tv Squawk Alley CNBC October 5, 2017 11:00am-12:00pm EDT
consumer staples leading so far. other leaders include walgreens, all up by around a percent. staples up five percent. that does it for this hour. let's send it to the start of "squawk alley." back over to you. >> good morning. it is 8:00 a.m. at amazon headquarters in seattle. 11:00 here on wall street and "squawk alley" is live. ♪ ♪ welcome to "squawk alley."
here with me at post nine, michael santoli, carl has the morning off. and to our top story, facebook fighting back stepping up its response to questions over the role of 2016 presidential election and alleged russian meddling taking out full page ads with the tag line we will fight any attempt to interfere with elections on facebook. reportedly hiring consulting firms to better communicate with lawmakers in washington as facebook and twitter commit to sending representatives to testify before congress on november 1. henry, this one keeps getting hotter. brad smith we had at cyber summit yesterday was saying he had just gotten back from d.c. for the summit. this one is hitting lawmakers where it counts because this is about constituents, social. that's politics.
>> you are having a collision of most powerful media and communications platforms in the world with an industry that everywhere else has been fully regulated for years and the analogy would be if we discovered that comcast tv networks had been used to sway the election without the company knowing just a tremendous scandal. >> i think facebook and google and other big plat forms have to get in front of this. the other day we were saying that within hours you had huge conspiracy theories being distributed because folks were really fast suddenly they get the same distribution as nbc u or "new york times."
imagine nbc news is effectively hijacked by somebody who wants to say this is a muslim undertaking and nobody is noticing or controlling that the companies have to do something about that and they will. >> what getting in front of it means? after all of these years google's search engine results are gained is there any real radical adjustments to the whole business plan of facebook at this point >> not a radical adjustment of the business plan. recall six months ago a big scandal that youtube had advertisements next to inappropriate hate content. youtube created another tier that is much more policed and regulated that they can say is a safe zone for advertisers. they have to do the same thing on the content distribution point of view. when you have google news and google putting a brand on something you don't want conspiracy sites right up there.
>> sounds like you need to know your customer laws almost like with real estate or banking. >> these are incredibly smart people. hopefully these events with the election will raise the priority of this and they will fix the problem. if congress gets involved and starts regulating facebook it will be a disaster. hopefully facebook can figure it out on their own. >> it is almost like you are saying you believe legislation is inevitable so getting in front of it must mean helping to write the legislation? >> i think if facebook and google can persuade congress that they can handle it and we see changes legislation is not inevitable. >> can't you see something so basic like there are so many rules about election ads on tv why wouldn't you do the same to facebook >> it should absolutely be extended to cover them. come back to fake news we have the president of the united states saying nbc is fake news. how do you get congress to agree
on you can have this platform but not that one very tough to do. amazon reportedly testing its own delivery service to rival fed ex and ups. the new service is intended to make more products available for free two-day delivery. the move would also relieve overcrowding at amazon's warehouses. shares lower on the news. when you first saw amazon buying planes they said don't worry about it. we are not trying to compete with ups and fed ex. this is just a little additive. it seems to be getting more and more real. >> they are creeping in that direction. this is a program they tested in india and bringing in a pilot. not like they try to cover the united states instantly and compete directly. as they build the distribution infrastructure setup for e commerce and the last mile delivery they are trying to get more density and use out of it by expanding as they are and
this one makes sense for merchants and helps with customers. amazon's world domination plans continue to astound everybody. >> the stocks act like this move is at the expense of fed ex. >> that said amazon did a very bold thing recently in whole foods. i don't know why that is inconceivable given why they are. >> they don't want to re-create the entirety of this industry on their own but they make such heavy demands on transportation delivery infrastructure that does it make things less attractive for ups if they are on this side of the negotiating
table with amazon on the other one saying we are going to do it ourselves if we have to. we had an analyst saying that is the way we will go. >> a new way of distributing goods and are building an infrastructure perfect for that. it will be different than fed ex and ups. it is clear with whole foods they are expanding more and more into physical infrastructure. >> are there dangers of amazon going down this path kind of hurting partners in a way that could back fire? >> i would think both folks are so dependent on amazon as a customer that they are not going to cut amazon off. >> it's just at the margin. they are testing one market. if it became a huge hammer to the business i think you would see a lot more. >> and finally shares of netflix moving higher. the company says it is raising prices for some streaming plans by as much as ten percent as it
adds and improves the netflix experience. the change will impact most of the u.s. subscribers. last time netflix changed prices was in 2015. i thought they said that they weren't going to keep doing this but does it just mean the audience is so captive they feel like we can get our money. i thought they would say they would charge for the 4 k content. >> taylor swift every other year. >> for a while, absolutely. netflix, the reason netflix is doing so well, it is a much better modern tv network. much more content. allows you to watch whatever you want to watch on any screen. when you look at it on a per hour of consumption it is way below traditional tv. there is going to be some churn, but folks don't like price increases. netflix is still a fantastic deal relative to traditional
television. >> i think the customers, their list of complaints about netflix probably don't start with how much per month. it probably falls off the list, how fast it can load. i do think that they are probably correct in the calculation. it has been entergle to the bull case on the stock. >> they split into tiers now this particular middle tier that they are raising allows two simultaneous streams and then the family plan. >> the stock acts like a pricing power. clearly the investor isn't worried they will lose subscribers. >> they will lose some. >> not meaningful. >> goes back to when aol was raising prices. most of that drops to the bottom line and gives more money to inve invest.
