tv Worldwide Exchange CNBC June 1, 2017 5:00am-6:01am EDT
good morning. sell many may and go away. a new month of trading coming up. washington watch. trump will announce his plans for the paris climate agreement today. corporate america already weighing in. plus uber unveils its latest financials and says its finance chief is leaving. why the company could be on the road to going public. it's thursday, june 1, 2017. "worldwide exchange" begins right now. ♪ good morning.
welcome to "worldwide exchange" on cnbc. i'm sara eisen. >> i'm wilfred frost, good morning to you from me as well. throwback thursday, we're throwing it back with songs of summer. i can't believe it's june. >> summer. hopefully it starts to feel like summer in new york. it's been not the best spring. we've had a british spring. >> i know. it's memories of home. i bet it gets good as i go to the uk next week. >> hopefully. >> so you hope it will be nice in london or not? >> i hope it's nice here finally. >> and in london? >> yes, for the race. >> noshgts it's t, it's the ele. the dow up a third of a percent yesterday, the nasdaq, up 1%. tech up 4%, energy the worst performer, down about 4%.
albeit oil prices were positive for the month until yesterday's declines. let's look at oil prices. up 1.3% this morning. for the month of may as a whole, down 2%. positivity in the futures market this morning. slight gains, slight rebound. >> so not necessarily sell in may, go away. futures are up. seven months straight for the nasdaq. to the top story, president trump says he will unveil a decision on the paris climate deal at 3:00 p.m. eastern today. the highly anticipated announcement comes as many big business ceos and adviser to president trump have advised him to not withdraw. tracie potts joins us now with what we can expect today. who is actually advising him to stay in? i have not read that part yet? or to leave. >> a lot of people are advising him. lease g he's getting pressure from both
sides. his daughter ivanka and his son-in-law jared want him to stay with this deal. so does the secretary of state, rex tillerson and others in his cabinet. even within the inner circle there are people telling president trump to stick with this. on the campaign trail and even since he's been in office he spoke against the climate deal. steve bannon is sharply against this deal. so he has people on the inside close to him pulling on both sides. on the outside, some two dozen companies, some taking up big ads in papers today, urging the president to stick with this climate deal. on the other hand, you have nearly two dozen senators on capitol hill who sent him a letter saying dump it. he's literally getting this pressure on the inside and from the outside on both sides. president trump very independent-minded will be making his decision later this
afternoon or announcing his decision later this afternoon. >> so that answers the question, he's getting advice on both sides. thank you very much for joining us at the top of the hour as we await that decision. business leaders are making their opinions known about the decision. following reports of a withdrawal, tim cook and elon musk phoned the white house to try to persuade the president to reconsider. musk saying don't know which way paris will go, by i've done all i can to advice directly with potus through others in white house via councils that we must remain. in the end, ceos of 25 companies signed a letter asking him to stay in the deal. it feels like the pressure is on him to stay. even some people you expect to
back an exit, whether it's exxonmobil, chevron, various others suggesting he stay, there would be severe repercussions when you add in all the g7 leaders backing it. >> i wonder if the repercussions will be more symbolic. it's a question of leadership. a lot of these companies, if you go through the letters, marc benioff of salesforce posted one last night. they seem to have the argument that it's about u.s. competitiveness, u.s. jobs, and having a major role among world nations. by the way, every single nation in the world is in this, we would be joining nicaragua and syria as countries that opted out if the united states pulls out of that. that's what president trump promised. he wants to make u.s. business more competitive and create american jobs. his closer advisors, like the ceo of dow chemical who has been a major backer of president trump since he joined the
councils, he has urged him to stay in. wilbur ross says he hopes to complete talks to renegotiate nafta by early january, well before mexico's general election in july. speaking at an event in washington, ross said the trump administration would impose anti-dumping and anti-subsidy charges on mexican sugar and canadian soft wood lumber. the deadline for a mexican sugar deal is june 5th. back to the global markets. in asia overnight, chinese pmi fell short of estimates. hitting an 11-month low. that did not help the shanghai comp. you did see gains across the rest of asia, including the nikkei which jumped 1%. the chinese currency, a seven-month high after the peoples bank of china set the mid point. it's been on a bit of a surge
the last few sessions. at least the off shore chinese yuan which is a statement of strength and the fact that china may want to push away speculators. either way that's seen as good it jibes with a stronger manufacturing number outyesterday. >> the private survey of manufacturing was softer this morning. that's always closely watched. that comes always a day after the public survey, and paints a different picture. that's something worth noting. on currency, i think the issue is pretty clear. over the past three, four months we had seen reserves tick up. we had seen the central bank not have to intervene, which was a positive compared to a year ago. what's happened clearly over the last week, if you look at the interbank rates in hong kong and china, which is there is a lot of government intervention. yes, the currency has risen, but it's because of state intervention. state has been intervening because they got that ratings
downgrade. they wanted to get in there and make sure people don't come out. not because of automatic strength and the fact that they are intervening again is something they hope they won't have to do for a prolonged fashion. either way, nothing is major. the shanghai comp is down a half percent today. nothing too major. >> eurozone manufacturing hit its highest levels in six years. uk may manufacturing coming in better than expected. we are seeing green across the screen. nice gains over in europe. italy up 1.2%. brazil slashing the interest rate to 10.25, despite its political crisis. that move was expected. ten-year treasury node dipped below 2.2%. this morning we are sitting at a yield just above that, 2.213. not too much movement in the bond markets over the course of the last couple weeks.
