elementary school students and middle school students and high school -- they are passionate about leadership and they learn and discover that they've got this within them i think this really is a game changer. in the world today, people aren't really teaching leerdship and that's the reason we formed the institute at the university of missouri as well the. we have nine acredited hours and we want that institute to become the best practice for other colleges to come to. >> we're going to talk to you about this a lot moreover the months to come. >> it's a honor and real privilege. >> that does it for us today, make sure you join us tomorrow right now it's time for "squawk on the street. >> good thursday morning, welcome to "squawk on the street." cramer is off today. futures modestly in the green following the wild finish on wednesday. we do have more fed speak on top

today, boss tick and caplin, claims fall to 222 roadmap begins with rate shock jitters as investors continue to digest the hint on hikes. >> could the ecommerce giant account for 25% of the s&p 500 gains this year such as netflix and microsoft. >> walmart looks to challenge target and amazon making a big investment to boost online sales for home goods. >> stocks are looking to rebound from the big swings on wednesday. the dowrose more than 300 points and only to give up gains and finish down 167. the blue chips and s&p in the midst of a two-day losing streak and nasdaq is down for three days and has not had a four-day losing streak since november of 2016 that's how long it's been for the nas. >> it looks like they were going

to be in good shape yesterday and held onto the gains until the digestion of the fed minutes and amazon crossed 1500 for first time and fang really powered the nasdaq higher until of course, the minutes. >> now the journal is looking at individual stocks that are responsible for the year to date gains on the s&p and amazon, worth more than a quarter, 27% amazon alone followed by microsoft and netflix. i think financials about 13% or so but it's been a tech year to date. >> as we point out of course, it is a market cap weighted index which is why it is a relevant index. it's one point i make time and again but that's why when you have that much market cap and that short amount of time in terms of actual gains. we talked about the ability to withstand anything that comes at it and compete in every new industry it seems nearly a day doesn't go where we they see margin that

can be attached. >> but of course it was the digestion of the minutes, curious 2:00 hour when we were on the air taking a look at the minutes and what the reaction was. initially the reaction was positive and hit session highs off the back of the minutes there. we saw a record all time high for the regional bank index and there's a sudden realization, what the fed is saying, may be a little more hawkish. there may be more interest rate hikes than the market is forecasting. the markets were not and then that's when we saw trouble when that 10-year yield went up towards 3%. >> plus, people started to talk about the fact that the meeting itself was before the employment report that spooked the bond market at least. it still gets kicked around today and bullard saying 100 basis points in '18 is maybe a leap, that the economy would have to upside surprise many times this year for that to make sense in his view. nonvoting people but did make

waves. >> yeah, it still seems the consensus is calling for three moves this year on the fed and again, to your point, carl, these minutes were prior to that wage inflation number we saw with the last employment report. and certainly there will be a great deal of focus as you might imagine on both of semiannual fed monetary report which comes out tomorrow and then more important powell's testimony come pretty soon actually, end of the month, right? >> yeah and those will be drivers. in terms of the yield, we hit close to the highest level since january 2014 on the 10-year yield and we'll be looking at that january 2014 high as potential resistance, 3.0516, not just the 3% range. if we cross over that january resistance high, the next stop could be 3.14, closer to that. that should be an interesting push/pull in the markets for more on the markets here, joining us ats post nine is bank of america senior u.s. equity strategist and jim lowell at

adviser investments. good to have you with us mark, what's your take on where we are in this it does seem like once the 10-year yield goes close to 3%, that's the gate on the markets >> at the end of the day, 3% is just a number and if we do breach that number the market will eventually digest it. the good news we're continuing to see the economy gain traction again today and unemployment data just reaffirmed that. we in fact hike the u.s. gdp forecast twice upwards and we've done some analysis around interest rate movements and stock market reactions to that in fact, just think back to the best returns we've seen this entire cycle, 2013, market was up 32% and that's when you had the tamper tantrum when rates hiked over 200 basis points. >> it's the speed that's your concern? >> no, in fact, sometimes when the speed of the rates -- a lot

of people believe that that is a negative and the evidence is kind of scant on that. my point is finance 101 tells us as the cost of funds goes up, asset prices should go down all else equal but all else is never equal. the other part of the equation, when rates are going up, typically growth is also improving and that's what we're seeing right now. >> of course jane, what's your take on how the markets digested the fed minutes and where we go from here >> we continue to say you ought to follow the fundamentals not the fear the facts on the ground are seeing robust earnings growth and interest rates may tick higher but we don't think higher rates and higher inflation mean high rates and high inflation. we'll still be in a very low accommodative range, we think all throughout 2018. so when you look at the economic data, interest rates, earnings, there are all pointing to a positive growth in what might typically be a late stage expansionary cycle, in u.s.

history right now. but we think we have some room to grow. we're keeping our eye on the employment numbers we're keeping our eye on consumer sentiment and consumer spending but as far as we can see, the fear is overblown and way too early. we simply do not see hyper inflation in the cards although we definitely understand that this is a market where you're going to want to be very selective in terms of the stocks you're buying and not just buying whole baskets assuming there's no risk in doing so. >> i'm curious whether or not you think we're not in store for margin pressure, peak earnings revisions and just an overall rollover in earnings growth as you say, things not being equal but earnings adding to that. >> that's i think your big risk down the road is margin pressure you are seeing inc., links of wage pressure moving up. are companies going to be able to pass that on toconsumers or not. that's a big question down the road higher rates, if you look at the

s&p 500, 70% are long term fixed so higher rates isn't necessarily a negative near term as well. but globally, if you look at earnings revisions, they are continuing to improve around the world so to me that doesn't -- that doesn't spell peak markets. >> at the same time, we are expecting i would imagine you would probably expect some volatility even though the markets will eventually as your point is digest 3% or whatever 3.plus percent, what sectors can ride that volatility the best? >> absolutely. we're returning to the normal market conditions and normal market conditions means volatility comes back and as jim alluded to, inflation is still relatively low and we're still in the sweet spot. sweet spot is 1 to 3%, we're well in the sweet spot the one area of the market that historically has underperformed when you see rising rate cycle is consumer discretionary, that's an area that has a lot of employees and hence prone to wage pressures, negative prone

to that. i'm continuing to like tech and financials since the recent market pull-back those are two of the strongest sectors, if you're worried about inflation, materials is a good hedge towards inflation as well. >> got it. thanks and thanks to you jim, as well >> when we come back, we'll go to andrew sorkin, a big day for team usa as you probably know by now. a big morning for elon musk as facex falcon 9 is getting ready for liftoff in a few minutes there's a picture of the air force base, another look at futures on this thursday morning. more "squawk on the street" continues from post nine in a minute

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let's get to andrew ross sorkin in pyeongchang south korea, a big day for team usa, you talked to maddy rooney from women's hockey what a match. >> it was remarkable big headline of course is the u.s. women defeating canada for olympic gold it was quite something a real nail biter here this afternoon. went to a shootout and then the usa pulled it off.

