Transcripts For CNBC Worldwide 20240703

Security. We will stick with washington. Jim jordan preparing for round three of the speaker vote today. And the bottom may be in for the second largest economy in the world. Chu China Central bank takes new action to shore up the market there. It is friday, october 20th, 2023. You are watching Worldwide Exchange here on cnbc. Good morning. Welcome to Worldwide Exchange. Im frank holland. Lets start the day as we kickoff the hour with the check of the stock futures. Right now, lower across the board. Dow opening up 30 points lower. Nasdaq taking a leg lower. S p is flat. This after a rough session for the averages which saw the dow, s p and nasdaq close nearly 1 lower. The dow transports and russell coming off sharp declines. They are on pace to extend the multiweek losing streak. The dow down over 1 . The russell is hard hit down 1. 5 . Fed shchairman jay powell is making a case there is likely more work to do. We have models for everything. We have formulas for everything. As a pra practitioner, we have see what the economy is telling us. Check out the action with the s p 500 yesterday. During the course of the Powell Comments which kicked off at 12 00 p. M. , the market was moving sideways at 12 00. During the speech, it spiked. There were climate protesters that delayed the speech. You see a spike here. Later on, you see the dip to the down side. This is later when powell struck a hawkish tone. You see the markets moving lower throughout the day. Powells comments juiced the bond market with the tenyear yield briefly topping 5 for the First Time Since 2007. Look here on this side of the screen at the bottom. We have a graphic here. We will continue to watch the tenyear. You see it touched 5 briefly yesterday. Back below 5 now. Follow along all morning long. We will keep it up on the bottom of the screen all morning long. We will check the Energy Market with wti which is back above 90 a barrel. Brent crude at 94 a barrel. Up 1. 5 . Natural gas is unchanged. Lets dig into this with ryan detrick at the carson group. Ryan, it is good to have you h here. Good morning, frank. Thanks for having me back. What wdid you make of jay powells comments . It say tale of two halves. The whole statement from the fed. T we are fully aware. They asked are things tight. He said maybe it is not tight enough. Running counter to the prepared remarks. It is what it is. We saw the reaction of yields like you showed. The good news is we are beneath 5 now. Im aware that can changes quickly. You look at october. It can be rough. Usually the second half is where things get better. One final comment on this. Initial claims under 200,000. The economy has been so strong. We are still in the camp, frank. We think the fed is likely done. I know the reaction in yields. The prepared remarks were in line with what the other fed members were saying. Higher yields have done the feds work. I want to play a clip here of jay powell. The bond market has risen previously across 5 . I want to get the take on bond yields on the impact of the overall economy. The whole idea of tightening policy is to effect financial conditions and to the extent higher bond rates reflect they do. They are producing tighter financial conditions right now. That is how Monetary Policy works. That is literally how it works. In principle, as long as bond rates are going up for some reasons and not going up just because they expect us to do things so if we dont do them, they come back down. They dont think that is the case. I dont think that is the case. How did you read those remarks by jay powell . I was doing the Halftime Report yesterday and they said that was mudmuddled. I was thinking the same thing when i saw it and listening to it there again. That is the feds job. Talk to confuse us. He is talking at the same time. Higher for longer is here. The fed fund futures are saying and we have been in that camp for a while. We said all year there would be no cuts this year. We dont think they will hike. It is a mixed bag. Frank, higher yields are not a shock with the economy strengthening. 5 is a psychological level. We could near a peak in yields here which would not be abnormal with the over the top sentiment here. People are pessimistic on bonds as well. We have seen a worse selloff in history for stocks. Ryan, now we know where powell stands. We have some sense of direction where the fed want to government where are you seeing opportunities . We like the sicklycyclicals,. Energy has been the leader. We all know that. Industrials. We are more neutral on financials. If there is anything encouraging for the bulls, we have strength from the large companies. The other one that i know people dont like are small caps. We have a small overweight to small caps. If we think we are getting to the peak in yields with the fed likely done hiking and with the economy on firm footing, the