tv Worldwide Exchange CNBC April 12, 2021 5:00am-6:00am EDT
it is 5:00 a.m. at cnbc. here is the top five at 5:00 april's red hot rolls on london calling small business in england finally allowed to reopen. julianna tatelbaum is live out and about and brings you a look at the big day in the uk and jay powell speaking out about the archegos collapse for the first time on "60 minutes"
for the first time last night. and ceos pushing back on the voting laws in georgia. and history in japan hideki matsuyama is the first japanese player to take the green jacket at the masters. it is monday, april 12th this is "worldwide exchange. ♪ simply the best ♪ ♪ better than all the rest ♪ good morning good afternoon good evening welcome from wherever in the world you may be watching. i'm brian sullivan good to be back with you after a week off let's jump in. it is monday futures are in the red we have seeing dow futures down about 90 points. not a huge drop. fair value you see is in the green. not quite a toss up. leaning more negative. the overall and why you are here
is to see if the solid run of stocks can keep going in april nasdaq 100 is up nearly 6% this month. the s&p 500 is up 4% we have very good market stats coming up for you in the rbi in a bit. other classes like bond yields that has been one of the movers and shift to value we are seeing 10-year down to 1.66%. and china is down about 1% in europe, they are getting their trading day going. they are like us and mostly in the red. they are at least finally starting to get the mainland europe vaccination program up to some kind of speed and pace. we will see if that helps turn things around. germany just turned around it is slightly in the green. that is where we begin our
week across the atlantic today is the first day that small businesses in england are allowed to reopen. all part of boris johnson's road map to recovery. julianna tatelbaum is on the streets with the tatelbaum index with the mood and feel of being able to just do out to a small shop once again. julianna >> reporter: brian, it is not just small shops today is a major milestone in the emergence of the third lockdown starting today, for the first time since december, pubs and restaurants will offer outdoor dining and non-essential retail is able to reopen. for the last three and a half months, the only places we were allowed to go were pharmacies and supermarkets that changes today we still have a lot of restrictions in place with crowd control. we have a to continue wearing masks indoors in the shops and
maintaining social distancing. also starting today, we are able to take domestic holidays and stay in self catering an accommodation. international travel is forbidden. the earliest that can happen is mid-may. covid case numbers have come down significantly in the united kingdom. on saturday, reporting 2,500 new covid cases. that is down to about 1/6 of the january peak more than half of all uk adults have now been given one dose of the vaccine. as we reopen today and people get going and make their way to covent garden in central london, the people is pfeeling more comfortable in the final lockdown which is the hope brian. >> that is fantastic news. uk, by the way, the most
vaccinated large country in terms of a percent of the population israel and bahrain and uae are above it you have done an excellent job with the vaccination rollout thank goodness we know cases are going to pop you have to look at outcomes fatalities down 43%. julianna, i hate the term. i cannot stand the term herd immunity because of the political tone everybody is a closet scientist these days there is some talk that the key threshold between vaccinations and natural exposed immunity which dr. fauci started talking about a couple of days ago that combination may be getting close to being approached in the uk you know when i talk about it. what are people saying what is the media saying about this rather sensitive issue? >> reporter: definitely a sensitive issue, brian
controversial with the models and what estimates to rely on. we had an indication from one of the leading universities talk about the potential for herd immunity being imminent when you combine the vaccinations that have taken place with the fact that so many britons were infected with covid naturally last year and this year. of course, a lot depends on how effective these vaccines are and whether or not any new variants emerge i think there are a number of open questions that is part of why the uk has been particularly cautious with international travel and reopening its borders. they want to try to protect the immunity they have they are opening in a staged way. when it comes to reopening the borders, the earliest is may that is not definite >> today is a good day in the
uk aside of pharmacies and d groceries. julianna tatelbaum, good to see you out and about. that's our tatelbaum index right there in the uk. julianna, thank you very much. let's get a check of the other top headlines as well. bertha coombs has more bertha >> reporter: usually not out and about at this hour good morning, brian. companies from paypal and t.rowe price will push back on voting laws around the country. dozens of ceos met on zoom over the weekend to layout their next plan of attack on the issue with the statement expected as soon as this week and it would add to the letter signed by 72 black executives in the wake of actions by georgia
governor brian kemp. johnson & johnson is scaling back shipments of the single dose vaccine to 80% as it works through supply linked to the troubled baltimore plant they allocated 700,000 shots from j&j that is down 5 million from the week prior jay powell speaking out about the archegos stock scandal. talking to "60 minutes." powell says that does not raise the questions of the stability of the financial system or the institutions involved in the way that led to the 2008 financial crisis powell adding his team is looking into the situation >> it was a risk management breakdown. one that we're looking very carefully at to try to make sure it doesn't happen again.
