Transcripts For CNBC Worldwide Exchange 20150402

Demonstrate in athens over fears of more cuts. A change in fashion. Clothing sales rise for the first time in four years sending its shares to the top of the stoxx 600. Hello and good morning. The last trading day before easter. A lot of people already on the slopes if theres still some snow left in the alps. Exactly. I love how the skig season extends into april. In the u. S. It ends in february or march. Im going to italy to do hiking and sightseeing. What about yourself . Going to see family. Got to make time for that. Even though its a shortened trading week we have a lot of focus on whats going to happen tomorrow. That will give us more clarity as to whether the fed will hike rates in the month of june or perhaps even in september. The big question is the fed has a dual mandate. They need to see acceleration in jobs but also signs of inflation because of course that has been the big concern not just here in europe but also in the u. S. Expectations 295,000 jobs in the month of february. January revised upwards of 257,000. Thats what the expectation is. The february jobless rate is expected to dip lower to 5. 5 . I always wondered what happens when the job report is released on a friday. On a holiday. Its happened a number of times over the last decade or so. The last time was actually 2012 and actually you can trade on the back of the report because Index Futures are open. Theyll be open for 45 minutes after the release. So if you really wanted to do that you could do that on good friday but also citi pointed out that reaction to jobs report has been fairly muted. Only 0. 6 to the down side or to the upside. Why . Because of fed transparency. What know what the fed might or might not do. The headline is not important but the real focus going into this potential fed rate hike will be wage growth because that could push up inflation as well as many economists have been predicting. There have been eck peckations that economists could lower their forecast after yesterdays much weaker than expected adp report. It marks the First Time Since january last year that fewer than 200,000 jobs were created in the private sector. That weighed on u. S. Markets. Steve filed this report. Investors riding the market bull these days have been forced to hang on for dear life as the economy and the market take them for a very bumpy ride. Freezing february temperatures in the east slowed Economic Growth and a strong dollar and weak overseas growth have flattened corporate profits. Add to that a stock market that seems to buck up by triple digits one day and buck down by triple digits the next. Over the last four months weve seen more economic misses than hits. We are moving forward to be sure and certainly companies have he recovered to a great deal but the economy is not getting that break away speed that many expected this year. The question for investors is whether they should look through the current weakness for smoother days a head. Last year riding the bull paid dividends. The economy sank by 2. 1 in the First Quarter but came raging back to grow by nearly 5 over the next six months. Is this another case where investors should hang on for the rebound . The economy is going to reaccelerate. I think weather played a big role. Particularly on gdp. The port strike had a pig effect and the underlying growth in the economy is still 3 . That will become evident as the year progresses. A big test comes friday with the march jobs report. Wall street looks for strong gains of 248,000 jobs but theres down side risk given the weak Economic Data and miss in the adp jobs report and ism manufacturing survey. All an investor can do is climb on the back of the bull and hold on tight. Lets have a look at european markets one hour into the trading session on the last trading day before easter. Its just modestly lower. Down by 0. 1 in trade this morning. Also remember the vols are expected to be low today as many people are already on holidays. Lets have a look at the markets one by one. Were seeing the dax just a touch lower but the ftse 100 is holding its head above water. Marks and spencer saw the best nonfood performance in four years years. Sterling will be in focus because well get construction pmi. Yesterdays manufacturing pmi was the best and the aussie dollar under more pressure and traders increasingly pricing in a rate as early as next tuesday and were seeing the euro some what higher against the u. S. Dollar. Dollar weakness is the picture of the last 24 hours as a result of the weaker than expected adp and ism report. All eyes on tomorrows jobs report. Looking at the Commodity Markets and oil markets in particular we saw really fascinating price action on the back of the report that showed production in the u. S. Had actually declined for the First Time Since last december but now markets focussing once again on the iran talks and thats bearish for the markets. Brent crude off by. 5 . Talks between iran and the nations have rolled into another day as negotiators try to hammer out a preliminary agreement to curb the nuclear program. U. S. Secretary of state john kerry asended his stay even as the white house repeated that it is prepared to walk away. I think our approach to these conversations hasnt change which had is as long as were in a position of convening serious talks that are making progress that we would not arbitrarily or abruptly end them but if we are in a situation where we sense that the talks are stalled then yes the United States and the International Community is prepared to walk away because we have been very clear about what kind of commitments we expect and we have been clear about those in excess of a year. Its not just the white house speaking out two days after the original deadline irans foreign minister urged the International Community to seize the moment. Trying for the past several days to make progress. We hope it exists in order to move forward. There are obviously problems that have presented us from reaching the first stage of finding solutions and i hope that our colleagues will recognize the fact that this is a unique opportunity that will not be repeated and they need to take advantage of this opportunity. Talk between Global Leaders will continue but will we get a deal . Nbc news joins us from iran with more on that story. Ali. Good morning, seema. Yes. Both sides pulled an all nighter last night. Negotiating until 6 00 a. M. This morning swiss time. Proposals, offers and counter offers have gone back and forth all night. The issue is whether the United States and European Union sanctions on oil, banking, and finance can be eased separately to United Nations sanctions. They want them lifted in one place but apparently theyre considering this offer right now. Talks hit a bottleneck and both sides are putting the ball in each others court saying the other side needs to be more flexible and show more compromise. The rhetoric also sharpened. Theyre saying iran needs to be shown respect but not pressure while the white house not too eager for a deal said theyre willing to walk away from the talks. Iran doesnt respond well to threats and pressure especially from the United States but it seems to be working right now because theyre still there and theyre talking and theres a growing sense that something will be produced. Now the question remains if they do come out with a statement or some sort of an agreement will it be enough to form the basis for a comprehensive agreement by the hard deadline of june 30th . So everybody is waiting to see what will come out today. Back to you. Thank you so much. Want to bring you the latest this is a investment company, the worst performing russian stock in 2014 but shares rebounded some what but this morning were getting Fourth Quarter numbers. Sistema saying Fourth Quarter net loss came in at 5. 3 billion. A big net loss. That is compared to a net profit of 47. 7 million in the Fourth Quarter 2014. Fourth quarter revenues 3. 9 billion versus 5. 5 billion in the Fourth Quarter the year prior. The chairman has been in a lot of legal trouble with russian state but it seems as though the legal troubles are coming to an end. He was arrested late last year but investors now a little bit more positive on the stalks. Coming up on Worldwide Exchange two days on from the Iran Nuclear Talks deadline. A move in the crude market could be overdone. Should he expect a correction . Find out after this break. Plus teslas timed press release gives the stock a late boost but it was just an april fools prank. Those details coming up. Mcdonalds follows wall street and introduces a minimum wage for employees but will it take a bite out of the stock . Well discuss that next. Why do we do it . Why do we spend every waking moment, thinking about people . Why are we so committed to keeping you connected . Why combine performance with a conscience . Why innovate for a future without accidents . Why do any of it . Why do all of it . Because if it matters to you its everything to us. The xc60 crossover. From volvo. Lease the well equiped volvo xc60 today. Visit your local volvo showroom for details. Welcome back. Oil prices are back in the red after rallying yesterday on the back of an eia report that showed u. S. Weekly output falling for the First Time Since late december but hopes for irans Nuclear Talks are keeping a lid on the games amid expectations that oil supply from iran could reenter the market. Lets discuss more. A big question is richard if a deal is reached with iran and sanctions are lifted how much will that contribute to an oversupply of oil already in the markets. Exactly. Thats the main question but i think were both looking at a volume question and a timing question. In terms