welcome to "street signs." i'm joumanna bercetche french stocks surge at the open but german and italian shares fail to pick up wall street's lead as the dow jumps 1,000 points technology and retail lead european sectors after u.s. retailers jump on strong holiday sales and tech stocks post their best day since 2009. vinci shares open higher after they acquire a majority stake in gatwick airport in a deal valued at 2.9 billion

pounds. president trump vows to wait as long as it takes to get funding for his border wall showing no signs of budging as the u.s. government shutdown stretches into its sixth day >> whatever it takes we'll have a wall. we'll have safety. we need safety for our country, even from this standpoint. we have terrorists coming in through the southern border we have the terrorists also coming in from the southern border. you know why it was always the easiest. it's about an hour into the trading session. we have some green in europe to show you, not as much as we anticipated. in fact, a lot of gains we saw stateside starting to fade in europe as we trade down on the stoxx 600. you can plablame the german stok market for some of the red ink the dax is not showing the level of support that we saw on wall

street as the market in germany fades. down a half percent. a little like we've seen all this year. 10,574 for the dax we are under the 7,000 handle for the ftse 100 for the french stocks, the cac has seen the strongest gains patches of weakness elsewhere the ibex up by a tenth of a p perce percent. so this looks nothing like we saw on wall street yesterday >> just to pick up on that, karen, a lot of gains in europe have been wiped out. just in the last half hour or so i want to talk about yesterday's price action in the u.s. again, you can see this behind me, it's a full sweep of green

for all of these indices to put that into context on a day when european equities were closed that was christmas eve day. we had turbulent price action to the down side. the dow did deliver its largest points gain ever in history, we are only back to where we were last friday. a lot of swings. a lot of movement. for the month you have dow down about 10%. s&p down about a similar amount. yesterday we were 5% up. nasdaq up 6% as well that was led by some bigger names like amazon gaining almost 10% in yesterday's trading microsoft up 6.8%. apple up 7% as well. again, some of these stocks are performing at their best since march of this year when they also rebounded and when the tech sector did get hit that's the theme for the tech sector also want to talk about u.s. retailers. yesterday they did post their

best holiday season in six years with sales up more than 5% from 2017 that is according to reports by mastercard online sales in the u.s. rose 19% from last year showing strong e-commerce growth for the christmas period this is the picture in europe. retail stocks are getting a lift on the back of the lift we had for u.s. stocks yesterday. as you can see, the market continues to distinguish between some of the household goods names, the nondispensable spending goods so ahorichemont and burberry jumping out there. let's look at u.s. chipmakers. here's some of the key chipma r

chipmakers in europe, so a bounce between 1% and 2%, so not as much as some of the performance in the key u.s. stocks overnight finally a bounce for the tech sector in europe it's been impacted by the supply chain effect, particularly on some of the smartphonemakers, and apple one of those names >> president trump is looking at using an executive order toban u.s. firms from using equipment from huawei and zte. the order could happen as early as the new year. this is according to reuters this is the picture for telecoms in europe. dt is an operator who said they would be considering ruling out huawei technology for their 5g rollout. vodafone is another. all of these telecommaks are trading in the red on the back

of that news the huawei and zte story continues to weigh on telecom and the tech sector as well. this is the picture for european telecoms this morning, not so pretty >> thank you neil griffith lambert joins us from moody's it's that time to trualk about 2019 forecasts and the outlook for next year. what should investors think about? >> we cover a broad range, transport infrastructure, project finance and utilities. we published our outlooks for a couple of sectors including european unregulated utilities, which has had a torrid time the last 6 to 8 years. we've seen declining demand with economic shrinkage or weak gdp growth we've seen weak energy prices.

