zpliencht hello, and welcome to street signs these are your medicals rsh stocks across europe sit mostly in the red as china's march trade surplus soared past expectations with data showing a strong rebound in exports and a continued decline in imports frercthe french finance min says the e.u. must work out the trade spout as president trump threatens tariffs of $11 billion worth of european goods.

>> tit for tat sanctions would lead nowhere carlos ghosn dees tension giving prosecutors more time to decide whether they want to press formal charges against the former nissan chairman two top executives are -- of defrauding investors, including the bill and the linda gates foundation good morning let's have a quick look at the china trade data we saw china's exports blowing past expectations in the months of march rising 14.2% year-on-year imports for the period dropped by more than anticipated to

7.6% now, according to reuters calculation based on the official data, china's trade surplus stands at 32.64 billion dollars for the month well above estimates. let's have a look at a couple of european stocks that have heavy exposure to china among them pretty much flat a little higher here some of the minors of glen corps taking just a tad higher elsewhere chinese auto sales fell 5.2% year-on-year in the month of march this is the ninth consecutive month much declines for the world's largest car market according to china's association of automobile manufacturers, sales dipped around 2.5 million vehicles bmw off by just a fraction daimler off by 0.2%. once again, i think these stocks are really taking the data in stride much of it obviously has been priced in over the last couple

of months. let's stay with china. a larger than expected slowdown in china is among the biggest risks to global growth the fund's deputy manage managing director says that while the outlook was uncertain, beijing does have the tools needed to support growth other chinese risk areas include the potential for a sudden tightening of market conditions if u.s. trade talks collapse now, the chairman of ubs, though, he has sounlded very, very optimistic. jumana spoke with him at the spring meeting and asked him whether china was on course for a hard landing take a listen. >> i've heard so many hard landing discussions are not china that, you know, even when i started in 2004 and governor joseph was asked hard or soft landing, he said no landing, and he was absolutely right. i do see that the fiscal monitor stimulus in china is going to work out china is recovering. the trade dispute with china is -- looks like it will be

resolved at least on the trade side some of the dark clouds over the chinese economy are disappearing for us at ubs, because we had a strong asia and a strong china presence was the diversification didn't help, but when the economy came down over the end of last year, the recovery that is v-shaped and different shaded emerging markets are already rebounding we're benefitting from that. we're seeing that once diversification across business and regions didn't help us to protect on the down side, we are benefitting it at a different speed from the recovery that is there. i'm not concerned about asia pacific. that is recovering >> let's have yet another voice weighing in on the china question great to have you with ut show where do you sit on china? sond lafting hard landing

is stimulus working? >> the stimulus is being quite slow to come through, but we are seeing signs of it coming now. you know, the credit impulses positive we're starting to see it in some of the softer data as well i think the chinese import data wasn't a huge supporter of that theory, but nevertheless, there's enough there, and history suggests that china stimulus does come through eventually >> we want to go back to the data this morning because it's mind-boggling how we are seeing huge swings from one month to the next, and obviously every year you have to take the first couple of months of the year with a grain of salt because you get the distortions from the new lunar new year holiday again, would you simply look through some of the volatility that we've seen in the data? i mean, in february we saw a decline in exports and 20%, and now we're up 14.2% in terms of export growth. >> yeah, i think you have to see through some of the data, and i think your presentation of how actually prices respond is broadly consistent in the end i think, yes,

surprised on the up side of the exports. it's the imports really that i think for the rest of the world that really matters. china is just so impossible to underestimate how important chinese -- china is in terms of driving global trade and its imports. you know, so much to the chinese business model that is probably positive and other stuff that probably other countries couldn't really copy i do think that the gradual rebalancing is going just about as well as we might expect in

the chinese economy, and, you know, the fact that they've -- every time there is a big down turn like the -- you do worry what's going to be exposed we've got through that you know, i think that going forward, you know, 2019 h2 will be better. >> i want to broaden out this discussion we talk a lot about the disconnect between what we're seeing in the equity markets and the bond markets just recently as recent as, like, three, four weeks ago we saw an inverted yield curve. everybody was worried about the recession. yet, in the equity markets we're going from highs to highs. european markets at eight-month highs, and u.s. markets not too far away from their all-time highs. which asset is right at this point? >> well, with yields going lower and lower,ing of course, in some ways that's good for equity markets. you know, it's good for pe ratios so long as growth doesn't get destroyed, and, of course, the nervousness about the yields going so low and inverted yield curves on the verge of recession.

