♪ hello, you're watching "worldwide exchange." the headlines today from around the globe. the indian market trades sharply higher. the opposition leader wins the election in a landslide victory according to the latest count. french telecom sector in warnings, the warning is under way. shares are trading higher. portugal is the second country to execute its bailout and the prime minister telling cnbc exclusively the path of economic reforms don't stop here. >> don't forget these three

years were very, very tough. no one wants to spoil. >> we go whale watching. gm's david evinhorn and buffet raising his on walmart. this according to the latest s.e.c. filings. >> announcer: you're watching "worldwide exchange" bringing you business news from around the globe. >> hello and a warm welcome to the last "worldwide exchange" of the week. plenty to get through today. we'll be in ireland and portugal and concentrating on the results of the indian elections. the bjp party looks for a resounding victory. 1 over 300 seats which gives them a comfortable margin over

the 272 needed for a simple majority. the ruling congress party has been taking a beating with initial leads indicating it's barely managed 60 seats. the market is up and coming back from a high. we'll be in new delhi during the course of the show. the gamble that failed. deutsche bank sold its las vegas casino complex to blackstone following heavy losses. monclair warms up and which have been stepping in to boost sales. will the tournament be marred by protests for the world cup or will a solution be found. jcpenney sales soaring. we'll take a browse over the

retailers' revival. progress made under the bailout is insufficient for sustained economic growth. this is the country prepares to exit the program this weekend. julia is not here because she's in the portuguese capital of lisbon from where she joins us now. exiting the bailout program. growth yesterday in the first quarter still very much negative territory. >> absolutely and i think the underlying fact is the recovery is fragile, yes, a lot are anticipating growth between 1 and 1.4 higher than the eurozone average but at the same time there's challenges for this economy, high debt level and unemployment for young people in particular at 35% so there's many issues they still have to address and actually the underlying message from the prime minister when i spoke to

him yesterday was, look, we have elections coming up. we know the cost of funding for the country has come down. that doesn't make a difference to the reform process and for the challenges and how we're going to address this going forward. but, yes, right now to bring it back to today and the next couple of days it's about ex exiting the bailout program and moving away from the troika. listen. >> well, we have worked a lot to achieve result like this. three years of tough measures and sacrifices for the portuguese people but at the end we have been able to reconstruct some trust on the financial markets, trust into people and finally we are in a sustainable

path to come back to a growth road. >> you've had some very turbulent times in the last few years. if i look back to just last year when there was concerns that actually the government may actually fall and we'd have to go to fresh elections in portugal have there been types when you've wondered whether you would actually exit the bailout plan or whether you'd actually need another one? >> well, a lot of people during the three years didn't believe in the possibility to recover the situation and to exit the program in a successful way. but i think in the government everyone believes that this exit of the program is a result of

the determination of the people because if the portuguese people didn't believe in the very capacity the result, the final result would be very difficult, indeed. >> it's something that we consider, though, if we look at the situation for portugal. i'm talking outside now of portugal. we see the country's cost of funding coming down, we see you exiting a bailout program so the surveillance is going to be less and then you say it's a long way away but we're still talking only a year till the next general election potentially. what's the risk here that you pull back on the reforms because these are the questions that are being asked? >> yes, of course, of course. i don't think there could exist a real risk to come back to any

responsible government and to in prudent budget policy. i think the general people, the general citizen know very well the cost of responsibility. so we will maintain the fiscal responsibili responsibility, the necessary support to maintain financial stability and we will boost the reform momentum. >> he talked about balancing consolidation and austerity with also trying to get elected and have the parliamentary elections and fresh general elections in portugal next year too and also why he doesn't believe that qe

is the answer for europe so plenty more to come but for now back to you. >> thanks very much indeed for that. more to come from portugal as she said. we have comments coming out concerning the mining disaster in turkey. the mine operator there says no negligence on the part of the company, the mine disaster. they say the exact cause of the disaster is still unknown. they are still also unable to reach part of the mine. we'll have more on that as we go through the program, as well. now, from one country that was in bailout to another, prime minister kelly says markets have been rewarding the country's financial discipline but that ireland has paid the price for austerity. let's go to dublin. steve is there. he's been speaking to the people and are they surprised by how cheap their borrowing has becoming particularly when you compare it to the uk and united

states? >> reporter: well, it is a pleasant surprise after all this country has gone flew after the last five years or so. i don't think they can believe their luck and not only fully financed the bond needs this year awe eight months covered for 2015 as well and spoke to the mtma back in february and said, look, you have to fill it to 8.1%. i apologized them morning saying it's 2.68. pessimism perhaps. 2.6% and spoke to the t shark. >> when it was inherited we

inherited an economic situation. they identify what the program is. define a program and do it and we're the first country in the eurozone to do that but came at a cost for hardship and financial difficulties and strained finances for hundreds of thousands of families in this country. not an easy thing to do. but bond yields have fallen from over 15% to 2.6%. that's an extraordinary shift in such a short time. >> it requires sacrifice. your midterm now. we have elections coming up, local, plus european parliamentary elections but moving into 2015, 2016 is the appetite for the stringent austerity, this sacrifice and indeed of course with what happens in the run-up to election, is the appetite going to be there from both your party politically, your government politically and indeed from the people? >> i think austerity is a much

abused word and prefer to call it fiscal discipline or financial competency. the mandate give ton me was twofold. one sort out public finances and get your country working. we have 90% of the adjustment done. the last big imposition and challenge for people has been the bringing in of charge, the last country to do so. evidence shows an extraordinary wastage of water through leakage and inferior infrastructure and so on so the government are focused. absolutely focused on finishing the job that the people gave us and that's to have our deficit below 3% by 2015 and move on. have it eliminated by 2018 but at the same time to use the flexibility in an economy that is now beginning to grow to show flexibility for taxpayers, remember, in ireland, the rate of 52% is the number and it's

much too low. if the economy continues to grow, if he's got the flexibility, he's got to show a response to people who have put up with a lot of challenges in the last three years. >> so comments saying you do not have the flexibility for fiscal retrenchment as well. high levels of taxes and increased levels, water tax, high marginal rates of income tax, as well have to stay in place because of this catastrophic huge level of stock debt the country has. >> this is part of the program we signed on before we exited the bailout program. 90% of people plus are compliant with the property charges. and despite the sort of fears that there were in the beginning this was going to be an extraordinarily high level of payment people have been accepting of the ranges that have been set by government for the contribution to be made here and the change has been brought at local government meaning locally elected politicians will

make the decision about how that's spent. publish those audits so that people in this country will see what they're getting for the taxes that they pay. they will know the services and the quality of thaem them that is being provided for them. >> that is ta ocearch talking to us. the problem we know, we had that in ireland and other countries. nearer to elections and further away from the event and people need to loosen the purse string and the problem for ireland and all these countries with over 100% debt to gdp and a big fiscal deficit no room to loosen off on purse strings but, of course, as you get into election cycles near in the medium term with the big parliamentary election in 2016 it's tough for the government to stay the line. that's what they'll try to do and find a little bit of extra money but gets politically problematic and they're being put under a lot of pressure under local tax, property,

