global headquarters and here is your "five@5." ceo elon musk is addressing the doubters. -- in disbelief -- it should sell -- >> shares of alphabet under some pressure. the ceo doubling down on the importance of spending cash right now.

>> it's dramatically a greater risk. >> one day, $1 billion. strong debuts for the first five either etfs, but still a long way to go before hitting the levels of bitcoin funds. wee going to look at the impact of politics on crypto. plus, the small kap bounce back. we're going to look at the factors weighing on one of the biggest champagne and jewelry brands in the entire world. it's wednesday, july 24th 20rks 24. you're watching "worldwide exchange" right here on cnbc. ♪ good morning. welcome to "worldwide exchange." thanks so much for being with us. w we check on the futures. the s&p and nasdaq both coming down. take a look at futures.

you can see a lots of pressure in the market and premarket. it looks like the dow would open more than 200 points low e. the s&p is down half a percent. it's the nasdaq we're watching this morning, down more than 1%. so the heavy selling pressure, it's tied to directly to big tech earnings. we're talking alphabet and tesla. alphabet down more than 2.5%, tesla, down more than 6%. we'll talk more about both of them this morning. we're also talking about the russell small caps. taking a look at futures this morning, you can see right here. a bit of a slide when it comes to russell. down a third of a percent. we'll continue to watch this with our show. a lot to watch when it comes to market caps as well. we're talking about the market ahead. that's pce taking a look at yields right now. we're going to look at the benchmark tenure. not a lot of movement. we continue to watch this move when it comes to yields and how

that could impact the markets and we're looking at energy, particularly owl. this morning oil moving higher. remember, this is a relative move. oil has been sliding in recent days. right now wti is up three-quarters of 1%. it's below what's a key level. similar story for brent crude. below 82 bucks a barrel. that's your morning setup. both stocks, alphabet and tesla falling. tesla set to turn negative for the year, but we want to start with alphabet. senior reporter arjun kharpal reporting from london. shares of alphabet, they're lower. was that a miss on youtube ads or is something else weighing in on it? >> it was an interesting

quarter. alphabet showed they were the advertising juggernaut in the room, firing on all cylinders. if you look at the revenue, 87.4 billion total, up 14%. it beat on earnings as well. the problem was, expectations in terms of youtube as well was $8.66 billion. this is a stock that's risen 30% this year. the expectations were high coming into the earnings, meeting those expectations as the company had done, was just not good enough. there needed to be a big beat especially as the market is reevaluating more broadly the tech sector and has continued signs of that rotation as well. i think the pullback in the premarket is not too dramatic but really underscores that sentiment. the cloud business surpassed $10 billion of quarterly revenue and $1 billion of operating profit in the quarter for the first

time. alphabet management saying on the earnings call, quote, generative ai solutions for cloud customers have generated billions in revenues, and the 31% year on year rise has been display inned while spending and growing revenue. that's something investors have been asking for a long time and have wanted to see for a long time for the company as they continue to invest in ai. i think this was about high expectations for this advertising giant, frank. >> yeah, really high expectations. it'sing are interesting. normally this stock would trade higher on the cloud beat. arjun, we're going to shift gears, bad pun made. we're going to go over to tesla's growth auto margin. what are some of the o'factors moving the stock lower. it was a big miss when it comes to the number. >> another bad pun, buckle up. auto margins was a big deal as you mention with a figure coming

in at around 14.6% as it continues to false. tesla continues to slash prices off of discounts amid the rising competition, especially in china as well as a lack of refresh of its portfolio of cars. at the same time, expenses are rising as tesla invests in the future of ai, robotics and more. that's what a big part of the earnings call was really focused on. robo taxis. this idea that tesla owners will allow their cars to be used as part of the uber-style service, must push back the date from august to october. he also said he would be, quote, shocked if tesla couldn't do the first robo taxi ride next year, adding that he doesn't think regulatory approval will be an issue. mus

also said it's doubling down. the other bright spot was the energy business. there's been a battle playing out however more broadly in the market between those who are focussed on tesla's fundamentals as an ev carmaker, which are under pressure, of course, and the hopeful that tesla is the future of autonomy. they're focused on that. >> all right, arjun kharpal, senior tech correspondent. thank you for the latest on both of those big tech earnings out of london. we'll be talking more about the road ahead for tesla -- also bad pun -- and thank you very much. time for our other corporate stories. silvana henao is here with us. good morning. >> good morning. i don't have any bad puns. we're going to stick with ee musk. he plans to donate $45 million per month in a super pac to help

