welcome everyone to worldwide exchange. >> these are headlines from around the world. >> we'll start with weather because that is the big story. millions of americans in the northeast u.s. are hunkering down today as a major winter storm sweeps through the region shutting down roads and forcing thousands of flights to be cancelled. >> russian stocks and the rouble bounce back despite s&p downgrading it to junk. the country's finance minister accuses the ratings agency of failing to take it's anti-crisis plan into account.

>> and the fall in oil weighing on siemens earnings but the ceo expects benefits from cheaper cool. >> emerging economies in india will massively benefit with a much lesser oil price bill and that will go straight to the infrastructure build up. >> and facebook and a number of other social media sites suffer a global outage with hacking group lizard squad claiming credit for the attack. >> you're watching worldwide exchange. bringing you business news from around the globe. >> blizzard conditions shutdown new york city and much of the u.s. effecting millions of americans but it may not live up to the hype as one of the worst ever.

forecasters said it could dump 1 to 3 feet of snow from new york to boston but now downgraded the totals. still high winds prompted several days to ban cars on the road and halt public transit. more than 4500 flights are cancelled today but it's business as usual for the markets. you know, when we talk about the impact that this will have on new york city, this is new york city. the financial hub of not only the u.s. but arguably of the world but in terms of trading impact, one investor writes that market liquidity could dry up a bit because investors and bankers not sitting at their desk. they're watching the markets from home. >> even if the storm isn't as big as some expected, people are still staying inside and watching netflix and posting on instagram and facebook which is so interesting that we're now seeing the outages. >> in previous storms we have seen consumers go online to take

care of entertainment needs or perhaps watching the news more because they're at home and many stores and restaurants are closed so consumers have limited options on what to do. >> i saw you post a picture on instagram before the outage. >> typically i'm in new york city covering these storms. but luckily i'm here in london viewing it from here. we'll be tracking the storm 24/7 here on cnbc. we want to ask you tuning in from the northeast how will you be spending the day? also we want to see your blizzard pictures. we have been getting your tweets. ivan already tweeted us from washington with this picture. stay safe. you can see a lot of cars with a lot of ice and snow. and adam sent this picture in. let's take a look snowy new york. >> those were just some live shots we saw as well of new york city. it's the middle of the night

there and we're seeing the storm barrel down. now i want to bring some alerts to our viewers. the swiss franc has fallen over 2% to the euro to .069 a year. the floor was 0.1280. it took away the floor earlier this month and now saying they would intervene to weaken the currency if necessary and traders are speculating they are indeed doing so already. >> yeah we've seen a lot of volatility over the past couple of weeks and once we got the unexpected decision to scrap the national currency cap of 120. it broke during worldwide exchange, we saw it strengthen against the u.s. dollar and euro

by 14%. but here a turn around. >> probably some relief for those exporters wondering how they were going to deal with that sudden strength. >> european policy makers continue to send out warnings that athens will not receive a debt hair cut. this comes as the new prime minister prepares to name key posts within his cabinet with antibailout commentator expected to be the finance minister. annette, let's start with you, we knew this would be a game of chicken and both sides are staking their positions already. >> reporter: it's just the beginning of the game of chicken i have to say. it will probably roll out during the whole of february until the end of february when the bailout officially ends for greece. greece of course wants to have a hair cut. euro zone enders which are also the creditors to the nation

including the ecb don't want to have a hair cut on the existing debt. they actually could think about is debt restructuring when it comes to duration or longer duration for loans, lower interest rate but also when it comes to this kind of debt restructuring, here in brussels people are saying there's not a lot of room for improvement looking at what greece is already paying in terms of average interest rates there right now at 2.4% according to calculations from the german finance ministry. when it comes to the security or the debt average profile maturity it's longer than euro zone states. it's not the great deal they could do when it comes to longer duration or long erma tourty of the debt.

yesterday i also caught up the head of the euro zone finance nance minister group and talked about his take on greece and where does he stand? >> greece will have to face the same struggle dealing with the economy, putting the government institutions right. making them more effective. opening up the economy. getting investors back in. all the issues that were relevant before the weekend are still relevant now. >> a new government can take a new approach to these problems. but problems in essence haven't changed. >> could it be easier for the new government because it has such a massive support to the population? >> i don't know. these are difficult problems. they will not go away in a short time. they had sometimes stake tough measures also from new governments but their approach may be different so we'll talk how they will want to address these problems within the boundaries of what we have agreed within the euro zone and those are for me the limits.

>> reporter: so euro zone finance ministers and leaders are waiting for the new greek government to come to them or voice their demands because currently they don't really know what they really want. of course the biggest threat here is end of february perhaps no bailout package anymore for greece and also greek's banks without liquidity. with that i'm sending it to julia and asking what's the talk there. >> thank you. as you quite rightly said the leverage is the situation, the clock ticking as far as greece is concerned. be it pressure on the banks. what we have seen in the last 24 hours is lightning speed changes as far as the government is concerned. we have this together now with the right party. the independent greeks. the leader says he's a

regulator. but these two collectively seem like a very defiant force. significant push back. we're expecting to see a coalition agreed today. the finance minister here. he said all along the debt in this country is a strangle hold as far as the economy is concerned. if you remember in history the greeks were told if they got to a primary budget surplus some further debt negotiations were possible. it's interesting in pain they're suggesting there's a secret deal being talked about that could see greece not paying back debt until 2057. there's not necessarily talk about that here but it's interesting that what could happen here is being talked about far more broadly than greece. that's a key point when europe attacked the situation here but as far as the level of defiance is concerned we're hearing talk that the first policies will be

increasing minimum wage. bringing back collective age bargainings. so certainly initial signs of defiance here. europe has as far as the clock ticking on the financial situation in greece. we have to wait and see what the talks bring. >> crucial few weeks. absolutely. we're learning eunice is confirmed the finance prime minister of greece. we are getting more news on other figures and other leadership figures coming into place. also want to update you on the story out of russia and ukraine following further violence out of eastern ukraine. e.u. heads of state are asking them to consider further actions including further restrictive

ones toward russia. the heads of government say that russia has responsibility for the violence in eastern ukraine and they note evidence of continued growing russia support for ukraine rebels. of course this following further violence in eastern ukraine over the past one week -- over the past weekend i should say. the big concern is the threat of further sanctions on russia and what that impact will be on russia's economy. we have already been seeing the index a trade under perform. the russian rouble strengthening slightly against the u.s. dollar. let's talk more about the impact of russia on equities today. jerry it was interesting, you would think maybe the russia story was a 2014 story. but clearly it's dominating investor discussion in 2015.