water. the large marginal rate of income tax, as well so, yes, things are better but not out of the woods yet. >> no, not but a long way. steve, thanks for that. more to come from cub lynn later in the show. join i joining us with his thoughts, tim, good morning to you. good to see you. >> good morning. >> two days in a row they're coming off record highs for the dow and s&p. the russell 2000 on the other hand has been very weak over the last couple of months down off 10%. and we've got u.s. yields down at six-month lows on the ten-year. 11-month lows on the 30-year. what's going on? >> yeah, you certainly have small caps doing not as well as large caps in the u.s. you also have momentum stocks have been suffering recently. you start to hear more and more bearish voices. >> some coming on later in the show. >> the reality is it's very hard to be bearish in an environment where as you say in the last week the s&p 500 hit an all-new

high, so did the global 1200 and in europe, the europe 350 is, you know, at a better place than it has been at any point in the last six years. a difficult environment in which to really support a bearish sentiment. >> yet must be very hard to find anything you want to buy, as well. >> i think, well, opportunity is definitely hard to find. volatility is down in every mark we look at. bear in mind volatility, the swings in the markets, that's how traders make money. >> yeah, volatility is incredibly low and not just what's happening but what the market expects to happen in terms of yields and our measure of volatility, u.s. policy, the vix -- very, very low. >> in terms of yields no one is expecting them to dip back below 2.5% and might have been a bit of a move yesterday when there was a story there would be retrospective tax giving it

impetus but broken technicals and no one is expecting that and that presumably shakes everybody up. >> it may. i think, you know, you'll always find bulls and bears and no one expects them. some people -- >> there will be some people -- >> yes. >> could have been a big short squeeze. >> when we're in an environment which i think we are in hard to identify one particular risk that can the great risk facing market, most markets are up in europe, you know, we've heard about two great stories today. what can you do? well, there's still things you can do. the first thing you can do is diversify. no particular risk you want to manage against, then why not spread your bets and the second thing that you see and we see our clients doing, just cutting costs doing simple is better. >> as costs come -- is a big thing actually. this -- particularly markets like this. if you have the lowest possible fees, makes an enormous difference when you compound

that over time. >> it can do and we've just seen the uk advise local pension funds that actually, you know, if they move to a low cost simpler investment style they can save in the uk $660 million per annum which is extraordinary. more than the london -- >> just finally we have indian shares up a record high clearly a majority of the vjp has been bolstering that. do you think that is a market that's priced in too much? >> good question and we heard earlier do markets anticipate or react? they certainly anticipate a wind for mody. is it priced in, i think that's the role of the market. of course, it's priced in all those who have a view have taken their view and it does look very much as if mody will not only win but gain an outright majority. >> tim edwards of index strategy at s&p dow jones indices. all right.

we've been talking it and let's show. an hour and 17 minutes into the trading day here in europe. you can see we're weighted to the downside following the sell-off regarding the states. dow around 1%, s&p off 0.9% as well. the worst for about a month for u.s. indices and decliners are outpacing advancers around 7-3, a little more than that at the moment. yesterday the dow, the ftse down 27 points and the ftse is one that hasn't reclaimed all-time lev levels. this morning it is flat as is the xetra dax. contact current off 0.1% so going nowhere fast. where we stand with the asian markets. where they've closed up for the week. the nikkei down 1.4% and s&p up a percent up 4% during the

session. pretty much on the session lows so we rally strongly. let's see the initial buying. the s&p sensex down 1%. in terms of individual stocks here on french telecoms, here we go, up 3.38 this morning and the french minister said that essentially talks are under way over it and bouygues and would reduce the reports and suggest that orange is considering a purchase of bouygues. orange up 03/4 and numericable in talks to buy another firm. up 11-month highs against the dollar. there we go. where is it, here we'll get into

the indian election results and whether what the markets priced in can now be delivered.

snow. the hindu nationalist bjp led by the charismatic modi looks like a resounding victory in the indian elections. now that you are in india, what do we think is the size of the victory for mr. modi? >> reporter: the size is sizable and let me just say this, 272 is what was needed for a simple majority in the lower house of the indian parliament. you can see behind me on my left shoulder. what we know now is that mr. modi and his bjp-led national democratic alliance have secured more than 300 so this is what you would term a super majority. this is good news. this is good news for the markets and that's why they are

rallying. this is good news for the indian bonds, as well. let me explain why. because it means that they won't have to be involved with any horse trading. any fractious coalition building which so much undermined the basis of structure reform and won't have to do that so the government will be speaking with one voice and that means that the reform momentum should be quite smooth. we were in the -- we were near the bjp headquarters in the capital earlier on and as you can imagine it's a carnival-like atmosphere people chanting modi's name and two elephants there and it's symbolic but also highly important to note that these issue, the structural reforms turning the economy around is an elephantine task and many supporters realize this and look at a one to two-year time frame and they're confident

here's the man for the job and the markets seem to think so, as well. the next step, ross, the composition of the cabinet and most importantly the finance minister. i believe it's going to be aaron -- the markets like him. let's wait and see if that does happen and could give further momentum to these markets now. right now, they're riding the modi wave. that's for sure. >> sri, thanks very much. let's get analysis on that. canty is here. thanks for joining us. a lot of faith has been put in mr. modi. we've got the sensex up at an all-time high, 16 billion pounds has been poured into indian stocks and bonds in the last six months. so so the man that people think he is? >> he's the man. he's very decisive. i think the best analogy probably is to putin or to erdogan in turkey politically.

he is a nationalist. he takes quick decisions. he's bold but he can be scary, as well. >> all right. so is he going to be bold and scary enough? >> you know, he's going to start out i think fairly quickly. as soon as he has the cabinet going and has taken stock. he sees himself very much as someone who moves quickly. he listens to experts but he makes up his mind pretty much by himself and i think he's going to try and use things he's learn learned at the national level. that's the promise, but that's also potentially a bit of an achilles' heel for him. >> now, as we heard sri say, look, it's good news the government has an outright majority because politics would have been difficult. what control will they have over state governments because if you don't get that, you're still going to have difficulty implementing the reforms. >> exactly. and that's my reference to the

achilles' heel really. it's one thing to run a good state but deal with 27, 28 fractious indian states with all ministers think they're hot so i think getting them to go along with him even if they're from his bjp party or one of his allies is a challenge. there are economic nationalists within the rss, hindu militant organization that's behind him as well as other hindu front organizations going back to the 1990s. they've been quite troublesome on the economic agenda. >> what is the realistic expectation then and do you think investors got ahead of themselves? >> well, i think he's got a good thing to begin on. everybody is fed up with corruption and stagnation and hopelessness and so he's

certainly going to have a year or more to get things going and i think that's really the good news. i think the other piece of good news is that he does bring a group of pretty good people in the bjp in terms of good administrators and economic mines so that's the good part of what he brings. >> yeah, and he's going to need them. he's certainly going to need them. thanks, indeed, professor for joining us professorary bajpal. portugal is prepared to bailout but the bankers warned on growth. julia will have the latest for us from lisbon. [ female announcer ] there's a gap out there. that's keeping you from the healthcare you deserve. at humana, we believe if healthcare changes, if it becomes simpler... if frustration and paperwork decrease... if grandparents get to live at home instead of in a home...

