Of an allout trade war. The feds hone in on capitol hill amazon under fire for laying off the organizer of the walkout in new york city. He was a guest on this show yesterday morning. It is tuesday, march 31, 2020. You are watching cnbc. Good morning and welcome im dominic chu. Your mystery chart of the day, of the quarter the one dow stock set to actually end this First Quarter in positive territory in the green. Well reveal that one name to watch coming up. First, we begin with a wild three months of the markets on this final day of the trading ahead of the open. Take a look at the dow you can see here year to date down 22 on track since the First Quarter when it fell 25 down more than 18 on track for its First Quarter since 2008 when it fell 22 so the s p taking the cake as well. Crude is down more than 60 on pace for the worst month and quarterly performance ever higher today on russia news there that they will work to steady the markets. Stock futures coming looking to add to the rally in the dow. You can see here, the dow opening up and implied opening at the bell. Being looing at the treasury markets. Well go worldwide with geof and matt matt, well begin with you the asian markets where we saw the u. S. Futures picture turn around. Japan is down 0. 8 a big bounce back for manufacturing in that country. The pmi for march rising to a rating of 52, up from the record low of 35. 7 in february. Expectations have been for the number to sit around 45. To be in contraction for another month given the coronavirus shutdown many are wondering how reliable those numbers are. Seeing if those are rep indicated. The composite down almost 10 , the worst since q42018 japan down and this one off by about 20 . The worst quarter for japanese maerkt since q4, 2008. The Australia Market down over 2 we are watching corporate bailouts coming out of australia. Virgin australia, that stock rallied after confirming it is seeking a 1 billion bailout from the Australian Government it is an early wall of green. I can see that wall. That is very positive so fall. Absolutely. The wall represents the blue chips. We are hanging on to gains here. We opened in the positive territory. The markets are holding on to this near 2 gain as can you see. Those things matt talked about in asia and the positive pmi print. We have the European Central bank reminding the market that we are here to do whatever it takes to keep liquidity. The bank of italy governor saying we do have the fire power, if necessary, to provide support. We have markets hanging on to the gains. Lets flip the wall and look at the sector break down. Very interesting here. Matt mentioned energy up here on the top line youve got gains more than 4. 25 . Shell was an interesting story they came out and told the market that they saw reasonably Strong Demand not yet impacted by Coronavirus Travel and leisure clawing back. Some of what we have seen in this sector as airlines have grappled here with the virus and the shut down. Lets look at some winners and losers and show you individual companies. This is a fascinating story. Melrose. An indication that we are starting to see here as companies begin to cut their Dividend Payment they are benefitting to a certain extend because investors are saying you are protecting the balance sheet. That is a quick look at the gainers and the losers at this time in europe back to you. To the coronavirus outbreak now. The number of confirmed cases set to surpass 800,000 with nearly 200,000 of those in the United States alone. Good morning, white House Democrats preparing for a fourth round of economic stimulus amid the coronavirus outbreak days after approving the 2 trillion phase three plan officials have compiled a list from agencies totally roughly 600 billion including state aid and Financial Assistance for mortgage and travel Industries Ford and Ge Health Care are teaming up to produce 50,000 ventilators in the next 100 days to help fight that pandemic. 500 uaw Union Workers will begin fabrication and will produce 30,000 devices a month after july virgin or bit is partnering to develop new ventilator and mass produce to send to hospitals around the United States moodys is cutting the outlook on debt cutting to 6. 6 trillion. Recession risks and rising default rates. Solid gains to string together two days worth of positivity the conclusion will put a cap on what has been a miserable march for dow. The index as a whole is down 12 for the month. Thanks in part to three drops of 3,000 points or more nearly half of the dow is down 10 or more during that time span joining us now, rob. This is a miserable quarter. Is now the time people can feel a little better about things or are people still worried that another leg down could happen . Document, it may be a little early to say i think we are starting to see the light at the end of the tunnel goldman sach has said we are in a recession. If it is correct that we get the virus under control by midyear, it should just be a twoquarter session with a strong rebound in the second half of the year. Historically, equity markets go into a bear market before you even know you are in a recession but start to rally before the recession is over. That tells me, if they are correct, we could be in the next bull market right now. We may need to test those lows on the s p 500 beforarout of th. We are about 400 points above that it is a little too soon to say one thing id make is that, and ive been saying it to clients, they dont want to be selling out of equities. They want to be market weight here and well start to see some signs that we are getting the