tv Worldwide Exchange CNBC October 24, 2017 5:00am-6:00am EDT
market alert global stocks are edging higher after the dow snapped a six-session winning streak yesterday. new this morning, china does something it hasn't done in modern times. and our news maker of the hour blackstone chairman steve schwarzman will join us live from saudi arabia. it's tuesday, october 24, 2017 "worldwide exchange" begins now. a very good morning.
a warm welcome to you. this is "worldwide exchange" on cnbc i'm wilfred frost. sa sara is off today. let's get to the global market picture. losses yesterday the dow was down 0.2%. the s&p down 0.4 the nasdaq the laggard down about 0.6% it was a broad selloff 10 out of 11 sectors were down te telecos were the worst sector. but we had had six straight gains for the dow and s&p, and decent gains last week for all three indices. this morning we're pointing higher just under a tenth of a percent for the nasdaq and s&p the dow up 0.2% this morning we saw yields get close to 2.4% the back end of last week, but we slipped back a bit. rising a fraction. still not above 2.4, but 2.39% you can see that pick up in yields we've seen over the course of october.
let's look at asian equities japan was the stand out performer yesterday after shinzo abe's resounding election victory. today up about a half percent. hong kong down 0.5%. shanghai slightly higher an update from china on the latest out of the communist party congress, which is ongoing as we speak. european markets for you which had slight gains yesterday, seeing for the most part slight gains today. we did have pmis coming out, october pmis, which for the most part were strong the services number just behind expect expectations, manufacturing ahead of expectations. very much pointing to expansion across the eurozone. let's look at broader markets. oil prices, which saw slight gains yesterday, they are seeing slight losses today. those slight losses just exaggerated in the last half hour or so so we now do have over a half percent of declines for wti, at
51.6 looking at the dollar, not too much happening today on the dollar we got slight gains yesterday, 15 basis points high r for the dollar index today slight gains for the dollar against the yen losses against the euro. the kiwi/dollar did hit a five-month low affleck of detail from the incoming labor prime minister gold prices, we did see pretty much flat yesterday and pretty much flat today. gold price at 1279 the wall street agenda earnings are front and center. five dow components will report, 3m, caterpillar, mcdonalds, united technology and at&t eli lilly, fiat chrysler, lockheed martin and chipotle among the top corporate headlines. reports of major changes at under armour and landon dowdy has the details for us reports say under armour
chief executive kevin plank's first partner, kip falks will take a sabbatical from the company. the apparel maker is also said to be exploring the exit of tennis and other outdoor categories as it struggles to grow in an increasingly difficult sports wear market fulks has changed roles numerous time, most recently strategic adviser after working on product marketing sourcing and operations fulks began his sabbatical earlier this month this is a benefit to all flee pl employees with ten years of service. stocks on under armour dropping on the news. this stock is down 40% year to date the stock is up 0.2% in early trading. we're watching shares of general electric this morning. the stock coming off its biggest
one-day drop in six years. analysts say they're worried ge may have to cut its dividend,. it fell 6% yesterday you can see the tough time it had. it did fall sharply on friday but recovered before the end of trade. the fall yesterday cementing by the close. whirlpool's third quarter results missed forecasts they cite higher costs for raw materials. sears will stop selling whirlpool brands including may tag and kitchen aid due to a pricing dispute. they will sell the remaining inventory in the stores and has stopped listing products on its website. hess is selling its oil and gas assets in norway for $2 billion. they will start the process to sell interests in denmark. the move is expected to reduce hess' debt by 5$500 million the ceo of tenet healthcare
is leaving the company five months earlier than expected this comes amid pushback over the hospital operator's strategy the chairman will assume the ceo role as the company search force a replacement. hasbro's ceo says the toys "r" us bankruptcy won't stop the company from selling its toys there. >> we didn't know it was going to happen. and obviously when you first hear about this, you take a few days off, we wanted to understand what the impact might be it has taken us a month to get a plan together and a new agreement with them. we wanted to be clear that we are making a new plan with them. we are shipping to them. they're partnering with us we are partnering with them. we had to relook at our plan for the rest of the year given how close we are to the holidays and how important these months are to the business. >> disappointing back drop there
from the hasbro ceo. i would have liked to see more toys hasbro shares got hit hard yesterday on the company's muted guidance for holiday sales related to the toys "r" us bankruptcy filing. and they fell. but today in the premarket down about 0.3% still to come on "worldwide exchange." an ecb meeting draws near brexit talks pick up steam and china's 19th party congress comes to a close. ft's peter spiegel joins us for a round up of the global headlines before we go to break, let's check in on european markets. slight gains for france and germany off the bank of strong eurozone pmis. the ftse 100 slightly lower. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets
no one else lets you do that. see how much you can save. choose by the gig or unlimited. xfinity mobile. a new kind of network designed to save you money. call, visit or go to xfinitymobile.com. good morning welcome back to "worldwide exchange." let's get you up to speed on the market action. u.s. equity futures are pointing higher today after declines yesterday. the dow down 0.2%, the s&p down 0.4% the s&p down 0.6%. 10 out of 11 sectors were downed yesterday. utilities were the only ones slightly positive. we have had five or six straight gains for the s&p and dow. we are looking at gains this morning. 53 points to be precise on the dow. a quick look at oil prices, which saw fractional gains yesterday and have just softened in the last half hour or so.
