tv Squawk Alley CNBC August 9, 2019 11:00am-12:00pm EDT
out. ultimately, the world will benefit from global trade. and so -- >> jeb, we're out of time. we're going to have to end it there. and i apologize. we'll have you back. thank you, jeb hensarling. now we'll go to morgan >> rick santelli, thank you! good friday morning. it is 8:00 a.m. at uber headquarters in san francisco. it is 11:00 a.m. here on wall street "squawk alley" is live ♪ good morning and welcome to "squawk alley.
i'm morgan brennan with melissa lee and mike santoli live here at post 9 at the new york stock exchange carl and jon are both off this morning. we've got a big show ahead with shares of uber tanking more from our exclusive interview with ceo dara khosrowshahi in just a few minutes. and later, dropbox dropping in a big way with those shares down 13%. ceo drewhouse will join us in another exclusive at the bottom of the hour. but first, we'll begin with what's really been a wild week for the markets with the dow down triple digits again down right now about 165 points. what should investors make of the big swings in stocks that we have seen for this week? bob pisani has those answers from the floor here for us bob? >> and the answer is that it depends on what the president is doing on tariffs and what the federal reserve is doing the president just making comments moments ago, not ready to make a deal on china yet, and that's frankly what's been moving the markets for the last week or so you see semiconductors, trade-related to the downside, retail, a lot of these retailers
import from china. they're weak, so there's the clearly trade-related headlines here industrials, also trade-related, and you have a flight to safety in utilities we've been talking about that all week, about that flight to safety move here there's rumors about or stories about huawei out this morning. suppliers to huawei, a lot of these semiconductors are weak. the white house is reported to be holding off on a decision about licenses for the u.s. companies to restart their businesses with huawei these are huawei suppliers you see them all down 3 to 4% or so retailers i mentioned, a lot of them import from china they're all noticeably weak here you see this move to the downside i want to point out, jcpenney is below a dollar and that's been moreau below a dollar for a while they have received a noncompliance letter from the new york stock exchange. they are in danger of being delisted they have six months to get that stock price above $1 on an average basis in the last month or they're in danger of being delisted that's a separate story going on
there with jcpenney. elsewhere, there is some stuff hitting new highs. all of this crazy volatility you know who's been benefiting from it? stock exchanges and exchanges that deal with options cme, new high. intercontinental, new high cboe, new high they own the vix indexes do you think that's active there are some people that have been benefiting from all the craziness. toronto stock exchange yesterday had numbers that were outstanding. that's also at an historic high. where are we those tariffs loom the president just said, we're not ready to make a deal yet, so new tariffs loom and a lot of people are trying to figure out, are there going to be additional tariffs on september 21st the bar is low to declare a second truce you can do that fairly easily. and i think the chances that can happen are higher than some think. some think it's pretty small i don't see a large constituency from wanting new tariffs other than peter navarro and possibly the president himself, and that's the person that really matters. a lot of moving parts, here, guys, back to you. >> let's try to make sense of them here.
let's bring in jim lowell as well as tina hooper of invesco talk more about these markets. christina, let me start with you, this week we've seen, perhaps, both the benefits and the potential warnings involved in low bond yields and what the implications are obviously, when bonds were kind of racing lower in yield, the stock market got a little bit spooked. if it means that we're headed for some kind of recession, it's obviously a problem. if it means inflation is low, central banks are dovish, maybe not so much. where do you come down and what does it mean for stocks. >> well, it means that there's certainly a lot of fear out there. i believe the ten-year treasury is a very good gauge of fear far better gauge than, for example, the vix so it suggests that there are concerns out there but it doesn't necessarily mean that the market doesn't also see opportunities. because we've actually seen stocks hold up fairly well so this could be an environment where, because yields are low, but there's enough confidence in the economy, at least right now, that we see investors stay invested, perhaps, though,
moving to higher-yielding parts of the risk spectrum, such as dividend-paying stocks and perhaps emerging market debt >> jim, as somebody who thinks about asset allocation, valuation of the market, obviously, equities do have a valuation cushion if yields are low, but what does it mean for you in terms of where there is opportunity in stocks? >> so, we absolutely see the warning signs from the bond market, the gold market, even the stock market itself, sending certainly a cautionary flag up the pole but we think there's select opportunities, dividend growth stocks, absolutely would agree with that. especially dividend growers. we also like the beleaguered health care sector on a selective basis. and we've been shifting some assets from our large cap international stakes into the small, mid-cap names in the foreign skand emerging marketplaces that have a lot less issues and concerns relating to not just currency, but also to the tariff and trade concerns that continue to be the driver of the near-term marketplace.
