New investment restrictions tied to china its wednesday, august 9th, 2023, and youre watching Worldwide Exchange right here on cnbc. Good morning welcome to Worldwide Exchange. Im frank holland. Lets get you ready to start this day as always kick it off with a check on u. S. Stock futures. Right now were seeing them in the green across the board open up about 08 points higher nasdaq, more than a third percent higher in the premarket after a rough session for stocks yesterday. Investors digesting the moodys downgrade that sent major u. S. Officials sinking. Goldman sachs closing 2 lower, citi down 1. 5 and wells fargo jp morgan largely spared in this situation. This morning, were seeing a bit of a mixed picture take a look at how the stocks are performing right now in the premarket. Were seeing some of them still in the red as you can see, goldman sachs, jp morgan fractionally lower, bit of a rebound for bank of america, half percent higher, wells fargo up. 25 . Bond market, as always, start with the benchmark ten year. Yield right now at 4. 01. Ten bases points lower than it was a week ago also seen the curve decline. 30year tick up very slightly. Turning back to banks and developing story out of the europe italy appears to be backtracking on yesterdays surprise announcement of a 40 wind fall tax on profits of the biggest banks. Here is much more on this story. Good morning good morning, frank youre certainly right that story has been making waves across the night and into this Early Morning trading picture. It has turned from what we saw yesterday. This is the story. Italys finance ministry saying it will cap its planned wind fall tax to 0. 1 of risk weighted assets what it says is an attempt to safeguard. Analysts from citi saw the tax reaching this comes after the shares in italian banks fell sharply yesterday on that original announcement in that trading picture. It did hurt quite a few of these. Italys biggest bank yesterday losing quite significantly, back up 3. 3 to recover somewhat of yesterdays trade. 4. 5 gain for unicredit down quite substantially. All of these were down yesterday more than 3 gained across the board there. So recovery is in play the question is, just how much, frank. Thank you very much sticking with that overseas action, china reporting july inflation over night, fueling fears of deflationary problem in the worlds second largest problem. Eunice yoon is in beijing with much more on this story. Eunice reporter thank you a lot, frank. Unlike the u. S. And europe, china is struggling with falling prices for july, both for Consumer Prices and the ppi, we saw drops into the deflation territory cpi minus 4. 3 the ppi was slightly worse than expected the Consumer Price is a little better than expected even so, this has been fueling a lot of debate as to just how long we would see this weakness in prices. A lot of people have been pointing to the food and the core cpi for july which was the highest since january. So that strips out some of the food and Energy Prices also, china itself has been down playing the concerns, saying that Consumer Prices are likely going to tick up by the end of the year still, others are saying that the Services Inflation was a little bit better. Especially when it comes to tourism up by 13. 1 from a year ago. However, of course, the big concern is about the slump in domestic demand, especially ginn that the export figures were also very, very weak surprising many around the world about what this means both for the domestic demand as well as the demand for chinese goods overseas and frank, spelling a lot of trouble ahead for the chinese economy. Eunice, thank you very much eunice yoon live in beijing. Whats happening on wall street, founder, ceo and ci, of decatur capital and cnbc contributor. Great to have you here. Thank you good to be here, frank. I want to circle back to one of our big stories, the Financial Sector something youve been watching as well. Bank stocks dropped on the moodys downgrade. Over the last week, theyre still positive following that downgrade and some of the warnings downgrade of bigger banks like jp morgan and citi, whats your view on financials were actually in a recovery mode we had the stitch downgrade few weeks ago. Same thing happened with the banks. Same thing with moodys now. The banks will recover from this banks are still down some 24, 25 since the beginning of the year but we still think this is a time to get into banks were starting to really start to invest back into banks in this period. All right so obviously this week we have cpi coming up, closely watched inflation gauge by the fed what are your expectations for cpi, how do you see it moving the markets if it comes in hotter than expected looking at the cme, more than 85 chance of a pause. How much of it were seeing in the markets, limit disruption lately based on the idea we have reached the end of the hiking cycle . Frank, we have seen most of the hikes already. What we have seen is that we still have that sticky cpi that we really look at because the atlanta fed did a lot of work on the sticky cpi and flxable cpi the sticky is starting to come down so we could see that the fed could do one more or two more rate hikes were seeing the fed needs to control the sticky cpi its still at 5. 