get trump to the white house. musk saying the report was simply not true and he wasnot donating that amount. musk later taking to his x platform to clarify he will make donations to the pac, but at a much lower level. openai shaping up its leadership, sources telling cnbc the company last week removed top safety expectation alexander ma drink from his role, reassigning him to a job focus on ai reasoning. ai did not immediately respond to a request for comment, the apparent move coming shortly before a group of democratic senators sent a letter to openai ceo sacramento altman on questions about safety concerns. and the faa is launching a broad review of southwest airlines. the move stems from a series of recent safety incidents involving the airline including a flight that descended to low

altitudes too early and another that took off from a closed runway. a spokesperson for southwest says the company is working closely with the faa in this review, frank. >> a lot of recent issues involving planes and air travel, which is very interesting, especially in the hate of the travel in the summer season. >> right, right, right. we have a lot more to come on the show including the one word investors have to know, plus the tesla selloff. heading into the report, the shares may have got up too far, too fast. and later how crypto became a battleground for the 2024 presidential race. we have a very busy hour still ahead when "worldwide exchange" returns. stay with us.

jo w . wks /* welcome back to "worldwide exchange." the s&p down over half a percent. it's the nasdaq moving much lower off of its lows earlier, still down 1%. earnings, moving across the pond. we'll see how things shape up as the trading day gets underway. we have much more with carolin roth. good morning. >> good morning to you. the earnings failed to impress

investors across the board. i want to take a look at the xetra dax, down 0.9%. deutsche bank was up 2% on the year and narrowly ahead of expectations in its investment banking position chlg what you're seeing is a slump of 6 6.5%. why? probably taking some. let's take a look at the banking sector. we had numbers from bnp paribas in france. second quarter net income rose 1.6%, just under 1.3 billion euros while revenues jumped. this stock has been weighed down by the political uncertainty in france. staying in that country, we have to talk about lvmh, because this luxury giant recorded a second quarter miss on the top and

bottom line. sales only grew 1%. i need to kind of zero in on the japan/asia numbers. revenue down 14%. investors are so concerned about this. shares off by 4%. i roy ple to show you the luxury sector overall in europe because we had a big knock-on effect here. over the course of the last two weeks, we've seen really bad numbers from the luxury giants on the back of weakness in china. hugo boss down 4%. carrying one of the biggest rivals here to lvmh falling to 3%. back over to you. we turn our attention back to u.s. margins and earnings. tesla and alphabet weighing in. you see tesla down more than 7% right now. alphabet down more than 3%. both hitting their lows of the morning.

we have a lot more big earnings today. that including at&t, ford, chipotle, and ibm. joining me now is a funder and member of the cnbc financial advisory panel. good morning. great to see you. >> good morning. great to see you too. >> everybody was saying earnings season, especially when it comes to big tech and the ai trade, it's show and prove time. we need to see it. are you worried the tech sector may not live up to these lofty expectations, and if we're worried about it, what are the market implications? >> i'm not so concerned. what we're seeing is they're growing their earnings. trees don't grow to the skies. they're not growing them as fast as they had been in the past. tesla's problem is they're not selling enough cars. that's not so much a tesla issue. they're not selling as many cars as some of their competitors, but google and alphabet, you'll see the same thing with amazon

and microsoft. they're making money. that's a silver lining. if you look at the cpi numbers, they drop by 1.4% and that's coming right before the foc meeting in september. that makes it more likely for the fed to start cutting interest rates. when that happens, that's good for the tech base. >> i want to go back to that. they had a miss in the ad business, the ad business becoming a beggar part of the business for amazon and microsoft. also meta. you can't forget that. the primary business for meta. and alphabet said something that caught a lot of o investors' ears. they continue to spend on capex. 12% guidance for the quarter. but also hyperscaleable capacity is getting built? is it is a concern? >> it is a concern. roy's funny, it's consistent

with what we're seeing with gdp growth. it was 1.6%. it's decelerating a and that's reflected in the ad growth. that shouldn't be a surprise. again, the silver lining is whenever we have economic growth that starts to decelerate, the government spends a lot of money. we have 7% deficit spending right now. it's like we have helicopter parents for adult children, so i think the government is going to step in. that's why i'm not worried about recession or earnings because i think that will get filled in by public pending. >> taking a look at futures, it looks like the dow would open up 200 points lower. our data team put out a great chart looking at the earnings growth and the mag 7 compared to the rest of the market. according to their calculations, the yellow line is the mag 7, the blue line is basically the s&p 500493. the earnings growth of these mag