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opposition leader narendra modi wins the election in a landslide victory. according to the latest numbers he has an absolute majority. the french telecom sector in ruins. talks are now under way between firm firms and share as cross the board are higher. portugal the second country to exit a bailout and telling cnbc the path of reform doesn't

stop here don't forget these three years were very, very tough. no one wants to spoil the sacrifices we have made. >> and let's go whale watching. major investors sell out of gm, david einhorn has got rid of his entire stake of the fund and warren buffett raises his in walmart according to the latest s.e.c. filings. we're now a half nour into the trading session and flat really. the ftse 100 going nowhere. xetra dax down 0.2 and cac 40 is down 0.1 and treasury at the moment bounced off that 2.51% and down to 2.47% and german

yields off that their recent lows, the yield gilts yields up 0.02 currently at 3.10 in italy. the euro then rebounded from its low of 136.50 which we hit during the session, currently at 1.3790. and sterling ling just reclaiming the 1.68 mark. now, portugal's central bank warned progress made under the bailout is insufficient for sustained economic growth. this is the country preparing to exit the program this weekend. julia is in lisbon where we turn to her with an important guest. >> reporter: thanks so much. ross. you know, first i want to less you listen in to more about what

the prime minister of portugal was telling me yesterday and, of course, we've been speaking a lot particularly in the last 24 hours of the pullback we've seen in bond yields particularly in the likes of greece and portugal in particular. well, we've been talking to what the bank has set up about the issues and challenges that the country is facing irrespective of whether or not the troika on board overseeing the progress of the country, the question i asked the prime minister was whether or not actually the markets right now are underestimating the challenges that the country faces. listen in. >> the markets know very well the situation, the financial situation of portugal, of spain, of italy and so on. the result of the ecb policy is now showing the first. no doubts about the euro compass

toy to that. that's the main explanation from the stress and confidence on the recovery of these countries. in second place, i think that the first message that the po portugal sent to the markets is very important because we are saying the bad years are in our back, of course, but we didn't forgot the situation. >> so one important person to our next important guest as ross just briefly mentioned there. i'm joined by fern nando, the ceo of banco at epi. the bond spreads we see for portugal on whether or not there's a disconnect with the fundamentals here. would you agree with that? >> no, i don't think so. the think the market is recognizing the majority -- that

the portuguese have wanted to recover our country and used to have very significant external deficit. now we are in surplus. we have conservatived reduced the budget deficit, the economy is gradually picking up. investment is coming back. namely including in real estate which for years was completely stagnant. now we have outside investors like the chinese, the brazilians, the french and ot r others investing in portugal. this place where we are speaking, the center of lisbon is now very fashionable among outside investors and prices are going up. which is an indication that people believe in portugal and the future of portugal so i don't think the market is underestimating the risk, in fact, i think our debt is priced

in comparable terms to other countries in similar situations and we have better indicators than some other countries including spain or ireland in some aspects we are doing better than they are. so i think the market is right as always. >> so you're saying actually that portugal's debt should be actually trading better than the likes of ireland and spain right now. >> well, i think -- i think the situation is fair, the present situation, it was just pointing out that in some respects we have better figures than spain or ireland. >> you almost though make it soup as if there aren't people here struggling. we have a high unemployment rate. youth unemployment at 35% right now and actually support for the government has also slipped in the polls. do you expect them to be punished next week at the european elections? >> well, i'm not the politician. it's difficult to evaluate, yes,

it's true that unemployment increased a lot during these adjustment period but it has already started to go down, which is a very positive indicator and fortunately youth unemployment is a problem there is not a specialty of portugal but exists in many other countries but frankly i'm more worried with the unemployment of people above 45 because they may have more difficulty in getting back to the labor market. they anger people. i think they will find a solution either in portugal or abroad because many of them are also looking for projects outside portugal and are doing it successfully, so as the cities i'm more worried with the unemployment above 45 or 50. >> it's a huge challenge but

also debt levels are whether they're the government, whether they're households or, in fact, corporates, also from your sector, the banking sector, the ba banks -- there's still confirms that they need too. do you see that as the biggest risk for the future performance of the portuguese economy. >> no, i don't think so. i think banks have also done their part of the adjustment. household debt is thought a problem. i don't agree with that view because we have very little consumption so people have not borrowed a lot to buy electric appliances or cars or they have mainly borrowed to buy a house and the loans are indexed to short-term interest rates and because they are very, very low it's close to zero arrival and the spreads that banks use to charge until the crisis started were low. it means the monthly installment

families are paying for their mortgage is probably the only part of their monthly -- of their family budget that has improved during the crisis and that's why nonperforming loans in the mortgage sector is not a problem for the banks, the profitability of those loans is a problem but not the credit risk, so i think both banks and the families we will cope with that. >> yeah, you said it there. that's the crucial element here. just very quickly, one final line on the continuation of reforms in portugal. >> well, we are all aware that the story doesn't end now. we have corrected the main imbalances we have and that was a precondition for the future growth of our economy, but we continue -- we need to continue to work very hard and improve the competitiveness of our

economy. but it's amazing how we have been able to do it being a member of the euro so our companies are able to compete having the same currency as the germans or the french which is a very strong indication of our competitiveness. >> it was almost an in spite there. in spite of being in the euro you've managed to do it. fernando, the ceo of banco bpi, ross, on that important note i think i'll head back to you. >> thanks for that. more to come from lisbon. and we'll also be focusing in on ireland in a few moments before that the operator of the turkish mine in which hundreds have died just wrapped up a press conference, the fill has denied any negligence in the disaster adding that the exact cause is still unknown. this is as anger has been growing of the government's growing of the worst mine disster. the prime minister responded by

saying mine accidents are not uncommon is coming under moutsing criticism. pictures of one of his personal assistants lashing out at a protester have inflamed tensions. stories making news in asia. china drew ho billion during the first four months of 2014. that's up 5% from a year earlier. with the major share of investments going into the services industry. this is on track with the government's ambitions to attract fdi two services high in manufacturing and environmental industries instead of lower value factories. the same time anti-chinese riots in vietnam have turned deadly. there have been suggestions of some fatalities as mobs attack chinese interests across the country. this in response to china placing an oil rig in the disputed south china seawaters. the violence has been indiscriminate in singapore and

taiwanese and thousands of ex-pats try to leave. meanwhile, china's apple supplier shut down its facilities in vietnam for three days citing safety reasons. still to come "worldwide exchange," irish bronze have fallen below levels and equaled u.s. treasury yields this week but how real is the recovery post bailout? we'll find out next. we needed 30 new hires for our call center.

