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tv   Worldwide Exchange  CNBC  February 4, 2016 5:00am-6:01am EST

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oil shock. crude prices jumping on dollar weakness and opec rumors. >> and new this morning, credit suisse posts its first loss since 2008. >> and the end of an era. sumner redstone stepping down at cbs. are major changes up next? "worldwide exchange" begins right now. good morning. welcome to "worldwide exchange" here on cnbc. i'm sara eisen. >> i'm dominic chu sitting in
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for wilfred frost. another busy morning in the global markets. we have it all covered for you. >> we start with breaking news from the european central bank. mario draghi has been speaking at the german central bank in frankfurt. among the headlines here, draghi say, quote, there's no reason for central banks to resign their mandates simply because everyone is being affected by global inflation. central bank speak for the risk of acting too late on ultra low inflation is greater than that of acting too early. draghi suggesting a wait-and-see stance could lead to a lasting loss of confidence. seems like he's making a political argument here for moving further, something he's already hinted at doing in the march meeting in terms of easing to fight slow or no inflation. >> he's mr. whatever it takes. this guy will say whatever he needs to. he's a big talker for sure. staying on the europe theme, check out shares of credit suisse. the stock is dropping to a more than two-decade low.
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they're down 13%. the swiss banking giant posting a massive fourth quarter loss. also announced 4,000 job cuts. we're going to hear from the bank's ceo in about 15 minutes' time. >> boy, have european banks been at the center of this global wall of worry. >> just take a look at those right now. deutsche bank notably higher today. it's been under pressure. barclays as well. but ubs and credit suisse, r taking it on the chin. >> and deutsche bank being hammered. let's show you the global market picture this morning. after a rally yesterday, a strong turnaround. now we're building on those gains in the early market action. the dow futures right now suggesting an open up 95 points. s&p futures up 12. nasdaq futures up 31. can this rally be sustainable? that will be the question. futures have been known to flip around. yesterday they were all over the
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map. so was the trading action. >> even digger the regular season. of course, we're going to take our cues. obviously we have an interconnected market. those places right now are really showing signs of life in today's early trading. >> strong crude, weak dollar, strong stocks. you're seeing it over in europe as dom just suggested in the early action, especially from the u.k. this morning, where the ftse 100 is up more than 1.5%. the german dax trying to eke out almost a 1% gain here in the early action. italy coming back strong as well. some of the banks there have been a major source of problems. and in china today, the peoples bank of china did set its official yuan midpoint rate at the strongest level in more than a month. that was cheered and it really came after the dollar index. the dollar broadly fell to its lowest level in three months. that helped shanghai gain 1.5%. japan's nikkei was the weakest of the bunch in asia because that strengthening yen. it is all about the weaker dollar. hedge fund manager kyle bass raising his concerns on china
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during a cnbc interview. listen to this. >> i believe the cause of the problem is, number one, the real effect of exchange rates since 2005 has aappreciated 65%. they've let their banking system grow 1,000% in ten years. it's now $34.5 trillion, including nonconsolidated assets on their banks. >> doom and gloom from kyle bass, who is working very hard to short the chinese currency. the hong kong dollar. and is betting this is going to break and problems in the chinese banking system are going to come to the fore. just one of the problems we've been hearing about this whole global market selloff and global growth. >> the last couple weeks, china's become such a focus about those stories about how hedge funds are trying to actively seek to make money by shorting the yuan and all those other trades related to what's happening in china. it goes to show you, it may be out of the top line headlines, but china still a huge part of
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the story. and one of the big reasons why is because china is the second biggest consumer of oil out there. if you look at oil prices this morning overall, you can see at least a green trade right now. brent crude, the u.s. benchmark trading $32.70. the last trade there up by about 1.3%. ice brent crude futures, the world benchmark for oil prices, $35.37, up by about a percent. natural gas, $2 right now. that's off by about 1.5%. late yesterday, venezuela's oil minister said six crude oil producing countries, including iran and russia, support conv e convening an emergency meeting between opec and non-opec members. this according to a report from iran's oil ministry news agency. meanwhi meanwhile, a couple major energy companies posting some results overnig overnight.
