tv Worldwide Exchange CNBC November 1, 2013 5:00am-6:01am EDT
you're watching "worldwide exchange." i'm ross westgate. it's a lackluster trade for the first day of november after wall street had the strongest month of the year. the euro falls again, hitting the lowest level in 16 months. renault shares are shifting into lower gear as the carmaker's partner nissan cut its profit outlook by 20%. investors question rbs's bad banks. the uk government says it will make it easier to sell its stake when shares fall as the lender says it will take a 4 billion
pound impairment charge. and chinese backtrack continues to pick up in october. the pmi data shows smaller manufacturers may be struggling to keep pace. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. >> all right. a warm welcome to today's edition of "worldwide exchange." if you just joined us in the states, as well, welcome to the start of your global draid trading day. the ftse down 46 points. a lot of focus in rbs will come on to that. right now, down 0.1%. the xetra dax is currently down 0.2%. and here in france, the cac 40 is down 0.3%. we're focused on renault shares taking a hit on news from its japanese partner nissan. and so renault down 3.7%. nissan, down after the auto giant reported earnings and cut
its profit outlook for the year by 20%. nissan was expected to report its second quarter numbers tuesday, but moved the announcement forward. you can see nissan says down 2%. our tokyo bureau chief karen geogi has been in japan at the news conference. sony down 11% at the moment after the company slashed its earnings outlook, as well. head to our website cnbc.com to find out why some strategists are saying that time is now running out for the japanese electronics giant to prove that it can engineer a turn around of its struggling business. as for the rest of the chinese markets, the shanghai composite up by 0.3% at the moment. chinese pmi, 51.4 in october. up at a 17-month high. the official pmi, the hsbc numbers, 50.9 and low calling, as well, of money market rates
coming down, as well. in australia, the s&p index finishing the week down around 0.25%. u.s. futures, the dow is down 73 points. the s&p off 7. this is where we stand at the moment. the dow is currently some 26 points above fair value. up 2.75% for the most of october. the s&p was up 4% for the month of october. at the moment, it is trading 1.5 points above fair value and the nasdaq at the moment is around 6 points above fair value, up over 4% for the month -- sorry, up over nearly 4% for the month of october. bond markets, we keep our eyes on treasury yields around. that's 2.5%. they have gone a little higher. you can see 2.56, still pretty well contained. as far as currency markets, all the focus has been on the euro. we saw that inflation coming out yesterday. headline cpi, 0.7%. core cpi matching the record low for the eurozone 0.8%. and euro/dollar, over here for
some reason, 1.3534 is where we currently stand at the moment, having been at 11.3833, the two-year high last week. and we're still tracking above 1.3750 yesterday. that focus there at the moment. now, take a look at the euro seven-day, as well. that will sort of show you where we've been. the steep decline over the course of the week from that record high of 1.3833, as well. as far as the agenda is concerned today in the united states, we've got the october ism manufacturing index out at 10:00 eastern. analysts looking for a reading of 55, down more than a point from september. the st. louis fed president james bullard will be speaking about the economy and monetary policy at 11:00 a.m. and chevron reports earnings before the opening bell. we'll hear from cboe holdings and the washington post. berkshire hathaway reports after the close. now, as i engz mentioned, chinese factories continue to pick up their pace in october. both the official and the
private sether pmis rose to solid export orders. but there's concern that the recoveries are only being stopped by the large companies as the subindex lagged. joining us is louis core, chief chinese economist at rbs. louis, good to see you. thanks for joining us. are we quite happy about the sustainability and the strength of the chinese economy despite the concerns about the housing market and nonperforming loans of chinese banks? >> well, you know, i think china still is facing many issues, both with regard to the short-term outlook, also all these structural issues. but i think if you look at growth and where are we going in the common quarters, i think that growth will, overall, be enough efficiently above the government's own bottom line. that bottom line which is about 7%. >> yeah. so what are you going the look
for? what is going to be the most important data for you coming up? the kind of data we are looking at at the moment is on the credit side. we were expecting and still expect the government to start to reign in that rapid expansion of credit aggregate. we saw it happening mid summer. we saw it was going back to very strong credit numbers in august and september. that's why we're looking out very much to those credit numbers that will come out for october and november to see if that firm or monetary stance is happening or not. >> at the same time, we saw money market rates going up and over a couple of days the pboc pumping in liquidity to pump it down. what are they trying to signal inspect they want to firm rates or were they more concerned that things didn't get out of hand? >> well, you know, on the run