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warren buffett added berkshire hathaway's bet on walmart, increasing it 17%. other big investors or whales as we call them coming off the closing bell. many of the big names ended tear stake in troubled automaker general motors so we want to know, are you going to follow? do you follow the big investors? the trades of buff fest and einhorn worth copying or do they only work for the bigger investors? get in touch by e-mail at

worldwide @cnbc.com. is it better to follow buffett than do your own research. the irish prime minister says markets have been rewarding their discipline but how real is the recovery post-bailout with the banking imminent. here's what some of the people we've been speaking to are saying? >> they made a decision to give a blanket guarantee and made a decision about banks in the middle of the night. i'm not interested in that sort of philosophy. what i am interested in is that the irish people should know the facts, they should know the truth about the policies, about the person sell and institutional failure that led to this catastrophe. you've got to put in place the situation where that can never happen again. >> only the bankers and boards of directors and chief executive -- you might say

regulator and other politicians do but they were issuing the bad loans taking out bad investments so who we teed to see in these banking inquiries coming in are the people who come into the government the night of the guarantee. we want them to tell the public what they told the government that they're ready to close up shop that they had destroyed their own banks and came on their hands and knees to the government to tie to keep the banks open. >> well, we think politics is a model of choice and the other parties are making their own choices. they are loading ordinary people, working people with huge debt from private banking, from greed and corruption and that financial system. >> some thoughts of those speaking to steve who joins us. steve, you're saying they've gone through an awful lot, but there can't be a promise of easing up. >> reporter: yeah, i think the risk is, of course, everything

thinks we're out of the bailout program and the market is 2.of for our ten-year paper and everything is rosey. looking at the economic fundamentals with the massive deficit and debt to gdp still over 120% plus the big unemployment picture, the question is can they? let's get a business perspective. danny mccoy, ceo of ibec joins us, as well. no lessening off the austerity yet i hear them saying we want more money for infrastructure and what do you want, tax cut, as well. >> yeah, tax cuts. more investment in infrastructure because, while the austerity phase is over, the government is going to achieve its deficit targets and debt ratio is coming down because of growth. the economy in our view is growing at more than 3% now and had some bad gdp numbers but looking at employment growth is 3% and see it growing 3%, the business model is strong and going back to 200 the a turn in the economy even back then.

public finances and property we've had problems with. >> but in brussels and imf in place, no, if you loosen up on the fiscal discipline, let's leaves word austerity aside and loosen up on that you are going to go back to the bad old ways because you still have such enormous debts which need to be service and pay down. >> loosening the fiscal discipline but achieving those targets so that what's committed to will be delivered. ireland has delivered all the way true this program. what we're saying in order to insure that, growth is a solution here and so the tax cuts are on the individuals. overall texas revenues will come in on target or even better because the buoyancy in the economy. this economy in money terms is likely to grow at near 5% this year. >> we heard from the taoiseach and sean fleming and gerry adams are beginning to fight each other and politics are looking more polarized.

it seems we're out of the shock and awe of austerity and now fighting about who can offer the most to the paplation. is that because of the election cycle we have this or something else going on? >> partly the cycle and fatigue but the argument is that the domestic politics will always have those type of attentions. business model is a globalized business model and very well diversified so economic resources have been to come back here. it is true that the sovereign is able to get ten-year money at 2.6% but we're seeing a wall of private equity money buying up in property and great businesses, so ireland remains a really great bet and still great risk of return and 4% to gdp on infrastructure and have a long way to go on broadband even on our water infrastructure. >> do you think the corporates have had it too easy and population has had it too hard? i know what you're going to say. you have a corporation of what, 12.5%, the marginal tax rate on a low amount of money is over 50%. it's out of kilter, isn't it?

>> it is at the marginal. average tax force incomes here are quite high, as well on higher income groups and doesn't go down the whole income distribution. the average tax on income tax in ireland average is around 1%, as well as it happens. lots of people don't pay any income tax with the generous tax credits but do have a problem in the distribution of taxes in ireland. it is the most progressive income tax system in the world. it's number one in the oecd so people on higher incomes are feeling that. government is going to have to address that. >> all kinds of risks that we don't know out there. but what is the biggest domestic risk to the irish recovery story? >> missing the good times here because with the pricing back in, off, investment, people say we have lots of debt but the net present value are coming back into the black as a result of cost of capital going so low. my biggest fear we'll fail to grasp that and give us a spurt of recovery will clear our debts but get more back to work and

increase the size of our labor force. >> they say they reckon the coalition might split if labor have a bad set but finafoil would say that. >> there is a risk people would get inward looking but the opportunities are immense for the economy so hopefully we'll get over the interim domestic peace and elections are only a couple of weeks away, a week for local europeans but get more stability. >> danny, always nice to see you. danny mccoy, ceo of the business group ibec. so, things looking better but the biggest danger we miss the growth opportunity. back to you. >> danny there talked about the progressive -- how progressive the tax system is, steve. and, you know, need to cut taxes for the well off. is that actually going to happen? what's the chance of that taking place? >> yeah, it's very interesting. i raised this question with mr. kenny of the taoiseach and

said mr. noonan hasn't got much room for maneuver. two budgets now before the 2016 general election as well so he's got to start showing people a little bit. i got the impression from my interview with the taoiseach, the prime minister that they will be showing something, whether it's at the margin or periphery remains to be seen. you can bet your bottom dollar there will be tax incentive if not one but both budgets coming up. >> thanks for that the latest from dublin. now, some of the other stories we're following. credit suisse is poised enter into a guilty plea. the settlement could deal a $2.5 billion blow to the swiss lender accused of aiding american tax dodgers. still unclear whether u.s. regulators are considering that the guilty plea could be announced as early as next week. credit suisse share prices 6.6% so far this month. and the gamble that failed.

deutsche bank is to sell its las vegas casino complex following heavy losses. germany's biggest bank agreed to sell the cosmopolitan resort. they lost $100 million a year since 2010. also deutsche bank traders have been warned. the lenders apparently sent out an internal video to its staff saying boasting vulgar comments and indiscretion are not okay. colin fann, co-head of their investment bank appears in the video saying that reputation is everything and that some staff are falling way short of their established standards. the uber is seeking another round of fund-raising which would value the company at $10 billion. nearly three times the $3.5 billion valuation from just last year. $10 billion ub uchlu -- uber woe

up. a lot of promise they've got to fulfi fulfill. fairly mixed day in europe. ftse 100 is up and u.s. futures, we saw the falls yesterday and down over a percent and s&p down just under 1%. second day in a row we've been off worst declines in a month. futures today suggest a cautious start to the open. we're currently 6 points above fair value, the s&p is on fair value and the nasdaq is around 3 points above fair value. so all to play for one would say later. now, the operator of the turkish mine this which hundreds of people died has just wrapped up a press conference, the firm's denied negligence in the

disaster adding the exact cause of collapse is still unknown. this as anger has been growing over the government's handling of the worst disaster in turkey's history. the prime minister responded by saying mine accidents are not uncommon has been coming under mounting criticism. picture of one of his personal assistants lashing out at a protester have inflamed tensions. now, in the second half, more to come on that. also, can you hear the bears growl? find out why the so-called godfather of tech analysis is warning of a megacrash to come. does it stack up? what is he saying? [ female announcer ] there's a gap out there.

