Skip to main content

tv   Worldwide Exchange  CNBC  October 11, 2017 5:00am-6:00am EDT

5:00 am
the record rally rolls on. the dow set to open at another all-time high as we gear up for earnings season. your early morning setup is straight ahead. the death toll rises in northern california as a string of deadly wildfires continues to tear through the heart of wine country. we're live on the scene with the latest and it's a sign of the times for "time. the magazine giant is turning a new page in publishing it's wednesday, october 11, 2017 "worldwide exchange" begins right now. ♪
5:01 am
good morning very warm welcome to "worldwide exchange" on cnbc. i'm wilfred frost. sara eisen is off today. let's get straight to the global market picture comes off a day of record closes and intraday high for the dow. it was only up 0.3%. the s&p up 0.2 the nasdaq the laggard up just 0.1% the dow is holding on to a bit of green this morning, which would be another record high potentially up 0.1 points. the nasdaq down 4 or 5 points. treasury board, we have seen yields slip a bit since the highs of last week we got close to 2.4% last week, back down on the ten-year to 2.34, 2.35%. that slippage did hurt the dollar a bit yesterday asian equities, the japanese nikkei closing at a record why
5:02 am
not seen since prethe asian financial crisis, december 1996. this is a fresh high for the nikkei since then. it's take an long time to get back up to that level. one forgets way back to the asian financial crisis up 0.3% or so today. hong kong down shanghai up. australia the leader of the pack let's look at european trade we're seeing a bump for the spanish index. up 1.26% it's the stand-out performer as the leader of the catalonian government pulled back his calls for independence he will go for negotiations instead. we will have an update from the ground in barcelona in the middle of the show let's look at broader markets. oil enjoyed a nice jump yesterday after the opec general secretary urged u.s. producers to limit their supply. that saw a decent jump back
5:03 am
above $50 a barrel 51.25 this morning dollar board for you slipped a bit yesterday. down a half percent. slipping a bit today not significantly. the euro up 0.1% the dollar down 0.2% against the yen. gold prices, gained 0.7% yesterday in face of that softer dollar today basically flat 1,292. we are continuing to follow that developing story out of northern california at least 17 people are dead and thousands of structures have been destroyed as fast-moving wildfires ripped through the heart of california's wine country. let's get to aditi roy in napa. >> reporter: good morning. we are in napa, and it's burned to the ground. all that remains is rubble some of it is still smoldering it's one of four wineries in napa that have been completely destroyed or significantly
5:04 am
damaged by these wildfires this list could grow even longer that's not all there's dozens of hotels and wineries that remain closed because the wildfires. these are not places that have suffered damaged but closed because of the impact of the wildfires. if you look at the list of these names, you might recognize many of them. many of them are big, recognizable and posh hotels in the area they include meadowwood, the carneros resort and spa and silverado resort and spa among the wines, hess, opus one, and stags leap those are just some of the wineries affected it's not just napa, there's lots of wineries facing similar challenges in sonoma county where they have seen more of the brunt of the wildfires we caught up with one winemaker
5:05 am
who lost his winery, paradise rich winery. he tells us even though it seems like a total loss, he is hopeful he will rebuild. he is not worried about the long-term impact of the wildfire because he says the soil is regenerative and that brings us to our final note. the napa valley vineyards association tells us that 90% of the harvest is already done. that's a small silver lining in what that proven to be a devastating story here >> thank you very much for that live report. moving on to a developing story out of north korea, the u.s. military flew two strategic bombers over the korean that peninsula late yesterday the show of force was part of joint military exercises with south korea. this after trump met with top defense officials to discuss how to deal with north korea. the fed will be in focus minutes from the fomc meeting
5:06 am
last month are due out at 2:00 p.m. we will hear from charles evans, bill dudley and san francisco fed president john williams. blackrock and delta air lines both report results before the open catch an exclusive with the blackrock ceo, larry fink, that's at 6:30 eastern time. later on "squawk box," an interview with the delta air lines ceo, ed bastian at 7:00 eastern. things kick into gear this week when we hear from citi group and jpmorgan tomorrow. goldman sachs next tuesday chris whalen is here with me, chairman of whalen global advisers good morning >> good morning. >> let's talk about the banks. kick off with the juicy trading part of the banks. which always gets focus, much to the disappointment of some ceos.
