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tv   Worldwide Exchange  CNBC  July 23, 2021 5:00am-6:00am EDT

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it is 5:00 a.m. at cnbc. here is your top five at 5:00. stocks prepare to wrap up what's been a whirlwind week as the indices look to extend their winning streak to four in a row. on the forefront of investors' minds is the delta variant. the main drivers behind the country's case surge. a flurry of tech in focus this morning twitter shares takeoff on the company's fastest revenue growth in seven years. a different story for intel.
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shares under pressure as the company's ceo issues a new warning on the ongoing computer chip shortage. making a return to the stage. the head of the american ballet theater discusses the troupe resuming indoor performances in new york city for the first time in two years it's friday, july 23rd, 2021 you are watching "worldwide exchange" here on cnbc good morning happy friday i'm dominic chu in for brian sullivan today here is how your money and global markets are setting up. futures are stable the dow implied higher by 120 points s&p by 18. the nasdaq higher by 71. the major indices are extending their win streak to three. they did so yesterday with
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technology stocks and nasdaq leading that charge. all three averages, by the way, on pace to wrap up the week in the green despite monday's sharp sell off posting the fourth positive week of the last five we want to check what is happening with the bond market right now. treasury yields facing pressure thursday after jobless claims higher than expected yields are going higher. benchmark 10-year note 1.29% 2-year treasury note is o.202%. and technology companies in china and looking at the early trade in europe. higher across the board. green across the screen. gains led at this stage here equ equally between cac and france and german dax and everything
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else up .50% let's get to other top stories this morning bertha coombs is here with those. good morning, bertha >> reporter: good morning, dom the biden administration is pegging three states as being responsible for the bulk of new covid cases this week. in a brief yesterday, the white house covid response coordinator says florida, texas and missouri were responsible for 40% of the cases during that period meanwhile, in a briefing with reporters, cdc director dr. walensky warned the delta variant is the most infectious respiratory disease ever seen. and senator amy klobuchar is
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introducing the bill in the decency act which has liability over tech companies. the bill would give the department of health and human services jurisdiction over what would be considered misinformation it includes an exemption for fake information promoted through an algorithm and jpmorgan chase adding 500 more positions in a bid to expand the wealth management services that move would double the brokers working for the boutique firm it would lag behind morgan stanley which has 15,000 wealth advisers dom, people will do transfers of wealth as they get over the next five to seven years. i imagine they are trying to find people to get that best. >> it is a demographic trend
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that's very large on people's minds. bertha, thank you. back to the markets and a positive week after kicking off with the steep sell off on monday let's now bring in alex ely at macquarie asset management alex, why did investors and traders come back to buy that dip so sataggressively >> because we're in a bull market there's plenty of retail cash on the sidelines and a lot of good things when it comes to the economy. we're optimistic while the reopening is clunky, there are still plenty of good things coming. >> if there are good things coming, why has the market stalled out the last couple months it seemed like a steady march higher then hit a record high and traded sideways. what is the catalyst that is
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needed to get things going to the up or down side? >> well, i think the market took a pause for two reasons. first off, the fed has moved to not provide unlimited support. those are their words. of the bond markets as they talk about tapering to some degree. on top of that, the reopening is tough. i have been optimistic things open up right away we have supply chain issues and it is tough to start a business when you shutdown completely and now trying to get it back going again. that's difficult i think the big change is going to happen in september that's when we see extra unemployment benefits roll off as well as schools reopening that will take care of child care i think things will get going. it just takes time wh while we're hopeful and we had issue with the delta variant, we
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will get over them and come to a strong economy for the end of the year. >> we had a lot of headlines, alex, since may with regard to inflation which was characterized as run away. we have seen that cool off we have seen the 10-year note ticking higher today, but still below 1.3% for 10-year treasuries it appears a market narrative is telling you the growth story is slowing. small cap stocks under performing how do we remedy that? >> as an equity investor, when we look at the bond markets, the bond markets don't lie they are telling you growth, while there, is not going to be dramatic in the respect thate t. we have seen futures come down lumber futures are down over
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50%. we, too, think inflation is transitory there are questions in respect to the economy in general, despite the worries of inflation, there is lots of deflation things happening commerce or virtual health care or mobile financial services over the long run, we do not see a big inflation coming down the pike >> so, alex, you have to make decisions on where to allocate money and capital and whatnot. what is the trade these days what types of companies and industries do you want to go into and which do you shy away from >> well, we're growth investors. as rates come down and the economy slows or is not quite as robust as people hope, that means growth is more scarce. we think growth investment should do well on top of that, smaller companies have not done as well