dollar board, we saw it slip about 0.3% yesterday. for the movrnth as a whole, for may down 2%. continuing that weak slide on a monthly basis. this morning, as you can see, seeing a bit of dollar strength, up about a third of a percent against the yen. the pound continues to see some weakness in and around the latest polls, the latest yougov coming out 42-39. only a three-point lead for theresa may's conservatives, albeit on the important question of who would you like to see as prime minister, she maintaining a bigger lead as opposed to which party will you vote for. something to keep an eye on and perhaps a reason why the betting markets are favoring her strongly. gold prices, up a little bit yesterday. sort of broadly flat for the month. slight positivity. you might have expected more gains for gold given 2% weakness for the dollar in the month of
may. yesterday banks did underperform significantly. there is the trade performance. goldman sachs down 3.3%. some others down 1%. goldmans was the laggard and did weigh on the dow yesterday. this came after commentary to suggest that trading performance will be down year on year in the second quarter. it slipped in the month of april and did not pick up in may. talked lots about how low volatility was. that weighed on the banks yesterday. i bring it up because i want to yuf set a c offset a couple points, it's more a cyclical factor, not a structural post election evaporation of gains. people have been pointing that we're nearing bear market territory on the banks. goldman sachs is down 16% from the peak. >> ten-year yield at 2.20 doesn't help. >> yesterday it declined, more than a one-off trading update than that more structural end of the reflation trade that the
yield curve points to. >> i think it's why the month of may, you know, is being celebrated as a month where the nasdaq rose for a seventh month in a row. the dow and the s&p rose for six, seven months. if you look at the gains, it was a few big cap tech stocks. if you were heavily weighted in financials, which a lot of hedge funds are, some of the other big cyclical groups, consumer names got hit hard. it wasn't exactly the best month. it wasn't an equally distributed broad based rally. that's why people are watching. also the russell 2000 index of small caps have underperformed. so there are some warning signs that we need to watch to see if the rally can continue. turning to today's agenda. earnings and the economy taking center stage. dollar general reports results before the open. broadcom and lululemon are out after the close. a ton of data throughout the morning. adp, private sector read on jobs, weekly jobless claims, revised productivity and costs,
ism manufacturing, construction spending, auto sales are all out today. fed governor jay powell will speak at 8:00 a.m. eastern and then sit down with cnbc for an exclusive interview with squawk on the street at 10:00 a.m. san francisco fed president john williams is expecting three interest rate increase for the year but says four could be appropriate. speaking in skouth korea this morning he added he doesn't fiscal changes to impact the u.s. economy this year but suggests we could see effects that could influence growth next year and the year after. another top executive is leaving uber. the company announcing its head of finance is leaving. uber reported a loss of 7$708 million in the first quarter, that was narrower than the 991 million loss reported the previous quarter. revenue grew 8%. the privately held company is not obligated to publish results but has been doing so.
conagra has approached pinnacle foods about a possible acquisition. there's no certainty that pinnacle will engage or that conagra will pursue a potential deal further. hewlett-packard enterprise reporting a steep drop in revenue from the key service group. it's down 1.1%. don't miss hp ceo meg whitman on cnbc at 9:10 a.m. box's quarterly earnings ahead of expectations. box is accomplishing its current goal of generating cash from the cloud software business and adds an artificial intelligence effort is up next. palo alto networks getting a solid bump after reporting better than expected revenues in the latest quarter. the cybersecurity firm's results are due in part to a stronger customer sign-up. certainly in the wake of cry at.
