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tv   Worldwide Exchange  CNBC  June 29, 2017 5:00am-6:01am EDT

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good morning a big bounce back. stocks rally as the s&p 500 scores its biggest one-day gain in two months. your trading day set up straight ahead. and in the clear for the first time ever, america's big banks pass the fed's stress tests and they are celebrating by sharing the love with stockholde stockholders. and blue apron does some serious chopping ahead of today's ipo. it's thursday, june 2920, 2017, 1/4 white sox 2017, "worldwide exchange" begins right now. ♪
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good morning welcome to "worldwide exchange" on cnbc. i'm sara eisen >> i'm dominic chu in for wilfred frost. it's throwback thursday, here's a one-hit wonder, "i'm blue. >> you wremember this. >> who could forget. it was all over new york >> all over cincinnati, too. glad to have you here. >> good to be here >> let's check in on the global markets after broad-based rally yesterday for u.s. equities comeback futures set for a higher start dow jones up 33. financials were a big driver after the stress test results. nasdaq up 1 point. s&p up 4 the banks led the session yesterday. they came out with much bigger than expected cash returners in the forms of buybacks and dividends. the fed blessed all of it financials got a further boost
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after the close. there's the early action in terms of the xlf, the etf that tracks financials, up 1.5 in the early action what's helping the banks is the ten-year treasury note yield has been bouncing. certainly off the lows of 2.13 we saw this week 2.24 not bad. some selling of treasuries for the last few sessions sending yields higher. >> if you get those yields higher and the stress tests, probably -- >> a good recipe for the banks asian equities now around the world. we'll talk about the closed market asian markets broadly higher hang seng up by 1% the kospi up bay half pey a halt in europe, financials being buoybuoy ed over there by some results of the stress tests here. the dax fractionally higher. the ftse 100 up a half percent all the other markets
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fractionally lower the broader market picture, let's show you oil prices which are firmer wti is back above $45 a barrel nice comeback for oil after reaching a bear market last week it's up 1% this morning. real strength in oil prices after inventories yesterday. brent, 47.72, m land the u.s. dollar, traders didn't believe mario draghi or at least the attempt to walk back the hawkish statement earlier in the week. and the euro soaring, up 114.21. >> it's pretty amazing a half percent it's may of last year, that's the last time we saw this. >> strong euro, and this idea that central bankers, which happen to be speaking this week, some gathered in portugal, yellen in london, everyone talking about getting out of
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this super easy monetary policy. even if mario draghi is not explicitly talking about t he's talking about a more inflationary, deflationary world, that's a signal that we're coming out of it >> deflation not as big of a concern. but with oil prices trying to find footing -- >> not like there's signs of inflation everywhere >> the your ro euro is a big mo. gold is down 2 bucks the fed clearing capital plans for 34 of america's biggest banks. the move prompting mthem immediately to announce dividend increases and buybacks citi group doubling its quarterly dividend to 32 cents a share. jpmorgan at 19$19.4 billion. morgan stanley raising its dividend by 25%. joining us on the cnbc news line is long-time bank analyst gerard
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cassidy, rbc capital markets good morning is this a sign of strength overall in the banking sector? are these banks being aggressive when it comes to returning cash? >> not at all. this is a good sign of the strength of the system after the stress tests of last week, the banking system, the c-car banks that go through the stress tests, they had over 4$40 billion of capital above the minimum levels even with this disbursement today, we are still well capitalized. and investors should expect another big number in 2018 as well this is not a one-time item. this will continue for a number of years >> gerard, you are a guy that knows distressed banks very well you developed the texas ratio to talk about nonperforming assets to equity. as you look at the bank picture overall for u.s. banks, are they
