tv Worldwide Exchange CNBC December 31, 2019 5:00am-6:00am EST
it is 5:00 a.m. at cnbc global headquarters. investors look to close out a record year for stocks carlos ghosn on the run. the ousted nissan chairman has fled japan the chinese tech giant faces continued u.s. crack down. the fed's repo strategy. steps to keep issues from the lending market from throwing a wrench into the markets.
and ringing in 2020. parts of the world are already ushering in the new year as the final "worldwide exchange" of 2019 begins right now. >> a very good morning to all and welcome to the last day of 2019 a very happy early new year. i'm in for brian sullivan. here is how your money and the markets are showing up this morning. showing the markets will open slightly higher. the s&p 500, the dow and the nasdaq all on track for strong gains. nasdaq could finish the year with gains of nearly 35% turning to the bond market currently trading at 1.903%. in asia, the markets in japan.
remember they were closed today. japan notching gains of 18% for the year the shanghai composite finishing up about 0.33% and the hang seng is up about 10%, which is less than a lot of the other benchmarks let's look at what is happening in early trade in europe and joumanna bercetche joins us now. >> thank you in line with other markets activity volumes are down about 40 to 50%. not all european markets are open today the picture is some what negative the uk ftse 100 down about 30%s. about 0.4% weaker on the year. the cac flat, the spanish index also down. this is not telling you the full
picture. the stoxx 600 year to date is up 23%. this is the best performance for european markets in a decade the uk ftse 100, starting with that today, we are down 0.4%. year to date, we are up 12%. what a year for the developments general election and change over in leadership. all eyes will be on the brexit date of january 31st new discussions about the future trading relationship something to watch out for the big bounce around 4% what about germany you can see year to date up 35%. also a big performer we have spent a big part of 2019 talking about the manufacturing back drop given the exposure to the trade war.
you can see the german index as well had a stellar performance in line with global equity markets. >> what are the investors going to be talking about in the new year you are coming off perhaps best year in a decade >> absolutely. i mention brexit the story that will be with us for a long time. we have the crucial discussions. certainly, the pound, sterling investors have been watching those closely as well. one thing i would watch out for is what would happen on the fiscal spending side of things nine out of ten in the last 10 years, we've seen europe tighten fisc fiscal spending. perhaps this will be the year they start spending a little more the ecb are conducting a
strategic review perhaps you will see a redefined outlook coming out of the central bank certainly would be a big driver. it may be hard to repeat the performance we had in 2019 for many of the stock markets. i'll throw it back to you. >> some people saying about the markets here looking ahead to 2020 on this final trading day of the year. coo of commerce capital joining me on the phone. good morning >> good morning. >> we just heard from joumanna i feel like the theme over the last year has been such a block buster year here in the u.s., what do investors need to know going into 2020? i think there is a lot of good news it caught everybody but
surprise the stock market is a leading indicator not a lagging one. this big rally is telling us is hey expect increased earnings growth going forward we'll continue to see a rally at least three to six months going forward absent some kind of circumstance or big event. there are a lot of big things going on you had a wage growth, christmas, maybe the first phase of china negotiations. very strong mortgage industry. at least maybe a bottoming out there is a lot of good things going on in the economy to support this market. >> you mentioned errings growth, are fundamentals keeping up with the rally. we have seen the growth of 1.1%. profits expected to grow 9.5%. do you think that pace is achievable >> i think it is getting carried
away in different sectors. it is a good time to be a stock picker and choose wisely where you are going to be if you look at netflix for example or the tech sector which is up 50%. maybe you need to go look at some other sectors that banking looks very strong. it doesn't look overvalued you still get a dividend yield it is still very strong. i think picking and choosing might make some sense. the netflix thing is really going to probably start to play out next year versus disney and amazon and apple and at&t. some of those stocks i'd rather be in than the high valuations you see in netflix >> but disney has done very well are you expecting sort of a pull back from netflix's or taking the best performing stocks of
the decade >> i think some kind of paired trade. we are selling netflix and buying one or the other right now. >> even though they've run up so much this year disney up 31% year to date >> exactly i'm okay with that disney has a strong support and accounted for a huge sector of the film industry this year. almost 50% they've done really, really well netflix has a huge advantage in being a first market mover there is no barriers to answer >> tech as a whole has done very, very well. stock picking has been really easy this year i think 90% of the stock companies in the black what are you doing this year are you rotating out of the sectors that are performed very well into some that vrnt
>> some. i like apple over amazon apple is up 85%. it is not really overvalued. super strong, loaded with cash amazon's pe is way above its historical mark. you can rotate even inside the sector and still be in a lot better shape >> why are you cautious on amazon >> a lot lower pe ratio. >> you don't think amazon going into other business entities will make that stock go higher >> relative to amazon or apple, i would rather be in apple apple has gone up tremendous amount at the same time has a much stronger core fundamental position to support any kind of pull back.
