Transcripts For CNBC Squawk On The Street 20240712

And your comments a moment ago to andrew, just sort of crystallize, not just what a job shes done, but how companies are placing their bets on looking through cycles, even though were a week away from an election and in the middle of a pandemic. You have somebody the quality of lease why isa su, best ceo i country, nonpromotional, re competitive thought this was maxed out. Youre in the personal computer and data center, it is not good enough she saw what happened to intel i dont say that with any prejudice. Just that she left intel behind. She is in the data center, who is she who are her clients . Azure, google, and, of course, amazon but it is time she feels it is time to branch out into auto, time to branch out into defense into telco when you look at xilinx, what youre seeing is a mosaic where there is some overlap in data center, but the rest is an attempt to say, you know what, we need a bigger total Addressable Market we have to outgrow our markets right now. And i think it is a very forward looking theyre talking about total adjustable market, 110 billion i want to make sure i remember that i looked through the slides. Shes going to get shes got lots of room to her shareholders to do what she wants without people questioning her given the performance of the company by the way, you dont want to overlook the earnings from amd. Thats what moved the stock the stock was at 77. They are reflective of the fact she has a deep well of support from her Shareholder Base here, jim and these numbers are blowout from amd, helping the stock price, it is an all stock deal, perhaps a bit higher than some anticipated. They were waiting for earnings too to get the negotiations finished and get to the finish line, jim, for that 1. 7234 ratio and, yes, the stock looks like it may not be down very much you hit it on the right. Right the nail with the hammer 41 cents for earnings, they were looking for 35 you have revenues that are dramatically better than expected, when you have accelerated Revenue Growth for a company that is not a spring chicken, than what you would have this is 9500 stock in a few days i think this is brilliant from the point of view of very forward thinking, because she did not want to be in clearly that is you do wonder as you watch the company grow alteras has not been a great deal for them. Thats a concern, thats been a concern in the weeks leading up to this deal where we originally got a report on it but it seemed as though there was some questions i know even you sort of have been questioning some of the logic behind it. When i talked with her, i didnt want that her to do a dual deal. It is an accretive deal, accretive from day one i often find when you second guess lisa su, david, how do you say it moron, idiot i find myself when im out with this genius, this engineer, by the way, not a bean counter, not a person who never designed a chip, i discover all sorts of things, like greatness and who is only in her camp is jensen. You did say greatest ceo, i was wondering what that meant for theyre rivals and friends and cousins. Yes keep an eye on amd stock given how much stock they will be issuing for this, there may be some pressure from those who are setting it up and arbitrage level so you could see some a bit of weakness. I think it is getting a sense here given the numbers jim, they need a shareholder vote of their own, shareholders, xilinx, and they need antitrust it is going to take a while. This thing is not closing until the end of next year. I hope they dont lose focus. 4 of the combined company will be theirs. I think when you look at the pastiche of xilinx, youre talking about wired and wireless, youre talking about automotive broadcast consumer and talking about the way 5g, which she did not have exposure in, and huawei, which was a very important client for xilinx. It has been absorbed you speak about lisa su, what you speak about is why we own stocks this is a stock that she took over i remember i spent some time when the stock was 5 and i was still idolizing intel and she told me without calling me a fool because she is what i regard as being very mannerly, explained to me the world. I remember her saying, youre schooling me and she said, yes. I liked that yeah. Jim, i always like how ceos either call you a dollar sign, posing as a human, or some kind of apparition or in this case just a fool. It is nice to be talked down sometimes. She and daniel her husband are a delight. And when you get together with them, you realize youre in another orb and you do your best to try to keep up and hopefully she diverts the conversation to something about how she grew up about ten blocks from my wife, which i like, but if you talk about youre going to talk about some of the chips, like the epic chip that is so important to the data center and to her italian name, chips, you find yourself immediately over your head. And not because she attempts to do that, but thats the language she speaks because shes a genius. Talking about 300 million in synergies, not a huge number, but saying again, to your point, it will be accretive before synergies and well talk to lisa su in the time we have, jim, want to get your take day after a significant selloff overall we have seen a tone a beat of m a, a Company Using what has been an extraordinarily well performing stock price to do a deal in all stock, but overall, as we take a look at how we ended yesterday and what happened, just give me your take as we come into today. I think a lot of people feel there will be a lockdown at certain point. We had dr. Faust on midday, who i regard as the foremost viewer of the situation, up at harvard, saying, listen, were closing the wrong places, were closing schools, we should be closing bars bars and restaurants, where it is transmitted, indoors, you go indoors. Also, there is a company sap and sap was considered to be the Gold Standard when Bill Mcdermott is there it is integral to much of technology it reported a quarter that was horrible and who did it blame not itself this is one of those the fault was not in the stars fault was in sap but, no, would they bother to say it was sap no no no they said it is the environment. The environment has sped up everybody who is involved with digitization and clout and left sap behind but, no, not them and not their dysfunctional ceo situation where i had the ceo, the coceo on mad money and three weeks later, bye. Yes, the lady youre talking about who left the company soon after you talked to her. Yeah. I just spoke truth, which is the province of novels in place. But i didnt like that the way the only other person who deflected and suggested that perhaps it was the environment was robert swan from intel here is the environment. Lisa su pantsed you. Thats a great point. Intel, those numbers did concern a few shareholders of amd wondering if there was a broader slowdown in some way and then again just back to the amd numbers this morning, the answer is no. Exactly what was important is when you listen to intel, you felt that data center was slowing down, which, of course, it is accelerated. You felt maybe the pc was weak, you felt that maybe the whole complex was weak not unlike what you felt yesterday with sap when they do this, and then you get an amd, you start questioning well maybe it is intel, and sap themselves. And not the stars, not the firmament which was explained in the Conference Call and the data the idea of these two Companies Getting together makes it so that you would no longer say that amd is just limited to the personal computer in the data center i think it is an important move to be linked to automotive and to 5g and thats whats going on right now. Yeah. It is a huge story, jim. One were going to talk about with lisa su after a break dont go away. Im searching for info on options trading, and look, it feels like im just wasting time. Thats why Td Ameritrade designed a firstofitskind, personalized education center. Oh. Their awardwinning content is tailored to fit your investing goals and interests. And it learns with you, so as you become smarter, so do its recommendations. So its like my streaming service. Well except now youre binge learning. See how you can become a smarter investor with a personalized education from Td Ameritrade. Visit tdameritrade. Com learn visitits moving day. Andarn are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. It only takes about a minute. Wait, a minute . But what have you been doing for the last two hours . Delegating . Oh, good one. Move your Xfinity Services without breaking a sweat. Now thats simple, easy, awesome. Xfinity makes moving easy. Go online to transfer your services in about a minute. Get started today. S p leaders premarket led by xilinx here. Up almost 15 as they are being bought by amd for 35 billion in stock. Were going to talk to lisa su of amd after a short break when squawk on the street continues on this tuesday. Dont go away. When i was in high school, this was the theater i came to quite often. The support weve had over the last few months has been amazing. I have a soft spot for local places. Its not just a work environment. Everyone here is family. Gonna go ahead and support him, get my hair cut, leave a big tip. If we focus on our local communities, we can find a way to get through this together. Thank you. If you are ready to open your heart and your home, check us out. Get out and about and support our local community. We thought for sure that we were done. And this town said not today. Gigantic morning gigantic morning for amd the chipmaker reported better than expected quarterly results. I think thats very much an understatement but now dealing with xilinx. They do work together, but they can be competitive that will be no more than 35 billion deal and joining us now, exclusively, amd president and ceo lisa su. Always fabulous to see you hey, good morning, jim. Great to be here with you this morning. First, we got to talk about your amd reports before we go into xilinx. It is rare i see record Revenue Growth 56 , rare i see accelerated Revenue Growth for a company