small caps look good. One final comment, you look at forward pe multiples. Small caps are cheaper to large. That is an area we like. Small caps and sicyclicals sdpcyclicals. We are watching the tenyear bond all morning long. Thank you. Ryan detrick, thank you. Thank you, frank. Turning to washington and President Biden making a primetime Oval Office Address. Biden making his case to the American People that the u. S. Needs to support ukraine and israel as the war with hamas continues. Alice barr joins us now. Reporter good morning, frank. President biden insisted that American Leadership holds the world together in the second Oval Office Address of the presidency underscoring the gravity of the message he wanted to deliver to the American People. As war rages in the nortmiddle and ukraine, President Biden states the conflicts directly affect Americas National security. When terrorists dont pay a price for their terror and dictators dont pay a price for the aggression, they cause more chaos and death. Reporter the president expected to make a pitch to Congress Today for 100 billion in aid. 60 billion to ukraine. The rest for israel, taiwan and addressing the migrant influx at the southern border. Amid concerns, americans are growing weary of sending tax dollars overseas. President biden framing the support for allies as . The smart investment to pay dividends for American Security for generations. Reporter he also announced 100 million in humanitarian aid for gaza and the west bank. Drawing a sharp line with hamas territories and civilians. There is food, water and medicine crossing from egypt into gaza as soon as today. We want to see the trucks cross and the numbers i have seen mentioned are not going to be nearly enough. Reporter a growing humcrisi and seeking to root out hamas after the terror attack. As u. S. Officials hope to contain escalating tensions in a region on edge. President biden also called on all americans to reject hate and den denounce antisemitic rhetoric. He stated partisan politics cannot get in the way of americas responsibilities and the need on capitol hill to get the act together to be ready to supply more of the aid. Frank. Alice, this is a rare primetime Oval Office Address for the president. He touched on the hospital bombing in gaza. What was his message there . Reporter this is the most declarative so far saying israel was not responsible for the blast. We have seen terrible images and reports coming out of there. He also made clear that he is going to hold israel to account to ensure it follows the rules of war and that it allows that humanitarian aid to get in to civilians in gaza. Alice barr, thank you. We have more to come here n Worldwide Exchange, including the one word investors need to know and the debate over the beige book and if now is the time to buy the dip. And why shares of solar edge are sinking ahead of the open. Later, back to d. C. And the race for speaker. Why jim jordan says ihes not be backing down. 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Its always something with you, man. Great solid greek salad . Exactly dont delay the game with verizon or tmobile 5g Home Internet. Catch it on the xfinity 10g network. Welcome back to Worldwide Exchange. Looking at the futures and the dow would open up 45 points lower. Lets see how europe is shaping up as its day is getting under way. We have Joumanna Bercetche with more on the early action in the london newsroom. Good morning, frank. It is a riskoffs session. Broad based losses in europe. Stoxx 600 down. 70 . Its fourth day of losses. Sitting at a seven month low. Ftse 100 in the uk down. 50 . Weak macro data coming in today. Consumer confidence lowest level since july. Even the swiss, the relative defensive index, down. 40 coming off the worst day of the year yesterday. Let me switch over and tell you what is happening with the yields. Obviously a big for news the u. S. , but in europe. The tenyear bund at 2. 93 . We are lower in yield terms. One basis point lower. For the week as a whole, up 18 points. This is the sharpest rise in yield terms since july. Big moves over there. Tenyear gilt at 4. 69. 30year gilt at the highest cost since 1998, frank. The upward movement in yields is impacting the markets all over the world. A lot of focus on the tenyear italy. The spread between italy and germany is firmly above 200 basis points. It is a cause of concern which spells trouble for the periphery funding costs for italy. We are watching for s p global reviewing the rating for italy sovereign debt. It is not expected to change negatively, but it could be a catalyst for Bond Investors in the market. Joumanna, thank you. We are watching the bond yields in the u. S. Here. There is a ticker on the bottom of the screen. 4. 