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we are seeing analysts now become more positive. i love the way that happens a lot of times. we're seeing positive comments after honeywell boosted first-quarter outlook from 45 to 49 cents. they had been at 40 to 49 cents. full-year earnings would be at the high end of the previous range. we continue, according to david cody, we continue to see signs of recovery throughout our portfolio and are encouraged by

improving customer order trends in the first quarter, is what he said. then he said for golf he's going to take off two weeks and then quit. that sounded like a good idea. >> there you go. our thanks to david kelly of j.p. morgue funds. >> you're welcome. >> we appreciate you being here. that's it for "squawk box." see you tomorrow. "squawk on the street" is next. live from the financial capital of the world, this is "squawk on the street." good morning, everybody. i'm mark haines. >> and live from pretta in jordan in the heart of the middle east, i'm erin burnett and today we're going to be speaking to some of the biggest money men here in the middle east. we'll also be talking about oil. saudi arabia wants oil to stay up near $80 a barrel. this morning president obama says he's going to be opening up a vast number of waters for offshore drillings, meaning american companies could have

access to that oil. i talked with the saudis general investment officer about this and here's what he said. >> having the price around $80 is healthy for both producers and consumers because it will maintain the cap expend at reasonable levels to ensure supplies and availability of sufficient capacities. >> well, oil today went up as high as $83 a barrel. and by the way, i should let you know, mark, when i asked him about how he felt about oil being at $o80 a barrel, he lookd at me, chuckled and knocked on the wood on the side of his chair. also this morning, we'll take you inside one of the fastest growing and strongest sporting capitals of the world. we were at a big event and we'll tell you all about it, mark. but for now, let's send it back to you. >> are there any camels in jordan? >> mark, of course there are

camels. i wouldn't let you down with that. maybe not as amazing as a tur y turkey, but i got a camel for you. >> all right, thank you, erin. also "front & center" this morning, the adp jobs report shows private employers in the u.s. shed 23,000 jobs in march. expectations had been for an increase in jobs. boeing and goodrich join the parade of companies taking large charges for health care reform. goodrich taking a $10 million charge, $150 million for boeing. futures right now are to the down side. they kind of got rattled a little by the adp report. down 4.90 on the s&ps, a slight discount there because of fair value. still, you're looking at 30, 40 points on the dow at the open. more on all that in a minute, but we start with the exclusive "squawk on the street" daily jobs report. as the adp came in lower than expected. steve liesman, back at hq. stevie. >> yeah, mark, disappointing and

shocking are two of the words being used this morning to describe that weak adp jobs report for march. weak is another word they're using. total private sector employment estimated by adp down 23,000 in the month of march. economists were looking for plus 40,000. so, that's a big difference right there. february also revised down 24,000 from 20,000. the nonfarm payroll estimates for economists, government and private sector, is for plus 200,000. so, that's another reason why this was disappointing. then you break it down by sector and you find goods-producing sector's still shedding jobs. service sector up for two months in a row. now, manufacturing, one of the smaller declines, but still a decline. they break it down by business size. now, small business down, medium down and large down. the only thing you could say good about that is one of the smaller declines for small businesses that we've seen in a while. but it's still not positive, and people feel as if this far into the recession, yeah, jobs lag, but usually not this long. and take a look at adp versus

the government report or the private sector reports for the government report. they track pretty closely together, so it's not as if what we're tracking here is perhaps a big difference or a big change or a big miss by one in a series here. but don't be so quick to write off the government report on friday. the report from the bureau of labor and statistics could still show a huge bump because of all that snow we had in the month of february still affecting the data. adp claims their numbers were not affected. and because adp measures private employment, the census workers, tens of thousands of census workers, don't show up in the adp number. so, there's not getting around this report, but some in the market might not be willing to write off the jobs recovery yet. mark, one analyst just wrote me and said their 124,000 -- this is ward mccarthy at jefferies. his 124,000 forecast, he is not changing it for friday, but he says the risks are now on the weaker side. that's how economists get around not changing it.

mark? >> yeah, right, okay. thanks, steve. >> sure. >> while high worker productivity is normally a good thing, in this case, it could be a key component behind higher unemployment. neil irwin is with "the washington post" and he wrote a front-page article about it this morning. neil, good morning. thanks for being with us. >> thanks, mark. >> yeah, i read this piece, and it kind of -- this isn't the first time we've looked at this issue square in the eye. i mean, the last three economic recoveries we've had have been "jobless" recoveries. i guess it's a trend that's been going on for a while, isn't it? >> yeah. i think three or four in a row make a trend, certainly. what seems to be happening is, you know, what used to happen in a recession is employers kept workers on rather than laid them off and kept them on the payroll, so that decreased productivity. so, what you had was companies saying i don't want to go to the trouble of laying somebody off, but demand is down. i'm going to keep them on anyway. we've had the opposite the last couple recessions and especially

this time around. so, employers really just cut back far more aggressively than you'd expect, given the drop in demand. the question is, does that lay the groundwork for something more positive in the months ahead? if they can't keep up the productivity gains, do we get a bump in jobs as productivity returns to trend? >> even bernanke says it's "extraordinary." >> yeah. this caught the fed by surprise. they don't quite know what to make of it. and you know, the same is true of private economists. you know, you don't expect to see 7%, 8%, 9% productivity gains at a time when companies aren't investing in capital expenditures, building new equipment, that kind of thing. >> so, how do we explain it, software? >> no, i think it's more complicated than that. i think what's happening is companies are, you know, we're in this stage of panic and found all kinds of changes to the work processes. they moved forward a lot of shifting around that might have happened in the years ahead anyway. now, you know, why do they do that? the reasons is workers were in a panic, too. so, workers were so afraid for their jobs, things that would

have been too unpleasant, too dramatic a shift in a normal time, you were able to do last year. now, if that's the case, if i'm right about that, that's a good sign for the job market the next couple years, because that means you just pushed ahead some of your changes that would have happened in the future anyway. >> neil, thanks a lot, appreciate it. >> thanks, mark. >> neil irwin, "the washington post." erin, let's get back to you. all right, mark. well, you were talking a lit about adp with steve and now we're talking about oil drilling off the coast. what does it all mean for stocks? let's get to our market reporters, and we begin with bob pisani. bob. >> and that adp report cost us four points in the s&p futures, but as steve noted here, they're not accounting for the weather there, and that's certainly going to be factored in here. hey, did you see honeywell? we're seeing nice gains here in honeywell, up 2% today. they went out of their way, not only raised guidance, but they noted it was because of topline gains. sales are improving. it's not just cost-cutting anymore. we've heard that from a number of companies. rite aid still tough in the pharmacy market overall. milder flu season and poor

pharmacy margins. that's hurting them. it's been hurting all of these pharmacy companies. that stock's down about 8% as they had earnings out below expectations. end of the quarter's approaching. good news, up 5.2% in the s&p, four straight quarterly gains. we'll talk more about the winners and losers next half hour. tradertalk.cnbc.com. and a big ipo on the nasdaq today. >> we do. i'll talk about that in a second. first i want to talk about research in motion. yesterday it was down on that news about reports, at least, that apple is looking at a cdma phone. research in motion will be reporting after the bell. we're looking for $1.28 on the bottom line and $4.3 billion in revenues. it is also started at outperform at exane bnp paribas. exxon giving back. ericsson signing yet another deal in asia, this time in india, worth $1.3 billion. that's on the back of about $2 billion on deals in china. and meru is the big ipo this morning. this company helps companies cut the cord and go completely

wireless on their networks. they priced at the top of their range, $15. 14.4 million shares, will raise 6.6 million. and they're ringing the opening bell. you can hear them cheer. over to you at the nymex, brian. >> listen, what they were talking about in cancun, mexico yesterday, what erin burnett's talking about today, and of course, the obama news and drilling, but traders right now dealing with what's right in front of their faces. there's a lot more energy today and for a couple of reasons in crude. first reason is weaker dollar, stronger our. the american petroleum institute came out with numbers yesterday. a smaller build than expected in crude. we had the eia numbers coming out at 10:30 a.m. eastern time. it could be a range-breaker because we're headed towards $84 now. and i also want to point out, the rest of the complex is up. nat gas is trending up and gold up more than $12. mark, back to you. >> thank you very much, sir. let's check out asia, see what happened there overnight. well, down across the board.