hand, they want to implement a firmer monetary stance. but that doesn't mean that they want interbank rates to move about a lot or to get very high. the interbank market is meant to, you know, show relatively smooth behavior of those interbank market rates. the say what banks use tore their functioning. the interbank market is meant to function smoothly. it's not in the pboc's interest to wreck havoc there. that's why we're a little bit intimidated. why don't we signal nor clearly what they're trying to achieve there and why don't they give us more comfort that it's not their aim to see those interest rates bumping around a lot. >> and look, this is the manufacturing pmi number we've had today. we saw iron ore imports in the last set of trade figures up at 17-month highs. and mining companies in australia talking about higher demand or production levels, as
well. are you comfortable there is going to be the continued demand for base materials from china support the miners, which have had a pretty rotten year? >> yeah. you know, this -- like this very physical part of the economy, like heavy industry and the commodities sphere tends to be quite volatile. we have seen that the construction industry, the construction of housing, you know, has gone up and down in the last two years. when we look at it in the common quarters, we think that the housing construction will remain pretty solid and that is one important driver of the demand for steel, for other materials. we see that, you know, as we saw in today's pmi numbers, more generally, the demand in the manufacturing industry is reasonably healthy. so i do think that commodities fear, you know, is supported by what's happening in china's own
economy at the moment. >> okay. thanks for that. have a good weekend there. >> thank you. now, it's friday. in case you weren't aware and you're probably counting the hours until you can unwind with a nice drink, if that's your thing. well, if wine is your simple of choice one might be out of luck. according to a morgan stanley report, china's growing thirst for the drink might be contributing to a wine shortage. coming up, we'll look into the details of rbs's plan. a different short of strike, as well, for french footballers is kicking off as francois hollande holds firm on his top tier tax rate. we'll cross to paris at 10:20
cet. and twitter's road show continues with the social media firm visiting chicago today. the company's set to start trading next thursday. but is the ipo price too conservative? we'll discuss that and plenty more coming up after this. [ female announcer ] what if the next big thing, isn't a thing at all? it's lots of things. all waking up. connecting to the global phenomenon we call the internet of everything. ♪ it's going to be amazing. and exciting. and maybe, most remarkably, not that far away. we're going to wake the world up. and watch, with eyes wide, as it gets to work. cisco. tomorrow starts here.
part nationalized financing rbs will be creating an internal bad bank to separate toxic assets from the rest of its business. that as the lender's sole losses narrow from a year ago. it announced it was setting aside another 250 pounds for ppi selling provisions. rbs warned of a substantial full year loss. it expects litigation charges to continue. our british business joins us from outside the rbs headquarters in london. well, not the headquarters, but anyway, their main office if london. helia, so they're not splitting it up. i suppose that's the big conclusion. >> yeah. i think as everyone expected, this is a big retrenchment from the original propoel posals, which as you can remember came from the banking commission, banking standards commission about splitting it into a
different banks completely. what's happened now is it will be an internal bad bank and about 38 billion pounds worth of assets will be put into that division. to have been mixed around. and essentially what that means is those assets will be sold off or run down faster. nothing changes from the shareholders perspective. but what should happen is that you get a quicker return to the private hand because those assets come off the balance sheets quicker. as you mentioned, shares are down this morning and that's probably because of two things. one is that we've seen that in discussions with the regulator, the pra, the bank has increased its capital to 12% up from 10%. what does that mean as a read across to other banks in the sector? will they also have to increase their capital allowances? the other thing is, as you said, the hit on those loans, that will be a hit of 4.5 billion that they'll take in the fourth
quarter. that's coming down. that's the impairment charge that they're going to take for speeding up selling down those assets and taking that loss now. now, the chief exec, ross material, was saying this is a new beginning. it usualers in a new relationship with the government and the regulator and apparently he's been around the corner on a bicycle with the chancellor as they stand shoulder to shoulder on this new chapter of rbs. an rbs that hopefully has less political interference because that has been the biggest problem for the banks. the other news is we haven't heard any more detail about the dividend access chair. remember, that's what share holds are incredibly keen on because it's stopped the bank from paying out dividends to ordinary shareholders before doing a deal with the government. they are in discussion, but i think shareholders will be very keen to hear about that, especially as we move closer towards the privatization, two