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i'm ross westgate. indian stocks trade highly higher and modi wins in a landslide victory. he's got an absolute majority. jcpenney stock, sales jump in the first quarter and retailer returning to its no frills roots. going whale watching. major investors sell out of gm. david einhorn got rid of his entire stake in the carmaker. one profit raised his bet on walmart according to the latest s.e.c. filings.

and portugal is the second eurozone country to exit its bailout and telling cnbc exclusively that profit and economic reforms doesn't stop here. >> don't forget these three years were very, very tough. no one wants to spoil the gains we have made. with. the nasdaq off 0.75%, as well.

a switch back to that with just five points above fair value for the dow and s&p is on fair value and nasdaq at the moment is just around 2 points above fair value. now, european equities meanwhile, have also been fairly flat and cautious, as well. move on to the european stock, thank you, the ftse 100 just up 11 points and xetra dax and cac quarante are fairly flat and nasdaq mini is up 0.8. treasury yields and during the session, ten-year yield on treasury sitting 2.47%. which is down at fresh six-month lows and just over the 2.5%. now, undoubtedly helped along, and we've got reports there was going to be a retrospective tax on greek debt which the government came out. no, that's not going to happen but pushed yields down hitting lows of 3.3%. this morning we're just bouncing back off the yields.

gilts yielding 3. -- 2.54%. currency market, euro dollar bouncing off its 2 1/2 month low, 1.3650. just at 1.3718. dollar yen fairly steady and sterling reclaimed 1.68. a week ago up near 1.70 getting fresh five-year highs and rupee hitting an 11-month high, just back up to 59 this morning. indian shares hitting a record high, as well all in the fact that narendra modi seems to have secured over 300 seats in the indian elections. it's an absolute majority. they needed 272 to make sure there weren't any compligs

polit -- coalition -- and expectations of this great things are expected of mr. modi and his ability to deliver reform to that market. now, more on that to come, meanwhile, bring out the bears. raf phi kapoor told us yesterday that the s&p would drop maybe 10% or 15% between now and october though warn it had could be much worse for small cap, midcaps and tech stocks. take a listen. >> now, if you ask me about the midcap i think you're talking 20% to 25%. i call it a stealth bear market. >> we'll get more with carter worth. before that what's going to get wale watching. the u.s. biggest fund managers revealed their s.e.c. finds.

the figures show big investors are reacting by general motors and their recalls. david einhorn dissolved their stakes and warren buffett's berkshire hathaway took a new 11 million stake in verizon while adding to its stake in both walmart and liberty global. barry rosenstein's partners took a new 4.9 million share stake in ebay in the first quarter. average even david ticker has been buying just days after the top fund manager said he was nervous. the latest s.e.c. filings show during the last quarter he was buying some stocks so what's been on his shopping list? he added to his position to google class qa" and facebook, expedia and priceline. so that's what the whales have been doing. also the thoughts of ralph acampora with us from new york.

good morning to you, carter. i don't know whether you heard the warning from ralph acampora. what do you think? >> well, ralph is one of the long-standing market observers that we have and, of course, there are a lot of technical things going on that are not good. we do know one thing, yes, that we have the precondition for trouble which is we have a long, mature bull market. we have a five-year bull, bull markets do have expiration dates and the fifth year, 2013 was particularly robust. 30% s&p. and thousand this stall so the bulls think it's the pause that refreshes. this sideways action, the bears and i mean that category that it's a stall that foreshadows trouble ahead. so we're definitely in ralph's camp and anyone else who's taking the cautious view of market's current behavior. >> he says last time he saw

something like this was in 1994 when the s&p went on a 10% trading range and under the surface sort of ripping them apart. the s&p down 6% from the highs of march 1994 to june. the nasdaq down 14% in those three months. what are the compare -- would you take comparisons with that period? >> well, not so much from my point of view in the sense that 1994 was a very quiescent year but the greatest setup for the greatest bull run of all time. no five here year run where the s&p was up 20% or more consecutively and that happened in '94, '95, 'the 6 and '97 and '98. it went nowhere because the fed doubled the cost of money and fed funds went from 3% to 6% and when you do that, all people have to adjust their cap "m" assumptions and so they couldn't handle that until they could which is to say they had to

figure out what its meant and took off from there but we obviously don't have that circumstance here. so not sure that analog works but very much do believe that this is not a good period to be putting fresh new money into the market. >> yes, and i mean this is what tempo was saying. he's not going short either. would you short it? >> well, sure, surely. yes, we think that's very much the opportunity here. there are huge downdrafts which just you cited in individual parts and parcels of the market. we know that biotech is down some 22% from its high. we have vivid joe sin contractic tech names and biotech names down 40% and 50%. in fact, the greatest opportunity of the past six, seven months has been on the short side. we think there's plenty more of that type of opportunity and limited opportunity on the long side. in fact, the only things working are things that just classically

defensive meaning it's a fear-based trade to buy utilities, to buy staples and that kind of thing and the pickings are slim. >> in particularly you've been focusing in on financial stocks and how much the leading financial stocks are -- make up the s&p 500 financial sector. is this where you see particular potential weakness? >> well, that is a very big concern and i think right to bring it up in the sense we know there are ten parts that comprises the whole. ten sectors and while the biggest of course is technology at 18% of the s&p, financials second biggest at 16 but most important because, of course, financials are the lifeblood of the system and we have major banks in the united states that were in up trends however you choose to measure that basically ascending that are now no longer ascending. they've rolled over, jpmorgan, bankamerica, citigroup and see it across europe whether it's

barclay's or credit suisse so heretofore, strong steady advances given way to something else and stalled and rolled over and think, of course, that is a foreshadowing of things to come and happening in goldman sachs, morgan stanley and, you know, there is an old adage one has to be mindful of as financials go, so go the market. what would have to happen for you to change your mind before we let you go? >> sure, you know, it's interesting. back to that 1994 thing, that, in fact, that would be quite constructive in the sense if and as the market were to really basically consolidate and that's what a move sideways represents, meaning we have a big year last year up 30%, five-year bull. if you were to consolidate all year long and basically neither deteriorate nor improve that really would be the pause that refreshes so it would be a time thing that would allow me myself anyway to take a more favorable view. but that time has not elapsed at

this point. >> well, although we are trying to do it -- that's what we've done so far so maybe in the rest of the year is like the year so far, we'd be okay. >> maybe that will be okay. >> all right. good to see you. >> likewise. >> chief market technician at sterne aagee. hape housing starts at 830 a.m. so investors certainly watching this number closely again today and, of course, it's the focus of the fed. 9:55 an early look at may consumer sentiment. jcpenney shares spiked after the close yesterday on a strong earnings report. the company posted better than expected sales of $2.8 billion and a smaller than expected loss per share. the firm also changed its tune on coo saying there's no longer a session plan in place and no major changes on the horizon.

