apple rocks the market after slashing guidance on big concerns out of china. tim cook sitting down with cnbc as apple's stock plunges we'll bring you his comments straight ahead. futures right now tumbling on the back of that big apple news. >> right now the dow is pointing to a more than 300-point drop at the open and currencies crushed apple's rare warning sparking a mini flash crash in the currency markets. we're digging into that big move in the yen it's thursday, january 3, 2019, "worldwide exchange" begins

right now. ♪ good morning welcome to "worldwide exchange." i'm dominic chu. brian sullivan is off today. if you're just waking up, this is the stock to watch today. apple shares down big after the company slashed guidance on weaker sales out of china. those apple shares off by 7% right now. they are just off their worst levels of the after-market/pre-market trade. apple weighing on the u.s. futures market it's a larger but not the largest weighting in the dow jones industrial average for that reason apple is having an effect. the dow jones would open down by 352 points if these losses in futures carry over into regular cash session trading the s&p off by 40 points where you will see the outsized

impact of apple is on the nasdaq right now those futures down by 177 points we have full team coverage of this major developing story. dan ives covers apple for web bush securities. frank holland is digging in on the apple supply chain let's begin with elizabeth shultze and exclusive comments from tim cook. >> good morning. that's right apple's ceo, tim cook, speaking to josh lipton in an interview yesterday. that was after the company announced its revenue guidance, cut for the first quarter, come saying the new forecast is a collection of macro economic and apple xespecific issues. take a listen. >> as we look at what's going on in china, the -- it's clear that the economy began to slow there for the second half.

i believe the trade tensions between the united states and china put additional pressure on their economy. we saw things like traffic in our retail stores, traffic in our channel partner stores, reports of the smartphone industry contracting, particularly bad in november i have not seen the december number yet i would guess that's not good either >> cook telling cnbc that apple products have not been targeted by the chinese government. he added he's not worried about traveling there amid concerns between the u.s. and china he says he is optimistic about the broader macro picture, that's despite headwinds from the strong dollar and weakness in emerging markets. here's what he said about the possibility of a u.s./china trade deal >> i've had many, many

discussions over the course of many months to be constructive and to give sort of my perspective on trade and the importance of it to the american economy as well. i feel i'm being listened to in that respect i'm encouraged by what i've heard most recently coming from the u.s. and from china, and hopefully we'll see some changes. >> now apple shares have tumbled around 30% over the past three months, that's because the company announced it would no longer break out unit sales. tim cook defending that decision, he said to cnbc the company will be making other disclosures such as revenues of its growing services business. dominic, back to you >> so elizabeth, take us through the -- the reaction in europe right now. we're seeing that negativity carry out there, but it's not as pronounced, i'm noticing, in dax and cac and uk ftse 100 trading.

how is the apple trade playing out there? are we seeing the same panic that some people may associate with a company of apple's size reporting this kind of revenue shortfall? >> panic might be a stretch. we're seeing weakness in the broader markets here where that's coming from mainly are those stocks directly linked to apple so a couple of european chip suppliers are getting slammed. one stock is ams, down 20% earlier. looking at it, panic not so much in asia we saw some selling, but not across the board general weakness overall the concerns here are about the broader u.s./china trade dispute and whether other companies will be tied up in this as apple has. >> apple, elizabeth, is an american company with a lot of global operations, especially in asia how important do you think apple

is as a company to the overall tech atmosphere or landscape in europe we know it's a big customer for many suppliers >> it's hard to say how important apple is here because it's such an important player across the global markets. you can't talk about tech in europe without talking about apple. it's the number two market for apple. second biggest market for iphones, ipads of course europe, when it comes to the tech sector, there are other players in the market. huawei is gaining share in europe that's part of this bigger apple story. it is losing out to some local chinese players. in china it's the fifth biggest smartphone seller. so when it comes to europe, you're kind of caught in between this push/pull between apple and other smartphonemakers gaining share. the other dispute is over ip, which we have seen play out in

