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tv   Squawk on the Street  CNBC  September 22, 2021 9:00am-11:00am EDT

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before the open. it looks like the do you may be up a couple hundred points meantime, make sure you join us tomorrow nice to see everybody. "squawk on the street" begins right now. ♪ good wednesday morning david fair, premarket pretty steady here, risk-on sentiment being driven by headlines on evergrande fed decision at 2:00 p.m cajun fears ease, and as -- >> plus media is in focus. disney warns of subscriber headwinds.
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viacom, cbs launching a new bu bundle, and brian roberts promising more partners for peacock. the shipping giant fedex lowering its -- evergrande says they'll make the payment on thursday. jim, is this the day to bay some materials? >> i think president xi, who is not president for life yet, basically overreached here he's decided to pay off domestic that's going to end the contagion. overseas, there isn't that much exposure to american companies what they're doing is making good the people who -- the individuals who are owed money when i say making good, it's a communist regime they can basically say, we're going to make it so these people didn't lose money. that will be very bullish.
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that will be so people say, we get it, xi will bail out individuals. so this 29% of the economy could be game one again. what i warn is there's 80 million vacant apartments. more vaccinationances than in new york state economy. >> 80 million? >> they have a lot of apartments. >> they have a lot of people, too. >> true. but there's certain people -- i love ignatius. his novels are good, but he's talking about the disturbing maoist turn, and he's talking about the things that xi has don't. how about the crackdown on gays? do we have to sell them so much that we have to, like, let them do that? is that all right? in the name of selling, what, sneakers let them crack down on gays?
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are you comfortable with that? >> no. >> i think it's outrageous, but we've got to sell sneakers. >> you're going to tell apple to move their manufacturing elsewhere? >> i don't know what to do i think you try to say to the government, listen, we have a bargain, we just wish you would do -- that you would focus on running a great country and doing well, but that this needless attacks are no good common prosperity is one thing civil liberties is another, and i think you have to at least try. i'm not saying they can succeed, because its a command economy, but i think xi has so overreached here, that it's painful to read what he does, and how we do need sales, it's a great country to sell, but we can't idly let him go by and say
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these things. >> who is the "we" >> the u.s. government. >> in cooperation with a bunch of other governments, i assume. >> europe, 25% of their products go to china. you never hear -- when was the last time the europeans talked about the crackdown. this is not about video games. this is a crackdown about behavior >> it's a human rights issue >> i'm very uncomfortable with just letting them -- >> it doesn't mean it's going to mean a thing i don't mean to be cynical, but so what? >> just because we're in the media does that mean we check our brains at the door. >> what you're saying is not something that's yet happened, so it's unclear to me what's going to say that. >> i know. i i know it's very hard to read that attack and not say, you know, i have to speak out on this not
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because i have someone in my family who is gay, but because i just i can't believe this is happening. we all say, hey, it's a crackdown on video games he bailed out the people who owned apartments that didn't come through, and now it's okay, we just move on. >> so that's it? the global rebound continues, commodities, industrials -- >> no, we have the ports issue it's interesting those who have been trying to get their ships around to the east coast, there's also a jam there. >> the supply chain issues are everywhere. >> did you read the fedex piece. >> i read parts. >> did you think it was funny? >> ans in riesible? >> and did they have an answer
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>> did they have an answer nothing that i found even r remotely sufficient. i mean, there's one guy at the end -- every single person asked, but at the end, jack war rents atkins said -- we haven't come close since fiscal 2016 to making the margins they've been saying they started call, talking about what -- >> you're rooking at the c.o.o. discussing the labor shortages >> tomorrow is labor day at fedex. they're trying to hire 90,000 people tomorrow. it starts with the nightmare about trying to ship something important, and how portland, oregon hub is running with approximately 65% staffing, so they had to sent it to other places to get it to portland that's how they start their
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conference call. we can't hire. is this a business >> jim, these problems are all over. >> endemic >> yes the inability to hire and have a complete labor force that you need to do whatever it is. dealing with inflation, all soldier -- and then supply change it's really carl -- >> i point out that throughout the conference call, the analysts are say there are many companies that have been able to expand their margins, but fedex is not one of them. >> why is that >> i think they're undercharging.
