Transcripts For CNBC Squawk On The Street 20240711

Close at the open. The road map begins with that renewed vaccine optimism and detailing their own strong data. Plus as for the market, the u. S. Stocks poised for new records and the futures are and investor optimism about that vaccine and dow is within striking distance of 30,000. We have a lot of deals this morning. Pnc looking to become one of americas largest banks and set to buy spanish bank and 11. 6 billion the Purchase Price and other deals to tell you about this morning carl lets start with the moderna news excellent news for the second week in a row. Dr. Fauci on some of the networks earlier today saying the data are striking and the results are just as good as it gets i really think we have to go back just a couple months and recognize that even if we had any hope that there would be a successful vaccine maybe 70 , 80 . 50 to 60 for the flu is something we learned moderna Insider Selling was bad and turns out the Insider Selling was bad meaning they sold badly i do think what happened here is we have vaccine monday, david. Where we have merger monday and vaccine monday and i think it is going to be astrazeneca. David, you continually wait for what we really need. The bridge is therapeutics and thats something we hadnt been good at. Look at this point, jim, the vaccines will be out before we get real therapeutics. Eli lilly has been approved for emergency use, but not a lot of it available when youre talking about 150, 160, who knows, 200,000 cases we may have pretty soon a day thats just not feasible because thats supposed to be infused early to avoid any real complications, jim so, the hopes for antivirals proceeding and being that bridge to a vaccine, i dont know theyll still be out there, though, when a lot of people are not vaccinated and therefore still be available in that same time when were starting to vaccinate people but other people are getting sick and hopefully the antivirals will be available then so a lot of people can feel a lot more comfortable in terms of leading a normal life, again carl, when we see numbers like today what happens is the Airline Stocks immediately go up and the hotel stocks and the retail stocks. And then what happens . Well, norwegian cruise the numbers are cut because there wont be any sailing until march, not january american dropped some very key lucrative roots. So, the younger buyers and i do think that the younger buyers who cant wait and have to buy at 4 00 a. M. , 5 00 a. M. , 6 00 a. M. , they are just so enthused and then the facts come and the facts just dont fit the story they do make you feel like it will eventually be good, carl. But i dont get the sense that were going to go on a cruise in the next four months i just dont think so. Yeah. Although, you know what, fid fidelity did some charts last night looking that goldman baskets, the stayathome baskt and hitting lower highs and the reopening although way behind is trying to catch up look, i think a lot of companies that are going to adjust you see a stayathome company and they can do Different Things theyre not just sitting there and saying, listen, i want to take a beating peleton and i have teledock on later this week. I dont think teladoc is something that comes and goes. A great deal with zoom i think these are things that are here to stay david, i do not hear anybody saying, you know what, were going to return to the hay day of when we put people on planes and spend a lot of money because the Gross Margins have been terrific for a lot of companies that can do things by zoom theres no doubt that a lot of companies have been able to save a great deal of money on travel and on so many of those things, as you say for some companies, you know, it barely moves the needles for others a major savings, jim. As we said many times. Listen, we can all sit here and talk about what things will be like when the coronavirus hopefully and thankfully is gone or at least, but we dont know i think we can assume fairly that Business Travel will not be back to the levels it was in 2019, perhaps not ever certainly not for a long period of time. That said, jim, do your point, we watched this last week with the Pfizer Vaccine moderna, this is great news. No doubt about it. 94. 5 in terms of what theyre talking about is amazing but were in the midst of covid out of control right now, jim, in the country and it looks like its going to be a very difficult couple months ahead if not more when these first doses get out from moderna and pfizer and unclear who they will go to and distributed. Thankfully this can be sent out at a higher temperature than the pfizer i say thankfully maybe makes it less difficult to transport in some ways although it does appear that theyre going to be ready for that as well, they can store it for up to six months at up to 20 celsius and up to 30 days normal refrigerator conditions. But my point or my question, jim, you know, last week we watched the same trade take place and by the end of the week, growth was coming back and we still have covid cases out of control in the country carl, the facts dont get in the way of the story guys, as david said, a lot to unpack in the moderna news the side effects and the standards for storage and the number of doses available. Meg tirrell joins us now hey, meg carl, that 94. 5 efficacy figure exceeding the bar that was set extremely high by pfizer last week with more than 90 efficacy and we actually got more data from moderna from this trial this morning we know the number of cases they saw in the study of 30,000 people thats how they determined the efficacy so, 95 people in the trial got covid19 and 90 of those cases were among people who were not vaccinated in the placebo. Just five were among people on the vaccine. Importantly, they also saw 11 cases of severe covid19 so, people who had elevated heart rate, low oxygen or had to go to the icu. All of those cases were among people who were not vaccinated on the placebo this suggests the vaccine could be highly protective not just against any case of covid19, but also severe disease, which would be tremendously important from a Public Health standpoint. Now, on safety of course, lots of questions there. What is this going to be like for people to take they didnt see any significant safety concerns but after the second dose people did report fatigue, muscle pain, joint pain so, this is going to be something that people will feel taking but Public Health experts argue it is better than getting the disease. Moderna intends to submit for the emergency use authorization in the coming weeks. Of course, guys, theyre really sort of on pace alongside with pfizer and well see this play out. Supply, of course, another huge question moderna saying 20 million doses delivered in the United States why the end of 2020. This is a twoshot vaccine thats enough for 10 Million People next year, globally. 500 million to a billion doses they hope to have available. We talked with the ceo of moderna about the pace of rolling this out and heres what he said. I think the vaccine, thats good hope that we should be able in q1 to get people at high risk vaccinated in the u. S. If they desire so. Guys, still a lot of questions, though. One is, does this prevent all infection . With sars the virus that causes covid19 or just prevent people from feeling sick with the disease . We dont know that yet thats something theyre digging further in to. The other question is how long does this protection last . We dont know that about Moderna Vaccine and the pfizer he thinks at least a year, we just dont know. So, theyre going to be following these people for longer to try to get those answers. But really good news this morning, guys. Back over to you let me ask meg. I know that j j is very bullish on what theyre doing and just make a huge number of our vaccine so if we do win, its going to be distributed. Was it just not possible for moderna to make any more than it was doing . Yeah, actually, we talked with stephane about that this morning and he pointed out this is their first vaccine they have ten others that they have been working on but this is their first commercial product and they had to build up this manufacturing capacity and establish partnerships and has one to help make all this vaccine. This year while they were developing this vaccine. Building the airplane while they were flying it, essentially. And so the nih is having a Conference Call right now where, you know, they were asked. Could they do more in terms of manufacturing this and so theyre talking about that and saying theyre trying to beat the targets put out there but as of now, this is what moderna was able to do when it struck the big partnership. Six months in a freezer and 30 days in a fridge and 12 hours in a room. Plus no special handling upon delivery how big of a deal is that . It should be ptremendously helpful. The ability to store it in a refrigerator at temperatures 36 to 46 degrees fahrenheit is now up to 30 days and before they said seven days. That should make it easier to distribute this particularly to rural areas that might not have the access to those extremely cold freezers where you need to keep the Pfizer Vaccine at minus 70 you can take the Pfizer Vaccine out and keep it at less cold temperatures for a few days. But then you have to have people lined up ready to get vaccinated and, so, simplifying those kinds of distribution issues will be tremendously helpful but both of these vaccines are going to be needed so, the trick is going to be figuring out where to send what vaccine and magiking sure to optimize what is available at the beginning. Meg, that was getting to my question remind us again. Pfizer is also going to have how many doses initially available or perhaps as soon as by the end of the year . Just trying to understand how many potential people could get a vaccine from moderna or pfizer in the december january time frame. Yeah, so, we heard from alex azar that pfizer is due to be delivering 20 million doses per month i believe starting in november together that would