the qualcomm debate and in the munich ruling a couple weeks ago. no doubt europe is caught in the middle when it comes to apple. >> got you thank you very much, elizabeth shultze. joining me now is dan ives, apple analyst for web bush securities he has a buy rating on the stock with a $275 price target that's currently under review. you have been one of the biggest bulls on apple on the street how do you feel this morning about that call? >> it was an apocalyptic quarter. softness is something that we saw as well as a lot of come pettedt competitors in the supply chain. i think it was the degree of softness that shocked us now going forward, fundamentally there's a fork in the road you either view it as a sum of the parts, and that cook will be a pilot on the plane, cut prices, get demand back, focus on the install base.

if this pricing issue continues an they blame it on macro issues, that's not a good end to the story. >> how much of this in your mind as an analyst is about the micro versus the macro tim cook focused a lot on the macro concerns how much of this do you feel is specific to execution on apple's part as opposed to what's happening in the broader industry >> i view that 80% of this is apple-specific in terms of the pricing. fundamentally, in my opinion, it's the darkest day for cook in the modern iphone era, because they mispriced xr to such a degree, especially chinese consumers, they were expecting 50 million to 60 million upgrades, you only will see 20 million. chinese consumers said we won't

upgrade at these price points. even though there are macro headwinds, a slowing smartphone market, this is much more of an apple-specific pricing hubris, miscalculation rather than a macro issue. >> elizabeth brought up the idea that apple is the fifth biggest supplier of smartphones in china. other competitors are much larger how important is that china thesis to the overall health of apple going forward? >> china is the heart and lungs of the bull thesis it's about 20% plus of the overall iphone upgrades over the next 12 to 18 months which is why this hurt so much in terms of numbers and in terms of what the outlook is going forward china's key to the growth thesis for cook they need to go back in cupertino and fundamentally figure out pricing, what they're going to do.

we fundamentally believe a 750 iphone xr, the core price point is closer to 500, 550. >> cnbc's jim cramer spoke just last month about this idea that expectations, that chatter was already out there that apple would have to manage down expectations from their previous views. from an analyst perspective, you're a bull on apple, you still are pending this review of your target price and rating what makes you bullish or will you become more bearish on this based on the outlook we've been given on the record by tim cook? >> it's going to be easy to throw in the white towel across the board. we continue to be bullish fundamentally on the install base we view this as an install base, 750 million active iphones, 1 billion plus devices sold to date in our opinion, it's an install base sum of the parts story.

if you think the install base declines from here, which we do not believe, fundamentally you're negative. in our opinion, it's an install base and services story going forward. cook, it's the most defining period for him as a leader of apple. quite frankly n talking to investors, it was disappointing his comments, blaming it on macro, trade, everything else out there. instead of looking in the mirror saying this was our execution issue, we'll try to fix this >> over the last couple of months just about every analyst has downgraded the stock on apple or cut its price target. you were one of those analysts dan ives, thank you very much for joining us apple suppliers, you heard before, are also on the move this morning frank holland is here with those details. >> we're checking out shares of

apple suppliers in asia. starting off with foxconn, the biggest iphone assembler their shares falling 1.7% in taiwan today skhynix down 5% in south korea and sunny optical dropping almost 7%. so the apple news affecting i.t. stocks in asia and europe. dialog semiconductor, stmicro, iqe and infineon down. but shares off close to 20% for ams. in the u.s., skyworks, broadcom and universal display, which makes oled screamens. the primary supplier of the face i.d. feature, lumentum, down 8%.

retailers also getting hit on this news. back over to you >> thank, thank you very much for that. coming up next, much more on apple's big tumble what the tech giant's massive move means for the currency market we'll dive into that trade ahead. and we're all over market slumps the key levels you will want to watch and how you can best position your portfolio. stick with us. buy. and last year, i earned $36,000 in cash back. which i used to offer health insurance to my employees. what's in your wallet?