7 stocks are going to decelerate in the coming quarters and years. are you worried that may be the start of the decline and do you want to diversify your plays or do you have confidence and investors should continue to push on that? >> let me back up. you saw the winners, you buy the losers. you see that with the small caps. they're starting to do well. but there's one caveat, and i keep talking about the liquidity and the debt because they have to monetize this debt. this is what's different for tech is that tech does really well when you expand the balance sheet, whenever there's liquidity. so even though earnings are going to plateau and they've been driving the market is as liquidities start to increase, things like bitcoin and nasdaq outperform the market relative

to how they dilute the currency. >> ivory johnson, great to see you, great conversation, always appreciate your time and insight. >> good to see you frank. for more what's droving the markets head over to c cnbcpro.com/pro for insides and analysis. coming up, shares and a revenue miss and a big money mover. stay with us. welcome to the now way to network... they switched to juniper's ai-native network. now everyone's so productive, they're operating at a higher gear...

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welcome back to "worldwide exchange." time now for your big "money movers." we're going to start with shares of texas instruments. they're moving up over 2.5%. there's a 5 cent increase to eps, strengthening in the business. shares of visa under pressure. shares are down more than 3%. signaling a slowdown in overall buying growth this month, especially debit compared to credit. it expects higher currency volatility and expects a recovery from asia due to weakness in china. enphase pops despite earnings miss. demand is starting to turn a quarter and will no longer undership products to turn over inventory. turning to crypto.

spot ether etfs trading. we're joined this morning. mac, good morning. great to see you. what are you expecting in the days ahead? >> so, frank, those brand-new spot etfs made a big splash in their u.s. market debut, over $100 million in trading volume on the first day. we don't know if that's money flowing in or out. it's still a strong start with many of the funds now make the list of the top 50 highest trading etf debuts of all time. this comes six months after the blockbuster bust of bitcoin. it's seen $17 billion in inflows. citi expects somewhere between 4.7 to $5.4 billion for inflows of ethereum effs over the next

six months. it's lower. it's one third the size. frank, a lot of attention is turning to stolana and whether that's the next one to get the eff treatment. >> so, mac, you do so much great coverage of bitcoin and cryptocurrency. you're in nashville for a huge bitcoin event. president trump is expected to speak. there are reports that vice president harris has also been inv invited. what do you say about all of this and the 2024 election amend crypto being the headlining issue? >> trump speaks on saturday. yes, frank, there was speculation fueled by the conference organizers their we in talks with vice president harris to come speak as well. it looks like it's not happening. while it wul still a responsibility, i spoke to people on the ground to get their take on a harris versus

trump race in november. i asked about her record in california, whether her open trade policies would sway them. they appreciate trump's recent about-face on crypto, the fact that his campaign started accepting donations and tokens in may and conversations he held in mg and he wants to defend the rights of those who choose to self-custody their coins, meaning they don't have to hold it on a platform like coinbase. these are popular topics and important for people, frank. >> the president headlining a bitcoin event. who would have thunk it. great to see you. as we head to break, we're watching shares of u.p.s. coming off their worst day of record. ekares down more than 12% this we. we'll be right back after this break.

it's just about 5:30 a.m. in the new york city area. here's what's still on deck. markets are set for another rocky trading day. futures are dragged down by another hit of quarterly results. alphabet beatses on profit d investors, but that it's not enough. and a similar story for tesla as rates earnings miss as elon musk once again makes a push for

investor patience on a number of ev makers. it's wednesday, july 24th, 2024, and you're watching "worldwide exchange" right here on cnbc. ♪ and welcome back to "worldwide exchange." i'm frank holland. let's get you ready for your the trading day ahead. we pick up the half hour with u.s. stock futures. take a look. in the red across the board. the dow down more than 230 points. s&p down by 46 points, nasdaq down more than 200 points. you see tesla down 7.5% followed by alphabet, down almost 3.5%. visa in the third place spot on this laggard list, more than 3% as well. we're going to be talking about tesla in a moment.