down a half percent for wti. currency board the dollar had slight gains yesterday. the dollar slightly higher against the yen. weaker against the euro. the pound is pretty much flat. shares of commerzbank are trading higher in europe the ft reports that the bank hired advisers to analyze potential m&a scenarios. the ft has been front and center it's up 3.6% on this reporting potential candidates being touted like unicredit in italy and pnb paribas in france. it has had a great run this year stock price up 63% novartis reported third quarter profit beat forecast on strong growth for its cancer drug and eye care business in alcon. novartis' ceo said novartis made progress on alcon for a possible spinoff in 2019.
wefrnlgt will look >> we will look at the strength of the market f we do exit, we want to exit at a time when the market is strong the market is strong and we expect that to continue. in the near-term we're focused on ensuring that alcon continues to grow sales, operating income and margin in a way that creates a sustainable business, that if it did come to market it will really be in demand. >> jimenez says he is considering a separate listing for alcon. u.s. tax reform would come into play on where the shares do get listed logitech's second quarter results beat forecast. the company is backing its outlook for sales growth of 10% to 12% they are upbeat about the current quart cher is ter which traditionally the biggest of the
year. toshiba is considering various measures if it can't sell its memory chip share by march. it's up 0.3% in japanese trade this morning. brexit taking center stage once again tensions rising overseas as the countdown to the end of the year summit begins. the final discussions on that. let's talk to peter spiegel, news editor of "the financial times. great to see you as always >> good morning. good to be here. >> i will start away from brexit for once and touch on asia president xi being labeled as china's most powerful leader since mao. i wonder whether we should apply a similar label with japan and shinzo abe's victory over the weekend. how powerful is he now in japan? >> was a bit of a surprise when the elections were called,
we expected them to lose a few seats. then we saw his rival in tokyo, koike, sort of form her own party and win over some opposition we thought he was in real trouble which from an economic point of view rattled the markets. we have seen abenomics in play for several years. we weren't sure if that would continue clearly now with his man dade, with the two-thirds majority in the diet, he will be able to push this through. we are waiting for the big third arrow, proper reform -- structural reform in the japanese economy with the two-thirds majority we may see that a lot of analysts i talk to on this, they have always been skeptical that he will be able to follow through on the third arrow or whether he was palatable to do it he has the two thirds majority now. if he wanted to, he could push it through he wants to change the japanese constitution to make it more weakened, but on economics we
will watch that closely. >> that constitutional reform he's talked about to make things slightly less passivist, is that a big swing factor for relations with north korea what will china be thinking as it relates to that >> it is it's a big deal also for the u.s. they wanted japan to take more central role in its own defense for many years now but as you say, it is likely seen by the chinese in particular as somewhat unsettling there's been a lot of despite between the abe government and xi jinping over disputed islands north of japan so it does raise tensions there. the u.s. argued that having an ally more sort of responsible for defense of the region will help stabilize the region in many senses because the u.s. has wanted to maintain its presence there. it sees itself as a stabilizing factor we are in a region that is the hottest of the hot points in the
world. abe did run on this issue because he felt the north korea threat would mobilize voters, and it worked. because he was able to rally his base around that issue >> let's switch focus back to europe and to brexit in particular i noted that donald tusk tweeted something yesterday along the lines of it's in the uk's -- the ball is in the uk's court to decide on whether there's a trade deal no deal or no brexit. i'm particularly interested that the final option was included in the tweet. are people genuinely considering the option of brexit being overturned at this stage. >> certainly not here in london. this is something tusk said again this morning at the european parliament. but there is this back and forth now going on between london and brussels over who has to move first. you used that classic phrase now, whose court is the ball in. it seems to be every day the ball is somewhere else