of the volume i think you cant see that much more Iranian Oil Coming back even if sanctions were lifted overnight because they need a lot of investment and a lot of work. Maybe 2 or 300,000 more. In terms of timing we saw signs yesterday that even if a deal is done at the end of june and thats not a definite at the moment you probably arent talking about export sanctions being eased in the second half of this year. Probably looking at early 2016. Thats a later time line even for that quite moderate return in iranian oil. One of the reasons we saw the rebound in oil prices were talking about a 4 gain yesterday. That was catching the attention of oil traders because of an increase in production in texas. Is this a one time monthly drop or start of a longer trend, i guess . Id always caution a single data point doesnt tell you that much. Lets see its weekly data does get advised a lot but you look at the recount number were accepting to see shale production. Overall u. S. Production isnt going to go into decline just yet but if we start to see that change in direction over the next couple of months and gets confirmed in the final data that will be significant to the rebalance and fundamentals. Will we continue to see a great deal of volatility . We saw Oil Prices Surging by 4 and it might fall by 5 . Will we have to get used to continued volatility as we have seen in the Fourth Quarter of last year . Just for the moment yes. Theres so many different factors and moving parts that people are trying to model expectations about opec different supply risks on the demand side. Good Growth Numbers coming out but this extend of oversupply, all of these are competing because you have a lower out right price. A 2 or 3 move means more at 50 barrel than at 100 or 110. I want to talk more about iran because you say they would need a lot of investment and a lot of work done until they can export again. But what about the 25 Million Barrels in storage right now . They could export that right away and export it to buyers that continue to buy, china for example. Thats precisely the point. Theyre build up because china, india in particular have taken less but they can start selling that in the last few months. They dont need any more sanctions. They just need exemptions from the sanctions to take a little bit more each month. They can sell it right away to the likes of china, south korea, india, how much will the price of oil drop . This is the question seema was trying to get at before. The market will be heavily oversupplied after we got the return deal but how much will oil fall. In the next couple of months were oversupplied. Its the weakest demand for crude but that oversupply isnt looking as big as expectations at the start of the year. Thats because Global Demand is strong. Brent can go back down into the low 50s. Its unlikely to break through at least on a fundamental basis. Lets talk about inventories as well because Oil Inventories are at the highest level in 80 years. The industry is using about 67 of working Storage Capacity up from 48 in earlier 2014. If i was an oil trader id be worried for this reason. Well certainly they built up an awful lot there at high levels but your point was right. 67 of working capacity. That means we still have a lot of space left and what well see in the next few weeks is as more and more u. S. Refineries come online they have good margins and incentives to start running that crude and processing it into product and well see those come to a halt and especially if we then start to see u. S. Production slowing down a bit were not going to hit that point and i dont think that creates a huge amount more with pressure. This escalating conflict that we learned of last week that resulted in some volatility in oil prices. Since then the focus is on the iran nuclear deal. How closely are you watching that given that location. From an oil supply perspective yemen stepped back and realized its unlikely that yemen is going to spill over and impact saudi production but i think its still important to watch because it is a faultline and its going to develop into a long running conflict and saudi arabia could get drawn further into that. Before we left you go whats the probability that we will get a deal even if its a bad deal or partial deal as you call it. Yeah i think, maybe 75 but the longer we drag it on now the higher the risk of a break down. 75 . Ill take that. Richard mallinson. Sticking with oil, some analysts see crude hitting rock bottom sometime this quarter. You can go to our website cnbc. Com to read the full analysis on why. And steve has been taking a look at the impact on different economies around the world. Listen in. Some of the obvious places. This is from a 50 decline in oil with russia up there as well and then come down into asia here china, big beneficiary. India as well. All through Eastern Africa and then up through the middle here through nigeria and heres the middle east. Big losers. Interesting over here in south america. A bit of a division. Most of the country despite they have some considerable Oil Production here but then the north venezuela and columbia big losers. United states comes out as a modest beneficiary. 0 to 2 despite our huge Oil Production over the past several years and what were seeing right now is a situation where we seem to be registering all the negatives from the decline but none of the positives and economists say thats something thats going to take time. Heres the map that you got here of the world and you can see as well Eastern Europe is a beneficiary and all of europe a beneficiary except for when you go up to norway. The fire that broke out on an oil platform in the gulf of mexico left at least four workers dead and two critically injured on wednesday. A mechanical problem is believed to have caused that explosion. Mexicos state run firm says it managed to overt any Significant Oil spill and the accident is expected to have minimal impact on production. U. S. Regulators are charging kraft and mondelez with manipulating wheat futures. Theyre accused of using trading strategies to artificially lower prices. Theyre seeking penalties and restitution as well as an injunction against future violations of u. S. Commodities laws. Both are up higher. Lets take a look at stocks on the move in europe this morning. Marks and spencer up 5. 5 after Fourth Quarter Clothing Sales rose for the first time in 15 quarters. Meanwhile, online sales returning to growth with sales up over 13 . So finally a little bit of good news. Elsewhere on the ftse the u. S. Justice department saying that hsbc is making progress to clean up its act. This follows the banks 1. 92 billion settlement related to allegations of money laundering. Lets get back to an interesting story. Two sika investors say they will appeal a ruling that states they do not have to buy the whole firm. Now this is the French Building Materials Company bids for a stake in sika big enough for voting rights. It includes the bill and Melinda Gates foundation. Lets get everyone updated on the story out of greece. Greece submitted a fresh list of Economic Reforms to authorities in an effort to unlock more than 7 billion euros in bailout funds. Now the Financial Times which says it has seen the document reports that the proposals rely on a clamp down to raise most of the revenue. Euro zone officials are said to have noted it makes progress but theres still work to be done. National bank of greece euro bank and alpha bank were all lowered from a b minus rating to ccc. Rereflect the weaker economic prospects. Take a look at the greek bond market. That has been in focus. Weve soon seebeen seeing a rise since this Political Uncertainty came into focus in late 2014. Were looking at the three year yield at 18. 2 . Yield of 11. 8 . Negative yields in switzerland, sweden and denmark maybe you should invest in the greek debt market. No worries there. 11 yield. Thats amazing. Thats very very thick skin. Absolutely. If we show that yield curve again that tells you that investors pricing at a default for that country. Remember yesterday the rumor mill was in overdrive again. They reported that greece may not be able to pay back that imf loan worth 450 million euros. Which is coming up next week. Next week but then later on the government actually denied that so you have the back and forth results will they be able to pay it or not be able to pay it . Well get another fudge solution. Theyre going to kick the can down the road and not solve anything . Maybe find a brief deal that will give enough to athens to pay back that imf loan but is it really curing the main issue at hand here . Welcome to the euro zone. I wonder if he put himself in a precarious situation because he made unrealistic promises to his citizens when he was campaigning and now hes forced to offer more than he really wants to. I dont know about his popularity ratings. Theyre still pretty stable i would think. Do they have any other choice . Hes supposed to provide reform and stimulate the economy. The drama continues. A russian trawler has sank killing at least 54 crew members. Around 15 people are still missing after 63 were rescued by emergency services. Reports say drifting ice may have caused that disaster. Still to come Venture Capital investment for londons tech sector reaches a new all time high as they announce a 30 million funding round. Stay tuned for that full story. It begins from the second were born. After all, healthier doesnt happen all by itself. It needs to be earned. Every day. Using wellness to keep away illness. And believing that a single life can be made better by millions of others. Healthier takes somebody who can power modern health care. By connecting every single part of it. For as the world keeps on searching for healthier. Were here to make healthier happen. Optum. Healthier is here. In a booking rustic log cabin. Dad has secured the smart phones. And the children are left wondering. What else to to with these. Hands. Welc ome back hands you got it booking right. Booking. Com booking. Yeah european markets trade water as investors position themselves ahead of the nonfarm jobs number which will be released during tomorrows holiday. Another day and another extended deadline. Negotiations on a nuclear deal set to continue with all sides a agreeing that talks are fragile. A glimmer of hope for greece. Its latest reforms list has received a warmer reception in brussels as hundreds of greeks demonstrate fears of more cuts. A change in fashion at marks and spencer. Clothing sales rise for the first time in four years sending its shares to the top of the europe stoxx 600 index. Let me bring u. K. March construction pmi. Thats fallen to 57. 