first time we should say in 20 years that the american women have won the gold. moments ago we caught up with goalie maddi rooney and hilary knight to talk about the victory. >> an undescribable feeling to see everyone sprinting at me, it was amazing. >> reporter: you've done this before and been through this rodeo but on the wrong side or not this side. what was it like >> it is a dream come true i remember in 1998 he was jumping up and down on our couch and 20 years later winning a gold medal, doing exactly what they did, pretty cool. >> and for the first and probably last time mikaela shriffin took the silver and lindsay vonn made a mistake and

didn't finish what was probably the final game in her career i know you're a schiffrin fan, i don't know if you saw the stortry, how she bought 35 different pairs of skis to the olympic games. >> and normally brings 70. >> it's an unbelievable think she says geoes home proceedeudl a medal. great news about this medal board. if you remember over the past couple of days, there were some days the united states wasn't even on this screen the top five the u.s. now in fourth place with 21 medals, right behind canada at 24 we still have a chance to catch up here between canada and germany. there's a good shot here, guys, norway is at 35 and netherlands right behind us. >> it has been an unbelievable day here between hockey and between the skiing and it's just -- you can feel it in the

air, carl. it's a great thing. >> did you see the video of the canadian hockey player who took off her silver medal. >> didn't even want the medal. couldn't even bring herself to keep the medal on. that's what -- really speaks volumes about the rivalry between the u.s. and canada in women's hockey and of course, the last olympics it was on the opposite foot but so great to see this team win today. >> as someone said in canada, there's either gold or no gold there's no silver. and we definitely know what that's like because the last couple of games had not gone our way. andrew, we'll come back to you later on this morning. i want to pivot to spacex this morning. the falcon 9 set to take off in vanderberg air force base in california musk's company will send the rocket into orbit and launch an earth observation satellite for spain, two of their own sat l satellites for the first time. the launch was supposed to

happen yesterday and got scrubbed for high winds. morgan brennan is at post nine helping us look at this and talk about what is significant about it for musk, for the company and more broadly for broadband access all around the world? >> exactly this is the pause mission, a spanish satellite that is being launched into low earth orbit but it those two additional smaller satellites hitching a right on this falcon 9 rocket out of california. in the next couple of minutes everyone is watching closely they are made inhouse by spacexxts, musk hopes will be the star lincok con stelation, what will ultimately be tens of thousands of these satellites to beam high speed internet back to earth. this would represent a new revenue stream for spacex and new profit to basically fund all of these ventures to ultimately get spacex and humans to mars.

>> tens of thousands >> wow, that's a lot of traffic up there. >> a lot hinges on these two satellites, they are the test si satellites. >> this on a day with wilbur ross was on squawkbox, the administration is now committed to sending americans back into space and back to the moon here. >> exactly. >> let's listen to this count. >> six, five, four, three, two, one. liftoff. stable propulsions nominal.

>> guys, this is a falcon 9 rocket it has launched off of the launch pad at vandenberg air force base in california that spanish satellite and two additional spacex made satellites, it's heading to low earth orbit. that pay load will be deployed in the next couple of minutes. unlike previous missions we've seen, the boost every on this falcon 9 will not be recovered the company is not planning to recover it this represents the fourth launch this year. >> did you see what musk instagramed? a ship where he says we're going to try to catch the giant faring nose cone as it falls back from space at eight times the speed of sound it has onward thrusters and guidance system to bring it

through the atmosphere intact. basically called it a giant's catcher's mitt welded on a boat. >> this reu ususability concepth musk, they've been recapturing launches and other key hardware on these rockets. >> what do they get paid for something like this? do you know? what is the spanish company or what is typical? is there a typical fee at this point? >> the listed launch price by the way, listing launch prices publicly didn't exist before spacex, is about $60 million >> all right we don't know if they are getting discounts off that, but that's the list price. >> that's the list price. >> they have a coupon. >> if i want to launch us into space -- >> i will note as well, especially given the high risk of something like an explosion, which we've seen -- >> speaking of which, how significant is this launch compared to the heavy we saw weeks ago where musk did talk

about millions of pounds of tnt equivalent. >> so the heavy is basically three of these rockets that we just saw launched put together its thrust of 5 million pounds, the equivalent of i believe 18 boeing 767s taking off at the same time. i might have those numbers wrong but it's extremely powerful. and that launch price on that is only about $90 million all in, maybe $150 million. >> got it. >> that's cheap for space launch. >> let me make that clear. >> now i've got my prices set. >> this looks clean as far as you can tell. >> yes, as far as we can tell. >> we'll be looking to see if musk says anything else on twitter. >> yep, morgan thanks. morgan brennan. >> still to come, shares ever roku have soared since the september ipo but the guidance taking a toll on the stock today, down 19.5%. we'll talk to the ceo anthony wood and let's take a look at futures, we could be getting a

bounce back after yesterday's declines on the back of the fmoc sch lo s&p looking at about 10. squawk on the street straight ahead. we've been preparing for this day. over the years, paul and i have met regularly with our ameriprise advisor.

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nasdaq trying to avoid a four-day loss as futures are higher, claims under way and lei coming and plenty of fed speak opening bell in six and a half minutes. ♪

feel that? that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

people don't invest in stocks and bonds. they don't invest in alternatives or municipal strategies. what people really invest in is what they hope to get out of life. but helping them get there means you can't approach investing from just one point of view. because it's only when you collaborate and cross-pollinate many points of view that something wonderful can happen. those people might just get what they want out of life. or they could get even more. just about three and a half minutes to the opening bell. let's bring in art cashin who joins us at post nine. good to see you. >> to those trying to make sense of the last couple of hours of trading yesterday, what happened >> well, i actually think it may

have been our old friends, the bond vigilantes, initially yields moved down stocks rallie like crazy then about eight minutes into that move stocks went back and noticed that bonds had changed their mind now, separate from the minutes, there was a presentation at that meeting by key economists at the fed about measuring and projecting inflation and they basically said we don't know so back when the bond vigilanty es were around, they headed a fed that got around the curve. so the idea that the fed may not have had or may not have a handle on inflation, projects the idea that they could in fact fall behind the curve. i think that sudden idea popped

up and once they started selling, there were no goods to sell into. you had a thin market and reversal and we're going to need a couple of weeks to see if the bond vigilantes are back or not or whether it was a fluke remembering well what the bond vigilantes looked like sure had fingerprints on it. >> it seems if you're a trader in the market, as soon as the yield goes up above 2.95, closer to 3, that's when you hit the troubled waters and start selling. we almost seem range bound here. >> well, you are but you're on a threshold. i mean, that 3% level is both a target and a kind of resistance. everybody knows it's like touching the third rail. the assumption is once they do it, all hell will break loose. we'll wait and see. >> will all hell break loose i'm not so sure because too many

people are looking at it when you look at all that's going on -- getting some chants of usa here on the floor of the nyse team luge is ringing the opening bell in a couple of minutes. if you're not aware, chris mazdzer, star lugger, women's team beat canada last night and now curling, can ada lost to hockey and curling in the same day. >> first in -- >> canada no longer. there's chris right there. great guy who we got to spend time with in south korea he's going to help ring the opening bell so then what's the -- how is the table set today then >> well, i think they are going to try to restabilize here as we discussed yesterday, the feeling is that you may have to go back and retest the lows of the week and a half, two weeks ago and i think we're kind of set up for that but it's going to be a

multisession process i don't think they are going to get a trap down and go right to it >> our thanks to art cashin. let's get the opening bell and s&p at the bottom of the screen of the at the big board u.s. olympic medalist chris mazdzer with a historic silver, at the nasdaq, a leading own and operator blnk and provider of electric vehicle charging services there's definitely some team spirit going around today. >> there is. you did not try the luge, did you? you did a lot of things there, carl >> we did try, getting on to that track between the practices and events, virtually impossible. >> was it? >> not to mention the liability for media. you can imagine what sorkin and i would have done on the track i would have been in traction. >> the back guy pushing and jumping in, i don't know

which -- >> i would want carl to push, a little more traction than andrew -- no offense to andrew >> i understand. >> we should look at a few things, we're broadly positive as we expected to be given what we saw for futures a couple of news stories worth mentioning, ford for example, another victim of the me too movement potentially at least, raj nar, removed as the man who ran north america for ford following what they call misconduct allegations, not a lot more to go on there. but a lot of other announcements related to it would seem this morning. group vice president and president ford north america, joy fell at ka named group vice president and number of other important moves there, melissa this morning ford not doing much of anything. but it is facing -- been facing a fairly difficult period, of course key focus being production of ev

vehicles and automation and what's going to happen under the new leadership that they've had since mark fields was moved to ceo. >> importantly for field with nar's departure, that was a profitable unit at ford. this is -- it could be a real disruption in terms of ford's turnaround in relationship to gm and the others and of course this me too movement and the scrutiny on the sea suite expanding since steve wynn was kicked out of his own company which he founded which he had such a strong role in. >> the win res ynn resignation remarkable, detailed in the wall street journal with very strong reporting there, moved the board to say it's time but there's more to come, we think, it is a slow drum beat but we continue to see the headlines and people leave often times it is not fully explained. there are some departures.