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>> make it shouldn't cost -- >> i thought that was high. >> to get it shipped or -- >> i asked it to be sent it's more than the suit. >> what is it? >> the tailor with the suit? >> what do you think this is nissan fedex is still not working the answer is, well, fedex is trying to keep prices down, so you don't spend $1,000 on a suit. >> i wonder, is powell going to start to give more voice to some of these >> no, he's -- >> every conversation you have, whether it's small or big business, and you must have it, too, my costs are going up, i can't find enough people i'm dealing with supply issues
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are you raising price? yeah, i'm raising price. >> if you have the solution to the pandemic, a lot of these things melt away some. >> why is portland 65% staffed don't you think that's covid maybe we're seeing a reverberation of the unemployment benefits being cut down that probably will help. we need people jay powell can't create people. >> i was talking to a sushi restaurant owners, he can't get sushi fish. >> why doesn't fedex have more 767s than 777s there used to be a lot of cross-border planes, but no planes are going anywhere. the cargo is on a ship, you know, the more expensive stuff used to be spence -- when you
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have a plane from shanghai to san francisco, those flights aren't really happening. >> meanwhile, you're trying to get a container. you're paying multiples. >> 10x in a year. >> so spend less eat at home, don't go out. >> it ties back to what jamie dimon told one of our affiliates internationally about what would happen in inflation truly did surprise into the next year. take a listen. >> they're indicating, you know, sometime november, give or take a month or two, tell the world they're going to stop tapering i don't know if they're going to describe it, the way it will take a year or something like that you know, that will all be fine if we have decent growth i think decent growth is far more important, than we keep on growing. that's the annex dote for all ills. >> that's not the sound bite i
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was looking for. >> i like it, though. >> he did say it's possible the fed could be pushed into a sharp move next year if inflation gets too high not saying it's going to happen -- >> if dr. gottlieb is right, it won't happen i think people aren't going to work. >> why aren't people going to work >> they've had -- i'm saying, give it a little chance here call me. >> yes mr. poult, first i want to know why you allowed renegade trading where guys made a lot of money -- >> you don't think -- >> let me finish it's a two-part question, mr. powell secondly, why have you let rampant inflation continue when you probably even yourself, have you been to the movies how much is milk and third, they're talking about restaurant prices going up, so
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mr. powell, you're a disaster. you want that? i just did that. i once said that to jerry brown when he was governor why are you trying to put a man on the moon when he was governor. >> that was his first time around. >> he said that's the most stupid question i've ever heard, and then people started talking about, cramer is a tough guy. eunice yoon is in beijing to give us an update. hi, eunice. >> evergrande's flagship property business said it will be able to make the interest payment on a local yuan bond, which is due on thursday the company said it was able to resolve the issue through private negotiations, but it doesn't specify exactly how that will be paid or when it's also unclear what it means for dollar bond interest payments, which are also due on
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thursday, or the potential impact for a broader restructuring. each so the development was able to lift sentiment, as you can imagine, when the chinese stock markets which wee roped. the banking stocks didn't so so well, especially those with a lot of exposure to evergrande. in fact, evergrande still owes about $850 million in coupon payments this year alone china central bank injected about $14 billion into the banking system it also left unchanged a key le lending rate for september, though there's been a lot of talk now, because of all these problems we're seeing in the property sector, that the central bank could move ahead with a rate cut as early as next month. we are seeing more signs of stress in the housing. there are now eight chinese cities that have told developers
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not to cut -- offer steep discounts on new apartments, in order to try to raise cash you can see that there's a concern on the part of local authorities that, if they do see more housing price declines, then that could hurt the value for a lot of current homeowners in their real estate markets carl >> certainly something the government does not want to see happen thank you, eunice yoon we'll take a break a lot to say to corporate-wise and of course we'll keep our eye on two ipos. we're back in a moment when traders tell us how to make thinkorswim even better, we listen. like jack. he wanted a streamlined version
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a few moments ago there were comments, saying that they are looking at -- that is, comcast -- partners outside the u.s. for peacock roberts says, when it comes to streaming overall as a threat, well, he says, the internet is more of a friend than a foe. all right.
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if you say so. comcast constituent hasn't recovered from the significant drop it took last week, when cfo michael kavanaugh gave people concerns about the subscriber additions, which is really the business here, and it was down over 7%. it came back a bit, but not much >> even though you pointed out that this happened last year this time. >> no, it happened in 2017 2017, four years ago, almost i hadically, andstrauss said the same thing at a conference. >> we're owned by comcast -- >> you are bought and paid for, man. you have owned >> comcast that hurts i sent an e-mail to citadel
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saying i'm not an employee now, david, listen to me. >> i'm listening. >> all i'm saying is comcast did come back after the 2017 hiccup. >> yes, without a doubt. and there were not a lot of comments to say, wait a second, things were taken out of context. it was john waldron conducting the interview. >> he's -- goldman has. >> david frost, he would have been in charge of m & a.
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>> i have of queen of england. talking about headwinds. >> sometimes back, but it's getting tougher, at least what he said, in terms of -- and as he said, i think what you can millions of subscribers. >> but some headwinds. >> look, i think he gave the bears something to chew on, absolutely ended up thinking they will get indigestion. the toughest was right at the end when he was asked about dividend buyback, and he used the term sort of in the distance future i would not have said that
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i would say it would be on the table, in a matter of time i wouldn't have used the sort of in the distant future. that was kind of like the line sometimes when you go, in the old days, and you might be on. i would have talk about how the cruise ships are going, and we focused on the distant future. hmm. >> let's hope not. we'll get cramer's mad dash and countdown to the opening bell take a look at the futures, as we once again try to hold a bounce on a bit of a sigh of relief from china. we're back in a moment
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reacting to some reassuring headlines, of course, the fed decision at 2:00 p.m. today, press conference at 2:30 you have industrials, copper higher, vix is down for a second day, now below 23. with the opening bell in about six minutes.
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all right. we have a mad dash you're going to do general mills now. >> i've always been a fan of jeff harmony he's made this company into a growth area, but david, you'll see the stock jump today he's talking about organic net sales up 2%. do you know, literally on september 8th, he was saying
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sales could be down one to three. so, in other words, september 22nd, first dahl of the call, on september 8th, he said things would be down. now he says that things are up you want to manufacture upside surprise, that is the way -- which is cheerios. >> yes, it is. >> so i think when you guide up less than a month ago, and you fool what is --, so you're not a believer in buying on the rally? >> i like pet food i didn't think the stock should go do you think when he preannounced but did things get that much bertbetween september 8th and today? >> no. >> he emphasized once again it's side that's very good i think general mills should never have been down after he said what he said, because on september 8th -- if you want to
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know when of the food companies has a legitimate chance of rallies and keeping it, it's not kellogg. i would like to think it's campbell's assume. not yet. it's general mills they have moved aggressively into pet, the biggest growth area, as people bought a lot of pets during covid and didn't to say them i'm trying to get two goats. >> okay. to eat what? >> they eat a lot of grass they eat the hair on your legs, too, but i'm going to rescue goats? >> you're going to rescue the goats? >> i am. what are you going to do with them where are they going to live >> i don't know. put them on the farm i bought with bitcoin >> nice. how about cows >> cows eat you out of house and home, but i used to have a couple longhorns
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you would to say the hay and it would land on their horns. oh, man, it was kind of one of those silly -- david, you are toast. [ bell ringing ] there's the opening bell the big board, it is the restaurant chain company toast the nasdaq celebrating it's fresh works to talk about the ceo, on "techcheck" today. both of them -- toast priced at 40, well above the -- >> it's interesting, toast does have very good growth, 125%. i wanted to ask you about the $225 million they just lost in the last six months. you know what? dave, if you keep selling, it doesn't matter whether you lose
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money. >> as long as you can fund that growth, that's about reaching, trying to increase the scale of your business and your total addressable market, which of course will always be enormous that's what the ceos always tell us. >> i don't want to throw cold water in the people around me, but this is in my wheelhouse, and we're not growing in restaurants, the costs are two great. this thole addressable market, they have an ever-changing number of restaurants. that's wrong second, you can football these guys. >> you can go to toast and say i'm going to lightspeed or square, or go to clover, and you can make these guys play ball. this is not a good business.
