it is 5:00 a.m. here at cnbc global headquarters. i'm frank holland and here is your "five@5." big tech bounce back. wall street trying to claw back yesterday's massive losses as growth stocks are falling out of favor. this morning, futures are mixed. one day wonder or long-term trend? will investors jump in on the red hot trade? how retail investors should be positioning portfolios as tech now takes a tumble.

taking on wall street. running mate jd vance not pulling any punches in the keynote as he accepts the vp nomination. and get ready for netflix. it's thursday, july 18th, 2024. you're watching "worldwide exchange" right here on cnbc. ♪ good morning and welcome to "worldwide exchange." thank you so much for being with us. let's get you ready for the trading day ahead. we get you a check on the board. the s&p is up over .25%. the dow would open 40 points lower. nasdaq with the biggest bounce back over .50%. you see a mixed day for wall street on wednesday with wall street close lower by 5%. the worst day since december of

2022. also, you can call this a sign of the rotation into value. the first time since 1999 the dow notched a gain. also this morning, we are checking the pre-market gainers for the dow. intel at the top of the board right here. up 2% followed by apple up 1%. chevron up .75%. after the whipsaw wednesday, let's see how asia closed and europe is shaping up. silvia amaro is in the london newsroom. silvia, good morning. >> good morning, frank. while you know the narrative around the selloff of tech yesterday is also continuing here in europe. in fact, the tech sector is among the worst performers so far into today's session. let me show you how the overall picture is at this stage in

europe. we have the majority of the bourses trading in the green. i would highlight the ftse 100 is up .8% in the context actually of the u.s. economy earlier this morning with new labor data figures suggesting that wages grew 5.7% in the three months to may. that is raising doubts if the bank of england will be in a position to cut rates in the month of august. we'll see. in the meantime, let me show you how european chip makers are trading with the concerns around whether the u.s. is going to impose new export restrictions to the names. we saw asml shares moving lower by 10% in the context of the concerns. at this stage, they are ma marginally lower by .6%. you see asml recovering in today's session. one company, nokia, reported a

32% slide in operating in the second quarter as slower sales in 5g weighed on the telecom giant. we will continue to see what happens in today's session. frank, it is also the day we hear from the european central bank. >> silvia amaro, thank you. we turn to the rough session for stocks in asia with jp ong. jp, good to see you. >> good to see you, as well, frank. wit we start with chips here. you have to start with taiwan and south korea. it is not so much the prospect of the tighter trading curbs with companies that deal with ch china, but the not so flattering words by donald trump over tsmc that kept it under water today and pulled out the taiwan

exchange hitting record highs the last couple sessions. mind you, the questions if the u.s., under a trump administration, to force taiwan to pay or contribute more to make sure the u.s. participates and ensures the defense pac is secure. that weighs on south korea because we know south korea and u.s. military is very strong. we saw it keep its head above water, but tech stocks falling and leading the kospi decline. we saw chip related stocks like tokyo electric, the parent company of arm and softbank lead being the laggards. there are questions as to whether or not japanese authorities intervened with how stark the pressures was for the yen. we have to wait for data to confirm intervention.

on the bright spot, china will release more stimulus after the third plenum was wrapped up. we have to watch out for hong kong stech stocks. the index pulled down the index on this thursday morning. frank, back to you. >> thank you. let's talk about the divergence in the market over the last week and the selloff in the market. we have bill stone with the glenview trust company. >> good morning. >> big part of the nasdaq selloff is chip stocks. they sold off on restrictions from the biden administration and comments from form you are preside former president trump. i want to ask you the smh is down 2.5% since the start of the third quarter. >> well, they had a heavy of a run. you are always concerned when things sell off. i call this the silly season for

a reason because you see tons of policies thrown out with a presidential election. whether they get ienacted or no, you have to wait and see. you have to ready yourself with the volatility with the sectors. this will probably continue to happen with the run-up to the election as they look for the edge to look for something to appeal to the voters. i think you have to take a bit of a wait-and-see -- you better know you like the business you own like nvidia and certainly the earnings this quarter, i can't imagine will show any sign of issue. it is really about future policy, not about today. >> you are mentioning earnings. i have talked to a number of traders. a lot of them believe the so-called rotation we are seeing will shift back to the trade we saw dominate earlier this year