>> reporter: brian, "60 minutes" on late last night because of the masters. an amazing nail biter finish so worried for matsuyama >> he pulled through as well we will get more on that in a bit and the fed chair commenting on the markets bertha, thank you. see you in a bit when we come back, we're going to party like it's 1995. some big new stats market bulls all you out there will love this. and our market stats infrastructure we dive into the democrats' plan and why the word has a broad definition we will talk about that and how much your taxes may be going up. later on, why a shortage of one key technology is starting to be seen as a full h-blown corporate crisis we're back after this.
for stocks ahead here is what ryan found at other quarters after the s&p 500 rose 5% for basically a year straight in the third quarter of 1954, the s&p 500 then jumped 35%. the fourth quarter of 1958, that would be the fifth quarter it happened, up 8.5%. you have to go to 1982 until it happened again well, that was not good. '83, markets fell 9% the fourth previous time this happened was the fourth quarter of 1994. three of the previous four times the s&p 500 gained 5% or more four quarters in a row we had an average gain of about 13% in the next quarter after that. let's find out what victoria
hernandez makes of all these numbers at 4:15 her time victoria, thank you very much for joining us live from central time we threw a lot of numbers at you. you have to wake up early to watch the show and have coffee we dumped the numbers on you the trend is very positive does history matter? >> well, normally i would say yes. histo historically, this sets us up well we hate the phrase this time is different. we know the recession and recovery we have seen has put us in a different situation we have a few tailwinds setting us up to have a positive quarter and rest of 2021 we have an an ccommodative fed right now, we have a fed that is basically saying we're just going to sit back and see where
the putt goes and we will meander our way over we have a fed that is accommodating and pent-up demand and funds to back that up from stimulus and high savings rates. if the fed is correct, we have inflation, although a temporary rise, will be low over the longer term. these are all strong tailwinds to help the market do well for the rest of 2021 we are set up pretty good here >> listen, it is too early for isn't th snark. i poked fun. the fed went out and said when the pandemic ends and we throw a through trillion dollars at the economy, things should improve i'm not sure that is breaking news there his point is well taken. if there was something more
dovish than a dove, that would be him should you feel comforted by the fact that the central banks and many others around the world have zero intention of allowing anything financially negative to occur? >> i think the market is not comfortable with it right now. it is why we have seen some of the volumeatility we have seen the market is concerned the fed will wait too long and get behind the curve when it comes to inflation they are sticking to their guns that this is temporary and it is supply chain issues causing this we had ppi last week which was higher than expected we get cpi tomorrow. a lot of data thrown at us this week the problem is what we have seen in the market has been based on the soft data and optimism we need the hard data to back it up let's see if we get it we have retail sales this week and auctions we know the seven-year auction a
month ago caused yields to move higher we are watching the auctions to see what happens i do think the fed has a good grasp at this point in time. it sets us up well for the coming quarters. >> making me feel bad, victoria, a couple of weeks on the rbi, we talked about cisco systems being red hot stock. you sold cisco and you are buying nvidia. is that because of our rbi >> not because of the rbi. we are using the pull back we sold cisco and went into nvidia we like the space. w we brought broadcomm as well i will tell you another name, brian, adobe these are not some of the sexy names like adobe in the market the secular growth and potential they have with web design and photo and video production
