Transcripts For CNBC Worldwide Exchange 20240713

Exchange. Im Contessa Brewer in for Brian Sullivan the pentagon confirming overnight that general Qassim Soleimani has been killed. The leader of the elite revolutionary guard in a targeted attack at Baghdad Airport. The attack came at the direction of President Trump the major averages are set to open in the red on this news lets take a look at the futures down across the board. The s p 500 indicated to open down 35 points the dow indicated to open down 273 and the nasdaq off by 114. Lets show you this quick Market Reaction we were watching last night off a positive close yesterday just after 8 00, the news came in about that killing of the leader of the Iranian Revolutionary guard. The plummet now again. Dow futures off by almost 1 across the board, we were seeing a swift reaction with the Energy Markets as well. Right now, wti is up crude is up 3. 5 as well look at the chart. What happened as the news came in wti spiked as the news came in just before or just after 8 00 p. M. We saw this up almost 4 , 2 a barrel for wti a Quick Reaction there the risk of trade is in full swing as investors retreat after the stocks hitting the highest level off a percent in a third in currencies we see a big rush for the yen. The safe haven trade again, the timing on this is clear as investors rushed to the yen. We see the dollar off a half of a percent at 1. 08 year Team Coverage around the world, we are following the latest out of washington and from london, we are joined by director of research and chief oil analyst thank you for being with us. First, aemon, lets get to you reporter this Deadly Strike reportedly came just outside of the Baghdad Airport last night just around that 8 00 p. M. Time frame. The head of the quds force Qassim Soleimani was killed in this strike. Surprisingly he was in baghdad physically at the time of the strike and perhaps not surprisingly, the United States had intelligence clearly on where he was and was able to target him who is Qasem Soleimani and his role he led the special forces group, the subdivision of the Iranian Revolutionary guard. It has a terrorism december sig. He approved attacks on u. S. Embassy in baghdad in addition to a long history in the region including in syria and throughout the middle east soleimani was involved in planning attacks against u. S. Service members throughout the course of the iraq war and was a very dangerous foe for americans fighting in baghdad and surrounding region here is a statement as you mentioned from the Defense Department saying at the direction of the president , the u. S. Military has taken decisive defensive action to protect the u. S. By killing soleimani the head of the quds force now, the question is, what will the iranian response to this be . And what has President Trump planned in response to that . The question is whether this is significant escalation defense secretary has said the game has changed there would be preemptive attacks if the u. S. Learned they are planning attacks against america or american targets around the world are you learning how the u. S. Is hardening its facilities preparing for an escalation of tension . We dont know specifically but the state department has sent americans on alert. Nbc news has spoken to officials in new york and los angeles. No specific information here on the hardening of targets inside the United States. Clearly, American Forces worldwide are in a heightened state today in the wake of this attack we dont know at this point. We have no statement yet from President Trump other than he tweeted out the image of the american flag. Well wait and see what the white house said about why it took this action and what it expects to happen next he was at an event and said he doesnt want a war with iran. He wants peace is he likely to get support of congress throughout the day today . Weve seen divided action weve seen statements for and against this action by the president from various members of congress. Youll see his party certainly line up firmly behind the president. There is some skepticism from democratic members of congress who have issued statements saying that they are worried they would release a statement that the president didnt think this all the way through and that this will lead to a wider hot war rather than just the proxy war unfold in iran and iraq and especially syria. The question here is politically for the president , will he be able to garner the majorityof american support and how does all of that play out in a time it comes at the time the president has been impeach and is facing impeachment trial in the senate thank you for setting the scene on a very sobering friday. Lets get another check on Oil Prices Today wti and brent spike as much as 4 on the news of the u. S. Air strike that killed irans top general. They have retreated just a bit wti now higher ice brent crude up three and three quarters thank you for being with us today, set the scene on what we can expect to see in the oil sector i think the key over here is the markets reacted. It