and except for the nikkei, which was down just a hair, the losses probably averaged about 0.5% or a little more. what's going on in europe, you might think? uh-oh, down across the board there, too. paris taking the biggest beating. germany and london down about 0.3%. and our futures are pointing to a lower open. so, let's get the "word on the street." joining us live from the floor, terry dolan, ceo of benjamin & carol brokerage. good morning. >> good morning, mark, good morning. >> time to worry or time to load up, time to load up on weakness? >> every dip is an opportunity to buy, but we are coming to the upper end of the trading range and i think we'll run into some trouble, some static up around 11,000. you know, the moving averages have stayed positive on the one-year. they're kind of neutral. on the two-year chart, they've stayed positive. so, really, the trend is intact. i think we've seen this morning is probably a little response to the bond market yesterday and

the day before. and i think if we're smart, we'll be cautious about watching the bond yields moving up and see if this rally doesn't fizzle out as a result of higher yields in the bond market, which could have more implications for, you know, commercial credit markets and other markets that you don't really talk a lot about, but we know are still struggling somewhat. >> a couple weeks from now, we're going to be in the thick of earnings reporting season. there's been some speculation yesterday in the "journal," there was an article that good earnings are already baked in the cake and the most likely outcome is disappointment. what do you think about that? >> well, you know, mark, i've thought that and heard that and seen that before. the only trouble is that we haven't seen the disappointment that the market keeps looking for. earnings season after earnings season, we talked about increases in earnings relative to cutting expenses and productivity increases. you know, i think we're seeing better guidance and i think we're seeing better results from a longer-term standpoint. however, you know, with the

market rallying the way it has, its march up to 11,000, it apparently is continuing onward, it would be prudent to take some money off the table and take a look and see how the earnings respond, if you get a negative reaction, you could come back in with the cash that you sold your stocks with. >> all right, terry, thanks a lot. >> my pleasure. >> terry dolan, benjamin & jerold. the end of the quarter is upon us, the s&p on track for its best first quarter since 1998. the dow could see its best first quarter since 1999. where do you think the dow will end this year? that's our street poll. squa squawkonthestreet.com. you have three choices -- 10,000, 11,000 and 12,000, which kind of brackets where we are right now at 10,900. now, back to erin in petra, jordan. >> mm-mmm, i'm just thinking, you know, just because i'm a long-only kind of person, i just

hope it goes all the way up, get back to 14,000, mark. all right, we've got faber on ford, which has been a big part of the rally for the overall market. and we've got beyond the big board today with an investor who just came back from this part of the world. he'll give his sense of how things are doing and maybe his forecast for the dow, two minutes away. we'll be right back. natural gas is a cleaner burning fuel, yet a lot of natural gas has impurities like co2 in it. controlled freeze zone is a new technology... being developed by exxonmobil... to remove the co2 from the natural gas...

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welcome back. i'm david faber. what day is this? wednesday. you know, interesting deal this morning, although the market was aware of this yesterday. a warrant deal by the uaw related to ford. it's been pressuring ford shares over the last couple of days. if you were weren't aware of this, the uaw going out through deutsche bank and selling warrants to buy the stock or warrants at $5 a share that will give the owner of that warrant the right to buy the stock at $9.20 in three years for ford. but what has been happening is, is deutsche bank was in the market yesterday with this deal getting it done. you had convertibles out there shorting the stock. why? because you know, you want to lock it in and then the deal gets done and you're able to do that. if it was a common stock offering, it would be different, but because it's a warrant, you can do that. and that's been pressuring the shares. this morning, allocations get done and you get a bunch of

hedge funds coming in saying, hey, you know what, let's buy the stock itself. but there it is. it's raising a good amount of money for the uaw, about $1.78 billion for them, and this warrant will be listed. but again, that is where the selling pressure has come from. take a look at ford, because the stock was, what, $14.50 not long ago? you can see it right there, and going down to below $13 a share. we'll see if there's a rebound at all today in ford shares. i believe it's tomorrow that the company reports sales. of course, many expect that those numbers will be quite strong. nonetheless, this warrant deal. interesting to note, of course, we saw the warrants deal -- we talked about warrants yesterday related to comerica, but that's a different story. these will actually list, an offering done by deutsche bank. didn't involve ford at all. based on uaw shares or warrants, again, being sold at $5 apiece,

giving the owner of those the right to buy the stock at $9.20 in three years. that selling pressure may abate. ford shares may look a bit higher. we'll see. mark, back to you. >> thank you, david. we're counting you down to the open, now just 11, 12 minutes away. throughout the morning, i guess, we're looking at what kind of number we're likely to see in friday's jobs report. erin. >> that's right. and then we're going to have the buzz from beyond from someone who just got back from abu dhabi with his trades. plus, more on the president's plan to drill, drill, drill, from here in the middle east. got more oil than anyone. we'll be right back. 1-800-345-0 that's why, at schwab, tdd# 1-800-345-2550 every online equity trade is now $8.95 tdd# 1-800-345-2550 no matter your account balance, how often you trade tdd# 1-800-345-2550 or how many shares... tdd# 1-800-345-2550 you pay what they pay what everyone pays: $8.95. tdd# 1-800-345-2550 and you still get all the help tdd# 1-800-345-2550 t you expect from schwab

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all right. as we count you down to the opening bell, here's a check on the futures, where they stand right now. we've slipped a little bit. we're down 5.10 now. looking at 30, 35 points on the dow lower at the open. the minis right now down exactly five points. back out to erin in jordan. even when you say e-minis, i think of donuts. all right, mark, let's bring in john o'donoghue. he just got back from this part of the world and abu dhabi, visiting a lot of his clients. let's talk about it, john. good to see you and perfect timing. what was your impression? >> first time there, erin, so i was in awe, i guess, is probably the easiest thing. but in talking to a lot of these folks out there, they have an eye towards the east from where they are geographically, an eye towards the west. and i think the way i would say the eye towards the west is, the changing dynamic in government, if you will, you know, and obviously, there's an election coming up in the uk, which could

end up in a hung parliament. they're somewhat concerned, obviously, about the euro. in the u.s., i think there's a feeling that there's stability. it's just a matter of whether, in fact, there can be growth or not. but then, you know, further to the east, obviously, with the large uae population from both india and pakistan, there's obviously a view there that there's lots of growth still to come. >> yeah, absolutely. i have similar impressions to you. john, i was talking to some of the senior leadership there in abu dhabi, and they were telling me they're going to be a whole lot more active this year in deals than last. i had this conversation just the other day, and i would assume our viewers would want to know. they say they're going to be much more active in buying things in the united states. obviously, abu dhabi is 10% of the world's oil. do you think that a lot of people were too quick to write that part of the world off? >> well, i think there was probably a misunderstanding as to that part of the world and the tremendous wealth that's there. i think, you know, everybody understood that dubai was, you know -- i don't want to put this

in a denigrating form, but could have been the las vegas of the middle east, so to speak. but abu dhabi, if you think about it, is a very, very conservative place with an enormous amount of wealth. they're very shrewd individuals. they have a lot of people around them who are very bright. and from their standpoints on views in the u.s., they feel like their situation has stabilized. i do think they're looking at the current political environment as to how things have changed post health care and the midterm elections as well. >> yeah, i got the impression -- i also spoke to the prince in saudi arabia and he was bringing up all the debt issues. everybody seems worried about that. john, what is your view on our poll of the day? i'd be remiss if i didn't ask. dow 10,000, 11,000 or 12,000 by the end of the year. >> i'd say 11,000. >> all right, thank you very much, john. we appreciate it. and mark. >> all right. >> 11,000? we're at 10,900 now. all right, final countdown to

the opening bell just on the other side of the break. plus, we'll have a fresh crop report and what it means for commodities at large. a new read on chicago pmi and the smartphone wars rage on. winners and losers in that, coming up.

