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tv   Street Signs  CNBC  July 29, 2024 4:00am-5:00am EDT

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anyone who's known him says there will be a second act. and their -- the predictions of people who have known him over the years is the second act -- captions by vitac --
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forward. in europe, we see a different picture. we see consumer sentiment picked up. we also saw good sales growth on the consumer side in europe than on the healthcare side which is mo modest. it is in line with the last quarter. i would say there is no significant change in momentum on the healthcare side. >> the quick check of the asian trading. the nikkei 225, week to date, 2.13% to the upside. we saw the yen strength coming through and that put a lot of pressure here. this is today's close here . it is up by 2.13% today. the boj meeting coming up. we have the industrial products from china. we will get an update from
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singapore later on. we expect a pop at the start of the trading session with the s&p 500 up and the nasdaq seen up 77 points. i want to show you the close as well. on friday, we did see the rally on the back of the pce data. dow jones industrial average is up 1.6%. s&p 500 adding 1%. the nasdaq bouncing back after the weakness we saw in the course of the week. i want to show you the weakness. the nasdaq after the disappointing numbers from tesla and alphabet, nasdaq is off 2% for the week. we saw the continued rotation out of the tech stocks into the russell 2000. i want to show you the russell 2000 for the week. up 3.41%. year to date, that index is up by roughly 11%. it is set to be a busy week
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on the monetary policy front with the three central banks set to discuss interest rates. silvia. >> i want to take you to the monetary policy. it will be a busy week. i want to start looking at the federal reserve stateside. we expect the fed to keep rates on hold at the 23-year high. however, investors will look for clues when the federal reserve will be in position to start cutting rates. at this stage, expectations suggest the fed might announce the first cut in september. of course, let's see what commentary we get from the fed this week . in recent weeks, however, jay powell made the comment about how the fed feels about the easing in terms of inflation state stateside. he said you waited too long. just to give you an idea, in
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terms of the latest cpi print from the united states, it came in at 3%. inflation has eased. it is still not at the 2% level. is this the moment when the federal reserve will feel comfortable to start cutting rates? we'll find out. i want to take you to japan as well. when you think about the bankof japan, the narrative is totally different. at this stage, the market suggests a 63.6% chance of a hike. this after core cpi out of japan came in at 2.6% in june from 2.5% in may. we are seeing inflation accelerating in japan. at this stage, expectations suggest we could see a hike over there. here in england, the bank of england is also due to meet this week. however, it seems it is a very close call in terms of what the bank of england is going to do this week. at this stage, slightly higher chance, 52% chance of seeing the
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bank of england cutting rates this week. to give you an idea, prices in the uk rose in june. the inflation eased here, but however, will we see the bank of england cutting rates? when you think of commentary from the officials from the bank of england, they see it as a mixed picture. some suggest it is too early to actually start cutting rates. others, however, believe it is time to start normalizing the policy. let's see what's going to happen. carolin, a very busy week, but also very exciting one on the monetary policy one. >> super busy and super exciting. let's look at the dollar crosses ahead of the moreimportant meet. the sterling-dollar at 12128. we saw the unwinding of the carry trade. that stopped on friday. the dollar-yen changing hands at
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153.73. let's get more analysis from the fx strategist at ubs. thank you so much for coming in today. a very busy week. we got to kickoff with the yen. that was the story the last couple weeks. the three-month high against the u.s. dollar. the big unwinding of the trade. what was behind that? >> thanks for having me. yeah, it was in may or june of the carry build up where the yen was weakening on the back of the speculative moves. that was different from the start of the year with dollar-yen raising. when you have the carry build up in markets, the proper and prompt response starts to rise significantly. the softer cpi print in the u.s. was the time to intervene. you have a series of unwind. that was the risk with the boj
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this week. >> the bigger question is and if you take a look at the moves and showed you the tech stocks before, to what extent are the tech stocks and sell that we saw th there, to what extent is that unwinding with the carry trades? >> you do have, indeed, the yen strength which corresponds to risk off. it is the major driver in the direction of travel. things have basically normalized a bit now. we need to have additional moves coming from the japan side of things with rates higher on the back of the surprise which is not our base case or rates being re-pricing more dovishly in the u.s. we think 152 or 153 is the occasion to buy the dips. >> what happens on wednesday? >> we have the base case for hold. i know expectations is split and