we've also seen renewables take an increasing share of generation, which has exerted further downward pressure on prices we have a positive outlook reflecting expectation and earnings for the largest utilities will grow in the region of 4% to 5%, which doesn't sound a lot, but it comes after many years of declining earnings what s whas driving that growth is higher commodity prices, and companies making returns on investments they made in renewables, in grids. but this is not to say there are not challenges we see challenges on a number of fronts in the short-term economic and political risk. that's evident in the uk with the introduction of the retail price cap that we see. then over the longer term we have the fundamental questions which face the sectors, as it adapts to the energy revolution

and decarbonization and the question is which utilities can cope best with that. >> i want to pick up on the renewables point as we started out 2018 we were talking about whether we would start to see decent returns in the sector after years of subsidies coming off we finally had the cost of renewables starting to slide where profitabilities were forthcoming for investors in the sector what do you see for this year with solar and wind? do you think we'll have decent returns for some companies invested in the space? >> utilities were late to the renewables party but most of them got into that now. many will continue to earn very healthy returns for quite an extended period because they had fixed price tariffs for 15 years. they'll continue to benefit from that for a long time to come as you say, subsidies have come down also the cost of the equipment has come down. so if you invest today, it is

probably possible still to earn an attractive return the question is how will you do that in the future with subsidies declining, companies that invest in renewables will be increasingly exposed to merchant power prices so will power prices be high enough in the future to earn that sort of return? with the growth in renewables which are low-cost generation, the effect of that will push power prices down. >> are there any countries in particular that you're looking at in terms of a geographical competitive advantage within europe >> the countries that have grown the most in renewables are germany and the uk will that bring a competitive advantage? in time perhaps. the problem is historic renewable investment has been quite expensive. if you look at some of the offshore wind farms in the north sea, those are earning prices of more than 100 pounds, at least double the current electricity price. as an economy, consumers will

carry the cost of that for quite a long time to come, which is not to say we may not ultimately benefit. one of the effects of this investment is to push down the cost of equipment and we will benefit from that in time. it's not simply about cost, it's about meeting national and international decarbonization components >> we hear more and more of this happening in germany, but in this country with everything going on, the political ba backdrop, do you think some of this has been lost on brexit discussions instead of thinking about renewable energy and planning 5, 10, 15 years ahead >> it's undoubtedly that a lot of time and effort has been devoted to brexit over the last couple of years.

has that been at the expense of policy more broadly? that's clearly a risk. but the uk has done very well in terms of that and having a portfolio of assets and that will benefit the country in the long term. >> can i ask you about oil we've seen a dramatic decline in the price of oil after going up what impact does that have on the energy price mix going into next year? >> oil doesn't have a lot of effect on electricity prices which tend to be driven by gas or by coal so there's clearly some correlation between oil and gas. but less than has been commodities will remain a key driver on energy prices, certainly over the medium term the longer term is uncertain how does an electricity market work what sets the prigce

>> so it's not a big one for you? >> no. what about the politics, too last year one big moment was a fight at nato headquarters between president trump and some allies over gas and where the germans are sourcing from some of the natural gas from. do you think there's elevated political risk around gas because of the spotlight turned around the russians and where the gas comes from that port of the world or elsewhere >> we've seen political risk around gas for many years. that's not going to go away. going back to the benefits of renewables, one of the advantages we see is reliance on gas will decrease. there's an important question around gas looking over longer term, looking over the next 20, 30 years if we are going to meet renewable targets, we will all have to use much less gas.

>> going back to the proposition for utilities, one reason people buy it is because it's a defensive stock and the dividend value, these companies pay a steady dividend, perhaps higher than prevailing market interest rates. when you look at the free cash profile of these companies, any ones that stand out in particular >> a lot of these companies do tend to be focused on dividend payouts. the delicate balancing act for them is maintaining credit policy funding the significant investment programs that they want to have, and paying sufficient dividends to their equity shareholders for them to continue to be interesting and they need do that potentially because they need to bring in additional equity overtime to fund these investments in terms of particular companies, there are none i can particularly pick out. we focus on the credit side

rather than the equity side, so i couldn't say from an equity perspective which is the most attractive if i look at credit quality of the sector, it's declined overtime the example i always have in mind is rwe, when we first rated it it was in the aa range, so very strong investment grade today it's baa3. so it slipped many notches it's not alone in credit quality. we have seen some deterioration with some companies over the last decade. want to get into how politicized energy bills have become, tariffs that can be charged. we've seen pain points around other types of energy, like in france, yellow vest protests with protests on fuel. how possible is it for utilities in this space, whether it's the uk, france, germany to increase