for the current quarter, the firm expects to see single-digit growth in comparable store sales. shares are up more than 16%, a big move higher. other story we've been following, mentioning this earlier. the hindu nationalist bjp party led by narendra modi looks like it's headed for a resounding victory in the indian elections. the party has won over 300 seats which gives them a very comfortable majority over the 272 that were needed for a simple overrule. the ruling congress party has taken a beating with initial leads indicating it's barely managed 60 seats. investors very much liked that outcome here. one stated the sensex up 4%. up around a percent at the moment but as you can see, we have quite an awful lot in in terms of getting to successive market highs over the course of this week. now, away from that, don't

relax yet. portugal is preparing to exit its 78 billion euro boehm with the country's national bank warmed on growth and the latest with julia in lisbon.

recap of the headlines.

narendra modi wins the election and stocks jump. jcp shares soar after first quarter numbers beat the street. and s.e.c. filings show major investors sold out of their positions in gm in the first quarter. ♪ meanwhile, portugal is on the path to growth. that's the verdict of the prime minister speaking exclusively to cnbc as they prepare to exit the euro program. julia is in lisbon. julia, fair to say they're on the path there. when will they get there? first quarter we saw yesterday and still in contraction. >> reporter: now, you're absolutely right, ross. there was a funny thing in the data towards an oil refiner that i should point out. the recovery is still fragile in this country but i think the point that we go to when i spoke to the prime minister actually is there's been huge strides forward to increase the competitiveness and address and

shore up the financial situation at great cost to the public. in the space of just two hours this morning i had six people come to us asking for coins, for food and to go and get a coffee so i think it just brings home to you the desperate struggle of the people here and that's going to continue because austerity, the consolidation in portugal has to continue even though they're exiting the bailout program and the risk is that given that the troika, ecb and imf will leave, the market is buying into this recovery story and, of course, we've got elections coming up for portugal too that actually the government here take the foot off the pedal as far as the reform process is concerned. and i asked the portugal prime minister whether that was the case and whether there was a risk of relaxation on reform. listen in. >> don't forget these three years were very, very tough. no one wants to spoil

the sacrifices we have made. >> no matter what happen, the consolidation will continue. the commitment to reforms is going to be reignited. a real commitment to continue the work and, oh, boy, they have an upward struggle, ross, i think. >> jules, thanks very much indeed. meanwhile, the irish prime minister kenny says they've been rewarding it but they've paid the price and steve has been in dublin speaking to the irish leader, steve. >> if you take away julia's sherry and replace it with guinness, it's the same story. they have to stay the course. let's face it, the relationship over last couple of years between the bond markets and

financial markets more directly have been dysfunctional and spoke to the prime minister who has been shepherding the country through this period from 2011 to now about that relationship. let's listen in and see what he said. >> objective opinion was you have no credibility. you can't be trusted. >> right, okay. sorry. had problems with that and take a short break. still to come on the show. which hotel group claims to have doubled the size of its luxury footprint in just five years. check in as we make a reservation right after this. ] it's one of the most amazing things we build and it doesn't even fly.

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the gamble that failed. heavy losses and germany's biggest bank agreed to sell cosmo toll tan tore blackstone for $7.3 billion. the cosmopolitan booked losses of $100 million a year since opening in 2010. one group to note that knows how

to run hotels is starwood and says emerging markets -- it claims its upper end footprint doubled in the last five years. joining us is paul james, global luxury brand leader for starwood hotels at the st. regis and thanks for joining us. just a word. are you in casinos? >> no. >> a different -- >> casino is a different business than the hotel model. hotel world is all about the traveler, the business guest, the luxury guest, where they're going, what they're doing and where the business takes them. that's what we're seeing, this massive growth in premium high-end travel. >> this is happening since the effort of the financial crisis. >> yeah, i mean -- >> why do you think that -- people have talked about the rich have got richer because of central bank policies. why do you think that's happened. >> i think what we're seeing here is the growth of the middle

class. it's 3 billion people moving into the middle class. it's driving business demand and driving demand in two areas. >> this is emerging market. >> emerging markets. it's just -- it's a mix of the north american business which drove i think international hospitality for two decades. has been supplemented by the growth in indian market, chinese market and sort of continued emergence in latin america. >> you've doubled your luxury footprint 90% of the pipeline now in emerged markets. >> yeah, you're looking at indian growth, chinese growth, southeast asia and latin america. not to say north market is not growing. and we're adding three luxury hotels opening in the next six months so the states is still a strong market, it's the supplement. venice, we've had one of our strongest opening quarters in venice ever because in addition to the strong u.s. business we've had new business come in

from china during the holiday season. we've had indian business over the last couple of years grow and grow and tend to travel slightly out of kilter with the traditional markets so that's driven occupancy which has -- >> what is a luxury group or hotel need to have if you're opening today to get the travelers in. how important is technology in the digital side? >> when we did some focus groups in italy to talk to new customers and existing customers and whether there were a couple of 80-year-old well-established italian travelers or young models from asia. two things, shower that works and wi-fi works. and that's where we're investing and business we're investing in our brands and investing in the technology that allows us to have that relationship with the guest. at "w" we'll pilot a new check-in. if you have the preferred starwood application on your smartphone your reservation will

send you a note saying you're in room 601, go up the lift, tap the door and walk in. >> how do you walk in? >> bluetooth. >> on your phone. >> your phone will open the door. >> i kind of like that. so there is something -- traditional check-in could be a thing of the past. >> this is a bad choice. so today you're a business traveler and stay in a hotel every other week, you want to get straight to your room and on with your life. going on vacation, first time in bali, you want to enjoy that experience so you're in control and i think -- >> you're opening 8 to 16 hotels a year. >> at the moment, yes. >> how much of those are now you just managed the hotel and there is a partner who owns the -- >> it's all about getting the right partner working with -- we own very few hotels as a business. it's about our relationship with our customers and brands so find the right partner and develop the right hotel and that brings

return. what's interesting about demand is we've seen the speed with which these premium hotels come to market. used to take three to five years to reach peak. that's happening in 18 months because of that level of demand on the global basis. >> it's a brave new -- paul, thanks for coming in, paul james, local brand leader for starwood hotels group. don't forget cnbc's jim cramer is ranking the four biggest hotel stocks including starwood along with hilton, go online to see which one he thinks will pay off. take a short break as we go to that. futures indicating, u.s., we don't know which way we'll open after the sell-off we saw yesterday. we'll be right back. [ female announcer ] there's a gap out there.

