it is 5:00 a.m here is your 5 at 5:00 pushing higher wall street rebounding this morning as investors await a barrage of earnings reports. the big names you'll need to watch. the business backlash. we're live in riyadh with the latest there. google says it is still eyeing a censored version of its search engine in china. and we have a $2 billion deal in the cloud to tell you about. and the business community

remembering the life of microsoft co-founder paul allen today. it is tuesday, october 16, 2018. "worldwide exchange" begins right now. good morning welcome to "worldwide exchange." i'm dominic chu. brian sullivan is on assignment today. let's get you up to speed on the market action. you're seeing green, it's not strong yet but better than yesterday. the dow would open up by 27 points the s&p by 5 the nasdaq by 29 on the treasury side of things, just a little bit of action in the ten-year u.s. treasury note. 3.17%. so a slight tick higher. the two-year note yield, 2.87% now, turning overseas. we are seeing action in asia as well you can see there that the nikkei in japan, 1.25% gains there helped along in part by a stronger u.s. dollar and a

weakening japanese yen better for their export economy over there we're watching the shanghai, off by 1%. hang seng in hong kong flat on the day. on the european side of things, a bit of that risk on trade happen though just fractionally speaking the dax is up by a quarter of a percent. the cac in france, the same percentage the ftse 100 in the uk off by a quarter of a percent as for the broader market, you have oil prices on the move. right now wti crude down by a half percent $71.31 comexgold, up by 0.2%. euro versus the u.s. dollar, 1.1585 bitcoin just about flat, $6,439. joining me is talley legere.

is this time maybe to get back into the markets >> one key thing that investors should look at is inflation and interest rates it's the combination of the two. clearly we've had cyclical upward pressure on inflation but not the same thing as saying we're on the leading edge of a runaway wage inflation, breaking the back of the economy. >> is it fair to say then given your views on inflation that you believe interest rates are the primary driver of the market as we stand right now >> i think clearly interest rates have and do matter but the reason why they're going up, i think, is key. if it's inflation, that's bad for stocks i don't think that's the problem right here if it's because of real growth expectations, it's good for stocks and the earnings channel.

that's the best case here. >> we've heard the argument before prices are going up. inflation is good for some reasons. if we believe that, is there something in the realm of economic data that you're looking at, the cpi data, the ppi data what gives you the idea that this could be the good type of growth or inflation? >> one thing is very clearly i'm just not seeing economic recession in the cards right here right now the yield curve is still technically positively sloped. that gives me reason to expect the expansion to continue. if fundamentals like sales and earnings remain intact, it could be a buying opportunity. >> if this is a buying opportunity. we've seen all kinds of weakness in multiple pars of tparts of t, where would you be hunting for value right now?

>> if you agree the cycle continues in the u.s., i think you want to kind of dip your toe in some of those more economy sensitive sectors including technology that have been beaten down here. bottoming is a process the pullback in february took months markets don't inflect in v-shaped formation >> cyclical stocks, those sectors, some of the ones you think will prosper talley leger, thank you for joining us. google says it is still considering launching a censored version of its search engine in china. bertha coombs has the detail >> the most extensive comments on the company's plans for that censored search engine speaking last night in san francisco, they say google is taking a long-term view about

the country. the search engine code named project dragonfly was first reported this summer by the intercept, that generated a backlash including the resignation of some google employees. the chief privacy officer testified before congress last month talking about the project. google wanted to get an understanding from the market from all angles. >> when it comes to china, given our history, our intent was, the reason we did the internal project -- it's been many years we've been out of the market it's a wonderful, innovative market we wanted to learn what it would look like if google were in china. if google were to operate in china, what would it look like what queries will we be able to serve? it turns out we could serve 99%

of the inqueryqueries. >> it's not the first time google would attempt to provide information. they previously were in china but pulled out in 2010 they have not decided whether google will launch project dragonfly but only went ahead with the idea after much deliberation he says if they relaunch in china, the biggest competition will be from baidu they are wondering how to thread the needle here. >> it also speaks to philosophy and technology these days is front and center, especially in china. thank you for that update. witrilio is buying sendgridn a $2 billion all stock transaction this comes as larger effort by the cloud software company to boost its suite of

