you've seen the price come down a bit, hovering over $60, now at $58.37 and we want to wish joe kernen, good time on his european adventure. make sure you join us. >> in europe for july 4th. >> join us tomorrow, "squawk on the street" begins right now ♪ go on take the money and run ♪ ♪ go on take the money and run ♪ ♪ go on take the money and run ♪ >> good morning and welcome to "squawk on the street. i'm david faber along with jim cramer we are live from the new york stock exchange carl quintanilla has the day off. let's give you a look at futures, started with trading one half hour from now, of course we are set up for a slightly lower open europe kind of mixed, asia, yeah, yin and yang thing. >> yeah. >> give and take. >> yeah. >> from yesterday. >> right like how mnuchin took from your

10:00. >> yes, our 10:00 get, peter navarro, looking forward to that as well. first hour, let's get to our road map renewed trade uncertainties, of course, that's what we're talking about just now, weighing on stocks. the s&p is poised to pull back from that record as the trump administration now threatens new tariffs on the eu. and as jim just said, white house trade adviser peter navarro will join us, first on cnbc interview. >> news, news, news, news. >> it should be. always enjoy having mr. navarro. plus, cook, absurd and don't match with reality apple ceo tim cook blasting reports of tensions with jony ive. we have in nike backlash, the company cancels plans for some sneakers a big issue, but some sneakers they were going to put out with an early version of the american flag you know their customer base

>> my father, his workshop, we went there 50 times, across the street, and i just -- i know the country's a changed country, but that is kind of a proud art of the philadelphia tradition but hey, you know, there is a lot of people, a lot of countries made some mistakes founding fathers made mistakes everybody makes mistakes i understand exactly why they feel that way. i would understand someone from my family would be like, betsy ross a hero. and it is tough. it is not about betsy ross, it is about the notion of slavery >> since we started talking about it, let's tell people the news here, nike did confirm, it is pulling this fourth of july themed air max one sneaker features an early american flag as we said, 13 stars and circle. this after nike endorser, former

nfl star, colin kaepernick, is said to have told the company it shouldn't sell a shoe with the so-called betsy ross flag because he and others feel the flag is offensive, symbolizes an era of slavery that prompted a response by the way from the governor of arizona doug ducey when tweeted this nike made it decision and we're making ours, i ordered the arizona commerce authority to withdrawal all financial incentive dollars under their discretion that the state was providing the company to relocate here. potential benefits coming their way for locating something there. i'm not sure what exactly it was. >> do you think that stock x is the winner here? incredible dan gilbert-backed exchange where you trade nike -- >> i don't know. i don't know these -- they know their customer base. >> i know. >> they respond in some way to it whichever way you feel about -- >> my view is irrelevant. >> hard for us to necessarily

understand, frankly, the offense taken. >> the world's changed, much more thoughtful now. >> yeah. there say look at those. let's move on. nike, of course, no stranger as well to our conversation when it comes to trade given the importance of -- it does make a lot of its sneakers in vietnam, right? >> yes vietnam, by the way, is a story. this is the big story. >> yes >> we have driven or trying to drive as much trade as potential to vietnam, just because we want to exit. vietnam and china, terrible relationship chinese manufacturers historically have become -- have almost always been at odds with the vietnamese government. vietnam, those of us who are old enough remember the mining, so history is really crazy. >> something i did learn from carl's great reporting there is it is not something that going

to happen overnight. not going to be able to move your full supply chain they can only handle so much they only have so many qualified people who can actually do the work the infrastructure is nowhere near what they have in china there are so many reasons why vietnam will continue to see an increase, at least and, again, i'm having to listen to carl's reporting, that they're going to be able to really in a significant way take this on. >> you live this incredible interview with peter navarro, important thing to ask him is did they pause on the tariffs because there is simply no way american businesses can continue to pull out as fast as they would like >> right. >> because there is no -- you got tremendous workforces in these countries. but china, an amazing country in terms of commerce and it is the infrastructure supply chains are extraordinary. gary friedman said he would never -- he was committed to china in february. >> restoration hardware ceo, correct? >> yes.

>> sometimes we need to alert people. >> i'm too frazzled. there is without a doubt, david, an inability for anyone to turn the switch >> and i think that it is really important for peter navarro to address the notion that as much as you want to move to mexico or move to vietnam, how dated am i -- >> you talk about switch, we'll talk to navarro about huawei as well as i pointed out yesterday, we discussed, it is also kind of a confusing number of issues if you are a supplier to huawei, what you can and can't do. what i'm hearing at this point is nobody is seeing it as a green light in any way >> i think it is a big one for -- big one for -- if you go after huawei's hand set business and national security business, i think it was very easy for xi to say, listen, we're willing to sacrifice the 2 million people who work for apple, and we're

done with them that's not going to happen, which is why even though jim suba puts out an excellent note today, wow, it just doesn't seem to matter. it just doesn't seem to -- by the way, delta has just had some very good things automatic data down. that's because of a slug i'm looking at the actual stuff, rather than just focused on the anecdotal. >> understood, looking at the actual news involving actual companies. >> we have the exact same suit on. >> no, we don't. >> it is exact same suit. >> no, it's not. >> men's wearhouse, no. >> don't take a shot at men's wearhouse. >> it is gorgeous. mine is from -- >> ginsburg, don't you know a -- >> mine's cashmere, worth more than you. >> yes, it is. yes, it is your suit is worth more than my net worth. >> so much stock news. >> let's get to it

let's talk about -- let's talk broadly about the s&p. yesterday, of course, you saw we hit a record high. truce between china and the u.s. we are now threatening tariffs on what $4 billion of additional european goods >> not cars. >> long running dispute. and olives, olives, jim, italian cheese and scotch whiskey. my dear friend here owns a lot of olive trees >> 400 olive trees i'm not allowed to profit from that or from the wine that i grow because yet it has to stay in the country. cramer's done better >> you're not worried. you can only sell your olives intri internally in italy. >> get an exception. an exemption for my -- >> twenbetween the mexican restaurant --

>> killing it. the brooklyn nets right next to them. >> it is all working your way. >> i'm glad we're focusing on -- >> tariffs on mexico, that got short-term resolved. how about the stock market >> i think the stock market is vulnerable but it has to be careful we divide the stock market into the cloud kings, the software, the very red hot ipos, which people are starting to say, listen, they're too fast and furious, versus the transports which are down and out, the financials down and out, rescued by sicar and united health is better than looking at biden's poll. you can tell how biden's doing by looking at united health. it is doing poorly >> there is a concern that some of the candidates in the democratic primary who support universal health care are moving up in popularity. >> only biden supports universal health insurance >> is that -- >> every other one --

>> buttigieg also put his hand up. >> every other one is -- >> no. not -- not hickenlooper. >> well, okay. >> how about bennett not bennett. >> major ones. >> bennett is not getting any traction i love that guy. >> your buddy in colorado, hickenlooper -- >> which buddy of mine >> john malone. >> i'll ask john that's how i met bennett originally, actually >> all right, well, anyway -- >> at dinner >> just to go back to the market, this is historically a bountiful time, david. >> it is >> july 4th. can you imagine peter navarro comes on and says we're about to receive, our country, is about to receive one of the biggest buys ever in the next five days from china. >> okay. sounds like you may know something. >> that's going to shock the bears. it is going to send them running. >> okay. >> what was that call? was that news? yes, yes, possibly that's going --