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all right, you're watching cnbc's "squawk on the street" live from the financial capital of the world. the opening bell is set to ring in 2 minutes, 45 seconds. in the headlines at this hour -- the adp jobs report a bit of a surprise, came in lower than expected, showing a loss of 23,000 private jobs in march. important point -- adp measures only private jobs, not government hiring. goodrich and boeing both taking health care-related charges, $10 million for goodrich, $150 million for boeing. president obama will release a plan today to allow energy companies to increase drilling for oil and natural gas off the east coast of the united states.

erin? >> yeah, mark, that's a headline getting a lot of attention over here, although i can tell you, so far, people aren't very afraid about it hurting oil prices. michael gurka joining us right now from the cme just to get us ready for the bells. you heard mark talking about the adp report. did it worry you at all? >> you can't turn an eye on that, because obviously, weather doesn't come into play, government jobs, and you may be getting an inkling that the market is too euphoric in its economic forecast, but pertinent to where you're at right now, erin, one of the things i wanted to mention is this weekly global demand for emerging market debt. and in particular, you're seeing countries, such as indonesia, mexico, poland, and now russia, where we're seeing yields coming down dramatically and the spread between developing and developed markets are narrowing on a daily basis, and that's actually showing us that the globe is really paying attention to who ran into credit problems two years ago, who didn't, and the reasons why.

if your debt or fiscal problems are not as enormous in borrowing as much as the u.s. is, there is a lot more appetite for investors to go in that part of the world. so, right now at least, we have to look at counterbalance of how the stock market is looking bearish and how the dollar all of a sudden looks weak. i think it's all a head fake. >> all right. well, michael gurka, thank you very much. we appreciate it. mark, it's interesting, when you have seen a rally in emerging market stocks and interesting his point that you're still seeing the bond market gap narrow. some people are worried about emerging markets. you look here, some of the best performers in the world so far are coming from this part of the world. i guess it's because they have that natural resource. it gives them sort of a bit of a base. >> all right, thank you, erin. here come the opening bells for you on a wednesday morning. here at the big board, the port of barcelona in advance of the new york-to-barcelona

transoceanic sailing record quest. and at the nasdaq, meru networks, ticker meru, maker of wireless networking equipment, celebrating its ipo today. all right, our market reporters are standing by all over the place. let's start with bob pisani here on the floor. bob? >> so, we lost about four points on the futures when that adp report came out, disappointing. we never really got them back. we've been down ever since those numbers came out about 8:15, 8:20 eastern time. by the way, this crowd here is for the ford warrants that are coming out this morning. so, we've got some -- i think they just came out just a moment ago. i'll get you numbers on that in a few minutes. the important thing on honeywell today is, like many companies, they raised guidance not because of cost-cutting, although that was partly it, but because sales are improving overall. remember, honeywell's in a lot of different businesses -- aerospace, automation control

businesses, transportation, speciality materials. it's a wide swath of businesses. again, a good sign overall here. rite aid and all the pharmacy companies have had a tough time recently because margins have been a lot thinner. it's been a much lighter flu season, and yeah, they make a lot of money on flu season. so their earnings were below expectations. the loss was greater than expected. we had the end of the quarter approaching. s&p's up 5.2%, four straight quarterly gains. the big movers have been the global industrial names on the recovery, the big bank names on expectations of a turn-around in bank profits and retail stocks. and of course, the retailers have done great in february. we'll see about march. tradertalk.cnbc.com. bertha, how are we looking at the nasdaq? >> we're starting kind of flat here, a little bit to the down side. in fact, research in motion at the moment, having given up some of the premarket gains, will be reporting earnings after the close. this morning also exane bnp paribas starts it at outperform. also starts apple at outperform as well with a $300 price

target. apple topped out yesterday at $2.37.48 a share. meanwhile, cisco, you've seen a lot of ads with ellen page. they're targeting the network ing sector, off 0.5%. meru, they're the very excited folks, almost like ipos of old. i remember them ten years ago. they're very excited today. they will be starting at the top of the range, pricing at $15 a share. this is coming in for networking for enterprise. meantime, a couple biotechs soaring this morning. they're very small. meantime, better-than-expected news for the drug treatment. let's head down to brian shactman at the nymex. >> oil is softening a bit after the adp number came out, but as santelli would say, the dollar got whacked on that data, and so, we bounce back up because we're reacting to the dollar quite a bit today. i've talked to a slew of traders about this white house move about announcing drilling.

they basically say this, on the trading floor, it's a big deal, but it's a long way off, so it's not impacting today's trade at all. what is impacting today's trade beyond the dollar, the api numbers came out late yesterday, a smaller building crew that be expected. i'm told if we get a bullish number of eia in an hour, we could break $84. brent is still trading down by about a dollar. and now to gold, back to the correlation on the dollar, especially related to the euro again, we're up about $13. mark, back to you. >> thank you very much. quick check on the markets for you. the dow, as expected, down about 34 points right now. and now call it 32.5. s&p down about 4, nasdaq down about 6.5. losses of 0.25% to 0.33%. your "cnbc edge" now with bill sporopolis and dennis mossen,

cabinet management portfolio manager. bill -- >> good morning, mark. >> i'll start with you. we've broken through the top of the ranks, but with not much enthusiasm. where is this market headed? what is it telling you? >> well, we continue to climb the wall of worry. nobody believes this thing. and you hear all the negative, nasty tales about how the world's going to end next month and they're wrong. and this thing's going to continue to do what it's doing, slow, slow move-up. 11,000, 12,000 in the cards this year, but you know, that's really not the issue. the issue has to be on managing risk and new strategies. because i do think that we're in a long-term secular bear market. >> oh, okay. there was the hook right at the end. dennis, what about you? why are we not seeing much enthusiasm in this market after popping through the old highs? >> well, i think, you know, i kind of agree with the notion

that the market continues to climb that proverbial wall of worry me, but the important thing is the macroeconomic data points continue to improve. we're early on in that macroeconomic recovery and i think you have a lot of ammo yet to be placed in the equity markets. you still have the capital flows into fixed income funds much more so than in equity markets. there's still $3 trillion in money market funds out there. and as that market -- as that capital comes back into the equity markets over time, i think that will help provide the fuel that can move this market higher. >> bill, mark and i both got caught when you said it was a secular bear market. what does that mean? how long does it last? when do you think we go back to that 14,000 high for the dow? >> listen, you know, between 1966 and 1982, the market had four moves where it went up or down anywhere from 30% to 50%. in 1968, it was a horrible year, but we still put a man on the moon. when i say secular bear market, we're talking about a sideways trend. you could see theoretically the

top end 13,000 and the bottom end 9,000 and trade back and forth until we address the fundamental problems that we have in this country on deficits, long-term debt, fannie, freddie. there's a list of things that must be resolved. they're not going to go away. and once we return to normalcy, which we are doing, the core rate of inflation's going to go up, and you see these negative returns in the bond market are going to eat people alive, but it's not going to be the end of the world. and the bear market could last anywhere from five to six years. >> mark, go ahead. >> no, didn't mean to interrupt, sorry. >> all right. well, dennis, let me follow up with you, then. do you think that he has a point there? and particularly on this inflation point, because this is almost like a war zone right now. some people think it's going to come back for sure, and others say no way, you are crazy. the capacity utilization in the united states is so low, inflation is not going to be a problem ever. >> no, i think these things are going to be issues to deal with over time, but i still think

that when you have the improvement that we're seeing macroeconomically and all these other data points, these are going to help the market improve. and even though we could have rising interest rate environment, inflation could become a challenge, you still have the growth factor coming back into the market and these could help the market move higher. specifically when we look at how to attack the market at this point, we're looking for themes in markets and sectors that are driving growth and opportunity here. you know, one i would point to is in the energy space, where you've got, i think, more of a contrarian viewpoint on the natural gas related stocks. just came back from a howard weill energy conference last week, hearing the industry leaders talking about these dynamics and you have an interesting entry point, natural gas related stocks when you're looking at a $4 price. i point to southwestern energy and that sector, specifically, who's an exploration production company focused entirely on gas, for example, as a way to play that levered recovery at some point. >> all right, gentlemen, thank you so much, appreciate it. >> thank you. >> take care.

next, peak commodities are -- whoever wrote the skrimt th script this morning, english is not their first language. >> maybe it's arabic, mark. >> i'm guessing peak commodities are buying for acreage? details on the record-breaking profit report, coming up. >> mark, maybe they wrote it in arabic. we're going to be talking about dubai. it's still struggling, but is it a debt threat or opportunity? and the man who owns atlantis in dubai, an american billionaire and head of the biggest construction company in the middle east, also a billionaire, are here in petra for a special edition of "street signs." and as i turn here to look over at our friend, this is just for you, mark. who says camels aren't smart? >> oh, yeah. oh, look at that! look at that! >> mark, look -- >> how about that? >> he drained it right down! >> wait a minute. make sure you put that in the recycling bin, camel.