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of late, but more leveraged to the expansion the same way they are leveraged to contraction as we go into the end of the year and next year, that should speak well for growth companies and smaller companies as people are willing to take on more risk as they get better visibility on the pandemic and the economy reopening. >> and just out of curiosity, what types of companies are piquing your interests right now? what types of industries are you looking at specifically? >> lots of companies one example in health care we see procedures coming back. procedures have been growing 2% to 3% for the last 40 years. every year but the pandemic. last year, they were down 10% to 15%. they should pop back you cannot put off getting your knee done or hip fixed or whatnot forever. people avoided hospitals and avoided seeing doctors we think they will come back hospital capacity is back up and
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people going back and getting those things done whether it is getting work done dentally or having a baby or whatever it may be lots of things will happen a again. >> and then speaking of the reopening, other things have to take a backseat. one of the things we saw trending over the course of the last year during the pandemic was the surge in interest and outdoor activities and sports. sporting goods companies do really well. manufacturers of sporting equipment do well. do you think we will be those people that spend more time outside even with the reopening coming into play >> that's a great point. habits, once they're formed, take a while to change our habits have changed. we are moving to a hybrid workplace. people are spending less time commuting. spending more time hiking or
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camping. as an example, we own yeti yeti is at the nexus people are using yeti and feeling like an outdoor person by using them. we see that as being an area of strength >> all right alex ely, thank you very much. have a nice weekend. >> you, too. technology shares taking off and twitter and snap get a boost from the quarterly results we dive into the numbers. more of the big money movers including what has boston beers falling flat. and keeping the bipartisan infrastructure plan from moving forward. we have a very busy hour when orwi ehae"etns"wlddexcng rur after this break sofi is a one-stop shop for your finances designed to work better together. save, spend, borrow, invest, and earn cash back rewards, all in one app. that's how you get your money right with sofi.
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welcome back to "worldwide exchange." shares of twitter and snap surging following the latest quar quarterly results. julia boorstin has the latest from the social media stars. >> reporter: that's right, dom snap and twitter reporting better than expected results and guidance starting off with snap shares soared on the report of 10 cent per share gain the company added 3 million more daily active users a total of 13 million added in
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the quarter. it guided to faster revenue growth in the third quarter. 60% in user growth of 21%. the ceo evan spiegel says it is too soon to know the potential to target ads. he said they have seen the investment and spotlight and augmented reality pay off. >> augmented reality is different than the way we interact with computing today. i don't think it is a replacement, but exciting way to experience the world that is why we are investing on smartphones augmented reality and with wearables which is something we're excited about. >> reporter: shifting over to twitter. higher guidance in the third quarter. $1.22 billion. they expect head count along with total costs and expenses to
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grow 30% in the full year with revenue out pacing expenses. twitter cfo ned siegel says they will have more price points and rolling out to more areas. they told me the business profiles will start selling things in the coming quarters. on the ability to target ads now the impact is modest, but too soon to say how it plays out over time. ned segal will be on "squawk box" will talk about the results later this morning dom. >> thank you, julia boorstin time for other big money movers this morning. intel shares are under pressure. second quarter results beat forecast revenue fell the outlook is above estimates and raising revenue guidance for
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the full year. the ceo pat gelsinger says the supply is constrained and it to take two more years to catch up with demand. gelsinger says intel could sell more chips if they could make more chips sdplchlt we think that's the case for the industry and for us we're working to build more product. first half to second half, more expense coming into the business as we bring on more of the 10 nanometer costs. we have unique things which are good news as we move into the next process we expect asp to be stable from the first half to the second half >> by the way, you can see more of the interview with ceo pat gelsinger on "tech check" at
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11:00 a.m. boston beer tumbles after they miss forecast they are cutting projections for the year citing weaker sales of hard seltzer the demand for the brand was overestimated. some stock was low or out of stock. and finally, skechers second quarter results in sales doubled beating forecast the company says as people start to return to the office, demand is increasing for its comfortable shoes. shares up 9% in the extended trade. still on deck, the nfl taking new action to tackle potential covid outbreaks. targeting unvaccinated players and their bottom lines we're back after this.