>> is this a sign we are getting milked. maybe netflix feels like we don't need growth in s subscribers. >> milked. you are free to quit. you don't like the $11 of value per month. always up. >> worth every penny. >> still a great deal. >> how much it costs around the world is a good indicator of the local economies. >> great to see you. >> getting milked. coming up, record highs for the nasdaq and s&p 500. we will track the next move in a moment. why does the mayor of san jose say he is not bidding for amazon's next headquarters
hiemer funds. good to have you here. why is the market at new highs are these levels justified >> absolutely. if you look around the world we are going through a synchronized global recovery. inflation is low, rates remain low. everything is falling in place. i think this rally we may be at the highs but i think we have upside left. >> how much? >> i think five percent and maybe low single digits on 12-month basis. mid to high on a 12-month basis. >> are you as bullish? do you think these levels are justified? >> i think you can justify them. my friends at wells fargo think we might have a bit of pullback into the end of the year. everybody seems to be getting excited about low volatility and prospect of santa claus rally. sometimes when everybody is expecting it it doesn't happen.
when i look out over the next 12 months i like to think more in terms of a reasonable range for markets. i think we are within that range. the primary drivers economic growth, all of those are pointing towards continued gains for the market over the next 12 months. when we started the year i thought we hit 2650 at some point during the year. maybe we will get there. to me that was a bit of a stretch goal. if we get earnings season and tax reform if both come together sometime in the end of october, beginning of november i think that could push us to continued new highs here. >> brian laid out a lot of the inputs, conditions that allow the markets to do what they have done. very good global growth. all things coming together. the policy piece has always been kind of out there in front of the markets but not entergle.
if we near a point where 2018 earnings estimates will be dependent on whether we get corporate tax relief is that where the markets have a little more vulnerability if we don't see the progress >> i think there is some truth to that. however, i think the earnings momentum is driven more by the strength of the global economy rather than just expectations with respect to policy initiative or easy money policy or tax reform. we think that even if we don't see anything from washington the likelihood that earnings are meaningfully higher that is good. if we get tax reform that is gravy on top. if we don't get tax reform at any one point we may see a bit of a pullback. i don't think that is really the driver of the markets at this point. >> you mentioned synchronized global recovery. does that mean you can buy
anywhere in the world? if you can invest anywhere in the world would it be united states >> i think the best value and the best opportunity in our mind is really in emerging markets. in emerging markets the growth outlook is improving. it is becoming less china dependent and valuations are much more attractive than in the u.s. we like the global equity market. if we have to pick one area we have to say emerging markets probably the best opportunity in any place in the world. >> same question to you. >> we have been encouraging our clients and positioning portfolios to overweight non-u.s. equities. right now trading at 5.5%. u.s. is about five percent. think about the growth that can support those cash flow yields. you are seeing that more in the emerging markets. analysts expecting 19% growth in the long term. in the u.s. it's about 11% growth. i think emerging markets have a
nice combination of attractive valuations and growth prospects to support the valuations going forward. >> agreement there on where to put money. thank you, guys. >> thank you. still to come, why a new jet making startup is turning heads at boeing and jet blue. why the mayor of the biggest city in silicon valley says he is not offering a sweet hard tax deal to lure amazon's new hq 2. i sat down with white house cyber security coordinator at the cyber summit talking about the executive branch's new ask for silicon valley when it comes to encryption and criminal investigation. rob joyce who used to run the nsa's hacking says white house is no longer looking for a back door. >> has the conversation moved? are we on a different point from where you sit in the white house than we were a year ago?
