Transcripts For CNBC Worldwide Exchange 20180118

Good morning warm welcome to Worldwide Exchange on cnbc. Im wilfred frost. Lets check in on the Global Markets. Futures pointing slightly lower as we look at things down a couple points 0. 6 points for the dow the nasdaq down 5 points it comes off a day of big gains. Up 1. 25 for the dow yesterday the nasdaq was up over a percent as well. The s p up just less than 1 lets look at in terms of where were going next coming up is the bond market nope bond market next tenyear treasury note coming up a yield of 2. 55 this morning. 2. 6 , we have crossed over that important milestone on the tenyear treasury note amazing to see the fiveyear is around 2. 4 that level we took so long to get past on the tenyear we got data out of china Fourth Quarter gdp at 6. 8 slightly above the 6. 7 consensus. That leads the full 2017 growth rite at 6. 9 retail sales were softer japan is lower the other markets are higher european trade, down about a half percent for the week as a whole. Coming in to a mixed session were up for germany and france. The ftse 100 slightly lower. Currency boards. The dollar was higher yesterday, but only about 0. 3 . Today a bit of dollar weakness to talk about. The euro is higher, 0. 2 not doing much against the pound. Bitcoin for you, which has had a torrid couple of trading sessions, but is rallying today. Its up a couple percent above 11,000 lets talk markets with jane foley. The dollar confusing people so far this year. Theres strong Economic Data, but still in general seeing some weakness thats right. If you go back to the start of the year, even last year, the market was getting more excited about growth in the eurozone we have the flip side of the dollar story more flows going back into the eurozone is a theme of 201 the big change in that story so far this year is speculation about the ecb. Will they stop their quantitative easing after september . That may happen. But the market will be getting excited about the potential for Interest Rate hibs from the hike ecb. If the market thinks an Interest Rate hike in 2018 could happen, theres the possibility that the market could be disappointed thats why the tone of draghi at the ecb policy meeting will be important. We cant forget that he was more dovish than the market anticipated last month in december that could happen again next week in terms of just the trading ranges for where the euro is at, based on the last 12, 18 months, right at the top of that range at the moment, are we not . We certainly are. I must put my hand up and say whilst i did think the euro would recover last year, i didnt think it would go through this rapid recovery that we did see. I didnt think that we would at the start of last year that it would end the year as high as it did. That makes me cautious about calling an end to the rally in euro dollar this year. But that said, if we look at the price action alone, without looking at any of the good fundamentals with respect to growth in the eurozone, it seems the euro is still pretty bid and could go higher. My end of year forecast at 1. 24 seems quite close. It seems the euro is a favored currency we have to bear in mind that zone, the eurozone, does have a huge account surplus thats a fact which has been behind of the portfolio rebalancing thats happened since the start of last year we had some gdp data from china this morning your gauge of that and some other data weve had out of china so far this year it seems good and a consensus shift. The last year, year before, there were concerns about the high levels of debt in china and how this could trip up growth. It does seem this high level of growth, this is part of Global Growth story, it has really managed to paper over some of those concerns for now we know we still have problems with respect to debt piles, the rate or pace of credit creation in china in recent years has been swift for now it seems high levels of growth will allow people to be optimistic we have strong growth in japan, in the eurozone, in the u. S. , a very Strong Demand for a lot of products made in china that seems to be suggesting this economy can stay on decent course for now thanks for joining us this morning. Apple is betting big on america. The company handing out stock bonuses, repatriating cash and vowing to invest hundreds of billions in the u. S. Economy lets get more details on apples big plans. Joining us is john fortt good morning to you. The big question this morning on this set of announcements from apple is how much would they have done any way regardless of the tax bill and how much is driven by President Trumps legislation . Its a fair question. The important thing to remember here is that this is a commitment that apple is making over five years. So, yeah, five years down the line, if we look back and see that apple had done this much, the 3 350 billion, the 20,000 nw jobs, which would be a 24 increase in the u. S. Work force, it might not be that much of a surprise based on what theyve done over the past four, five years. But the fact theyre committing to it now at a time when the u. S. Worker is used to seeing Companies Make Investments Overseas perhaps not grow the u. S. Work force, shrink the u. S. Work force. The fact theyre putting a floor under things is significant. We saw they had a 1 billion advanced Manufacturing