has been a knee jerk reaction everybody has been asking the question how does iran retaliate. Youve seen prices jump 3 , 4 you dont expect iran to retaliate. They are not wreckless there will be a huge urge to do something. They are going to plan this and they are going to take some time if you dont see anything instant anious, the market might give up the gains by the end of today or potentially even on monday for us, it is a very big deal. Weve seen when the attacks of up tick happened as well this market is extremely skpl complacent it is a very, very tight market. The general message or view is that all of the market is the world unless it sees an actual outage last. Im not sure it will sustain this rally yet once you stop to see the reaction, the real risk is in iraq and how it unfolds. Those prices will go back up again. Creating concern about the supply of certain types of crude. I would think there would be concerns not just on irans supplies but those surrounding neighbors as well if the neighbors are drawn into a conflict 100 . The sanctions have crippled the iranian exports down to 400,000 barrels a day. Those will continue through smuggling and chinese still buying some oil. Thats not going to stop the real risk is how does iran retaliate. Weve seen what it can do. Does it do similar stuff again is there another attack on saudi facilities sorry, i have this cold. Or we will see in iraq remember, iraq does export 3. 5 billion barrels from the south. That, i think, is the biggest risk for the market right now. If it gets really sectarian in iraq, that is where the risk is. It will get very messi there is a lot of oil at risk. Thank you so much go have a glass of water for us. When we come back, well have more on the global Market Reaction to the overnight u. S. Air strike that killed one of the top military commanders. It has been called International Terrorism by irans foreign minister sectors you need to watch this morning. Stocks look to take a sharp turn lower. Lower. And latepark city,c croft is telling her investors er through the airport. With ship skis, youre just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. With unrivaled pricing, real time tracking ship skis delivers, hassle free. Ship ahead and go catch those first tracks on fresh snow. Ship skis. Your skis. Delivered. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Its almost like a mywchallenge everyday to seeey. How well i can eat and still enjoy myself all day long. I wake up every morning to see how much weight ive lost and how much better i look. Myww join for free lose 10 lbs. On us. European stocks are trading lower right now after a top iranian general was killed in a u. S. Air strike in baghdad Joumanna Bercetche joins us now from london. What a difference 24 hours makes. We had a strong start to the year with all of the majors up in the green yesterday today, trading very Much Negative down 0. 8 percentage point. Ftse 100 in the uk has dipped below 7,600. Down 26 points, 0. 3 Percentage Points a bit of green that is not apparent here. We see some of the oil majors like bp leading. Some of the oil stocks there set to gain. Very strong declines today down 1. 5 with some of the big names in industrial space. Airlines trading down 200 points after being up yesterday with the index and the decline we are seeing in asia anticipated in the u. S. Futures. Cac in france is down. Some of the big names there, industrials leading some of the losses the italian index tends to be a more cyclical prospect seeing declines and telling you today people are moving outof th cyclicals and back to safe haven territory. We saw the impact of the news was especially felt in the travel and leisure sector. Yes absolutely looking at the dax, that is down lufthansa is down 7. 5 Percentage Points today even at the bottom easy jet is down that makes a lot of sense on a day when oil is up anything from 3 that any airlines or any company that uses oil as a main cost or raw material would be trading inversely and down on the news so airlines have been taking it heavy in europe and on a major sector here. All sectors have been trading in the red. Up at the top, only oil is trading in positive territory thank you for the update from europe as we head to break, take a look at other stories we are keeping an eye on this morning tess lue is cutting the starting price for the chinamade model that stock off in the premarket by 1. 