and that's all for this edition of "dateline." i'm craig melvin. thank you for watching. ♪ european stockmarkets are open for trade and they have only been paused as we saw across the major markets yesterday aligned with wall street. the dax fresh on the high and also on the french market on the cac. so certainly a bit of appetite again. the bullish sentiment is creating sentiment around the european stockmarkets. the s&p 500 yesterday, we saw a fresh record close. nvidia, another play on those markets stateside and microsoft

too. the two propelling at the dow, the nasdaq. we eke out another tenth of a percent. let's take a look under the hood and see whether the gains are falling and how they've been distributed across the board. it's only paused at the sector level. a couple of patches at the red. at the top, retail. at the bottom, mercedes. we're down 0.2%. insurance names, prudential giving back some territory. in the production basket, we're sliding there. telco, slightly underwhelming, i've got to say. we're doing a compare/contrast. we're noticing some green arrows. banks are doing high.

paribas close to 2% for the french banking company. industrials are up. food and drinkimproving this morning. games, travel and leisure, the likes of accord all up 1%. telco -- technology, i should say, up by half a percent. retail is the one right at the top as we see it bounce on the 1%. the likes of indo techs getting there higher. to the early moves on the indexes, that's a tenth of a percent plus. stronger is what we're seeing on that market. fifth -- sixth positive session out of seven for the uk market. we've cleared 6,800 points. we're still reaching for higher

territory. this was yesterday's signal on the dax. we're waiting for it to pop open. stocks out of the spanish market to italian names, a bit of a patch on the smi. swiss the odd one out today. ibex helping out the stockmarket. the company posed to the net profit of nearly 1.3 billion euros in the period. the 2.3% we're seeing, they were up 43% so far on the stock for the course of the year. so it has been stronger. the trading down is not doing any damage so far to the likes of inditex. we saw online sales, very strong execution for the company versus a year ago.

that was a real improvement too. the numbers across different categories of the company. very strong performance. by comparison the stocks are up this morning, but it does expect north american sales to fall mid s -sale. the german brand is forecasting in other regions, 77 cents per share, unchanged from last year. it's been up 30 cents over the past year. there was a lot of interest in nike for the people stateside as you look at some of the analysts' reports. interesting to see some fairly downbeat remarks on adidas. the stock is weaker. down almost half of a percent.

volkswagen is expect to see a pickup this year with the offerings of evs. they expect to improve sales by up to 5%. the ceo was asked about his expectations for the year. as we take a listen, he set out what he expects for 2024. let's take a listen to that conversation. the rev new wascame up on par. more than doubled. this gets us confidence for 2024. 2024 will be a challenging year. there's a lot of macro uncertainty, macroeconomic headwinds, inflation. a lot of positives though.

positives from the overall market. we expect the overall market to grow by 2% to 3%. we have great products. we have a great product offensive. we talked about that before. last but not least, we've launched ambitious programs. that gives us confidence for the year 2024. >> let's talk about a little bit about the general growth story behind because you're saying, of course, there's loads of competition especially probably from china. so how serious is that competition if you look at how much subsidies they're getting. they're very cost-efficient. so in a nutshell, how much of a threat is there from chinese competitors? >> when you talk about chinese competitors, i assume you're talking about europe. china for china is a different story. in europe, it's a different story. we have strong products, great brands, a lot of fleets, fleet

customers, and we work on productivity and on the cost space, and with these ingredients, we are convinced we have a very good position and a very strong position going forward. we take the chinese company serious as we did before with japanese and korean competition. but we are convinced we have a very strong future in europe. >> let's look also on the chinese market because there the combustion engines, you have been very strong. with electrified vehicles, it looks weaker essentially. how do you want to turn around your fortunes there? >> you're exactly right. we have a very strong combustion business, but we have to catch up in nin the bev sector.