or maintain builds in 2019 give than a huge part of the population feels like they're just getting by to pay fixed energy costs like energy bills >> it's a real risk. i talked about utility companies benefiting from higher commodity prices which exerts upward pressure on electricity prices if you can't pass those higher costs on to consumers, you as a company are going to suffer. it's a risk which is probably most acute in the uk we were talking earlier about the cap on standard tariffs. we had the yellow vests in france somewhere in most european countries it's fair to say it's highest in the uk. it's not just simply energy bills. there's been discussion about the uk water companies, whether those bills are too high >> neil, stay with us. we'll continue that conversation shortly. you can get involved in the

conversation follow us on twitte twitter, @streetsignscnbc or tweet us directly. coming up, there's no clear end in site to the u.s. government shutdown as president trump vows to stick to his guns. more after the break a quick look at u.s. futures after that stunning session we had stateside, 1,000 points. i don't think it will be repeated today early signals on the open are for a bit of giveback so the market is not looking that positive as we count you down to the u.s. session your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown

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we're working to make things simple, easy and awesome. ♪ >> jerome powell's position as fed chair is not in jeopardy according to a fed adviser

the president's unhappiness has raised speculation that he may fire powell, however speaking to reporters outside the white house kevin hastert dismissed those speculations >> is the fed chairman's job safe >> 100%. >> president trump is prepared to do whatever it takes to secure funding for his border wall as the u.s. government shut down extends into a sixth day. the u.s. president made the comments in a visit to troops into iraq and blamed nancy pelosi for the continued shutdown blayne alexander has more from washington president trump making a surprise visit to u.s. troops in iraq his first trip to a combat zone as commander in chief. something he had faced criticism for not doing during his nearly two years in office.

the president and first lady thanking troops for their service. >> we came this year, our eternal gratitude for everything you do to keep america safe. >> reporter: president trump also focused on the border battle back at home as the shusdoshus do shut down faced day five something democrats have said they will not fund and critics say will not work. >> will not stop illegal immigration nor drug trafficking. >> reporter: negotiating at a standstill since saturday. the stall mate coming as border protection faces new scrutiny following the death of an 8-year-old migrant child in u.s. custody. the child was taken to the hospital and died christmas eve, becoming the second child to die in u.s. custody just this month. last month the homeland security

secretary grilled about this >> i'm talking about people who died in your custody, you don't have the number? >> i will get back to you with the number >> reporter: today homeland security secretary says she is seeking help from outside agencies to help with medical care top house democrats say they will hold hearings into both deaths once they take control of the house next week. fresh from meeting u.s. troops in iraq, the u.s. president also greeted troops in germany during a brief stopover at a base in ramstein, president trump met with troops and posed for selfies. the president is looking at using an executive order to ban u.s. firms from using equipment from huawei and zte. the order could happen as early as the new year. this is according to a report

from reuters it is the latest step by washington to strip the two chinese companies out of the u.s. market. the trump administration alleges huawei and zte work for the chinese government and that their products could be used for spying new misconduct allegations brought against carlos ghosn by tokyo prosecutors focuses on a payment made to a saudi businessman. ghosn was arrested for the third time on friday as investigators accused him of passing personal losses on to the japanese automaker. in company news, french construction firm vinci has taken a majority take in gatwick airport in a deal valued at 2.9 billion pounds the agreement will see vinci expand its network of airports to 46 across 12 countries. neil griffith lambert still is with us on the show. interesting timing for vinci to announce this deal not least because it's the last

couple of days of the year, but also in terms of thinking about expanding into the u.s. and british airports at this crucial time of the brexit phases and brexit discussions what is your outlook for the uk airport industry going into next year >> the key question is is brexit and airports along with ports two of the sectors which are most exposed to a no-deal brexit it would have a potentially significant impact without transitional arrangements. our best case is that the uk and the european union will agree to a trade deal clearly the risks of no-deal have increased in terms of vinci's acquisition of the share in gatwick, this is consistent with historic strategy vinci is one of the largest in international construction