now, our take on that is that actually probably we completely respect the history of yield kushds and accuracy, and there are good reasons why that's leading indicator that's weaker. you have very structurally low yield low risk term premium yields, so that means that you more likely to get inversions. taillight part of that reason is lower volatility that lower volatility also applies to global activity i don't think you get as many recessions basically i think, you know, what our strategists have done really good work on is saying you're getting low volatility. that probably means more inversions, fewer recessions yes, it's a worry, but not quite as big a worry as it has been in the past >> your notes, you say good-bye gray skies, and that's in part because you believe that stimulus and china is working. is it all going forward, or could it be hazy because there's still many risk factors on the horizon? >> still many risk factors, and we're not heading to anything wonderful. i think, you know, i'm a

believer partly in the secular stagnation hypothesis, but what i who say is if you think of all those things that really hurt the global economy last year, there are a lot of gray clouds you can look at the temporary factors in europe you have meerjing markets being horribly hit by the financial reversals the tlar is strong terrible for the world economy the if chief economists has pointed out. none of these are -- have turned out to be systemic, and therkd fade, and that should be better. the only thing that is really going in the opposite direction is the u.s. fiscal still lurks which just has to come off, i think, this year >> and can't be replaced by any other nation, it seems especially not the likes of germany or japan >> exactly so there's not enough strong fiscal policy in the world especially from germany. good that we get that in the imf don't get it in enough, i think, and -- >> there's a lot of germany

backing going on gabe yell, we'll have to finish it up here thank you for your contribution, and a lot of food for thought. gabe yell stern, head of global macroresearch. let's see what the equity markets are doing. we're one hour into the trading session, and we are evenly split between gainers and losers at this point not a lot of movement on the stock europe 600 we're currently down by less than 0.1%. maybe more direction for european stocks when we're seeing the kickoff of earnings season later on tonight with jp morgan and wells fargo reporting, of course let's have a look at the individual markets and see how they're shaping up the central dax is off by nine points the ftse 100 off by ten. the cac 40 is flat as a pancake. when it comes to the sectors, this is the picture. technology, basic resources on the back of china doing a little bit better industrials also up by one-third of 1%. on the down side we've got a defensive sector telecoms off by 0.6%

retail also off by a similar percentage amount. now, i want to bring you some interesting comments coming from the german economy ministry. they're saying the state of the economy is mixed well, no surprise here they're saying the industrial sector is going through a weak phase, but the domestic impetus remains strong also, adding that the order levels of business expectations point to continued weakness in i manufacturing sector and the production in the first half of this year will be significantly weaker than at the same time a year ago maybe one last final point saying that indicators point to subdued exports in the coming months this really is just a reaffirmation of what we've already seen in terms of data points and the last couple of weeks. they're coming from germany given the softer than expected pmi prints, but also the industrial orders. now, european ambassadors have reportedly given the green light for trade talks to begin with the u.s that's according to multiple

reports. the initial clearance for talks comes amid criticism from president trump over e.u.'s trade practices. european ministers will formally approve the decision at a meeting in brussels on monday despite initial resistance from france and the french finance minister says a trade war between europe and the u.s. would be a mistake. speaking to cnbc and washington he said he will seek a compromise with u.s. trade officials. >> we should do our utmost to avoid a trade war between the u.s. and europe on this question of sanctions and tb a case for airbus a tit for tat sanction would lead nowhere and would weaken the growth both in the u.s. and within e.u ly propose to my friends,

especially to bob lighthizer i will have a meeting with him tomorrow morning to enter into a negotiation and to do something to found a consensus and a compromise between the u.s. and the e.u we have to avoid a trade war we are facing, as you just said, a slowdown both at the global level and at the european level the reason why there is such an economic slowdown is that there are trade tensions all over the world. there are trade tensions between the u.s. and china we should not add new trade tensions between the u.s. and the e.u. it will be a political mrs. take and an economic mistake, too >> meantime, the imf's managing director christine lagarde says the macroeconomic situation in russia is healthy. speaking in washington at the spring meeting lagarde add thad more deep and structural reforms are needed to boost russia's growth potential