we have to look at driving and the cost base, specifically for the batteries. we have teamed up with others to increase our infotainment, increased karaoke. it's much cheaper. puts us in a position to offer more competitive price. >> when will you be able to offer this to china? >> in the next one to two years. this is why we significantly while we said we will be able to catch up in two to three years, 2025, 2026 onward, also with the new product when we bring two models on the platform, and in between we are prepared to

deliberately gift market share. >> let's get out to annette for more. thank you very much. perfect interview there. i want to get into what's going on with the brands. the numbers are slipping in terms of operating profits from double digits to single digits. >> if you look at audi, they're a different kind of animal. i think they're undergoing a different process. clearly the 9% return on sales figure for the audi group, they're kind of combined with lamborghini and ducati, it's not good enough if you look at how they should be operating in that luxury or seemingly luxury segment. so there's a lot of work to be

done. in other areas of the big holding like volkswagen, the core brand, they're actually making progress and getting more profitable with a return on sales figure of 5.3. it's not super big, but it's a lot better than in previous years we have seen the core brand being not very profitable for many, many years and now they're at least moving toward the target of 8%. of course, that's nowhere near where porse porsche sits. it's moving into a different electrification space but at different speeds across the globe, and that's a big challenge. you can say, listen, we do it the same for every model everywhere but the markets are moving at different speeds. china let's moving fast and

needs specific models. it's been a realization for volkswagen the last two years, but at the same time, it would have them moving very fast in electrification. europe is not so quick and the rest as well. so they are stressing the need for flexibility. i also asked arno, the cfo of volkswagen if they're planning to push back on targets for electrification. let's take a listen. >> we're investing accordingly and preparing accordingly, but as you said, the speeds in the different markets is different. the market in china is turning to electric rather fast. we see a more slower transition to electrification in europe and also in the u.s., and our strategy is to bring and continue to bring great electric

ca cars. we continue to ramp up electrification. we keep our combustion engine cars competitive and bring in more hybrid cars we are flexible. the customer can choose. but to be very clear, the future will be electric and be prepared accordingly. >> so this year will be another year of transformation for volkswagen. so they're trying to get their software unit up to speed, which they have been doing quite successfully already in the last year with the new vehicle from audi being on the software platform and the new car that was the problem child. he lost his job because of not getting the software problems fixed. we still have a huge loss of 2.6

euro in the software unit, but that can be explained. they talk all the ramp-up cost of electrification and software of all new models, and there are 13 new models coming this year. it's like the story i told you yesterday about porsche. there are loads of new models coming in the market and they will be seen from 2025 onward, steve. >> is that a gulf? >> wasn't that your childhood? >> i love it. oh, look at that. what is amazing is it's smaller than the current polos. >> i can only recommend. it's a gti and actually worth coming. >> we used to get so excited

about the golf gtis, the original ones, and now it looks a bit pedestrian, doesn't it. it doesn't have what? >> hubcaps. >> going back to the '90s i had the peugeot version, which i loved. it was a riddick us c i had a convertible gulf. >> you know you're giving away your passwords, naming all your old cars. annette, what was it? >> i had a gulf. it wasn't a gti because it was too fast. we called yours a strawberry basket. >> it was. it was an extraordinary car being a rugby car fitting five

players in it. >> i had a south korean car, the kia. it was a cheap asian product to western markets. >> we're not past my test at 17. i was the worst driver. i nicked off my mother in her volvo. it was a mid-sized car. >> you say you flunked your driver's license. >> no, no, i passed my first time. i just was a crappy driver. not like you. >> it takes me back to the day we were driving around a car park together. >> i don't think we were racing. >> i think you still beat me. >> that's not true. you were wearing high heels, weren't you? it was after a bankers lunn chun. both of us were tea totalers. we got in our cars and were racing each other. coming up on the show, a

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let's get to solvay. they had a drop. the group says it expects the downward trend to continue into this year and forecasts a 10 to 20% drop in ebitda. let's get right to philippe kehren. what our investors and viewers need to know, how much worse is it today than you previously expected or is it a continuation of a trend which you've already reported? >> yeah, in fact, i would say we're reporting our 2023 results, and 2023 was really, i would say, in two parts. you know, the first half was extremely strong and we had extremely strong results. in the second part of the year, we already observed some softening in the demand of some