companies. many equity investors would regard gatwick as a trophy asset. >> not when the drones were circulating last week. >> assuming we actually do get to a transition agreement what do you think that means for passenger traffic? >> the key question is what is going to be the impact of brexit on uk economic growth. we have not had a brexit before, so it is very difficult to say imf forecasts were in the absence of a deal that uk gdp would contract by 4 prg%. we'll have to see the difference having some sort of agreement will make. >> can i ask about the airport outlook overall? it looks like it might be too cautious when you put this together on the 30th of october, when we had price falls in the oil market, since then we've seen a significant decline from that level in the oil price, which is quite supportive for the sectors

that were facing high fuel costs, passengers were saying it will cost more to buy a ticket do you think we'll have a better year than you anticipated when you first put this report together >> it's possible it's always difficult to call the future when we publish outlooks, we always have our best estimate, best guest >> the oil traders didn't see this it's hard for you guys to see the significant swings you have a number, i think it's 5% on traffic numbers, if you're above 5%, you change your assessment, below 1% you change your assessment. how key are those figures? >> that's our range. we've seen respectable growth in the airport sector over recent years. the longer term trend is likely to continue. it's subject to other factors. what happens with the uk economy, what happens with the european economy, and what happens globally we've seen strong economic growth, but that may clearly weaken that will have an impact on airport traffic

>> neil griffith lambert with us from moody's u.s. retailers having a bumper christmas and a boost for consumer confidence, the best in about six years. stunning turnout online and in some of the stores we'll be back to discuss

welcome to "street signs." here are your headlines. french stocks surge at the open but german and italian shares fail to pick up wall street's lead as the dow jumps 1,000 points technology and retail lead european sectors after u.s. retailers jump on strong holiday sales and tech stocks post their best day since 2009. vinci shares open higher after they acquire a majority stake in gatwick airport in a deal valued at 2.9 billion pounds. oil prices fall after jumping 8% in a post-christmas

comeback as fears linger on. we had that dramatically positive session for u.s. equities overnight the dow staging a 1,000 point bounce, the largest point bounce ever in the history of trading not so much in relative terms, but just in absolute terms in europe we're not seeing so much of the rally. you can see in the past hour or so european stocks have tipped from starting off the day in a positive foot to mostly trading in the negative. ftse 100 down 0.4% down 27 points the dax down 1.5%. so really bucking the trend. perhaps didn't get the memo that u.s. equities and japanese equities are staging a recovery. the dax has taken its cue from chinese equities which were trading in the red overnight

more bad news there. picking up momentum. the dax is technically already in a bear market territory that's down 20% from its 52-week high cac is the only index slightly in the green up a quarter of a percentage point. italy also dragged down. the picture for europe is at odds with what we saw with u.s. equities yesterday investors who were hoping for a continuation of the relief rally perhaps disappointed with some of the price action we're seeing here let's move on and talk about fx. today we have the u.s. trading a bit on the back foot, which is interesting given the big rally that we saw in u.s. stock markets overnight. we have euro bouncing, almost up at that 1.14 level cable trading firmer, 1.2650 or

thereabouts. i want to draw your attention to dollar/yen again, this is interesting the nikkei was up almost 4% in overnight trading. typically on a day when japanese index does well, you would also see yen weaken in tandem today the theme seems to be one of flight to quaultism we'lityq. the yen is trading firmer to the dollar to the tune of 0.4% the currency is telling you something different from what the nikkei is telling you overnight. people are still getting into that safe haven flight to callical quality mode swiss frank a safe haven currency there let's move on when we talk about oil. oil also had a strong session yesterday in u.s. time staging a recovery of 10% at one point this is the biggest one-day jump in a couple of years time.

putting it all into context. context is everything. energy is still down about 40% from where we were back in october. yes, a big one-day recovery in oil, but that didn't last long either brent is trading down 2.4% wti down 2.21% as well. all eyes on how opec plus reacts come january of next year. let's look at u.s. futures they have really turned south. this after that bumper session we have been talking about the major indices up yesterday now the dow seen opening up 300 points weaker. nasdaq down 100 points or so looks like market sentiment is yet again nosediving for the worst.

