In syria we will weigh the investor implications later in the show, Sam Bankmanfried tells his side of the story as the disgraced ftx ceo takes the stand. It is friday, october 27th, 2023 you are watching Worldwide Exchange here on cnbc good morning welcome to Worldwide Exchange. Im frank holland. Happy friday lets kick off the hour with the check of the u. S. Stock futures. The dow would open up 100 points higher its early this comes after another rough session for stocks yesterday which saw the s p 500 close at the lowest level since may falling more than 1 for the week, every major index is down 1 or more led by the nasdaq eyeing three straight losing weeks red across the board the nasdaq is the hardest hit. S p down 3. 5 week to date a big part of this is microsoft and alphabet losing on the week and shedding combined 190 billion of combined market value since monitor the entire market cap of comcast, salesforce, mcdonalds or netflix. We are checking the bond market with a look at yields. Tenyear yield at 4. 87 . The 2 30 is seeing above 5 . We are also looking at energy. The u. S. Benchmark wti at 85. 07 a barrel the middle east tensions elevating the numbers. Natural gas is the biggest gain up more than 3 . Thats the set up for the u. S. Markets. This morning is two stock winners. Amazon and intel impressing the street after reporting the latest quarterly results. You see both up big in the premarket intel up8 amazon up 5. 5 lets start with intel shares popping after the Third Quarter earnings that beat on the top and bottom line as sales fell year over year. As for the outlook, intel expects to return to growth in the Current Quarter and plans to cut 3 billion in costs this year here is Pat Gelsinger on cnbc yesterday. We were losing money. Operational margin was ahead of schedule we did better than we thought. Market shares are better importantly is the road map and our next generation and a. I. Attach right there is ahead of schedule lets turn our attention to amazon profits tripled to nearly 10 billion on the strong sales of cloud and advertising and retail andy jassy offering a bullish outlook on generative a. I. Opportunities and aws Cloud Business for the quarter amazon reported a 13 rise in sales to 143 billion. Profit came in at 9. 9 billion ahead of the street estimate with shares up 5. 5 . Despite the tech bounce this morning, the month is shaping up to be another tough one for investors. Indices down between 2 and 5 dow and s p and nasdaq on pace for three straight months of losses lets bring in senior equity strategist at federated hermes linda, great to have you here. Good morning. We were laying out the threemonth slide for the markets. According to your research, we should Pay Attention to the three months ahead i believe you are including october, but you say this is when we see a big rebound. Thank you for having me on this morning november is the best month of the year, historically, and moving into the end of the year, we feel positively inclined to the market we feel the s p could reach 4,600 by the year. We think the economy heremains strong this is what we want we think next year you could see Earnings Growth go toward 250 with a 5,000 s p for next year we are bullish going into the year and finding a lot of stocks on sale. You have a lot of information in the notes you have pce coming up later today. The estimate for core pce is. 7 that means the tenyear yield would be 1 higher than inflation. That is only half the spread histo historically that spread is normally 2 above inflation. Why is that meaningful for investors . Investors are hoping the fed will stop raising Interest Rates and well see inflation come down we think they will they may have completed the Interest Rate hike cycle now already. Maybe one more we could potentially see Interest Rates on the long end settle thin here. 5 to 6 on the tenyear yield is average what we saw this year is 60 of the moves in stocks is Interest Rate related it has to do with the term premium going up so much on the back end and historically the next year you see double digit returns on the stock market. If history is any guide, the pain we have seen this year is related to concerns, geopolitical concerns and inflationary concerns which should settle down into next year and good buying spot right now. I want to come full circle the back to mega cap tech with the magnificent seven. Take a bit of a downturn recently you have an ambitious target right now. How does the market move higher with the pressure on the magnificent seven that make up so much of the market . Of course, the magnificent seven was responsible for the vast majority of returns this year you have seen mixed results this year that is why the indices are coming down when beneath this, you see rolling recession and the average stock basically do nothing this year. What wite need to see and what hope to see is a breadth of stocks doing better. More stocks than sevening movinp in the market as people can see that we dont see recession on the horizon. The jobs market is good. Were seeing inflation come down we can look at many of the other sectors of the market besides technology and build them up there are bond sectors in the market better than expected gdp report yesterday pushing back against the sense we may be entering recession linda, thank you thank you. We turn to the middle east and developing story u. S. Fighter jets