8. We want to get that down lower. Youre saying were near the end. But there could be one or two more. We have seen most of the hikes already. We went a long way. You dont think one hike or two hikes makes a big difference, is that what youre saying exactly. Very interesting. It seems like theres some stress on the markets right now, but if youre saying you dont believe that as we look ahead to today and the rest of this week, where do you see opportunities in the market well, we see opportunities is that were looking at International Markets also we see a lot of value. Lets talk about india we started talking about china and the problems there whats happening india, india is benefitting from that because theyre seeing relocation of manufacturing from china to india. You have strong, little class growth there, gdp growth there over 7 plus you have a Skilled Labor market so were seeing some benefits there. Icic bank, bank thats benefitting from that. Were looking at those International Markets because icic bank has really strong earnings expectations and revenue expectations Going Forward, return on tangible equity of 15 so we really like that stock. Looking for opportunities in india. Something to watch great to you here. Thank you for being right here in the studio. Time now for a check on this mornings top corporate stories. Our Silvana Henao is here with those. Good morning. Disney striking a 2 billion deal with penn entertainment and its bar stool sports books now known as espns bets starting this fall. As part of the tenyear agreement, disney will receive 1. 5 billion in cash and warrants worth about 500 million to purchase shares of penn the stock is soaring in the premarket hours. Well talk more about this deal and what it means for the Gaming Sector when we speak with the ceo of Parent Company of fanduel later this hour. President biden reportedly set to sign a new executive order today that will ban private equity and Venture Capital investments in some Chinese Technology companies dealing in chips quantum, computing and ai. The move is an effort to prevent beijing from developing cutting edge tech for its military, but critics argue it will have the opposite effect. And amazon is reportedly in talks about joining a consortium of other Technology Companies including intel and nvidia to become an anchor investment in softbanks arm ipo arm plans to lift back in early september, according to the reports, seeking to raise 8 to 10 billion, frank wmplgtsds could certainly be a big deal. A lot more to come on Worldwide Exchange, including the one word that investors have to note today. First, opec on alert as china dips into deflation. What that could mean for oil prices here at home. Plus, from 47 billion to 300 million. The latest chapter in the down fall of wework just written. Well have much more on that story coming up. Then later, getting ready for disney and what, if anything, this stock can do to get out of its recent slump. We have a very busy hour still ahead when Worldwide Exchange returns. Stay with us welcome back to Worldwide Exchange. Were watching the price of oil this morning you see its up. Wti up almost 1 , brent crude just a tick lower. These numbers come in this morning on the heels o that have weaker than expected chinese inflation data and growing fears of inflation taking over the worlds second economy, the news adding conviction by the decision by saudi arabia and russia to cut through september. They look to make up for the apparent demand. Give us a sense. I want to go through the cuts russia and saudi arabia. Saudi is extending 1 billion cut. Russia 300,000 barrels what does that mean for the Global Market . I think the saudis have been very, very clear theyre going to do whatever it takes to essentially get this oil recovery to remain on track through the end of the year. What i think is so interesting, frank, is with the chinese Economic Data out this morning, you would think that oil would be potentially softer. Again, i think it speaks to the strength of the saudi action in terms of supply cuts. So when it comes to prices, were seeing a bit of a boost this morning long term, is this could possibly push up to the 90 bucks a barrel range you always have to look at this china story that has been one of the head winds for oil, big expectation of china back like gang busters. The import numbers have been solid. Record numbers in june some analysts are saying its going into storage but a barrel off the market, a barrel off the market. So i think the saudis have been really resolute. The fact that they said they could go deeper is indications theyre very, very convinced they have this if they just continue with the cuts. Be clear, when you say import numbers for china, youre talking about oil imports. I think the issue is the question is, yes, we had record numbers in june. But softer in july for crude imports. They look good the first week of august the question is china is on a buying spree cheaper russian barrels. Are those going into storage some underlying weakness means these import numbers wont hold. Again, though, the data on chinese import has been sol it. Youre not concerned about china. I think were in watch and wait mode on china. Other people are pretty concerned. Absolutely. The Interest Rate story has been something again Holding People back theyre basically saying, look, we still have these existing macro concerns i think thats what opec is reacting to. Theyre saying, not out of the woods. Were going to keep these cuts going, particularly the unilateral saudi cuts. China is not the only area of concern. We have to look at the situation in ukraine following the collapse go ahead. I think this is a bigger story. Im jumping in right there, frank. Please. I think end of year the story we need to watch is what is happening in the black sea this is a broader commodity story. The russians pulled out of the black sea grain deal infacto embargo on grain exports. They started attacking Russian Oil Tankers in the black sea, trying to drive up tanker rates. Not get enough