welcome to "street signs." i'm karen tso. these are your headlines >> italian deputy prime minister says he is not aware of delays to today's cabinet meeting where they will discuss spending targets, but amid the uncertainty banks trade lower. the fed hikes rates for the third time this year but president trump says he is not happy with the move as u.s. stocks end the session lower

>> my colleagues and i believe this gradual return to normal is helping sustain the economy to the longer-run benefit of all americans. h&m shares surge to the top of the stoxx 600 with improved inventory and says the level of markdowns will not increase again. and nafta negotiations stall after president trump rejects talks with canada's prime minister justin trudeau but ottawa says a one to one meeting was never requested. welcome to the show. we have a huge focus on italy today with budget proposals due out after the market close we have fresh data crossing. we have been seeking an improvement over the window of surveys for the last couple of weeks. we've had improved noise around fiscal discipline. just crossing this morning,

italian september manufacturing business confidence has risen in kind, it's 105.. that's above consensus where the market was seeking a 104.5 number we had a revised level for the month of august when we had a weak level that crossed. the number is now 105 versus the 104.8 level. there was some disappointment about the tone and how that was impacting confidence in the manufacturing sector the overall business confidence level is at 103.7, september verses a revised 103.9 in august that's still sliding and showing there's concern in italy when it comes to september consumer confidence of how main street is feeling, that's 116 and that is also higher than consensus

the revised number was also lower. that was 115.3 in august some improvement on confidence levels, which goes to the heart of what we're talking about today, what the coalition has been able to achieve the euro is on the back foot that reflects some concern what we're likely to hear out of the italian government let's go to markets. the italian market reflecting the market concern coming up to the event risk later on today. down 1.7% on the ftse mib. other markets are trading lower. the dax down 0.75% france off by a third of a percent. it magnifies the split between investors around the market. the ftse with still a lot of brexit noise and brexit uncertainty impacting the

market drifting down about 0.10%. the sectors on the boards this morning, you can see the banks are feeling the pain a lot of those names are in italy. down 1.4% the sector utilities drifting south the markets are weighing up the chances of more pressure on the oil price ahead of iran's sanctions from the united states retail also going north. a big factor was the h&m story about managing inventory and reducing the discounting taking place in its stores on high street let's come back to the big story. the italian deputy prime minister has shot down reports of a delay in his government's budget presentation and also denying he wants to get rid of the economy minister, but a report says the cabinet could delay the budget meeting today and also the economy minister may be considering stepping down

this is how italian bonds are performing there's been a slight march higher in the short end. up about 0.2 plus on the two-year the ten-year up 0.14 there's a key test of the market today with an action of bonds in the fives and tens before that budget proposal hits the italian banks, don't forget this cleanup process of the nonperforming loans, bank of bbm down selling across the board in bank stocks in italy. our colleagues spoke with the italian prime minister, and he says italy has a potential to grow >> translator: >> i had a positive meeting with blackrock. i'm interested in showing we're

serious what we're doing we're making structural reforms. italy needs structural reforms we need to intervene to invest in infrastructure, material and immaterial >> let's get out to willem marx for more on rome we have moved a long way because as the market tallied up some of the pledges from the coalition, initially one of the scenarios is that you would see 7%, and we've come back down to closer to 2%. what do you think the market wants to hear from the coalition? >> the key point is about stability long-term and having clarity over what the budget plans are for the future to be clear, we'll get a target for deposit debt and spending. quite how the mix fits into that one once the budget is released in draft form.