be 40 million doses from pfizer and also a twoshot vaccine so that is enough for 20 Million People. Moderna enough for 10 Million People and 30 million in the u. S. By the end of the year if ive done my math correctly and more coming throughout the early months of 2021 meg, another big day. And we understand it better thanks to you. Our meg tirrell having talked to moderna earlier this morning tweets congratulations to moderna. Our Companies Share a common goal defeating this dreaded disease and today we congratulate everyone at moderna. Pretty strong words. Science is pretty united. The glaxo, by the way. I dont understand why so many people are jaded about this. When i talk to people and say, yeah, but well never get there. It doesnt really matter and the scientists keep coming up with big wins and i think that six months ago we thought that the scientists couldnt come up with a win. I was ridiculed in New York Times for believing in science and i love that because i thrive on ridicule, but, david, you have to admit these people at these Drug Companies are not fools. They seem to know what theyre doing. Science seems to be our one savior even though many people dont believe in it at all was the course too hard were the classes too hard . Say it again. Were the classes too hard they took art. I dont know what tie took or didnt take. I didnt take a lot of physics or chemistry either but i believe in science and can be awfully thankful for the efforts that have been made. Truly amazing. But were not there yet, jim again, back to it. Lets come back to this moment here where we are likely to set new records for daily case loads. A lot of states are starting to see hospitalizations reach a point that is maximum in their ability. Weve got some states michigan, state of washington that are sort of starting to shut down certain parts of the state or certain activities and no real prospect you heard Mick Mulvaney earlier on squawk box of additional stimulus coming in the next couple of mun months we talked about this so many of the small and mediumsized businesses what is going to happen over the next couple months i had cisco on and tremendous resistance because you had outside. I think outside is going away rather quickly and then its just too cold. Guys, a lot to get to as we said earlier a lot of m a regarding home dep depot, Simon Property and were on the look out for a dow 30k at the open as the s p is on pace for the fifth best month in the last 30 years. Dont go away. The cofounder and ceo of the company partnering with pfizer on a covid19 vaccine says he believes daily life may return to normal by next winter. In an interview yesterday with the bbc he said if everything continues to go well, well start to deliver the vaccine end of this year, beginning of next year and goal to deliver 300 million until april next year which could allow us to already start to make an impact. He said, quote, im confident this will happen because there are a number of Vaccine Companies helping us to increase the supply and so that we could have a normal winter next year i getuess, jim, this goes back o what we were just talking about. That is still a long way away. Given the fact that probably what percentage of the country doesnt believe in the ways we can stop this physical distance, Contact Tracing has now gone, if half the country doesnt believe in it, then they prevail some of the hunger games like analysis that im seeing on my twitter feed is interesting. Like the great calling which i find to be hard to believe. I mean, carl, how could we have a calling in our country pretty good country. Jim, its amazing cnn had a nurse on this morning in south dakota whose patients literally in intensive care still dont believe its covid theyre trying to find other reasons why they might be in the hospital in very dire situations its incredible. And your point largely is a good one. Dr. Fauci this morning talked about the fact that even though it feels like this vaccine news is binary, the institution of it into american lives is not going to be immediate. Take a listen. If we get most of the country vaccinated in the second, Third Quarter of the year and the vaccine continues to prove its efficacy and people adhere to the fundamental measures, i think we can start approaching the degree its not going to be a light switch, jake were not going to turn it off and on going from where we are to normal. A gradual accrual of more normality as the weeks and months go by as we get well into 2021 thats going to be a process for the markets, too yikes i mean, that shows you that people who are buying the norwegians and buying the carnivals have to hope that theres enough cash because when you listen to that, i dont think that youll be able to go on a cruise. I was actually hoping for something that would allow me to get on a southwest air without a jammed packed southwest air going to see what, david disneyland which isnt open yet. Disneyland is not disney world is. 25 right as soon as we possibly can, this is all, this is good news. Lets take it as that. But we still know we have a lot of tough days ahead. If people dont wear masks, it makes it even tougher. We have two president s. Does that help we have one in the white house and one that is trying to get in the white house. And eventually lets see what happens on that day. I mean, i once was evicted from a building and it was odd. More on that later, carl. Yeah. Yeah november 13th odd couple day was last week. Well take a short break here. Well talk about what the president said over the weekend and what the president elect is expected to say about the economy when he speaks with Kamala Harris later on this afternoon. Back in a minute sales are down from last quarter but we are hoping things will pick up by q3. Yeah. Uh. Boss doug . Sorry about that. Umm. What. Its. Um. Boss you alright . [sigh] [ding] never settle with power e trade. It has powerful, easytouse tools to help you find opportunities, 24 7 support when you need answers plus some of the lowest options and futures Contract Prices around. Dont get mad. Get e trade and start trading today. Dont get mad. I made a business out of my passion. I mean, who doesnt love obsessing over Network Security . All our techs are pros. They know exactly which parking lots have the strongest signal. I just dont have the bandwidth for more business. Seriously, i dont have the bandwidth. Glitchy video calls with regional offices . Yeah, thats my thing. With at t business, you do the things you love. Our people and network will help do the things you dont. Lets take care of business. At t. Welcome back lets get to a mad dash. I mentioned that if you heard it because weve got this upgrade, well, weve got wells fargo initiating coverage on at t and verizon and they sort of one is a little hot and very different temperatures well, david, what i think is most interesting here is this pretty much is one of those situation wheres if you want growth tmobile is clearly the growth engine. If you want a good income, verizon. But, david, if you want to take the risk and roll the dice on a big dividend, it is at t underweight at t where tmo is an overweight and verizon is an equal weight david, warner media theyre saying far from a box office hit. Dividend secure, david, warner media did they just get, that was just a good idea going awry . What happened there . Well, you know, listen. There was an argument to be made that the year it took to fight for any trust approval beyond where they thought they would close the deal hurt them but they paid a very big price and the assets, you know, its a difficult time as we know and the key is direct to consumer and the key is hbo max and the success of that. And were still sort of trying to figure that out why is tmobile the best position why do they grow faster and why did it turn out the john ledger view was correct they were so aggressive so aggressive. And they seem to be integrating sprint quite well and dont forget they claim theyre extremely well positioned for 5g in terms of the spectrum that they have that they can deploy to over 100 million pops, 100 million population or more by end the of the year. One of the best stocks in the entire stock market. Really rather amazing. I have to hand it will he come on the show . No, he goes on the later shows. I throw my hands up. Ill work on that youll get him on mad. Good going, tmo more for you including a market open a big rally on the moderna news. Stay with us strong open this morning as dow futures at least are positive in the wake of that phase three interim trial data from modrna, jim one thing about some of the commentary this morning even before the moderna news jpmorgan the equity market is facing one of the best backdrops for sustained gains in years thats a lot of the street is seeing beyond this covid news. I think it is very, very interesting that most of the strategists are quite positive and to some degree, i dont blame them we have low inflation. We have the fed on the side of the bulls and weve got pretty good earnings and the stocks that are going down are just stocks that happen to be stocks that you buy when theres a pandemic and i think whats most interesting today and, david, youve got to see this this is really incredible. The bank stocks. The bank stocks could be the biggest winners at the open. That was last monday, too, remember they were up doubledigit percentages. By the end of the week, they had to give them back. Lets watch that. I see tremendous gains pnc, what is the reason . Not the bond market. What is the reason for that buy . M a. I dont think so. Carl, things going up because theyre in the indices and they go up. Its kind of circular reasoning, but its happening you have to have negative Research Like a piece we saw today from the evidence lab, i think, on apple not doing that well im not kidding. Every time i hear that evidence lab evidence lab. Okay. Well, what is the matter with that i love the evidence lab i always think of them stamping it put that into evidence right there. At least theyre different. I mean, Merrill Lynch has this like u. S. Route 66 uptown thing. Carl, i think the most important call this morning, believe it or not, is International Paper putting a second price hike through. Probably in the near future. Thats indicative of great growth of the old days so, if you have a second price hike but you still have lower inflation, what you end up is a situation where theres actual real growth. Not like the cmx recommendation that we saw today and then low and behold, tyson. Davi david, tyson tyson is up. Can you just kind of preserve that i dont know you know, just kind of scrapbook of tyson being up. Has that not been up much it has been down 30 for the year dont buy chicken and pork do you . No, apparently. Youre going to have trouble buying toilet paper and bounty paper towels, again. You just sound so negative. I do . I dont mean to. I just think that i gave you a good story about tyson foods tell me what happened with tyson. They had a quarter that wasnt horrendous. Come on. Give it up for tyson theyre like the giants, man theyre the best team in the nfc east sorry about that. Yeah i didnt need that. Anyway, carl, back to you. Its the way to stop him from talking. Just mention the eagles, carl. Arizona buffalo, that was fun. If youre looking for good football action, guys. Im thinking of moving. Hopkins hands, amazing. So, 36. 