5:07 am
it's been an area of disappointment for some of them. guidance has been tough for some in the quarter >> i think they all guided down. the street estimates are relatively light some are negative for the quarter. the best is bank of america, which doesn't hang its has the on trading so much, though they have merrill, but it's not a trading shop the way goldman and morgan stanley is. expectations are dampened. >> comps are tough compared to the same quarter last year within trading, all the focus on goldman sachs which relative to peers has underperformed over the last couple of quarters. do we expect that to be behind them now or still struggling >> it's impossible to say. so much of this is driven by customer inquiry banks can't trade their own account. so it depends on activity levels in debt and equity issuance in equity is weak issuance in debt is strong probably another record quarter. so you balance that off, you say
5:08 am
how does that follow the bottom line it's marginal. bond deals don't make as much money as equity deals. >> in terms of the retail part of the banks, net interest margin disappointed a bit last quarter. will that start to improve >> the irony is that the fed engineered a record stock market, but they're making it more and more difficult for banks to make money because of credit spreads you cannot leave the portfolio as it is and pretend that you can reprice benchmark rates like fed funds and not have a flat yield curve. that's where we're headed. they should have fixed the portfolio first. >> loan growth slightly slowing down, but not in a worrying level. >> since last summer 2016 was a good year both on the retail side and the institutional lone side. this year not so much. it slowed down the reason is regulation we have less leverage on the book customers have to have more equity in deals. if you're a home builder, you have to have 50% down now. they're not going to lend you
5:09 am
70% anymore. >> let's talk about individual stocks and your preference for them jpmorgan was the darling for so long slipped a bit last quarter has the gloss come off that one? >> they're all fully valued. there's probably the most upside on bank of america right now it is a rebalance story. it moved 40% from the election to the first quarter of this year it has been the story. citi has expectations, but there's not much there other than the credit card book, the rest of the long book is mediocre in terms of spreads half of what jpmorgan gets for a commercial line. it shows they don't have pricing power. >> wells fargo at this level, given the under-performance since the cross-selling scandal, is that an attractive buy or do they still have issues to work through? >> wells is a great performer but they've been distracted for more than a year now i worry that management cannot deliver the earnings growth
5:10 am
particularly that the street expects. you might see wells slip, but it's still a premium stock, 1.6 times book >> finally on the prospect of tax reform this is something that would significantly benefit the banks if it came >> it would help on the earnings side it won't help them generate revenue. that's a structural regulatory issue. but it would certainly help. there is deregulation going on in washington as we speak. there's a lot of aspects to regulation guidance, implementation, how they interpret the law that can change quickly and it already is. i see some rays of hope on the expense side for both banks and nonbanks going in the next year. >> your top pick was bank of america? >> i think for now in terms of the stock price, the upside potential, yes city has a lot of people hopeful. i don't think city can deliver with their current business mix no asset management, no residential mortgage business. all they have left is capital
5:11 am
markets, the payments business, and then obviously the credit card book. >> chris, great to see you >> pleasure. switching focus to tech news facebook is dispatching its coo sheryl sandberg to washington. the social media network is trying to contain the political fallout from news that russian agents used facebook to spread disinformation during last year's election. sandberg will reportedly meet with members of congress her visit comes weeks before the house and senate holds hearings with facebook and other tech companies about russia's role in the 2016 election. time inc is turning a new page landon dowdy has more. >> less is more, that's what "time" thinking, as they will second late less of "time" magazine and other core brands starting next year the publishing giant will reduce
5:12 am
weekly circulation of "time" by one-third to 2 million companies. the chief revenue officer saying there are headwinds in print and that they are trying to reimagine the way to reproduce these products in a long-term sustainable way. shares of time inc are down 27% year-to-date and unchanged in early trading. back over to you >> thank you very much. still to come on "worldwide exchange," alibaba's big bet the e-commerce giant dropped $1 billion. the details of its latest investment coming up. and catalonia pulling back from the brink a live report from spain stay tuned, you're watching "worldwide exchange" on cn bc
5:13 am
your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember.