of our markets that we were able to compensate through pricing and cost-saving measures, so this is why i think we are posting very strong results for 2023 with, i would say, a stable ebitda and record margins. if we look at 2024, i would say the start of 2024 looks like the very end of 2023, and we're focused on our custom measures an cash management and capex management, and we've assumed in our forecast that this situation would last more or less over the year. so we did not assume a recovery, i would say, in the second part of the year. >> philippe, let's just dig down into where the demand problems are coming from. could you just illuminate us, please? >> first, we are very diverse in

markets, you know. our biggest end market does not represent more than 20% in our portfolio. so this is why i think we display a very good resilience, and when you look at the variation of '23/'24, we're talking in the range of minus 10 to minus 20%, which in the current macroeconomic context is quite satisfactory and allows us to deliver what we deliver to the market, which is capex payment and dividends. but i would say globally what is making -- to go to your question, the demand a big soft in some segments, particularly in construction, you know that we have some essential products that go into the manufacturing of glasses and so on, is probably the interest rate and the inflation. so, of course, we can hope that the situation would get better, but, again, we did not put that in our forecast, and obviously

we are ready whenever the demand picks up. >> let me get to the lack of visibility around the second half. does that disturb you for the second half? >> not really. you know, we cannot control the demand of the markets, so we are prepared with whatever happens, and this is what is translated into our forecast today. what we would focus on is our cost-saving program, which is already delivering some results, you know, that we announced last year, a cost-saving program of 300 million euros that's possible thanks to the separation that took place in december last year. and we will also very much focus on the management of our cash and our capex, meaning that we will be focused on essential investments in the first part of the year. and if ever at some point the situation improves, we will be able again to invest in our

growth projects. >> you mentioned the pricing trends across some of the other businesses away, cash to be more resilient year on year. we are in an environmental where prices start to retreat. why do you see resilience in your pricing trends? >> well, we see a resilience in most of our businesses simply because, you know, the underlying trends are very solid. we're serving markets such as the farmer, sustainability, those are extremely solid. and on tom of that on some of our markets, we have some longer term contracts which allows us to have resilience as we said. >> moving on to the debt situation, 1.5 billion euros at the end of last year, slightly lower than the previous announcement, what's the target? do you intent to lower the debt from here? >> frankly speaking, karen, i

think we're very happy with the balance sheet that we have. we're seeing it's a very efficient balance sheet. what we're focused on is to maintain our investment rate rating, which is the way we want to operate. so we're happy with it. >> philippe, people don't seem to ask any questions about it anymore and it's a shame. but you're going to reinvig rat or review or redesign your esg commitments later this year. tell us about your commitment. i know it's gone down if i'm correct, about 19% in 2021. but what is the new plan going to look like? give us a sneak preview. >> well, we are taking all of the commitments that we took previously before the separation with us, and i'm going to say another transition is really something that is very close to my heart. i've been very much involved in my past career in a lot of

different products in this field, and we are confirming we need to do this transition as fast as possible. of course, it's with regard to climate chaillenge and competition. we should complete phasing by 2030. we completed the phasing in the u.s. a couple of weeks ago, and i'm very proud of doing that. we look at completing carbon neutrality by 2050, but i'm pushing really, really hard to do that as fast as possible. we also confirm our commitment to decrease by 50% our greenhouse gas emissions by 2030. that's for c02 emissions. obviously we have a lot of ambitions in other domain, and we will communicate very quickly on the other aspects. >> philippe, let me ask you about sooda ration.

we think about all that's evolved. your company has been about solar and other things. how do you reposition around the soda ash stories? >> we're one of the original producers. we think this is very important. we think the world needs both. why? it's competitive, but there's not enough resources in the world, and those resources are located in remote places. we're invested in both. we need synthetics with the ash. that's why we're working really

hard at reinventing it. we were the originators when our founder invented it. we're currently creating a new process. that will allow us to produce also, you know, if we have the right sources of energy in a completely carbon-neutral way. this is what we announced very recently with the first carbon-neutral soda ash project in saudi arabia in the framework of the neon product. >> philippe, thank you very much. e.on raises its five-year investment target to 42. it will rise by 2028.