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they have to make money. i don't know how they can when the restaurants are so strapped. >> if your value proposition is we're going to allow you -- we'll be more efficient and therefore save money, why isn't that -- >> people don't have enough money -- a lot of restaurants, yes, they can save in the future, but right now they can't up front. >> they're not ready to make the investment that allow them to save -- you're not a buyer here? >> no, i'm not a buyer of this, because i have seen what you can do when you decide to -- when you literally say, hey, listen, i'm -- it's costing me x at the other guy. the only company that's been good at this is doordash, but
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they bought everybody who didn't -- >> you know what also we talked about yesterday? the second biggest gainer on the s&p right now. >> david was trying to get me to say something negative. >> i asked you the question whether the company might not be well positioned, given the decline in the property market in china and overall development. >> they're going to try to keep that property market in -- balls in the air, but i don't know what they're going to do when they have the -- the guys who own the bond. >> it's been a bit of a rebound. >> i'm interested to meet judy marks. during the height of the pandemic, when everyone is zooming, she's in front of people saying, listen, we will service, we will do this, do that her organic growth is extraordinary, and i think she's done a fantastic jobs.
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>> you want to talk about adobe? >> of course. >> the stock is down 3%. obviously they've had great growth, but tell me your thoughts on the quarter. >> so a lot of people are saying, that the moment that he arrived and said seasonality, wait a second, we're buying growth stocks, not seasonality, so that's a oops moment, where you think, i have to sell adon'ti. this has happened so many times, like every year, and what you've had to do is buy the stock between now and their max event, which is october 26th to 28th. it's been a great trade. this company is doing so well, the margins continue to be good. there's only one analyst that's negative everybody else raised their target the digital experience is fantastic.
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they say, it it finished down 22, so buy -- if anyone thinking they didn't put up a good quarter, it's simply someone that doesn't understand the juggernaut that is adobe. >> it's a six-week low here. so you're saying -- the other thing we heard this morning is it's not the typical adobe blowout. >> you know, three our four times i've seen the not-typical blowout, and a month labor -- the client list, by the way, was pretty much everybody. i like shopify
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i have to tell you the last appearance on "techcheck," that's pretty good here was last night. >> we feel good about the quarter, but more important we feel even better about the future i think people appreciate we're helping them not just with technology, but the people and processes. we will continue to do that in terms of the innovation that we deliver -- >> i think there's two thing going on here. one of the things is salesforce is talking about people learning how to code, do things in salesforce if you look at a young person's re resume, it says fluent in salesforce the second thing, even elementary schools, giving them their product, and they are working at companies, saying why
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don't we do it this way, david they are pros letizers david, i think adadobe, he does' play that way. he's honest, tough, rigorous and a winner. >> as weapon pointed out, the five-year chart sort of answers the question. >> i rest my case. >> are you going to give us time for jetblue? >> no, i was going to follow on the breaking story from yesterday. entain shares are up again this
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morning, almost 24 hours exactly since we told you, of course, of the offer from draft it kings to acquire entain you can see draftkings shares are -- as they try to negotiate with entain. the bit is 630bp there had beena bid male overall you're talking about a huge premium from where the stock was. more than double what mgm offered to buy the company for less than a year ago we'll see where it stands. as i tried to explain in my reporting, there had been trouble -- would mgm come back here no, that's not what's going to happen they're veg focused on their partnership here in the united
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states called bet mgm. as i said yesterday, in one of my final reports on this later in the day, they want to be in a position to potentially take control there, both economically and from a governance perspective. that's what they're salivating over they consent rights, they say, in terms of really being ability to block any potential buyer of entain, but they'll negotiate with draftkings. the question is how much it's going to cost everybody? mgm, how much will it cost them to buy what they don't own, but that's the key in one way here, and obviously draftkings is negotiating with entain in terms of a deal that entain will accept
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>> i'm sure people are saying they're talking, obviously the way it works in europe, you have taught me, it's entain that has to do the talking. >> and shareholders can eventually do the talking. they have an official offer by the 19th much october. it's different draftkings, is in huge growth mode, but not really making money. >> not unlike toast -- i'm not saying toast is toast. they're on tonight on "mad money. >> got it. >> but what draftkings is doing, cost of acquisition is high, but they are trying to dominate. it's hard to go up against casinos, because they have the natural infrastructure >> one key here in the technology, and how you would go about -- would you allow
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draftkings to continue to use that technology, so there's a lot of negotiating left to be done here. you can't really split that tech, but you can't conceivably allow most to use it. >> that's an important part of this, too. it's happening right now when gambling is very, very hot because of the football. look, i think it would be great if the deal is at a reasonable price. that was very impressive, by the way. when i tried to source this thing, it was like, are you kidding me faber has the story. i was like, great, he's my
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partner. speaking of deals, zoom -- >> all over it. >> a lot of people don't care that much about this story in the journal about the government review from a national security perspective. by the way, h.r. mcmasters is on that board, and a lot of people are like, come on. so what they'll do to top off the offer so that they actually got a favorable vote. >> my stepson works for zoom, so i have to say that up front, but i do think zoom has given you the right to not use the chinese server if you don't want it. i thought this was an overreach. the fcc comment seems pretty lame to me. >> i did not hear a lot of concern in the marketplace about that it's much more the focus on will zoom raise the offer and when will they do it
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>> and everybody just suddenly decided they don't like zoom speaking of secure, webex is security, but cisco can't make any headway. we don't have enough to buy. it's good. >> that's a two-month low here now, at 347. a couple different reports one is axios talking about add more boycotts off the heels of the journal series, and adage with a piece on inventory shortages affecting the advertise market >> ben dioff yesterday --
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>> marc has consistently critical of the company, but here's what he told jim. >> i believe in redemption, believe in pardoning i hope one day they'll make the change, but today, wow, it's not acceptable to see, this kind of behavior in such a large and important company like that. >> it's just plain wrong it's on there. this has to stop >> this is when mark zuckerberg has to come on cnbc and talk he does. >> that's not going to happen. >> how do you know that? >> i've been doing this a long time and i know how people respond. >> do you think he can listen to this man sake one of the problems is facebook >> he's not coming on with us. >> why i disagree.