in january the imf downgraded the gdp forecast for 2019 and 2020 jumana spoke with the russian finance minister in washington and asked him how he thinks the russian economy would be fairing if it weren't subject to so many sanctions. >> translator: they would have clearly been much higher the question is how much higher. there could be different views on this, but there is no doubt that the reduction in the inflow of private investments, reduction and foreign investors participation in our projects had a negative impact on the economic activity both in russia and in the countries whose investors would like to work in russia and invest in the russian economy. clearly, trade restrictions, protectionism, transported decisions that curb economic tooit benefit no one we discussed this in our first ministerial meeting of finance ministers and head to central banks devoted to macroeconomic issues >> was there a sense of relief

amongst the business community within russia as per the mueller reports came out in the united states with no further indictments of russian officials? >> well, we have never had any doubt in the conclusions of that report, on the one hand. on the other hand, i think that it is not really about the results of that investigation. the problem lies with overallstate of relations between our two countries. this is not the best climate for business development this is why i don't think the outcome of the report has had much impact on the general mood in the russian business community. i think that we need to strengthen our links both economic and political links, between the u.s. and russia. this would be of been if it to the global economy and to our countries, our people, and our entrepreneurs, first and foremost >> you said that one of the impacts of the sanctions was less investments from the international community going into russia. now with some clarity on the mueller report, are you expecting foreign inflows to

resume >> i have already mentioned the fact that this is not about the results of the mueller investigation. that, by the way, confirmed once again that russia had nothing to do with the results of the u.s. presidential elections it is the change in the overall rhetoric in our relations that is the problem we can see that the results of the report have had no effects they have not led to any willingness to stop the sanctions that are coming out of the u.s. we shall have to wait and see how things pan out, but so far we have seen no changes in the matter of restrictions imposed on russia. >> we are going to go for a quick break, but still coming up on the show, the u.k. government winds down its no deal planning team after britain agrees an extension to brexit. plus, cnh industrial holds its agm later on today as the capital goods firm looks to develop its long-term strategy juliana will be speaking to the ceo after this short break my mom washes the dishes...

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party today in the city of covent coventry he formed the brexit party earlier this year after leaving u.k. the brexit party has previously said it plans to contest every seat in the upcoming european election the british government has stood down 6,000 civil servants working on the no deal brexit contingency plan that's a big number. with brexit now extended until october 31st, the no deal preparations which are estimated to have cost $1.5 billion pounds are now being wound down the e.u. economic commissioner has also given his take on the brexit extension telling cnbc the next six months will be used to prepare businesses for a potential hard brexit. >> no deal is not the good option we must really find a way to live together and for that deal i don't know which deal. it's up to them to say precisely what they want it's much preferable to a no deal our responsibility is to be

prepared because even if we don't wish it, that won't happen by accident as we did do not reach a common ground. we could have had a no deal that would not have been such a problem for the e.u., but it would have been a problem for all of us, and and it will be a problem tomorrow let's avoid a no deal. >> spanish baik says it will issue up to $572 million u shares to finance the voluntary offer.

mexico accounted for 8% of the lender's 2018 earnings and the move is part of the bank's latin american growth strategy now, tokyo's district court has extended carlos ghosn's detention. prosecutors will now have until the 22nd of april to decide whether they want to bring formal charges against the former nissan chairman ghosn was arrested for the fourth time last week amid allegations that he redirected money to himself through oman. uber making plenty of headlines over the last 24 hours. uber may never make a profit that's according to its initial public offering filing the documents reveal the ride-sharing company has 91 million monthly active users almost five times that of its rival lyft, but that growth is slowing and operating expenses are expected to increase significantly. uber didn't specify the size of the ipo, but said a place holder of $1 billion. according to media reports this week, the company plans to sell

around $so million of shares valuing the company at between $90 billion and $100 billion we have all the details you need to know from the ipo filing. head on-line to get the full rundown. the countdown is on to the highly anticipated final season of game of tloehrones the hit hbo series returns on sunday after a two-year build-up with fan excitement reaching fever pitch. full disclosure, i've never watched it, never will i don't share in that excitement, but, hey, anyways, plenty of you probably do. julia borestein has plenty more in this story.