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>> staoil announcing it will cut capital spending to $13 billion this year from nearly $15 billion in 2015. but it's keeping its dividends steady. another theme there, sara. many of these oil ing to preserve that dividend. statoil ceo speaking to our colleagues earlier this morning. >> that's a very important part of our message today. we're preparing ourselves to invest in the highly attractive port foe yoel. actually, we've taken down the breaking prices for the nonsanctioned portfolio that's up for sanctions from around $70 per barrel to $40 per barrel. we're preparing to invest and have the financial capacity to do that combined with maintaining a dividend. >> asset prices have been coming down in value. it will be interesting to see whether or not certain large players can capitalize on that
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particular move. >> a lot of people are saying the rebound in crude oil we saw yesterday and into this morning has to do with the strong dollar, which has really taken center stage just over the last 24 hours or so and continues to weaken. let's show you what's going on right now. foreign exchange trade is 24 hours a day. weakness in the dollar, especially against the euro. look at the euro, zooming all the way up. we're basically back to levels we were at a year ago. this is some relief for corporate america, the cfos dealing with that strong dollar head wind. some relief there. also keeping an eye on the dollar-yen. the yen strength has been a major source of anxiety for investors around the world. it's been one reason they've been selling off stocks. the ten-year treasury note yield. some relief there as well. the opposite happened yesterday. >> still though, below 2%. not a great outlook for the growth picture. >> and have you seen gold? back to november highs on gold. a real surge in that commodity.
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we also have seen strength in copper lately, which a lot of people see as a good thing. the overarching theme right now in the markets is all eyes on the federal reserve. >> sure. absolutely. >> saw draghi talking about easing potentially in march. we saw japan go to negative rates. fed is up next. there's now a 60% chance in the futures market that the fed doesn't raise interest rates anymore. >> at all this year. >> which is a sharp change. >> the probabilities are interest right now in only because it goes to show you about how things can move in the market and how it can at least change expectations for how policymakers move. it's chicken and egg, though. also, breaking news overnight. sharp says it's entering exclusive takeover talks with foxconn. sharp shares rising sharply. forgive the pun, please, sara. >> i always expect puns from
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you, dom. >> and foxconn unchanged right now. at least those are the adr, gdr markets. >> the corporate buzz story of the morning, it's the end of an era as sumner redstone resigns as cbs executive chairman. landon dowdy joins us with more on this story and some uncertainty. >> that's exactly right. good morning. the 92-year-old media mogul has stepped down at cbs. viacom is also reportedly expected to change redstone out of the role of executive chairman, but a final decision won't be taken until the company's board meeting thursday. shareholder pressure has been building, as many have questioned redstone's health and ability to lead the firms. he's been absent from annual meetings and is currently facing a legal battle after his former companion challenged his mental capacity. analysts don't expect the move to have an immediate impact on the company. take a listen. >> i don't know that it necessarily says anything
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happens at viacom any time soon. it's possible. i think some of the court cases that play out might push that further faster. but i don't think it necessarily means it's going anywhere at this point in time. >> redstone's daughter saying in a statement, he's clearly established himself as a creative and effective leader. over the past year, viacom shares are down 30% but both trading higher in after hours. >> landon, thank you. we have a few stocks to watch today besides what's happening with viacom. gopro shares are plunging after the company posted a surprise loss. the wearable camera maker also forecasting current quarter sales well below wall street estimates in announcing it appointed a new chief financial officer. yum brands quarterlies came in mixed. revenue missing consensus. the owner of pizza hut also announcing some executive changes of its own, appointing an interim cfo. sales benefits from strong results out of the kfc in china.