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basically with speculative moves there. we have a base case for a hold there. >> what will the doj need to do in terms of signaling to make sure that the yen continues to strengthen? >> we see that there's been f y you think about it, the first one was coming from the swiss side of things which triggered the unwind with the swiss cross. this time it is on the yen legs. they want to be careful and address markets and push back against the speculators to not incentivize and chase yen weakness in the volatility. >> the verbal intervention and actual intervention which proves to be costly. i want to talk about some of the other crosses here. let's bring up euro-dollar
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again. you changed your outlook. how so? >> we actually raised from 105 to 1081. basi basically flat for the rest of the year. we know investors are incentivized on the dips on the back of the shift in fundamentals. when you look at the broad based balance, it is healthier compared to 18 months ago. we think the negative sentiment was slightly overdone and this is why we actually get 105 or 106 for the euro-dollar t. it is difficult to see euro-dollar rising with the low yield relative to the u.s. this naturally brings back investors to chase the dollar as a safe haven or defensive or high yield currency. >> there's been a lot of concern of the strength of the u.s. consumer. do you think this is something that can weigh on the u.s. dollar going forward? >> it is probably more like a
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2025 story than for the rest of the year. we still have two cuts priced in for the year which is more a little bit hawkish. >> let's also talk about the pound-sterling. a big meeting and it's very finally balanced. what is your outlook? >> we expect a cut this week. however, the thing is we also know that there's a lot of uncertainty of the trajectory of rates in the uk. the boe is not inclined to let the market re-price the curve to dovishly. they still need more data to confirm they're on the path to proceed with the cutting cycle. that brings natural support for sterling. we have euro-sterling at 83 cents. >> very heavy long positions, but also in pound-sterling. what does that mean for the volatility in that currency? >> it is true there's been a radical shift in positioning. we come from starting in 2023
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and now investors having a bit more bullish sentiment. that basically creates a short-term risk, but still not an environment with sterling under significant pressure. >> finally, you got a call on nokia? >> this was kick started by the weaker print in norway. we stand to be also negative for the currency. we are standing on the band of the 11 or 12 range. we thought it was a good occasion to proceed with the likes of strategy because it tends to have strong tendencies. we chase the upside on the back of the moves which have gone too far. particularly where the sentiment should shift in the fx market. >> all right. when you talk about that, you
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say it is a risk-on currency, it is a risk-on currency like the kiwi-dollar. what is the outlook here? >> we still have the positive developments happening in australia. on top of australia obviously being in the environment where higher for longer narrative will be a longer case where it is pushing the aussie higher. also valuations to see the carry with the interesting risk premium. >> literally taken a trip around the world. it has been fun discussing with you. thank you so much for coming in. >> thanks for having me. let's get back to the earnings. merck raised the full-year forecast ahead of expectations for the second quarter. they cited a strong operating
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performance in the healthcare and electronics division. shares up 3.35%. in the uk, pearson posted a profit in the first half of the year and it is on track to meet the forecast for the full year adding it will look to expand in key areas of early careers. coming up on the show, uk chancellor rachel reeves says the labour government will be pro-growth and pro-business, but will reveal a series of spending cuts. don't miss that conversation. your business. take full control of your brand with your own custom store. scale faster with tools that let you manage every sale from every channel. and sell more with the best converting checkout
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welcome back to the show. growth in chinese industrial profits picked up in june at 3.6% on the year. that was well ahead of may's growth at 0.7%. the robust data comes despite signs of the slowing economy which missed expectations in the second quarter. meantime, georgia prime
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minister giorgia meloni started her five-day visit to beijing on sunday. this came after they pulled out of the belt initiative last year. sam vaddas filed this report. >> worries about overcapacity which have been squeezing margins. exports are holding up versus the demand side. the numbers kickoff the data with the july numbers coming through this week with the latest pmi numbers. the pboc surprised the market last week with the rate cuts, but the market does seem encouraged. chinese blue chips extending losses in the session as investors are cautious about growth. the market tunsrns attention to