i can think of one in particular, they cite one thing but it may have been related to this misconduct that we're starting to see. people pay the price for and wynn certainly had to be -- one of the more remarkable moves. when it comes to wynn, no shortage of rumors as you might expect around what goes to be the future of that company, what will they do will they try to split it? is it possible to keep macao and sell u.s.? it doesn't appear there's anything on the near term horizon in terms of big moves for the company. >> taking a look at baker hughes, this one worth watching, general electric at investor meetings say it will not at least at first sell off its stake in baker hughes. it will wait for the lockup expiration to happen that is up 2.5%, this removes a great uncertainty for shareholders of baker hughes that stock had been treading water and trading lower as ge

plumed the depths of its lows, yesterday in the low 14's, almost all the all time high it's a bit higher today, up half a percent. >> a fairly damning story about jeff immelt and rosy outlook he gave that were not reflective of the reality of the company many of us trying to understand what happened there over the last number of years at ge what did the board know, didn't the board know near term for shareholders there are going to be three new directors added to this board and i'm told most perhaps as soon as next week we'll know we'll see what those names are remember that same board going from 18 eventually down to 12 directors, three -- and the three new ones being part of those 12 and then we're going to wait and see what we report on sometime back, which is namely the possibility that ge will truly be split up in some fashion. it doesn't necessarily mean that

power is going to be sold or ge capital can be moved, what's left of it but aviation and health care as you might imagine are very, very strong businesses and the board and its advisers continue to look very thoroughly at all of the options involving those key parts of the company, whether they can create some value, send the stock up as opposed to where it's been headed which is pretty much straight down. >> speaking of break-ups, bloomberg has this piece about united technologies and comments made by greg hayes yesterday, companies at least mulling splitting into three separate companies focused on aerospace and elevators and climate control. decision expected by the end of the year utx now the top performing dow component at the moment. >> yeah. you know, back to ge for a second you can imagine -- it's not impossible to imagine a scenario in in fact a split like that were to happen, that you could reverse trust and aviation business of ge into a separate company that utx would create for the same unit.

antitrust is always an issue in these things and would be with honeywell and would be with all of those three but those are the kinds of things you need to start thinking about. >> it's fascinating what sorts of options open up once utf says we're willing to break up. >> honeywell was under pressure, ceo decided against a full break-up being pushed by dan lobe to consider the same kind of move with aviation. watch this space, i think is a fair thing to say. just in general in terms of aviation related to utech and ge as well. >> dow is getting support there, almost 200 on the back of utx and caterpillar and boeing, any time you have those among the top performers you see movement in the indext, apple too good point as for earnings, wendy's 11 cents meets comps up slightly below expectations and cheesecake came in with a meet as well, revenue miss, comps up just shy of 1% and hormel, bunch

of consumers, a meet as well and they said they'll raise wages on the back of tax reform. >> check on roku, we were expecting this to be a big mover in today's session and in fact it is. down 21% the guidance was the troubling part of what the company reported it was largely a good quarter they reported but the guidance for the current quarter we're in, that was problematic and device revenue is problematic and the revenue was down year on year and even though the number of devices sold year on year was higher which indicates there's tremendous competition out there that could be price competition out there as well. we'll be speaking to the ceo anthony wood in the next hour of "squawk on the street" here. one of the pure streaming plays in today's market. >> they want to be thought of more of as a software company as opposed to device and hardware but -- that shift -- >> it's a shift.

>> to a certain extent they've been pushing that for some time but, yeah. >> finally, did you see snap >> yeah. >> snap is down almost 3% on this tweet out of kiley jenner who says so, does anyone else not open snapchat anymore or is it just me, ugh this is so sad 20 million followers on twitter, hard to know how much impact it may have but stock down on a pretty good take this morning. >> is she that much of a social influencer that it would be an impact i don't know. >> you don't think >> i'm not in the atmosphere. >> a remember of the kardashian clan has that impact >> not my world. >> in underscores a problem with snap, are young people really engaged in snap anymore? have they grown tired of it? is there growth there? do these kids -- remember snap's ipo, you remember this very well, their big thing was they were appealing to people who were like 11 years old i'm exaggerating but the very,

very young end of things so was this the audience that you want to begin with >> sure. >> i think this is a bigger move than we had on tuesday when citi went to sell on monday >> well, kiley jenner sell trumps a citi sell at this point. >> more influential than a citi analyst, there's no doubt about that another situation we're following closely because you've got a challenge for the entire boor board of directors from jeff smith starboard in alignment with franklin and former board member they did announce a board refreshment, interesting timing, right, three new independent directors, worth noting two of them are women, which is helpful. did want to mention that as well three more board members there at a company that has been under fire for some time and for which

we don't have a meeting date yet and there's going to be a pretty nasty proxy fight in the future trying to get ahead of it a bit. >> already, dow is up 204. let's get to bob pisani on the floor. he's not ready if you missed bullard this morning on squawk, maybe we can hear a bit of what he said about the path of interest rate hikes this year and what it would take for the economy to push the fed to hike quite that much. >> the idea that we have to go 100 basis points in 2018, that seems like a lot to me that's kind of priced for perfection, everything would have to go just right and economy would have to surprise in the upside a bunch of times during the year and i'm not sure if that's a good way to think about 2018 >> it was on those comments that futures really started to tick higher this morning. >> absolutely. when markets think about four interest rate hikes, that's a frightening spos inspect when

you look at fed fund futures and nowhere near that, nowhere in the cards here >> bob good? >> how are you >> let's get to bob pisani. >> this was a strong open, 5-1 advancing the declining stocks and the board looks a lot like it did earlier in the year when we were talking about cyclicals and growth look at the sectors, transports are strong, good numbers from avis, pulling up the transports a little bit energy is back, what a terrible performer in the last month but that's starting to look like it did earlier in the year. industrials are outperforming again, sick click lickal stuff and materials, all stuff that's leading consumer staples and more defensive stocks are lagging but still on the upside. so again, this is a cyclical looks like a cyclical story we haven't seen in quite a while. there was a lot of discussion about a wall street journal story this morning about the fact that a few stocks in the

s&p 500 are moving the indexes around and it's true amazon was about 27% of the gains in the s&p this year that does sound like a big number microsoft 13 and netflix is 8% this falls in category of statements that are true but not necessarily that interesting the s&p had very small gains, only up 27 points. so you have big gains in a few stocks that can move the index around very easily and this happens very typically in years when there's not a lot of movements in the index itself but there's a movement in the underlying stock so let me give you an example, if you look at 2015, the s&p 500 was only up 1.3% for the entire year if you look at stocks that influence it the most, you have amazon, which was 58% of the gains and microsoft which was 34% of the gains and general electric, believe it or not was 29% of the gains and you also had google as well, a and b shares, that was about 58% of the gains. this is more than 100% because

