♪ good morning it's 5:00 a.m. at cnbc global headquarters. here is your five at 5 final trading days of 2019 kicking off this morning as the markets look to put a cap on what could be the best year in two decades. tesla's model 3 officially rolling out in china less than a year after the company broke ground at its shanghai factory. weworks parachute packages we'll talk about that and new report on the high price the troubled startup will have to pay some of its executives the restaurant industry facing a big year of change. we are breaking down the new

frontiers for that sector in the new decade and facebook being called the new cigarettes for our society by the founder of salesforce.com his critical take on the social media giant as "worldwide exchange" begins right nowe to exchange" i'm dierdre bosa in for brian sullivan the second to last day of 2019, take a look at stock futures right now pretty much flat they are on track for a block buster year as i mentioned the s&p on track for potentially its best year in two decades if it can squeeze out gains of nearly 30%. 29.6% is the gain that we are looking at dow jones and the nasdaq also on

track for a record year. moving on to the bond market, the yield on the ten-year note currently 1.912% let's go worldwide now in asia, markets were mixed in the last two days of the years investors awaiting updates on the trade deal and increasing tensions with north korea. japan wrapping up its final trading day of 2019, down slightly, but the nikkei, that was up 18% for the year and what a turn around from last year when it was actually under water by more than 10% let ee's take a look at trade in europe it is slightly lower, the german dax trading down by about half a percent. the ftse down by one third of 1% these markets also in line for a very good year, so investors perhaps taking a little profit off the table. let's look some of the other top stories we're following this morning and rahel solomon joins

us with those. >> a lot to get to this morning. so wework will reported will have to pay close to $17 million to its koe-chief executives as part of exit packages. so this is according to the financial times. and the agreement was negotiated amid the company's bail out by softbank the ft says that the two will receive more than $8 million a piece if they are fired or if they leave for a number of reasons. meanwhile, weworks chief legal officer will receive $1.5 million under those same circumstances. overseas, regulators in egypt signed off on uber's $3.1 billion deal to buy a regional rival. uber offered a set of commitments meant to reduce harm to competitors the deal is expected to officially close next month. turning to oil prices, they're hovering at three-month highs this morning thanks in part to optimism over the expected u.s. china trade deal

investor also keeping a watch on the potential fallout of u.s. air strikes over the weekend happening in iraq and syria and happened against multiple weapon facility linked to iran. additional actions may be taken. back to you. >> rahel, thank you very much. turning back to the markets, stocks trying to keep the year-end rally rolling into 2020 gentlemen, thank you for being here bright and early. >> thanks for having us. >> now, the street pretty optimistic after next year after a block buster year. there's two days left. so what do you do next year? obviously no one is predicting the games will be as big next year but what do you do in terms of your money? are you diversifying more into oth other assets that didn't perform as well in. >> this was a titillating year for all investors. you could argue this is the best year of the entire cycle with essentially both fixed income,

international stocks and u.s. stocks doing really well you look at why that happened and it's because one recession did not occur that many people feared and fed fueling a lot of these asset classes. going forward those factors probably aren't going to help as much it will go back to plain old earnings growth, plain old economic growth especially if manufacturing can bounce back, other economic stories can bounce back and if that can occur, maybe we get about 5, 6, maybe 7% earnings growth probably not the 10% earnings growth >> james mentioned earnings growth and valuations have crept up this year so are we going to see that come to fruition next year, the fundamentals going to be there >> i think so. we look at these surveys coming out of europe, we're starting to see optimism there welcome further upside for earnings outlook coming into 2019, expectations were maybe we'll see 10, 11%

gain we're practically at 30% i think that right now everyone is being a little conservative, myself included, in targeting what we're going to see as far as equities growth for next year and probably could be surprised at the upside. >> conservative would mean single digit gains, right? >> yes. >> so let's talk about the concerns then could markets be complacent u.s./china trade war may have eased. what could throw off next year >> yeah. so we do think there is some complacency here last year you had a recession in expectations which of course did not play out the way many people had feared it would last year. this year it's kind of swung the entire direction all together. a lot of what you saw this year was just multiple expansion, valuation striving a lot of what you saw with all the returns around the world where we are now today is that