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the indian stock market sharply higher. opposition leader narendra modi wins the election in a landslide victory and has an overall majority. the turnaround pays off. jcpenney stock soars after assets jump in the first quarter. the retailer returning to its no frills roots. and we're whale watching major investors sell out at gm, david einhorn getting rid of his entire fund in the maker. warren buffett placing his bets on walmart according to the latest s.e.c. filings.

portugal now the second eurozone country to exit its bailout and the prime minister told us that the path of reforms won't stop here. don't forget, these three years were very, very tough. no one wants to spoil the sacrifices we have made. >> announcer: you're watching "worldwide exchange." bringing you business news from around the globe. we've had two days of -- yesterday the worst day in the month for the s&p and dow. futures indicating this morning, don't though what we want to do. the dow is just at the moment on fair value really. as is the s&p 500 as is the nasdaq about half a point up. so not much direction coming from futures, not much direction coming from european equities either which are now around 2 1/2 hours into the trading session.

ftse is off search points down 37 points yesterday. xetra dax off 0.1% and flat for the cac quarante and ftse mib is up 0.5%. ten-year yield yielding 2.51%. so with people saying we've got markets close to record highs as we were a couple of days ago and others calling for a crash, what are you supposed to do? here are some views of some of the experts we've had on the channel this morning. >> the probability of reaction is lower so this will support the euro. 'euro -- it would show increases so this in a way puts this on the euro. in this environment euro dollar because of what is going on will likely remain at that range bound. >> the indian market is selling off heavily as we begin to talk

about tapering and the currency came under enormous pressure. now things seem completely different as i say, i think you have to get delivery and think the china/india trade looks a crowded one and crowded trades always dangerous ones to come into it at a late point. >> we have 12 countries where we are active and sure. not all sure but gem sure but don't see a market as competitive as uk one. quite competitive but not comparable with the uk, indeed with the rates going up, down with the frequency we indeed don't recognize elsewhere. >> well, those are some thoughts we've already had and hindu nationalist bjp party led by moe modi looks like it's headed for a resounding victory in the indian elections. the party and its allies won

over 300 seats which gives them a coffee-mate margin for the 242 needed for a simple majority. the ruling congress party has been taking a beating barely managing 60 seats, it is said, over $16 billion has been poured into indian bonds an stocks over the last six months and indian shares up fresh record highs. the market on the low for the session up a percent up around 4% first thing when those initial results came in but we have been hitting successive record highs in anticipation of this result. now, also time to go whale watching. america's biggest fund managers have revealed their latest buys and sells in the first quarter s.e.c. filings. figures show big investors reacting to the huge recalls by general motors. neal cooperman and david einhorn completely dissolved their stakes and warren buffett's company took a new $11 million stake in verizon or 11-million

share and while adding to his stake to walmart and liberty global. barry rosenstein partners took a new share in ebay in the first quarter. 8:30 april housing starts. poor housing data part of the sell-off yesterday so investors will watch this closely and 9:55 a.m. we'll get an early look at may sentiment. as we look at those numbers apparently the economists of tomorrow aren't that happy either. the new revolution is taking place amongst economic students in britain and elsewhere in the world as they complain that the cost is their taking. fail to explain the 2008 market crash as a result, our next guest says we need a revolution in the way we teach economics. joining us is harjun chang from the university of cambridge. thanks for joining us. bear in mind the fed has talked about, we're look at u.s. housing to see whether there's a

pause in growth and housing was at the epicenter of the financial crash. is it fair to say we don't -- we still really don't understand the cause of economics have not sufficiently explained what happened in 2000. >> yes, i think there's one important reason why the students are demanding reform in the way economics is taught. not just go back seven, eight years and look at what top economies have said about the great motivation, the end improvement bars and the market being rational despite the fact -- >> saying it was the end of boom and bust. >> exactly -- i mean, he was supported by economists that he said, you know, a look at the famous chicago economy in 2003 proudly declared that now we know how to manage recession. that we don't need to have recession from now on. you know, 2006, at the height of

u.s. housing bubble, ben bernanke, former chairman of the fed and professor of economics at princeton said that house price are rising 20% in one year was a reflection of the fundamental and, you know, i mean -- >> yeah. on and on so why have we -- first of all, there are no absolutes in economics. >> of course. >> and it is clearly not that much of a science. is that fair to say? i mean, it's -- >> yeah. >> is it more an art -- go back to the old discussion. >> absolutely. the difficulty with economics compared to, say physics or chemistry is that first of all it deals with human beings who have free will. you know, they don't act in the way that particles and chemical compounds behave and also that all economic theories have political and even ethical assumptions, so if you don't

agree those assumptions however the theory might look on paper that that theory is meaningless. >> as you said -- i've always looked when i first started -- studied economics at school, i love the bit that is were practical and the theory bit turned me off completely. enormous snob. i couldn't see actually where that worked in the real world. only interested in what works in the real world. need to get an awful lot more practical and empirical. >> absolutely. exactly how i see it because, you know, we've been teaching students and also the general public economics the wrong way because people are interested in economics mainly because they want to understand why -- >> it's not about my job but money i earn and cost of my food, my bills and that's real world economics. >> exactly so that you need to bring people into economics through that and then explain why, you know -- you need certain theories. >> if you look at central

bankers right now around the world, who do you think, you know, who do you think has got the most practical sort of head-on in terms -- this is important. the central bank is actually, you know, not wedded to any theory, they don't come from any particular school of thought. my thought -- who do you think has got it most right? >> well, i think in fact you have to kind of look at janet yellen who interestingly is a professor of economics but has a pragmatic attitude so i think she made that successful transition because in some countries you point to former economic professor as a central banker and he wants to run the economy as if he's teaching his student and it doesn't work. so in that i think actually it stands out. >> you give her a thumbs up. good to talk to you. i like an economics man that comes in and says we're doing it all wrong. >> this is why i wrote this new

book called "economics, the users' guide" which tries to introduce our readers to the real world. >> it's a good job. thank you very much for coming in. ha-joon chang. he's trying to reeducate the way economics is tog. i think that's a good thing. son-in-law of the other stories we're looking at today, the fcc had a new vote for preliminary rules and allow internet providers charge content sites more money in exchange for faster and more reliable service by creating a fast lane. those in opposition to the rues say that small start-ups will not be able to compete with bigger companies like large companies like netflix. the fcc vote was 3-2 and will now move forward to public comment before final approval. chipotle investors overvoted an

option. 75% overvoted over it paying $50 million to the two ceos and marked the 15th time shareholders have voted against a pay plan so far this year. important to know chipotle is not required to listen to the message from shareholders but one thing they ought to think long and hard. still to come on the show, jcpenney beats the street in the first quarter and shares are soaring. we'll have all the details next.

recap of the headlines. indian stocks jump as opposition leader moe modi wins the election with a clear-cut majority. jcp shares soar after-hours as first quarter numbers beat the street. and s.e.c. filings show major investors sold out of their positions in gm in the first quarter. now, portugal is on the path to growth. this is the verdict of the country's prime minister speaking exclusively to cnbc as the country prepares to exit its 78 billion euro program this weekend. julia is in lisbon and speaking to the prime minister and joins us for a little bit more.