bnb paribas has moved its target up. it's seen an increase this year. >> how can the income be under so much pressure when interest rates are so high and they're ohm going to go lower? >> i think charlotte spelled out to us about the french backdrop being different to the rest of the european landscape. i'm sure she'll explain again if you want. we'll be joined by the aforementioned charlotte. we'll ask her about bnb paribas -- no, we won't. that's coming up next. switch to shopify and sell smarter at every stage of your business. take full control of your brand with

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rivals h&m. >> volkswagen picking up orders. arno antlitz telling cnbc he was quite bullish in the conversation he had with us. >> we have a very strong position going forward. we take the competition seriously, and as we did before with japanese and korean competition, we are convinced we have a very strong future. >> and e.on lines up its day. the ceo telling this show why he feels so confident in his investment plans. >> with the acknowledgement that we need more infrastructure came the acknowledgement we need different procedures, and we're seeing now that this is indeed accelerating the process. we are not there yoet.

much more to be done. european markets have been strayeding for a half hour. it's all about lucky number 8. through 18 points on a fresh record before drifting off and through 8,100 on the french market before seeing a slight retreat. there's an appetite again for the market indices. europe in line with what we've seen from wall street. in terms of the benchmark here, we're just coming off from some of those high ranges we've seen in the first half hour or so. let me take you to what we're seeing at an index sector level so far this morning. there's been a little bit of movement. what we've got now, an even split. up 2.6 on the retail basket.

inditex has been one of the high stocks. banking, 0.4% higher and health goods. here's one. we've seen the biggest daily gain so far in about five years. we've had just about everything from the company. we've had a new growth plan, profit plan, a share buyback of $100 million. so the e-commerce delivering. balfour up. again, i was pointing out the compare and contrast. you have nike being positioned by two brokers, their top pick to see some warnings coming through. from adidas, it does not paint a strong picture in the relative gain to its rival, but i want to

circle back to inditex. you can see the gain, 4.6% higher, adding to the year today. the numbers telling us that what las been the darling of the retail basket for a number of years still executing at this stage. >> yes, absolutely, very strong results from inditex. they had seen a slowdown in q3 in terms of that. we see this accelerating. it's been reassuring. net profit up 13% at 5.4 billion euros. gross margin. so higher gross margins there. to see the margins stable for 2024, up or minus 50 basis points, sales up 10%. they have been working very hard in closing some of their smaller stores, and their flagship store as well. they've been pushing into two categories. there's been a bit of a void for

them where others have been struggling like cashmere and silk. it's been working for them. they haven't hiked prices as much in 2023 as they had in 2022. i see a big growth -- big growth opportunity in the u.s. it's something a ceo had flagged already last year. and they're still saying this morning, the ceo saying there are significant opportunities in the u.s. for several of the brands. they will have opened new stores in l.a. and las vegas. it's one of the areas that's been growing quite aggressively as well in the markets. again, they have 5, 700 stores across the world, but online says 16% of it was aggressively to work online and in stores as well. they're working to join stocks between the two. they're very nimble when it comes to their supply chain. we know they have a tight and nearby supply chain in port grail, tokyo, and portugal.

they're very agile. shares have been up 4.7%, up like 8% for competitor h&m. a big positive reaction. shares up 4.6% in madrid. dividend up 28%. >> i wonder. the american market is changing. that was the story last year that the u.s. consumer was wrong. i was reading even the high end spending is expected to come down in the states this year. charlotte, thank you very much for spelling out the story for us. globalization reached a record-high in 2022 and remained closed in 2023 despite geopolitical conflicts according to dhl and its 2024 report on global connectedness. it says u.s./china ties are

continuing to diminish and europe has decoupled from russia. i spoke with john, from dhl. talk about some of the supply chain diversification. >> i think the same quality is not great, but i've talked to a level of global connectedness being at an all-time high, and i've stood in front of your audience before and said very similar things that as we publish this globalization report every year or so, it continues to show the resilience and the effectiveness of globalization going forward. this addition is no different than the additions in the past. globalization is at an all-time high. it's not giving way to regionalization. there's no fracturing of global trade along the lines of geopolitical ally groups.

