>> it is 5:00 a.m. at cnbc here is your five at 5 show time for powell the central bank prepares to release the latest decision. >> also today, saudi arabia set to hold a news conference following those devastating attacks on two of the largest oil processing facilities in the world. and return to sender shares of fedex sinking. warning on everything. and the ceo of wework laying it all out to his company hours

after delaying its ipo and new details on facebook's newest project to develop augmented reality smart glasses. "worldwide exchange" starts right now. ♪ >> good morning, i'm courtney reagan in for brian sullivan this morning shares of fedex crumbling. the company missing on earnings and lowering guidance. much more on that stock coming up you can see shares down more than 11% in the early going. here is how your money and global markets are setting up their day. stock futures are indicating a slightly lower average dow jones lower by 34 points

s&p by 4 and nasdaq by 10.5. it is fed day. that is really the focus not just in the u.s. but around the world. looking at the bond market we continue to watch closely the different between the 10-year yield and the two-year yield the two year is 1.711 and the 10-year at 1.77. in japan, stocks closing slightly lower so nikkei down the hang seng as well. the composite is up by about a quarter. everyone waiting to see what will happen when we hear from the federal reserve.

in europe, largely higher but just slightly in germany and france this morning. it looks like the strongest market at this point is the italian index. to saudi a rabia now, oil i giving back the majority of its gains earlier this week after they said crude production will be largely back to normal by the end of the month sooner than some had feared. already restored 50% of production lost. at the same time, iran continuing to deny any role in the attacks despite increasing intelligence otherwise chairman powell is set to deliver the latest policy decision in just a few hours investors are expecting another

25 basis point rate cut. president trump hoping for more. let's bring in julian howard thank you for joining us here today. i imagine your expectations are for that 25 basis point cut. it seems like that is largely telegraphed, no? that's right anything different than that would be a shock to the market the key is to be around the company. how will they be absorbing we have this narrative of everything slowing down. some of the numbers coming out of the u.s. economy, not too bad. households holding up. is that going to put the fed off

course it is reasonable to assume that will go on >> for so long, pointing out frmt the fed changed the policy to be more of an insurance play. is that how they should be looking for this at least for the relative near term >> that is right there is much more forward looking now, actually looking ahead to see what might happen to the u.s. economy and the trade war. that is having an effect to the economy. it is not killing it or throwing it into recession. on the other hand, it is more likely the economy will need support. i think the trade war will be protrack tiff. you look at the democratic debate nobody was really coming out against tariffs, which i thought

was extraordinary. most of the u.s. population is protrade elizabeth warren was starting to sound a bit like president trump in terms of protectionism. this could go on for a long time and it suggests the u.s. economy will need support. >> if that is true, is the united states market something you think is still a good investment place for investors around the world or here in the united states to be putting their money if we don't know what is going to happen with the trade war and is so much uncertainty for corporate planning >> we have been writing about this idea about fortress america. even though the united states political system is creating this trade conflict around the world. the pressure of the u.s. economy

lends itself to be the last man standing 70% of the economy is services based. you compare that with japan and europe and those are highly plugged in to the global supply chain. america will be the relative winner in this war even though america will perpetuate this issue, you are better off in u.s. assets. it has a bigexport sector. if you look at the u.s. retail sales, pretty much lock step the consumer is in good shape. the consumer is in good place to be >> despite the volatility they have, the s&p 500 is still within 0.7% of those record

hiehie highs. time to get to your stock of the morning. fedex. shares are sinking we have more now >> as you mentioned, shares are down more than 10% closer to 11.3%. after the shipping giant reported a big drop in reported profit they expectings to fall between 16 to 29%. fedex is also lowering the revenue forecast they continue to face weakness in its express unit which delivers packages by air and is being hurt by the u.s./china trade war. thanks largely in surge to online shopping but it is spending to keep up with that demand fedex will try to keep growing in e commerce but without

delivering packages for the biggest player in the u.s., amazon, you might remember, fedex recently ended their biggest contract with amazon that accounted for $1 billion a year >> these contracts represented only a small portion of our revenues the near term show is significant flow to the bottom line we have closed additional business to replace this traffic. >> that additional business there, fedex aligning itself with other retailers names like walmart and dicks sporting goods. processing all of those on line orders open. plunging 11.3% in on line trading. >> can definitely a big one to

watch. when we come back, why the w window to go public this year is getting smaller and smaller. and tech under fire in more ways than one we are watching one cloud player which came in with weak guidance stick around, "worldwide exchange" will be right back 20 . no two patients are the same. predicting the next step for them can be challenging. today we're using the ibm cloud to run new analytics tools that help us better predict and plan a patient's recovery. ♪ ♪ ultimately, it's helping thousands of patients return home. ♪ ♪