5:14 am
5:15 am
good morning to you. welcome back to "worldwide exchange." let's give you an update on the market picture we had a bit of green for the dow, but it slipped slightly south, but this is off the back of a record all-time close for the dow yesterday and slight gains for all three markets. slight declines in the futures market european equities led higher by spain. up 1.5%. the rest, as you can see, broadly flat why is spain up? for that let's get the latest on the crisis from catalonia over the last couple of weeks the spanish government calling an urgent meeting to discuss
5:16 am
next steps to halt catalonia's moves. willem marx has the latest >> reporter: carles puigdemont was talking to the catalan assembly not far from where i was standing now he essentially paused the idea of the declaration of independence, he asked for more talks that was met by confusion from fellow catalans the spanish government said they would never accept a declaration of independence. some members of his own coalition said they saw it as a lost opportunity to not declare independence in madrid, where they mentioned they'll have a cabinet meeting this morning and a full meeting of spanish parliament, they will look at their options. mariano rajoy said he does not want to enter talks if the threat of inmredependence is one
5:17 am
table. whether rajoy might consider one of the options put forward by his own political opponents, the socialists here to consider further dialogue, potentially make future concessions to the catalans remains to be seen. >> has there been much international pressure when we consider the eu, have they gained face or lost face in this >> donald tusk yesterday, a few hours before we heard from puigdemont issued a public message saying please don't make rash decisions i understand where you're coming from i am a member of an ethnic minority i felt the force of a police baton, referring his history in poland he said dialogue is the way forward. if you want to talk about democracy, that's about talking. don't make bold decisions now that you might regret. european leaders saying they would never recognize independence declaration, but they are urging talks.
5:18 am
>> is it possible that the catalan leader now loses face himself if this is framed as a risky and potentially dangerous way to just try to slightly change the dialogue? >> look, it's clearly a delaying tactic everybody i've spoken to acknowledges that. members of his own coalition, the c.u.p., the far left, they said they were deeply disappointed and some talked about treachery in regards to his speech we will see if the spanish government wants to call talks and reduce some of his popular mandate. a lot of questions remain. >> willem, thank you very much still ahead, bill ackman takes his adp proxy fight online what he told investor observes a webcast last night
5:19 am
first the national weather forecast from bonnie schneider good morning looking at wet weather we had some storms in chicago. more rain is expected for detroit, cleveland, pittsburgh and philadelphia as a front continues to push moisture that way as well as the virginia coast. boy, temperatures are not feeling like october at all with high pressure dominating across the southeast. temperatures are soaring into the 80s and 90s in alabama and georgia. feeling like summer. it's not changing any time soon. we're expecting temperatures to stay warm through tomorrow and even into the weekend. even oklahoma city well above normal for this time of year most places will stay like that through the weekend. even indianapolis, 81 is your high on saturday and the 70s this week so enjoying warmer conditions that's a look at the business traveler's forecast. more "worldwide exchange" when we come back i love you, basement guest bathroom.
5:20 am
your privacy makes you my number 1 place to go number 2. i love you, but sometimes you stink. febreze air effects doesn't just mask, it cleans away odors. because the things you love the most can stink. and try febreze small spaces to clean away odors for up to 30 days. breathe happy with febreze. you won't see these folks they have businesses to run. they have passions to pursue. how do they avoid trips to the post office?
