make one bad decision. that's all for this edition of "dateline." i'm craig melvin. thank you for watching. ♪ good morning welcome to "street signs." i'm joumanna bercetche >> and i'm silvia amaro and these are your headlines. banks buckle under earnings misses deutsche bank bucks the trend. the cfo takes us through the numbers. >> pre-tax profit of 5.7 billion is a high. we grew year on year despite numbers that created noise this

year what is really exciting is the momentum. shell launching a $3.5 billion buyback program as full-year profit is $28 billion beating expectations. >> whether it is the strong delivery on cash flow or the improvement on the cost reinstructions or the capital discipline or the enhanced shareholder distributions, all of it is coming through. we recognize there is more to deliver. european equities moderate despite losses on wall street after fed chair jay powell pushes back on the march rate cuts >> we will look at the meeting based on the meeting today, i will tell you i don't think it is likely the committee will reach a level of confidence by march. and volvo races to the top of the stoxx 600 after announcing it will stop funding

polstar. the ceo strikes a bullish tone to cnbc. >> a lot of hard work and the foundational work allows us to have a strong 2024 and beyond. good morning yesterday was the major focus for the investment community with the fed meeting after the fed chair disappointed ins terms of the potential to deliver on the march rate cut that was a key market for markets yesterday. we look at the bank of england meeting today. we are tracking earnings this is super thursday with lots of names with results. you can see it is a mixed bag. we have deutsche bank in the money. those names are trading in the green with julius baer up 3.3%

the german lender reporting gains after the drop of fourth quarter profit and raising revenue outlook. on the flip side, look at the price action for ing 9.4% weaker. bnp as well down 8.7% in trading. heavily in the red the french lender reporting a lower than expected 3% jump in full-year revenue and trimming the profitability target for the year we will dig in with the ceo interviews throughout "street si signs" the rest of the show. one name is standing out this morning. shell is up 2.4% >> let's discuss shell earnings this morning the company reported a $7.3 billion adjusted earnings for the fourth quarter beating

forecasts after the poboost from the lng trading division we have steve sedgwick with us >> it's a privilege. once the anchor and now the reporter and then the reporter and now the anchor this is the moment it is a privilege. i deparidn't know we have so may around the desk. let's get arabile in here. >> when it comes to shell? >> i don't want to overwhelm you with numbers you hit $7.3 billion of net profit down from a year ago we have a lower oil price. there is self help in the industry you see from the share price up 2.3% on the day that is negative as joumanna was saying risk asset off the table with the fed decision pushing back on march. people are looking at the corporate stories and seeing what they like in shell. a couple of other numbers. it was about shareholder returns for some people coming into this as well.

they delivered on that they had a $3.5 billion share buyback in the third quarter which completed about the 1st of february, today. they feel confident enough to up the divvy again 32 cents per share and up over 33 now .34 dollars per share. completing that increase another 4% increase. cap ex in line with expectations that represents 10% of shell market cap 10% of market cap in total with the shareholder distributions. we spoke about a lot of issues and the big issues, including politically. i spoke to the ceo to discuss the business and broader energy environment and potential red

sea disruption >> we monitor the situation closely. we are seeing challenging in being able to, of course, cross the red sea. our focus is to make sure we honor our customer commitments through mechanisms swaps around the cape. it is more accentuated for oil products more so than lng and crude where the infrastructure allows that to be balanced for oil products, you are seeing a bit more of a squeeze, in particular into europe capacity in the u.s. is relatively tight and you are not able to bring the asian flows in >> why are we not seeing a price response a couple of dollars, but the most tame oil pricey have seen in a long time i just can't help think it is something about broader demand what do you think? >> we see demand continue to hold and be resilient. steve, 2023 has been resilient when you look across the path.