launching an Early Morning strike in syria linked to the revolutionary guard. The pentagon ceassays the u. S. S not seek escalation in any conflict and these strikes are separate from the conflict from israel and hamas we have global head of commodity strategist helima croft on our phone line helima, thank you for being here sdp here thank you, frank. This is a different situation interest israel and hamas. What is your take this syria is this thees can an legislation that so many are worried about this is one theater of conflict the u. S. Is targeting our revolutionary guard bases in syria. The bases have been used to attack groups in israel and attacked u. S. Fighters in the region we had 12 attacks on housing personnel in iraq and syria since the war began. The concern has been this would not remain a war isolated to gaza because the presence of revo revolutionary guard proxies. The situation with attacks on the u. S. Personnel in the region by iranian groups is worrying. If you look at the path of escalation, it comes through such attacks. Helima, you said something that caught my attention the question is is this one single theater of war. Is this making strikes in a different area in the middle east and is this two separate things we have seen oil prices come off a bit this week because of the view this is a more limited conflict if we were to see escalation, significant escalation, beyond the borders of gaza, i think that would cause investors to be very concerned and iran is the big subject of concern iran is a large oil producer they have targeted ships before in the straits of hormuz where 17 Million Barrels of oil flow through every day. Any type of escalation of iranianlinked groups and these were attacks on sites in syria any indication that iran is becoming deeply involved in the conflict is worrying to the investors and u. S. Government as well i want to touch on your wheelhouse Oil Prices Brent crude had crossed 90 a barrel the entire oil market moving higher how does this impact oil this is the concern for oil anything involving iran. Iran has not been afraid of targeting Energy Assets in the region before. In 2019, when the u. S. Ended exce exceptions, we had a series of attacks on the tankers in the strait of hormuz that combined the capability which knocked out the electricity grid there any indication that this war is expanding to involve iran in a deeper way is going to make Market Participants nervous. Helima, you just returned from saudi arabia with the summit which included jamie dimon and other business leaders. Give us a sense we will not rundown your resume. Give us your sense of the tension in the middle east you visit the middle east quite a bit. What is the general temperature . What i was struck by is the speakers on stage were to focus on the flow and vision 2030. There were passing comments about the war and the saudi finance minister called for urgent deescalation. On stage, the focus was on the enormous Business Opportunities presented by the saudi arabia reform effort. In the corner of the conference, there was concern about what are the red lines that could bring more groups into this conflict everyone is watching if there will be a ground invasion. That was something that could bring in hezbollah and concern was expressed about the attack on the u. S. Personnel in the gulf. Off stage, the question was what is the trip wires for the broader conflict helima croft, thank you so much for your time and insight thank you, frank. We have more to come on wo Worldwide Exchange, including the one word vinvestors need to know today and why the ceo of chipotle is mightier than the obesity shot and later in the show, Sam Bankmanfried tells his side of the story as the disgraced ftx ceo takes the std. 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Its not just possible. Welcome back the dow is up right now. It looks to open 90 points higher nasdaq is up 1 . Lets see how europe is shaping up as the trading day gets under way. Julianna tatelbaum is in the london news room with more on the early action happy friday frank, great to see you before i get to europe, let me h show you overnight trade in asia green across the board decent trade in the region industrial profits in china showing solid gains in the latest period. Shanghai up 1 hang seng up 2 . The nikkei 225 in japan rallied 1. 3 as for europe, we started out the morning on shaky footing over the last hour, things have turned a lot more positive positive momentum building throughout the course of the morning. Dax supis up. 50 similar for the italian market there is one patch of red on the board. Cac 40 index is down. 40 . We have seen a pullback in montcler and sanofi. It has been a big day for earnings in the stock market these are two of the biggest moves to the downside. Sanofi in just a moment. Nat west shares down 10 they are under pressure and halted from trade after slipping 15 . Trading has resumed after the uk bank downgraded the outlook. The regulator will look into the bank over potential regulatory breaches in the decision to close accounts belonged to the politician nigel ferage. And sanofi is a defensive stock in a defensive sector. Sanofi shares are on the worst level in 29 years. They are looking to increase higher r d and tax rate. The drugmaker is spinning off the consumer business next year in a move to focus on innovative medicines. Judging by the stock