94 . Joumanna bercetche live in our london newsroom. We will stick with the overseas action. China leaving the benchmark oneyear prime rate as the same to bolster growth. This is one of several measures by the central bank of china to ease concerns of the liquidity cr crunch. This weeks, china reported ber gdp and retail sales. Lets talk more about this with chief operating officer at the china beige book office. Great to have you here in studio. Give us a sense of the bottom with the chinese economy. Frank, one of the things we have been saying is the chinese economy is performing much better than markets think. The q3 gdp number was no surprise to us. We saw in the data there has been improvement in the Second Quarter over the First Quarter and similarly in the Third Quarter over the Second Quarter. Outside of the crisis in property, which is serious, you are seeing other parts of the economy performing much better than what is believed. I believe the Chinese Consumers are slow to spend. They were worried about the china lockdown measures. They have been holding on to their money. The retail sales number is a start of the trend Going Forward . Will Chinese Consumers spend more . Some is base effects compared to this time last year. Putting that aside, what we have seen is a Chinese Consumer is willing to spend in travel and dining out. Leisure. That sort of thing. They are not willing to spend on luxuries or cars. Keep in mind, china has never reliably seen its economy recover because of consumption. I dont think this time will be any different. Very different on the u. S. We are dependent on the consumer here. Morgan stanley is against buying the dip. They are struggling to prop up the property sector. Do you agree with the take from Morgan Stanley . We have been saying markets havebeen bearish scyclically. We are not looking at the chinese economy. That means the entire portfolio needs to be shaken up and investors need to price that in. Speaking of keeping things in perspective, you come here and give us the sense of the oil perspective related to china. We hear slow demand in china when it comes to oil. What is the picture . Wti is back above 90 a barrel. Brent crude at 93 93. 50. That is on the tension in the middle east pooboosting oil pri. How does china play this . What we have seen is china has bought up oil early in the year when prices were low which means if prices start really shooting up because of the crisis in the middle east, chinese buying will absolutely slow because they are sitting on inventory. China can process a lot of oil and release it into the market. A lot of the Oil Price Action will would be affected on both ends that way. As the economy ramps up in china, their demand for oil is not going to increase. You are saying the stock piles are strong . In that is right. Thank you. Coming up on Worldwide Exchange, stellantis upping the ante in the talks with the uaw as the strike enters its sixth week. We have the full story coming up after this break. Stay with us. But if its using untrusted data can you trust the results . 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Advantage, you explore endless design possibilities. To find your personal style. Endless hardie® siding colors. Textures and styles. Its possible. With james hardie™. Welcome back to Worldwide Exchange. Time for the big money movers. Solar edge shares are not looking sunny. Cutting the q3 profit forecasting significantly lower Fourth Quarter revenue due to a slump in solar Power Installations in europe. Solar edge has seen a number of unexpected cancellations from the european distributors in recent months. Shares are down 24 right now. Hp enterprise with weak guidance below expectations. The i. T. Giant shifting to increase longterm profitability. Hp looking to add cloud and a. I. To add 50 revenue by 2026. Shares down 20 . And intuitive posting revenue of 1. 47 billion compared to expectations by analysts. All driven by procedure volume and the install base of systems. Shares are down 8 . We turn to the Energy Sector now. The volatility in crude prices sent oil and gas stocks on a wild ride. Pippa stevens is looking at this months sectornomics. The sector up 5 compared to the s ps 11 gain. We started to see renewed investor interest in the Third Quarter with Energy Stocks up 11 over the last three months while the s p has dropped 6 . Oil traders are closely watching the war with israel and hamas and given the proximity to Oil Producing states. As geopolitical tensions flare, we look at Energy Companies revenue extstreams. 