>> game of thrones, which saw over 30 million viewers last season, returns for its eighth and final season sunday after being off the air for nearly two years. hbo's betting big on marketing with a reported $90 million marketing budget for subscribers and its streaming service. one area hbo is spending millions on, immersive experiences. sending fans on a global scavenger hunt and encouraging viewers to travel the world to find one of the six iron thrones that have been hidden in different countries. >> fight for life. >> the company also building an immersive experience and blood drive at south by southwest last month. in partnership with the american red cross to entice fans to experience it for themselves >> one of the reasons that audience keeps building is that game of thrones is not just a television show. it is a lifestyle. it is -- it has penetrated country you will too tour in all

these different ways >> a range of brands are taking advantage of the show's cult following collaborating on everything from apparel to food and drinks adidas creating limited edition shoes with themes for the different houses in the show battling for the throne. johnny walker created a special white walker themed whiskey. oreos got in on the action by producing an oreo themed open for the show it's selling limited edition thrones oreos in stores. and mountain dew created this cold activated can in which aria's kill list appears once refrinl rated. it's inviting fans to enter a sweeps stakes to get their hands on them. hbo is betting its marketing tactics will help attract for subscribers to its services, but retain them once the show is wrapped. >> the hope is not only that this end of game of thrones will bring some people to hbo as new subscribers, but also the idea is that hbo is going to want to

make sure it keeps its subscribers. >> working against hbo's efforts, new data from second measure shows hbo now sees a big uptick in subscribers before season premiers, but then has a hard time retaining them last season subscribers fell into a decline for six consecutive months following the final episode. with big questions about what will fill the void once game of thrones ends, plus who parent company at&t will hire to fill the voidof a number of key empty roles puts more pressure on hbo to market this last season and to add new subscribers. julia borestein, cnbc business news still coming up on the show, senior executives from insolvent abroad have been arrested on u.s. fraud charges we will be crossing live to deboo with the latest. we'll be back. ♪

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♪ applebee's bigger, bolder grill combos. now that's eatin good in the neighborhood. hello, and welcome back to street signs these are your headlines stocks across europe sit moechl in the red as china's trade surplus soars past expectations with data showing a strong rebound in exports and a

continued decline in imports french finance minister says the u.s. and the e.u. must work out their trade spat as president trump threatens tariffs on $1 1 billion worth of european goods. >> we should do all to avoid the trade war tit for tat sanctions would lead nowhere and would weaken the growth both in the u.s. and within e.u. uber files for its ipo as the ride-hailing giant reveals revenue has plateaued and warns it may never turn a profit finally, two top executives of abraaj are arrested on charges of defrauding investors, including the bill and melinda gates foundation

good morning if you are just tuning in, we're roughly one and a half hours into the trading day tgif this was a busy week for investors. we had fed minutes we had the ecb meeting plenty of drama -- drum roll towards the start of the corporate earnings season. especially in the u.s. we're hearing from a flof banks today. that will give the markets more direction. this t at this point we're treading war the stock 600 is flat at this point in time. we've got loseers and gainsers this is where we're seeing a bit of a -- oh, no this is the index. ftse 100 to be honest, the better than expected trade data coming out of china didn't move the markets that much. we had it priced in, and obviously there are a lot of distortions in the first three months of the year given the lunar new year holiday

we are seeing a surprise uplift in the euro dollar 112.97 almost at the 113 handle this is on the back of reports saying that mitsubishi ufj's financial group is planning the purchase of the aviation financing business of germany's bank as of june last year. that business stood at 5.6 billion euros. yesterday very much a flat day, but, hey, look at the dow jones. it could open higher to the tune of 115 points that the point again, all eyes on the banks today as they kick off the earnings season for the first quarter. the s&p 50000 by almost nine points the nasdaq could open higher to the tune of 21 points. fiat chrysler is holding a meeting later today amid reports linking the carmaker to potential tie-ups with psa and renault. it's partially owned by the same holding company of fiat, and

it's also holding its am told. cnh said an economic slowdown would weigh on its business. juliana is in amsterdam with more hey, juliana >> good morning. yes, i am now joined by ceo of cnh industrial for a little more insight on just that thank you for joining us this morning. you must have strong insight into the health of the global economy. are you seeing any signs of the significant deterioration in economic conditions. >> there's a lot of uncertainty, obviously, around, about ut we're modestly positive for 2019 the construction markets are holding. they are holding in north america, and they are even stronger in europe than we anticipated. the ag consuultural demand is -- what we all need is a great deal with china, so we're hoping that this gets behind us very, very soon and that we're going to have a strong deal we're just going to be good for