>> i don't know if it will move stocks i think we'll do a faber report. that's news to my producer who is hopefully listening now during the break, we'll be busy. still to come -- >> boeing downgraded from jeffries nordstrom, that's the evidence lab, that csi, u.p.s. >> other stocks. >> westlake. >> don't waste the entire list we have 49 minutes of show left. we are also going it talk a bit more about tim cook. he did blast that report, on the wall street journal, about the reasons why apple's chief designer jony ive is leaving the company. white house trade adviser peter navarro, heard jim talking about it, u.s./china trade negotiations and tariffs and maybe the chinese are going to buy something else in bulk. >> take another look at utures we got about 19 minutes before we get started with trading here at the new york stock exchange we got a lot more "squawk on the

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most of us don't know how much data we use, but we all know we're paying too much for it. enter xfinity mobile. america's best lte with the most wifi hotspots, combined for the first time. when you're near an xfinity hotspot, you're connected to wifi, saving on data. when you're not, you pay for data by the gig. use a little, pay a little. use a lot, just switch to unlimited. get $400 back when you buy the new lg g8. call, visit or click today. tim cook is blasting a wall street journal report, this was yesterday, about the departure of apple's design chief. it says jony ive had grown frustrated with cook's leadership and alleged lack of interest in the design production process in a statement to nbc news, cook says, quote, the story is absurd, a lot of the reporting

and certainly the conclusions just don't match with reality. >> wow. >> at a base level, it shows a lack of understanding about how the design team works and how apple works. it distorts relationships, decisions and events to the point we just don't recognize the company it claims to describe never good when you're the reporter behind something like that i think we did have him on yesterday, though, on cnbc i don't know >> if you're tim cook, excuse me, if you're tim cook, why would you blast like this if there weren't some degree of truth to what tim cook is talking about? >> it was a decidedly -- i wouldn't say was overly negative, but had a negative edge to it did feel that design has fallen in terms of its importance, that as was said and cook denied, of course, his focus is not necessarily on that. and then mr. ive himself had been more disconnected from the overall process over time. >> i don't know.

>> caring for an ailing parent -- >> why the innovations i walk around italy, i walk around wall street, walk around midtown, and everybody has white things falling from your ear if they were so ugly or weren't designed -- oh, no, he designed them too give me a break. there is a team. >> right. >> and there is -- it is a group of people. and everybody knows this group of people. the article acted like there wasn't a group of people michelangelo and then just people that -- the pretenders. >> meanwhile, apple itself. >> the winner in trade talks >> yes the winner in trade talks, you feel as though if things had continued to worsen, apple is in a precarious position. >> yes, because if you're not going to sell if you're going to block hand sets of huawei, why should -- >> hand sets, first of all, all right, blocking hand sets by not allowing the components from u.s. suppliers to be sold into them, therefore huawei would be

almost out of business within six months to a year depending how much they had on -- >> yeah. the chinese played the long game what is the long game other than to say, okay, listen, you go huawei, we'll go april that's why it is a big win for apple. i don't care about -- >> what do you think the chinese response would have been on apple? >> i think very easy to say, listen, we're on that -- you're on that list, the suspect list which apple shouldn't be, 2 million people work for apple. >> you think it could have gotten to that by the way, not as though it still can. >> i think this is apple is in the clear. and tariffs aren't coming. it is good for apple our tariffs. i believe that the huawei is a quid pro quo and, you know what, david, apple may miss the quarter, but we're five quarters from 5g. >> apple may miss the quarter. you just buried the lead there. >> i'm reading the note from citi he's a nice guy. >> why are they -- you don't think they will? >> no i think they will. i think there is the estimates

are too high for hand set numbers and too low for service and too low for watch and -- i'm working on a present value of a sub. of which by the way i'm getting very little help from apple to come up with, a lifetime value of a sub, worth more than any other sub in the world and yet -- >> recurring revenue from all the services. >> right apple, if they do it, they got such good finance people, it they do it, you're going to start valuing this company with a procter & gamble multiple. that means i'm talking 250, 280. but you need one analyst to break, you need one firm to cover -- >> even revenue service revenue growth slowed. >> oh. >> it did. >> katie uber ty has a good analysis of how that's not necessarily -- a little law of numbers there. >> i always see the law of numbers. >> the fortune 300 company on

accesso accessories. >> all true. but to the extent that people are -- you want them to focus on valuing it on that recurring revenue stream, and therefore the higher multiple, a la p&g. >> the dollar shave club harry's? >> it slowed a bit >> well, you wear me out >> i'm just pointing it out. i'm not here to take sides. >> i'm accepting the suba note from citi saying it is entirely possible -- >> they missed the quarter stock goes down? the beginning of this year, where the stock got hit, here we are up 28%. >> it goes down 23, 25 points. and then people say, buy it for 5g big cycle coming up next year. >> i like that that's everything you need to know that's good. >> you're the best >> there's the music get ready, you got a mad dash coming up. don't break your arm patting

yourself on the back there we got another countdown to the opening bell as well 10 minutes away from the open here one more look at futures one more yeah, we're going to be down at the open not much more "squawk on the street" back right after this

♪ if you gave me a chance i would take it ♪ ♪ it's a shot in the dark but i'll make it ♪ all right, welcome back to "squawk on the street. i'm for a mad dash want to talk a little roku always enjoy -- unexpected success story. >> yes. >> i guess you have to say

>> look at that. >> no offense to anthony wood and the management team there. if you look at what their product offering was, you might not have anticipated that it would be this -- >> anthony is very understated so, i mean, came on "mad money," i was saying, isn't this the way to play the cord cutting very methodical. very methodical. but this now, why is this so important? >> hit the thing yeah >> why is this so important? okay quick draw mcgraw. because mark ma haney, one of my favorite analysts from rbc says enough, enough is enough buy the home valuation. too much too much enough by the way, does the same thing with another one of my favorites, trade desk. this is the key to this market, roku because you can imagine all of this software, the service, they're all like this. they're all, like, up, up, up

and away whether it be kupa, which i like, workday, they're all insane and so that is -- if there is going to be an area of vulnerability -- >> what is the multiple on this stock at this point? i can't say i know -- >> we don't have multiples >> concern >> they're not really multiple stocks they're concepts >> they're doing great but, david if you pin me down to something like a multiple when it comes to roku, you're not in sync with this market. >> i'm not >> there are stocks selling at -- beyond meat, david, selling at -- someone today -- >> selling beyond a multiple. >> did you see the beyond meat note from credit suisse. they boosted the sales number for meat sales, but they kept their price target of $125 is there any way we can put up the beyond meat chart? beyond meat, david, is doing incredibly well. so is impossible burger.

look at this is this really -- is this, david, is this a blue chip stock, i ask you >> the answer is no. >> witness to the prosecution. >> the answer is no. we have an oli ian opening bell minutes away update on where things stand with sprint and t-mobile, the doj, dish, the germans, what a party they're having in d.c. >> holy cow.