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>> okay. i will be right. >> i'm with david. >> after the big thursday meeting he was with the state of, you're with david, too how about we invite him here right now? >> he's busy with that american flag on that board -- >> yes >> i think -- if i were him, i would come on, because marc b benioff is -- >> he does not mince words, and his birthday is this weekend >> happy birthday. he and i are in a good place we have nightly exchange of texts. >> so is his birthday the 24th >> i know -- it's the 25th
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>> what is the 25th? >> what do you mean? >> oh, sorry. the dow is up 200. good morning, bob. >> quite a crowd out there very boisterous, a lot of fun, talking to these people earlier today. six to one advance to declining stocks cyclicals are doing better energy, retail, tech, cyclical sectors doing a bit better, health care, some of the more defensive sectors lagging a bit. we're playing the rally prior to the fomc meeting, but these haven't been so reliable recently we're, of course, waiting for
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guidance before the end of the year what is the standard nonfarm payrolls trending upwards? we need more guidance. we don't know anything about the debt ceiling, whether that's a factor in their deliberations at all. meanwhile, while we're waiting, there is been a lot of technical damage 30% of the nyse is -- only 30% is above the 50-day moving average. only 48% is above the 200 day moving average those are long-term numbers which you're talking about the 200-day moving average we have a lot of momentum that's been lost recently. we're starting to get some earnings, talking about fedex, but the 200-day moving average is 4112 for the s&p 500. that would be roughly a 10%
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corruption here. we violated the 50-day moving average. that's the purple line the gray like is the -- guys have talking about fedex i think the key takeaway is simple -- labor shortages will persist into potential 2022. that's not a company-specific problem. that now seems to be a real problem with the entire country at this point, fedex seems to be the leading indicator for that one in particular. in the meantime, i mentioned toast. what a boisterous fun crowd to talk to this morning they did price bottom the ranges 21.7 million shares at 40. 34 to 36 the price target. another digital payment processing service, but again software continues to do well. same tess nasdaq we're ready for freshworks today. $36 the price target 32 to 34.
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this is a billion dollar offering that's at the nasdaq didn't quite work as well with aka brands this is mill len uses, gen-z fashion brands constitutionally the real price was 17 to 19 a few days ago. they loudered it to 11 to 13 some of their competitors haven't done as well the trend has been up recently that's a good sign recent ipos doing a bit better. as we go to break. look at how treasuries are faring ahead of the fed decision and press conference we've been watching yields closely this week with the china
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got multiple baskets of strength today material, travel name oz cay but it's mostly about energy at the top. s&p is up 20 poinlts on this wednesday morning.
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let's get to jim and stop trading. >> devyn's real yield is much higher than what it looks like they're going to offer a variable yield he's fabulous. that's the most undervalued stock in the patch so, play with devon. they're good >> very nice >> tonight i have mr. metta verse, unity i think -- you know i'm a big believe in the metta verse, david? >> yes
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>> and standard lithium -- you need lithium for batteries and that's a big depository in arkansas but unity is exciting. i think they have a premium model. and one day we're going to live in a unity universe. >> i thought it was facebook's metta verse. >> i'm told that's no good but zuckerberg will be here and he will defend himself >> let's geout there >> well, we'll take off line but we are going to go. i'm quadruple vaccinated and even i got gottlieb approved. >> it's a date if we can get a flight, which is increasingly difficult to do >> we're going to get there. >> we'll see you tonight, jim. dow's up 275 and we're about 14 points from
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august down to a seizeinally adjusted rate and that's right along expectations based on contracts signed in june and july. the supply of homes for sale, down to 1.29 homes for sale. that comparison has been shrinking for several months that was a 2.6-month supply, pushesing the median price to $677,000, up from august of 2020 the annual comparisons, again, are moderating, as they slow down and skewed by homes fell from a year ago but all other price ranges rose up 40% from one year ago the share of first-time buyers dropped to 19% that is the lowest since the start of 2019, when mortgage rates were higher, at 5% on the
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30-year fix. carl >> remarkable numbers there, dianna good wednesday morning welcome to another hour of "squawk on the street. lively at post nine of the new york stock exchange. got the dow up 322, trying to recover from yesterday's failed bounce china reopens to close a little higher and copper has just surpassed its highs for the week >> and of course, busy focussed on that fed meeting but in the meantime, we're 30 minutes to trading session. we're going to start with adobi. the company's risk new rising to a recoffered 1.9 billion as you can see they're down about 3.5% today plus stitch fix surblging after a surprise profit. topping revenue projections, posting revenue growth year over
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year don't misan exclusive with the ceo. starting at 4:00 p.m. eastern. we'll end with fedex posting a big mess on the bottom line, cutting its full year's earnings forecast as well i want to call this out, not only because you're calling this low and calling the broader transports lower as well but many times this is scenic given the fact so many goods moving in so many parts of the world, it is seen as a harbinger of the global economy first quarter operating results, negativelyfected by year over year increase in cost due to a constrained labor market ceo raj explaining on the conference call that those shortages result in extra parcel routing. you're talking higher costs on top of higher pay.