>> new developments in wework's push to go public before year's end. ceo adam neumann getting real saying, quote, he had been humbled and he needed to learn a lesson about running a publicly traded company oth others contributed to his decision to delay the offering >> lawmakers grilled the justice department and ftc officials calling the anti-trust probes empty suits as apple continues to fight european union watch dogs in court calling their $14 billion bill for back taxes a reality and common sense >> and senate fighting on line

extremeism joining us now from london, a lot to get our hands around here give us an overview of what happened yesterday some pretty strong words in that panel. >> strong words, they are taking the lead on big tech getting their own chance in the hot seat yesterday. we heard from ftc chairman and assistant attorney general kind of admitting there has been overlap in their investigation like companies like facebook and google we know the ftc is conducting their own antitrust negative ocean at the same time as the justice department proud review. some senators saying these agencies need to con doll sat and not overlap quite as much on these. the two regulators didn't give away that much on the way they are preceding.

the probes are a top priority so far and will continue to put these tech companies front and center >> there is a lot more to go in the understanding we need to get our hands around when it comes to the apple/eu hearing. how is that playing out in court? >> so this is a really interesting case this is apple and ireland facing off in the second highest court of the eu and second day of hearings happening today all about the order in 2016 requiring apple to pay back just over $14 billion in back taxes to ireland the argument is that apple received illegal benefits. they are saying that is not true and the court order defied reality saying it had paid its fair share remains the largest

taxpayer in the world. the decision won't be reached for months that decision could be appealed to the top court so this tax feud could drag on for some time. >> that is a lot of money. lastly, on the extremeism hearing. what are tech companies going to say they are doing to combat extremeism on their platform there is also the free speech argument this is really difficult >> it is really difficult. in light of some of the mass shootings. today, we are going to hear from facebook, google and twitter in the center of the hearing. they'll likely talk about how heavily they are vesting in tools.

facebook yesterday revealed plans for a new oversight board that can oversee content on its platform the companies will say they are working to figure out how that dynamic will play out especially when threatening content is identified this is a very hot button issue and we are likely to hear strong words on both sides. >> we know we'll come back to you often. appreciate you being here with us this morning. still on deck, chewed up chewy under pressure time to double down again. kfc jumping on the fried chicken sandwich craze with a new twist. i mean you're still blatantly sucking up to me gary.

brilliantly observed, sir. always three steps ahead. six steps ahead. sixteen. so many steps. you done? a million steps ahead. servicenow. works for you. i need all the breaks as athat i can get.or, at liberty butchemel... cut. liberty mu... line? cut. liberty mutual customizes your car insurance so you only pay for what you need. cut. liberty m... am i allowed to riff? what if i come out of the water? liberty biberty... cut. we'll dub it. liberty mutual customizes your car insurance so you only pay for what you need. only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪

i that's the retirement plan.e, with my annuity, i know there is a guarantee. it's for my family, its for my self, its for my future.

annuities can provide protected income for life. learn more at retire your risk dot org. >> let's get a check now on some other stocks on the move for you today. adobe reporting better than expected results but give a disappointed forecast siting lower bookings and newly acquired software business shares are down about 3 pergs. shares of chewy are down as well after the on line company reported a wider second quarter

loss mainly due to transaction costs. the company does see third quarter sales. chewy ceo talked about the out look on closing bell >> if you look at the customer base growing with us we've added 3.5 million customers. look at the united states. we have got 12 million active customers on our file. there is a lot of good momentum in front of us cew being added. the company will replace total system services. shares are up about 6% still to come, more trouble for juul after new york becomes the first state to ban flavored

e-cigs and more from saudi arabia "worldwide exchange" is back tethis do you have concerns about mild memory loss related to aging? prevagen is the number one pharmacist-recommended memory support brand.

you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life. here, hello! starts with -hi!mple... how can i help? a data plan for everyone. everyone? everyone. let's send to everyone! [ camera clicking ] wifi up there? -ahhh. sure, why not? how'd he get out?! a camera might figure it out. that was easy! glad i could help.