are you asking for a back door >> we are certainly not asking for a back door. what is really important for us is strong encryption is good for america, good for business, good for individuals. it is really important that we have encryption and strong encryption and that is available. the other side of that is there are evil people in this world. and in the end the rule of law needs to proceed and so what we are asking for is for companies to consider how they can support legal needs for information. things that come from a judicial order, how can they be responsive to that if companies consider from the outset of building a platform how they are going to respond to those asks from a judge's order we'll be in a better place. hi, i'm the internet!
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a new startup is getting attention of boeing, jet blue and others. phil lebeau is in chicago with the story. >> we talked for some time about hybrid electric cars. take a look at this. this is the zunum aero. this is a plane being developed out in the seattle area. because of the hybrid electric batteries becoming lighter it will be cheaper for operators according to people who run zunum aero and they believe this will be much more attractive. >> this can allow you to by pass the hub system on short regional flights and get you to your destination two to four times faster than you do today at
prices below commercial. also, they cut down emissions by 80%. >> so here are statistics or data point that you need to know about with the e-plane. it can seat up to 12 people. there are three configurations. the range and it does have a gas turbine assist engine. 80% lower emissions and the funding some of it comes from boeing and also from jet blue. these shares are close to an all-time high. the company announcing that it has bought aaurora flight sciences that develops technology for autonomous aircraft, future technologies moving into airplanes. this is going to be a big push not only for boeing but air bus and everybody in the aviation industry. >> i have long wanted autonomous
cars. autonomous autonomoircraft i dow if i can wrap my head around that. >> don't want to show my age with my fear. thank you, phil. amazon's search for the home of second headquarters losing at least one potential bidder. the mayor of san jose penning editorial titled why i am not bidding for amazon's second headquarters. we are joined by the author of the oped. good to have you here. >> good morning. good to be with you. >> good morning. you make the point that you do not want to offer tax breaks or other incentives to bring amazon to san jose. why not? >> because what we said was that not that we would -- and we wouldn't offer tax. it's a bad deal for taxpayers.
>> why >> well, what we typically see these decisions are made in corporate board rooms focussing on one key above all others which is talent. these companies like amazon want to be where the talent is. there is no amount of public subsiddy whether in the form of a tax break that will make an investment happen if the workers are not in the city with the skills ready to roll. and what we know -- >> let's presume you have those skilled workers, the argument always is and the reason that we have seen cities in wisconsin or the state of wisconsin try to get is you offer break on taxes. that leads to short fall in revenue. however, you create so many more jobs that you actually improve the local economy and end up bringing in tax revenue. why wouldn't that work for san
jose >> we typically see the amount of tax dollars that get spent per worker are far greater than the benefit. and it is important also to distinguish what kind of jobs we are talking about here. companies like amazon that are driving innovation are not looking simply to put a manufacturing facility anywhere. these are folks who are looking for software engineers, the computer science talent that is not found anywhere. so they are going to be focussed on talent first. overwhelmingly what we have seen in economic studies as well as our own experiences that are good to lure in and those companies are likely to leave as soon as it is consumed. >> as a long time san jose resident i lived there about 14 years. i am familiar with where you are. google is moving in.
