. welcome back, everybody. take a look at the futures the dow, the nasdaq and s&p 500 all set to open at new intraday levels we'll see you tomorrow right now it's time for "squawk on the street. good thursday morning, welcome to "squawk on the street." cramer is in seattle today where later today he'll have an interview with microsoft satya nadella which you will see tonight on "mad money," 6:00 p.m. eastern time. futures solid a day after we close above dow 29k for the first time a trifecta of solid data today europe is trying to get back opening gains and the 10-year is

at 1.08. the unstoppable market as investors digest the details of that china trade deal. stocks ready to open on new records. >> southwest is pulling the boeing 737 max until june. airlines are digging in for more delays. and shares of morgan stanley before the bell. they posted record profit and revenue in 2019. stocks looking to make more history a day after the dow closes above 29k for the first time and the president signs that phase one deal with china the s&p on its way to the seventh weekly gain in eighth. total holiday, ex-auto and gas up 44. names like target might have been an execution issue. >> yeah, i have to say that. i just don't find any other excuse i do think that brian cornell

pretty much said, listen, we screwed up other people, other stores kid better that aggregate number is so much stronger than anything you saw from target. i have to believe they went to walmart, best buy or costco but they sure didn't go to target. >> we're going to get more earnings as we shift from the financials to csx tonight. we'll talk more about the industrial economy but in the meantime morgan stanley, again, reiterating solid performance out of the financials this earnings season. >> luckily i was able to pass wilf on the stairs who was listening to the conference call, follows financials for us. listen, it's about guidance as much as anything else at morgan stanley. they came out with very strong numbers in terms of what their outlook is for this year and that's why you see the stock up, jim, as much as it is right now. we're monitoring the call and will bring you more on it. the numbers themselves good but i think guidance is the key here. >> most of these companies can't even put out guidance. they're really thinking that it

slings arrows at the economy david, this model that gorman has is a model of consistency. i've got to tell you, i'm impressed. he's a -- this is a well oiled machine, so you can put a multiple on it right now, david, why is this company selling at a multiple that is so low versus other companies that are asset gatherers? ten times earnings maybe this is the bargain in the group. >> you mentioned multiples before when it comes to this group overall. they are low they're low for potentially a reason and with rates where they are, low, there's not much expectation when it comes to the big banks in terms of an increase in net interest to income or net interest to margins. but they trade at a low multiple more deserving perhaps there than morgan stanley? >> definitely because we haven't seen what kind of -- the end of january meeting may give us some sense about the line items that thing is not over the map and that's not going to get a high multiple because of that. morgan stanley deserves a high

multiple i'm calling this the dangerfield group. there's no respect it's now reaping the gains the wealth management business is every bit as strong as some of these asset gatherers that we see. i don't know, it's got a blackrock feel to it in some ways with higher multiples i'm very impressed with what gorman is doing but wall street isn't. it's at the same multiples as all the other guys. >> wall street is catching up quickly. at least for goldman price target increases from credit suisse, evercore goes to 2.67 and it brings us to the relationship between the banks and the administration we paid close attention to the signing of that trade deal yesterday and in that signing the president did address specific companies and specific ceos, including jpmorgan take a listen. >> mary erdos, jpmorgan chase.

they just announced earnings and they were incredible where are you? they were very substantial will you say, thank you, mr. president, at least? i made a lot of bankers look very good. >> that was just jpmorgan. let's just play one more out of this before we get to talking about it and that was trump addressing david calhoun at boeing >> david calhoun, he's got a very easy company to run he just took over boeing where's david? david, where's david stand up, david. let me tell you, it's not your fault. you just got there you'll straighten it out quickly, please? okay, i have no doubt. it's a great company >> all right so, jim, the lesson here is at least if you're looking at big public businesses, they have a vested interest in making sure at least that this phase one agreement works. >> look, you can just go and look at the list of people i mean it's the credit card

