A round of banks upgrade price target on facebook despite the social network spooking investors with its big spending plans. All right. Good morning, everyone. It is 10 00 a. M. Here in london 5 00 a. M. On the east coast. The s p 500 seen off by 4 points the dow jones seen off by roughly 10 and the nasdaq lower by 8. 6 points. Were higher for the second straight session closed out the highs of the day, the dow and the s p up by 0. 7 each. We were pretty much unfazed by the fed. Once again held by the rebounded in oil, Energy Stocks doing very, very well. I want to show you whats again on with European Equity markets. We are modestly higher no huge gains. Weve had so many earnings out this morning. By and large, they were better than expected. Jpmorgan saying the proportion of Companies Beating earnings estimates is the highest since they started compiling that data since 2009. Go figure. The xetra dax higher by 0. 2 the ftse 100 also up by 0. 3 . That means were good at revising lower our expectation. Were getting in loan with the u. S. Here. Thats the usual game. We finally caught on to that didnt we . We did. Lets take a look at the Foreign Exchange markets. The dollar bid at least off the back of the fed statement, very little language change. Still expectation, improvement in the labor market going to open the door to rate hikes. Going to be watching the payroll numbers Going Forward to dollar story here. The euro dollar by some 20 ticks or so. Dollar yen 125 the figure to watch. 124. 80 has been the high over the last several sessions. Higher by 0. 2 . We are seeing gains by the likes of aussie and sterling here. Its not a broader dollar rally were seeing here. Lets look at the commodity markets. The gain that carolyn was saying lifting the oil majors for the second straight session, still managing to eke out gains here. Brent catching up 0. 6 higher and giving back some of yesterdays consolidation. Gold lower by around 1 . Lets talk more about the fed. The fed appears to still be on track for a september rate hike. The statement following this weeks fomc meeting did not provide a timetable. The central bank is signaling it wants to seek further economic gains and a rise in inflation before it pulls the trigger. It notes that Consumer Spending has improved and the statement made slight changes from the previous one in june suggesting a healthier u. S. Economy. What could be more important, some say, is the Second Quarter gdp reading, due out later today. Analysts by cnbc expect a rise of 2 in the Second Quarter. Watch for revisions, though to the First Quarter number. Some analysts expecting an upward shift. The production data a bit of a concern there, too. Theres a number of elements here. What were watching in terms of components is the spending of course. Thats expected to be a key driver of growth. Consumers finally taking advantage of the lower gasoline prices and businesses, too, with the hiring jobless claims it upping their lowest level since 1973 last week. Lots of elements to be watching here today. Lets continue that discussion, julia with peter oppenheimer, chief Global Equity strategy at goldman sachs. Great to have you on the show once again peter. Nice to see you. Weve been talking about tapering about tightening for more than two years now. This is all in the price now, isnt it . Well its of course well flagged that Interest Rates are going to rise. No surprise about that. Having said that we should bear in mind rates havent increased in the u. S. For more than a decade. Its quite possible that the point at which they do rise theres some increased uncertainty about the path that follows. At the moment the market is pricing still a very very modest path of rate increases and importantly a very low terminal rate. And if that changes over time theres still adjustments that could be made in terms of pricing. Youre not a u. S. Economist but obviously you look at that part of the world, too. I just wonder what your sense is of how healthy the u. S. Economy is, how healthy the u. S. Consumer is. Do you think theyre Strong Enough to stomach that first rate hike and the xwen rises even if you say were not beginning to be seeing a very fast increase . Yes. Our u. S. Economy is quite confident about a recovery coming through and a pace of growth of close to 3 in the second half. The First Quarter was extraordinarily weak. We should see some catch up in the Second Quarter. But as julia said in her report you have quite strong employment growth coming through. Saerl of as a result of that, the consumer should be able to withstand growth increases and rising rates. Should we worry about the inflation angle here . I mention the point, its quite interesting, they removed that reference to the Energy Price Stabilization. You know you can look at this how you choose to. They didnt acknowledge that or they didnt acknowledge some of the volatility in china. You know interesting. Theres a mixed picture, absolutely. Mixed both in terms of the inflation picture because you have relative price shifts going on. Obviously with lower Commodity Prices there will be disinflationary effects coming through. The stronger labor market should push through higher wages which should support consumption