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and the holiday season looking to higher an additional 90,000 workers in the coming weeks and months as well the yields do continue to be strong so, that is a bright spot. implications here, even though the company is continuing to see those yields stronger and continue to move packages and goods throughout its network, you're talking air cargo tightness and a labor shortage, which you've heard from so many companies and shares trade lower too. >> their view is it's nice that the volume environment is good nice that the pricing environment is good but what if trade and industrial production and labor efficiencies don't get any better and what if the weather's bad? and fedex has never had a history of giving very aggressive guidance. they've been pretty
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conservative, historically >> they say it is not a high multiple, but it is 23 times cash flow, which does put it higher than it appears out there. >> but we're getting these results from fedex in term oafs how its fiscal calendar falls, it's one of the first companies to report an offer guidance that goes into what is essentially the next calendar year. this is an early read on 2022 and earn gsz pings in the next round of, i guess, earnings season but it comes on a fed day as well so, not only do we talk about things like supply chain constraints and how transitory those inflation numbers are but when you're talking about higher labor costs, that could potentially be stickier and certainly a harbinger of what we'll hear from other companies.
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>> investors will be hanging on every word from the statement and of course, chair powell will have a news conference this afternoon. what we can expect steve. >> thank you, dave the fed issues its statement today amid questions on its policy and potential conflict. the most likely outcome, a signal that it will announce its intention to wind down asset purchases while not actually amounting that it will do so as a result, the fed will continue a policy that many believe isn't solving the problem it's intended to address. more than 90% of respondents to our fed survey say they're not needed to help the economy or help markets function. meanwhile, the fed says they remain because it's not achieved its employment goals and chief investment officer says the fed's focus on employment is backwards.
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you can't have maximum employment unless you have stable prices, which we clearly don't. in other words, it may be making the situation wurgs. investors will focus on the so-called projections for rate hikes. they currently show only 17 of 18 members see a rate hike in 2022 just a few changescould move and spoof markets. our survey shows the expectation for one hike next year finally, fed chair powell, may face questions and coms about investment policies at the fed, which he's romsed would be reviewed after trade and holding by fed officials speaking of the fed, j.p. morgan chase diamond warning that it's possible the fed could be forced to a sharp move next year
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>> they're indicating that some time november, give or take a month or two, they'll tell the world they're going to stop tapering l and take a year or so. that will all be fine if we have decent growth. it's far more important than anything that we keep on growing. >> joining us this morning, chief investment officer, omar aguilar. i'm not asking you to read diamond's mind but why would you throw out a hypothetical like that, that the fed could be forced to move, maybe earlier than the dot plot suggests >> i can only say that obviously the fed is having these discussions inny about the dynamics, which is inflation and employment the labor market is this process of having supply demand in bal
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ngs. we heard from companies, as early as today, about the labor shortage and the lowdown of the labor market, as a result of the fiscal stimulus, unemployment benefits from the pandemic that has created a longer horizon for the labor mark toot stabilize. i think when you put that in context of what fed officials are discussing is if we go with the right path of employment, is inflation going to get ahead of us and they are comfortable letting the economy run hot and therefore will probably pay less attention to inflation pressures than the labor market. >> and all of this with a back drop of headlines about therapeutics, vaccinations of younger kids potentially coming. today it's remdesivir and powell
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say figure you control the pandemic better, some of the sticky issues regarding labor and pricing of goods would make their job easeiar. >> the big question in their minds and certainly the news will help in their decision, is whether or not the program has been as effective as they thought originally stability is still one of the on call mandates. but the source of the program doesn't necessarily get in the marginal utility and therefore, the news and the fact that they're getting to the process of solving pandemic issues, it makes it a little easier >> so, given the rough day we had to start the week on monday and the fact that stocks in general have pulled back somewhat from the record highs earlier in the month
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given all the, i guess, uncertainty and feds, how should they be positioning themselves >> we always encourage our clients to think long term and i would say market volatility and news we have had this week, they're basically an opportunity for investors to reposition their portfolio. it's interesting when we see the events on any day of the week because this is the only time we have a negative pript on the s&p. when you look at markets being roughly 16% and bond yields in the 1.3 level, thinking of long-term opportunities for rebalancing their strategies, i think is still part of what we tell our clients
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this is an interesting time because we're moving to the next phase of the cycle it's pretty much towards the end of their run and reposition them selves for what is coming ahead, which is potentially high rates and high inflation it's what we tell clients and start repuvisioning themselves. >> you know, it's always good. i think this is an opportunity to look at where valuations are. and yes, it will probably take more for people to start thinking about fixed income and take longer to get yields up to where the valuations look attractive it's still risky assets will have a significant edge going to
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the next 12 months, mostly as a result of economic gregt growth and it's still a pretty solid macro back drop. and even though fed officials in the u.s. and central banks around the world are in the liquidity out there, still risky assets, still have a component the point is what do you do, whether it was putting yourselves more in the secular growth area and that's what we're trying to do we're trying to get the bar bell strategy works secular trends will continue to do well and potentially higher interest rates and potentially flatter curve is something that needs to be considered >> bar bells are getting more and more popular by the day. good to see you. as we go to the break, take a
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look at the roadmap for the rest of the hour, including bitcoin, dipbug low 40 k for the rest of the month. plus, restaurant technology company, toast, making its public debut at the new york stock exchange ceo is going to join us and experts warning this quill likely impact the upcoming holiday season we have hu sw ila gehostl ahead. if you're 55 and up, t- mobile has plans built just for you. whether you need a single line or lines for family members, you'll get great value on america's most reliable 5g network. like 2 lines of unlimited for just $27.50 a line. only at t-mobile.