8. The reuters poll was looking for a number of 59. 5. The number that were seeing that is weaker than expected and we are he seeing though that confidence is urging so the number a little bit weaker. The confidence that seems to be some what better than expected. Obviously the Construction Industry has been hit by the uncertainty but confidence surging to a nine year high and according to markets theres signs of bottlenecks pushing up costs. And elections one factor to consider when looking at the Construction Industry slowing in the month of march. Sterling, not a big move there. Not a big move but we saw better than expected manufacturing pmi yesterday. All of the data points have been some what better than expected. Sterling heading a days low of 14815 after the u. K. Data. The value has more than tripled in the First Quarter. That according to a merger market. Lets look at european markets. How were trading on the second day of the second quarter. It is a shortened trading week because of easter. European markets will be closed tomorrow. Here on thursday were looking at a mixed trading session. The ftse 100 up about. 2 . Better than expected manufacturing data. He i was were down. 13 . Italian markets holding flat at the moment. Were seeing Oil Prices Continue to slide after that big blip to the upside in yesterdays trading session. That jump came after we had the eia data showing a job in u. S. Output last week for the First Time Since last december so bullish signs but today were focussing on the nuclear deal between iran and six world powers. Now to a corporate story. Walmart shares into the red on wednesday as the Worlds Largest retailer said it was looking at new ways to he lower prices. Among them how it sources its products. Courtney reagan has more on that story. Walmarts u. S. Ceo wrapping up his First Investor day today at the new york Stock Exchange. It was a 90 minute presentation with no slides or video. Fairly informal and lots of q and a. The presentation and the questions focused on making shopping fast easy and friendly for walmart shoppers. This will be the year for improving store which is will include better merchandise employee replenishment and assortment as well as improved store layout. He is focussing on the store experience and making sure that the product is priced low. Walmart has been urging suppliers to cut back on spending money on joint marking efforts so that walmart and suppliers can get together and offer shoppers the lowest prices on the merchandise. While it is focused on its Stores Ecommerce is a key Growth Strategy for the entire company and the key market here in the United States. If he were running a pure ecommerce player he would be pretty excited. About 4500 distribution points located within 90 plus percent of where americans live and a supply chain that can move goods fast. They didnt give updated financials though they were focused on the u. S. Same store sales which have improved for two straight quarters but it had been awhile since positive numbers were posted in that area. So investors are hoping that the trend will continue. Back to you. Walmart stock has been under pressure since announcing a minimum wage hike at the end of february. Shares are down more than 6 over that period. The company pledged to raise full time and hourly wages prompting other major u. S. Firms to follow suit. Mcdonalds is one of the companies. The iconic fast food chain is pledging to raise the minimum wage for full and part time employees at its company on locations also saying it will start to offer vacation benefits. 90,000 employees are expected to see a 10 boost in wages starting in july. Mcdonalds shares have been under pressure over the past year and you can see shares down about 1. 1 . So yes, an increase in the minimum wage. The question is carolyn, will this be enough to satisfy its workers . Of course fast food workers across the u. S. Have been demanding that minimum wage in the sector should be raised to 15 per hour. This of course isnt that much. Isnt 15 but it is a step in the right direction. It certainly is but then i wonder seema because mcdonalds has this model, can they actually theyre not under pressure. Theyre not forced to pay their workers more. Mcdonalds doesnt have that power over the franchisee so there were calls by some to unionize the franchisees to actually follow through with those wage rises. Questions remain on to how much will be translated to the franchisees that own mcdonalds and other chains. How that will translate to them. Its a good sign overall. The market is getting tighter. Theres more emphasis on retaining workers and that should be showing up in hourly wages and that takes us back to the report. Absolutely. Lets switch focus to our top story. Of course talks over Irans Nuclear program have resumed this morning. Two days after they were supposed to finish. Iran and russia voiced optimism on a deal. However, the white house made clear its ready to consider other options to produce an agreement. Hadley gamble joins us here in studio and whether we get a deal or not its drawing a considerable amount of skepticism. We even had Angela Merkel and the french president said it would be better to have no deal than a bad deal. Its not surprising when you look at who is involved. They dont have a time limit. The United States does have a time lilt because we say see action from congress in the coming days. Republicans and democrats are skeptical of the deal. The White House Press secretary was previewing the options for failure to reach this deal. There arent that many options. Theres a military option. Theres the wrd ofidea of kicking the can further down the road past the june deadline and then further sanctions on iran which no one wants. They dont have many options here and of course iran knows that. What would the u. S. Say when this deal falls through or defend their setting on the world stage in terms of their clout in negotiating big deals like that . Is that a major set back for them on the world stage . It would be another major set back in terms of Foreign Policy for the Obama Administration and it would be a difficult argument to the other members of the p5 plus 1. We have seen france much more hawkish than the Obama Administration and thats been the argument from Congressional Republicans and Many Democrats on capital hill that they havent been hawkish enough or tried to get enough from iran and the thing is what we know irans economy is in the tank. They need this deal. They need sanctions lifted but the questions right now are about what theyre prepared to agree on in terms of the frame work and what the language is going to look like. We know that iranian media is portraying this as an opportunity for all sanctions to be lifted. Its not realistic when youre talking about what the United States wants as well. Some critics are saying that president obama is turning a blind eye to severe ramifications for countries like israel. So not only push back from republicans but International Leaders as well. Absolutely. Its not just israel thats upset but saudi arabia as well and the effect were seeing in yemen. In this effort to show they have control over the peninsula. That saudi arabia pushed too far. They have gone a bridge too far and because were were 7 or 8 days into this. And unfortunately, you know he the un has come out today and talked about or yesterday talking about yemen saying this is on the verge of a collapse. This country is a disaster. So the knock on effect of these iranian negotiations whether they sink or swim is quite detrimental to the region. Theres concerns that if a deal is reached can we guarentee that iran will play by the rules. Theres no guarantees in this game. Thats part of the bigger problem and thats the argument from republicans and democrats, yeah. Arent they too tired to strike a deal . Thats a very serious question. Because maybe one or two or three hours of sleep. They were pulling all nighters on this one. We see that with the euro zone discussions in greece. Theyre in survival mode or something. They look like theyre comatose. But no progress being made. We dont know that. They kept a very tight lid on this over the last several months and last few days. Thats quite impressive. Both sides are leaking to the press but they understand its such a lie level of negotiation happening right now and theres so many balls in the air and so many things that were this to fall through that there would be such a huge knock on effect for iran and the United States as well in terms of the political situation that they cant afford to let this fail and thats why you see this extension of this deadline for two days when nobody wanted to talk about an extension. So its definitely within the interest of both parties to find a way