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tv   Street Signs  CNBC  May 2, 2017 4:00am-5:01am EDT

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. good morning. welcome. you're watching "street signs." i'm carolin roth. these are your headlines. a first quarter comeback for bp. the british oil major beats expectations posting replacement cost profits of $1.5 billion, supported by a better crude price. shares of ocado deliver, up more than 8% on a report the company is considering a tie up with retail giant marks and spencer that could see the grocer launch an online food delivery service. discount downside for luxottica. the world's biggest eye wear maker misses first quarter forecasts as its curb on promotions weighs on sales.
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powerful pmis. the european manufacturing sector powers on with german and european pmis hitting a six-year high. good morning, everyone. we're back from a long weekend. we have plenty of data to get through. want to tell you about the eurozone factory activity hitting a six-year high in april. the eurozone final factory pmi is at 61.7. inflationary pressures stayed quite strong. let's tell you what the european markets are doing. we're higher to the tune of a quarter percent. euro/dollar at 1.0904. let's look at the european markets one by one. what we're seeing is that -- if
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we can swap on to the indices. we are broadly higher across the board. the cac 40 up by a quarter of a percent. ftse 100 up by two-thirds of a percent. the xetra dax inching higher to the tune of 10 points. let's get back to the bigger stories. ocado shares surging to the top of the stoxx 600 on reports of a tie up with marks and spencer. better than expected numbers are lifting aberdeen asset management and bp. let's show you what the sectors are doing. energy is getting a boost from the bp numbers. oil and gas up by a half of a spent. real estate up by a half of a percent. on the down side. basic resources, seeing a bit of pressure, chemicals and autos also under pressure. let's get back to weekend news. president trump has renewed his vow to consider breaking up america's big banks. when asked by bloomberg news when he would re-evaluate his
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campaign pledge, he said he's looking at that now. major u.s. averages slipped on the comments but later rebounded. u.s. treasury secretary steven mnuchin says the upcoming tax overhaul will eliminate all loopholes with the exception of charitable giving deductions and mortgage interest. in an interview, mnuchin reiterated trump's promise to provide relief for the middle class. >> our focus is on creating middle income tax cut and simplifications. as i said, a lot of the reduction on the high end is going to be paid for by eliminating deductions. in many cases, peoples effective tax rate won't go down. that's something, again, this is about creating jobs, this is about creating economic growth. >> cnbc also spoke with wilbur ross who accounted for the administration delay in a nafta
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renegotiation process. >> the reason we have not had the formal negotiations on nafta is simply that congress has prevented us from doing so. it's hard to blame the president for something outside of his control. >> let's talk about all the weekend news with thomas harr, of ficc research at danske bank. he joins us from copenhagen. the president also telling cbs he's looking at an infrastructure plan to come out within two or three weeks. do you think this is largely cosmetic along the lines of what we saw with the tax overhaul, just a big announcement and not major details? >> i think you're right. the beta to what trump is saying is going down because we're used to these big comments and not much has happened. for us here, we're looking for fiscal stimulus whether it's tax
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cuts, infrastructure, hitting the u.s. economy in the second half of 2018. so that means we have a u.s. economy doing okay, but not big growth. >> it's interesting, ben bernanke was on the record saying he does not see the u.s. economy growing faster than 3%. then we heard some comments coming from the trump administration, i think that was mr. mnuchin also saying, yes, it will grow above 3% thanks to the tax reform and the infrastructure package. which camp are you in? >> i'm more in the less hawkish camp. i think it will take a lot for the u.s. to go to 3% in terms of growth. maybe second half next year if they get all that fiscal stimulus, you could get to something like 2.6, 2.7. we have to remember growth in the u.s. has come down, we're probably close to slightly above 2. even 2.6 and 2.7 is high. it's above trend. we have an upward gap which is more or less closed. it's important to remember the
