Plus, oil markets squeezed again as russia and saudi arabia send more shockwhataves throughe market and china throwing more stimulus at the private sector to boost the struggling economy in the recovery. It is friday, august 4th, 2023 you are watching Worldwide Exchange here on cnbc good morning welcome to the show. Im dominic chu in for frank holland. Lets kick things off with the u. S. Stock futures after the s p and nasdaq turned in a Third Straight day of losses, futures right now showing a brighter picture, at least for now. S p implied higher by 15 points. Dow jones industrial average implied higher by 55 nasdaq up 83 a tech recovery may be in the works. This is ahead of the july jobs report economists are expecting employers to have added jobs at the slowest pace since december of 2020 at just 209,000 net new jobs for the month checking on the bond market. 10 2year yields yields on each up 5. 5 to 6 this week alone. The 10year treasury is 4. 91 . Slightly lower the 2year treasury is 4. 92 which is slightly higher the 30year treasury is 4. 28 . In energy, oil is on pace for the sixth straight week of gains to the upside. Wti up 38 cents to 81. 92. That is a. 50 gain. Similar move for ice brent crude. 85. 48 now to the top story and two of the most important stocks in the market apple and amazon moving in opposite directions as you can see here this morning, after two very different quarterly reports, apple is down by 2 . Amazon is up 8 . Lets stick with the apple side of the story first the stock is under pressure in the premarket after the Third Straight quarter of falling sales. The longest stretch since 2016 the management is warning the pressure could continue in the Current Quarter and if it falls one more time, that would be the longest revenue losing streak going back to 2001 apple is down 2 in the premarket Arjun Kharpal is in london with the latest on the story. Arjun, how much is just about the iphone side of the business . We thought the growth side was services and that seems pretty good absolutely, dom the market wasnt expecting blockbuster earnings given the 50 runup in the stock. They wanted apple to show stability. While eps and revenue were beats, but you mentioned the iphone number was in focus that is where the concern was. Apple in the june quarter brought in 39. 67 billion of revenue for apple. It was down 2 year on year. Elsewhere, other hardware, mac and ipad, showing significant decline. Uncertainty in the hardware space and consumer appetite as well the company has not given official guidance, but they expect revenue to fall again in september which raised more concern for investors. There are a couple of bright spots. The revenue up 8 in the june quarter year on year that is acceleration from the prior quarter. That is positive about the slowdown in services which has become a massive business and it continues to show how apple continues to be able to eek out revenue from the 1 billion iphone users the other bright spot is china revenue up in it the region 8 as the overall market for smartphones declines there apple is doing well in the highend of the market there and now iphone 15 launch is the neglnext expectation and if it can reinn v reinvigorate sales the overall role with tim cook and the growth Going Forward in india. Can you tell us more with the trajectory in china and india for apple . China is something ill deal with first, dom. In the market, consumers in china have shown a willingness to pay more for phones the willingness to pay more for the phones was up 5 year on year that bodes well for apple. They sell in the highend category as the broader Smartphone Market in china slows down one of the interesting things there is apple the was the only vendor in q2 in china to show growth it is holding up well there with the expensive iphone models. India is next here with the talk about tim cooks visit and apple opening physical store there is. The company saw record revenue in india in the june quarter as well separate data here q2 was in india with the largest market and secondly with the iphone sales in india it is clearly huge and focus for apple in the coming years. Dom. Arjun kharpal in london thank you very much. Shares of amazon are on the blowout for the quarter and return to double digit growth unlike apple the biggest growth beat since 2020 due to cost cuts and the largest amount of layoffs in the Company History and citing confidence in the biggest ever amazon prime day they have had Ceo Andy Jassy sounding upbeat on the outlook for aws, web services and Cloud Computing last night he said the revenue was stabilizing. Lets bring in our analyst at cfra amazon topped the estimates on nearly every count this was, in many ways, unexpected how could they do it so well dom, thanks for having me it was a standout quarter. I think all of the pieces are starting to fall into place for amazon on the ecommerce side, you saw improvement in profitability in advertising, you saw that grow at a 20 clip aws growth was 12 which was above the 10 estimate i think more importantly, amazon said aws is starting to stabilize. There is potential for acceleration for the second half of the year. All of the pieces are moving into place for amazon. Amazon is critical to the overall market narrative, but also it performed really well. It is not anywhere near what some of the megacap peers have done with the downfall last year is this enough to get us back toward what apple is seeing in terms of stock growth or microsoft or alphabet