to make this work but whether or not theyll be able to do that is anybodys guess. Fascinating discussion. Well continue to watch for further developments. Thank you so much. Still to come on the show testing your medal. Precious medals could be facing strong head winds from pretty unusual sources. Well find out where, coming up next. Arkansas governor vowed to pressure over the states controversial religious bill saying he will not sign the legislation legislation. He urged them to sign a follow up bill to make it more similar to federal law. The indiana governor battles intense criticism from signing the bill last week that many say discriminates against gay people. A Bipartisan Group will meet this morning to debate changes. Jay joins us from indianapolis. A powerful response from corporate executives. End us understand how citizens in india are responding to this law. Yeah, absolutely. Lets start with that response. Theres really been a backlash after this bill was signed by the governor here in indiana and, frankly, it was that frustration, the criticism coming from major corporations around the country, coming from religious leaders and others here that moved the situation in arkansas and forced the governor there to take a second look at what is happening rewording certain types of legislation and we expect there will be some type of compromise announced later this morning. In arkansas a little more time but in both states they were hoping to get something done before this weekend. Thank you for that report. On going talk of a fed rate rise later this year is continuing to weigh on the price of gold which is headed for a second straight monthly fall. The downward trend is being seen across all precious medals also facing strong head winds from a slump in demand from china among other things. Lets talk about the precious metal markets. Thank you for joining us this morning. I want to stick with platinum for a moment. Weve seen all the bearish factors but theres one very bullish factor. The strikes in south africa. Why are they not reflected in the price . It depends on the precious metal that youre talking about but the strike in south africa had an impact on platinum last year. The issue was that theres a lot of above ground stocks and i think consumers didnt really concerns. When are we expecting an improvement because were seeing increasing demands on the auto front. Up 7 . Were seeing double digit gains in spain, italy for example. When is that going to show . It starts to show now but the other side of the equation is really china and the chinese jewelry sector is one of the is the other key buyer of platinum and really i think, the crack down that we did see on gift giving last year on top of very high base levels in 2013 just meant that the imports from the chinese moving through the second half of last year in particular and into this year so that needs to come back as well. Its two sectors. Europe is important. Thats coming back. China would help definitely too. You have to have a strong stomach for the gyrations the past couple of weeks. One day were up. One day were down. This is resulting in investors looking for assets to invest in. So my question to you is can volatility alone drive gold Prices Higher . Volatility is one of the four main drivers in the of the gold price certainly and i think when youre thinking about 2014 the volatility did cause a lot of head winds for gold and i think that volatility is now coming back into the market and i think its one of the reasons why gold has actually been trading relatively stable around 1,200 per ounce. A little above and a little bit below but low volatility is one of the reasons why we think that gold prices may actually be kind for the gold market. You actually said last year that physical demand from emerging markets could essentially drive gold Prices Higher. Are you still sticking to that thesis . Yeah thats the longer term thesis. Obviously theres shortterm. Chinese demand was weak last year but when youre looking at it it was still following the longer term move and that is something that should support the gold market Going Forward. Gold demand in many emerging markets like china still below those of other more established markets. I dont buy that. Gold is at the mercy of the u. S. Dollar and rising rates at the u. S. Any bounce were seeing is going to be a bounce essentially. I can see where youre coming from. The environment is not super bullish for gold but the way we approach it right now if you go through the main drivers last year so volatility wasnt there, commodities were down. The dollar was strong as equities perform reasonably well so the question you have to ask yourself now is are we going to be in the same environment Going Forward that we have been in 2014 . The volatility is one factor where we see a little bit of a change coming through. Four factors extremely bearish for gold youre moving into an environment thats bearish gold and thats potentially a move higher. Negative rates in europe. Mentioned those at the moment makes it very difficult i think for cash allocation. Theres certainly a case to be made for some of the guys rather than paying for the privilege of owning a bond maybe you want to own a little bit of gold and earn a positive lease rate on that. Ew developments in the backdrop at the moment. But michael, this also speaks to a larger debate as to what drives gold prices. Is it physical demand from countries like india and china or is it fed policy. Fed policy is certainly, certainly important and you saw that in the last few weeks. I think the concern that we will have a very hackish fed and Monetary Policy differential between the u. S. And europe which would be very bullish dollar is one of the reasons i think why gold has not risen much further than it actually has and thats again one of those we had. If you get the fed into a state where they cant be quite as hawkish as it would like to be thats a factor supportive. Investors are the marginal drivers. Longer term as emerging market demand helps but you need the investors to drive Prices Higher. Yeah, they have to start buying. Were going to leave it there. Metal strategist at Merrill Lynch global research. Pleasure to have you on. A fire that broke out left at least four workers dead and two critically injured on wednesday. A mechanical problem is believed to have caused the explosion. Mexicos state run firm managed to overt any significant spill and the accident is expected to have minimal impact on production. A russian trawler has sunk in the western Pacific Ocean killing at least 54 crew members. Around 15 people are still missing after 63 were rescued by emergency services. Reports say drifting ice may have caused that disaster. California is in the midst of a historic drought and they called on them to cut their water usage by 25 . As we enter our fourth year of drought these conditions are symbolic all across the west. Were in the middle of the rainy season. Mountains should be lush with green and instead theyre bone dry. Today were at the bottom of a reservoir. We should be 30 feet under water here. Instead, these are the conditions. This is why california is in a state of emergency. In the snow starved sierra mountains where this measuring station should be under five feet of snow governor jerry browns made history. Were in a historic drought and that demands unprecedented action. For that reason im initiating an executive order mandating substantial water reduction across our state. Water use must be slashed by 25 . Because reservoirs across the region are running on empty as seen if this drone video documenting bone dry record breaking conditions. Nasa says this epic drought now effects 64 million americans across the west. Scientists call whats happening here unprecedented. Very likely the single worst drought of the last 150 years and possibly approaching the last drought of the last 500 to 1,000 years. The governor says californians need to change the way they live but with a state in 1. 5 million swimming pools and sprawling growth that wont be easy. Cities like long beach fined businesses like this mcdonald for wasting water. Now theyre installing new water meters to monitor consumption. In most cases absolutely it changes their behavior very quickly. They know were watching. You cant hide. Fall out will soon tarnish some of californias most spectacular sites. The ribbons of white at the National Park will turn to a trickle by june. Some state rivers will soon become creeks. Even trees are are dying. This is the new normal and well learn how to cope with it. While the governor is tonight optimistically hoping that theyll reduce their water use by 25 nothing is going to help these except for rainfall and snowfall. That simply isnt going to happen. Tonight many are wishing the governor did more ordering mandatory water rationing. That also isnt going to happen. The governor is saying he is doing all he can for right now. Switching gear, go daddy goes public. Shares soared as much as 34 on the debut on the Stock Exchange yesterday. We have all the details. After a quarter of lackluster ipos go daddy went public with a bang today. The price talk was 17 to 19 but the shares ended up being priced at 20. Went public at 2615 and closed at 26. 15 and they increased the size of the offering from 22 to 23 million shares. It generates a lot of debate. It still has healthy organic sales growth. 