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and dow. the dow side of things, boeing, american express, dow and microsoft leading the way higher if you look at the flip side over on the 157 00 robert half international. twitter, celanese. stocks in the green. still ahead on the show, new initiative to tackle climate change and getting behind carbon capture technology keep it here eahtacafr isig bk teth brk.
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stocks looking to make it four in a row and close out what has been a whipsaw week of action a potential new road block facing the bipartisan infrastructure bill as the senate looks to make another attempt to passing the measure. we taretailers looking to gt back to school boost we he look at the names that could be big winners it is friday, july 23rd, 2021. you are watching "worldwide exchange" here on cnbc welcome back i'm dominic chu in for brian sullivan here is how your investments are looking at 5:30 a.m. futures indicating we could
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extend gains dow i mplied higher at opening bell the major indices extending to three days on the winning streak technology stocks are on pace to wrap up the week in positive territory despite the sharp sell off. posting the fourth positive week out of the last five let's get a check of the price of oil we can see some slight gains just about flat for wti crude. $71.92 a barrel. ice brent crude is just about flat $73.80 crude is set to end the week largely steady after rebounding from the sharp drop. boosted by expectation that supply will remain tight as demand recovers. it has been a tough month for oil and gas stocks with the
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spdr oil and gas down 14%. that marks the worst month since last september for more on what has been driving that wild trading week, let's bring in shawn snyder at citi shawn, i look at monday, tuesday, wednesday and thursday. it is fairly evident that people want to buy stocks on discount is it still a good idea? >> yes, i think it is still a good idea. you did see a 10% correction in the small cap stocks you saw a 10% correction in financials some areas that had been doing really quite well. i think there is still sentiment out there you can buy the dip. what is really happening this week is it is supported by earnings earnings have been coming in quite well especially in the value space and also in the growth space i think that has bolstered
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markets. it is amazing how short lived the selloffs have been choppy markets, but investments keep coming in >> shawn, the two biggest dips we saw in the last 12 months were at this same time last year going into the fall. it was roughly 9% to 10% we saw twice happen since then, maybe 5% or 6% or 4% pull backs is this the regime now is the macroeconomics back drop or earnings story good enough to say stocks on discount or only going 4% to 5% >> i think what we are seeing with the short pull backs here is related to the treasury yield. financials and trade really in line with what is happening with the yield curve. that is one of the reasons they pulled back. i think the same thing for the energy space i noticed things going on with
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opec lower yields caused c consternation. that is seeing renewed interest in the spaces. you know, growth is doing quite well as well investors are flocking back to the familiar names in case the delta variant does become a significant issue in the next few months or heading into this hall it will be choppy. there has been signs of slowing growth atlanta gdp down to 7.5% in three weeks. chinese growth, activity slowed as well. lots to digest here. >> it sounds like you are in that camp as everybody is these days the delta variant is the largest variable if that is the case and the slowdown story is one you have to hedge against, what exactly
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do you do? what is the strategy for how you position and what exactly do you look for to put on your shopping list if things pull back another 4% to 5% if not more >> sure. what we have done and what our cio recommended is you would have 10% of the portfolio in the medium risk portfolio in dividend growers dividend aristocrats those are companies that tend to do well. kind of through the choppy times as well. you camp tch most of the gains n the up side. dividend growers in the united states and overseas. uk has a dividend yield on the ftse 100 of 4.2%
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that is how we're hedging our bets related to the delta variant. >> shawn snyder, thank you >> thank you let's get to the top stories. bertha coombs is back with those. bertha >> dom, the group of senators negotiating the bipartisan infrastructure package say they are on the brink of finalizing a deal a major dispute over how much to spend on public transit is holding up that agreement. senators say democrats want 70% of the funds for highways and 20% for transit. republicans want less than 20% to go to mass transit. lawmakers necesgotiating the pln hope to push forward with the bill in the coming days. rivian is planning to build a second factory in the u.s. the electric vehicle start-up is