>> perhaps the 5g advantage. thank you for being with us. appreciate it. >> you bet thank you. happy new year >> let's look at some of the other top stories. huawei is forecasting a rough road ahead the company announcing sales were up 18% to $121 billion for 2019 a record but also below expectations the chairman warned that 2020 will be a difficult year for the company adding that survival will be huawei's first pry ority. uber and post mates are suing california in a legislation that would force them to treat drivers as employees. the matter set to take effect early 2020 the suit claims that the new law violates guarantees of due
process because of how it targets some workers and companies. u-haul will announce a nico teen-free hiring policy. no smokers, no vapors. current employees will not be impacted by the new rules. when we come back, nissan's former chairman on the run the latest on carlos ghosn fleeing japan. plus protesters in hong kong are set to ring in the new year with a new wave of demonstrations new figures on just how many model 3's tesla plans to crank out of the shanghai facility
powered by our gig-speed network. because beyond technology... there is human ingenuity. every day, comcast business is helping businesses go beyond the expected. to do the extraordinary. take your business beyond. welcome back you are looking at a live shot of new york time square, the calm before the storm. this will be one of the busiest places on earth tonight. you don't go close to there, do you? >> i don't i have i won't do it again. my director telling me, there are already people milling around >> let's get the party started in other news, former nissan chairman carlos ghosn has fled
japan. rahel solomon joins us he's going to be celebrating his new year's eve >> he did flee to lebanon saying he wouldn't be held hostage by a rigged system in japan really shaken theauto industry ghosn was first arrested in tokyo last november on charges of hiding income and enriching himself through payments at dealerships in the middle east it's revealed he understated his salary only to be arrested again weeks later and then again in april. he holds french,brazilian and
citizenship. he has no passports. his lawyer said he still has his passports. lebanon does prohibit the extra diction of citizens meaning it is unlikely he will be forced to return to japan. he has remained zdefiant. he said he can now communicate freely with the media. >> that will be an interesting interview to kick off 2020 how does something like that happen did you say $9 million bail? >> that is the question. it looks like he left on a private plane.
he is in lebanon with his wife, carol and outside of their home are armed guards they will be looking at how did that happen. he doesn't have passports and it is stated that he was supposed to have surveillance >> he is sort of a lebanese celebrity. his face is on a stamp there >> to them, they have a stance and that tends to be more pro carlos ghosn. >> now he's a celebrity fug tiff still on deck, the new year set to usher in a key of changes in the world of sports which stock ranked as one of the best performing of the decade.
take a look at this chart. up whoping 4,000%. >> announcer: today's big number $62,330 million. that's the highest in five years but well below what analysts were expecting enjoy myself all day long. i wake up every morning to see how much weight i've lost and how much better i look. myww join for free + lose 10 lbs. on us.
welcome back the new year means big business in the sports industry looking at what is ahead for the industry 2019 was a big year for sports business from california voting to pay college athletes sports gambling spreads. continuing to grow across the country. more states will legalize sports betting bringing the number closer to 20 states. teams will sign growing number of partnership deals with casinos and online sports books. second, waiting for payments the fight for college athletes to get paid will continue to drag out the ncaa will be working on rules and policies
other states will bring their bills forward. lawyers will be busy the process will go slower than many fans anticipate schedule changes are coming. many leagues will try and push through major scheduling changes to keep up with the declining tv rating adding and in season tournament. the nfl might add a 17th regular season game and nascar might alter the schedule to move into more urban markets >> the new year, new decade twist on this morning's stock to watch. we are zooming out we'll check out the top performing dow components over 10 years most of these stocks joined during the decade. apple up 868%. united health gaining 864%
visa up 759% the payment space has been very, very hot home depot, 651% and nike adding 510% the bottom five in the dow would be ibm gaining just 1.5% exxonmobil, goldman sach looking at the s&p, netflix up more than 4,000% at the start of the decade, they were still sending out red envelops of dvd's what a run it has been the question is, can they repeat that in the next decade. also s&p winners, marketaccess up 2594%
and biomed >> the bottom of the list here apache, freeport and devon energy coming up, a dangerous situation in australia as thousands are evacteuad. wrec "worldwide exchange" is back in just a moment. but nothing could be further from the truth. americans are compassionate and hardworking. we aren't failing. our politicians are failing. that's why i'm running for president. to end the corporate takeover of the government. and give more power to the american people. that's how we'll win healthcare, fair wages, and clean air and water as a right. i'm tom steyer and i approve this message. ♪ yes i'm stuck in the middle with you, ♪ no one likes to feel stuck, boxed in, or held back.