communications tools the deal is expected to close in the first half of 2019 the business community today is remembering the life of microsoft co-founder paul allen. he passed away yesterday after a long battle with cancer. allen created microsoft with his friend, bill gates the two met while attending private school in the seattle area allen left microsoft in 1983 to devote his time to philanthropy, space and tech ventures through his investment firm vulcan inc he owned the portland trail blazers as well as the seattle seahawks he could be seen at game there's all the time bill gates releasing a statement saying i'm heart broken by one of my oldest and dearest friends, adding personal commuticommut computing would t venoha existed without him. paul allen was 65. my - americans 50+ driving 7.6 trillion dollars... of economic activity every year.

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past anything that stands in its way. ...well almost anything. leave no room behind with xfi pods. simple. easy. awesome. click or visit a retail store today. we're following a developing story out of the middle east mike pompeo arriving in saudi arabia a short time ago. this as questions mount following the disappearance of journalist jamal khashoggi we have all sides of this story covered. hadley gamble is standing by for us in riyadh let's start with tracie potts live in washington, d.c. >> the secretary of state has been sent to riyadh on a mission by trump the president says he is there to find out what happened to khashoggi and also what, if

anything, the saudis knew about what happened to khashoggi it's interesting because now sources are telling us that the saudis may be ready to admit that they are aware that he died inside their consulate that it was a mistake, that it was an interrogation gone wrong. earlier they said they didn't know anything about it but they also said they believed he left the consulate alive. mike pom fay peo this morning i saudi arabia trying to get to the center of that and president trump now urged to discontinue weapon sales to saudi arabia until this is all worked out, and saudi arabia threatening to raise oil prices if we do that. >> a complicated situation thank you, tracie potts. let's go to hadi gamble live in

riyadh >> a couple hours ago u.s. secretary of state mike pompeo arriving in riyadh he met with saudi arabia's foreign minister and right now he's meeting with king salman. there's been a lot of speculation about what can come out of the meetings today. we understand the u.s. secretary of state will stay overnight in riyadh before heading to turkey tomorrow the big question is just what exactly happened to jamal khashoggi and whether or not the saudis were involved another question plaguing the markets here is just how much this international hoopla surrounding the disappearance of the saudi journalist will impact investment inside saudi arabia on sunday we saw the market closing off about 3.5% yesterday after all of these announcements including the announcement that mike pompeo would be coming to riyadh, we saw the market close higher 4% today it's off by 2.5% in trading over the last several

hours. a rough and tumble ride for the saudi markets as well as a lot of questions surrounding what will happen next and many questioning whether or not this davos in the desert summit that is expected to take place a few days from now should be canceled or postponed so many international ceos we've seen dropping out, deciding not to attend the summit so a lot of questions going forward about what will happen next with the fii summit and what kind ofny news we'll hear from the meetings happening in the next few hours >> when we talk about davos in the desert, is there a sense because so many international corporations and ceos backed out of this that is a black eye for the business community in saudi arabia how are they reacting to this idea that the world is turning their backs on the saudi business community >> there's a significant amount of concern here. this doesn't just have to do with what will happen in the

short-term, whether or not people will show up for this summit it has to do with the future of saudi arabia looking back on some reports we've done over the last couple of years, in particular two years ago with the announcement of the saudi vision 2030 back in april of 2016, so much excitement surrounding this move by the crown prince to diversify this economy, bring people in, open up this economy, not just in terms of the business community but also culturally, making opportunities for women, not just in driving but also in terms of being entrepreneurs so much excitement surrounding that vision 2030 so there's a lot of concern about what this story will mean not just for the investment community here but also longer term >> as you pointed out the market volatility there probably echoing the concerns in the broader business community hadley gamble, thank you very much for that. let's get to peter spiegel, the news editor at "the financial times. peter, you just heard hadley's report is there a sense right now that the international business