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early in the process of scouting out locations. the amazon-backed company has one facility in illinois where it plans to start production on its debut models this year the move comes as other car companies accelerate their shift to electric vehicles and the nfl is out with a warning to teams over the new season and covid protocols in a memo obtained by cnbc, the league has informed team executives and head coaches it does not plan to reschedule games like it did last season due to outbreaks instead, teams are forced to forfeit games and lose money if outbreaks occur due to unvaccinated players that is a hard line, dom i wonder whether that will convince some of the players on what pressure they will feel, those holding out and not getting vaccinated >> bertha, this conversation is
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early on i'm sure the players association will weigh in on this as well and everything else will happen with regard to the right or wrongness, so to speak of that call bertha, thank you. hard to believe, but it is almost time for students to go back to school for in-person learning for the first time since the pandemic began that cocould provide a boost to retailers as people stock up on clothing and supplies. for more on that story, let's bring in jan nippon. last year was not bag to school. is it fair to cam ompare this yr to 2019? >> it will be the best back to school ever. that will compare nicely to 2019 it will be a blowout to 2020
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you will see a lot of apaparel. you will see a strong back to school this year plenty of money in the system to do it. the $300 check going out to all of the kids. a lot of that will get spent on back to school we will see a rise in the numbers over 2019. that will last all the way through holiday. not just back to school. >> let's take it to the higher level here because it has been over a year since we had to deal with this thing. what does the back to school season look like with regard to the types of companies that stand to benefit the most? is it the major big box retailers like walmart or target is it more of the niche apparel companies?
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staples or office supply companies? who stands out in that trade with regard to normal times? >> we're going to see a big-time performance by walmart, target and best buy just like last year for back to school this year, we will see levis do well boot barn do well. american eagle urban outfitters people who sell apparel and stuff to kids to wear. that is a big change we didn't say that before. is that going take it away from the other guys i named no, it's not the consumer is so healthy and spending so well that last year we thought they could never spend as much on electronics as last year. they can and they can still spend it on apparel and accessories as well. it will be good for tapestry and capri. they are not kids. they are college stuff we will see a strength across the apparel businesses
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>> you have the child tax credit payments going out that's a form of government wealth transfer to other people out there. i wonder, though, this is a year where we will not see the $1,200 stimulus checks that seem to perk spending up there was a lot of data that showed that when the stimulus checks went out within the days or weeks after receiving payments, we saw consumers spending numbers jump. what happens this year if the american consumer does not have the government payments in as big of a way as they did last year >> that's a marginal negative, obviously. savings rates are all-time highs. people feel good about their prospects for a job. we're going to see them spend and they're going to keep spending because they have the capacity and they want to. they are craving to buy something. that will show up in the
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spending it is not depressed because we're seeing unemployment c compensation run out the $300 to the kids will help that is not as big as past stimulus the economy to consumers is helpful. >> jan, thank you. have a nice weekend. coming up, vacuuming carbon out of the atmosphere. diana olick lays out the strategy to combat climate change and the big named companies behind the carbon capture technology we are back in just a memont see. the company we've trusted to keep us working remotely, is the same company we'll trust to bring us back together. cisco. the bridge to possible.
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(judith) in this market, you'll find fisher investments is different than other money managers. (other money manager) different how? don't you just ride the wave? (judith) no - we actively manage client portfolios based on our forward-looking views of the market. (other money manager) but you still sell investments that generate high commissions, right? (judith) no, we don't sell commission products. we're a fiduciary, obligated to act in our client's best interest. (other money manager) so when do you make more money? only when your clients make more money? (judith) yep, we do better when our clients do better. at fisher investments we're clearly different. hey, it's good to see you. the company we've trusted to keep us working remotely, is the same company we'll trust to bring us back together.