45 was the november 9th intraday high. We didnt quite get there. Of course, day is just getting started. But i guess it will be interesting to see how some of these overall levels track for the technicians. I think whats incredible here is that were beginning still one big nasdaq rollover and people are trying to buy the nasdaq not realizing that this is nasdaq down day. I mean, david, not just the robinhood people its other people. I dont know i mean, people who thought that moderna was going to fail. Nasdaq somebody is buying the nasdaq right now not realizing that last monday the nasdaq rolled over big whats the point youre questioning whether or not well see, you think well see the same pattern we did last week now, listen, somewhat muted. Last monday on the pfizer news was it monday, we were up double dingts in the banks. Right now jpmorgan up 3. 5 and bank of america up 2 and citi up 4. What happened at citi that theyre up four . Nothing nothing. Jane frasier is taking over at the end of the year. Carl, it is incredible to see these restaurant stocks go up with the idea that somehow because of moderna were going to go to olive garden six weeks ahead of when we thought what can i say good point, jim im looking at, for example, i think piper goes to 17. 45. Chipotle today and clearly that name not benefiting and citi first trip since february 25 you have to go back a way to see citi at 50 relative to the trend. 4 yield. Book value tangible book value higher and no buy back and cant raise dividend, david, as an exercise for people theyre at the mercy the stocks that dont have buy back from dividend tend to be, i mean, they cant raise tend to be left behind meanwhile, pnc people want growth yep pnc is probably going to be up 6 or 7 over the next few days because they got something from the bbva they are desperate for cash this is a brilliant move and only pnc could do it, carl because none of the other banks would pass muster. They are too big i regard this as a moment for everything other than the stay at homes yeah. Well, david, i have been waiting. We will talk to pnc next hour. Im waiting for you to bundle pnc, simon and home depot. Well get it done now on the pnc deal, we should mention. You both pointed out 11. 6 billion. The proceeds from the sale of lap rock and a huge number they brought in there, too. Done easily. Amazing what was allowed to be done without people allowed on trading floors those proceeds going towards what jim was just telling you about and carl was telling you 104 billion in assets headquartered in houston, texas, and provides commercial and Retail Banking sectors and 637 branches were talking texas, alabama, california, colorado, new mexico theyre talking about a coasttocoast franchise now you see pnc is responding positivi positi positively, not much as the seller carl mentioned lets get to the two deals. Jim, lets start with simon. Man, i spent a lot of time talking to the lawyers on both sides of this hearing the arguments to why, listen, the taubman side was thought and continued to have a very strong case, but the business had deteriorated a lot people wanted to draw connection to tiffany these guys had pandemic carved out, but their business has deteriorated a lot more than tiffanys and perhaps they didnt have the negotiating leverage you did have a couple other things that the simon side really felt that they at least had some chance with the judge not going to happen. You got the deal 43 from 52. 50 to 43, jim but, basically, same deal terms. They could close it as soon as before the end of the year it does need a new shareholder approval not unexpected in some ways, jim. But david simon did get a significant price reduction. Though theyre still taking on a lot of debt. Dont look at the price overall. Remember, theyre also taking on a lot of the debt here, as well. The debt that comes along with it, i should say but, look, this is a vaccine play federal realty up 5 they never cut their dividend. John wood fought and fought and i think that people want to be back in these stocks because happy days are here again or soon will be here again with a vaccine. So, there is just, david, people are nautot looking at the mall right now, but looking at it in the future the mall of the future will be more vacant than the mall for now. I dont know i listen to someone on brians show today saying if you lived in phoenix, you would be going to the mall twice a week just new york you dont go to the mall all the time. Carl, i dont know maybe the mall has in some parts of the country but the stores in there doing quite portly with the exception of lb and, by the way, some of the things that matt has been recommending tappe tappe t tapestry. A lot of great songs on that alb album. Really amazing. Takes us back to our youth. This is the Taubman Simon last of the big deals announced prepandemic that it will now close or at least appear to close on a renegotiation tiffany gave up a few bucks to lvmh and many shareholders certainly happy with it. A lot have been hedged, by the way. Dont forget its not nearly quite as big of a pay day but the downside was 15 bucks or lower for taubman had the deal fallen apart or the judge agreed to simons argument lets get to home depot, jim in 2000, i went back on june 19th, 2007, home depot announced that it was selling home depot supplies 10. 325 billion was the price to a number of private equity firms and they said at the time that i guess it was nordeli that built it up but had justcome in in 2007 and they said they began a Strategic Review in order to increase the companys effort on its core Retail Business after a thorough review of alternatives the board unanimously approved the supply 13 years later, theyre buying it back. Yet home depot is up. Home depots up again they sold it for 10, you know, sometimes Different Things associated with it i dont want to say its apples to apples. 10. 3 and buying it back for 8 or 56 bucks a share in cash and and they say now it will allow them, you know, to, well, to create significant benefits for customers and associates and shareholders given how intrinsic it is to the potential future for the company. I dont know well, i agree david, get used to this term mro. Maintenance, repair and operations and home depot is in maintenance, repair and hg supply is an actual. It was an actual and never understood the spinoff if only just because you want that business you want the maintenance and repair business if youre home depot. Lowes was rumored to be buying it and, obviously, the reaction to it is positive and, again, were in the open trade moment weve got open trade today and you can always tell open trade by looking at certain stocks that go down and they tend to be the stocks that we love, the zoom trades. The what trade . Zoom. Oh. Whats open trade . What do you mean thats the open meaning the economys open were open for business. Sorry okay, right. Docusign. Things that frankly are selling at an increedably higher multiples versus what they would be carl, you said something really important. You said that lower highs and lower highs is that chart of zoom thats lower highs people want out of zoom video, carl they want out of it in the worst way. Yep although i would applaud zoom for they are removing the 40minute free cap basically for thanksgiving so that families can talk to each other i think wednesday into friday. So, nice of them but youre right, jim. Although we should point out here before we get to pasani that the nasdaq managed to climb into the green with the dow and s p. Im prozoom. But, anyway, there you go. Look at those. Look at netflix up and, david, is netflix, is that what that is about you know, ive been watching that everyone, the whole country is watching. Are they . Were not quite through it should i give it away dont give it away. Please dont really. Who knew. Bobby fisher knew bobby fisher. Carm,l, i dont know. Its ridiculously positive market and i think a lot of it are these new buyers who actually have hope and theyre not corroded and not trying to figure out how to sell the news, carl they actually like the news and they buy on the news how different from the last 30 years. They like the news and they buy the news meantime, jim, ten year 90 basis points not quite as high as we got last week i think it was Morgan Stanley this morning said they see 145 by year end 2021 another multiyear record this morning. Well keep our eye on materials. How about the chinese with that very big growth in that deal which we havent talked about. The trade deal the trade deal that doesnt include us its unclear what the benefits will necessarily be but interesting to note the largest single trade deal that theyve been a part of no, it does not include