your size, a company that has its own destiny, multiyear destiny. How are you capable of coming up with something that no other chipmakers do it well, look, jim, first of all, we are very, very excited today. Lots of excitement we had a very strong Third Quarter. I think the results speak for themselves i think we saw a Significant Growth on the top line, we saw a beat on the bottom line. When you look across the markets, these are the most exciting markets, so strong pcs, strong gaming, strong data center, and, you know, we see that extending into the Fourth Quarter and thats why were able to raise our full year guidance for the years, now growing over 40 on year over year basis i think it is really the culmination of all of the things that we have been doing in the strategy around building great products, working deeply with the most important customers out there. And being in the right market segment. So very happy with how the company is performing and most importantly, you know, the strength of our products. This begs the question, lisa, i tell you i saw the results, my first reaction was 90 to 100 thats where the stock would be if it werent for xilinx how do we defend the xilinx deal by is it something immediately accretive, something that expands your total Addressable Market otherwise shareholders would have been bountyfully rewarded by the numbers you know im in it for the longterm. We built our foundation, our base amd business on just thinking very carefully about what is going to happen in the industry over the next five years. So thats how we decided to lean into data centers, thats the strength of the pc market, strength of the gaming market. What xilinx brings is really very additive to the amd model it is immediately accretive upon closing. It brings significant Market Expansion as well as profitability and Free Cash Flow generation but more importantly than that, we really believe that together we can define the future of High Performance computing. And, you know, im a very ambitious person it is all about what we can do to transform the industry, as well as participate in driving sort of the next phase of computing. And thats what xilinx is all about. It is a fabulous company, i would say it is one of the best companies in the industry. It is a very unique capabilities and we are so complementary. You see that when we think about the product portfolios, the Market Segments were in and culturely very aligned as well so it is a very, very good day for amd and were very excited about what we can do together. I know youre quite familiar with mr. Peng who runs xilinx when he was on mad money recently he talked about data center, but obviously industrial and im wondering how these fit in with the company that i think has made great advancement in data center and owns the pc market at this point are these markets ones that you want to be in . Do you want to be in automotive . Yes, so, absolutely when you look, our base amd Market Opportunity is about 80 billion. Great markets, big markets, they move quickly and well. When you add xilinx, what you add is, first of all, were both still very focused on the data center thats number one priority of the company. But they bring a great communications, 5g capability, they also bring, you know, automotive, thats a market we havent been in, that market needs our technology as well so just in the telecom space, you know, we think there is an additional 5 billion of cpu opportunity for us that is largely untapped and so combined well have 110 billion which is a lot of opportunity to go after, and the key is, you know, both companies are operating extremely well xilinx is the Market Leader, they have been growing market share. We have a very strong portfolio and we have been growing market share and you put two winning teams together, and you really have one of the best teams in the industry lisa, it is david sometimes you put two teams together, you end up with not as good a team. History would show that there are plenty of well intentioned ceos who want to transition their companies, but look back on a deal a large deal like the one youre undertaking here and regret it. I just wonder, given the success you had, so much success, why are you willing to take this risk there is risk here there is integration risk. There is distraction risk. And any number of others why are you willing to take it for the opportunity you see . Great question. Let me start with hopefully you guys got to know me a little bit. Im all about focus and execution. What we set out these plans for amd over the last five or six years and it was about building a leadership road map across our chosen Market Segments and so thats not going to change i am always going to be focused on execution but were also very ambition, right . Semiconductors is a place where scale matters. It is helpful, frankly to have 13,000 engineers who can work on the most important problems. And, you know what we also have is, you know, my thoughts, i actually havent been very inquisitive. We havent talked about m a a lot as a company because i have been so focused. But this is such a unique opportunity. If you look at the fit between amd and xilinx and how we see the world shaping, i think scale matters, you know, technology, understanding matters, what were bringing together is two teams who have very similar philosophies and, you know, frankly, victor is one of the best in the industry and so excited that hes going to be joining amd as a part of this transaction so were bringing an incredibly strong and talented team to add to our already talented team so on the distraction factor, the main thing i would say is we did well and well continue to execute well and this is really about what is the next five years about. And in this business, you have to take some bold moves and i feel like this is the perfect time, frankly, as our business is so strong from a base foundational standpoint to add to the next leg in our journey and really focus on leadership. And this next year, listen, you know, year from now, you may not have closed this transaction, according to your press release and late 2021. Regulatory approvals, shareholder approvals, youre confident youll stay focused during that period and i assume you have a road map you outlined or will outline in terms of getting things done as the integration moves forward . Absolutely. I think were very focused on bringing the best of both businesses and, you know, we will have to go through the customary Regulatory Approvals and so on and so forth but we feel very good about that process. Press release dated five years ago, it is about intel acquisition of altera, the acquisition, leading Edge Products and manufacturing process with the leading field, products, internet of things, data center. This sounds like your deal the intel altera deal was a failure. How do you know this one wont be well, jim, it is a very different time and it is a very different company. And very different people. So what i would say is that xilinx is the Market Leader. They have theyre the Market Leader and they have been growing in market share over the past number of years i think when you look at our vision, it is just very aligned. We believe in High Performance computing, we believe in adaptive computing, we have a very synergistic Technology Strategy it is not like any any one of us has to change how we think about technology we think about technology the same way and furthermore, i think the fact that were bringing on victor and the Leadership Team also adds to all of that so we thought about this very, very carefully i am very much on meeting and skeeti i exceeding commitments here i think this is great for our shareholders, great for our employees, it is great for our customers. And we just have to keep executing like we have been. Thats a terrific list. Ill Say Something antithetical to your nature, youre a heroine to a lot of people in the world. Youve done a remarkable job how were you able to take a company with a terrible balance sheet, a low single digit stock and turn it into the powerhouse of your industry youre too kind, jim. All i can tell you is we love what were doing it is so exciting to be in this business right now to see the success that we had with our products. And, you know, our teams are executing really, really well and i have to be thankful for the teams we have around us. The key is, ive always told you, jim, were in the early innings of the story and im still going to tell you that the future of computing is tremendous and youre going to hear a lot in amd and amd and xilinx, you know, in the coming years. Lisa, your competitiveness, your legacy, what you have done and mean to women and men all over the world is fantastic. I want to thank you for coming on squawk on the street and telling us about your amazing deal with xilinx thank you for having me this morning. Take care. You too all right, guys great stuff. When we come back, well get to the 3q earnings rolling in this morning. Cat, lilly, pfizer, merck, harley, raytheon, a lot more futures have lost so omef their overnight highs. Were back in a minute at calvert, we know responsible investing is hard. If youre concerned about the environment and climate change, how do you find companies that are driving the right outcomes . If you care about economic equality and social justice, which firms are addressing it in their workplaces and their communities . For nearly 40 years, calvert has delivered competitive returns by investing in Companies Making a difference because we see value in doing good. Talk to your Financial Advisor about investing responsibly with calvert. Jim, a lot of blowout numbers, durables good at 8 30 eastern today. Earnings season, the highest beat ratio on the top and bottom line so far in about 12 years. Well, what does that tell you . It tells you that if youre a senate republican, perhaps you feel that these are the numbers for the vshaped any and not the 14 Million People about to be laid off when we realize that you cant have a bar or a restaurant without possible exposure to covid. But there are Companies Like