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positioned better than just about everybody else in the world at this point? >> i really believe they are we have not seen the system this healthy in decades as you point out, the texas ratio for these banks are very low. the capital levels are very strong and credit remains so good it is a move we have not seen in quite some time. so the picture is very good. what we would like to see, though s a steeper yield curve and rising rates that would be the icing on the cake. >> you and those banking executives take us through some of the ultimate winners based on what we heard last night. who gets paid the most >> i think you identified a few of them. number one, citi group had a great number they paid out more than 100% of earnings in their announcement with their buyback and dividend. i would also point to bank of america. as you have identified, another big winner this year with a big
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number a couple other regional banks. regents financial put up a strong number, over 11550 of earnings going back to shareholders this year a very strong number and discover financial, a credit card company doing a good job. everybody had strong numbers with the exception of capital one and wells fargo, they were a little bit less than expected. generally most banks came in better than expected with numbers and many of them came in at over 100% of earnings >> one quick point here, as you look at the banking seblgctor overall, if you want to look at relative strength and weak ps, wheweakness, where would you look who has the brightest outlook? >> monster banks with multiple sources of revenue are the better places to be and more attractive on a valuation basis, particularly bank of america and
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citi group as you pointed out in your opening about what's going on globally, i would say the economyglobally and volatility picks up that helps the banks. >> thanks for jumping on the line today >> thank you >> gerard cassidy. worth mentioning one spot that potentially was weaker than others was the credit cards. two of the largest issues, capital one and american express had to take down their payout requests >> interesting that gerard mentioned discover financial is one of those as we talk about the banks, it's also interesting to point out, citi group had the biggest boost but also one of the biggest monster banks far away from the precrisis highs. this is a $570 stock at $65 right now. just for perspective >> blue apron pricing its ipo at $10 a share. that's at the low end of the
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reduced range that the company announced yesterday, well below the original estimates of $15 to $17 a share. blue apron raising 3$300 million valuing it at 1$1.9 billion two years ago this company was valued at 2 billion in the private particular kemarket the company will trade under ticker aprn. there's also that amazon whole foods deal taking the sign shine off this >> this is a hyper competitive space. they are the king. >> they are. >> they're a big player. >> they are relatively lower barriers to entry. >> you went to chef school i did. >> do you buy into this meal delivery stuff >> i'm one of those who likes going grocery shopping it's therapeutic for me. i want to go out and do it.
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>> fun fact about dominic chu. moving on to staples, going private. the office supply chain is being bought by sycamore for 6$6.9 billion. reports in april said the company was exploring a sale the buyout comes two years after a federal judge blocked staples planned merger with office depot on antitrust grounds. dow chemical and dupont reaffirming plans to close their merger in august the boards also announcing plans to spin off parts of the combined company within 18 months of the deal closing. shares of pier 1 tumbling after the company announced a major miss they had revenues it of 4$409 million last quarter, $12 million short of expectations. shares are getting slammed, down almost 11% h&m posting a 10% increase
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in pretax profits, the company saying positive results thanks to continued expansion and tighter cost controls. those h&ms and zara's of the world competitive. we have sarepta naming dog also a ingram as the new ceo he will take over as of september 20th. carrizo oil&gas with a public offering of 15.6 million common shares, priced at $14.60 per share. and progress software topping wall street's forecasts. the company seeing q2 income jump by 25%. shares up by 5.5% in extended hours trading. on today's agenda a pair of economic reports and plenty of big-named earnings weekly jobless claims are out at 8:30 a.m. eastern along with the
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third and final estimate on first quarter gdp. growth expected to remain unchanged at 1.2%. we'll be looking for clues if anything changes on what that tells us about the second quarter. james bullard will speak this afternoon in london. on the earnings front, walgreens, along with conagra and constellation brands after the close, micron and nike will be the big ones >> big earnings day. >> nike has a lot to prove there's a big bull/bear debate on nike. north american business is key it's the biggest business, can they turn things around after sales weakened >> and heating competition with addidas. >> there's a lot of addidas retro sneakers on sale it's highly competitive. coming up a flawed person with a dysfunctional personality, that's how martin