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week for the meeting which exceeding the second half of the year. on the diplomatic front, italy's giorgia meloni is in china trying to hit the reset button on the relationship after the country withdrew from the belt and road initiative last year. this is aiming to see to cushion the fallout from that and clear up misunderstanding. the two sides agreed to cooperate on evs and energy. they are talking about bringing another automaker to the country on top of stellantis. in singapore, sam vadas, cnbc business news. uk chancellor rachel reeves tells cnbc that the labour government well be pro-growth and pro-business. reeves is preparing to discuss
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this today where she will reveal the public audit of finances. the uk treasury is expected to cancel some road and rail projects in order to plug an estimated 20 billion pound black hole. this is ahead of the audit in september. steve spoke to the chancellor on the sidelines of the g20 meeting of finance ministers and asked her about tax increases. >> we were very clear in the manifesto there have been no increases of income tax or vat or we would freeze cooperation tax at the current rate for the duration of the parliament. it was important to do that because working people have already seen big hikes in the tax the last few years especially with the freezing of tax thresholds. we made it our number one priority to grow the economy. i want to give businesses that certainty about the rate of which the profits will be taxed
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when they make profits. that's really important and unlike previous comments, we will be sticking to the pledges we made in the manifesto. tax policy is rightly a matter of budgets. it's not going to be a budget this week. this week, we are announcing the spending inheritance and the emergency measures to get to grip on those spending pressures. issues around taxation are rightly for the budget and taxing for working people to be lower. unlike the last government, i'll not make any announcements on additional spending or taxes without saying where the money will come from. i have been clear with the fiscal rules. balanced spending to get debt down as a share of gdp. we need to grow our economy to bring long term prosperity to the uk. >> chancellor, i've spoken to as
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many financers who want to invest. they are concerned about the treatment of capital gains. they want to invest in the uk and build businesses, but they want to know they are not penalized. can you put their minds at rest now that they will not see increases in the capital gains taxes when they exit assets that they built up in the uk? >> i want taxes to be as low as possible. unlike the last government, i'm not making announcements without being able to keep them. i'll be setting out the date for the budget and our statement on monday. it will be the budget where we make announcements about tax. the number one mission of the new government is to grow the economy. to grow the economy, we need to attract wealth creators to britain. i'm mindful of that.
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we can't tax and spend our way to higher growth and prosperity. we need to attract business investment to do that. we want to make sure we've got a competitive tax system. it is also why in the first three weeks in this role, i announced reforms to the planning system to get britain building again which is crucially important to get investors. we created a national wealth fund into industries in britain. it is why we've announced r reforms to the pensions system and a pension bill next year to unlike the private investment in pension funds in uk infrastructure and fast growing british businesses. this is going to be the most pro-growth and most pro-business treasury this country has ever seen because it is only through wealth creation we can improve the living standards of ordinary working people and invest in public services.
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i will work to bring wealth creation and businesses to the uk economy. still coming up on the show, corporate travel is still flying high according. we'll discuss. that's up in two minutes.
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hello. welcome to the "street signs." i'm carolin roth and these are your headlines. equities fail to see the same pop in asia. we kickoff with the fed and bank of england all meeting this week. and heineken losing its fizz and sinking to the bottom of the stoxx 600. the ceo is looking to the future with the glass half full. >> it is not one or two markets driving the results. it is growth and volume in all four regions. our global footprint is a
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perfect balance with the developed markets in europe and growth markets for the future. philips backs guidance after beating the rise in second quarter ebitda. the ceo says the company can look forward to the further growth after the respiratory settlement. >> we can build on the set sett settlement. we can fully move forward on healthcare and consumers. that showed in the results this quarter. republican presidential nominee donald trump stops short of an official bitcoin currency. he said never sell your bitcoin. >> if crypto is going to define the future, i want to be mined, minted and made in the usa. it is not made anywhere else.