long-term, we think this is a kind of market that creates opportunities. near-term, we absolutely understand that it's the day-to-day event-driven news that's determining both the direction and the velocity and the volatility of the momentum >> christina, as jim had pointed out, within equities, investors are certainly taking a defensive tilt by investing in utilities and reits and those dividend-paying stocks so when that new fear gauge that you labeled the ten-year yield, when that fear gauge drops, at what point do we stop thinking of it as a cushion for valuations and thinking of it as a signal that investors should take caution >> well, it can be a signal that the economy is decelerating and decelerating significantly but it doesn't necessarily mean investors should get out of stocks that's because we're in a unique situation where we could see the economy decelerate because of tariffs. but because central banks have signaled their willingness to be very accommodative, it should actually be a recipe for support for risk assets.
>> so even if we test 135, which is what a lot of fixed income folks say, which is the previous low on the ten-year yield, that would not signal to you that there's trouble ahead for stocks you'd stick with it? >> i think stld signal that there's trouble ahead for the economy. but we could be in a unique scenario where risk assets are supported because of central bank actions this is the playbook from the global financial crisis. >> jim, thoughts on small-cap stocks the russell 2000 continues to trade in correction territory. we've seen it underperform for months now why has that happened? why would that not continue to happen because i know you mentioned you were looking at some of those small and also mid-cap names right now. >> it certainly could continue to happen. the reason it has been happening is investors have been crowding trades right into the s&p 500 names and not looking beyond that pay element and as a result, many of the names in that pail continue to be at fair or slightly overva e overvalued as opposed to names
inside of the russell 2000, where we know there's some selective good valuation opportunities. but in particular, we think that the long-term opportunities being built on the global market are in the foreign, international, small, and midcap space. i would say that when we look at this market place, we definitely think that now's a great time for investors to review not just their income needs and risk tolerance, but their long-term goals. make sure they're aligned with what is likely to be an ongoing volatile marketplace, not just for the couple of weeks skmoand months, but well into 2020 >> christina, i know you were looking at some non-u.s. asset classes that you think present an opportunity here, that perhaps represent what you said on the risk spectrum for some income >> absolutely. conventional wisdom has suggested that china will lose the trade war and the u.s. will win the trade war. i actually think both economies will be hurt, but ultimately, the u.s. will blink first or the fed will step in in any event, i think chinese
stocks, particularly chinese tech, has been beaten down fallen more than 30% last year, hardly seen much of a recovery this year. so that's an attractive opportunity as the market begins to expect that both economies are going to be hurt and essentially, prices in more damage to u.s. stocks, less damage to chinese stocks >> christina, certainly an against-the-grain call appreciate it. christina and jim. thank you. >> thank you still to come here on "squawk alley," what to make of uber's $5 billion loss and slowest growth rate ever we're going to get "the new york times" mike isaac's take and hear from ceo dara khosrowshahi. you can see those shares are down 7.5% right now. a beat from drop box, but revenue fell there ceo drew houston will join us exclusively. don't go anywhere. we are back after a quick break. (vo) the ant mindlessly marches on.
