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tv   Worldwide Exchange  CNBC  July 19, 2019 5:00am-6:00am EDT

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it is 5:00 a.m., here is your five at five. the new york fed clarifying some dovish comments from one of the most important figures at the central bank the bulls continue to charge stocks back in rally mode as invests await one of the busiest weeks of earnings season. boeing help to give a boost to markets, trading higher after it announces a major charge related to its grounded 737 max fleet. general motors is taking the wraps off one of its most anticipated corvette redesigns
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and the temperatures are rising a major heat wave set to hit the majority of the united states over the next few days here we are. we're keeping you calm, cool, collected and informed it's friday, july 19th "worldwide exchange" begins right now. ♪ good morning welcome. i'm contessa brewer in for brian sullivan stock futures right now are in the green. implying an open of up 92 points the s&p 500 is up about 6 points the nasdaq futures are up 41 it looks like the nasdaq, the dow, the s&p, all on pace to break two-week win streaks a decent day today could change those fortunes the major averages are less than a percent below they're all-time record highs the bond market now, let's look at u.s. treasuries, the two-year
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yield at 1.7 the five-year up at 1.7. the ten-year up above 2% now let's go worldwide in asia, looking at overseas markets. the nikkei is up more than 2%. this is on talk about the fed rate cut and what anticipation lies in store. the hang seng up a percent shanghai up a percent as well. in europe we're also seeing stocks in the green in germany, in france, the cac 40 up a half percent. the ftse up more than half of a percent. only the italian markets now down and in the red. the new york fed took the unusual step of clarifying comments by its president, john williams yesterday he stoked expectations that the fed may be more aggressive cutting rates he said central bankers need to cut rates quickly as growth slows. a fedex pert said williams
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spooe speech was academic and not necessarily a signal that may happen at the fomc meeting joining me now is seema shah how would you characterize this walkback, fairly rare on the heels of williams comments >> it is very rare it tells us the fed is trying to reassure markets maybe that things are not as bad as a 50 basis point cut in july would suggest. maybe 25 basis point cut is more likely from here, you know, the market is focusing on what the fed will do in july but also what it indicates it will do in the future i think from here at this point in time, it's the earnings season that the fed will be watching closest >> and does this change at all what you expect the prospect is for a rate cut from the european
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central bank >> with europe, they are in a different situation. in the u.s. we have a clear indication maybe that i think economic indicators could be turning and that by the end of the year we will see a turnaround in the u.s. economy for europe, their outlook is weaker they have been suffering from below target inflation for a long period. if anything happens, it seems most likely that the ecb will be doing some type of action in september. we expect next week at the ecb meeting they will take the time to prepare markets for any kind of moves they will make in september. >> lay out for me, if you will, how you see this second half of this year playing out. where the rate cuts come in to play and where earnings come in to play and how that shakes out the next six months. >> right so the way i consider it, risk assets are at the cross roads. what we've seen this year with
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the drastic move up in equities has been driven by multiples, not earnings i feel multiples need to be validated by stronger earnings that's why this earning season is very important at this stage. on top of that we have the fed to consider. the fed, if you look at the s&p moves over the last six, seven months, most of the big moves have been on days where the fed has spoken the fed has been driving the multiples. if we see the fed meeting market expectations, we should expect risk assets to rally strongly for the remainder of the year. if you have got weak earnings you only have a 25 basis point cut by the fed, we'll see a much weaker move ahead for the second half of the year we're at a crucial time right now which will guide us where assets are going for the rest of the year >> we were showing some big companies to report earnings next week. we'll see a heavy focus with companies on international exposure whirlpool, amazon, alphabet. talk about how the perspective