the Sherwin Williams of the world, the housing, the housing remake is in a different category it impacts so Many Companies and that is by far the strongest area so far that ive seen yeah. Jim, as we say there is the opening bell here, a little more even split of advancers and decliner than we saw this time yesterday, jim Sherwin Williams good example, you point out revenue ahead, a beat, hog, third best net income since 2015 and i know you love polaris as they guide above, the consumer does have some Discretionary Income to spend on their home and their toys even as some of it came in the form of stimulus. When you take a harleydavidson, it takes many things to turn around the company, fabulous new leadership, complete blowout no promotions, no promotional activity also, it takes a pandemic because what could be more fun than riding around on a harley in a time where if youre in a building, youre fearful this is a way of travel. Like brunswick, another stock i like, which is redefining america as a place that wants to be outdoored in safety harleydavidson and polaris have both of those. Jim, i mean, there is an avalanche of earnings this morning and also transactions whether it be aig, potentially splitting the company or dte which ill get to in a moment. I want to hit as we look at the market here, see how we open after yesterdays significant downtrend over 2 . You want to talk about exact sizes, dont you i dont you want to talk about exact size 13 and buying a liquid biopsy company. Talk about it it is a private company, but talk about it. A lot of people feel the holy grail is to get blood and then able to detect cancer. We dont know,000 how to detect cancer well now. This gets them beyond Colorectal Cancer if you can do this, can you imagine how many people you would be able to diagnose early for cancers that otherwise are very difficult to get in the late game. That would be a huge undertaking. It is 1. 7 billion, could be as much as over 2 billion and when certain milestones are met in terms of what theyre paying for the company. Stock is up 13. It no longer is a company where you have to do an unpleasant task to be able to find out whether you have Colorectal Cancer which is great. Yeah. What was the deal you were going to mention so many different things. By the way, that was thrive earlier detection is the name of the company were talking about in terms of exact sciences acquiring it to what jim was explaining i want to stay in healthcare and talk merck talk covid i want your take on the merck numbers. Stock not doing much of anything i wanted to reference, we had on ridge back, back in the early days of the pandemic, it is their oral antiviral, jim, that Roger Perlmutter who is retiring fairly soon, but was discussing on the Conference Call talking about in phase two studies right now, and, again, it is a fiveday, it would be a fiveday oral course that would suggestly reduce the viral load. It is likely it will be superior to remdesivir based on p preclinical studies. There has been mixed reviews on it, w. H. O. Report, not sure why you would want to reference that i think we did reference what didnt you reference taking two regeneron and going back on the campaign trail. Infused Monoclonal Antibody this is different. I just come back to it, when we talk about all the different treatments that would be out there, this is important, based on many mechanism of action, he said theyre hopeful the new therapy, which is administered orally in capsule form will reduce morbidity and mortality along with the progress and Clinical Development lets keep a close eye on it theyre in phase two, three at merck, fiveday course, oral antiviral. A pill. Correct not an infusion. No. David, we would be doing things if we could get this pill. Yes and eli lilly we wouldnt be doing things no, give me your take on lilly. We see merck not doing much this morning on the earnings themselves great deal of it, keytruda sales were incredible. Drug of all time. 3. 7 billion for the quarter. This is an anticancer drug eli lilly, there are other uses for that drug. And they had success with mobile vans going to Nursing Homes to be able to administer. But when you get such a staunch, hey, no go, from the fda, it is daunting david ricks doing a good job i do find people dont understand the power of merck. If they can get this to work i know. It is funny, just under the radar and maybe for a reason maybe there is a sense that, 2700 people right now in phase two, three, in terms of 2700 patients you know, theyre looking at, that theyre doing the trials on safety, but efficacy is the key here both hospitalized, nonhospitalized, no trouble finding Covid Patients these days that was an issue six not six, maybe this summer you may have had a harder time, 23,000 cases a day, not anymore. Not anymore my mom died very young of Kidney Cancer and i there were a lot of false hopes. A lot of people said there was this, there was that and you went through a tremendous agony because you believed ken frazier has never let anyone believe that keytruda is going to be a magic bullet his humility in the face of recognizing false hope is what i think is creating the disconnect between how effective his course might be and why we dont think of merck as being the company that is going to solve this for us. Right, i know it is interesting. Maybe we were right as the stock ticks higher so many things not earnings related but transaction related. Here is a company i dont talk about too often. Dte energy im sure jim knows it. I did not know it. 24 billion market cap this morning they announced their plans to spin off their midstream business were talking about the nonutility natural gas pipeline storage and gathering business of dte you see the stock is reacting positively and it would make it a pure play regulated electric and natural gas utility, jim this is not dissimilar from what duke did with its pipeline business, nysor with its pipeline business. And both did quite well in terms of creating value it would seem after the transaction. Theyre going to spin it off, it will be a tax free spin to shareholders dont have a lot more details at this point fairly long press release. They had a gerood earnings, jim. There are a lot of people, the man who a lot of people the father of exports from natural gas saying we could see 5 natural gas i think hes a little too bullish. I do think that the way that youre creating wealth in pipelines and utility is to follow an Elliott Management game plan. Elliott management was integral in the detroit edison. Right these are incredible stocks. I had American Electric power on last night does anyone think it is an interesting stock . Interesting is not important what matters is income a lot of our viewers love income, we spent a lot of time talking about high flyers and i happen to love twilio. Tremendous numbers together. The stock is down but it will be up in a couple of days a lot of people dont want twilio they want income dominion doing things that is income next tara. I think this is a remarkable place, overlooked by us. A lot of the companies are interested in solar. Not because of biden or trump, but because they told me last night it is the right thing to do new way to approach business. Interesting yeah. Yeah right about twilio q4, 8 to 11 cent loss. I wanted to ask you about what is going on with some of the industrial names unp not a bright spot last week. 3m, cat, weighing on things this morning. Cat, no guidance out of cat, customers delaying some purchases. If it werent for china, im not sure where the stock would be. China a bright spot according to the cfo. Caterpillar has been one of the companies that is a proxy for Worldwide Growth and for a belief that biden will come in and will end the trade war with china. Also had some but rally levered to oil union pacific, you mentioned, talk about disappointed, i suggested last night they buy kansas city southern, theyre really in the need to do something. Precision railroad has run out 3m is a quandary i think mike roman is doing a lot of good things he had a bunch of product lines that were very strong. But once again, tripped up by a belief, i think, that they dont have the growth that people want now, is mike coming up he is, in the 10 00 that will be good i think hes turning around the company. I dont think hes getting the respect he deserves at this point. This was he inherited a company that maybe wasnt as good are you doing the questioning . Im going to be conducting some of the questions, sure. Without giving away too much im not going to i think thats important to show me up and make me look stupid carl, back to you. I would never do that i want your take on ing in a second. That soeceo, the guy that let he created a lot of value. Had him on all the time, through the exchange they are separating out their life and retirement business or announcing their intent to separate you can see shares are up 4 i had not realized the stock was down 40 . One of the worst investments. Remember aig, high flyer, for 2007, 2008, they insured everything that blew in from the window. Never saw a loss like that, 100 billion in the quarter. Everyone tried to nail goldman for the reason why aig lost and not their own incompeten incompetence that was quite a time i want to hit tiffany as well ive been following it closely of course as we get closer to potential trial date in delaware where tiffany is going to say, hey, you have to buy us. They got eu approval yesterday not a surprise they got all the approvals there. The question is, is now the time, if you want to actually see if there is a way to get this thing done and get the trial or i should say get your problems behind you, is there a way to settle . And what i can tell you is there is at least what im hearing indirect conversations the judge here has been encouraging both sides to try to do something when we say indirect conversations, you know, the old back channel, you dont want to have the principles talking to each other but there are ways to communicate and see if there is something that can be done what would that be well, maybe you