the u.s. is on the upside at the moment the issue is the uncertainty and supply there are different forces here. questions around opec and if new sanctions with crude out of iran and venezuela and tightening enforcement might reduce flowing from russia. questions around shale and the growth of shale. you put all that together and you are starting to see a bit more uncertainty in the market and these why people are a bit more tenuous of course, volatility for us is also an opportunity. shell is the largest trader in energy we continue to look at those for value. >> final question. we will get a lot of volatility with the elections and politicians. who knows who will be in the white house or downing street, et cetera. how concerned are you with the political process and the policy for 2024 >> of course, we are investors

that look at the very long term. every single one of our investments will break even in six or seven years plus. therefore, we are looking through individual elections and the institutional strength of many countries i think one area we will continue to look at is investment and the green commitment governments have toward that and whether they will continue to support the ecosystem that is required to be able to make those significant investments. that is an area we will watch closely. >> we talked about other things as well with the various parts with the mix of renewables and low carbon he talks about low carbon. i say what about renewables. the standout performer is lng. l lng trading was a real star. >> that was his background

he came from the lng background. interesting to see he is really leaning into that with the first year as ceo. >> it is a delicate equation the pressure with bp at the moment on the other side of it, quicker to net zero. bp wants more hydro carbons it is a narrow landing path to appease everyone >> you have more coming up today. a busy day for you, steve. >> i'm hoping from the 10 out of 10 you perform, i hope to come in at 6. for 23 years i have been here, i felt the one bank of england i have to go now >> we do >> it is double chemistry on thursday afternoon we remember? >> my favorite wonderful. >> two hours of just analyziana.

what could you want more >> the bbc or the chat from ite. wake up, sedgwick oh, dear. >> thank you, steve. >> we will see you at 12:00. let's look at other corporate stories this morning it is a very busy day for earnings here in europe. let's look at this story with julius baer. the ceo has stepped down as the ceo. this comes after the company reported for the full year that this swiss wealth manager posted more than 600 million swiss franc loss linked to signature holding. 6% higher than the bank expected it will now wind down the private debt business. now an interim ceo has been appointed.

in other bank stories, ing is lower in early trade after cutting the income forecast for 2024 despite posting a narrow fourth quarter profit beat up more than 43% to over 1.5 billion euro in the period. >> remarkable to see how much the banking stocks are moving on the misses with the net interest income bnp reporting 46 billion euro revenue in 2023 and coming in 3% higher on the year, but below estimates. the bank trimmed profitability target saying the return on tangible equity could be 1.5% which is down from the original 12% guidance figure. charlotte, the market is reacting to the updated guidance with the lower estimate, but pushing back on the return of

equity >> that is a target last year to reach that in 2025 and they are pushing to 2026. the net income target at 8% which was 9% presenviously. me missed the target in q4 numbers. that is what the market is looking at with the net profit down 50% and hit by one-off losses in q4 it is impacting the bottom line. revenue was a little below expectations below 0.1% in q4. looking at the business, the revenue was 2.6% equity is up 69% we know that bnp has been pushing that business. you remember the deutsche bank it seems to be pushing off on

that front commercial services is up 1.8% certainly, that provision is higher in q4 up 39%. that cost of risk remaining low in 2024. for the full year, revenue is up 1% bnp has announced a cash pile after selling the bank of the west last year they announced 1 billion share buyback for this year after the one last year. they are increasing the dividend by 18% to 4.60 euro per share. the market very much is focused on those updated targets for bnp. >> we are seeing that in the share price. thank you, charlotte let's talk about deutsche bank the german lender announced a share buyback worth 675 million euro for the first half of the year and raised dividend for the

full year as well as the outlook for revenue growth this as the german bank reports a 30% fall of profit for the fourth quarter that was not as steep as what analysts expected. annette joins us now from germany. annette, tell us about the latest results from deutsche bank >> reporter: what stood out is that the bank is able to stabilize the business model with boosting revenues and operating profit in the private bank and corporate bank. that was the big aim at the start of the transformation process to diversify the bank's earning power away from the volatility investment banking. of course, they are very committed to increase the share price with the share buyback program and the fact that they are stressing they look into

perhaps doing full-on acquisition. they are on a growth trajectory. that is the message here from the management team. they also see clouds on the horizon. those clouds are coming from the political side of things rise of populist with the threats to europe and the populist here inside germany is a major concern to the clients when i spoke to the cfo of the bank, i asked him how much of a concern and also headwind it is for the business that we are seeing the political trends unfolding as well here in germany. take a listen. >> there is a debate going on in the political environment. some of that debate is between what i call traditionalparties and populist views in fairness, there are reasons