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if you look at the trends of the company, and this is what's going to matter long-term, you've got gross bookings over $16 billion, growing 37% on a year on year basis you've got trip volume, and trips are a unit, growing 35% year on year you've got audience, monthly active platform customers, now over 100 million, growing 30%. and the actual revenue growth,
and you do have to back out the driver appreciation award, because that was one time. it was important we wanted to do, but it was one time the revenue growth excluding the driver appreciation award was up 26%. and what i did tell our investors is expect that to accelerate into the back half of the year the back half of the year, you are going to see, if trends stay the same, revenue growth in excess of 30%. and when you look at profitability, we beat our own internal targets, we beat street targets, as well we came in at a loss of $656 million. it's still a big loss, but the losses are improving and the take rates are improving >> that was uber ceo dara khosrowshahi joining us exclusively earlier on "squawk on the street" talking about the company's q2 results he also spoke about the increase in competition in the ridesharing market >> if you're going after a $10 trillion plus marketplace, you're not just going to have one competitor, you're going to have multiple competitors coming in we happen to be the biggest in the sector, so when competitors come on, they want to take us
on when you look in the rideshare space, the competitive environment is, i would say, stable to getting better you saw rideshare take rates actually quarter on quarter increase by over 100 basis points so, while it's competitive and we expect to be competitive, we've competed against competitors in paris and london and every single city that we operate in, we have multiple competitors. and usually, we have 60, 70, 80 shares we compete, but we win the eats market continues to be very competitive so while rides, the competitive environment is stable to getting better, we're going to see a lot of competition with eats there's a lot of capital coming into the category, because it's growing. and i think eats is going to be a battle this year and next year >> finally, we asked about uber's investors and the upcoming lockup expiration date. >> there are going to be some investors who believe are absolutely long-term investors like softbank, and then there
are going to be some investors who made a ton of money and they deserve to liquidate some of their shares you know, if we focus on building the business and we focus on continuing to grow at 30 plus percent raises, continuing to increase margins, the rest will take care of itself i'm looking forward to getting the lockup behind us, honestly because i think people talk about it too much and really what we're trying to build is a business that lasts, a business that can attract the best talents in the world that's what i'm spending my time on >> as you see there, uber share is down more than 7% this morning following that $5 billion loss as well as slowing growth numbers with us now with uber on uber's results is "the new york times'" mike isaac, author of the upcoming book and deep dive into the battle over uber, "super pumped," which is out on november 3rd mike, great to have you with us. >> hey, thanks for having me >> i don't want to dwell too much on that $5 billion loss a lot of that could be explained away from stock-based compensation, et cetera. but is there a way where dara
khosrowshahi is not communicating the uber story correctly to the street, emphasizing that it's not important to have a road to profitability right now? i didn't really feel like that came across in the conference call and i feel like that would be the honesty that perhaps investors need, particularly when you compare what he said versus what lyft said in the previous call. >> yeah, totally, i think, i mean, look, dara is a longtime cfo and tends to get into the weeds a lot of the time. i think, probably, what would be helpful in the longer term is just to underscore that we're not going to be profitable in the near-term, you know. and i think they're going to take knocks for that i think a few things are really working against uber, though, is they get -- they had lyft's earnings come just a day or two previous and were really bright against them and uber gets kind of an unfair comparison, because lyft is fighting a -- on the u.s. front, whereas uber is battling literally all over the world and i think the other thing, too
is, where we are now in delivery is where we are three to four years ago in ridesharing and i don't see that -- i think that's going to be really expensive and really painful for at least a few more years and the street has to really sort of understand that and be okay with it if they believe that this company is going to start becoming profitable in the future >> i agree that the comparisons are a little bit unfair, but doesn't it perhaps underscore the question that investors face when they're investing in the ride hailing space, and that is, do you want to be in a more developed market or are you willing to spend several years waiting for a path to profitability, when it comes to some of these other markets, particularly latin america, where didi has become a real fierce competitor. >> that's a really great point and i think the big question mark, too, is, look, lyft has -- the bonus for liyft, i guess, is that it's only really fighting here against one big main
domestic competitor, whereas uber seems to find new enemies every week in every market that it's fighting in like you said, didi barged into latin america last year, softbank is spending billions backing -- despite being on uber's board, backing all of its competitors across the world and delivery is just going to get messier. so i think that's the sort of question that you have to ask yourself if you're willing to invest in a long-term stock. because it's not going to be pretty for a while >> yeah, mike, the delivery piece of this is kind of fascinating to me, because, obviously, softbank, big investor in uber they've also just raised the second vision fund they were asked about it he was asked about in the interview this morning and basically said they're going to put money against the markets, but that's going to expand the markets where delivery is concerned. is that the right way for -- is that how investors should be approaching it and thinking about it because it sounds a little contrarian >> yeah, totally i think moss is kind of a wild card you know, this second vision