at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your xfinity store today. . >> let's get a check on this morning's headlines. to new york. >> new york bans the sales of

e-grets. voting to carry out the action that goes into effect immediately. retailers have two weeks to comply this comes after the seventh person has died with issues related to e cigarette kmi indications. >> president trump touring to a wall returning to the site where he vowed last year to stop up to 99% of illegal immigration we are getting a first look at where the 2020 race stands. according to a new poll, two contenders have pulled ahead of the pack former vice president joe biden is still in the lead with senator elizabeth warren

trailing by 6 points senator bernie sanders is at 14%. back to you. >> thank you this is a race we'll continue to watch very closely when we come back, missed delivery why shares of fedex are said to open deep in the red down about 12% why our next guest says our rate cut may only be a small taste of what is to come from fed can chairman jay powell. yeah it does, look. i'm not sure it works that way, but at cdw we get that time is precious. so we'd access your needs then design a nutanix enterprise cloud. to give you more time to grow your business. yeah that's better. hey we still on for lunch at 15 o'clock? you bet. for private cloud solutions you need nutanix and it orchestration by cdw.

take prilosec otc and take control of heartburn. so you don't have to stash antacids here... here... or, here. kick your antacid habit with prilosec otc. one pill a day, 24 hours, zero heartburn.

>> decision day at the fed we'll tell you what else the central fed will be doing that has global markets on high alert. saudi says it will restore output a report to come facebook's newest vision could have you turning in your newest smartphone in favor of a pair of shades it is september 18 you are watching "worldwide exchange" on cnbc. ♪ >> welcome back. i am courtney reagan in today for brian sullivan we are half way through the 5:00 a.m. we have four hours to go until

the opening bell sounds. the dow jones, nasdaq and s&p 500 indicated slightly ower opens. a lot waiting to see the decision and commentary will be. let's look at what is going on in the treasury market as we look at the spread between the 10-year yield and two-year yield. two year sitting at 1.711. looking at the asian markets remaining focused on the reserve. a bit of a pause in a lot of big movements around the world for trading before we hear from chairman powell. we did see mixed action in asia overnight with the shanghai kpozikpo composite higher european markets open for trade.

we have several hours to go largely in the green muted as we wait for the federal reserve. turning now to saudi arabia. set to hold a news conference later today following the weekend attacks on the the processing facilities. as they gain back some of its gains. wti higher by 5% right now hadley joins us from the region. >> reporter: good morning. we saw a major price correction after a press conference even before that where the saudis were really trying to calm the market saying they are going to be back to full capacity and output in a few week's time. by end of the day, they'll be back to output behind the scenes this is really about calming the markets and

keeping higher oil prices from helping iran i had a chance to ask about that long awaited aramco ipo. this is what the shaichairman ht say. >> we think the ipo will continue we are not going to stop anything this will make us be firm when it comes to taking the company public i think any time in the coming 12 months we'll be ready as per the market opportunity. >>the question is how do they protect oil fields it was interesting, the oil minister said we don't know who was behind these attacks

we expect to hear more evidence as they layout all the evidence that ties this directly to tehran that will be hours ahead of a press conference with secretary of state mike pompeo and his counter part we are told we should expect to see the secretary of state talk the ma lined behavior. >> all very interesting. i understand the state department is warning americans of traveling to saudi arabia >> absolutely. you'll remember these terror attacks aren't the only things that have been happening in the last 6 to 9 months in this country. we've had multiple rocket attacks, attacks at the airport. at the same point.

that is a question i asked yesterday. my first question for yesterday. kicking the can down the road to the press conference we are expecting later today. the united states state department saying americans should exercise extreme caution. >> it did say markets are relieving what they had to say getting back on line by the end of the month is there consensus on the ground that that is the truth certainly the markets are believing it >> they are believing it they even admitted to us, they got a lot of spare capacity. we are talking about trains and train tracks, that won't be

repaired overnight that will take weeks to months they did stress how quickly they were able to get back on their feet they were literally fighting like 13 fires at once. they really want to emphasize the strength of saudi aramco and the fact that that ipo is still on track. >> and wto crude still below $15 here other stories, we are watching results in the israel election prime minister netanyahu appearing to fall short of majority winds of change are blowing. going to the polls for the second time this year delivering a result that delivers more questions than answers