we think there is a lot of growth potential we like the sector we like the names going forward. >> okay. not just, hey, sullivan featured that whatever they feature, you sell? >> not that, i promise >> okay. victoria fernandez in the office at 4:20 in the morning in houston working hard always great to see you. have a great rest of the week. thank you for joining us. >> thanks, brian all right. on deck, can you hear me now microsoft reportedly ready to pay big bucks for a speech recognition and health care company. that stock is flying in the pre-market we will show you the name. plus, speaking of your morning rbi. we put the fun back in fund flows. is that a thing? you will love this stack all coming up. dow futures down 90. we're back on a monday right after this
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it makes voice software among other things it has a 23% premium to friday's closing price. that stock is up 19% right now next up, alibaba company is not expecting material impact from the record $2.8 billion anti-trust fine by chinese regulators beijing wants baba to stop requiring merchants to choose from doing business with it or other rival platforms. penalty perhaps is lighter than some expected. finally lg shares are up after the dispute for electric cars. they are threatening a $2 billion plant in georgia that sk is building to supply ford and vw with ev batteries that is why they are breathing a sigh of relief
other top headlines outside of money and business. we have frances rivera with more on that. good morning >> good morning, brian we start with unrest on the streets of minnesota once again. the national guard is mobilized as protesters are out as tear gas is being used. the neighboring police department is reporting the front door was shattered by gunfire and businesses looted. this outrage erupted after a man was shot and killed ten miles from where george floyd died a driver was pulled over for a traffic violation and officers discovered an arrest warrant the man then reentered the car as they tried to arrest him. one officer filed their gun. iran is calling a blackout at the atomic facility underground as nuclear terrorism. two officials said the explosion at the facility destroyed an internal power system.
it appears to be sabotage. it could take up to nine months to get production back online. history at augusta national. the first for the masters as hideki matsuyama tapped the final putt finishing 10 under par by winning by one stroke matsuyama is the first japanese born man to ever win a major golf tournament. last year's winner, dustin johnson, presented the first green jacket to matsuyama of his career. >> thousands of fans lining the fairway. felt normal. >> yeah. some masks some without at least the feeling is there. we may be right on track >> we'll see it felt normal for them. not for us in the northeast. frances rivera, thank you. outside. all right. on deck.
damage control in beijing after the lead scientists admits the covid vaccine may actually not work like they said it would. and more than environmentally friendly we have savia subramanian is here if you have not subscribed to our podcast, check us out on apple, spotify, stitcher and other podcast apps we're back after this break. stick around don't settle for products that give you a sort of white smile. try new crest whitening emulsions for 100% whiter teeth. its highly active peroxide droplets swipe on in seconds. better. faster. 100% whiter teeth. crestwhitesmile.com
welcome back april being showered with stock buyers and big-time new money. can a record start to the month roll on? we'll show you the cash stat and president biden meeting with leaders to keep the heat on the democrats over the $2 trillion spending package. what is in the long-time spending wish list we break it all down. and put john and ponch on the case there's a chips crisis it is crushing american supply chains and has the white house taking notice. it is monday, april 12th this is "worldwide exchange"
here on cnbc ♪ ♪ welcome. welcome back i'm brian sullivan thank you for joining us here is how your money and investments look as we are not quite, but close to halfway through the 5:00 a.m. hour dow futures are down 78. fair value is actually in the green. remember, slight difference in some cases between cash markets, et cetera. we are seeing the implied open down that is less than we were. we have to see how it shakes out. now it has been a great start to the month. all the major averages up 2.5% or more in april now, volume was low last week. we get it. that aside, it was still a very nice week technically. here's why i say that.