>> that's true. it's been highlighted as a risk investors see through 2015. naturally there's two sides to the story and these are pressures that slowly build over time. so it is something that is in investors minds for sure. >> you now caution for the european fragmentation. one strategy is to try to create political tension by offering bailouts to peripheral countries. a lot of the economic impact happened barring more significant sanctions which would be a big step forward. >> there's the sectors that stand to be negatively ill pacted the most given the downturn in russia. is it some of the banks that have significant exposure to russia? >> yeah a lot of that has been factored in. there's certain companies that have a larger number of exports

going to russia so it's still a small fraction of exports. it still has minimal relevance. it's worth also baring in mind that russia probably will find support from some of its friends. china discussed a swap still. there will be an opportunity for stabilization and emerging assets at some point. >> there could be an opportunity here. >> eventually. >> okay but russia just downgraded to junk level for the first time in ten years. still investment grade until more downgrades. but it would have to be taken out of most investment day indexes. that seems imminent to me. >> i haven't been following that use ever news in particularly closely. you can speak more on that. >> tell us more about the opportunities. >> just that you know you've got 17% interest rates in russia and a currency now much weaker

than it was when there's solvency report that comes in for like the chinese. it's not time because of the uncertainty and deescalation. >> we'll be discussing more about europe and the opportunity when it comes to european earnings which are expected to be helped or boosted by the weakening euro. >> all right. let's now get to our market update. we'll head out to the heat map and see where stocks are trading in terms of winners and losers. stoxx europe 600 index flat down about .3%. last week we did see the stoxx europe 600 index trade at a 7-year high on the back of the ecb announcement of further monetary easing. a big part of the move is in the ftse 100 and xetra dax.

helping out perform in yesterday's trade. right now trading lower perhaps on the back of the news out of russia being downgraded to junk status given that russia has a strong trading relationship with germany. cac 40 a loss of around .50% and it's trading lower ahead of the gdp number. the micex index seeing a little rebound in today's trade after what was a significant move to the down side given the threat of further western sanctions on russia. right now trading at 1,658. up about 1%. currencies have been a major focal point for investors given the move we've been seeing against the u.s. dollar. it's strengthening at 11323. still trading down 8% so far this year against the u.s. dollar. oil, where is that trading?

yesterday we did see crude oil drop another .1% but it did manage to hold on to the $45 level. still the lowest level since march 2009. a mixed trade though wti crude at $45.16 and brent crude trading at $48 barrel. given the flight in safety over the last couple of weeks into equities spot gold trading at $1,281 an ounce. coming up we will continue to bring you the latest on the storm causing travel chaos and shutting down many parts of the u.s. northeast. stay tuned.

welcome back. let's take a look at some of the stocks trading lower today. siemens shares. net profit fell by 25% in the first quarter. this amid declining oil prices and challenging european economy. joe kaiser said he saw the pros and cons of cheaper gas. >> is there is a disadvantage in

one industry there could be a bigger advantage in other areas of the industry. so certainty will boost the sentiment with lower gas prices. we do believe this will give a very positive impact into the industry. you also believe all the oil importing countries such as emerging economies in india will massively benefit with a much lesser oil price bill and that will go into the infrastructure build up in those countries. we believe there's a lot of opportunity also coming from a low oil price. >> meanwhile novartis is in the green by nearly 2%. this after the swiss drug maker struck an optimistic tone for 2015 as fourth quarter sales came in ahead of forecasts. we spoke to the ceo earlier about the prospect for job cuts given the snb's shock. >> the action by the swiss

national bank was fairly dramatic. we saw a very fast appreciation of the swiss franc. we're looking at the swiss cost space today but not just the swiss cost space. we're looking at our cost space across the entire globe. >> meanwhile, phillips shares are trading sharply lower by nearly 4% after they cut sales and profit targets and revised restructuring costs upwards 400 million euros. meanwhile easyjet here in the u.k. up nearly 4% after the budget carrier said revenue looks to strengthen in the first six months thanks to lower fuel costs. the london listed airline expects losses in the first half of 10 to 30 million pounds. this is a significant improvement in the losses made in the same period last year. >> thank you. you're still with us to talk about what to expect going forward in 2015.

some of the big winners in the oil trade are the airlines and transportation services names benefitting from lower oil prices. do you forsee that trend going forward? >> there's a lot of big winners going down. money isn't being destroyed here. it's just being transferred to the winners being everybody that uses oil which is a much larger sway to the population. it's most important in the u.s. where it's a more consumer driven economy than elsewhere and also where the oil price has been more significant. every time we downgrade deflation forecasts we're upgrading forecasts in the u.s. dramatically. in the europe it's the same story but not quite the same because it's a less extreme balance than in the u.s. >> let's talk about the euro. many analysts are now expecting a boost to european core earnings. a 10% rise in european core

earnings in 2015. much of that having to do with the weaker euro. what are you forecasting? >> it could be more than that. we have a model that suggests about 12%. we took consensus estimates and we tweaked the revenue line globally. so when you look at what they're forecasting for rates what that tells us is the consensus expectations might well be too low and actually the currency forecasts will need it even more. >> the case is growing for european equities over u.s. equities but what's the risk of that in your head? >> well the risks are crisis risks now because the qe that the ecb has announced is quite different to other programs. mainly because other programs created real interest rates while nominal interest rates

were positive. you have negative nominal interest rates because of the negative deposit rate. euros are a hot potato. not only is there a real cost but a absolute cost to holding euros. so people are going to be trying to pass these new euros among themselves as quickly as possible. that will involve selling to a foreigner. the euro is likely to go down. there's event risk around the currency depreciation itself however that creates a tail wind in asset prices. if you have a lack of financial product being issued that people can buy and a trillion euros being printed and put into the system, a trillion euros needs four or five trillion of investment through the banking system. you can't create that in 18 months. it will end up pushing prices up. >> that was a great point. you wonder if investors are overly optimistic about whether european stocks will out perform in 2015 and if that ecb plan of monetary easing will be enough

to revive the euro zone. >> it will be very very difficult for european asset prices not to go up with qe that is being implemented. perhaps the risk and why we're not seeing the reaction in places like the equity market we might have expected is fear that the ecb can't achieve their policy because if there's only 180 million euros of net supply of european bonds next year and they're trying to buy a trillion depending on how they split it they have to buy off existing holders but they aren't going to be motivated to sell. how can they get their hands on these financial assets. >> you had such a good point about asset bubbles. is that not what we're seeing in japan? they had a huge stimulus program. we've seen the markets increase by a huge amount yet we're not seeing wage growth increase. we're not seeing the economy which has fallen into a recession. do you think that's likely to happen in europe? you say that it is a much different program now. >> the goal of qe is to suppress

yields so it's less appetizing to save and more appetizing to invest. now in europe there may be an opportunity for that even though there's a very large gap for that. it's the ecb survey on loan demand which jumped 18% in the last three months. there's demand for loans in europe. they're going to be charged 2 million euros and they'll be highly motivated even if it means easing their lending criteria. if you make a loan to a small business at 2 or 3% it's still 2.2 to 3.2% better than holding that as cash. >> the health of the banking system and the fact that we haven't been seeing loan growth or lending in general. perhaps that picture will change. we'll leave it there. thank you for your time. >> well still to come on the show cooling but still impressive? that's how they're forecasting uk 4th quarter gdp to come in.

we break the numbers right after this break.

millions of americans in the northeast are hunkering down as a major winter storm sweeps through the region shutting down

roads and forcing thousands of flights to be cancelled. >> european leaders put the blame on moscow for growing violence in yeern ukraine asking foreign ministers to consider further sanctions. russian stocks and the rouble bounce back despite s&p downgrading it to junk. >> european stocks fall but ceo expects benefits from cheaper fuel. >> economies in india will massively benefit with a much lesser bill and that will go into the infrastructure build up. >> facebook and a number of other social media sites suffer a global outage with hacking group lizard squad claiming credit for the attack. >> and we're just getting the first read on u.k. gdp.