community is turning its back, is giving saudi arabia, the kingdom, the king, the crown prince, mohammed bin salman something to think about and this situation with jamal khashoggi? >> well, call me cynical about this i think was we're seeing is the high end figures were supposed to go to this conference have pulled out swartzman, larry fink, jamie dimon. not only are they sending lower level people, but this has been the source of a huge amount of deal flow for these banks and the private equity firms and everyone who tried to get fees out of saudi arabia. we have the sovereign wealth fund, the investment with softbank, potential ipo with saudi aramco and their chemicals unit this is a huge source of deal flow for every major bank in the world. i don't think suddenly they'll

disappear from saudi arabia. what these people are doing now i think is biding their time disappearing, keeping their heads down while this storm is brewing. what will really face people like jamie dimon is how much do they dip their foot back in the water when things calm down. the crown prince has had controversial policies in yemen, detentions of princes, of journalists this has been going on for months and it has not risen to the level of international outrange the khashoggi case has now they have to decide whether the deal flow is worth the bad reputational risk they put for their banks and financial institutions back on wall street >> we know at this point the vast wealth that comes out of saudi arabia, that's the reason why the private investment fund has their fingers in so many different projects and so many

investments. is there a sense that the ceos out there would be hesitant to take saudi money because of something like this? >> they are. we've seen richard branson and some others, they have tried to disavow from some of the money coming in from the saudi foreign investment fund. but mohammed bin allmsalman the years ago turned this sovereign wealth fund very active internationally. they have taken stakes in uber dara was supposed to show up at this summit, and he has pulled out. they have already invested billions of dollars in tech companies. a lot of autonomous cars a lot of these companies can't extricate themselves right now they are in bed with the saudis. this could blow over but it does force a lot of executives to look in the mirror and say is

this the money we want to be associated with given the human rights record? it's a question they had not had to ask up until now despite the record because it has not been as high profile as the khashoggi case >> peter, if you i might ask you to put on your hat now as a possible pr person you work in news you and i are both journalists, we have a special tie to the story. if you were to advied advise thi royal family what would you say are the steps they have to take to get this under control and tell the business community that they are open for business >> it's a tough call it's not something the saudis are good at. they have to come clean about what happened. the first lesson of pr is tell the truth, tell it quickly, otherwise it will dribble out for months if not weeks.

what we're seeing is the saudis are thinking about saying, wow, we did it, but it was a rogue element within the kingdom we didn't mean to do it. it was interrogation gone bad. that still smells to me, but is it credible enough we've already seen the trump administration seemingly willing to accept this explanation so, if they come clean, i think question number two is the role of the crown prince. it is sort of -- he's become the focus of almost everything that's happened in terms of repression domestically of his rivals does the king stick with him does he look for other elements within the royal family. is that a change that needs to happen now that's what everyone is waiting for. mohammad bin salman has been the focus of a lot of this business community because of the deal flow does the king decide that enough is enough, he's besmirched the reputation and caused risk for the kingdom. that's what we need to watch for. that's the internal battle that we don't see much now. >> real developing story still

thank you very much, peter spiegel for that update there. still ahead, slamming the door shares of one housing related stock are deep in the red. we'll bring you that name ahead. and brace yourself for a barrage of earnings. a bunch of well known companies about to report results. the names that need to be on your radar when "worldwide chgererns. l: we saved our money a, we get to spend it - our way. ♪ valerie: but we worry if we have enough to last. ♪ cal: ellen, our certified financial planner™ professional, helps us manage our cash flow and plan for the unexpected. valerie: her experience and training gave us the courage to go for it. it's our "confident forever plan"... cal: ...and it's all possible with a cfp® professional. find your certified financial planner™ professional at letsmakeaplan.org.

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5:23 our nation's capitol live in washington, d.c. we're keeping an eye on shares of adobe the company is getting a nice pop after offering bullish outlook for next year. and shares of jb hunt moving higher after reporting mixed results. missing on the top line but reporting a profit beat. shares are up almost 2%. and shares of door and windowmaker geldwyn are tumbling this morning the company announcing its cfo is out it released preliminary third quarter results that came in below expectations and then it lowered its annual guidance as well shares of the charlotte-based company are down more than 13% in the premarket trade just adding to some of the woes that many home billing stouildis