Fund to invest in companies building out manufacturing in the United States theyre expanding that to 5 billion now. Thats a new floor they could always go higher than that, but they say they will do at least that. That is significant. As to how much is because of tax reform, tim cook said these changes in the Corporate Tax rate are great he believes they will grow the u. S. Economy he feels differently about what happens on the individual side, but apple has all of this cash overseas and subject to this double taxation, now this opens up possibility for apple to do Different Things including this new campus they will build in the u. S. The 38 billion in payment because of the repatriation tax, whether or not that means theyre bringing lots of cash home to invest in the u. S. Or not, either way that would not be going into the irss coffers if not for this tax bill thats right. They have to pay that tax no matter what they do with the money. I would expect to them to continue to make Investments Overseas, building out retail and making acquisitions. So people should not mistake that to mean all of that money is coming back to the u. S. To be spent in the u. S but youre seeing concrete things done like this offer of restricted stock to employees, 2500 worth of stock that will be given to employees. Tim cook implying the employees are not just going to spend that and cash that stock out necessarily. It is giving them more of an opportunity to be invested in the company over the long term next up we wait for earnings, which is in a couple weeks time . Thats right. It is, of course, the holiday quarter, which is a huge quarter for them, particularly because of these questions over iphones. The iphone x starting at 1,000, and the question is not so much everybody who bought an iphone during the Holiday Season buying an iphone x, of course not but how much does that raise Gross Margins and impact apples profitability and what is how are the inventories going to look how close is apple to what analysts refer to as supply demand balance and getting enough of these out to the marketplace to satisfy demand from customers. Great stuff thank you very much for joining us in other corporate news, shares of alcoa are under pressure after the Company Reported results landon dowdy joins us with the details. Thats right. Alcoa earnings and revenues falling short of wall streets estimates. Shares are down 6 on the news they were hurt by higher costs for energy and raw materials, unfavorable movements in Exchange Rates weighed on results. Alcoa issued weaker than anticipated guidance for Global Demand growth it projects a 4. 25 to 5. 25 growth in 2018. That compares to a 5. 25 growth in 2017. Shares have surged more than 50 in the past year as prospects of china shutting outdated and illegal polluting plants boosted aluminum prices. Back over to you thank you very much some stocks to watch, verizon expects to book a 17 billion gain in its Fourth Quarter profit due to the new u. S. Tax law in an s. E. C. Filing the company says reducing the Corporate Tax rate will slash the deferred tax liabilities. Verizon says the onetime move will add more than 4 to fullyear earnings per share intel says its problems in the patches it issued to fix the spectre meltdown flaws also expands to new chips intel will send out new fixes by next week. Shari redstone will add new directors to cbss board redstone had preliminary talks with Leslie Moonves about recombining the companies. Shari and Sumner Redstone failed in a merger attempt in 2016. Still ahead on Worldwide Exchange, bitcoin balancing the digital currency, showing some signs of support after the biggest twoday drop in years. The latest action in the cryptocurrency market straight ahead. Countdown to shutdown. The big budget battle on capitol hill has a major deadline, its just one day, 18 hours, 47 minutes and some 20 seconds away from us. Well go live to washingn toto discuss when we come back. Welcome back to Worldwide Exchange. Lets get you up to speed on the market action. Were seeing red, just slight declines the nasdaq down 9. 5 points the z the s p fractionally lower we got some gains yesterday and putting tuesdays intraday selloff into perspective with solid gains yesterday. Oil prices for you, which gained about 0. 4 yesterday, but are still down half a percent for the week as a whole coming into today are flat. 64 is the price of wti. Bitcoin showing signs of stability this morning Arjun Kharpal is live in london with more on whats happening to the cryptocurrency world after a couple of days of volatility theres a bit of stability and a small balance. Some of these coins seeing a rebalance. Bitcoin and ethereum up 7 , 8 many alternative coins seeing rallies. A lot of the selloff was due to tougher talk, korea and china saying they may shut down some the slew of bad news caused a selloff, a bit of a herd m mentality. Many experts see this correction as a chance to buy, thats why youve seen a bit of a rebalance this morning many coins still off record highs and still up significantly over the year. Thats buoying people to see longterm value. One analyst yesterday said bitcoin could reach 100,000 Warren Buffett on the other end saying the cryptocurrency market will end badly where bitcoin goes next is anyones guest but investors will be looking closely if this can test the alltime highs again an analyst from where predicts 100,000 this was a saxo bank analyst at the time i spoke to him, bitcoin was very low he said i reckon bitcoin will hit 2,000 in 2017, it did and blew past that now he says he sees that going to 100,000 this year. Its not the only 100,000 call in the market weve seen theres been a few so a lot of bullishness from those who are invested we must make that clear. So, of course, like i said, very divisive some seeing it going high levels and others seeing it crashes and burning out. News from overseas, china reporting better than expected growth last quarter. Lets get to eunice yoon live in beijing with the headlines chinas economy ended the year on a positive note, 6. 