5 . The turkish owner of the private jet that carlos ghosn used to escape japan has filed a criminal complaint one employee has admitted to falsifying flight records and says he acted alone. Shares of Credit Suisse are lower today after the bank announced a 1 billion buyback program. Announcer todays big number 1,331,000,000,000 thats apples markecat p after it closed yesterday. Do you have concerns about mild memory loss related to aging . Prevagen is the number one pharmacistrecommended memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. New fixodent ultra dual power provides you with an unbeatable hold and strong seal against food infiltrations. Fixodent. And forget it. Good friday morning, stock futures pointing to steep losses the dow is set to open some 270 points lower s p futures are off. Nasdaq off 115 points on news that the u. S. Has targeted the leader of the Iranian Revolutionary guard. Lets get a check on other top headlines. Frances rivera has more news for us we start with the deadly fire crisis in australia that rages on authorities have declared a state of emergency in the state of New South Wales the fire has killed at least 17 people and scorched millions of acres. Firefighters from the u. S. Have joined in the fighting Trump Administration rolls out a partal pan that falls short of the entire ban. A warning that teens will simply switch to flavored ecigs still allowed. This comes after congress raised the age to 21. Female directors break records. Up from 8 last year those are your headlines for a friday morning thank you for that still to come, the latest on the u. S. Air strike. The Market Reaction. How that attack could shift the balancof pere ow in the region more as we return. Businesses that spend more time picking the right partner will reap the rewards. At ram commercial, we consider every detail for our promaster and promaster city work vans. Because like you, we know its the Little Things that make the biggest difference. Thats how you go from surviving. To thriving. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Here, it all starts withello hi . How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. Breaking news overnight as we can see the dow futures are off by 263 points s p off by almost 35 as the u. S. Has taken out the leader in iran there foreign minister calling it International Terrorism. Oil markets are up this morning. Helima croft joins us for reaction when Worldwide Exchange returns. Or the famed peaks of whistler, youve faced the hassle of lugging your gear through the airport. With ship skis, youre just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. With unrivaled pricing, real time tracking ship skis delivers, hassle free. Ship ahead and go catch those first tracks on fresh snow. Ship skis. Your skis. Delivered. Breaking news. Global markets are in the red following a deadly u. S. Zrodron strike on top iranian official oil prices are surging as a result of mounting concerns about those tensions we go around the globe for reaction as our in depth coverage continues welcome back to Worldwide Exchange on this friday im Contessa Brewer in for Brian Sullivan the pentagon is confirming that general soleimani has been killed the major u. S. Averages are reacting set to open in the red on the news futures are pointing to losses across the board the s p 500 off a percent. The dow off by 276 points, almost a percent and the nasdaq off by a percent and a third down 116 points. Weve seen the swift reaction across Energy Markets as well. Oil prices have come off the highs, they have popped up 4 on this news now. As you can see now back up to where they were up more than 4 . Crude is up more than four and a third percent. Investors are retreating from stocks now spot gold at the highest level look what happened when that news came in we were seeing that pop up as the safe haven places come into play here. We have Team Coverage this morning from los angeles, seema joins me on set alongside the head of product direction. Hadley, lets begin with you in the middle east. Weve seen the strike and assassination of the man who lead attacks against the u. S hezbollah, a group he trained and backed and brought into saria as well. He was backing and training the forces in syria. Iran known for using proxies to attack not just americans but other frankly, the allies of america. And antiiranian folks across the region we are talking about what happens in saudi arabia and the uae and elsewhere. All of this in the bigger question for the United States and allies in the gulf region which is what will be the retaliation here we are not talking about if iran will strike but how and when they mean to do that there are a lot of options on the table because of the reach we have seen forming the last several years from tehran to damascus and beirut as well. We are tacking attacks on u. S. Military install operations, u. S. Embassy they have said to u. S. Citizens getting out of iraq whether it be taking the last flights out or moving across land to gets out. And we have Heard International Oil Companies asking American Employees to leave as well this is something they are taking seriously and could have broader ramifications. We are not just talking about the possibility of iran retaliating, we are talking about what could happen in reporting the strait of hormuz. We were talking about just how they expected iran to retaliate, if is that was something they were going to do they said the possibilities are mining the persian gulf. How they would detect and disable those mines. A headtohead war between iran and the United States not as likely as a retaliatory gesture and one wonders how difficult that could make things for President