fund -- in the first vision fund, he kind of proved that he really doesn't have allegiances, even if he's invested in one company, as we've seen, you know, based on billions into uber and also invested in doordash, which is killing uber and competitive delivery space right now. and i imagine, delivery is the new rideshare as far as investments are concerned. and the growth potential in those businesses is where we were three or four years ago with ridesharing so i think it's going to be more painful. but, like, to be clear, i don't fully disagree with that, because all of the businesses in the u.s., at least, in delivery, are growing right now, even as they're fighting each other. like, delivery is still a growth space. so there's probably like some truth to what he's saying, but i imagine uber, at least, would want him to kind of butt out investing in their competitors >> mike, one thing dara said was that he kind of waiting for the moment he's looking forward to the moment when this lockup
separation has passed. basically, where insiders can sell the stock, it's no longer in overhang, no longer this thing looming on the horizon, which is an understandable thought, i think, for a ceo in this position, but what's your take on whether inside uber, senior management, mid-level people, this is not a very young people it's $70 billion in market company, if there's kind of a culmination cash-out mind-set within the company that's going to really color how it goes from here >> yeah, i mean, the -- this is a 10-year-old company at this point, right like, uber has been private for a very long time if travis kalanick, the cofounder and former ceo were still at the helm, it would be a question as to whether they would still be a private company or not or public at all. and there are people there, the longtime longtimers, who have been working for uber one year probably puts seven years on your life. so i imagine anyone who's left from the early days is going to want to spend that money and get out of there, especially now
that, you know, anyone with really early rsus and really early stock comp is really rich. and might want to go 0 so the one thing i will say is dara has recruited a lot of new folks who are trying to be onboard for uber 2.0 and his vision, so as long as you have folks that are willing to go for the longer haul, it might not just be a rest and vest situation for everyone inside. >> mike, great to see you. thanks so much >> yeah, thanks for having me. >> mike isaac of the "new york times. again, mike's new book, "a deep dive into uber: super pumped" is out september 3rd. all right. coming up, shares of dropbox falling this morning we will talk to ceo drew houston exclusively on that quarter. meantime, european stocks set to close abroad. we'll get a breakdown of today's action overseas in just a few minutes. dow down 200 stay with us
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europe is set to close in just a few moments seema mody joins us now with today's action >> and stocks in europe ending lower after president trump threatened that next month's u.s./china trade talks could be canceled trade-sensitive sectors in europe are leading us lower. and germany's exports dropping once again that's not helping the broader global growth story. and here's what's happening in italy. last night, italy's interior minister and head of the league party, mateo salvini withdrew his support for italy's coalition government, calling for snap elections the reason we're seeing such a sharp turn in markets is a new round of elections in italy could delay the passage of its budget the law requires a functioning administration to formulate a budget so there are broader implications here for the eu the call for snap elections also highlights the rise in tensions between two populous parties inside italy italian banks are lower by about 7 to 8%. and the italian bank index is down about 25% from its recent
weeks. and for the week, italy stock market underperforming its european peers leaders of the coalition government are set to meet on monday so we'll have to see what happens then morgan, sending it back to you >> we certainly will, seema. thank you. seema mody let's get over to sue herrera now for a news update. sue? >> good morning, everyone. here's what's happening at this hour hong kong's leader, carrie lam says the government will not give into protesters' demands. instead, it will focus on stopping the violence and deal with the deeper-seated issues later. >> as far as political solution is concerned, i don't think we should just sort of make concessions in order to silence the violent protesters, we should do what is right for hong kong >> actor richard gear is visiting rescued migrants onboard a humanitarian ship that has been stuck in the mediterranean sea for over a week he helped bring supplies onboard. >> i just arrived here and we
brought as much water and as much food as we possibly can for everybody on the boat. i think there's about 140 people here, maybe 150. >> you are up to date. that's the news update this hour back downtown to you guys. >> sue herrera, thank you. after the break, an exclusive with dropbox ceo drew houston. we're back in less than three. dow is down 258. the s&p is down 33 stay with us
i want to take a check of the markets, because we are sitting at session lows right now. s&p 500, 2902 is the level, down by 0.1%. the nasdaq down by 1.5%. information technology, the leading sector to the downside with this drop in markets, we have seen a relaxation in the ten-year yield we're now at around 1.69%. and in recent days, of course, yield has been the primary driver of the direction of these markets. >> it's been the beacon. and it did slip below 1.7, as you've mentioned there we've given up at this point in the major index a majority but not all of yesterday's bounce. it did seem it was a rebound oversold levels. people got a little bit too negative the bounce brought us right back up to friday's close i think we have to see how the day plays out. because right now we're trading very technically and i think you have to see if