>> the u.s. retailers posted their best holiday season in six years with sales up more than 5% from 2017. that's according to a report by mastercard online sales in the states rose 19% from last year showing strong e-commerce growth mastercard said consumer confidence remains strong. the 26th of december or boxing day is one of the big the shopping days of the year as people look for discounts and use their newly received gift cards. >> reporter: while many people think the retail shopping season ends on the night before christmas, millions of shoppers can't wait for the day after christmas to buy everything on their wish list. december 26th is so popular that shopper track is projecting it to be the eighth biggestretail day of 2018. three of the biggest reasons for post christmas shopping are big discounts, spending gift cards and returning or exchanging unwanted presents.

taking advantage of discounts after christmas is a textbook move for many savvy shoppers clearance sales abound here at the woodbridge mall in new jersey >> my daughter got a lot of money in gift certificates we know the day after christmas is gate day for sales. >> i do shopping with my dad every day we come the day after. he gives us money and we splurge. >> i had to return a coat and i was dreading it because i thought the lines would be awful, but it's been great >> i'm here to spend gift cards for the kids >> reporter: for shoppers who received gift cards for the day, this is a great day to spend them but not everybody remembers to use them letting them disappear in a closet or drawer. ceb investment group estimates $1 billion in value in unspent gift cards every year. more laws around the country have removed gift card use by

dates. just on wednesday master card said this holiday season is the best it's been in six years. for cnbc, i'm eric chemi our next guest is robert gardner, co-founder of reddington and creator of the game silly monkey. you're on the high street. continues are tough here but in the states not the case do you think people are frittering away money as they come up to year-end? >> before, when you were talking about oil prices, you were saying context is everything you have to remember that most retail spenders don't watch cnbc, don't follow the market. spending money at christmas, before christmas and after christmas is a habit we've been doing most of our lives. we live in a world of not only

television but social media, instagram and everything else that compels us to want to go out and spend money and feel good about ourselves but this is in direct contrast to what we know is important, which is our financial health and well-being >> i spent most of the year reading your book. one book i read from front to cover. i have read your book to my child, now you have a card game that has some of the same characters as the book tell us what it does and how it teaches children about saving. >> so karen was referring to "save your acorns" which is for 4-year-olds to 6-year-olds the truth is that our children learn money saving habits by the age of 7 and a lot of research has shown parents are a great source of financial education. so i thought bring up an old school game, so it's not an app. it's not available on your phone. it's an old school card game called silly monkeys

the idea is to teach in a fun way basic concepts like saving, eating, which is spending, and sharing. the winner is the squirrel who saved the most acorns at the end of the game. >> i wanted to ask you about something else it also teaches the importance of sharing because there's a grandpa card that allows players to give acorns to the squirrel with the least amount of cards. why was that important for you to include that in the game? >> going back, if you look in religious texts, often advice would be to save money but to give some money to charity going back a long way in many different sorts of cultures and religions, the idea of sharing or giving or charity is an important thing. i think if you build the habit of sharing and caring and charity from a young age, it

helps you develop the ability to look after yourself. >> you should have developed a board game it seems much more complex, and you need that part where you get trapped around subscriptions where you pay the likes of amazon, netflix, car ride companies, you pay for the iphone over a subscription so many young people these days think i'm not spending money, i'm not forking all of this money in capital for a new phone up front or for a car. so i'm not spending as much as my predecessors, but small amounts of money are fleeing accounts these days. >> the reason financial education, financial literacy is a bit like climate change. it's a slow moving but really important sort of topic or issue. financial responsibility is on individual shoerls now more than ever at a time when financial decisionmaking is at its