marathon petroleum saying the previous authorization for a buyback had $2 billion remaining as of march. shares of ollie's bargain outlet slipping. same-store sales rose nearly 2% during the first quarter. not one we mention often. still ahead, uncle joe is not done with politics just yet. we'll tell you about the announcement we expect from the former vice president later today. speaking of politics, hillary clinton taking a fresh swipe at president trump. the details and the sound coming up. stay tuned, you're watching "worldwide exchange" on cnbc. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7.
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do it in seconds. because we should fit into your life, not the other way around. go to xfinity.com/myaccount welcome back to "worldwide exchange." good morning to you. let's look at the picture around the world. we are seeing gains for the most part in asia, albeit china down a half percent after a private survey for manufacturing was soft this morning. that yuf soffset a decent resulm official figures yesterday. shanghai was disae pointing for m disappointing for the month of may. the picture for europe this morning green across the whole of the region. it was a decent month for europe overall. france up about a half percent. germany up 1.4 in may. the ftse 100 was up 4% in light
of a softer pound towards the back end of the month of may. u.s. futures, green across the screen, gains for the month, but only about a third of a percent for the dow. 1% for the s&p. the nasdaq up for the month as a whole. higher today having had very slight declines on that final trading day of may. up another quarter percent led by the nasdaq once again. joe biden is keeping his options open amid speculation he may run for president in 2020. the former vice president will announce today he is launching a political action committee or pac to allow him to raise money with candidates and maintain relationships to donors. biden said the negativity, pettiness, small mindedness of our politics drives me crazy. the 74-year-old has said he probably won't run in 2020 but hasn't totally ruled it out. he is getting a bit older. they need fresh blood in the democratic party. >> i wonder if he wishes he ran
in 2016. >> i would think the answer to that would be yes. >> we're going to talk about hillary clinton, there's so much blame on the other side rather than taking responsibility from the democratic side. i wonder if joe biden would have been a different picture. >> no way of knowing. hillary clinton says she takes responsibility for every decision she made during the u.s. presidential election but she says that's not why she lost. speaking at the code conference in california, clinton says weaponized information was one of the key factors that swung the vote. >> the overriding issue that affected the election that i had any control over was the way that the use of my e-mail account was turned into the biggest scandal since lord knows when. in the book i'm using everything
everybody else said about it besides me who said this was the biggest nothing burger ever. it was a mistake. i said it was a mistake. if i could have turned the clock back, i wouldn't have done it, in the first place. the way it was used was very damagei damaging. >> clinton also said her campaign didn't engage in false content like the other side. last night president trump tweeted crooked hillary clinton now blames everybody but herself refuses to say she was a terrible candidate. if there is hard evidence, she'll have something to complain about. until then, it was her responsibility to push back on that issue. >> she always starts these
speeches with i take full responsibility, dot dot dot but, and there's no hard evidence of anything yet. until there is, all she can do is take responsibility. >> we heard from sol me of the biggest names in media and tech at the code conference. including the time warner ceo. >> the rules on what is p pro competitive or what isn't or the assessment of that is properly done by the department of justice. i don't think that the -- who's occupying the white house really changes that. we're not particularly thinking that that's a significant factor. >> that's the same message we've been getting from randall stevenson, at&t's ceo. they both think this will go through despite what president trump said on the campaign trail. still ahead, political and business leaders gathering in
russia today to strike deals and discuss the global economy. we're live at that forum in a couple minutes. this is the new new york. we are building new airports all across the state. new roads and bridges. new mass transit. new business friendly environment. new lower taxes. and new university partnerships to grow the businesses of tomorrow today. learn more at esd.ny.gov
welcome back to "worldwide exchange." the head of russia's central bank talking everything from oil prices to interest rates to u.s. politics in an interview with cnbc. geoff cutmore is live in st. peefrt petersburg with more. >> the message from the central bank governor was interest rates will come down in russia.
