on inflation. and that draghi said that does not indicate he's moving any time soon. i read it, i listened to excerpts of it, he does seem to be changing his tone the debate is no longer whether we need to go further in
continuing qe, it's a debate about when to end qe and when to raise rates. i think that signal was intentional. we have seen the euro rallying this morning you mentioned in your previous segment about bunds, the eurozone bond market it has become a global bond selloff, clearly if the ecb moves that direction, we have seen signs the fed is moving that direction they're all dealing with this problem, do we raise rates at the sign of economic growth. japan is suffering that, suffering that in britain and in the u.s. that's the question everybody is facing >> peter, there's another way t banks are dealingwith the similar issue, but we don't have the storyline of the fed going in one direction and the ecb is pulling the other way. >> that's right.
i think that's why the markets moved the way they did the last ecb meeting, it was clear draghi was trying to show his independence from the germans. germany has been complaining about this for two, three years. they hate negative rates draghi wanted to show pressure from germany he lives in frankfurt, so we're seeing a break from the last messages at the previous ecb meetings he's shown he's independent but like the fed and to a certain extent like the boe, that they're preparing to move towards tightening that's what the market is picking up on. >> i have a tough question it's a judgment call question. i think all of these central bankers now, one of their challenges is navigating through the political environment of their own respective countries we saw that with the janet yellen speech yesterday who is the most attempt at dealing with the politics of all of them?
carney has brexit, kuroda, who has nailed this? >> i think it's mario draghi if you look at the way draghi has been able to weave through the german political system, he's done an expert job. let's also say he has backup the french and italians are supporting him in the direction he's going if you look at yellen, clearly trump signaled he put gary cohn in charge of finding a replacement. the extent the brexiters have it out for mark carney, the chief economist of the bank of england gand h against his governor, so mario draghi is the one who faced down his opponents and stands supreme. >> and may have the toughest job of all because he has to please politicians in multiple countries. thank you.
>> my pleasure >> a lot to talk about in the central banking world. when we come back, we're live in washington with more on the senate's delayed healthcare vote and a deeper dive into the performance of the healthcare stocks and a top market strategist weighs in on what the uncertaintabt shgty ouwainon means for your money "worldwide exchange" will be right back (upbeat dance music) (dance music abruptly stopping) (dance music starting then stopping)
are looking up the nasdaq still under pressure. futures do 2wn3. up next, a round up of the top stories. "worldwide exchange" will be right back then add a hotel, or car, or activity in one place and save, where would you go? ♪ expedia gives you the world in your hand, so you can see more of it. ♪ expedia.
gains continue into the second half of 2017 and a massive cyberattack just got real. it's wednesday, june 28, 2017, you're watching "worldwide exchange" on cnbc. good morning welcome back to "squawk bored exchange" on cnbc. let's show you the global market picture u.s. stocks got hurt yesterday worst day for the s&p and the dow since may 17th s&p closed lower by almost a full percent it was the nasdaq and tech stocks that dragged down the entire market. today we're seeing that kind of pressure continue where the nasdaq futures are down 18 a bit of an improvement from the last ten minutes dow futures are up 43. s&p futures are up four. a lot of other factors going on including the dollar's worst day
since back in march thanks to drag ehi draghi's upbeat mood. senate republicans are postponing a vote to overhaul obamacare until after the july 4th recess tracie potts has more. >> reporter: we saw it happen with the house and now the senate where they planned a quick vote but realized at the last minute they did not have the support. so the senate scrapped that vote for now. they will not do it before the july 4th prak. they'll continue to try to work some of their own members, republicans n support of this at least nine said they would not vote for it. the party could only afford two. that's the politics of it. what happens next? we know the president brought in republicans to try to come up with a new game plan we're told they're trying to make revisions they can submit to the congressional budget office before they leave so they
can get that score or that budget analysis done as soon as they get back and try to continue to work on this again the bottom line for democrats is that it's delayed. it didn't happen they see this as an opportunity to put the pressure on we saw demonstrations here on capitol hill, could be tough for some of these republicans now going back to their districts where constituents will be talking to them about what they think is important what they want to happen, what they don't want to happen we've seen it before with the angry town hall meetings, some lawmakers avoiding having those meetings at all. they now face that intense pressure before coming back here to do it again in a couple weeks. >> similar to the house vote, you have opposition on both ends, what does that mean in terms of what can get tweaked in the bill in terms of content that will make everybody happy >> that's what makes this