slightly reduce the macron takes back the letter, the meaning of the word should or could, you take that letter back, which has become less of an issue anyhow and move to a tender which can get the deal done very quickly and have the effect of closing the deal before the next dividend payment, which we know those Dividend Payments drove Bernard Arnault crazy. But well see. I want to keep a close eye on this if you were going to come to some point where you were going to be able to forge a new transaction and slightly lower price, get the uncertainty out of the way, not go to trial, now is the time to try to get that done carl, back to you. All right, guys so much to process as david says lets get to bob pisani, see whats moving, hey, bob. Happy tuesday no announcements to throw us off, though europe is still down 1 take a look at the sectors, similar pattern to yesterday, now, the semis are holding up all right. Xilinx is up 10 or so Consumer Staples again, outperforming. Defensive sectors looking better but the cyclicals, like yesterday, industrials, energy, banks, down for a second day in a row. Banks had a great time last week not so good this week as yields have been moving back down what is moving as well, these thematic tech etfs, these investors love buying, lithium and gain, Cloud Computing etfs, 3d printing etfs, every day they move up on decent volume, a lot of investor interest in buying tech in this particular manner the thing is guidance. What i see is the lack of it big companies, not really providing any kind of explicit guidance again, this is a problem for the analyst, caterpillar, 3m, xerox, Stanley Black and decker, harl harleydavids harleydavidson, raytheon, look at corning didnt provide any explicit guidance, labcorp analysts are trying to figure out what is going on first and Third Quarter. You see earnings come out and very wide disparities between what the analysts are thinking generally, theyre beating, the analysts, without any guidance are being very, very conservative here f you see t if you see the numbers, 83 are beating way above. It is still 20 beating. The average beat is 20 . Thats huge with the third of the s p reporting already. I keep pointing out, theyll beat by 3 , 4 , 5 20 , third reporting, thats an amazing beat what were seeing here is not a lot of movement on the stock prices and thats a little bit disconcerting. I want to show you whats going on here with cummins, huge beat, 40 above the median price estimate was and no analyst got close to the number they reported this is historic high for cummins. They do engines and engine parts. The company i think highlighted exactly what the problem is with earnings season. The ceo, were encouraged by the recovery in demand, across our markets in the Third Quarter visibility on future order remains low and the impact of the virus on economies around the world remains difficult to predict. That is exactly the problem we are having a problem with the Fourth Quarter estimates because were hostage to what is going on earnings trends were seeing here, guys, strong beat so far companies are beating, but not seeing a lot of price gains overall. Is the good earnings news priced in maybe. It is more likely the macro factors are overlays are really making it difficult to figure out what the prices are and those are the stimulus, the vaccine and the elections overall. Carl, back to you. All right, bob, thanks so much bob pisani tenyear yield easing back into that familiar range this morning. Lets get to rick. Good morning, rick yes, were definitely losing some upward horsepower to Interest Rates that we really started to see after retail sales a week ago friday. If you look at a twoday of 10s, couple of things, first of all, yesterdays low yields, our low yields before our time zone, about the same the minute we violated that, you can see what happened. What is also interesting is that occurred 20 minutes before very good durable goods orders. Didnt slow it down. Rates kept slicing right through. One of the reasons, look at the s ps, they were going hand and hand and the weakness in the equities is one of the reasons we seem to be losing ground on the selling pressure as there was nervousness that rates may have to go higher to a better economy. The yield curve, we can tell it is all long end, it is flattening short end, glued to the wall as far as what is going on with the dollar index and foreign exchange, the best thing to look at there is the euro versus the dollar if you look at it over the last week or so, you can see it is definitely consolidating around 118. The dollar index also cons consolida consolidating, lower level carl, jim, david, back to you. All right, rick, talk to you later. Rick santelli. Look at 3m today the worst performing dow component, close it a onemonth low here, despite a beat on the top and bottom line. Well talk to mike roman about medical Equipment Sales and what may be driving the shares lower later this morning on squawk on the street. Dont go anywhere. The market as well as as well as profitability and Free Cash Flow generation, but more importantly than that, we really believe that together we can define the future of highperformance computing thats lisa su with us earlier in the hour. The shares are down about almost 4 but theres a readthrough carl microsoft reports tonight. The move by lisa su is in some ways a double down xlinx has a good mosaic business shes drawn to the data center and davids arbitrager lock in a gain 35 billion. If data center is as strong as lisa su says maybe azure is strong, big client of hers and the readthrough is that you should buy microsoft maybe even going into a sell between say 1 00 and 2 00 today because Microsoft Might have a very good quarter, based on what shes saying david, your ash tranl rbitragere coming in wrecking this. Theyre not wrecking it a number of weeks ago a deal was seemingly very, very close and then you had a cinareinterregnu whey what interregnum period of time dont be a misanthrope you guys are too fancy. The industrials and energy weighing on the dow at least rfme 3m, boeing, chevron, worst peorrsthe s p is hanging on to e point. Its time you make the rules. So join the 2 Million People who have switched to xfinity mobile. You can choose from the latest phones or bring your own device and choose the amount of data thats right for you to save even more. And youll get 5g at no extra cost. All on the most reliable network. So choose a data option thats right for you. Get 5g included and save up to 400 dollars a year on the network rated 1 in customer satisfaction. Its your wireless. Your rules. Only with xfinity mobile. As we say dow laggards including caterpillar and 3m, part of the commentary says that stationary and Office Demand nor products declined as a lot of businesses and offices and schools have been closed due to the pandemic, something to talk about with mike roman in the ne hr ua oth street. Wkn e dont go away. Lets get to jim and stop trading. A quick homage to johnny cash called the ring of fire. We put our masks on, right, and you cant see it because the wonders of the makeup people, but i have the ring of fire that comes from my mask so what do you do . Youre supposed to use skin cleaner by estee lauder. We know them as makeup but they also have skin care and been in the decline, now its in advance because of zoom and with zoom, i got to tell you, the ring of fire stands out. Im tired of paying homage to johnny cash. Im going to use estee lauder when i get home. Come on, we all know what are you going to do do you think this area right here, you can clean this area. This is brand new i destroy my face daily i cant even shave yeah, jim, its what were living with right now. Yes were learning to live with it everyones got an answer. Tonight, centene, and talking about politics and what managed care looks like under maybe a different president or this one, and then i have raytheon, and a lot of people feel wait a second, are you levered to an industry that people are very worried about, aerospace i know id be worried with it if i was in its row Space Business when you have a caseload of 08,000 people and fly to countries and theres five people on the plane and ten stewards, so we got to talk about that nice when we had greg hayes on this show once, but good for you, jim thank you, david. Youre welcome. Thank you for keeping the questions hidden what do you think hes like no hidden questions you can runbut you cant hide youll fly like a butterfly, sting like a bee uhoh, breaking news im sure the ceos love being fought over, jim well see you tonight. You bet mad money 6 00 p. M. Eastern time good tuesday morning, everybody. Welcome to squawk on the street. Im Carl Quintanilla with david faber and sara eisen markets pretty tight range here as we watch earnings and covid levels and lack of stimulus, and mega m a out of amd and xlinx. Lets get Consumer Confidence with Rick Santelli hi, carl. October Consumer Confidence number expected around 102 we have a miss on this one, 100. 9, so a bit under 101, definitely were backtracking a bit. Last month 101. 8, and if you look at the low water mark, it was right around april at 85. 70, a sixyear low so a bit disappointing on that, and if we go through present situation, 104. 6 versus 98. 9, so thats definitely a nice improvement, and finally, expectations, what may lie ahead, that is 98. 4, and that is a huge miss following 104. 0, that was downwardly revised 102. 9. Here is a pleasant surprise, for october read on richmond fed, it moved to 29. 