35 of revenue comes from outside the u. S. According to dp goldman sachs. That is broader than the s ps 29 . And exposure of 84 according to the latest round of filings. Baker hughes follows at 77 with exxon and apa at 60 each. Halliburton and apa round out the top five. Frank. I have to ask, earnings season started a short time ago. When it comes to the Energy Sector, are there big themes . Slb kicks os off this mornin with the offshore exposure which sets up the company well. We are seeing more growth in international than in the u. S. I think more broadly, the key thing is to watch executive comments around what the conflict in the middle east means for oil prices Going Forward and also what it means for cap x and drilling plans with wti above 90 a barrel. It looks more appealing to open the taps, but frank, they want to see numbers under control. Thank you, pippa. As we head to break, why the transport sector is telling a different story than the consumer stat according to a report from transunion. Americans plan to spend 51 less this shopping season. Were back after this. Announcer sectornomics is sponsored by sector spdr etfs. Hi, im jason and ive lost 202 pounds on golo. I was 424 pounds and my doctor was recommending weight loss surgery. To avoid the surgery, i had to make a change. So i decided to go with golo and its changed my life. Its 5 30 a. M. In the new york city area. Theres a lot more ahead on Worldwide Exchange. Heres whats on deck. Jay powell suggesting the fed may not be done with rate hikes despite progress. Former vice chair Roger Ferguson is here to layout the policy path forward. Will the third time be the charm . That is the hope for jim jordan as he continues to fight to be the next speaker of the house. We are live in washington. And the big three automakers taking an axe to the head count as the strikes continue to grow. It is friday, october 20th, 2023. You are watching Worldwide Exchange here on cnbc. Welcome back to Worldwide Exchange. Happy friday. We pick up the half hour with the check on the u. S. Stock futures after a rough session for stocks yesterday. Lets look at the picture. Red across the board. Dow hitting the lows of the morning. Down 70 points. S p and nasdaq fractionally lower as well. I want to show you the s p yesterday. The jay Powell Economic Club speak impacts the markets yesterday as today. The speech was supposed to start at noon. It was delayed by climate protesters. Shortly after he did get started and took the podium, the markets rose on the dovish comments and you see the move to the downside on the hawkish comments. The s p ending the day 1 lower. We will talk about jay powells comments throughout the show. Pressure at the open coming on bond yields as they hit the highest level in decades with the tenyear yield breaking through 5 for the First Time Since 2007. Right now, we continue to track the tenyear bond at 4. 94 . There is something on the screen to track all morning long with us. Watching the tenyear yield breaking the 5 mark yesterday. Take a look. The twoyear yield at 5. 15 . The long bond above 5 as well. It is not just bond yields, but wall streets fear gauge is the vix popping in recent days. Sitting at the highest level since march. That is back with the collapse of svb. You see the sharp tick to the upside here. We go to stocks rough session yesterday and what is shaping up to be a repeat this morning following fresh comments from fed chairman jay powell. Likely his last words before the Central Banks next policy decision near the end of the month. Powell highlighting progress on fighting inflation, but promising the fmoc will be quote resolute in sticking to the 2 target when it comes to inflation. Repeating the mantra of higher for longer. Evidence of your eyes is the economy is handling higher rates at least for now without difficulty. So notion ally, that will tell you the neutral rate has risen or we have not had rates high enough for long enough. We have formulas for everything. As a practice toner, we have to how policy is looking and if it is too tight right now. Joining me now is Roger Ferguson and former Federal Reserve vice chairman and cnbc contributor. Roger, great to have you here. Good morning, frank. Nice to be with you. Give us a sense. What was your take on the comments from jay powell . Was he hawkish or dovish . I came off the sense he was straight down the middle. Heres why i say that. He observed in the policy is restrictive and he observed they are making progress to their goals. He observed that and they are making progress toward both goals and he said they had to be prudent or cautious in how they proceed. In the short term, it felt like a wait and see speech. No movement in november. He continued to say the economy continues to be strong and they are prepared to move. I would not describe it as hawkish, but straight down the middle with not much excitement moving in november. Open to moving, if necessary, one more time this year or early next year. I dont know if that is hawkish or dovish. I think he is trying to take it straight down the middle. A lot of people are trying to figure that out, roger. I want to talk about bond yields. He said it looks like the rise in bond yields is doing some of the feds work for it. He believed they were rising to what he called the right reasons, not because the fed will take action. What did