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shkreli described him as the trial got underway more on that case straight ahead. you're watchin"wlddeg orwi exchange" on cnbc. so you miss the big city? i don't miss much... definitely not the traffic. excuse me, doctor... the genomic data came in. thank you. you can do that kind of analysis? yeah, watson. i can quickly analyze millions of clinical and scientific reports to help you tailor treatment options for the patient's genomic profile. you can do that? even way out here? yes. even way out here. even way out here? you myour joints...thing for your heart... or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally found in jellyfish, prevagen is now the number one selling brain health supplement
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>> i'm happy with martin's face exactly the way it is. thank you. >> that's good that's martin shkreli's lawyer outside a brooklyn courthouse late yesterday in the pharma bro's trial. he said shkreli may be crazy but definitely innocent. he also quoted lady gaga saying though shkreli is odd, he was born this way. we'll have a live report from the courthouse and with meg within the next few moments. just a little over four hours until we get to the opening bell and it rings on wall street. in the early action those financials continue to lead the broader markets higher after all 34 major u.s. banks passed the fed's big stress test. here to set us up for the day is tom reynolds of the janice hand hand hennwhe
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henderson small cap fun. is this rally in banks for real? >> for now, yes. i think capital return is a great tool to keep the rally going. and for small caps in particular, while they're not si subject to the stress test t will trickle down and the capital you saw proved to getting returned to share holders yesterday and the way that everybody passed indicates a softer regulatory hand which is one of the reasons small banks in particular rallied after the election in november, that lighter regulatory touch >> you expect this to be a more pronounced move? more than the reaction today could they be market leaders >> they could be we're certainly not set up to have it be the market leader, but in the event it does, we're comfortable with our portfolio
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we're equal weight banks, which in small cap is significant. 18% of our holdings. the one thing the small banks have going for them that other sectors don't, you have seen some inputs change there's hope on the agenda for infrastructure, taxes, there actually have been several fed rate hikes, this flows directly into banks, and some smaller banks have seen expansion. >> as we talk about the way financials set up the small cap space, these stocks, this market cap world has been an underperformer will it play catch-up? is there reason to be optimistic overall? >> yeah there are reasons to be op optimistic small caps have lagged this year after a good performance last year the outperformance after the election was driven by the agenda, hope for low taxes,
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lighter regulatory touch, and for infrastructure transactions. as the agenda stalled a bit, that really gave up heading into the summer now, coming into august, if healthcare is put aside and we turn our focus to taxes, infrastructure, you could begin to see a reflation trade put back on, which small caps would be a part of significant amount of that is banks, industrials, materials companies. >> what indication do you have they just delayed the healthcare vote by an undetermined amount of time until they can get their party on board what makes you hopeful about taxes, infrastructure and small caps >> i'm hoping they're moving on beyond healthcare and putting that aside, i think indications are if they can't get healthcare
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done, they will mv on ove on to taxes? >> do you have a couple picks? >> u.s. concrete, i experienced part of their backlog today flying into laguardia. that's a good one. commercial medals company. that stock rallied hard in november after the election. come all the way back down to 19 they basically make long steel that should be going into a fair amount of trucinfrastructure, a trade case review from secretary ross underway that could have wults later this week. >> some interesting picks. tom, thank you very much for joining us tom reynolds waking up with us on "worldwide exchange." >> talking about the trump trade. still ahead, we take you to washington for the latest on the president's push to make america energy dominant. as we head out, a check on futures. right now at least we're showing
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signs of gains "worldwide exchange" about be back after this break. mom gets breakfast in bed...