may went to the parliament yesterday and said we're waiting for the europeans to decide what they want the bilateral issue to look like. now we have tusk saying, no, it's not up to us, it's up to you. you can decide whatever you want no brexit, hard brexit, deal or no deal. he's trying to ratchet up the pressure on may and the government to get their act together we reported that may has not had a debate within her own cabinet or what they want the post relationship to look like. and this is sort of angered many and left brussels agog they don't understand why the british side still to this date has not got its ducks in order so you're seeing brussels slowly turning up the heat on may to try to get her to move and move quickly on the brexit bill, on the situation in ireland once they get those current divorce proceedings done, then they can move to the trade deal, to the transition deal
brussels wants to get that done within the next two months, may wants to put those discussions off until she can get the discussions up on the trade deal it's a big dance at this point what do you expect from the ecb this week? this is the most anticipated meeting in some time we will see draghi put a timetable to the unwinding of qe we've been waiting for this since he started will he go fast, over six months, 12 months, 18 months how much will they start tapering we've seen the euro be the strongest currency in the 4 x market because draghi has signaled they may raise rates. the fed is more squishy on this. trump may think about appointing john taylor, a much more dovish chair that could come this week.
we'll see how hard draghi about be in the thursday meeting it's one of the most an tess pated ecb meetings or even a central bank meeting we've had in some time >> peter, thank you very much. people in london paying attention to you because the ftse 100 turned positive whilst you were speaking. that's the effect you can have >> that was not my doing still to come on "worldwide exchange," china's communist party enshrined xi jinping's political thought into its constitution today we'll tell you how important atth is when "worldwide exchange" returns.
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welcome back to "worldwide exchange." the chinese congress party wrapped up today xi jinping status has been named one of the most influential leaders. eunice yoon has the details. good morning good morning well, the delegates today managed to accomplish two things first of all, they changed the party constitution so that it includes president xi jinping's name it's a bit of a mouthful, but significant in terms of the language xi jinping's thought on socialism with chinese characteristics for a new era. the language is important and the use of the word thought is significant because the only other leader who had their name enshrined in the constitution
with the word thought is the founder of the chinese government, chairman mao zedong. that means the party elevates president xi to the same level addre as chairman mao zedong and they also voted in the central committee, a powerful body this central committee on wednesday will hold their first session and then decide who is going to be leading the country for the next five years. the top people are five to seven names, and xi jinping will be at the helm the number two is likely going to be the premiere but the other five names are up for grabs. what this tells us, the change in the party constitution, is that president xi is likely going to dominate that new lineup that they're all going to be xi jinping loyalists. and for investors, that just means xi jinping is going to
have a tighter grip on policymaking and including when it comes to the economy. >> you said five to seven names. i remember this time five years ago there were only seven on the standing committee that was a surprise. it was shrunk from nine, and that increased the relative power of president xi on it. so it could be as small as five this time? >> that's right. there's been speculation traditionally it's been seven. but there was speculation that it could be shrunk to five so that president xi could consol da consolidate his power. there are five other names that are named as possible candidate. so, again, most of those people are very, very close to president xi >> we all can wonder whether president xi will try in five years time and go for a third term which would be unprecedented. and with links to that, people are saying if he doesn't name young people to the standing committee that would be a sign