Trump. Moves to shore up this installation not just in iraq but elsewhere in the middle east no doubt about it, when we take a look at what we have seen across the map and several instances when we have seen the response on tankers and at the facilities thousands of troops moving in to protect saudi oil supplies and supplies to asia at the same time, the u. S. Administration to pull troops outside of afghanistan and move away from foreign wars this was a president as you know was elected on the basis in many wa ways bringing america back from foreign wars we have seen the president tying in every which way possible to bring in american soldiers at risk through the gulf and talking about the satellite where they were downing the drone. He made that last minute decision to pull back and not put american troops in harms way. It seems the president doesnt want to get further engaged in the region and at the same point, he wants to continue to enforce this maximum pressure. What we have seen here is maximum pressure at work thank you for following the situation in the middle east lets turn to seema now. It is great to see you today lets talk about the Ripple Effect this is having on global markets. Not only something traders are trying to quantify the concern is the air strike and killing of a highly respected military general Supreme Leader khamenei already saying harsh retaliation is planned. The outlook for oil prices in the short term saying it all depends on what iran does in the strait of hormuz any disruption could have an out sized impact on turkey, india and china. Also importing oil from iran traders say in general, the geopolitical risks are all trading down today also worth noting the japanese yen seen as a safe haven as investors try to understand the impact of this attack and relations and the Broader Energy market it is worth noting that they are widely regards as those are accused of multiple attacks. Touted as a win by the u. S. And certainly raises the risk of a response from iran we wait to see what that is. Just at a time when we were anticipating a ratcheting down we know travel and leisure, those companies have been hit hard what are you anticipating to see in certain sectors overseas as we are digesting this news it does come down to the Energy Complex Big Companies all rely on the flow of oil through the straits of hormuz. What they do, the scale and the impact across the middle east will be front and center stick around, lets bring in dave maza. Talking about the fear of missing out for 2020 and this settling of tensions overseas, does this attack do anything to change your thesis for the year . It does need to change our focus. The move in oil price is not really driven by the impact. Often times we have seen these strikes are actually short term. It pops and then it falls off. It is interesting and Oil Prices Move higher in december. Energy prices did quite well in december for Different Reasons tensions were coming off, fear was coming off now it is back in. You seem to be making this a shortterm concern weve seen others say the game has changed. Youve had the foreign minister of iran call this International Terrorism. Why arent you more concerned about the longterm impact here . I will agree, this is a major escalation one needs to think about something ee kwal to taking out the Vice President of the United States this has a major impact. Until we understand what those impacts will be, we think the longer term picture will be driven by Global Economic developments that we will likely be seen in 2020. Investors may want to take advantage of the shortterm pops in energy prices, we dont expect the longer term we dont expect to see the change, the positive equity markets in 2020. Curious what we could potentially have in this attack. The trade negotiations, china despite push back continues to import oil do you think this could be a stumbling block as we await the phase one deal to be signed on the 15th of january. Still dont have it signed. I dont expect it to be a major impact as we have seen with the china trade negotiations along the way. There has been a lot of hiccups. This is one we have seen from the impact to me, the potential for black swans in 2020 are really things like this. No one was preparing for most of the risks were sort of those no knowns. We are entering into the unknown known territories where we can see equity markets and confidence come out of the markets in a material way. However, we dont think that the escalation will lead to significant military attacks it will belongstanding things that will be difficult to qualify. As investors begin to interpret what this means and i understand what other impacts will be while markets in 2020 are posed to move higher. We have now seen dow futures cross that 300 threshold we are looking for broad selloff when the markets open. Are there particular sectors beyond oil you think will be affected are you looking at Defense Companies and the safe haven plays we already know like gold and yen are popping on this. Your standard safe havens like gold and