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fed signaled they have to counter act fiscal stimulus. i think we should be careful not to be carried away in terms of expecting too much here in terms of u.s. growth. >> we did see weakness in the u.s. data points yesterday. weaker than expected factory output, consumer spending was unchanged. inflation pce number was lower than anticipated. do you think this is something we should look through and we should not necessarily adjust expectations when looking at the upcoming june fomc meeting? i know this week nothing will happen. but in june the fomc might hike rates. >> in terms of data, we are seeing softness in u.s. data and china data finally. we think the global industrial side is rolling over for the next three months. in terms of the fed, we think they have signaled clearly they will make an announcement around the balance sheet in june
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meeting. our call is that they may only go in july. i think you can say despite the softness in data, the old story is that central banks are reluctant to become too dovish in this environment, clearly the fed wants to get going with the interest rate or balance sheet tightening. that you will see playing out despite a bit of softness in the data. >> what are you expecting for the all-important jobs report this week or is it not all-important anymore? we saw aberration in the march number. do you think we'll see a big reversal here? >> i think you'll see reversal. is it very, very important for markets? i doubt so. we have seen some softness in the data. gdp is likely to be soft in q1. we are seeing also softness in china, which is very important for the global economy. so i think in terms of fed policy, i think they like to get going on this balance sheet tightening and eventually raise interest rates. i think they'll do that, whether
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you have non-farm at 90, 140, i don't think it matters that much. >> what do you do with the dollar index in the medium term? >> in the medium term, clearly the dollar is close to a peak. we will see dollar weakness over the coming one to two years because the fed is ahead in the cycle. europe is catching up. and other countries are also catching up. short-term, we could probably see a bit of dollar strength again because i think the fed is underpriced. medium term, the dollar is close to peak. strong levels to g 10 currencies and emerging markets. >> thomas, we will continue this discussion after this short break. we're also going to talk about the euro and what we should be doing with the common currency in the run up to the second round of the french elections this sunday. thomas harr from ficc research at danske bank sticking around. get your e-mails in.
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your questions are always welcome. and you can find us on twitter, streetsignseurope@cnbc and tweet me directly @carolincnbc. i love reading your tweets as always. still coming up on the show, as mateo renzi wins back the leadership of the democratic party, we'll have the latest on his return to the front line of italian politics.
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all right. let's get to some corporate news. marks and spencer and owecado a considering a tieup. marks and spencer could be launching a grocer delivery
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service. look at ocado. it is soaring on the back of this. up by 8.73%. bp's key earnings measure, replacement cost profit, came in at 1$1.5 billion beating expectations and stronger than last year. the oil major maintained its dividend at 10 cents a share and says it expects organic capex to be 15 to $17 billion. luxottica sales fell in the first quarter hit by a new policy which reduces online discounts. salt sales increased by almost 2% as growth was offset by weak consumer spending in the u.s. bovis has said it will incur a 2.8 million pound hit in relation to the two failed merger proposals from read row and g galliford. they say the company will
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deliver on its 2017 guidance. aberdeen shares are rising after posting first half results. the british fund manager reported more than a 10% rise in revenues helped by market gains and cost cutting. shares up by a little more than 3%. one of the world's biggest asset managers, alliance bernstein fired its ceo peter krauss and overhauled its board. kraus was terminated from both roles and 9 out of 11 directors were moved. the money manager has come under pressure along with the rest of the asset management industry and has seen tough competition from rivals like blackrock which offer more passive investment products. european data is showing strength after a strong pmi number from italy, spain, france, germany. both the italian and french manufacturing pmis hit six-year
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highs, german pmis also hovering near the six-year mark. let's get back out to thomas harr from danske bank still with us from copenhagen. if we look at euro/dollar, it seems like it's fully pricing in a macron win. do you think that's justified? >> i think it's right. it seems most likely that macron will win given the lead he has in the polls against le pen. i would say that if he wins, the market reaction should be relatively muted. up to a half figure, so in euro/dollar, because it removes a bit of that uncertainty and a rally in french fixed income. but the market reaction will be muted. i think what is interesting is that we're seeing this european data turning up, we're seeing chinese and u.s. data weaker. >> does that mean more upside for the you're rov when it comes comes to other currencies? >> i think so.