5:21 am mail letters, ship packages, all the services of the post office right on your computer. get a 4 week trial, plus $100 in extras including postage and a digital scale. go to and never go to the post office again. this is not a cloud. this is a tomato tracked from farm to table on a blockchain, helping keep shoppers safe. this is a financial transaction
5:22 am
secure from hacks and threats others can't see. this is a skyscraper whose elevators use iot data and ai to help thousands get to work safely and efficiently. this is not the cloud you know. this is the ibm cloud. the ibm cloud is the cloud for business. yours. ♪ ♪ welcome back to "worldwide exchange." stocks to watch today, alibaba making a $15 billion investment in research and development. the company plans to launch eight centers in china, israel, russia, singapore and the u.s. researchers will work on ai, quantum computing and fintech. shares of kobe steel falling nearly 18% in japan. a unit of the company was found to be falsifying data. kobe steel admitted it false records to show aluminum and copper products met customer
5:23 am
specifications down 18% didn't stop the nikkei crossing over the pre-asian financial crisis high, a why not seen since december 1996. shares of china's great wall motor rising 15% in hong kong. reuters reporting bmw is exploring a joint venture with the company and may open an assembly plant in eastern china. philips will suspend manufacturing some defibrillators in the u.s. following criticism from regulators the company says it will continue making others under heightened scrutiny. philips expects to take a $23 million hit to earnings as a result shares of barracuda slumping the cloud computing company's earnings matched forecast but the guidance was weak. shares of that are coming for you in a moment. in the meantime, shares of micron are under pressure. the company announcing plans for a $1 billion share offering in order to pay down debt billionaire investor bill
5:24 am
ackman taking his fight for an adp board seat to the web last night. leslie picker has the details. >> he's reaching out to the 28%, the amount of adp shareholder base made up of individual retail investors he gave a slim down after-hours presentation last night with his sleeves rolled up and he fielded questions from shareholders who wrote in from sydney to louis m louisvil louisville he said adp's hostile response is a bad sign. >> the more a company fights back to keep a major shareholder off the board, the more insular the culture, the more necessary it is to have dispraarate points of view in the boardroom so you can see change is needed here. >> the specific change he's seeking? basic blocking and tackling.
5:25 am
essentially making the company more efficient to grow earnings and the dividend ackman showed an animated video to explain how to vote specifically for his slate historically retail has been largely left out of the proxy fight equation, after what happened to nelson peltz yesterday at p&g, it's clear in the big, older activist targets retail is ever more important. >> the retail turnout yesterday, do we know how high that was yet? >> we don't know the final results. we don't know numbers, but we know preliminarily the share holders voted in favor of the 11 directors that the company put up on its slate. we don't have a sense of the breakdown. that will come out in the forthcoming days >> interesting that we saw nelson peltz frame it as a victory for himself because he got so close, but not over the line is that a fair way of framing it it was certainly close >> it is interesting a lot of these activists especially with these fights,
5:26 am
they are an uphill battle from the beginning. they look at this as a way to send a message to management so i think nelson peltz looked at the results yesterday as a reflection of the fact that there was large proportion of the shareholder base that wanted change, and the fact he had gotten that far was a victory. it was interesting because he spoke with sara yesterday, and he said they should give him a seat regardless on the board i don't think pga will do that they spent about $35 million to keep him off the board it's interesting how you frame these things >> exactly the p&g chairman and ceo rejected that in the following interview. both of these are examples where the activist investor has a sizable stake, it's not just percent or two. mr. ackman has a reasonable voice. >> an toactual share ownership,
5:27 am
ackman has about 2%. the rest are out of options, money call options so a lot of people on the adp side say he's not even able to vote his shares, or the entire 8.3% economic ownership that he has is it he believe in this cause to begin with? >> after three out of ten board seats, that's a large percentage of board exposure. thank you very much for joining us still to come, the top stories and a round up of the global market picture. canada's prime minister returns to washington as nafta talks heat up. we'll discuss that when "worldwide exchange" returns [vo] when it comes to investing,
5:28 am
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.