16 and that seemed to be a big attraction. Its still the Worlds Largest internet domain register with 21 of that business and theyre diverse identifying moving into web hosting. Bit a lot said the company is losing minute and has high debt levels and plenty of powerful competitors including amazon and google. Its been a while since an ipo generated this kind of debate. Back to you. Then you have to wonder whether timing was more important than the underlying Business Model at least in the couple of trading days of the ipo. They pulled their previous ipo in 2006. Because of market volatility. Absolutely. I get worried with some of these companies. No profits. Yet the stock soars. Tesla shares an april fools prank on their website. They hint it will take on apples new watch with its own model w. This incredible new device doesnt just tell the time but it also tells the date the statement said. The stock jumped 0. 8 before the truth set in sending shares slightly lower. I find this incredibly irresponsible on behalf of tesla. Its april fools and you want to have fun but the stock moved on this fake release. You have to be careful there. I think the sec would look into that if they do have a problem with that. Well see. Elon musk tweets all the time. I guess thats okay. Why wouldnt this be okay. But the difference is he thinks thats the truth. Hes projecting. Youre right. That is true. Lets take a look at one company yesterday, shares moving lower after the company delivered weaker guidance in its Quarterly Earnings after the u. S. Fell. Micron sees revenue below guidance. Down 2 in frankfurt. Heres a great story for you. You have more of a chance of seeing elvis shopping in a supermarket than you do of winning the lottery twice. Tell that to one couple in england that scooped the jackpot for the second time. Good job. The odds of that are 283 billion to one. They won the first jackpot in 2013 and have done it again this march netting another 1 million pounds. Good karma. Comes back to good people. What would you do with your lotto winnings . You can get in touch with us and email us at cnbc. Com and tweet us at our personal handles. Were on the bottom of the screen. And still to come on the show it was a choppy q1 for u. S. Markets as poor earnings weighed on the dow. Our next guest says this quarter could be the quarter for equities to out perform. Stay tuned to find out why. Welcome everyone. Youre watching Worldwide Exchange. Im seema mody. These are your headlines from around the world. Global markets right now treading water as investors position themselves ahead of the nonfarms job number. Investors await for supply data and talks on a nuclear deal with iran are extended for another day. Mcdonalds follows in walmarts footsteps and raises its minimum wage but most employees will miss out as the hike does not apply to franchise restaurants. Californias governor orders residents to cut water usage by 25 to combat a drought. The first time in history the state has introduced a mandatory reduction. And welcome everyone. It is thursday morning and of course kind of feels like friday since the shortened week and tomorrow is a holiday. Wall street will be closed but many traders will have to go into work or watch cnbc well be following the jobs report and the dilemma is the recent bout of disappointing data. Can we blame bad weather or is the worlds most important economy actually slowing down . Thats why the jobs report tomorrow is so important because every data point we have gotten was patchy and disappointed analyst forecasts but the jobs numbers have always been better than expected. Weve seen that plus 200,000 jobs growth for more than 12 months now. If we gedt a bad number tomorrow maybe the downgrades are justified. Absolutely when youre looking at the u. S. Economy jobs has been a bright spot. We have seen an acceleration in jobs growth. The big question is wage growth. When are we going to see significant signs of an increase in wage growth. In thursdays trade were looking at futures mixed. The dow up about 37 points. Interestingly enough the nasdaq underperforming in premarket trade down about 12 points. The s p 500 has been on a volatile run given the stabilization we have been seeing in oil prices. A 245,000 increase in march. The rate, the ploilt rateemployment rate is expected to hold at 5. 5 . These are the numbers you have to watch but the stories these days not just about the jobs picture but inflation the big part of the story. A fairly mixed picture. The ftse 100 is out performing because marks and spencer has come out with numbers better than expected. Especially in the clothing space. Volumes clearly ahead of Easter Holiday are thinning out. Lets move on and lets take a look at the currency market with the dollar still some what under pressure against the euro also against the japanese yen. Euro trending higher by 0. 6 and why is the dollar under pressure . It was the weak adp report and ism report and also treasury yields falling back below the crucial 1. 9 level putting further pressure on that currency and the commodity space, oil is lower after yesterdays big spike on the back of the eia data. Wti crude is once again focussing on the iran talks. Down by 0. 2 . 49. 97. Brent crude off by 0. 2. Lets also get you a run down of what to watch this trading day. Weekly jobless claims are expected in the u. S. Wall wall street forecasting a gain of 285,000. Weekly rig count is also due today. The stock market is closed tomorrow but the u. S. Labor department will release the march jobs report. The Unemployment Rate is expected to stick at 5. 5 while nonfarm payrolls will rise by 245,000. Thats compared to the 295,000 in the month of february. Theres some expectations that economists could lower their forecasts for the jobs number after yesterdays much weaker than expected adp report. The release marks the First Time Since january last year that fewer than 200,000 jobs were created in the private sector. That weighed on u. S. Markets. Steve filed this report. Investors have been forced to hang on for dear life. Freezing february temperatures in the east slowed Economic Growth and a strong dollar and weak overseas growth flattened corporate profits. Add to that a stock market that seems to buck up by triple digits one day and buck down by triple digits the next. Over the last four months we have seen more economic misses than hits. We are moving forward to be sure and certainly companies have recovered to a great deal but the economy is not getting that break away speed that many expected this year. The question for investors is whether they should look through the current weakness for smoother at as ahead. Last year it paid dividends. The economy sank by 2. 1 in the First Quarter but came raging back to grow by nearly 5 over the last months. Is this another case where investors should hang on for the rebound. The economy is going to reaccelerate. Weather played a great role particularly on gdp and the underlying growth in the economy still 3 . That will become evident as the year progresses. A big test comes friday with the march jobs report. Wall street looks for strong gains of 248,000 jobs but theres down side risk given the weak Economic Data and a miss in the adp jobs report and the ism manufacturing survey. All an investor can do these days is climb on the back of the bull and hold on tight. Mcdonalds is raising minimum wage for full and part time employees at its Company Owned locations and will start offering them vacation benefits. 90,000 employees are expected to see a boost in july. It follows similar moves by retailers walmart and target. Theres speculation it could drive the Fast Food Service competitors to follow suit. Mcdonalds shares have been under pressure over the past year. You can see shares down about 1. 2 . U. S. Regulators are charging kraft and mondelez in a scheme that allegedly reaped more than 5 million in profit. Theyre accused of using trading strategies to artificially lower prices. Theyre seeking unspecified penalties and restitution as well as an injunction against future violations of u. S. Commodities law. Shares of kraft and mondelez were higher. Negotiations continue over Irans Nuclear program as world powers work toward another deadline extension. After the break we cross over to teheran for the latest. In new york state, were reinventing how we do business so businesses can reinvent the world. From pharmaceuticals to 3d prototyping, biotech to clean energy. Whether your business is moving, expanding or just getting started. Only new york offers you zero taxes for 10 years with startup ny business incubators that Partner Companies with universities, and Venture Capital funding for high growth industries. See how new york can grow your business and create jobs. Visit ny. Gov business these are your headlines this morning. Mcdonalds raises its minimum wage for full and part time employees at its Company Owned locations but not at its franchise restaurants. Californias governor imposes water usage restrictions as the state faces a historic drought. And to our top story, talks between iran and the p 5 plus 1 nations have rolled into another day as negotiators try to hammer out a preliminary agreement to curb teherans nuclear program. John kerry extended his stay even as the white house repeated it is prepared to walk away. I think our approach to these conversations hasnt changed which is that as long as we are in a position of talks that have progress we woenuldnt just end them but if we sense the talks have stalled we are prepared to walk away. We have been clear about the commitments we expect and clear about them in excess of a year. Two days of the original deadline irans foreign minister urged the International Community to seize the moment. Been trying for the past several days to make progress. We hope hah the political move by all parties exists in order to move forward. There are problems that prevented us from reaching the first stage of finding the solution and i certainly hope that our colleagues will recognize the fact