29 is the highest read ever for the series of data going back to 1993 carl, back to you. All right, rick, thank you. Rick santelli helping us fold those numbers into this already busy q3 earnings season. Vi binky chadha is with us and david bayland, chief Investment Officer at Citi Private Bank good morning guys, good to see you. Good morning. Good morning. Binky, looking overd no bane beat beat ratios on top of the bottom line better than weve seen in a decade but market not responding why is that i think the important thing to keep in mind is when we went into the previous earnings season, we were just coming out basically of the bottom in terms of the equity markets, and so if you look at equity positioning, our measure was sort of at 25year lows we were sort of in the third or fourth percentile by the time earnings season rolled around. When you got a big beat, you know, the market basically covered. The market typically rallies in earnings season but its typically alittle bit less than we rallied in the last season closer to 11 . You fast forward the tape to this earnings season, you look at our measure of equity positioning, we are right in the middle of the historical range, so were getting a big beat. I would say those beats are bachkcal basically well in the price and positioning is basically neutral, so i think in terms of the equity market, its sort of already happened is the way that i would put it yes, im looking at some charts also out of deutsche that say this could be just the fifth time, david, in the last 16 quarters, where the s p is down during earnings season is there anything that the company has yet to print to change the mood . I dont think its about the companies. I think its much more about the environment that were in right now. We have the election straight in front of us. Vice President Biden were going to come into office is it a significant tax change the market is concerned about that more than anything, and then right after that, in november and december, we fully expect theres going to be several vaccine announcements that are going to be very significant. And that should be followed in january regardless of who is president with some fiscal stimulus so were really in a quarter right now where the news on corporate earnings is good as we heard and continue to hear but people will be dealing with a great deal of uncertainty and enormous amount of coronavirus in the west in the u. S. And in europe and faced with that, were going to have a difficult Fourth Quarter were actually going to have our economy slow down a little bit it certainly didnt have to do that, had there been stimulus, but it will, and as a result of that, people are going to be a bit wary when we look at 2021, we see the exact opposite, which is were going to have a relief moment in the market, when they realize the pandemic will be abated by the release of several vaccines. There will be certainty about who is president there will be fiscal stimulus coming out of some kind or other, a large one if its the democrats or a medium sized one if its a mixed government, and so theres a lot to look forward to and were dealing with a quarter of uncertainty, thats really what were going to see not only what happened on last couple of days but were going to have other days like this over the course of the next several months i think a lot of people, david, would relate to that view, that things will look better in 2021 how do you want to be positioned therefore in the markets, short term bumpiness and uncertainty and headwinds potentially longer term growth setup . Thats right, and that really is the big challenge right now everyone is sitting there especially ultrahigh net worth clients with too much cash so were saying to them, ask the question how much cash do you want to hold for the next five years and then look at rotating, away from the companies that have done so extraordinarily well, the ones that have carried us over the chasm and those were our Technology Companies the large ones and begin rotating into value stocks and financials, begin rotating into emerging markets, begin rotating into health care, which is suffering from a lot of uncertainty associated with a potential democratic president , think about changing your portfolio to reflect now what might be taking place in 2021, but do not start to sell, and try to market time, because i think thats a fools game especially when markets are moving as quickly. You heard ricks data for today, which is quite positive, if you consider the context of that were in a pandemic to have that level of Consumer Confidence and those kinds of prints. Those are pretty good in the middle of having 85,000 cases of coronavirus a day. So we want our clients to stay invested but want them to rotate into these areas of the market that could be very valuable over the next 18 to 24 months yes, durable goods, too, very strong its sort of already happened, binky, if you look at the best performing groups and industries in the month of october, it is groups like small caps, financials, industrials, the cyclical groups that have lagged behind for most of the year that would be positioned for a better economic backdrop. Is that where you want to be, too . Thats exactly where we are positioned i think the one other aspect of things that you didnt mention right now is the potential for a vaccine, and positive results, and you know, i think if you look at the s p 500 from the index point of view, you know, we basically are not from new highs well above where we were precovid but if you look at the composition of the rally, its really been led by beneficiaries of the pandemic, the rega cap Growth Stocks and defensives have basically done well so from a logical point of view, from a positioning point of view, i would argue you want to be long basically, you want to have a cyclical tilt and long in the reopening stocks david, one last thing, id love for you to dig into the markets potential worry about increasing tax rates, because we have heard that a scenario spun from a biden white house, but its also been tempered by the idea that markets would eventually shake it off after a bout of selling t would be offset by fewer tariffs, more fiscal spending. Netnet, how negative is it for the market i think you hit upon a good point. First of all, everyone is presuming the first thing a democratic president would do is work on taxes and thats probably crazy whats going to happen is fiscal stimulus coming out first and potentially some infrastructure activity youre going to have an abatement of trade concerns and those are significant, right weve been suffering for the last two years under a lot of trade uncertainty, and you have a pipeline thats largely not full theres not enough inventory and not enough goods being shipped across the world so theres a good backdrop, macro economically therefore, will there be changes in taxes absolutely what might they look like . Thats a question, will they be as radical as put forth . Our view is there will be a moderate change in tax policy. We want to advise clients not presume the worst case scenario. In terms of this year, youre asking a separate question which is this year, people are going to think about whether or not to take gains and so you could have a bout here of selling across different parts of the market, in two different ways. One is your highest gainers, and a lot of tech stocks could come under pressure from people who want to take profits and pay less tax to do so, again, anticipating a change and the second are areas that have already lost money, use energy as an example, where taking losses there could offset the games may be prevalent you could see in the sort of late November December time frame a bout of tax selling that would present some interesting Market Opportunities as an entry point opportunistically. Yes, really good clarity from both of you guys, as the markets facing a lot of binary outcomes in the short term. Binky, david, thanks talk to you soon thank you lets get to our meg tirrell with earnings from pfizer, merck, eli lilly and meg, of course, all pursuing various things in terms of covid as well, whether its vaccine, monoclonal antibodies or oral antivirals. Yes, all of the above, david. Were getting updates on all of those this morning that investors are watching as closely as the earnings which were a mixed bag for all of these companies, only merck up there as it did beat lets start with pfizer and that company having a bit of a mixed quarter, and tightening its 2020 guidance range, but of course, all eyes for pfizer are on an update for its covid19 phase three vaccine trial potentially expected this week some were disappointed we did not see it this morning. One piece of news also out that pfizer has not connected an interim analysis of those data, which people in the biotech world are watching closely because they think that might have implications for how well the vaccine protects against covid19, but guys, it could also just mean we havent seen that many infections in the trial yet, and the pfizer call just started at 10 00 so well be listening for a lot more about that on to eli lilly, this company missed expectations on the top and bottom lines in the quarter. Noted that theyre facing pricing pressure for some drugs particularly in diabetes the focus there in covid is their antibody drug. We learned the trial from the nih that had been paused as they look into some effects there is going to be stopped completely, because it just didnt look like that antibody drug was helpful for patients who are hospitalized with covid19 companies saying they are confident that the drug could have benefit for patients earlier in the course of the disease. Finally, over to merck, they stopped expectations for the quarter, strengthened keytruda their big cancer drug. Theyve been quieter about their efforts in covid19 but they have the antiviral drug they licensed from ridgeback, saying they expect to have results within a couple months on that drug, in phase two three trials developing one has started human trials, the other should start soon they say and they expect the first results by the end of the year guys meg, i spoke about the oral antiviral earlier on squawk box as well, because ive been following it closely, whereas you follow all of these things but id love to divert for a moment to oncology, because maybe we dont talk about it enough its saving lives, too, and in fact theres been such a revolution really over the last decade, keytruda, those Sales Numbers were extraordinary and new indications all the time that is a drug that has sailed from success to success and really is sort of a capstone on the career of Roger