5:29 am
5:30 am
stocks rising to record levels as we head into earnings season the future of nafta, high stake trade talks top the washington agenda. and taco bell is thinking way outside the bun. why the fast food chain is making a run at the runway it's wednesday, october 11, 2017, you're watching "worldwide exchange" on cnbc. ♪ good morning very warm welcome to "worldwide exchange" on cnbc. i'm wilfred frost. sara eisen is off today. let's get straight to the global market picture
5:31 am
another record close for the dow yesterday. it broke a two-day losing streak we did get gains for all three indices, only slight 0.3% for the dow 0.2 for the s&p. nasdaq slightly higher, 0.1% we had a bit of green on the screen earlier for the dow, but we slipped below fair value. only slight declines this morning. treasury board this morning, we have seen yields slip a bit over the last week. 2.37, 2.38 on the ten-year, now 2.345. fed minutes will be in focus today. we'll talk about that. asian equities for you, we did see slight gains for shanghai and japan, up 0.7% that was enough to take the nikkei above its preas-asia financial crisis high 21-year high taken a long time to get there, but since december 1996 it has not been higher. well done to the nikkei. european trade has been led higher by the spanish market
5:32 am
which we can see if we step back and look at the map. madrid up by 1.3%. that's after the catalan leader stepped back his calls for independence, says he is open to dialogue, allowing that slight rally there. otherwise essentially flat in the european markets oil prices enjoyed a 2.7 jump yesterday. nicely back above not just $50, but 51 51.3 for wti dollar board did slip yesterday. almost a half percent. slipping a bit today the pound is down. so the dollar holding on to some gains against the british pound. gold prices which gained yesterday in the face of the softer dollar, today flat. 1,it 1,292. the fed will be in focus minutes from the fomc meeting last month are due out at 2:00 p.m. we will hear from charles evans, bill dudley and san francisco
5:33 am
fed president john williams. let's talk more about the fed. joining us is peter spiegel news editor from "the financial times. good morning what's the key things to watch out for in the minutes in terms of the details about reduction or more focus on the timeline of the next rate hike >> the most important thing is inflation, inflation, inflation. the debate about what to do over there is no inflation. the last meeting the market reacted positively, they saw the hawkishness there. the dollar has been rallying since the meeting, particularly in regards to the euro, we're getting a more dovish view from draghi the question is what is the debate about inflation we have seen asset prices go through the roof hit new highs in the market. the gdp numbers are positive the underlying economy is growing.
5:34 am
there is no inflation anywhere everybody has been forced to downgrade expectations the debate about should we be watching these strange lack of inflation and lack of wage growth, should we be watching asset prices and gdp numbers that's what everyone is looking for. if we can get a clear sense in our mind about what the fed is paying close attention to t will give us a sign of how aggressive they will be on whether they raise rates or unwinding qe. >> i suppose it's a good point to bring up what the ecb is most likely to do next. they also lack inflation but inflation is the only mandate for the ecb. i suppose it's all kind of a reminder that they're a long way from the same sort of moves that the fed has been doing even though the euro did rally for much of the year >> yeah. to me, this is the key thing for the 4 x market we have seen moves in dollar euro and dollar pound because the bank of england serving
5:35 am
hawkish as of late what was happening in the ecb, we have been seeing a fast unwinding of qe what we've heard in the lead up, it won't be that fast, it could be extended because there is no inflation and they don't have a dual mandate of looking at employment just pure play inflation there just has been no inflation. every central bank is unable to explain why this is. they can't figure out why the economy is beginning to pick up, and the labor market is picking up, we have tight labor market in europe and the u.s., yet no wage increases and no price increases that debate, how it plays out in europe and the u.s. will drive central bank policy in all three big central banks, including the bank of england over the next quarter and into next year. >> quick comment on catalonia. should the issues there have been hurting the euro's value more than it has
5:36 am
>> yes and no. we've seen spanish asset prices have been hit, but a more broad hit to the euro. it's not spain itself that is going to be hit by this. catalonia, if it follows through with independence, it is not actually -- catalonia is not a member of the eurozone it will fall out you will find gdp loss from spain. it's not like greece where an entire country is falling out and you have a return to the dr dracma so it won't hit the euro, but you will see it regionalize. specific companies and things exposed to the catalan economy getting hit. it is not a eurozone wide systemic problem >> peter, great to see you peter spiegel of the financial times. we just spoke about the fed. we have a big interview coming your way tomorrow. steve liesman will be sitting down with boston fed president
5:37 am