yesterday's rally goes away entirely that's going to perhaps change the equation for some traders. >> all the major averages are poised to end the week down 1% or greater in terms of the losses this week, you mentioned that tech stocks are selling off or leading the losses here today with some of those seminames, due to the latest on these u.s./china trade headlines it's very risk off again, utilities is the only sector in the green within the s&p, but you're also seeing health care, real estate, staples that are relative outperformers, though still lower right now. gold also is once again catching a bit. >> yeah. so again, the dow is off by almost a percent at this point and the nasdaq is also down by about 1.5% let's check in with rick santelli for the santelli exchange rick >> good morning and thank you. as i walk around the trading floors, even walking to the train, even last night in bowling, what do i get asked we're supporting treasuries. everybody's watching interest rates. more so than normal. because of the feedback loop
that's been exaggerated of late into the equity markets. remember, historically, equity markets quake, flight to safety pushes, buyers and treasuries for safe harbor, yields go down. but if yields go down dramatically first, the stock market scratches its head, and that costs everybody who's holding long positions money and that dynamic is an important one. so where will the best support be in treasuries well, unfortunately, that's not an east as an fy an for a big r. if we look at ten-year notes, 207 was a huge retracement level, a 62% center. we are below that. so ask, there's going to be a lot of little support levels but truly, there isn't a really big support level until you test that double bottom at 136. however, there is another way that you could find better support by going and looking at the 30-year bond see, the 30-year bonds' low is not a double bottom, although
this week, maybe we put it in this see, this double bottom happened in july of '12 and '16. this only happened in july of '16. and it's a spike we did visit it intraday this week, but then we closed 12 basis points above it. the point of this discussion is, is that if we keep holding this, the next big test isn't where the support is, it's the fact that we need to at some point get to that level. and if we don't get any closer to that level and this gets violated to the downside, then this becomes a major objective that i can't see any way around. certainly, we're going to stop at 155, 151, 147, but ultimately, this is the big number so the yield curve has been flattening, but if you look at 30s minus 10s, it's close to the steepest it's been since about mid-2017 so that spread is going to end
up being the best technical support on a yield that you're going to find. and ultimately, if it gets violated, what you most likely want to do is concentrate on yield spreads like 5s to 10s or 10s to 30s because obviously, there's going to be some big moves there the short end, it's all about the fed. and i know that the fed thinks they want to lower rates, because the rest of the market is pressing them to do so. but the bigger fish to fry is to try holding in as long as they can. if a recession is coming, they need ammunition. you start giving these things away, the belly of the plane gets ever so close to a catch and gravitational pull negative rates back to you. >> rick santelli, thank you. dropbox out with its q2 results after the bell yesterday with the stock falling this morning on slowing revenue growth our own deera bosa is at dropbox hq sitting down with ceo drew houston in an exclusive interview. deirdre, take it away. >> thanks, morgan and the losses in the share price has been
accelerating today if it keeps these losses, it will be on track for its worst day since the ipo. to talk more about this and perhaps make the case why it shouldn't be down so much, drew, thanks so much for being with us today. after salesforce, dropbox was the second fastest software company to hit $1 billion since founding, but since you guys have gone public, your rate of growth has been decelerating some analysts are actually questioning whether dropbox is actually a high-growth name anymore. tell me first why growth has been decelerating, the rate has been decelerating. >> well, we're operating at bigger scale than we were when we talked about that a couple of years ago. and we're still growing. we had a good quarter. we beat expectations we actually raised guidance for the year so there's still a lot of good stuff in there and obviously, we're very focused on growth and more is better and in this quarter, we've also been focused on the product
front. we launched the new dropbox, which is the biggest change we've ever made to the experience and the new dropbox helps you organize your working life across all the different productivity suites and tools that you're using. so we still have a huge opportunity in front of us now, the goal for drop box is to get more users to pay for the product, but we actually saw the slowest growth in paid users since you guys went public as well tell me what's behind that and how you get that rate up again >> i think it's -- the -- we focus on both growing number of subscribers and the amount of revenue per subscriber those are going both going to fluctuate at any given time. and we're operating at bigger scale. but what we're focused on with the new drop box is solving new problems for our customers so if you go way back, the problem we were solving for people was like, hey, i forgot my thumb drive, i don't want to have that problem anymore. and the problem we see now and the big growth opportunity for us is the experience of using technology at work has been
really fragmented and overwhelming and i think we're all kind of suffering from this information overload and we don't see our industry -- we don't see anyone solving that problem. that's a big opportunity for us and that's what the new dropbox is about >> in terms of workplace collaboration, you don't see many others solving that -- >> we see a lot of people adding more stuff we don't see anyone pulling it altogether >> i would ask then, what about microsoft? and how you think of the competitive landscape? because it feels like to me, they are making a big push into this space with one drive, it's free it goes in with 365. integrating it with 365. so how does drop box continue to compete and do you not see that as trying to go down the same road as you guys >> i think microsoft will do a good job of keeptrack of microsoft stuff. but the reality is, when we talk to our customers, everybody is using everything they have power points, but they have google docs and they're using slack and zoom and dropbox. and then you have a new challenge, because microsoft will not help you pull all of that together.