before earnings. mega cap tech earnings next week. do you see that trade picking back up? >> it is the million dollar question. i do agree the earnings will be very attractive from the big cap tech. it is part of my math not to say that. i do think valuation is on the side of the rotation, particularly with the small caps. they are trading at levels really close to what we haven't seen since the 2000 tech bubble. relative valuation to the large. they do have some room to run, but i think it should give you some, hopefully, comfort that you don't necessarily see the big tech plunge. maybe it means we continue on with this breadth in the market and not have tech go down which is the best of all worlds. >> bill, you are saying

something interesting. the transports broke a five-day win streak finishing down more than 1%. i want to ask about the case with the small caps is they will do well with fed rate cuts and if the economy stays strong. are there other sectors that get better opportunities? that is basically the soft landing. >> yeah, it's funny. you probably say tech is it, right? if that is the soft landing, you just continue to chug along with a ton of spending in the tech sector. i think you have to think about it with a bit of a barbell. you have things on the healthcare side to give you a cushion if the economy deteriorates. >> bill stone, good to see you. thank you very much. >> good to see you.

thanks. >> for more on the trading day ahead, head to cnbc pro at cnbc.com/pro. turning attention to the campaign trail and senator jd vance taking center stage during day three of the rnc officially accepting the party's nomination for vice president. he used the speech to blast wall street and big business. vance's speech comes as three high profile democrats calling for biden to bow out of the race, the same day he tested patchy positive for covid. we have brie jackson with more. >> reporter: good morning. we saw jd vance take the stage behind me last night and he worked to connect with voters by sharing his story and slamming the biden administration policy. it was clear vance was making a

direct appeal to voters in battleground states such as michigan, pennsylvania and here in wisconsin. we did see him talking about the challenges that he has faced growing up. he said he grew up in poverty and saw loved ones struggle wit. he tried to relate that with families struggling with high inflation. vance slapped the biden administration policies and laid out the republican vision for the economy. take a listen. >> the absurd cost of housing is the result of so many failures and reveals so much about what's broken in washington. wall street barons crashed the economy and american builders went out of business. as tradesmen scrambled for jobs. the lack of good jobs led to stagnant wages.

>> reporter: from econdplis domc issues to war, vance laid out the strength that this administration would have compared to the biden administration. he says they would take on big business. >> we need a leader who's not in the pocket of big business, but answers to the working man, union and non-union alike. a leader who won't sellout to multinational corporations, but stand up for american companies and american industry. >> reporter: tonight is the main event, frank, that's when former president trump will take the stage and he will officially accept the republican nomination. the campaign says he is going to focus on an optimistic future

for the country and what they're calling the golden age for america. >> you know, right now, a lot of spotlight on the rnc, but president biden in the news as well with covid and other news related to the president as well. >> reporter: that's right, frank. we do know yesterday president biden was out on the campaign trail and he actually missed an event because he tested positive for covid. this is just another obstacle facing president biden. he's off the campaign trail now. he's isolating in delaware. this comes among growing calls within the democratic party for him to step aside. it remains to be seen what will happen at the democratic national convention which is just a couple of weeks away in chicago. >> our brie jackson in wisconsin. thank you very much. we have more to come on "worldwide exchange," including the one word investors need to

know today and why the rising a.i. cyber crime. and airlines take a hit ahead of the open and the kickoff to the tech eainrngs season. a very busy hour still ahead when "worldwide exchange" returns. stay with us.

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efficiency. there have been a high number of pro hacks this year including at&t. senators are probing the at&t. one company working to combat the rising cyber threat is gen digital. it beat on the top and bottom line. gen digital, jonas norton lif life lifelock. joining me now to discuss the landscape and the trends in his business is vincent polett. >> good morning, frank. >> i want to go back to the at&t hack. in all fairness, a number of companies have seen hacks this

year. what are you seeing ? more attacks on enterprises or the s.e.c. reporting making us more aware of what is going on? >> definitely, we see a lot of scam threats which increased 40% year over year. it is a result of the data breaches with at&t, but across the globe, over 2,000 data breaches a month happen. when the hackers get their hands on the data, they resell it on the dark web. scammers improvise and have more and more targeted scams. for example, in the case of at&t, my cell phone could have been breached and scammers can reverse engineer from facebook or other social media that we have someone in high school and call my wife and ask for the credit card for the materials that my soon would have booked. those are the risks we see. as we mention with a.i. and the