8 for the quarter, rounding off the year to 6. 9 for 2017. A lot of that was driven because of the growth story were seeing overseas a lot of shipments of chinese goods heading to the u. S. And europe beyond that seeing support from Household Income way tonight pull up some of the numbers from december telling the story. Retail sales are softer, however industrial output keeping up well as well as fixed Asset Investment going forward, theres near universal consensus that the economy will slow down thats because beijing authorities have been clamping down on credit and trying to curb pollution as well as the property sector. One other big risk for 2018 is the potential for a trade war. Right now im at a cli thehinesr parts va s factory, and this is the chairman had to say. Translator we are very concerned about how trumps policy will influence our future development in america from an entrepreneurs perspective, we hoped for a more open policy that would benefit all enterprises, including american ones. If there were a more open environment American Companies would choose better suppliers and gain greater benefits. China has a bigger trade surplus with the u. S. And there are a lot of companies here and people concerned that if china continues to see these strong exports, that that could feed into the criticism out of the white house and the Trump Administration about chinas trade practices. Eunice, thank you very much for that still ahead, shutdown showdown congress has less than 43 hours to pass a spending bill before the lights go out in washington. Were live in d. C. With the latest as we head to break, here is the National Weather forecast from bill karins good thursday morning to you. Still dealing with that snowstorm. The last place its lingering is eastern north korea. Heavy snow from the outer banks to the coastal communities its just about over with and then it will be all done some of the highest snow totals are near the raleigh area. One spot had a foot of snow in north korea. So today its still very cold. This morning cold from south texas back to florida. Everyone is below freezing temperatures have dipped to 40 degrees in ft. Myers orlando, a hard freeze for you, 30 degrees 12 in charlotte. Its just as cold in south texas as it is in the northeast this morning. Its chilly back through the ohio valley. Pittsburgh at 7 degrees. The good news for everyone in the eastern half of the country, plenty of sunshine today temperatures will continue to get warmer towards the wkeeend thats your Business Travel forecast more Worldwide Exchange when we come back weve helped our investors stay confident for over 80 years. Call us or your advisor. T. Rowe price. Invest with confidence. 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Welcome back to Worldwide Exchange. Lets get you up to speed on the market action. Were lower in the premarket, down 11 points on the dow. The nasdaq down 10 points, the s p down 1. 5 yesterday the dow was up 1. 25 the nasdaq up over a percent the s p just shy of a percent. Wall street will be closely watching washington as the threat of a Government Shutdown looms. Lets bring in john harwood. We are looking at the countdown clock there. One day, 18 hours, 35 minutes left it looks like were headed again for a shortterm solution. Is that something were confident we can reach i wouldnt say high level of confidence, but my expectation is that in the absence of an agreement, which does not exist at the moment, there will be a very shortterm kick the can solution that would involve government funding for a matter of days as negotiations continue i believe given the fact that Republican Leaders dont want a shutdown, they will end up being able to avoid one. But it will be bumpy while we get there. In terms of the hold up for a longer Term Agreement involving the democrats as well, a lot still centers on the daca progra program. Yes principally it centered on whether President Trump will sign off on that program you have a growing consensus among Senate Republicans that they have got a compromise you have seven republican senators signed on with democrats. Those seven senators are across the spectrum they have come to a deal and if President Trump blesses this deal, then mitch mcconnell, i believe, will move that bill on the floor he said out loud yesterday, im waiting to see what i will do based on what President Trump indicates he will sign in the initial immigration meeting that was public last week, where they let cameras in, the president made clear he was interested in a deal on daca what happened was over time he became irritated he decided the