alphabet in just a bit. this morning we're also watching small caps. closed out more than 1% yesterday. this morning we're seeing a bit of a pullback. the russell pulling back about a third of a percent. we'll be talking much more about the small caps throughout the show. this morning we're checking the bond market as we await the key ecp inflation all right. yields pretty much steady. 4.3%. not a lot of movement, but we'll watch that. also energy this morning looking at oil hitting its lowest level since june. keep this in perspective. oil is higher. similar story for brent crude. overall it's been a tough few days for the oil market. trading at $77.65 a barrel. brent crude at 81.73%. that's below that level of 82 in recent days. moving higher, but we see a pull

back in recent days. that is your morning setup. as just mentioned, shares of tesla, they're sliding. earnings missed estimates. it's the fourth straight miss and the biggest since 2021. tesla reported its lowest profit margin in more than 5 years. it boosted demand but looked at the technology. on the conference call ceo elon musk said they're investing in the wrong company. >> the value of tesla is autonomy. i recommend anyone who doesn't believe in autonomy should not look at it. they should sell their tesla stock. >> sharp words. let's bring in garrett nelson.

good morning, great to have you here. what did you think in what you saw and heard from the call and the report. did it chamg your price rating or target on tesla? >> no question it was a disappointing earnings release. they missed by 10 cents. this is the fourth straight quarter that they've missed. you know, in the aftermath of the earnings release, we've downgraded the stock from a buy the a hold. our 12-month price target is now $240. the stock was up almost 70% in april. you know, in light of that and also what we think is a lack of near-term catalyst here with robo taxi day having been delayed a couple of months until

october, there's really not much in the way of near-term developments, we don't think, in the story. so we felt it was appropriate to move to a hold, and we will revisit that rating in october. >> we're going to get to the road ahead for tesla in just a minute i use that pun one more time. our data team working overtime. i want to show you the chart. the slide we've seen in gross auto margin, how concerning is that? really, margin, that's where we have the advantage over other automakers. >> it is concerning. it's a reflection of ev pricing that's come down in the past year and a half and also the recent launch of the cyber truck. any time you launch a new model, especially a niche product that's a cyber truck that's more difficult to mass produce than the model 3 or the model y, that's going to weigh in on

margins overall. they haven't yet hit the point of profitability on the sooner truck. they're continuing to ramp that up. that's really weighed on margins. long term, we still like the story. we think there's significant margin expansion over time as they sell more full self-driving subscriptions and as they continue to improve their product importantly software sales are different. >> i want to go back. tesla's not the stock for you. it sounds like you actually agree. coming up, you say there's no year-term catalyst, coming up, robotaxi month coming up. a $25,000 tesla possibly in the first half of 2025. and a robot used for external

use in 2026. does elon muffing have a point, if you're a tesla sharmd, you have to give it some more time? >> we agree actually. you know, you really look at the near term and the intermediate term. i'm talking looking out two to three years, there's not a lot of clarity as far as earnings growth and you're seeing estimates come down, not increasing. until we get more clarity on what the intermediate term looks like, you know, we think it's a hoechld we think you're going to get that come october 10. but tesla is a storied stock. it really relies on a steady stream of positive catalyst. elon musk has talked at length about what they're doing with robotics, ai, robotaxi, energy storage. but lot of these are really long-term drivers. we believe in the story longer

term, but there's just not a lot of visibility or looking. >> you said it ran up too far, too fast. it's pulled back, trading at 228. do you think this is a good level or after that run-up this is still elevated? >> so where the stock is trading premarket, that's some upside to our target of $240. but we think it's a hold here, kind of taking a wait-and-see approach, we think that's the right approach for investors. >> garrett nelson, great to see you. great insights. coming up on "worldwide exchange," the european luxury slowdown continues with lvmh being the latest. shares down just about 3.5%. first we want to get to some of your top trending stories. legos is bringing the battle to life. the toy maker out with its first lego setses including a kit for $100 using iconic characters and