have been feeling. at the intersection of money and politics, peter thiel is making a big bet ahead of the midterms the republican mega donor pumped $250,000 into the trump victory committee, a fund that benefits the republican national committee as well as the president's re-election campaign according to a regulatory filing, the donation happened in july it's they'll's first donation to the fund since the 2016 election let's check on the other top headlines outside of business. phillip mena is live with the latest >> good morning. a woman in southern california was killed when santa ana winds knocked a tree down on to her car. her toyota was crushed wind gusts topped out at 60 miles per hour and left tens of thousands of customers in the dark an investigation is under way into a suspicious letter sent to the home of maine center susan collins a spokesperson for

the republican lawmaker says the writer claimed the envelope was contaminated with ricin. bangor police cordoned off her house for several hours as a hazmat team investigated senator collins have received several threats since voting for the confirmation of supreme court justice brett kavanaugh. tonight's mega millions jackpot has grown to 6$654 million. that is the second largest in the drawing's history. tomorrow's powerball jackpot is 345 million. combined that's 9$999 million the chances of winning both ridiculously slim. we're talking 1 in 88 qu quadrillion. >> i'm buying multiple lottery tickets as soon as i get out of here thank you. coming up next, stocks and your money the five key things you need to factor in to your investment strategy we'll tell you what they are

next. and tech on deck we're counting down to netflix's big report can the streaming giant signal a turnaround after f.a.n.g.s fl?al we'll discuss when "worldwide exchange" comes back there are so many toothpastes out there which one should i use? choose one that takes care of your gums and enamel. crest gum & enamel repair cleans below the gum line and helps repair weakened enamel. gum & enamel repair, from crest.

green arrows on wall street this tuesday we'll find out what's driving the turnaround tech on deck the first of the f.a.n.g. stocks reporting results today. what you need to watch from

netflix. and a big update to the smear campaign against the new bagel emoji. details ahead. it's tuesday, october 16, 2018 you're watching "worldwide exchange" on cnbc. ♪ welcome back thanks for being with us on cnbc i'm dominic chu. brian sullivan is on assignment. here's what's leading cnbc.com wall street awaiting a slew of earnings you have blackrock, goldman sachs, morgan stanley and dominos all set to hit the tape before the opening bell. after the close keep an eye out for netflix results. more on that later on in the show twilio is buying sendgrid for $2 billion in an all stock transaction this comes as part of a larger effort by the cloud company to boost its suite of

communications related tools the deal suspected to close the first half of 2019. secretary of state mike pompeo arriving in saudi arabia just a short time ago. this as questions mount following the disappearance of journalist jamal khashoggi the saudi stock market tumbling again this morning we'll bring you more on this as we get details let's get you up to speed on the market action. futures are pointing to a slightly higher open we can see the dow opening up by just around 27 or so points. the s&p up by 2. the nasdaq up by 24. the treasury side of things, ten-year is yielding 3.17% the two-year is yielding 2.87% turning overseas, in asia, a bit of a mixed session japan led things up by 1.25% the hang seng in hong kong just about flat the shanghai off by 1%

on the european side of things we're seeing a mixed market there. the ftse 100 is down by one-third of a percent the dax and the cac in france both posting just marginal gains in their early trading joining us is michael bappas managing director of viaos advisers michael, thank you for joining us we read through those boards there's a lot of stuff happening under the surface. so how exactly are financial advisers like you navigating the current waters is there a flight to safety? is this a real buy the dip opportunity. >> i think you're seeing a flight to safety you had the f.a.n.g. stock that shot up so fast and led this market you do have many companies who are trading cheaply that nobody even realizes right now. there will be a big rotation out of -- not fully out of tech but rotating from tech and large cap

growth into more value names with companies who are growing earnings, growing dividends, and still positive what types of names fit the bill for you? whether they be stocks or industries where are you finding that value? >> we start with earnings. earnings, can they grow dividends? have the dividends been growing? have the earnings been growing people forgot about value for two, three years now we're looking large cap value. looking mid cap value. something with a name where earnings matter. earnings will matter more now than they ever have. does that mean in this current earnings season that somebody like you is scrutinizing the results heavily? the earnings growth has been solid over the course of the past couple of years so is this earnings growth environment going to continue to propel this bull market higher >> without using too much of a cliche, you have to show me the money now. it's been easy to grow earnings.