we open on our lows on monday and gapped higher and closed at our highs on friday. very nice technical set up the breadth of the market was very good. 75% of s&p 500 stocks rose last week and we don't talk about it a lot, but maybe we should cumulative advance decline line. how about that also hitting an all-time high on friday according to instinstant. it is not just stocks seeing big buying interest. cryptocurrency continues on its tear ethereum up 16% in the month of april. bit c b bitcoin up for april so far, the only thing down is
fear vix is now lower than the level it was before the pandemic hit look at the cboe volatility index. 17.5%. now to the latest in the global vaccine race china mulling new steps in the renewed fight against covid. bertha is back with that and other top headlines. bertha >> reporter: good morning, brian. officials in china are considering mixing covid vaccines in a bid to boost effectiveness. according to the reports, the director of the china centers for disease control and prevention says the country's roster of treatments don't have very high rates of protection. that was the quote later he said the comments were misco misconstrued a study out over the weekend
details the late stage testing confirmed the efficacy is slightly above 50% apple agrees to make a senior executive available for the anti-trust concerns over the app store. the tech giant says chief compliance officer will be available to testify at april 21st judiciary committee hearing. apple has faced criticism over the revenue sharing payments and strict inclusion rules. and "godzilla vs kong" is the king of the box office pushing in the domestic hall up to $70 million it is the top grossing film of the pandemic era bypassing "tenet" which earned more than
$58 million. interesting. normally a $58 million haul the first weekend in normal times is not very much at all >> i didn't see it who is the good guy? is kong the good guy or is godzilla who wins >> reporter: i don't know. i guess there must b be #teamgodzilla or #teamkong. >> this is where we were, b bertha this is where we are bertha coombs, see you in a bit. thank you. let's kickoff the half hour with a serious question. what is or susisn't infrastructe you may never have wondered about the definition before. the president is pushing you, american people, congress and taxpayers, on a $2 trillion
plan the bill would include a few hundred million for roads and bridges and broadband. it should have a ton of bipartisan support the plan also includes a list, some say, stretches the definition maybe a bridge too far free community college and home health care. the bill would quietly include a rollback of right-to-work laws in many states something that unions have been trying to get passed for decades. now to pay for it? the president wants to raise corporate taxes back to 28% and raise individual taxes let's talk about this with libby cantrill libby, thank you for joining us again. a lot of this stuff is stuff. with all due respect to any political party. nobody is slapping together a
1,000-page spending bill in a couple of months this has been around for a long time especially on the infrastructure side for good or bad, whatever your view is, is this the be all wish list >> good morning, brian this is phase one of the proposed infrastructure efforts. this, as you mentioned, includes things we do think of as infrastructure hard infrastructure. bridges, roads, tunnels, what have you it includes many other things as you point out. elder care work force training. tax incentives for domestic manufacturing. so, in this bill has many union priorities and democratic
priorities this is just a preview of a broader set of democratic priorities that will come in this second proposal which should be forthcoming over the next few weeks as you very much rightly point out, congress is going to actually be doing the legislating here in some ways, president biden is providing a framework of his priorities sure, they representative of broader policies, absolutely and but, a big but here, he is trying to narrowly get the majority in the house and senate our view here is this will be very likely watered down in the final bill what you see as a proposal is not necessarily likely all going to pass. >> ultimately, liblibby, does ts get passed >> we think it does get passed,
for sure we think it balances more toward the harder infrastructure than some of the other things that have been proposed you know, our view is that we see $2 trillion bill signed into law by the fall. it would include some tax increase that is not necessarily a net impulse to the economy which is between 1% and 1.5%. you need to be humble. this is all speculative here we will see how the next few months go. investors in the market should realize this will not be like the covid relief which was proposed and signed into law shortly thereafter six weeks. this will take months. fall is a likely times frame. >> the president has been in congress since literally since i
was 1-year-old 1972 he has been doing this a long time he knows how to work it. he is rightfully selling this as paid for by corporate tax increase the cnbc viewer knowsthat's no possible corporate tax increases are less than 15% of federal tax revenue. given that, libby, this is mostly going to ultimately be a deficit spending plan? in other words, paid for by debt for the majority is there some magic way that corporations and high-income individuals, 2.5 million people would fall under that $400,000 filing, $200,000 for individuals. can that actually pay for it >> i think we need to reserve judgment, honestly it is predicated how the meetings go over the next few weeks with republicans you know, president biden, as
you point out, has been in congress for a long time whole duration of my lifetime, in case you were wondering you know, i think he rightfully understandably knows including corporate tax here is a poison pill for republicans he knows it we will see if they end up being included in the ultimate bill. we will see if he wants to work with republicans if he doesn't, then corporate tax increase -- to your question quickly, what he is proposing to do is really expand the international corporate tax re regime you are right that will increase as much revenue as he is seeking to raise this is a more broad international tax scheme and real revenue associated with it.