a devastating blow for prime minister netanyahu who asked the people to put their faith in him for another term despite a campaign that has come under criticisms for close associations with president trump and russian president putin. also a blow for his rival as well here in israel, gantz who has only been able to achieve 32 seats of the necessary 61 seats in this 121-seat parliament. both men vowing to work with smaller parties and religious parties to form a smaller government both sounding confident this morning. listen in. >> in the coming days, we'll assemble a strong zionist government >> translator: starting to

night, we'll form a strong government that will address the will of the people and society >> especially if this election remains too close to call. >> the central bank widely expected to cut rates again. yesterday, the fed injected funds for the first time since the crisis and said they'd do it again today. this came after factors sparked a sudden short fall of cash and markets shot up for some overnight loans. whenever i feel like we say anything is the first time since financial crisis, it sparks concern, if not fear should that spark any concern in

the repo market. >> as far as the fed today and what they are watching is for a hawkish cut which would provide a 25-point basis cut and that they are not going to do any further cuts. >> so you are not concerned about action in the repo market. >> right i'm not sure it is just something they are doing >> we haven't seen a lot of moves for a prolonged period of time recently, we have seen inflation start to tick up what are you watching here on what may influence fed policy. we saw core u.s. inflation rise by 0.3%.

a third month of gains that would mean the core inflation would move to 3% by using the measure. that would put inflation right about where the fed wants it if you remember back, they said the downtick would move back it looks like they'll maybe move closer to 2% maybe we don't get anymore fed rate cuts tick up. >> does that result in higher prices the consumer is paying? >> no. i think it is more related to the cost of health insurance we'll probably also see an uptick in oil prices >> today, we expect to see the fed give a 25 basis point rate

cut. some saying jerome powell is not going to show his cards. what do you expect he'll signal? >> the thing to watch for is that in the past he's made comments this is a midcycle adjustment i think he'll probably remove that commentary to take that off the table and correct for an error they made in the past. >> if these are expectations, how should you be positioned in the markets? i think consumers are more optimistic you have the prospect coming out of germany for the first time, which is a pretty big deal if that does happen you have u.s. and china trade tensions you have data picking up in the u.s. that was some what unexpected.

mae optimistic making it hard to get too bullish. if you look at north americat hd significantly since 2018 you are looking back at this environment in early 2016 where we had worries of global recession. we had growth around 1.5 to 2% we had markets at or near record highs. it is hard to get bullish when you have the same type of environment. >> very interesting especially after hearing from fedex last night. thank you for being here this morning. speaking of that, back to the big stock to watch today fed e678 shares down more than 11 pirs. a drop in fiscal first quarter profit and cut its out look for the year citing the impact of the trade

war, higher cost associated with the ground unit and the split with amazon. >> beginning in the fall of 2018, it had become clear global trade disputes were adversary affecting manufacturing in europe and asia, there by slowing international shipping demand joining us now, david ross, global analyst i have to say there was not a lot of encouraging headlines out of this report and earnings call what is most important to you now at least for the fedex forward looking outlook? >> after the decline and seeing the drop since 2009, their

package drop was up year after year they took the guidance down at the midpoint and have to reflex the drop from there. what they are seeing ahead is most concerning to us. it means a drop in volume. fedex has been vesting for growth as they vest for growth, that will lead to the margin squeeze in the near to immediate yes, term >> fedex is looking to amazon in a near way now it is a competitor how much does that change the landscape for fed ex >> i don't think it changes it too much the past couple of years, they've been deemphasizing amazon and saying most of their business did not come from amazon to begin with the decision to walk away from amazon on the express side and the ground side this summer is

creating the challenges and gap that needs to be made up outside of that, fedex continues to grow their package volume even as amazon grows itself with package volume >> getting to the trade war, what should we be understanding about how that is interrupting or squeezing fed ex's business if there is any relief in sight to do to mitigate some of that pressure >> really out of their hands when it comes to the tariff issues it encourages global and open trade. the chinese economy gets hit it has a negative impact on europe european exports with a drop

you've got a general decline in exports. what it can do is really integrate the tnt operations in europe that is challenging, so it is not a foregone conclusion that will happen successfully to the degree fedex wants it to that is the help fedex wants it to be. >> we often look at a company like fedex or ups as an economic bell weather should we be worried >> on a global macro, yes. from a u.s. economic standpoint, they remain strong

there remains this strong healthy economy with the back drop of slowing economic growth globally >> david ross, thank you coming up, facebook is working on new smart glasses with ray ban with code name ryan next if you love chicken and doughnuts and who doesn't. kfc has a new menu item that has everyone buzzing this morning. details when we come back. you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated. but you're not mad, because you have e*trade which isn't complicated. their tools make trading quicker and simpler. so you can take on the markets with confidence.