part of the reason for that, once suspects, even though they have a floating ruble here there have been concerns about the stronger inflow of capital. that's a turnaround on the outflow they saw hundreds of billions of rubles leaving after sanctions were imposed. i asked the central bank governor to what extent she's also concerned about an impact on the russian economy from the senate intelligence investigations. let's hear what she had to say. >> in general we see more interest of foreign investors. >> so you don't worry about the politics in america? >> it's strange, but from macro economic point of view, there is no problem with this kind of thing. >> clearly in st. petersburg, none of the russian business people we speak to are happy about sanctions continuing or about the ongoing paranoia, as they describe it here, in
washington. having said that, it doesn't seem to be deterring foreign investors. back to you. >> is there elevated concern now there is a special investigator appointed that the senate committee hearings, for example, are starting to subpoena more documents or individuals, or is that the rhetoric that people don't believe there's anything to it? >> i think there's a sanguine attitude here. they want to see the smoking gun like everybody else. i spoke to putin at the summit in the arctic, he said read my lips no interference in the u.s. electoral process. a lot of poeople don't believe that, but we need to see some evidence at some stage. i don't think there are elevated fears here. people are keeping a watching brief. they are concerned if evidence is found that it will have impact on business and there
will be a backlash. i think they're holding counsel until they see something concrete come out of that intelligence committee inquiry. >> kremlin ahead of trump decision says paris deal would be less effective without participants, but russia supports the paris climate deal. russia has come out, china has come out, europe as well. >> which two countries don't? nicaragua and syria. >> jeff sgeoff cutmore, thank yy much for that. attention harry potter fans, we have a special announcement that will bring magic to your day. stay tuned, "wex" is back in a couple minutes.
good morning. june swoon or boom. will the record rally continue on wall street? forget paris? president trump will decide today whether the u.s. will pull out of a landmark global climate deal. we have the latest ahead. trending today, a dramatic scre scene in the ukraine as a water pipe explodes. more of these must-see immraage ahead. you're watching "worldwide exchange" on cnbc. ♪ good morning. welcome back to "worldwide exchange" on cnbc, i'm sara eisen. >> i'm wilfred frost good morning to you. it's throwback thursday, kicking it off with songs of the summer.
>> i was disapproving of bon jovi. >> i don't know this song. futures are higher. we had declines yesterday, but slight indeed. gains today slight would have to say. the dow called higher by 14 points. s&p by 3. nasdaq by 15. of course ended the month of may with gains led by the nasdaq. more on may's performance in a moment. asia overnight, pmi data for may hitting an 11-month low. the data in particular was for 9.9 49.6, expectations of 50.1. below 50 compared to official data the day before. news in terms of the chinese currency, the yuan reaching a seven-month high overnight. the pboc has been intervening in the market over the last week
after that debt ratings downgrade and therefore propping up the currency once again. something it hasn't needed to do for the last three, four months. either way, china only down about a half percent. let's look at european trade. eurozone manufacturing pmi hitting highest levels in more than six weeks. that was in line with forecasts. green across the screen for european trade. uk manufacture earing dating da than expected. germany slightly higher, about a percent. france positive also. brazil slashing the benchmark interest rates by 100 basis points. the move was expected. as for the broader market picture, oil prices rebounding a bit after a 3% slide yesterday. let's show you what's happening. wti crude still at $48 a barrel.
48.90. brent up a percent at 51.27. ten-year treasury note yelleiel 2.20. we have a ton of economic data today starting with the adp private sector read on jobs. as for the u.s. dollar, mixed picture. weaker for the month of pay. it has been weaker all year long. we'll see if that reverses into a fed rate hike. dollar is a bit firmer, just fractionally against the year ro and again euro and against the yen. the pound continues to suffer as polls tighten ahead of next week's election. we have weaker gold, down half a percent. breaking deal news. ppg is withdrawing its proposal and will not pursue the offer for akzo nobel.