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welcome back, you are looking at a live shot of capitol hill an election year certainly investors will model that into their fraft. let's check on other headlines frances rivera is in new york with the latest. >> we want to start with new details on the case of the new york city stabbing attack that happened filing federal hate crime charges against the suspect. the 37-year-old walked into a rabbi's home and randomly stabbed seven people one of the five victims remains in critical condition. >> in australia, preparing for new year's celebrations. people are facing serious danger brush fires are raging in some populated areas. four people are reported missing
and a firefighter was killed when winds flipped his truck reporting columns of smoke over eight miles high the concern is for the roughly 4,000 people trapped on the coast. >> watch this video of three men walking through the street in is stan bull. the strong winds bring the tree clashing down. two vehicles were severely damaged but thankfully no one was hurt those are your headlines on this last day of 2019 >> a happy new year to you >> you too >> i hope those guys are celebrating tonight. still ahead, investors are gearing up for the final trading day of 2019. we are breaking down what the new year may have r fothe markets. more of "worldwide exchange"
titles some might surprise you. it is the last day of the year you are watching "worldwide exchange" on cnbc. welcome back happy new year's eve here is how your money and investments are looking right now as we are half way through the 5:00 hour. stock futures are pointing to a slightly higher rebounding from yesterday's pull back. on track for the best annual performance in six years on track for gains of about 28% if it can jump above that 30% gain mark it would be at the best performance in a decade. looking at the yield sitting at 1.92%. looking at the asian markets as
well the shanghai composite finishing up and the hang seng lower by about half a percent taking a look at european markets, also on track for a very good year germany and italy are closed today. the ftse 100 up about 0.2% we'll go to rahel solomon for more >> turning to economic data out of china the pmi coming above expectations prodemocracy protesters are staging new year's eve rallies they plan to deploy more than 6,000 officers in a message today saying the unrest has caused sadness, anxiety, disappointment and rage. >> reporting that north korea
hackers stol sensitive information in the u.s., japan and south korea. they have taken control of web domains. according to some reporting, apparently some of those used information on social media to target their victims not a pretty sight there >> over the course of the last few months, the federal reserve has been flooding the repo market the move was aimed as avoiding a repeat of the turmoil when stocks went back to september. the move could create new problems as the year wraps up. some banks take their risk taking here to break it all down, the senior fixed income strategist and allocation for ubs >> thank you happy new year >> how are we going to stay awake. >> i have my make up done
already, so i'm good >> exactly why do we care about the repo market >> one of the things, the repo market is an important part of plumbing in the financial system it is the cost of capitol. the economy and corporations it has been ignored for some time something good did come out of september volatility, which is people did take notice >> you said this could create some risk going into 2020. >> first it started off with open market operations, which it did precrisis. going within the band that is now the 150 to 175 you still have the supply and demand imbalance we have a lot of treasuries issuing to pay for that. the primary buyer of that are
primary dealers. they've had financial constraints. going forward, it will have this heightened concern and over the fact that to make sure these leverage accounts you don't have to unwind the positions. >> during the last few years, the federal reserve has become more politicized is that going to affect what they may do in terms of repo rates next year going into an election >> i don't think so. at the end of the day, we did a piece called contained volatility one of the reasons it was contained is because the economy is doing so well i don't think it will have any influence. i do believe the fed has more of a watchful eye on the appropriate levels of reserves they may have miss judged early on but it doesn't have anything to do with the election.