yen are going to do well. In an area we expect to see strong gains energy was an area in december that did quite well. Many people were not expecting that although it is a cyclical sector, it has been out of favor for 10 years we have seen others talking about the trade of energy. Maybe come a little more than expected when stocks had been so energy has been so undervalued for so long, an opportunity like this could be catalyst areas that have been overvalued like tech that we still like for 2020 that is an area where people would take profits and move in an area like the short term. Thank you for that this morning. Coming up, more on the air strike targeting Top Commanders. Breaking down his new report on how the balancing act has gotten tougher following the strike we go to break and here is another look at futures following the losses s p off more than a percent. S p expected to open down a percent and a third. Worldwide exchange is back in a moment the first friday of 2020 we are seeing the premarket underpressure. S p 500 estimated to open down more than 40 points. The dow off by more than 300 points the nasdaq down now 130 points we have breaking news overnight that is sparking what is anticipated to be a broad selloff. The pentagon confirming the iran Top Commander soleimani has been killed in an air strike in baghdad. Joining us now on the phone. Good to talk to you this morning. Tell me about the Immediate Reaction and how this news is likely to play out across various countries. This was a shock. A surprise it wasnt anything anybody expected to happen in iran already, we are seeing massive demonstrates the government is vowing revenge. Everybody is asking what kind of revenge. How far will they go to avenge the man who really was the architect for their case you have a piece this morning looking at the balancing act in the middle east. Can you explain the challenges you see . You can look at the countries in the middle east, specifically iraq and the efforts needed since 2001 this is a country that managed until now to manage a friendly relationship with iran with an ee call ee equal relationship wh the u. S. That is now over the question is will u. S. And iran be able to coexist Going Forward and to what extent the military presence will be Going Forward. How problematic will it be that the syrian kurds found out that the support they expected from the United States could easily change . Does that create problems and challenges now trying to deal with an iranian challenge . President trump has said he would like to diminish commitments in the middle east and the endless wars he has repeatedly pushed to pulling out troops from syria. To their own fate. Anybody in the region who would try to decide now which way to position themselves has been a confrontation do are have this in mind. Iran will always be in region and the u. S. May not be. That is a powerful consideration. How do you think that will play with iraq and lebanon which had walked a tight rope wire between the United States and iran in iraq, which is a majority shia country, it is emense iran is next door and controls the power. It will be very hard to publish the void. It will be very hard for them from now on. Thank you for the reporting we appreciate you joining us this morning the global fall out over the killing of irans top general by the United States. Trump administration faces both condemnation and praise for this move well break down oils swift uptick looking at the gains right now more than 4 this morning for i and brent. Worldwide exchange back in a moment no two patients are the same. Predicting the next step for them can be challenging. Today were using the ibm cloud to run new analytics tools that help us better predict and plan a patients recovery. Ultimately, its helping thousands of patients return home. And who doesnt love going home. Here, it all starts withello hi . How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. The dollar is falling against the yen. Oil is up against the news the u. S. Has killed a Top Commander in iran. Stock futures are sinking on reports of the killing right now, you can see the s p 500 implied open down 43 points the dow futures off almost 350 and nasdaq futures down 140 points lets bring in nbc news correspondent joining us from london reporter this obviously happened late last night, the latest reaction we have so far is the appointment of a replacement. The general that will be appointed as the new head of the quds force, which is the tip of the sphere soleimani led before his replacement was more or less the deputy to soleimani, which makes sense. What he has been doing his entire career as Qassim Soleimani. Cultivating activity into the middle east. They are going to be using all of these groups from lebanon, saudi arabia and lebanon to strike back against the allies he will be in a very good position to do that. Weve been hearing a ton of reaction from the iranian government we have seen an outlet of emotion from iranian media and a spokesman from the iranian Republican Guard was weeping as he spoke