vehicles from the original game. also, there could be a thrill never the bidding room. a collection of art by michael jackson is heading to auction next month. they're signed by jackson and are set to sell between h 100 thors. apple's first photoable iphone could hit the shelves by 2026. they're looking to flatten the folden crease and ke tmahe phone thinner. "worldwide exchange" is back right after this. then i found a chance to let in the lyte.” discover caplyta. unlike some medicines that only treat bipolar i, caplyta is proven to deliver significant symptom relief from both bipolar i & ii depression. and in clinical trials, movement disorders and weight gain were not common. caplyta can cause serious side effects. call your doctor about sudden mood changes, behaviors, or suicidal thoughts right away. anti-depressants may increase these risks in young adults.

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welcome back to "worldwide exchange." time for your morning call sheet. goldman sachs raised spotify's price target, goldman citing the q2 results should build in the second half of the year. piper sandler downgrading its target from 494 to $404. piper sandler saying it does not think it's enough to offset the several sources of market dilution for the company. another retailer getting a downgrade. boot barn. it's lowering its price target down to 125, ubs saying is expects trouble and it has a more bearer macroview.

lvmh is declining after second quarter sales growth largely due to weaker luxury spending in china. other european luxury stocks in the red. gucci owner kaying down more than 3%. the others are all arch more than 1%. and it's not just the luxury sector under pressure in europe. the german lender reports its first quarterly loss in 2020. it's taking a provision on a long-running legal dispute following the takeover of post bank. b np paribas falls despite the drop in the net interest income. coming up on "worldwide exchange," the one word that every investor needs to know today, plus an earnings and revenue beat by alphabet.

you can she shares are down by atre than 3%. wh's sending that stock lower. we'll be back right after this break.

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gamechanger. vice president kamala harris is the presumptive nominee. she raised more money than any

other delegate. they're engaged and organized. we cannot assume a republican sweep. >> you can't aassume a republican sweep. what do you make of the rally of small caps. of course fed cuts are a factor. some think that's been part of the so-called trump train. the fact that they're smaller and higher, what do you make of that? >> i a agree. clearly they're front and center. investors expected an easy trump win and that may no longer be the sentiment. listen, trump, onshoring is expected to benefit smaller domestic companies. >> what do you make of the earnings that we saw? big miss from alphabet. the shares are still moving lower right now. one thing they missed on youtube ads, also they're spending a lot for another quarter to build out their hyperscalers.

what's your view of either report? >> listen. we're talking about the magnificent 7. so we're talking about this kind of broadening of leadership of the market. i'm not ready to give up on big tech. i think ai is going to continue to drive ai and technology is going to continue to drive those. again, nevertheless have we seen a better case for diversification than last week. you know, we were seeing, you know, small caps overtake large caps and cyclicals overtake tech. the best defense is a diversified portfolio. >> i want to get to your pick. lvmh. what do you see of their stock after they pulled guidance and said things are pretty unclear? >> listen, they had slowing in china and a little bit of an inabout crease. but that china piece is really, really big for them and they're

definitely down on the earnings news, but, listen, i'm still a believer in the stockmarket. they're a strong market leader. they've got pricing power, upscale. >> tiffany mcghee, great to see your pick. one more look at futures we've seen all morning long. in the red across the board. under pressure. that's going to do it for u us. "squawk box" starts right now. good morning. tesla, the shares falling after earnings missed estimates for the second straight quarter, pretty big decline in earnings. we'll show you whatelon musk said on the call. google parent alphabet lower and youtube fell short of expectations. and luxury stocks are tumbling in europe thanks to a slowdown in china. details straight ahead. it's wednesday, july 24th, 2024.

a "squawk box" /* begins right now. ♪ good morning, everybody. wng to "squawk box" right here on cbc. we're live from the nasdaq market site in times square. i'm becky quick along with joe kernen. andrew is off today. let's take a look at what's been happening with u.s. equity futures. you see there are some big declines. why are you looking at me? >> it looks like i enlisted yesterday with the stripes. >> nice cut, nice cut. i'm getting one today. >> are you? >> yeah. >> different for you. >> longer. it takes a heck of a lot longer. >> it's a styling thing. this was necessary to cut the gray off. >> trust me, this is necessary too. let's take a look at the markets too. quite a bit of weakness. the nasdaq is off by more than