as you say, still the most important part of the economy. Our feeling is that the developed economies, the u. S. And now even europe are managing to sustain a reasonable pace of recovery. Its true that china is weakening but that should not, i think, destabilize the recovery were seeing in the developed market. S you made the point, look they havent raised rates for several years. Almost the first step is the hardest in a sense, irrespective of whether or not the economy can take a small 25 basis point hike. Which arguably, i think, everybody agrees it can here. Is there enough out there, justification, for them not having backed themselves in a corner here with the timing to actually push it back again . Beef seen this time and time againen as theyve said all along and for a long time now, things are really data dependent. Theyll be focusing on the sense that domestic economy and the labor market is in a robust enough state to be able to withstand an increase in rates from extraordinarily low levels. I think were getting to that point where its the case. Our feeling is that probably december is more likely than september on balance. But its within sight now. I think the markets have largely adjusted for that. The only risk i think is that once you start to see rate increases, if inflationary pressures were to pick up at all, you could then see a risk premium being priced in. Right. To reflect possibilities that subsequent rate increases come more quickly. Kind of ties to the point citi made as well. Yes. Two strong payrolls here between 210 and 225 k and that will be green light for a liftoff in september. Some have also argued maybe they really want to raise rates to be able to lower them once again amid a little bit of weakness. They have breathing room. Ammunition. Absolute. Peter, youll stick around. Well get your investment calls later in the show. Peter oppenheimer, chief Global Equity strategist at goldman sachs. Facebooks Second Quarter profit fell 9 partly on a surge in costs for r d and hiring new talent. Revenue rose 49 , beating forecasts and topping 4 billion for the first time. Mobile ads account to are nearly 75 of total revenue as users spend more time browsing facebook on their smartphones. The real story is the core mobile business on facebook. Thats whats driving the growth. Mobile has been a Phenomenal Growth driver for us. We have 844 Million People using facebook daily on mobile. Thats up 29 yearoveryear. We didnt have a mobile business three years ago and thats now three threequarters of our ads revenue. Thats growing 74 yearoveryear. We think we have the best mobile ad product out there. Investors appear to be focusing more on the surge in facebooks expenses up more than 80 . Shares fell 3 in afterhours. Probably also a little bit of profit taking. Over the last three months its rallied quite a bit, close to alltime highs. Bank of america said these guys dont disappoint. You have to go all out. Thats perhaps more of the point here. Theyve only missed once on revenues and earnings since 2012. Youre right. Only once. Got to be a good beat to move the dial as far as that stock price is concerned. We have to take a quick break. Coming up uber drives people to anger on the streets of many excoe. Do you want to find out why . We have the full story right after the break. Stay with us. Were back in two. Welcome back to worldwide exchange. Here are your headlines. U. S. Futures indicate a lower open after stocks manage to hold on to gains for two straight sessions. Shares in renault plummet despite stellar earnings as the french carmaker disappoints with guidance. Sony net profit soars over 200 as its turnaround plan bears fruit. Lets check in on markets in asia. Sri jegarajah is in singapore. What happened in that last hour of trading on the shanghai comp . Another bout of intraday volatility. This say familiar patent by now. The kalt lift for this negativity late session in the afternoon session was really a report in state media saying that some of the Major Chinese banks are giving a once over to their exposure in margin debt and stocks more broadly. This sent ripples and jitters through the Broader Market in the afternoon session. Were off by 2. 2 at the settlement. Early on it was relatively stable. Again, we saw this late session bout of volatility. Lets not rule this out in the near term. Lets not also forget its still a relatively high level of margin debt and leverage in the system and with that leverage comes volatility. Still hasnt been a fully exercised from the chinese stock market, the mainland at least. Theres a bit of a negative Ripple Effect the kospi down by almost 1 . The saving grace hear for some of the markets was that the fed did issue a relatively upbeat tone on the broader economic outlook. Nikkei like that it was up by more than 1 . Snapping four sessions of losses. Elsewhere, we did see some gains, julia, for the australian markets as well. Were up by almost 0. 