the company that grows earnings for the next two quarters, third quarters, those are the companies that we're super hot on >> it's interesting you mentioned this many of those value names are high dividend payers in a rising rate environment those dividends become relatively less attractive for utilities, telecommunications services companies is it fair to say right now that with yields near seven-year highs for the ten-year, that there's actual competition for capital on the fixed income and perhaps even savings account and cd side of things? >> we have not seen that competition for 7 to 10 years. people expected rates to rise. they've been talking about raising rates, but now when it's here everybody is panicked there's competition. you're seeing cds, 2.20 for two-year cd. we have not seen that for years. that's driving the flight to safety

>> what are the biggest questions that your clients have you service high net worth clients what is worrying them? when you get the phone call what are they asking? >> right now there's a lot of headline news. a lot of headline risk and global risk. whether it's the tariff wars, the news out of saudi arabia, people are needing to refocus on actual markets and actual fundamentals our clients are asking a lot about the surface stuff. a lot about trade wars anything that's going on that's not related to the fundamentals. >> what is the biggest risk out there? >> biggest risk is we don't figure this out with china i think we will. i think you won't see this going past the elections that's the biggest risk. also i think earnings. if earnings don't come in and growth becomes super stagnant, that's a risk. those are the two biggest risks. >> we've been talking about those risks.

just if you talk about taxes, you have to figure your client base is focused on those is there a sense from your client base that they are still optimistic about the current tax environment that we're in? do they think it will go away? do they think the benefits have been accrued now it won't accrue later down the line >> you bring up a very good point. people have not focused on that yet. that's a huge plus for the future growth of the economy everyone forgot about it it happened. the tax bill went through. now we moved on. we have not seen the benefits of that yet i think you'll start to see the benefits of that first quarter through fourth quarter next year that's why we're positive on the economy, on the market growth. well into next year. >> there's a lot of stuff going on michael bapis, thank you very much for joining us. >> thank you for having me let's find out what else will be on peoples minds and what people will be talking about today. for the top trending stories,

bertha coombs is back with those. >> facebook joining the fight against voter suppression ahead of next month's midterm elections. in addition to the existing regulations on false news, facebook is banning posts designed to deter people from voting or spreading fake information about the polling process. facebook set up a dedicated reporting channel to state election authorities and has added incorrect voting information to its feedback menu when users report a post apparently people will try to make you believe that you can text to vote, which we're just not there. >> i struggle with these stories. o on one hand i feel as though we have to give people a modicum of credit how much do you want to regulate what people see and do social media was not prevalent

when i wuas growing up, but we know how much it matters -- >> when i was growing up it wasn't around, especially in the '80s it's one of those things where you think that people wouldn't fall for these things, yet they do >> that's my point i don't know much we want to -- i want to give people credit when apple released its new bagel emoji earlier this month some users were disappointed at the lack of filling. >> this is amazing >> apple heard their concerns and the company has now released a new bagel emoji. and this one has a generous smear of cream cheese. >> there are also people in our building who do the holing out of the bagel to get rid of some of the carbs

the next step is the holed out emoji. >> goodness. >> some people will never be satisfied. this story is unbelievable if you own a honda you might want to check the air bags not necessarily for safety but just to make sure they're there. >> what? >> authorities are reporting a rash of thefts from newer honda vehicles only the thieves are bypassing the car's contents and stealing the driver's side air bags the air bags can be resold to repair shops or online to consumers for more than 1,000 bucks. they must be the neatest thieves in the world if they can take the air bag out and you don't notice it, that is like some really ocd kind of robbers. >> correct me if i'm wrong, there was a span when i was growing up when they said two of the most stolen vehicle models

were honda civics and honda according because the parts were so interchangeable with other automobiles. so it seems like even the air bags can be used in other vehicles >> i thought that stopped. i guess it's always something new. >> bertha coombs, thank you very much for hat in the sports world, the packers and the 49ers faced off if green bay on monday night football it was so good. the game was tied up at 30 late in the third quarter aaron rodgers connected with his rookie receiver to get within field goal range and mason crosby successfully kicked the 27-yard field goal with three seconds left he got the win for the packers a walk-off field goal. i was heart broken but my niners are showing signs of life. on the diamond, the dodgers hosted the brewers in game three of the national league championship series. the brewers took an early lead

and never looked back. their victory was capped off bay two-run home run in the seventh inning the brew crew won by a final score of 4-0 they now take a 2-1 lead in that championship series. coming up next, the flight to safety. why u.s. stock investors need to pay attention to what's happening with the japanese yen right now. but first as we head out, a check on the dow winners and dow losers stick with us. "worldwide exchange" will be right back