the fastest annual growth since 2007 last year despite a bigger than expected slow down in the final months of 2014. gdp grew by 2.6% in 2014. also we're hooking at that's up from 1.7% in 2013. while more countries have not yet reported 2014 growth data it's ahead of the imf estimates. you can take a look up 2.7% year over year versus the 2.6% year over year. sterling trading -- we're seeing a little volatility in the sterling trade right now at 1.5071. we're seeing weakness in the construction and industrial sectors and also if lower oil prices had been a boom for the economy as they have been for the u.s. >> absolutely. let's bring in our u.k. business

editor. let's get to you first. what's your initial reaction? we're seeing volatility in the sterling dollar but, you know this is in line with forecasts. >> of course the expectation was 0.6%. that would have given you the 2.6% growth. it's very strong growth. the question is the last that we had was 0.7% for that third quarter hasn't slowed and what does that mean for 2015 when we know our main trading partner the euro zone is struggling and we're seeing that come through. the one thing to remember though is we have had a pick up in discretionary spending. we haven't had any of the benefits yet from the tumbling oil price which we probably won't get until q-1 this year. so the uk outlook is still quite positive. >> on that point when do you expect to ceeloer oil prices feed through to the economy? >> well to some extent they're beginning to feed through.

we saw retail spending in november and december last year was very firm and one of the arguments for that was actually households are benefitting from the improvements in their real economies. but given how far oil prices will fall and petro price versus fallen ian gattis pate it will come through over the next few months. >> we had this which is a major energy provider in the u.k. saying your average bill will be cut by 28 quid. that's not a lot. unlike the u.s. where consumers basically immediately feel the effect because taxation is so much lower. here it takes a little bit of time but if you look at the research from accountants that are saying discretionary spending, we know retail sales quite high. but discretion spending has really gone up hugely over the past few months and oil price dropping can only help.

>> bigger discussion is around what this means for inflation. mpc trading from 9-0 to 7-2. it's way too low to raise interest rates. >> they would have told you the mpc are maybe not giving enough credence to that. >> our inflation target which is 2% and by the way they always get it wrong, is a two year horizon and you need to look through these factors because they're driven by external issues and the issues in the u.k. like wage inflation for example. we've actually seen that pick up for the first time. very important. >> that's a very important point. the inflation outlook is highly uncertain in the united kingdom. there's two key things important in this debate. number one is what is the second round effects of the cuts in energy prices. to what extend do manufacturers

and companies pass on these energy price improvements to the prices of other goods and services? is that happens inflation could fall sharply. second point is you make wage inflation. we're seeing wage inflation starting to pick up. the labor market has proved remarkably resilient. we have employment at a record level and the fear there is while headline inflation might be dropping because energy prices are coming down the rise in wage inflation could also ultimately mean it picks up. >> we have wage inflation but 1.8% is not like the 4% that we were seeing before the crisis and the drop in oil prices the theory goes it should help manufacturing. help rebalance the economy which as we know 1 hyundais to the election in the u.k. is all about that promise. we have the economy working and we have rebalanced it. have they? we're not clear. >> it's interesting to see the

diver divergance going forward. the u.s. is still expected to raise rates this year. uk says they're going to hold it off until perhaps next year. >> that's important because both the united kingdom and united states were the first central banks to undertake quantitative easing and there's a question of whether it's contributed to the economic recovery. that's the optimistic view for the european central bank and europe. >> we're going to leave it there. adam chester, our u.k. business editor, thank you so much for joining us here in studio. we want to get you some headlines coming out of greece because we are look at a significant move in the greek banking sector. the greek banking index falling by 9.7% hitting a record low. take a look at the greek banks underperforming.

eurobank down about 13%. so it's weighing on some of the banks and another day of losses for those names. >> let's get a check and see how the major crosses are doing. no we're looking at the broader equity markets. we'll take a quick look at these. the markets under some pressure. the xetra dax down about .5%. but the ftse mib is the underperformer. not a lot of movement. and the ftse 100, after the gdp read it did come in with expectations but we're still seeing the ftse underwater by .2%. but we're just highlighting there are still concerns it's not a done deal yet. let's talk about a corporate story. toyota is making big changes so it's pay system putting greater emphasis on performance rather than seniority.

we have the story live from tokyo. >> hey there, toyota will revise it's seniority based wage system for factory workers. it has decided to to this in order to attract younger work force. it's difficult for companies to hire younger people in japan because of the decreasing birth rate and aging population. with this new pay structure employees will be evaluated twice a year on performance on the factory floor and team work. wages will be adjusted accordingly every six months. toyota plans to erase salary gaps by providing greater benefits. the new wage system will apply to about 40,000 employees 18 to 65 which is about 60% of the company's workers. the car maker hopes to introduce it next january. current wage systems for japanese factory workers are based on seniority so toyota's

efforts may prompt other japanese companies to change their rate systems as well. in the meantime japan's economy minister mentioned today that it will take more than two years for the bank of japan to achieve it's 2% inflation target. he said continuing drop in oil prices will effect overall consumer prices. the government is pressuring japanese companies to boost wages in hopes of raising consumer prices to reviving the economy. back to you. >> thank you. it's interesting that you're finally seeing some wage changes take hold in japan. that's what a lot of the ordinary citizens were waiting for but hopefully you're starting to see it at the ground level. >> millions of people were unable to update their status or post photos online today as facebook and instagram appeared to suffer a widespread outage. early this month facebook said sorry something went wrong. users were unable to log on to

the website via pcs or mobile apps but service has been restored. a twitter account linked to lizard squad is claiming responsibility but facebook blamed a system change for the outage. we were trying to log in about an hour ago and we couldn't. since then service has been restored but interesting enough this not coming at a great time when you have a lot of individuals at home in the northeast with limited options on what to do and wanting to go online, social media. >> can you imagine if netflix had an outage right now? i couldn't put it past it. the site could just crash. what is there better to do than watch tv or netflix when you're sitting at home. >> you have to binge watch. do you have a favorite series? >> i'm more of an hbo game of thrones fan. like our friend sri in

singapore. he brings it up all the time. >> he's proud of it. >> what about you. >> house of cards. my favorite. the inner workings of washington. what a fantastic drama. >> absolutely. >> let's talk more about tech because microsoft second quarter profit fell more than 10% as sluggish pc sales heard demand for window's software and the company struggled with the impact of the stronger dollar. microsoft gets 75% of its sales from outside the u.s. although much of that is in dollars. revenue rose 8% largely due to the nokia acquisitions. they expect to cut revenue growth by 4% this quarter. shares fell by about 4% in after hour's trade once we got the report from microsoft. right now shares trading down by 3.2% in frankford. >> it is of course the biggest week of the year for u.s. earnings. microsoft got the ball rolling after the close on monday meeting forecasts despite weak

pc sales. yahoo! and apple all report today. big heavyweights on the agenda. tech news comes on wednesday with facebook out after the bell but we also hear from boeing and chrysler. >> on thursday ford google and amazon. they take their turn in the tech spotlight and finally we hear from chevron, mastercard xerox and matel on friday. >> the big conversation is how is the stronger dollar impacting the multinationals and we'll be discussing that on worldwide exchange. still to come, eu leaders put the blame on moscow for flair ups. are more sanctions on the way? we'll discuss that after this break. can data help cure a disease? the right treatment for you is out there.