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i think the fed underpriced a bit at the moment. that will tend to support dollar on the short-term. but the more medium-term outlook for the euro and euro crosses as such is for higher euro. clearly the european economy is getting out of the crisis we've had for several years. >> thomas, i'm sitting here scratching my head. we've been through years and years of political crisis in europe. it doesn't seem like there's an end to it. we see more elections this year. yes. the french election may provide a euro positive outcome, but there's still the uk general election, the german elections. do you not think the euro/dollar should be showing more signs of nervousness right now? >> i don't think so. the french election may be a positive for the euro. if macron wins, german election is a nonfactor. both are pro euro. then i would say,say, yes, you
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an issue for greece, but it doesn't matter for the currency. you are right about the brexit, but that's well known about markets. the euro survived a lot of storms. i think it will survive the ones we've seen over the last one to two years. if anything, the political dynamics over the last three months will be supportive of the euro. >> what's your target for euro/dollar then? can it sustainably go above 1.10? >> i think it can. our forecast is 1.14. we will not break parity. the risk to the upside. we will go back to 1.20 or 1.30, but it's a matter of how long of a time it will be before we go there. >> it seems like those calling for parity just a couple weeks ago that seems like a long time ago. thomas harr from ficc research at danske bank. let's turn our attention to
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italy. italy's industry minister said the collapse of altalia would be a shock to the country. rome offered up to 400 million euros to keep the company afloat while an administrator decides whether the airline should be liquidated. and matteo renzi is back at the helling of the centm of the. willem marks has been covering that story and joins me now around the desk. how much credibility does renzi have left after the referendum he said i'm leaving if this is against me. >> he has a lot of critics on both sides of the political spectrum, after a much larger pd party that he now runs.
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quite a few dissidents moves away from his center-left ground, the left wing side of things. they say he lost a huge amount of krcredibility. they say that decision haspeoplf renzi. he is taking control of a party with a much smaller base of support. the challenge for him is to try to unify the different forces on the left. >> five star movement is the main challenge ser running at 29% when we look at the most recent polls. i guess renzi will have to build strong alliances to go up against that. do you think that's feasible? >> i think the alliances are a feasible thing based on the fact for the five star movement they're less likely to find coalition partners they would need to form a majority. that's a challenge for them. they've been isolationists politically, domestically and in terms of the european union.
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they've been critical of the eu throughout their movement. renzi put the eu at the heart of his campaign. it's a popular platform among him, however things like air italia, job creation and the job deficit will be tricky to navigate and maintain that unified support from the left wing. >> never gets boring when it comes to politics in italy. what's interesting is some similarities we're seeing to france. for example, one of the slogans that renzi used in the primary campaign is, i believe, the italian equivalent? >> on march. >> do you think he can capitalize a bit more on that momentum that macron is receiving? >> he has a difficult path to tread. the five star movement, very critical of the european union, called for referendum on membership with the euro. he put europe at the heart of his campaign the last few days, ended up in brussels. he has, when he was prime minister, been quite european
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over migration, italy's deficit, the european union pushing for italy to reduce that deficit to stay in line with their rules. one thing he will have to do is show he cares about europe like emanuel macron and wants to be a big part of what he sees with italy's future but without pandering too much to european br bureaucrats. >> what pops up time and time again is the specter of early elections. do you think there's reasonable chance we'll see that happening? >> realistically the process by which that would happen would be quite an awkward one. he would have to say to paul ol gentiloni i will withdraw support of the pd, your own party which put new this position to succeed me to have the president dissolve the parliament. now, there would be political reasons why he might do that. that would do with polls. if he looked like theresa may, if he looked like he was doing well against the five-star movement in terms of likely
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voters, he might think now is the time to pull the trigger but it's a lot of explain doing from him to show why this is a good time. >> whelm maell wig willlem, tha. hadley gamble spoke with the head of middle east in central asia and asked whether he thought egyptian president cici was guiding the country down the right path. >> the program has been running for six months. the impact was positive. confidence came back. investment came back. we are seeing certain numbers of positive signs. the parallel exchange market disappeared. there are still reforms to be implemented. some of those are fiscal reforms.
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in addition, inflation went up higher than planned. and this is something that needs to be addressed. >> how do you think they should go about addressing it? are we talking about higher interest rates? >> addressing it by using the biggest fiscal instruments as well as also monetary instruments. >> so higher interest rates? >> definitely all the instruments need to be put into the equation. i think what is important is to understand why we need to curb inflation. inflation is negatively affecting the social situation. it is putting pressure on fiscal and on deficit. the risk is that we have a second-down effect. for more on this story, you can head to all right. we'll go for a quick break. do check out world markets live, our blog which runs throughout the european trading day. we have more data in the form of uk pmi data after this short break. stick around.