8 . Some of the miners are back in favor. Thats where we stand. Thank you so much, sri. Obviously weve seen a lot of volatility, peter. If we look beyond the shanghai market and the fact that i the pot i made 64 at the time actually the shanghai market is in a bar market. What about the chinex . Its still one of the best performing Global Markets despite the fact that youve seen big falls. Exactly. I think its important to emphasize there are different parts of china that are trading in very very different multiples. The smaller cap stocks on the ashare mark set still trading at the high 20s and thats expense of by historic standards. Whereas if you look at the Blue Chip Companies and those listed on hong kong they tend to trade with multiples of 9. 5, 10 times and are relatively cheap by historic standards. Theres the blue chip Large Cap Companies are adding value. Thats the view our strategists in asia have. Whereas the small caps you mention, many of them are still very expensive. Interesting you think there is opportunity there or you think stay out of it for now . We think theres opportunities in the larger cap, particularly Hong Kong Listed chinese stocks. Go for the Hong Kong Listed. That seems to be the consensus view out there. European markets are rallying across the board. Shares in Deutsche Bank trading higher after net profit that topped expectations. Germanys largest lending still plagued by litigation costs. Investors are optimistic that the new ceo john krein can set the bank on a different path. Shell also powering higher despite a steep drop in Second Quarter profit. The almaker announcing 6,500 job cuts and a drop in Capital Spending. Shell keeping shareholders happy by sticking with dividend plans for this year and next. Peter oppenheimer, strategist for goldman sachs. Everyone likes europe. Youre no different. Thats true. Weve had two overall geographic views all year one is to be more positive on dm than em. What is that predicated on the weaker euro, better earnings . Were seeing a stellar earnings season once again. Maybe this is because weve managed lower the expectations very, very well. Whats the driver . Its a combination of those factors. I think europe is still relatively cheap. Remember that earnings are close. Theyve started to recover. Their recovery has been weak so far. Its starting to pick up momentum. Were expecting overall profits to be growing around 15 by next year. And youre starting to see a decent pred of beats, both this quarter and last quarter. So europe is very behind the u. S. In its cycle. Its cheaper. Youve got a lot of operational leverage margins are still relatively depressed. They can pick up. I think Economic Activity is also picking up in europe as well. Many of the markets, exem, theyre used to. Do you not worry this is a consensus view that everyone takes and positioning might be excessive. There are many different ways in positioning. The flows in europe have been extremely volatile. Youve seen strong flows into europe on hopes with the announcement of qe. Those throws started to recede again. Certainly i think people are much more positively disposed to europe now than they have been on average, over the last few years. Rightly so. Im not concerned that may be a consensus view. After all, it was a consensus view to be positive on the u. S. Market for the last five years. That was broadly right. The u. S. Economy as we discussed is looking reasonably good. Profits are close to an alltime high. Profit growth is slowing, margins are starting to peek out, we think. Were very close to an Interest Rate rise. When you tend to get multiple contraction. I think its just the differences of where we are in the relative cycles and valuation. The Interest Rate cycle will play into that as well in europe. The Interest Rate differential between the u. S. And euro. Very much so. Its true both at the short end and on the long end of the curve. We think that u. S. Longterm rates will rise versus european long rates. If you look at the correlation between the rate spread and equity markets between the u. S. And europe that tends to favor europe as well. I want to ask you very quickly on the uk. Weve heard the Dollar Strength is hurting, its a benefit for a lot of the european corporates. What about sterling . Weve seen sterling looking pretty good here too. They also have that exposure. For the ftse 100, you have pretty much 40 of ftse 100 Companies Paying dividends in dollars. Exactly. Theres an immediate currency negative effect there. The ftse 100 is also heavily weighted towards commodities which weve been negative about all year. That story is continuing to unfold. The ftse 250 is a much more attractive part of the market. We think its relatively more domestic. It has higher growth less of the commodity exposure. Although its not so cheap, we think that its still a much better place to be within the overall uk stock market context. The uk economy is relatively robust. Peter, always a pleasure having you on the show. Peter oppenheimer, chief Global Equity strategist at goldman sachs. We show you the video before. Uber cars were attacked and pelted with eggs outside of Mexico City Airport by crowds of licensed taxi drivers. The protest comes after the city created official regulations for smartphonebased Taxi Services benefiting the likes of uber. The rear window of one car was smashed with a rock but no one was reported to have been seriously injured. Despite campaigning against uber the organized taxi drivers of mexico city claim