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resolution on trade tensions plays into this or whether we'll see a continuation of this standoff with china. >> it's interesting you say this with those larger companies, the focus will be on guidance. one of the reasons is for economists it's difficult to measure what the impact of this trade war has been and will be so there's a continued second round effect on sentiment which will impact business and investment that's why there will be focus on those larger companies, which do trade internationally for my perspective, maybe the market seems to have forgotten a bit about the risk to do with the u.s./china trade war it seems unlikely there will be a full resolution any time soon. we could see repeated escalation a couple of tweaks here and there that will upset markets. that will continue to weigh on multinational earnings and guidance >> as we continue to talk about
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what is in store from the fed coming up and central banks around the world, what do you expect to see in terms of invests taking on risk we've seen so many people didn't get in on the rallies since the beginning of the year and they're desperate to put their money to work. as long as you don't see a serious economic slowdown, we do not see an economic recession in the foreseeable future it means people are still willing to put their money to work if you get a dip, qulour moyou' likely to see investors rushing back into the market and buy the dip. that's why any correction we may see over the next few months, if triggered by earnings or a more hawkish fed that will be short-lived. investors are really desperate to put their money to work >> seema shah, thank you very much for joining us. >> thank you we're sure to get more on all of this when boston fed president, eric rosengren joins
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us later on "closing bell. let's get to some corporate news boeing is announcing a huge charge in relation to its grounded 737 max jet fleet frank holland joins us with more >> good morning. boeing will take a 4$4.9 billion after-tax charge related to the grounding of the 737 max the company is bracing for potential payments over several years to airlines for delayed deliveries and disruptions to schedules. those carriers have canceled thousands of flights since the max was grounded in march following two deadly crashes boeing says the charge will cut its pretax profit and revenue by 5$5.6 billion this huge hit will produce the biggest quarterly loss in boeing's history when it reports results next week. the charge only focuses on the impact of the grounding and does not include estimates of boeing's financial liability from the crashes boeing acknowledging mounting
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costs will make the 737 max less profitable the estimated cost to produce the plane will be 1$1.7 billion fwhs th in this quarter. boeing expects the max to return to service sometime in the fourth quarter boeing shares are up 1.4%. >> frank, thank you for that. when we come back, why microsoft shares are aiming for a strong open this morning plus the best sports car for your dollar is about to get a little meaner under the hood gm is lifting the curtain on its 2020 corvette redesign we'll take a look. and earning his title of activist, carl icahn launches a new front in his fight with occidental petroleum a busy hour still ahead when "worldwide exchange" retnsur fun fact: 1 in 4 of us millennials have debt we might die with. and most of that debt is actually from credit cards. it's just not right.
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there's a live shot of the big apple, new york city, where it's about to get steamy and hot. heat watches and warnings in effect, not just for the city but across much of the nation. we'll get into that later. welcome back good morning here's how your money and investments are setting up today. the stock market is ready to end the week on a high dow futures up on a significant gain 90 points. looking towards an indicated open let's check on some of the big stocks on the move today shares of microsoft trading at a
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record high. the company's fourth quarter results beating forecasts, driven here by continued froth from its cloud business. microsoft also projecting cloud sales of up to 10$10.5 billion o this quarter that's above analyst estimates skechers surging today as second quarter results topped forecasts. the company saw big sales gains in india, china, mexico, the middle east, and strong demand for its women's, men's, sports and street wear lines. carl icahn filed a proxy statement seeking to replace four board members at occidental petroleum. icahn aleleges the board mismanaged its deal to buy anadarko occidental petroleum unchanged now in the early premarket. still on deck, a key design feature that is bringing gm's
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corvette redesign to new heights. and this weekend will mark the 50th anniversary of the apollo 11 moon landing we will look at the new space race and what's next for nasa. stay tuned this is "worldwide exchange." tell him we're flexible. don't worry. my dutch is ok. just ok? (in dutch) tell him we need this merger. (in dutch) it's happening..! just ok is not ok. especially when it comes to your network. at&t is america's best wireless network according to america's biggest test. now with 5g evolution. the first step to 5g. more for your thing. that's our thing.