allclear sign do you just take that money and put it all in right now because you are feeling good about things do you just buy every so often most people probably arent there right now because if they were at a market weight prior to all of this, then they are going to be underweight right now. I wouldnt suggest dumping it in right now. Cost averaging makes sense if they have some cash. They anybodile on some favorite sectors. Leveraging it in makes sense lets talk about the names you do like then what types of stocks are you looking at what exactly are you looking to add to portfolios right now . Starting from the 30,000 foot view even though the fed cant do more as far as the rates go, there is a lot that they can do to provide liquidity that will perhaps bring the dollar down. That implies large cap Growth Stocks should do better because of the dollar nudging down does that within the s p 500, i would stick to more defensive sectors here utilities, telecom, health care. I would overweight and underweight some of those cyclical sectors as well thank you when we come back, why some Small Businesses are refusing federal hand outs amid the coronavirus slow down. Later on, a cnbc sitdown with the chairman of chinese tech giant huawei his take on the virus and the impact on Global Supply chains when cnbc returns right after this yes. The first word to any adventure. But when allergies and congestion strike, take allegrad. A nondrowsy antihistamine plus a powerful decongestant. So you can always say yes to putting your true colors on display. Say yes to allegrad. You should be mad your neighbor always wants to hang out. And you should be mad your smart fridge is unnecessarily complicated. Make ice. Making ice. But youre not mad because you have e trade which isnt complicated. Their tools make trading quicker and simpler so you can take on the markets with confidence. Dont get mad get e trade and start Trading Commission free today. Welcome back to the show Small Business loans will be available on friday for companies needing to access a lifeline amid the coronavirus outbreak kate has more for us one key question companies have is around handling layoffs when keeping workers on its payroll may not be realistic a Franchise Owner is seeking help to bring people back on and hoping other Small Business owners will do the same. My hope is for those businesses that are open, that people will lean in on the employment side. Thats what the bill is intended to do. That doesnt mean people will necessarily get back to 100 employment that allows for payments on expenses bringing workers back on board the Forgiveness Amount will increase saying this is a risk worth taking even if they bring staff on isnt a guarantee the right thing for my business is that it ends up being 90 versus 100 so be it because ill have a stronger business come august the u. S. Cam ber said it is still too soon to tell how many businesses it will help. The entrepreneurs we have spoken to like barr are determined to make it work kate, one of the big points that is confusing out there is this tiered or sliding scale of forgiveness. The loans will come with an Interest Rate. Take us through why employment is a big part of why these can be forgiven. Sure. It is the maximum Interest Rate of 4 with a full 10year term it depends on how much you spend and how many employees you layoff bringing those employees back on, would bring you to loan forgiveness. Secretary mnuchin said the number of Financial Institutions should go up yesterday, the chamber said any lender that wants to participate has to go to the sba and let thec them know. They are relaxing those typical terms you need to present to get one of these loans the big message here is broader access if you have to lay people off but bring them back on, your amount would go up so for Small Business and nonfor profit side of things thank you. Amazon under fire for laying off a warehouse staffer who organized a protest demanding safer working conditions now the new York Attorney general is getting involved. More after this. Announcer todays big number, 21. 76 is how much the dow hadrpes opd. On pace for the worst First Quarter ever i am totally blind. And non24 can throw my days and nights out of sync, keeping me from the things i love to do. Talk to your doctor, and call 8442142424. What you are seeing is a live shot of times square of new york city. Normally quieter this time of the morning but travel restrictions and shelter in place mandates in new york city have made it even more quiet we head out to take a look at this, lets look at what is happening overall for these markets. Over the last week, weve seen an Interesting Development here. Utility and energy with this market rally off 6 of the lows, two sectors leading the way higher if you take a look at the worst performing sectors, they are still in the green but not by much they are ones you would want to see in a recovery. Those involve Consumer Discretionary and energy and communicate kaks services. Still up 3 to 4 they are lagging perhaps not as good a positive one of the things we will watch is what is it looks like with gold prices. Seeing the move lower. Gold futures ticked higher we talked about the futures where we have seen more of the buying pressure is not in some of the sectors you would want to see but gold, utilities and real estate keep an eye on those themes. Keep an eye on one dow stock set to open higher that is microsoft. Jumping 7 alone as the company disclosed a surge in the use of the Azure Cloud Services amid the stay at home orders. Cnbc is back right after this. I. Edward