for the electorates to be unhappy. we have seen covid and inflation and relatively slow growth there is a connection with the political and economic environment. certainly what we would like to see is stability in the western democracies. stability here at home in germany. we think that fosters economic growth we think there is an important program of reforms that can be enacted here in germany to help drive growth across a range of elements of the policy landscape. those, in urn, by driving wealth and growth in the economy, i think would help address some of those underlining reasons for the populist wave through europe. >> do you hear from clients that they are concerned about that rise of populism here in germany with the afd is there a redirection of the

flows happening? >> there is a concern about an environment where the political establishment is either unable to put through change because of movements in the political world or sort of feeds an instability or an uncertainty about the future there's a number of different elements of that foreign investment is a key question innvestment by domestic firms i a question immigration is an issue in the german economy there are a number of ways in which the political environment translates into policy outcomes that can lead to uncertainty for our clients. we do hear that strongly we need predictability, if you like, to help drive economic viability. >> how do you feel the economic

sentiment in the country because those at davos were saying germany is tired do you feel germany is tired >> i thought it was an elegant way to think about the sick man analogy. we don't like or accept the sick man analogy. germany is a strong, vibrant economy with great technology and innovation and production capabilities i do think the sick man idea or the tired man lends itself the idea the man can be rejuvenated withreforms which can rejuvenate the economy we are confident serving the clients we do and the dialogues we do which the evntrepreneur drive is alive in germany.

i hope we can set that free. >> that would be nice. let's look at 2024 and the outlook. perhaps you could name a few challenges what are the main challenges as well for the banking industry and for your bank especially if you go into the new year >> look, let me start with a negative and that is investors are focused on the path for net interest income given there was a perception the banking industry earned on a short term. that will be felt in 2024. we provided disclosure of the path we think what investors are missing is while 2024 is a modest retrenchment, after that, there are years and years of tailwind because we are korming b

coming back when rates were flat or low or zero bound or negative what investors are missing is we have been in a two-year relatively weak environment for non interest revenues. we think the setup for growth and non interest revenue and we started talking about this toward the middle of last year is very strong we are well positioned to benefit from that. >> reporter: while the bank is growing and planning to grow organically, there are plans to cut costs further. they are planning on shedding labor. 3,500 jobs have to go after actually increasing the labor force quite a little bit the costs income ratio which goes down well with investors is now sitting at 75%

it hasn't been below 80% for a long time with the bank not able to control costs the management team is achieving those goals and increasing revenue and cutting costs at the same time and buying back shares which we are seeing from the market reaction. >> annette, investors are liking that thank you for that report. turning to another stock on the german index adidas will double the index in 2024 after ending the contract with kanye west. the fourth quarter results were better than expected after selling off most of the costs. also coming up on "street signs," a sales beat push for siemens. we will discuss the results with

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a slightly weaker open for the stoxx 600. it is down 10% falling from the risk-off session from wall street yesterday our focus today is on the number of corporate earnings in europe. we will talk about siemens the stock is up 1% after the company confirmed the full-year guidance after the first quarter sales beat driven by the u.s. cancer treatment diagnostics business has slipped. we have bernd montag joining us. good morning let's start with the performance for the quarter above market he

can pecexpectations >> we are happy with the start into the fiscal year with the strong revenue growth of 7% or so in addition to the very, very good order intake. i'm, as you said, particularly happy about the 22% growth which shows our strong position in cancer care, but also underlines the strength of the combination of our imaging franchise and cancer care treatment. >> in prior quarters, you flagged supply chain issues with respect to what pertains to china and the geographic presence within china. how is that looking now? would you say most of the supply chain issues have been resolved or are you concerned new supply chain issues could pop up with the disruption in the red sea

right now? >> let me correct a little bit this has been a situation we had with one of our core suppliers which was relocating for different reasons his production from china to mexico and then the yield of that new factory was not at the same level. it attributed to the political challenges or special situation in china, but a special situation of one supplier. we have that under control at the same time, we are working diligently and logging on and bringing into the siemens company a bigger supply chain network which will help us be more resilient into the future with the supply chain interruptions. we are also relatively, let's