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if you are just waking up or heading into work, check out what's happening with the markets. futures pointing to a lower open the dow jones slated to open down by 355 points the s&p about 41 to the down side the nasdaq off by 179 points on the heels of that big apple news out last night they have reduced their guidance for the quarter. asian shares, the koz spi o by a full percent. the hang seng off by a quarter of a percent a bit more muted in terms of the moves there. the nikkei in japan still closed the on the european trade, we showed you earlier, the apple supply chain, a huge focus here. that's weighing on sentiment the dax off by 1%. the cac in france a similar percentage drop. the ftse 100 is down by a half of a percent. joining me now is dan morris

from bnp paribas asset management thank you for joining us how much of this sentiment in europe is being driven by the apple news >> well, i think it's going to be a factor just in general. it's not the kind of story you want to have at the beginning of the year after what we've gone through over the last several months you were hoping for a delayed christmas present in january and we're not going to get that. i think it's marginally negative for the perspective in europe. i don't think it will be a huge factor for the markets domestically in terms of the uk and continental europe, they will look for other catalysts. as we talk about the trade that's happening globally right now, there's a general sense of risk aversion. however the u.s. over the course of the past year or more has held up relatively well compared to other markets now the u.s. is playing catch up to the down side does this create opportunities that disjointing in the u.s.

versus the world and where would those opportunities lie given that kind of a situation >> absolutely. we had the big disconnect between the u.s. and the rest of the world through october 3rd when you had the huge out performance in the u.s a lot of that has reversed at this point, where we think there will be opportunity given the short moves in the market, it is in developed market equ y equities we're neutral on a strategic view but tactically overweight market equities. we think things have gone too far, that's not to say they can't go further to the down side, but there's opportunity. we would think more about emerging markets there you do see valuation opportunities. we know em has underperformed significantly over the last year, even if a bit better more recently valuations there and absolute terms look attractive. for u.s. equities, multiples are near averages.

>> how important is the oil trade to what's happening in that developed market versus emerging market thesis is it going to be one of the big themes you'll be watching in 2019 >> absolutely. of course the dilemma when you think about oil is there's a lot of double-sided coins, if you will on one hand if you think oil prices is an indication of slowing global growth, that's negative as far as the markets are concerned. on the flip side, the impact on inflation and inflation expectations the way the fed is looking at the u.s. economy and inflation, even if we think about oil as a more short-term factor, it does drive inflation expectations if falling oil prices keep inflax i inflation expectations low, that gives the fed room to pause. it's been worries about the fed, rising interest rates that have been a key factor in the selloff. if lower oil means less inflation and that means a more

cautious and dovish fed, that should be more positive for equities >> macro traders have a lot on their radar this coming 2019 dan morris, thank you very much for that update. >> okay. coming up next, we're all on washington watch a new congress kicks off as the government shutdown enters day 13 we are headed live to the nation's capital straight ahead. later on, big money risks in 2019 the top factors every investor needs to have on their radar this year. stick with us. i wanna keep doing what i love, that's the retirement plan. with my annuity, i know there is a guarantee. it's for my family, its for my self, its for my future. annuities can provide protected income for life. learn more at retire your risk dot org.

wall street will keep a close eye on what's happening now with apple and everything else because everything that's going on in the markets is being driven today by what's happening with china trade and apple plays into that discussion in washington today, a new congress is gaveling in as the government shutdown enters its 13th day there's a live shot of our nation's capital right now nbc's tracie potts joins us from our nation's capital with all that the congress has to deal with >> the new congress will be half controlled by democrats who say they will vote today to end the shutdown the problem is those budget votes are expected to go nowhere. as of this morning nine federal agencies remain closed both sides are digging in.