jones is well aware of that. Which is why were ready to listen. And ready to help you find opportunity. So. Lets talk. Edward jones. Its time for investing to feel individual. Stocks searching for direction as the dow looks to put a close on the worst close in a decade. Working on more financial stimulus the virus hammering the airlines and leaving consumers in shock over how low ticket prices have fallen you are watching cnbc. Welcome back im dominic chu. Kicking off the second half of the hour with a wild three months for the market on this final day of the First Quarter of trading ahead of the open, look at the dow. Down more than 20 on track for the worst quarter in the last three months it fell down 25 down 22 in this quarter s p 500 a broader measure of stocks on track for its worst quarter when it fell 22 at one point. The Energy Sector overall, crude oil prices on deck for the worst month and quarterly performance on record. This morning, stock futures are pointing to some positivity here the dow would open up 155 as future points hold s p 500 up 17 points and nasdaq up as well we are seeing an uptick in yields twoyear benchmarks below. 2 basis points 10year at. 7 basis points. Matt taylor has overnight trade in asia. Karen tzo is in london and eamon javers is in washington, d. C. Where lawmakers are eyeing a fourth change matt taylor, well begin with you. Asian markets are mixed on this trading day. We are seeing a number of markets losing steam that correlated with a move lower when it came futures we are focusing on china today the market there ending with modest gains we have a big bounce back. The official pmi for march surging back with a reading of 52 up from the record low of 35. 7 we saw in february. Expectations would be for another month of contraction given that the coronavirus shut down to a number greater than 45 many relying on the greater numbers when we get the private sector out in Services Later on in the week. When it comes to the shanghai composite year to date 9. 8 is the number there the shanghai is off about a quarter percent. A worst quarter for the nikkei since the Fourth Quarter 2008. Even worse is the Australian Market up 2. 3 at one point year to date, that market down around 24 over the First Quarter. Dom, back to you thank you for that. To early trade in europe, karen is in our london news room with the latest there, karen . Good morning. A lot of end of month, end of quarter position going on. Take a look at market activity we are fading from that amount. The dax is Still Holding it is Still Holding and trading up about 2. 5 . A lot of investors are breaking on the back of the stock italy has been hard with lockdowns and that market impacted today seeing the last sessions and slightly move muted trade. They are still waiting on the sidelines for more news on the session and the economy. Taking you to the sectors and some of the suspects that have been beaten up oil and gas stocks pick up today. And in auto. Daimler ahead of mercedes making a bit of a cut in the session today. Shell has lowered oil and gas outlook for this year. Also saying it will write down 400 to 800 million because of the price adjustments. Also, hello fresh, there is a whole economy benefitting. It updated after the bell yesterday and it will see higher revenue this quarter back to you. I misspoke, i said the news room it looks like we are in your living room right now. You are indeed and my dog is sitting at my toes i have two of them myself from one living room to another. In washington, preparing for a fourth round of stimulus amid the outbreak after phasing out the 2 trillion phase three plan. Phasing out as much as 600 trillion going to eamon in what looks like his living room for more like that. Thats right. I am in the living room here at my house over at the white house, they are focusing on a little less of the economy. The president focusing on that the cure was worse than the disease of the Economic Impact of this lockdown obligation we have extended across basically the entire country the president has extended those guidelines through the end of april. He says hes less focused on the economic damage and more focused on saving lives. So bad for the economy. The iceconomy is number two on e list to saving lives i had to go from doing a great job for three years to shutting it down. Well be stronger for it we learned a lot meanwhile, getting a look at what a phase four stimulus bill will look like the house is out until the latter part of april nothing apriling immediately nancy pelosi speculating that she would like to reinstate the state and local tax reductions that were removed in the last round. That could benefit a lot of people in her district in seaann francisco. In the sense of construction workers working outdoors are spaced out and not crammed into tight quarters my sense that this will be more partisan political fighting is more intense around it. I want to ask you, there are reports that Justice Department is invest gating possible Insider Trading ahead of the lockdown can you take us to whether you know they are the center of a possible investigation we are told the fbi is making calls. Senator richard burr made a statement and said he has done nothing wrong. He said he only acted on public information. Burr is the chairman of Senate Intelligence Committee Received a classified briefing earlier in the year that focused on some of the damage spreading throughout china in terms of the coronavirus giving lawmakers an early sense of just how bad this thing was. He sold the bulk of his Stock Holdings he said he did it entirely based on public reports. In large part, he was watching cnbc and cnbcs asia coverage and decided he better sell his stock. He doesnt dispute that he sold because of the virus but he does dispute that he sold on any information that the average investor didnt have access to chinese tell come giant huawei releasing forecast. Unique insight in the Global Supply chain arjun caught up with their rotating chairman. Take us through what the concept of a rotating chairman is. Huawei has a very interesting system where every few months, it will switch between one of the three chairman saying this is a way to keep it fresh with ideas, always moving and innovating currently, a man named eric shoe we talked about revenues that came in at 133 billion the real concern was the net profit figure of 9 billion up just 5. 