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live shot of the windy city, chicago, illinois. it's 4:16 in the morning by 10:00 a.m., chicago will be
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under an excessive heat warning that will last until tomorrow evening. hot and steamy throughout much of the country after years of being dubbed the best sports car for your dollar, the corvette is getting a huge makeover. the changes are expected to appeal to a new breed of buyers. phil lebeau got an early look. >> this is what chevy corvette fans have been waiting for the first mid engine corvette built by general motors. the company taking the wraps off of it at an event in orange conte, california. why is this important? this is the first corvette where the engine is behind the driver and passenger. that will allow the vehicle to have greater power and performance. the most important thing people will take away is the starting price point. it is going to start at under $60,000. general motor also start taking reservations and deposits, and
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they expect the first deliveries of the new corvette to begin sometime later this year phil lebeau, cnbc business news, california >> so still ahead, in the hot seat, an nbc news investigation into the dangers thousands of delivery drivers face as temperatures head well past steamy and later, with box office sales slipping, can two new movie trailers that just dropped last night bring the excitement and the dollars back to the silver screen? this is "worldwide exchange" on cnbc take prilosec otc and take control of heartburn. so you don't have to stash antacids here... here... or, here. kick your antacid habit with prilosec otc. one pill a day, 24 hours, zero heartburn. they have businesses to grow
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[ sigh ] introducing an easier way to move with xfinity. it's just another way we're working to make your life simple, easy, awesome. go to xfinity.com/moving to get started. ♪ good morning, hong kong. good to see you out there. hong kong, as you can see, cloudy and overcast. looks like asian markets had a great day today. closing in the green hang seng up a percent or so the shanghai up a percent. look at the futures here in the united states. it looks like the dow jones industrial average ready to end the week on a high note. futures indicated up 92 points nasdaq up 42 points. anheuser bush inbev is selling its australian operations to asahi in an $11 billion deal the world's biggest brewer is working on paying down debt
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after failing to list it's asia business the brewer said they have not given up pepsico is expanding into africa they will buy the outstanding shares of pioneer food group for 1.7 billion. and gannett is working out a deal to combine with gatehouse media. gatehouse media is owned by private equity and is known for aggressively cutting expenses at the titles that it buys. gannett here up 11.3% in the premarket. let's get a check on the morning's other headlines. phillip mena is in new york with the latest getting ready for a heat waive >> we sure are tensions are rising between the u.s. and iran this morning after a u.s. warship destroyed an
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iranian drone in the strait of hormuz the warship fired on the drone after getting too close and threatening the safety of the ship and its crew. this comes one month after iran shot down a u.s. drone in the same area. president trump says he plans to nominate eugene scalia as his next labor secretary. the nomination comes after secretary alexander acosta was forced to resign following fallout from the jeffrey epstein sex scandal. and firefighters had to resz cue several people from a roller coaster it got stuck at six flags america maryland it came to a stop at the top of the lift hill. all guests were safely escorted off the ride the ride will remain closed while being inspected by certified ride technicians scary sight there in maryland. >> if they're going to get on that roller coaster they were hoping for thrills they wanted to be scared
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>> yeah. >> that would do it. >> you're right. >> maybe they got more than they bargained for. >> look at those loops, they could have gotten stuck upside down that would have been scarier >> maybe because i see these stories it makes me think i'm good on the ground i'm all right with that. have a great weekend >> you, too. when we come back, the big business of pets one of the hottest ipos this year gives new investors and their furry children something to cheer about this morning. we'll just dig in. plus the walk back heard around the world what comments from fed president john williams could mean for invests. futures pointing to strong gains at the open. "worldwide exchange" is back after this
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here we are. the height of summer welcome back thanks for being with us i'm contessa brewer. here's how your money and investments are shaping up halfway through the 5:00 a.m. hour in new york and it looks like the dow jones is set to pop up about 79, the indicated futures here the nasdaq futures up 36 points on the day bonds now, the two-year rising 1.7% is the yield. the ten-year yield is also rising at 2.04%. we'll have much more on the markets in a moment. first this weekend marks 50 years since the apollo 11 moon landing when american astronaut neil armstrong took one small step for man, one giant leap for mankind. jay gray is live at the national air and space museum in washington, d.c. what an exciting time to be