companies, it's the private equity companies, it's the natural gas companies, it's the tech companies, low end, typically g-rams and pure financials when i was listening to that conference, i was thinking raising numbers jpmorgan, raising numbers blackstone raising numbers carlisle it was really kind of a -- like being in a research department, except for there's a demand to be able to thank someone anyone who watched this was kind of like holy cow this is the private sector cashing in on an amazing deai me recommended list, for heaven ake analysis of the actual language, guys, i mean there's a lot of questions still about whether the chinese are going to be able to follow through on these enormous purchases that they have committed to or seemingly committed to it's going to have to be state mandated which makes it less

likely that it's going to be a market-driven economy over there. and really the key compliance provisions of all the different parts of it that are not about purchases but are about things that are more important to many of the people in that room, namely technology transfers, cyber espionage, state supportive enterprises and all the other things, many of which will be dealt with in phase two if we get there, jim. >> yeah, look, this is not a hold with buy now it's hold with a possible upgrade again, being granular because of the way the president speaks these companies can cash in i guess is what i should say, use more of a conditional. but remember, our tariffs really didn't come down much at all with the expectation that chinese scratch our back, we'll scratch theirs watch the credit card companies, watch visa and mastercard. that's the eedsieasiest for theo turn on. they have been waiting forever it doesn't really hurt other companies in china you got reference to the ceos of

both those companies i think if you want a tell, so to speak, of what this deal really means, you've got to watch visa, you've got to watch mastercard. >> so, jim, the lesson is china is open for business, right? we're no longer in the mode where you've got to pull out, move into mexico, move into vietnam, supply chains are collapsing this is about american companies taking advantage of this enormous market once again >> win by the treasury secretary mnuchin. remember, he wants to engage there are other parts of the white house, including peter navarro who was on our own network this morning, who i think wanting to disengage there are people who are hard-liners who are saying, listen, you can't trust the prc, they'll never change they get protection from the tariffs. then other people are saying, you know what, and this includes lighthizer, these guys are for real and it's time now, i personally come out and say this is a trust and verify situation. president reagan didn't trust the russians but the russians caved. will the chinese cave?

i think they'll cave serially. i know the media -- there was a reuters story yesterday that basically said this is just a complete waste of time i don't think so i don't think it's a waste of time i think that the chinese are saying this guy is a fox, he's a crazy fox. i think he outsmarted them i know, david, you may think that that is not possible to outsmart the chinese, but some of these companies are going to make a lot more money than they were a year ago. >> yeah, but the chinese do play a long game. they do have a government that conceivab conceivably is better setup to ask long-term sacrifice by the population not that it's not important that they continue to put people into the middle class, not that they want to face unrest or that xi does they're set up not that badly. and it becomes still this question of their development of technology they're no longer an also ran. clearly we're superior to them but 5g will certainly be an important test, a.i. will be

another one. there is still a decent chance that you get a decoupling given our competing interests in terms of economics across the globe, particularly as they edge up their economyis still growing. you may say it's growing at a lesser rate, there's no doubt about that, but it's still growing. >> three times our growth. >> yes, thank you. that's about right. >> i think that's the announced number i do not think their economy is as strong. look, if you take a look at that room, david, i'm not there for you to be able to look askance at me -- >> come home soon. i miss doing that to you. >> i'm trying. i miss my wife that's a statement and a half. but micron and qualcomm really the only tech companies there. what does that tell you? david, this may be a win for the bankers. and i think that no one at the beginning was thinking, well, that's going to be the win we thought it was going to be boeing

you had two, not one, but two boeing executives that were there. greg smith, the cfo. if they had planes to make, david, i think they could have crushed it >> yeah. well, right now negative orders as phil lebeau told us a couple of days ago. >> and another setback this morning as southwest -- >> is that like negative yardage? >> yeah, it is. >> southwest announces the extending cancellation of the 737 max flights through june 6, raising doubts once again the plane will return for the important summer travel season it will remove about 330 week day flights from its schedule. this matches what american and united have already done and sort of backs up the mood at least that gary kelly talked to us about when he said he wasn't happy. take a listen to that bite >> i've been very clear, we're not happy about our situation. you know, we put -- we put our future in the hands of boeing and the max, and we're grounded. >> so, jim, you've talked more