ppg says the deal will not go ahead. they refuse to engage. so we're looking at the immediate reactions. akzo nobel down 1.9%. that's in dutch trade. live trade, ppg has not moved in the premarket yet. there was lots about this deal and confidence that it would take place already slipped, but the akzo nobel price down 1.4% as we speak. if and when ppg reacts in the premarket, we'll give you an update. >> akzo rejected three cash and stock offers from ppg since march. a long-running saga, turning down the latest offer. there was a deadline. for now no go. recapping may's performance. >> so the dow closed up over 0.3% for the month. s&p rose 1.16%. the nasdaq posted a gain of
2.5%. best performing sector was information technology up 4%. utilities and consumer staples were the next two best performing. may's worst performing sectors, energy, down 4%. financials down 1.4%. telecom down nearly 1%. that financials trade has been hitting a lot of investors. it was so popular after the election. >> the pullback, we have seen that since the march high, the likes of goldman sachs down 16%, bank of america down 10, 11. the pullback really came in late march and early april. for may, yes, down 1%. that was all in yesterday's trade. goldman sachs down 3% yesterday. would have had a positive month of trade for financials in the month of may if not for yesterday's performance, which as we spoke about earlier, was
an update on trading revenue from other banks. the pullback came in terms of the lack of the trump trade in the earlier part, march/april time. may held up all right. as you were saying earlier, without the big gains and big tech cap stocks, we would not have seen that performance. the only other thing for energy during the month as well, that's a little bit of a surprise. oil prices were not down that much. again, until the final day's decline of 2%, we were basically flat for may for oil prices. clearly a lot of volatility in there. a lot of toing and froing. so it was the potential downside that weighed down. for the month of may as a whole, down 2%. >> i think the question is going to be, will we get broader based participation to carry this rally? it's been lifted on the back of mostly technology. will the earnings be as rosy as the market is painting them now?
stocks at record highs. everybody points to earnings, you're not getting that optimistic picture from the bond market. is the trump administration going to move forward on its agenda and bring in some of the goodies that were promised like tax reform. first they have to get healthcare done. people are talking about infrastructure. we talked to the ceo of a big infrastructure company saying it will get done by this year. >> the other thing as well, the dollar down 2%. another big move. >> that helped some of the big names on earnings. president trump will decide today whether or not the u.s. will remain in a landmark climate agreement. the president tweeting last night, i'll be announcing my decision on the paris accord thursday at 3:00 p.m. in the white house rose garden. make america great again. two officials telling nbc news that the president is leaning towards pulling america out of the deal. the president promised on the campaign trail to withdraw from the fact, saying it gets in the
way of jobs. but several corporate leaders, foreign heads of state and some in his own administration are urging him to remain in the paris accord. some of the ceo letters from his own counsel of advisers are saying it will help america stay competitive on the global stage to be in and in a leadership role. it will help create u.s. jobs. these are exactly what president trump has promised on the campaign trail and as president. >> and his daughter, his son-in-law are all campaigning him to stay in. >> the pope. >> indeed. pretty much everyone apart from -- >> bannon and some members of the administration. turning to today's agenda, earnings and the economy takes center stage. dollar general reports results before the open. broadcom and lululemon are out after the close. a ton of data throughout the morning. adp, private sector read on jobs, weekly jobless claims, revised productivity and costs, ism manufacturing, construction
spending, auto sales are all out today. fed governor jay powell will speak at the economic club of new york at 8:00 a.m. eastern. following that he sits down with steve liesman for an exclusive interview with squawk on the street at 10:00 a.m. another top executive is leaving uber. the company announcing the head of finance is out as the firm posted a loss of 708 million for the first quarter, which is narrower than the loss reported three months ago. revenue grew 8%. the privately held company is not obligated to publish results but has been doing so. top trending stories now. starting with hillary clinton getting some buzz for comments she made about jeff bezos yesterday at the code conference. listen. >> i think jeff bezos saved the "washington post." his purchasing the "washington post" i think a lot of people, a lot of his peers and friends, why would buy this ancient medium called a newspaper?
but newspapers still drive news. drives news online, on tv. >> he did save it with the monetary injection by buying it. it has been doing amazing work and breaking news. >> he's investing in the medium of hard core journalism and if there's anyone that can save it and bring it forward to the modern era over the next few years, it's probably jeff bezos. don't know if he fully offered on amazon or not. the harry potter series is turning 20 years old this month. in honor of harry potter and the sorcerer's stone, the publisher is leasing a new edition. >> the gift that never stops giving, harry potter fans. >> to harry potter fans, to j.k.
rowling, and to our parent company. not books themselves, but the films very successful. >> the theme park at universal studios. check out this viral video out of ukraine. close circuit cameras captured the massive explosion of an underground water pipe in kiev. this video shows the ground shaking followed by a burst and sludge. nobody was hurt. the cause of the explosion was unclear. it is just the video that has us all captivated. certainly spread through social media. coming up, the must-reads including george soros making the case for europe again. as we head out, another check on futures. looks like it could start june off in a positive way. dow futures up 9 points. nasdaq futures up 14. will tech dominate june as it did the month of may? "worldwide exchange" will be right back.