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there, jay >> contessa, yeah. an amazing weekend as you talk about. the giant leap still making an impression a half century later. it is amazing to see this museum that honors apollo every day this week is different it's special just like the men who made that historic journey two of those, michael collins and buzz aldrin expected to be here today as part of the celebration. neil armstrong, the first man to walk on the moon passed away in 2012 his family will be well represented here it's been going on all week. it 14should continue through th weekend and be fun and interesting. i got a chance to talk with michael collins yesterday. he said the legacy and lesson he takes from his flight is that we've got to continue space exploration but also take better care of what he calls this
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fragile planet >> jay, thank you very much. we'll have more on this in a little bit appreciate the sneak peek there. as we mentioned, futures are pointing to another day of green arrows on wall street. fed officials hinted at some more aggressive policy easing. stocks were trading lower yesterday until we heard comments from new york fed president john williams. he said the fed needed to act quickly when the economy was slowing and rates were low in a speech he also said it's better to take preventive measures than wait for disaster to unfold. stocks jumped on that news as investors started to bet on a bigger rate cut at the fomc meeting. notably the new york fed is now trying to cool that speculation. a spokesman said williams was drawing from academic research and not hinting at potential policy actions joining me now is the founder of
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end pra n entrepreneur shares. this pullback was notable from the new york fed saying don't read into it then we saw comments from clarida on fox basically echoing what we heard from williams. how do you read into this? is citi right to already say we're changing our fed call. we think it would be 50 basis points >> for a while we were looking at 25 to 50 basis points 50 basis points is on the horizon and there was a hint that a couple members of the fed were discussing doing more we have to remember this is the strongest june and july we've had since 1955 for the s&p the strongest we had for the dow since 1938 we've benefited quite a bit for the markets this summer. >> all right chad, when looking at what the expectation is here, after clarida spoke, we saw that fed funds rate jump to 69% expectation for a 50 basis point
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cut. how do you read this where are you putting your money in terms of this fed cut >> we're believers that they'll go 25 basis points based on the fact that you have virtually full employment, inflation trends look to be improving modestly in the short run. and then global growth and global financial stress doesn't look all that high >> so those comments yesterday did not change your expectations in. >> i would look past those comments i would pet that potentially by the end of the year they go another quarter point. it's all based off of trade related issues as well as globa growth issues outside of the united states at this point. >> when we talk about trade and global outlook,next week we're getting some earnings reports from some of the biggest names with international exposure. looking for boeing, caterpillar, amazon, especially these f.a.n.g. names, the "fa" in f.a.n.g. how are you assessing the impact of this continued standoff and
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tensions with china? >> so traditionally the f.a.n.g. stocks are very entrepreneurial companies. these entrepreneurial companies adapt quickly to changes in the marketplace. we saw a hiccup yesterday with netflix. clearly the international growth is part of the grop thdrop they. when we think about these companies, they're spending lots of money, spending 20%, 30%, 40% increases in r & d they are able to pivot quickly they also have concentrated ownership. the leaders of the companies can move it. i think we'll see some mixed results. certainly with boeing and a few others we anticipate some negativity and i think what i do, when i look at the large cap stocks, i break them down into the traditional sort of more bureaucratic companies that move slowly versus the younger companies which tend to be the f.a.n.g.s that pivot quickly
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i think this will be an interesting summer we saw yesterday microsoft went up, netflix went down. >> chad? >> from our perspective, you now have the market overall when it comes to earnings bifurcated you have large cap tech names that have been moving the revenue line for the s&p 500 estimates quite high at roughly a 10%. like microsoft then you vice president tice pre the industrials, and those should be more muted >> let's talk more about oil oil is moving higher on news that the u.s. navy downed an iranian drone. we got news yesterday that iran captured a smuggler ship, an oil tanker that it said was smuggling oil. how much are you looking at the geopolitical impact of what happens with an iran deal and the potential that european leaders won't be able to work
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out a deal >> back in the 1970s this type of news would have been catastrophic for oil prices. we would have seen them jump 10%, 20%, 30% on fears of war in the middle east. with fracking now positioning the u.s. as the largest producer we've benefited quite a bit from this news. this is why despite some rumblings in the middle east over the last month or two, oil has been dropping in price and energy is the one sector that is not yet recovered year to date i see continued movement in this direction. maybe there will be some modest rises, but the fracking is insulating the u.s >> short-term and long-term. in the short-term, yes, you will get headline risk that will make the oil market fluctuate in a violent manner in the long run we are believers that you will see deceleration of global growth at china em, that will adjust the demand curve lower, that will have a