very few people expect a recession over the next 12 to 24 months very few people expect a pull back in the market and of course that is unsustainable. so i think it goes back to what you just mentioned that you probably will get back to probably by single digit, high single digit expected return and of course that goes back to what happens with earnings growth and economic growth around the world, but we should really be rationing back those expectations from a stellar year. >> i spent most of my time in san francisco so i have been looking through a different lens, some of the most ap tis pated ipo names to go public haven't performed quite as well. >> this year was a tough year for ipos we had many disappointments and i think you're going to see as markets have shown some signs of stabilization you'll see other companies want to come to the markets. i think that there's growing risks to the outlook for ipos. we need to see revenues. we need to see profits sooner

than later you can't have this bucket wish list of promises and expected growth down the road you have to be delivering results sooner i think that's going to change the way ipos are unveiled in the future >> yeah, there's names that have to go out. we still have a bunch of unicorns that have been private for much longer than in the past we used to see them go private. >> you have this interesting dichotomy. at a macro level, you have all this private capital private investments has been this huge growth area for the asset management industry and for good reason. you can't be looking at the public markets especially with the privathave been run. to your point about the ipos for this year and clearly the issues around softbank and wework a lot was about getting eyeballs and transparencies in the company and not focussing purely on top

line numbers but to think down the line of profitability. clearly there's some dynamic that's going to shift in the startup space especially close to ipo but we still expect a lot of private money to be in the space over the next few years. >> do both year models anticipate that president trump is going to serve another term >> we don't make election forecasts per se, what i would say about elections in general is that presidents get too much credit for the economic situations and the markets that result from that and vice versa as well when markets go the other direction. >> ed, what about yourself not necessarily will he be re-elected but if another democratic candidate particularly more left wing one does win the nomination, does that throw off your prediction for next year? >> election uncertainly will play a huge role there are surprises we could start to see unfold closer to

match when we have more -- one third of the pop list start to vote you're probably going to see a progressive not get the nomination buttigieg, biden will probably get the nominee. biden maintained a strong lead in wisconsin, iowa, michigan and pennsylvania if that's the case, these are the battleground states. we might see the markets price in possibly a little risk that a democratic could come out. if that's the case, that might hurt some of this growth that everyone is targeting. >> certainly an exciting year to look forward to. gentlemen, thank you very much for being here ed and james. >> thank you when we come back, tesla lays out its road ahead in china with the company's model 3 officially makes its debut there. plus a service outage by twitter. currently blocking the president from naming the whistleblower. and later, risks to the longest economic expansion in

our nation's history the potential hurdles that melee ahead in the next decade a very busy hour when "worldwide exchange" returns.

♪ good morning you're looking at a shot of times square new this morning, tesla achieving a major milestone in its effort to build its own cars in the world's biggest auto market, china. rahel solomon joins us again with the details

major achievement, 11 months. >> and ahead of schedule tesla started delivering model 3 cars from shanghai factory so that is a record for any global auto maker in china tesla previously imported all the cars that it sold in china and said it wanted to start deliveries from hang high before the lieu mar new year which starts january 25th. the company plans to ramp up deliveries next month, so tesla priced the china made model 3 at 366,000 or 50,000 dollars before subsidies and comparison, imported model 3 starts at 439,000 for the longer range version and the standard model costs under $40,000 in the u.s the chinese government has been supportive of the shanghai factory. the first fully foreign owned car plant in the country the plant is part of tesla's plan to boost its presence there and also reducing the impact of the u.s./china trade war

they held an event to mark the delivery of 15 model 3s and all 15 went to tesla employees who had bought one including this man who took the opportunity to propose to his girlfriend as we can see here, he filled the front trunk with flowers and hopefully she said yes >> do we know? >> he looks like he's still smiling and she looks like she's into it, so i'm going to surmise that she said yes and he has a nice fancy car to start their new life with. >> how can you say no? a tesla withthe front trunk full of flowers? >> nothing says romance like that. >> they like to do things fancy in china jack would do the huge wedding ceremonies at alibaba's anniversary. very china specific thing. what an amazing achievement. tesla and opening its factory in china first as you mentioned, fully foreign-owned one. quite the achievement in china and we're expected to get

deliveries for q4 later this week, could put tesla in range of its full-year guidance. >> yeah. couple big wins for elon musk. again, chinese government is on board, ahead of schedule good news to end the year with. >> tesla up nearly 30% year to date it could be a good year for the company. achievement for elon musk. still on deck this morning, from c suite shakeups to new trends, predictions for 2020 that's up next. the star wars box office haul continues to rise over the holiday weekend. details whether disney will have another billion dollar film before the year's end when "worldwidexcng rur ehae"etns beyond the not-so-routine cases. comcast business is helping doctors provide care in whole new ways. all working with a new generation of technologies powered by our gig-speed network. because beyond technology... there is human ingenuity.