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existing home sales fell in august joining us to discuss the housing market is remax. you have a good state of the national state of housing. what are you seeing when it comes to overall, the markets that you followed? >> we've been in a red-hot real estate market and the signs are showing it continues and even though there's a seizeinally ajlsed rate from july to august, look at prices up year over year and so, buyers are still coming to the market very, very strong. >> is that the case across the board? >> obviously. in the early days we saw metropolitan areas suffer greatly.
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now, new york. 55% increase, perhaps, has to be put in context >> well, context for new york is interesting when you look at the number of transactions they've had 15% of transactions. i get asked what are the hottest markets? i think this is the first time in 25 years i've been able to say pretty much every market across the country is hot. boise, phoenix continue to lead the way in the year-over-year price increases. we had 36 out of the 56 areas that we look at, had double digit appreciation year over year >> we were looking at housing starts i don't know how much of this is it a result of not as many homes being built. and in part, that does seem to go back to something we talk a lot about, which is the price of raw materials. what are you seeing and/or
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expecting there? >> we have seen housing starts in single family come down 2.8%. but multifamily was up over 20% with permits up over 15% my take on this. i was ask whd it fell earlier this year, lumber futures and single housing starts fell by 9.5% i think it's delayed we have steel, concrete, and lumber we have a labor issue when it comes to new construction. so, we can't get it out of the ground fast enough the pipelines of supply have been restricted. and because of the housing shortage, i think builders are turning to multifamily knowing we need to get more families in homes. >> we see it in the numbers month on month in fact, first-time home buyers are getting priced out of the market certainly the demand side of the puzzle continues to grow,
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especially as more investors get involved how much is that exacerbating the issue? >> there are some reports, especially in the first-time home buyer price range are consuming about 25% of the market and that's going to be in the low to mid300,000s in most of the met rupallian areas where they participate when you look at mortgage applications, the highest they've been since april and that's been driven by fha and ba mortgage applications. those are generally speaking first-time home buyers they've been in multioffer situations and i think because of the historic rates that remain competitive, i think we're starting to see inventory open up, more of the first-time home buyers return because they think they have a chance >> appreciate the update thank you. >> my pleasure coming up after the break,
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restaurant tech company, toast, going public ceo joins us
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welcome back to "squawk on the street." a $20 billion ipo priced well above its range. and joining us along side our own kate rodgers congratulations to you >> it's great to be here thank you, cnbc, for having us and what a great milestone for toast. >> let's talk about toast and talk about the numbers before we get to the technology. the capital you're raising today, what will it do >> it will unlock more money to invest ahead the restaurant industry has been going through a massive transformation in many ways, we feel like we're an extension of r&d for the restaurant industry. we're going to put the capitol to work and allow the restaurant community to thrive. >> i mean, initially when we saw the pandemic set in, the
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restaurant industry was hit hard toast was too but then you were able to surge back and we've seen other restaurants adopt your technology. i think revenue for the first half of this year doubled. that said, your loss also widened. in terms of the break neck pace of growth, are you sustain it and what does the path of profitability look like? >> we breve we're in the early stages of transformation for the industry 860,000 restaurant locations in the u.s. alone we're investing ahead to drive that innovation, drive that transformation you're going to see us continue to have the growth mindset and we're lin markets. boots on the ground, building relationships with restaurants driving our product transformation and allowing customers to be super happy once they subscribe to our platform
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>> thanks for being here and congrats on the ipo today. >> hey, kate, good to see you. >> good to see you to. so it connects front and back of houses as well as delivery platforms. where do you see the biggest disconnect in operations >> well, it's across the board if you're running a restaurant today, you've got three things top of mind. number one, how do you drive more revenue in the door and riit's all about increasing same-store sales number two, streamline operations restaurants are amazingly complex and we help them streamline their operations. and number three, they're trying to help them delight their guests, whether off premise or on premise we help them look at those three different dementions and empower the entire restaurant community with the simple unified
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operating system that connects the waiting to the guest to the chef to the stupupplier and we' doing much of that at a scaleable level, helping rest raubt -- restaurants across the region run a much better business if you look at toast customers in the last two years, we're proud to sigh they're performing at or above the level they performed in 2019. >> that's certainly great news and the platform itself is very interconnected through the restaurant i'm wonder figure you could talk about the spread of the delta variant and any changes you may have noted >> when we look at the delta variant and covid in general, we feel the industry has been battle tested with the covid pandemic and the industry and toast are amazingly resilient.