no involvement in the attack. Looking at live picks of greek Prime Minister alexei. Theres a concern we wont be able to sign off on a deal by the next deadline is. Hes really havingeing to bring the left of his party in line. Guys, this is what we have to go. Tough times for tsipras. Hed still win, right . Hes getting over 40 of the vote, yes, he would. It would just be more time delays. Not a case of losing an election just about the time delays. Another show where we didnt manage to avoid greece. Once again. Still to come on the show border disorder. Were live from the english coast, reporting on europes escalating migrant crisis. Well be back in two. You know your denture can look like your natural teeth. But, when you eat tough food the denture moves. Oh no this shouldnt happen. Try fixodent plus adhesives. Their superior hold helps your denture work more like natural teeth. And you can eat even tough food. Fixodent. Strong more like natural teeth. Fixodent and forget it. The french and uk governments are struggling with migrant crisis thousands after sigh lum seekers try to reach britain. Nine people have died since june as they attempt to break into container trucks traveling through the channel tunnel. Tell us about the full extent of the crisis, hadley. All right. It seems as though were having audio troubles there. As soon as we get her up again, we will bring that to you, of course. Meantime julia . French authorities are examining a piece of plane debris that washed up on reunion island in the french indian ocean to determine whether theres a link to the missing flight mh370. They believe its part of a wing from the boeing 777, the same type of aircraft as the missing Malaysian Airlines flight. Chinese authorities are seeking to, quote, confirm the situation with the relevant countries involved. Mh370, of course disappeared in 2014, at the beginning of last year. Terrible. Absolutely terrible. I want to get back out to hadley gamble. Tell us about the extent of the migrant crisis. Essentially what youre seeing behind me is a highway, were 17 miles away from the opening of the euro tunnel. Cars upon cars lines of traffic at a standstill. Its total gridlock out here. This is essentially off the back on the other side in france. Essentially what weve seen over the last several days as these tractortrailer trucks on the uk side are waiting on ferries that are basically delayed off the back of these new security measures thousands of migrants trying to make that 21mile jump to the uk. These migrants are coming from iraq, syria, ethiopia, eritrea. Theyre looking for a better life and taking advantage of the fact that the European Union as such open and porous borders. Essentially what weve already heard from the freight traffic association, freight travel association, they said that truckers here are losing as much as 750,000 pounds a day. The uk economy is losing Something Like 250 Million Pounds a day as well. There is a cost to this kind of migrant crisis. Theres a cost to these conflicts were seeing just not in the middle east but also in africa as well. Were seeing it even here in the uk. Hadley thank you so much for that very very troubling story. Meantime still to come on the show president ial suite or bargain b b . That after this short break. Welcome to worldwide exchange. Im julia chatterley. These are your headlines from around the world. Theres a new word around town. Making friends, a round of banks upgrade price targets on facebook despite the social network spooking investors with its big spending plans. Oil and gas stocks outperform in europe. Shell leading the charge as it slashes jobs and spending to cope with the Lower Oil Price but it maintains its dividend. Banking on the new shares. Okay. Good morning everyone. If youre just tuning in thank you so much for johning us here on the show. Heres how the futures are faring ahead of the u. S. Open. The s p 500 seen off by roughly 4 points. The dow jones is seen off by roughly 10. Look yesterday, we saw the second straight day of gains. We closed at the highs of the days. We are held by the Energy Stocks given that weve seen the continuing rebound in crude prices. The fed didnt make a big splash on markets. All eyes will be on the Second Quarter gdp number. Meantime in europe were seeing a fairly great picture. The ftse 100 is seeing begans of 0. 5 . Weve had earnings out this morning and by and large they were better than expected. Jpmorgan coming out with a note saying this is the highest number of companies in europe beating expectations since theyve started compiling the data back in 2009. And of course the weaker euro is helping. The u. S. Federal reserve has kept rates on hole as expected but qualified its language on the labor market while saying the economy was, quote, expanding moderately. On jobs the fed said the central bank now only needs to see, quote, some more improvement in the jobs market before it moves. What should investors read into the fed statement . Steve liesman filed this report. Reporter the Federal Reserve left Interest Rates unchanged in its july meeting as expected. But the question is whether it hinted at a rate hike to come at the next meeting. On the one hand it upgraded one part of the