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cisco. the bridge to possible. welcome back to "worldwide exchange." the race to reduce carbon emissions is setting up. there is a technology to get us there faster major investors are piling in. diana olick has more as part of her series on the rising risks of climate change. >> reporter: just outside zurich, switzerland, more than a dozen massive fans are fast at work cleaning the air of carbon dioxide. it is the leading edge of what could become the largest industry aimed at saving the planet >> what's behind me is a drop in the bucket this moves about 900 tons of co2 per year globally we emit 40 billion ton. >> reporter: but the bucket is
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getting bigger quickly climateworks and governments are seeking to monumentally expand what is called direct carbon capture. here's how it works. it's a box with a huge fan on one end and a filter inside that only attracts carbon dioxide the fan sucks the air through the filter once the filter is saturated, the box is closed. it is heated to 100 degrees celsius and pure carbon dioxide is released and collected. climbworks is one of a few companies doing the capture. it installed the system in 2017, by 2020, raised $100 million from the likes of audi, microsoft and stripe and is building a larger plant in iceland. >> by 2050, it has to become a trillion dollar market those are the investments that they see are the long-term >> reporter: he likens it to electric vehicles, solar panels
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and wind farms now the state of california is working on using carbon capture to reach its aggressive goal of carbon neutrality. >> we have to try to proceed there is no choice we have to sequester carbon another a high rate. >> reporter: ken alex, the director for the law center at uc berkeley. carbon capture technology has been around for a while, he notes, but was considered too expensive. >> the price has already come down dramatically and as it scales up, i think it's fought no unrealistic to think this is a viable opportunity. >> reporter: alex says the world needs about 50,000 carbon capture plants by 2050, which would cost about $10 trillion. a colossal investment, no question, beyond saving the planet the carbon capture can be used
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to make fuel, plastics and even bubbles. climbworks sells some of the co2 to coca-cola ironically oil producers like chevron are investing heavily because it can be used to release trapped oil underground. >> in order to stick within the safe levels of global warming, we have to expand this this is not a question of can we it's a question of we have to. >> it's a new industry and it's just getting its feet wet. i think the possibilities are quite substantial. >> reporter: carbon removal also offers a new opportunity for the carbon credit market right now companies can get credit for avoided emissions or lower emissions. but in a net zero, they have not only chosen to be lower, but remove carbon and now they can buy credits from companies like climateworks people like microsoft are buying into this big time
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dom. >> how wide spread is this now >> reporter: you are seeing another big project in canada. there is another project in arizona state university where they are using mechanical trees. something like this to pull the air in and capture carbon. the more money into that tech technology, the faster you will see it grow. dom. >> diana olick, thank you. the american ballet theater has announced will return to the stage in october for performances at lincoln center the series will be the first new york fall season from the company since 2019 the announcement comes after the company wrapped a series of perp form performances outdoors. joining us is the director of american ballet theater. kara medoff barnett.
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kara, how excited are you and the troupe for the in-person performances >> dom, we cannot wait to be back in the lincoln center theater. that's our home. we have enjoyed performing for audiences across the country and in parks and feeields from lincoln, nebraska, to charleston, middleburg, st. louis, minneapolis to be back home in new york city is going to be a thrill. we had a taste of it when we performed at rockefeller center this very week we know that our new york fans are eager to see abt artists take the stage again. >> take us through it. you are excited. are there protocols you are working with or anything special to make sure this fall goes off
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without a hitch? >> of course, we want to continue our commitment to keeping our artists and staff and audiences safe that was certainly what was top of mind when we planned the outdoor tour with audiences outdoors with the summer sunshine this fall, of course, we are following cdc guidelines and requiring vaccination or proof of negative test we know things rapidly evolve. if we learned anything in the past year is to respond quickly to change. we are nimble in more ways than one. dancers are nimble on the stage, but all of us behind the scenes are able to adapt to continue to create and to share this art form with the widest possible audience >> how closely, kara, are you following the developments with the delta variant? i have to believe you as the executive director of the group
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are paying very close attention to what is happening what are you thinking as you read the news stories of the spread of the delta variant? >> we are thinking what is plan a, b or c. we keep our artists working in 11 residency bubbles we created 22 works over the past year. we will continue to find ways to train and rehearse and perform we are working closely with our venues at lincoln center we work closely with our medical adviser dr. bob gelvin we are committed to finding ways to continue to pursue the mission of this company that has been bringing extraordinary art to audiences for 81 years. that will continue hopefully that will continue on the stages at the david koch