you make of those comments . I think two things. One is, yes, they are not anxious about it. I heard a number of fed officials in their public statements saying something very similar. Because of the tenyear yield and bond yields are higher, that may be doing some of the work for the fed. I was surprised he said it was nothing with fed expectations or fed policy. That is almost never the case. He is right. There are other factors as well. Including an expectation that the economy he will continue to be relatively robust. He mentioned, appropriately, fiscal policy. The government is having an issue in a bit with treasury securities to make up for the spending going on. There is one change in tone from jay powell. We had initial jobless claims out yesterday. Lowest level since q1 this year. He did not highlight that. Previously, they cited tightness in the labor market as infla inflationary. This time he did not talk about it. What did you make of that . I made of it exactly what you said. The reason i answered the first question is straight down the middle is he said what he historically doesnt say. There is tightness, but the labor market is less tight than before. Two, he did not talk about whats called super core inflation which was one of the things he had been talking about in the past. I observed as you did some of the things that were not said were telling. Thats why i came to the conclusion that probably not a move in november, but ready and undecided about a move in december. To the big question now, roger. A lot of people are asking for advice about this. When do you expect the fed to cut . People say they have to stop hiking before they can cut. When do you see a cut possible . The first half of 2024 or second half of 2024 or at all next year . I think my view has been probably not next year. If next year at all, toward the latter half. First haclf, absolutely not in the cards. Depending how things play out, the last hike may not be in december. If we see one, it would certainly be the second half, not the first half. Lets ask a long heer term question. Jay powell said we might just be in an environment where we have a higher neutral rate. It will be higher from now on. What did you make of that . I agree with it, frank live. I agree with it, frankly. It is not meant to be free money. Getting to the zero set fund target for long periods of time is abnormal, not the normal thing. I think the possibility of rates being back to normal and higher than historically for the last 10 to 15 years, but similar to earlier is very much in the cards. There are forces that suggest that might be the case. Im in alignment with the thought we should not get used to money being free. We should expect more normal pricing. Roger ferguson, great to have you here for your insight for days like these. Thank you. Thank you. Lets check on the top corporate stories. Pippa. Frank, stellantis announcing fresh layoffs as the uaw labor strike enters its sixth week. It will let go of 100 workers in pe perrysburg, ohio starting on monday. Uaw president shawn fain will hold a Facebook Live event later today. China is threatening to limit the exports of the key material used in electric vehicle batteries. Officials announcing permits will be required for certain ki kinds of graphite. The s. E. C. Dropping its lawsuit against two ripple lab executives. The Agency Claimed the ripple ceo and cofounder aided and ab company with crypto currency. Bitcoin up 4 on this news. Frank. Pippa, thank you very much. We will turn attention now to washington, d. C. And Republican Congress member jim jordan is not giving up his fight to become the next speaker of the house. A third vote is expected later this morning. Emily wilkins has more on the story. Emily, good morning. Will the third time be the charm for jim jordan . Reporter at this point, it doesnt look like it. It was a long day on capitol hill yesterday. It ended right where it began. Yesterday, we went in to take the third vote. It was clear jordan was still short to become speaker. Now we have a vote scheduled for 10 00 a. M. Today. It is not clear the needle has moved for jordan. He met with more than a dozen holdouts trying to see if he can switch their opposition to support. Some of the new york members told me he tried to offer a deal on raising the caps for state and local tax deductions. Really, every member we spoke with who left the room, said they were still uniformly opposed to jim jordan. John rutherford said the issue was for the holdouts to change jordans mind about continuing to run. Our mind is set. He needed to know there is no way forward for the speakership. He missed his moment of leadership when he failed steve scalise. That was pretty much everybodys opinion. Reporter now on the second round, jordan failed to get support of 22 republicans. That last time earlier in the week, several members say he will get