us. Tiktok still alive. Yes what is the word from oracle, david . I havent heard a thing, have you . No. No one has i saw 60 minutes did a piece on it last night for those of us following it closely. Not really that much you didnt know interesting that they chose to show that prominently. But were still waiting on the tiktok deal in terms of news but the Commerce Department saying, okay, you can keep going for now. Look at the tenyear note. But you mentioned china, jim you know, regulation there has been very important. Were talking a lot about it, lately financial, obviously, the decision to put off the ipo. The baba last week and weve seen the comments, not just baba but jd and showing continued very strong Consumer Spending and growth for those companies there is concern overall about a monopoly regulation in china yeah. Look, are people too powerful . I dont know it does seem like if you look at the things like a jd, which had a really terrific quarter and the stocks getting slugged a lot of people told me to watch jd indicative of the market. It certainly is not. People wanted to be in the United States. I think, once again, you see an amazing, amazing carnival, norwegian. A place like norwegian what they can do, okay they can make sure that everyone is vaccinated. Right . I mean, there will be vaccines available. They can test everybody before they get on and im ready. Im ready. Carl, im ready. If thaths thats what they do. In february of last year because it is fantastic. The prices are amazing the deals on haven right now i feel like buying and then putting it on ebay thats how great they are. Haven being the section of norwegian that is at the top its fantastic i see up top of the actual ship . Yes got it. Ship. I didnt call it a boat, i called it a ship at least you did that carl, im guys, its pretty interesting market day we got the dow being led by boeing almost back to 200 First Time Since june lets get to bob pisani. Morning, bob morning, guys happy monday quite an advance 51 declining stocks s p over 3,600. Russell is essentially at a new high transports at a new high and you can see that big rotation that weve been talking about all last week. Still happening again today. Take a look at the sectors here. And the story is Pretty Simple three major moves here so, into value like banks and energy and out of growth Like Technology into cyclicals like industrial stocks that are outperforming and out of the fence of Consumer Staples and broadly into small caps over big caps those are the big three momentum trades that weve been seeing every since the vaccine came out. You look at things like the reits here Simon Property group, my heavens. Simon Property Group was 60 six trading sessions ago, seven trading sessions ago look at this, its 80 30 move in some of these big reits here same with the travel stock a lot of 30 movers in the last six or seven trading sessions. So, Carnival Cruise lines and 12 or 13. Six or seven trading sessions ago. 30 move in six or seven days. Same with the energy stocks. I talked last week about the refiners who are acting like all of a sudden the whole country is going to go on a holiday in the first or Second Quarter. Hollyfrontier another 30 move here thats 23 right now the opposites happening from work from home etsy is one of the poster childs of work from home and on the upside and down side 144, i guess six or seven trading sessions ago and now look at 123, 124 somewhere around there you can see the declines there 14 , 15 about even for facebook and netflix. Cl clorox down again today. Lets remind ourselves about the buckets of what moves the markets because a lot of positive stuff reopening story is the one negative out of four or five of them that is out there treatment of vaccine a big positive treatment and that is a positive for the markets here how about ultralow, low Interest Rates. Another positive weve got and then fiscal stimulus, well, its a possibility may be a lame duck stimulus package coming we dont know or not lets say that is a possible four out of five are generally positive in terms of what is driving the stock market, remember, ultimately, earnings are what matter earnings are growing particularly in the first and Second Quarter next year modestly for the Fourth Quarter. Dividends. Lets just call that recovering. I wouldnt say theyre rebounding, but recovering liquidity. Money to buy stocks out there. Thats a big factor. Thats high thanks to the federal reserve. You can thank them for that. One negative valuation is on the high side. Were trading at 21, 21. 5 times, 21 earnings. Thats high. If you look at the s p 500, the market is basically anticipating in 2021 we go back to record highs in earnings. 2019 the s p earned 163 were going to go down to 137 this year. And in 2021, hey, its back to 2019 in fact, were going to hit record highs the markets anticipating that new highs in earnings. The problem is, even at 168, thats pricy thats 21 times, 21. 5 times forward earnings at the prices we have got right now. The market is kind of saying it thinks the earnings are better than that. Could we do 170, 175, 180 . Who knows. We have been doing that in the Third Quarter. The numbers kept going up. Market is definitely anticipating that the earnings will be a little better than some people are anticipating now. Well see if that happens. For right now, i can tell you, in terms of the earnings, definitely anticipation of a big Party Beginning in the Second Quarter of 2021 because thats when the earnings really start to move to the upside. Carl, back to you. All right, bob, thanks. Talk to you in a bit bob pisani. When it comes to the vaccine, as jim said a moment ago, not just speed of development but speed of delivery did talk about how theyre going to deploy the relatively small s that they make this year take a listen. The reason were not able to make a big one right away this is the first commercial product. We need technologies for manufacturing. The good news fis well increas manufacturing capacity well engage with governments to see how we can do more work to get prepared it will be a Public Private partnership. First commercial product, jim. Thats whats make them different from j j or pfizer whats incredible with moderna, i remember when i interviewed them last year at this time, it was so novel nobody believed except the ceo because theres been no history of it. Now its been proven and congratulations to them. I was skeptical. I admit that when i saw pfizer go in on the technology it made me feel better the guys who hadnt convenient hurt are the guys who can develop gigantic amount of vaccine and doing it at the same time thats why i point out j j which is starting phase three in the uk they are ready then what happens how do we get it we hear over and over again a few drug stores. We dont know how it will be distributed. It wont be the way polio vaccines were distributed. Where you line up at your local high school. No plan like that. What do you think is the plan . Jim, i dont know what the plan is. I do know there are some questioning this transition period between President Trump and president elect biden and wondering whether we would be better served with a smooth transition because this plan is something thats got to be under way right now. And the question is youre saying theres going to be a transition yes i expect that there will be. I read the president s twitter file and this morning, in all caps that goes, again, to the friction here which is larger than weve ever seen really unlike anything weve seen in modern history, modern president ial history what the president continues to say and do but back to the vaccine distribution, does the Biden Administration have a plan that somehow is not going to be able to, be as easily executed because of lack of coordination with the Current Administration . I dont know the answer. I think the question has to go to them because probably right around january 20th is when youll start to see this thing ramp up. Yes heres something very interesting if you look what the market is thinking go to darden which i use, it is pretty much a generic restaurant what are they saying they have only a fraction of the tables open but the stock is back to where it was before the pandemic so i read that as saying that its competitors who dont have the Balance Sheet are going under, 20 and thats survival of the fittest because they didnt do anything other than cut number of people who they can serve so, yes, they have take out but not that efficient about it. Carl, that rally is indicative of the fact that there are far fewer restaurants for them to compete with and i think thats really incredible. Right when we know how when we know who the restaurants were that got culled from the population were not public companies. Thats for sure. Mcdonalds today and its franchisees will inspect all of it restaurant to make sure they are in compliance and what the company is calling covid fatigue according to an intern all note. Its the most difficult period of the pandemic. This is from the chief field officer. The note says socalled safety reaffirmation visits were developed with their franchisees and should be concluded by december 31. They may follow up where necessary, jim if mcdonalds which does scale better than anybody, really, if they are looking at this period as being treacherous this does say something. I think theres fatigue about this where youll see a lot of the illness comes from families where one of the family members is exposed and i think that when you look at mcdonalds of course you think the phrasing by chris whom you know well the ceo makes it took like what were they doing beforehand . Thats unfair. I do think that carl if halloween was bad, thanksgiving is going to be atrocious, but that its just its a train wreck. We know its going to happen what do we do . I dont know what youre going to do. Im going to barricade myself somewhere. Ive kept six feet from my daughter mask wearing would go a long way. You made this point. A lot of College Students returning home for thanksgiving, if