and, thirdly, corporate globalization which is a new finding from the study, if you will, is at a new all-time high in the sense that corporates are looking more to overseas for their sales, their expansion plans, distribution centers, manufacturing sites, and regional offices. as a scorecard, we're very pleased with global connectedness, and despite all the things going on in the word today, it remains at an all-time high. >> i wonder how lasting these trends are, john, as we talk about the ties with u.s. and china and the decoupling with russia and europe. how quickly could a recoupling ever happen? >> could you repeat that question? >> yeah, john. it does sound like you're having a few sound issues. talk a little bit slower so perhaps you can pick up on some of the points. i'm just saying we're clearly going down a certain pathway as

key country ties are broken, u.s. and china, russia and europe, but at any point down the track have we saw some warmth or change in geopolitics, how quickly could a recoupling happen? >> i couldn't catch that. >> i think we might have to reconnect. we can't continue on this basis. i think there are interesting points. to this report, i don't think it's going to change. as we get into this u.s. election cycle, one anticipates relations could get worse. but how long are these trends going to persist for if supply chains are reconfigured. it seems factories would shut down. >> i would disagree with you if i may. just to pick up on what john said and what we talked about previously, despite the halts on

both sides of the pacific, trade remains strong. china, we're concerned specifically with the trade deficit, but you see they've remained markedly consistent over the last five, ten, fifteen, twenty years, and i hear what you're saying about the concerns and they're very clear. whether it's obama or trump or biden again, it's hurt. >> there are real trends. >> there are no real trends at this point in trades between the two countries. >> i think we've got john back. we do have john with us. john, just weigh in on this -- we don't have john. >> look, i don't dispute that it's a danger and people are looking for different supply chains and to diversify. let's be honest about it.

the experience in europe shows if you have too much of one key resource coming from one key juris jurisdiction, ie, energy coming into europe, it's clear there should be a diversification. >> there's also a big report on india as we talk about diversification. let's get to a break and perhaps we can get back to john. coming up, a warning of the latest impact of the airlines safety crisis. we'll have the details next. what is cirkul? cirkul is the fuel you need to take flight. cirkul is the energy that gets you to the next level. cirkul is what you hope for when life tosses lemons your way. cirkul, available at walmart and drinkcirkul.com.

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moment. it's the reason why the spanish market looks so good. let's try john pearson once again. it should work. we're using the old telephony.

i thought your conversation was great. you're not seeing fragmentation, and splits from key relationships as well. i'm thinking the politicians are talking but not enough to impact business. is that your interpretation as well? >> i can comment more on the globalization report than what the politicians are saying, but your summary there is absolutely right. i should be very clear that what we're talking about is the tenth edition of the global connection report which is very fact-based. globalization is the group. 9 million data points that say exactly what you said. in my own mind the way i look at this, global connectenedness

reached an all-time high over a year ago. they're saying the same thing in dubai. secondly there is, importantly, the hotly contested topic of fragmentation along geopolitical lines or allied trading blocks. when you fracture out the specific situation with the pandemic and russian decoupled from europe, there's absolutely nothing to say that that's dropped by even half a percentage point. and, thirdly, the globalization, as you said there, isn't giving way. the distance is still 3,600 kilometers or something. the way i like to say that better, if near shoring, offshoring, or thee different types of shoring were happening, mathematically, if everything moved from mexico to the usa, the distance would be a few kilometers. that's not true. you look at the economics of the

supply chains they provide customers and in turn their customers. they've done exactly that. they've been efficient and economic. has there been some finessing around the edge of the most critical componentry? yeah, absolutely. but on the scale of things and the scale of how supply chains work, we're very pleased with it. >> i'm very pleased to hear what you have said. i'm a globalist. john, one thing i thought that was really interesting, we've spent a lot of time on this channel being dismaced by european business leaders who say we're getting slowed up in europe by red tape and permitting and what have you and we don't have the growth as do other regions. but with singapore, i expect growth, something like that, followed by the netherlands and ireland. europe can do that, can't they?