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hello. welcome to "street signs." i'm carolin roth. these are your headlines. a first quarter comeback for bp. the british oil major beating expectations supported by a better crude price. shares in ocado deliver on more than 8% on a report that
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the company is considering a tie up with marks & spencer that could see the grocer launch an online food delivery service. pension cuts and tax increases make up a long-awaited reform deal between greece and creditors that should pave the way for debt reduction talks. europe's manufacturing sector powers on with german and french pmis hitting a six-year high. good morning. if you're just tuning in, here's a quick look at u.s. markets. the s&p 500 seen off fractionally by three points. the dow jones seen off by 35 points. the nasdaq set to fall by five points after u.s. markets were trading yesterday. we did see a mixed start for u.s. markets in the month of may. the maz dak closing at a record high. it was fairly narrow trading
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with light volume. the dow in the 78 point range. we have plenty of earnings to get through today. among them apple the hv heavyweight. let's show you what's happening on this side of the pond. the ftse 100 is up by a half of a percent. you have the likes of aberdeen doing better on the back of an upbeat update from them. the dax up by 10 points. the cac 40 higher to the tune of 0.2%. bp out with first quarter numbers, which you heard in the headlines better than expected. when it comes to the sectors, these corporate stories are reflected in what the sectors are doing. oil and gas up by a half of a percent. basic resources suffering a bit despite a fairly solid iron ore pricing we're seeing in australia, off by 0.9%. chemicals and autos underperforming. let's get to the fx markets. currencies looking like this. we are seeing the dollar/yen pair close to a one month high
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at the 112 level, up by a quarter of a percent. the dollar got a booth from mr. enou boost from mr. nuch enou mnuchin. pmi numbers coming out of the uk, and there you go. uk manufacturing growth spiking to a three month high in the month of april. we're seeing sterling rise against the dollar on the back of the better than expected manufacturing pmi. pmi 57.3 versus a march number of 54.2. we were expecting a dip for april. so this is a very surprising, very good report given that over the last couple months manufacturing pmis have been
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softening contrary to what we see and hear on the continent so what we're seeing in april, that's the highest print in three years. we're seeing new orders, the highest since january 2014 with very strong export order growth as well. that confounds expectations, that's why you see the nice pop in pound sterling. we are seeing this level at 1.2901. now, the greek finance minister said the country has reached an agreement with eu and imf leaders on its -- lenders, rather, on bailout reforms. speaking after a marathon round of talks, he said there is white smoke. nexus on at negotiations on all have been completed. the esm said in a statement that the deal, which includes pension cuts and energy market reforms now paves the way for discussions on debt relief. the french presidential
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candidates have attacked each others records at may-day rallies ahead of the final round of voting this weekend. the person covering this is claire fournier, she is still in paris. claire? >> yes, good morning, carolin. the talk of the week here is the weakening of what we call the republican front, which is traditionally that the front national goes to power. the republican front is the unity of all leaders from all parties that call for voters to vote against the national front candidate, same as what happened in 2002 when jean marine le pen, father of marine le pen, made it to the second round. but there's no such thing in 2017. the first one to break the rule was jean-luc melenchon, leader of the far left who did not endorse emanuel macron. you can see the same thing also with the trade unions which marched yesterday.
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the third trade union in france, and first among the public offices in france, and we have the marjorie with us this morning. the unions did not march altogether like they did in 2002 yesterday. has the context changed. >> good morning. the context has changed, of course, since 2002. i would like to recall that in 2002 all the unions did not march altogether. may 1 st they're used to marching, so we are deeply attached to our independence. and as usual, we don't call for anything in -- we don't give any voting recommendation. >> but the unions in france represent 11% of workers and
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employees. don't you have a responsibility to avoid among everything abstention, which is probably going to be very high in the second round? >> we think that we -- we are -- sorry. we don't -- at first of the year, what we think is that we are here to defend the workers particular rights. we are not here to defend the rights of the nation, the general interests of the nation. >> so you don't want to get involved in politics? >> no, of course we are involved in politics when we are dealing with ministers, but then we are dealing with ministers when we are elected. we are not interfering in the votes of our -- of the citizens. >> getting back to marine le pen, she presented herself as the candidate of the people and the workers.