equation needed to raise rates, jobs but it left the second one, inflation, unchanged. The fed doesnt want to show its hand as it did in the 2013 taper tantrum. We dont want to see volatility in the financial markets. Reporter the feds said there were solid job gains, suggested it moved a step closer to criteria of gains in the labor market needed to hike. It also suggested a lower bar for hiking, saying it will hike when it sees quote, some further improvement, not just improvement. I think the fed is acknowledging the economy sim proving. I like their language around the labor market. The economy is standing up on its own two feet more than it has in some time. This will eventually cause the fed to raise rates. Reporter the fed characterized inflation in virtually the same terms it did in june. As running below the 2 target and likely to gradually rise in the medium term to that target. No progress there. That means a september hike still depends on strong job gains in the next two reports before that september 17th meeting. It depends on Inflation Numbers that dont slide backwards, even amid lower Commodity Prices and slumping international growth. Of course inflation is going to play a very big role. We continue to see that when we lack at core Inflation Numbers, that those numbers are gradually increasing. In fact if we look at the threemonth average annualized rate, thats also picking up which shows an upward trend. Was there a hint that the fed will raise rates in september . Yes, if you count as a hint theyll look at the jobs data and the inflation data between now and that september meeting and make up their mind then. Not much of a hn at all. Back to you guys. If we look at the upgrade in the language as far as the job market is concern, some further improvement. Weve been talking throughout the show what does some now look like . Some further improvement. Citi saying 210 to 225 on payrolls will be a green light for the fed to raise here. No adjustment to the language as far as the energy theyve taken out that reference to the Energy Price Stabilization bespite being off 10 since june. Thats interesting. Well be data dependent for the next two months. We have two more employment reports to go through and two more readings of the Second Quarter gdp. One of those is today. I wonder if the fed knows about the gdp print today and whether that influenced their thinking in any way schaap or formhape or form. Most definitely. They must have known it. What i think is interesting and different this time around is the fact that jackson hole will miss one of their most important members. Janet yellen is not going. In the past that has been the place where ben bernanke has been dropping the hints about qe not necessarily tightening or tapering. The fact that we wont be getting anything substantial out of jackson hole that leaves us flying blind longer. Cut to the chase, were still data watching. Nothing has really changed. Brazil hiking Interest Rates to 14. 25 the highest level in nine years as it struggles to fight inflation. The move was expected and brazils central bank is signaling rates will likely stay high for a long time. Inflation has been topping 9 this month, more than double the Central Banks target range at around 4. 5 . Greek Prime Minister tsipras has been addressing the Central Committee in athens. Were showing you live pictures there. Hes made a number of comments this morning. Remember, this is addressing including the extreme left part of his party here. Those that have raised questions about the dole that was sign. Theyre not happy with the terms. What hes been saying is, tsipras is facing a big dilemma at this stage. We go on with the compromise we signed or move on and do something else. Wed have to return to the imf for help. We know theyre very much against imf support Going Forward. We were forced to compromise. This is not a deal we necessarily wanted to sign. A lot of concern theyre not going to be able to sign a deal on a fed bailout. The likelihood is theyll have to get another further extension of cash and what conditionality will be attached to that. Greece doesnt go away in the background. It will be a hot fall. Most likely. Wynn resorts, gambling revenue from its macao operations weighed heavily. Meanwhile, myriad international raised its guidance for the rest of the year after Second Quarter profit jumped 25 . The group did miss analyst expectations on revenue but overseas growth and favorable currency conditions did help boost demand. Joining us now live from new york as ryan malik exr. What is your take on the outlook . They raised guidance but youty thats a little bit disappointing. Sure. I think when you look at marriott specifically first of all, you have to look at the results that are largely in line for expectations. Gains and losses associated with rae depreciation. Their 3q guidance came in light when it comes to eps with 72 to 74. 76. We were at 77. The full year was 5 to 7 indicating that things will be more 4q loaded. Cycle bearers will be more concerned that things are being pushed out a little further. Theres less visibility which creates uncertainty an thats disappointing. With regard to guidance the eps gidance anceance anceance was raised. Ebitda guidance was brute down 17 million at the midpoint. Now the high end of the Guidance Range is below where our estimate was and that of consensus. We generally think the market will be less excited about the broader guidance but the buybacks were very strong at 9. 