not for a longer period of time, actually but they are coming home, potentially congregating with other friends coming home and then living at home. Thats an issue. Thanksgiving what will the workers do . What are the Health Care Workers going to do . Listen, thats great, thank you. A great concern as we watch case count as weve never seen before and hospitalizations at highs. Its a great concern you know a lot of Health Care Workers are strongly imploring people to wear masks, to social dance and do all those things that could keep the virus at bay. I dont know how well its working, particularly not that well a lot of states dont believe in the mandate until these vaccines come in to broader circulation carl, it does seem that thanksgiving is going to be the makeorbreak of course Christmas Holidays but it just seems like there are a lot of people who are resigned to it. Mcdonalds comments are indicative theres a group of people who say im going to get sick and i think thats not good because even though i know the death rate is, you could argue below the flu rate built the problem is the hospital rate because you have they people who are working night and day and what do they do . We just decided that they are like in army and its a battlefield . And you know what, thank you for serving on the battlefield i know, jim dr. Gottlieb has a good oped this morning talking about where supplemental hospital staff i mean it was one thing to send them to the northeast and california in march but in his words when the entire country is a hot zone you cant send them to the hot zone its too big yeah. Unfortunately, jim, as you know, we dont have anything really right now to prevent hospitalization. Theres not enough at this rate to prevent a change in the hospitalization rate to your point which is crowding out other patients who need to be treated for other illnesses. And so thats why our death rate or our deaths are so far above where they typically are 23,000 last year the flu. Carl, when did we talk about the military back like we did in new york yes there is a report out of texas that at least in el paso which has come up in a few times they have brought in inmates to assist with the body overflow in morgues. Lets hope thats an isolated situation there, jim but, yeah, hard to tell at this point especially given the concerns with the transition that you and david were just talking about. I just dont find look, i know President Trump is unlikely to want to leave the white house. It would be a fabulous time for him to be able to cheer on these people who are just going to i dont know how many of them are going to be able to make it through this period. Whether they will quit or come up with the illness. I just find that theres got to be people looking out for these people they people in hospitals thats why you you want to know a reason why you want to wear a mask. You dont want to inflict the number of people who are just working around the clock, the doctors and nurses what is it, did they sign on are they with 101st . The 82nd no. They are the heroes here, no doubt, carl. Good you mentioned it because i havent heard it anywhere else, dr. Gottlieb dr. Gottlieb is one as always. I dont know, carl jim, whats on mad tonight. Were done . Yeah. I was just getting started. Holy cow we got some great guests palo alto with a phenomenal quarter. Its one of those situations where its a sell. It would be up 20 if it wasnt for sell and corsair. Premier gaming Equipment Company even more than logitech. Can you believe these guests now im is going to gelt the fellow from tmobile you never lose. T the fellow from tmobile you never lose. Lets think about these nurses they didnt sign on for this how amazing are they im glad you said it. So true. Mad money 6 00 p. M. Eastern time good monday morning. Welcome to another hour of squawk on the street im Carl Quintanilla another monday of potential covid break through as moderna this time joins pfizer in releasing some good phase three data 94. 5 efficacy stocks rising on that news nearly 95 effective building the Investor Confidence following pfizers similar results last week. We can see at the bottom of our screen not that far from dow 30,000 and many sectors of the economy continue to face deepening covid headwinds. And a big and rare deal in bank space Pnc Financial services buying assets in more than a 11 billion deal ceo will union you later in this hour some sectors leading, banks up almost 2 energy up 3. 5 in terms of levels, session high was plus 416 at the open here for the dow. We need 454 for an all time high, david and we need 520 for dow 30 k so at least judging from the opening we got more work to do if well get there we do maybe a repeat more muted than last week in response to pfizers great news on vaccine which is 95 effectiveness versus 94. 5 effectiveness reported by moderna this morning, carl. As you point out banks which were up dramatically last week after the pfizer news are up again. You got these socalled reopening trades, disney is up 3. 5 although i would point out itself it is quite strong. They are benefiting there not just theme parks but overall the idea that people are going to return to going out and seeing thing. Comcast our Parent Company up again. Owner of theme parks were starting to see that same reaction but we should point out by the end of last week we started to see return to growth from value and many names that benefitted from the phasers news started to sell off as well as the week went on we know the stock market is a future indicate orand given these vaccines wont be widely available for several months, yes they are rallying on the news, or the expectation of this news, but theres some disside the n krr irch srch srcc dissidence too many localities are cracking down on business closures and rolling back some reopenings. Even as we talk about this incredible vaccine news the headlines on the virus front continue to be more and more dim going into the winter, carl. Yeah. We added a million cases in the past six days in this country. Meg terrell brought us the ceo of moderna earlier this morning and we learned a lot about the Science Behind the development, the distribution and safety. Lets get to meg once again. Reporter as these cases start to accurate that drove getting more data for this trial and will potentially accurate the data in other vaccine trials going on right now from j j and astrazeneca. A horrible situation heading in to the winter with the pandemic but we should get data sooner from these companies on the moderna news, 94. 5 efficacy in phase three trial. Amazing result that then follows the pfizer news from 90 efficacy last week now they said 95 people in the trial got covid19 90 of those people were not vaccinated on the placebo arm. Really importantly they saw 11 severe cases in the trial and all of them were on placebo suggesting this vaccine really protect not just against any disease but severe disease as well which could make a huge impact on the pandemic company said no significant safety issues although after the second dose there are some things like fatigue and muscle pain supply is a huge issue if they get the green light they will have 20 million doses in u. S. Globally 500 million to a billion dose next year we talked with the ceo about that supply. Heres what he said. I think with the data that we presented this morning, just hope that we should be able to get those vaccines soon into the marketplace to vaccinate people at highrisk to stop the pandemic reporter guys, questions do remain about this vaccine and pfizers as well one is does it just present disease which is tremendously important from a Public Health standpoint or does it prevent infection completely which would really just stop transmission in its track. We dont know how long these vaccines are protective. Those are answers we should get in the future as they further of analyze the data they will seek fda approval. Both seeking for emergency use authorization. Fda will hold a meeting of outside advisors to discuss both of these vaccines. The fda will then make a decision if they are cleared for market a cdc Advisory Group will weigh in on the prioritization of the vaccines and were getting more news this morning in laying out the tempo of guesting these vaccines to market from pfizer and moderna together, enough for 20 Million People by the end of january secretary azar said all seniors and First Responders should be able to get a vaccine and then starting really april, may, june, july dr. Anthony fauci says the general population should be able to get access and he hopes of course well have other vaccines contributing to that supply as well guys, back over to you meg, i have a question about production you laid out the numbers pretty clearly for this Moderna Vaccine and pfizer they are partnered with the government in different ways pfizer a 215 billion company. Moderna is a 35 billion company. How are these companies able to produce . Reporter such a great question david and goliath story even though moderna is getting big. Its not a david any more. They have partnered with a manufacturing partner to help them increase their supply but this is their first commercial vaccine. They had to build up that manufacturing class and make these partnerships this year while they were working on the vaccine. Pfizer on the other hand has vaccines on the market but this is its first mr and a product so ate different manufacturing process to get this vaccine out. But both companies talking now about trying to increase manufacturing even beyond target because these vaccines work so well wants to get them out to as many people as soon as possible. Another time well talk about the implications for vaccines at large down the road for years to come given the mr and a model. Well talking to you soon. Stocks are up on all of this news lets bring in Sally Mccartney and mr. Ramos. Good morning, guys good to see you. Hello it is a good morning it is a good morning. You point out that managers would rather buy a dip than chase a rally. Is that another