welcome back to "worldwide exchange." i'm sara eisen along with wilfred frost. it's time for our must-read stories that are catching our attention. i went to the "usa today." portland has seen enough says ted wheeler, who is the mayor who just to recap here has tried to revoke a permit for a bunch of rallies on sunday for pro donald trump free speech in downtown portland.
the reason he did this, he said it would exacerbate pensions following last week's deadly stabbing on that train. he writes while the planned demonstration is constitutional it's highly irresponsible in the wake of the horrible act of racist violence. our community is still in shock, in mourning and we're angry. there's never a good time to bring messages of hate to our city. there could be no worse time than now. i guess they're worried about hate speech, they're worried about more nationalist alt-right messages coming at a time where portland is still in mourning after those heroic acts. >> that coming from the mayor himself. my pick in project syndicate, "standing up for europe" written by george soros. he writes meaningful progress there is three indispensable areas that need change.
territorial disintegration exemplified by brexit, the refugee crisis and the lack of adequate economic growth. on all three issues europe starts from a low base of cooperation. as i said, he is actually upbeat about recent improvements in the outlook, but says now is the time to strike. positive momentum coming off dutch elections, coming off french elections, and that they need to strike for serious reform and brexit itself will be a tough process to get through. overall upbeat, and mr. soros someone we will watch. >> he has made some dire warnings on european elections, especially on brexit. he was right on the call on the currency. not sure on some of the dire warnings. just how exaggerated they were about the break up of europe and the decline of the world order. so far it stayed together, which is why he's feeling positive. >> positive, albeit saying you need to make the most of the situation they got. this window of opportunity.
>> we're approaching the top of the tour. the team is getting ready for "squawk box." becky quick has a look at what's coming up. >> good morning. we'll be watching what's happening with the jobs report. that report is due out tomorrow. it's the one we've been waiting for all week. today we will get the adp report that comes out at 8:15. the consensus is for 180,000, i've seen estimates all over the map. so we'll see what happens. it's particularly interesting after what we heard from the fed yesterday with the beige book. mark zandi will be on to talk about this. the beige book showed a labor shortage is affecting more occupations, more regions of the country. a u.s. bank study showed 61% of small business owners say they're having a more difficult time trying to find qualified people to expand their businesses. it is becoming an issue that could affect the economy. we have dan roth on to talk about the linkedin work force report what they've been seeing. all of this will give us a clue
about what to expect tomorrow from the official jobs report from the government. we'll speak with larry summers, the former treasury secretary. he will talk to us about all kinds of things. i would like to talk about this battle that seems to be taking place between mnuchin and mulvaney in the administration on whether to lift the debt ceiling with or without additions. if it's a clean lift like mnuchin wants, or if like mull vanny wa mulvaney wants tax concessions. and al franken will join us. he has a new book out "giant of the senate." he reflects how the senate has changed since he's been there. how difficult it's been to be taken seriously as a senator after being on "saturday night live" for a number of years. he also sits on the health committee. >> becky, great stuff. lock forward to it. "squawk box" in 12 minutes time.
up next, the first trading day of the month with city's steven wieting. they call him the whisperer. the whisperer? why do they call him the whisperer? he talks to planes. he talks to planes. watch this. hey watson, what's avionics telling you? maintenance records and performance data suggest replacing capacitor c4. not bad. what's with the coffee maker? sorry. we are not on speaking terms. tha...oh, burnt-on gravy?ie. what's with the coffee maker? ...gotta rinse that. nope. no way. nada. really? dish issues? throw it all in. new cascade platinum powers through... even burnt-on gravy. nice. cascade.
good morning. welcome back to "worldwide exchange." recapping some breaking deal news, ppg industries will not launch a formal bid for akzo nobel after several informing offers were rejected. under dutch law ppg cannot approach akzo now for six months. shares of akzo down over a percent. the likelihood that this deal won't be happening had caused akzo slip. a look at market futures. looks set to start june on a positive note. dow futures up 7 points.