less support on a potential third ballot. They are signs jordan could be settling in for a fight. Warren davidson tweeted last night that votes are expected throughout the weekend. While things look bleak for jordan, there is no clear step for ruepublicans. They had a fourhour meeting on wednesday. Remember, congress is soon going to need to vote on the white house package of 100 billion of aid to ukraine and israel and also taiwan. Remember, government funding runs out on november 17th. Lawmakers will have to decide to put a stop measure in place. Frank, there is a lot to do and no path to the gavel sdp. A lot of action. We are now on 17 days without a speaker, i believe. Reporter it is not great. I mention that fourhour meeting yesterday that republicans had behind closed doors. We got reports from lawmakers that there were heated words exchanged and yelling and frustration between matt gaetz and Kevin Mccarthy and others. You see it on social media with members taking swipes at each other. A lot of people who opposed jim jordan have come forward saying they are getting death threats. This is all exacerbated by the fact there is no clear path forward. You heard other names come up, but republicans are not unified and having a tough time getting unified doing any potential path for forward. Emily wilkins, thank you. Coming up on Worldwide Exchange, potential trouble for the transports. A nalk to an analyst on why somereot pumping the brakes on the optimism. Stay with us. The biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. It still does. What can you do with spy . Across the globe, industries are transforming and businesses need to navigate the changing landscape to stay ahead. When you partner with barclays, every change leads to a bold possibility. You have the vision. We have the insights, Financial Solutions and Global Perspectives to help you make it real. Barclays corporate and Investment Bank powering possible. With gold bond. You can age on your own terms. Retinol overnight means. The smoothing benefits of retinol. Are now for your whole body. Plus, fastworking crepe corrector diminishes wrinkled skin in just two days. Gold bond. Champion your skin. Welcome back to Worldwide Exchange. A number of transport companies opening the books this week with a mixed pick for demand and volume. Csx with a 22 decline this eps year over year. That is an east coast focus rail. Nightswift down 67 year over year, but growing revenue 6 helped by the truckload business. The same trucking business yellow was in before it went bankrupt. This is all as transports are set to cap off a 5 losing streak. Joining me is ken from bank of america. Thank you, frank. Eps with big dips for two transports. Earlier in the week, jb hunt said we are not at the end of the freight recession, but seeing signs of rebound. Are we in the freight recession or out of it . This is a really elongated freight recession. Normally we would see a lot of bankruptcies of smaller carriers. You see that eventual rebound. You start to see pricing. We had so much stored profits leftover from the covid rebound with the tightening that we see carriers stick around for longer. That is elongating the tail of the recession. Jb hunt reversed comments. A couple of months ago saying were at the tail end and now were still in it. I want to ask about the macro factor on the transports. If you look at the bottom of the screen, we are tracking the tenyear bond. Elevated rates. Are those part of the story with the transports and pressure . Absolutely. What you are talking about is something you have not seen for 40 years. Impact of inflation and high interest rates. All of that is impacting the consumer and that is causing volumes to not be as strong. Transports dont make anything. They move it. It is extending. Looking at stock movements. Nightswift. Big day after the earnings yesterday. Biggest company in the u. S. 75 of what we buy moves in the u. S. Via truck. What did you make of the report . Spot rates trucking is 15 and the rest is on contracted rates. That is the incremental. Those rates have been through the floor. Normally 1. 65 per mile. Now 1. 25 per mile. Now as you mentioned, earnings were way down. They bought the other company u. S. Express. 