way of saying you think the caseload data before vaccines are widely available is going to bring such a dip . I dont know that the caseload will bring the dip. You have this funny thing going on and youve been talking about it all morning you have sort of three segments of the population that are general buyers and investors in this market. Old Retail Investor which is sort of predictable. New Retail Investor which is not. And then the Institutional Investor institutions have goodyear and they dont want to take a lot of volatility even with the good news were seeing, so our sense is that theres still a lot of under investment theres an ability and we do see volatility in next few weeks but we have the perfect backdrop we have promise of a vaccine we have an election outcome that actually and the gridlock is better than anybody was expecting. And we have this rotation driven by eps revisions up. So long term bullishness, short term volatility is where we are. Are you seeing any problem with that narrative . No. As a matter of fact i dont, because i call it vaccine mondays now because two mondays in a row we get vaccine news and it drives the cyclicals forward. If you look at the economy were poised for strong growth in 2021 and relative to 2020 and also especially important Earnings Growth in s p 500 is expected to be quite a consensus, estimates about 30 , to 21 after having dipped in 2020 now we can see to the end of covid pandemic because of the presence of a vaccine allows the market to just focus on that outcome at the end of 2021 and disregard the bad news around the short term which is really bad in terms of who it impacts but for the market it allows the vaccines to go through and until the end of this event. We think the conditions are good for value stocks in particular to outperform Growth Stocks given the fact were seeing this to the end now but ally, if market are already pricing in what they expect will happen by the end of 2021, how much of this front loading and what will happen when we get to next year and some of these developments that weve been talking about for so long start happening will the market sell off then . Thats a great question theres still some tax policy and how that affects investors we dont anticipate, you know, our normal scenario now anticipates, you know, georgia staying where it is. And so basically having gridlock which tends to be really good for markets and takes a lot of the very both leftist and righthand things off the table. So a lot of the tail risks we think about half of the upside in s p because of a vaccine is priced in we think theres probably another 2. 5 to come whether that gets pulled forward into this year or next year is a question and look with the vaccine for today the one thing i havent heard that excites me the most is that this vaccine as opposed to the Pfizer Vaccine seems to be much less fussy, much more easy to distribute the number that we heard this morning was that it can stay 30 days effective in a normal refrigerator so those kinds of things, all the issues were talking about in transferability, distribution, i think theres still upside there, and there is upside in terms of all of the things that weve just been talking about this morning and so as you see other institutions making their s p targets up, we even heard talk from our Investment Bank about, you know, up to Something Like 4100, given that things seem to be lining up well but, again, i think theres going to be not a straight up path given where we are currently and he some of the arrivings that remain. Clearly you dont think a lot of damage will to be done in the next two months from the economy with rising covid cases and no real treatment available until we get the vaccine now and a lot of businesses conceivably, small and medium size not publicly traded and not getting any aid from the government youre not seeing that hurting growth longer term . I think youve actually in your question laid out the most important point which is were looking so forward now we know that we are headed into personally markets professionally a long dark winter were not in a good place. There will be economic damage. Biden came out this morning and saying there will be no masks countrywide shutdown so i do think the theres going to be damage i dont know its going to be priced into the market i do think that the 2 trillion we thought we might see in fiscal we now think is probably 500 to a trillion. And that might disappoint markets for sure yeah, even as were talking guys fauci is on a press call saying the so called general population without underlying conditions will start to get a vaccine beginning in april so your point about winter, ali, is good one. Thank you very much. Good to see you both thank you coming up, Pnc Financial surfaces buying u. S. Asset of spains bbva William Demchak will join us on e hesi of this break stay tuned [narrator] at Southern New Hampshire university, were committed to making college more accessible by making it more affordable, thats why were keeping our tuition the same through the year 2021. I knew snhu was the place for me when i saw how affordable it was. I ran to my husband with my computer and i said, look, we can do this. [narrator] take advantage of some of the lowest online tuition rates in the nation. Find your degree at snhu. Edu. See yourself. Welcome back to the mirror. And know youre not alone because this. Come on jessie one more. Is the reflection of an Unstoppable Community in the mirror. You can go your own way 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. One of the deals of the morning, pnc ft. Myers services buying bbva. Sharon eisen joins us with a special guest this morning reporter good morning. Im pleased to welcome bill demchak for a cnbc exclusive bill, great to have you back on. Thanks for having me, sara. Reporter so, obviously, a huge deal. You have created and will become under this deal fifth largest u. S. Retail bank a lot of the analysts understand why bbva usa presence they like the exposure but wondering why now . Help us under that, bill well, i mean look since the last time i was on your show weve been pretty clear about taking the nonstrategic asset which was blackrock, a great company, but deploying those proceeds into a franchise that would give us growth for years to come. And thats what eve done bbva has been at the top of our hit list for the last five years as we look at the markets they operate in, and the complimentary nature of those markets to what we do. You know, the line now, you know, look at some of the news this morning, but basically when i was last on your show, if you remember, we didnt know if the mortality rate from covid would be 1 or 10 it was a different period of time and i think particularly with the news of the vaccines, we now have sort of a down side risk to find in terms of what will happen to the economy we see an end to this. We see, because of the low Interest Rates, a need for scale, to be able to grow our franchise. It worked out. Its a great deal. It puts us in a great market it will give us a Growth Opportunity for the next 15 years. Yeah, i was going to ask you. You mentioned already but to what extent news like today, good news on the vaccines play a role into helping you see through to the other side, especially, though, because when you sold the blackrock take there were broader questions on what you saw coming down the road in terms of Bank Credit Quality and just what the picture and outlook looked like and if it was worse than maybe the market was expecting a lot has changed. A lot has changed as i said, we really didnt know a lot other than we were in for a tough period of time when we sold blackrock since then weve seen assets appreciate across the board weve seen massive fiscal and monetary stimulus and good news on medical progress on covid both on treatments to the extent you get it and now with vaccines coming hopefully in spring and so that takes the tail risk out of a transaction like this and allows us, you know, instead of focusing on surviving the moment, which was in some ways our fear in the spring, and how do we the turn this dislocation into a Growth Opportunity, a long term Growth Opportunity for pnc and thats what weve done there are questions, though, because as you mentioned assets have risen one is blackrock itself since you told it. The stock has rally almost 50 there are some questions on growth for you about why this is a better at any rate yeah. So life isnt a game of perfect. At the end of the day we taken an asset that was nonstrategic to us. And monetized it and effectively for the same financial metrics, given ourselves we broke platform for 15 years. From book value to earnings basis to capital postdeal close, all of that stuff is the same or better and we now own a franchise that we can add substantially to through revenues that will be coming in the outyears and something we control and good at. Weve done with National City and rbc or rbc usa were confident that we can take what they have in the Growth Market they are in today and bring our products and services and go to Market Strategy and grow that franchise substantially. What about the valuation youre paying 1. 