years maybe after the election now. >> all right. helia, for now, thank you. in a separate development, rbs has suspended two traders in connection with the global investigation into the possible manipulation of foreign exchange rates. in a statement, the banks said that it was cooperating with various governments relating to the probe. >> credit suisse is reportedly fired a trader over unusual trading activities. according to the "wall street journal," he was dismissed this week following a $6 million loss. the trades took place last year. his boss has also been suspended. and the president of germany's banking regulators pretty bullish about the country's financial institutions. this ahead of the ecb's asset quality review, despite a report from pwc earlier this week which suggested that germany has the highest amount of nonperforming loans in europe, a whooping 1.79 billion euros worth. we caught up with the bafi
president and started asking about her expectations ahead of that review. >> my expectation is that the german banks shouldn't have any specific problems. they're clearly asset portfolios, which will be -- will have to be scrutinized very much and which will be scrutinized in germany as well as in all of the other countries. so i wouldn't expect any specific -- i wouldn't have any specific concerns for the german banks within the asset flow review. on china construction bank says it's buying a. 73% stake, wert known locally as bicbanco. value at around $1 billion. but it's the first foreign takeover outside of hong kong. hahn lists view the deals another baby step by chinese lenders to becoming global players. and a recap of the headlines today, u.s. equities struggle for government shutdown.
october closes as the best third month of the year for the s&p 500. nissan unveils a management reshuffle, cutting its full year outlook by 20%. and a substantial full year loss predicted and plans for an internal bad bank announced as rbs shares fall. still to come, the french president, francois hollande, tells football clubs they will not be exempt from a 75% top tier tax. stephane is outside the stadium as the players plan to go on strike. ♪
french president hollande says he won't suspend the tax on player salaries. stephane is outside the park with the football play. ste fap, francois ohland has the lowest approval rating of any french president ever. if these clubs withdraw their football, what will happen to their fan base or their approval rating? >> you know, it has the lowest approval rating for a french president ever. but on that case, a large majority of french people believe that the club should pay
the 75% tax according to an opinion survey. more than 80%, 85% of french people believe that the tax is justified. and that is club should go ahead with this 75% tax on salaries above 1 million euros. the club claims that because of the nature of their business, because we have a lot of salaries over 1 million euros and that's a lot compared to the relatively small size of the club, so they should have a special stages and shouldn't pay this exceptional tax which is here to to last only for two years been they argue it could destabilize the economy and that ultimately they wouldn't be able to keep in france the star players. she could escape the country and go maybe to england and that's the reason why they were asking for a special status. they are going ahead with the strike on november the 13th, ross. there won't be any football games in france. it's going to be the first time for 40 years although the country is quite used to
demonstrationes and strikes. it's quite unusual to have this type of movement in the football sector. but even though francois hollande explained yesterday in a statement that the need is to clean up pb finances justified, fully justified the companies which are paying such very high salaries. over to you. >> all right. stephane, thanks for that. joining me now in the studio is peter bullen, europe i can't know stocker writer for "sports illustrated." peter, we ought to explain the way the taxes are arranged, it's not the players that pay the tax. i it has to come from the club the. it's a bit complex. >> that wasn't fair, so hollande moved it to the company that pays the salary having to pay a payroll tax. obviously, it's a strike against
the government. the players don't care. they want more money. but in a country where salaries are stag nating, it's -- hollande has the part -- >> it's the one policy he has where actually he's not being, by the looks of it, fairly quick. how does this compare with strikes we've seen in major sports in the united states? >> that's slightly different. there, it tend to be a lockout, a battle between the owners and the players. but essentially, there's a similar point here, which is that french clubs lost over 100 million euros collectively last year. a lot of that is represented by psg, who overspend like crazy because they have qatarry owners. but the business for the clubs are not to place themselves in the position to win trophies and they overspend. salary red sox taxes, luxury
taxes in the american sport help control expenditure. they're just not available to european clubs because capping salary would be against european law. so they have to find other ways. they're desperate. they need to control costs they don't want costs to go up. they're losing money, they're in trouble. >> okay. and what damage do you think this will do if they're on strike for -- how long are they going to strike, for two weekends or three weekends? what damage will it do? >> to their pore lar support? probably not much. they might have to repay some tv money. that wouldn't be nice. see how this strike will have an effect on hollande will get what it wants. they just look degreedy and stupid, i have to say. >> fair point. peter, thanks very much indeed for that. peter bullen, european soccer writing for "sports it illustrated."