1 million shares in the quarter which was better than we expected. That should offset it to some extent. We have a 78 price target. We think if the stock buys back wed be a buyer on the weakness. A lot of it will come down to the sentiment surrounding the sector which will be driven not just by marriotts results but starwood results this morning and the gdp number that will come out before the open. Its a very international company, isnt it ryen . If you look at the headwinds they faced, lower incentives for hong kong. They have a lot of exposure exposed to venezuelan currency devaluation impact as well. I think it will continue to have an impact. I think the market generally expects it to have an impact. Their guidance incorporates an impact associated with fx head winds. Its been built in. Marriott has probably the least nonu. S. Exposeureexposure. Whether it be starwood or hilton which is higher as well. 75 of the marriotts ebitda comes from the u. S. Its much more domestic than people realize. Interesting. You said weakness could be a buying opportunity to are marriott. Whats your topic in the sector . We have other Companies Reporting. Sure. Thats a great question. You know it depends on obviously the investor appetite. We generally are cycleables. We think well see the cycle persist at least through 2016. We want to own the operate owners rather than the operators. Diamond rock hospitality, we like Starwood Hotels on the strategy uk review process beginning on right now. We think something will materialize there. We think the market is pricing in, they do nothing and we disagree with that assumption. Brilliant to chat with you. Ryan ryan meliker. Marriott se Arne Sorensen will discussion the outlook for the sector. European markets are seeing quite a nice rally today amid a earnings. Deutsche bank, shares up by 7. 26 . The largest lender is plagued by litigation costs. The new ceo, jn krein, they are optimistic that he can set the bank on a different path. Rebuilding confidence. That will be absolutely key. The oilmaker announcing 6,500 job cuts and a 20 reduction in Capital Spending as the oil slump weighs. Shell, however keeping its shareholders happy by sticking with dividend plans for both this year and next. And still to come on the show, on the rebound, the u. S. Economy is widely expected to have bounced back quite nicely after that dreadful winter dragdown growth in the First Quarter. We lack at whats driving gdp, next. No students ever been the king of the campus on day one. But youre armed with a roomy new jansport backpack, a powerful new dell 2in1 laptop and durable new stellar notebooks, so youre walking the halls with varsity level swagger. Thats what we call that new gear feeling. You left this on the bus. Get it at the place with the experts to get you the right gear. Office depot officemax. Gear up for school. Gear up for great. Welcome back. Tesla has a new offer for model s owners refer a friend get a thousand dollars. The luxury carmaker will give that credit to anyone who buys a new model s. Ceo elon musk describes the program as a guerrilla tactic against car dealers in certain states that dont allow tesla to sell vehicles directly to customers. Owners who refer ten buyers will be able to buy a limited edition at a discount price when it goes into production this fall. Referring ten people. Wow . Phone a friend. They all have to buy or do you just give them the names. They all have to buy. Just ekjoking. Add yet another candidate to the gaggle of republicans vying for the white house in 2016. Former Virginia Governor jim gilmore has entered papers to enter the race. He would be the 17th gop president ial candidate. The first Republican Debate is set for next thursday. Investors will get a chance to see how well the u. S. Economy performed this spring with the first estimate on Second Quarter gdp. Thats due before the opening bell at 8 30 a. M. Eastern. Lets go to Bertha Coombs at cnbc headquarters. Certainly it will look better than the First Quarter . Thats the thought, carolyn. Personal whenever i splurge on something i shouldnt i always think im helping the economy. Well, the expectation is that the economy picked up in the Second Quarter as higher Consumer Spending and a pickup in housing offset the drag from Energy Prices and trade. The consentsus forecast is for gdp to increase at an annual rate of 2. 7 compared to a decline of 0. 2 . Q1 will be revised higher after the u. S. Government took steps to refine the seasonal adjustment. Economists say that left residual seasonality in the data which may have led to the overly weak growth we saw in q1. Second quarter gdp was likely boosted by the consumer as households use some of the extra cash saved from cheaper gas prices to go shopping. Consumer spending which accounts for more than twothirds of gdp is forecast to have grown about 2. 9 , up from 2. 