you're watching cnbc's "squawk on the street. we're live from the financial capital of the world the opening bell will ring two minutes from now typically, jim, i turn to you and ask the key to this market, you already told me during the mad dash said it was roku we moved on from that. >> there is a sense of -- >> it was roku let's move to some other areas we don't always touch on, not equity related we got the ten year. i know it is okay >> 10s and 2s. >> right about 2%. after a bit of -- not a rally, yield going higher and then -- and oil. as well, benefited, supply at

opec, here we are. >> the oil companies decided almost en masse in america they're going to go for discipline not going to overspend and raise money and equity market or bond market. so what do they do they sell futures at 60. over and over and over the curve is not moving out five years it very hard to go higher. i'm not saying i'm completely in control of the oil market. i'm saying we are -- we put a ceiling on it. our own producers. >> we're exporting almost as much -- that's -- >> 2020, when the pipelines are done our ability to export from the permian will be greatly enhanced, correct in. >> we'll export as much as we input. remember, we import crude and export largely natural gas so don't want to conflate. >> we are just filthy with natural gas. got it everywhere. >> natural gas was zero. zero and that means they flare more

than they use. if we go to outer space, you and i, we'll see the flaring even if the epa doesn't. >> right there is the opening bell for this tuesday muted open this morning. perhaps down a bit real time exchange here at the big board, innovator etf, two recent product launches at the nasdaq, inc. magazine and the luggage maker away >> yeah. another one that is ready, i guess, in the chute. the chute can't handle much more right now. i'm talking about the ipo chute. back away a little bit let things recharge. but they never do, do they they just keep flooding. >> they keep coming. it is going to be an interesting potential second half in ipos. i don't know whether we're going to see wework, one of the largest -- >> the we company.

or airbnb, it seems i haven't heard lately that is the case. palin tear was another one around for a little bit. leslie picker, our reporter, covers that closely. better information but the question is what is the second half going to be as strong for initial public offerings as the first >> it depends upon the size. and the price. we have seen you put out a lot of stock, lyft, uber, not so good you put out a little bit, there is some great notes about revolve today. many buys. e-commerce company, i really like realreal last week, don't put out that much stock. if you did a sliver deal, and let the rest wait six months, they work. so let's hope that had they do these giant deals the people behind them do sliver deals in order to keep the market going of course it does hurt six months >> how is -- the slack ipo was -- the direct listing was

very interesting. >> yeah. that's a great company a lot of the companies are great companies. these are not hedge.com, even as the ceo of realreal is doing -- >> right >> david, could you please tell me what you've been hiding >> we're going to wait we're going to do a faber report and update we will do that. >> big slug of automatic data came. >> tell me. >> this is the deal to watch automatic data, initially it was down big on the slug, which is ridiculous, 80 p having terrific time 161 is the offer 8 million shares jeffrey's deal, just go by the stock now at 160. >> is it a secondary or is it a primary -- >> an offering by them >> by the company? or by -- >> it has been very secretive, which is -- they're not handling this right jeffries and credit suisse will tell me, jim, you don't know anything about deals, ridiculous, i used to sell them.

go buy it, the company is having an unbelievable year i think it is a mistake to run away interest a deal like this you run toward it. same way i felt that the harris combination was a little ridiculous, that was down ten points >> we had the ceos and they will change rules, actually, i can say the ceos of l3harris on with us yesterday and the closing of their transaction to create one of the larger defense companies and one they want everyone to believe is focused on being a technology leader and then the stock got hit very hard as the session wore on. >> reallocation there, but that is going to be a fantastic play for people who want the technology, the uber technology part of defense and l3 up five that was sued by, it was down 10 this market can be so stupid stupid, stupid, stupid >> speaking of deals and -- you

were away last week when the allergan transaction was announced. >> congratulations to brent saunders. >> yes what about mr. gonzalez? his -- on the other side there, that did not do particularly well >> congratulations to brent saunders >> any thoughts in terms of that deal and what is going to happen >> this is like celgene. revlimid and bristol-myers, bristol-myers is at 46 people feel patent cliff for botox, competitors to botox, botox is an amazing franchise, but people feel, you know, look, when it rolls off, what has brent got besides very good migraine franchise that has not yet been -- not been approved. so congratulations to brent saunders. >> abbvie did come back a bit, jim. >> they have been able to demonstrate why -- >> it is not anywhere near the price it was at the announcement of the deal.

>> abbvie, greatest patent clip on earth. >> with the largest drug, $19 billion. >> greatest drug ever. how about scott gottlieb joining the board of pfizer. >> he was a guest this morning on "squawk box". >> this is like you and me having a conversation. are we allowed to do that? aren't we supposed to be reading stuff? >> we don't read on this show. we just talk and hopefully they -- our audience stays with us. >> soggy opening once again, the managed care stocks reflecting elizabeth warren and kamala harris. this is about -- listen, honestly, there are all these polls people take, i got called last night by one of them. someone was polling me i hung up on them. sorry, that was rude but i don't need -- you don't need to poll just look at the unh >> that's all you need that's the tell on the success of the -- >> it is about health care insurance versus universal health all ten apparently do like

universal health so i am focused on your navarro interview. i'm focused on boeing. which we haven't talked about. jeffries seems to have thrown in the towel. removing boeing as a franchise pick, too much uncertainty, nobody picked up on our harris view yesterday where they said there will be a demand to train pilots on the max, which will, i believe, hold up, but we'll know from -- we'll know from phil, hold up, let's just say, when that comes back into circulation. in the meantime, facebook, no negative news, continues to go higher. >> let's talk about another aerospace theme, united technologies i was out on friday, so were you, dan lobe's third point came out with a fairly strongly worded letter in opposition to the raytheon deal, adding their voice to that of bill ackman who came out as well third point i make a more serious to be taken more seriously here, having been a f fairly long term hold, a big supporter of honeywell and the moves that they made --

>> far exceeded what lobe wanted >> do you -- do you think the united technologies deal has -- is in any way threatened by opposition it does require a shareholder -- >> it does as opposed to the an abbvie dea. >> i don't think this will be in trouble for the same reason why it was such a coup for harris to merge with l3. that's because you merge rate -- you try to get leverage over the defense department i do believe, i do believe a lot of the good -- rockwell collins, remember the old good rich -- landing gear united technologies is all those. what it really lacks to me is a something away from commercial aircraft that is in defense. and raytheon does that raytheon is underperformed for three straight quarters because they're having trouble making

missiles >> right >> that goes away. also by the way, the classified for raytheon is much lower margins than classified for harris l3. remember, we don't know what that black box is, but it is hurting raytheon greg hayes, ceo of united technologies, doesn't care about that.prevails. i think if there is no tariffs or if they held off, oates will have good quarter. oates had good number in china i think -- dan lobe has a good -- >> yeah. >> i think that greg, you bank with hayes on this you bank with hayes. this is my own work. >> this is a story we'll be revisiting a number of times let's get to a story this morning, shares of delta up 2% to phil lebeau with news involving that airline phil >> david, delta out with 2q guidance, revised guidance, essentially saying the guidance we put out in april in terms of earning between 205 and 235 a

share, we're going to be at the high end of that now they're saying they're go heihe i going to raise the bottom end by 20 cents in terms of revenue, guided 6% to 8% higher, now saying 8% to 8.5% higher and total revenue per available seat mile, the metric in the airline industry, up 3.5%. nr now they're saying, no, up 3.5, if it gets above 61, that would be an all time high for shares of delta we're going to be talking with ed bastian when the earnings come out next week down in atlanta talking to him this is a stock to be watching today. >> okay. so glad you brought this up. it is still only ten times earnings, a remarkable company the way that -- the revolution there, in terms of the balance sheet, the buyback, the dividend what confounds me is when people say that you're on a plane,

extremely filled, that play is making money that company is making money delta is making money. i'm so glad you have -- you pointed out that it is just a couple of points from the high because, oh, my, this has been a winner and congratulations to bastian he's been a super guy, comes on, you interviewed him, your interviews are amazing what a stock people aren't talking about it what a stock >> jim, there has been this hand wringing about the airline stocks for the last three months when you talk with oscar munoz, at united, talk with ed bastian, most of the ceos, american has issues that are separate specific to american and those concerns have sort of spilled over to the rest of the group. and hwhen you talk with everyboy else in the industry, you are not seeing a slowdown in traffic, not seeing pricing under great pressure the way people fear it is and internationally, the markets are doing fine there is no slowdown there is a little softness with china. nothing falling off a cliff. so that's why i think a lot of people for over -- over the last

