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tv   Worldwide Exchange  CNBC  May 7, 2019 5:00am-6:00am EDT

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>> it is 5:00 a.m. here at cnbc. breaking trade news. china is coming. their top negotiator will be in d.c. for this week's trade talks. we will take you live to beijing with reaction. the comeback kid wall street staging a remarkable recovery despite the ongoing trade tensions, but what's in store for today? all you history buffs need to listen up. japan's stock market has done something it has not done since world war ii we'll bring you that incredible stat chevron, you were are on the clock. a major update to the friday night fights taking place in oil in the permian basin and a big bet on your pet. what wal-mart just did that
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could leave its competitors barking mad. it is tuesday, may 7th, as worldwide exchange begins right now. >> welcome from wherever in the world you may be watching. wow, what a difference a day makes. yesterday the markets indicated that they were going to tank at the open dow futures down 500 right now, yes, we are in the red. dow futures off 1 11 we are red, but compared to what with we had yesterday, this doesn't look too bad of course, the markets in the money really reacting to just one thing right now.
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let's go to eunice with more >> the commerce department announce reasonable doubt that the chinese vice premier would be attending the trade talks in washington on thursday and friday with the trade representative robert lighthizer and steven mnuchin there had been some concern that the chinese vice bream or even a whole delegation wouldn't show up in washington after president trump had tweeted his tariff threat, and overnight lighthizer had announced that the u.s. would now, the talks are on, but the chinese press just put out a very strongly worded i had
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toral. this is am the people's daily which is the official paper. it said that the u.s. should not even think about concessions it goes on to read "when things are unfavorable to us, no matter how thank you ask, we will not take any step back." now, the tougher line coincides with what the chinese have been saying repeatedly that they are willing to negotiate but not with a gun to their head >> if you look at the papers here, the dialogue is that china has changed the terms at the last minute, and that's why the president responded in the way that he did. what do the headlines say in beijing? >> well, actually, until we got this headline, there really weren't any headlines at all
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that is who was so remarkable over the past couple of days since president trump's tariff threat, there has been very little reporting on this particular tweet and on the tariff threat, but then the people's daily now is coming out with this strongly worded editorial, and i think it really sets the tone now for these discussions and saying that the chinese want to hunker down and make sure that they do not appear as though they are being bullied by washington. especially here in china >> so the trade talks were not in the headlines >> barely. even that tweet that i was talking to you about and the imabling we were discussing yesterday of the tweet, it wasn't -- not on-line. still not being openly discussed. >> what are the headlines? missing dog found? what ---ive working really hard,
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but i was also watching a couple of videos of puppies and a cat that was looking at a durian it's a tropical fruit that stinks really badly. those are some of the other -- the stories that were in the press. >> trade talks >> it was serious work i was working most of the time >> you're working around the clock. we appreciate it >> speaking of tweets, here's how jim cramer thinks we'll play out. he tweeted late last night "let's be sure the tariffs are coming they will be raised on friday. the president likes the money that comes in from them even if you believe that is misplaced. well, we just referenced that remarkable 180 for stocks yesterday, and if you missed it, here's what happened when we came on the air 24 hours ago dow futures down 500 points.
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it was nearly 450-point turnaround all in throughout the day for equities how do we look right now let us fine out. we are still in the red, but on a smaller percentage basis dow futures down about 110 points right now by the way, bonds they got a big bid. yields fell. the yield on the ten-year note, still below 2.5% at 2.48%. you know who likes that? realtors because mortgage rates are going to either stay low or tick lower now to asia where something that happened in japan has not happened since all the way back in world war ii. stocks were closed for trading for six days an extra day for the enthroning of their first new emperor in decades. china also a big story the two major averages yesterday down 5% and 7% respectively.
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today a bit of a different story. we are seeing the shanghai composite up very fractionally by the way, japan fell 1.5%, and oil, it is slightly down right now. we're seeing oil off .3% the big mover, actually, on a percentage basis is something we have not talked about a lot lately that is bitcoin. bitcoin getting some buyers today. it is up 3.2%. are you surprised, tim at just how reactionary this market appears to be to these trade headlines? >> i would say not totally surprised that as a deal gets hammered out, you are going to see a little increase in volatility.