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welcome back. european leaders urged moscow to condemn the actions of separatists in eastern ukraine. we also called on foreign ministers to consider further action against russia including additional sanctions. >> meanwhile the russian rouble firmed against the u.s. dollar after yesterday's slump as they sell their foreign currency. s&p downgraded it to junk in the first time in over a decade. earlier we spoke to the director and he said the outlook for russia's economy looks bleak. >> we have revised lower our long-term growth expectations to around .4% over the next four or five years and we think it's going to contract this year.

that's going to impact public finances and the banks. the banks could hit the fiscal situation for russia. >> we're now joined by the head of cemea fx and rate strategy at citi. thanks for being with us. we were talking to a previous guest earlier today about how you could eventually see opportunity coming out of what's going on in russia particularly if the chinese throw them more of a lifeline when we're already beginning to see. would you agree with that? when should you be looking at that opportunity? >> to be honest given the latest developments i believe that the marchand june checkpoints that's when the council will decide and the rollover or the roll off of the sanctions. i do believe that unfortunately now the outcome is a little bit more skewed toward a negative output which will be the decision to rollover the sanctions and keep the pressure

on. and on top of that we have on the local side inflation dynamics. we know given the effects it will fluctuate higher toward 15 or 16%. that's our forecast. it becomes very difficult to be positive in russia still. >> the markets seem to be taking that s&p downgrade some what in stride. we are seeing the rouble firm against the u.s. dollar. what happens if they decide to downgrade russia's credit rating to junk status as well? is that going to prolong the pain? >> absolutely. that will be another boost. a negative boost definitely on the spread we have to take this with a pinch of salt. we know it's been highly telegraphed so russia has been on a negative outlook for quite

sometime. let's be honest with russia at 600 basis points that's where we are more or less now. this is already telling you that the market implies a russian rating much lower than bb plus. so eventually around the single b plus level so there's already a lot of dislocation in advance to any further rating downgrade. >> we're seeing a little strengthening in the russian rouble right now. this currency lost about 40% over the past year. if you have been caught on the wrong side of this trade what would you recommend those clients do? >> we are still negative russian local bonds. we actually are funding we don't

believe that the bounce back will happen soon. i think that might eventually happen in the second half of the year when the inflation might turn down a little bit. none now. we are still supposed to peak around the second quarter of the year. it's difficult to be positive russian bonds at this stage. >> unlikely scenario given the decline in oil prices? that 50% of the revenue comes from oil services. >> absolutely. if you turn down to the assumption they're writing the report. so they're using $70 barrel oil assumption for 2015. they're going through a massive deceleration. so you can imagine if we stay at below $50 barrel in terms of levels that can be another

negative catalyst here for the russian economy. the economic situation will actually get worse before it has the opportunity to rebound in the second half of the year. >> okay. and how do you think this is going to strikel through to europe? seema was pointing out we did see germany and russia with the trading relationship taking a hit because of the latest downgrade. if russia's credit rate as good downgraded by another agency it would be ineligible for investment rated indexes. what's going to happen for the rest of europe? >> you pointed out an important variable here we're all monitoring. this is -- most of the credit players and investors they have the two out of three rule. so if russia is downgraded to junk by two agencies out of three agencies then they have to release the holdings. they don't hold russian debt anymore. we only have one rating out of three ratings in junk status.

so we are not there yet but there's pressure and i do believe that could be some level of follow up here when it comes to downgraded the credit further. >> you said it might get worse before it gets before. head of fx and rate strategy at citi, thank you for your time. sticking with the russia story, u.s. prosecutors arrested a russian banker in new york charging him and two others with spying for moscow. the fbi says they were seeking information on a number of topics including the new york stock exchange. u.s. energy resources and sanctions in russia. the man also allegedly tried to learn about high speed trading in order to rock the u.s. markets markets. the banker is denied bail. the other men are protected by diplomatic immunity. >> 30 top u.s. officials will arrive in saudi arabia today as part of a delegation sent to pay

tribute to late king abdullah. they'll meet as tensions continue to rise. meanwhile the ceo of state oil company says the oil market has quote, absolutely nothing to do with saudi arabia and that quote, no one can dictate what's a fair price for oil. in november audi arab i can't, the global leader in oil exports decided not to cut oil output to combat sliding energy prices which are down over 55% in the past six months you can see it trading at 45 tlrs barrel. we have high level visits from the u.s. right? >> that's absolutely right. but this delegation of 30 people coming from the u.s. we understand that obama and michelle will be arriving today but they'll be joined by senior officials from the white house and also former officials as

well. james baker will be arriving. this is a man that lead conservative foreign policy for reagan and george h.w. bush. we also know that republican senator john mccain will be arriving here today as well and then of course other members of this delegation are going to include condi rice nancy pelosi. just folk prs the u.s. and what's interesting is the bigger question which is what's the administration hoping to accomplish? we know we'll talk about terror and isis and what's happening in yemen but it's a bigger question of how much the obama administration needs all of these other people to help this relationship evolve. especially with the new administration here and also i do want to mention earlier today we heard from the ceo as you mentioned and it's interesting. he came out swinging and he was doing this on the sidelines of a global investment conference that most people here thought would get put off because of the

death of the king last thursday but officials decided to go ahead with the conference. it was quite a big deal and we also understand that the ceo was talking about saudi arabia becoming the next big shale producer. >> absolutely. you're keeping us up to date. thank you so much now blizzard conditions shutdown new york city and much of the northeastern u.s. effecting millions of americans but the storm may not live up to the hype as one of the worst ever forecasters said it could dump up to 3 feet of snow but now downgraded the totals. still several states have banning cars on the road. more than 4500 flights have been cancelled today but business as usual for the u.s. financial markets. so far they said they will remain open. how will you be spending the day if you're at home dear viewer? get in touch with us and let us

know. we also want to see your blizzard pictures stay safe everyone. add adam sent his picture as well. boston new york expecting three feet of snow but it's not just about the snow. wind gusts are also expected to pick up which can lead to frees falling on power lines. that's a scary thought given how cold it is outside. my dad was out of power for weeks at a time so he just when down to florida. >> there you go. >> people could be trying to avoid the cold weather but i'd never complain about a snow day. >> when you're small it's a good thing but when you become working it's a difficult thing. >> as a journalist i'm stuck reporting on it. >> you did the polar vortex.

you must have some warm items of clothing. >> i had the hand warmers. they're so beneficial. >> could have used those in davos last week. >> let's get a check on european markets on this side of the world. the ftse 100 is down about .3%. that gdp figure came out not too long ago. in line with expectations. 0.6% increase over the last quarter. it was the fastest pace in a long time. the xetra dax is down .6% and cac 40 down .6%. but swiss equities are up 1.1%. this as the franc weakens against the euro. >> what does this mean? we're going to see financial markets open just like any other regular day. futures pointing to a lower open.

the dow down 67 points. apple reporting earnings tonight indicating a lower open by 16 points. s&p down 4. u.s. markets bracing for data deluge. we take the pulse of the u.s. economy with experts after this break.