both countries and the world economy. >> how is the u.s.-china trade war affecting your business? >> it is affecting u.s. pharmas right now. soft commodity prices are still not where they should be actually there are other regions in the world that are benefitting from that. south america, brazil specifically, it agriculture is benefitting right now from that trade war because a lot of the soy bean demand moves from the u.s. to south america. i think it's in the interest also of the american pharmas that a trade deal gets finalized very, very soon. >> from your perspective as a manufacturer with supply chains all around the world, are you having to pass on higher costs to your customers? >> yes, and we have done that. in the end the end customer has to pay for that, so we had surcharges on steel, obviously, and we have to give those costs, and they just drive inflation. that's the reason why i can only emphasize it once more a trade deal needs to be found it will be essential for the health of the overall economy. >> now, you are in the midst of a strategic assessment of your

businesses where the capital markets stay due later this year are there any sacred cows in your portfolio >> no, i don't think so. we're a leader in the off highway and the on highway with second largest agricultural manufacturer we're the largest construction and equipment manufacturer, and we're very strong on the commercial vehicle side. actually, what we see is there are similar trends that are affecting all of our businesses, and we're heavily vesting in them it's a good alternative to dees ill. digitalization is in our industry agriculture is something driving our end customers, and we're investing a lot on there in the end it's also about automation.

>> is there anything you wouldn't consider exiting? >> we are doing a portfolio review now we are consider all of our business for the time being core we analyze what we have to invest in the long-term and what the synergies are, and that, you know, total investments minus the synergies will define the future look of the portfolio going forward. we are going to remain in capital goods for sure, and one thing is clear, we are already one of the largest agricultural manufacturers, and that's for sure one of the core businesses that we have >> very clear message you gave on the u.s.-china trade front. what about u.s.-europe we've seen the u.s. rachet up pressure on the european union in the says last week. how is that situation going to evolve >> the same concern there. i think we have to find an agreement. i mean, there we are really in

the same situation we have to find a great deal we're very concerned if there is is not a trade deal found. that the actions will go against the u.s. pharmas, and this is not in the interest of the united states. >> they have been raed in the u.s. for allegedly defrauding their investors, including the bill and melinda gates foundation let's get more on this story with dan who joins us live from dubai. dan. >> carolyn, art was arrested in the united kingdom these charges in the united states now, he is also now waiting on a possible extradition to the u.s. in order to face the charges, which include the likes of

securities fraud, wire fraud, and conspiracy according to court documents. at the same time we've also learned that his alleged accomplice mustapha abdel, who was a former managing partner at the now collapsed abraaj was also arrested and charged in new york in connection to these alleged crimes it's claimed here that more than $200 million was essentially moved to cover liquidity shortfalls in abraaj and was also used for the personal benefit of mr. naqvi and abdel and their inner circle, but the "wall street journal" has also previously reported that up to $600 million was moved around the business without the knowledge of most of their investors. now, carolyn, this is a major development in this saga that tha has been ongoing for some time certainly sent a lot of shock waves through dubai, the dubai international financial center where we're based right now, and also, the broader middle east because this has significant consequences not just for the trust in this region, but also for issues

around compliance in the middle east more broadly. abraaj was also one of the biggest private equity firmgz in the middle east with about $14 billion under management on behalf of its clients, including the likes of the bill and melinda gates foundation, but it did collapse quite spectacularly. it also left a wake of unanswered questions, and investors are also now looking to recoup some of that money of course, it was the investors that essentially uncovered these string of misappropriations and claimed that their money was mishandled, which is how this came to be in the first place. of course, the regulator here in dubai has always said that it has acted appropriately. however, we will be looking out to see whether or not there's more commentary coming from the regulator on this and any reaction across the middle east as well. back over to you for now, carolyn. >> dan, wow, what a story. thank you so much for that now, let's switch gears. the pharma industry is still vulnerable to market and technology shifts. that's according to the global 100 report this is a report on how health

care companies are shaping the future of health care, and i'm very glad we're now joined by one of the authors, john roundtree, managing partner at nova -- sectal we're seeing so much disruption whether it's in the automotive or financial services, but also in health care how is that being documented how is that -- how does it manifest itself? >> the interesting thing about these 100 companies is that they're all dealing with that in very different ways. in the u.s. you find that companies are looking to these disruptions for massive growth and companies investing. a lot of it a lot of capital going behind it in terms of deals and m&a. in europe and the says rest of the world people are playing a slightly different game. they're trying to hook to that with the capital markets, but they've also got this, if you like, burden of legacy from their old products and their old businesses and their old sales forces that they've got to deal with as they actually wrestle