about this being a second half story for sure, right? >> oh, yeah. look, delta put up a good number because it's not really maxed. it's not as impacted look, i can tell you that the existing flights will be extremely full you won't be able to put anything in the overhead and you'll be paying more and you'll say where are all these people going and you'll be wait listed. so all the things that can make airlines more money. obviously they want more planes. gary kelly cares about service and knows he can't deliver this is still just -- the black eye continues. calhoun has his work cut out for him. i suggest he comes on "squawk on the street" and really lays out a plan and lays it out sooner rather than later. but you know what today was? today was a day where i did not read a horrible email that had previously been redacted have you noticed there was no email having the faa being idiots or morons is that a win? >> sometimes when you stop hitting yourself on the head

with a hammer, it feels good that's the way some boeing investors might feel today jim, we want to hear a lot more from nadella tonight let's take a look at some of today's movers we'll get to all of that including some calls on tesla, first underweight out of morgan stanley in about seven years more "squawk on the street" from post 9 is back in a minute this is the age of expression.

but shouldn't somebody be listening? so. let's talk. we're built for hearing what's important to you, one to one. edward jones. it's time for investing to feel individual.

let's get to a mad dash. this time we're going cross country to seattle for a mad dash where you're getting ready for that nadella interview we're all looking forward to you had one last night on "mad," xpo, and they have news as well, don't they >> this is so up your alley, david. brad jacobs, who you've known. this is one of the best performing stocks, seventh best since he got involved in the s&p and also tenfold since 2011. he's not happy he feels like the value of his company is ridiculously low. i think what shehe's frustratedy he could be an a.i. logistics company that would get a 25 multiple right now he's got a 20 multiple but it's really not nearly as much as you would get if it just

started over so he wants to sell things i posited that maybe amazon buys the company. that was a nonstarter where i was immediately told why don't you go talk to them, so i said, okay, i will remember, i'm in the city by the sound. >> yeah, you are you are. man, don't think about getting bezos, though, that's my long-term goal you stay away. >> he's over in europe he's over in europe. >> okay. >> you davos hound, though. >> it's not as though the stock hasn't performed fairly well what do you think will actually ending up hag -- happening here with this process. >> i think you'll bring out the value of the business. shopify is a company that gets you the goods. this is a last mile play some ways you could say, you know what, they have the artificial intelligence and the

smart technology to be able to be a shopify with that business and the hard assets, the trucking business. you know what, that's not involved with this and not going to be sold so i look at it as being -- could it be like intelligent from honeywell, zebra technol y technologi technologies it could be a lot of different companies. this is considered to be the google of infrastructure i think brad is right, one division itself is worth the company and then you get the rest for free. >> all right well, the market responding certainly positively today jim, thank you for that mad dash remember, by the way, you can always watch us live on the go on the cnbc app. more "squawk on the street" from the nyc straight ahead legendary terrain in telluride,

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got a lot of data this morning, philly fed, retail sales, jobless claims. all of it uniformly good, and that has futures up. we'll say hello to s&p 3300 at the open as we see dow 29k once again, opening bell in less than ten minutes. hey, saved you a seat.

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you're watching cnbc "squawk on the street. live from the financial capital of the world, the opening bell in just over five minutes on this busy thursday morning as earnings season rolls on our parent company, comcast, getting ready to enter the streaming wars today we'll finding out more about its new video service, peacock, during the company's investor day this is what we know so far. it is scheduled to launch in

april and unlike competing services will be ad supported. they are expecting to spend $2 billion over the next two years on content and marketing they'll join disney plus, apple tv plus, hbomax and quibbe it will be interesting as we try to do things a little differently than some of our rivals have. >> not going straight streaming with just a simple sub free. although we are curious to see what it will cost for ad-free. it's not as central to the overall strategy at the company as disney plus was to disney of course we can all remember back in april that day when they introduced it, the price point being so important, the interview iger gave me we went over a great level of detail and the huge move in the stock price all reflected how important disney plus was to that hbomax very important to the strategy at warner we'll talk a little more about that because craig moffett has a