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>> these are headlines from around the world. >> let's start with weather. millions of americans are hunkering down as a major winter storm sweeps through the region shutting down roads and forcing thousands of flights to be cancelled. >> microsoft kicks off the biggest u.s. earnings week of the year meeting growing violence in eastern ukraine. meanwhile russian stocks and the rouble bounce back despite s&p downgrading it to junk. >> facebook and a number of other social media sites suffer a global outage with hacking group lizard squad claiming credit for the attack. >> and the top story, blizzard

conditions shutdown new york city and much of the northeastern u.s. effecting millions of americans. it may not live up to the hype as one of the worst ever. forecasters originally said it could dump 1 to 3 feet of snow from new york to boston but now downgraded the totals. high winds caused several states to ban cars on the road. more than 4500 flights have been cancelled today but it's business as usual for the financial markets. the new york stock exchange and nasdaq will be open. now in terms of financial impact of the blizzard there's been a lot of talk about which stocks could out perform or underperform. let's start with some of the underperformers. they're writing there could be shopping disruptions related to the incoming blizzard that could cause stores to close and revenue could be negatively impacted specifically tremendous tailers with a strong presence in the northeast. names like american eagle, urban outfitters and t.j. max some of the ones to watch.

restaurants could also be impacted. it expects the most immediate negative effect to be felt on fast food and casual names with heavy exposure to the northeast. dunkin' donuts and panera bread. companies that could benefit and consumers preparing for the worst, home depot and lowe's. >> i wonder if some of these restaurants had a good delivery system if they could turn things around. >> they probably need the work force in place to actually deliver it. >> you have to get someone to do that. >> meanwhile we're seeing delays of earnings release. coach delayed the release of its earnings from today until thursday due to the severe weather expected. they also reported a day early while emc and boston properties postponed results until later in the week. as we were mentioning before you could see a decrease in liquidity this week as traders trade from home or skeleton

crews at some of the bigger offices, banks, hedge funds. >> it's inevitable that many people are not at their trading desk today so they're watching the financial markets from home maybe more focus will be here on london. >> and kind of thinking perhaps hotels could get a boost, right? i have heard that banks are going to be putting some of their employees up so they can be closer to the office and not have to make a longer commute. >> it's possible. >> you even said that sometimes you get a hotel just so you can stay closer to the headquaters when you're in new york. >> there's a lot of corporations that look at hotel options depending on if they need their employees to be close by and want them to be able to walk to work. >> a big hit to tourism. a lot of flights delayed. we want to know how you will be spending the day if you are at home so american viewers on the east coast get in touch and let us know. we want to see your blizzard

pictures and you can join the conversation at worldwide exchange. or use our personal handles which you can see on the screen. we're also retweeting some of the pictures that we get in. >> as we have been telling you financial markets are open today despite the new york city blizzard. take a look at futures and how they're trading right now. the dow indicating a lower open by 62 points and the s&p seeing a loss of around five points. this is premarket trade. let's take a look at european markets. there's a lot of data to respond to. right now trading down by 20 points. slowing the final quarter of 2014. but annual gdp did come in at the fastest pace in seven years. the xetra dax has been in focus perhaps down 52 points. the cac 40 trading down by around 26 points. interestingly enough we have

been putting a lot of focus on russia given the news of further violence in ukraine. what the downgrade of status will mean for investors and interestingly enough stocks rebounding today. yesterday we did see the micex index trade down significantly by about 4%. rebounding up just about 2% but we'll keep an eye on russia. a lot of investors have been telling us here on worldwide exchange a lot of the risk might be priced into stocks. >> do you know they're receiving a bit of a lifeline from china. importing their oil we know was a sore point from the russian economy. speaking of that let's take a look at commodities and it's how we are looking. the rouble is stabilizing some what against the u.s. dollar. we're seeing a pop up. russia's credit rating was actually downgraded. if it gets downgraded by another agency that could take it out of a lot of the investment grade indexes. that's something to watch.

our guests saying they expect that to happen fairly soon. sooner rather than later. something to watch out for this. may be a short lived rebound. it's been very volatile. this is the biggest drop against the euro. the swiss national bank stepped in and removed the floor. we'll continue to monitor that. the u.s. dollar and japanese yen were sitting at 11811 and the euro dollar regained some of its strength from yesterday. we're sitting at 113 but yesterday it did drop to the 110 level. let's take a look at commodities now. we're seeing both wti and brent crude. the international gauge rising today. we did see some disparity earlier in the session but wti crude trading above the $45 barrel level. brent crude at 48.30. spot gold we have seen a little bit of a safe haven bid over the last few days sitting at $1,282

an ounce and copper under pressure, $2.55 and change. >> let's get a rundown of what to trade today. durable goods out at 8:30 a.m. eastern. demand is expected to rebound after a surprise decline in november. at 9:00 a.m. the home price index. prices are expected to hold steady after growth slowed for a 10th straight month in october. now at 10:00 a.m. it's december new home sales which are forecasted to rise after falling the previous month and january consumer confidence which hit a two-month high in december. but to discuss more about what to expect today and the future of the economy we're joined by lindsey, chief economist at stern a.g. there's a lot of concern this will have an impact on the

economy. >> we expect the storm to be short lived. maybe a temporary bump today at a here or there but not a very large impact when we talk about the monthly or annual seasonal data. >> how important will it be for the housing sector? correct me if i'm wrong, back in late 2013 and early 2014 we did see a drop in home start sales. a lot had to do and less people in general looking to buy a house. >> but remember last year was a prolonged extremely severe winter season and most of the housing data is seasonally adjusted so we do take into account that in general people are less likely to go out and search for a house during these very cold months of the year. so again, if these storms are short lived it's unlikely it will have a major impact for the housing data. >> it's the fomc meeting.

we'll get an opportunity to hear from the fed since policies around the world have diverged more since the last meeting we've had. the ecb ease and bank of canada ease. are they going to change their language at all? >> certainly very exciting the first policy meeting of the new eyre but we expect the fed to reiterate their commitment to accommodation and continue to use the new patient language we saw introduced at the end of 2014 in reference to a very slow lift off. so while expectations are still very heightened from possibly a mid year rate increase, we are very much expecting the fed on hold. there's still a tremendous number of perriers and burdens facing the u.s. economy and recovery liking to keep the fed on hold despite a rate increase.