let us know what you think about this, but with you know, are they going to look degreedy and stupid, these football clubs? e-mail us firstname.lastname@example.org. to remind you where we stand with futures right now, it's a fresh trading month, of course, and after the close yesterday when the dow was down 0.5%, the s&p 500 is also down 0.4%. right now, we are implied, what, by the s&p at 2.5. the dow jones currently implied 30 points higher and the nasdaq at the moment is around 7 points above fair value. for the month, the s&p up over 4.5%. and the dow up 2.75, as well. all right. we just have to keep our eyes on was going on in egypt. a gunman opening fire to the famous cairo hotel, which is on the road to the pyramid, clearly a tourist attraction.
we'll keep our eyes on that, as well. still to come on the show, the biggest tech ipo since facebook is expected to get under way next week. so how will twitter's offering go? we're going to get into that. all the details and more coming up. as we do so, european equities also starting the month in a fairly mixed sort of mode. plenty more to come in the next part of "worldwide exchange." right after this.
the british government says it will make it easier to sell its stake but shares fall as the lender says it will take a 4 billion pound impairment charge in the fourth quarter. plus, chinese factory activity continues to pick up in october. the pmi data shows a small amount of manufacturers may be struggling to keep pace. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. all right. we've had some data just coming out of the uk. the fastest growth in exports in more than two years helping british manufacturing grow solidly last month. it is the uk manufacturing pmi. easing slightly to 56 in october from the downward revised 56.3 in september. so manufacturing still growing strongly. although it is still around also around 9% smaller than before the financial crisis, unlike the
services sector, which has now recovered ground that it lost in the '08, '09 recession, as well. the contents of growth being seen in the manufacturing sector will still provide a major boost to the economy according to the pmi in october, as well. now, this is where euro/sterling is. 0.8456. core cpi now down at a joint record low in the eurozone of 0.8%. some people just having to recalibrate their thoughts post the fed meeting, as well. and with the ecb coming up next week about the relative dovishness and hawkishness of both those institutions. right, as far as the u.s. futures are concerned right now, this is where we currently stand. we are called higher. the dow is currently some 30 points above fair value. the nasdaq is just 6.5 points above fair value and the s&p 500 is around 2 points above fair value. that after falling yesterday, but still, a pretty good month
for equities. down nearly 2%. the s&p nearly 4.5. the cnbc ftse global 300 is currently down 10 points. european equities have been somewhat mixed today. and we're currently down 0.1% for the ftse. a little bit more for the xetra dax. the cac 40 is down 0.3% as well as the ftse mib, as well. twitter's ipo ratio is entering its final leg with the social media firm visiting chicago today before heading to the west coast. and eventually ending back in new york. pricing is expected next wednesday and trading then on thursday. patrick keen is president of share through and advertisen technology platform. he joins us from new york. patrick, thanks so much indeed for joining us. twitter is going to have an $11 billion valuation. is that easily justified? >> yeah, i think so. especially when you look at facebook's valuation. they're about 10% of facebook's
opportunity, but it's certainly not in the daily feed experience that i would think you'd see facebook. but i think that represents an opportunity for twitter. >> the cfo says the company has a big opportunity to increase ad revenue outside the united states. if you're investing in the company, is that what you were just hinting at is the opportunity? >> absolutely. i mean, twitter's average monthly user is about 77% of ose are outside the u.s.o become a more pretty profound w you look at the numbers of its actual users outside of north america. it's core based and headquarters. and what will this ipo do of twitter for the rest of the sort of tech ipo market? >> yeah. it's been mentioned before, this is the largest ipo since facebook. but i think what this is a affirmation of the opportunity in mobile. i think we've been saying for the last sort of six, seven years that next year is the year
of mobile. 2013 is clearly the year of mobile both for consumer and business users. and twitter, when you look at its usage, over 60% of its usage is mobile. over 60% of its revenue is mobile. facebook, its last quarter, did 41% of revenue represented in mobile. this last quarter, 50%. so this, between, is the opportunity and represents how mobile is the future for monetization. and this really is a mobile ipo. >> okay. patrick, thanks for that. good to speak to you this morning, patrick keane, president of share through. we'll get the pricing and just remind you on wednesday and it will start trading on thursday. we will have all the coverage here on cnbc and plenty more on the website, as well, cnbc.com. now, investor search for chinese internet stocks still appeared strong. shares of 358.com, a chinese variance of craigslist saw 42% in its ny trading debut. it raised $187 million. and not all u.s. listed chinese tech stocks have managed to keep