you're not going to see support for google docs in one drive anytime soon in fact, you're not going to see any cloud support in general in one drive or not right now and that's what the new drop box is about we've moved beyond files right now you've only been able to put files in your dropbox and evolved the experience from being this magic folder to this magic work space, where you can have your powerpoints next to your google docs, next to anything you have. and it's a more engaging experience it's this living work space, where instead of just seeing a list of files, you can see people and activity, you can slack people >> and you've made some really interesting partnerships over the last quarter you reference the new desktop app, which has some of the hottest enterprise companies right now. slack, zoom. how did that come about and what makes -- what do you think is going to make users come to dropbox versus slack to use dropbox? >> when we watch our customers, what we saw is that they're
using both, but constantly having to toggle back and forth. and more broadly, people are having to toggle between dozens of different apps a day. and that means you're constantly cutting and pasting and it's not an integrated experience and so historically, we've been limited because you just use dropbox within toerhe operating system in the background now we have an entirely new foreground desktop app where you can see all of your content, but i can slack you from dropbox i can start a zoom meeting with you from dropbox the benefit is you don't have to keep going back and forth between different apps it's a much more integrated experience so the integrations help you move back and forth seamlessly as if we were all part of one suite. >> but communication has become so important ways going to make people go to dropbox to use slack versus the opposite >> well, you have to think about, what are people talking about? right? and the fact that we focus on content is actually one of our biggest advantages because so many work flows in the company revolve around
content. when you think about, what are people talking about in slack? it's often a document that lives in dropbox and the new dropbox helps you bring -- instead of that conversation happening over here and the content being in dropbox, we bring those together we're bringing the context and the conversations around content in one place, so you don't have the switching back and forth >> now, you've raised prices on your plus plan a few months ago. and this quarter, we didn't see as high of growth in those paid users. was it the right time to do that how are you seeing this playing out for the rest of the year >> we added a lot to our plus plan, too. so we doubled the amount of storage. we made features like smart sync and others that have been really available. and our first tier paid plan so in conjunction with the price change so, we did that because we realize we're creating value for our users. this sort of short-term pain are you going to see your paid users increase at a higher rate
later on is that what you anticipate? >> it's all performing according to our expectations. we don't expect to see a lot of pain from this we think it will be good for us and good for users >> you did ipo more than a year ago now, at $21 a share since then you guys have really traded around $21 a share what are investors maybe missing here especially when you see others really take off. >> well, to me, it's really that -- i mean, there's a lot of -- we've -- we had a good quarter. we beat -- we've been beating expectations consistently. we've been raising guidance. but to me, what it says is we have more work to do to educate investors on our hybrid model, which really combines some of the best elements of consumer internet and the conventional enterprise software, but doesn't look quite like each other one the benefits combined are really a profitable and scaleable model. you can see that in the numbers. but we have -- we've got to help people understand that and help people understand why we're so
confident about our future >> right now, i remember covering you guys when you were going public and you were really talking about having this consumer model and this viral adoption to get enterprises onboard. are you still seeing that has the strategy, the sales strategy changed over the last year or so >> no. that model has worked really well for us since the beginning. and that's how we reach hundreds of thousands of business customers. is by people using dropbox at home, bringing entitle work, and you start using it as a team and a team becomes a department and a economy. it's a super efficient and scaleable model, because it doesn't mean we have to rely on a huge army of salespeople our users spread the product for us >> that successful in getting you some of the bigger enterprises? can you give us any color about the breakdown and whether you're getting not just small and peemd, but really large corporations onboard with drop box? >> 80% of our 13 million subscribers are using dropbox for work and they're in compa companies of all sizes and we certainly have -- at this
point, we have a bunch of 10,000 deployments. but all of them started as someone bringing dropbox into work and it expanding from there. >> drew, thank you very much for being with us today. guys, back over to you in new york >> deirdre bosa, our thanks to you. shares of dropbox are down about 3% still more to come on uber and our exclusive interview with dara khosrowshahi. stay with us with sofi, get your credit cards right- by consolidating your credit card debt into one monthly payment.