3 times tangible book value which is i think where your own stock is trading. You called a cyclical low. Those book values were cut in half at one point during this covid crisis they were you know, at the same time we were, you know, everybody was worrying about, you know, what the outcome ultimately was going to be with the economy with covid. And we have degree of certainty on that. And so bank prices have largely gone up because you have taken the credit tail risk off you know, i go back to the statement, you know, life isnt a game of perfect, but, you know, ultimately if you just look at the end result here we end up in a really good place for our company. You knows in a place that i think is increasingly important as you look at this environment for banks, sfliegt were in a low rate period, low Interest Rate period, were in a period of time where technology is ever more important and scale matters. And we just gave ourselves, you know, a platform for growth, again, for years to come which not with standing what a great asset blackrock was, it didnt go that great for us. It was an ownership stake but didnt give us any strategic advantage. Following up on that. Youre offsetting what was 20 especially from pncs aenks from the sale of blackrock they took 20 is what youre talking about meerp could it be even snoornt youre talking about leveraging costs, additional products, maybe booing additional assets to roll in here. What can we expect you to dmeet if not dmeetd number youve given us our number is taking costs out of the equation, derisking their Balance Sheet a little bit and it doesnt count any revenue synergy. Thats a number all the analysts want but it completely ignores the revenue synergy and growth that well get over time. We look at our Treasury Management product penetration is an example is over 85 of the corporation clients. Its under 40 for the bbva clients. So thats sitting there for us to take. When we look what we did with the rbc markets we grew those markets to be over 50 fees over the course of five to six years from low teens and bbva is in same place massive opportunity. You know, thats always going to come and we have to prove it the upfront metrics were showing you guys is the simple execution through the close. Bill, just on a the strategic question here, weve talked we joke sometimes on closing bell about the banks. How Bank Branches are going away and shrinking. What are your telling investors who are wondering on a bigger bet on that when pay pell and square are going up every single day in terms of market value its a bet on markets not necessarily on branches, right we want to have what bbva brings us through conversion well have brand equity and size that allows us to present the totality of our company. Youll dont see Branch Networks shrink by the way youve seen pnc on our Legacy Networks to be most aggressive so i think that happens over time bbv as network in these markets is actually, you know, we would define as a thin market to begin with not with standing their share in texas is probably the one exception. I think that trend continue. Were set up to excel and given our technology back bone and our Digital Products but, you know, thats something that takes course over the next five, ten years, not something that happens tomorrow. What is your tech play, bill, as southeast bigger banks now ashowed of you on assets have invested big time on their tech spending and weve seen this accelerated shift during covid how does this deal today help you . We spent the better part of the last five or six years he rebuilding our entire tech back bone new cloud base data centers, now applications that are all effectively running in cloud automated controls and so on and so forth what were able to do with this came deal is effectively bring over the entirety of their franchise, the data, clients, and Everything Else and pour it into our systems without large incremental costs. Were not taking their legacy data centers, they are staying with bbva. That whole line item on their expense statement disappears now were taking the technology we invested in, and bringing it to scale right . We can apply it across to more clients of true time and we can also support, you know, just a larger business. Really quickly you expect the Biden Administration to approve this you think on a regulatory front it will work out what are your expecting from biden on this whole issue of Bank Regulation and allowing consolidations and possibly allowing you to buy back stock again. Theres a lot embedded in there. Not with standing well be a coast to coast retail bank were still one fifth the size of the mega banks and i think theres a real need in this country for competition with the mega banks on the Retail Banking side were a main street bank were not a systemic risk. Were embedded in our community and here to serve our community. So i would hope that, you know, well get approval, you know, i believe well get approval from the fed and occ. I hope as well the political backdrop to this whole thing is actually a positive one. Share repurchase and so forth we submitted our second round stress test as it relates to covid and were going to wait and see the feds reaction to that thank you so much for joining us on the back of this deal. Your stock up almost 3 . Of course bbva is up we appreciate it thanks guys sara thank you for bringing that to us lets get our etf spotlight. The ticker is xlp. Its up for the year walmart announcing its selling its majority staying japanese Supermarket Chain to an investment firm. Rakuten purchase is moreha tn a billion dollars. Squawk on the street coming right back any idea how much it will cost . [doctor] i recommend goodrx. You get free coupons to save on your prescriptions. Goodrx, smart. [announcer] stop paying too much for your prescriptions. Thanks. Download the free app today. Welcome back heres your cnbc news update at this hour. The Trump Campaign has pulled a key claim from its challenge to the pennsylvania election results. The lawsuit no longer says that nearly 700,000 absentee ballots should be disqualified the suit however still claims that pennsylvanias vote tally should not be certified. Inches of rain cutting power to 400,000 customers from michigan to connecticut. Look at this video near erie pennsylvania overseas now political crisis in peru after the president resigned and the congress recessed without naming a successor. Last week legislators requested the elected president and replace him with the head of the congress who then stepped down on sunday. And take a look at this. This is no ordinary pigeon this is a belgian racing pigeon that sold for 1. 9 million at auction. Pigeon auctions are a real thing. Youre now up to date and thats the cnbc news update at this hour. Carl, who knew that pigeon racing was on the decline. Ill go halvesies with you. Markets hanging up there dow up 400 airlines obviously benefiting the from the Moderna Vaccine data today although with the exception of alaska not quite taking out their highs. Their multimonth highs from last week. Dont go anywhere. In your customized view of the market. Its smarter Trading Technology for smarter trading decisions. Fidelity. Keeping your oysters busihas you swamped. You need to hire. I need indeed indeed you do. The moment you sponsor a job on indeed you get a shortlist of quality candidates from a resume data base claim your seventyfivedollar credit when you post your first job at indeed. Com promo covid cases dont climb as hospitals across the country approach capacity. Michigan and Washington State the latest to reinstate restrictions on gatherings over the weekend and halting indoor Restaurant Service among other activities joining us now is the ceo of Henry Ford Health system in detroit where his network of hospitals are seeing over 128 increase in admissions its good to see you first talk about your capacity, where it is in the hospital, and your access to resources like quality staff and protective gear thanks very much for having me i would tell you that, you know, since that statue quoted were now at 150 in last 15 days in terms of patient volume for covid. We now have just over 320 patients across our hospitals. Thats about 10 of the population across the entire state of michigan. Our concern is this. While that volume is spread across five hospitals in southeast and central michigan, the rates are continuing to increase our Emergency Departments are becoming more and more full on a daytoday basis with patients waiting and those needing to be admitted for covid we have one hospital that has more than 50 of its roll thats now covid related. One of the big concerns as you mentioned is staffing. So clearly michigan has been hit with the covid pandemic since march and so we have a significant number of staff who have been working pretty hard for the last eight months. We tell you were seeing shortages in Critical Care nurse, were seeing shortages in some of our support staff like Environmental Service workers. So it is becoming very concerning for us. The last point i would make to you is that generally speaking were seeing more and more of our staff that are getting Community Spread from covid, and would tell you that as we began this process we had about a 3 Positivity Rate with our employee staff since friday the number of staff weve tested, our Positivity Rate has gone up 20 both with the employees that weve tested wasnt our overall population Positivity Rate within our lab so were very concerned about spread across all of our communities. At than incredibly alarming statistic and it brings me to my next question which is as we cover the expectation of this vaccine and the fact that front line workers will be among the first to be vaccinated by the end of this he year, are you queueing up to get that vaccine, one of these vaccines for your workers and what are your being told about its availability . Well its still not a lot of clarity yet on available we certainly are making preparations we are an organization because we have a lot of Research Going on in our Health Care System we have a freezer capability to store the vaccines that need the storing at 80 below story celsius, so were preparing for that were working very diligently with our state Public Health officials in terms of distribution and so we will be prepared as soon as theirs clarity at the state level regarding how many doses of vaccine will be available for the state of michigan. Our chief medical officer is meeting with the state on a regular basis to get information around our preparations. Well be prepared for the vaccine as soon as its available. When it comes to supplemental staff coming to you from other part of the country, we asked some Health Care Ceos in wisconsin last week about that and their response was that they are not expecting anything they said were on our own whats your view on where you would get help if you could get help so were