julia, the question is, once you exit there will be those who say we need a handout or some help now that -- can we free up the reins of austerity but i wonder whether there will be any room to do that for quite some time. >> well, ross, you're right. naturally the prime minister insisted to me that as far as things are going right now, there's going to be no let-up on the reforms will continue and when i talked to him about the ending of this program he said it's been three years of sacrifice that they finally regained the trust of the market and they're on a path to growth. no real sense of celebration. yes, a lot of work done. it is a milestone, quite frankly and they've put it behind them but there's a new problem now, remember, because those austerity measures and reforms as you quite rightly said have to continue here and now they've got no troika to blame if things are tough or things go wrong. then, of course, the government here also has to face the public

vote. we've got elections. we've got european elections next week and then we've got the general elections next year too so it's going to be a combination of balancing further austerity with the pressure, the public pull on them and resenting them for doing so. so, yes, huge step forward in this program, but at the same time this story very much unfinished at this stage, ross. back to you. >> jules, thanks very much for that. plenty more online of that interview on cnbc.com. jcpenney shares soared. morning, jackie. the stock this morning in frankfurt doing very well. >> good morning to you, ross. that's right. jcpenney beating estimates with a loss of $1.16 for share on $2.8 billion in sales. now, that's better than expected $1.25 share and 2.17 billion in revenue. the company said a strong easter

holiday period enabled the better then expected results. they also focused more on low-cost brands and scaled back on some of the trendier brands that former ceo ron johnson had hoped would bring in new customers. online sales strong growing 25% in the first quarter. they gave a bit of insight into this current quarter saying it expects comparable store sales to go in the mid single ding it? range. in a bit of a change of heart the company said there is no longer a succession to replace their ceo. previously they had been looking to replace him. allman rejoined after johnson failed to attract higher end consumers. yesterday's strong earnings report sent jcpenney's stock soaring as much as 18% in after-hours trading and song up significantly from its recent lows in february. they're still down from its past highs. this all comes after walmart's big earnings miss earlier which was attributed largely to severe

winter weather. ross, still blaming everything on the weather. >> oh, yes. nice day today in london, by the way. no complaints here. >> hoping to have a nice weekend. >> good. so are we. let's all raise a glass to that. so jcpenney beating estimates that loss of 1.16 a share on sales. now, other things we're focusing on today as well besides the jcpenney numbers this morning, credit suisse reportedly poised to enter into a guilty plea with the u.s. justice department and could deal a it.5 billion blow to the swiss lender which is accused of aiding american tax dodgers. it's still unclear whether u.s. regulators are considering revoking the bank's operating license. the guilty plea could be announced as early as next week. deutsche bank, you have been warned. the lender sent out an internal video saying boasting vulgar

comments are not okay. particularly directed at the traders colin fa. n, co-head of deutch's investment bank appears in the video and says reputation is everything. and that some staff are falling way short of our established standards. we'll see whether that takes on with other investment banks. he may be nervous point markets but that hasn't stopped david tepper by buying big tech names. we'll find out which ones next. [ male announcer ] some come here to build something smarter. ♪ some come here to build something stronger. others come to build something faster... something safer... something greener. something the whole world can share. people come to boeing to do many different things. but it's always about the very thing we do best.

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u.s. futures not giving us much direction this morning and the european markets haven't either. just dipped down as you can see probably the weakest part of the session, ftse off 0.2% and xetra

dax up 0.26%. meanwhile, time to go whale watching. america's biggest fund managers have been revealing their latest buys and sells. for the first quarter with the s.e.c. filings, and figures show big investors have been reacting to the huge recalls from general motors. leon cooperman and david einhorn completely dissolved their stakes but berkshire hathaway took a new 11-million stake in verizon and added to walmart and liberty global. even david tepper was buying in the first quarter just days after the top fund manager said he was nervous about the market. his latest s.e.c. filing shows he has been buying up stocks. so on his shopping list he added google class a and added brand-new positions in facebook, expedia and priceline. we don't quite know the exact date of those purchases, though. also staying in tech, taxi

app uber is seeking another round of fund raising that would value them at $10 billion. that's nearly three times what it was valued at last year. a $10 billion it would be worth more than staples and best buy and raises concerns we are still in a tech bubble for valuations. other start-ups like dropbox crossed the $10 billion threshold. as i mentioned u.s. futures just dipping down a little bit as we go through here. not by much. essentially still flat. the dow ten points below fair value. the nasdaq about a point below. on the agenda today, stateside, 8:30 a.m. april housing starts. poor housing data part of the u.s. sell-off yesterday so we should be giving this number some attention today and at 9:55 a.m. we'll get an early look at may consumer sentiment. how is it going to play out. ted horowitz is founder of

average joe options and joins me from the trading floor. joe, good to see you this morning. right, so for the dow and s&p yesterday, what was behind that move? >> good morning, ross. i think, you know, we needed a little bit of profit-taking. you know, it kind of started wednesday with a very light sell-off because the volatility and buy-in weren't there. thursday, yesterday, we had more buy-in and more volatility but still looking more like profit-taking. we are at the upper end of our range and put in a new high. a little bit of natural sell something no big deal right here yet. >> no big deal here. ralph acampora saying he has a sick feeling a big crash is coming. do you have any of that? >> well, i have been bearish quite a while and seller of the top level and think we're in a bubble and do think we'll have a

sell-off. my target still is 15.60 in the s&p before year's end so i do see a 15% to 20% sell-off from up here but, again, a crash, i don't know if we'll see a crash but do expect selling and do expect to see some pressure. you know, the fed can only carry the weight so far, the printing money, printing money, printing more money devalue your currency, no gdp or jobs can only go so far before we have to see some real selling? >> that's going to stop printing money. what's it with yields though below 2.5%. 30-year yields down at three 11-month lows. did we get a short squeeze here, todd? >> i think we had a little bit of an arbitrage, ross. we had some money coming out of stocks going to bonds. you know, david tepper said he was a little bearish, the market, have a little flight to quality. you always have the money move

around and i think we've seen for the last couple of months a lot of the money has been coming out of the higher risk and moving into some of the more safety stocks and now i think we saw another shift into some of the bond market here, you know, even though yields are so low they're considered safer investments so i think it was a flight to safety or quality in preparation that there may be some more selling pressure on the way. >> todd, we have people, bullish people bearish like you. it could be maybe all we do this year is just essentially keep going flat. we do what we've done in the four months for the entire year, nothing much happens. >> you know, we are really flat but take a look at the nasdaq and the russell. the nasdaq at its lowest point was down about 10% on the year. the russell was down over 10% on the year. you know, when we look at it, those are the real indexes that really lead the market one way or the other. if those are going to be weak we'll have some real problems. >> todd, have a good day. good weekend when it starts. good to see you that is it from

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good morning, welcome to "squawk box." investors getting quite concerned with economic concern, eurozone worries, but so far the follow-up is relatively flat and the results of the world's largest election and india will have a new prime minister. and warren buffett makes a big call on a giant and "squawk box" begins right now. >> good morning, welcome to "squawk box" on cnbc. i'm andrew ross sorkin. i'm here with joe kernen. becky is out.

we have some more data on the markets to chew on. april housing starts report. that's going to be released at 8:30 a.m. eastern time and economists expect a rise of 4% to 984,000 this. could provide more evidence on the strength. later in the morning we'll get an update on consumer sentiment. earnings report will start to heat up again next week. after the bell less than positive reports. check out shares of jcpenney. the troublinged retailer moving higher after reporting a lower than expect loss, $1.16 as well as sales that topped estimates. penney expects same-store sales to rise in the midsingle digits. nordstrom reported earnings of 72 cents a share on revenue of $2.84 billion. both of those numbers topping analysts' estimates. joe, over to you. >> yeah, we're back. funny you ask me anything going on.