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prewashing and removing stuck-on foods, the first time. wow, that's clean! cascade platinum. that is times square in new york coming up later on in the hour we'll see the "squawk box" crew. for now we're seeing marginal gains to kick off this day if these gains hold into the opening bell, the dow jones would be up by 25 points the s&p by 4 the nasdaq by 29 on the currency side of things, we're seeing a bit of movement there in the euro dollar strength. 1.1571 is what it will cost to buy a euro dollar/yen, 112.09 the pound, 1.3195. let's discuss the currency market with adam cole. adam, i've been focused on the

yen. because i and many traders out there view it as a risk proxy, something that tells us whether there's a risk on or risk off feel to it what has the japanese yen been telling you? should we feel things are safe again macro speaking because of what's happening with the yen? >> i think things have stabilized last week the yen broke the trend under-performance. there's yen strength on that safe haven status. at the moment we feel reasonably comfortable that the selloff in risk will be short-lived we would be a lot more worried about equities if the weakness in equities had its roots in the bond market than if it was something equity specific. at the moment it feels like it's a conventional risk-off move and they tended to be short-lived. core view is still yen negative. and i think that trend will reassert itself if risk

stabilizes >> adam, we watched dollar/yen as one of those risk gauges. we also watch some of these crosses with the yen, like the aussie yen, the cad yen, the kiwi yen is there anything we can glean from the action in those currency pairs and crosses that could tell us about the global risk environment on a macro basis? >> so i think the instructive move last week was the fact that many of those currencies, aside from the yen, didn't move that far despite the fact we had a fairly material selloff in risk assets in the second half of the week i think what that tells you is that the move in asset markets was ambiguous. so when markets are risk off, what you traditionally see is equities selling off, bonds rallying what we had in the early part of last week was equity markets selling off but the rise in bond yields that pushed them over the edge

that's a much more ambiguous background for fx. what we see in that environment is fairly indiscriminate dollar strength against most other current sis. last week felt like we went through both phases of the investment cycle in the space of a week the fact that markets were so ambiguous left it difficult for normal risk proxies like the aussie, the kiwi, the canadian dollar to take direction from that things hopefully will clarify going into the earnings season and through the course of this week >> adam, as we talk about currencies, they're front and center not just because of the price action with regard to markets overall but also because of the trade and tariff discussions happening. we know treasury secretary steve mnuchin wants to put currencies front and center for any trade deal that gets negotiated. take us through how that will play out in your mind what could the currency moves be because of u.s. policy on trade and

tariffs? >> i think we will continue to see, as we have done under this administration, some fairly sharp knee jerk reactions as countries come off the u.s. radar. trump's focus seems to be on bilateral trade position that throws up china, japan, canada as the largest surpluses with the u.s. and we will go through the phases where they will come on to the radar and currencies move accordingly and have a general tendency to strengthen as a result those phases will be short-lived. ultimately the u.s. focus appears to be still fairly squarely on china in terms of actual policy changes rather than rhetoric. and for the next six or nine months that's likely to remain the case so we would see those moves as relatively short lived >> got you adam cole, thank you very much for bringing us those insights this morning on the global

foreign exchange markets still ahead, netflix on deck the countdown is on to the company's quarterly report can the streaming video giant stage a comeback for tseho f.a.n.g. stocks? we'll debate that next gather new insights, leave your data protected on-site, and put it all to work with ai. the ibm cloud. the cloud for smarter business.