not entirely clear we heard yesterday from tria, the finance minister in rome, he talked about the fact that the universal basic income in some form would be included in the budget as would the able fility people to retire slightly earlier. la lega doesn't seem like they're quite so urgent in their demands being made of mr. tria for that lower tax rate to kick in he said again he expected a lore tax rate for businesses, but the ones for italy would not start until the following year so far mr. dimaio's demands seem to be front and center we heard from the economy spokesperson in the last hour or so that these reports in major newspapers here that mr. tria was considering stepping down

were "fake news" and they had no formal communication that a cabinet meeting to discuss these targets being released today had been postponed >> thank you very much for setting the scene. joining us now to talk more about the fixed income side is kiara cranessa, a fixed income strategist let's start with how we're facing a situation in italy where communication has been stilted from the coalition we had fantastic noise where it seemed like rome had got the market message loud and clear, and then the meeting today and suggestions that there may be some delays what do you want to hear >> we are seeing the baseline scenario that the budget deficit is coming close to 2%, but we have to acknowledge over the last few hours headlines suggest that the pressure is on, and

that it might be more towards 2.5% our baseline scenario remains close to 2%. a number close to 2% means there's got to be no deterioration in the structure budget, which is what would be a welcomed event for the market. >> there's a big gap in the numbers. initially many big investment banks are trying to crunch out proposals and what they would amount to. some of them the highest level got to about 7%. that's quite a different number to what we were talking about today. that means that there must be a lot of sacrifices in the initial proposals which then puts into doubt the ability of the coalition to stay together, which brings further market risk into the equation what should the coalition try and toss out what should it try to keep in terms of those budget proposals to try to keep the coalition together >> i think the markets were prepared for this. the coalition has always said

the measures that have been taken in steps or the measures with the government were in concert. i don't think the market expects to see all the measures that were in the government contract. they prepared that it would be a step by step approach. this is what it will be. they will have the first step towards citizenship income, a first step towards flat tax and the first step towards reform of the pension system >> today is quite a day in the sense that the market is waiting for this budget proposal to cross after the market closes later on in the interim we have a window of trading around the fixed income side. there's paper of five and ten-year bond auction that tallies up to 3.75 billion euros. it's a huge amount of paper sought how do you think this is likely to go? investors are somewhat skittish today in the market. >> i think it's not a huge amount compared to what it is

normally it's a fairly light amount, the treasury probably did it because they knew this was the big day of the announcement. so i think because it's a modest amount and there are no new benchmarks, probably this is the lighter option and it may also be well received by the markets, despite the volatility this morning. >> where is the appetite along the curve? if you look at the reaction today of the short end, the market saying we have concerns of what's coming out of rome today, let's push up the two-year, when we talk about twos, fives, tens, where is most of the appetite? is it further down the track is there more concern about the short-term than the long-term? >> i would say if we expect a moderate outcome out of the budget, i think the five-year is cheap on the curve and in the case of a deficit

close to 2%, we would buy the five-year versus the two and the ten. that's where the most pressure was in august. so if we get a moderate budget, the appetite will be probably there. >> thank you very much for your perspective today. h&m shares have rocketed to the top of the stoxx 600 after the fashion retailer cited an improvement in its inventory the firm also said marked down levels would not rise again. pretax profits did miss expectations falling 20% due to issues around the implementation of a new logistics system that it hopes will be a one-off. stay tuned for our interview with the former euro group president, jeroen dijjelbloem. that's after the break

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donald trump signaled their intent to sign a big and ambitious trade deal after brexit that's according to downing street which says both leaders view britain's departure from the eu as a wonderful opportunity. may and trump met on the sidelines of a u.n. summit in new york after the british leader defended the brexit vote in her keynote speech. the labor party leader will warn of the dangers of a no-deal brexit when he meets with michel barnier later today. delivering his keynote speech at the labour party annual conference in liverpool he reiterated calls for a general election and said that labour would vote against any government brexit deal that did not meet his party's key demands. let's get out to joumanna bercetche for more at the european banking summit in brussels a lot on the agenda there today. >> absolutely.