couple of months, there was this hand wringing and that's going away >> that's great. southwest. fabulous reporting thank you. >> thanks, phil. let's get to seema mody now, on the floor for us, more on what's moving this morning. >> stocks pulling back after hitting a record high yesterday, a limited reaction overseas to the u.s. possibly moving forward with new tariffs over eu aircraft subsidies but we did see futures drift lower right around 3:00 a.m. when that announcement came out. still, one big story that is getting a lot of attention today, aside from stocks pulling back, you're seeing gold rebound, gold gaining about 7% in the month of june it was lower yesterday by 2% coming back today up about .4 of 1% let's pivot to ipos. ab inbev, $10 billion in a hong kong listing for its asia business expected to price in new york on july 11th, list in hong kong a couple of days after that. also set to be the biggest ipo so far this year, larger than

uber's $8.1 billion deal on that note, just worth noting, the performance of some of the recent ipos they all sold off yesterday, uber down 5% realreal was down 9% yesterday mixed reaction in early trade on tuesday. earnings revision still a big story, that's pulled down. so far earnings estimates are now flat for the second quarter for the s&p 500. and for the technology sector, we're expecting profits to decline by 8% in the second quarter. so certainly some concerns as we await the second earnings -- the earnings season for the second quarter to kick off in about two weeks' time. on that note, big question is whether these results will create a rotation out of growth and into value what you're seeing here is a look at the year to date performance of growth related stocks versus value related stocks, growth is marginally outperforming value. and a look at early movers today, you'll see that defensive

names, consumer staples, mcdonald's, verizon, coca-cola, leading goldman sacks by around half a percent back to you. >> thank you, seema. time for our faber report, let's get to it, wanted to update people on the continued talks that are going on. in fact, moment by moment, between t-mobile, its parent company, of course, remember the german telecom company, deutsche tel telecom controls t-mobile. dish, the large direct broadcast satellite company that owns an enormous amount of spectrum that conceivably will be a real player in the wireless market in this country and, of course, not to be forgotten, the department of justice and its antitrust division, which is trying to figure out a way that there is going to be a divestiture of enough from t-mobile to dish to really create a fourth competitor in the wireless

market in this country so where are we? well, i mean, they were talking 11:00 last night >> by dish right now go buy dish right now. >> the keys here, jim, t-mobile and dish have largely agreed to a divestiture deal that's not really as much the issue according to people familiar with the situation at this point as it is the doj's continued concern that it is not quite enough and that they want more out of t-mobile in terms of making sure that dish is in a position to start competing pretty quickly now, charlie ergan's dish owns lot of spectrum. it has certain metrics had has to hit but it also wants to get up and running fairly quickly, which it conceivably could do so given a capacity agreement that it would also be a part of this deal with t-mobile i'm told that there are a few issues that the doj is focused

on one of them is pushback from t-mobile saying we only want dish to have access to or the ability to use what would amount to 12.5%, i'm told, is the number of our total capacity not even sure how they -- they're saying that's what we want, that's what we feel good about. doj pushing back and wants it to be unlimited >> the doj, david, that is the government >> the doj has a pretty good position because if they don't get that they want, they will sue to block the deal and the deal is dead already got states that are suing to block this deal however, the doj, you get an agreement, adoes seem, again, i've been reporting this, dish has the money. dish also will be in a position, jim if they get this deal, to raise plenty of money, it would seem another area of contention i'm told is that deutsche telek telekom/t-mobile is pushing back on a strategic investor at more

than 5%. they say, 5% is fine, but you can't bring in somebody, let's say google or amazon, you name it, who would invest 10 o% or more there are issues there is the ability to resolve the issues, it would seem. there does seem to be on the part of the parties involved and the people that i'm speaking with who are familiar with these negotiations, telling me they do believe they're making progress. they are exchanging drafts as you might expect and conceivably by as early as next week, they will actually have a deal underwhich -- >> do you know how you've done if you bought these -- also, all the oligopolies, ball or lindy this is the giveaway that i've not seen since constellation brands. >> what the doj i think would say is if you don't approve this deal, first of all, what happens

to sprint? what is sprint >> they need that because of 5g. >> what do they do do you sell sprint spectrum? who does that go to? possibly sell it to verizon or sell it to t-mobile >> that maybes it -- >> the point is, do you have a fourth competitor if that deal dies, one question the other is if they can agree to terms here that the deutsch telecom and t-mobile is okay with, is dish in a position to compete with 5g nationwide in a period of time >> dish needs a partner. >> they need capital, which they would be able to bring in. this is not brand-new. they don't need to migrate anybody from existing network. they had the spectrum, jim not a function of the spectrum it wouldn't be a -- >> it would be somebody -- >> so, we'll see >> david this is a huge piece of news >> i don't know. it is incremental. it is more incremental >> no.

>> we have been reporting on this for weeks as have virtually every single news organization, but at least we can give people an update. >> too self-effacing to me, you get these examples of when the justice department forces a divestiture, the buyer has done incredibly well i don't know why this would be any different. ftc, look at rite aid, oh, man, they wrecked rite aid. >> yeah. >> i'm staggered that dish is -- they come up with -- >> there has been an expectation that charlie ergen, who is a difficult man to negotiate with, personally think he's a really good guy, but would stand in the way. but this is say real opportunity. >> just fabulous for dish. >> to give itself the optionality he's been sitting on for so long, waiting and waiting and waiting. >> does it matter? >> it is good spectrum. >> yeah. >> yeah. particularly i think for 5g, there is some questions about verizon's millimeter wave spectrum in terms of propagation

capacity. >> microwaves, gremlins, they pop. >> okay. i'll remember that >> coming up, don't forget as well, he got white house trade adviser peter navarro, from u.s./china negotiations, to the new nafta. "squawk on the street" is coming right back my experience with usaa

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up next, we have stock trading with jim see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade

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trading. >> recommendations on revolve, new company on commerce, come down, it's buy i like it. >> all right you like it. so does the market right for you. >> it's right. just right e-commerce it fits the pattern. >> green growth tonight. >> "mad money." >> cannabis. >> can't way to hear what navarro has to stay. >> good questions. thanks see you back tomorrow. >> bsolutely. >> when we come back, as jim said, white house director pete navarro. keep it here

good morning welcome back to "squawk on the street." i'm sarah with david, from the stock exchange, carl quintanilla has the day off. taking a look at averages, coming off the trade, coming off record levels, closed at a record high for s&p yesterday just pulling back a tenth of a percent after post g-20 trade truce celebration. as far as what's working in the

market, real estate, utilities, a little defensive tone, energy and materials the biggest losers road plan for the hour starts with, quote, it's already begun. the president saying u.s. and china have picked up on trade talks. moments from now we'll speak with president trump's trade adviser peter navarro. another ipo brewing? it could be the world's largest offering this year. plus sneaker backlash. nike canceling plans for the release of its new shoe with an early version of the american flag now one state where nike was building a manufacturing plant is pulling financial incentives for the company. details on this rapidly developing story straight ahead. we will start with trade, though, stocks moving lower days after hitting pause in the trade war with china this as the trump administration ramps up pressure on the eu now proposing $4 billion in potential new tariffs over aircraft subsidies meantime the president saying trade talks with china have

already begun. reports during their meeting at g-20 chinese president xi jinping did ask president trump to ease north korean sanctions joining us on cnbc fresh from g-20 peter navarro welcome back, peter. nice to have you. >> great trip, and it's good to be home. >> how would you characterize the progress that you made specifically on those trade talks with xi? >> well, we're reengaged we're talking on the phone already. there will probably be visits. it's all good. i think it was a pause that was necessary at the time. but this is very bullish for the markets, lower on certainty in terms of the whole thing we're headed in a very good direction. >> except for we've been here before we saw a trade truce after the last g-20 meeting. that didn't stick. why should this time be different? >> so, this is a very complicated process.