nasdaq up 14. s&p up 2. joining us now is steven wieting from citi private bank. good morning. >> good morning. >> welcome to the set. with stocks at a record high, how much of it is the trump trade or is that dead? >> expectations for big policy action out of the united states have been fading. we've been acting like there's single party gridlock in washington. and the rest of the world has been mildly accelerating without the promises of big tax cuts. so you can see the influence on the foreign exchange market where the dollar has fallen 5% this year. >> we saw the performance for may. nasdaq leading the charge. if you look at it by s&p, sector performance, tech leading the charge almost 4%. >> secular growth, nothing driven by a big cyclical boost. >> but is that hiding a broader weakness in the market that could now unravel a bit further over the summer if tech fails to
hold up that outperformance? . the summer months are the time where you get the routine temporary pullbacks in markets. the fact that we tend to get downside economic surprises in the summer and that is a worldwide phenomenon. that also could lead to it. beneath the surface we've seen quite solid earnings out of the united states. 15% in the first quarter. that is not just tech. tech has been outperforming, especially the large companies. you've been seeing improvement elsewhere. what i think is interesting is that we will see profits through the rest of the world catching up to that tape. this is part of our marketplace where you have not seen the kind of performance in the last five years that you have out of u.s. stocks. >> on u.s. profits, can that kind of momentum and growth continue with some of the economic data disappointing? >> the biggest piece was going from $25 oil to $50 oil. one-third of that gain was in the energy sector. >> dollar helped.
>> if you're looking at 10% gains for the first quarter away from energy, this will be better than expected year compared to a few months ago. it will be a double dij skrit gain for prof digit gain for profits. >> what is your outlook for the global growth prospect s that fully priced in? >> there's been the small story. the fraact that china overshot. some cyclical indicator are so far above the targets that the chinese government would prefer that you are seeing steps to rein that in. there's an effort for stability there. ongoing solid growth. and lots of other places. very moderate but widespread growth throughout emerging markets and the improvement in europe. >> is that enough to keep
meernling markemeernl i emrn merging markets, stocks going? >> can be a period where the u.s. congress only has to have one vote to succeed on easing fiscal policy. it can fail all year long and only that one success will count. away from that, you had a six-year run up in the u.s. dollar. 33% rise. it erased more than half the return in international equities since the dollar bottomed. and now you have quite good relative valuations in equities in the rest of the world. if you grow, you will succeed with that kind of combination. >> >> final question, sector preference for the summer coming ahead? >> summer, quite volatile. i think anybody trying to figure out exactly what sector to be in better have the short point of view on that. you know, i think that beneath the surface, stable growth that you see globally, not just in the united states, in healthcare, technology, where some of the largest firms are having persistent industry
transforming gains, you know, for year after year after year for some of those names, and then away from that, a cyclical recovery. i think that's still underway in energy and financials. >> banks are a buy? >> i think it's not as easy as it was late last year. we had a pretty good run up, but this was the cheapest sector going into any of this. this is the first cycle where the federal reserve pays interest on reserves. we're seeing short rates move up, not long. that helps for the first time. >> stephen, thank you very much for joining us. in terms of things to watch today, i will be watching the banks given that we got big declines in them yesterday. goldman sachs down 3%. something to watch in case they slip again today. >> on a related note, we'll watch the yields. we have a lot of economic data. adp which could be a good preview for the big jobs report tomorrow. we'll get manufacturing data and
fed speak. >> that's it for "worldwide exchange." thank you very much for watching. "squawk box" comes next. you get used to food odors in your car. you think it... ...smells fine, but your passengers smell this bell dinging new febreze car with odorclear technology cleans away odors... ...for up to 30 days smells nice... breathe happy, with new febreze.
good morning. forget sell in may and go away, markets locking in gains as we prepare for june trading. also the longest day is coming. so bright out. amazing. except is rains every day. uber opening its books, revealing a narrower loss than in the previous quarter. and a media mogul speaking out at the code conference in california. we'll bring you their comments on mergers, cord cutters and content producers. it's thursday, june 1, happy birthday, dad. "squawk box" begins right now.
♪ live from new york where business never sleeps, this is "squawk box." good morning. welcome to "squawk box" on cnbc. we're live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at the u.s. equity futures. they've been a little higher this morning. emphases on little. dow futures up by 7 points. s&p up by 2 1/2. nasdaq up by 15 after the markets closed a bit weaker yesterday. let's look at what happened overnight in asia. you'll see that the nikkei was up by over 1%. it was a gain of over 200 points. hang seng up by a half percentage point. shanghai was down by a half percent. in europe in the early trading at this hour, you will see that there are some modest advances through most of