>> let's talk about the macroenvironment those fears have faded away. a lot of wall street talking about the gains for the s&p 500. it was interesting we got a letter that huawei sent to his employees saying that next year would be very difficult. they had to percecontinue we don't know what will happen next year. >> i think you are right mortgage sentiment has become more positive. it underestimates the amount we will see from 2020 with the trade deal and how further they could go a lot has shifted towards trade and election heading into 2020 i think you are right. there is a bit of complacency
>> is that complacency it looks like brexit will be pushed through do you think there are any events that could flair up >> what we saw between the tweets and the headline risk they know how to deal better with it now. they've had it from time to time i don't think people could sit back and ignore. it might have shifted in terms of what will be the driver i don't think they are complacent or assume everything is going to be fine with the trade deal coming forward. >> any black swan events >> the biggest risk you'll see next year in the inflation you know everyone is betting and
we believe this is quite strong. they shouldn't fall below expectation. it should be one of those issues not that we feel this way if they've been a large rise of interest rates the markets are not anticipating. >> leslie, thank you for being with us. happy new year >> happy new year. hope you make it to midnight >> i'll try. coming up, netflix releasing a list of the most watched shows and movies on its platforms. some names might surprise you. i think they are showing one from adam sandler, top of the list this chart will not be a surprise check out shares of the streaming giant this decade, up more than 4,0%00 stay tuned you are watching "worldwide exchange" on cnbc. ♪
here last night to see that huge christmas tree all lit up you probably want to avoid this whole area >> tonight, yes. >> the next 36 hours tech stocks have been some of the best performers of 2019. check out shares of apple up 886% what we can expect from the sector in 2020 >> reporter: tech is on a tear the best performing sector here are more. apple will make its 5g move. apple will unveil its own 5g iphone in september. it won't be just new hardware. expect new 5g enabled experiences, perhaps with ago
meant august meanted reality hardware spending soft evens. vendors from dell to hp have highlighted macroeconomic challenges that could be bad news but good news for others like microsoft and amazon and zoom technology that could be cheaper for corporate customers. >> third, make or break wearables. now time for rivals to make a choice google plans to buy fitbit or introduce competitive products like microsoft with new surface ear buds coming in the spring. >> let's find out what else you'll be talking about today. time for the top trending stories. i really love this segment
it gives me something to talk about. >> it is very fun. this is always a big talker. former president barack obama has been sharing a list of his favorite things. his favorite books and movies. now we are learning his favorite songs of 2019. >> number one, playing games by walker number two, big thieves. beyonce, springsteen and lilnas x >> if you know that summer walker song, it is hilarious listens to that song it is like a play on destiny's child "say my name." >> are these the songs he listens to all the time? i'm certainly not cool enough. >> i think he listens to these songs. >> i would prefer a list of his
top 25 most played songs those are good they are the ones you always listen to. this seems a little too perfect. >> no. i think he listens to this there is country, pop, some rap, hip hop. he's spoken very much about his love of especially old school hip op i'm with it. especially summer walker netflix releasing its own watched titles the top spot is the comedy movie "mystery." rounding out the list. stranger things, the witcher, umbrella mentality if you are surprised you are not alone. it is however worth noting the methodology. this list is ranked on the
number of subscribers who watched at least two minutes of a title. the reason they did this is because they felt like before it was discriminating against longer films >> it also helped put six of their original names on this list >> i didn't know you were such a skeptic. >> it is an interesting list it is fine adam sandler, jennifer aniston top spot i'm not going to argue with that when you need to watch something. have you seen most of them >> i have seen nothing nothing on this. "orange is the new black." you know, i'm so busy working. i don't have time to watch netflix. i am an "orange is a new black"
fan. a bit of an announcement carry underwood will no longer announce the cma awards ending her 12-year run. that is a long time. i can understand she wants to perhaps spend her time doing other things >> i just can't believe it has been longer than that since she won american idol. some of the younger folks may not knows that how her career started. >> we are old enough to know that >> which is crazy to stay. rahel, thank you >> wishing her the best. >> happy new year. >> happy new year. good to have you here. >> thanks for having me. we are hours away from starting the new year in some parts of the world. here in new york, tens of thousands of people will crowd