rise of a.i., the complexity and speed of the threats become more and more increased. >> so that's the enterprise side of things. what about the consumer side? are you seeing a consumer side in security consider so much of our lives in the digital space? >> on the enterprise side, it is all about protecting the cloud. for the consumer, they would be the victim of those hacks in an indirect way. we see three growing needs. the first to protect your financial assets. more of your financial life is online. the second one which is rising is the need and the desire to control your personal data. knowing what data you have, personal data you have out in the digital world and the ability to control is super important. the third one is the need to verify the data and content and the people you deal with online which becomes more and more

complicated. we are shifting our portfolio from what was known in the past to basic security to be really user centric and focusing on those needs and addressing it. >> vincent, one thing is rate cuts later in the year. does that impact your business or ability to sell your cybersecurity services to enterprises and individuals? does that make a difference? >> like all of them, i'm still waiting for rates to come down. i understand that it will hopefully come in the second half. we have seen a stabilizing environment on the global basis with the global economy or inflation coming down to 3%. all of which is really favorable. when it comes to the rate cuts, we are still in the process of paying for the very successful acquisition to give us a global footprint and usually a lower rate would enable us to increase

profits at a faster pace or reinvest in the business. >> that lower cost in capital would help a lot of businesses across the board. vin vincent, great to see you. thank you forbeing here. ceo of gen digital. >> thank you. coming up on "worldwide exchange," helping retail investors navigate the recent market turmoil and teetering tech trade that has been looking at stock gains for the better part of the year. we're back after this. >> announcer: cyber report is sponsored by paloalto networks. cybersecurity network of choice. [a.i. copilot] glad you called, j. [a.i. copilot] it's time for an upgrade. awesome. ♪♪ [inner monologue] i knew what i had to do. because they never stop. no time to waste. this isn't sci-fi. this is precision ai. ♪♪

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welcome back to "worldwide exchange." it has been a tough go for the market accepts the s&p and nasdaq as people shift out of the gains and moving into other sectors. how should you navigate the volatility? joining me now is doug bonaparthe. doug, great to have you here. a lot of pressure. you have to answer the biggest question on wall street this morning. what do we do now? mega cap tech is the trade all year long. we have seen a recent rally with small caps, but mega-cap tech earnings next week. is now the time to trim or rotate? is that what you are telling your customers? >> now is the perfect time to rebalance the portfolio. you have out performance in the

mega-cap space. it is a breath of fresh air to see the smaller caps. do we pare down and focus on other asset classes? >> why do that ahead of earnings? earnings are expected to come in strong. right now, we are seeing a rotation, some of it may be on a trump trade, but also the idea of rate cuts. don't the rate cuts indicate a stronger economy and benefit the same names all year? >> it might. a rebalance might not take everything on the table here. we have watched the mega caps soar for some time. if this is the first time you are addressing this in a year, timing could be pretty good. >> what about bonds? i talked to a lot of traders say they are seeing people lock in long-duration bonds ahead of the rate cuts. bonds to equities?

give us a sense. >> time horizon is super important. i work with older millennial clients with less exposure to fixed income over the baby boomers with more fixed exposure there. that's the trade. why not get paid with a higher yield on fixed income and experience appreciation later on when you see rates coming down. i find it very attractive. it is a rare environment with those two things happening at once. time horizon is big with the exposure. why load up on bonds? >> interesting. what about bitcoin? we have seen bitcoin rally in recent weeks and gold. how do you see the new financial opportunities come up? >> alternative investments with technology with a lot of access. you can get your hands on real estate or private equity. you have private assets which

have not gone anywhere. you can buy an etf with bitcoin. a dip in the $54,000 range and we're back to up $64,000. opportunities happen all the time in the alternative space and digital space. >> bottom line, a handful of stocks move the market higher and not going in an exact straight line. are there certain sectors or areas you would look for single stocks? >> we're by and large a passive shop. we believe in the market doing its thing over a period of time. those are disciplined and consistent with strategy. you don't necessarily need to do that with a single stock pick. we need the consistency and discipline and look for opportunity with the dips in the market. if you are deploying fresh capital, that may be an opportunity or if you are

looking in the market, you look for the dips. >> two great qualities. doug bonaparth, thank you. new life to the a.i. chip trade, but is it enough to halt the rotation out of tech? we'll be back to answer those questions. stay with us.