deal he said he would embrace, he was not going to embrace it. So he went harsh on criticizing dick durbin who made public his comments in that meeting that stirred so much controversy. If and when the president gets around to embracing that deal again, that is when youll get a break through in the senate and the house, which doesnt want to be blamed for that outcome, because a lot of conservatives dont like a daca deal, will put it on the floor and it will pass at that point does that hurt trump with his base or not that significant . I doubt it will hurt trump terribly with his base his base has been steadfast with him. Its getting smaller its not his original base, but the hard core base is going to stick with trump no matter what he does. John, thank you very much for that john harwood for us in washington of course news in and around the possibility of shutdown has been a factor to hurt markets over the last couple of days, including that selloff we saw on tuesday. Still ahead on Worldwide Exchange, a round up of the top lbelines. Wel back. And keeping it in the right conditions is the best way to get that fish to your plate safely. dane chauvel sometimes the product arrives, and the cold chain has been interrupted, and we need to be able to identify where in the cold chain that occurred. tom villa we took our world class network, and we developed devices to track environmental conditions. This device allows people to understand whats happening with the location, but also if its too hot, if its too cold, if its been dropped. Its completely unique. dennis woloshuck if you have a sensor that can keep track of your product, it keeps everybody kind of honest that way. Who knew a tiny sensor could help keep the food chain safe . Wall street pointing to a flat open after the dow closed above 26,000 for the first time ever. Financials in focus, what you need to know as another round of banks report today. And the award goes to the internet a big snafu as President Trump unveils his fake news awards its thursday, january 1, 8, 20, youre watching Worldwide Exchange on cnbc. Good morning a warm welcome to Worldwide Exchange on cnbc. Im wilfred frost. Lets check in on the Global Market picture we are pointing lower, but just slightly about 7 points on the dow. The nasdaq the laggard of the three, down about 9 or 10 points it comes off the back of a day of big gains solid gantins. 1. 25 for the dow, the nasdaq and s p about a move we have moved higher in the tenyear, breaking through that 2. 6 level on the tenyear the fiveyear is around 2. 4, that shows you how big a move weve had across the curve in the last couple of weeks 2. 6 was an important level you can see the momentum as yields are rising, prices are falling for bonds. Lets go to michael bell from jpmorgan Asset Management joining me lets go to the move on yields and crossing that 2. 6 level for the tenyear is that a significant and important barrier in your eyes i think its part of a mr. Much well see higher. We think the tenyear will end in the 2. 75 to 3. 25 range and were heading up towards that as the market looks to reprice what looks to be four rate rises in 2018 the Big Development of 2018 has been that yields have been rising along the curve, not just at the short end of the curve. Weve seen not quite a steepening but an eradication of the flattening we saw last year. What does that mean for equity market valuations . I think for equity markets the key thing is base rates. So less important what happens to the tenyear, because i struggle to see an environment where the tenyear yield rising to somewhere, even if it gets to 3. 25 , i dont think that will cause problems for equity markets. The concern would be once you start to get base rates at the upper bound of the fed funds near 3 . I dont think well get there this year. That should still be an attractive opportunity for Equity Investors once you look to 2019, lets say Interest Rates in the u. S. Get to 2. 5 by the end of this year, thats a more difficult question for 2019 what was your start of the year forecast for returns on u. S. Equities . I think one reason we saw that intraday selloff was discussions about the fact that so many wall street targets for things like the s p 500 were close to being met just a couple weeks into the start of the year. Yeah. We think that u. S. Equities can still go a bit higher from here. Part of the thing is when you look at evaluations in the u. S. , we dont think the end of 2018 earnings estimate, the consensus has been revised up enough to include all the impact you will get from the tax cuts. Those numbers are slow to start moving up. We think theres further upside in that 2018 number. So the pe looks less stretched than it does when you look at it today. I think well get decent Earnings Growth. Even ex tax cuts you would see around 10 Earnings Growth that can drive the s p 500 higher from here probably not going to see the same strength of returns as last year, but you have to couch that against a back drop where if you think were in the later part of the cycle, late cycle returns tend to be extremely strong. Lets say you took the view that there was only one year left in this bull market, that may be a bit too pessimistic, you never had a final year where u. S. Equities delivered less than 15 . So we think equities can go higher from here