there's seven different moving parts. we had a deal that was over 150 pages long with seven different chapters that's the basis now for moving further forward. it's complicated as the president said correctly this will take time and we want to get it right. let's get it right in the meantime in terms of the markets, i think very bullish for the markets. the two things that really have to happen in the short run to get us dow 30,000 and above passing u.s. mexico and canada agreement, having the fed lower interest rates. >> mr. navarro, there are those that say we've got talks back on track but we actually gave some things up. namely huawei for example, and got nothing in return for actually getting those talks back on track. what do you say to those critics that wonder about that negotiating leverage we potentially did not use. >> well, there's a couple of things there i think what's important about

this negotiation is the close personal chemistry between president xi and president trump. president xi requested some relief on huawei here is the important thing. u.s. policy on huawei with respect to 5g in this country has not changed. that will not happen with huawei in this country. all we've done, basically, is to allow the sale of chips to huawei these are lower tech items which do not impact national security whatsoever huawei remains on the entity list more importantly, i think, china gave us some things, too they promised immediate and significant agricultural purchases and we hope to see immediate, immediate progress on that the important thing here is huawei is small in the scheme of things the important thing here is negotiations are back on track

lighthizer is actively engaged with president trump guiding the whole process and i think the markets should be very happy about that. >> yeah. well, the market was happy yesterday certainly. but you talk about huawei being small in the scheme of things, which i guess i can understand but at the same time -- >> let me be clear here. >> you just said that. >> hang on. >> okay. >> huawei -- selling chips to huawei, a small amount of chips, less than a billion dollars worth of chips a year in the short run is small in the scheme of things. 5g -- the fight for 5g, president trump is very committed to having the u.s. take the lead on 5g, building companies like nokia and ericsson up in europe that will tribute to that process. so 5g is huge. selling a few chips to huawei is not. >> some of the companies still trying to understand where we

stand with that. we have characterized them as a national security concern. >> they are, no question. >> light shonne on huawei. not a green light for huawei but an olive branch to help the chinese think we'll help keep them in business >> i think you probably said it better than iblgd. i think the thing here, if you think about huawei, okay, there's two things going on. one is huawei is trying to dominate 5d using the usual chinese playbook, which is to dump product onbelow cost, steal the technology from their rivals and push everybody out the problem, of course, david, is that you've got software issues one patch and you can open somebody's system to huawei. you've got hardware problems, there can be trojans lurking we have to be very clear about

that we're going to work closely with our allies around the world and make sure huawei 5g is not in those countries but in the meantime, a small amount of low level chips are going to be sold to keep systems going, and that's not a bad thing when it gets us back to the bargaining table with china and with china committing to immediate and significant purchases of agriculture goods let's see if they deliver on that. >> you know, the administration also decided to hold off on the additional tariffs, that threat that was hanging over $300 billion in imports it all feels very un-peter navarro like were you on board with how this went down? >> totally on board. look, we have 25% tariffs on $250 billion worth of chinese products that's our insurance products to keep these negotiations on track. it's also our defense against chinese -- they steal our

technology, dump products into their markets. these are the structural issues we're dealing with, not just for the united states of america but for the rest of the world. what we're trying to get to is a place with china that confirms to the rules of international trade as we know them, not as they know them, because the rules this they follow are ones -- it's more of a zero-sum game we want to move beyond that. look, from an investors point of view, here is all you have to know talks are back on track with the work that has been done to date. 150-page plus document that serves as a way to move forward from there there's a lot of good work that has been done. you've got the best u.s. trade representative we've ever had in the u.s. in bob lighthizer and he's working closely with president trump who is actively engaged in all of this

we have a plan as the president said, he wants to get this right. these things take time this deal, by the way, is far more complex than anything we've ever negotiated including u.s.-mexico-canada agreement, which is the most sophisticated and smartest deal ever written we've got a lot of good work to do but we're doing it. the markets should be happy about it, investors should be happy about it. >> one thing investors aren't too happy with is growth is slowing. there's some real evidence tariffs are having an impact at least on the manufacturing you have to admit that, peter. we've seen a softness in the numbers and new order and regional fed manufacturing surveys. is there some recognition within the white house that you need to speed up on the deal to prevent the economy from losing more steam. >> so i don't have to admit that at all all i have to do is point to the federal reserve hiking interest rates unnecessarily too fast, too far, and engaging in massive

quantitative tightening at a time when they should have been holding pat. that -- what we're feeling now is the residual effect of that mistake that was done months ago. the hope is that the fed will do the right thing here and lower interest rates and get us back on track the tariffs, in my judgment, are working beautifully. if you look at q11 2019, only one pointafter attributable to the reduction in trade deficit primarily with tariffs on china. china is paying the tariffs. china is paying tariffs in the form of lower exports, lower prices and lower profits the chinese government pays the tariffs, in terms of a lower growth rate there and higher unemployment. >> peter, are we really going to have this argument again about who pays >> we are going to -- >> we have the ceos that come on our air, peter, all the time who

say i don't know how i'm going to pass it along, certainly if it went to 25. i don't know i'm going to swallow some of the margin. >> hang on if you're a ceo. >> yeah, i'll listen. >> you're going to come on and say whatever it is that's going to advance your multinational model to offshore products to china. that's what you do the day you start believing what chief executive officers say is the day that you've fallen into the deep swamp, buddy, and i'll send you a snorkel. >> i've been doing this a long time. >> so have i. >> sometimes i believe them and sometimes i don't. >> don't believe them on this point, because the problem is, look, here is the difference this is not a tariff on the rest of the world this is a tariff on china. what we're seeing is all this production either here or vietnam, malaysia, thailand. china did, by the way, devalue its currency 10% to offset 10% tariffs on $200 billion.

we're seeing zero inflation. point me to this inflation, david, that's supposed to exist from the tariffs you cannot find it. >> a lot of the consumer companies spared so far. go through with that next $300 billion and you should see it, right, peter >> that's another discussion in another segment. but for now, thank you for admitting the first $250 billion had zero effect on inflation and china paid the tariffs you made my argument. >> that's not -- >> she just said it. >> no, no, no. what i said was -- >> zero inflation. somebody has to be paying for it it's not us, not american consumers. >> that's because you guys have spared apparel and footwear and some of the equipment that consumers do pay for. >> iphones. >> like i said, let's have that conversation if and when the president decides to raise the tariffs on the last -- what we call the fourth tranche of

chinese price. what we're fighting for, you and i, we agree that china needs to basically clean up its act big time, and they have had 15 years over the course of obama and clinton. my guy is the guy who is standing up for the american people we all agree on that. >> i certainly hear from a lot of business leaders supportive of the efforts you're making here i guess i'd like to get to that, back to sort of the issue at hand. >> sure. >> secretary mnuchin has talked about, well, we're 90% of the way there. that 10%, do we still want the chinese to commit to legislation that enshrines some of these things we want them to do on intellectual property, on technology transfers because they seem to be pretty dead set against doing that. >> so i'm not going to infringe upon robert lighthizer's territory as a trade rep i'm going to let him do the negotiations behind closed doors. when the time comes, the big