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2019 marked a year of big shakeups for the restaurant industry here is more on what's ahead ♪ >> reporter: from tech yields to c suite shuffles, 2019 was a year of change for the restaurant industry. so what will restaurant bs serving up in 2020 first, technology takeover restaurants are becoming increasingly tech-focussed to speed up and personalize service. mcdonald's, starbucks and yum brands all made acquisitions or investments into tech companies this year. anl alysts say this will contin. second, delivery wars pick up. with more companies getting into

the delivery game, competition is increasing not only between restaurants looking to entice customers but between the delivery platforms third, menu innovation continues. new menu items had the internet buzzing. expect that to continue into 2020 as well as more collaboration between alternative meat companies like beyond meat and impossible foods. now, one thing is for sure, competition between all of these companies will be fierce for menu pricing to mobile apps to delivery partnerships as consumers continue to spend in a big way. >> mcdonald's still doesn't have a plant-based sandwich. >> they were testing in canada with beyond meat, of course, burger king has the impossible whopper and mcdonald's also got into the chicken sandwich, premium chicken sandwich a part

of the warlater, so they had a weaker than expected earnings report. a lot of analysts said you missed it. you sat it out you're the biggest restaurant chain in the world i mean, they will be getting in this year obviously, but is it too little too late? >> why are they waiting? >> a lot of analysts say they would cannibalize their own supply chain you have to make sure beyond meat would have enough to get you through. the impossible burger did run out. the same thing happened with popeyes. it creates a lot of buzz wow, it's really good. but it does matter and consumers could be frustrated if you don't have enough. >> i cover this from the uber eats door dash side of things, i got an email from sweet greens saying they are going to do delivery. >> they are. >> are more companies taking delivery into their own hands? why go away from the simplicity,

the ease of uber eats and the door dashes, those take rates going up >> well, that whole landscape is going to be so interesting i'm sure you may believe the same there may be some consolidation between some of these companies. dominos is the first one to take this in-house and do that whole tech pipeline. on the own, you're seeing companies doing that but we have seen companies that have done it themselves or gone at it with just one partner start to open up now like mcdonald was only with uber eats and now they're partnering with other carriers. so i think companies are looking out and seeing what makes the most sense for them. and if there is consolidation on the back end with the delivery companies that's great too sweet greens is so much smaller, too. >> if you do it that way, you have more control over your brand the quality, the delivery. >> that's the dominos mentality. we want control all the way through the process, this is our product, our people are delivering it and no one else touches the food

other people have grown very quickly with multiple partners. >> interesting to see how that shakes out thank you. still ahead, the u.s military carrying out a series of strikes targeting iranian-backed fighters. plus, one of the most watched matchups goes down to the wire highlights from the niners/seahawks game next on if you listen to the political debate in this country, it sounds like we have a failed society. but nothing could be further from the truth. americans are compassionate and hardworking. we aren't failing. our politicians are failing. that's why i'm running for president. to end the corporate takeover of the government. and give more power to the american people. that's how we'll win healthcare, fair wages, and clean air and water as a right. i'm tom steyer and i approve this message.

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morning's other headlines. nbc's francis riviere with the latest. >> good morning. we start in texas where police are investigating a deadly church shooting just outside of ft. worth. two parishioners and a gunmen are dead a live stream shows the shooter approach someone and then pulls out what appears to be a long gun before opening fire on two people then another church goer pulls out his own gun and shoots back. one of the victims has been identified as anton tony wallace a deken of that church. the jewish community is in mourning it happened during a hanukkah celebration at a rabbi's home in new york a 37-year-old man walked into the house and started stabbing people he has been arrested and since pleaded not guilty new york's governor is calling it an act of domestic terrorism. the u.s. has showed force in

syria. the pentagon says f-15 es targeted weapons and ammunition depoted linked to iran the u.s. is assessing whether there was any casualties on the ground the associated press named serena williams the top female athlete of the decade. she won a dozen grand slam titles and king james reigned as the greatest male athlete. lebron has taken his teams to eight of the last nine nba finals, winning it all twice with the heat and once back home with the cavs. those your headlines. >> thank you i'm suremany will debate the athletes of the decade those sound right to me. the final game of the nfl regular season, that was last night. san francisco 49ers taking on the seattle seahawks with major playoff implications on the line this one it came down to the final play seattle needing a touchdown to