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indeed at may 1st, 24% of your supporters and militants vote for the front national. how do you explain that? >> it's quite easy to explain when you look at where -- which areas the national front is present. there is correlation with where first of the year is present. for example, most of therine le workers and among public officers. we are the first in the public officers union. so, there is this correlation. as a union we're quite representative of the nation. not of the nation but of how the nation is organized. it's not a surprise. the national front is also present among the other trade unions in france.
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>> yes. but what is striking to me is that she's very against unions. and says employers unions, employees unions, it's the same thing and part of the system. of course she's really anti-union, but we don't have to express on marine le pen as don't have to express on emanuel macron. it's the choice of the citizens. it's not the choice of unions. >> thank you very much for this testimony. emanuel macron or marine le pen have both tried to appeal to workers. there's a sense that if the centrist candidate is elected there will be trouble in the streets and with the trade unions because he wants, for example, to go further with labor law, against which a lot of trade unions in france protested when it was implemented. a lot of debate to come after this election. for the record, tomorrow night
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there will be debate. the first televised debate eye to eye between emanuel macron and marine le pen. that's the last chance for the french vote horse are stirs who undecided to make share choice. >> who do you think is the better debater, if you will? >> you have two very good debaters. marine le pen tends to be aggressive. and macron seems to be softer, but when attacked can get pretty aggressive. that is for the way they will address each other. but in what concerns, you know, the themes that probably will be part of the debate, she will make sure that she describes him as the candidate of the system, since he was a banker and also part of the economic advising team of francois hollande, also minister of the economy. and he will attack her on being
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a danger for democracy, but also the advocate of frexit. even though she toned down her speech on frexit these days, because she knows it scares off french voters, you can be sure they'll attack her on the confusion that the front national has shown around these topics of euro. back to you. >> claire, appreciate that. let's get back to the market reaction to the french elections. we've seen plenty of reaction in the government bond markets, a bit in the fx, but european credit. let's talk about that with the head of european corporate credit of alliance bernstein. off the start you say the credit market is ignoring the political risk. why do you think that is? >> looking at the market now, we're looking at a rate height investment market. we are look at a market has leaves little room for anything else other than a macron
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victory. after the first election round, credits tightened and the french names are trading at levels that we saw at the beginning of the year. from an investor holding french risk there is a less compelling market to look at bonds and credit bonds. that has been driven to some extent by ecb buying 2, 2.5 billion every week of corporate bonds. >> do you still think -- i know the ecb is a much bigger factor, do you still believe macron is the winner, do you not believe we could see a rally in european credit markets? >> yes, we will see a small rally. we'll see it in the french credits and broadly. i'm saying the symmetry in that trade, it is certainly calling for high conviction in macron to win. you can find value elsewhere in
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the credit market that is not quite as highly strong to plaa e macron victory. >> the ecb, what happens once the ecb pulls back support? that will happen eventually. probably sometime in 2018. do you think we'll see a major taper tantrum? >> you can look at the u.s. market 2013 and i think the market has learned from that. we will not see the same reaction that pronounced reaction we saw in may and june. but certainly there will be a question mark to credits that are trading less than 1% in both five-year and ten-year bonds in euro. we will see the european common bonds trade higher as well. we are seeing german yields at the moment in a ten-year spot at around 33 basis points, very, very low yield. >> that's not very much. you suggest instead of looking at investment grade, one should
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look at high yield. why is that? what's the rough yield there? >> you can construct a portfolio and get 3.5%, 4%, that for me is a bit where you move away from the duration risk. you look at corporate risk. pmi numbers are strong. the fundamentals across europe show very, very strong. so i wouldn't be afraid of looking at the bond market in the more subordinated space, like bank bonds. >> bank bonds, that's something that the ecb is not buying now when it comes to european credit. when the ecb steps back from corporate bond buying, and when we do see a continued normalization of rates, is the place to be in bank bonds? >> yes.