youre certain there will be another year then . Certainly at the moment it looks like the risk of recession in 2018 is low when you look at the surveys, you got the manufacturing, new orders component at the high ef level its been since 2004, Consumer Confidence looks good, even though its come down slightly, you have the Conference Board lead indicator telling you that the u. S. Economy still looks fine so were not seeing warning signs at the moment that warn of recession in the next 12 months. If all that data changes, clearly we need to change our mind for the moment it looks like the Economic Outlook is okay for the rest of the year then hopefully that extends through to equities. Michael, thank you very much for joining me early this morning. Michael bell of jpmorgan Asset Management weekly jobless claims, december Housing Starts and Building Permits and the monthly philly fed survey, all three due at 8 30 eastern. Morgan stanley, bank of new york melon and m t bank report before the open. Lets talk a bit more about bank earnings. Well get to what to expect from the likes of Morgan Stanley but starting with a review of some of the names yesterday and late last week with Steven Chubak from Nomura Instinet good morning to you. Good morning. Lets kick off with a review of Goldman Sachs heavy trading decline yet again. Much worse than appears. Albeit on the Earnings Call i thought he was surprisingly optimistic given how bad the numbers were given the possibility for a turnaround whether structural or cyclical given the pick up if volatility. What was your take yes, thats consistent with what we heard from all the management teams theres a general view that tax reform and some second order effects, it should drive increase costs and ultimately increased activity weve seen it on the banking side already with mrsh a and ecm activity strong in the quarter, better than many investors were anticipating also better than the guidance that we got from management. Really at the early part of december so, really strong finish to the year, up quite a bit stronger than folks were expecting. On the trading side, they struck an upbeat tone it be a function of the strong start to the year, typically theyre hesitant to elude to that, but its clear in the first ten days trading activity yearonyear started off better so i think thats informing their you have view, at the same its a showme story weve seen this before where activity starts off strong, then activity through the remainder of the year abates a bit so investors are still appropriately and i think theyre exuding a healthy degree of skepticism at the moment. For the start of the year thus far things are looking quite good steven, when you joined us a few weeks ago you were bearish on Goldman Sachs you didnt rate it as a buy. Given the selloff yesterday, are you changing your view or still cautious on the name were still cautious. The reality is there are other factors that one needs to consider if your last speaker was talking about the prospect of multiple rate hikes and steepening of the yield curve. That stands to benefit bank of america quite a bit more goldman also gave guidance on the tax rate, pro forma change, is that have been highlighted or implemented. And they actually were the least beneficiary from the tax cuts that weve seen in terms of the district impact. While they should benefit on the m a side there are more direct ways to play holspolicy winners you saw that during results season in terms of how the stocks reacted in terms of Morgan Stanley which reports today at 7 00 a. M. Eastern time what key things are you looking for . I know you were positive six months ago on the name but you kind of lost the conviction in your buy rating on that name. So we still have a buy rating on it. I think in terms of our hierarchy, it ranks a bit below bank of america. That being said, they should they are a policy winner theyre actually more rate sensitive because of their Wealth Management business, which i think is underappreciated and drives more consistency to the earnings model, so that would support a higher multiple. The stock has acted well over the last six months. As it has worked t means theres maybe not as much valuation upside as there had been, but this is a stock that can trade north of 60, 15 plus upside. On the call today, this is when they do their strategic updates. It tends to be more longer term in nature, highlighting more expriss se explicit targets for businesses. People want to see a commitment to outside capital return as well as a commitment to driving improved profit bt aabilities a Wealth Management. Morgan stanley down 1. 7 in the premarket, no reason in your eyes for why that might have happened no, nothing can come to mind. Its definitely too early for anything to have been released i didnt anticipate leaks or seen anything hit yet. We look forward to the numbers coming at 7 00 a. M. Eastern time Steven Chubak, thank you very much for joining us. That move, im not sure what drove that, but as we saw, Morgan Stanley is down 1. 