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did you know this? i mean, erin goes to the middle east and oil goes higher. hmm. i wonder. anyway, time for "commodities corner" on the record-breaking profit report out this morning. we go now to farmer jane. we know she's a farmer because she's outstanding in her field. what's up, jane? >> reporter: oh, mark, you're so funny. i'm at the underwood family farm. this is barley behind me. actually, barley stocks are up 22% from a year ago. some analysts considering this morning's reports from the usda as bearish. less corn and soy than expected and more wheat, which is surprising, considering how much wheat is still in the system. if you look at the numbers, prospective corn plantings are

88.8 million acres, second largest since 1946, 3% more than a year ago but shy of 2007's mammoth 93 million acres. it's a little more than expected, maybe as the current corn supply is highest since 1987. soybeans expected to set a record, but not as big as analysts predicted and projections at just over 78 million acres, shy of 78.5 million. and the usda products 53.8 million acres of wheat, more than a million more than expected. and spring wheat plantings are projected high yes, but still overall, wheat down 9% from a year ago as wheat hasn't been selling well compared to global rivals. >> wheat is terrible. there's no other way to describe it. as demand-driven as the soybeans are, corn is right behind it, wheat is not a demand-driven type market. rather than 48% or 49% of the total wheat produced in the united states leaving in the form of exports, we're down to

37%. that tells us right now that we're not getting the job done when it comes to exports. >> reporter: all right, you can see these charts. wheat rallied off its lowest price in months yesterday. a lot of that was short covering. we'll see what happens today. wheat supplies or stocks are up 30% from a year ago, though a little less than expected. soybeans, let's look at that. meantime, those stocks are down 2% from a year ago, though not as low as expected. 1.27 billion bushels. you know, it is expected that farmers might want to plant more beans than corn this year. that was the conventional wisdom going into today, but maybe not. some believe the financials look better for corn if you look at corn over the last week now. but of course, all this could change depending upon the weather. basically, a mild april usually means more corn. a tough april or may usually means more beans. joseph victor thinks the usda will move these numbers up when the next report comes out in june. by the way, erin, cotton making a comeback. projected acreage is up 15% compared to a year ago. back to you in one of the places

of the world that i want to see before i leave this veil of tears, petra and those red rocks. [ inaudible ] >> yeah, is it me or is it everybody? okay. it's not just me. you never know. sometimes when i don't hear something, it's just my equipment, not everybody else's. but obviously, we have a problem with erin's mike, so we will take a commercial break and then we will re-establish contact with erin in petra. i've been growing algae for 35 years.

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welcome back to "squawk on the street." we had the chicago pmi out and it wasn't pretty at 58.8. it was a disappointment. if you dig through the subcomponents, though, you'll find there was one small silver lining. we saw an uptick in the employment index. now, as you look at the charts, whether the ten-year or the dollar index, you won't see a big move. why? because the adp was so disappointing to many, it took out the zing on this move because this move should have rallied treasuries or should have potentially broken the dollar index, but all of that already occurred at 8:15

eastern. now numbers going to go back to jordan and erin burnett. >> thank you very much, rick santelli. and from here, we're going to go to dubai, where we were gisting just a couple days ago, joined by matthew wakeman. he is at the dubai financial market floor. i do want to note, that market closed just hours ago, so if there aren't people behind you, that's why. let me ask you, i was at that horse race, just to get a sense of whether there was still energy or excitement there. what is your view right now from the inside on the dubai trade? >> i think to be honest, the sentiment's increased quite a lot in the last couple months. the market pricing in a very gloomy scenario in january-february, and i think there's been a massive shift in march. we've seen people come back to the markets, you know, people on the streets seem a lot more bullish as well, and you know, they've still got net inflows of ex-patriots moving to the country. so, on the ground, everything seems a lot better than say this

time last year. and you know, the markets are starting to price in a rosier scenario going forward as well. so, you know, i think in terms of how the markets feel and how dubai feels as a place, you know, i think it's looking pretty good at the moment, and you know, hopefully, we can build on it and move forward. >> we're going to show you pictures now of a building that is no doubt familiar to many of our viewers by now. that used to be dubai. it got renamed khalifa because abu dhabi obviously has solidified its political power over dubai. but you're saying one of the best plays in the region is amar, and that's the company that built that tallest building. a lot of people want to say people aren't in that building as tenants. it doesn't sound like you're worried. >> well, i mean, it's pretty well diversified across the country. you know, they've got fingers in little pies, other than just direct real estate. they've broadened that model to countries across the area and asia as well.

so, they've got a strong balance sheet, emaar is moving into other sectors just to shield itself from, you know, the direct real estate trade. so you know, it's one of the stronger companies in the region going forward in terms of valuation at the moment. you know, and i mean, at the moment, i think if you want to invest in the market, you don't need to look too far, other than the large caps, because they are for the best upside potential here. >> and the other country we were visiting for the last couple days, saudi arabia, in riyadh. and that sounds like your other best idea, and a company any ge shareholder knows because they bought one of ge's plastics. >> yeah, correct. it is one of the largest listed petra chem companies in the world. it's well diversified globally. it's a good play on the global recovery as well as domestically in saudi arabia. you know, pricewise at the moment, you know, it's had a decent run in the last week or so, but you know, they're due to

report next week, and you know, the hope is that they'll come in better than expected and we could see upward revisions, but they're well placed to move forward. at the moment, the stocks in saudi arabia are trading at more of a discount than they traditionally would to the other countries. >> all right, matthew, thank you very much. interesting they're trading at a discount considering, for those of you out there, saudi arabian stocks are up about 10% this year. that's good for the best performance in the middle east. we appreciate your time, matt. and let's get to nesto the magnificent. thank you, my little traveling passported friend. let's take a look at the oil drillers here today, just to show you the numbers. osx is very strong. 10 of 14 members trading higher. if you look at the supercomposite, oil drillers index, i show all ten members pushing higher. transocean, ensco, noble, diamond offshore, just to name a few. and the worst stock in the s&p 500 this morning is saic. disappointing results, lower than consensus forecast, met by a downgrade at wells fargo this morning.

they cut it to market perform from outperform. they think that the stock is headed lower. back to you guys. >> all right, thank you, matt nesto. research in motion releases its fourth quarter earnings after the bell today with reports that apple is preparing to launch an iphone with verizon. where does r.i.m. stand in the increasingly competitive smartphone space? joining us now, mark mckechnie, telecom analyst at broadpoint amtech and robert -- i'm going to take a guess -- cera? tech card analyst at caris. i think i'm right about that one. and company. since i butchered your name, i'll start with you. how is r.i.m. doing in the smartphone war? >> quite well, even with all the competition. i think they're really holding their own. i expect a good report tonight. and i think they're kind of carving out a niche in a sea of kind of iphone wannabes.