reveal will happen, and i'll be here to talk about what exactly happened before then, let's let the negotiations go. i think that's what the important thing is let's have the negotiations done soberly, quietly, bi lly behindd doors and all will be transparent when the time comes. we need to get to a deal it will either be a great deal or it won't. that's president trump's words and he's our leader on this. look, the other thing we should agree on, before president trump took office, we spent over a decade where nobody even bothered to challengethe chinese on their trade practices and now we have them at the table, at the table. that's good. >> i guess the concern is to the extent we've got them there that we can follow through and get meaningful changes. >> well, we're working towards it you guys always want more. that's the problem, david. >> you know, that's what life is about. come on. >> we're working on it more. >> we only get one shot at it. you've got to have more. >> we're working on it

look, coming back from the g-20 and dmz, who could have imagined the kind of progress that was made i mean, look, i was in a lot of those bilateral meetings at the g-20 and every single one i saw the president with his unique brand of personal warm diplomacy having good relations with leaders across the political spectrum, advancing american economic and national security interests. to be able to call saudi arabia any time the price of oil spikes and say, hey, help us out, pump some more oil, that's a good thing. those are the kinds of things. to be able to call the turkish president and prevent him from killing tens of thousands of kurds in syria, that's a good thing. this is what this president does i would say, in my judgment, this is the best foreign policy president since reagan by a long shot particularly the walk seen around the world, the handshake seen around the world across the

dmz. that man was bold. he walked over there without an entourage of security guards right into north korea who would have the chutzpah to do that, david. >> i'd like to talk about what you've written backs about, david. >> was north korea at all part of the u.s. china trade talks? >> no. i think what's important about the north korea issue is that if president trump weren't in office, we'd likely to see the soil north korea rocking with nuclear tests. we'd likely see missiles going over japan and korea, getting ever closer to the united states of america instead we have an era of calm on the korean peninsula, which again from an investor's point of view, world markets point of view, that's very bullish. so kudos to the president for

pulling off foreign policy like that one of the things i do at the white house -- >> either not a done deal. >> of course not of course not. >> it's not a done deal in any way, shape, or form. >> let me say this one of the things i do at the white house is weave together this whole idea that economic security is national security so that when we sell a thaad system to the saudis, that helps stabilize the middle east but also creates tens of thousands of jobs across over 40 states in the united states. so this whole negotiation with north korea is, again, stabilizing and allows the world economy to grow. >> i get it. i get it. >> not under the cloud of nuclear holocaust. >> i can't help but thing back to huawei and trade. >> small amount of chips. >> but 5g, which you raised earlier. you can say what you want about it but many people think we're not in the league, regardless chinese is investing more, huawei is the leader there and conceivably around the world

will be and we're behind you even mention mentioned eric knock i don't. >> with 5g, that's the poster child for working with europe, working with asia, japan, south korea in getting to be first in 5g as a world with europe and our allies in asia so nokia and ericsson are part of that. the important thing is to dominate that space and we're working on it. >> yes. >> remember, the whole china game plan, the china 2025 is to dominate not just 5g but artificial intelligence, blockchain technology, and we can't let that happen. president trump is a visionary on this, and he's put his foot down, and we're going to make

sure the u.s. is the innovation leader more importantly, after we innovate, we keep our technology and our ip. >> how badly do you need to make this deal before the election? >> look, the president doesn't do things with the idea towards the election that's one of the things i admire about him he does the right thing for the american people. so we're going to get a deal that's a great deal for america. we're not going to sacrifice anything in order to get a cheap political trick. i love this guy for that i see this every day, if i'm with him it's just a great thing. he truly cares about the american people, men and women, particularly those who work with their hands in our factories and on our farms and he's going to do the right thing here. >> what about the new tariffs you guys are putting out there threatening for europe on the boeing aircraft wto decision can europe expect a harder line?

should europe expect a harder line from the u.s. as it relates to tariffs, possibly the auto import tariffs and other more aggressive measures. >> just for your viewers, this is a hard shift, okay. we're going over to a completely different topic. so just as a little bit of background, there was a case at the wto against europe for heavily subsidizing airbus and working within the wto, we were able to get a favorable judgment on that. as we speak, the united states trade representatives office is working on what our relief might be, which would be in the form of tariffs so again, let's let that play out. i think ambassador lighthizer will have some announcement on that in the coming weeks but you know, look, boeing is a very important part of the dow, by the way it's being harmed materially by heavy subsidies to airbus.

we stood up for boeing on that and we'll see what happens the idea -- what we're seeking is to get fair and reciprocal trade without heavy subsidies from foreign governments to take our jobs, and that's the mission here as well can't disagree with that. >> no. >> we need to do that. >> it strikes me that you said that the market could get -- the dow could get to 30,000 if the fed lowers interest rates and the u.s. can pass the u.s. mca so you don't think the market is hanging on this china trade deal >> i think the market should be taking comfort now from the fact that we're moving from the china trade deal but in the short run, the best thing to do to get the market up is to cut interest rates and pass the u.s. mca, which should be passed this summer. i have a little bit of credibility, the day after the election, i don't know if you

remember this, but i was on cnbc on "squawk" and the futures were like dead, futures were in the red i described how we would get up on cheaper energy, level playing field on trade besides the president, i think i was the only one in the world who predicted that i just got lucky on that, i guess, or president trump is a great president on the economy you take your choice there >> yeah, well i know how you feel about it for sure. >> even with the fed tightening. you got there with the fed tightening. >> he through us jay powell threw us i don't know if it's a curveball or fastball at the head but that cost us a half to one full point of growth, but we can get that back if the fed does the right thick. the u.s.-mexico-canada agreement is ready to go we just need to get a final

negotiation with the democrats on capitol hill on enforcement issues let's get that passed. if it gets to the floor, it will pass overwhelmingly with bipartisan vote. it will get us initial -- more than a gdp growth point, half a million jobs, 75,000 jobs in the auto sector. i mean, it is a beautiful thing when it comes to economic stimulus and bringing jobs home with things like rules of origin in it. so let's get that done there's no reason why we shouldn't get that done other than petty politics. i think capitol hill is going to do the right thing on this i don't say that very often. i think on this one, because of the stakes involved, across every single state in the union, i think they are going to do the right thing and they will do it this summer. we'll get the dow at 30,000. i'll sit in this chair when that happens and we'll party like

it's 2020. >> there you go. >> keep us posted on the progress, peter. thank you for joining us. >> my pleasure. >> peter navarro of the white house, sticking to his guns that the tariffs are not hurting the economy, not hurting growth, not hurting the u.s. consumer. haven't really been factored into inflation yet i'll give him that but again, we haven't seen him go through on consumer products and the move up to 25% yet. >> no. and we may not let's let the talks play out over time. not going to give necessarily an update. >> they are not capitulating on huawei. >> other than telling us they have begun -- certainly making things a bit clearer in terms of the administration's point of view on what their move was on huawei, though i think there was some uncertainty but yes. not really answering that key question as to how far are you willing -- how far are you going to push the chinese, because

remember they backed off when it appeared others reporting about having to enshrine some of the stuff in terms of with legislation, the feeling that it would be much more significant and they would actually adhere to it if they did that, the chinese, in terms of intellectual property, respect, and forced transfers and things like that. >> the president is not timing this around the election, which i think if you ask a lot of investors on wall street and a lot of people we talk to, they say he needs a deal before the election and needs to get the economy from not falling apart i think it's hard to find, david, people other than people in this administration that will tell you that tariffs do not hurt growth. >> i agree order is being restored, this afternoon protests in hong kong turned violent yesterday let's get to eunice eunjung