about Qassim Soleimani. We have heard from hezbollah they have said this is something they are taking into consideration. We could see israel become involved and other countries throughout the entire middle east what about our nato allies . Weve heard from the United Kingdom and others they dont want to condemn the u. S. Action. Soleimani wasnt a friend of anyone in the west his death will be seen by some as a major victory everybody in europe will be very afraid of what will happen next. Especially u. S. Allies in middle east like iraq that have had the very uncomfortable position since 2003 of maintaining a relationship between iran and the u. S. Thank you for reporting there from london. Dow futures off 340 points now as the markets retreat, oil is spiking. Getting another check here you can see brent is up 4. 5 wti is following suit on news that the u. S. Air strike killed irans top general extending its gains right now. We said, its up 4. 5 . Joining me now, helima croft a cnbc contributor you wrote a piece yesterday regarding this tug of war. Give me your reaction to the news it is hard to say what the response was what we are going to be looking at is probably a very, very ferocious iranian response i dont think this is in any way going to be a shortterm issue in the market or security. Wherever iran has proxy groups in the middle east and around the world raises a real risk to u. S. Corporations and citizens in those places. This is something well be dealing with through the course of 2020. The u. S. Secretary has said the game has changed. For you in the oil industry, how has that changed for you for u. S. Companies operating in iraq, they are pulling out all of their American Employees right now. Weve had over the summer, several rockets land very close to exxon oil facilities. The secondary question is will iran try do what theyve been doing since may target major middle east energy installations. Weve had half of the output taken off line in september. I dont think in of us could underestimate irans capacity to respond to what happened yesterday. I also want to point out that gasoline futures are up more than 4 as well. In recent times, there has been this delicate balance. Gasoline has remained affordable do you see this making a change . One of the things we talk about this summer was that oil has become a lagging indicator previously, five years ago, we would talk about oil being over 100 of an incident like this the story has shield us price wise we have to see where we are headed in terms of oil prices and how this would affect u. S. Motorists. How do we think that saudi arabia would react do we have enough of a supply with increased tensions into the middle east . They were very quick to bring back production. If we did get major supply disruptions along the line in september, there would be a real emfa sis on how they would react. That we have talked about reserve that can be released what planners are talking about today and thinking about in washington what are the plans if we were to get major attacks and disruptions to shipping traffic. Im sure we have insight to the plans that Oil Companies have for dealing with the escalation of tension or the potential . Is this likely to be in long term as it looks to january and 2020 absolutely. We should not look at this as a shortterm situation Qasem Soleimaniwas the head of the most powerful Security Branch in iran he was almost a mythical figure in that country. Their response, i think, is going to be something well be dealing with over the course of 2020 iran has been under sanctions. Iraq has been producing somewhere in the area of 3. 5 billion barrels of oil a day. Can you talk to me about some of the otherregional players who may get drawn into this . Iraq is certainly, weve said consistently that iraq could be the trip wire. In terms of iraqs oil industry. Second largest oil producer, they are approaching 5 Million Barrels of oil again, when we think about exposed Energy Infrastructure where u. S. Companies operate they operate in iraq i do think that is where we are looking at a direct threat to global assets. Thank you for the incredible insight and really appreciate your perspective one more look now at the dow more than 300 points thats it for us on Worldwide Exchange. Squawk box begins right now. Breaking news, the u. S. Has attacked and killed a Top Commander. Well show you reaction to oil prices and the switch in global markets. Global yeeders respondileade. No response from President Trump other than a tweet of the american flag. Full coverage of this marketmoving event starts right now. Good morning welcome to squawk box on cnbc. We are live from the marketsite on times square. Im becky quick. Along with joe and andrew is out today. On reports that the iranian leader was killed in a u. S. Drone strike the dow futures are down by about 383 points this gives up all of the gains we had yesterday plus 50 s p futures is down about 47 points and nasdaq down by about 145 points nasdaq was up 119 but it is down 145 the first day, so goods the first week