their early gains. online retailer light in the box is now trading below its debut price after soaring on its debut back in june. at 58.com, not the only company going public in the in the u.s., the container store priced its floated $18 a share thursday, the top end of an increased range. the retailer, which sells a variety of storage products raised $225 million which values the company at around $827 million. the container store founded in 1978 has 62 stores in 22 u.s. states and washington, d.c. it will start trading today on the nyse. and automakers are reporting their october u.s. sales today. the numbers will be closely watched to see how much the government shutdown hurt consumer demand. auto sales of the earliest indicator each month of consumer buying habits. it expects u.s. sales to drop 5% to 10% from september. when sales cool to their lowest level industrywide since april.
nissan is checking up its ranks after a big cut to its profit outlook for japanese automaker now expects to make $3.62 billion this fiscal year. that's down nearly 20% from a year before and earlier forecasts. nissan has been hit by weak sales in china. and the string of costly recourse. now it's number two executive will be stepping aside as chief operating officer. second quarter net profit was up 2% to beat expectation webs but operating profits slid 19% on the year. for more, we're joined by cnbc's kaori enjoji in tokyo. kaori, good to see you. what now? wa do investors make of what nissan has been saying? >> well, this is a very disappointing report card from japan's second largest automaker. i'm at their headquarters right now. the ceo of the company making a rare appearance at a first half result meeting because usually he wouldn't show up appear these kinds of things.
i think dmid admitting the fact, he used his words, that they are operationally soft. you mentioned the headline figures, net profit estimates being cut by 20%. there are a number of reasons behind this. i think primarily, though, it's the weakness that they're facing in the emerging markets where they had been banking on so much growth. specifically, markets like brazil, india, also china in that equation. and they also, as you pointed out, announced a management reshuffle where the number two man, his right hand man for many years is going to go. that is is the chief operating officer. let's first hear what mr. gohn had to say at this press conference. >> many of these changes were planned as part of the natural evolution of the company. and of the progressive rejuvenation of our leadership. we are also creating an organizational structure that will favor more synergy with our reliance partner. however, our slow performance delivery in the first half of the year required immediate actions to be taken.
>> i think you also have to take this report from this on their announcement today in light of the tailwind that many automakers here in japan are enjoying right now. the least of which, of course, is the weaker yen. here is the ceo that was telling us a year back, a year and a half back that how can you compete with the dollar/yen is at 80? now dollar/yen is 20% above those levels. so that reason is no longer there. but i also think you have to put into the equation that there was a lot of expectation going into this earnings season because, remember, when honda announced last week that they were not revising higher their full year forecast, there was a big disappointment in the equity markets. so a lot of the second tier automakers like fuji heavy, in that context, i think it means a little bit of a bigger disappointment than it normally would have been. i would expect some reaction in the share price on monday morning. >> yeah, we'll see. we'll see what happens. kaori, it's a late end to the
week for you in tokyo. but thanks for joining us. we appreciate it. kaori enjoji from tokyo. aig's third quarter profits up 17% as the company's core insurance operations improved. but the company's property and casualty unit still paid out more in claims than it took in. appearing on cnbc's closing bell, the ceo says the corporate was solid and he weighed in on the state of the u.s. economy. >> what's lacking is enough confidence to take risk toes create jobs. i think that's a big issue here. but people are maximizing what they are. they're not doing a lot of new things. so for aig, we continue to grow. we continue to grow across the board, both in the united states and around the world. but it's a matter of our clients are a little bit more cautious, but i don't know that this quarter or next quarter that you'll see any effect on our business materially. >> all right. aig down 3% in after hours. and in frankfurt, off 2.85%.