6 . Missing internal targets he told me the company was targeting 135 billion in revenue and put a lot of that down to the u. S. Black listing that happened in may and april when they revised these numbers upward they really hurt the company from consumer to carrier business i had a chance to catch up to talk about the results lets listen to what he had to say. Translator the 2019 results missed our target of 135 billion u. S. Dollars we were short by 12 billion this is a su sanctions. We achieved pretty good results from hard work and support from our business partners. So 12 billion short fall there. He said 10 billion of that came from the Consumer Division because its smartphones couldnt get access to google operating system android which really hurt it that is huge coming from that Consumer Division. You mentioned huawei giving us unique insight a lot of the manufacturing here making networking equipment to laptops and smartphones. The coronavirus caused a big shut down of businesses and factories here as well i had a chance to catch up with eric to talk about how the supply chain is coming back on line they feel they can meet the demand in the short term but as the coronavirus spreads, that could cause a shortterm challenge. Translator our production has fully recovered. There shouldnt be any problem meeting all the demands in the short term but if the coronavirus pandemic drags on and cannot be contained globally and some suppliers stop production, we are bound to run into difficulties over the long run. Our suppliers have daily briefs in the local situation their ability to keep production going is crucial to huawei we have taken measures to help suppliers and protect the supply chain from disruptions pretty happy as a result. 2020 will be no easier as no doubt u. S. Political pressure will ramp up back to you. Thank you for that. A quick programming note, can you get a full recap of fastmoving developments at 7 15 eastern here on cnbc coming up, amazon facing backlash to worker protests here in new york city and a look at the airlines talk. Well be talking with the points guy about how their struggle is impacting consumers positively and negatively after this. Welcome back the United States has now become the epicenter of the coronavirus with more than 162,000 cases reported so far. Air bnb has announced new steps for new pain to rental hosts. Setting aside 250 million to offset losses. Pushing con sellation plan to midmay. Ncaa has given athletes another year of elibility. Basketball didnt get in on this because the season was nearly finished the hospital built in nycs central park to open today new yorks attorney general is calling for an investigation after amazon fired a warehouse worker that organized a walk out by employees at a warehouse. Reporting that chris smalls and his colleagues bravely protested the conditions they targeted me to silence me they fired me for speaking up today. I dont want to work for a company that dont care about people im a prime example of why they dont care for the people. Ive been with the company five years and opened three major buildings, new york, new jersey and connecticut. They say smalls was fired for violating multiple warnings and refusing to remain quarantined after coming into contact with a worker who had tested positive for the virus. Spirit Airlines Cancels flights. Scrapping flights to and from new york, connecticut and new jersey through at least early may after officials warned against travel to the area because of the coronavirus the move marks the first major u. S. Carrier to cancel all flights within the region as american plans to apply for the governments coronavirus aid with hopes it will get 12 billion. It will offer partially paid leaves and early retirements to entice employees to take those options. For more on what it means, i am joined by brian kelly, founder and ceo of the points guy. Great to have you with us. Lets talk about travel. It is in lockdown in so many parts of the country are there reasons why consumers might be optimistic about what this means for future travel plans . There are a lot of good reasons, including historically dirt cheap i was checking new york to london even in business classover thanksgiving, we are seeing fares half off over 2,000 popular routes like new york to l. A. Are at alltime historic lows, sub 200 if you have a little risk and willing to layout a little cash, you can get fantastic deals for later in this year when this is all over enticing travelers to book fares have been loser funds and fee waivers, can consumers feel better about trying to take advantage because they can be refunded absolutely. It is quite a turnaround over the past couple of years, theyve added basic fares that add tons of restrictions you add 100 if you change a