eric rosengren be sure to catch that interview tomorrow at 4:00 p.m. eastern. turning to washington, trade deals will be front and center today as round four of nafta negotiations get underway. kayla tausche is live in d.c. with the latest. good morning >> good morning. round four is shaping up to be the most contentious round yet the u.s. with the home field advantage is planning to table proposals that could imperil the talks with mexico and canada and frustrate u.s. businesses and lawmakers. among the demands, one that 85% of cars and truck pars come from the three nafta countries in order to be exempt from tariffs, that's an increase from the current rule of 62.5%. in a new development the u.s. wants 50% of that content to come from the u.s. alone the head of the u.s. chamber of commerce said yesterday in a speech in mexico we reached a critical moment. the chamber has had no choice but to ring the alarm bells. let me be forceful and direct,
5:38 am
there's several poison pill proposals still on the table that could doom the entire deal. donahue listed a half dozen deal breakers, auto content being one and a sunset provision that would see the deal expire in five years unless all three countries unanimously reback it. canada's prime minister justin trudeau will visit the white house, his second visit since trump took office in february, as well as a key trade committee in washington to defend nafta. trudeau made a plea by phone this spring when trump was considering withdrawing altogether a trade deal is top of mind for the president. he mentioned it yesterday in a photo-op with the pittsburgh penguins hockey team, specifically calling out its part owner and billionaire ron burkle >> ron, how about nexting some of our horrible trade deals they have made? i wanted to get him. oh, i would love to have ron
5:39 am
burkle it's great to have you, ron. i mean that, if you want to get involved in negotiating nafta, i like it. we're renegotiating nafta, ron >> all jokes aside, an adviser to the mexican embassy said on friday the risks of the u.s. withdrawing from the deal remain high analysts increasingly say this could be the round that these discussions come to a head >> we look forward to the latest on that. mr. trudeau also visiting the white house. what else is on president trump's agenda more tax reform? >> there will be a big speech today on tax reform. the president will be heading to pennsylvania he will be accompanied by congressman bar let ta from tle. the senator of pennsylvania will not accompany him. he will be expected to talk up all the facets of the tax plan the president was in nevada and california yesterday talking about tax reform and some disasters in our country, the
5:40 am
california fires as well as the shooting in vegas. tax reform continues to be a drum beat that the administration is pushing. we'll see how that pennsylvania speech today is received >> kayla, thank you very much. in other political news, the white house says president trump has asked congress for nearly $5 billion in loans to help puerto rico in the aftermath of hurricane maria. an administration official says the loan would include a 1$150 millionadvance to help with payroll and pensions but this money would not pay down puerto rico's debt. the white house and congress have so far focused funding efforts on immediate disaster relief the house is expected to consider a request this week for an additional $13 billion in funds for victims in texas, florida and puerto rico. the supreme court tossing out a challenge to president trump's travel ban the high court dismissed the case saying it involved an older version of the ban that has expired. a second case challenging the travel ban remains on the
5:41 am
docket. top trending stories, landon joins me with all of these everyone is buzzing about what >> first up, dow jones sending readers haywire. the news wire falsely reported yesterday that google was planning to buy apple for $9 billion. that was followed up with more wires that read google says yshg ea google gets 9 apple shares for each google share. google will take over apple's headquarters dow jones apologized saying the wires were sent out in a technical error. >> i love this story i'mglad i wasn't on air as it flashed up on the wires. if you reported that, which you sometimes do when you see stuff on the wires, thankfully people -- >> would be quite the steal. $9 billion >> would be worth us borrowing everything we could. >> i'm with you. jennifer lopez reportedly putting her extravagant $27 million manhattan penthouse on the market
5:42 am
the apartment has four bedrooms, a master suite with two master baths and four terraces over two floors the news comes a month after the "new york post" page six that she and boyfriend alex rodriguez were apartment hunting in new york >> why not just stay there that looks nice. >> that's what i thought 6500 square feet don't know if you saw the wine cellar >> i didn't. like the sound of it >> looking on park avenue. he just retired. he has some cash >> i'm sure they'll find a nice place. it's trying to be a one-stop shot the social media platform adding restaurant reviews, restaurant bookings and ride hailing functioning into snap stories. four square, uber, lyft and some other companies teamed up with snap on the new feature. this gives you more options than just your selfies. i know you cut back a little
5:43 am
>> i have. either way, i don't use snapchat anymore. >> you use instagram >> good follower there >> we still get the selfies. this is huge, it's showing investor confidence that this is evan spiegel's ability to innovate, go beyond selfies and compete with instagram >> we'll have to see if it works. on snap, will you be wanting to go for restaurant reviews straight away? >> if it's a one-stop shop, easier the better. taco bell and forever 21 ar teaming up for an unlightly partnership. they're launching a brand of taco themed clothing including hood hoodies, graphic tees and jackets. it will be available starting today at forever 2 1 stores across the country >> interesting link up i have never been to a taco bell >> you haven't been to taco bell have you been to forever 21?