don't get mad. get e*trade and start trading today.

don't get mad. great riches will find you when liberty mutual customizes your car insurance, so you only pay for what you need. wow. thanks, zoltar. how can i ever repay you? maybe you could free zoltar? thanks, lady. taxi! only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪

>> let's find out what else they'll be talking about today time for top trepding stories. >> so facebook is getting into the smart glasses business reportedly developing two glasses. ray ban is designed to compete with snap chat spectacles. and will allow users to take phone calls and view on a smart display and eventually replace

smartphones. i always feel like i'm living in a sci-fi movie this doesn't help. >> me too. also i break sunglasses all the time are snap chat inspespectacles something that need to be competed with. >> friends of dowton abby can be royal for the light. owners of the castle have listed the castle on air b&b. you have to submit a written application to be considered apparently, it's a really famous

castle 300 rooms. >> wow to get the whole thing for $187. i think the lady and the lord will be there. you get to keep a portion for the night. >> a show on netflix my mom found called weekend aristocates. these families have these castles and they rent them out they are very expensive. such a cool idea >> i love how we are going from arrest o aristocats to chicken. >> kfc features their chicken

amid two glazed doughnuts. currently available in virginia and pittsburgh no word if a national roll out is expected. >> people think it is crazy. >> it is really, really good i love doughnuts and i love fried chicken. >> i don't eat fried chicken i'm a vegetarian but i understand apparently the chicken wars rage on >> thank you on deck, synchro nice your watches. later this morning, don't miss ken langone, the home depot

cofounder will join "squawk box. "worldwide exchange" will be right back ah, you could say that. so how are things with you guys? great. thank you. thank you, sir. lunch next week? terrific. say hi to the team. will do. call my office, i will. -sounds good. alrighty. servicenow. works for you. hey. you must be steven's phone. now you can know who's on your network and control who shouldn't be, only with xfinity xfi. simple. easy. awesome.

>> time for the executive recap. headlines you need juul sales have been stopped in china days after products went on sale there. no word what caused the change but amid changes here in the u.s. facebook handles privacy and content concerns the group will govern appeals and have the power to overturn the social media giant's own decisions. a panel has asked boeing ceo to testify. the house is investigating the now grounded 737 max following

two deadly crashes we are hours away from the federal reserve's interest rate decision predicting 100% chance of a quarter-point rate cut but our next guest says today's decision could be the start to a series of cuts michael, thank you for joining us i'm surprised to know you think it will be the first in a series when so many think jay powell will be playing this one closer to the vest than he has. why do you think this is the first of several cuts to come? >> our view would be that things are slowing down yes, the u.s. consumer is doing quite well we are still seeing softness in

manufacturing and business spending our view is that they'll end up cutting more we just think they need to do more than to continue the expansion. we think they cut today but don't necessarily commit just that the softer data will continue to do that. >> we asked our previous guest if he was concerned and having to inject the cash when you hear things like this is the first time it happened. even for technical reasons should that be a cause for concern and anyone worried about the u.s. economy >> i would separate the rate decision from the day-to-day management it is a signal that reserves are too low.

the balance sheet needs to be bigge bigger they need to get along the process. we do get these periods of time when there is demand for reserves i would call it more of a management issue i'm not concerned about it >> what do you think is the biggest risk to growth looking at its policy as far as insurance to future problems >> the biggest risk is to say, we may just be in early stages of this whole transition between trade in the u.s. and china. we are programmed to think a shock here and shock there i worry if we are in a regime

shift, it could take several years or more for trade volumes to adjust. you need to take out more insurance and hold that for longer >> thank you for joining us here this morning that's it for "worldwide exchange." "squawk box" begins right now. >> good morning, show time for jay powell the central bank prepared to release the latest policy decision and a forecast likely to disappoint president trump fedex chairs are plunging. we'll show you what ceo fred smith said about the trade wars and losing amazon's business and adam neumann speaking to employees just hours of that statement released "squawk box" starts right now.

>> announcer: live from new york where business never sleeps. this is "squawk box". >> were live from the nasdaq market sight at time square. our guest host for the hour is black rock's kate moore. let's look at what happened with u.s. equity futures. indicating slightly lower. do you slightly down after it was up by about 34 points yesterday. s&p down by just over