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in a word, not a big change. i think tweets around the edges make sense as we look at the pillars of the market this year that have really propelled gains. >> what are those tweaks >> i think the key tweak would be to say, look, where are some of the lower valuation better entry point opportunities, and even though you are seeing volatility in places like china or emerging market stocks, that to us still looks leak a more attractive destination especially as you get to these later stages where there could be actually some up side here if you do get better than expected news on the trade front. >> i have a genius follow-up for you. ready? >> ready >> where are those lower valuation better entry point parts of the market that you just referenced? what are they? >> for the most part when we are looking at equities, we think emerging market equities if you are looking at the price to earnings ratio on something like the msci emerging market index. that's a significant discount relative to here in the u.s. valuations here are not a stretch because they were last
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year we did see a nice earnings growth and price action. price toerngz. price to sales price to book. you name it. we can make the case for it being just incredibly inexpensive. >> but, yet, the mark has done nothing. how come nobody is reacting more to japan >> well, i think when you look at some of the structural forces weighing on japan long-term, the story isn't so bright, whether it's demographics, whether it's more restrictive labor market. when we're thinking about japan, i think it's more about a selectivity story, and, again, as the u.s. continues to grow and continues to prosper, that's going to naturally be a nice catalyst or a buoy for international developed markets.
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>> are they slowing all this stuff? europe is a good bet >> when we look at -- >> or a better bet than us >> i think, exactly. when you look at year-to-date, europe has lag the, both versus the united states and the rest of the world. >> we get another big batch of earnings you have mylan labs, electronic arts, lyft, and papa john's. now, on the data front we're going to get a pulse check on the jobs market with our favorite economic indicator here on world wooitd exchange that is the most recent joelts
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survey job oels opening and labor turnover do we still have seven million open jobs in america we're going to find out at 10:00 a.m. eastern time today. that is not all. at noon eastern wynn resorts will kick off its annual shareholder meeting, and we'll have full coverage of all of this throughout the day here on cnbc well, there is still so much to do on this tuesday morning coming up, a permian power play. the friday night fight in the heart of oil country taking another twist. why chevron you are now on the clock. later, brewing up an ipo the world's number one beer market making a big bet on asia. all that and more right after this
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chevron, you are officially on the clock a big battle on the big battle over the permian basin in texas. it kicks in a clause that gives them four days to come back with a counter bid. investors believe chevron would now have to top occidental's $6 per share bid because occi add more cash to the deal. if chevron can't or won't rebid,
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it still gets paid if anadarko goes with occidental, it has to pay chevron a $1 billion break-up fee. let's get you up to speed on some of the other big stock stories to watch >> quite a mix here. we're talking beer, insurance, and rental cars. shares of ab inbev are lower in europe after it reported first quarter profit and sales that came in slightly below forecast. now, a recovery in brazil did help offset a decline in beer volume in the u.s. that's its biggest market. the world's largest brewer is also exploring the listing of a minority stake in its asia business later this year results there were helped by higher premiums, lower costs, and an improved underwriting at its core general insurance business aig trading up about 7% this morning.
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the rental car company expecting a smaller than expected loss in the first quarter as u.s. re new rose about 7%. the company attributes some of the sales increases to its expanding business working for ride-hailing companies such as uber back to you. >> see you in a few minutes. thank you very much. at cnbc we talk to the sea suite. beats get to frank holland with the newest cnbc cfo council survey >> you know, just days before the president tweeted that $200 billion worth of chinese goods could see tariffs raised from 10% to 25%, the cfos in our survey expressed their lowest level of concern over u.s. trade policy since those tariffs on china were put into place last year.