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so, we feel while delta may be dampen things, this industry is in recovery and we couldn't be more excited to lead the charge ahead as the industry recovers and restaurants start to thrive again. it's been slow but we're getting there and super kited. and this is an industry transforming for the past decade so, we're even more excited to allow the industry 92 ovate further. >> i imagine when it. >>s to point of sale systems, some of the other competitors as well how competitive is it right now and is there room or opportunity for relationships? >> you're spending about 2.7% of your sales on technology
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$27,000 spent on technology and restaurants are peanut buttering that all over the place b tween horizontal solutions for payroll, point solutions and the owner/operator is forced to play a coo, when they just want to run a great restaurant we compete against legacy, point, horizontal. but often we win because, number one, our product has depth and breath that's restaurant specific number two, we're obsessed with customer happiness we have feet on the street in all major markets, building relationships and trust. and number three, we continue to innovate ahead so, while there's competition, we're seeing good traction and we win the majority of the time when we're in a decision >> chris, we've seen restaurant chains and i'm curious if there's been hesitation from older, more independent
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established chains to come on bo board and embrace technology in the same way >> great question. there's a variety of inenvironments we're proud because we support restaurants of all types, sizes and formats more than any other competitor we're seeing really good momentum in s and, b, regional midmarket and the lower end of enterprise we believe it's a long game and excited to support them over time but we're not in a rush to close those yet. >> we look forward to continuing to talk to you about that. we appreciate your time joining us today as toast goes public
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$40 ipo price in what is a busy day for ipos and thank you so much. >> thank you so much rahel. >> good morning. and here's your cnbc update at this hour. netflix is acquiring the entire catalogue of a famed children's novelist doll. doll, fames for works like "charley and the chocolate factory", and "matilda" has sold more than 40 million books worldwide. and john and jenny paulson split. net worth shy of $5 billion. and raising the bar for policy makers in its first update to air quality guidelines in 15 years, after the u.n. released its revised guidelines earlier today. it's a leading topic in new
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york and the u.s. buying an additional 500 million doses of pfizer vaccine this brings the total number of donations above 1.1 billion. and president biden has the goal of contributing tohe t world's pworld's population from day one to graduation to your dream job, that's why we're keeping your tuition low for the 10th year in a row. - [student] the affordability and the quality of education, it can be enough to change your life. - [announcer] as a nonprofit university, we believe in making college more affordable for everyone. - southern new hampshire university, it was just amazing experience. - [announcer] find your degree at
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sec chair genzler, heefrz what he said >> public money has certain place around the globe, private money's usually don't last that long so, i don't thik there's a long-term viability for five or six,000 private forms of money history tells us otherwise
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so, in the meantime, i think it's worthwhile to have a investor protection regime placed around this >> joining us to discuss from hong kong, crypto cofounder and ceo. you said in the past that, as an industry, you welcome responsible regulation i assumia don't welcome calls that one day crypto seizes to exists >> i think the industry is too large to be killed by regulation to date. i do believe regulation is necessary. the bottom line is markets need clarity and consumers need protection >> what kind of protection >> crypto's a globally-regulated business we have licenses in multiple jurisdictions and have the largest crypto visa card program.
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we follow the same rules the banks follow everything and anything you would expect i think the question here is, and it's remains to be seen, whether regulators in the u.s. choose to regulate with surgical precision and disrupters and customer benefits or are they going to regulate to protect incumbents >> have you seen any evidence so far that moves towards regulation or kaulz for more regulation and end up eroding or degrading acceptance on the retail side or the institutional side >> no, i don't think so. again, we have taken a view this industry will be -- and we have a solid foundation of cyber security it will continue in the next couple of years. it's the reality
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you need to operate within regulatory frameworks. >> it's morgan note cnbc is reporting that robinhood is launching cryptocurrency. it seems like a very competitive landscape. i realize we're having a discuss about regulation and that could change and shift the landscape but what does it mean for a company such as yours? >> we, we think, broadly used platforms help drive value and you want to go deeper, you go to a specialized platform, like crypto and more powerful
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features >> we keep talking about the over lay between sixers and sports i wonder whatio make of that and what it brings to you is the league and the teams and it's not just basketball. and do you worry over time t dp gives a petina of gambling, when you're trying to be taken seriously as an asset class? >> the way wooi we approached it is we have a global strategy we're partnering with top brands in sports. a crypto partner of the usc. milan is arguably the best football team in the world today. and we're thrilled to partner with 76ers, who are young and with championship potential. it's -- we want to drive
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adoption of crypto currency and there's no better way than to put it in front of billions of people who watch sports every day. >> that points to sports as a marketing tool, no doubt about that thank you very much. >> thanks for having me. as we head to break, we're tracking a bit of a rebound on chinese listed companies you can see some of the biggest names there. this after evergrande does seem to be calming fears. a very big mega cap listed companies are having a good day. although still tracking for weekly declined.
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getting closer to session highs. dow's up 353 yesterday's interday high on the s&p was 43.94. we'reen the cusp of taking out yesterday's highs. energy contributing more at the moment up 3% and that's going to be your leading sector. supply chain bottle neck issues are having issues along the ports. it could impact the upcoming holiday shopping season. joining us now is ryan peterson. thanks for being back on with us this is such a key story that touches so many different industries and companies and consumers as well. in terms of the historic congestion, what are we seeing and what is it going to take for it to ease >> so, you are seeing over 70
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containerships waiting at the port of long beach, but there's actually over 130 containerships waiting at u.s. ports. so, the east coast has traffic congestion seattle, you're seeing more things and it's worse than that if you go to china, 90 waiting in shanghai. what it means is we estimate around 20% of all the containerships on the pacific ocean are waiting, idle, unable to unload. what that means is massive delays i think a lot of companies are going to miss christmas season because their cargo is sitting in the water if you reduce the supply of shipping that leads to high prices and it's just kind of a mess i think businesses are going to struggle >> i mean, 20% of ships, you're talk about ships carrying thousands, in some cases, of containers full of inventory and goods.