>> a big story in 2015. do you think the fed will reference the downturn put in place by mario dragi? >> she is going to have to reference the weakness on a worldwide basis but more interesting we might see an increased risk assessment to continued sluggish inflation. not just worldwide but specifically here in the u.s. particularly in the labor market average hourly earnings since the end of the recession showing out right deflation. it will be interesting to see if she recognizes that not only on a global basis but here in the u.s. as well. >> we'll be watching the first policy meeting of the year and as you said quite exciting. chief economist at stern a.g. thank you for your time. >> as we have been telling you, blizzard conditions have virtually shutdown new york city boston and other parts of

the northeastern u.s. effecting millions of americans but what was being called the worst storm on record may not live up to that billing. chris is in boston with the latest. how does it look out there. >> it's really coming down right now. it could come down at 2 to 4 inches per hour. an inch an hour. it's kind of a big deal. it's snowing harder than that. we expect the heavy snow to continue at least in through noon and the storm itself could linger into wednesday. approximate you can believe that. now the big problem here besides the the snow is the wind. nantucket saw a 70 miles per hour wind gust which is approaching hurricane speed and here in land we're seeing upwards of 50 miles per hour wind gusts. so it's causing a lot of blowing and drifting.

now the good news is the only people on the roads are snowplow drivers and emergency vehicles because there was a travel ban here in massachusetts that started at midnight. many states all around the region, throughout new england and new york said don't go to work. don't go to school. stay home. you might be in there for the next two to three days. here in boston schools are closed for today and tomorrow. eastern massachusetts is much the same way and logan airport while remaining open is having no flights come in or out. so if you want to go to the airport you can go to the airport there's just no planes there and they said that they want to reopen as soon as possible but that might not be until wednesday either. it appears that people have heeded the warnings and they're staying inside and grocery store shelves were stripped bare as people prepare to ride this one out over a period of a couple of days. one of the biggest concerns here is coastal flooding. we're seeing high tide come in

about now and it will be happening in another 12 hours or so. many could see homes damaged from the surge. >> of course the other big concern is wind gusts which could pick up in the next couple of hours. that could lead to trees falling on power lines. you're not only talking about cold weather but residents not having electricity. >> you can see that in his picture how it was swirling around. we'll be talking weather throughout the show but still to come as well eu leaders put the blame on moscow for flair up in violence in eastern ukraine. are more sanctions on the way? we'll discuss this after the break.

welcome back. these are your headlines. millions of americans in the northeast hunker down as a major winter storm sweeps through the region. microsoft profits take a hit from a strong dollar as wall street gears up after the bell. and facebook denies it was the victim of a hack attack blaming a global outage on a system's change. and european leaders have urged moscow to condemn the actions of separatists in eastern ukraine siting continued support for the

rebels and called on foreign ministers to consider further action against russia including sanctions and russia's credit rating being cut to junk by s&p. several are responding. in fact the spokesman says the credit ratings decisions are politically motivated and are not related to economic realities. and interestingly enough financial markets not responding the way you think markets would with russia's credit rating being cut to junk status. >> or perhaps they sold off so much. >> perhaps. >> russia needs it's own credit rating agency like china. >> like china. >> then they can boost it up a little bit if anyone would believe it. but meanwhile the rouble firmed against the dollar after yesterday's slump as they sell their foreign currency. earlier we spoke to the senior director of europe for s&p. he says the outlook looks bleak. >> we have revised our long-term

growth expectations to around .5% and we think it's going to contract this year. that's going to impact public finances and the banks. the banks could hit the physical situation for russia. >> another developing story. u.s. prosecutors have arrested a russian banker in new york charging him and two others with spying for moscow. the fbi says they allegedly were seeking information on a number of topics including the new york stock exchange u.s. energy resources and sanctions on russia. the man also allegedly tried to learn about high speed trade in order to rock the u.s. markets. the banker has been denied bail. prosecutors say the other men are protected by diplomatic immunity. so it's a developing story. one we'll keep you up to date on. >> still to come on the show our next guest says microsoft is moving in the right direction. up toward the cloud. but can the tech giant weather headwinds? we take a look at the earnings straight after the break.

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users reported being unable to log on to the website by their pcs or mobile apps but service is now restored. a twitter account linked to the hacker group called lizard squad is claiming responsibility but facebook is blaming a system's change for the outage. >> microsoft second quarter profit fell more than 10% as sluggish pc sales hurt demand and the company struggled with the impact of the stronger dollar. revenue rose a percent. shares fell about 4% in after hours trade. trading down about 4% in frankford. joining me to discuss is the managing director of fbr capital markets. pc stabilization, a rebound has been one of the reasons we saw old school tech names like microsoft outperform in 2014. is that rebound in pcs over. >> i think that little renaissance that we've seen the

tail winds lean and they're definitely going through this transition as he tries to take the company into this cloud, mobile area. now the focus shifts to window's 10 this year and that could be the upgrade cycle. but i would use as a speed bump in terms of a quarter and it's the first blemish in the era after what i would call the honeymoon period in the last year. >> what about going forward? leaving pc and software aside, microsoft just came out with the hollow lenses that folks are impressed we. we don't know when it's going to hit the shelves. do you think this could be a start for successful in inknowization for microsoft. >> i do. this is trying to break from

their traditional mode of pc. they need to get to the growth area of mobile and cloud. as they go to more transition and transition to the cloud it's going to be a bit, i think disappointing for near term results but i think they're going to emerge a lot healthier company and one that's a lot less reliant on pcs with the windows 10 upgrade cycle at their back. >> apple is reporting earnings tonight and they made a big push into china with it's partnership with china mobile but apple's market share in china still in the single digits. can apple get a larger chunk of the pie in china or do you think it's still dealing with stiff competition? >> i think that's going to continue to be an uphill battle. apple as well as microsoft and ibm are seeing continued challenges in china. and that's something they'll

have to figure out in terms of market share but investors are looking at some of these growth markets where you want to see fuel in the engine as you've seen some softness in the u.s. as well as throughout europe. across the board. so those are some growth areas investors will be looking over the next year. >> all right. we'll leave it there. managing director and senior analyst. just want to point out that jp morgan has cut their rating on microsoft from neutral to overweight target price from $47 to $53. this is one of the winning trades when looking at the tech index but perhaps maybe expectations were too high. >> i was saying this was just a blip but obviously not. microsoft did kick off the biggest week of the year for u.s. earnings with pfizer procter & gamble and apple all reporting today. the big tech news keeps coming on wednesday with facebook out after the bell but premarket we also hear from boeing and fiat

chrysler. on thursday we have alibaba, conoco phillips and ford all before the open. after the bell google and amazon take a turn in the tech spotlight. finally we hear from chevron, mastercard xerox and mattel. we'll be busy this week. >> absolutely. all eyes will be on apple and a story we're learning about from reuters, router is reporting that the company's taiwan based supplier plans to shrink it's work force due to slowing sales growth. an assistant to the group's chairman said a dramatic increase in labor costs was driving the move. an interesting development there. >> they had issues so this is probably some continuation of paying their workers more but i wanted to bring up facts about apple because a colleague sent this to me and they're mind blowing. revenues estimated to be at about $67.5 billion if that's true. most analysts expect these expectations to be blown out of

the water. apple made more in three months than google all year. >> it's been a growth story. the focus will be on smartphone sales. howell did the iphone 6 do and will sailles in china be better. >> and money made just from iphones this quarter is expected to be almost the same as revenue from google and microsoft in the quarter combined. >> amazing. >> that tells you where they're getting their business from. >> and apple watch will be announced or unveiled in march. will it be a game changer for the wearable industry? we had samsung be the first mover in the wearable space but that did not take off so the question is will apple's product steal the limelight. >> i'm looking forward to it. >> and the price point is key. $299. it's a little high but let's see what happens. let's take a look at u.s. futures. it's a regular day of trade despite the blizzard hitting the northeast. dow inkating a lower open by 61

points. it will be all about the nasdaq given the tech stocks reporting today. nasdaq down 16. more talks about financial markets coming up after this break. chasing performance can mean lower returns and fewer choices in retirement. know that proper allocation could help increase returns so you can enjoy that second home sooner. know the right financial planning can help you save for college and retirement. know where you stand with pnc total insight. a new investing and banking experience with personalized guidance and online tools. visit a branch, call or go online today. [ male announcer ] whether it takes 200,000 parts ♪ ♪ 800,000 hours of supercomputing time 3 million lines of code, 40,000 sets of eyes, or a million sleepless nights. whether it's building the world's most advanced satellite, the space station, or the next leap in