nancy pelosi expected to become house speaker when the new congress opens later today, emerged from a meeting with president trump with no deal to reopen the government. >> we are giving him a republican path to do that why would he not do it >> because it includes no money for a border wall. how long could this stalemate go on >> as long as it takes look, i'm prepared -- i think the people of the country think i'm right. >> reporter: today house democrats say they'll approve a plan to fully fund everything except homeland security, allowing 30 days of temporary funding there to work out the wall issue the senate won't even consider that >> it's exactly the kind of proposal you would expect if the incoming house democrats are choosing to stage a political side show. >> reporter: that leaves 800,000 federal workers without paychecks. for them, it's not about politics >> i'm actually not even a registered voter

i don't know i'm just a person not getting paid. >> reporter: for now, indefinitely the president tweeting about all of this, especially the wall overnight, saying there can be no real border security without it he says he's willing to work with democrats, let's get it done, he tweets. there is another meeting between lawmakers here and the president at the white house that's set for friday >> negotiations continued, tracie potts live in washington, thank you very much. let's check on the other headlines as well. frances rivera is live with the latest >> good morning to you we start off with this tragic crash in texas that left a single mother dead houston police say three unidentified teens were throwing eggs out of an suv when the teens say a driver flashed a gun and started chasing them while trying to escape the 14-year-old driver ran a red light at 60 miles per hour plowing into the car the 45-year-old mother was killed the teen behind the wheel was

charged with murder. investigators say he was driving his father's suv without permission. school buses were used to send a powerful message in georgia. they were trying to raise awareness of child sex trafficking. 72 buses represented a total of 3,600 children in georgia who are sold into sex sl slavery ea year. the tsa is looking to employ more floppy-eared dogs for airport screenings because the dogs with pointy ears "scare kids." the agency says they're making a conscious effort to train breeds like labs, pointers and golden retrievers because they're less intimidating dom, back to you >> frances, as the owner of two floppy-eared dogs, i like all dogs, pointy or floppy-eared >> all of the above. here comes the fallout from

that apple bombshell at least one of the first ones analysts downgrading apple to a neutral rating from a buy from macquaire. they say we're late but we can no longer recommend apple. ourfears about the iphone have been confirmed and the other shoe is about to drop on services growth. they took down their target price by $39, down to $149 per share. coming up next, currencies krau crushed. apple's rare warning hitting the currency market. we'll show you how and why there were the big moves that's aerft we come back on "worldwide exchange.

. apple stuns the market the tech titan rocking wall street after slashing guidance tim cook sitting down exclusively with cnbc as apple's stock plunges. we'll bring you his comments coming up straight ahead futures tumbling on the back of that apple news right now the dow is pointing to a more than 300-point drop at the opening bell and currencies crushed apple's rare warning sparking a mini flash crash in the currency market we'll dig into that big move on the yen.

it's thursday, january 3, 2019 you are watching "worldwide exchange" on cnbc. good morning welcome to "worldwide exchange." i'm dominic chu. apple stunning the market after slashing its revenue guidance citing weak iphone sales in china. tim cook spoke exclusively to cnbc last night and here is what he said. >> as we look at what's going on in china, it's clear that the economy began to slow there for the second half. i believe the trade tensions between the united states and china put additional pressure on their economy. so we saw as the quarter went on, things like traffic in our retail stores, traffic in

our channel partner stores, reports of the smartphone industry contracting, particularly bad in november i have not seen the december number yet i would guess that's not good either so that's what we've seen. apple down 8% in the premarket trade. that move is weighing in on the u.s. futures apple is a dow component, one of the more heavily weighted components the dow jones opening down by 343 points the s&p off by 40 points the nasdaq is where you will see a lot of damage being done the nasdaq down by 175 points. let's bring in darrell cronk from wells fargo thank you very much for joining us the interesting part about these moves, we will open down by roughly 1.5% for some of the

major indices here in the united states that's a stumble, it is not a tumble how much of this move in apple is going to reverberate across the markets? how deep could the markets shrink because of what's happening with apple specifically >> obviously it matters. it takes us back right to where we opened up yesterday morning on the back of weak pmi data coming out of china. so i'm not sure that it's a massive move lower i think the key for us as we just look at the apple news is the spill through implications to suppliers maybe more importantly two other components what it means for fourth quarter earnings season, which we're just getting ready to kick off in the next week, and also if apple or the tech sector can't resume leadership in the market, mathematically it becomes difficult to take out the old highs or move substantially higher we need to get new leadership,