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shares up fractionally in the premarket trade. bucking the trend, take two interactive posting strong results on the bottom and top lines. those shares you can see here moving as well. a few more stocks to watch on that side of things. >> we've got shares of nobel corporation rising. its quarterly loss was smaller than expected, helped by a payment related to the termination of a rigged contract. as you can see, shares have taken a nose dive on the price of oil. sticking with the energy theme, weatherford international announcing job cuts. the oil field services provider will eliminate 6,000 positions, which equates to about 15% of its work force. shares there unchanged in the early action. and buffalo wild wings reporting disappointing results. the wing chain blaming holidays for soft same-store sales. the stock is higher in the premarket. a programming note, don't miss the chain's ceo sally smith on "squawk box" later this morning at 8:40 a.m. eastern. they'll talk about those results
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which were disappoints and look ahead to the super bowl, which is their biggest day of the year. >> it's a big time for wing manufacturers overall. shares of astrazeneca under pressure right now. the fourth quarter earnings falling short of estimates. as for this year, looking for low to mid-single digit percentage declines in both revenues and profits. >> now to today's market agenda. a day ahead of the monthly jobs report, we get a trio of economic reports. these numbers move marks. weekly jobless claims out at 8:30 a.m. eastern time with first-time filings for unemployment expected to hold steady at 278,000. also at 8:30, look for a read on fourth quarter productivity, which is forecast to drop at a 2% annual rate. that will drive labor costs up more than 4%. at 10:00 a.m., we'll get december fact ri orders data. and in dwroourp, there's a bank
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of england decision due at 7:00 a.m. eastern time. no change expected. earnings to watch, conoco-phillips reporting before the opening bell. we'll also here from linkedin, news corp., and lions gate. >> a jam packed day. coming up, european bank fears. we're going to head to zurich, switzerland, and hear from the ceo of credit suisse. >> first as we head to break, we want to hear from you. our twitter question this morning, which asset class is leading the market moves anyway sm is it stocks, bonz, currencies, or commodities? tweet us @cnbcwex. the answers are coming in. i say currencies as of the last 24 hours. it's been dollar weakness, a good thing for stocks. we want to hear from you. we'll share your results later in the show. you're watching "worldwide exchange" on cnbc. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities.
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welcome back to "worldwide exchange." if you're just joining us, let's get you up to speed on the markets. as you can see on the map behind me in asia, there's only one spot on red. that's in japan. it gives you an idea of the sense in the overall market today. the nikkei the lone decliner among major economies in the region. the hang seng in hong kong up by a percent. the shanghai composite up by about 1.5% as well. let's take you through what's happening on the commodities side of things with the oil market overall. wti crude, $32.54, the last trade there, up by nearly 1%. ice brent crude futures, $35.09,
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up by about 0.2%. futures in the united states showing signs of life as well. dow up by 77 points. s&p up by eight. nasdaq futures up by about 21 points. good for about maybe a half a percent move here. again, some green across the screen. we'll see if it holds into the opening bell. >> dom, thank you. now to european trading. broadly higher, but credit suisse shares are getting slammed this morning. julia chatterley joins us from the bank's headquarters. >> reporter: an interesting week. credit suisse posting a bigger net loss than expected in the fourth quarter and a bigger net loss on the year overall. they also posted revenues down almost a third.
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it's raising questions about their ability to meet some very ambitious profit targets in the coming years. i picked up on the conversation we were having yesterday and what he thinks is going on in the broader banking sector. he had a pretty controversial view. listen in. >> i think it's a good time to buy banks. >> is it? >> yes. because really, you would have -- the world would have to come to an end. first of all, because of global banks, the important banks, we'll have raised $4 trillion of capital. we're completely in a different place. there's no scenario where banking blows up today. >> reporter: in drek contrast to what we heard from ubs on tuesday of this week, they saw net cash inflows in both their asia and swiss business. now, the ceo of prudential telling me this is going to be the key going forward. just listen to some of the short-term challenges in the outlook.
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china, oil, mutual fund redemptions, liquidity issues, and the divergence in central bank policies. they don't think this volatility is going away any time soon. 2016 is going to be a real challenge. ouch. guys, back to you. >> julia chatterley, thank you very much for a sobering report there on the state of the european banks live from zurich. credit suisses is the one getting hit overnight. >> 14%. it's a huge move lower for a massive bank on the european side of things. let's talk about the macro side here. today's trade of the day, all of this market volatility sending gold prices higher. futures are already up by almost 8% so far this week as investors seek that shelter in what's been known as a safe-haven commodity. our data team here at cnbc found that if prices for gold continue this up trend, gold etfs and certain stocks do benefit. the gdx, slv, and the gld, which
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is the exchange traded fund that tracks gold, all benefit in terms of the overall move higher. in terms of stocks, two names led the gains. newmont mining. they both have direct exposure to the metal. if you want to know more, go to cnbc. check out cnbc pro. >> so we asked on twitter which asset kwlaclass is leading the . dennis said gold. he said gold has been up sharply for the first five weeks of the year. it's rising in all currency terms, which we know he watches carefully. >> watches it in euro, yen. >> and he's happy to see dom early in the morning. tweet us @cnbcwex. when we come back, decision 2016. we head to new hampshire where presidential hopefuls are barn storming the state ahead of next week's primary.