taking -- yoon. >> reporter: the way the protest could affect u.s. and china depends whether or not president trump decides to use them as a pressure point for beijing in the trade talks. so yesterday president trump had said that the hong kong protesters are looking for democracy and that, quote, unfortunately some governments don't want democracy well, today the foreign ministry slammed president trump's remarks calling them, quote, gross interference, that china has been signaling -- signaling ahead of the g-20 trade talks that it did not want the hong kong protest to come up in the discussions between the two presidents there's been a lot of fear that president trump could use the hong kong protest as an excuse to slap beijing with tariffs in fact, that fear still exists. so the protesters have been arguing that a controversial extradition law should be completely dropped their fear is that this law could allow beijing to have more influence over their civil

liberties. as for the international business community in hong kong, they are very closely monitoring beijing's response if there's any indication, they tell me that beijing is going to in any way break down the separate status hong kong has with mainland china, then that would be a trigger for many of the people in the business elite as well as other companies to leave the city, which would be seen as devastating for the financial sect orror so far that isn't happening. it is closely monitored and many people edge hadding their bets and delaying investment. alibaba planning a second investment in the city we called to talk about it, they wouldn't comment grektly about the plans. they told us pretty much everything is the same, business as usual they hope for the best for hong kong alibaba does have a big

investment, owns south china morning post, the local paper, so it does have other investments in the city. >> eunice, thank you eunice yoon from beijing joining us with his take on all of this goldman sachs macro research asia chief equity." good to have you here. i don't know if you had a chance to listen to mr. navarro as well. >> i did with great interest. >> anything strike you >> i guess a couple of things. one, our view, was very happy to hear validated, this at least gives a window for markets and at least in the short-term constructive that we would put a piece out yesterday. i think relative to what market expectations were going into the g-20, there was a mild upside surprise in terms of getting more negotiating space, not having a 10% tariff put on that so-called list for and mild concessions on huawei, which you

were discussing. so the key point i like to make from an investment standpoint is that we have a market-based indicator of how optimistic or pessimistic the market is with regard to trade. we update it daily going into the g-20, it was suggesting only 18% chance that the market was pricing of a trade deal moreover investor positioning is quite light right now. so with people conservatively positioned going into the deal, into the negotiation and somewhat better outcome than the baseline, that suggests to us at least in the near term that markets could have a bit of an upside move, which we've seen in the shares as well as yesterday overnight with h shares in hong kong. >> where -- today i think it was, what is it advice premier lee talked about negative investment list nor foreigners, world economic forum, thais a positive in europe

>> at the margin, yes. maybe if i could step back and quickly summarize the bigger picture. there's so many different moving parts, i think it's helpful to contextualize things an environment where unfortunately call a high noise to signal ratio. our baseline moderately constructive because we think markets are decently priced. china is inexpensively priced, we have a severe pivot by the fed as we know with market pricing, that's percolated out global global we're out of qt back to pretty much qe and that's very supportive for asset prices. the problems, challenges, number one, you've got this uncertainty about trade. in the near term we've got positive news but there's going to be some tos and fros on this, there's a potential downside as discussing, if the list of tariffs go into effect that clearly will have a downside for growth and earnings. i can go into more detail on that, we've done detail work analyzing scenarios but there will be downside to a certain

extent moreover, evaluation risk around that in terms of uncertainty and so forth that's the first big thing second thing is clearly a coordinated slowdown in global growth the image we have is like two mountain goats butting heads you've got concerns about trade and slower growth, support in terms of easier financial conditions, inexpensively priced markets and conditioning we think that means on balance modest gains for equity markets in asia but with a lot of amplitude and noise around that. that's basically the world we're in. >> how do hong kong protests factor in here >> so i live there, so obviously i'm seeing it right up close there was certainly way more than 300,000 people that the government's official number suggested. who knows if it was 2 million or not but closer to the upper number than the lower number i think with the outcome so far in terms of the bill being put on hold, which is probably just going to be allowed to die a quiet death if not fully rescinded. >> is that what you think?

>> that seems to be what the game plan is technically i understand that if it's not sort of reenergized, then it will die by next july. so the face saving way to have that go away is to not talk about it and let it sort of die its own natural death. that would preserve status quo in hong kong which is much better than what the concerns would be before. in conversations with investors, there obviously is kerp about this those have rescinded i think one of the issues that many people have been focused on is what about the property market because hong kong is asset intensive area, the equity market is asset intensive. certainly for property our sense is that things are actually still in a good way. the property market valuations are quite high number one, demand supply is tight. number two, interest rates again falling at super low levels, it's very hard to make a negative case for property, particularly investors who pay a very high dividend deal. at least for the near term, we think things are on a pretty

decent keel. >> what should i make in terms of global growth back to your macro picture here we've got ten-year german negative -- >> minus 36 basis points as of last night global growth is slow. let me get numbers on the table. we have a monthly tracker of global growth called current activity indicator, refreshed today, 2.6%, peek was 5% a leading global indicator fallen to 2.4% there's no doubt we had a pick up in the first quarter and things have rolled over in a coordinated way. u.s. current indicator 2.1% first quarter now 0.8% for june. that might be a little overstated on the downside because of concerns in the manufacturing survey regarding mexican tariffs which actually didn't come into effect. the bottom line is growth is slowing, europe, japan is slowing. china is slowing as well

so we need more monetary policy. that's clearly what we're getting. that's the uneasy tension we've got overall. >> what is the actual chinese growth rate? how much is it slowing >> on our monthly activity indicator based on more frequent data, things grog 5.5% currently, target this year is 6 to 6.5 i was just in beijing with policy meetings last week so pretty fresh on this certainly feedback from these meetings is china recognizes they most likely will need to do more in terms of fiscal policy stimulating infrastructure, prudent monetary policy. that's their catchphrase probably some easing of macro prudential constraints perhaps on property and perhaps being more flexible in the currency in the market demands that. >> tim, thanks for stopping by sharing your thoughts. >> pleasure as always. >> tim mo from goldman sachs. >> when we come back, sneaker setback, nike pulling a shoe after reports of complaints from

normer nfl playing colin kaepernick one company fighting back. details on this story. dow positive up 24 points now. "squawk on the street" will be right back

good morning, everyone i'm sue herera, heavy rainfall in mumbai causing a wall to collapse killing at least 15 people and injuring 66 multiple rescue teams searching the area after the wall collapsed during the night police say more casualties are fears at the site of another wall collapse. stealth fighters took continuing tensions with iran. f-22s deployed to airbus in the united arab emirates australian terror police arrested three men in raids across the city filing an isis-inspired plot targeting a range of buildings and embassies. two of the arrested men have been charged with being members of isis. nasa conducting test launch of orion spacecraft blasting off

from cape canaveral this morning. it was part of a critical safety test of the mot you'll's abort system the orion spacecraft is set to take two astronauts to the moon in the year 2024 you're up to date. that's the news update this hour, guys i will send it back downtown to you. sarah, back to you. >> sue, thank you. time for etf spotlight, getting a check on oil and the energy sector moving closer, xle, oih and xop, a slowdown on command, despite opec and allies degree to extend oil supply cuts until march of this year. xle's top holdings all in the red including eog down more than 3% as you can see. a sea of red in the oil patch today. >> "squawk" mi bk te is quick break don't go anywhere.