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they don't see trade policy having any impact at all 15% believing it could benefit their business you could say rising optimism here in the u.s., but this trade deal still seen as a vashlg that has to be accounted for. especially internationally when asked what is the biggest external risk to your business, well, u.s. trade policy was the top answer for cfos in europe, the middle east, and africa. it was tied for a first for asian pacific cfos it was tied also with china as one of the listed top answers here in the u.s. cfos only 10% giving that answer also, last quarter no cfo saw china as an external risk. now 13% of the global groups say they feel that way about the world's second largest economy brian, back to you >> all right frank holland. thank, thank you very much the cfo council survey still ahead, a tax smackdown
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what treasury secretary steven mnuchin just did that could set up a big battle on capitol hill. and wal-mart just made a big bet on your pet. the what and the how much ahead. - i love my grandma. - anncr: as you grow older, your brain naturally begins to change which may cause trouble with recall. - learning from him is great... when i can keep up! - anncr: thankfully, prevagen helps your brain
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>> a live look at the nation's capital building buchl shot beautiful building well, wal-mart hoping that spring and summer and fall go to the dogs literally. they are making a bigger bet on your pets. wal-mart says it wants to add about 100 vet clinics in its stores within the next year. that would be up from the 21 they currently have in operation. wal-mart is also launching an on-line pet pharmacy why would wal-mart do this because, get this, americans spend about $75 billion per year on our furry friends. >> there are three committees
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that want them one has the power to request them, and they've done that now. as you said, they've been denied their next stop may be taking it to court >> steve mnuchin says he will not turnover president trump's business tax returns >> they will delay it for as long as possible and my guess is that they go into the courts >> mnuchin calls the request unprecedented. democrats accuse the administration of stonewalling on that and turning over the full mueller report. >> the administration is trying to hide information that potentially may be dwajing to the president. >> the house judiciary committee votes wednesday on whether to hold attorney general william barr in contempt of congress for failing to turnover that report under subpoena >> they really leave us no option if they're not even going to negotiate in good faith >> the justice department says there's no legitimate basis. >> both sides in this are
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doubling down on stupid. >> part of what was redacted from the report and democrats
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want to see. he cannot discuss classified information that is in that report yeah, even if they get him in front of a microphone in the hot seat, there are certain things that he cannot talk about, and robert mueller is known to be a guy who sticks to the rules. he is a lawyer, after all, and he is said to be the type of person who is probably not going to venture much further from what he wrote in that report in the first place. >> good point there. tracie potts in d.c. see you tomorrow thank you very much. now to other top headlines outside of the world of money and birks including trump, tiger, and how much it now costs to put a tiger in your tank. northbound's phillip menna with those stories. >> we have all that for you, brian. good morning president trump has granted a full pardon to a former u.s. soldier that was convicted in the 2009 killing of an iraqi prisoner during his trial, michael bohanna acknowledged that instead of transporting the prisoner as ordered he questioned the man at gunpoint and says he shot him in self-defense he was sentenced 25 years in prison, which was reduced to 15
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years. he was paroled in 2014 the white house says 27 generals and admirals signed a brief in support of the self-defense claim. experts say trs relief in sight. gas prices could normalize in coming weeks with dropping crude oil prices brian, back to you >> i'll tell you what, phillip, i know we don't have a lot of viewers probably in los angeles. they're probably coming in reason if they're watching you know what i saw? $4.75. that's in parts of l.a >> man >> $4.75 the case against large vehicles
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right there. that's a lot of money. >> case against california right there. my home you state. phillip, mena, thank you very much on deck, what are the biggest global risks to your money right now? is it china? is it iran is it something else michelle caruso cabrera will join us with that. later on, a new report lays out the best and the worst jobs in america right now. is your job on the list? we're going to break it down next ♪
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♪ applebee's bigger, bolder grill combos. now that's eatin good in the neighborhood.