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>> why? >> when you look, we get a steeper yield curve it will benefit the banks. we are seeing much better results out of the most solid banks in europe. and that certainly will mean that the spreads in the bank bonds will tighten more than they will in the corporate nonfinancials. and when you look how much that rally has been driven by ecb, in the nonfinancial part, it has to fade and that's why i would like to go much more into the financial part. >> what extent does it worry you when you look at that compelling investment opportunity of buying into bank bonds that in the u.s., for example, but also here in europe that reflation trade pushing up, treasury yields pushing up, yields overall has reversed somewhat. does it not take away the argument to buy the banks and to buy anything bank related? >> not in europe. we sit in the cycle that
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benefits very much the european banks. >> thank you very much for that. appreciate it. still coming up, apple shares, they have hit a record high ahead of results today. find out what's in stores for the earnings release and whether the world's most valuable company can retain wall street's affections.
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time to talk about apple. shares in the company hit an all-time high. the stock up 25% this year ahead of the second quarter results due today. how the world's most valuable company is allocated its cash mountain via buy backs and dividend, that could overshadow details over how many iphones it
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is selling. joining us is arjun kharpal what are you expecting from the small smartphone numbers. sales expected to grow. do we actually care about that? >> i think investors are seeing this as a flaunnonevent. we will see modest increases of iphone sales over this quarter and the next quarter, but it's about the new iphones coming later this year. three new models, one of those a special edition, anniversary edition packed with all the latest technology, which will drive what analysts are seeing as a super cycle in iphone sales, double digit growth in the next fiscal year. that's what analysts are looking for and are expecting. any noise apple will expect from the new phone as well. >> as you indicated there, all the focus is very much on the capital return story at apple, whether it's an increase in the share buyback or a special
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dividend. that, in turn, depends on donald trump. >> absolutely. everybody is looking at the tax plans that are soon to be announced or expected to be announced which could see the repatriation of cash rate drop below 10% that would mean a lot for apple's 2$250 billion cash pile. 90% of which is sitting off shore. if some of that cash gets repatriated to the u.s., the hope is this will be returned in the form of a special dividend back to investors, which would make them happy. >> 90% of that is sitting off shore. that's a huge pile. i guess everyone is really hoping -- rubbing hands, hoping for that special dividend. want to talk more about apple services. that is the service they're hoping for in the future but margins are low. how do they make sure this is the key revenue driver as the hardware side of the story maybe seems to lose buzz? this is a younger business overall. apple started selling these services a bit more recently.
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things like apple music which has around 20 million paying subscribers. apple pay as well. i think the idea is as ap continues to roll out its hardware, and the base of iphone users, which sits at about 700 million, begins to increase and continues to increase, the new users upgrade that apple will sell newer services. apple talked a lot about content. content is a big area for apple. they're investing heavily in that not just in the music side but on tv shows as well. apple will hope some of those 700 million users latch on and pay for additional services. that will boost margins in that business. >> speaking of content, twitter had big news out over the weekend. what do you make of that? >> the thing i fear with twitter, they will launch themselves into a content spending war. everybody wants to talk about content now. apple, netflix, amazon, the traditional content providers. that means that twitter could set itself up to clash with some
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giants who have much deeper pockets, and also with investors willing to tolerate spending. something that twitter does not have the advantage over. that's one of the key fear force m fears for me. >> that's twitter's last attempt to survive. so they have to throw everything at it. >> really is. this is is a place where they see a niche. people tweet about sports, politics on twitter, they could latch on to that platform, but they have to be strategic. they can't jump into sports rights that everybody also wants. nfl rights is one of them. they clashed with amazon and amazon took that. they have to be targeted. they have to win a decent piece of content and package it up in a unique way and buy the rights
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with it, which other companies can't do. that's where the advantage will lie in the future. >> arjun, thank you very much for that. arjun kharpakharpal. let's get back to the u.s. the federal reserve will begin its two-day policy meeting today. economists are expecting the u.s. central bank to keep rates unchanged, but they could signal a faster pace of rate hikes in the coming months. ben bernanke says the central bank could cut the balance sheet in half. he added that the exit from ultra accommodative policy was going well. >> so far so good. you know, it wasn't too long ago when people on shows like this were saying we would have hyper inflation, huge stock market bubbles, dollar collapse, all kinds of terrible things would come. but it's gone smoothly. the fed is in the process of exiting from easing money. the economy is doing well. the unemployment rate is 4.5%. inflation is close to the fed
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target. all those things are on track. >> cnbc has exclusive results from the fed survey to coincide with the first 100 days of the trump presidency. steve liesman breaks it down. >> reporter: we asked respondents to grade the first 100 days of the president trump presidency. 43 participated including economists, fund managers and strategists. they gave the president an overall grade of "c." his economic ideas a c plus, but the execution gets a c minus. said one participant he's not lived up to the rhetoric. another chimed in so far trump has broken and kept all the right promises. another says we can now clearly see the political inexperience matters. and finally he is having impact without getting what he wants. respondents give high marks to the broad thrust of the president's economic proposals. healthcare and trade both rated negatively by our respondent's.