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and it's throwback thursday. all of our music today fitting with that throwback '90s edition theme. we're taking requests. we want to know from you, what '90s music do you want to hear on "worldwide exchange"? >> i'm no scrub. >> it's very good. although "barbie girl" is better. first as we head to break, today's weather forecast from the weather channel's jen carfagno. >> on this thursday, we've got a front on the move in the northeast. finally breaking out some of this heat we've been having lately in the northeast. temperatures today are going to be dropping off a bit. you'll feel some drier air coming in. starting today, you'll have a lot of fog across eastern seaboard and some rain still left behind down into florida. middle of the country, dry weather. a lot of sunshine out there. a little system dropping into minnesota. not a big deal. mountain snow in the west. the northwest gets rain.
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we've got a good looking forecast coming your way for the super bowl. temperature-wise, a lot of folks still above average. a little cooler than lately. still fairly warm in florida, with temperatures approaching 80. that's the latest coast-to-coast forecast. the world 2116, you can fly across town in minutes or across the globe in under an hour. whole communities are living on mars and solar satellites provide earth with unlimited clean power. in less than a century, boeing took the world from seaplanes to space planes, across the universe and beyond. and if you thought that was amazing, you just wait. ♪
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good morning. if you're just waking up, let's get up to speed on the overnight action. oil is up, the dollar is weaker. that's helping stocks around the
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world. the shanghai composite closing up 1.5%. the nikkei was the weak spot with the weaker yen. still, the strong commodities, weak dollar theme is helping europe this morning. seeing green across the screens. 1.5% for the ftse 100. german dax, 0.6%. all of that helping u.s. futures build on the gains we saw yesterday. the dow closed up about 183. dow futures up 80. we are still seeing gains. s&p 500 futures up nine. nasdaq up 25. the bright spot in today's trade, and really over the last 48 hours or so, has been the currency market, where the dollar is finally starting to really weaken. we're seeing big moves. half a percent today. almost 2% yesterday on the euro. all the way up to 1.1158. some relief for corporate america and the american economy, which has been hurting by the strong u.s. dollar. >> absolutely.
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so sara, let's take that and pivot here from economics and finance to the world of politics. tonight is the democrats' final face-off before new hampshire's primary tuesday. things are heating up between the two top republicans. tracie potts is following it all live from washington, d.c. this morning. tracie, it's obviously headline grabbing, both sides of the aisle on the political picture here. >> reporter: pretty clear, dom, this is not iowa. new hampshire totally different ball game. the number shows that. you have donald trump with a double-digit lead in the polls in new hampshire. all the recent polls. and then bernie sanders, who call himself the jurunderdog, b that's not what the numbers are showing. tonight's minnesosnbc debate is hillary clinton's last chance to take on bernie sanders before the primary. sanders has a double-digit lead here. he's hammering clinton on her
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six-figure speeches. >> i do not know any progressive who has a super pac and takes $15 million from wall street. that's just not progressive. >> reporter: her response? >> i don't know, that's what they offered. >> reporter: the leading republican, donald trump, is claiming he could have won iowa if ted cruz hadn't sent out questionable mailers and spread false rumors that ben carson was dropping out. >> you know, these politicians are brutal. they're brutal. they are brutal. they are a bunch of dishonest cookies. >> i wake up every day and laugh at the latest thing donald has tweeted because he's losing it. >> reporter: marco rubio is going after cruz too. rubio is a close number three here. >> ultimately, i think it goes back to what i said before. and that is a willingness top say or do anything. >> reporter: the field is getting smaller. rick santorum just dropped out and endorsed rubio. now rand paul has dropped out. he hasn't endorsed anyone.