note about the turner part of warner but poeacock is important. $2 billion in two years. break even by year five. again, we are going to get details today on peacock i could point out charter being downgraded today in the old cable space by morgan stanley where the analyst takes it to equal weight that's been a great performer. still likes comcast a lot. but an important day for nbc universal, our parent, with the introduction of peacock. >> david, comcast is often thought to be the most proficient technologically is there something here that really distinguishes from the other guys that uses technology that could be exciting they do exciting things. >> yeah, i don't know. you know, interface is always important in these things. when i saw the hbomax introduction, their interface was interesting, their recommendation engine, the way

they sort of have that disney plus is fairly strong, so that's important your point, of course, xfinity in terms of all the technology i mean there's thousands of developers at comcast. but we've never licensed, we being comcast, has never licensed it's all the other cable providers, which is something some of the shareholders would have loved to have seen, sort of similar to having it be like google's android for phones. you know, have xfinity be the de facto operating system for all cable distributors that hasn't happened >> i think anyone who has xfinity loves it i think that it's a real additive to the situation. then again if you've never seen xfinity, i don't think you're going to say what is technologically new under the sun. these are just dumb pipes. but in comcast's case, i work for comcast, we all do, it's

exciting and it's easy i'm from philadelphia, an early adopter. >> carl, when it comes to peacock itself and the impact on the financials, we'll see what that is. you know, mike cavanaugh, the cfo, those numbers we're using are from the presentation he gave at the uvs investment conference a few weeks back, late in the year last year we're certainly going to expect to get a little more detail. >> the stock is up since 20% since the announcement of the platform we know even though it launches in april, as jessica said earlier today, it's really the olympics where you'll see a second push. that deal continues to be rocket fuel for just about any initiative that comcast wants to put forward. >> right, in terms of marketing. the key also is subscription expectations we got them from disney on day one, hbomax so it will be interesting to see if they are even offered and what new content potentially will be available solely on the platform right now there's a lot of content there but it's also on

hu hulu calm cast is withdrawing from hulu there's a detail for disney there up for that so a number of questions we hope to get answered >> david, i think you know again, speaking technology in the negative sense, i'm out here and a lot of people think that 5 d5g is an intermediate program. i think why comcast went international is concerned i i think what they're doing at any cable provider makes it so it's less effective. >> well, 5g in terms of its ability to get into the home with a wireless alternative to broadba broadband is still a question we're going to angers aswer and going to be watched by all the cable providers. broadband net ads face tough comps this year, they say. charter, by the way, has been an incredible performer over the

last year, far outpacing the s&p during the last couple of years in terms of its performance. >> people worry about cord cutting and the impact on linear television, but i think it was goldman that once called it the point of indifference for comcast because of the broadband business model there's the opening bell at the s&p 500 at the cnbc realtime exchange at the big board quane x-cel bra celebrating 25 years jim, maybe raise the curtain about the reason you're in seattle and what you expect to ask nadella today. >> look, i think that the company is taking so much share in the cloud that almost everything else takes a back seat a lot of things support their cloud. if you have the regular microsoft operating system, it is so much cheaper to migrate to the cloud that microsoft has,

azure, than it is to go to amazon some people think it's more expensive to go to amazon web services we have to talk about that we also have to talk about the strength of this company during his tenure this is a company that i think a lot of us said, oh, it's going to plod along. it has got a remarkable returning and there is no government intervention here that already happened. that happened 20 years ago this is a behemoth >> it's a big reason why the market, the overall indices are where they are we're at s&p 3300 for the first time, record high. dow 29,166, as you can see record highs all across the board, jim i think it was bespoke yesterday that said the five largest stocks now make up 17% of s&p market cap that is the highest reading