there was stocks that were negative that had a negative influence on it. so the important thing here is that you can have these big, big movements with small numbers of stocks in it in years when you don't have a big movement in the inde index. this is not unusual, i don't think people should be that concerned about it, it's happened for many, many years, the biggest issue is what's going on with interest rates and you saw the confuse questioned as the markets moved up initially on the fmoc report then everybody seemed to reverse themselves i think michael roork and number of people pointed out we had a structural change occurring in the last few weeks that started with the jobs report, a couple of weeks ago you have a stronger economy and you have now larger deficits with the budget and you have a fed withdrawing of liquidity and all of that translates into higher rates overall here. so the market is now taking the cues for rates which are looking at economic developments and i think that's the key factor and that's what we've got to get

used to. we're back to the situation where interest rates now matter and they are clearly starting to affect the stock market. we're sitting just off the highs for the day. we were up over 200 points earlier, up 174 right now. >> i'll take it, bob thank you, bob pisani on the floor for us one of the big stories as we count down to the annual meeting of qualcomm on march 6th, ten days from now, it is a tuesday if you want to check your cal e enders there the hostile bid from broadcom has been interesting and has some scratching their heads in terms of tactics and trying to understand it. somebody who has followed more hostiles than anybody over the last i don't want to say how many years, they are very tough to pull off and landscape is littered with failed attempts at hostiles by companies. will this be yet another one we shall see but coming into them you have to be prepared to pay a price that often times would seem to be far higher than you should pay if you want to be successful. that perhaps one of the reasons

why broadcom seems to be doing some strange things here in terms of tactically in terms of trying to win the day. the board meeting, the annual meeting is coming up and we'll get to in fact the broadcom so side in terms of ability to win the seats but really lowering the price yesterday and arguing it is a higher price, is that something that shareholders are going to buy into after of course qualcomm raised the bit for nxp. it's going out the door per share, we're lowering from 82 to 79 but really raising. okay maybe. maybe not. maybe you could have gone up to 78 or some number and gotten the meeting and gotten a little bit of engagement and then raise a bit more ceas easy to back seat drive or monday morning quarterback in terms of tactics the key is all about the vote. they are trying to focus share hoerlds and put a new deck out this morning, supporting their belief that hey, qualcomm is a

company that has not been managed well and not executed well and will continue to not execute well and far overstating its ability to earn money given the move from 4g to 5g because they failed in the past to take advantage of the similar kinds of moves a couple of things that they are sending out this morning for example, overall, they are a big argument, our stock has done better than your stock and there's no doubt about that when you look at the performance of broadcom over the last five years, only up 664%. qualcomm is down 8%. that is a picture that they will rely on many times and then they point out qualcomm's growth targets and revenues a why should you believe them a decline from 14 to 17 in terms of revenue growth and growth target they claim is far out of reach at this point. all of them reasons why you should in fact elect their six members to the board if you did, of course it would give them the majority and conceivably that majority would be inclined to negotiate

back to tactics, why go best and final? why raise only to lower? why condition the entire thing on taking control of the board of directors i got a lot of whys and shareholders may answer them when this vote comes up in ten days from now. melissa? >> it's almost like it's a deal that they don't want to happen at the end of the day. >> yet they do, he's a very -- he's trying to show discipline as a buyer that's hock tan and don't forget silverlake who may be behind part of this tragedy. >> it's not clear they know their way around a hostile. >> let's get to the bond pits and rick santelli in chicago >> good morning, melissa lee all maturities along the yield curve are a bit lower yesterday because they had little spikes of course right on the minutes look at the two-day of two-year, that spike took up to to 227 that's going to be an area to pay attention to but maybe more so for the longer

maturities look at the two day of tens, spiked up to 2.95 and that's basically a new high close going back to the end of 2013 when we had our 1/3/03 close and when the minutes came out, several minutes beforehand, we moved up a bit but then we moved down it wasn't for many minutes, you had as long as 15 minutes before the traction really began. and that traction to it the 2.95 may have played a role in the reversal tens minus twos, with short maturities being more prone to be moving higher and flattening the curve, in january we had the flattest curve going all the way back to october of 2007. what we settled at on the year to date chart, 52 basis points it's now at 65 steeper but as you see, the steepness seems to have slowed

down a bit all things being equal in my opinion, the steeper the curve gets, the higher the probability of more fed increases in 2018. now let's look overseas, tens minus bunds, after yesterday's activity, this thing shot above 2.20 we're looking now at the widest it's been in quite a while and the reason i find this so important is because when you look at it, it's doing two things in many trader's minds. the first thing it's doing is telling us that it's a shock absorber because the way trading works, the higher our rates go, if the rest of the world is specifically europe and others don't participate, it's going to create a shock absorber to bring in buying internationally. but the other thing is, it's also a policy exporter mario draghi and bank of japan really have to contemplate if that spread starts to get wider and wider how it's going to pull their policy potentially closer to ours. carl, back to you.

>> thank you, rick santelli. coming up, roku shares taking a hit on guidance but the stock soar eed since they went public five months ago. we'll talk to anthony wood lerat this morning we're back in a minute is the monolithic view of emerging markets obsolete? at pgim, we see alpa in the trends, driving specific sectors of out performance. where a rising middle class powers a booming auto industry. a leap into the digital era draws youthful populations to mobile banking and e-commerce. trade and travel surge between emerging markets. everyday our 1,100 investment professionals around the world search out opportunities for alpha. partner with pgim, the global investment management businesses of prudential. i thwell wait. what did you meetthink about her? it's definitely a new idea, but there's no business track record. well, have you seen her work? no. is it good? good?

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for more on today's movers, let's get to bertha coombs >> the nasdaq trying to avoid a four-day losing streak, but even with the losses that it's seeing this week, it's really outperformed the overall market. this morning what we're seeing is pretty much large cap, small caps, all moving together at the moment but take a look at the nasdaq 100. that's been the best performer if you look at where they are from their highs, look at how much better the nasdaq has done compared to the s&p 500 in its recovery here over the last couple of weeks. it's less than 4%, while the s&p and the overall market is almost 6% or so really, that's been about the large caps the large caps for the most part have recovered

you still have about a third of them in correction territory another 13% are actually in bear market territory these largest caps have done really well, particularly those f.a.n.g. names we talk about, including apple. apple, amazon, and netflix are all positive for the month, all moving in a more positive direction. of course, amazon hitting that $1500 yesterday was a big part of the recovery here back to you. >> all right bertha, thank you very much. we'll watch that action today as well dow up 113 at the moment ""squawk on the street'" continues after a short break. this is a tomato you can track from farm, to pot, to jar, to table. and serve with confidence that it's safe. this is a diamond you can follow from mine to finger,

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shares of roku down more than 19% takes you back really only to the beginning of february. we'll talk to the ceo anthony wood on the resus,lt guidance, and valuation when squawk on the street continues