ticket that is no longer the case, they are desperate and allowing for free changes, even on the cheapest fares and award tickets. It varies but i would be relatively confident in booking future travel. If you want to change it for any reason, theyll let you do it without a fee. If you dont want to travel, you are not going to get your cash back unless the airline cancels outright if you have plans over the next couple of months and the airlines havent canceled it as we have seen with spirit, wait and see if the airlines canceled your flight outright, you should get a full refund. Some are trying to give future credit but you should push for a full refund. Despite massively cutting capacity, united is offering round trip air fares over labor day from now newark to orlando for 97 and from chicago to san francisco, 115 round trip thats 126 cheaper than normal according to google. In these situations, if you can feel optimistic that travel restrictions and quarantine orders are going to be lifted, is now the time to do research on booking a flight later this fall absolutely. Not only are fares low, you can use frequent flier miles we are seeing unprecedented levels new york to dubai on emirates we are seeing almost every single day first class availability there has never been a better opportunity to cash in on those miles. With rewards you can cash in for cheaper. There is a lot to be said about the travel industry right now. Brian kelly, the points guy himself. Thank you for that you can always watch or a bk stfthion the cnbc app. Wereacju aer ts. S gotten into the office. I hear you. Feels like theres no barriers between departments now. Do you think everyone appreciates it . I do. Huh. Forgot my glasses. Serivcenow. The smarter way to workflow. About being a scientist at 3m. I wanted them to know that innovation is not just about that one aha moment. Science is a process. It takes time, dedication. Its a journey. Were constantly asking ourselves, how can we do things better and better . what we make has to work. We strive to protect you. At 3m, were in pursuit of solutions that make peoples lives better. Aand were here for you ry day fespecially now,rs. At 3m, were in pursuit of solutions doing Everything Possible to keep you connected. Through the resilience of our network and people. We can keep learning, keep sharing, keep watching, and most of all, keep together. Its the job weve always done. It is the job we will always do. Welcome back lets take a look at futures now. It is green. The dow would open up 67 points. A possible twoday winning streak joining me now, cnbc contributor. Tim, lets start with an easy one. Is the low in . You cant make me answer that question this early in the morning. Look, here is what id like to respond. The response in terms of fiscal and monetary from the fed and around the world, china cut their repo and pumped more into their market has been unprecedented. That is what investors should take some heart in look at the companies that have reported some uptick in china. Listen to what nike has said and starbucks. They have seen the other side. We shouldnt get too caught up in china data at this point but the fact that the pmi and Services Data that came out was well into expansion and shows a sharp rebound from the lows should give some light into the sequences we are going to follow on this crisis it doesnt mean we know where well be on the other side of this markets have recovered dramatically in my view, the 20 weve run into probably runs into a little bit of head room here on the s p. What i would take solace in, im not so sure we would have this big double dip here in terms of the lows im not sure we found that bottom but i will say the economic response has been very encouraging. Maybe consensus here with everybody ive talked to with regard to the trader side of things could expect more down side that seems that everybody sees one thing and on the other side this is a good thing right this wall of would havy where weve had headlines. The mark he had seemed to respond like head winds and tail winds. When we have seen the response in the market and the expectation of the march 2009 revisit will be extraordinary to duplicate. I also think the sequencing as we talked about here extreme pessimism and some of theactivity in the market were truly ahead. The fact that fed has been in here buying everything youve seen a fiscal response. Now Speaker Pelosi is talking about the next round this is giving the market what it would need. Policymakers are targeting the market as much as Everything Else with what is your biggest worry . My concern is that at some point, well see the paeak labo. There will be a lot of pain in this country and we are not going to know overnight. Cnbc eangbrki coverage is back right after this commercial break. Good morning, stocks, futures pointing to a higher open as wall street eyes the end of the worse quarter since 1987 and some what of a bounce mode as washington eyes another round of relief. Oil bouncing off new 20year lows as u. S. And russia look to stabilize the market in the midst of an allout price war. Tuesday, march 31. Applicant be over until we get there. Squawk box begins right now. Good morning, everybody. Im becky quick along with joe kernen and andrew ross sorkin. Taking a look at a wild First Quarter. Down 21 and on track for the worst quarter since 1987 when it fell by 25 . Futures this hour are indicated higher the dow is up even after the gains. Yesterday, a big day across the board. A gain of 690 points s p was up and the
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