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if bitcoin is going to the moon, as we say, it's going to the moon. taking a look at u.s. futures. we're expecting a positive start to the trading session. the s&p by 16 points. dow jones up 96. it is a heavy earnings week. before that, i want to show you what u.s. markets did last week. we did see the dow jones industrial average eeking out a modest gain of .75%. the s&p and nasdaq down by 0.8% for the s&p and nasdaq in the brunt of the selling off by more than 2%. why? of course this is the whole picture. we saw the likes of alphabet and tesla under performing. let's show you the stocks of w last week.
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rotation out of the mega caps and tech stocks and into the small caps. small comaps up by 3%. tesla off 8% last week and nvidia down 4%. meta off 2.3%. as i said, it is gearing up to be a packed week of corporate earnings in europe and in the u.s. as well. we will hear from several blue chips and four of the magnificent seven. meta and apple. a quick check of the european markets today. a lot of green except for the cac 40 in paris which is down 0.3%. the ftse 100 is up by 0.9%. the dax is eeking out a very minimal gain of 17 points. again, we are in the thick of earning season. we had the numbers out from hei heineken. they disappointed.
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f philips with better margins coming from productivity gains. a super heavy week with the central banks. we get decisions from the boj and boe and fed. ahead of that, 153.81 for the dollar-yen. the story of last week with the fx guest at the top of the hour, was the big unwinding of the carry trade. sterling-dollar down 0.5% at 128.08. companies are prioritizing business travel after covid-19 according to travel perk. the travel management platform found 76% found increasing travel budgets will increase more. let's get to more with the coo of trafficvel perk. great to have you on the show. would you say the travel is back to pre-pandemic levels?
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>> absolutely. that is withis what we are seei the cohort of travelers in 2025. it varies by industry and vary by type of company. i agree, it is about that in 2024. >> it is difficult to quantify how much revenue and profits you get from business travel. what did you find? >> absolutely. we did a very deep survey and asked about 4,000 ceos what value they see in business travel. we can see priorities in two parts. the first part is people who need to travel in order to do their job they have to do. if you are installing a wind turbine or if you are working with mechanics, you actually need to work to deliver the job you have to do. the second part is all the
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meetings whether it customers or employees that will create deeper connections. that is deeply human. there is one thing that covid taught us is the deeply human need for connection. on average, we see $12 return for every $1 of business travel spent. >> with the rise of a.i., you know what question will come next from me. can a.i. replace some of that? you said the person-to-person and face-to-face meetings can be replaced. meaning a.i. can't replace that either? >> we really don't see it. we see it with the case of covid. covid has been almost like a social experiments as far as business travel is concerned because there were specifics for companies to stop business travel for a while and they all rebounded very heavily. the deep reason is because the trust and the creativity that is created by face-to-face interaction cannot be replaced
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by that interaction. anything that is transactional, that tends to disappear. anything that is deep with trust and creativity, nothing replaces the face-to-face meetings. >> what is the impact on a.i. with travel? you say it increases the need for in-person meetings and business travel. why is that? >> because paradoxically, a.i. is extremely good at automating tasks. that's what it is really good at, but a.i. doesn't create trust. a.i. is not going to bring people together so they will work and solve a problem together. as a consequence, what we will see is more and more of the business travel is going to be this deep and genuine creativity business travel that will allow people to leverage a.i.
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it's not going to be opposite a.i., but compliplement to it. >> i wonder if business travel is the first thing to be cut out of companies and organizations budgets as things struggle. do you think we will go back to the cost cutting spree that we've seen over the last couple years? >> i think what we are going to see is we really see companies trying to optimize the best return for the business travel. they tend to do a longer trip or think why the trip should exist in the first place. they use train over flight. we have seen the amount of train between 2019 and 2024 tripled. that is something that's going to happen.