i'm scott wapner here's a look at what's coming up on the "halftime report" at the top of the hour. the note making the rounds that wall street is talking about the author who says stocks are heading back to their new highs is with us live. plus, uber wrecked today tha that stock getting hammered. and liz ann saunders on what she's telling clients today after wall street's wild week. mike, we'll see you in a little less than 15 minutes we're looking forward to it. >> same here, scott. thank you. that wild week kind of continues here the s&p 500 and the dow, nasdaq, all trading pretty much at the lows of the session. s&p is skirting that 2900 level, down about 1.1%. the nasdaq down 1.5%, about 75 to 80% of all volume to the downside so giving back a real good chunk of yesterday's bounce. "squawk alley" is back after isui bakth qckre (vo) the hamsters, run hopelessly in their cage. content on their endless quest, to nowhere. but perhaps this year, a more exhilarating endeavor awaits.
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welcome back to "squawk alley. we've got some movers to get to on the nasdaq, which is currently down about 1.4%. seema mody has more. seema? >> hi, morgan, on a percentage basis, the nasdaq is underperforming the dow and s&p 500 down nearly 1.5% we started to drift lower after president trump's latest comments suggesting u.s./china trade talks may not happen and the sector with highest exposure to china, semiconductors, started to move lower, lower really across the board. so there's still that sharp reaction we tend to see in the sector when trade concerns rise to the top of the list but there are other pockets of
weakness large-cap tech names, despite good earnings, two weeks ago, facebook, amazon, and apple are all lower. and beyond meat, just take a look at that stock shares are also down, abandoning plans to enter the japanese now it's about .5% but according to reuters, they are reporting that matsui, which has a small stake in the plant-based burger maker, said that a joint venture plan is no longer in the works with beyond meat back to you. >> all right, seema, thank you very much. less than half a percent moving beyond meat a very tame day. getting the market back at hq, leslie picker has it >> this is on the biotech giant, plunging 40% worst performer of the s&p 500 down 32% right now, and its earnings call last night, the company disclosed there were manufacturing issues involving with two experimental canc er
drugs. those drugs were distributed to patients in a trial. >> nektar has been down heading into earnings but is down more than 66% now over the last 12 months guys >> all right, thanks a lot leslie picker at hurngs. taking a check on the markets. we're off the session lows we have technology and small caps as the worst performing 'lta mab far wel lkore out the markets after this quick break ye in your family is different. there are so many of us doing so many different things. (vo) that's why verizon lets everyone mix and match different unlimited plans. sebastian's the gamer. sebastian. this is my office. (vo) and now with more plans, everyone gets what they need without paying for things they don't. new plans start at just $35. the plan is so reasonable, they could stay on for the rest of their lives. aww, did you get that on camera? thanks, dad! (vo) the network more people rely on gives you more.