that he wants to hold on for another term later >> right there's a list of candidates going around people have been looking at it there were two names of men in their 50s. so they would be young enough to seventy-two terve two terms. what has traditionally happened in china, when jintao came into power, he introduced xi jinping. he had already named xi jinping and we already heard about him people were look at that and seeing xi jinping was going to be the next in line. this time xi jinping has not chosen anybody, that's the speculation that he won't include anybody in their 50s again, this could be -- the speculation is that he could be doing this so he's not perceived as a lame duck president, that he doesn't want to have a name
out there that everyone will be focused on >> great stuff we look forward to that unveiling on stage tomorrow morning your time to see who is on that standing committee alongside the increasingly powerful president xi jinping. in washington, president trump will make his first trip to capitol hill to meet with lawmakers. past gatherings all took place at the white house tracie potts joins us with a look at what we should expect. good morning >> expect the president to join senate republicans for their policy luncheon today and to talk about tax reform. it's a big priority on both sides. there's a lot we don't know. one idea being floated around is severely dropping the amount of contributions that can be made tax-free to 401(k)s from 18,000 to around 2400 the middle class could take a big hit if that happens. president trump is tweeting that it won't that 401(k)s won't be
touched. but there's talk about that on the hill that's likely to come up today along with other details that still have to be filled in the senate paved the way, they approved a budget that has a 5 $1.5 trillion allowance for the big tax cuts that the president wants to do. the house still has to approve that budget. but again the big question today may be what happens with those retirement accounts with 401(k)s. wall street not happy with this idea that contributions might be limited. >> tracie potts, thank you very much for that. president trump's tweet yesterday saying -- suggesting it wouldn't be limited we'll see what the details are still to come, the top stories and a round up of the global market action s [bell rings] o and one insurer is offering a $25 apple watch. there's one catch.
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japanese stocks close higher for a 16th straight day. inside saudi aramco. a sbs as soon a cnbc exclusive with the company's ceo. and the top trending stories including snapchat having a tough time making its spectacles disappear. it's tuesday, october 24, 2017, you're watching "worldwide exchange" on cnbc. ♪ good morning welcome back to "worldwide
exchange" on cnbc. i'm wilfred frost. sara is off today. let's look at the global market picture. futures are pointing higher. nicely so. about 50 points for the dow. comes off declines yesterday the dow was down about 0.2%. nasdaq down 0.6. s&p somewhere in between 10 out of 1 sectors were lower utilities fractionally positive. we had six days in a row of gains for the dow and s&p and decent gains last week as a whole. today we're bouncing back either way. 47 points for the dow. let's look at the ten-year treasury note. we're getting closer to the 2.4% level. we came away today moving back higher again in terms of yields, 2.395 as i said earlier, a nice trend of rising yields that we have seen over the course of the last three, four weeks. asian equities for you japan higher after shinzo abe's
election results, a 16th straight day of gains for the nikkei that's a record. it's up again today. half a percent as we just said hong kong slightly lower shanghai up 0.2% europe had good pmi data services were behind expectations but above 50. either way, europe in expansion territory. we look to the ecb meeting this thursday markets today essentially flat slight gains for france. broader markets, oil prices yesterday did gain fractionally, but not too significantly. they are down a bit today. 51.6 the price of wti. if we look at the dollar, not doing much today showing slight gains against the yen, slight losses against the euro and slight gains against the pound.