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china's top negotiator heading to washington. after yesterday's stunning turnaround china or iran? what is the biggest global risk to your money and investments right now? michelle caruso cabrera is here, and she will break it down chevron, you are on the clock. a major update in the bidding war breaking out in the heart of u.s. oil country all the details as worldwide exchange rolls on right now. ♪ ♪
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sfloinchts a big update now on that bidding war happening in the heart of america's oil country. anadarko, its board saying that occidental's takeover offer is superior to chevron's current bid. chevron now has four days to come up with a better offer. if it cannot, it's revised offer is rejected or anadarko must pay a $1 billion break-up fee. >> you don't make a deal, and you still walk away with $1 billion. would you take that deal >> $1 billion sounds pretty good to me. >> it does right now not bad. hey, anybody would be honest about that thank you very much. >> well, here's how your money and investments look right now we're halfway through the 5:00
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a.m. hour. dow futures in the red compared to yesterday where we were down at this hour, 500 points i guess relatively it doesn't look too bad dow futures off 137. nasdaq and s&p futures are down as well. despite some of the optimism over trade talks bonds getting a bid. bonds being bought yields coming down benchmark ten-year yoeld at 2.47%. as we noted, realtors, you got to love that mortgage rates are going to stay steady or move even lower you heard phillip mena talk about higher gas prices. today anyway we're seeing all the hydrocarbons they're down crude oil off about three-quarters of 1% to $61.79 a barrel brent and nat gas also down as well in asia japan's markets reopened they lost 1.5% they were closed for six days. they had the golden week holiday, and plus, the enthroning of the new emperor. an extra day off of trading. that, by the way, six days with no tralgd hasn't happened since world war ii we saw the hang seng and shanghai composite
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they were down 5%, 6%, 7% yesterday. it is a mixed trade in yesterday. they are opening now they are down .8%. all right. let's turn now back to trade we'll try to get a little bit of context on exactly where we stand and all this talk about tariffs and the fight over tariffs. deutsche bank out with some really interesting new numbers on president trump's latest threat to ramp up those tariffs on china what deutsche bank's team did there is they crunched all the numbers for globally for tariffs on all products. i mean, really all the tariffs that a country has remember, countries have a lot of tariffs so we don't talk about every day. they said as mare of the economy, how much do tariffs really matter? heeshz a snap shot of where things currently stand vaukin choorks, you turkey, germany. look at the united states. united states down here.
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that's currently where we are in the world. if the u.s. followed through with the new round of tariffed friday, that 10% to 25%, and that new round of 25% tariffs on another $300 billion in products, that president trump has talked about, that's what would happen on $300 billion. if that were to occur, i guess the worst case scenario, if you will, we would be on par with brazil, above china, and right around saudi arabia's level. >> let's talk more now about trade, china, and what may be the greatest global threats to the markets and your money right now. joining us now is cnbc contributor michelle caruso cabrera. the one who launched, by the way, this show michelle, great to see you again. >> pleasure to be here, brian. >> we talk so much about china, but i know you know this stuff as well as anybody in the world. is iran the real global threat right now to the markets and the
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money? >> i would say that iran is the greatest risk that is not priced into the markets at the moment as we watch every day on cnbc, market participants pay attention to every single headline that comes out when it comes to the china trade deal, but the markets have not been paying attention to what has been a sharp increase in the escalation of the tensions with iran in the last week. we're sending an aircraft carrier to the persian gulf. the straig says they have evidence of threats against u.s. soldiers in iraq we have put intense economic pressure on iran, and though they talk about -- iran talks frequently through the decades about closing the strait of hormuz where so much oil passes through every day, we're getting to a point where we really have to think about whether or not that could be a possibility and whether or not we could end up in some kind of escalated situation with iran and potential military conflict. that i don't think is priced in while china is priced in nearly every second of the day, brian.