with the same innovation challenges as their u.s. counterparts >> so there are essentially a couple of ways to pursue this growth through m&a or organic growth both somewhat expensive, and i know that we've seen a lot of deal flow involving some of the biotechnology companies. you know, for example, roche buying spark therapeutics. does it make sense are valuations still low enough? >> i think the evaluations have been very high for the last couple of years. they're coming off a bit even so, the m&a is still very expensive. i think the challenge for these companies is that the mega m&a of cost cutting and the sort of traditional way is not really available to these companies they've all got their own saying, and the market don't like those mega mergers, and indeed, novartis has basically said recently that they're not going to do it bms cellgene has had a lot of flack for investors. it's going to be in the smaller

biotech fears and the collaborations small both on acquisitions is the way to go for some of the big pharmas, as well as collaborations, just partnerships very interesting deal between regeneron and instead of having a straight-out acquisition, these are collaborating, and that's a strong sign for the future that people focus on what they're good at and then collaborate for the other pieces >> so you're not necessarily taking on the entire risk by buying the company also, bigger isn't necessarily better, i guess. >> not in pharma, and i think there are limits to growth at the top. what we've seen is that although this is a healthy group of companies and the growth is sort of 6% over the five years, at the very top it starts to slow down, and these top companies are struggling to find ways to grow because you can't do it through big m&a because the investors don't like it, and it's really hard to do it through organic roots because your patent is expiring, and suddenly you have big products, and sort of as if they've got no revenue anymore, and that's the real challenge in this industry. i think it's going to mean lots

of change in those top ten in terms of how they deal with this challenge, if you like, in the pharmaceutical industry. >> how scared is big pharma of some of the big tech companies like apple because they might be eating their lunch, and they're partnering with some of the smaller start-ups, which are very, very promising we've seen apple making a splash in that scene as well. how big of a threat is that really >> i think it's a long-term threat, and the pharma industry is sort of the health care profession that's notoriously slow to adjust to change however, the tech players are eating away at the various segments, and i think what the big pharmas have to do is respond to that by ino vating in their own way and finding a role for themselves that involves the customer as well as just the simple what they used to do, which is essentially develop and commercialize drugs. the tech players come from a customer and consumer platform, which i think is going to be very powerful as we see in health care, whereas the legacy of pharma is more we develop and sell drugs

you've got to see those two going. the health care have an advantage. sorry. the tech players have an advantage in that space. >> you know what really surprised me in your report is you said that pharma companies at larger health care companies, they're still highly profitable. we're seeing even margins of between 50% and 30%, yet at the same time there are so many challenges for example, the crackdown on drug pricing, but also so many companies facing the patent cliff. how do you combine the two how does it actually work? >> i think the reality in this industry is that the profitability has ochbl come in the more old established pharmas from older products. they go on and on. you know, there's very good gross margins on those, and they invest in rnd behind it to try and create the next one. it remains very profitable industry as you say, 15%. it's the median of profitability. a lot of other industries would envy that. that doesn't stop them having growth challenges, and i think that's the interesting part of this industry. >> john, thank you so much for

that john roundtree, managing partner at nova. still coming up on the show, the federal reserve's vice chairman plays down the need for a rate move telling cnbc the economy is in a good place. more after the break (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. ...it's making her do hard work... ...and getting paid for it. (vo) snap and sort your expenses to save over $4,600 at tax time. (danny) jody... ...it's time to get yours! (vo) quickbooks. backing you.

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>> herman cain is going to remove his name from consideration for a place on the fed board. that's according to abc news now, this comes after a fourth republican senator said he would oppose cain's nomination north dakota senator kevin cramer told reporters on capitol hill that he would vote against the former pizza executive if he had to vote today. , and fed vice chairman richard claritta says he sees no need for a rate move in either direction, speaking to cnbc. clarida backed the patient's economy and is doing well. >> this expansion is now in july this will be a ten-year plus expansion. the longest in u.s. history. so perhaps people are

conditioned to thinking as these things go on, there's more of that risk. >> bank of america and black rock will then report on tuesday. on wednesday it's morgan stanley and bny melon to cap it off. let's talk more about what to expect with the ceo. thank you so much for joining us this morning so we know that trading for the u.s. banks was pretty ugly in the first quarter. jp morgan warning of a high percentage fall in trading revenue. we didn't hear much better news coming from citi i guess the bar is pretty low. does that mean there is plenty of scope for positive surprises?