gold prices flat yesterday and a bit flat today, 1279. on to the wall street agenda earnings are front and center. five dow components will report, 3m, caterpillar, mcdonalds, united technology and at&t other companies also out with results includ eli lilly, fiat chrysler, lockheed martin and chipotle joining us now to discuss all the factors is gina sanchez. good morning to you. thanks for joining us. >> thank you >> earnings season continues at pace but the earnings growth we're seeing this quarter state side not quite as pronounced as the last two quarters. what's your take on the score card so far? >> we've been in catch up mode for the first two quarters i think a lot of people started to extrapolate that catch up mode into extraordinary numbers. not surprisingly the second half is always more disappointing than expectations. i do believe we'll have to start taking a pencil to the final
numbers and next year's numbers starting next quarter. so this is not that surprising to us. however i think market participants priced in too much. >> sectors preference in the u.s., where do you like that at the moment vrnlg >> the biggest concern we have generally is a broader concern valuations are too high. if you look at -- if you sort of think about the sectors most vulnerable to that valuation story, it's growth sectors like technology we actually believe it or not we like the energy space because oil continues to finally show signs that it is going to get back to a more normal level. not surprisingly right around the time of saudi aramco's ipo what about the picture many europe we had manufacturing pmi at
58.6 services at 54.9 significant expansion taking place. is that priced in yet in european markets >> some of it is priced in we think the european story is far more self sustainable than the u.s. story it has come on slowly. revisions in europe have been slower to come and they're still being revised up the general analyst community has, i think, been very conservative so i do actually think there's more to come out of the european markets. >> finally, a picture on asia. you -- this run in the nikkei, 16 straight days sounds extraordinary. does the re-election of shinzo abe give that a leg from here. >> clearly it has. the expectation is that this opens the door for continued ee easing at a time when the rest of the globe is pulling back the u.s. already laid out a plan
for tapering the ecb will lay out a plan for tapering the uk could raise rates we're looking at a rest of the g 4 thg4 that is tightening when n will be easing >> gina sanchez, thank you very much for that. i said earlier 16 winning streaks. that's the new record, it was a 14-day previous record streak set in the 1960s sfwlooch shares of commerzbank are trading higher in europe the ft reports that the bank hired advisers to analyze potential m&a scenarios. it is up 4%. it gained on possible talk of this possible takeover fascinating story. potential suitors are the named
like bnp paribas. microsoft will drop a lawsuit against the u.s. government after the justice department changed rules over data requests. microsoft filed the lawsuit last year t claimed the u.s. government was violating the constitution from preventing the company from alerting users about the requests for information. underarm ser reportedl armog the exit o tennis and other outdoor categories as it struggles to grow in an increasingly difficult sports wear market also kevin plank's first partner, kip fulks will take a sabbatical from the company. time for our top trending stories. landon joins me. >> amazon has received 238
proposal force i >> amazon has received 238 proposal force i for its second headquarters cities are vying to host the second home base the online retailer says it will invest more than $5 billion and create up to 50,000 jobs for its hq2. >> amazing number of proposals i know amazon is a hot company, hot stock. >> it's a front page read. even towns, a suburb in atlanta is offering to name its city amazon it's a big win for whatever city gets it. >> that's a proposal that would woo me >> if they named it wilf >> i don't have 50,000 jobs sadly. >> you have to work on that one. >> maybe no job if you give up your name. this is a good one taco bell is thinking way outside the bun. >> nice. >> the chain is testing a chocoladilla, it's a quesadilla filled with melted kit kat bars instead of cheese. it's available in wisconsin.
>> i don't know about the pix chore. i like chocolate and mexican food >> i was thinking you had influence on this. they first tried it in the uk. i know you go back frequently. apparently it worked >> didn't know we had taco bell in the uk. >> i have no idea this is your home >> i have not seen it. >> it's fun to say, chocoladilla >> you said it with a british accent >> you're rubbing off. onhancock is offering some policy holders an apple watch series 3 for 25 bucks. the catch is users have to remain active and earn vitality points >> i like that if it pushes people to do more exercise the problem is do you have to cough up the full price if you have a lazy week >> it encourages you to exercise it saves you a lot if you are giving up a lot of your health data which is the scary point there. snapchat is having a tough
time making its spectacles disappear. the company has hundreds of thousands of pairs of its spectacles sitting in chinese warehouses this comes after ceo evan spiegel boasted that sales of the sunglasses topped 150,000. >> the big point when he boasted that, were that the 150,000 sold quicker than the iphone sold it grabbed headlines but if it slowed off quickly, it's not the case. >> i think that's the thing. the initial demand was reat. they got excited now huge inventory left over >> maybe a little christmas present. kendall jenner is coughing up $9 million for charlie sheen's former home. it has nine bedrooms, six bathrooms a chef's kitchen, breakfast bar and movie theater. >> a chef's kitchen? who else would the kitchen be for in. >> you don't cook? >> i don't know if we saw it
it's a huge kitchen. massive. beautiful. >> is that what you mean by chef's kitchen bigger than normal >> it has all the tie tech i'm not a chef >> i don't think you need to put the word chef in front of it. >> she's been investing in real estate here. she bought emily blunt's house she flipped that >> you know about what kendall is up to >> you don't she's a model, you're all into that. >> ouch. landon, enough for one day thank you very much. we'll see you tomorrow >> thanks. on to sports, the philadelphia eagles dominated the washington redskins last night. the eagles benefitting from four touchdown passes by carson wentz. the eagles won 34-24 for their fifth straight record. their record is 6-1 on the season congrats to "mad money's" jim cramer i'm sure he was watching still to come, the must reads, plus inside saudi aram
kocharamco oil prices this morning moving lower -- wow, they jumped back $52 the price of wti >> if you look at our assets under management today, it's all in conventional investments. and we don't want to be like a sitting duck waiting to be, you know, shot down or by only being in the conventional investments. we want to go beyond that's what vision 2013 is all about. go to the furetu, try to take command of the future. hi, i'm the internet! you know what's difficult?