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>> there would be concerns about whether we see u.s. soldiers diaz to what kind of response the iranians would do in the strait as well oil prices would definitely go up you haven't seen a huge reaction in oil prices. that's because it's not priced in considering what's going on there, i think you might see more and more of that. >> you know, i gave a speech last night to a group in new jersey, michelle, and i think the stat that i threw out the most that got the most mur murs
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in the room was this one, and this goes to the china trade story. we sell about $180 billion per year of goods to china at first blush that seems like a big number, but when you consider that the gdp of rhode island is $200 billion per year, are we overstating the china threat >> when it comes specifically to trade, absolutely. $700 billion in trade with china on a $19 trillion economy. it's tiny. it's always been much more about where is the relationship with china going. i would argue that if it is chinese do not change their practices, trade with them was going to go down no matter what. the kind of things that the united states is insisting on, no longer stealing intellectual property, stop the force jvs, et cetera, stop subsidyizing state-owned industries those are all things that hurt the chinese economy, that curtail foreign investment they have far less than they
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would have the chinese economy is very important to the global economy. they themselves need to do things to change it and improve it what we're asking for insisting upon are things that would actually be great for the world economy. they are doing things that are actually, you know, looking backwards, where they're more interventionist. state banks are much more interventionist in the economy than they've traditionally been for the last 20 or 30 years. they were actually liberalizing their economy. >> we're not the only country. if you are a german country or siemens -- >> i'm just throwing names out there. or a u.k. company or wherever it may be, you need your intellectual property protected as much as we do do you believe, michelle, we're going to get the real turn in ip and intellectual and patent protection that we want or will china continue to do what they have done, which is steal it
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>> that i can't predict what the chinese are going to do, but what i would highlight, brian, is when you talk about what the germans need, what the europeans need, there's been a lot of discussion about us not being on the same page as our allies, but when it comes to china and their trade practices, we are absolutely on the same page as the europeans. it's been very much a united front to try to change what they're doing throughout the world. >> yeah, and, by the way, when i say steal it, it's not a knock on china the wto, the world trade organization, hardly necessarily a pro-u.s. group has, indeed, opened an investigation into the theft of ip. that's not just two acres talking about, you know, our own opinions about a certain thing that's on the world stage. if you were china and you walk into these trade negotiations at the end of this week, what do you want what do you ask for from the united states? >> so this is very interesting lee is known to be someone that wants changes in the economy -- to the chinese economy a liberalization of the chinese
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economy. all the things that we have talked about for a lpg time. and there's a question as to whether or not there's a division within the hierarchy whether xi jing ping is the problem and whether other members of the chinese communist party are the problem, and the reason why they have been dragging their feet, and not doing the changes that have been pushed for for so long changes to the financial system that would lead to far less distortion to a much better allocation of capital to less issues with inflation and pricing there. it's hard -- just like we know that there are divisions with our administration, they are sharp within the chinese administration as well >> it's going to be a really interesting few days, and you laid it out beautifully, as always michelle, great to he so you next time, come join us on set new jersey would welcome you back thank you very much. we just laid out those global risks how do you invest around them? joining us now is larry mcdonald, editor of the bear traps report and a cnbc contributor, and, larry, first off, you just heard that conversation do you agree with michelle that
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right now probably in the near term iran is a bigger threat than china >> well, yeah. it's definitely like you said, she brilliantly said it's not priced in. especially, well, in many ways it is. in other words, it's not fully priced in. brent compared to the price of oil in brent compared to u.s. oil equities has been held up extremely well something is holding it up there, and it's been swirling around and not fully priced in china, at the end of the day, it all comes down to the u.s. needs a deal the president is looking at an election 18 months away. china is so levered and the economy has been seeping back towards recession, so both sides really have to do a deal sometime in the next two weeks >> let's be sure the increase is going to come because donald trump likes to have that extra money. he is not putting a political statement on it.
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jim was simply saying he believes that those higher tariffs, 10% to 25% on $200 billion, are likely to happen as of 12:01 a.m. on friday morning. jim has been nervous about the equity markets, obviously, yesterday he showed that this market is jittery. do you believe that we will see those higher tariffs after all, larry? >> yes i think he is right. we will see them we'll see them for probably a week or two. in other words, they'll go on. >> a time-out, if you will >> essentially if you remember toward the end of the mexico-canada nafta agreement, trump put out a couple of very nasty tweets towards mexico and canada, and then four days later there was a deal these tweets -- this is just pressure towards the end you probably get a deal within two weeks, but bob lighthizer is a hall of fame negotiator in trade. he really has the president's ear right now, but at the end of the day mr. kudlow and mr mr. mnuchin, they're more
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centrists. in the end i think they'll win right now president trump is siding with mr. lighthizer >> dow futures are down 100 points, so it's a theoretical exercise, but if we get a market rally on what's been a red hot year, do we sell into the rally? >> well, you know, i think u.s. equities -- too many investors in the world are hiding out in u.s. equities. there are markets in the world like brazil, there are markets in the world european equities that are extremely cheap relative to the u.s. we believe that you want to be in emerging markets. you want to be lightening up on u.s. equities here because too many investors are hiding out in the u.s. >> what do you think right now is the most over priced asset in the world? i'm putting you on the spot. hand on the clock, larry >> i would think high end artwork overall. new york real estate, new york real estate, in manhattan. it's in some spots as the highest -- then high-end real estate in asia