say, unimpressed by the situation in the red sea if it stays as it is we are confident we can get the situation resolved and we don't see risk to the business targets. >> bernd, i like to look at the outlook for 2024 you are confirming your expectation of revenue growth of 4.5% to 6.5% this is lower from the first quarter. just outline for us what is behind this outlook for 2024 >> silvia, we had a little bit of a special situation as you already said in the last year because of the certain volatility quarter over yoquart. we are strong with the growth targets we have. we have just entered our second quarter of the fiscal year which

will face tougher comps, but especially in the second half of the year, we are confident about the growth rates we target on the comps for the third quarter. >> i would like to clarify something. there have been reports suggesting you are looking at reviewing the diagnostic segment of the business. could you outline for us whether this is true and whether your planning changes when it comes to this? >> diagnostics is an an tttract business it is a assumer super important the healthcare we need to crystalize the potential for the business i'm very happy and proud what the team has achieved with the strong uptake of profitability

in the first quarter, as well as the growth dynamics. >> sir, there's been plenty of healthcare companies and pharmaceuticals reporting in the last few days. the focus is on novo nordisk with the obesity drug. i wonder what company like your company can present on the successful obesity drugs do you see this as a challenge or opportunity for the business? >> i think compared to other companies, the link to siemens u.s. is less direct than potentially diabetes for companies. companies are focused on diabetes in general, the strength of

siemens is to fight the non-communicable diseases. the longer people live healthy lives, but also the more important chronic disease becomes, the more important our products become. the novo nordisk is one example of the broad innovation for us when there is a drug against alzheimer's, you need the diagnosis from our equipment when there is a new implant, then you need to guide the surgery. this is a topic which always helps our growth in the novo nordisk case, it is a comparable indirect one. >> we are seeing shares moving higher this morning after the latest results when you look at the performance in 2023, siemens is among the

top shorted stocks in europe where can you improve to convince investors >> so, when looking back at the last fiscal year, overall, we had a ifphenomenal year. we had strong growth we had proved the varying acquisition with the growth of 15%. we achieved the outlook and targets we have given at the beginning of the year. but the way to this full year was a bit of a roller coaster. we had a big q1 and surprise in one segment which we made up in the following quarters and so on i believe the big topic is we

will do better we have consistent delivery quarter over quarter so investors have the full confidence tof the ambitious targets. we will again be attainable with those targets. i believe the first quarter was a strong exclamation mark. >> that is a good place to leave it thank you for taking our questions today. bernd montag. coming up on "street signs," a powell pullback as the fed pours cold water on the march rate cut expectations. we will bring you the latest coming up next do you have a life insurance policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. if you

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welcome back to "street signs. i'm silvia amaro >> and i'm joumanna bercetche and these are your headlines the banks are under pressure from the earnings misses and the rate cuts. deutsche bank bucks the trend

with the cfo taking us through the numbers. >> pre-tax profit of 5.7 billion is at a high we grew year on year despite items that created noise what's really exciting is the momentum shell launches a $3.5 billion buyback program as full-year profit is $28 billion beating expectations >> whether it is the strong delivery on cash flow or improvement on the structure cost reflection or the capital discipline or the enhanced distr distributions. losses on wall street after jay powell pushes back on the investors hopes for the march kickoff off rate cuts. >> we will look at this at the meeting. based on the meeting today, i

will tell you it is not likely the committee will reach a level of confidence by march. and volvo races to the top of the stoxx 600 after it will stop funding polstar the ceo strikes a bullish tone to cnbc. >> pleased with the results of 2023 lots of hard work. a lot of foundational work that allows us to have a strong 2024 and beyond it was a torrid day for wall street with the majors pulling back the s&p down 1.6%. nasdaq down 2% this, of course, in reaction to what we heard out of the fed meeting yesterday. chair jay powell pushing back of the expectations of the march rate cut on the flip side, they did drop the tightening bias in the