welcome back to "worldwide exchange." we're gaining just a tiny bit of steam here for the futures market for stocks. the dow jones opening up by 35 points if we carry these gains into the opening bell. the s&p up by 5 points the nasdaq up by 31. time to find out what's coming up on "squawk box. andrew ross sorkin is here with a preview. we have a big slate of things on "squawk box" this morning. >> we do a big show we will talk about the life and times of paul allen, becky who is to this elbow of me is looking at a story right now about that that's somebody we want to talk

about. on tap today we will talk earnings there's a lot of them. we'll talk markets the big guest of the morning, larry fink of blackrock will be here at 6:30 a.m the company reporting its earnings larry fink also one of the figures in the decision to step away from saudi arabia and this conference taking place next week that's an issue we'll talk about. we'll have the cfo of johnson & johnson on later and we'll have the hhs secretary with us, alex azar big morning. >> we'll tune in in about eight minutes for "squawk box..." netflix set to report quarterly resultses at the end of today it's been a rough month. shares down 10% since the start of october it's flirting with correction and bear market territory. netflix and other big names about be front and center for

investors. we're joined by cyrus mayawala this morning how important is netflix for setting the tone for this earnings season? >> i think netflix is incredibly important. it's the number one reporter last quarter they missed numbers by 1 million subscribers if they hit numbers this time, there's a question of what the guidance is for next time. is netflix still a growth stock or is the competition slowing it down >> what's the most important thing we're watching for is it the subscriber additions what do we think >> i think last quarter they ended with 130 million subscribers. they're expecting to have ended this quarter with 135 million subscribers. if they hit that 5 million of new additions, they're half safe the critical thing is what do they think for the next quarter? what do they think of the

competition from disney, at&t, apple. you know, has growth slowed or is it still a blockbuster? >> how much do you view netflix as a bellwether for communications services and technology in general? >> very much so. it was briefly the biggest media stock in the world it pulled back a bit it's still a huge bellwether it's the market leader in the world. it's getting better and better in terms of recommendation engines, it's ecosystem, it's able to keep customers so when disney launches in a year's time its competitive video streaming service, they will have a hard time to steal customers from nix >> how important is f.a.n.g. to the rest of the marketplace? facebook, amazon, netflix, google, alphabet the sentiment has been fairly negative on many of these former

leaders in the stock market. >> yeah. from where we sit, you know, we look at the world thematically on a technology theme basis all these f.a.n.g. players are doing very well. they're well positioned for the next generation of tech themes the two big themes that could rock the boat are geopolitics, so trade wars, a massive sub cybersecurity attack and two, regulation regulation is coming whether tech companies like it or not it's a question of which of these f.a.n.g. stocks will get hit the most >> which of these stocks, maybe f.a.n.g. included or broadening out more represents the most attractive part of the market for you now given the recent market action? is there something out there that investors should be looking at more closely because it's so on sale right now so to speak? >> i wouldn't say any stocks are on sale just now i would say the safest stock is

probably microsoft from a regulatory angle, like apple it's reasonably safe not at risk like facebook or google from a regulatory angle amazon also is at risk from a regulatory angle and i think microsoft is just -- if you look at our thematic screen on all the big tech themes microsoft is performing well we expect it to continue to perform well at this point in time we like it >> all right microsoft, your top pick cyrus, thank you so much for joining us this morning from the london newsroom. that does it here for "worldwide exchange." as we head out, let's check on the futures. we are seeing a bit of a rebound in what's happening with the stock market the dow jones opening up by 38 points the s&p up by 5. nasdaq 31 points also want to point out the treasury market as well. ten-year treasury note yields ticking slightly higher. just around that 3.17% mark

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. good morning stock futures pointing to modest gains, but that could soon change three dow components are out with results united health, johnson & johnson, and one more, goldman sachs. blackrock reports this morning the ceo, larry fink, is here to talk about market volatility, he knows a lot about china. also pulling out of that saudi investment conference. and we're learning more about google's plan for a censored search engine in china we'll show you what google's ceo said at a conference last night.

it's tuesday, october 16, 2018 "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at the u.s. equity futures. address joe mentioned you are looking at positive arrows right now. dow futures indicated up by 52 points s&p futures up by 5 1/2. nasdaq up by 31 points anything could happen. we're getting into the thick of earnings season. it's not just those three dow components, we'll also hear from blackrock and morgan stanley look what happened overnight in asia the s&p was down seven of the last eight sessions. thsd