one thing is the murmur, lots of talk about consolidations going on, perhaps 2019 could be the year where we see the cross-border mergers take place. another topic is that of brexit and the impact it will have on the european financial industry. i have a special guest with us in the form of the former euro group president, jeroen dijsselbloem i was listening to your keynote speech lots of interesting points raised there the first thing i want to ask about is brexit. we are getting close to crunch time there doesn't appear to be any clarity inside financial services what impact is that having on the european financial system >> i'm worried about the outcome of the brexit process. we seem to be heading to a no deal situation if the trade deal is worse, the more impact there will be on the

financial sector and relations between the city and the eu. the city is still very important to the eu. i'm worried about the disruption that will come from that in the short-term i'm also worried about the longer term prospects because we don't have well developed integrated capital markets in europe on the continent. the pace we're putting in to develop those that should be picked up. >> do you think because of brexit the european system as a whole will be more incentivized? >> i hope so some years ago we started the project of the capital markets union, but the urgency slipped and the commission or the next commission will put that at top of their agenda again. to develop those capital markets, fully integrated, create more of an equity culture in europe. i think that's crucial for the character of our economy, it's crucial for the way that we invest and bring capital to

europe, and also for the bad times how we absorb shocks equity culture is something that is badly needed. >> when you look at the broader sector, european sector this year, financials have done very, very poorly, especially when compared to u.s. counterparts. profitability continues to be an issue in europe. what do you think needs to be done what will change the system? >> the key factor in europe is that we're still overbanked. we're overbanked in the sense that the economy depends heavily on bank loans. also because we have simply too many banks so there needs to be a shakeout. doesn't sound friendly, but that's the way it is >> we've seen domestic consolidation. some measures in italy where do you envision that happening? >> basically all around europe we have over 6,000 banks in europe small, medium, large banks some people are talking about merging or takeovers of the big

banks. but if you want to shake out and reduce cost levels, create more lenient banks we need a shakeout at smaller banks it's crucial for service levels, crucial to reduce costs and to create some scale that addresses the economic issues. >> just to pick up on that point, do you not think that cross-border merger activity will be a key focus for 2019 >> i think we'll see more of that it's important that national supervisors are being restricted by the european supervisor they cannot go on protecting liquidity inside national borders, they cannot go on protecting national banks. some banks will have to go liquidity has to move around in order to facilitate a process badly needed of scaling up the

banking sector and reducing the very high number of banks. >> when we talk about the european financial system, one topic that comes up a lot is that of risk sharing versus de-risking if you look at italian banks today, a good amount of de-risking has taken place yet we are not any closer towards this concept of risk sharing, the european deposit insurance scheme who needs to cave. >> so there is a lot of risk sharing going on we set up the banking union. we have a joint resolution fund. we have the principle of bail-in which is also about risk sharing. but the deposit insurance scheme is very important. it needs to be the last leg, the last pillar of the banking union. being quite honest i think in terms of risk reduction the last couple of years have been so successful that we need to put egis back on the agenda it's not popular in the netherlands or

germany, but to be fair there is so much work done on risk reduction, time has come to strike a deal on a common european deposit insurance scheme >> do you think time is more crucial given the volatility we see in italy these days? i was looking at a chart from deutsche bank showing there's a 95% correlation between italian bank performance versus sovereign bond performance you can't really say that the banking system has delinked from the sovereign system yet >> certainly not in italy. though italian banks have started to reduce exposure to their own sovereign. after years in which it only increased. that has started it will take many years to come. i think italy is a case in ir itself the italian will have to save italy. the markets won't do it. europe won't do it italians need to at thes theirdr

own issues we are losing time, that's a scare xh scarce commodity in italy. >> we have to leave it there we heard from mr. jeroen dijsselbloem, italy has to help itself >> joumanna, thank you very much for that interview strong comments there on the cross border activity required to sure up the banking system in europe. president trump has rejected a request for a one to one meeting with justin trudeau saying he is unhappy with nafta talks. but trudeau's spokesperson denied the statement saying no request was made for a meeting speaking in new york, trump said canada continues to treat the u.s. badly >> we're thinking about taxing cars coming in from canada that's the mother lode, that's

the big one. we're unhappy with the styles of canada we don't like their representative very much i love canada, by the way, i have so many friends there but that has nothing to do with this. earlier at a u.n. security council meeting, president trump accused china of seeking to meddle in the midterm elections because of his stance on trade >> regrettably we found that china has been attempting to interfere in our upcoming 2018 election coming up in november against my administration. they do not want me or us to win because i am the first president ever to challenge china on trade. we are winning on trade. we are winning at every level.