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neither has mike huckabee. those small amounts of support from these candidates who have dropped out could be the edge that some of these leading candidates need. >> and tracie, that's just where i was going to go. i was going to ask you about governor bush, about chris christie, about kasich. what happens to them if they don't have a good night in new hampshire? when do they start dropping out? what are you hearing? >> reporter: well, after new hampshire and maybe before south carolina. some of them are wanting to stay in through south carolina. it's not clear. it's totally up to them. it's when their support drops off, when their money runs out. we often hear that they don't have a lot of money left, that they've got volunteers, paid staffers who are working without being paid because of that. typically what happens is when you don't do well in a state, your funding drops off. your donors drop off. that has a huge effect on the campaign. >> and moves to someone who does better. all right. thank you very much, tracie potts in washington. in sports news, steph curry
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had another night to remember. this one in washington. he got hot early against the wiz arz, hitting 7 of 8 three pointers in the first quarter alone, scoring 25 points. he finished the night with a total of 51 points, shooting 19 of 28 from the field, including 11 threes. the warriors beating the wizards 134-121. the warriors are scheduled to visit the white house today. every sports update these days is what happened with steph curry. >> he's amazing. i'm not a fan boy of steph curry, but the numbers bear it out. the guy scores so many points. now his name is being interjected into the conversation about whether he could be with the all-time greats like a michael jordan or a lebron james. he's still very young. >> is he better than lebron james? >> well, listen, lebron was pretty good back in the day. you're from ohio. how can you say that? >> i know, but i've met steph curry. i'm wowed. >> coming up, this morning's big market moves. plus, wait until you hear what
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jose conseco, speaking of sports, is tweeting about. it's the japanese yen and interest rates. yes, you heard me right. stay tuned, sara. you're watching cnbc, first in business worldwide. sure, tv has evolved over the years.
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it's gotten squarer. brighter. bigger. it's gotten thinner. even curvier. but what's next? for all binge watchers. movie geeks. sports freaks. x1 from xfinity will change the way you experience tv. buckle up. wild market swings again today. we're talking stocks, bonds, commodities, and currency straight ahead. and gopro gone wrong. why shares are plunging.
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plus, attention, taylor swift fans. what the pop star has up her sleeve. it's february 4th, 2016. you're watching "worldwide exchange" on cnbc. good morning. welcome to "worldwide exchange" here on cnbc. i'm sara eisen. >> i'm dominic chu sitting in for wilfred frost. let's get to the global markets this morning. we are indicating higher for the opening u.s. trading. dow futures indicating a 67-point gain. nasdaq positive by about 23 points on the open there as well. take a look at what's happening in europe overall. green across the board. the dax in germany up by about half a percent. the france cac up by about one-third of 1%. that all stems from the positive action in asia.
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most markets there higher, except for you can see there the nikkei in japan off by about 1%. the hang seng and shanghai composite both posting better than 1% gains. >> as for the broader markets, that's the story here. watching some of these other asset moves to see whether the resilience in stocks can hold, like oil, which has been strong. it gained a lot yesterday. it's up a percent. wti in the early action here, 32.65. brent the international benchmark up just under 1%, even though we saw a bigger build in u.s. crude inventorienventories. the ten-year treasury note yield, selling in treasuries, pushing those yields higher. we'll see if treasury yields can go above that 2% level. they've been stuck below there. a reflection of the doom and gloom. the dollar weakness. that's been a real show stopper over the last 24 hours here. the euro has surged up. the weaker dollar is a relief
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for corporate america, for some of our nation's exporters, and it's helping. a lot of people say drive the price of commodities higher, which are priced in the u.s. dollar. gold has also been a story. at the highest level since back in november. it's been a steady march higher over the last five weeks. what dpoes it say about the fed? perhaps that the fed will not hike interest rates at all this year. >> from those big picture economic markets to what's happening with the top corporate stories. sumner redstone resigning as cbs' executive chairman. the ceo set to take the reigns here. viacom is also expected to move redstone out of that role as its executive chairman. a final decision won't be taken until the company's board meeting today. shareholder pressure has been building as many have questioned redstone's health and ability to lead both firms. you can see here shares of viacom, $47.57.
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cbs shares, let's take a look at those. in the extended trade, up by 4%. >> the interesting one to watch is going to be viacom. that's where we saw the sharp move higher yesterday in the after hours. the question, does it put it in play for a deal? >> consolidation. is it going to happen? >> a lot of change in this industry. >> you have perhaps this whole idea that the current ceo, his daughter, there could be a battle brewing there. that agitation you can see there sending those shares higher, 9% in the premarket. >> though david faber came on, who broke the story for us, and has followed this company closely. says maybe investors are getting a little ahead of themselves. a lot of the analysts writing overnight, it's just a hint of a change at this company that's got investors excited.