Perlmutter, mercks head of research who is actually going to retire in a few months, sort of a bittersweet goodbye on the call today after the news announced a couple of weeks ago. So that drug really beat expectations in the quarter. Its still growing throughout covid, success in lung cancer and other kinds of cancers so thats been a real driver for merck. Of course, some people question is the company too dependent on keytruda theres always going to be both sides. For now as you said, meg, quick question on the antibody drug from lilly no longer being used because it was deemed ineffective on hospitalized patients does it mean anything for the other very promising Monoclonal Antibody treatments out there, including regenerons . Not necessarily, sara and doesnt mean this drug should be counted out. Lilly has applied for emergency use authorization in people who more recently have been diagnosed with covid19. They expect that because of the way this virus works the antibodies might be helpful earlier in the course of the disease. Regeneron, you know, they are still testing their drugs, waiting for results in hospitalized setting as well, in addition to being used earlier for which theyve applied for emergency use authorization, so well have to wait to see the regeneron results, see if all antibodies work the same, if there are differences in the way they run the trials but still a lot of hope for antibody vaccines in covid. There are different antibodies and regeneron is using a cocktail and not exactly the same meg, thank you, meg tirrell. After the break rick caruso on why hes feeling optimistic going into the Holiday Shopping season we have a big show ahead here on squawk on the street. Nasdaq is up 0. 5 . The s p 500 up a little more than 0. 1 . Dow is still negative bouncing back from yesterdays big losses upbeat music we did it crowd cheering [narrator] wherever you start, snhu is where you can finish. crowd clapping crowd cheering here we go. [narrator] and its it. [group] yay [narrator] you did it, high five Southern New Hampshire university. [man] that gets a hug. laughing look at that masters degree, i did it i did this for my children. I am very proud of myself. [narrator] finish your degree at snhu. Edu. At the retail sector, as it tries to claw back after two quarters of covid restrictions, a new gallup poll finds americans plan to spend much less this Holiday Season, just 805 per person, down from 942 last year. What does it mean for mall operators . The own are of Properties Like the grove in los angeles and the commons in calabasas Caruso Properties founder and ceo rick caruso. Good to have you on the show again. Thank you, good morning the gallup numbers dont bode well for the Holiday Shopping season but youre feeling optimistic why . I think theres hope for the holidays im not a real fan of these gallium polls or any kind of polls that take a look at a national level, because the reality is the country is very different geographically well go into different weather patterns and different types of properties and different types of stores. Now, let me tell you what were seeing on our properties, growth week over week, month over month and seeing a very high conversion guest, meaning the people coming onto the property are spending more, theyre converting to greater sales and the convention, the spend is about 40 higher, so were down on our Properties Across our portfolio about 10 to 12 , which given the fact that theres less people shows theres really a committed shopper who is looking forward to getting out, having an experience, and is actually buying, but you know, thats our experience we are blessed here in l. A. , with good weather, and sunshine, and we have all outdoor properties, and we also have, you know, incredible retailers that are best in class theres also, though, probably, rick, a ton of pent up demand from being locked down for so long, and theres the impact of the stimulus, and the higher savings rates, which we know are starting to get drawn down i think the question is, how sustainable is the kind of boost that youre seeing well, i think its a fair question, but remember, september was the first month we didnt have stimulus, and we still had growth in sales. In fact, nationally we had growth in sales, almost 2 on retail sales so that does bode well so i think what youre going to see is there may be a tale of two cities as the east coast, the midwest is getting colder, the west coast stays warmer, to see how things play out, but i think your point is a really good point theres pent up demand there is definitely fatigue over covid. People want to get out of their houses they want to have an experience. They want to be with their family and friends doing it in a safe way, and i really think people want to celebrate the holidays we sent out 130,000 emails as a survey to customers. 85 reported back that theyre going to be on our properties to celebrate the holidays and the number one thing was to have festive decor and the number two was to shop. So im feeling good about it, and i think there is going to be a really, really high demand for people to get out of their homes. Yes, amen to that i think a lot of people feel that way, rick, but at the same time, none of us know how this virus is going to keep moving. Unfortunately were hitting new high case counts you cant predict that either but you seemed fairly confident, if we still continue to go up, are things going to change, i mean go up in terms of new cases every day . Well, its a good question. I dont know consumer behavior, were a little bit more tolerant i think people are more comfortable with safety. I think people now also realize if you wear a mask, and we require that on our properties, and you have social distancing, you can be in a much safer environment, so people are out, and i think we all have to learn how to manage this weve learned a lot from it, but theres also, youre right, that fear factor that if it really spikes, more people may stay in. Again, i think a lot of it is going to depend on age, demographics, that are going to impact how people really work through the Holiday Season, if theres a spike in covid i see here, rick, that you have been increasing security on your properties, in advance of the election yes what exactly are you planning for . Well, listen, obviously were hoping for the best. Were planning for the worst we have to be careful. We have to protect our guests, and we will. We have to protect our properties if theres going to be protests, which certainly people have the right to do, and we support that, and celebrate that, thats great. If for some reason theres people that i would consider to be knuckleheads that want to do things that are destroying property, at our properties or around us, were going to make sure were protected so listen, i hope its going to be peaceful. I dont think we should tolerate, frankly, in this country, anything other than peaceful protests, and im hoping thats where everybody decides to do, and to do it in the right way and express their opinions and their voices. Umhum. Amen to that as well just a question about your tenants and the future of retail weve seen a lot of struggles with mallbased retailers. What would you say distinguishes the winners from the losers right now, and to that question, how many of your tenants are actually back to fully paying rent and good financial shape . Were close to 90 of paying rent so were in good shape. The 10 really reflects smaller retailers that weve been supporting, smaller restaurateurs to get back. We think thats important to be supporting Small Business, because Small Business in this country just has gotten hit hard, and l. A. Very, very hard, about 15,000 businesses have closed so were doing well. Were happy with that. Youre going to have to be innovative as ive said before on this show, the thing that is the risk to retail the most is its current version, and retailers that arent innovating, that arent changing, that arent exciting to walk into their stores, that dont have great omni channel, that doesnt have a really engaging brick and mortar presence and the right locations, theyre going to suffer, and i think what you see gap doing, announcing theyre going to close the majority of their inmall stores, 80 of their stores are going to be outside of indoor malls, thats the right thing to be doing because theyre following the customer the customer wants to be outdoors they want to be on the streets they want to be in an interesting environment, and its just covid is the great accelerator, and if run a trajectory and not being relevant, youre really not relevant now so great retailers are doing well look at lululemon, look at nike, incredible performance but their stores are engaging and ecommerce is engaging you own shopping malls and youre applauding gap for Closing Stores i own indoor malls. Thank god, what they said is they will not be in indoor malls. I applaud them for Closing Stores because what retailers have done over the last decade is built too many stores for the sake of growth, and the reality is, those stores became unproductive, and then they became tdisengaged so what retailers need to do, i think, and you see the good retailers doing it, less stores. Theyre going to be smaller, i think theyre going to be more curated and more local and youre going to see stores shifting out of major metropolitan areas, more into neighborhoods. Youre going to see our consumers, which you do see, gravitating to the suburban areas. Retailers are going to follow them there and theyre going to be a smaller format and more productive big changes rick caruso, always good to hear from you thank you for joining us yes, thank you. All right, lets have our etf spotlight and look at the industrials, ticker xli, some big names in that Group Reporting earnings including caterpillar, which is under some pressure today, after reporting a 54 drop in earnings for the Third Quarter. Sales did decline across all regions and sectors. You can see its down about 3 and you also have 3m that did top profit expectations. It was up by Strong Demand for its Health