we don't want them to meddle or interfere in our upcoming election. >> china struck back saying some politicians thoughts are ridiculous and said china does not interfere in internal affairs. beijing also emphasized the economy would not collapse under u.s. threats u.s. and japan agreed to enter trade talks allowing japanese automakers to duck further tariffs for now. let's get more with makiko utsud utsuda >> yes japanese prime minister abe met president trump on wednesday and agreed on entering bilateral trade talks. tokyo had been resisting washington's push for bilateral trade talk force almost two years, but with the economy heavily depend dent on ant on e

abe was forced to reconsider the leaders said their countries will open into negotiations for a united states/japan agreement on goods and both countries will refrain from taking measures against the spirit of this joint statement. and japan said they understand those words to mean the u.s. will not impose its threatened 25% tariff on japanese auto imports as long as negotiations are under way. for now japanese automakers are protected, but risks remain as the u.s. is pushing for an early conclusion also another issue is that the japanese yen is undervalued, and the u.s. may say that the japanese yen is undervalued though it did not come up in the

discussions this time. that's all from the nikkei, back to you >> thank you very much for that update. coming up, president trump says he is not happy with the fed's decision to hike interest rates. find out why after the break people tell me all the time i have the craziest job, the riskiest job. the consequences underwater can escalate quickly. the next thing i know, she swam off with the camera. it's like, hey, thats mine! i want to keep doing what i love. that's the retirement plan. with my annuity i know there's a guarantee. annuities can provide protected income for life. learn more at retireyourrisk.org annuities can provide protected income for life. with tough food, your dentures may slip and fall. new fixodent ultra-max hold

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welcome to "street signs." i'm karen tso. these are your headlines italian deputy prime minister luigi dimaio says he is not aware of anydelays to today's cabinet meeting amid the spending plan. the fed hikes rates for the third time this year but president trump says he is not happy with the move as u.s. stocks end the session lower >> my colleagues and i believe this gradual return to normal is helping sustain the economy to the longer-run benefit of all americans. h&m shares surge to the top

of the stoxx 600 with improved inventory and says the level of markdowns will not increase again. and nafta negotiations stall after president trump rejects talks with canada's prime minister justin trudeau but ottawa says a one to one meeting was never requested. let's take you to some of the european indices we are positive on the ftse 100. we were trading weaker, but we have moved out of the wed inredo the green on that market the rest of the markets have been weak at the start on the italian market we were trading down about 1.7%, now we've trimmed some of those losses, but the market moves coming up to the budget proposals, and we'll see whether

they can hit the budget targets the markets want to see. trimming some of those losses, the french market has been more supported, but trading lower by 0.20%. looking at the foreign exchange market, euro has been on the back foot coming up to this risk event out of italy later on today. we are now down about a quarter. not as bad as the earlier picture. the dollar is slightly weaker to the yen. we are seeing weakness in the pound. we are down 0.4% supporting the ftse. we have elsewhere to the yen, we are also seeing it drift south in the pound versus the japanese yen. >> u.s. futures this morning let's look at how the markets

are chasing the open another weak start today yesterday we saw some softness particularly around the dow. those markets looking slightly softer before the start. the nasdaq is chasing a slight gain the nasdaq is on pace for the first quarter since 2017 a bit more green on the boards there the fed lifted growth expectations for this year and raised rates by 25 basis points. the move was expected and the central bank projects one more hike before the end of the year and three more in 2019 policymakers dropped the word accommodative from the statement. steve liesman has more. >> reporter: the federal reserve raising interest rates to a new range of 2.25% and signaling another rate hike by december. jay powell was clear why the fed