the past half hour or so just off session lows, but s&p 500 down by 1.1% nasdaq down by 1.4%. among the worst performers within the nasdaq and technology, chip stocks. micr micron, skyworks, amd, all in the red here the president telling reporters earlier the u.s. will not do business with huawei >> we're not going to do business with huawei we're not doing business with them and i really made the decision it's much simpler not to do any business with huawei so we're not doing business with huawei that doesn't mean we won't agree to something if and when we make a trade deal
but we're not going to be doing business with huawei >> bob pisani is here with us at post 9 we have that comment we also have on the table now the possibility that trade talks in september could be canceled >> yeah. i'm a little more optimistic about this than most people. i know that's the central question, are there going to be more tariffs on september 1st, but in my mind, seeing the chaos that we have seen in the markets in the last week, partly due to the fed instituting a global round of rate cuts, but largely because of the new tariffs, the easy thing to do is do what i call truce part 2, and essentially just push the whole decision out on the tariffs again. i don't think that that's a very hard decision to make. i also don't think there's a huge constituency that wants more tariffs >> what's the catalyst for truce part 2 >> the market chaos that ensues. i think that's an issue and it's been clear this week that the market is concerned about an additional round of rate cuts. >> until yesterday, we actually
bounced completely on the s&p as well as the nasdaq in turning positive for the week, and today, if i said, bob, what if there were a headline that said the u.s. might cancel trade talks in september, what would you say the market reaction would be down 1%? probably deeper. >> i think the market is starting to believe there's a better than even chance that the tariff cuts will be pushed out >> the whole question tends to be, how much wear and tear on the global economy or how much sentiment about growth gets affected to me, the whole bond market buying panic you see and the yield collapse, it isn't just necessarily all about tariffs but it feeds into the story line that we have jeopardy for the expansion in general we're not seeing the u.s. pulled down in the vortex, but ahead of a weekend when who knows what's going to go. >> the one thing i do, because i have watched the earnings picture. in the last couple weeks, the earnings estimates for the third
quarter for the trade related sectors have been coming down quick. industrials, materials, energy, and banks. those numbers have been coming down faster than the overall s&p earnings estimates have bing coming down. and that's a sign right now, you know, we saw this this week. we talked about it, we had tobias on. he was the first top-down guy to come on and take his numbers down about 2% for 2019 and 2020. goldman did it last week now the bottoms unguys, the analysts who do the individual stock analysis, are starting to catch on to the concerns here and i think those numbers are going to be cut more and the market is going to have to deal with that, if the september 1st tariffs become real. then the cuts are going to come fast >> caterpillar is trading down another 2% today matt miller pointed out to me if you see it move below its late may, early june closing, and stay there, close there this morning, then that could be another rough signal about the
global economy, and certainly we're seeing some of those pain pockets in places like industrials right now. the other key question to all of this, though, is what happens with the fed >> yeah, and i think there's a certain new round of anxiety about what the efficacy of a future round of global rate cuts will do to help prop up the global economy obviously, it worked, may not like it, but it worked in the last ten years it's not clear if suddenly there's a massive new round of global rate cuts we're going to get the same response, particularly being in negative yields throughout europe right now. i think there's another additional overlay of anxiety about that this is a lot. when the two biggest things that move the market have happened in the last week or so, people say why is it so weird in august well, global round of rate cuts and new tariffs coming in. that's what's moved the market all year that happened in the last week of course, the markets are going to be crazy. >> the s&p touching 2900 right now. more or less giving up most of yesterday's rally. down only about 1% on the week 4% or so from the all-time high
in the s&p it seems like it's been this massive turn, but it's mostly just kind of a shake out at this point, at least in the index level. >> you look at the stuff that's moving today retailers are really weak. particularly the retailers that import a lot from china. huawei suppliers are all really weak one group where pointed out benefitting is exchanges are at new highs. cibo, which controls the vix contract, cme at a new high, all that volatility is benefitting those exchanges but that's one of the only groups we move in relation to the ten-year yield and it's rather remarkable today. yield down, market down. >> 2900. what do you think is the next low, 2822, that was monday >> give me the multiple for the markets. we were at 17 sxvl, almost 18. forward multiple now, two weeks ago. if the market decides that global growth is going to be significantly lower, it can take that down easily to 16
so you can go to 26, 2700 very easily >> more tactically, 2820 or so is where we hit the lows this week for this move >> all right, bob pisani, thank you for joining us that's going to deit for us here at "squawk alley." melissa, mike, thank you for joining me let's get to scott wapner and the half >> thanks. front and center, the wild week for stocks what it says about where your money will work best in the months ahead it's 12:00 noon. this is "the halftime report." >> big swings in the market this week has investors wondering what to do with their money. one wall street strategist says stocks will likely regain their previous highs that live interview is next. >> plus, semis fall after president trump says the u.s. is not going to do business with chinese telecom giant huawei we'll trade those names and what it means for the tech sector "the halftime report" with scott wapner begins right now. >> welcome good to have