new sector leadership that comes to the forefront beyond tech >> jim cramer, probably by the end of november i want to say, he had spoken about apple as one of the keys to seeing a bear market end do you think he's right? do we need to see apple really turn things around you mentioned we couldn't take out those record highs without apple. is apple that critical to the market what do you need to see out of them what does apple do to the overall markets if things continue to trade sideways to lower? >> i don't know that the market is fully just reliant on any one security, notwithstanding how important apple is i do think that tech leadership as a whole, we know it has been the darling, if you will, of the entire recovery, 20% plus annualized returns for the last 8 to 9 years of the cycle what we want to see is a broadening of the breadth

so places like industrials, financials, which arguably in 2018 had over 20% earnings growth, yet prices were down 13%, 14%, 15%, double digtdits. we think those poes nice vse ni in 2019. jim's right, it's important, but i think if we can see that inflection point and transition, it will be a good and healthy sign >> darrell, you're a chief investment officer, can i ask you to put your "what if" hat on for a bit? apple pre-announced these results. as a result they were meeting some expectations or chatter on wall street. the stock is down 8% as a result ifpple had saved this data and guidance for its actual earnings release date, do you feel as though apple's share reaction

and the market reaction overall would have been worse, at the same or better than the reaction we're seeing now >> i think the market was already pricing in a weak quarter specifically for apple to your question, had they saved it, i think it would have been worse. we would have been right in the storm of all the earnings season the market would have extrapolated what that means more importantly for q2, q3, and the rest of 2019 so if there has to be bad news, i think it's better for them to have preannounced when they d like they did, then wait for it to stream out in the earnings season which would have raised more question. >> darrell, speaking of streaming out, we know our nation's commander in chief, president trump, is a person who likes to take to twitter, social media, to put his thoughts out there. we want to play for you something that president trump said about the markets this past december and how he

characterized the action listen to what he said >> our country's doing better by far than any other country in the world from an economic standpoint we're the talk of the world. we had a little glitch in the stock market last month. it's still up around 30% it's going to go up, once we settle trade issues, once a couple other things happen, it will happen. it has a long way to go. >> president trump calls it a glitch if it was a glitch, hypothetically, what needs to happen in the markets in 2019 to restore it to its fully functioning cylinders firing se self >> i think a couple things number one, certainly i actually think the markets are underappreciating the true health of the u.s. economy we'll finish the year at almost 3% gdp growth, 20% s&p earnings numbers. i know we're looking forward

we think there is a slowdown in 2019 we think it's closer to 2%, 2.25%, 2.5%. that's a long ways from recession. the health of the consumer is good fourth quarter spending is coming in at over 3% you still have wage growth close to 3%. core inflation at 2% so the economy is doing well as long as revenues, the demand side of the equation hold up in corporate america, i think we'll be fine in 2019 for the markets. in fact, we may look back on this, dom, and say this was a very good buying opportunity we have now got equity risk premiums at over 300 basis points, but that's a sign saying you're getting paid very well today to take equity risk if you're an intermediate and longer-term investor >> darrell, thank you for joining us a lot to cover on this big

market day. time for the top trending stories. frank holland has those. we have a lot of stuff happening even with china on the trending front. >> i was about to say that normally trending is a break from the big news of the day, apple is all about weakness in china, but now we're going right back to china. a bit of a different take. their space program making a giant leap china landing a spacecraft on the far side of the moon for the first time in human history. the lunar, mro explorer touchinw overnight and sending these never before seen images of the dark side of the moon. >> cue in the pink floyd music. and barack obama is climbing the billboard charts the former president is featured on a remix of hamilton's one last time. he reads a portion of george washington's famous farewell