Care Products amid the pandemic the stock is still down for the year you can see it is off a bit today. As well. Well take a closer look at results when the ce, off 3m, mike roman joins us. Squawk on the street will be right back turn on my tv and boom, its got all my favorite shows right there. I wish my Trading Platform worked like that. Well have you tried thinkorswim . This is totally customizable, so you focus only on what you want. Okay, its got screeners and watchlists. And you can even see how your predictions might affect the value of the stocks youre interested in. Now this is what im talking about. Yeah, itll free up more time for your. Uh, true crime shows . British baking competitions. Hm. Didnt peg you for a crumpet guy. Focus on what matters to you with thinkorswim. With two new haunted houses, the screams are just getting started. Wear your favorite costumes and the fun never ends. Come get your halloween on, happening now at universal orlando resort. Good morning, everybody. Im sue herera here is your cnbc news update at this hour. Amy Coney Barrett is the supreme courts newest justice, sworn in last night shortly after the Senate Confirmed her nomination. Her first votes could include topics including the man who appointed her including a plea from President Trump to keep his tax returns from a new york city prosecutor in california, evacuation orders have been issued for more than 100,000 people. Southern california edison says its equipment may have sparked the blaze. Red flag warnings are set around that state as dry conditions and fierce winds are expected to continue today east of los angeles, the winds have been Strong Enough to flip tractor trailers onto their sides. Gusts of more than 65 miles an hour rolled over at least five trucks in philadelphia, violent protests in the wake of a Deadly Police shooting, 27yearold Walter Wallace approached officers with a knife, and ignored orders to drop the weapon the police then opened fire, at least four officers have been hospitalized after reportedly being hit by bricks. You are up to date that is the news update this hour sara, ill send it back to you sue, thank you. Sue herera a Las Vegas Sands without vegas . Contessa brewer looks at the casino giants entertaining an offer for its vegas property contessa sara, the casino giant confirms very early discussions are taking place over selling its las vegas property nothing has been finalized the venetian pa laz zoe and sands and Expo Conference center are among the most valuable strip properties, they have some 7,000 rooms but makes up less than 10 of sands erlgz. Sheldon addelson is focused on Asia Business and opportunities for growth in macau and singapore. Analyst thomas allen points out an offer of 6 billion would be neutral for the share price but china pays a royalty to las vegas of 2 billion. If sands retains the royalty payment allen estimates a 3 boost per share. I asked a Company Spokesman who is participating in the discussions on the other side of the table. He would not say if theres a for sale sign on the properties. We would not say i just wrapped up an interview with competitor Derek Stevens who owns the d las vegas and golden gate and launching opening this brand new casino downtown tomorrow. He told me this news is all anybodys talking about in vegas today. We were all a little bit surprised about this at this point, but obviously their model is a little bit different as well in las vegas. Its convention orientated and going to take a little while for that segment to come back. He remains bullish on the future of las vegas, on the return of Group Business he thinks, and he said so on the Third Quarter earnings calls thats going to happen sooner than later carl yes, its fascinating, contessa b of a has a note asking who can afford to write a 6 billion check these days its a great story we know youre on top of it. Coming up later, well talk about the casino face with jim murren on squawk alley. Amb is finalizing its deal or xilinx well be right back. Dont go away. We really believe that together, we can define the future of High Performance computing, and you know im a very ambitious person. Its all about what we can do to transform the industry, as well as participate in driving sort of the next phase of computing and thats what xilinx is all about. Its a fabulous company, i would say its one of the best companies in the industry. Its a very, you know, unique capabilities and we are so complimentary and you really see that when we think about the product portfolios, the Market Segments that were in, and culturally, were also very aligned as well. So its a very, very good day for amd and were very excited about what we can do together with xilinx. Knowing were prepared for the future. Surprise we renovated the guest room, so you can live with us. Oooh, well. Im good at my condo. Oh. I love her condo. Nana throws the best parties. Well planned, well invested, well protected. Voya. Be confident to and through retirement. Heart monitors that let your doctor watch over you, just like you watch over your best friend. Another lifechanging technology from abbott, so you dont wait for life. You live it. Election day is one week from now and cnbc has an allamerica economic survey, which candidate would be best for the stock market Steve Liesmans got that hey, steve good morning, carl. It may not be the most important issue in this election but more americans think donald trump would be better for the stock market than former Vice President joe biden. 45 of americans say the stock market will go up in the year if President Trump is elected, just 32 say so for biden 25 think it go down if trump is elected, 38 for biden and more biden supporters think the markets going to go up under trump than Trump Supporters think it will go up under biden. The Overall Investment numbers weve been chronicling for years, 41 think its a good time to invest, 35 not its a little pessimistic relative to the 16 and 2017 but weve recovered a bunch, if you look on the right side of your screen of that pessimism that camealong with the onset of th pandemic when it came to the stock market and the stock markets performance has borne that out one concern of the public, very much like the concern of the stock market is what will happen with stimulus. Looking at the right side of your screen there, 49 think the biggest, their biggest worry is the government will spend too little on relief, 39 say too much, and thats a reverse you can see of the 2009 crisis, when there was more concern about the Government Spending too much or concerned about deficits in the public so a lot of support for the stimulus, and finally our Top Resources rorm former Vice President joe biden leading President Trump by 11 points in our Overall Survey of 800 americans with a margin of error 3. 5 and that lead has grown from five points to nine points and now its 11 points david, a lot of ways for the race to still tighten up, but its a commanding lead for the former Vice President. Nationally, as we know. Of course given our Electoral College system, its those battleground states that really matter, steve. But thank you. Thats why we have our states of place survey, david, come out next week, we do the national with this and then we also have the states that play but looking closely at the battleground states i assume coming out before the election the day of actually i checked this morning the day of, okay. Steve, thank you after the break, dont miss, well have an exclusive with 3ms ceo mike roman. Squawk on the street is coming right back blockbuster earnings from five top tech giants this week, a combined 7 trillion in market cap on the line. Find out what to watch, key metrics on tradingnation. Cnbc. Com more squawk on the street coming up. For as little as 5, now anyone can own companies in the s p 500, even if their shares cost more. At 5 a slice, you could own Ten Companies for 50 instead of paying thousands. All Commission Free online. Schwab stock slices an easy way to start investing or to give the gift of stock ownership. Schwab. Own your tomorrow. Hey frank, our workers comp insurance is expiring, should we just renew it . Yeah, sure. Hey there, Small Business owner. Pie insurance here with some sweet advice to stop you from overpaying on workers comp. Try pie instead and save up to 30 . Thirty percent . Really . Get a quote in 3 minutes at easyaspie. Com. Wow, that is easy. So, need another reminder . No, no no, im good. Uh, yes please. Oh. Ho ho ho, yeah need workers comp insurance . Get a quote in 3 minutes at easyaspie. Com. 3m beating estimates that posted a profit of 1. 