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the white house has been reluctant to release any definitive numbers as to how many people have enrolled under held care for the new insurance program. new documents may show why that is the case. joining us for more is mary thompson. mary, a very good morning to you. so what are these documents? >> i'm sure the white house doesn't want these out in public. but the house oversight committee releasing documents late thursday showing the health care program got off to such a slow start, only six people managed to successfully enroll in health care of govern on the first day. now, the documents state that just 248 people succeeded in enrolling by tend of the second day, october 2nd. the documents are notes that were prepared by the war room meetings. that's part of the center for
medicare and medicaid services, the agency responsible for the rollout of troubled website. the ccoio notes indicate direct enrollment through healthcare.gov want working for the first two days. the documents are unofficial. earlier this week, kathleen sebelius told congress she won't release official numbers until mid november. sebelius won't be back on capitol hill next thursday testifying before the senate finance committee. and washington will be receiving help from silicone valley as several top tech and internet companies including oracle, google and red hat will be joining the government's efforts to try and fix the problems with healthcare.gov. the site has suffered outages in the last week. those individuals will helped they are expertise in website reliability, stability and scaleability. and, ross, they certainly need that right now. >> yeah, they certainly do. mary, another story, it's kind of health care related.
i know you've run the new york marathon. it didn't happen last year because of superstorm sandy. it's back on again this weekend. i know an awful lot of brits who go over and run this. how big is this going to be, bearing in mind the cancellation next year? >> well, you know, it's interesting. the number of participants are going to be right around the same numbers they were last year, maybe a little bit lower. they've also seen -- they've seen a bit of a drop, though, and there's some feeling that there were bad feelings from a number of people because they came over here expecting to run the race because despite sandy, the officials continued to say we'll run the race, we'll run the race and they canceled two days before. nevertheless, i think you'll have anywhere from 45,000 to 48,000 expected finishers in the race that, of course, crosses through the five burrows of new york city. it is still a huge event, of course, but we could see slightly fewer participants than we did last year. and, of course, we are going to see increased security because
of what happened in the boston marathon bombing last year. and just -- boston is the one that i've run a couple of times, ross. i have yet to run new york city. just haven't been able to train for that. >> look, i don't -- i tip my hat off to anybody that runs over 26 miles. i don't know whether it's healthy, to be fair. i'm just worried about the knees and the joints. i mean, how long does it take to recover? >> you know what? the human body is capable of doing amazing things. it can run far more than 26 miles. i think it's great that anyone gets out there and i think anyone who watches these races, of course, is inspired by who they see out there. >> there's always some guy in a costume or a swimming costume or flippers or something. right. but you know what? as part of the security this year, ross, they are not allowing people to wear these bulky costumes because they're afraid of what they might be hiding underneath those costumes. so those out this year in new york city. >> mary, thanks for that. plenty more to come from mary on
the marathon today on cnbc in the states. also still to come, the u.s. equities weren't spooked at all in october. all three major indices up more than 4%. so what will november hold for stocks? we'll ahead to the cme for answers next. mine was earned orbiting the moon in 1971. afghanistan in 2009. on the u.s.s. saratoga in 1982. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation because it offers a superior level of protection and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve.