tricky conservatives say they don't want obamacare light they want major changes in how we do healthcare moderates are concerned that one of those major changes are medicaid cuts. deep cuts in medicaid in some of their states where a lot of people rely on medicate. they don't want to see that. the challenge and the balance for leadership is to come up with middle ground that will gain moderates but not lose conservatives, or gain con zftive z conservatives and not lose moderates. turning back to the markets, we'll look at how those f.a.n.g. stocks look like they might trade today. three out of the four traditionally defined f.a.n.g. stocks down in the premarket alphabet which was down more than the rest yesterday due to
that eu fine, looks like it may be trying to bounce. these stocks were up 25%, 30% year to date everyone was talking about how the markets were too concentrated in the names, now that they're backing off, the market has to absorb that possibility. >> far it looks to you orderly, like a healthy pullback? >> looks orderly and mechanical. people had allocated to this sector of the market, now they're lightening up their weights in that sector it's not as if there's any real fundamental changes or earnings estimates being revised. it's about fund flows. where risk appetites are going >> so the question is it month-end, something prolonged, is there a change in the bond yield direction? >> month end and maybe the idea that you will get bonds up, which means cyclicals and finlts cou financials can go forward.
look at the ten-year note. the yield is still tilting to the upside now looking above 2.24, pushing to 2.25, that's the three-week high for the yield this is a global move in the treasury market. >> it's interesting that it comes with the weaker dollar >> not intuitive >> as for asian stocks overnight, let's show you the picture there. that strong yen weighed on the japanese nikkei, which closed lower by a half percent. weakness following in the u.s.'s footsteps, the shanghai comp closing lower, a half percent. south korea down 0.4%. as for europe, the early action now is indicating some weakness. the dax down 0.6%. ftse 100 resilient again, down 0.2% italy is outperforming the broader markets as well. as for other markets outside of equities and bonds, look at oil. there was a bounce attempt yesterday, wti up a bit in the
regular session. we did get a bearish api inventory report after the close. down towards $44 a share for wti crude. down a third of a percent now. natural gas is up 1% still some supply headline pressure on crude as it sits at the bottom end of the range. the u.s. dollar has been on a weakening path that's against the euro. 113.6. it has been weakening against the yen. 112 against the yen. roughly flat against the pound sterling gold has been a bit stuck, i would argue. now at 12.52 up $5 an houns today pretty much range bound. on the agenda, first on the earnings front monsanto, general mills and paychex reporting before the
opening bell and the ecb central bank forum continues in portugal. there's a panel discussion with mario draghi, bank of england governor mark carney and bank of japan governor, kuroda become in the u.s., one piece of data to watch, may pending home sales. healthcare has been a standout, up 15% year to date. will these gains hold? time for sectornomics. landon dowdy has more. >> the healthcare sector has been on a tear so far this year. second behind tech julia emanuel of ubs thinks tech will perform deeper into the summer he sees healthcare as an attractive alternative into growth we looked back at healthcare since 2010 so which stocks should you get a
nice dose of which should you avoid biotech firm regeneron and aleion have average returns of about 22%. regeneron is especially hot thanks to a positive ruling in its patent battle against amgen and the launch of a new eczema drug celgene climbing 19 prts % in te second half. the worst performers, vertex falls 9%, labcorps dips 2% >> the whole sector will watch and see what becomes of that senate bill. landon, thank you. now for some top trending stories. the "washington post" reporting that a fake "time" magazine cover bearing trump's image is hanging in five trump golf clubs. time has asked they be removed
they read donald trump's apprentice is a splash a time spokesperson says the real time cover that week featured kate winslet. cadburys has been hit by a massive cyberattack. computers at the factory stopped working last nights forring it to shut down production. it's unclear when production may resume i think there may be global capacity for chocolate production >> to make up for this never know it is broad. >> the attack is britney spears' is slamming decades of lip-sync accusations. in an interview with an israeli tv show, the pop superstar admits she uses a bit of playback, but also uses her own voice in performances. the singer says people don't give her enough credit for
on-stage efforts i might agree having seen her live a few times she dances, just does this workout routine like nobody else >> it seems like pop stars can't win because they're accused of lip-syncing or you hear recordings of their actual voice feed without auto tune people mock them for that. uber adding a feature that lets you order a ride for somebody else. the update puts uber in contact with the person who is riding rather than directing all communications to the user who ordered the car. now the uber app will prompt users by ask wlog wiing who wil riding >> people already do that. >> as somebody who has ordered an uber for a kid, it could be helpful 68. >> you would fell coel comfortae
giving them your kid's number? >> that's true >> protective dad. >> we have hot dogs on our minds. the must reads are next. and as we head out a check on futures the broad market looking like it will attempt to bounce the dow is the only one tinhe green. "worldwide exchange" will be right back prestige creams not living up to the hype?