that this is a unique opportunity that will not be repeated and they need to take advantage of this opportunity. Lets get back out to nbc news. Ali, how are the iranians feeling about the delay in talks . Well obviously theyre very tired and they look exhausted on both sides and the situation still remains opaic. A major issue is whether u. S. And European Union sanctions on iran, oil, gas and Banking Sector can be removed separately to United Nations sanctions. Iran always insisted they must not be removed incrementally. Obviously both sides reach an impasse impasse. We dont know whether theyll be able to reach a solution but the rhetoric has become sharper. Theyre saying the iranians need to be shown respect and not be pressured and they made their position very clear while the white house threatens to walk away. The regime doesnt usually respond well to threats and pressure but it seems theyre there an theyre talking and theres a sense that it may be the issue today. The Iranian Foreign minister said if a statement does come out today he would present this with the eu high representative. Obviously not with john kerry and the substance of that is going to be very very heavily criticized. They want to see if they do give an agreement today will it form the basis of a repeat agreement by the 30th of june. Carolyn. Thank you for that. Lets take a look at u. S. Futures on this thursday morning. It is the second day of the second wart. Quarter. Stocks Holding Ground up about 40 points. We have been seeing the nasdaq under a considerable amount of pressure. It did break 5,000 in the month of march but now around 4,290 down about 11 points given the pressure that tech has been under. Lets talk more about u. S. Markets and the trade on tech with the portfolio manager. Chad good morning to you. Ever since i have known you have been a believer in tech and historically speaking tech tends to out perform in a rising rate environment but when we take a look at upcoming earnings tech is a sector that makes about 40 of its rev new oversaeseas making it vulnerable to the stronger dollar. How tow see erngdo you see earnings playing out for the sector. Were looking at modestly up for the eps side. We like large cap mega tech. Old World Technology names like the cisco os and the ors of the world. We believe for 2015 would be to go toward more of the low names and move away from all the high momentum stocks with the high multiple slice of the market. We would be hesitant when it comes to investing out right. You have to be selective. How would you view apple . New or old tech . Thats been one of the outperformers. Up about 13 year to date. Some say its starting to look expensive. Are you an investor in this stock . No were not. We do think apple is a buy but on the Asset Management side the group that i work in we do not own apple. One thing to note is technology. You have to be careful when choosing individual names like that. Why are we still seeing this disconnect between bonds, Economic Growth and stocks specifically im talking about u. S. Treasury yields falling back below 1. 9 yet economists are still expecting 2. 6 growth number for 2015. How can you reconcile that and based on that disconnect how do you want to allocate your money . Thats a great question. We have been overweight equities and recently we went to an underweight. We believe the global backdrop is one of decelerating growth. We believe the United States gdp numbers will be farlower than expectations. 2015 eps numbers for the s p 500 will be below everyones expectations and when you look on the valuation side you have forward looking multiples of 17 times and of course market cap to gdp of 150 which is really on the historical side range. Now i could make a case if margins, Profit Margins for s p 500 companies were quite low from a historical basis but Profit Margins are two standard deviations on the high end. So youre not going to get earnings lift from margin improvement. You have to rely on Global Growth and global trade which we believe will be lackluster in 2015 and into 2016. Now theres one thing the bulls are looking at. The liquidity programs from all of the Central Banks. We believe that perhaps that may be a fools game because now valuations in the United States are becoming some what stretched. Lets talk sectors. Yesterday we saw q1 winners being sold off and thats health care. What do you want to do with the sectors . Do you think they have further to run . Im talking about health care. Like i mentioned earlier, our schematic for 2015 is to invest more in overweight low momentum stocks and sectors and shy away from more of the high data sectors and individual names. So we like when it comes to the health care names we would overweight health care. We look at etna as well as abbott labs. We believe you can get a 10 to 15 total return over the next 12 to 15 months. When you look at consumer staple names general mills, pepsi as well as busch. The dividend yield is attractive and growth trajectory is attractive and when we look at consumer diskres mary i would stick with the walmarts and the t. J. Maxx. I think the spend and transfer and benefit from fuel costs being so low will just transfer eventually over to these names in regard to the top line growth and you can see over the next 12 to 18 months better than expected trajectories. All of this fed noise about a potential rate hike thats causing some investors to take money out of the dividend paying sectors like utility which is is the worst performing sector in 2015. What do you do if you invested in this sector . Is it time to cut your losses or do you stay invested in utilities . Were currently underweight utilities but i will tell you when it comes to the yield curve and Federal Reserve, we believe the Federal Reserve will go one in 2015 but then theyre going to not going to go on a systematic approach for 2016 because they brought down all of their fafts for inflation as well as growth trajectories. One thing to note though we believe that when the federal he reserve raised rates that actually the long end of the yield curve is going to flatten out. Its not going to steepen and perhaps utilities may be some what attractive when that starts to occur. Yeah of course april is historically one of the best months of of the year for stocks. The dow gains 1. 2 in this month alone. Well see if history repeats itself. Pleasure to have you on this morning. Thanks for having me. Have a great day. Still to come on the show a day after arkansas governor boys to pressure over a controversial religious freedom bill indiana lawmakers meet to discuss changes to their legislation. Were live in the state capital after the short break. Stick with us. He urged lawmakers to either recall the bill or pass a follow up measure that would make it more sil to federal law. Meanwhile the indiana governor continues to battle intense criticism from signing a similar bill last week which may say discriminates against the community. A group of indiana legislatures will meet this morning to debate changes on what to expect. Jay joins us live from indianapolis. Take eightway away. They worked late into the night trying to find a measure here. They removed others trying to ensure protections for everyone under this bill saying it was never the intent of the measure to block businesses from serving anyone. They want to make that clear. Trying to get that done here in indianapolis before the easter break which comes tomorrow and the start of the ncaa mens championship basketball tournament which begins this weekend and runs through the first of next week and because of the backlash here the governor there deciding he wouldnt sign the bill. Sent it back to the legislature. If they cant find a compromise within the next five days and nothing is done with that bill its not tabled. It automatically becomes law. We probably havent seen the last as far as the debate is concerned. Nevada lawmakers expected to move on their religious freedom bill sometime next week. Thank you so much. Californias governor called upon businesses and residents to cut their water usage by 25 as the state battles a historic drought. Its the first time a restriction on water use has ever been imposed. Theyre prepared to inflict fines of 10,000 a day to districts that dont succeed in implementing it. How are they going to monitor that . Are they going to be Walking Around and seeing which sprinkle sprinklers are on. Thats what i remember happening during the drought we faced in oregon when i was a child. You have to do what you have to do as citizens to make sure that you dont have a significant drought where you dont have drinking water. Thats a big concern. Well see how they monitor it. Another top story, a fire that broke out on a oil platform in the gulf of mexico left at least four workers dead and two critically injured on wednesday. A medical problem is believed to have caused the explosion. They managed to overt any Significant Oil spill and the accident is expected to have minimal impact on production. Well leave you with a look at how futures are trading. The last trading day of the week. A mixed open. The dow up about 41 points but then the nasdaq being left behind down just about 11 points. More on todays trading action coming up after this break. Its 5 30 a. M. In new york. Welcome everyone. Youre watching Worldwide Exchange. Im seema mody. This is your headlines from around the world. Global markets treading water as investors position themselves ahead of the nonfarms job number which will be released. Investors awake further supply data and talks on a nuclear deal with iran extended for another day. Mcdonalds follows in walmarts footsteps and raises its minimum wage but most employees will miss