fluctuation within it, yielding slightly higher. and euro/dollar, we went up to a record high of 1.3833 last month. in the last two sessions, we took a pretty big decline. we saw the biggest daily decline in around 18 pose yesterday. or 16 months for the euro against the dollar. and as far as nymex was concerned, not a great month if you were long. it was down nearly 6%. top gold, that evened out flat over the course of the month. and, again, there was quite a bit of volatility within it. all right. as far as futures are concerned right now, we are called higher for u.s. futures. currently we're around 35 points above fair value. the nasdaq is around -- just under 8 points above fair value and the s&p 500 is just over 2 points above fair value. european equity markets right now are all down. not by much. the ftse flat, the dax and the
cac are down between 0.1 mers and 0.3%. joining us is todd horwitz, from optionsjoe.com. todd, always good to see you. so, look, stocks at the end of october having a pretty good month. are we now set fair to grind higher into christmas and holiday season? >> good morning, ross. you know, all appearances are that the market wants to climb higher. you know, you can make all the cases, the lack of growth, the lack of jobs for the markets to go lower. but no matter what, we've been able to climb the wall of worry. they continue to go higher. the fed delivered exactly what the street expected. we're right back here to 175 a support in the s&p and you'll probably see a little rally. it looks like the markets are going to try to grind higher the rest of the year. a some point, i would expect to see some sort of selling pressure, but certainly to try to fight the tape and the fight to chase -- it's hard to do so you let the market trait trade out. >> exactly what we expected,
they didn't do anything, but they didn't really mention the government shutdown and they didn't really get into how weak some of the data has been. so on the margin, they might have been the balance of risk changing slightly. >> that's for sure. i mean, nobody cared about the government shutdown. nobody cares about bad news. if you notice, if it's bad news, it was good news now. but the one interesting detail here, i think, might be changing is that the free money from the fed may start to turn into bad news because i think people are starting to finally realize that why can't the fed taper? what is the problem? what is underlying here? so that eventually might catch up with the market. but for right now, the ever and ending climb the wall of worry, everybody says, well, we're going higher and, actually, where else can you go with your cash right now? except into the equity market. >> you see, treasury yields, ten-year yields stick around these sort of levels between
2.5% and 2.6%. >> i think that they're going to start to probably climb, actually. i think we're in a pretty good base at 2.5%. i look for them to be, you know, running closer to 3% on a rarely quick basis wbl probably by the first quarter. i think yields are going to start to decline and i think we're going to start to see higher interest rates. i think this real low interest rates from the 20s to the 30s is going to dissipate. >> todd, whenever your weekend starts, i know you have a full day to get through, but have a good one. thanks for joining us right now, though. >> thank you, ross. todd horwitz, founder of averagejoeoptions.com. if you are in a shopping mood, here are a couple of stories for you. apple's latest entry in the tablet market hits stories today. the ipad is going onsale worldwide at apple stores online in every market at atm local. the device is 20% thinner and 28% lighter than the previous
ipad. and walmart is kiging off the holiday season a little earlier. the retail giant will begin offering online holiday deals today, underscoring that heavy discounting to cash conscious shoppers may result in the most tepid spending in four years. stores will have less time to ring up holiday sales this year as there are six fewer shopping days between thanksgiving and christmas. and the shopping season has begun with halloween yesterday. the amount of costumes, makeup, pumpkins, you name it that were spent fairly outrageous. that's just about it for the week on "worldwide exchange." next week, we will be back to a two-hour show because the u.s. changes their clocks, just in case you've forgotten about that. but that is happening, as well. you can always get an extra hour in bed. that's the good news. whatever happens, though, we hope you have a profitable day today. coming up next, "squawk box" and the countdown to the opening markets stateside.
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good morning. the dow coming off its fourth best month of the year. in global news, signs of a continuing economic recovery in china are helping to lift sentiment and our newsmaker of the morning, we will be joined on set for an hour by philadelphia fed president charles plosser, a hawk will spread his wings. it's friday, november 1st, 2013, and "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on
cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. and we are looking forward to spending some time with charles plosser this morning. that conversation will begin at 7:00 eastern time. first, though, let's get you up to speed on the morning's top stories. joe mentioned the markets and the bullish run we've had. the s&p closed at a record high seven times during the month of october. ending the month by about 4.5% up. if you look at the october 9th lows through yesterday's close, the u.s. markets are up almost 6% or greater. and with just two months left in 2013, check out the year-to-date returns. the dow is up almost 19%. the transports up by 31%. the s&p up more 23% and the nasdaq about 30%. pretty phenomenal year-to-date. if you take a look at the futures this morning, you're going to see some green arrows once again. dow futures up by