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>> says the man who lives in manhattan, by the way. you know what's amazing about that statement that why are these billionaires like ken griffin buying $200 billion condominiums in new york because the rich, to your point, are finding better values outside of the equity market should we be maybe not at that level, obviously >> yeah, exactly you want to look at other, you know -- other areas. a lot of people look at gold, silver over the next couple of years i think as you head towards the 2020 election, president trump desperately needs a weaker dollar every time the dollar has strengthened, the global economy weakens. it weakens the u.s. 40% of u.s. earnings are outside the united states and then the manufacturing basis basin in the united states gets really hurt by a stronger dollar net-net you get a weaker dollar over the next 18 months heading towards the election that's going to help your gold names. >> larry mcdonald, the bear
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traps report always interesting we will see you soon >> thank you >> on deck, a major analyst call crossing on arguably the most important stock in the dow that is boeing we'll tell you what the analyst is saying. we're talking dream jobs and nightmare jobs what is the best and worst job in america the list is out. is your name on it we're going to found out later, a major update to coffee gate createors of game of thrones getting roasted. details when we come back.
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>> the sun is beginning to rise over washington d.c. there is the white house, the washington monument in the background welcome back we have a big analyst call just crossing on arguably the most important stock in the dow, and that is boeing and barclay's going to make some investors upset. they are downgrading boeing to an equal weight from an overweight also, cutting their price target to $367 from $417. the stock is exactly at $367 already, so they don't see any more price down side that's the news, but they also don't see any more upside on a stock in a price-weighted index like the dow that certainly has the power to move markets aside from the markets and trade and china, what else are we going to be talking about today? let's find out and get this morning's top trending stories what are we going to be talking about? >> this is such a good strending segment? are you ready? it's time to get ready
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career cast is out with its annual ranking of the best and worst jobs in america. data scientists can claim to have the best job nationwide with a high median salary and a projected growth rounding out the top three are statisticians, and university professors now, on the other end of the spectrum are taxi drivers. they are ranked worst in the nation taxi drivers have seen both sal skpri growth potential fall due to increased competition from ride sharing apps. also in the bottom three, logging workers and newspaper reporters. i feel like reporters always seem to fall in the bottom of these lists. >> it's tough because the industry is imploding. that's the problem you have to pay for news you have to pay for local news you're either going to get national, hyper local. i can't believe newspaper reporter is up there with two of the most dangerous jobs in america, taxi driver and logging workers. >> projected growth and also salary this one is good, and i know you are watching it because i know you so well. >> i saw some of the outfits and help me understand >> i'll try.
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last night was the annual met galla, and the stars did not disappoint this year's theme was campy, which i didn't quite understand, but katy perry came dressed as a chandelier complete with all the candles, and tennis star serena williams, how about this, i thought she looked good, she rocked a long train on a bright yellow dress and rapper cardi b. required all of four assistance to range up her enormous gown. look at that lady gaga never one to disappoint, and known for her dramatics. performed multiple costume changes on the red carpet. i think she did four costume changes on the red carpet. and not to let the men being outdoom, jared ledo carried a sculpture of his own head. that outfit was gucci. >> was it? i will say this, though, i liked that story into this story because to me the outfits that you just showed us, i don't know if you are a game of thrones watcher, but they look like some of the outfits worn by cerci
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lanasser >> we have a major update to cup-gate game of thrones is now chiming in after sunday's episode accidentally showed starbucks cup visible in the scene the show's twitter account saying the latte that appeared in the episode was a mistake denarius had ordered an herbal tea. it lit up the internet market watch out with new numbers saying if game of thrones had intended for that starbucks cup to be there, that type of product placement would be worth about $250,000. some analysts say it would be actually over $11 million because think about all the news coverage it's getting and the social media coverage it's getting. >> i'm sure somebody, some genius at starbucks and/or hbo will figure out a way to profit from that mistake, as they should >> if not already. >> perfect stuff thank you very much. well, if you had to go to bed before last night at midnight, who didn't you missed a heck of a basketball game. or so we're told
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the beloved houston rockets defeated the golden state warriors last night by a final score of 112-108 james harden does what he does lit it up. 38 points. this eenz evens up the conference semifinals. it's coming down to become a series for the ages already. next game, another one we'll miss live wednesday 10:30 p.m. eastern time all right. on deck, tariffs, trump, and trade. the three big things that need to be on your radar as we gear up for a big day ahead in your morning rbi. we asked you, put on your trade hat. if you were trump, would you hold out for the best deal would you give in? the answer might surprise you. it's your rbi and it's coming up stick around a 10-k? what's an etf? an ipo? 401(k)? where do i start? empower yourself with the free tools and resources on before you invest,
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every year, our analysts visit thousands of companies, in a multitude of countries, where we get to know the people that drive a company's growth and gain new perspectives. that's why we go beyond the numbers. t. rowe price. invest with confidence. >> futures down 120 points while in the red, still looking better than they did yesterday after that remarkable.