is taking this action. >> our economy is strong growth is running at a healthy clip growth is running at a healthy clip unemployment is low, the number of people working is rising steadily, and wages are up inflation is low and stable. all of these are very good signs. >> fed officials on average forecast rate also rise another 75 basis points next year and finish above 3%. but powell also said there are risks out there to raising rates and risks to not raising rates if we move too quickly we can snuff out a recovery and inflation falls short of its 2% target or if we move too slowly, we have an economy that can overheat that's happened through history, we don't see any signs of that now, we're always trying to navigate between those two and we think that gradually, you know, raising interest rates is the way that we take both of those risks seriously. >> powell did not seem overly

concerned by high stock market values or high corporate levees, though he said it represents some risks as do tariffs but that has yet to show up in the economic data. overall powell said these are good times and by nudging rates higher and keeping them at low level when they stop, they can let the good times roll a bit longer steve liesman, cnbc business news in washington. president trump repeated he's not happy with raising rates. responding to the fed's decision while giving a press conference in new york, trump soughted there were other ways to use money from the improving economy saying i'd rather pay down debt or do other things to create more jobs. joining us is sebastian valle from deutsche bank we saw out of the fed noises that were pretty much in lockstep with what the market anticipated. and also the pace of rate hikes for 2019 and 2020. what jumped out to you at the meeting? >> i think there's nothing that

stands out as expected, the fed is on a gradual hiking path. they removed the reference to monetary policy being accommodative. they are on a steady path unless one of these macro risks materializes, but there are little signs of that happening >> which is interesting. globally you have an element of a slowdown, and investors have been nervous about howthe trad spat plays out you are not seeing it on main street in the united states just yet. but economists tell us it's only a matter of time it could be around the midterms or slightly after where you see that impact hit. is this one of those reports that until we see it come through on the data and we hear the fed respond, there's nothing to see here? >> i think you've right. the story of this year so far is europe slowed, china slowed, but the u.s. held up well. in the second quarter we had gdp growth of 4%, a tremendous rate. very little slowing in the u.s

one concern that we pick up among investors is when will the next u.s. recession start? we have a long recovery. our models suggest that typically that's only happened when the credit cycle starts slowing sharply, which only happens when the fed is in full blown hiking mode, which happens when they raise rates 200 basis points per year. so far they're raising 100 basis points per year. >> we know when we come into 2019 there's a feeling that some tax reform still lus mamulus ma, will there be an ability for the fed to hike three times in 2019 without cooling the economy. >> there are three points here, first is the leverage. business leverage is back to where it was during the peaks. the consumer leverage looks

good balance sheets for households are strong the second point is the trade war clearly if we got a major shock that would change the trajectory as we said, this is not the case yet. thirdly is fiscal policy should be supportive in 2019, and only start slowly rolling over and being removed in 2020. in the near-term there's nothing concerning in the economy. want to jump in on oil, which has crossed the wires. the market is sensitive around suppl supply >> we have comments from saudi arabia saying they're planning to boost oil supply by 200 to 300 barrels per day. 200,000 to 300,000 barrels per day, sorry, over the next few months this is a strong comment crossing the market has been wondering if there's the ability for the

saudis to do so. they also on the wire are saying saudi arabia discussed possible increases last week. so the market this morning supporting that brent and wti price. we're up 0.9% or 1% roughly on both of those trades let's push on and talk about what we're seeing across the banks. ecb reportedly picked three candidates to run the eurozone's banking supervisor according to several media reports t has short-listed islands deputy assistant bank governor, sharon denmary and andrea enria and robert ophele

>> numura has bought a stake in julius bar the ceo of julius bar said the deal was a major milestone in the japanese strategy. perhaps we can pop up a chart of how the european banks have fared of late. we have seen a pullback since the start of 2018. you say there is a link to improvement in the european pmis why do you think now is the opportunity to get back into those banking exposures? >> that's an excellent question. what we learned this year and what is showing up in the data, the main determinative of a european bank's performance is change in growth momentum. at the start of the year it was rolling over sharply immediately banked underperformed by 20%, but the growth momentum is troughing now. it has upside over the coming months, why? because the credit cycle is