apple has offices there already as does amazon. does your statement apply more to the really high end engineering jobs that are what silicon valley is all about? what about wisconsin what about some of these other places that are looking for manufacturing jobs maybe tax incentives really would tip the scale. >> well, what has been proposed by amazon is really a headquarters. that's not really -- >> i'm not talking about amazon. i mean, if you were in wisconsin competing for another type of facility might it make sense >> i think what we have seen in the past a couple decades ago is that as soon as the subsidy is expired those companies are uprooting and moving to mexico. if it is all about simply racing to the bottom with the lowest cost and highest subsidy
companies can move. cities need to understand we need to invest in infrastructure both physical and human infrastructure that support economic growth and not simply throw out a lot of money hoping that companies will bite. >> mr. mayor, you did have conversations with amazon, no? >> certainly amazon is in my city now. they have a small outpost of lab 126. i'm not engaged with amazon over this particular. >> so reporting indicates you did have a conversation with them. did you pen this op-ed because you knew you weren't going to win? >> no. actually, i'm sure there is land to make a proposal in my city for amazon to come and we would love to have them. the bottom line is it will not be accompanied by a big subsidy
from city of san jose. it is not going to be on taxpayers back. >> thank you for calling in. we know it is early out there. >> thank you. it's a pleasure. it is just about 11:30. let's get to seema mody with the european close. >> the german dax pulling back one day after posting that record high close. spain continues to be in focus. spanish market rebounding from biggest one-day decline in over a year which was driven by this escalated tensions over c catalonia's push for succession. you are seeing stabilization in assets. spain's constitutional court has ordered a temporary suspension of catalonia's planned parliamentary meeting slated next week. the spanish banks are leading the rebounds.
sharply on news the board will need to discuss moving headquarters out of bars loania. the financial times reporting that caixabank is considering a move out of barcelona. the ten year yield falling after three consecutive days of increases. spanish bonds are still on track for their worst week in three months. late yesterday standard ask poos did put the ratings on negative on the standoff. take a look at currencies. the euro is down from highs of the day following release of latest ecb meeting minutes which shows policy makers did discuss options. the euro added 117 against greenback and finish with stock of the day.
uk-based theme backed on reports of offering to buy part of sea world. up 3%. >> i see sea world stock down after popping yesterday. we'll keep an eye on that one. let's get to sue herera with the news update. >> i'm sue herera and here is what is happening at this hour. multiple senior law enforcement officials telling nbc news las vegas shooter stephen paddock researched possible locations in boston and chicago. russia's defense ministry releasing new video on air strikes. it killed 49 militants including seven of the field commanders. police activity continuing at barcelona's main court. spain's constitutional court
ordering temporary suspension of parliament where regional officials are expected to vote. and the nobel prize for literature has been awarded to ishiguro best known for the remains of the day. the swedish academy says his eight works were works of emotional force. congratulaons tito him. that is the news update this hour. "squawk alley" is back after a quick break.
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amazon and others under pressure for european regulators from congress and the president himself. a few consumer facing tech ipos off to a rough start as they make their public market debuts. we take a look at snap, blue apron and roku. managing director. josh spencer is portfolio manager with global technology fund. when you look at what european regulators are doing you think this is just an attempt to take silicon valley to the wood shed because they are not domestic. why are you convinced it is that and not what we have seen over the past couple of decades >> i think we can talk about tax and what right taxation is. what the european union is doing is really about antifree trade. they are trying to control american companies and penalize them for their success.
>> josh, looking at some of the recent ipos how they have perform ed is this just a communication problem or something deeper >> it's not one answer for every company. what i think we're most interested in at this point in the economic cycle and tech cycle are companies that sort of have proven dur abability and a real financial model that scales. i think some companies that have ipoed recently lacked that tangible not just because of choices but because business model doesn't support it. i think it is time to be conscious and thoughtful about the type of companies you are investing behind. >> josh, if we take that line of reasoning a little bit further does it mean it is more likely than not when we do see a tech
company poised to go public that there should be an immediate skepticism that they should have to go public >> i would say there are always very good companies in the private market that can come public at any time and sometimes companies make that choice for the correct reasons and sometimes they are making investments in their businesses that are supported by the long term outlook. that said, over the past couple of years we have seen a lot of ipos where the business model didn't support financial success either in the private market or public market and it is not about choices but just about a business model that wasn't there. >> i want to go back to what you were saying about the eu and taxes and how they are attacking american companies. it gets to the heart of the whole issue with tax reform and corporate tax reform when you have all of this money sitting offshore, bureaucrats all over
the world want to try to get a piece of it, don't they? if we had a much better corporate tax rate wouldn't be incentivised to do all they do in europe and give them the excuse to do what they do. >> i totally agree. we need to create tax reform to bring back the hundreds of billions of dollars that is trapped overseas. the longer it is trapped the easier it becomes a honey pot for european regulators to go after. we need to do it in a way to help companies in america. we want to make sure that the small businesses of america have the right tax structure to have pro growth strategy. >> why do you think europeans are so anti-the american companies? you make it sound like more the tax policy >> i think they feel like american companies have grown powerful and feel the u.s. government has gone after the banks and look at it as a way of
european protectionism. there is a feeling that some internet companies have become too 30u6powerful and need to col them. >> when you look at some of the companies that are newly public, you have snap and blue apron and roku has done pretty well. do you take more lesson from roku and how it priced, how it handled the ipo or some others that haven't done so well? >> well, it is a good question. i would say in that initial trading in the first few days it is very difficult to draw a longer term conclusion around it. for example, if you think around the way facebook traded post its ipo and the success it has had subsequently i would be hesitant to draw too much into the first couple of days of traded because of liquidity and because of
excitement that can happen. i guess i look more about the underlining financial models. in those three companies so far it hasn't been there. i just don't think that those companies show the type of durability that you would like to see in your investments. >> we will leave it there. josh spencer from t. rowe price. when we come back the white house reyunts wiunites with som famous ceos. this time talking about space travel. first rick santelli, what are you watching at this hour? >> pretty darn crowded today. think short maturities, think short rates. 1.49. we are slowly rising above at rnt extremes. th'seally important. tune in after the break and we'll tell you why.