statement and no longer talking about additional policy firming. there was something in it for the doves out there. perhaps not enough to cement the case for the march rate cut. on the back of that, stock markets dipped i want to draw attention to what is happening with the regional banks as well within the u.s big story yesterday. kpw index down 6%. biggest decline since the turmoil last march happened with the regional banks going under this after one bank, new york community bank corp reported a loss in the commercial lending portfolio. commercial real estate is coming up time and time again this is one reason we saw the pullback in the regional banks yesterday. as for the hand over for asia. this is not getting a bid these days stoxx 600 is down .10%

we have talked about the mega day of earnings. so many companies reporting the results for the year we are seeing dispersion let's break it down by individual boards. you can see with the exception of the ibex up .50%, other indices are under water. ftse 100 is up .40% from a company perspective with shell in focus good results right toward the top of the ftse 100 today as they are the first of the big oil majors to start with the results don't forget, we have the bank of england meeting which could be a driver for markets especially if the governors are sounding more dovish on the potential for rate cuts in the coming months. cac 40.80% a pull back for bnp. d dax is at the top of the index

deutsche bank is having a good session today up 4%. on the flip side, adidas is at the bottom of the dax. in terms of sectors, we have travel and less yisure up 1.2%. the tech sector is up .60% despite the negative session yesterday. focus on microsoft and alphabet and looking ahead with the results from apple and meta and a amazon we have real estate down 1.4%. retail is also not having a good session. adidas is pulling that basket lo lower. all three majors are opening up in positive territory in the u.s. a bit of a price break from yesterday. the signals are pointing to a better start today it is a busy day with central bank policy. the krona is weakening against

the dollar after the bank decided to keep the policy rate unchanged at 4%. the central bank hinted rates could be cut sooner than indicated in the november forecast money markets are pricing in a near 100% change the bank of england keeps rates at the 16-year high this afternoon. traders eyeing the forecast for clues on when policy loosening could begin. the fed held rates at the high on wednesday while policymakers warned they need greater confidence that inflation is moving toward the central bank's 2% goal before cutting rates the chairman jay powell poured cold water on market expecting takes for a march cut. >> we will be data dependent we are looking at this meeting by meeting based on the meeting today, i

will tell you that i don't think it's likely that the committee will reach a level of confidence by the time of the march meeting to identify march as the time to do that. that's to be seen. i wouldn't call it -- when you asked me about in the near term. i'mhearing that as march i don't think it is the most likely case or the base case >> i'm pleased to say we have james ashley, head of the international strategy at goldman sachs. good morning, james. >> pleasure to be here >> we were hearing from jay powell now there is a lot of expectation that even though we heard the fed it is unlikely the rate will be cut in march, that means we will be an deggressive toward the ends year what is the likelihood >> the market is pre-re-pricinge

cut. it is possible, but unlikely if you look at the aggregate number of rate cuts, it is the base case. that situation means the fed will be cautious about taking rates down the key risk is the market is still ahead of itself. >> when it comes to the reaction in terms of stocks yesterday, wall street was lower on the news that we're not going to get a rate cut in march. i wondered from your point of view and the risk you outlined there, what is the outlook for u.s. stocks for the rest of the year if we see the markets pricing in a different timeline? >> i think the market grinds higher we are close to record highs there is still an upside the environment is a slowdown in

the u.s. economy, not recession, but the slowdown from the pace in 2023 and the fed is taking rates down, but less than the market expects, but there is some upside. we don't expect the total returns for u.s. equities to be as strong as 2023. >> the fed is emphasizing they are data dependent, the same as christine lagarde. what needs to happen with the data for the fed to start cutting interest rates we don't seem to be there yet. gdp numbers, i know heit is backward looking, but it is an issue. what more weakness do we need to see for the fed to be ready to go and start cutting