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healthcare and trade are rated negatively by our respondents. asked specifically about the president's tax cut, 86% it will increase growth. some saying it would increase growth somewhat. 90% says it will increase deficits with 50% of those saying the plan would boost deficits a lot, a sign that respondents don't believe the tax cuts will pay for themselves. steve liesman, cnbc business news. >> president trump renewed his vow to consider breaking up america's big banks. when asked by bloomberg news whether he would re-evaluate his campaign pledge he said "he is looking at that right now." major u.s. averages slipped on the comments, but then rebounded. foreign policy remaining in focus with president trump not ruling out the prospect of meeting north korea's kim jong-un at some stage. peter alexander reports.
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>> reporter: tonight, president trump with this alarming warning about north korea. >> so nobody is safe. we're probably not safe over here if he gets the long range missiles, we're not safe either. >> reporter: that dire assessment after surprising comments to bloomberg news. opening a door to a meeting with dictator kim jong-un. if it would be appropriate for me to meet with him, i would absolutely. i would be honored to do it. no sitting american president has ever met a north korean leader. >> this is probably the most brutal dictator in the world and it would elevate his status well beyond what's deserved. >> reporter: president trump also crediting kim jong-un for being a shrewd survivor, eliminating rivals, including his uncle. >> so obviously he's a pretty smart cookie. >> reporter: mr. trump defending his white house invitation to another brutal leader, president duterte of the philippines. who could help the u.s. isolate north korea even though he is widely condemned for executing thousands of drug suspects in his own country. >> there is a huge human rights component that goes into this. it's a balance. >> reporter: the president also creating confusion at home,
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misstating one of the key changes of the republican health care plan with a vote as early as this week. >> preexisting conditions are in the bill and i mandated it. i said it has to be. >> reporter: in fact, the latest amendment isn't that clear and allows states to get a waiver that would let insurers charge people with preexisting conditions more for coverage. the president tonight arguing the plan still isn't final. punctuating president trump's new round of interviews, this stunning comment about president andrew jackson. >> he was really angry that he saw what was happening with regard to the civil war. >> reporter: jackson himself a slave owner died 16 years before the civil war. >> people don't ask that question, but why was there the civil war? why could that one not have been worked out? >> he seemed to skirt around it when he said why was that one not worked out? that one is slavery. >> let's take it back to the markets. we have plenty of pmis in
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europe. the uk pmi for the month of april. the manufacturing pmi came in at 57.3. that was the highest number in three years. pretty much confounding everyone's expectations. people were expecting a drop to 54. so there you go. we saw a pop in sterling/dollar. but back off those levels now. 1.2891 is the current handle. u.s. fought chores, we are expecting a slightly higher start to the trading session. the dow jones seen up by 13 points. that's it for today's show. i'm carolin roth. "worldwide exchange" is up next. we'll see you same time same place tomorrow. bye-bye. if you want to stay on top of your health,
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good morning. earnings central. bp beats the street on higher oil prices and the being name to watch next -- apple. we'll get you geared up for results. financial shock. president trump says he is considering breaking up the big banks. the volatile trading reaction coming up. and the rise of the wo bot. credit suisse makes a push to replace the man for the machine. that story coming up. it's tuesday, may 2, 2017. "worldwide exchange" begins right now. ♪ >> good morning. warm welcome to "worldwide exchange" on cn


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