>> i think there's far more scope for negative surprises than this front. we've heard some of the investment banks, ubs will announce that their investment banking revenue will be down by one-third overall. that's the most forecast we've heard from investment banks. a whole bunch of activity slowed down tremendously. activity basically dried up in the u.s. and globally down quite significantly. in europe it almost disappeared, and that's going to hit the very u.s. investment banks very hardly.

>> i wouldn't expect anything in terms of the u.s. investment banks. that's not the case perhaps with the european ones who have seen a much harder first quarter, but i think we'll just see a basically wait and see strategy and maintain a different strategy there, and we'll wait and see how the second quarter unfolds. >> i want to also talk about the lending side because there are a lot of question marks about where the u.s. economy is headed the fed has recently turned very, very dovish.

>> the default rate on some consumer loans that ticked up slightly so you look at credit cards and things of that sort. the default rate has ticked up 2.5% that's an increase over where it was six months ago, but that's still a very low rate. >> the real issues on the capital side, that's going to be a rough first quarter. the more exposed the bank is to that kind of activity, the worse the results are going to be in this first quarter

>> finally, look, we know that banks very much thrive on a steeper yield curve. that is not necessarily going to pan out the way that we expect for the rest muof the year givig the changing stance of the fed how much of an issue is this going to be for the banks? >> i think right across the board it seems that the fed is really determining how bank earnings are going to unfold they are really watching the fed very, very closely i think a lot of larger banks were caught somewhat flat-footed by the change in stance. most banks at the beginning of this year were very much expecting increases in terms of integrates and see the fed carrying over and racheting up the interest rate. a lot of that will and i'm somewhat surprised that's the direction the fed has gone in. really in terms of driving the markets, in terms of driving lending activities, it's all about the fed really, and that's what everyone is watching at this stage i expect to see the fed continue

this strategy where they're going to be basically flat and unchanged. that's the feeling that we're getting from the fed that means some of the bairngs are going to have to adjust their interest rate strategies and pay the account in the second quarter they lead on six under par with a host of big names, including tiger woods remaining in contention adam reed can tell us plenty more >> yes, absolutely as you say, there's a whole host of americans near the top of the leaderboard. brook koepka is leading the way, and what a year he has had three major titles in that time, and he is there again at the top of the leaderboard missed the masters last year with a wrist injury, but showing no signs of ring rust in this tournament as well top of the leaderboard as he is. bryson, he had an excellent end

to the year last year winning back to back titles in the fedex cup playoffs, and he is doing very well. looking for a maiden victory, and for someone so inexperienced around augusta, he is performing excellent as well. we can see a little bit of his opening round now because just coming off the 18th, the final hole, this was his approach shot, and as you can see, almost finding its way into the hole. just stayed out there, though. never mind yeah, he will be pretty happy being six under par. this is bruce koepka chipping in off of the green he went six under as well. phil mickelson, he is one shot off the leaders. he is a three-time winner around augusta. definitely knows his way around and lefty was showing that he knows exactly what he is doing after that opening day's play. tiger woods, he is on two under par. a couple of the other favorites. rory mcelroy not going

particularly well. one over par, and as well you've got ricky fouler, very much in contention a whole host of names including another former winner, adam scott as well. he is on three under par z >> we've got ten seconds the chinese gp this weekend. what do we expect? >> fastest in second practice from sebastian vettel. a quick look at futures before we end the show, and the week here you go. we are expecting a big bounceback for the dow to the tune of 115 points last time i checked. there you go 161. that's it for today's show i'm carolyn roth worldwide exchange is up next. see you very soon. have a great weekend, everyone so... you're driven, and you have a ton of goals... but you're stuck in the vicious cycle of credit card payments. it's time to get a personal loan from sofi. borrow up to $100k to pay off your credit cards,

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skbro leerz your top five at 5:00 it is time uber announcing big plans to go public it could be the biggest technology ipo in american history. we're going to break down the three things that you need to be focused on straight ahead. disney finally pulling back the wraps on its new streaming service, but it's what business ceo bob eiger said about traditional tv that is getting all of wall street's attention today. you're going to hear from eiger ahead. earnings season kicking off in a couple of hours. what you can expect from some of the biggest banks like jp morgan and wells fargo when they roll on the their numbers let's call i