5:44 am
>> i don't think so. the only time i ate it was on the "squawk box" set when the ceo was in to discuss it >> kfc did this, it was new jerseyly su hugely successful >> thank you very much for that. moving on to sports. the united states won't be playing in the world cup next year the americans were eliminated in the final qualifying match last night. the men's national team lost to trinidad and tobago 2-1. the u.s. only needed a tie to qualify. it's the first time the u.s. will miss the competition since 1986 i'm afraid to say, it's very disappointing not to qualify from that group. also means that this great nation won't be as interested in what is the greatest sporting event in the word in russia next summer that's a disappointment. futures pointing to a lower open on wall street as the fed and earnings come in focus
5:45 am
we're set up for the trading day ahead when "worldwide exchange" comes ckba ick it? ♪ ♪ yes you can ♪ well i'm gone i just saved thousands in less than a minute, i found out how much home i can afford. i like how you shop for loans the same way you shop for flights online. i didn't realize at lendingtree you can save money on almost any sort of loan. i consolidated my credit card debt with a personal loan. i found a new credit card with 0% interest for 15 months. you just shop, compare, and save. and it's all free. go to lendingtree right now and start saving.
5:46 am
5:47 am
theseare heading back home.y oil thanks to dawn, rescue workers only trust dawn, because it's tough on grease yet gentle. i am home, i am home, i am home welcome back to "worldwide exchange." let's get you up to speed on the market action around the world the nikkei closing today at a 21-year high best close since december 1996
5:48 am
it's taken this long to cross the pre-1997 financial crisis highs. the nikkei up about 9% year-to-date up about 0.3% today. very nice gains for it there the other international story this morning is the spanish market is up nicely as pressures in catalonia have eased. we're approaching the top of the hour the team is getting ready for "squawk box. becky joins me good morning >> good morning. how are you? >> i nearly said joins us, it's just me. >> i get to join you it's the two of us together. let's talk about what we would normally talk about under situations like that, probably earnings getting underway. you know what a big week this is for the banks, the financials. you know that blackrock is coming up at 6:15 eastern today. they'll release earnings at 6:30, just after that we'll sit down with larry fink, the ceo of the company that has 5$57 trillion in assets under management to talk about not
5:49 am
only what happened with the quarter, what he sees happening with markets, what's going on with etfs and then talking politics and taxes also when you mention taxes, you start thinking about what the administration's plan is we'll hear more about that today with kevin hassett, long-time squawk guest from aei, now the cea chairman we will talk about what we can expect to see from the administration about these things earnings on a roll just beginning with the banks we hear from this week. delta air lines is also out this morning. edward bastian will talk about his numbers when they hit at the top of the 7:00 hour a lot of issues today. that's just a few things we'll be discussing. you've been watching the financials, what do you expect from the companies this earnings season. >> i think the guidance has been tough. it's a tough quarter compared to last year. this is more for the banks than asset managers tough comps compared to the same
5:50 am
quarter last year. they guided down 20% on trading. that has been well elegraphed. the bank stocks pulled back in the middle quarter i would say low expectations but hard to beat them significant limit. >> it's a bit of a different story for blackrock. they missed earnings expectations in the second quarter and analysts have been ramping up their numbers i think you're right one story for the banks -- >> is is he talking about soccer >> he did not. joe wants to know if you talked about soccer >> he did earlier this morning, but not now. >> i'm gutted for you guys >> here he comes look out you're too close to the camera you can't see it's you back up this way >> can you believe that? >> i can't believe it? first time since 1986. >> you guys are in stereo in my ears >> you want to borrow the microphone no >> i wanted to you qualify
5:51 am
it might have made some people like yourself more interested in the world cup which is the greatest competition on earth. >> wilf said he wanted us to qualify. he's not listening he wanted to us qualify because it might make people like you more interested in soccer. >> it's hard to be interested now. >> exactly >> he is paying attention though >> instead, becky, can you ask joe if he will now support england in the world cup >> he wants to know if you will support england in the world cup. >> yes >> you got a deal out of him >> wilf, run away, take this and go >> i'll buy him a shirt and everything thank you very much. we'll see you in about eight minutes time still to come, our next guest says we're in a buy every single dip environment what he means and ere whhe sees those opportunities straight ahead. for your heart...