win. russell wilson throws it to jacob who gets stopped literally just inches from the goal line the 49ers hold on to beat the seahawks, 26-21. they not only win their division but they also clinch the top seed in the playoffs i feel like i need to do a clarification, i get asked this if i have any relation to nick bosa, the answer is no afraid i can't do that one. still to come on the show, the countdown to the final trading moments of 2019 are under way this morning we'll break down what markets will have in store for 2020 as "worldwide exchange" rolls on. we're back in two. >> announcer: today's big number 335% that's how much the s&p tech sector is up in the past decade, making it the top performing inx tt rideinhapeod because it's tailored to you! take the personal assessment and get matched with a proven weight loss plan. find out which customized plan can make losing weight easier for you!

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a record run the s&p on pace for its best yearly performance since 2013 economic power house, the u.s. beginning and now ending an entire decade without a recession. we'll debate what's behind the longest expansion in the nation's history. plus, blaming facebook why mark says the world is facing a crisis of trust and the social media giant is to blame you're watching "worldwide exchange" on cnbc. ♪

welcome back and good morning i'm dierdre bosa in for brian sullivan here is how your money and investments is looking through the 5:00 a.m. hour stock futures are looking flat to slightly higher, implied open for the dow industrials. treasury, let's look at what's happening here the ten-year, i believe, 1.916%. let's check now on the asian markets. remember, today was japan's final trading day of 2019. so, if i can make it out there, it ended lower by .8 of 1% but notching gains for the year of about 18%, which is far better than what it saw last year in the red. the hang sang finishing up by one third of 1%. in early european trading markets giving back some of those robust gains the ftse 100 down by about one third of 1%. these markets as well on track

for some robust gains this year. so investors perhaps taking a little bit off the table in the final two days of trading. also making headlines this morning, tesla started deliverying model 3 electric cars built at its shanghai factory. shares of tesla are up nearly 30% this year. a new report on holiday shopping says u.s. consumers will return $100 billion worst of goods during the period from november to january that is up about 5% from a year ago. online purchases, those are the ones said to be about three times more likely to be returned. tom's shoes creditors agreed to take over the company in exchange for restructuring its debt reuters sites a letter sent to employees on friday. toms known for its model of donating a pair of shoes for every pair it sells. credit ratings agency warned the company it was at risk of not being able to repay $300 million

loan due next year now, as we have been talking about this morning, stocks are set to kick off the final trading days of 2019 and the markets look to wrap up what could be its best year in two decades. joining me now is the senior market strategist for slate stone wealth and cnbc contributor. good morning what did you make for the holidays i know you're a good chef. >> well, listen on christmas eve we do the whole seven fishes it's a big italian tradition to serve seven fishes on christmas've and christmas day prime rib or my house it might be lasagna or my wife is puerto rican so it could be roast pork if we felt like it but this year we did lasagna and we did the prime rib. >> that sounds pretty good, kenny. now we have that out of the way, next year everyone seems to be consensus among wall street it

will be pretty good. it won't be a block buster like this what do you see or in an environment when stocks may rise single digits? >> it's a return to normalcy this year you have to look at it, it was way, way out on the scale on the spectrum in terms of 35% returns for the indexes not only this country but when you look around the world. next year in election year, 2020, a lot going on, return to eight or 9% if you throw in dividends, maybe it's 10 or 11% all in is really kind of where we should be it's a return to the historic norm i think people should continue to look at that as a positive. you can't look andgo, oh my god, we're down 20%. you're not down 20%. if you really average it out over five or six years, really where are we in terms of market return it's right in there between 8 and 10%. i'm actually bullish on the market i'm bullish on the u.s. economy.

i'm bullish really on the global economy. i don't nearly think it's as bad as they made it out to be at the beginning of this year look a lot of the stuff that they talked about in 2019 at the beginning of the year with the trade war and what it would do to the global economy and potential u.s. recese u.s. economy continues to chug along and global indexes making new highs certainly in the last month and a half almost daily. >> it's been quite the run kenny, that perfectly leads into the next segment hold tight for just a moment as we were just talking about as we wrap up 2020 and you just said, now another milestone could be be reached. the american economy is set for the first-time ever is u.s. is set to start and end a decade without entering a recession at all. cnbc elizabeth shultzy joins us. great to see you it's been slower growth.