address. this remix was written and released by lin-manuel miranda it is currently sitting at number 22 on the billboard hot r&b songs chart. >> can i admit that i have never seen "hamilton" before >> i haven't either. >> my wife is a big broadway show person. i'm surprised we have not done it yet i don't find a lot of time to see the broadway shows, this is one i feel like i want to watch it >> everybody talks about it. it is the most wonderful time of the year -- no, not christmas. that's over. it's girl scout cookie season. the girl scouts have a brand-new cookie to offer. the treat is called carmel chocolate chip >> that's going to do wonders for my already burgeoning waistline from the holiday season >> i will give you more details. it is a chewy cookie with chocolate chips, carmel and just

a hint of sea salt sea salt is the big thing nowadays >> especially when you combine it with caramel. >> the new cookie also has the distinction of being gluten free >> that could be a selling point. >> is it gluten never hurt me, but caramel and chocolate chips have hurt my waistline. >> one of our producers is a non-gluten person, so this may be one of those cookies she has to buy in stockpile. >> and share with her "worldwide exchange" family >> of course frank, thank you very much for those trending stories coming up, are you seeking safety our next guest has a few golden opportunities for you and your money. as we head to break, a check on the dow winners and losers there are more red specks than green ones on the board. "worldwide exchange" will be back (client's voice) remember that degree you got in taxation?

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the impact of a slowdown in china. check out what's happening with gold prices hitting a six-month high as concerns about global growth and volatile equity markets boost that safe haven buying those trends continue. a weaker dollar probably helping there as well. let's talk more about that gold trade with joanie tevas as we talk about what's happening with macro, is there a place trend-wise that you have seen this real flight to safety? has it opiniit been the yen, go, treasuries, or all of it >> i think gold's move over the last couple of months has been interesting. one of the biggest disappointments with gold last year was that it wasn't acting as a safe haven. but as we headed towards the end of 2018, this started to change. i think certainly the rally that we've seen the last couple of

months does indicate that gold is starting to reassert its safe haven status against the backdrop of a pause in the dollar strength, the backdrop of weaker equities, and lower rates. >> as we talk about the gold trade, like you mentioned, last year it was not a beneficiary of some safe haven buying has gold become or is gold remaining one of the best precious metals to be in are there other opportunities outside of gold? >> from a macro perspective, i think gold is attractive, especially as investors start to consider the cycle continuing to mature and the prospects of moving into the later stage of the cycle. but in terms of fundamentals, i think another precious metal that has attracted a lot of attention last year was palladium. supply and demand fundamentals for palladium are strong that has been well reflected in

prices also it does benefit -- the whole precious metals complex gets spillover benefits from gold's strength. from a macro perspective, i would say gold is probably sort of the key precious metal to watch. >> joanie, many times i've been given the opportunity to perhaps buy or sell gold coins as people look at some of these precious metal markets, the tangible thing that some investors can buy is coinage silver is more accessible than gold should people be looking at silver as a possible alternative if they don't want to pay the per ounce prices that gold commands >> silver is quite interesting it's performance last year was basically it got caught between gold's relatively range-bound price action for most of the year, but at the same time it

has been influenced by the performance of industrial metals at the end of the day, the demand for silver comes mainly from industrial applications, so it tends to track what's going on in base metals as well. but in the scenario where you see gold continuing to strengthen, especially if that also -- you do see bouts of risk sentiment starting to improve, silver can perform quite well, particularly because it has underperformed last year, this could attract some sort of catch up trades from investors >> joanie, before we let you go you as a global macro strategist do cover cryptocurrency as well. we know about the carnage for bitcoin back in 2018 maybe some thoughts on your outlook for crypto in 2019 >> coverage is quite a strong word here.

we did publish a piece last year looking at cryptocurrencies, particularly bitcoin and what tends to drive price action and what we found in very simplistic models that we put together is that the bulk of volatility in bitcoin prices are actually driven by speculation. it has been the key driver for the sharp rally in bitcoin prices and also the sharp collapse it's difficult to say from here and just to explain, we don't really cover it officially the piece that we did put out was more of an educational piece trying to answer the question what is bitcoin, is it an alternative new investment vehicle or is it an alternative to money >> all right thank you very much for those thoughts on metals and crypto.