i'm skeptical that is in the ultimate iteration >> it will be fascinating to watch this legislative fight the next couple weeks and months libby cantrill, thank you. have a great day thank you. >> pleasure, brian. it is not just that spending plan on the president's to-do list today, he will pivot attention to the global semiconductor shortage that is hampering a number of american industries. he is set to meet with executives from 20 major companies like ford, gm, intel, taiwan semi. we have kayla tausche with a look at what we can expect from that meeting kayla, good morning. >> reporter: good morning, brian. those companies will have an audience with top commerce and national security officials as they try to get the u.s. to capture a growing share of the chip market with the demand set
to explode as higher tech goods moves forward. the major hurdle in the united states is matching incentives from overseas that have driven the cost of building these so-called fabs or factories to 20% higher here in the u.s china and south korea and taiwan have a five-year tax holiday and as a result, their market share is growing while the u.s. is decreasing. boston consulting group estimates a $50 billion investment from the u.s. could reverse that drawing investment for 19 new fabs and 70,000 new jobs and getting a quarter of the manufacturing capacity over the next ten years 18 states have the chip capacity portland, oregon, dallas and
austin, texas and phoenix, arizona. samsung is searching for a location the plans are yet unannounced so far. there is a review under way that the national security council is set to prepare a report for president biden by a june 4th deadline to try to put together recommendations to address this shortage today's conversation is going to be informing that report brian, a part of the infrastructure bill you were discussing that dealing with manufacturing capacity to help shape the legislative discussions as well. brian. >> what can they do? what are the ways they might be able to mitigate this, kayla >> reporter: i think direct government funding is possibly the clearest way that is something the industry has been arguing for the better part of the last decade. there were conversations under the trump administration that took a similar shape they wanted to onshore the
manufacturing capacity the incentive hurdles were too high there really wasn't demand or vehicle to actually convince congress to spend tens of billions of dollars to incentivize these conditions and there wasn't public opinion to argue that this industry needed funding over other industries, especially during the global pandemic now there is an acute shortage and people want cars and fridges and other components that require the chips, perhaps the public sentiment is changing. >> semiconductors are pretty much in every single thing >> reporter: everything. >> kayla tausche, thank you very much chips in chips who knows? enough to ruffle your feathers. coming up, the latest on the
vaccine rollout in america and the move the drug company is making to do to help make the fight against covid stronger. as we head to break, the top stories on monday morning. take your bleeping time off. pwc is offering u.s. employees $250 for every full week of vacation they book up to $1,000 a year the plan could cost the company millions, but they don't care. they exhausted every other attempt to get people to disconnect from the office over the past year. if you are working from home, remember, you are sleeping in the office ceo pay climbing 50% last year despite the historic business challenges and massive jumps in unemployment median pay for ceos among the 300 biggest companies, reached $13.7 million up from $12.8 million the year before.