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bounce back after the steep selling as investors look into the navigation is a flip or broader trend. chip stocks among the hardest hit as the high flying sector faces headwinds. we get a taste of what earnings season looks like with netflix rolls out results. it is thursday, july 18th, 2024. you are watching "worldwide exchange" here on cnbc. welcome back to "worldwide exchange." i'm frank holland. thank you for joining us. let's get you ready for the trading day head. we pick up the s&p and nasdaq looking to recoup some of yesterday's losses. looks like the dow would open 34 points lower.

the s&p is up .25%. the nasdaq up over .50%. yesterday, we saw a mixed session on wall street. nasdaq shedding nearly 3%. its worst day since december of 2022. the dow closed fractionally higher and crossed a milestone. crossing 41,000 for the first time ever. yesterday was the first time since all the way back in 1999 that the dow notched a gain while the s&p fell more than 1%. the s&p actually fell more than 2%. speaking of the s&p, let's get a check on the stocks for that index this morning right here at the top of the list. cardinal health up 4%. followed bydiscover financial up 3%. monolithic power up 2.5%. nvidia in the fourth spot. turning back to tech. nasdaq with the worst one-day loss since 2022. chip stocks leading the charge

higher after sharp losses yesterday. the top gainers in the nasdaq 100 in the pre-market. chip names dominating. nvidia up over 2.5%. followed by amd up 2.25%. the rally back to record highs is anything but certain. the past five trading days, the mag seven wiped out $1.1 trillion of market value. in the vaneck semiconductor with the worst day since march of 202. it is up 2% right now. we have our guest with us. paul, good morning. great to have you here. >> good morning. good to see you, frank. >> paul, let's talk about chip stocks. they led the nasdaq yesterday.

looking at the smh since the start of july, down 2.5%. should investors be concerned? >> there's a combination of trends going on, frank. one is clearly concern over politics. some of that relates to disruption around the geopolitical situation and where chip stocks are based . for example, we had strong results from tsmc which we'll talk about. the concerns with the potential trump administration is weighing on the mains and also a high degree of concentration with the a.i. names in the market which is creating a selloff. this has happened and it is probably healthy and catalysts caused this. if this goes on for so much longer, it will create a buying opportunity. >> we have been doing a lot of talk of rotation in the united states. some money moving into small

caps and transports in recent days. we have mega cap next week. some of the volatility and some of the money moving around will actually move back into mega cap tech ahead of the earnings. do you see investors moving back next week? >> i think it is possible, but it is really important that not only the backward looking aspect of the statements are solid with the revenue trends and earnings, but also forward guidance is firm. that is something that investors will be looking at closely. valuations, let's not forget, have become bifurcated in the section with the names related more to the traditional chip activity such as smartphones and pcss. higher multiples on a.i. there will be some with individual names, but certainly if the outlook, those can bounce back strongly.

>> taiwan semi is getting a boost right now. the company is rising 40% from a year ago with a.i. demand surging. is this, in your mind, is this possibly a sign of what is happening going forward? i know we talked about mega-cap tech, but does this volatility with chips -- does this volatility just end? >> i think the volatility is here to stay for a period of time not only because the market has become so skewed to a small number of names at the large end of the scale, particularly in the u.s., but also as the political noise becomes dominant and certainly with the announcement of jd vance as the running mate for donald trump. that will get investors thinking about how the outlook will look for several years now under a potential republican administration. i think looking at tsmc, that is a case in point. the numbers we are seeing this morning is very strong with the revenue guidance and margin and

in terms of outlook. nonetheless, there is still the ongoing political overhang added by the comments around taiwan. there may be issues for investors to think about and may come to relative of its peers. >> paul, it sounds like the u.s. side, the election variables have not been priced in yet? >> i think that's something which investors will continue to think about. there's a very strong temptation for investors which we have been seeing with the rally from the russell over the last week and some of the selloff in tech to move to those more traditional industries which did very well the last time trump won the election in 2016. those tend to be old economy stocks and financials and metal and industrials and maybe some of the energy stocks as well which should benefit from a more favorable treatment under that administration.