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good morning welcome back to "worldwide exchange." i'm wilfred frost. time for our must-read stories or my must-read stories. my pick is from the "new york times. by andrew ross sorkin who is out in riyadh leading some amazing coverage out there in the saudi desert, world's business leaders follow the money. it's a detailed look at some of the stuff he's seen and experienced on the ground, this big push from saudi arabia to diversify the economy. the line of many that stood out to me. there are continuing questions about whether the kingdom's investments in new industries and businesses will be able to produce the kind of returns that oil has for generations here
the question for me, having been to riyadh five or six times in my life, is this diversification coming way too late. if you look at the likes of dubai far ahead thof them, will saudi arabia be able to generate these successes this we switching to a cnbc exclusive that andrew did, he sat down with saudi aramco's ceo. here's what he to say about electric vehicles. >> i think electric vehicles are making good progress if you look at the number of let trick vehicles in 2016, almost 2 million vehicles electric vehicles. 700,000 out of the 2 million is hybrid so there is an oil-based engine there.
2 million out of a car fleet of 1.3 billion is a small percentage so electric vehicles will continue to grow they will take good market share. but it will be decades before they shoulder significant percentage of the energy >> do you have to do anything to prepare for that moment? as i said, we are, as an industry, general what we are doing, we are making sure we have the right amount of protection capacity, right amount of reserve to be there for the future we need to supply the world with enough energy. at the same time we're cognizant we need to have our carbon footprint. there are a lot of problems with the industry that saudi aramco is doing minimize our carbon
footprint. >> that was andrew's interview with the ceo of saudi aramco we are approaching the top of the hour that means the rest of the team is getting ready joe joins us with a look at what's coming up >> wilf, how are you >> i'm good. >> i don't know. if i were -- why are you laughing you heard it >> any way >> i heard you laughing. so i was awaiting some kind of insult towards my accent >> i know it's not just me up with you didn't pick this comey and mueller -- >> no, i was going read out the communist party man feifesto >> it's funny because the former fbi director looks into -- >> i picked your teammate's
column come on. >> my god, great he'll probably -- he'll find a way to bring it up i also like the wages of -- this is true, to. kevin hassett. i felt it, if you try to say that maybe lower corporate rates could allow companies to compete better, could allow them to earn better profits, might allow them to expand more, which could mean more jobs. >> it's hard to say it means a 4,000 tax cut -- >> there's other numbers other than the $4,000. did you read this yet? >> no. >> you already got the answer. >> 4,000 -- >> like what's his face. shum hechumer has got it. >> that's the point, nobody has seen the plan. >> it's worth at least 4,000 i don't know >> coming up on "squawk box,"
joe will be reading the newspapers out loud. >> you always pick "the financial times" pieces that i avoid. then i have to listen them presented by you >> presented with communist spin >> euro globalist elitist spin katie stockton, one website said this is it in terms of market corrections. it's always good to have her on. we'll see what she's talking about. she's talking about higher and higher levels of the s&p and we'll talk to rubio. i bet senator rubio might have an interest in this re-emerge sense -- i see peter schweiker everywhere i admit it's nice to buy $100,000 of ads on facebook this is like tens of millions of
dollars that were changinghand with clinton foundation. the way it worked out. maybe it's something we need to look at. i understand perhaps you won't get comey or maybe mueller, but republicans on the house intelligence committee and the senate intelligence committee, you would think they could investigate this >> joe -- >> that's where i'm coming from today. >> we look forward to it always coming up in nine minutes time still to come, the busiest e pofoor earnings, we'll discuss thtop rtlio manager. [vo] when it comes to investing,
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prevagen. the name to remember. hi, i'm mindy kearns. it's great nice to meet you too. your parents have been talking about you for years. sorry about that. they're all about me saving for a house, or starting a college fund for my son. actually, i want to know what you're thinking. have a seat. knowing that the most important goals are yours. multiplied by 14,000 financial advisors, it's a big deal. and it's how edward jones makes sense of investing. welcome back to "worldwide exchange." i'm wilfred frost. futures pointing higher by 52 points joining us is jack caffrey from jpmorgan private bank. thanks for joining us. >> thank you pleasure to be here. >> what's your top sector pick this earnings season so far?