reaction, the news around downgraded earnings expectations for next year are trumping the news of the Consumer Health business spinoff. It is taking a book out of the other businesses like novartis frank. Julianna, thank you Julianna Tatelbaum live in the london newsroom. Time now for the big money movers three stocks of the morning. Shares of chipotle moving almost 4 higher after beating on the top and bottom line for its recent quarter held by higher menu prices for the Third Quarter with the net sales climbing 3 . The ceo says traffic trends remain strong in october helped by the return of carne asada and when it comes to weight loss drugs, he is not concerned really not seeing any impact on the business. The more we study and understand it, i think this is another place where we are positioned well our food is clean and cus customized you can get exactly what you want to eat. Turning to the Auto Industry shares of ford under pressure after the Third Quarter estimates following the labor strike that cost the company 3 billion. Ford pulled the Earnings Guidance which adjusted earnings between 11 billion and 12 billion. Ford will delay ev investment, including the construction of the battery factory in kentucky. Shares of ford down 3 shares of deckers outdoor. The maker of ugg boots is beating the top and bottom line estimates. You see the shares are up almost 11 . Coming up on Worldwide Exchange, betting on an economic reborebound. The 7. 4 billion bet my next company is betting on the transport space and the reason why were back right after this. when the day that lies ahead of me seems impossible to face a lovely day lovely day lovely day lovely day a bank that knows your business grows your business. Bmo. We earn your trust. Maintain our financial strength and stability. And deliver solutions that meet complex needs. Massmutual. Partnering with financial professionals, benefits brokers, and institutions. woman what would the ideal Weight Loss Program look like . Partnering with financial professionals, no hunger, no cravings, no isolation, more energy, lasting results, and easy. Is that possible . It is with golo. These people changed their lives with golo without starvation dieting. Whether you have 100 pounds to lose or want to shed those final 20, try golo for 60 days and never diet again. uplifting music welcome back to Worldwide Exchange. Stone d Stonepeak Partners is acquiring Textainer Group for 7. 4 billion. Under the agreement, shareholders will receive 50 per share in cash. Textainer says this will give access to Investment Capital and industry expertise joining me now in the first on cnbc interview is Stonepeak Partners chief operating officer luke taylor. Thank you, frank. Your ceo spelled out what textainer is getting in the deal what are you getting in the deal containers are how most consumer goods are imported to the u. S. We cited macro weakness and the weaker consumer. Why was this deal worth it for you . At stonepeak, we invest in infrastructure and real assets we look for businesses with quality and high asset backing and good barriers to entry and longterm cash flows durable and resilient cash flows with good Pricing Power. Those businesses tend to be companies which power the global economy. If you look at textainer, it is a worldwide shipping resource. We lease containers to 200 Companies Globally all of the shipping liners are our customers. It is a Critical Link in the Global Supply chain. That fits the mandate we put forward. We have durable cash flows in the business and great longterm Growth Prospects you mentioned Pricing Power con ttainer prices are 90 down from the high in 2020. They settled back to the f fiveyear average. Where is the rebound how high do you think these con ta container prices go up if inflation is increasing the cap x, the lease cost price is the box you mentioned you have global customers. Have you been in contact with the customers . You talk about container shipping walmart, nike, et cetera have you given a sense of confidence they will start shipping more things and bringing more things to the u. S. I want to ask how near shoring in the u. S. Play a part of this . Absolutely. Were a longterm investor if you think about today, global trade container trade is 175 million teu. A lot of talk about the globalization. I think it is slowing globalization. If you look at the next ten years, the onshoring trend and decoupling with china impacts 2 million of the 10 teu. You have emerging class globally which in the developed economies consuming more we look at the longterm growth about 2. 3 that 2 million you use from the decoupling from china and os onshoring, you will pick up more you have a big growth in asia trade as well. Something we will have to watch. One other thing, textainer has a right for a better deal. Luke taylor, coo of stonepeak partner partners. Thank you, frank. Sign up for the cnbc evolve global summit next thursday featuring leaders offering strategies necessary for adapting in the new era of business ill pspeak to a Global Leader from fedex just scan the qr code on the screen to register or go to cnbcevents. Com evolve. Time for a check of the Morning Headlines outside of the world of business with phillip mena in new york good morning, frank we begin with the aftermath of the shooting in maine. The town of lewiston is still locked down while the search for a suspected killer robert car