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welcome back to "worldwide exchange." good morning i'm sara eisen here with dominic chu. we're following a developing story out of arizona where firefighters are struggling to contain a massive wildfire burning out of control as of yesterday, the blaze burned more than 20,000 acres. the massive fire is feeding on
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dry fuel and rugged terrain and gusty winds are creating dangerous conditions many homes and businesses have been evacuated other nearby communities have been put on notice smoke can be seen from the fire from 100 miles away in phoenix we'll watch that story hope everybody is okay and evacuated. we'll keep you posted on any developments >> absolutely. south korean energy conglomerate sk group signing an agreement with continental resources to ramp up a shale gas development. cnbc caught up with continental resources harold hamm to ask about the deal >> this is especially significant because of what it could do to the environment around the world with america's clean abundant natural gas resource it's significant in that regard. >> hamm said besides the
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positive environmental effects of the deal it will allow the company to create more jobs. speaking of south korea, president trump will welcome the country's president to the white house today and it is energy week in washington, and the trump administration will continue their push to make america energy dominant. they have that harold hamm deal to talk about. tracie potts joins us now with the latest what's on the agenda >> the president heads to the energy department to do a speech today about that concept of energy dominance let's talk about what that means. there are two parts of it one we're familiar with and one that is new energy dominance, the united states relying on its own energy, oil, other forms of energy fossil fuels, something that's been a big change from this administration to the last but the idea of the united states not relying on the middle east for energy is very similar to what president obama called energy independence. the other side of this, the president wants to get into the
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game he actually wants to sell energy to other countries and that is something that we'll see, how is that going to play out do these compauntries want to be dominated? how does the united states come on the market with the big players like saudi arabia. he will unveil some of that today at the energy department the other thing is how will this play out with the president proposing cuts in the department of energy and pulling out of the paris agreement. very big differences on climate change some of the things that would have made the united states more energy efficient in that deal, the u.s. is backing away from as the president said he wants to be energy dominant by relying on our own resources. today hope fly we'll getfully w clearer view of what he means by that and how he hopes to accomplish it. coming up a round-up of the
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top stories. the banks getting the okay from the fed. the blue apron ipo, and the pharma bro trial so much to talk about. "worldwide exchange" will be right back minutes old. ♪ a baby's skin is never more delicate. ♪ what do hospitals use to wash and protect it? ♪ johnson's® the number 1 choices in hospitals. chances are, the last time yoyou got robbed.an, i know-- i got a loan 20 years ago, and i got robbed. that's why i started lendingtree-- the only place you can compare up to 5 real offers side by side, for free. it's like shopping for hotels online, but our average customer can save twenty thousand dollars.
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good morning tech stocks in focus after the nasdaq has the best day of the year and banks get the green light for the first time since the financial crisis
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the fed approved capital return plans for 34 of america's biggest banks. we have the latest ahead sfwlo a and pharma bro martin sk shkreli channels lady gaga at the courthouse it is thursday, june 29, 2017, and you're watching "worldwide exchange" on cnbc. ♪ >> we channel lady gaga at every opportunity we can >> there's a reason why "born this way" is important we'll get to that. >> right welcome back to "worldwide exchange." i'm sara eisen >> i'm dominic chu sitting in for wilfred frost. >> let's check in on the global markets. best day of the year for the nasdaq best day in two months forthe other indices. the strength continues, more pronounced in the dow. dow futures up 28. s&p futures up 4 the nasdaq has been wavering
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right now positive futures up 2.5 tech has been a key leader financials really were the star of the action in yesterday's trading session ahead of the stress test results and then even afterwards in the after market a bigger surprise in terms of the cash return in the form of buy backs and dividends from the big bank stocks. we'll hit it in a minute futures indicating higher prices for financials again today there's the etf, the xlf, looks set to open up 2%. ten-year treasury note yelled helping the finals stage a comeback it's jumped from 2.13 earlier in the week to 2.24 so selling of treasury, yields higher, a global phenomenon. it's been sort of moving on this idea that central banks around the world, not just the fed, are looking for the exit in terms of special extra easy monetary policy whether that was the right interpretation of mario draghi or not, that is the feeling today. you see it in global bonds
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you see it in the euro >> look at that chart for ten-year note yields we got the bump today, still in a down trend since march of this year we'll see if it can get above those levels from march and april. >> at one point this week, people were wondering if we were going back down to 2%. oil was falling, all this talk that there was no inflation to be found much the narrative changed over the last few days >> so let's look at what happened in other markets. asian equities generally a positive move here for equities. the japan nikkei up by a half percent. hang seng up by 1% the early action in europe, it was mixed 20 minutes, a half hour ago we are seeing a bit of strength coming out of the ftse 100 delivdeli driven mostly by the banks in the uk we'll watch european markets to
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see if they get a boost from the financials >> what's helping the stock market is a rally back in oil prices after inventories yesterday, we're seeing strength in oil, but not like a half hour ago. we're up 0.4%. wti falls back below 45 brent crude up a third of a percent. 47. 47.47. the dollar index has been super weak soaring to 114 we're at the highest levels in over a year for the euro the dollar is firmer against the yen. and the pound continues to flex its muscles against the dollar 1.29 9 go gold prices under pressure down 0.2%. back to the morning's top story. the fed clearing capital plans for 34 of america's biggest financial institutions the move prompting many of them
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to immediately announce new dividend increases and buyback announcements. citi doubling its quartly dividend to 32 cents a share and announcing a 15$15.6 billion stc buyback program. jpmorgan also announcing its biggest buyback ever at 19$19.4 billion. morgan stanley announcing plans to raise its dividends s by 25% huge moves here. billions being returned to bank share holders in the forms of dividends and buybacks >> the bigger take here according to the "journal" and gerard cassidy of rbc, this is the first time since the stress test began that all tirms gfirm healthy grades, they had enough buffers to return a significant
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portion of their earnings. in some cases 100% of profits to shareholders the "journal" goes so far as to say this could herald the return to pre-crisis days >> gerard cassidy mentioned this is the healthiest these banks have been since before the financial crisis >> he also told you they're the healthiest in the world in terms of global banks, which are rallying altogether today. blue apron makes its public debut today on the nyse. the company priced its ipo at $10 per share. which is way down from the original estimates of $15 to $17 a share. blue apron looking to raise 3$30 million in its debut trading under the ticker aprn. bob pisani saying finally investors are getting lower prices for ipos, post-snap.