7 in the premarket. Theyre not scheduled to release numbers for another hour and 20 minutes. Apple generated a ton of buzz yesterday when it announced plans to create more than 20,000 new jobs, open a new campus in the u. S. And pay nearly 40 billion in taxes on its more than 2 250 billion in cash overseas but there are a few caveats. At apple creating jobs is not always the same as hiring. Apple employs 84,000 people in the u. S. But claims to be responsible for more than 2 million jobs also paying taxes on more than 2 250 billion cash overseas doe not necessarily mean apple has to bring the money back home apple must pay taxes on overseas profits no matter whether it repatriates the cash or not and much of the money is tied to longterm investments. In a conversation with jim cramer, tim cook emphasized the need for the tech giant to be leading corporate citizens and create jobs. Cook also told jim while some of these efforts were in the works, washington enabled most of the job creating plan to occur by allowing companies to return capital to all stakeholders. So that conversation happening last night between ceo tim cook and jim cramer still ahead on Worldwide Exchange, we are going to talk trump one year later and in particular how the administration has changed the ndapfoholasce r me builders. The market, pret but through good times and bad at t. Rowe price weve helped our investors stay confident for over 80 years. Call us or your advisor. T. Rowe price. Invest with confidence. Welcome back to Worldwide Exchange. Another check on that meteorologisten stanley price, its now back to flat. They report earnings in an hour and a quarter. Time for this mornings top trending stories landon has a look at whats buzzing. President trump unveiling his fake news Award Winners in a tweet last night but the website crashed almost immediately users were quick to react to the crashed site the daily show writing 404s and heart break. Another user tweeted make servers great again. And this user adding when you send out the fake news awards but its a broken link alongside this picture from the infamous oscars mixup. The president listing 11 winners. The New York Times paul krugman came in at number one for claiming on the day of President Trumps historic landslide victory that the economy would never recover. Which was a claim that is tough for him to live down since. Clearly on the announcing these awards, he would not have gotten the bang he hoped for. Fire and fury is heading to the small screen. The controversial and best selling expose of the Trump White House will be adapted as a brandnew tv series. Endeavor content has bought the film and Television Rights to the book with Michael Wolff signing on as series producer. Do we know if this will be a west wing style Political Drama or a comedy of the snl variety . We do not know. This is about all the details we have i would go for the martin sheen style. We dont know more details besides this im sure it will do well. Only out two weeks. Crazy. A form personal assistant to the Goldman Sachs copresident is facing federal charges that he stole more than 1 1. 2 million o rare wine from his boss. Prosecutors say the former assistant used a fake name to sell stolen wine from the collection to a North Carolina wine dealer. Among the stolen wine was 7 seven bottles of a rare burgundy that sells for 2,000 a pop. Im from North Carolina, im not this buyer youre not the buyer. My first takeaway is i want an invite to davids next dinner party. Clearly the wine will be fantastic. Assuming not all of it was stolen its very expensive price tag. Its embarrassing that thats the kind of money spent and if it has been spent, youre not keeping an eye on it sounds like they found the person how do you lose that much wine to be fair, were clutching at straurs sh s straws here, y not planning on drinking it straight away from the fridge. Why not someone with keys to your full house or something could steal it over a period of time a little embarrassing. Nestle is betting big on a new kind of kit kat. They have a new ruby kit kat in an effort to boost sales and win brownie points with millennials. It has a berry taste and is being rolled out in japan and south korea first. I know youre a Big Chocolate aficionado i dont know if i am, but i like simple mainstream chocolates american chocolate is not good enough for you. I think most british people would say that, but its based on childhood taste so theyre trying it in japan. Im not sure about it well see. Thank you very much. President trump is coming up on his first year in office and in that time the market the Housing Market has been gaining steam. How have the Home Builders done . Diana olick has more on that good morning reporter good morning. Confidence among the nations Home Builders jumped dramatically to the highest level since before the housing crash. At the time the president of the National Association of Home Builders, which gauges sentiment, said builders are hopeful that president elect trump will follow through on his pledge to cut burdensome regulations hurting Small Business and housing affordability. Oneyear later builders are optimistic but not because the president delivered on those pledges. Deregulation did not happen on a large scale and most regulations are at the local level any way smaller business did get a tax cut but the Housing Market is still tough and home prices are soaring. The two biggest issues, the cost of labor and mra teaterials gote under the Trump Administration his stance on immigration caused an outflow of workers and there was already a shortage trade wars, especially with