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now, let's get out to the cme group. rick santelli has the exchange. >> i want you to look at a couple of charts as i start. first of all, the two-year note has had a bit of a large move of late as you see on this bigger chart starting this summer. if you look at intr day chart you see knocking at the door on 1.50. on intraday basis it definitely had the pits a little excited
today. we had jim grant on earlier. he said a phrase today that he said the last time he was on and for those who read his news letter are familiar, radical policy begets more radical policy. that is a wonderful expressive way to understand and look at the markets we are in today because there is this notion that the reversing of policy by central banks would be like peeling back an onion. they did these things and will slowly peel them away. the problem is that jim grant's comment does hit home. there is more than just reversing policy because unfortunately policy might be easy to reverse and our leaders at the central bank say it will be boring and you will sleep right through it. that isn't going to be the big issue. the big issue is that you have actions, reactions, allocations
and rotations. in other words, for all of the policy there has been lanes created that would have never been created. in other words, if -- let's take what happened in puerto rico. let's look at junk bonds and high yield bonds and questionable paper with high yields. why do smart bankers and smart brokers put clients in some of the paper? one reason is because there is so few choices to try to expand the portfolio performance. so you end up going to much more risky areas. that's sort of by design because t the stock market is considered less risky. but the problem is that the missalicated capital, all the things that like in physics, action/reaction that would cause investors to move money in certain areas and all the rotations thereafter, those
can't be reversed like levels of an onion. those are here. the unintended consequences and how that will pan out nobody knows. the balance sheet reduction in and of itself might be a snoozer. what that is the catalyst for most likely won't be. back to you, mike. >> nobody knows. pretty good bottom line. when we come back ceos return to washington two months after disbanning of presidential policy panels. this time talking about tufure of space travel. details when "squawk alley" returns. ♪ traders -- they're always looking for advantages. the smart ones look to fidelity to find them. we give you research and data-visualization tools to help identify potential opportunities.
big news on the big u.s. government budget. >> the house has passed its fiscal 2018budget. right now that vote tally looks to be 219-206 with no democrats supporting this budget resolution now, this had been a critical vote for republicans, because it starts to unlock the special rules that they want to use to pass tax reform. you heard a lot of debate on the floor over the cost of any tax package. the house budget resolution actually calls for deficit neutral tax reform it's the senate version of the budget that allows for a $1.5 trillion plan, and it's going to be up to the upper chamber now to get that passed and then the two sides will have to come together and agree on a final version. i saw house majority leader kevin mccarthy in the hallways earlier this morning and he was
accosted by a woman who yelled out "no to the taxes." he jokingly responded to her, i don't like taxes either, but that was just a little taste of the opposition that republicans will be facing as this tax debate really begins in earnest here in washington we will see how that continues to play out throughout the day back over to you guys. >> the process is so byzantine to me, but i want to underline this needs to happen in order for tax reform to happen, right? >> that's right. they need to get that reconciliation process started the way you get reconciliation is bypassing a budget. >> okay. and when was the last time that we actually passed a budget? it's famous, right for years we haven't had a budget >> they passed an fy-17 budget and that's how you got the reconciliation instructions which allow republicans to pass a bill with a simple majority vote they passed that in fiscal 2017 in order to allow for the repeal and replacement of obamacare
that expired on september 30th and now they have to start it all over again to do tax reform. >> thank you. >> no problem. sticking with washington here, the white house reuniting with ceos today convening the first meeting of the nationa space council in more than 20 years. today's summit bringing together ceos and executives from lockheed, boeing, spacex, rex tillerson is there, the vice president as well. morgan brennan is monitoring the events from headquarters what's going on, morgan. >> the national space council holding its first meeting in 25 years. this is led by vice president and council chair pence and who's hearing testimony on everything from national security to commercial enterprises. so this is a who's who of aerospace and defense, including lockheed martin's ceo, spacex president. the focus, space exploration, including a push to return americans to the moon.