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major impact on oil prices and commodity prices over the next three to five years. >> thank you both for joining me so early the fed and the markets coming up. catch a cnbc exclusive with boston fed president eric rosengren on "closing bell" at 40k 30 check out shares of cloud strike the cybersecurity company posting better than expected revenues since its ipo they added more than 500 new customers in the quarter and those customers are buying multiple products on the platform. and wework will host an analyst day for wall street banks on july 31st, ahead of its upcoming ipo this comes as the "wall street journal" reports wework's co-founder and ceo, adam newman cashed out of more than 7$700 million in the company
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while he remains the biggest shareholder, the move is unusual since founders typically wait to sell holdings until after an ipo. another name is chewy, the online arm of pet retail giant pet smart reporting its first numbers as a publicly traded company generating more than $1 billion in sales on a net loss of just a little less than $30 million. we heard from the company's ceo on "closing bell" yesterday about the still untapped potential in the pet e-commerce space. >> two things. if you look at in 2017 the pet market jwas 7$70 billion. it's an average household spend of $900 to $1,000. if you look at e-commerce penetration in the united states, it's still low we are still early in the growth >> joining us is web bush's seth
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basham do you agree that this is still early in penetrating the online delivery space when it comes to pet products >> yes i sincerely do i think penetration now is around 15%, 16% of the category on our estimate of a $50 billio market and we could probably see that double over the course of the next five, ten years >> chewy has to compete with not only amazon, but walmart, target, other specialty retailers. how does it differentiate itself and still maintain margin? >> it's platform is one that offers extremely good customer service. almost like you're going into a pet store. you can get information online or get information from specialists that you call on the phone. in addition they have a wide assortment of products ones that you can't find in all stores delivery isfast and efficient. you can get product when you need it within one or two days and have it delivered monthly.
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>> the company eventually increased its first auto ship order discount to 60% from 30% now that discount declines as you keep moving forward. do you have concerns about its profit margins if it has to continue to offer those kinds of discounts to compete with amazon >> yes, i do 60%, i think, is extreme they put on a 60% discount for first auto ship orders in response to amazon's prime day offer, which was 60% off for subscribe and save orders. they've taken that discount down, back to 30%, which has been the norm for the first part of this year so if we see them have to compete with amazon which is running 50% off, it will eventually impact their margins or their ability to grow customers. >> when you compare chewy to other retailers attempting to break into this e-commerce environment, bed bath & beyond, you cover restoration hardware,
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lowe's and home depot, do you see that as an ongoing struggle that in order to attract new customers, in order to somehow compete on delivery fees, that you will see shrinking margins or tight margins >> right across the hard line space we've seen a lot of margin compression, particularly in home furnishing iin ining drive wayfair's entry into the space we do believe margins have come under pressure >> i want to ask about lowe's and home depot the new housing numbers does it change how you see the second half of the year for the home supply companies >> home depots and lowe's are struggling a bit more. it'sdriven by the macro factors. there is a down draft in demand for home improvement retail
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sales. >> if we see refinance costs lowered because of a lower fed rate, does that change people, who will refinance and go in and do home improvement? >> lower interest rates help drive housing, refinancing there's usually a 6 to 9-month lag between the time in changes in rates and the improvement in home improvement sales seth, thank you very much. >> thank you. coming up, this weekend is bringing the heat. sky high temperatures that you can expect what precautions you can take and how companies are trying to manage their costs that are associated with heat and then it's the 50th anniversary of that iconic giant leap for mankind we'll talk about what it will take to get us back to the moon. it's a real moonshot that's when "worldwide exchange" returns. that's what happens in golf nothiand in life.ily. i'm very fortunate i can lean on people,
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the sun is up in new york city it looks hazy and kind of like a soup out there it will be hot in fact, we'll get into what the business of heat means but we want to talk about some stories you're probably talking about today in our top trending stories. frank holland joins me we want to start with weather. two-thirds of the country is just melting in a heat wave. >> complete scorcher >> we have all these heat warnings coming up bill karins -- oh, janessa is with us from new york with the forecast >> we will continue to see the heat building across the plains, the northeast and the mid-atlantic warnings have increased across the east we have not talked about overnight lows they're going to be enhanced