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we'll see what happens. in other corporate news this morning, apple ordered to pay $625 million in a patent dispute with vernatech. the tech giant used the patent licensing company's internet security technology without its permission in its facetime and i-message features. cisco systems is buying jasper technologies. the company connects devices it like cars and medical devices to the internet. internet of things. >> right, sara. now, on the executive side of things for transportation, delta announcing executive changes there. its president will replace richard anderson as chief executive officer. so an skbernl candidate. those shares off by about one quarter of 1% in the premarket trade. transportation stocks certainly a focus for many investors. also, shares of gopro taking a huge beating on disappointing earnings as the action camera maker can't seem to pull out of this nose dive. landon dowdy joins us with more.
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gopro, its wild ride really is huge. >> i couldn't have said it better myself. what a wild ride and free fall. the company missing expectations, reporting earnings of 8 cents a share, excludeing items on $437 million in revenue as rising competition and weak sales of its latest wearable camera weighed on its results. for the current quarter, gopro forecast sales of $160 million to $180 million. the company plans to release new editing software in march and said it would release its drone in the first half of this year as it struggles to find new sources of income. the stock tanking nearly 20% on the news and are down more than 80% in the last six months. guys, what i'm hearing is, sure, they're coming out with new products, but it's not necessarily about the numbers. it's not necessarily about these productings anymore. it's more about can they explain themselves and a transition more towards a media company and away from a hardware company. >> for now, no love from investors. thank you, landon.
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just in time for tax season, computer failures taking down several irs systems yesterday, leaving the agency unable to process some taxpayer returns. the irs says it is a hardware failure and they have started repairs. some systems will remain unavailable until later today. so taxpayers can work on their returns, but they can't actually submit them until the system is up again. the agency still hopes to process 90% of refunds within three weeks of filing. that's good news. >> kudos to you if you've already gotten your taxes done. >> who's done that? overachiever. we have top trending stories to share with you this morning starting with julian assange, founding editor of wikileaks. he said in a tweet last night he would surrender himself to british police if the united nations decides later this week that his detention in an ek we door yan embassy in london is, quote, legal. he's been confined to the embassy for more than three years after ecuador granted him asylum. the u.n. will deliver a ruling
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on friday. there were all sorts of complaints, like his mental and physical health are in jeopardy. >> also, sara, six pieces of jewelry from bernie and ruth madoff's collection are up for auction by the u.s. marshal's service. the collection is available online and includes more than 650 diamonds. the pieces start at over $20,000 each. officials are still trying to track down money stolen in the decades' long $64 billion ponzi scheme ran there. still, it looks like an interesting piece in terms of the next saga of the madoff scandal. now they're auctions off some of the personal items, jewelry encolluded here. >> nice items, if you don't mind sharing them with the madoffs. taylor swift is turning her likeness into a mobile game. the music star partnering with glue mobile, which is the same company responsible for kim kardashian's top-earning game, hollywood, which brought in $74 million in revenue in the first ten months. swift's game will be out by the end of 2016.
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glue mobile's stock is up, but important to note, this is a small market cap company. we don't really cover it. but boy, are they getting a boost from some of the top commercially appealing celebrities. >> we already knew taylor swift made it. you really make it when you have an app or game on your smartphone created for you. >> absolutely. >> and here's one interesting one. former major league baseball player jose conseco chiming in on the negative interest rates in japan. a former ball player tweeting about it last night. you can see here, negative interest rates in japan, it's blowing my mind, says conseco. he goes on to talk about the yen and how you cannot stoke inflation, or they have no hopes of stoking inflation with those policies. but it's interesting here. who is advising japan, says jose conse conseco, forcing banks to lend all. >> who is advising jose? where is he getting this? >> the bank of japan should call
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them willie wonka bonds. so weighing in on negative interest rate policy. >> i think it's a reflection of the fact that as global central banks continue to take us into unprecedented places and risk your policies, there's a lot of awareness of it. and there's a lot of anger about it. there's a lot of awareness that debt loads are increasing. it is bizarre. >> i watched jose conseco. i grew up in the bay area. they were the bash brothers. they hit home runs. but interesting commentary on the bank of japan and negative interest rates. up next, our must-read stories of the day. is mike bloomberg a serious contender for the white house? >> that buzz keeps going. and how a new fcc rule on liquidity could make mutual funds more risky. you won't want to miss that warning. cnbc's "worldwide exchange" will be right back.