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nonetheless, it is generally a necessity to travel for work to do the work that needs to be done. that is a key component why travel exists. >> to what extent post-pandemic we can separate business travel from leisure travel. does it all sort of melt together? >> it's a very interesting question. it is a complex one to answer. when we ask our travelers, 44% of them said that last year they mixed leisure and business travel at least once a year. on the one hand, it is a large number. on the other hand, when we dig into the details, we realize they don't do that all the time. yes, it is definitely a trend
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and a trend which continues to exist. we zoom out and we look at the actual data and how many trips on business and leisure, it is small because it is not done cys syst systematically. >> bleisure. i haven't heard of that. thank you for joining us. venezuela's president nicolas maduro has won a third term in office after securing 5 an 1% of the vote. this comes despite exit polls suggesting victory for the opposition candidate who garnered 44% of the vote. israel's war cabinet has authorized the government to take retaliatory action after a rocket strike killed at least 12 teenagers and children. the u.s. and israel blame the
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attack on hezbollah, but denies invol involvement. israeli jets hit targets in lebanon on sunday, but after a security cabinet meeting on sunday, a stronger response is expected in fears the incident could spark a wider regional conflict. nbc's meagan fitzgerald has more. >> reporter: dangers of a new war front breaking out after the rocket attack on civilians in the golan heights more than 100 miles from gaza. overnight, israel launches strikes deep within lebanon saying they hit a series of targets. israel's defense minister saying today they will pay a heavy price for their actions. hezbollah denying responsibility for the attack on the crowded soccer field. today, thousands of mourners
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attended the joint funeral for the victims. among the 12 children and teens killed yesterday was 13-year-old john ibrahim. benjamin netanyahu landed in israel today, rushing back from his trip in the u.s. >> we don't want to see the conflict escalator spread. >> reporter: early saturday, the iaf said they launched missiles on a school in gaza killing 36 people and including 15 children according to hospital officials. now the race to reach a cease-fire deal becoming even more dire as the temperature in the region continues to rise. meagan fitzgerald, nbc news. still coming up on the show, kamala harris rakes in hundreds of millions of dollars in donations as donald trump touts the virtues of bitcoin. we're on the campaign trail next.
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lyles will need a good leg here. can he deliver? here comes the pass! look at this kid! coming in tight on the line. team usa, what a run! it's gold for team usa. noah lyles with another gold medal. in case there was any doubt, who was the breakout star of these world championships.
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olympics is under way in paris following the friday evening's opening ceremony along the banks of the river seine. wasn't that tremendous? take a look at that. really breathtaking. wow. on sunday, britain's adam peaty saw the hopes of the third consecutive gold. he took silver in the men's 100-meter breaststroke by 0.02 of a second. this is big. simone biles made a big return to the games in a dia diamond-encrusted leo ttard. the famous names were out in force with tom cruise and ariana grande in the crowd.
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and and difficult andy murray's retire retirement is on hold after his doubles win. and sega sammy enjoys a strong partnership with n nintendo. he spoke to cnbc about the partnership with the movie "sonic the hedgehog." >> in the past, they deal with the licensing and they can't give anything to the product. our partnership has been equal. we have invested in half of the production costs. that's why we will receive the half of the profit of the film project.
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on top of that, that is sega ip with the merchandising rights. that helps sales in the end. it has three or four layers. >> how profitable is the sonic film franchise for syou? >> it is quite profitable. it is quite good. more than 20%. >> sonic was originally developed to compete head on with nintendo's mario. i know you won't admit it, but a lot of gaming watchers say you've not yet surpassed mario's popularity. what are you doing to catch up? >> of course, you know, mario, or nintendo has been a partner for us, too. we are making a video game for nintendo platform. we make a video game together with mario like the olympic games. we are friends as well.