4 billion in the Third Quarter and as as we came into q3 the question of whats happening in the channel around that, we see the Distribution Partners that we work with in each of these channels, theyre cautious as they look into the uncertainty of whats going to be the impact of covid, and they are not driving a big restock. We did see some restocking in health care. I would say medical solutions and oral care for us, we saw restocking through really the first couple of months of the quarter, and then its been, i say cautious as we move into q4. Right, but i mean i guess, and you said this as well, your inventory levels, you said count on us to make sure our inventory levels from a velocity perspective keep improving, but i guess its very difficult as the pandemic continues to go on here to figure out how, where your production levels should be, isnt it yes, theres a lot of uncertainty out there. We still have our guidance suspend suspended, so we are cautious as we move ahead. We expect some of the trends in the markets to continue. We did high light on the call that we saw electedtening as we september into october were managing our inventory around the demand that were seeing, and weve got almost half of our businesses are down seeing declines in their end markets year over year so were managing businesses that are down significantly at the same time, were managing businesses like our personal safety business thats got big uptick in demand, so were managing our production levels around that, were managing our supply chains around that, and our inventory we did make Good Progress in q3. We saw Strong Demand driving and i think we reacted effectively to it. One of the things i highlighted is how weve become much better at reacting quickly to the changes that were seeing in the market, thats been something our teams have focused on and really a strength as we go forward. So we do expect to be able to manage through those, that uncertainty and be able to continue to improve our velocity on our internal inventory, and then were also watching closely whats happening in the channels that we work with. Im sure Something Else youre watching closely is simply sort of how the virus is progressing, unfortunately, through the population, both here and around the world. I mean, i know you have multiple scenarios, i would assume youre gaming out in terms of some of the things we talked about, mike, but what are your best guesses in terms of what it means on the Positive Side for some of your businesses and on the negative for others . Well, it really is the big factor out there as covid goes, so go the economies. We arent even putting guidance in for q4, because the uncertainty we see we see trends in the early parts of october, as weve come through to date. The trends that are similar to what we saw in september, so were seeing Strong Demand, as you would expect, in our personal safety products, personal protective equipment. Home improvement continues to see Strong Demand. We see Strong Demand in digital firsts kinds of impact like our data centers we see Strong Demands on biopharma filtration at the same time we see softness in areas like Office Products and hospitality, boil and gas, all areas that we see continuous so the trends have continued early. October, the uncertainty says weve got to be ready for, as you said, multiple scenarios, so we are managing daily rhythm really as we execute its really i think part of what i compliment our team on, executing well in q3 was managing that daily rhythm around our operations. Yes, mike, its a great point and something thats come up repeatedly this quarter with companies who saw sharp spikes in demand back in the spring, whether its Consumer Products or in this case medical equipment. I wonder, i mean, generally the point has been no one was in position to account for such a rapid rise in demand over the course of just a couple of weeks back then. Now its a much different story than is that generally true . Is it generally true that the shortages like we saw in the spring would be virtually impossible now well, the changes we saw in the spring and our markets, carl, they were significant, and we did incredible job i think of responding to the outbreak of the pandemic in areas where we saw big uptick in demand, personal protective equipment. We followed through on our commitments to double our production in the early weeks of the pandemic and add capacity through our own investments and partnership with the department of defense weve now followed through on that and added that capacity to be stepping into what we saw as a potential for a second wave of covid cases, and we followed through on the commitment to bring over 200 million respirators in from production overseas into the u. S. Because of the demand here, and so we have found ways to react and react to those changes the uncertainty says we are going to see more change, as we move ahead i think the magnitude of some of these areas wont be as big a step up partly because were better prepared. We are bringing capacity on. Were making more n95 respirators than ever and continue to add capacity into the end of the year into next year i think were better prepared is part of the answer, carl, of why we will be ready to react and smooth out some of those big, big changes that we might see. Mike, its sara thats certainly good to hear, as we see these record case numbers, and we look to our hospitalizations, which are higher again, but i asked you this a few months ago. Were now in month eight why still do we not have enough n95s that consumers, like you and i, can go out to the store and buy them to better protect ourselves for this virus yes, theres a strong consumer demand out there for n95s they have a strong reputation and theyre recommended for the best protection. Weve been, as you know, sara, focused on prioritizing Health Care Workers and First Responders and thats been the case as we ramped up our production and delivered now on track to deliver 2 billion n 95 respirators, still globally in the u. S. Its focused on the First Responders and Health Care Workers on the front lines and to a degree, weve been supporting the reopening of the economies and some of the Critical Industries out there, also supporting the fight with the pandemic, so we have had three priorities as weve gone through the pandemic as a company, protect our employees, fight the pandemic from every angle and deliver for our customers and shareholders and focus on the execution that we need to do around those. That fighting the pandemic is still front and center, and so what we are doing with our n95 production is helping to get that to the front lines of those Health Care Workers, First Responders and working in partnership with organizations like health and Human Services to make sure were focused on the hot spots. That still is the priority well continue to look for ways to support consumers, and our consumer teams are looking at innovative, new mask kinds of solutions, in addition to the n95 respirators, so well work to respond to that as well interesting new Math Solutions essentially. Where does that stand . What is the likelihood of it receiving some sort of emergency approval and being on the market and when would that be we have great partners as you know we have low cost saliva based, paper based test that give you Rapid Response to covid19 testing. We are we completed our Laboratory Testing were now working with an independent lab to validate against live samples, blind testing. Looking at confirming the level of detection, sensitivity. So work is were in the middle of now that is Still Development work from there, we would if everything went well, we would be looking at working with the fda on a emergency use authorization which would be first half of next year kind of time frame so this is a, you know, i would say were in that evaluation, validation and Development Phase with our partners. Mike, always appreciate you joining us and giving us an update on the business and the efforts being made to combat the virus. Thank you. Thank you, david. Mike roman, ceo of 3m. Quick break, later on closing bell, well have big guests lined up for the hour including twilio jeff lawson, robin hayes and a lot more all starts at 3 00 p. M. Eastern time today squawk on the street is going to be right back nasdaq is up. 6 were getting a little bit of e sss me roh ovthug thseion. This is the new iphone 12 pro with 5g and its on at t, the fastest nationwide 5g network. Now, new and existing customers can get our best deal. Really . mom at t has the deal for new and existing customers i will. So whatd she say . Its the wrong person. Its a guy named carl. But hes very excited and on his way. Wordofmouth advertising. Its what they did before commercials. Its not complicated. Everyone gets our best deal, like the amazing iphone 12 on us. Welcome back to squawk on the street. Markets are mixed after yesterdays big selloff. Industrials, though, as you can see here among the worst performing sectors so far. And that includes the Airline Stocks that move lower comes on the heels of a nearly 400 million loss from nons p 500 component jetblue. They expect an uptick in bookings for day season. We continue to see a rise in coronavirus case as cross the u. S. I know sara eisen, the closing bell is always a packed show. But youll be talking about the airlines very specifically im looking forward to the interviews that you got coming up, sara thank you very much for that shoutout yes, we have the jetblue ceo on to talk about that and a whole lot more on closing bell. Lets talk amazon now. Gearing up for a busy Holiday Season we have more on the big hiring plans. Frank . Good morning, sara. Amazon announcing they will hire 100,000 seasonal employees to help handle a holiday peak that is expected to see historic volumes. This is actually a 50 decline from last years Seasonal Hiring more than half of these workers will work at the Fulfillment Centers or sorting packages. It follows the 100,000 full time employees last no and more than 300,000 total since march to meet this elevated demand. Amazon self delivery spiked 44 higher year over year in september. During this spike, amazon signature two day prime service saw the on time delivery fall from 96 to below 89 this september. The company adding more than 100 operational buildings in 2020 to help increase delivery speed amazon says california, texas, maryland, georgia, and new jersey are the top five states where they wire. We have identified the areas of strategic points that allow us to meet customer demand and, of course, safety during this recent spike in covid19 really a key concern amazon recently disclosed 20,000 of their employees have tested positive the company showing us thermal scanners that check employee temperatures on arrival as well as scanner called a distant assistant that noitifies employees when theyre within six feet of each other Safety Measures are in place of all the sites. How will the holiday hires help with safety and employees staying socially distant or will they allow employees to take more breaks . The company said they couldnt answer that question carl, back to you. All right frank, obviously one of the stories we usually love to cover, this year more than most because of the seasonal hire coming up on squawk alley, were going to have more on amd finalizing that 35 billion deal for xilinx were just off session lows in the s p 500 sitting right at 3400 dot ay. Ngowa good morning its 8 00 a. M. At amd headquarters in california and its 11 00 a. M. On wall street and squawk alley is live