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private equity firm sycamore partners will buy staples for $10.25 a share the news sending shares of stap ms s staples higher >> nuts, strange, weird a few words martin shkreli's own lawyer used to describe him. let's get to meg tirrell live in brooklyn with more we've seen some of the action this morning about you cornering his lawyer on the lady gaga lyrics that w >> reporter: that's right. that was his defense attorney. we got a jury for the martin shkreli trial. they moved into opening arguments in the afternoon the prosecution started by laying out its case, running through the indictment and then shkreli's defense attorney ben
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brafman took to the floor saying is he strange? yes, will you find him weird yes. martin shkreli is brilliant beyond words, saying geniuses are just on the other side of crazy. and "as lady gaga said, he was born this way. we caught up with brafman yesterday. >> can you tell us about the lady gaga defense in there >> i think i said what i wanted to say in the courtroom. >> why quote her so many times >> i think the quotes fit. >> with all of these lady gaga references, do you wish martin had more of a poker face >> i'm happy with martin's face the way it is. thank you. >> i wasn't totally sure brafman got the poker face there he did reference two lady gaga songs in his argument yesterday. we expect the trial to continue this morning with witnesses coming in. it's bound to be filled with drama we'll bring you the updates from here. >> looked like martin was trying hard not to react to you asking
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that question. >> he had a poker face >> not so much >> looking at the poker face >> what do we expect today that was really about liz characthis character. is that what this trial will be about? >> they before twere trying to point that perhaps he has a weird character and also that former employees and board members from other companies where shkreli previously worked may testify as government witnesses and they may reveal they had said those things about him, talking about his sexuality, talking about weird behavior he had. brafman trying to say that doesn't matter trying to prove he was bullied by some of these people. but also making the point he's a "boy genius. and that all his investors new that and willingly invested their money with him basically saying these people went in knowingly and made their money with brafman >> you wonder why brafman didn't
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quote wu tang. >> this is a "new york post" story, they covered him. today's top trending stories, happy birthday iphone ten years ago today the original iphone went on sale in the u.s since then the company released eight generations of the product. the first generation iphone had a 3.5 inch screen, 16 gigs of storage, and couldn't take video. compare that to today's 7 plus, which has a 5 1/2 inch screen, 256 gigs of storage, hd quality video. the iphone has been a total cash cow for apple. the stock is up 735% from the first iphone being released. we expect a big one later in the year perhaps one of the reasons that apple's stock has been almost p
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that much. >> my first iphone was an apple 3g >> it has transformed apple's stock price, as a company. it makes you wonder what the next phone will be >> when it will be released. >> and how long it can carry the company. i liked the re/code angle, they have a list of the ways the iphone changed people and society. one of the reasons is that it's helped kill the gum industry and gum sales, down 15%. >> because >> because we used to wait at the checkout line and at grocery buying all that stuff. now we're just on our i phoneip. >> that could be true. >> you're grocery shopping >> that's true i don't buy those things, the
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tab employ tabloids state lottery officials in illinois are suspending powerball and mega million ticket sales until the state's general assembly passes a budget that includes funding for lottery payouts. officials also warn that players who have already won could experience delayed payments if a funding bill is not approved by july 1st according to the chicago tribute, illinois typically profits $90 million annually from powerball and mega million ticket sales, maybe that's the reason everybody should think about taking the lump sum one time payment, especially if budget issues come into play >> what's the hold up? >> i don't know. they have fiscal woes. >> snapchat is upping its filter game the platform now allowing users to create, submit and pay for custom geo filters directly in the app. prices start at $5.99. i guess you used to be able to do this but you had to go to a