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and it is 5:30 a.m. in new york. 10:30 here in london. welcome to worldwide exchange. >> good morning. these are your headlines from

around the world. >> it's all about weather. millions of americans in the northeast are hunkering down today as a major winter storm sweeps through the region shutting down roads and forcing thousands of flights to be cancelled. >> microsoft kicks off the biggest u.s. earnings week of the year meeting estimates but profits take a hit with the strong dollar sending shares lower after hours. >> european leaders put the blame on moscow in eastern ukraine asking foreign ministers to consider further sanctions. meanwhile russian stocks and the rouble bounce back despite downgrading russia to junk status. >> facebook denies it was the victim of a hacking attack blaming a global outage on a system's change. >> you're watching worldwide exchange bringing you business news from around the globe. >> let's take a look at how u.s. futures are trading today as new

york city braces for a massive blizzard. the new york stock exchange the nasdaq will be open for trade today. s&p 500 down about 3 points. dow jones with a lower open around 36 points. the nasdaq down about 15 points. big week for tech earnings. a lot of focus ahead of the earnings report. diving into the european markets, investors keeping a watchful eye on the fall out of the greek election. the new prime minister of greece putting together his cabinet. we have been seeing investors taking money off the table. greek stocks continue to underperform but let's take a look at the ftse 100. u.k. market down about 19 points. we got a read today. uk economy slowing. some investors reacting to that. the xetra dax was the out

performer yesterday. down about 41 points in today's trade perhaps on the back of news out of russia. we'll get to that in a second. the cac 40 seeing a loss of 26 points but take a look at the micex index trading up around 2% despite russia's credit rating being cut to junk by s&p. this will be harder for russia to borrow money from investors but at this point inves tors don't seem to care and perhaps they think the financial risk is already priced in and we're seeing it rebound right now up just about 2%. >> well, the streets are virtually desserted in new york city and other major metro areas as a major winter storm sweeps through the region. forecasters are backing off their initial dyer predictions but that doesn't make the streets less dangerous. we do have morgan brennan out in the middle of it all and she joins us now from new york's time square.

thanks for being out there. i hope you're keeping warm. >> i'm trying to keep warm but it's really cold out here and win do out here. the foe continues to fall as of midnight eastern time we have 5.5 inches in central park here with another 5 to 8 inches forecast. that is slightly below what was initially anticipated. but further east of here they're expecting 24 inches of snow and you can see that in the video we'll be showing you. the impact of this blizzard on parts of new england but it's not just about the snowfall. it's about the really high winds. these blizzard winds and that's why we have six states that have declared a state of emergency, connecticut, new jersey rhode island, massachusetts, the lower part of new york state, and just in the past hour maine as well. we have seen major highways and

streets closed down. we have multiple states that have imposed travel bans overnight here and here in new york city we had not only streets closed down at 11:00 p.m. local time but public transportation. subways, commuter trains buses. that's not something that happens often but we even saw broadway close down last night. there is one place that is open for business and that's wall street. all the major exchanges in new york will be business as usual today. at least that's what we're hearing so far. the new york stock exchange and nasdaq all will be open with regular trading hours. so guys it's really cold out here. the snow is continuing to come down. what we are hearing is they're starting to lift the blizzard warning put in place by the national weather service in certain part of the region but we're a long way from done. back to you in london. hope you're staying warm. >> we are.

stay warm. stay safe. i know new york and boston expecting three feet of snow. thanks so you so much. keep in mind there's cold winter trades that investors keep an eye on during storms like this. like the one hitting the northeast on the apparel side. some names to watch include columbia and deckers outdoor which makes comfortable boots and equipment makers is a company that specialized in snow blowers and chains. also some say netflix, online streaming may be a cold weather trade. more consumers spending time at home binge watching house of cards or whatever your favorite series is. these stocks aren't necessarily one that rise every time it gets cold but they're some of the stocks and sectors that investors tend to watch during the cold blizzards. >> do you know what else you can do? get online with the blizzard setting all time snowfall records. stay up to date by heading to our website. that's cnbc.com where we have a live blog with all the crucial

details. >> now 30 top u.s. officials will arrive in saudi arabia today as part of a high level delegation set to pay tribute to the late king abdullah. president obama and secretary of state john kerry will meet the successor as tensions with state neighbor yemen continue to rise. >> meanwhile the ceo of state oil company says the oil market in balance has nothing to do with saudi arabia and that no one can dictate what is a fair price for oil. let's take a look at oil prices. they have been regaining a little bit of ground today. we're seeing light crude up about 10%. that's about the $45 level brent crude at $45 and change. let's get to hadley. this is an interesting development from the oil company out of saudi arabia. also looking at shale? >> absolutely. lots of news coming out today. we heard from the ceo that says

basically that it's going to be the next new frontier in production. he also talked about how low oil prices are bad for everyone. he says that's because it makes it impossible to do new investments particularly in the area of shale but they're going to be the next new frontier. he also announced $7 billion worth of investment in capacity and gas. a big day in terms of the toil story but i want to mention these remarks came on the sidelines of a major global investment conference that happened here as well. so the message coming from saudi arabia right now is that they're open for business. also we have this delegation coming in. u.s. president barrack obama cutting that india trip short. he is coming in with michelle obama as well. meeting him here will be a huge delegation from the united states. it's bipartisan and what's interesting are the republicans he's asked to join him. particularly the former secretary of state james baker.

this is a man that headlined conservative foreign policy during the reagan and george h.w. bush administrations. he's a real friend to the saudi royal family and certainly to the late king abdullah so it's interesting that president obama is looking to reset relations and look to talk terror isis and what's happening in yemen with the saudis today but he's bringing with him a lot of trusted members of former administrations to do that. >> absolutely. it is a big dell fwags. you have to wonder what they hope to accomplish. thank you for that. now if you're among millions of americans hiding inside from the storm, a home cooked breakfast could be just the thing. find out why bacon is falling in price. that's up next.

the u.s. dollar continues to trade at multiyear highs amid expectations for a fed rate hike this year. federal reserve chair janet yellen kicks off the two-day policy meeting today with a press conference tomorrow. speaking to cnbc yesterday goldman sachs ceo warned over the negative impacts of a stronger dollar. joining us now in the studio is nigel green, managing director.