i think r.i.m.'s doing well in corporate, but even in consumer, they're kind of lower cost, more of a mainstream phone. i think they're really holding their own. >> and mark, do you have the same view? >> yeah, i tend to agree. i think the big debate on r.i.m. is, you know, balancing the growth in smartphones, you know, 30%, 40% type growth targets against the competitive situation. and i do think r.i.m.'s doing well with their positioning in the enterprise. they're growing internationally and 14 times fiscal '11, i think the stocks focus too much on the competition. >> staying with mark, how do you view this news and its impact on this market, this news that apple may have an iphone for cdma systems like verizon in the near future? >> thanks, mark. yeah, you know, not really news. this has been talked about for a while. i guess the "journal" talked about it coming to verizon at some point.

we think it's an early 2011 event. you know, it is going to provide a headwind to r.i.m. it's certainly positive to apple. but we do think that r.i.m.'s competitive position as well as growth internationally, and you know, people don't talk about the competitive response from at&t, you know, who hasn't really been pushing blackberry tremendously hard, who, when they lose their exclusivity on the iphone, i imagine they might step up the promotions there. >> robert, same question to you, how does this impending iphone for cdma systems impact the marketplace? >> yeah, well, i mean, i agree it's a when, not if, that iphone makes it to verizon, whether it's late this year or next year. and you know, there is going to be more competition. i'm sure r.i.m. would love no competition, but that's just not the case. but what i do think people may be focused too much on is iphone versus blackberry versus android and missing the big picture, which is you add up all those

three platforms, they're less than 10% of the whole cell phone market. there's a whole lot of market to go around, i think. >> isn't -- i'm speaking strictly for myself now, but it seems to me i can extend my experience -- isn't some of the resistance to these smartphones the fact that the data charges are rather high? >> it is true -- >> well -- >> okay, and isn't that going to keep the smartphones with a relatively small market share? >> yeah, let me jump in, if you don't mind. >> sorry. >> yeah, no, i think that's a great point, mark. we were at the ctia show. at&t was talking about a 40-fold increase in data traffic over the next five years. i mean, it's definitely something the industry needs to address. and you know, one of the ways they can address it is, you know, by effective applications, and r.i.m. does a good job of actually more efficiently getting data to the end users. they don't hog up the network. >> okay, gentlemen, got to go.

thank you very much, mark mckechnie and robert cihra. breaking economic data coming up after the break. e erin? and oil inventories. we'll have the man in saudi arabia weighing in on that. two top investors join us here in jordan to talk about how to play the youngest region in the world. we'll be back.

welcome back to "squawk on the street." we have february factory orders in hot off the presses. it's up 0.6%. and indeed, that isn't necessarily what people would want to see. they would want to see maybe up a lot more because we all know inventories are a big contributor into gdp. but no matter how you slice it, factory orders in the trajectory of what moved the market today is probably last in a line that started with adp and then was also affected to some extent by the chicago purchasing managers survey. but of course, we're all going to stay glued for the last day of quantitative easing. will the world change tomorrow and will it change even more on friday when we get the jobs report? now, let's go back to bob pisani.

mark, i'm sorry. >> or me. >> i'm sorry, mark. >> that's okay, rick. i realize you're in engelwood cliffs this morning, aren't you? >> yeah, so i'm automatically discombobula discombobulated. >> so the whole aura thing is out of what can. we get it. we start with bob pisani at the big board. >> we've been weak throughout the morning because of that adp report. the important thing is, the leaders for the month showing -- the leaders for the quarter showing a little weakness here. one thing i want to point out, health care stocks have done well going into the last week or so, and the last four or five days they've sort of been drifting lower. these include all the big hmo names. they're not participating in the small gains we've been seeing in the market. let's talk about the bank stocks. big winners, double-digit gains on the quarter. citigroup, though, has been down almost every single day since the government announced they were going to be selling 7.7 billion shares. and the regional banks have been weak as well. these have been big gainers. they're on the down side. finally, i want to note the other big gainer in the group

for the quarter has been retail stocks. they, too, have been showing signs of a little profit-taking in the last three or four days. tradertalk.cnbc.com. bertha, how are we looking at the nasdaq? >> we're seeing a bit of a pullback here. whatever window dressing folks are doing is not buying up some of these stocks that have been winners, at least during the quarter so far. wireless continues to be a focus. research in motion up about 7 cents. will be reporting earnings after the close, but this morning, exane bnp paribas starts them at a $90 price target for r.i.m., for apple, it sets a $300 price target. apple eve with the pullback today continues to have a market target bigger than walmart. ericsson is up, signing another deal in asia, worth over $1 billion in india. jdsu at a new high in networking. those are the standouts. and meru networks set to debut in about a half hour or so. prices at the top of the range. brian, over to you at nymex.

>> thank you, sharon. in 27 minutes we get the eia inventory numbers. let's look at what's expected, according to platts. a better than 2.65 million barrel build in crude. we are expecting a big drawdown in gas and distillates. a large drawdown in crude or a smaller than expected build would mean a challenge at $84 a barrel. we're at $83.50, up about $1.12. it's a situation where the api showed a smaller build than expected. so, it definitely might happen. the rest of the complex, a little bit mixed. nat gas is just a head-scratcher. up, then down. see how $4 is affected. see where the fundamentals are related to price because fundamentals are bearish. erin, so much talk about the president obama drilling plan and the announcement. it's a bit of an about-face, but most traders say they look at what's right in front of their face and it could be years before we see the benefits in terms of what comes to market. >> brian, you said it better than i could. that's certainly the attitude here. i was just in saudi arabia

yesterday, and that was definitely the feeling there. no concern about oil prices. they think they're going to stay around $80. by the way, they think that's absolutely fine and not going to be too hard for america to take. this region has 60% of the world's oil reserves. 10% in abu dhabi alone. so, they're definitely not concerned about that, at least not yet. well, why are we sitting here? we're sitting in petra, because it used to be the world's financial capital, years ago before there was a dubai as the center of the middle east, there was petra, the global financial capital. now the middle east is on the rise again. 65% of the people in this region are under age 30, more than anywhere else in the world. it is the best youth demographic that exists. we're going to be talking to the head of yahoo! in a couple of moments about why they think that's such an opportunity. and of course, you've got trillions of dollars of sovereign wealth funds, some of the reasons why we are sitting here today. and later on, we'll be talking to two billionaires who have traveled here to petra, jordan, which is really not easy to get to, to talk about their view on the region right now. we've got the richest man in egypt and all of africa, the

head of a construction company that just did a big fertilizer deal yesterday, the biggest construction firm in the middle east, and tom barrack, ceo of colony capital, owns hotels across the region like the walmart for the rest of the world. we'll be focusing on that, mark. we're excited about our guests. a lot of them are coming early because they actually want to go on a little bit of a tour because this place is really that spectacular. >> i didn't hear that last bit, erin. someone else was talking. what did you say? >> i just was saying, mark, a lot of our guests have shown up early, and by early, i mean five, six, seven hours early because they're so excited to see this place. it really is -- i know it's a wonder of the world technically, but -- >> i think a lot of our viewers would like to know what that is, briefly. >> a wonder of the world? >> no, what the thing is behind you. >> oh, the thing behind me. okay, the thing behind me is

actually -- these are tombs. they said that they were royal tombs, at least that's what legend has. and we're sort of near the front part of petra. there's a road right behind us. it's called the obalise tomb. and in 20 minutes you'll be standing in front of the treasury, which was the financial capital of the world 1,700 years ago when camels carried spices through these streets. and it is a spectacular building. >> all right. thank you very much, erin. talk to you later. another billion-dollar pharma/biotech hook-up. isis pharma and glaxosmithkline are the two companies involved. you know what this means. that's right, mike huckman on the case back at hq with one of the players in another "cnbc exclusive." michael. >> good morning, mark. isis shares, by the way, up 8% right now. the mp&a trend continues in biopharma this morning. mergers, partnerships and acquisitions. this latest one potentially worth more than $1.5 billion