greatest mobile phones and apps and subscriptions make it easy to spend money without noticing when you had cash, you noticed cash was gone. companies are smart, they know if they get us to sign up for subscriptions, we don't cancel them if you give people store cards, there's a billion dollars unspent, who loses but the consumer that's why it's important to teach people how to be financially responsible themselves >> coming back to karen's point, what you have got to offer is a tangible product are you not thinking of launching an app or something online that would also be financially a lly additive to yw business >> i do all of this for charity and give all of the proceeds of this to redstar, a financial education charity that i set up. with my book, when i sold one, i gave a copy for free to people i think financial literacy is important. i'm in two thoughts about an app, because i have young

children as well there's a lot of research -- i don't want to drive more action and behavior to a smartphone do you think there's a lack of patience out there around saving like instagram photos, people take instagram photos, they will buy a whole wardrobe so they can be seen in the outfit once, and they keep on buying. when you look at financial markets, one trend we started out 2018 with was around bitcoin. there was grand hopes out there that because people were taking on bitcoin they might be interested in having shares and saving money if the trigger for saving is to buy a speculative asset that would encourage them to invest in other assets. that talks about the psychology of investing, doesn't it >> walter mitchell wrote a book called the marshmallow book. he talked to young children and it feeds into what we do spending is one of them. health and fitness is another.

quality of relationships is another. teaching delayed gratification is a habit and so important in so many aspects. another important thing is the big three questions to test financialliteracy. if interest rates are 2%, you have $100, how much do you have in a year's time the second question is the same but on inflation the third is on risk and diversification. is it better to have one stock or a portfolio of stock. globally 1 in three people with name all of those three questions correctly. >> interesting presumably not 7-year-olds though >> no. and the number of people who can answer the last one correctly is the lowest, back to your bitcoin point -- >> i'm not sure the answer anymore. everything has gone down in lockstep can you answer that one definitively anymore is it better to have one stock or a bunch of stocks >> i think over the long-term,

diversification is probably a good thing >> all right robert, thank you very much for joining us today on "street signs. robert gardner co-founder of reddington teaching us a bit about personal finance and stock diversification. luxury lost its sheen in 2018 robert frank has take an look at the playbook for luxury in 2019. >> reporter: it was the year of worried wealth and markets took fall but next year could be worse. first luxury is losing its shine. from jaguars and jewelry to bags and breitling, the showdown in

luxury spending will accelerate. china is the big reason but volatile markets could also drain the confidence of u.s. spenders second, big mansion discounts. the pressure is on high-end real estate will grow with oversupply, fewer foreign buyers and those tax changes. look for big price cuts, especially on spec homes in new york, california and other high-tax states. those are going to be the hardest hit. while lower tax states like florida could be a bright spot. and lastly, weaker wall power. the art and collectibles market has so far escaped damage, but if markets continue to melt down and growth slows, wealthy bidders will hold back their paddles on the biggest trophies in 2019. >> i was going to say get involved in the conversation, but you can also get involved in our game karen and i decided to play a game of silly monkey it's all for a good cause. i have a friendly bear called yea. and i have a chipmunk called oliver >> i have more than you. i have two lots of five acorns >> you obviously save better than i do.

>> i'm still dealing here. >> it is december 27th, we're here instead of shopping that's a good thing. all right. get involved in the conversation you can tweet us directly. and let's look at european bourses as we head to this break. as we were saying, things have really turned south in the last hour or so xetra dax is down 1.5% ftse mib down 1% not enjoying the rally that the u.s. equities market saw on yesterday's session with many of those indices trading up 5%. europe a lackluster picture so far. we'll break it down more for you in a few minutes (client's voice) remember that degree you got in taxation? (danny) of course you don't because you didn't! your job isn't understanding tax code... it's understanding why that... will get him a body like that... move! ...that. your job isn't doing hard work... here.