or other megacap tech names . Meta in particular for amazon, the number one driver for the stock is aws business there was a lot of concern in the past few quarters that aws is decelerating and concern with investors that amazon is moving market shares for microsoft and google aws beat consensus this quarter and andy jassy said aws growth is beginning to stabilize sets up the stock well for the back half of the year especially with the opportunities in a. I. And Machine Learning and large language models. Amazon is yet to monetize the products and services. I think that will with happen i4 the outlook is positive for aws. That is the number one driver for the stock. Is there any way we can extrapolate macro tailwinds for the rest of the Cloud Computing and business based on what we heard from amazon or is this execution specific for aws i think what you can conclude is the Cloud Computing cycle is beginning to trough if not already to trough. It seems the worst is behind them for amazon, customers are continuing to cut costs. Enterprises are trying to save money. For aws to grow 12 year on year on the 88 billion business, that means amazon is bringing in a lot of customers and migrating more customers to the cloud. The tailwinds are outweighing the headwinds there. That will continue in the back half arun, thank you very much have a nice weekend. We have a lot more here to come on Worldwide Exchange, including the one word that investors have to know today first, a wild week for bonds as the selloff intensifies and what it could mean for u. S. Stocks coming up next plus, more on apples rough report and if another quarter of falling sales is changing the Investment Outlook for our next guest. And later on, getting set for the july jobs report we get insight from ziprecruiter veey know the jobs market. A ry busy hour when Worldwide Exchange returns after this commercial break now is the time to partner with our experts. Get started today with verizon business. Its your business. Its your verizon. Im so glad we did this. Im so glad we did this. Im so glad we did this. Life is for living. Lets partner for all of it. Im so glad we did this. Edward jones new natures bounty hair growth. Clinically shown to help grow thicker, fuller hair with just one capsule a day of advanced hair complex. Conquer hair thinning. And fall in love with your hair all over again. Only from natures bounty. Welcome back to Worldwide Exchange. Check out what is happening in bonds this week. Yields on longterm treasury securities, 10 30year in particular, with worries of inflation reemerge and that is ahead of the jobs report today which is expected. They are focusing on the u. S. Fiscal outlook as underscored by the treasury plan to borrow 1 trillion this quarter and the fitch downgrade this quarter lets talk about this with matt malley bonds are something that we all are i mpacted by, i guess is the best way to put it with consumers and businesses how significant is this move higher in yields and do you think it has legs . Well, i guess the second part of the question does it have legs is less important than are yields remaining at these levels we saw the people this week saying yields could go a lot higher again, i dont know that really matters. We are back to the highs of the year and close to the highs that we saw late last year when the stock market was 20 lower im not saying this means the stock market will have to roll back over in a meaningful way, but it creates head wiwinds. Valuations are a lousy timing tool we are almost 20 times the next 12 months earnings, that is harder to justify the valuation levels at the end of 2021, we were up at these levels at 21 times earnings and yields were lower it is a concern for me in the stock market how much should we glean or put into the idea that rates rising the way they are right now is to a certain degree about the fiscal commentary about the country and also is this pricing in the idea that recession is now off the table . Part of it. The other reasons you mentioned are important. One of the other things, too, and you mentioned it is the huge increase in the supply it is supply and demande it is funny because we have been buying all this stuff with treasury yields and now bonds and notes. This is a big impact this will have an important impact on the market i guess my point is when we talk about recession being off the table, people need to be im getting complacent im sorry. What we have right now is a year ago at this time is when the yield curve got inverted it is usually a year later we see the impact of the inversion take place we are now starting to see issues with the consumer maybe seeing cracks there. Im not so sure recession is off the table. Before we let you go, lets bring it back to the equity markets as well. We talk to you about it often. Is the stock market due for a pull back or do quewe keep this trend . It is difficult to keep this trend. That doesnt mean the market has to fall off the bed. The tech stocks have had a great run here, but getting expensive. Because the tech stocks are more expe expensive than the market doesnt mean it is okay. They are back to levels. I like to rotate to cheaper groups like Energy Stocks and health care. Rotation is what matt is suggesting matt, thank you. Thank you ahead on Worldwide Exchange, the get out and travel trade is alive and well for now boosting this stock after a stellar earnings report. Well have that mystery chart when we come back after this break. Old school