attention it should i think this is an evolving story in terms of geopolitical risk in commodity markets. Whats happening in terms of the black sea. So risk often leads to price moves to the upside when people have concerns. So, is this another factor that could push oil higher . I think this is something the white house will be concerned about. Again, remember the price cap policy, that was designed to keep russian barrels on the market at a discount if we start to see significant rise in attacks on black sea tankers, again, that will send insurance rates higher what will that do for oil prices this is an area of growing concern, i think, whats happening in the black sea also a food story as well. Absolutely, a food story. Broader commodity story. Whats your outlook when it comes to wheat prices . Obviously the ukraine region a big exporter of wheat. Whats interesting is we havent had wheat prices soaring in part because theres been an abundant russian wheat harvest the russians are taking out a competitor by blocking ukraines exports. But again, this will be something of grave concern as we get into the lasting story about basically taking ukraines exports off the market that will be a concern for big importers. Who is big importer of ukrainian grain, china it will be interesting to see what china does in response to this russian policy. All roads lead to china you know the question before i can ask it thank you for being here. Thank you for having me. Coming up on Worldwide Exchange, what apple plans to do with its phones that may pinch a number for a number of its users. Much more of Worldwide Exchange back after this. Turning to washington and the Commerce Department upgrading progress on the chips act signed into law one year ago today. They have received 460 statements for interest for funding to date and more than 230 billion in promised investment from some of those firms. A closer look at the chips act and the challenges that are still in its way reporter the 53 brake light chips act celebrates one year since being signed into law and Semiconductor Companies across the u. S. Promised to spend over 200 billion on chip manufacturing hubs even though no federal funding has been awarded yesterday. The Commerce Department is swamped with over 460 Company Requests and is hoping to start distributing funds by the end of this year. You know, im pushing the team to go fast, but even more important to get it right. Reporter much like silicon prauser where i am right now are able to begin construction without receiving government aid, but other Chip Companies have had to put their plans on hold until that chips act funding is dispersed. The back End SemiconductorManufacturing Sector operates on very thin margins that dont make it possible without the chips act support to do this. Reporter but as the shovels hit the ground to begin construction, companies are realizing how difficult it is to find labor. Work force is the predominant theme that all companies are talking about. The ability to have a work force that not only is passionate about semiconductor manufacturing, but theres a pipeline that continues to produce and grow talent. Reporter tsmc is the First Company to publicly announce theyre delaying their production to 2025 because a lack of skilled workers forcing them to fly in taiwanese workers. Their experience in the unique aspects of those tools is what were bringing a small number of taiwanese technicians in to support and provide assistance and the primary function they will have is to train and coach and mentor the work force in the United States. Reporter the chips act authorizes more than 13 billion for work force training. But it will take time to ramp up those programs and churn out skilled workers. Time now for your big money movers take two moving higher despite missing fiscal earnings. 27 Cents Per Share compared to 33 cents the company is optimistic about the outlook saying confident in its game release schedule and sees green chutes and the gaming industry zip recruiter tumbling double digits after reporting earnings above indications the company posting revenue that dropped by 29 and guiding towards another 34 year over year decline for the third quarter, citing ambiguity when employers confidence will recovery. And shares of wework plunging on a warning over whether the company can stay in business the company saying in a filing it has, quote, substantial doubt about its ability to stay afloat after losing billions of dollars building and operating global portd folio of coworking spaces wework is coming off years of head winds following failed ipo back in 2019 and slump in Office Space Demand during the pandemic the company hit its peak 47 valuation now set to open up the market with a market cap below 400 million still to come here on Worldwide Exchange, an exclusive with the ceo of flutter entertainment, Parent Company of fanduel on the heels of up beat earnings. Well be back right after this were carvana we created a brand new way for you to sell your car go to carvana answer a few questions and our techno wizardry calculates your cars value and gives you a real offer in seconds well come to you pay you on the spot then pick up your car thats it at carvana its around 5 30 a. M. Here in the new york city area. A lot more ahead on Worldwide Exchange. Here is whats still on deck, roller costar week for stocks. It rolls on as wall street adds Banking Sector fears to its wall of worries futures are higher. Getting set for disneys latest Earnings Report they inked a deal to get into the Online Gambling space. Italy backtracking on market moving wind fall bank tax. We speak about the Global Implication