over time to isis pharmaceuticals. joining me live from san diego in another cnbc exclusive is isis chairman, founder and ceo, dr. stanley crook. good morning, dr. crook. thank you for being here. >> good morning, mike. >> this announcement with glaxo has a lot of moving parts and triggers in it, perhaps unlike any i have seen to date. so, what does that say about the trend that seems to be building about the need to get increasingly creative if you want to do business with big pharma these days? >> well, from our perspective, the way to think of this deal is that gsk has acquired an option to five potential drugs that they have the right to license on predefined terms at the completion of phase two proof of concept. so, from our perspective, it's exactly in line with the type of deal we want to do right now. it leaves us in control of the research programs and the early

development. it provides cash now and a very attractive licensing terms for us at phase two and lots of other opportunities to generate revenue along the way. from the gsk perspective, of course, they get access to our technology and the productivity and they have an opportunity to work on these targets, several of which they brought to us, with the only technology that can really approach them. >> and i don't want to get too deep into the scientific weeds here, but you have a unique technology in which your experimental drugs, you believe, are going to work by interfering with the genetic makeup of disease. but there are many skeptics still out there. what gives you continued confidence in this technological platform? >> the data. we have data from nipamercin that -- >> that's your drug for high cholesterol. >> and i have two

extraordinarily positive phase two trials that we've reported. we have positive data with multiple other drugs in the clinic, both drugs that we're developing and being developed by our partners. and we have a ton of interest from major pharmaceutical companies who are sophisticated enough to understand fully that this technology now works very well. >> dr. crooke, we have to go. you went to butler. are they going to go all the way or are they going to have their hands full with michigan state this saturday? >> no, they're going to win by 18 points. >> all right. thanks again, dr. stanley crooke, isis pharma chairman and ceo. for more, check out farmersmarket.cnbc.com. follow me on twitter at mhuckman. mark, back to you. >> wonderful, getting a totally objective opinion on that. i'm picking west virginia, by the way. i think west virginia is going to take this. it is the final day of the quarter for s&p and dow with signals to the best end to the quarter in ten years. for the economy it means the end

of the fed's mortgage-buying program. so, given all that, how should you set yourself up coming into the second quarter? john riley, chief economist with rdq economics joins us as well as scott rant, senior equity strategist with wells fargo advisers. scott, i will start with you. what do you expect to do best in the second quarter? >> i'll tell you, mark, what we've been trying to get our clients to do really for the last year is to position themselves for a continuation of this cyclical recovery that we see. so, we've been recommending overweight industrial positions, overweight materials. we certainly want them to be underweight defensive things like health care, staples, utilities. so, the types of companies that we've been talking to our clients about for quite a while and the types of companies that we've been adding to portfolios and things like that, things like fedex, alcoa, steel companies like us steel, itw,

things like that. so, that's what's been working for the last year, and we think that's going to continue to work as we come through this year and into 2011. >> john, how about you, how are you looking at the second quarter? >> well, i would agree with those broad themes. it looks to me like the recovery is broadening out. i think we're on the brink of starting to create some jobs which will help support the consumer. and we're seeing very good recoveries overseas, especially in asia. so, i think it is one of improving recovery momentum where we transition away from restocking to more end growth in final demand. and i think that's very good for the equity market and will support those kind of sectors that were just mentioned. on the other side, though, i don't think it's going to be such a good quarter for bonds and i'm looking at potentially a significant backup in bond yields in the second quarter on these recovery issues and also on further concerns about the fiscal outlook for the u.s. >> scott, is the snail's pace of

this advance telling us anything? is there anything about this that signals anything? >> well, you know, mark, really, this has been a very low-volume rally, and we're just grinding higher. >> right. >> and it just -- i think this type of pace is going to continue. so, you know, really, i think a lot of people, a lot of retail investors, and specifically, have missed most of this rally and have not been jumping into the market here. so, i think this is the type of market where people are now starting to look for a pullback, which in my mind says, hey, we're going to go a little bit further before we see that. i think this year's going to be much more volatile. we're not going to see the big progress in the market that we saw in '09. but it wouldn't surprise me if we had multiple 10% pullback, something like that. we're expecting more volatility. but right now, everybody's looking for the pullback, so i think the chance of it happening

quickly or right away is a little slim. >> all right, gents, thank you very much. john ryding, scott wren, thanks very much. where do you think the dow will end the year? i'm talking to you, you sitting there at home. do you think it will end at 10,000, 11,000 or 12,000? obviously, that kind of brackets. we're almost at 11,000, so you can choose 1,000 down or a 1,000 up or no progress at all or 1,000 up, 1,000 down and back to we are right now. however you see it we're talking about just the end of the year at that point, where will we be? just ahead, we're waiting for oil inventories and erin? >> and mark, well, president obama says drill, drill, drill, and well, the heads of saudi arabia say give me a break. we could care less. it's not going to bring oil prices down. we're going to talk about that and the best way to play the middle east. there's an economy on this earth that could grow 17% this year. yes, it's in the middle east.

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welcome back to "squawk on the street." matt nesto here. nothing's better than money in the bank, especially if you're

joseph a. bank. the stock is 4% higher after much better-than-expected fourth quarter results. same-store sales were up 6%. direct or online sales rose 12%. and the stock is having a nice bounce here today. jds uniphase, number two in the s&p this morning, almost 3% higher. thomas weisel reiterating the overweight rating, raised the price target. genworth number one on the s&p. louisiana pacific up 27% year to date, another 4% higher here today, and this after we're seeing the target and the estimates going higher at credit suis suisse. and viacom sees the full-year '11 and '12 estimates being raised at deutsche bank. that's good for 1%. they think the stock is inexpensive. let's get to david faber now for the latest from him. >> thanks, matt. i do notice viacom sort of challenging the tape there against news corp down and disney down -- excuse me, news corp is up a bit, but certainly,

viacom the biggest winner among the big media companies. i wanted to start off, if i can, with greece. when i left before vacation last week, of course, we had told you, you know, greece is still out there, still hadn't figured anything out. well, last week, they seemed to have figured something out, right? the eu and the imf, germany came around, they agreed to a deal. it hasn't done anything, though, for greece's borrowing costs. that's somewhat interesting. will it have broader effects? at this point, no, it doesn't seem to be, but it is certainly worth noting that the ten-year in greece, the ten-year greek yield right now up another eight basis points to 6.52%. that's a five-week high. you've got their two-year yield up 22 basis points to 5.13%. that matches a four-week high. and then even five-year greek cds wider by seven basis points to 340, just shy of a one-month high. so, greek borrowing costs not down as had been hoped, given,

of course, that we actually got the long-awaited deal to make sure that greece is not in any danger of defaulting. nonetheless, they're still borrowing what, 3.5% higher than germany. they're both eu members. here's a look at the athens composite, down another 1.5%. what have we got there on mgm? all right, that's probably just going to not be a deal. but let's talk also while we're on greece about financials overall. not a great start, you know, or end here to the quarter, but it has been a very good quarter, indeed, for the banking stocks in particular. the best performing sector during the first quarter of 2010 with the bkx, for example, up 21%. take a look at it now. yeah, it's down a little bit. zions bancorp has been the best so far. take that as you will.

many of the small cap regionals have performed very well, helping the bkx in part because of a more positive viewpoint on things like commercial real estate and the ability of these banks to withstand what is a difficult period there. take a look at zions, again, up 70% during the quarter. all right, mark, we'll leave it there for now. maybe i'll come back before the end of the show and say some other things. >> i would enjoy that. >> yeah, although i always love watching erin with all the camels. >> yes, indeed. >> yeah. >> well, have you ever noticed that most of the time, she goes places where there are camels? >> i didn't note that. >> yes. >> that's why i mentioned the camels. it's interesting. she loves camels. >> yeah. i think maybe there's something going on there. >> yeah, i -- >> got a thing about camels. >> it's okay. you know, the -- >> you're looking at me strange. check out her screen saver on her computer. >> is it camels? >> it's camels. >> yeah, it is. >> thank you, david. still to come, energy, one of the worst performing s&p

sectors so far this year, but is it a buy going into the second quarter? some names you may want to consider. plus, doubling down on the middle east. >> dubai has come to symbolize the new middle east, but is it a symbol of big excess or big opportunity? the inside trade, coming up. if you're taking 8 extra-strength tylenol... a day on the days that you have arthritis pain, you could end up taking 4 times the number... of pills compared to aleve. choose aleve and you could start taking fewer pills.