this is something the trump administration has expressed some very serious interest in doing. so orbital's dave thompson and bob smith both saying that lunar colonization is doable and the boeing ceo adding that automation and robotics are also big opportunities. >> we see the opportunity for zero gravity, low gravity manufacturing as being a viable commercial practice in space at some point that could either be in low earth orbit or lunar as we're doing on earth with combinations of humans and robots working in our factories, robotic application to space manufacturing i think is another leading edge technology area, an important place for america to lead. >> of course all of this bringing us closer and closer to that mission to mars guys, all of this is really not possible without the commercial sector, without these ceos and
these companies to usher in a new era for american space >> low gravity manufacturing, i had never thought about that yeah, i guess heavy stuff could be manufactured on the moon. thank you very much, morgan. let's get to eamon javers in d.c. this is the first time we see a lot of ceos back in d.c. after the disbanding of the council. >> reporter: we used to see this as a weekly event and that has petered off particularly after charlottesville and you saw them resigning in protest this one is a little different you heard morgan say two words that give you the reason why this particular council and this event is different from some of the others it's federal funding in the defense and aerospace sector, federal funding is the linchpin even though these are private sector companies, the space industry couldn't exist without all the federal money that goes into it to launch satellites and do all the things the united states does.
that's why you're seeing these ceos more willing to show up you look at marilyn houston, for example, she's somebody as you look at the members of the business community who are at this event today, she's somebody who ultimately did not resign during the kerfuffle over whether ceos would resign. she never did resign denn dennis mulenberg of boeing, his comment to cnbc at the time, he was going to stay on that council even though it was later disbanded. spacex is the company where there has been some tension. elon musk resigning over the paris climate accords. and blue origin, that's jeff bezos company. and the president has gone after jeff bezos time and time again on twitter he's the founder of twitter, but this is a different industry and that's why you're seeing industry leaders willing to come and participate in an administration event here today. we'll see if that spreads out to the rest of the business
community. but so far defense and aerospace very much willing to come here and engage on this topic. >> i guess we don't actually see elon there or jeff bezos there that's probably telling, john. >> or the president for that matter. >> right. >> nobody has a problem with mike pence anymore, it seems, relatively speaking. interesting. especially that low gravity manufacturing. i imagine manufacturing is one thing, it's the shipping charges that get you >> amazon does it for free as long as you're a prime member. "squawk alley" is back in a e w neme thdojos industrial average is higher by 83 points intrasession high.
apple ceo tim cook paying tribute to apple co-founder steve jobs this morning on the sixth anniversary of his death cook tweeting remembering steve today. still with us. still inspiring us make something wonderful and put it out there jobs passed away at the age of 56 after a long battle with pancreatic cancer. guys, six years. in a way it feels like a short time, but tim cook now has actually had stewardship over the iphone longer than steve jobs did. >> it's surprising it's been stk
about can apple sustain the franchise and everything else and it's continued on to new powers and new heights. >> certainly with the stock performance. as well as did they institutionalize the magic that was steve jobs i don't know that we have the answer to that yet but certainly the stock has done just fine under tim cook. >> some would argue, at least the stock price would argue perhaps they have. thank you. that's it for "squawk alley. we'll send it over to "the half" with scott wapner. and welcome to "the halftime report." i'm scott wapner our top trade this hour, big tech's big boost microsoft leading it today the etf for technology hitting a better than 17-year high let's begin with tech. we can talk about the markets to be honest with you guys because as we come on the air today in general, new highs again, new highac