times square chris has a spot already don't tell me you are staying there the next how many hours? >> maybe i'll get a little break. it is the city that never sleeps, of course. this is the square that never sleeps a lot of preparations going on we are seeing people head back to their hotels after the prenew year's eve scelebration. the weather is supposed to be good last year, you might remember it was pouring rain at midnight first time that happened in 24 years. the year before that, second coldest new year's eve ball drop 9 degrees. i remember that one. the nypd says this will be the safest place to be in the world
tonight. 1,000 police officers both plain clothes and uniform. they are in all the buildings and hotels surrounding times square they'll have to go through multiple players of security checks to get into these metal pens once in, they are not allowed out. it will be safe. the weather looks good a good night to welcome in 2020. >> sounds like you've been doing this for a few years you've been through the cold and rain if i'm traveling through the city today, when do the crowds really start to ramp up and ramp down >> you know, the nypd says 11:00. in past years, we have noticed that people really start getting into those front pens closest to one times square at 7:00, 8:00
in the morning it is unreal because they have to stand there upwards of 15 hours or more. i think that 11 or noon, you can get a place where you can see the ball after that, you are down close to the park and it is really a rumor. i think by noon or 1:00, you'll be okay. if you want to do it, god bless you. i could never do it without being able to leave. >> i'm asking so i know when- t avoid it thank you. very happy new year to you coming up, on the run, carlos ghosn was awaiting trial in japan and under severe travel restrictions so how did he end up in lebanon? that story when "worldwide exchange" comes right back y mys. y mys. i wake up every morning to see how much weight i've lost
welcome back the headlines just in 60 seconds. ousted nissan chairman is you now in lebanon it is unclear how he left because his passports were being held by lawyers. in a statement, he said quote, he has escaped injustice and political persecution. tesla is reportedly producing 1,000 cars per week, that is 28 per hour. they started delivering cars in a ceremony in china yesterday. >> in other auto news, the first edition of the high end electric mustang has sold out and it will no longer take preorders for the
mach-e back to the markets on this last trading day of 2019 it looks like they will start new year's eve on a positive note the dow currently implied to open up about 40 points. potentially best year in six years. joining us now, chief market strategist we've seen basically zero earnings growth people are looking for consensus
up 8 or 9% we always know at the beginning of the year, things are too high that will be hard to see i don't think anybody is really looking for another 30% rally. i think it will be more important to stock picking and group picking outside the u.s. and stocks it is also important if you want to achieve the new double digit growth. >> what are you look at next year looking at back in the summer in august >> how that looked good. beaten down groups caution for a couple of years.
same thing for energy stocks i think the rotation to some of the groups, they are starting to get more popular but spent most of the time more unpopular if oil doesn't have to rally more not only has energy stocks underperformed the group, they've underperformed the oil they start the year very strongly and pile in >> it has been the outperformer. >> on a short-term basis a lot of these names are
overbought netflix and facebook if they can break out further the key is that it is a presidential year a lot of these guys especially google facebook and amazon with these bipartisan issues, it will be tougher for those stocks to do a whole lot better my point is here, if you like those favorite stocks and you can put some new money toward the year, it will see rough patches and better entrance points >> some of the names you mention, facebook has been facing scrutiny and pressure investors don't seem to care at all. do you think it will come to
something and get regulations in these performance? >> you don't always need to have the actual regulation. we saw that in the health care stocks especially the bio tech stocks when they really started to hammer down on regulation the bio tech etf and names really overbought with a huge rally they sold off nearly 20% in the last half of 2016 and first half of 2016. the tech stocks are overowned and may be more vulnerable i'm not saying dump the group. in the group, it is still very high we need to be careful, i think >> matt, very quickly. since it is the last day of
2020, what is your best idea for the year ahead >> best idea still is the energy sector, also commodities one thing about the dollar it keeps flirting with breaking down below its trend line. if the dollar breaks down in a meaningful way, it will be bullish. look for that. >> thank you happy new year to you. that's it for "worldwide exchange" for the year happy new year to you. good morning and welcome to the final trading day of 2019. we'll show you how stocks are reacting after yesterday's dip >> uber and post mates filing suit against a california law. it has big implications for the gig economy. gone, gone ghosn carlos ghosn is on the run fleeing house arrest in japan
and landing in lebanon where he says he escaped injustice. i don't think he can extradict from there it is tuesday, december 31, 2019 "squawk box" begins right now. ♪ good morning we are live from the mart the dow dropping 183 pointsing believe it or not. that was the worst day in four weeks. the decline that tells you where it has been headed
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