but nevertheless, this decade of expansion. >> that's right. good morning, dierdre. we have seen this is the longest expansion ever in u.s. history totaling 126 months as of this month. one of the themes of this expansion, even though we're in this record decade expansion, we haven't seen it as the strongest expansion. so if you look at overall gdp growth, the cumulative percent increase sings the start of the expansion in 2009, it's been lower compared to previous economic boom. so about 25% increase there in this current run compared to about 41% in the last expansion that lasted nearly this long so, one of the important factors that the economists are looking at that helped to sustain this record run has been that growth has just been slow and steady all along. now, there are a couple reasons for why that's been and one of the main reasons there is that the economy was coming from such a low point at the end of the last decade. so much of this recovery has been spent coming back from the

great recession, deirdra. >> elizabeth, what are economists saying about how long this expansion can continue? what are some of the risk factors? >> they have sited a few things. we couldn't have gone this long without those record low interest rates but of course the record low rates fueled national debt, corporate debt, student loan debt all certainly seeing record high levels there there's a general consensus that just because we have gone so long without a recession doesn't mean we have to have a recession. so there's this expression expansions don't die of old age, but right now the recession probability for next year according to goldman sachs less than 20% political uncertain tirks and overall economic growth globally seem to be the biggest risk factors going forward. >> thank you, elizabeth. kenny, some of the risk

factors for next year. how do you see the next decade shaping up, too, not just the next few years in terms of that recession risk >> well, listen, and elizabeth said it and you said it, we didn't have a recession this last decade partly because of the disaster suffered at the end of the first decade. i think she's right. and with record low rates and negative rates around the world kind of fueled that push back and continues to fuel it back quite honestly which is why i think the market today is where it is because the fed continues to cut rates they're holding steady now but they cut three times this year the ecb cut them and continue to maintain rates low now that being said, i think 2020 is a safe year in terms of not having a recession, but there are geopolitical risks in this country, there are certainly election risks and we'll start to see that more as we get into by super tuesday i would imagine you'll have a much better idea of who is really

rising to the top on the democratic side and what that potential platform is going to look like and then what sectors will be affected as a result that's going to create some uncertainty certainly in the markets and may create uncertainty for the economy. while i'm safe in terms of not thinking we'll get a recession in 2020, no one should be surprised if we ultimately get one in 2021 because it's just part of a normal cycle actually i would argue that the fact that they pushed off a recession over the last decade probably isn't the way the normal cycle should happen but with record low interest rates you could almost guarantee we'll get a recession. >> you mentioned the 2020 election which is a risk factor on many analysts horizon, what are perhaps some of the risks that we may not be talking about as much? i know you talked about record low interest rates how long can that continue what if inflationary pressures start to increase? >> well, i think that's the

argument we have been talking about inflation for a whole decade probably close to 13 years now ultimately at some point if inflation starts to rear its ugly head, the risk really is it going to rear its in such a way that it just explodes higher before anyone really gets an opportunity to control it? i guess that's a big risk. we should talk about that. i think we can talk about that, but that's going to be something that i've been worried about that the inability for the fed to control it because they held it down for so long that when it starts to rear its ugly head isn't going to just spin out of control so quickly that they have to start to raise rates dramatically which is then going to put the brakes on the u.s. economy certainly global economy. >> right kenny, one more that i want to get your take on story close to what i cover in san francisco sales force.com founder and co-ceo mark benioff

is offering a critical take on facebook he puts much of the world's crisis on trust on the tech giant facebook he called facebook the new cigarettes for our society it needs to be regulate ord split up he expected a fundamental reconceptualization of what facebook's role is in the world. now, kenny, all year we have been talking about tech regulation it's coming. it's going to affect the way they operate their businesses, potentially their profits. but we have just seen them climb higher and higher. how do you think regulations are going to play out next year? are we going to see them are lawmakers going to get their act together do you think it will affect some of the stock performances of big tech companies, facebook in particular >> there's a lot of questions there. yes, first of all i'm absolutely in mark's camp he's absolutely right. that the tech has now gotten so out of control places like facebook for sure. look, let's -- let me just say