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deere, micron. they could be some of the movers in this morning's trade. that's why we're seeing those sharply lower markets this morning. the dow pointing to a 350-point drop at the opening bell if these losses hold into the opening bell apple's move sending shockwaves through the currency market the japanese yen surging on the back of that apple bombshell let's bring in tim seymour from seymour asset management and a "fast money" trader. the moves in dollar/yen and australian dollar versus the yen and turkish lira versus the yen, they have caught a lot of traders by surprise. tell us what happened. >> good morning. i think the bottom line is you do see currency markets start to enter the fray here. clearly dollar/yen is a sign where you see the yen strengthen against the dollar it's a risk-off trade.

we had these flash crash type dynamics 3.5% move in any of the major crosses is an extraordinary move beyond a standard deviation event. when you get this move, it tells you that there really was an impetus and catalyst if we want to blame this on algos, that's fine looking at dollar/yen, this is not just a flash crash this is an almost 8% move in 30 days as it caught up to the move in bond yields that tells you there's a big concern about slowing growth dollar/yen is really this class class classic risk-on, but also this funding trade that we have known since central banks were washing the world with liquidity aussie dollar is down about 9% over 30 days, a major move >> 9% over 30 days, that may make sense from a macro trend perspective. 4% to 5% in a matter of seconds to minutes does not scream

fundamentals, it screams something technical. just take us through what exactly the conditions in the market and liquidity have to be for a flash crash like this to happen in an otherwise liquid currency market. >> this is a rare event and something that should add another level of concern for investors that have seen the type of volatility over the last two weeks. that is not something that will give confidence to markets this is not something you see in a bull market. we're still two trading sessions into a new year. this is a quiet holiday abbreviated week liquidity is thin. fx markets are some of the deepest in the world when you remove that dynamic, and some of the other parts, u.s. traders may be hard at work other parts of the world shut down let's take some comfort in the fact that there's a major liquidity dynamic here i would look more at the trend and say where the machines are pushing and where the headlines are not comfortable.

24 hours earlier or less we had pmi data out of china which was at a 17-month low. showed a contracting economy we had four other major economies in asia that showed a contraction in their economic advancement. this is not necessarily a one-day event. if you want to call it a flash crash, call it what you will it's the type of event that you could get in a quiet liquidity environment. >> tim seymour, thank you very much for joining us. >> a lot to talk about >> it's going to be a big day. that does it for the show. let's take a look at futures apple will be the theme. the stock to watch as futures point to a lower open, the dow jones slated to open down by 361 points the s&p off by 41 points the nasdaq 176 points. the chart of apple, premarket we're down just off the lows we've accelerated the decline a bit, down by 8.2% or almost $13

per share. $144.95 the last trade there "squawk box" picks up coverage next it will be a big market day. we'll see you tomorrow super. but today you're building wind turbines. morning sir. chief, the blade isn't passing quality gate. that's why you work with watson. i detect frictional loss on the midspan. it can detect the tiniest defects from just a few images to help production stay on time and on budget. i optimized the fiberglass finish to reduce frictional loss and maximize airflow. i was also part of the maximizing. for ai that can do more with your data, choose watson. hello. the best ai for the job.

good morning we'll call it breaking corporate news apple slashing its revenue guidance blaming weak ix phoiphe sales in china. the tech giant is taking a bite out of the broader markets. the dow futures pointing to a more than 300-point drop at the open it's the same 300-point drop from yesterday we eventually closed up yesterday. we're back down. in washington today, a new congress will convene as the government shutdown enters its 13th day it's january 3, 2019, "squawk

box" begins right now. ♪ live from new york where business never sleeps, this is "squawk box." ♪ >> all right good morning welcome to "squawk box" here o cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and mike santoli. andrew is off today. equity futures are down sharply after the drop in apple shares and that warning about what's been happening in terms of sales and revenue there. dow futures indicated down by 370 points yesterday the futures made a stunning recovery from these levels they ended the session in positive territory though. that's the biggest advance you've seen on the first trading

day of the