wisdom, with a passion for whats possible. Thats what you get from the Morgan Stanley client experience. You get listening more than talking, and a personalized plan built on insights and innovative technology. You get grit, vision, and the creativity to guide you through a changing world. [phone starting route. ] Technology Helps us navigate to work. [phone go straight. ] but, to navigate the complexities of modern work. [phone turn left. ]. You need more than technology. You need cdw. [phone you have arrived. ] so well implement cloud based microsoft modern Work Solutions like microsoft 365, teams and azure, so your teams can collaborate with zero trust security anywhere. [phone destination ahead. ] microsoft makes modern work possible. Cdw makes it powerful. Progress toward global net zero will take big thinking put into even bigger action. It starts with us developing and deploying Carbon Capture and storage to help lower our carbon intensity. While also developing partnerships to create worldclass storage hubs to help other industries, like cement, reduce their emissions too. Innovating toward Lower Carbon Solutions today, while helping others do the same for the future. Thats energy in progress. Well come back to worldwid exchange. We have booking Holdings Soaring after the estimate beat by 30 and the record Summer Travel season despite higher flights and costs. The company which owns Services Like booking. Com and priceline and open table says it saw revenue increase by 27 and is especially optimistic about the a. I. Enabled travel assistance to help customer needs shares up 11 right now. Shares of fortine. It is fortinet cut with the slowdown after pressure. Those shares down 17 premarket draftkings stock rallying on the Second Quarter profit beat and increase to the full year sales with the confidence of the legalization of gambling across the united states. Draftkings is up 13 oil prices are ticking higher today and on pace for the sixth straight week of gains anyone who pays at the pump knows this this is after the saudi arabia government is extending the output cut of 1 Million Barrels per day through september. Russia will cut oil exports by 300,000 Barrels Per Day next month. It is unlikely to cut the overall production cuts. Oil prices up 80 for u. S. Benchmark and International Prices lets get to the chief bureau chieffor Energy Intelligence amina, this is one where we have seen supply cuts weigh on markets before and pump up prices, but not to the extent we have over last few weeks why is this time different were seeing a tighter market in general, dom, as you know with the inventory levels have been declining there is a lot of uncertainty in the market over growth and the fed hike its rates last month. There are questions about the economy with the mixed data coming from china as well with that is why russia and saudi arabia still needs to pursue the policy of caution and thats the main reason behind them deciding to extend the cuts by another month into september if you take a look overall at the way things are shaping up in the macro perspective, you see Rising Interest Rates in the u. S. Which should be a negative for commodities and you talk about relative term on the currency market with the dollar which also should be a negative for oil prices then we have fears of recession which are receding is oil now telling us there is no recession coming for not just the u. S. , but the world as well . Thats a really good question i think we saw the opposite happen early in the year with opec cut and the price wasnt budging. It was staying at a similar level. The detachment we are seeing in the market with fundamentals and price are not really interlinked. That needs to happen in order for us to see the real impact of what is happening here are the voluntary cuts keeping prices up . Absolutely they managed to speed up the costs as well. Still, i would say there are fears of recession and fears of a slowdown it is not translating to the price yet, but perhaps we will if opec stops the cuts and goes back to pumping at full speed or pumping at levels previouslyto the agreement where they have the 2 Million Barrels per day cut. Perhaps we will see that impact on the price right now, it is masked by many things and mainly fundamentals and sentiment arent aligned in the market all right amena bakr, thank you very much. Have a nice weekend. As we head to break, a special announcement this morning and congratulations to our super advvi morning and congratulations to our super adving producer who w know well here and his wife on the newest addition to the family and Worldwide Exchange team arrival of weston angel driscoll we are told both the baby and mom are doing well once again, congratulations to jason and yadira on the arrival of weston angel. 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What, we have a ton of mulch. Its 5 28 a. M. Eastern time in new york city there is still a lot of with Worldwide Exchange left heres whats on deck. Stocks trying to bounce back after three Straight Days of losses investors looking ahead to the big july jobs report a very rough quarter for apple with the company now on the longest sales slide since 2016 the stock is moving lower ahead of the opening bell. A different picture for amazon a blowout quarter topping every estimate on nearly every metric there is the stock is surging on this friday, august 4th, 2023 you are watching Worldwide Exchange here on cnbc welcome back to Worldwide Exchange. Im domini