the one-way traffic we have seen to some extent year-to-date, is likely to continue, but the underlining fundamentals with the tech space is in place. >> paul markham, thank you. time for the three stock stories of the morning. united airlines lowers outlook saying it will earn 3$3.75 a share. shares down just about .75%. we are watching warner bros. c discovery. it is looking to spin off from the legacy television network in the eviffort to boost stock pri. it lost $20 billion in revenue in the past two months. the company has yet to hire an investment bank. shares of warner bros. discover

down .30% and beyond meat is looking for the balance sheet. shares are down more than 20% this year. shares this morning down more than 12%. coming up, from top pick to bowing out. the bearish call on the beecitleercyrsury ad crowdstrike. we'll have that and much more when we continue. stay with us.

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exchange." time for the morning call sheet. mizuho upgrading toast. the software company can gain space in the restaurant space and expanding. morgan stanley upgrading gap to overweight. the retailer is one of the few in the sector with a long runway with a positive rate of change under new management. and redburn downgrading crowdstrike down to 275. valuation for the stock is demanding and any disappointment to recurring revenue could see a sharp duration. time for the global briefing. the meeting in china wrapping up today according to the official communication out a short time ago. leaders will look to enhance the market mechanisms in the economy and credit ate a fair and dynam environment. china will have an official news

conference tomorrow. the ecb is expected to keep rates on hold with the decision due out at 8:30 a.m. eastern time. it's a mixed earnings picture today. nokia sliding after the second quarter profit fell by .30%. novartis is lower as it raised the profit forecast for the second time this year. frasers is surging which beat forecast and sees more growth this year. also pulicis is raising second quarter revenue. coming up on "worldwide exchange," we have the one word that every investor needs to know today, plus, getting set for netflix earnings. we have the keys to watch in the streaming giant results as the stock continues with a solid year so far. we'll be right back after this break.

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good morning. good to see you. >> good morning, frank. good to see you as well. we'll bullish about the report coming out tonight and excited to listen to the call, for sure. >> very excited to listen to the call. what are you looking for? subscriber growth is an important metric and average revenue is another key one. are you expecting to see similar help from the password crackdown this quarter? >> we do. t we feel there are four accelerants. our view is they may do a billion this quarter which would be the biggest quarter they've seen in their history which translates to $4.80 a share. we are looking for what greg peters has been talking about on these calls, the ceo. they want better profit margin growth. that's a different story.

they're maturing as a business. they don't want to talk about subscriber numbers so much. that's why the hit last time. ad revenue which is a new thing for them. it increases more than expected. mitigating password sharing. i know my kids hate it, but it's smart and brought revenue up. are they getting more subscriptions overseas? we think those four accelerants bring better numbers. >> on this stock, it is expected to see a 7.5% move to the upside or the down side. as someone who holds this stock for a number of clients, how do you see that earnings coming up? is this something you want to add to ahead of earnings or trim because of the implied volatility? >> you know, i love that it's on that list. i would agree that it is probably going to go one way or the other. i say it's going up.

however, if you look at last quarter, they beat on the top and bottom line. stock went down 10% -- i think it was 9% and rallied 20% higher the next few months. if i owned it, i would definitely keep and hold it. if it came out and the numbers are good, but the stock weakens, like last quarter, you want to be a buyer. here is 26 times earnings spread. it hasn't been as cheap as a multiple. gosh, i can't remember the last time it was 26 times earnings. great opportunity to own it if you already have and if you don't, buy on the weakness. >> james, i know you are saying 26 times forward earnings of the our data is 33 times forward earnings. i understand your argument. you see a lot of upside in the stock. james demmert, thank you very much. coming up on "worldwide exchange," why our next guest is pulling back on the bullish

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welcome back to "worldwide exchange." time for the "wex wrap-up." jd vance accepting the nomination for vice president last night.