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welcome back to "worldwide exchange." i'm mike santoli here with sara eisen. time for today's must-reads. my pick is in the "washington post" entitled "why repeal and replace will become tweak and move on. the healthcare debate will be about not whether there will be a thick fabric of government subsidies, mandates and regulations but about which party will weave the fabric. so repeal and replace will be tweak and move on. even if there are significant improvements, obama will have been proved right when he compared the aca to a starter home the point being there's no real overhaul of healthcare that's possible just a structure that grew up over the years, so let's stop talking about a true wholesale comprehensive replacement. it's just about who will get the credit or blame for specific changes to this particular bill, and who can take that into the next election.
>> i'm not sure with the delay on the healthcare vote that the lawmakers would agree with that. >> they want to call it a repeal no matter what happens, it just is what parts of the aca will they recall and call it a repeal >> my pick is in the "new york times" blind hot dog test. we taste tested ten hot dogs, here are the best. summer issue from the new york sometimes. by the way, there's some great tidbits about how hot dogs should be eaten. the bun should hug the hot dog closely, enough juice to hold everything together. condiments should compliment the hot dog and not overwhelm it the winners, apparently, only wellshire farms, only a brand sold at hold foods markets and
hebrew national had what we considered a true and familiar hot dog profile. identifiable beefy taste, a texture that's soft, a noticeable juiciness and a warm thread of warm spice flavor. that sounds delicious. >> demanding set of criteria there. where do they come down on the snap issue >> on what >> the skin snap >> the skin snap i don't know i didn't read that part. >> there's some surprises here our producer, sophia likes the trader joe's one not so popular trader joe's organic grass fed uncured beef hot dogs are funky and not in a good way. >> anything uncured is a red flag >> the flavor profile did not match up with the hot dog. they go through all of them. a lot of the popular ones. there are pictures the brooklyn hot dog company one is extra long and doesn't fit
into the bun it's worth a read. >> get yourself ready for the nathan's hot dog -- >> i prefer hamburgers >> nathan's is on here didn't score well. middle of the pack >> hebrew national is good if they're kosher, so they don't contain pork, the times gives you a whole dictionary as well about skinless -- is that what you're talking about natural casing >> it's about the whole firmness and snap some people hate it. some people like it. >> you speak like someone who makes hot dogs >> yeah. i'll be at the grill at some point. from hot dogs to homes, kb home reporting second quarter results after the close. >> i don't know how i follow that one i don't discriminate on hot dogs or hamburgers. let's look at the stock. shares of kb home moving higher in the premarket after better than expected results. second quarter revenues grew 24% to $1 billion the company also reporting
earnings of 33 cents a share that's 7 cents above estimates kb home attributing the better than expected quarter to better operating margins. q2 deliveries rose 7%. jeffrey mezger says the housing market recovery continues on a steady path and recent improvements in consumer sentiment and employment and mortgage rates are signalin signaling further strength in demand >> landon, thank you. 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 did you participate in the top hot dogs we're loving it. >> i did not i was in aspen what am i supposed to say? what am i supposed to say? but it does look yummy
we have a big show i don't want to overstate things this one of those days where we really do have a meaningfully big show let me tell you what's coming up we have toby cosgrove who will talk to us about this healthcare bill and get some reaction to what is happening or what is in this case not happening. then we have scott gottlieb who will join us the new fda commissioner, in his first interview since getting confirmed. we'll talk m&a bigley with robert kimler head of m&a at morgan stanley then we have harold hamm, and if you're ready for this, last but not least, condoleezza rice will join us in the 8:00 hour there you have it. i hope i have not overstated the situation. >> you have not disappointed sounds like a terrific lineup. >> see you in a bit. still ahead, one market strategist, 27 billion under management says time to