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third party app. >> and it cost a lot more. >> the commoditization of social media. >> we'll see how long it takes instagram to do it >> not long, i'm sure. good news for "game of thrones" fans, a new pop-up bar based on the show is opening in washington, d.c. it features a hall of faces, replicas of the dragons, an armory where the house banners are displayed. yes, dragons are part of this. you're a "game of thrones" fan which house do you identify the most with? >> you know i like the mother of dragons. >> yes targarians are -- >> i identify with calissi what about you >> me? i thought about it, i'm also a house star fan >> washington is so nerdy. it is. steph curry is going to play
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with the pros on the golf course the two-time nba champ will compete in a web.com tour event in august. web.com is like the minor leagues for the pga tour >> it is >> last month curry was on the golf channel and was asked about playing golf as a second career. he said his passion -- he does have a passion for the game. he's not sure if that's in the cards after he retires from the nba. on twitter steph explained why he decided to participate in the tournament he said he has no expectations except to keep the ball out of the gallery and not go happy gilmore. >> you know him, you interviewed him before he's a single digit handicap i hear a 5 he plays well enough to compete. >> really. he just plays for fun. >> he's a great golfer >> of course he is >> just good athlete. coming up on the show, why a former cia officer says the gop is at risk of becoming aluned with putin today's must-reads are ahead. as we head out a check of
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early action in european trading. the banks are the stand-outs overall a mixed to down picture. the dax down 0.2 france down 0.6% the ftse 100 holding up strong energy and financials helping t. "worldwide exchange" will be right back mom gets breakfast in bed...
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welcome back to "worldwide exchange." good morning i'm sara eisen here with dominic
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chu. it's time for our must-reads my pick is in the "washington post." "republicans are risking becoming the party of putin. it's penned by evan mcmullen, former cia operations officer. he ran as an independent candidate in the 2016 presidential election. never got traction really. maybe in his homestate of utah a bit. has been since very critical, especially on russia and president trump. now the republican party which he says these dangerous trends, he talks about the pro russia change in the party and in the voter base, impaired the nation's will to protect itself. they are entirely the result of republican leadership's failure to oppose trump from the beginning. republican voters long held a healthy distrust of putin but trump's affinity for moscow are changing republican voters minds. now making it politically costly
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for gop leaders to defend the nation from the foreign adversary. he lays out the threat and also lays out the -- the bill in the senate to get sanctions and why it's so important. how it's getting watered down by leadership, especially in the house that are posing it and want it to go to the house first and warns about that he's not going away. i think it's further evidence of a split in the republican party or at least a change when it comes to dealing with russia and trying to figure out the alleged hacking into the election. >> it's also an identity thing now for everybody in the party trying to figure out how they want to at least tact themselves >> we will see what that meeting at the g20 yields. my pick it in the "washington post." "forget the $15 minimum wage here's what a sensible compromise would look like." there's a debate about whether
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raising the minimum wage would be a good thing. we need a more intellectually honest minimum wage debate one that acknowledging the intuitiv moral appeal of exploitation of low skilled workers and a wage so high that hait harms the ver people it's supposed to help congress should benchmark the minimum wage level to historical data, then connect it to an inadjustmeina inadjustment factor. it's a systematic way of looking at it. >> there's not a lot of conversation about raising the national federal minimum wage. cities are going it alone.