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they theater. we are looking forward to an incredible season which features some of the new works we created during this time and bringing three of the works that we're created in the residency bubbles to new york audiences to have the live on stage premieres. now they are bringing them to lincoln center >> kara, bush/efore we let you , we he ask many ceos about expectations about the businesses for the fall. i like to ask what are the expectations for traffic and overall business health as you go into the fall is it fair to compare what is going to happen this fall to 2019 or 2018 what is it like? >> i think there is so much pent-up demand for the performing arts. so much collective and
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experiences and the joy of celebrating together i actually think that we can project that we will have the largest audience that we have seen in years. i think the enthusiasm and energy and excitement we saw ra around the country we had 6,000 people, 8,000 people in the parkswatching valet under the stars. i think the audience has missed out. >> kara, thank you very much for joining us come back and keep us posted on the results of your season. >> thank you, dom. on deck, stocks looking to keep the weekly rebound rolling on greg branch talks about when the volatility will rear its head again. and if you missed "worldwide exchange" chieck us out on your
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all right. stocks will attempt to go four of five this week which is not bad at all after selling off sharply on monday. major averages knocked the three-day winning streak in the green. let's talk about this with greg branch of veritas financial. greg, it's impressive. take us through why investors are buying that particular dip we saw on monday >> i think it is a reactionary
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issue. none of the concerns we attributed to the drop have abated there are two things we're worried about. the delta variant. there is domestic concern that dwindles the pool of workers which will cause inflation pressures on wages the primary concern is more global we are starting to see it manifest itself with the companies. many a company reporting guidance despite spectacular beats over a warning line or pressure they don't know how it will effect the supply chains the countries we are sourcing from are much less farther up in the vaccine curve than we are at 50%. australia and new zealand at 11%. taiwan at .50% the question becomes are the supply chains going to be impacted more acutely and for
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longer than we thought if that is the case, it makes having the courage to guide higher or to put up ambitious numbers. probably not prudent. >> greg, it is the time period where if you are a ceo of the company, it is expected you bring up cost pressure and supply chain constraints what does that mean for the investment thesis if there is a lack of clarity out there. is this a bet and not investing if you don't know what the future is going to look like >> let's put the variant aside for a second my view two months ago is we will see spectacular second quarter and third quarter results. that is in tact i look at that consensus, consensus was forecasting earnings power 60% and 70% of pre-pandemic levels.
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consensus is still light i think it is still under estimating the true earnings power of the companies that said, if yyou are a ceo, there is little to no motivation to forecast true earnings power. particularly when you don't have the visibility into what your labor costs will be and input costs. lastly, whether or not you will be able to pass that pricing on to the consumer. >> so if that is the case, what do you buy do you just go back to the mega cap stocks that have been doing all of the heavy lifting amazon or walmart or target or everybody else who has done well during the pandemic? >> right there are lots of good stories i like you are indicating one of the tech names and hesitancy around the names not sonly on valuatio, but the results last year was a
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covid-related bump or pulled forward that would be hard to beat this year the companies are answering that with this is a short-term. this is not transitory we are in a digital advertising cycle. e-read cycle in a hardware cycle. the results are showing that for some companies, we lack tougher comparison i think they will continue to demonstrate what we see in the second quarter for some of the companies, the question becomes what, if any, cost pressures because that doesn't apply to tech. what cost pressures of the consumer spending? for that reason, the value segment is attractive. we saw it with chipotle and domino's with burrito fatigue and pizza fatigue. this is hitting the average american worker in ways that is impactful and changing behavior. >> all right
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interesting look for sure with the value trades greg branch of veritas financial. have a nice weekend. >> thank you. that does it for us on "worldwide exchange. "squawk box" pksic up your coverage next. have a great weekend every day in business brings something new. so get the flexibility of the new mobile service designed for your small business. introducing comcast business mobile. you get the fastest, most reliable network with nationwide 5g included. and you can get unlimited data for just 30 dollars per line per month
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good morning stock futures pointing to a higher open for stocks s&p up nearly 1% for the week despite the monday selloff. twitter and snapchat jump m jumping. the nfl out with harsh rules for the unvaccinated including a forfeit of games new reaction from players this morning. it's friday, july 23rd, 2021
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"squawk box" begins right now. good morning welcome to "squawk box" here on cnbc i'm becky quick along with andrew ross sorkin joe is out today it is friday we thought it was yesterday. it is today. happy friday, everybody. let's look at the u.s. equity futures this hour. they are celebrating green arrows across the board. dow futures indicated up by 143 points s&p futures indicated up by 20 nasdaq up 77 all three averages are inches from all-time highs. they closed up yesterday we are looking for gains despite the drop of 700 points from the dow on monday this week. different week at the end of the week tha


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