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welcome back to "worldwide exchange." investors in u.s. based mutual funds pulled over $6 billion out of funds that specialize in u.s. shares last week. that's the biggest outflow in six weeks according to the investment company institute ici. this as inflows into foreign focus funds have seen their fourth straight week of new demand overall. now, we're going to stick with the mutual funds side of things. that brings us to today's must-reads, catching our today.
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i'm watching a story in "the wall street journal." they're writing mutual funds are risky. that's the headline. this on the heels of a new liquidity rule by the securities and exchange commission. here's how the rule works. the idea is to make sure that funds have plenty of assets on hand that they can easily sell if they need the cash or to meet customer redemption requests. specifically, this is to find out which funds can be sold quickly without materially affecting their price, and the real issue here is whether or not some of these new rules will hamstring mutual funds in times of crisis when they can't really do things when they're supposed to. so say you have a threshold. you can't buy more than a certain type of risky asset. if things really go down and you want to put money to work, find opportunities, that sort of thing, it could have a lot of real ripple effects that may not be as positive. >> at a time where a blackrock recent survey showed because of the market volatility of 2016, more are pouring money into mutual funds, away from the etfs.
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>> absolutely. >> an interesting warning. my pick also in "the wall street journal." i turn to politics. keeping the bloomberg hope alive. why mike bloomberg can win, he says. and remember, bloomberg hasn't announced any candidacy. he says the share of voters that identify as independent in this country hit 43% last year. that's a new record. moreover, 60% of americans told gallup in september that the republicans and democrats do such a poor job representing them, they want to see a third major party emerge. why i picked this quote, it was on the numbers. clearly you can go to the piece and read, which we've heard before, all the reasons he says. i mean, he's a bloomberg guy. why bloomberg is the right fit during this kind of election. >> it's a shock to me. so almost half of americans identify as independent and not
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part of the right or left. >> which also, he suggests, is not representative of votes like the iowa caucuses. >> sure. >> or the new hampshire primary. it's more geared toward the general election. we'll see if bloomberg does announce. we're just about at the top of the hour. that means joe, becky, and andrew are hard at work, prepping today's edition of "squawk box." joe joins us from midtown manhattan. what are you reading? >> i'm thinking about big gulps. the idea of a nationwide nanny state is a little threatening to my own personal libertieliberti. actually, i knew jose, the bash brother as well, dom. he's a very smart guy. used to watch cnbc. i played with him in celebrity golf tournaments. >> can he hit the ball far? is he a big hitter? >> but he's smart. i don't think anyone had to advise him on monetary policy. you know who used to be part of our -- we had a stock picking --
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celebrity stock picking thing on wa "squawk box." johnny bench knew -- he watched all the time, knew all the stocks. he did pretty well. >> but did he know monetary policy and the impact of negative interest rates? >> what i always say is how do people watch other morning shows where -- i mean, how many recipes can you watch, or how many glue stories can you do? how come everyone doesn't watch to see what's happening in the actual world in terms of central banks? i'm surprised that we don't have 100% ratings. >> there's only so many ways you can make a quiche. >> only so many ways. how are you not watching c ininn the morning? as far as everything else, foul is fair, fair is foul. the market rallies yesterday on the notion the economy is so weak we probably won't get another rate increase.
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or oil goes up 7%, 8%. let's buy some stocks. it's just weird. the dollar goes down. let's buy some stocks. it's weird. i don't know how long these correlations last. yesterday we heard that the correlation used to be 85% of the time oil prices went down, stocks would go up. now 95% of the time, oil prices go up, stocks go up. we're in this world where correlations that were historically would work -- 5% unemployment used to mean you'd be at 5%, 6%, 7% on the ten year. now 4.9% unemployment means you're at zero. i don't know if jose could comment on it that. i don't feel any smarter than him in figuring this stuff out. >> i'm definitely not smarter than jose on this front. i'll defer. >> i have a signed bat by him. i keep it under my bed in case -- you know, for whatever. >> do you have a mcguire one? >> this is before all the juicing stuff. the more we hear, dom, i don't
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know how widespread it was, but -- i don't know. i don't know who to trust numb. i don't know if i'd definitely say these guys are really bad guys. they're trying to stay healthy and do their best. we expect a lot from them in terms of they're our warriors. it's a tough subject. >> absolutely. >> joe, thank you. we'll see you at the top of the hour. kba baseball, soda correlations. >> everything. we're going to talk about the drop in the dollar and ask if the trend is here to stay. plus, we're taking music requests right now. this is one of my favorites. we want to hear what you want to hear on "worldwide exchange." go to our twitter page. it is throwback thursday. get the link. go to our spotify collaborative play list right now. we got some mc hammer playing. >> best of the '90s. stay with us.