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throughout the weekend we're seeing lows now, they're currently in the mid 80s it's hard to sleep these warnings have expanded into the northeast i do expect them to go into the mid-atlantic we have over 40 states, 168 million people throughout the weekend. now, this is going to be a prolonged weekend event before a cold front starts to slice through by monday. let's look at today's highs here when you factor in the dew points along with the air temperature, in cleveland, 107 degrees. that really starts to enhance this high pressure, that shifts into weekend we will see records even for d.c. and into new york city. hydration is key make sure you have ac running. the interesting thing is you had the new york city mayor getting up in a news conference this week and telling people, look, we want you to set your
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thermostats at 78 degrees. it raised the question for me about whether companies would do the same they're consuming a lot of energy in the middle of the day. but it turns out that a lot of these utility companies send out a device that monitors and can help people control their air conditioners from away so it's like a plug you plug your air conditioner in. you can turn on the air conditioner before you get there. >> here in new york city, they're focusing on people with the wall units, the ones you put in the window. you can't really control them wifi, so they give you a device so you can control them that way. so instead of leaving them all day, you can do it an hour before, cool the house, ease up on the grid and they give out rewards. >> a lot of these utility companies also then have access to your air conditioner. >> that's the tradeoff what do you think? >> they say in the cases where we have an overload on the system, we could go in and
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either set your therm stalt hos higher, or we can take a few minutes per hour out of the compression, the creation of cold air and just leave the fan running. >> it is a constant thing of us trading off a benefit for some of our privacy something to think about especially on a hot day like this today it is really hot even in dangerous heat like this, routine work, it has to continue that includes the vital jobs of delivering packages. most drivers, those trucks are not equipped with ac temperatures in the cargo area can reach 140 degrees if your delivery is delayed, maybe cut the driver slack >> they're working long hours because they have a lot of amazon packages to deliver another bad quarter for the box office
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q2 ticket sales were down 4% from this time last year the first quarter was down 16% year over year disney's lion king remake crossed the 1$100 million mark. that blockbuster opens in the states this weekend. great cast james earl jones, beyonce. fantastic. >> remaking a lot of these movies >> more reasons for optimism for the box office down the road trailers for "cats" and "top gun maverick" dropped yesterday. >> i think they luck out with extremely high temperatures. people will be looking for indoor things to do when you have a feel-like factor of 109 degrees. you want to be in air conditioning so this might be good for the movies this weekend that it coincides with a heat wave >> what's cooler than the theater? you know what is space. we have some more amazing spacex video this time it shows
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parachute capsule recovery systems. the giant parachutes will allow manned space capsules to return to earth safely. spacex hopes to send astronauts to space and back with this technology by the end of this year space travel has come a long way since americans first landed on the moon 50 years ago. now we're looking to head back >> reporter: 50 years ago the first humans stepped foot on the moon the apollo 11 mission cinched america's dominance in space, a lead that continues but waned after the cold war's close now that is changing >> liftoff. >> reporter: companies like spacex pioneer reusable rockets that cut the price to go to orbit ushering in a new era of billionaire backed space exploration that gives americans more options nasa's new lunar program is
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artemis. it would send americans back in five years a feat that can only be achieved with the help of the private sector companies are focusing on everything from rockets to moon mining to habitats astrobotic has almost 1$100 million in contracts including recent awards from nasa. >> we offer nasa a much more affordable opportunity to regularly fly pay loads to the surface of the moon that will open the doors wide open to scientists and explores and technology developers all over our country and all over the world. >> reporter: jeff bezos' blue origin developed blue moon the lunar gateway. a space station that would orbit the moon which several contractors are competing to build. >> the purpose is for nasa to launch exploration missions from there and support exploration of the moon and other locations. >> reporter: but it will all take more money. up to $30 billion over five
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years according to nasa. for lindsay, a former space shuttle commander, it's not a matter of whether space goes mainstream but when. >> i want to some day walk into a school and say i'm steve, i'm an astronaut all the kids look at me and say big deal >> reporter: for cnbc business news, i'm morgan brennan >> that might already be the case the fact we can talk about and we consider going to space a possibility means our culture and expectations have changed. >> i was reading it took 400,000 people to make the apollo landing happen the first time. now we have private companies, a lot less people, more technology one day me and you may be up there. >> me, way, way after you. thanks, frank. will tech stocks take the record market run to the next level or will invests be bitten by the f.a.n.g. names? the debate next. and later on "squawk box,"