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visit esd.ny.gov. welcome back to "squawk on the street". rick stantelli here we're expecting our first read on economic indicators expecting up 0.7 we are more. we're up 1%, solid number. that follows the last look we had in 2017 at 16. just to put it out there, october last year, we had a reading of 1.3 that was the best level going all the way back to 2010 indeed, these are solid numbers. last year did not have one minus sign in front of any of the

l.e.i. monthly numbers the response in the marketplace isn't very significant sometimes it never is, but we're still holding up above 2.90 in tens many traders and viewers keeping close attention to that level. >> rick, thank you very much good thursday morning. welcome back to "squawk on the street." i'm carl quintanilla with melissa lee and david faber. markets hanging in there a gain of about 134 as we're seeing action in a bunch of consumer names stocks surging higher as fed fears dissipate. the fomc giving the green light for more rate hikes to come. >> and shares of roku are down sharply this morning the company did beat on earnings, but it missed its forecast we're going to speak with roku ceo anthony wood in a little bit >> plus, tech's millennial problem. new data showing a drop in users on facebook. we'll dig through the report with its author and find out what it means for others >> for more on the markets, joining us this morning, wells

fargo senior global equity strategist good to see you both scott, i'll begin with you how much of this dance around the prospect of 3% is deserved and how much is overreaction >> i think really, carl, we're not looking for interest rates to move all that much higher we're not looking for inflation to move that much higher i think wage gains will be a little higher than they are. i think the fed will probably at the most hike rates three times this next year the market, there's a lot of uncertainty. it's going to make months until we get real clarity. those are the things that are really upsetting the market or concerning the market. i think it's a little bit of an overreaction it's going to pan out that the fed does not do too much in 2018 >> i saw you nodding your head does that mean value is being created here in the meantime or not? >> just on the bond discussion, i think what is really different from a couple months ago is simply the term premium here

it's here to stay. post-tax, the deficit's here that's something we haven't seen back in 2017 or before the inflation part of this discussion, i agree with scott there's so many factors that are going to weigh on inflation going forward. you're seeing that reflected in the forward inflation metrics. they have not accelerated here the bond -- i'm with scott on this i think we'll probably consolidate this 3% move there's a lot of talk about you have a 30-year bull run in treasuries coming to an end. the point i would make to that is that the process by which you declare 30-year rally over is a long-term process. you can't just peak above 3% a few ticks and all the sudden declare victory for the bond bears. it's a very -- it's a process measured in quarters, not in days and weeks >> with all that said, scott, at this point in time, what's your view on being fully invested, and has that changed tremendously since the start of the year >> you know, maielissa, it real hasn't

retail clients are underinvested in stocks. many have been underinvested for this whole multiyear run before this tax code change, before the year, we liked industrials, consumer discretionary, financials, health care. we like them even more after the new take code change given the fact that in our opinion you'll see about 2.9% gdp growth this year, things are going to be moving ahead the tax code change probably extended this expansion by maybe a couple years or something like that we want our clients fully invested we're trying to pick some technical spots suggesting they get in if we see them, which we obviously saw the 200-day moving average. wouldn't surprise me if we saw the 100, 125-day zone again. that's 26.20 to 26.55, something in there we want them buying on the way down they're sitting on too much cash i think we have more upside left before this is all over and done with >> a view like that, though,

implies that, michael, the fed is going to thread the needle perfectly, that they've got this figured out and there are going to be no missteps here they're not going to get behind the curve too much we're going to see the fourth rate hike jammed in there. what's your view on the fed's role in all this >> obviously, we have a new person running the fed, but i think the ecb also has to thread the needle perfectly that's almost a harder needle to thread perfectly than the fed's needle right now, particularly given where the short end of their curve is and the long end, how low it is. 75 dips on the ten year. what that means for our situation here i think the ecb is going to be much more gradualist for all this discussion about the central banks rapidly retreating, i think it's an aggressive assumption to assume the ecb is going to stop being gradual and suddenly sort of, you know, go to a qt next fall straight away. i think that's going to actually keep a lot of the old regime in

place. i think just on the sector, tech and emerging markets have kind of led the way out of this volatility dip we've seen. it's important to stress that, you know, the market dip we've seen, if the ten-year was at 2.5% and there was no noise about the vix squeeze, the price action we have seen given how overextended we were in late january, is completely to be expected >> wouldn't you then -- wouldn't you rather see a true washout in tech to suggest that you're at an investable bottom >> look, yes you're sort of -- you would love to see tech getting truly destroyed so you can really recapture the value, but i think one of the -- you know, everyone's been talking about the shift from growth to value one of the interesting dynamics here -- and you're seeing it reflected in the performance tech is kind of all weather. it can perform when the economy looks weaker you can see the correlation with ten-year yields. but you're also seeing it go the other way, right

in other words, in a higher interest rate environment where margins are more at risk, where there's more confusion about, you know, interest and all that, if they can grow earnings, that's going to continue to keep that dip relatively shallow. >> because we're talking big secular changes in the way we all live >> absolutely. >> scott, what's more important to think about, a retest of the 2.9 low or a revisit of the january high >> carl, i tell you, i think we're going to test to the downside here first. this confusion over the fed and inflation and what wages are going to do, higher wages are going to do potentially to margins, i think there's too much uncertainty right now i think we are going to test a little lower i don't think we're going to test a lot lower really, for me, in my opinion, to push below the february 9th low, which was the 200-day moving average, i think you need some kind of an event. now, if the fed said and gave more hints that, you know, hey,

we're going to do four or more hikes, we've argued for a long time that's a problem. four is too many jim bullard was on cnbc this morning. i agree 100% four is too many i don't think we're going to see that, but you know, certainly the biggest risk in my mind this year is that the fed makes a mistake, and a mistake would be four more. >> guys, good discussion thank you very much. let's check in with andrew ross sorkin at the went inter olympics in pyeongchang, south korea. a banner night >> hey, guys i want to tell you a little story. you're a fan favorite here here's the code. abfttb this is the motto of today's silver winner, one of carl's favorites, of the women's alpine combined mikaela shiffrin when she was young, she asked three-time olympian heidi to autograph a poster she wrote back to her, dream

big,my c big,my c big, mikaela, and always be faster than the boys that's now been a motto for mikaela. abfttb, always be faster than the boys another american woman coming up very big for team usa today, jamie anderson wins her second medal of the games, earning a silver medal in big air snowboarding that event is making its olympic debut here in pyeongchang. you got to see some of that air, which i know we're showing you now. not making its debut at the olympics, burton boards have been around for a long time. the company's ceo telling us that sponsoring the olympics is not so much about marketing her brand but supporting the growth of the support burton is largely credited with popularizing snowboarding in the u.s. since the company's founding in 1977 carpenter and her husband, jake burton, the company's founder,

own 100% of the company. carpenter told us why they'll never be seen at the new york stock exchange they never want to go public >> i look at the surf industry and what happened to the surf industry they all went public they all got greedy. they had to show, you know, constant growth when there really wasn't growth so they were just putting product out there. and it hurt the whole industry >> burton has an estimated 40% market share of the $400 million snowboard industry meanwhile, let's take a quick check on the medal standings norway has a healthy lead with 35 medals. germany, 25. canada, 24 usa, 21. netherlands, 17. we still got a chance to get up there with canada and germany. guys, some more good news. usa men have advanced to the gold medal match in curling. cnbc's favorite sport. after defeating canada, the usa guaranteed its best ever curling medal. the only other medal in curling

was a bronze in 2006 by the way, carl, since you're a twitter master, have you followed the back and forth between christie ally and her comments and the u.s. curling team have you seen that >> that i have missed. you guys on it >> i saw reference to it, andrew, but i actually admit i didn't click through to find out what it was all about. >> she goes on twitter, says curling is boring, and they basically go back and say, well, your movies are boring she deletes the tweet, and now says she's going to give it a second chance. these guys going for gold. we'll all be rooting for them. >> yeah, that's twitter. bringing people together all the time >> all over the world. andrew, i can remember years ago visiting jake burton up in burlington, vermont, where i assume they're still based that company has been able to sort of maintain, i guess, that significant market share for a very long period of time, haven't they >> it's an amazing story

it is now a husband and wife team as you said, they're a private company. despite all the competition over the years, to be able to maintain that kind of market share is something -- also, we should say over time private equity has come after them, others have wanted to buy them, and they have resisted you and i are always trying to play the m&a game. i don't think they're going anywhere fast. >> no, no. sounds like they got the right plan >> all right andrew, great to see you thanks a lot >> thanks. when we come back, shares of roku plunging after providing a weak sales forecast. the company did, though, report an earnings beat roku ceo anthony wood will join us next. another check of stocks this hour we had been strong at the open we've been giving up a little bit. dow up 181 points. s&p up by 17 the nasdaq iups by 0.6.