improving, the drag from the euro is coming off and you have a more favorable inventory cycle. if the economy develops, as we expect, that would suggest 10% outperformance for banks over the coming months. what do we look at specifically at margin expansion or improvement from the negative deposit rate and also whether there be credit demand are those the elements we look at >> there are two main things to look at. on the credit cycle by far the best gauge is the ecb bank lending surveys. the most forward looking survey. for the first time in two years we have seen an easing in credit conditions, which is associated with an accelerating economy the second is the pmi. pmi has fallen by 4 points at

the start of the year. it started to stabilize. our model suggests it will be one point higher by the end of the year >> we can't talk about banks without talking about consolidation. every hour there's a new report crossing from a different source that there's a deal in the works involving a number of banks. we just spoke to jeroen dijsselbloem, he was talking about the fact you can no longer have liquidity around national borders, you need to think about moving liquidity cross-border and having consolidation take place. do you think it will happen? are we just talking about whispers or do you think consolidation is happening with dealers and brokers? >> it's certainly a possibility. it's not essential for our call. we're looking over the next six months, and i would be surprised if consolidation played a major role >> because there's too many barriers to cross? >> these are typically long-term projects it takes a while for them to be realized over the next six months, two questions are important for the banks. will the growth momentum

improve, and then a nice secondary driver, will bond yields continue to rise? we expect at the start of the year they would fall in response to the slower growth momentum. now if growth momentum improves, core inflation picks up and central banks are withdrawing consolidation, that's consistent with higher bond yields. >> you also got a call overweight european mining, this does suggest an overall pause on markets that there won't be a turn coming. the markets have been nervous about some form of correction, and that would spill across to the european markets why are you so positive we're in this upward cycle for stocks >> i have to say we're neutral on the european market we have a flat market over the coming months, partly because a pick up in core inflation is typically associated with a rise in rear bond yields, which is the discount rate for equities if that comes up that puts

pressure on multiples. we only have a flat market partly because of that higher discount rate, but we like the european banks as a function of the growth momentum in the bond yields the mining play is related to a very different dynamic, mainly about the chinese economy so we're seeing now investors are incredibly nervous about china credit growth slowed to an all-time low the equity market has fallen by 20% and you have the overhang from the trade war we disagree. we think chinese growth momentum will be stronger by the end of the year why? the main driver of the economic cycle in china is the credit cycle. clean that just eased money tash po monetary policy which should lead to a stronger chinese economy and that should be good for mining >> what about overcapacity is that not an issue >> i'm a fan of looking at the data the last 10 years, 20 years and say what has driven trade? there's one driver, copper

what is driving copper is chinese groewth momentum in the dollar >> interesting call. thank you for that coming up on the show, judgment time for brett calka c kavanah.ug [ digital voice ] i used to be one of the world's most feared hackers. my friends call me "hack daddy." [ evil laugh ] but then cdw orchestrated a network transformation using cisco digital network architecture. allowing scalability and providing fast, comprehensive security from intruders like me. luckily i found a new calling. faster. security transformation by cisco. just run. run like you know how to run. it orchestration by cdw. ♪ man: are unpredictable crohn's symptoms

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a third allegation of sexual misconduct has been leveled against president trump's supreme court nominee brett kavanaugh. it ramps up the pressure on the judge ahead of today's testimony. trump, who continues to back kavanaugh hit back at the woman and her lawyers but stopped short of calling the accusers liars. peter alexander has the full story. >> reporter: tonight president trump defending his supreme

court brett kavanaugh and blaming democrats for orchestrating partisan attacks >> they know it's a big fat con job. >> reporter: the comments made by michael avenatti who also represents stormy daniels. >> you have this other con artist, avenatti come out with another beauty today these are false accusations. >> reporter: in a sworn statement julie says she witnessed kavanaugh fondling and grabbing girls without their consent saying in 1982 she was the victim of a gang or train rape, she does not blame the judge for being involved in the rape but says both were strength kavanaugh said this is