1 . The Energy Sector may have continued to weigh on growth as it struggles by heavy spending cuts in the oil Services Firm in the wake of more than 50 drop weve seen in oil prices over the past year. There are possible signs of improvement, though, a number of producers are starting to think they may have seen a bottom. Data shows u. S. Energy Companies Added 21 oil rigs last week the third increase in drilling activity in the past 33 weeks. The strong dollar also likely will continue to impact u. S. Exports in the Second Quarter while also sucking in imports to meet a rise in domestic demand. Thats expected to result in a trade deficit that cut into growth. Trade lopped off nearly 1. 9 from gdp in the First Quarter. With oil prices and Consumer Spending having picked up in the Second Quarter, inflation also likely accelerated prices as measured by the pce index. And their forecast to have risen 2 after having fallen by just about the same amount in the First Quarter. Well see if my splurging on shoes actually helped boost gdp. Back to you. Were certainly doing our best to support uk gdp to match you, bertha. Wall street may be going to the dogs cats birds and hamsters, too. Petco is in talks with investment banks with a possible ipo. The company was taken private in 2006 by tpg leonard and Green Partners for 1. 5 billion. They have more than 1,400 stores in the u. S. Mexico and puerto rico. If it does list it will be the third time since 1994. And before we go to break, these are your headlines, u. S. Features indicate a lower open after stocks managed to hold on to gains for two straight sessions. Shares in renault plummet as the french carmaker. Try the superior hold. Of fixodent plus adhesives. They help your denture hold strong more like natural teeth. And you can eat even tough food. Fixodent. Strong more like natural teeth. Fixodent and forget it. Introducing the Samsung Galaxy s6 active only from at t. Tested to withstand pretty much anything life throws your way. Switch to at t and get a 300 credit with eligible purchase and tradein. We are mildly higher across the board, higher for a Third Straight session. We had a lot of Companies Reporting and most of them beating in terms of the top and bottom line. Two straight sessions of gains for the u. S. Markets. Seeing a bit of consolidation it seems ahead of the u. S. Equity market open. Two points lower for the s p 500, a few points lower for the nasdaq, the dow indicating higher by six points. Gdp the one to watch today. Facebooks Second Quarter profit fell partly because of r d and hiring new talent. Users spend more time browsing facebook on their smartphones. Shares down over 2 though in premarket. Joining us live from new york is kathy wood ceo of arc investments. What do you make of these numbers . They beat expectations across the board but theres a lot built into the stock price. Yes. The quarter was spectacular. Their Revenue Growth was 55 , ad Revenue Growth mobile ad Revenue Growth was 74 , just phenomenal numbers and operating margin 55 . Cathie a lot of people have been concerned about the spend increase, up 50 . Do you think thats needed to drive growth or are you starting to get worried about that too . No. We think they need to add head count. Our analyst considers this stock a threestage rocketship. Facebook is doing incredibly well user growth up 13 . The next stage which theyre preparing for to accelerate here instagram, messenger, whassup and they will launch oculus Virtual Reality in the First Quarter of next year. They have 76 now percent of their revenues with mobile. A huge shift that weve seen in the last couple of years. Theres problems attached to that, though in that its difficult to track individual users and tailor adverts to those people. Theyre monetizing it now. Do you expect them to be able to do that . Yes. Their atlas platform is excellent for this. They can track people from offline to online and offline again. Theyre able to track people across multiple devices. I dont think any other company can do this not even google. Theyre in a really good place. Very quickly, cathie, a buy at this level . Yes. Were definitely holding it. We always look for pullbacks to add to positions and thats true in this case as well. Cathie wood, ceo of ark investments. Thats it for todays show. Im carolyn roth. And ipm julia chatterley. Squawk box up next. Dont move a muscle. I asked my dentist if an electric toothbrush was going to clean better than a manual. He said sure. But dont get just any one. Get one inspired by dentists. With a round brush head. 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Welcome to squawk box here on cnbc. Im becky quick along with joe kernen and andrew ross sorkin. Check this out. Youll see right now, things are weaker this morning. Actually the dow futures have turned around now up by just over 10 points, the s p 500 is down by 1 and the nasdaq is down by 1. 5. The fed upgraded its view of labor yesterday but still suggested there are worries about the slow pace of inflation. The most postmeeting statement keeping the door open. Well have more from Steve Liesman many just a bit. Aviation experts say serial numbers on aircraft debris found in the indian ocean could help identify whether it originated from the Malaysia Airlines plane that disappeared last year. If that debris