welcome back to "worldwide exchange." futures gaining some steam here. dow futures up 57, nasdaq down about 7 points joining us is scott clemens. do you see the selloff as related to the delay in the healthcare vote? if so, what do you do about that >> we're sort of in a quiet period for fundamental news. the second quarter earnings season has not started yet the summer volumes tend to be light. the market is prone to overreact to whatever happens. i think that was part of it yesterday. that calls into question the timing and pace of the rest of the white house and republican a agend agenda
markets up 8%. nasdaq up about 14%. a little profit taking not out of the question. >> up 8% in the broad market, 10% with dividends does that moean we front load a lot of gains >> i think it's justified by the rebound in corporate earnings. that's the real news in july we get more and more evidence as to whether or not that earnings rebound continues. my extechtat expectation is tha. that news flow continues to be resilient. all the news, fundamental increase in earnings drives the market >> you mentioned a quiet period for fundamental drivers of the market as you look out what are some dates, events or issues that could throw the market off a fundamental standpoint i eluded to the july earnings
reports. >> people expect that to be good enough >> i think we'll see a year over year increase of 20% which is remarkable this late in an economic cycle, this late in a market cycle the next big thing on the agenda politically will take place in september or october when we debate a budget, debt ceiling. you will remember how that went three, four years ago. it consumed all the oxygen in washington which calls into question further the ability to get through the fundamental parts of the president's agenda. to me, that's the next big potential risk to prices and volatility >> it seems the market is laser focused when it comes to looking at policy as whether there will be something that underpins corporate 2018 earnings. maybe you like tax reform, longer-term growth, but absent that, if we don't have verification of 2018 numbers, where does that leave us >> that's a good question.
that's the important question. the calendar effects of year over year earnings growth will dissipate. so the comparisons won't be quite as seizely what is gratifying about the rebound in earnings t hasn't been driven by margin expansion but real live margin growth at the top line somehow companies are finding ways to grow unit vol you'umes d increase prices. >> we'll see if it continues in the second quarter scott clemons, thanks for joining us what will you be watching today? >> the bond yields i want to see if this has lift to it in terms of this move. >> big move from 2.13 to 2.24. >> pushing 2.25 on the ten-year. that will animate with sectors in the stock market. >> certainly financials have been -- >> the one sector up yesterday >> on the back of those bond yields i'll be watching general mills earnings coming out. that's been a tough business, package food
sales growth hard to come by that's it for "worldwide exchange." thanks >> i'll see you tomorrow >> "squawk box" is nt.ex [vo] when it comes to investing, looking from a fresh perspective can make all the difference. it can provide what we call an unlock: a realization that often reveals a better path forward. at wells fargo, it's our expertise in finding this kind of insight that has lead us to become one of the largest investment and wealth management firms in the country. discover how we can help find your unlock.
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live from new york where business never sleeps, this is "squawk box. >> good morning, everybody welcome to "squawk box" on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with andrew ross sorkin and michelle caruso-cabrera let's look at the u.s. equity futures. right now things are mixed dow futures are up significantly, up by 52 points s&p futures up by 6. the nasdaq is down by 9. this comes a day after the nasdaq had a steep drop off. down by 1.6 pfrs yesterday the dow was off by a half percent. the s&p by 0.8%. we'll see how things shape up as we get closer to the opening bell overnight in asia, the nikkei ended down by almost half a percent. the hang seng off by 0.6%. the shanghai down by a half percentage point in europe, you will see some red arrows you will see that righ