5:52 am
your joints... 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 in drug stores nationwide. prevagen. the name to remember.
5:53 am
exchange." i'm wilfred frost. futures just slightly lower. and yesterday they closed just slightly higher.
5:54 am
about 0.3% higher for the dow, a record close again 47th i believe of the year s&p was up 0.2%. the nasdaq 0.1%, pointing lower by similar amounts this morning. michael purves joins me. buy every dip environment was the headline at the tease. this is still an attractive moment >> it certainly is you have a couple of big factors here, which are sort of converging and colliding and keeping this risk appetite on. i think we talked about this in the past, they're as strong now today as they were earlier this year we have global synchronized growth combined with constructive, aggressive monetary policy. by key central banks around the world. it's a global goldilocks condition. i think this doesn't mean the best risk return is in the united states, i would be surprised if the u.s. dips or
5:55 am
continues to be bought even if the earnings season does not pan out to be quite as great as expected >> what would make you change your view on that? negative earnings or less impressive earnings? >> the big picture, do you see signs of a big recession coming at some point in the next 12, 18 months i don't see that if you see economic data weaken. then the other thing is there a big change in monetary policy from the fed or the ecb or the boj? it's important to recognize that the boj and the ecb right now are adding more stimulus than we did at the peak of qe3 if i'm focused on mario draghi if he announced a more aggressive taper in the market that will spill over into treasury yields here therefore that whole risk paradigm we're seeing played out in the record low vix, the very strong u.s. equity market bleed
5:56 am
up here, that regime will transition >> earnings season kicking off in earnest today later this week. what sector is your preference >> i think you might have been referencing financials just a few minutes ago. financial also be interesting. they have been signaling certainly the weak side of the businesses they have -- the rate environment is not where it should be either on the curve basis or on the absolute level of yields. i'm going to guess the financials come in stronger here i'm a little bit more concerned on the small caps. small caps have more exposure to the u.s. economy and are going to be a trickier trade after this rally we've seen over the last few weeks one thing i would point out, pretty much every major economy this year, if you look at consensus growth forecasts, every major economy has had a meaningful upgrade in their growth forecast except for the
5:57 am
united states. >> all right we have to leave it there. thank you very much for joining us michael purves of weeden and company. that's it for "worldwide exchange." "squawk box" is next g, 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.
5:58 am
5:59 am
good morning president trump set to give a speech on taxes. details straight ahead. breaking news, the death poll rises in northern california a string of deadly wildfires continues to tear through the heart of wine country. blackrock set to report this hour we'll bring you an exclusive interview with ceo larry fink. it's wednesday, october 11, 2017 "squawk box" begins right now. live from new york where business never sleeps, this is "squawk box.
6:00 am
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 joe kernen and andrew ross sorkin. it's time for the global markets report check out the u.s. futures things are flat. but this comes just after the dow set a new record level yesterday. you can check it out right now the s&p futures are down by just under 2 points. dow futures barely positive. the nasdaq down by 5 points. in asia, the nikkei closed at another high the highest level we've seen in about 21 years up 57 points after making those gains the day before now sitting at 20,881. hang seng was down by a third of a percentage point the shanghai was up by just under 0.2% in europe, you'll see that in the early trading that's already underway, things are mixed the dax is


info Stream Only

Uploaded by TV Archive on