>> i think if you look where the earnings are supposed to be coming from, it's aninterestin mix of the value sector in energy and the growth sector in technology in terms of how we're looking at portfolios, we're splitting our exposures between some of the more secular growth in technology, which has been working, and where growth has been hard to come by in the broad economy. at the same time having success with the financials and energy stocks where we think investors are too dour in terms of what they're expecting from growth. looks like a barbell when all is said and done. what is your view in terms of general market levels, valuations and the chances of a correction >> there's a lot to unpack in that question. valuations in the equity market are above average but have been that way for several years we managed to have markets continue to move higher with the above average valuations that comes down to what else can you do with your money had a nice conversation with a colleague at the end of last week, he was trying toing to m
point about a possibility of a correction and talking about the market decline in 1987. at that point, you had fixed income yields rising dramatically before markets noticed. right now the ten year has come off its lows but remains relatively low in the context of history even where we were six months ago at that point, the equities remain reasonably valued in terms of what that makes for an odds of correction, it's always there it always makes sense that there's some sort of news item, some catalyst that can justify we have not worried about this before, we need to price it in, but the question comes back to does that question become something deep fer you see real risk to earnings outlook >> what sort of rise on the ten-year would you be concerned about over what time frame hitting 3% >> most people are talking about a 275, 3%.
at this point in the calendar it's less likely we get to the higher end of that range i think if you were to see a back up as we saw in the taper tantrum, when you start thinking about a few years ago, we had a 100 basis point move in mortgage rates, that led to some slowdown in housing activity. since the housing cycle seems to be the economy cycle, that's an interesting transmission mechanism we need to keep our eyes on. it's how the treasuries affect the consumer. what is your top overseas market >> i think you come back to europe this is a market that's early in the actual recovery valuations are reasonable. the european central bank is relatively accommodative >> great stuff lovely to see you. that's it for "worldwide exchange." we are looking at around a 40 to
50-point gain in the dow in the premarket coming up slight declines yesterday that's it. "squawk box" comes up next so you're looking for male customers, ages 25-54, who live within five miles of your business? like these two... and that guy. or maybe you want to reach women, ages 18 to 34, who are interested in fitness... namaste. whichever audience you're looking for, we'll find them we're the finders. we work here at comcast spotlight, and we have the best tools for getting
. good morning market alert global stocks edging higher after the dow snapped a six-session winning streak general electric did not help the cause yesterday for the bulls. china's president xi is cementing his power at the communist party congress he's been enshrined in the party's constitution putting him in the same company as the founder of modern china chairman mao. and it's a busy morning for corporate earnings we'll get reports from four dow components even before the opening bell it's tuesday, october 24th, 2017, "squawk box" begins right
now. live from new york where business never sleeps, this is "squawk box. good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in sometimes square. andrew will join us live from saudi arabia later this hour >> steady as she goes. >> oh, president xi. >> that's a good one i did not get the connection ♪ >> very clever >> 6:00 a.m., one person got the connection the producer no, he told me >> i thought you got it. >> no. i still don't get it >> i think it's president 11 i'm still confused le