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welcome back. well, we are here in petra, jordan, and joining us, two investors who will talk about the best place in the middle east for your money right now. angus blair is with an egyptian-based financial firm. iyad mishal is based here in

jordan. good to have you both. we appreciate it. we've been telling our viewers, obviously, a lot of focus on the west has been on dubai and its troubles over the past six months or a year, but maybe people have overlooked some of the bigger trends, such as 65% of the people that live in this region are under 30. there's no other region in the world, angus, that can boast that in terms of potential consumers. >> that's right. the interesting thing, actually, the story about dubai has probably taken too much airtime, because there's so many opportunities, some of which we talked about in the past and hopefully, again. the demographics, obviously, a key factor. infrastructure plays, the consumer play has been vuy7 uq4e44 market, which is just beginning to take off, and the internal trade markets within each country and across the region is just beginning to take off as well. and speaking of world, because i started covering the region about two decades ago, but the last few years have been phenomenal growth. ca cairo in egypt is up in terms of sales per ian yum. >> and we have $1 trillion that

will be spent in this reek, and that money is in hand. money that they're getting from the pact that they have 60% of the world's oil. so clearly, there's an argument for that, but the consumer culture is also big here. and when there's a mall here, i've never seen a mall with so many people buying stuff as in this part of the world. >> absolutely correct. i would like to add to that the fact that lots of the countries here in the middle east lack malls, and the retail spending power has not yet reached the maximum. i think there is lots of room over there for consumer spending to be better, consumer spending to be bigger, consumer spending to be even stronger than it is right now, what it is right now. >> so, let's get the trades. both of you agree, and i said what country could be growing 17% this year? that's qatar, however you want to say it. why? what's the play? >> for us, in the first instance, qatar national bank, when you've got a country where you're getting over $80,000 per annum and gdp per capita, that's

going to be growing as the government is spending more on infrastructure, that's the first play, i think, for us. we've got another few plays as well, some consumer plays, but qatar national bank, clearly, are in front. >> the best one. >> absolutely, for us. >> what's your best idea of the region? >> actually, gulf international services company, which is a small play in qatar, and it's not actually covered. my way of thinking is more into the defishing style rather than lacking at the big caps. there's nothing wrong with the big caps, but i like looking at the small to midcaps as well and it's part of qatar as well, but there's something we need to talk about qatar or expand on qatar. why qatar and why all this "liking" for qatar? a couple days ago, they announced their new fiscal year budget, and there it was the highest ever, it was 35% growth over there and $32 billion of total budget. for a country like qatar, that's really huge, and most of that money is going to be for infrastructure projects. and interesting thing about

that, which i second what angus just said, is basically, banks started lending again, which wasn't the case six months ago. >> all right. well, thank you very much. we appreciate you taking the time. they both like qatar. by the way, both of them are incredibly optimistic, not just on saudi arabia, which they are, but on egypt. we'll talk about egypt and infrastructure, because coming up on "street signs," we'll have the chief executive of the biggest construction infrastructure company in the middle east and, of curourse, egyptian based, biggest construction company there. he'll be coming up in the hour. we'll have oil inventories coming up on the other side of the break and we'll tell you what the top of investments in saudi arabia had to tell me yesterday in riyadh about where he thinks oil prices will be.

welcome back to "squawk on the street." i'm sharon epperson. a build in crude supplies, bigger than expected, and a build in gasoline supplies, unexpected. boi both those factors taking oil prices off their highs of the session. we're still above $83 a barrel, but only up 79 cents right now. we were up far more than that a few moments ago. keep in mind, the energy department is saying that crude oil supplies were up by 2.9 million barrels in the past week, gasoline supplies up about 300,000 barrels and distillates fuel supplies down 1.1 million barrels, in line with expectations. we're also seeing the contract

coming off its high of the session. continue to watch the gasoline contract and keep your eye on the dollar. erin, over to you. n prices around $80 is healthy for both producers and consumers because it will maintain the cap expend at reasonable levels to

ensure supplies and availability of sufficient capacities.ç >> now, he literally knocked on wood when he talked about oil at $80 a barrel. what is saudi arabia spending all that oil money on, as they are the world's largest oil exporter? well, you're looking at a picture of it right now. this is calla university that w have about 46,000 female students attending when it's finished. it's being built by all saudi arabian construction companies. $11 billion just for that one university. it was pretty incredible. i had never seen so many cranes in one place, and i say that having seen dubai in 2007. they are spending that money in saudi arabia. sometimes it's hard to see it because it's pretty closed economy still, but that's where they're putting it by the way, i asked about prices at the pump, up 86 cents from a year ago at $2.81 in the u.s. he had no concern about that, seemed to think that that was a fair price for both producers and consumers. joining us to talk about whether drilling off the coast will affect that price, affect saudi,

is chris edwards and addison armstrong. what do you think, addison? in saudi arabia yesterday, they have no concern that anything the united states would do would actually dramatically affect near-term prices. are they right? >> well, yeah, they're right on two scores. one, you know, drilling, talking about drilling, actually drilling and then actually getting a product to market is probably a five to ten-year scenario in the best case. the second part of that is, if you're speaking to a saudi yesterday or any time over the past six months, there's been a great shift in their interest away from the u.s. market towards india and china. in india alone, they've doubled their exports to india. and the u.s. is no longer their largest export market. china is. so, you know, saudi arabia's really kind of not looking -- it's not facing the u.s. this is a generational shift. i mean, for 30 years, saudis' biggest consumer, their biggest issue and concern was how the u.s. would react to what was going on in the oil markets. they don't have that fear anymore.

>> addison -- >> it's a really interesting point, about both india and china. mark? >> i was going to ask addison -- i'll start with addison. would you please tell me what the demand-supply situation for world oil is? i mean, it seems like every five years, somebody scared the bejabbers out of us, saying oil's going to go to about $1,000, et cetera, and yet today, we've seen a very quiet oil market. where do we stand in terms of global supply and demand? are we in balance or what? >> we're actually very well balanced, and that's why you've seen prices not really moving outside of a band. we did move up at the end of last year and stayed sort ofç between $70 and $85 on the high side. and we're probably going to stay there for quite a while. i'll tell you this. you know, what we haven't seen is a pickup in industrial demand for energy. i mean, after all -- >> okay. >> -- industrial end users don't use oil. they use refined products like

jet fuel and diesel and kerosene and things like that. the supply at that has remained stubbornly at like 20% above normal for this time of year. add to that that there is plenty of spare capacity available not only in the upstream, but in the downstream as well and it's very difficult to get bullish about oil and products prices at this stage. >> well, i can think of one reason. chris, i have been thinking about this for a long time and i've been reluctant to ask any questions because i don't want to appear to be an alarmist or anything like that, but i think as an investor, you have to consider what happens to oil if israel makes some sort of move against iran's nuclear program? >> well, mark, international chess board is clearly a important part or component of oil price determination. and i think you look at israel, you look at the entire middle east, whether it's israel against iran, if it's iran trying to take an aggressive offensive position by doing something in the gulf. all of those things would

clearly have an impact. i don't think that that happens tomorrow. >> no. >> but it certainly could, and that's the big surprise, as is nigeria, as are all of the hotspots. unfortunately, all of the places that have a lot of oil are places that are very unstable, and that's a real risk to price. >> yeah. that remains -- even though, as addison says, we're in balance, the fact remains that it's an awful lot of oil in places that are really not entirely -- >> absolutely right. and mark, i think we're in balance, but the key is, we're in balance at $80 in arguably the worst economy in 30 years. and that tells you a lot, in my view, about the future direction of oil prices. >> all right, gentlemen, thank you very. . appreciate your input. >> thank you. >> chris edmonds, fig partners and addison armstrong. coming up, the biggest movers on the final day of the first quarter. and mark, where is all that

oil money going? well, it's going to build infrastructure projects. we showed you one in saudi arabia, but coming up here live in petra, we'll be joined by the ceo of the biggest construction firm in the middle e@ct, building all those roads, building the tallest tower in the world, nasef sawiri will be our guest live in petra. we'll be back. host: could swito 15% or more on car insurance? host: is ed "too tall" jones too tall?

host: could switching to geico 15% or more on car insurance? host: does a ten-pound bag of flour make a really big biscuit?