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don't miss marc lasry. stay tuned, this is cnbc
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boeing will take a 4$4.9 billion charge in the second quarter due to the global grounding of its 737 max planes. the charge is set to wipe out profits. the jet vs have been ground sine mid-march after two fatal crashes. president trump says a u.s. navy ship destroyed an iranian drone in the strait of hormuz yesterday in what he calls a defensive action the drone apparently got too
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close to the uss boxer and ignored calls to stand down. the u.s. military has an increased presence in the area amid escalating tensions 20% of the world's oil passes through the strait of hormuz wti and brent up more than a percent. jcpenney reportedly hired debt restructuring advisers. the retailer is looking at options that would buy it more time on working on a turnaround. jcpenney carries $4 billion in debt that comes due in the next few years. f.a.n.g. stocks front and center for investors facebook, amazon and alphabet or the "fa" in f.a.n.g. will report quarterly results. joining us now with a preview of what investors need to know is gene munster set the scene for me we heard from netflix with some disappointing subscriber numbers. what do you expect out of facebook, amazon and alphabet? >> contessa, from a high level, this is a transition quarter,
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which is different than the wake-up quarter that netflix had. a transition quarter means there will be headwinds. but i think that the themes are on the broader f.a.n.g. will be intact at most risk next week is going to be google in part because last quarter they had a dip in their revenue. they had four years of consistent 20% revenue growth. that dipped last quarter that's not the reason why there's a head winwind they have to be more skillful at navigating questions on what potential regulation could come. google has been largely spared of these regulations and tweaks from regulatory bodies but i think ultimately that's something that investors will weigh more heavily on. and facebook is still in that camp they have regulatory questions i would put those in the headwinds camp apple is a unique case they're the only one of the f.a.n.g. companies that have
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exposure to china. that's about 10% of their business and that china exposure has been well known i took apple and put them in the camp has probably has more upside than down side. separately, if you look at the f.a.n.g. stocks over the next year, i think apple has meaningful upside and could double over the next couple of years, where the other f.a.n.g.s will be leaders more broadly do you feel you got additional insight this week as to what's ahead for facebook and google given the hearings we saw on capitol hill where especially democratic law maesmakers were grilling facebook over libra they were talking about privacy issues that continue to plague facebook >> we did get some insight, the insight was the temperature of these regulators, intensity they
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have at doing something. so we think that the messaging, the rhetoric will continue maintain at this level, which will have an impact on amazon and google's multiples if you think what will happen longer term, i think this regulation will be unlikely to yield a breakup. there can be modest regulatory impacts. both facebook and google have free products. consumers tend to want free products if there was greater regulation, these companies may have to charge for these products and consumers and voter s don't want that >> we were showing the amazon stock right there. the prime day units you mentioned were up 75% year over year
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a lot to of new subscribers here now we're watching for amazon to deliver on that. gene munster, stay cool in the heat to come this weekend. >> thank you that does it for "worldwide exchange." hope you have a fantastic weekend. "squawk box" begins right now. i do that, too wait a couple of seconds keep every second for yourself good morning dovish, fed signals raising hopes of half point interest rate cut i saw something from bullard saying maybe the situation does not warrant that we'll see. the new york fed is also walking back those comments. the details are straight ahead. microsoft shares are soaring to new highs on strength from its cloud business we'll bring you reaction from wall street. earnings from blackrock hit the tape this hour we'll bring you an extended interview with larry fink on where the company is putting more than $6 trillion to work. it's friday, july 19th, 2019
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we have double digit temperatures today headed higher tomorrow and sunday. "squawk box" begins right now. ♪ live from new york where business never sleeps, this is "squawk box. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen andrew is off today. let's look at the u.s. equity futures. as joe was mentioning, there's all these hopes out there that maybe you'll see a bigger move from the fed, a bigger cut than anticipated based on those comments from new york federal reserve president john williams yesterday. you see the futures picking up this morning after ending in positive territory yesterday right now the dow futures up by 58 points. s&p up b

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