ridiculous and from the twilight zone avenatti tease his release of the accusation for days. avenue n kavanaugh asked about it earlier this week. >> did you ever par tig >> did you ever par tigiecipate or were you aware of any gang rape of a party that you attended >> that's false. >> reporter: today avenatti would not make her available for an interview >> here's what i think he went to a party once and people were drugged. >> reporter: it comes before tomorrow's dramatic scene in the senate republicans hiring veteran sex

crimes prosecutor rachel mitchell to handle questioning today's ford's lawyers releasing the results of her polygraph test where she wrote down the details of her allegation and asked if any of it was fams. >> i'm confident dr. ford was truthful. >> reporter: polygraph tests are generally inadmissible in court. kavanaugh wrote i said and did things in high scahool that make me cringe, but i never did anything remotely resembling what dr. ford describes. peter alexander, nbc news, new york major tech firms backed the introduction of data privacy laws at a hearing on wednesday however representatives say they want a national approach not a 50-state approach to data privacy. lucy green is author of "silicon

states" and she joins us now arjun kharpal is on the set, too. we heard about this hearing on capitol hill if there is an approach where there is a breakdown by state with different rules in place, that would almost make america the equivalent of what europe has at the moment, where we're trying to have one approach across jurisdictions how dicey is this situation for tech companies in silicon valley >> i think it's important for them to act pro actively it does seem like government and legislation in multiple regions are zeroing in on them what's clear is there is rising awareness of the need for legislation to catch up with this fast moving space and that more and more areas of consumer

data are being recorded that people really don't have much awareness of there needs to be more up to date legislation to effectively inform consumers and more transparency and more effective ways to regulate >> it's arjun here in the studio, i wanted to ask about the sense you got from yesterday's hearing, whether the politicians have any idea of which path they want to take when it comes to legislation around data privacy. we've seen the gdbr in the european union come into effect. there was a lot of praise of that law from some politicians, even though we know it's imperfect. from yesterday's hearings, what you heard, is there a sense of what we might see out of the u.s. >> i think today there's not much sign of it getting better, that the legislation around this kind of stuff is still very imperfect. it's an entirely new frontier and it's changing every single

day. especially when you look at the committees and the way the companies are questioned, there's a lack of tech literacy, not just in the senate hearings, the congressional hearings, but in the questioning of whistle-blowers. there is an issue within government bodies trying to define legislation and what happeneding what n happening. >> you talked about big tech and the influence they can have. something that came to me is the amount of data sharing between the major players, the likes of facebook, google and amazon. you get the sense that they're collecting data and sharing with other third parties, but with each other that gives you the sense of how powerful these companies are and the influence they can weald

>> that's right. there's been discussion in the jeff sessions listening session as well recently about how antitrust laws could be applied to this. when you think about it, data is almost like the new oil. so when you have these massive data sets combined with apple buying shazam or facebook buying whatsapp or instagram, you are having these companies acquire massive new data pools and another area that's not getting talked about much is the dating apps, like match.com. when you layer on top artificial intelligence and the ability to analyze that, really it presents a huge amount of power, like the census on steroids these companies have become the intermediaries to the human experience of life that will only continue with visual

recognition, sensors, the internet of things in the home and everything being connected that puts these guys in a powerful position in terms of understanding and potentially being able to manipulate consumers. >> thank you very much for your time today >> thank you >> thank you very much to arjun as well. let's look at how the u.s. market is setting up for action today. futures are mixed. slight green on the nasdaq that is all for today's show i'm karen tso. "worldwide exchange" is up next. stay tuned your brain changes as you get older. but prevagen helps your brain with an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. healthier brain. better life.

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. it is 5:00 a.m. in boston. here's your top five at 5:00 president trump sounding off on everything from nafta to china to the fed we have a full wrap up of his comments coming your way. the fed just raised rates and signaled more to come. opec reportedly ready to add more oil to the market to calm fears as crude and gasoline near four-year highs. bed bath & beyond, ouch. shares plunging there following an earnings miss. and all you gamers out there, rejoice there will be a lot of tired kids in school today you know why