and jay powell said it is possible the u.s. gets its own digital dollar speaking on "60 minutes" last night, powell said there are many considerations in making that kind of a bold move >> you have seen many other countries like ours that are looking at it seriously. in some of the countries, the use of cash declined precipitously. americans still like to use cash it is something atilbeth wl decided based on the situation here in the united states. that calms you helps you fall a sleep faster and stay a sleep longer. great sleep comes naturally with sleep 3 only from nature's bounty and stay a sleep longer. great sleep comes naturally did you know prilosec otc can stop frequent heartburn before it begins? prilosec otc uses a unique delayed-release formula that works to turn down acid production,
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and try new retinol24 max. all right. welcome back big news in the ncontinued figh of covid and this has nothing to do with vaccines regeneron will ask the cdc if they can use the drug ace preventative treatment this request comes after a key phase three clinical trial which found the drug reduced symptomatic infections by 81%. that is great news good reminder that our treatments have gotten better over the last couple months. all this as america does break another vaccination record over
the weekend. in all, more than 4.6 million people got their jabs. a new record and more than 500,000 more than the old record set one week ago on deck, your morning rbi and the massive figure on just how much new money has come into global markets in the last couple of months trust me this one is going to get our eyes open. and programming note tune in to our new "tech check." it launches today at 11:00 a.m. eastern time with a great guest lineup we're back after this. tner to help share the load. wealth is saving a little extra. worth is knowing it's never too late to start - or too early. ♪ ♪ wealth helps you retire. worth is knowing why. ♪ ♪
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hard to believe. it comes from bank of america. you wonder why stocks rose in price the last couple months everywhere despite a still raging pandemic? because of this. in the past five months, $569 billion was put into stock markets around the world that's $117 billion more than went into global stocks over the past 12 years. you heard that right more money coming in in five months and the previous 144 months combined. 569 versus 452 remember, despite us trying to be smart and stuff, stocks go up when there are more buyers than sellers or buyers want something more than they did before. you throw this much cold cash at the asset class which shrunk in
size, what do you think will happen incredible numbers from boa. if your 401(k) or i.r.a. is up thank a safe banker. let's take on the topic and where the money is going we have the head of the u.s. equity and kwquantitative stratg for bank of america. welcome. i know that data did not come from your group, but i don't think it did that is stunning where is the money coming from >> it is staggering. central banks. liquidity pump is alive and well and primed that is the tension with the massive liquidity index with the s&p valuation up close to levels we have never seen before.
the question is what happens next we have our views that i would love to share with you i think it gets a little harder to make alpha from here and harder to gain returns from owning the index from here >> okay. right now you can throw a dart and you made a stock that went up that is where folks like you come in, savita. >> yes. >> where is the money made if it does get more difficult? >> i think it will be a very different market going forward it already has been to some extent if you look at the year, you have seen a massive bifurcation i think the trend continues. a lot of the work is pointing to the earnings recovery and focused in the smaller sectors within the s&p
you may see a deceleration with the earnings and materials and energy and industrial and some of the cap x beneficiaries might actually do a lot better going forward. the problem for the s&p 500 is they are much smaller weights in the index. it is harder for the sectors to drive the returns that we have seen over the last ten years you know, where the leadership has been more in tech and growth you know, the earnings season is a very interesting period where we will hear from companies and outlook for the next 12 to 24 months my sense is we will see a big earnings beat this quarter i think that is already priced into the market. you saw the outside inflows into stock. is this a lot better than what we are expecting or maybe worse? those are the areas we want to
focus on >> what do you need to hear? banks on coming on this week what do you need to hear, savita >> i think we need to hear inflationary pressures are not crimping margins yet so far so good we are hearing analysts tell us that labor pressure and cost pressure is starting to really creep up for a lot of companies. this is a theme we have not seen for a long time. inflation is not a worry we had the last decade. that is one thing to watch and listen for you know, i also think it is interesting to hear more companies are spending on cap x to onshore operations. what this means is they may spend less on buybacks that is a theme we have gotten used to. 2% earnings growth from buybacks may be a thing of the past where we see different claims on cash
and corporations >> yeah. it may get more challenging from here on out. savita, amazing stats. for whoever put that together, they made our rbi. show that to them later today. savita, thank you. isn't that amaziamazing? more money in global stocks in the last five months than the previous 12 years combined i'll see you on the 1:00 show today. otherwise, see you tomorrow morning here on "worldwide exchange." "squawk box" and the gang pick it up next have a great start to your week.
microsoft in advanced talks to buy nuance for $16 billion. jay powell backing the central bank ledge to keep loose monetary policies in place. and hideki matsuyama becomes the first japanese man to win a green jeacket. it is monday, april 12th, 2021 "squawk box" begins right now. >> good morning. welcome to "squawk box" here on cnbc i'm andrew ross sorkin along with kernen. becky is off today ahead of the market open, we would open down right now. 77 points. nasdaq open off 20 points fo