>> if you put up that question in front of jay powell, he would say we look at every smorgasbord of data. we will see what is happening to core inflation although core inflation measures, but pce is the bellwether if we have a couple of soft corporate prints, then march is possible i think likely we are looking at summer in may or june. if you think about the key measure to dictate fed policy, everything is the broad answer the payroll is cooling with inflation. >> is the governor for the bank of england likely to change his tone and endorse the rate cuts >> i think the bank of england is at ann interesting point in time on the monetary policy committee, the nine members last

time out, voted 6 6-3. it would not surprise us if we have one or two members talking about rate hikes little doubt rates are on hold, but the majority of the members are beginning to think about when do we take rates down there are a couple of hawks saying rates may need to go highh hi higher. >> the market has done the cuts for them in anticipation of more than 100 basis points. if they don't do that, then the market will have cornered them. >> just the feedback, the market anticipates the policy members we will start to see rates move higher i think we are moving to the point to begin to think about the policymakers taking rates down it is broader than the fed right now. >> i also want to look at the messages from central banks. you know how in 2023 hiking was

the message from all of them they were actually at the level in increasing rates. that is a different reality for 2024 what do you make of the different speeds among the central banks? >> we can talk about the terminal point where rates would go it is clear if you were talking about the euro area or the fed, all agreed policy has to be tightened. if you look at the uk and europe, growth is flat the u.s. is okay inflation is different rates in all areas have probably peaked the trajectory with which it can be taken down is sensitive about what is the resilience of growth you will now see dispersion among central banks. what one central bank does is informing the other with the exchange rate. for the most part, this year is more diverse set of central bank

outcomes >> very clear. james, wonderful to chat thank you for joining us on set today. james ashley, head of international market strategy from goldman sachs join silvia and myself for the bank of england decision at 12:00 and stick around for steve's decision he will speak with governor andrew bailey at 16:00 gmt. coming up on "street signs," today, earnings is coming up with meta and amipple after the closing bell we will break that down coming up next. secure payment. card readers you can rely on. and one place to manage it all. whatever the stage, businesses that grow grow with shopify. ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life

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welcome back to the show out of all of the companies we heard from this morning, it was volvo cars the company will hand over responsibility for polestar to gilead in china. this as the swedish automaker posted a 70% jump in fourth quarter operating income to 6.7

billion swedish krona. i spoke to the ceo and asked for his take on the last quarter >> we are very pleased with the 2023 results we had record volumes and record revenue and record earnings. earnings were up 43% year over year to 25.6 billion i think more importantly, we are pleased with the foundation that has set for 2024 we expect to be another record year in terms of revenue on one side, pleased with the results with 2023 with lots of hard work and the foundational work which allows us to have a very strong 2024 and beyond. earnings season continues stateside with amazon and meta and apple reporting after the bell we have arjun with us.

what are you watching out for especially with amazon and meta. we are more familiar with apple and the headwinds. what are you watching for here >> amazon is all about aws the profit driver for the company. it is interesting to see how that cloudy vision is faring among all of the hype around a.i. amazon has the competitive products with microsoft. the market will want to hear about growth in the december quarter and the outlook for the rest of the year are they expecting acceleration with cloud computing that is key. the market wants to hear cloud will accelerate to a further growth rate. the second point is advertising. this is an interesting part of the amazon business for the last couple years they have a unique position to offer ads they are selling on the platform the market is looking for 20% growth year on year. faster than google in terms of meta, the market is looking at revenue growth of 22%

year on year they are expecting a fast dpr growth huge run-up in the last year the market will hear about how the company is figuring out the competitive fret with youtube and tiktok and how it plans to monetize the short video product with the competition >> tell us about apple as well some of the news we got for apple seems they started 2024 on a bad note. >> it doesn't look to be getting any better if you look at the expectations for the december quarter, the market is expecting flat revenue growth iphone is up 3%. in a holiday quarter as well with the new product that doesn't bode well max sales are expected to be flat the only bright spot is the services division which is expected to bring in $23.4

billion. 12% growth that is slower. >> we keep telling people on the channel with the vision pro. >> not a needle mover. from barclays, immaterial for financial results for this year and next $3,500 for that product. it is too expepensiexpensive. >> arjun, thank you. we will circle back tomorrow that is it for the show today. i'm joumanna bercetche with silvia amaro "worldwide exchange" is coming up next.

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it is 5:00 a.m. here at cnbc global headquarters and here is your "five@5." we start with wall street picking up the pieces after the worst day since september. futures are fighting for gains ahead of the open. that after fed chair jay powell dashed hopes of a march interest rate cut. he says it is not the base case, not at this time. the regional bank reckoning strikes again after the shares of the new york community bank has the worst day since last year. and elon musk looking to reincorporat