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the u.s. dollar weakness is a big part of the market moves this morning. joining us now to discuss is it
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the managing director, forng exchange strategy for bk asset manage. kathy, the dollar has really taken center stage over the last 24 hours. what is driving the weakness? >> i think it's quite simple. the market is bawaking up to th notion that even though around the world many countries are moving to negative interest rates, easier monetary policy. here in the u.s., all of the global market development is going to cause federal reserve to slow down as well. it hadn't accounted for that because they were so focused on what was happening abroad. i think right now they're starting to look at the dollar and starting to see there's a slim chance the federal reserve is going to move. as a result, a lot of traders are bailing out of the long dollar positions. we've seen a big move lower in u.s. treasury yields. i think that's also contributing to the anxiety and markets. we had a lot of overstretched positions where people were significantly short euro, short pounds. you're seeing a lot of short covering that's exacerbating the moves here. i think, you know, overall it's
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an environment where the markets are realizing that dollar is a sell on rallies going into the march fomc rate decision rather than, you know, a harbor for kind of steady monetary policy. >> kathy, what's interesting here is as you talk about the dollar strengths and its effects versus other currencies, it pairs off against so many different ones here. where has there been the most impact in terms of adverse effect? where are we seeing the most volatility, in commodity currencies, developing markets? where can we see most of the moves happening here in terms of the biggest ones out there? >> well, emerging markets are become hit the hardest because of the volatility in the u.s. dollar. but if we're looking at the majors purely, i think we're seeing very, very big moves in the new zealand dollar it was the day's best performing currency. right behind that is the british pound as well as the australian and canadian dollar. so you're absolutely right, dominic. the commodity complex is being hit hard because commodity
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prices are moving erratically. i think it's sort of a double blow for some of the volatility in commodity currencies. but the majors, like the euro, the pound, the yen, aren't escaping the vol at all. it's just a broad based shift in the markets right now. >> kathy, thank you very much. we'll see if it holds leading into that march fed meeting. >> absolutely. and before we hand it over to "squawk box," let's highlight a few things that we're going to watch today. >> what we're watching in today's session is banks. what i'm watching. especially credit suisse. every day we wake up to another plunge in a major global bank. yesterday it was nomura in japan. today, credit suisse. down 11% in european trading. what on earth is the weakness in global bank stocks telling us? that the fed is going to be on hold forever? is there something deeper to ask about the health of the banking system? >> i'm watching linkedin earnings after the closing bell today. >> we asked you which asset class is leading the market
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moves. so far, commodities are the winner. 42% of you say it's the winner. keep voting. we'll share the poll results. that does it for us. have a good morning. looking for 24/7 digestive support? try align for a non-stop, sweet-treat-goodness hold-onto-your-tiara, kind-of-day. live 24/7 with 24/7 digestive support. try align, the undisputed #1 ge recommended probiotic.
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good morning. oil prices jumping on dollar weakness and opec rumors. asia is up, europe is up, and we're setting up for a higher open on wall street after that impressive session yesterday for the bulls. and it's the end of an era at cbs. sumner redstone stepping down as executive chairman. also changes at viacom could be next. and pharma bro martin shkreli will appear at a hearing this morning on drug pricing, but he's vowing not to answer lawmakers' questions. it's thursday, february 4th, and "squawk box" begins right now.
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live from new york, where business never sleeps, this is "squawk box." >> good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. we've been watching crude prices. they've been extending their gains this morning after yesterday's 8% rally. that's right, 8% gains yesterday. late yesterday, venezuela's oil minister said six oil producing countries support convening an emergency meeting between opec and non-opec members. that's according to a report from iran's oil ministry's news agency. crude oil getting a boost also from the weaker dollar. andrew? >> okay. a couple top stories to tell you about this hour. here's what's going on. the ecb president mario draghi speaking at an event in frankfurt overnight. among the headlines, draghi says there's no reason for central banks to resign their mandates simply because everyons


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