out as the hike does not apply to franchise restaurants. A historic drought calls for historic action. Californias governor orders businesses and residents to cut water usage by 25 . The first time the state has introduced a mandatory reduction. We have been talking about the recent price action. April is one of the best months for the year for stocks but equities showing a little weakness. Take a look at futures. The nasdaq getting left behind. It is underperforming right now down about 10 points. While the markets are closed tomorrow the highly anticipated march jobs report is due which many are saying will give markets a better indication as to whether well get that june rate hike. Yesterdays edp report suggesting it may not be as expected. Manufacturing has not been that strong. Thats one of the reasons the dollar has been undermeasure. Thank you so much far that. Theyll be keeping a close eye on the jobs report out tomorrow as investors speculate whether a june rate hike is still in the cards. Fed few tursutures indicating a rate hike. Our next guest still expects to see two rate hikes this year. Thats not a typo. Two rate hikes is what the global head of Asset Allocation is expecting. Why two rate hikes . Its sr. Little. You have an economy in the u. S. Running on 23 . Q1 is going to be very low and q2 is going to be around 5 . So we believe the fed must very gradually and very slowly but must. What about the recent disappointing data over the past couple of weeks . Thats pushing some to say maybe the rate hike wont come until september or 2016. I interviewed charles evans, fed president from chicago and he was saying we can expect a rate hike this year given the recent disappointing data plus inflation is still well below the Central Banks target of 2 . We should be very careful about the u. S. Economy. Remember last year you had storms and very bad winter the q1 was minus 2 an q2 was up significantly. To 2. 5 or 3 and it seems this year is going to be a very similarly one. Q1 will be weak and q2 is going to be significantly stronger and on the inflation front we know that year on year Energy Prices are at the bottom and year on year it will gradually normalize. So we become much more positive in six to 12 months time and the fed knows it. Youre one of the more bullish guests in the last couple of weeks. Lets talk about your Asset Allocations. You like long the s p 500. Short russell 2,000. Why is that if we see two rate hikes as you predict. The dollar will continue its bull run. That means that stocks which are exposed to the International Trade arena, s p 500 stocks should suffer. From an economic standpoint you might be right. Probably too much compared to me. The liquidity conditions are going to drive in the u. S. The u. S. Dollar liquidity is going to dry up. The rise of u. S. Dollar small caps recently grows. But the russell 2000 went up strongly against the s p in the last six years in a row. What we expect is the drying of liquidity condition in the u. S. Dollar markets will prevent that part of the market to continue to rise and that should continue. Now i want to talk about whats happening here in europe because were looking at double digit gains for the dax, french markets, italian markets, a rally for european equities united by draghi and quantitative easing the question is at what point is it fully priced into this market . Because valuations at some point are going to look expensive. The bond market valuation, when you have more than negative yielding thats an expensive part of the equation. Equity markets are not cheap anymore. They were cheap in 2012 but not anymore. What we wish the investors to gear up to is the earnings cycle. You have to yield cap and incorporate earnings between u. S. And european corporations and we feel this in the coming quarters. Negative yielding bonds in sweden and switzerland and denmark as well. Thats pushing investors to invest in european equities. I would think that would also make the u. S. Bond market more attractive. If the fed hikes. If the fed hikes that triggers a flattening of the shape of the curve which is preventing the bond market to be at risk here and you have reallocation of the negative yields. So yes you have some protection to get from the u. S. Bond market. Just finally, are there any trades that you like right now that are not consensus trades . Im looking at your calls and they seem to me all very very in line with what the market is positioning right now. Any of them that are against what the market is expecting . Protection against the fed to hike earlier than market expectation, to be careful about equities and especially u. S. Equities is one. We had shy of u. S. Assets ahead of the selection. We believe in Political Uncertainty will drag up and might be sterling or the ftse. Woe have a trade to invest massively in asia whether bonds or equities. That slow down in Economic Activity is priced in and it will come rate cuts will come. Thank you so much for your time this morning. Have a good easter break, global head of Asset Allocations. Lets give you an update on the Kenya University shooting. The Islamist Group al shabaab claimed responsibility for that attack on aiken Kenyan University saying it is Holding Christian hostages inside. The death toll is now at least 14. Well keep you up to date on that developing story. Were also watching iran. Talks of Irans Nuclear program have resumed had morning two days after they were supposed to finish. Iran and russia voiced optimism on a deal. However the white house made clear its ready to consider other options to produce an agreement. Hadley gamble joins us here in studio. Do you think are we expecting a deal today . Certainly were going to get some language out of these guys. They pulled this all nighter. Were talking about how exhausted they must be put that speaks to the pressure that both sides are under. Im talking about not just iran but the United States as well. Major pressure to get language out before congress can act and what we have heard is people are very worried that the Obama Administration is so desperate to get a deal that theyll give away too much and interesting backtracking from the white house yesterday. We heard josh earnest talking about the possibility of failure. What would the options then be. But theyre not really options. Were talking about a military intervention. Nobody wants that. More sanctions on iran or kicking the can further down the road, past june 30th. Nobody wants that either. So i would be highly surprised if we dont get something out of them today. But you seem to apply the u. S. Is under more pressure than the iranians to strike a deal. Why is that . Theres no question that iran needs these sanctions lifted but this is the frustration that were even seeing from members is the United States is under pressure because of whats happening on capitol hill. Legislation as early as this month talking about how they could potentially override a president ial veto and make sure that sanctions stay in place or impose new sanctions. The white house is very afraid that that action taken by congress will derail any talks they have Going Forward. The members of course with the exception of the United States do still feel that this is pushing things at too rapid of a pace. Thats why we saw these guys coming and going and some push back from our allies by Angela Merkel worried this deal is going too far forward without taking as much as it could be. German chancellor Angela Merkel as you were just pointing out saying it would be better to have no deal than a bad deal. And this is something that interestingly as we say the white house was mentioning last night the possibility of failure which is something we havent heard from them. President obama saying if youre giving away too much pull the plug. But i think youve seen the commitment from all sides to stay again overnight, push on through the early hours of this morning means at least well get some language later today. Some are saying it will be a Historic Deal if it does come together because they will end a 12 year standoff between the west and iran. Hadley, thank you so much. U. S. Regulators are charging kraft and mondeleze with manipulating wheat futures. Theyre accused of using trading strategies to artificially lower prices. Regulators are seeking unspecified penalties and restitution as well as an injunction against future violations of u. S. Commodities laws. Shares of kraft were higher. And still to come waging war on low pay. Mcdonalds raises its minimum wage but will this make a difference . Stay tuned for the full story after this break. Were back in two. Why do we do it . Why do we spend every waking moment, thinking about people . Why are we so committed to keeping you connected . Why combine performance with a conscience . Why innovate for a future without accidents . Why do any of it . Why do all of it . Because if it matters to you its everything to us. The xc60 crossover. From volvo. Lease the well equiped volvo xc60 today. Visit your local volvo showroom for details. Hey, good morning to you. Mcdonalds is raising the minimum wage for full and part time employees. The move will effect some 90,000 workers at the fast food chains Company Owned locations. They can expect a 10 lift in wages starting in july and theyll become eligible for vacation benefits. Average hourly pay is 9. 