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the theme of this show andthis hour has been risk we've talked a lot about risks china, iran, maybe the stuff we're not talking about. you believe there are some risks hiding in plain sight. what are they? >> well, this trade dispute obviously. we have lots of them obviously intellectual property protection is something that has bipartisan support this particular issue is there with kooin, but there has been this wider issue of compliance with iranian oil sangzs, which has come up of late. we have no idea whether we're pivoting to additional tariff conflict with the european union. nothing has been actually resolved the market is giving credit. i want to look at it from a market perspective markets have looked past a good deal of these trade disputsd whether it's steel and aluminum tarif tariffs, the nafta rewrite, none of that has actually bren
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resolved trade with mexico is more to exports to mexico than we do with china mexico is a bigger trading partner by far than with china if we don't get a deal, both sides china and the u.s. walk. does the market tank >> i think there will be a negative impact for sure on that by my estimate large cap 25% higher than the end of 2017. it's very good monetary policy risks have been suppressed that was a very, very serious problem. when you look at these trade disputes, whether it's for china or the united states, you could scale them against gdp do you want come p with big numbers, but you could see potentially big impacts on corporate profits. you see it riddled through the ism. >> if we don't get a trade deal,
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do we see the analyst community start to rachet down earnings expectations >> i'm not sure they're going to get that right in real-time. there's going to be greater uncertificate on profits and there are potential disruptions across border for various companies. large cap tech companies semiconductors again, a very big run-up, and they're highly sensitive to cross-border trade this midyear period is often one which we get volatility. it's not that i think that we've come too far ultimately in share prices, but when you are dealing with markt that has looked past these particular types of risks and suddenly has to confront them, that's when you are going to see volatility pick up. >> yeah. certainly we're going to be watching these negotiations because as we saw yesterday, this is indeed a market that is reliant very much on the outcome of these negotiations regard it is how big our trade may or may not be with china. steven whiting, citi private bank always a pleasure to get your views. thank you very much. we have an rbi, but we'll do it for you tomorrow more time for you to respond about what would you do if you
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were president trump and these trade negotiations we'll repost it and do it again tomorrow that's it for us here on worldwide exchange dow futures down 120 big day. "squawk box" is next edward jones came to manage a trillion dollars in assets under care by focusing our mind on whatever's on yours.
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good morning stock market whiplash. the big comeback for the dow, and a fleurry of trade headline that sparked the moves a $5 billion fine is a bargain for the social network they're calling for more accountability start the clock. chevron now has four days to counter occidental's bit for anadarko petroleum it's may 7th did i miss cinco de mayo it was on a sunday >> it happened >> yeah. "squawk box" begins right now.
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good morning welcome back to "squawk box" here on cnbc we're live at the nasdaq market site in times square i'm andrew ross sorkin melissa lee with us today. becky is off she'll be back tomorrow. let's start with a stock market's incredible turnaround during yesterday's session at this time, dow futures are down 500 points. everything was in the red. the dow recouping to finish all of there that in the red the comeback from mixed trade headlines. we'll have a lot more on what those headlines are saying and what's behind those headlines a little bit later we are indicated lower the dow looks to lose about 121 points a


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