canada caused the price of materials to skyrocket lumber and osb, wall board, up double digits. So why are the builders optimistic its the economy what they reelly ca really c the most is a Strong Economy the economy is really strong the Unemployment Rate is so low and that gives them confidence to buy homes builders are hopeful some deregulation will come out of the epa in the coming year, but mostly they want to see more demand for housing and theyre getting that diana, thank you very much. Oneyear on housing for President Trump. Were approaching the top of the hour the team is getting ready for squawk box. Andrew joins me from new york with a look. Were talking apple this morning. Theyre doubling down on america. Right . No i say that with a bit of skepticism right because we dont know how much of this would have happened we dont know i think its a great thing its hard to call it bad news. Well call it good news. Ed lee will spend time with us the dow closing above 26,000 we have a number of Market Participants talking about whether you should be jumping in or not tom donohoe will join us and we will talk apple with him. Are you guys friends we have Neil Ferguson on the show at 7 30 he has a new book out. Im not personal friends. But i love his sunday times column in the uk every week. I read a couple of his books Morgan Stanley will be reporting at that moment but ill try to catch it later we have tom i wemy matolla comin the music producer think mariah carey and everything there we go we look forward to that coming up still ahead, put chores pointing slightly lower on wall street slightly higher now for the dow. A mixed open is expect l back to analyze what to expect on the trading day ahead. For your heart. Your joints. Or your digestion. So why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally found in jellyfish, prevagen is now the number one selling brain Health Supplement in drug stores nationwide. Prevagen. The name to remember. Whats Critical Thinking like . A basketball costs 14. Whats team spirit worth . cheers whats it worth to talk to your mom . Whats the value of a walk in the woods . The value of capital is to create, not just wealth, but things that matter. Morgan stanley welcome back im wilfred frost. Futures are mixed at this hour all three were lower now the dow and s p are slightly higher the nasdaq is lower. Big gains yesterday. Joining me now is kathy lian from bk Asset Management kathy, given these ongoing highs were seeing in the stock market and encouraging Economic Data and prospect for more rate hikes, why has the dollar been so soft . Theres a lot of reasons why. But today in particular the clock is ticking washington has a friday deadline in order to approve that stop gap measure, and investors are nervous that wont happen. If you take a step back, its a whole host of factors from the Central Bank Unwinding some stimulus to Central Banks like china talking about the possibility of halting or slowing treasuries china was not the only country to lower purchases japan did as well. So i think were moving in an environment where investors are selling bonds. And thats putting pressure on the greenback. Theres greater opportunities abroad provided by the Risk Appetite environment were seeing across the Global Markets. They have been selling bonds the last couple of day the stateside. The tenyear pushing above 2. 6 . Is that animportant level we have crossed over . Do you think it will proliferate a more meaningful move higher . I think so. Were at the beginning of what could be a more prolonged selloff in bond prices theres a lot of factors that make investors encouraged to look abroad. 2018 is supposed to be the year of stronger u. S. And Global Growth and while the u. S. Trade has been going on for some time, investors are starting to see presh opportunities. They will start to move money elsewhere. So, yes. Bottom line is this is the beginning of more Downside Pressure in terms of what youre most bullish of in terms of currencies the year ahead, which is it. If you strip away the nafta risk, i like the Canadian Dollar the bank of canada met yesterday, they raised Interest Rates and were optimistic. I see further gains. Great stuff thanks for joining us this morning. Thats it for worldwide. Change an action packed squawk box coming up next the dow posting its fastest ever 1,000 point gain, and wall street this year alone has added 2 250 billion in market cap countdown to Shutdown Congress has 42 hours to pass a spending bill before the lights go out in Washington Apple is betting big on america building a new campus in the u. S. And paying nearly 40 billion in taxes on that cash it held overseas. Its thursday, january 18, 2018. Squawk box begins right now. Live from new york where business never sleeps, this is squawk box. Good morning welcome to squawk box here on cnbc we are live from the Nasdaq Market site in times square. Im becky quick along with joe kernen and andrew ross sorkin. Lets look at the u. S. Equity futures. The dow yesterday up by 322 points all kinds of statistics we can throw at you it wasnt just the dow it was the s p 500 also closing at record highs and the nasdaq composite. If youre looking at yesterdays jump, the dow joining the s p 500 for being on pace for the biggest monthly gain in march of 2006 nasdaq on track to post the best month