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what is this doing to freight rates right now? >> long-term rule of thumb is usually $2,000 more like 3,000 if it's door to door from asia to the united states right now the rets are 10,000 just port to port and much more for the rocking. so, more like 15,000 and that's if you can get loaded. even if you pay those prices, you may not find a slot and you may be delayed for months and months if you want guaranteed loading, it's more like $20,000 so, astronomical inflation in ocean shipping freight rates >> this is a world-wide emergency. i just wonder what can be done, if anything, through cooperation through governments or shippers, i don't know what would you have done to amealierate a significant
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problem for the economy? >> i think there's a role for government to step in. there's simple things because it's hard to motivate, hard to move but there's simple things companies can do right now technology platform -- and one of the things we've looked at. we ship over 100,000 container as year. we see on average there are only 70% full there's empty space inside the containers and companies being smart on our platform are starting to stuff their containers and using every inch of the container on the inside it doesn't take a lot of work. i'm not sure that solves the problem. we're talking about something that's big, macroscale right now the ports are not working 24/7 in the united states someone needs to work the night shift. i think the union needs help i think all there's a role for government to step in and say look, we have to unload these ships.
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it's putting our economy at risk and the union needs help not enough workers, the contracts for overtime are making it uneconomical for the port and the government has to step in and say we're going to run this 24/7. we'll pay it, we'll find a way it's way in over my head to even comment on it but that's got to be the solution at this point. >> but it's funny we don't talk too often with you about your company. it's a private company right now but has a significant valuation in the private market. i would assume much of this is good for flex port, is that right? >> it's hard to say. we're struggling to meet customer demand partnership. our customers are suffering from high prices and slow delivery times. we pride ourselves on being a customer centric company and not just us. all industries and trfrankly, it's hard to get
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capacity to serve their needs and grow it's put a cap on how much we can grow this. we had to turn away a volume that would have groin us 70% we could have got the space. >> and it speaks to the ripple effects. truck driver shortages in the u.s. and it's rippling to the rails and you're seeing a turnover in those too. fedex last night saying air cargo capacity is going to be constrained until at least the next half of next year if we continue as we're going now, given the infrastructure and dynamics in place, if governments don't step in, how long is it going to take for this to be eased >> it's certainly got to go through christmas. it always goes up. it's peek season so, there's more containers piling up. you have to at least get through that there's a chance that, as consumers get back to different
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spending habits, stop buying so many things he, spending more on services that see a decline in demand but at the end of the day, it's very unpredictable how it plays out >> so, is it going to get wurbsz before better or is this the worse of it? >> i have bad news for everybody out there is we're going to have a contract negotiation on the west coast for the longshoreman's union, for the people who unload the ship and contract negotiations are always difficult. five years ago, you had a strike that lasted five months. these things are hard to predict. but it's pretty ugly >> ryan peterson, thank you for joining us >> thank you for having me >> coming up on tech check, don't miss the leader of freshworks coming up on the nasdaq
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and session high-rise close to it s&p gainers, led by mgm, united rentals, often seen as an infrastructure play.
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welcome back to "squawk on the street." time for our etf spotlight ticker xlc it's about flat right now. top holdings include names like facebook and alphabet as well as media names such as netflix. raising price target on that stock saying it sees the company accelerating subscriber growth over the next six months shares up 6.5% and also that deal we'll be right back. stay with us ♪ ♪ ♪ ♪
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your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit cnbc out with its first ever delivering alpha investor survey with participants showing they are getting nervous about the stock market leslie picker has more of that for us >> cautiously optimistic i hate that term but the best way to describe investor sentiment from our new delivering alpha survey. we pulled money managers on
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where they stood on the markts for the rest of the year investors are cautious because 76% of respondents now believe is the time to be very conservative in the stock market versus 24% who believe it is time to get aggressive that doesn't mean investors think the markets are going down over the next year in fact, their optimism stems from the majority of respondents who said the s&p 500 will go up more than 5% over the next 12 months only 5% said the s&p 500 would fall the rest said it would be little change so, little risk appetite, but not expecting much in the way of down-side risk so, how exactly are investors playing that well, when asked where they are increasing exposure about a quarter said equities but the majority 53% marked some kind of alternative like private equity or hedge funds or real estate. only 11% want to fixed income.
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financials, technology and engineer are poised to outperform while utilities are likely to be the big underperformer for the next 12 months a reminder that cnbc delivering alpha is one week away and enjoy some of the biggest names in investering at deli >> my expectation would be when polled fairly conservative i don't know what theb numbers would look like. we don't have something to go back to in years past but talking about they're risk adjusted, right, leslie. you can't judge the returns anyway because they risk adjust so well. >> they do risk adjust so well it's a good point. when you ask them, they say, oh, no, we shouldn't be benchmarked to the s&p 500. we should be benchmarked to something else it will be really interesting to see six months from now a year from now how these assessments
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change over time because, yes, on one hand they're conservative, but on the other hand they're not really pairing back in the way of equities, at least from what we can garner from these surveys so, definitely kind of a mixed reaction from investors who responded here >> yeah, we were counting down the days to the actual conference itself, leslie. but you have sat down with a number of high-profile investors, as well given the conversation and the survey results today how some of the headlines from some of those discussions dovetail into this >> yeah, no, that's a great question, morgan we have been sitting down with some key members in the investor community ahead of the delivering alpha conference for our delivering alpha newsletter. we sat down with mark rowan and we talked about the markets and he said he believes things are priced to perfection and operates in the alternatives world which has a pretty strong pitch for investors that are
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feeling like the market is a little hot right now and looking for some diversification in their portfolio, david >> yeah, without a doubt of course, insurance a big part of their overall business , as well leslie, thank you. speaking of that broader market, we have the s&p 500 up 1% let's call it right now as we get to the end here of "squawk on the street. it's time for "tech check." good wednesday morning welcome to ""tech check." i'm carl quin tarx nilla we debate the effectiveness of their oversight board. netfli


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