01 and they expect the average hourly sallies to exceed 10 an hour. The he decision comes after walmart and target recently decided to bring up its minimum wages too and theres speculation that the latest move could drive competitors to follow suit. Shares have been under pressure over the past year. They have been fighting weak sales, weak traffic and slumping sales in the u. S. And a huge chunk of mcdonalds workers wont get the new rate. Thats because about 90 of restaurants are operated by franchisees that set pay and benefits for their own works but they could raise wages too in order to stay competitive as employers employers. Over to you. Thank you. Maybe this is a big turn around for mcdonald with the new ceo. He has been trying to battle the falling sales and also improve Customer Experience really. Options as well. No but the Customer Experience in the mcdonalds restaurants. Sometimes theyre dirty and sometimes the Customer Experience isnt that great because service isnt that great. So maybe if we see that rise in wages maybe that will improve some of them. Better in customer satisfaction. This is being seen as good news for low wage earners. They have been holding strikes and protests demanding more pay. The question is will this be enough to satisfy fast food workers . Time will tell. All right. These are the headlines. Just a quick reminder, markets tread water ahead of tomorrows nonfarm payroll number will will be released tomorrow. A nuclear deal with iran is extended for yet another day and Indiana Republican leaders are set to alter laws surrounding a controversial religious freedom bill after facing criticism that it discriminates against homosexuals. Well be back in two. In new york state, were reinventing how we do business so businesses can reinvent the world. From pharmaceuticals to 3d prototyping, biotech to clean energy. Whether your business is moving, expanding or just getting started. Only new york offers you zero taxes for 10 years with startup ny business incubators that Partner Companies with universities, and Venture Capital funding for high growth industries. See how new york can grow your business and create jobs. Visit ny. Gov business welcome back to the show. Quick look at european markets. A fairly mixed session. Caution ahead of the jobs report friday but these markets too will be closed for good friday tomorrow. The ftse 100 inching slightly higher. High after better than expected numbers. Seema. That seems to be what were seeing in u. S. Premarket trade. Of course yesterday the big focus was on oil, a rebound by about 4 . Gold in fact also gaining a little bit of shine. Up about 2 today ahead of the highly anticipated jobs report tomorrow. The dow is up about 43 points. Daz nasdaq down 10. Weekly jobless claims are expected in the u. S. Wall street is forecasting 285,000 International Trade figures and the weekly rig count numbers are also due. That will be important given the high focus on oil prices. And even though the stock market is closed tomorrow the u. S. Labor department will release the march jobs report. The Unemployment Rate is expected to stick out 5. 5 while nonfarm payrolls are expected to rise by 245,000 compared to 295,000 gains in the month of february but you can still trade on the markets Index Futures for about 45 minutes after the release. Thats right. Lets look at the other top tech stories were showing today. Go daddy shares soar after investors buy into the 20yearold firms transformation. Another big story, tesla moving higher in yesterdays trade but only because of a fake press release announcing the release of a watch. Happy april fools day and a citi analyst lays out five reasons why apple should be trading higher. We decided to bring in ingrid london to discuss these top three tech stories. Lets start it off and kick it off with go daddy. It was a big go on wall street gaining about 30 . But they made 1. 4 billion in revenue in 2014. Yeah so its go time for go daddy. Well, the thing about go taddy is it has been around for a long time and yes it has been for years but it is decreasing and thats the thing i think investors are looking at but revenues continue to grow. That net loss continues to shrink. They have been shifting a lot of their business, their web domain and web hosting. They have been trying to add a lot of features to the mix. Small business stuff. Accounting and mobile internet. All of that gives them other revenue streams. All of that looks interesting to the market. Those outrageous ads. Do you think that played a role in strengthening its brand name. They say any press is good press. I think with go daddy theres going to be a lot of haters. There are a lot of really antitwoanti antigo daddy. The thing with the super bowl with them playing adds controversial with animals. I think that despite that the market is not that sympathetic to the bigger public sentiments. The numbers are growing. They have 13 million customers at this point going up. The numbers tell the bigger story. The other story that caught our eyes was the tesla story. They actually managed to pull the markets. The stock was higher. I know. Why is it that tesla can do that . A couple of things there. First of all elon musk a real moon shot kind of guy. Always putting out these crazy requesteds requests and hyper loop. When you think of all of these things together everyone is a little trigger happy when it comes to tesla. They put it out just before the markets closed. It was like five minutes before it closed so i think that between those two things you kind of get a big, you know boost and people are almost ready to believe anything when it comes out of his mouth. Do you think thats irresponsible behaveior on behalf of tesla. I feel like people get a pass on april fools in both directions. Both for misreading the stuff and the other thing. For people to jump on rumors its definitely not the first time. But for tesla the actual launch were still waiting for is that potential home battery station. Do you think thats a game changer for them or do you dodgers they have to come up with something bigger than that really . I dont know. I feel like moving into the home area is definitely a smart doing a home charger is is definitely something they need to do to kind of expand the applicable car. The game changer isnt going to be about ways of charging the cars out there but when the price points come down. So when you know your average person can actually even conceive of buying one of these which are effectively still rich mans toys that will be the big game changer for the company in my opinion. And from tesla to apple, citi adding apple to its focus list. One of the catalysts will be the roll out of apple pay internationally. So the question is you follow the payment space very closely, can apple make fwraedgreat strides in mobile payments. What i would say is i think that with apple they have a lot they have huge amounts of goodwill in the business. In the mobile business. And in my from what i have seen since they have announced apple pay, the amount of companies that have been just talking to me. The amount saying the boost they have seen from everybody across the whole ecosystem so were talking about from Small Businesses to customers to all of those companies that are in that chain that kind of make the payments work, everyone seems to want to have a piece of it now. That will make a big difference. And of course this comes ahead of the i matchwatch release. Do you think that will be a game changer . Is there going to be a lot of demand for this wearable. I may be a bit of a watch skeptic. I have the most uncool watch ever. I think that people a really really high end really expensive ones but in that trickle down way i think that theyll definitely make a big impact. Yeah. Of course valuation wise citi says apple does look attractive. Despite the run in shares off the highs but still up about 13 year to date. Absolutely. Thank you for coming in today. Have a good easter break. Ingrid london and tomorrow is the big jobs rt. Yes it is. What are we expecting . A print of 245,000. What about the jobless rate. 5. 5 . Expected to stay steady for the month of march. Of course we have seen an acceleration in job growth over the past couple of months. Will it continue despite bad weather that we have seen in the early part of 2015 in that will be the question and of course u. S. Futures right now mixed. Were looking at the dow up about 40 points. The nasdaq down by about 11 in premarket trade. We saw a mixed trade in the european markets. Volumes are thinning. A lot of people have left their desks. Theyre on their way to their easter break. You have an exciting easter break coming up. Italy for me. Germany for me. Well see you back here on tuesday. Have a good break. Thats it for todays show. Have a great day. Next up, squawk box. Good morning burning the midnight oil in switzerland. The Iran Nuclear Talks extended again. Reports of progress but no deal yet. A wage hike at the golden arches. Mcdonalds increasing the average pay of 90,000 workers to about 10 an hour but not everyone is happy about the news this morning. Well tell you why. And a world of trouble for google. A chinese regulator slamming the search giant overnight and europe is reportedly preparing antitrust charges. They have been looking at for five years against this company. Its thursday april 2nd 2015 and squawk box begins right now. Hive from new york where business never sleeps, this is squawk box. Good morning, everybody. Welcome to squawk box here on cnbc. Im becky quick with joe kernen. Andrew is enjoying the week off. We warned you to be ware of april fools jokes but not everybody got the message. Tesla poked fun at apple tweeting a new model w. Some traders missed the joke. Shares of tesla jumped at the end of yesterdays session. The stock gave back most of that move. Well have the story in just a little bit but first up to speed on todays market picture. Right now theres red arrows again. Dow futures down by 35 points. Nasdaq down by about 7. Here are the big stories were watching today. Secretary of state john kerry