let's kick things off with the u.s. dollar. it seems like the most crowded trade this year. everyone seems to be piling in but signs of it hurting u.s. economy data a little bit over the last few weeks or so. is there any chance the fed may push those projections a little bit further out that first hike? >> they may. but if we look and they're saying that q-4 is when they will do a straight hike this year 2015. i think that's what the states will do. i think the strong dollar is going to continue. we'll see the oil price dropping over 50% in 2014. i think we'll continue to see oil come down later this year and i think that's going to fuel a stronger dollar. you look at and drop 16% since last july. i think we might see a slight

redress in the near term but longer term as we go through q-3 we may see the dollar start to strengthen again. >> we wanted to play some sound, gary was being interviewed last night and said the u.s. is becoming less competitive given that we export a lot of services. those have become more expensive. experts only make up about 14% of u.s. gdp. is there merritt to that argument? >> there is merritt because the fed and the treasury they always say they don't like a strong dollar but they'll never come and say we have a strong dollar policy. you go back in other regimes where they said that and i think it has helped the u. sflt over the past year. i personally think the strong dollar will stay. i think you have fracking so it's getting better in the

states for their own production of oil. opec is still putting out 30 billion, the barrels, they're not changing the output. if that continues it will put pressure. >> before we let you go we have to ask what's going on on this side of the world. we've seen volatility in the swiss franc and the euro. up by the most since the swiss national bank took the floor away. what's going on? is it the intervention talk? >> well you can look at it many ways but you have to think that it is. we combine .2%. you have to think that would be some sort of intervention. if you go back in time they tend to be sort of cautious but last couple of weeks you go bank of canada reducing their rates and what the swiss national bank did. what the ecb have done with qe and i think that it's just a change in direction for central

banks and they'll look at what it will do at this currency going into quarter 2. >> a change in direction and huge diver divergenecce. >> new york has been blanketed in snow. boston also expected to see a similar amount. we'll be keeping you up to date on the blizzard that has been hitting the northeast of the suchlt: we have been looking here at cnbc the financial impact of the blizzard and there's stocks and sectors analysts have been pointing out. there could be shopping disruptions that could cause stores to close and revenue could be negatively impacted. names like american eagle, urban outfitters and t.j. max.

restaurants and fast casual eat ris could also be impacted. they expect the most immediate negative impact effect to be felt on fastfood with heavy exposure to the northeast. we're talking about dunkin donuts and panera bread. analysts say home depot, lowes, companies that sell winter specific items such as generators. so some stocks to watch as we watch the storm hit the northeast. >> absolutely. if you're having breakfast this morning and you're a bacon lover rejoice. u.s. pork prices have dropped as the hog herds recover from a virus that killed millions of pigs since the spring of 2013. new vaccines slowed the spread of the virus and now the market is bracing for record production. consumers are benefitting as they are paying much less for their bacon, ham and other pork products. in the future's markets u.s. hogs are trading at four year lows. as you can see $70 and change.

>> before we go to break, here are your headlines at this hour. millions of americans in the northeast hunker down as a major winter storm sweeps through the region. microsoft profits take a hit from a stronger dollar as wall street gears up to report earnings after the bell and facebook denies it was the victim of a hack attack blaming a global outage on a system's change. more on that coming up next.

. welcome back to worldwide exchange. here's how european markets are doing right now. the ftse 100 trading .3% lower. we had gdp figures in line with what was expected. we are seeing some weakness

because we are in the middle of earnings season here as well and we did get weak results from leading companies such as siemens as well as phillips and greece in the back of investors minds or the forefront but we're seeing a divergence here. we're seeing the swiss franc actually decrease in value against the u.s. dollar today. >> that's right. now what does this mean for wall street? futures are indicating a lower open. keep in mind earnings will be the big focal point. apple is reporting earnings after the bell. dow down about 66 points in premarket trade. >> millions of people are unable to update their status or post photos online today as facebook and instagram appeared to suffer a widespread outage. something went wrong. services have been restored. the twitter account linked to

the hacker group lizard squad is facing responsibility but facebook denied hacking claims blaming a system's change for the outage. >> microsoft second quarter profit fell 10% as they hurt demand for window's software and the company vugelled with the impact of the stronger dollar. revenue grew. talking about earnings microsoft had pfizer procter & gamble and apple all reporting today. facebook out after the bell. thursday our attention will turn to alibaba reporting before the open. google amazon take a turn in the tech spotlight when they report later this week as well. >> meanwhile, you're also seeing some earnings being delayed because of the storm. coach is one of hem. they delayed the release of earnings today to thursday of course to the severe weather expected. they reported a day early while boston properties postponed

results until later in the week. >> joining us from seattle is cole smead. thank you for getting up early with us. you're also missing out on the winter storm hitting the northeast right now but i want to start with weather. will this have financial or economic impact on the u.s.? are there any weather trades out there? we were talking about some of the retail names that could see a surge in sales given that more people are buying winltter clothes. what are your thoughts? >> i hate to be the west coaster on the program out here in seattle. new york is a good sized city but there's other life going on in the united states right now. in relation it's not that big of a deal. just when the financial markets are huddled around a snowstorm suddenly everyone is in a snowstorm in the united states. we got 60 degrees fahrenheit in seattle and we're doing just fine. >> let's get to your trades. a big trend has been the

stronger dollar. what that means for multinationals that makes sales overseas. how do you think that will impact the farm cutepharmaceuticals. >> correct, the pharmaceuticals in general in terms of the portfolios we run is the biggest nonu.s. revenue exposure in front of us. health care has dealt with a big premium in the last couple of years so we have been tacking capital from there where there's a lot of domestic opportunities that don't deal with this problem in anyway shape, or form we were talking about rising dollar and relation discretionary. most are not bothered by the rising dollar but the microsofts and ibms, these big multinational companies that did really well growing outside the united states with a weak u.s. dollar are learning the flip side of that which is currencies

to and fro and it's impacting earnings growth because of the dollar situation. just to give you a feel i got back from europe for two weeks. the dollar is cheap when you look at the labor cost in europe instead of the united states in some cases you're paying as much as two times the amount of the u.s. worker in europe. so we look at that profit margins are low in europe and they're likely to revert higher as labor costs go down. >> okay. so is the opposite true? do you stay away from apple, microsoft, google that get so much of their revenue abroad? >> yeah our bias has been looking for domestic. let me use a clear picture of this. bank of america gets 84% of the revenues in the united states. we're comfortable with that risk. citi group gets 70% of its revenues outside the united states. this is not, hey, here's u.s.

equities. stocks are cheep four years ago and small caps are very expensive and people should tread very lightly in that arena but there's very good opportunities to own domestically oriented businesses. burt you have to own a stock picker and that's what investors do not want to do. >> we have run out of time but thank you for the insights. that's it for today's show. >> thank you for watching. next up is "squawk box." for all of you in the northeast stay safe and stay warm.

good morning, happening now, the northeast getting slammed in some places by a blizzard. tens of millions of people hunkering down.

flights cancelled. travel banned in places. 8 states made emergency declarations but on wall street the show must go on. the major exchanges all are going to be open for business today and there's plenty to do. a flood of earnings reports and economic data points on that agenda agenda. plus social media sites shut facebook instagram and tender among those suffering overnight outages. doesn't that figure. you're snowed in and you can't use tender. hacking group lizard squad is claiming responsibility but facebook denies a cyberattack. it's tuesday, january 27th 2015 and squawk box begins right now. >> live from the most powerful city in the world, new york this is squawk box. >> good morning, everybody. welcome to squawk box here on cnbc. i'm becky quick with joe kernen

and andrew ross sorkin. take a look at the pictures. we're in midtown manhattan. >> doesn't look like much i have to say. >> look at the drifts. >> i think we got a little faked out on this one. >> we're not complaining. >> we're not at all. the most dire forecasts do not appear to be coming true. there's about 8 inches of snow on the ground. the blizzard warning was cancelled for new york city