this, i'm not a facebook user, i never was. i found it difficult to understand what the big gain was. certainly the stock has done well i get it but i think mark is right. it's a crisis of trust and i do think that it does need to be regulated. now the problem is and he made the point, there are a bunch of legislatures and congressmen that my generation or older that don't have a sense or a handle on the role of technology or the depth and the web that technology has around the world, but there is a new class of legislatures starting to come in the generation behind me, the millennials, much more aware of the role of technology and the dangers it places. whether changes in technology come next year or the year after, they should come, it needs to come, the amount of big data is created every single day is mind boggling and people need to be concerned. i do think this is part of the

conversation that what's happening to this data who really has control of it why do they have control of it how much do they know about you or me or the guy next year age what do they do with that data i think it's an absolutely imperative conversation that the country has to have. i do think it needs to be regulated. the industry is not going to regulate itself and that was quite obvious when you saw zuckerberg's testimony in front of congress. no, we're not going to fix it. we're going to let people do what they want that's a slippery slope to go down. >> they may want to regulate it themselves >> i don't think it's going to happen. >> kenny, just two days away, january 1st, when some sweeping new legislation comes into place in california. the california consumer privacy act that will be interesting as you talk about data. kenny, thank you for being with us today >> happy new year. >> happy new year. coming up, investing in the next frontier. the u.s. military connects

science fiction with reality and it could mean a big payoff for investors. that story and more when "worldwide exchange" comes right back ♪

welcome back to "worldwide exchange." let's talk defense stocks. the defense etf is up nearly 30% this year. so what can investors expect in 2020 well, here is morgan brennan with the sector play book. 2019 was defined by more military modernization, more mergers and more tech talk as cloud took center stage and google faced a.i. blowback 2020 will be the years those technologies are adopted and the year the militaries might officially extend to the final pron tear. first, pique defense dollars the 2020 u.s. budget increased defense spending by 3% but don't be surprised if that begins to

flat line. still, international demand will keep growing and the u.s. will keep buying more aircraft, ships and missiles including hypersonics. which will continue to get attention as more prototypes are developed. second, space wars launches. the six military branch goes from science fiction to reality. the air force umbrella, first new service in over 70 years will receive a tiny fraction of the budget with recruitment efforts, headquarters and collaboration with a reenstated space command on the manifest. third, consolidation continues or deal making at least. expect raytheon to sell some assets to get their deal approved speculation will continue about perspective takeover targets >> even just since i put this package together, we have

already seen more deal making actually taking place. laytoss buying privately held d die nettics. so as you mentioned, dierdre, the ita is up nearly 30% for the year the spider aerospace and defense etf is up nearly 40% for the year the expectation going into 2020 especially now that we finally have this new budget signed into law is that we're going to continue to see growth in the stocks in large part because of the p part, the profit part of the p. because you're seeing the order books grow you're seeing the profits grow the cash flow continue to increase as we see more defense spending go to these companies. >> i'm real interested in this relationship between defense and big tech you mentioned in your package there was blow back particularly relating to google's a.i.

initiatives. do you think that that will continue next year does that mean that defense is going to be working with big tech or do you think they'll be snapping up some of the smaller technology companies in this space? >> i think that's going to be one of those big questions, one of those big themes how it plays ou and emerges this year when you speak to folks within the defense industry and also actually within the tech industry increasingly there seems to be this sentiment this google is kind of the outlier, there's an opportunity to work with the defense department and when you're talking about some of these duel-use technologies for a.i., for example, there's been so much focus on the cloud and the d.o.d. is migrating to the cloud you need that cloud to really put some of these a.i. applications to work, there's this expectation there are more and more companies that are willing potentially to work with the defense department, especially smaller and mid-size companies. it's part of the reason the d.o.d. has created this defense innovation unit to basically

reach out and co companies and part of the reason you're seeing contracting reforms as well to do more work with more people or more companies and do more off the shelf tech applications. >> morgan, thank you very much for that certainly one to watch on deck, star wars, the rise of sky walker, heads for the one billion dollar mark. numbers from the weekend box office that's up next ♪ beyond the routine checkups.