>> they can as you mentioned there. there are other economies in the top ten. as i often say, for every piece of negative thing you say, just about every week there is a free trade deal being signed. i sit here in our fifth largest economy in the world, and, by the way, one of the fastest growing, they were looking at the agreement between norway, switzerland, and iceland. markets smaller in size than the other two, but nevertheless, they've been trying to put this together for several years and something that creates more investment to india. i give one more fact from the report. india, second only to the usa was attracted to the investment than any o'country of the planet. you don't put money on a horse you don't think is going to win, so i'd like to posit that to your viewers and your audience in the sense of how far and how

quickly india has come in terms of setting themselves up in terms of where the logistics really were. >> john, i just want to circle back to the connectedness of u.s. and china because other data that was served up doesn't seem to fit. there does seem to be a chipping away at china's dom nens. it was only a month or two ago the u.s. was buying more from mexico than it was from china. there must be some debtry meant to the u.s./china relationship if we say mexico, india, southeast asian companies pick up more business on the back end of china seeing more dough carolinas. >> great question. i think one's got to put some perspective to this china/u.s. topic. the first thing i would say is the levels of connectedness between the two countries was extraordinarily high over the last, you know, decade, let's say, extraordinarily high. it's come back 25% over the last

eight or nine years. what level is it at now? it's about at a similar level to what it is between most other countries. that would be my first point. the second point is they both represent each other's biggest trading partner, but as anyone would know and expect, some of it has shown it would decrease over time. it's decreased to a level that is basically the same as everyone else. now, has the china one topic emerged over the last two to three years, yes, and as we reported this in the last report. vietnam, indonesia, thailand, india -- it seems like i'm mentioning them all, but i'm e not -- just a handful represent china plus one.

it's not decoupling. it's outside derisking. the other thing is i would say this this is not just mu multi-nationals saying we're in china, we'd like to be in indonesia or india as well. they're saying, we want to be closer to our customers. just the other day, chinese relocated to thailand and egypt, and that customer is already on our sort of prospect list of customers in that market because they want to be closer to the middle east and closer to southeast asia. so that's the way i'd add context and perspective to this china/u.s. topic. >> i'm glad we could make it work and absolutely fascinating information. john pearson, ceo of dhl express. u.s. airlines warns of further delivery delays. scott kirby warned deliveries will be way behind.

southwest bob jordan said he wouldn't be surprised if he had to face another forecast delivery cut as well. boeing fell over 4% on the news. u.s. airlines also took a leg lower over the week. the delivery forecast delayed their ability to expand capacity. boeing has seen shares fall. it's cement its market cap below that of its rival irbus. they closed tuesday with a market cap of $112 billion, circa $24 billion less than the european airlines. arabile, i've just gone over the whole thing. >> you have. boeing is lagging the 49 that airbus actually put out then in the same month. just on another separate note with regards to this, the whistle-blower who blew the whistle on alleged safety concerns at the aircraft

manufacturer boeing, john barnett, passed away officially on saturday, according to the bc and sky news. so that i thought was very interesting to note in this whole situation. let's remember as well boeing is under both regulatory and criminal investigation as well due to that near catastrophic incident that happened in january. we've got united airlines, southwest airlines, alaska airlines, even delta all showing worry and concern about when these deliveries of these 737 max-10 -- so the next generation of airplanes -- is coming to the fore. united airlines says focus and do it right. >> there could be an increase in airline prices and tickets due to the lack of planes coming to the market. ryanair said summer prices would be 10% higher. hard to know if that's just an excuse. we saw a flow in the cpi numbers

overnight that states that airfares are still going up. >> they certainly are. ryanair said they expect a drop to just under $200 million when it comes to annual forecast. they initially thought they would get 57 aircraft. they're only going to get 40, and that could be even less. some of the other airlines are saying pretty much the same thing. in fact, what we didn't know for sure was whether they would actually switch over to airbus. and some of them are. delta air lines is saying they're going to take on airbus's a321 model instead of flying boweing. >> if you charge more in ticket prices and charge more to the customer, where does that leave the compensation market? it's very interesting, isn't it? >> it's called cheaper planes when they finally arrive. four get about list price.

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it is 5 a.m. here at cnbc global headquarters. i'm frank holland. here's your "five @ 5." we talk about the rally with the s&p. futures are facing a bit of pressure. nvidia is bouncing back in a very big way, by citadel's ken griffin says they have options with different risk/reward profiles. capitol hill be hold a