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states are doing it on their own. 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 you have to beat yesterday's lineup >> you're making it hard we have senator pat toomey who will talk about tax and healthcare we will talk about energy week scott sperling will be with us, and professional tennis player james blake will be with us. and talking about my neck problems i had some accupuncture done yesterday and cupping. you have had that done before? >> i have. it's painful >> you guys have both done cupping? >> yes >> they did the cupping first and then the acupuncture >> are those the marks on your back >> she said do you have the backs on your back i'm not as ripped as michael phelps, but i do have the cupping. >> all the models and actresses have the marks on their back so it's cool >> i'll take what i can get. >> hope you feel better. >> thanks. still to come, nasdaq
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futures just turned lower following yesterday's rally, best since november for the nasdaq we'll set you up for the big adg y ahead when "worldwide exchange" returns (upbeat dance music) (bell ringing)
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welcome back to "worldwide exchange." i'm sara eisen with dominic chu. dow futures are up 19 points s&p is up 2. nasdaq down 3.5. maybe catching its breath after a strong broad based rally yesterday. nasdaq's best day since november joining us is alan ruskin from deutsche bank. it's a perfect day to have you here to help us make sense of some of these big moves we're seeing in currencies on the back of central bank speak. euro to 1.14 does that make sense to you? >> it does, but in some respects you look back and say we're going up on euro/dollar despite the fact that short-term interest rate spreads are moving in the other direction and
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suggestive of more like a parity level. i think what you've seen here is a shift in terms of euro risk premium. people think politics is a clean slate for this year at least longer term investors are underinvested in euros and coming back into the market and buying euros >> if you look at the picture for euros overall, is there a sense from the multinational corporate side of things that they're well positioned with the way euros are moving now or that it does need to move perhaps further down back towards that parity level in order for people to feel bansed about what's happening? >> i think people are feeling offside in terms of the euro going up after such a long period after there were so many doubts about the euro and the longer term performance. now people are having to catch up with this euro move it drags people into buying euros as the euro goes up
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reinforcing the move >> so is the stronger euro good for stocks overall or negative it seems like the u.s. market was getting comfortable with the weaker u.s. dollar broadly is that going to still be the trend? >> it's somewhat helpful for u.s. stocks not terribly helpful for european stocks. there's a relative play there. a lot of different things are going on here now. oil is important softer oil prices are helpful for global equities, and it's keeping bond yields lower, which is crucial for stocks as a whole. >> so the inflation picture, i'm looking at the st. louis fed's website for the ten-year break even rates, they've been trending lower since the beginning of the year. is there an inflation picture that you see developing that really does affect the way that currencies will move now despite the fact that we have apparently no signs of
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inflation? >> the way the central banks are taking this lower inflation environment is an oddity in a way. they're using oil in a certain extent as a foil they're using this as an opportunity to tighten because financial conditions are solid so equities are not going down, bonds are not going down they're saying look, we've created asset inflation. we have not created goods inflation. i think they're wary of a financial cycle, and there's so much acid inflation in the system >> very quickly, we heard from carney this week he's talking about higher interest rates in the uk draghi talking about reflation is this an inflection point in global central banking away from easing policy? >> it does feel that way it feels like there's a shift in tone here. there are at least four central banks that have already spoken in ways which sound more hawkish. >> alan ruskin, good to talk to you of deutsche bank
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thank you.com, fdo, m for beinge "squawk box" is next
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good morning markets bouncing back. stocks rallying as the s&p 500 scores its biggest one-day gain in about two months. plus big banks passing the fed's stress test. share holders are reaping the benefits this morning. plus investors losing their appetite for blue apron. that's how it appears. the company's ipo pricing at the bottom end of the range. it's thursday, june 2920, 2017, "squawk box" begins right now. ♪ >> live from new york where business never sleeps, this is
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"squawk box. good morning 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 joe is off today let's look at the u.s. equity futures. we are poised to open higher, at least for the dow and s&p 500. looks like the dow is up by 24 points after big gains yesterday. the s&p had the best day in more than two months yesterday. it's indicated up by 3.5 points. the nasdaq had the biggest one-day gain since november 7th. this morning slightly negative financials look to be big gainers this morning after gaining yesterday. we will talk more about that the nikkei looks like it closed up by almost half a percentage point. the hang seng up by 1.1% the hang high up by a half

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