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we are shaking hands on the table and kicking another table. we're still competitors. mario's movie was very successful, but our approach was different. we are making the live-action movie, but on top of the animation as well. in the future, yes, it's seeing the popularity of mario in the world. >> you can catch haruki satomi at the next show on your screen. and let's switch gears. kamala harris raised $200 million in the first week as a 2024 presidential contender. raking in more in a week than biden or trump in june. former president donald trump headlined the biggest bitcoin conference in nashville and vowed the u.s. government
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would keep 100% of bitcoin or a shift from the current separation. it is a radical move as he stopped short of vowing to establish a u.s. bitcoin extra tr strategic reserve currency. >> the u.s. will be the super power of the world in cryptocurrency. if it is the future, i want it to be mined, minted and made in the usa. it will not be made anywhere else. if bitcoin is going to the moon, as we say, it's going to the moon, i want america to be the nation that leads the way. that's what's going to happen. >> he is bullish there on bitcoin. let's take a look at how it is trading. a seven-week high. $69,495.
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i want to tell you the crypto stocks rising pre-market. coinbase up 3.73% pre-market. let's get more on this with the founder and managing partner at token bay. lucy, thank you for your time. xis kamala harris is trying to reset relations with the crowd as trump is trying to garner the crypto vote. who gets the vote from the crypto bros? >> i think it is looking favorable for trump. he's called himself the crypto president. he is putting crypto senators on the podium at the conference. kamala did not make an appearance the conference although she was inviinvited. that did not go down well with the cripypto community. >> no, she did not. can she enforce regulation from
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the s.e.c.? is it possible to turn this around? >> i think it is a bit of an unknown how kamala is going to treat the crypto space. they have a track record that anyone in the crypto atmosphere is horrified by. it is really threatening the life blood of the crypto ecosystem. at the moment, that's what the democratic party stands for. there is a lot of work that needs to be done in a short space of time for the crypto community to feel comfortable that actually the democrats will be pro-innovation and working with the industry to create sensible frameworks. i think it really remains to be seen, but right now, it's not looking too optimistic. i think for now, the 50 million crypto holders in the u.s. are more likely to vote for trump if they are a single issue voter.
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>> we have seen volatility in the crypto prices falling below 54,000. is it all politics driving this? >> it is not just politics. bitcoin has been around for 15 years. there are different narratives associated with bitcoin with no political support or intervention. so, politics just happens to be playing a key part in bitcoin story in 2024 which the crypto ecosystem will welcome. a lot of what drives crypto currencies is the narrative or story associated with it. bitcoin is a value and the equal to digital gold. now it is a key election issue. whatever brings more eyes and attention on to the crypto industry or on to bitcoin is welcome by the industry. >> you know, i wonder, lucy, to what extent bitcoin or crypto will be fully institutionalized
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and a pillar of the institution. we have seen the michigan state making a huge investment in bitcoin etf. do you think the big pension funds of the world will jump into the fray and jump on board? >> yes, that is exactly right. actually, today, the buyers of the etfs which make ethereum easy to access are retail driven and wealth advisors. the big asset allocators are still working through their overall model portfolio. once we start to see that shift, we could really see meaningful upside in jumps in bitcoin price. >> lucy, thank you. founder and managing partner of token bay capital. before we wrap up the show, a quick check of the european equity mashrkets. dax with a gain here. the cac 40 is under water by
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0.4%. the ftse 100 is managing to gain .75%. we had a lot of earnings out today from heineken and philips. they were very mixed. hei heineken, remember, very much a positive story here. sorry. negative. philips up 10%. the u.s. futures with the positive start of the trading session. the dow jones industrial average up 96. the nasdaq continuing the rebound. we look at the futures which are up 69 points. that's it for today's show. i'm carolin roth. "worldwide exchange" is up next. see you tomorrow. bye-bye.
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it is 5:00 a.m. here at cnbc global headquarters. i'm dominic chu in for frank holland. here is your "five@5." investors set for the earnings season and the next market move. up or down. breaking news. israel responds to weekend attacks on its territory from hezbollah in southern lebanon. energy markets are on high alert. never sell your bitcoin so says forme

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