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you know what's not awesome? gig-speed internet. when only certain people can get it. let's fix that. let's give this guy gig- really? and these kids, and these guys, him, ah. oh hello. that lady, these houses! yes, yes and yes. and don't forget about them. uh huh, sure. still yes! xfinity delivers gig speed to more homes than anyone. now you can get it, too. welcome to the party. shares of roku sinking sharply this morning the company reporting an earnings beat but delivered a sales forecast that is not exactly wowing shareholders this morning. joining us now first on cnbc is roku ceo anthony wood. always nice to have you, mr. wood >> good morning. >> you talk about obviously running your business more or less at near break even on an operating cash flow basis for

this year while reinvesting gross profits in strategic areas that will drive growth for some reason, the market doesn't seem to like that. what do you tell them? >> you know, we had a really strong, fantastic q-4. for example, active accounts were up 44%, over 19 million active accounts. just to put that in perspective, you know, if roku were a traditional cable company, that would make us the number three distributor of content in the united states. just behind comcast and at&t our accounts are growing 44% year over year versus those traditional distributors being flat or down that's being driven by the large secular shift of consumers to streaming for watching television roku is the leading streaming platform in the united states. we're in a great position. we actually issued strong outlook for 2018, forecasting, for example, at the midpoint

gross profit to be up 56% year over year. so it's a great time to be in the streaming business roku is extremely well positioned >> all right well, all that said, why is your stock down 19% >> well, you know, the stock is up a lot since our ipo day-to-day stock trading is based on a lot of factors, but there's no doubt that we are at the center of a huge shift in television moving to streaming it's just a great position to be in we're just focused on building that business over the long term we have posted some great results ma results in q-4 and have a strong outlook for 2018 >> and it is worth mentioning your stock has been a very strong performer as well morgan stanley says they estimate daily hours streamed per active account decelerated is that the case is that something that concerns

you? >> no, our roku tv program is really coming on strong. it's a great position to be in, to be a partner with a viewer in the living room to control the home screen to help them find content. if you think about how roku builds our active account base, we do it by selling players, licensing players, and we do it by licensing our operating system to tv manufacturers last year, one in five smart tvs sold in the u.s. were running the roku operating system. that was up from zero four years ago. so it's a huge opportunity to be the software platform and the home stream of a television. we're excited by that. some televisions do start -- you know, sometimes consumers by a roku tv because it's a great television, not necessarily thinking about streaming sometimes some users start out at a lower usage of streaming, but there's a huge opportunity to bring them up over time as everything shifting to

streaming. players are doing great for us, but tvs are really doing super great. i think that's a great situation to be in >> sure, and i think that's what you've been emphasizing, that shift towards the licensing revenue as opposed to the hardware revenue, becoming more of a software company, to put it simply, versus a hardware company. the fact of the matter is, and correct me if i'm wrong, more than half of your revenue right now is still from hardware so people are taking a look at the device revenue decline year on year, seeing that decline, seeing the number of devices sold go up and are thinking there's real pressure on this side of the business, which is still a significant portion of your revenue can you walk us through the push/pull we're seeing between what's going on in devices and wether or not the growth on the software side will be able to offset the pressures in the hardware side. >> yeah, so our business is basically build active accounts, grow scale we grew that 44% in the fourth quarter. then monosize thoetize those cu. for us, we do sell players

it's a great way to acquire active accounts. but we're focused on selling more players, not generating hardware revenue we're focused on generating advertising revenue and content distribution revenue average revenue per user, which is the metric you use to measure advertising and distribution, was up 44% in q-4. that was huge growth play player revenue was down, but that's because we are focused on driving player units one of the tools we use is bringing down the price as the value of the customer grows. it's all part of our strategy. it's working well. >> anthony, we've asked you before about your appetite to get into the original content game you've been resistant to it. has your thinking evolved on that at all over time? >> we're a platform for distributing content one of our goals is to distribute all content available. so you know, we have no plans to

get into originals our focus is on helping our partners build audience for their streaming content as they shift their distribution from traditional tv to streaming. so we're focused on building tools to allow our partners to build large audiences. >> it occurs to me you have access to a l vabl trovaluable data how do you use the data that i would assume is of some value here that's growing all the time given your growing customer base >> absolutely. we're a platform for distributing content in the modern connected world using data is a key part of that we use data in a bunch of ways one is to offer a better experience for our customers, helping them find content they're going to like to watch also importantly, we use data on our ad platform. we have one of the largest streaming ad platforms in the business we have a lot of tools built into our platform for us to make money selling ads and for our partners to make money selling

ads. one of the ways we do that is bring a modern ad platform that uses data for targeted machine learning to deliver more relevant ads, measured ads and interactive ads. every ad on roku that we serve is a one-on-one ad targeted to a specific customer, relevant to that customer. that use of data allows us to get higher cpms than you would traditionally in the tv business for our advertisements >> can you tell us with any accuracy what the most popular netflix shows are? >> no, i can't tell you, but i'm watching "ultra carbon" right now, a netflix original. it's great >> got to check that one out anthony, thank you for joining us >> thank you >> anthony wood, ceo of roku when we come back, taking a page out of ge's book nsernited technologies coiding a sale dow is up 157.

now for our etf spotlight. our own dom chu is looking at a

sector that may have more room to run >> as things stand, the consumer discretionary sector is a bright spot if the rest of the sector reports as expected, we're going to see 9.7% earnings growth. that's better than the 5.7% growth that we thought before the season began sales will also be 6.2% higher versus expectations for 5% growth it might be one of the reasons why the sector has outperformed the broader s&p 500 since the recent record highs we've seen if you look at the spyder s&p etf, we're down roughly 5% the spyder consumer discretionary etf is down around 4% so slightly better and you can thank amazon for a large chunk of that since it makes up 20% of the overall fund and of course amazon sits at or near record highs at this point. this particular etf is often quoted because it is the biggest of the more retail-oriented funds with over 13 billion in

assets it's also market cap weighted. meanwhile, let's look at its smaller $450 million cousin, the spyder s&p retail etf, xrt it hasn't had the benefit of amazon as much it's a modified equal weighted fund that tries to give smaller and mid caps more parity as of yesterday, the xrt's top holding was shutterfly, believe it or not, with a 2% weighting netflix makes up around a 1.8% weighting. another stock to keep an eye on is home depot as it floats around that 10% correction area that traders talk about. it's the second biggest weighting in the consumer discretionary, xly, funds. it's got a 7% weighting there. as traders and investors take a view on retail, they're going to want to determine for themselves which index or etf is a better expression of their directional view or maybe a better hedge in their overall strategy so carl, certainly some names to