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white house trade adviser peter navarro joining us to discuss trade talks, the market, the fed taking a swipe at fed chair jay powell have a listen. >> jay powell through us i don't know if it's a curveball or fastball at the head but that cost us a half to a full point of growth we can get that back if the fed does the right thing. >> joining us now chief investment strategist and chief equity strategist. welcome, gentlemen tobias, navarro says all we need is for the fed to cut interest rates and to pass usmca. is that right? >> i wonder if that's the right thing. if the economy is slipping because of the concerns about the trade policy or japanese

economic trends i'm not sure if fed rates get you there. i think investors want to see economic growth. i prefer we don't get influences from the white house, i'm not sure that helps financial markets. >> what do you think do you think the fed can get us to new highs >> no. we've reared an entire generation that believe you should buy stocks because the fed is cutting rates and quantitative easing. last year the market was going up too fast, interest rates going up too fast, then we had the correction in the fourth quarter that shocked everyone. we believe like tobias, we're fundamental investors. stocks go up not kauste of earnings but economy is proofing when you're managing rhetoric more than managing positions, you get into one of these markets we've seen the last two

or three months where we're managing every other position. like tobias, we're worried with respect to the short-term nature of what's happening in the market no other time in my 30-year career have portfolio managers had short-term sight with positions with respect to their portfolio. we're not investing in portfolios we're managing rhetoric. >> over the short-term we still think -- >> brian, explain that to me, 30 years, short-term. what are you seeing you haven't seen before? you and i can go back to a period of time when people had very short time horizons what's unique about this >> what's unique about this is that the majority of investors, really since christmas to mid february, missed the move. number one, they were underpositioned. they rallied back up and very crowded in fangs again they rallied around until they saw daylight with respect to the

trade rule they chased up the market with respect to interest rates going down and so when we talk to investors and go out and actually market, the best sentiment indicator is talking to clients clients have been more busy redeeming their shares in apple than actually thinking about what the next stock is to position in. clients have owned too many stocks, trading around the margin and as a result turnover has increased and sharp ratios down dramatically. returns down dramatically with respect to portfolios because people are too short-term oriented. >> so let's think a little bit longer-term, tobias. earnings season is upon us how is the market set up for this season and expectations for the coming quarters? >> i think pretty cautiously we just completed an institutional client survey published over the weekend one of the things we saw 1.4% on weighted average basis street consensus is more like 4 1/2% for 2019 earnings growth.

streets are ready if you want to think of it. money managers ready, cautious going into the second quarter and into the second half 90% of them think large caps will outperform small caps that tells you something about their lack of willingness to take anything speculative. so i think investors are somewhat cautious, no longer in panic, at the lower ebb of what i would call worried the one i would want to come back to david's original question, though, about what's different in the markets in the more trading oriented mechanism is this whole issue of active fund managers competing with passive money. this wasn't true 30 years ago, didn't have etf structures you have to do have you to perform. it's real life musical change in terms of if you don't perform over a quarter's timeframe you might not just lose your job or this year's bonus but career that's incredible pressure for fund managers. >> you opened a whole can of worms there but we're out of time we'll have you both back on very soon i'm sure. brian and tobias, thank you.

>> thank you. all right. we've got some auto sales numbers that are crossing the tape let's get to phil lebeau for that. >> three, start with general motors q2, gm sales dropping 1.5% of noteworthiness is the fact you look at silverado and sierra pickup truck sales they were down in the second quarter. now let's shift gears to fiat chrysler these were june numbers, sales up 2%. you heard me talk about slowing pickup sales for general motors as they do a transition there with the silverado and sierra. at fiat chrysler, ramp pickup truck is on fire right now sales up 56% in the month of june finally we'll end with toyota. this is monthly. june sales for toyota down 3.5%. overall, guys, the expectation is that the sales rate for the month of june likely in at 16.9 might tickle 17 million for a pace of sales for the month. guys, back to you.

>> all right thanks for the update, phil. thanks. up next, shameful retreat for the company. one governor speaking out against nike's move to nicks sneake frseaturing an early version of the american flag bring you the latest details on this one

one top investors says history is a top rlyoral f stocks find out more or trading nation on cnbc.com. more "squawk on the street" is coming up.

so we can confirm here at cnbc that nike is pulling sneakers featuring an early american flag, often called the b betsy ross flag after colin kaepernick told the company it shouldn't sell a shoe with a symbol that he and others consider offensive because it harkens back to a period of slavery in american history. the company telling us, quote, nike has chosen not to release the air max 1 quick strike

fourth of july as it featured an old version of the american flag taking a look at nike shares, they been pretty strong, rallying about 15% this year off a bit with the broader market. the shoes were set to be released in collaboration with the fourth of july holiday they often do these kind of limited edition releases and now this morning, reaction from the political world the governor of arizona tweeting, nike has made its decision and now we are making ours i've ordered the arizona commerce authority to withdraw all financial incentive dollars under their discretion that the state was providing for the company to local here. arizona's economy, he says, is doing just fine without nike we don't need to suck up to companies that consciously denigrate our nation's history 500 jobs there at stake, potentially. >> is that what it was in that new air max factory? >> why does nike find itself at the center of these kind of controversies so often >> nike, i think, considers itself a progressive company and not a political company. and there's a distinction here so we've had this. last week, nike pulled shoes in

china after the designer of the shoe put up on instagram support for the hong kong protest. and then, of course, the colin kaepernick yes, they get into -- they wade into the culture wars. they do controversial things but they have not seen any sales impact >> well, they know who their customer is, i guess, sara >> they know who their customers are, they don't make decisions fly by the seat of their pants this is not that kind of company. it's not our job to adjudicate whether the flag is appropriate or not, but from the nike company perspective, they would argue, they've got a pac, they support candidates on both sides of the aisle they're not trying to be overtly political, though they are trying to have a little bit of a voice. >> are they happy that a story like this is out there >> definitely not. >> definitely not. you think they would prefer that it never saw the light of day? >> and especially all the political attention. i don't think they meant to garner political attention by just pulling a shoe that some might consider offensive

but that's what happens in this kind of very divided government that we live in where people are looking for things to be offended by or looking for companies that are too pc. it's the number one trending topic right now on twitter so far, their sales have been like this. we just got another quarter for nike, north american sales in this key home market, their biggest market, up another 9%. and that's been the trend over the last year. so until that starts to hurt to investors -- >> until people start voting with their feet. >> with their feet their shoes. >> "squawk on the street" is right back after this. (soft music) - when i see obstacles, i create opportunities. - when i see adversity, i find a way. - when i hear never, i say now. - [announcer] southern new hampshire university is education made to fit your goals with over 200 degree programs, flexible class schedules, and some of the lowest online tuition rates in the nation. (cheering) - so when i face barriers, i can break through. - [announcer] breakthrough at snhu.edu.

sara, what have we got coming up on the "closing bell" later today. >> so we'll see if this market can sustain these gains, right any gain would be a new record high so we are on watch for that in the final hour of trade, of course we're also going to talk oil and the opec decision. we've got former saudi aramco head sadad al hussein. and jim press will be there to break down the auto sales numbers as we await tesla's second quarter deliveries as well > teaim>>inhe mnte, dow's just positive, up eight "squawk alley's" up next don't go away.

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good tuesday morning and welcome to "squawk alley." i'm morgan brennan with sara eisen and deirdre bowsa live frm post nine at the new york stock exchange the women are running the show today. we begin with tech stocks, coming off a record close, and its best first half since 1998, despite trade and regulatory concerns, continuing to weigh on big tech so can this sector continue its record run up for the second half of the year joining us now is walter piezek as well as charles brazinsko