really concerned about that issue you know back in march when we had challenges we were able to, to get staff from ohio, staff from california, and so we felt that we were in pretty good shape with back up staffing. At this point in time its very, very challenging the agencies that provide supplemental staffing are strained and as you might imagine in a supply and demand economy the rates for that continue to increase i would tell you that we have relationships with two organizations in different parts of the country the three of us have agreed to share staff if one of us gets into challenges and so im hopeful that if we are in need for that well rely on our partnerships with organizations in new york area and organizations out in the Mountain West topotentially provide support for us and we would do the same thing if they were to get in trouble my question would then be how far are you from getting into trouble so to speak. How much space do you have then between now and then well, the data in michigan would suggest that hospitalizations could double over the next three to four weeks. If that were to be the case we would clearly be in a scenario where we would need supplemental staff and be reaching out to colleagues, to our agencies that staff us on a regular basis but also to colleagues in other parts of the country so our Human Resources team are actively working on plans to provide supplemental staffing should that be a need. Just one final question which is, obviously, michigan has become a bit of a political lightning rod nationally for governor whitmers restrictions on businesses, but what do you know about where Community Spread is happening and is it your belief that dialing back all of this indoor activity will actually tamp it down . I will tell you i have been and continue to be supportive of the efforts weve and the at the state level to tamp down the spread of the covid virus so its my belief that if were able to reduce indoor gatherings, social gathering, reduce the amount of humanity that spends time together and were able to increase sensitivity to michiganders to wearing masks, im very, very hopeful that we will see the spread of this disease go down if you look across other countries, certainly in eu, when you see steps that have been taken in a broad level to reduce the amount of humans that are together, you see a drop in rates. Weve seen that in france, weve seen it in italy, and so its my belief and we saw that in michigan frankly earlier in year its my belief the kind of steps that our State Government is taking are prudent the steps to help us both reduce the spread while balancing Economic Conditions well well certainly borrow some of that hope and wish you the best david, as we talked about cognitive dissidence earlier the dow is hitting new highs it could be a rough period for a number of weeks. Before the braereak lets look cruise lines people looking past the moment and looking ahead to future. Travel and leisure continue to send fri aall on vaccine hopes were back in two minutes. 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 . 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 mini on us. Welcome back to squawk on the street. Markets are in rally mode after that positive vaccine news and no you dont have the deja vu. Were at session highs right now but the years biggest laggards, financials and energy among the biggest leaders yet again. Today on those recovery hopes. Big oil and gas names like diamond back energy, october ocl petroleum are higher guys, keep an eye on those particular crude prices and they continue outperformance in energy that we saw last week a lot of green on the screen so far. Far and away the biggest gainer in terms of sector back over to you guys. Thank you very much after the break consumers make another rush on some basic household items. How are groceries adjusting to avoid shortages like we saw in march. Well talk to the ceo of a Major Grocery chain in a moment as the dow needs about 30 points for a fresh all time high. Dont go away. As Coronavirus Infections continue to surge, some retailers are strengthening covid19 precautions walmart resumed monitoring and counting customer whos enter the stores and the major grosseriers have reinstated purchase limits on some essential items. Joining us now, the president and ceo of giant food stores nicholas, what are you limiting people from purchasing right now and why . Yeah. Good morning we have a bit more muscle memory this time around as we did in march when it was all kind of new. And because of that, we have put very small limits, actually just the paper category right now we saw a little bit of an uptick in our e commerce transactions which informed what we were going to do in stores. We put that across the platform just for that category similar limits to what we did in march. We havent done that in any other categories thus far. There is a good supply in most of them. You are seeing a pickup significantly in demand right now . Again, based on previous trends when we were peaking are you expecting that to continue we are seeing a peak. But a pickup but it is also thanksgiving. People are getting ready to celebrate the holiday, maybe smaller gatherings youre seeing migration into categories we typically this have time of year, the more premium items. So not to the level of march or april, but definitely increase right now. Nicholas, back in the spring we saw dislocation in meats because the processing plants had widespread outbreaks which they got under control they have dashboards to monitor the workforce. But since they got it under control, are you seeing dislocation in other areas where maybe the supply chain could go awry commodities are strong. You gave a great example of the meat industry. The u. S. Supply chain is strong. Were seeing evidence of that right now. I think certainly in our stores but also in competitors you see more product vablavailability nw i dont see any cause for concern. I think that good smart purchasing behaviors make sense. In the spring we saw Grocery Stores correspond quickly with new measures like limited hours so they could restock. Mask requirements, one way aisles has all that work been baked in . Do you see a new development in the what i that consumers experience Grocery Shopping if things were to get worse the only thing you didnt mention is the migration to ecommerce delivery to homes or pickup at our curb side pickup that continues to grow quickly we see customers think more about that during the winter months things in store that, is muscle memory those are things our employees we have not taken any of the measures off right now one way aisles are not necessary. If you look at the spacing and hours, vulnerable population hours, those things stayed in place and will continue. When what about the workers are you seeing increase in infection rates among your workforce . Thanks for asking thats been my top priority and of that my team. We have great ppe supply and great processes, doing a lot of Different Things to make sure they stay safe during this time as well. Were doing everything we can on that as well very, very thankful for the protection that our teammates have experienced. Thank you very much for joining us as well thank you all right, lets get to mike santoli. He has vaccine news and investors back in the markets, mike what are you seeing behind t scenes the big question is whether investors are correct in looking through this difficult period were in right now the market is in this mode of willing to focus on the future and the anticipation of the very much known uncertainties you have to respect the markets ability to think to try to dus count th discount that future the question is whether that process is built into the market were 2 1 2 months into the period when the big nasdaq Growth Stocks, stay at home stocks peaked and reopening cyclical trade is working better that involves mall caps and large caps last week, of course, huge burst of fund flows into equity funds as well as a big uptick in optimism so all that leads to the question whether were in for a period where we have to chop around and deal with a rotational type market as opposeded to one where the year end momentum is flying i dont want to say that late comers are necessarily pulling in some kind of a top to the market but it is worth remembering, youre up 11 in november alone. The average Fourth Quarter gaughan is like 5 so if you think that its a strong seasonal period, it is. Credit markets are strong. Its been a broad rally. All those things are good. It is how much of that is recognized in front in a market which a few months also overanticipated a reopening pace you have to keep that in mind as well from june and july. Mike, you tweet about your mystery broker short term tap perhaps but long term, Small Cap Value trade lasts for sounds like years. Right the call there is that it is a real long term title shift its no the just about, you know, a catchup move right here. Of course, not endorsing it. That is the big question right now. It really is about whether or not youre going to have a moment in the sun for the small caps, cyclicals and value stocks or if this is going to be a big shift where the large nasdaq stocks are so big piece of the market that they got to be expensive and maybe have to, you know, have to basically be on the sidelines nfor a while. Very much unclear. One of the Big Questions is there is not an unlimited upside to the valuations of cyclical and value stocks the way there is on the secondary Growth Stocks where you can decide something is worth 35 times earnings, not 30 times it seems like there is more valuation there. Therefore, the economy better be really strong to be feeding that Earnings Growth as opposed to just that multiple expansion working. Yeah. What is fascinating, well find out at the end of the decade how it turned out. Fascinating though, mike an, ketuff thksmi san toll yetoli dont go awa sometimes, you want speedy but reliable. Stateoftheart but dependable. 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