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shares in banca carige failed to start trading after the shareholder blocked the call as it wanted more clarity on the future of the italian lender that was the picture fof r carie

when it was last trading the picture is not pretty at all for the italian banking sector the names trading down we have ubi banca also down. no love for that sector. on a day when cyclicals have done well, you would think counterparts in europe would do well no such thing this morning let's look at how italian yields are reacting to the story. some bad news there weighing you can see the five-year an ten-year bdp is trading weaker slightly firmer for the front end and the long end across the board a bit of weakness for italian assets, mainly being translated in the banking sector because of this carige story >> ten years on, commerzbank says the world is suffering from the fallout of the 2008 financial crisis the bank also says that tech no

lo tech te technological changes are hurting banks. >> i think there's a disconnect between what politicians with deliver and what voters wanted that's one of the first problems the second problem is within the economies themselves if you look across the whole of the world there are disconnections between what's happening in the united states, europe lagging behind, the chinese economy is still slowing, and there is markets where i think valuations look crazy to me as an economist. >> are they crazy? i look at forward valuations for the s&p and the ftse neil cited the ftse yields, if you take out vodafonevodafone, s flattish >> you still have lloyds to tal

about. >> i mean are they that extreme? >> i tend to look at this ten-year trailing index that robert shiller popularized it is the third highest level in history. the second highest level in history -- >> in the u.s. >> in the u.s. admittedly, but this is a time when the fed has been raising interest rates steadily you wonder how long can equities contin continue >> people are concerned about the level of debt and whether it sells down whether it sells down the assets and if it has done enough to fulfill payments corporate debt itself as well is a red flag many are saying that's the key pressure point for the economy do you agree that's where the pain will come >> many are focused on china

i think increasingly across large parts of the western world it's rising on the list. >> what if the fed stays with one rate hike next year does that give these sxacompanies breathing room do they go out to the market for longer periods of time is that something they start to see? >> from a fundamental perspective, yes, it gives them breathing space. to what extent will they be going out to the market with all of this uncertainty swirling around it's year-end, which might have some bearing upon that companies are circumspect at the moment. hopefully there's a pipeline out there waiting to go. we can't be sure >> you're an economist, but i'm asking you about tech. you made the point about market dislocations if i look at market valuations,

shiller and otherss , if i lookt consumer discretionary, down 14%. lots more of this to come and the disproportionate ownership of tech among a host of investors, that's creating problems in itself >> i think tech has been a success story over the past two years. they have drive be the u.s. market to a large extent has that bubble busrst? i don't know, it's deflating the question is can that market recover? my sense is not necessarily. you get a sense that maybe product cycles are getting too old. products are not coming to the market too quickly it's not a rerun of 20 years ago, but it feels a bit end of cyclish. >> we started off the show asking if the santa rally was finally here for europe. we're getting our answer now the answer seems to be no.

european equities are not buying the bounce we had in u.s. equities overnight the stoxx 600 is trading three quarters of a percentage point weaker after opening up about half of a percentage point stronger you can see more and more red is take over that heat map for the ratio of about 70% in the red now and that continues to grow as this session evolves. let's talk about the breakdown for european markets here you can see every one of these is trading in the red. cac was the relative out-performer. now it's trading below the flat line dax is taking a beating, down 1.6%, 170 points, again through bear correction. down 20% from the 52-week highs. ftse mib struggling as well. we had local banking news there, more bad news for banca carige

a negative picture across the board. >> u.s. sffutures giving us a signal about what can lie ahead. seems like giveback may be the course of action today after the 1,000-point gain yesterday some of the guests have made the point it was a bit technical, low liquidity, so we had a significant jump if it was truly a santa claus valley unfolding we might have more appetite here in the european markets, but 384 the dow is off early on it looks like it will be a weak day there. let's wrap up the day. we hope you have a good trading day ahead. >> maybe santa will show up tomorrow we'll see you tomorrow

it's 5:00 a.m. futures pointing to a triple digit loss at the open after the dow posted its single biggest point day gain ever. the nikkei in japan jumping 4%, and in europe many markets reopening today. crude oil prices pulling back a bit now this after soaring nearly 10% on wednesday. don't forget about bonds and borrowing costs. we'll tell you what the yield curve is saying right now and why it's important to your money. it is thursday decembe