vance using his keynote address to blast wall street. >> the absurd cost of housing is the result of so many failures and reveals so much of what's broken. american builders wos went out business as tradesmen scrambled for jobs. the lack of good jobs, of course, led to stagnant wages. more party members are calling for president biden to exit the race with the current events on hold due to contracting covid. and darden buying chuy's for $605 million. shares of volvo jumping overseas after the record operating profit for the second quarter. volvo cutting the full-year

retail sales forecast blamed on evs made in china. and discover earnings crushing the street expectations with the higher rate environment helping the credit card company earn more interest income. here's what to watch today. we get the jobless claims and the philly fed speaking before the open. on the central bank front, latest rate decision from the ecb later this morning. back here in the u.s., the fed's lorie logan is speaking today. we look back to the market and the dow sitting above 41,000 for the first time ever. look at futures. still a mixed picture. the dow would open 34 points lower. the s&p up just .25%. the nasdaq is moving higher and more than to note off the highs of earlier today. let's bring in greg branch at branch global advisors.

greg, great to have you here. >> great to be here, frank. >> let's talk about today shaping up. we mentioned the nasdaq pressure yesterday. what is your "wex" word of the day? >> today is what we expect as we are looking at the cross currents. we don't know if the rotation is permanent and we are working that out. we are trying to work that out and work out if protectionist policies being espoused winner of the election, would take hold as well. it is good for small caps which generate a small number of percentages overseas. we will be mixed for a while >> you went to mixed? greg, you are known to be a bear. you could have thrown something bearish in there after yesterday. i have talked to a lot of traders and they believe the rotation out of mega-cap tech

will change next week with the earnings. >> it might. the net net is we will have a great earnings quarter. right now we're at 9% as the quarter seasons is likely to get to 12% to 13%. that's the highest growth rate we have seen in two years. tech will lead. communications services will be driven by alphabet and meta. information services will be driven by nvidia and we'll probably see 17% to 18% there. earnings will support the current leadership. the whole quarter overall will be great. >> greg, the whole quarter? >> i'm not a perma-bear. >> i'm giving you a hard time. i want to lean back a lbit. we saw small gains with transports. all year long, we heard small caps rally. it is based on two things, the

fed cut and the economy staying strong. is that a soft-landing scenario or is there another opportunity? >> in order to see it as a safe scenario, you have to look through what we have to go through and the reason the fed will cut which is the environment is going to become more hazardous. yes, the fed rate cut shoolves balance sheet problem, but creates a revenue problem. what it also does is it means the demand will soften as the result of the 500 basis points we put up. you don't get one in terms of declining inflation without the hazard. we are sorting through this and the key word of the day is versatility. we are looking for things that tie into our old themes, structural, supply and demapnd and balance and secular tailwinds. we are looking at shipping where rates were five times last year.

there is only one american company and you can play it which is a small-cap exposure. we lookminers. >> i want to ask as we show the chart. maersk down 5%. i agree with you. container shipping prices are going up, but investors are selling off on these names because global demand is lower. why would you want to invest in these names now with consumers under pressure in the u.s. and other parts of the world? >> because there is another vector that will overpower that. when you have rates five times what they were last year, you will see impressive earnings growth in the third quarter and fourth quarter. they cannot build capacity to come online soon enough with the red sea congestion which is lengthening shipping times.

>> maersk just flagging they continue to have to go around the cape of good hope and cannot continue to take the red sea. interesting picks, greg. definitely not a perma-bear. before we let you go, it is a mixed picture right now. looking at the dow, it would open 50 points lower. "squawk box" starts right now. good morning. chip stocks regaining ground after yesterday's selloff. we'll show you what's moving right now. president biden isolating, self isolating in delaware after testing positive for covid. this comes as pressure is mounting for him to drop out of the raice. and senator jd vance took center stage last night at the rnc. we will show you his comments. it's thursday, july 18th, 2024.

"squawk box" begins right now. good morning. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. yeah, here we go. it's a thursday. there was a lot of activity yesterday. you actually had the dow closing above 41,000 for the first time ever. this morning, it is indicated down 44 points. s&p is down 8 and the nasdaq up 62. this comes after the dow was up 244 po4 points to hit the recor high. the s&p was down 1.4%. the nasdaq was the big loser. it was down 2.8%. this was the biggest decline for the nasdaq since