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♪ good morning and welcome back you're looking at the tree at rockefeller center time now for the executive recap, the headlines you need in 60 seconds a tweet from president trump that identified the alleged whistleblower was temporarily blocked over the weekend not all of his followers could see the tweet saturday, though

they could yesterday twitter is blaming an outage that resulted in tweets being visible to some but not others. tomorrow is the deadline for pg&e fire victims to submit claims against the company they plan to pay individuals and some government agencies $13.5 billion trust as it exits bankruptcy protection. that plan still must be approved by a judge and state regulators. star wars, the rise of sky walker winning the weekend box office with another $72 million in north american ticket sales the disney movie has now brought in about $362 million in its first ten days on the big screen and when you add in overseas showings the latest star wars movie sold roughly $725 million in tickets, approaching the billion dollar mark. now back to the markets on the second to last trading day of 2019, futures are pointing down to a slightly lower open

patrick, thank you for being here in person so early in the morning. >> of course >> we were talking briefly during the break that you guys were sort of on the high end of estimates, predicting a 9% gain for the s&p next year. where are we going to see that tech has been an outperformer. i spoke about it with kenny despite all the regulations, does that continue next year what sectors are going to be the ones to watch? >> we think 2020 will see a pretty different tone to the market technology is certainly going to be a winner. we think that is going to be the case next year as well but we also expect to see a shift towards more procyclical sec toks by that i mean, industrials, materials, we expect this shift to take place because the industrial data is in the process of bottoming new and likely going to accelerate through the first couple quarters of year so in that environment, investors want to take advantage of that jump in gdp and rotate to those more cyclical sectors.

>> what's going to drive financials >> we expect interest rates to rise with the jump for example, i would focus on the ism manufacturing index. that's an area where we see as it begins to rise the u.s. tenure will rise with it we have seen it since last august where we bottomed around 1.4, 1.5 now it's at 1.9. we expect that to continue through 2020. >> you think interest rates will rise next year >> yes i'm not saying we're going to blow through 2.5 or go to 3, but as industrial data improves, what's going to happen is we're going to see interest rates rise with that. it's going to feel like a better environment and because of that the demand for capital is going to be higher. >> you think markets will take that in stride >> absolutely. interest rates rising is really a signal of economic health. historically we have been told -- when you're low, interest rates rising is a sign

of an economic outlook that looks better in that environment, you want to own risk assets in this case equity specifically. >> do you think the fed raises rates next year? >> i don't believe the fed is in position to raise rates next year i don't think the data will be that vibrant what i do expect, though, is that we are slightly negative this year in industrial activity that is going to improve so i'm not expecting to knock the socks off or that portion of the economy, but that will feel like an improvement and that's going to power the success. >> okay. just spoke about disney, right i don't know if you saw the latest movie, but nearly reaching that billion market how do you see the media space and media and tech space the streaming wars next year >> a lot of those areas are driven by their own success. they have intellectual properties and catalogs really powering those companies earlier in the show we were talking about technology being the winner over the past decade. frankly that's going to continue it's not a function of

evaluations but companies generating their own success they have catalogs that people want to see. they're growing their companies at double digit rates in many cases. that's the baseline expectation for return that is the baseline. >> in term of tech at large, do you not think the cracks are starting to show, it may not be as straight forward for the decade ahead there's regulation on the table. there's concerns about quality on amazon's platform, for example. so does anything worry you in this space >> okay. we can pick some anecdotal examples there may be issues i don't study the companies individually when i take a step back and look at the balance sheets, they remain underlevered, cash remains high, when i look at the growth prospects, they've shown a propensity to continue to generate products which investors are looking for. the table is set for technology to have another great decade i don't see a reason why that couldn't be the case

you look back over the past several years, they delivered on what they promise. md thatch continue to beat time and time again they have shown the ability to do this. >> patrick, thank you so for being with us today. appreciate it. well, that's it for "worldwide exchange" this morning. "squawk box" begins right now. good morning home stretch for the markets s&p within reach of its best annual performance in more than two decades. a milestone for tesla, the company's shanghai plant sup and running after less than a year we'll show you the first model 3 deliveries overnight. and rise of sky walker topped the box office for the second-straight weekend. new numbers on the global haul for the latest star wars offering is straight ahead on this monday, december 30th, 2019 "squawk box" begins right now.

♪ good morning and welcome to a global, global addition of "squawk box. we're always global but today i'm joe kernen i'm along with wilfred frost. anything that happens here or anything that happens there and really if you go east from the uk and around i think we've got you covered. >> i think we do. >> across the pond becky and andrew are off today we've been -- we have been talking all morning. >> basically i've been here for hours, yeah. >> but we have a relationship, and we're going to bring that rapport and that chemistry to viewers. >> this is the first time i have sat at this epic new set. >> oh, it is >> i think we have the best set in business news at stock