65% of the people in the middle east are under the age of 30, and yet, only 1% of the content on the internet is written in arabic, the language of the middle east. it shows you how much growth is possible in tech land. and by the way, a lot of big tech companies have realized that. you've got cisco here and microsoft and intel and yahoo! yahoo! actually just doing one of the biggest tech acquisitions in the middle east, buying machtube, which was the sort of

arabic facebook is a way of describing it. joining us to talk about the opportunity is ahmed nassef, managing director of the middle east for yahoo! and he joins us today from orlando because it truly is a small world, after all. let's get straight to the bottom line here. for yahoo! why did this deal, buying the facebook of the middle east, which actually is based right here in jordan, why did it make so much sense? >> well, it made sense because it really accelerated our strategy, erin, of really focusing on emerging markets. as you said, the middle east has one of the youngest populations in the world. the internet is growing by leaps and bounds every year. today we have about 50 million internet users in the middle east region, and that number's going to double over the next three years. so, having a local operation like maktoob made a lot of sense for us to really jump start this process. one of the key challenges that we have is content, you know. you just said, only 1% of the content on the internet is in

arabic, even though about 5% of the internet users in the world are arabs. so, that's one of the big challenges that we have, and on the top of my priority list is to provide really strong content, quality content for all the users. we're able to, of course, now bring in all the leading yahoo! products. yahoo! leads in e-mail, in messenger services, in newsç a sports all over the world, and we're able to adapt all of these products, customize them for the local markets. >> ahmed, for the american viewer, who's obviously familiar with yahoo! and also with american internet usage, how is it different here? obviously, it's not just the language, it's not just you read from left to right -- i mean, from right to left, it's something -- what else is different? what is different in terms of what they actually want to do on the web? >> i mean, of course, you know, the middle east is different because, obviously, language is different, you have local dialect, so you have the challenge of catering to 22 arab

countries, right? it's not just one country, but this population of over 300 million people. >> right. >> you know, different countries with different regulations and challenges, of course. but at the bottom, you know, in the bottom line is, in the end, the arab user is no different from, you know, what an american user might want, you know. in yahoo! our vision is to be the center of people's online lives. and whether you're in orlando, florida, where i am today, or you're in cairo or petra, jordan, people want to go online because they want to connect, they want to find out about the things and the people they care about the most and yahoo!'s really the leader in all of that. >> ahmed, a quick question before we go. do you find any link between the more restrictive countries in terms of men and women mixing, for example, where you might see facilitate dating and their use? i mean, what do you see in saudi arabia? >> well, the internet is -- i mean, saudi arabia is one of our biggest countries, right? it's one of our top two countries in terms of usage

online. and the internet allows a lot of folks -- >> okay. >> women, young people to really connect with each other. and we have a network of over 5 million users and saudis that are just women. so the internet is -- >> that is an incredible statistic. >> more freely. >> it's an incredible statistic on the 5 million bwomen. i'm sorry to jump in on you, but it's an alarming number. i want to get to mary thompson with breaking news. mary? hey, erin. we have details on the government's contract with morgan stanley. of course, morgan stanley has been chosen to sell the government's 7.7 billion shares of citi. and evidently, it's doing it for the government at very cheap rates. basically, for any share that it sells electronically, morgan stanley is going to receive a commission of three-tenths of a penny. any shares not sold electronically, the commission on that will be a penny and three quarters. sources are telling cnbc, ç typically, at least on the share of an electronic sale, you would

get a commission of 2, 3, maybe even 4 cents. so, very cheap. morgan stanley is doing this at a discount for the government and in addition, it's receiving a one-time administration fee for $500,000. interesting to note that this contract runs through september 29th. i've called the treasury to see why the extension, because of course, it said it wants to sell these shares by year end. mark, back to you. >> all right, thank you very much. straight ahead, a windfall for elite universities. and you may be surprised where that money's coming from. and what's coming up on "the call"? we'll find out.

welcome back to "squawk on the street." i am brian shactman with your "stimulus scorecard." it's that time of year when your sons or daughters may be deciding where to spend the next four years of their lives. if they're headed towards a research university, though, there will be a whole lot more opportunity. these institutions traditionally are absolutely grant-writing machines, but under the recovery act, they've seen billions more funneled into the system through the national institute of health, through the department of energy, even nasa. hear are some of the numbers for you. million obligated to harvad with 40 more on the way.

cornell, including the medical school included $143 million in grants and yale. it's a boom for these universities, but not all buried in the ivory tower. it does actually translate into jobs. >> the real job impact has been in the laboratories themselves. a typical research grant will have about 70% of its funding go to the salaries of the people working on the project. >> as you might imagine, it has eased budget concerns on campus, especially after many of the endowments of the institutions were hemorrhaging money in the financial crisis, but also raising some concerns here about what happens when the gravy train runs dry. >> in the laboratories, they have, indeed, built up. they've hired more technical staff and theyç hired more pos

doctoral fellows and we are, indeed, concerned what will happen to those positions at the end of the two-year period. >> smaller colleges don't have these kind of grant writing elements in these institutions. williams got aara money but it is money they were going to get anyway and they just put it under that in the budget. mark, back to you. >> still time to vote in today's street poll. where do you think the dow will end the year? 10,000. about 1,000 points lower than where we are. 11,000, which is right about where we are. or 12,000, 1,000 points higher. where will it be? not where it will go in the meantime. the results on the other side of the break. just a few more minutes to vote on the website. plus, a small region with an extraordinary goal. >> dubai sparked panic in global markets. we were there then and we are

here now. come meet us at the world's most expensive horse race, coming up.

part of the reason we came to the middle east right now is because we wanted to see the

social event of the year in dubai to find out if dubai was still dead or not. here's what we found. the world's biggest purse. $10 million for the fleetest horse up 67% from last year. the top horses raked in $26 million in prize money this weekend at the dubai world cup. the winners circled a brand-new track built for $2 billion with tapeta styling surfacing. traditional dubai style, over the top. you can watch in 3d and the course comes with imax screens and the ruler lives for horse racing. he is often in the stands at the kentucky derby and despite dubai's debt crisis, he is still worth more than $10 billion. he may have his horses, but as the debt crisis unfolds, will dubai remain a sporting capital? well, here is who knows the answer to that question. you have been looking into this.

will dubai stay in the top of sports? >> amazing that they're even there. sportsbusiness.com magazine says they're among the top 20 sport (t&háhp &hc the first time they have ever put them in there. you mentioned the $10 million that 6 million winner purse, $2.7 million is the breeder's cup, which is here. the question is, for that race, will those breeders want to bring the horses all the way to dubai? that is the big question. they have this dubai sports city, erin. which is unbelievable. $4 billion, 50 million square feet. it has three or four stadiums and it has training centers, manchester, united. they have a david lloyd tennis academy and butch harmon school of golf and ernie els golf course and a tiger woods course in dubai that is being built, currently delayed. you look at all this stuff and they are certainly trying harder than anyone out there.

>> and, it's amazing, people were coming. the people in the stands, there were people from local, local, you know, from the golf region and there were tons and tons of british people there. >> right. you know, the question is now you have to have the tourists and then you also have to justify some of these appearance fees. when you talk about the barclays tennises championship or the omega dubai classic which is a pga tour event, they paid tiger woods in 2001, $2 million to come. you have to have the visitors in order to justify the appearance fees and that will be the big question. they built this incredible infrastructure to be the best in the world in sports and we have to see if they can keep it up despite their problems. >> well, an interesting perspective there from darin. mark, by the way, i just want to let you know that i didn't allow anyone to film me with the actual do i wore at the