watch there. back over to you >> all right good look at the sector, dom thank you very much. utx may be taking a page from ge considering a breakup or asset sale that was once thought to be unlikely our morgan brennan covers that sector and joins us to explain what they may be talking about >> yeah, so united technologies is leading the dow higher today. it's up more than 2% really, this is on commentary that came from united tech ceo yesterday at an industrials conference, barclays conference, down in miami. basically, he said their main segments, aerospace, the elevator, the carrier air conditioner unit, that bit end of this year, they are going to e are view these businesses and decide whether they're more valuable together or broken apart. this comes on the heels of more reports about ge, which sals considering its own breakup, which i know david has been covering quite extensively but i think the bigger takeaway here is this is really part of a broader trend in the industrial

space. what they've said in many notes is the urge to merge the idea these big industrial companies with many different types of businesses, the sum of the parts may be worth more broken up and broken apart we are actually seeing that throughout the sector. there are a number of companies that are doing this. >> yeah. i mean, we spoke earlier about honeywell, which had been pushed by third point they did consider breaking apart to separate its aerospace business they decided against that. although, they are doing significant divestitures at honeywell. >> they're hanging on to the aerospace, spinning off two other businesses some of the other names, pent air announced plans last year. dover. you've got johnson controls, eaton. these are names that wall street would like to see go through

similar strategic reviews if they're not already. >> we call it shrink to grow remember, carl >> every other day >> yes, shrink to grow >> morgan, thanks. >> sure. >> anything else >> i was going to say, tax reform, i just had an analyst say tax reform is going to continue to push this cycle forward because m&a is going to become more attractive in light of that tax reform so this reshuffling of assets. >> an important point here is the companies that might not have considered spinning off or selling a unit in the past that didn't really fit because they had a large capital gain embedded in it, no longer are. the bar has come down. they're willing to consider doing it now given the lower tax rate certainly have heard that from a lot of people who focus on m&a in this area >> all right see you in a few minutes >> sounds good >> let's get over to brian sullivan with a news update. >> here's what's happening at this hour. president trump tweeting this morning that he will be strongly pushing for more comprehensive background checks, raising the age to 21 to buy assault-type

weapons, and ending the sale of bump stocks. this after meeting with students and parents who were gun victims at the white house yesterday afternoon. the spacex falcon 9 rocket was launched earlier this morning in southern california carrying a spanish radar observation satellite called pause. it makes radar images of earth for government and commercial purposes meantime in syria, hundreds of people gathering in the main square celebrating the arrival of pro government fighters they're there to defend it against turkey's military operation that has been ongoing since last month and hundreds of angry air france staff demonstrating at the headquarters in paris amid a strike over pay that has grounded flights the airline saying that half of its long-haul flights departing from paris will not operate today, so if you are flying out of paris -- that's our cnbc news update for this hour back to you. >> thank you so much, brian. let's go ahead and take a look at these natural gas numbers

coming out of the eia. we have a drawdown of 124 billion cubic feet this is a little steeper than expected a little steeper than last year an the three-year average as well natural gas is trading just under the flat line there. what's interesting is, remember, this is looking backwards. temperatures were colder temperatures have warmed up. certainly on the east coast. so demand is expected to see a little bit of a chilling effect this week. ironic there you can see nat gas is trading 2.66 back over to you. >> jark i cckie, thanks when we come back, tech's millennial problems may be getting worse. some new research shows facebook user activity dropping we'll discuss with the author of that report. and a quick programming note here, monday on "squawk box," becky quick sits down with berkshire hathaway's warren buffett. "squawk on the street" will be right back

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youtube says it mistakenly promoted a conspiracy theory video about a florida shooting julia boorstin joins us from los angeles with more on that story. >> melissa, fake news and hoaxes, as well as youtube's need to implement change is very much in the spotlight after youtube's trending tab, which showcases the most popular videos, featured a conspiracy video that attacked survivors of the parkland shooting. one video drawing over 200,000 views before it was pulled down. youtube saying in a statement, this video should never have appeared in trending because the video contended footage from an authoritative news source, our system misclassified it. youtube removed it from the platform as soon as it was aware. humans do help train the algorithms, which identify trending videos. the issue is not just one for youtube. after conspiracy theories started to circulate on twitter about the student survivors who have become activists, twitter has started to verify the

accounts of many of those parkland students. the company says it's working to stop the harassment of those students on its platform saying, quote, such behavior goes against everything we stand for at twitter, and we are taking action on any content that violates our terms of service. we are also using our anti-spam and anti-abuse tools to weed out malicious automation around these individuals and the topics they are raising now, twitter says while it doesn't explicitty ban the spreading of conspiracy theories or hoaxes, it will remove them or blockthose accounts if they violate twitter's other policy, such as anti-harassment rules. >> julia, thank you. sticking with social media, popular platforms are struggling to retain millennials. new research shows a drop in core facebook use. p joining us now is the lead researcher on that study brian, great to have you with us >> thanks for having me.

>> so it does look like at this point instagram and whatsapp may be carrying facebook, the broader corporate entity does that matter should we care that facebook core is declining if it does have this tremendous growth in the other areas? >> well, i wouldn't say they're carrying it because instagram is maybe one-tenth of the volume of consumption of facebook. to be clear. and facebook is 80% or so of total consumption of activities inside of facebook at least in the united states. whatsapp is more popular outside on a relative basis. instagram isn't as big internationally as it is in the u.s. so yeah, you do need to worry if you're an investor and looking at longer time horizons. not the short term but longer term to the extent that facebook's growth in share consumption is falling, that limits the ad inventory they'll have that produces a head wind on growth that's not the only reason that they're concerned. facebook does have pricing

power, but it is the core platform that is really -- should be the central element of any analysis of the business >> hey, brian. correct me if i'm wrong, but some of the nielsen data you were looking at is from late last year, prior to when facebook made some alterations to their feed. i wonder -- and engagement could drop what is this all about is it separate from that >> that's a good question, and one we don't know the answer to. the comments zuckerberg made on the earnings call, were they in reaction to consumer changes that were happening in the fall, or were they reflecting, you know, further changes to come alone? my guess is that there were people who were just leaving facebook they were spending less time on facebook to be clear, facebook is still growing its number of users in the united states, but it's the time per user. i think we've all been aware at least of the potential toxicity of facebook or the idea that, you know, you don't necessarily

feel good seeing comments that you maybe disagree with in a strong way at the same time, there may be people who are saying, i don't want to see all this fake news, i don't want to be exposed to this something was causing reduction in consumption for the data we have, consistent year-over-year data, starting in august, repeating in september, repeating in october, and again in november and december it may be they were implementing some of the changes zuckerberg referenced on the earnings call, but it's also equal i will possible they're making changes in reaction to changes in consumer behavior. to their credit, they're investing in the long term it may be that there's less consumption of facebook, but it is higher quality consumption from facebook's perspective. that's a good thing for the l g long-term business. >> brian, on that point, is there a clear correlation between time of engagement and ad spending? one of the reasons i ask is a number of investors who admittedly own the stock point out that the artificial intelligence tools facebook has

keep improving and advertisers are getting more for their money, so to speak, in terms of targeting, even if engagement may be flat or going down. >> right so in general, time and money, certainly when we're looking across media, will not be directly related it's ironic that facebook executive in india is making the argument that because there's more time spent on facebook than the ad share that there should be more spending going to facebook by that same logic, there should be a lot less spending on facebook in the u.s. i disagree with that premise because facebook is one of the least bet alternatives for advertising, it gets a disproportionate share it can be an effective platform for many kinds of advertisers. certainly it and google are on top. so just because there's a reduction in time spent does not necessarily impact the spending trends, but it does produce a headwind because it constrains the inventory they have available, unless they increase the ad loads dramatically, which i don't think they'll do