6,000 tractors. Onethird of the company. One question i want to talk about. Inner mode al. A lot of people think that is a read on retailers think consumers will spend. We had the retail number today saying more people will spend more money this year above 500 than 2020. What are you hearing when it comes to the volumes . That is computers and sneakers and things people pbuy in store . They talked about it being negative for three quarters in august and september. We some that turn positive. We are seeing the spot pricing. We are starting to see that come off to the floor. We rebounded. We are seeing a little move off the floor. It is getting better. Does it signal a soft Holiday Season . Fedex is commenting it is flat. Ken, thank you for being here in studio. Thank you. Coming up on Worldwide Exchange, one word that investors need to know today and jeff kilburg has a stock that wu need to know. Weill give you the name when we come back. Stay with us. sometimes, all the tenacity and grit in the world. Cant overcome the boundaries we face. so Morgan Stanley is partnering with the Womens Tennis Association to remove them. because this game is for everyone. meet gold bond daily healing. A powerhouse lotion that moisturizes, heals, and smooths dry skin. With 7 moisturizers 3 vitamins. And. New gold bond healing sensitive. Clinically shown to heal moisturize dry, sensitive skin. Gold bond. Welcome back to Worldwide Exchange. We have a market flash. Bloomberg is reporting that novo nordisk and eli lilly is exploring weight loss drugs for kids as young as 6 years old. This is according to bloomberg. Both drugmakers testing weight loss drugs for kids as young as 6. Still ahead, jay powells speech yesterday and the dow looks like it would open up 60 points lower right now. Were watching the tenyear yield as we watch that to move to 10 . We see it move throughout the morning. Looking at the bond picture with the tenyear yield at 4. 94 . With that, lets bring in jeff kilburg, counter erfounder of k financial. Great to see you. Great to see you, frank. What was your take on what you heard from jay powell yesterday . Actually, i thought jay powell was dovish. I know initially the market reacted to that. The tenyear yield went to 4. 90 . He hedged himself and he talked about being resolute. You talked about that earlier on the show. That put the bond vigilantes back in the captains chair. They ran the tenyear yield back to 5 . They achieved that target of 5 . When you digest what powell was saying, it was a dovish tilt. You saw the fmoc watch tool. It declined for the month. The rate hike for the rest of 2023 and the rest of 2024 is off the table. With that in mind, jeff, you said it was dovish. What is the wex word of the day . The wex word of the day is persist. That applies to the consumer and applies to the yields and treasuries and the persistence of the appetite for risk. I know the vix is above 21. I think you are seeing the markets persist. I know were in the middle of red october. We had a rough august and september. You will see markets persist to move higher which has been a theme for 2023. If the markets are going to persist and move higher, how are you dealing with equities . We had a mystery chart up a short time ago. That is one of your picks that you are bullish on. No drum roll . Intel. Why intel . I love it. Why a chip named right now with the disruption in the chip sector . That is the opportunity i had, frank. When you talk about what the market is contending with. The war in israel or the fact we are seeing rates move higher or 30year mortgage above 8 for the first time presents opportunity. It is not just the magnificent seven, which i own, if you look at intel or oracle or micron or some of the names like ibm. Ibm. Big blue. When you talk about intel, these are names that have the opportunity to move higher. When you talk about chips and chipmakers and where the market is moving, this allows the stocks to move higher. Ibm is a cloud player. It has been languishing all year long. If you look at ibm, pull up a chart, it hasnt been an before 150 in five years. All four of the stocks may be the fabulous four. I think they are poised to move higher. They are not talked about enough. Jeff, i would not waste my time trademarking it. Jeff kilburg, great to see you. Great seeing you, frank. One more last look at the futures. At the bottom of the screen, we are tracking the tenyear yield all morning long. Futures are in the red. Dow would open up 55 points lower right now. Off of its lows of the early this morning. The tenyear yield at 4. 94 . Staying steady throughout the hour. That is it for us. Squawk box is coming up next. Have a great weekend. Good morning. Fed chair jay powell finally waking up. Does he plan to hold the rates steady at the next meeting . The tenyear yield briefly touches the 5 level since 2006 or 2007. President biden, meanwhile, making the case for more aid to ukraine and israel in a Rare Oval Office speech. The request will go to a leaderless house. Well have the latest. Will the rising tensions in the middle east crush that deal between is it liv or liv . Liv. If they cant get that right. I think liv tyler is the way i remember it. And the pga tour. It is friday, october 20th, 2023. Squawk box begins right now. Good morning. Welcome to squawk box. We are live from the Nasdaq Market site in times square. Im becky quick along with joe kernen. Andrew is off today. Okay. Its friday. We made it here. It is raining in new york city at this point. There are red arrows when you look a