>> last question here, brian that's on snap i have to ask you about kylie jenner's tweet, which says, so, does anyone else notopen senatechat anymore, or is it just me? ugh, this is so sad. does this correspond with what you have been seeing in terms of snapchat's engagement levels and what has happened since the redesign >> yeah, and unfortunately, the data we have is only through november so far. so it doesn't tell us anything about the redesign i'd say this in general. we've seen complaints about platforms from consumers of those platforms for years and different media forever, i'm sure so it's hard to necessarily correlate that back to activity on the platform. all you can really do is look at snap and say have they been able to build a platform that's continually grown in terms of its use, users, time spent per user, et cetera. it's pretty decent, even though i have a sell rating on the stock.

i think they've actually done reasonably well in creating a solid niche platform if you assume they're testing and learning and getting the outcomes they want from those tests and they believe in where they're going, you negotiation i'd give them benefit of the doubt in terms of continuing to build a sustainable platform >> all right brian, we're going to leave it there. thanks for your time >> thanks. eanwhile, the fcc officially publishing its order to end net neutrality. the effective date for the repeal is now april 23 the new directive from the federal communication commission is expected to trigger a slew of lawsuits from states and interest groups. this is all now part of the process, it seems, as these rules begin to pivot, guys >> yeah, animportant move, one that perhaps hasn't received quite as much attention in certain circles as it has. certainly a benefit for companies like our own >> yes >> comcast no doubt about that. and we'll see what those challenges do in terms of delaying the implementation. >> as we go to break, take a look at shares of rovio, getting

hammered down more than 56% the angry birds game maker issues a profit warning, wipes off more than a third of the stock price. take a look at stocks at this hour, meantime closer to session highs once again. dow is up 211. "squawk on the street" continues after a short break. it's absolute confidence in 30,000 precision parts. or it isn't. it's inspected by mercedes-benz factory-trained technicians. or it isn't. it's backed by an unlimited mileage warranty, or it isn't. for those who never settle, it's either mercedes-benz certified pre-owned, or it isn't. the mercedes-benz certified pre-owned sales event. now through february 28th. only at your authorized mercedes-benz dealer.

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get this just a handful of dow stocks have managed to reclaim their precorrection highs. we'll reveal the names and if they're worth your money now on tradingnation.cnbc.com more "squawk on the street" coming up.

now let's get to the cme group in chicago, rick santelli with the santelli exchange >> hi, good morning. and thank you. i'd like to welcome my guest this morning peter, thanks for taking the time you write some op-eds that get me thinking. many of them, of course, about the gses, government sponsored

enterprises, fred gdie, fannie. the most recent i liked was the rogue treasury department turns towards the 1930s. what you bring up is that affordable housing is a nice moniker, but raft with negative issues as we learned in the credit crisis. what is happening today that surprises you at the treasury department pursuing the notion that many americans would like to see private systems for mortgages? >> yes, that's right this is quite amazing to me. here's the trump administration, which has been enormously successful with deregulation in all kinds of areas, and the economy is beginning to respond to that. then along comes the treasury department, which should be leading the charge on deregulation in the area of housing, they are not. they're going back to congress to work with congress on a new program that will have government guarantees of

mortgage-backed securities that's exactly the wrong way to go what we have done in the past has failed it has made mortgages and homes more expensive for people, especially low and moderate-income people >> you know, peter, let me interrupt you there. i see so many similarities between what the government tries to do -- and they try to do good things, whether it's student loans or mortgage finance. i just find that whenever a government gets in finance, the taxpayers always end up on the hook so i guess my first question is specifically, why would treasury secretary mnuchin agree with fha director mel watt that we want to go back to the same types of issues that were opened up in the 1992 affordable housing act that in my opinion was at the epicenter of the credit crisis >> you're exactly right. and i have no answer for that. in fact, it's puzzled me but one of the things we've noticed about the treasury

department is that they are willing to continue a lot of the regulation that was introduced by the obama administration, especially -- >> well, listen, on dodd-frank, what has the president said? when he was on the campaign trail, you know what i mean. what words did he use to describe dodd-frank? >> he said it was a catastrophe, a disaster, and it has to be repealed but the treasury department is going the opposite direction again. they want to increase the power of the financial stability oversight council, which is the heart of the dodd-frank act. so this is really a very puzzling thing to me it's puzzling to a lot of conservatives. why in an administration that is focused so much on deregulation we have a treasury department that is proposing to either keep regulation or increase it. and you're completely correct about what happened with affordable housing it was the cause of the financial crisis in 2008

>> i saved all the articles in my office. my favorite line was of course mr. barney frank, who said i will continue to roll the dice on freddie and fannie. when there were a few appear they all doubled down. and the final half minute we have here, are senators working on a plan? we only have a few seconds left. >> that is going the other direction? quickly, maybe explain that. >> it looked as though they were but it seems as though that idea has died the senators are going back to the government, back kind of system that unfortunately has caused so much trouble for our economy in the past. >> well, we're going to have to leave it there, peter. thank you. i want to let you know when anything new pops up in congress david, back to you >> thank you, mr. santelli let's send it over to jon fortt and get a look at what is coming up on "squawk alley. >> we're going to take a look inside a conservative effort to

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welcome back to "squawk on the street." legality's get over to bertha coombs and take a look at how the tech sector is performing all year >> it has been the tech sector today if you take a look at the -- well, we have all the sectors in the s&p in the green the tech sector not the biggest gainer but it continued to outperform the overall market. down 3% from january highs in no small part due to the nasdaq mega caps apple's recovery really contributed to the upside. apple up 3.5%. amazon taken out the all time high and cisco and netflix, 50% of the upside of the nasdaq 100. the gains have been more than offset by loss flz alphabet, microsoft, facebook, and comcast which combined account for about half of the nasdaq 100's 150 point loss so far month to date. but the nasdaq is up 300 points from the year and here's where

you really see the amazon effect amazon alone accounts for nearly 45% of that gain when you add in netflix, microsoft, and nvidia, you're talking about a very narrow range here because those four stocks account for about three quarters of the gain in the nasdaq it's not as easy to nickname as f-a-a-n-g. but we're continuing to see this real sort of narrow base of influence. and amazon here up looks like 27% year to date putting in that new all-time high continues to be the factor that seems to drive everything. back to you guys downtown. >> okay. thanks, bertha i'll take it one name we didn't get to this morning, the market cap is quickly eroding but worth mentioning is pandora. it's been a long time since shareholders saw a good day. today is yet another bad one if you own this stock down about 9%. this after reporting earnings after the bell yesterday listening hours, listening

overall coming down. people concerned about that. we have to go back to june when, of course, sirius/xm did the conversion $10.50 a share was the price doesn't seem like they'll be doing that any time soon, melissa, as we watch the stock's val eye contin value continue to erode. >> so it's getting worse and worse for them we're also watching shares of walmart. everybody in the home furnishing space, walmart.com announcing they're going to launch a new home shopping experience they'll have designer collections and this comes on a day when wayfair is con tending with their own problems. take a look at shares of wayfair. they're down sharply this is after rorecording a quarter as the lowest gross margins in their history the competition just continues to increase. the screws continue to tighten on wayfair as walmart's jumping

in now, amazon has been in, the home space so the competition is pretty fierce there >> seeing quite a few names with double digits 20% like declines. >> i know. >> on news >> big movers. >> something to watch. although, dow close to session highs, up 233. when we come back, a lot more on this rally "squawk alley" starts in a few minutes. don't go away.

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good morning it's 8:00 a.m. at amazon headquarters in seattle. it's 11:00 a.m. on wall street and "squawk alley" is live ♪ good thursday morning. i'm carl quintanilla