since at least 1990. it actually eclipses the levels that we saw in early 2000. so we are relying heavily on a few select names like microsoft. >> that'sincredible, because remember you had cisco at $400 billion during that peak in 1999 so for it to achieve that period is rather amazing. look, this is a market that is rewarding companies that are international, rewarding companies that have technological proficiency that nobody else has, rewarding companies with multiple streams of revenue like microsoft, like amazon, like alphabet. think about all the things those companies have no wonder there were candidates who wanted to break them up. the sum of the parts are incredible they're all doing amazing things that make it so inflation is so low, so you can have great growth low inflation. that's what these companies do and we don't talk about their impact to the gdp in terms of

inflation and growth nearly enough, but the stock market is rewarding. >> guys, a name we've been following lately given its stratospheric rise, of course, has been tesla nothing but up for the most part since -- well, since the start of the year and well before that it is downgraded this morning by adam jonas over at morgan stanley who went underweight his price target of course goes to 360 because he's so far below where the street is. you can see it's having an impact on the stock a bit today, jim. you know, risks to the long-term chinese business that may not be fully appreciated by the market, he talks about he's got a $332 discounted cash value for the core auto business $28 for mobility his gaap forecast increased 22 for 2025 i mean how can you even have

2030 eps how do you even have -- >> did you google factuous that piece comes up. >> what do you google? sorry, i didn't hear you >> google the word factuous. by the way, in 2030 the eagles are going to win the super bowl and going to win it big. i mean what the heck is this report when i read it, i said this is a buy, buy, buy report i am jimmy chill now so that's hard to say. >> look, his bull case was 500 stock has gotten there he does say investors will be presented with more attractive opportunities to own the stock in the future. he hopes the china numbers is encouraged by execution in china. >> well, i mean if i were -- remember the old view on musk? he would smoke a doobie and make fun of this guy.

now we have a definitive henry ford meets edison. i think that he's a statesman because otherwise he'd take this fellow apart that doesn't happen anymore. some of us miss the old non-chile lon musk he would be rolling over wherever he is right now this was ill-advised research. >> yeah. well, maybe musk is just doing those horrible dance moves, right? you remember last week's dance. >> why how say horrible? >> they were horrible. it was horrible. nobody wants to watch that. >> oh, please. you are a defeatist and a negativist. >> really? a defeatist and a negativist >> i thought he danced well for his age. okay, so he's not fred astaire what are you looking for >> i'm looking for a little rhythm, my friend, just a little bit. a little bit >> hey, david, for a trilli

trillionaire, he does pretty well >> i think bezos is a better dancer than musk >> you're just trying to land bezos, that's all you're doing. >> come back from europe, i'm ready for you, jeff, wherever you are. i don't know about nadella's dance moves, jim maybe you can sample those later. that's horrible dancing, i'm sorry. >> look, if he's wearing a black t-shirt, he is game. he is not a slave to convention like you >> that's true, i am a slave to convention, a defeatist and a negativist speaking of negative, at&t this morning gets a long report, jim, from moffett nathanson they're focused on turner, which is a part of warner media, contributes over 50% of the company's ebid, the warner part of at&t. it's not having an impact at all on the stock price their concern, continued ratings

declines, viewership declines at turner, tbs and tnt and what that's going to mean for the renewal cycle that the company is in the midst of in renewing with the cable providers what i can tell you is those concerns may be a bit misplaced based on conversations i've had. a lot of those deals have already been done, the renewal deals. they're not for five to seven years any longer now they're closer to three to five years don't know the terms but the concern about them all coming up this year, that may be a bit misplaced from what i hear many of the big guys have already been done. there is no doubt that as we know, back to peacock of course and the other streaming efforts, the universe of cable subscribers continues to decline and will continue to decline that is having an impact we also know that the programming featured on tnt and tbs, we all love it. i'll never stop watching "the fugitive" or a couple of those

other movies because whenever you're flipping. but they're going up against the likes of all the new entertainment product available on all of the streaming services the ratings are down cnn, by the way, has been quite strong but perhaps a little bit much here made of that, given that they apparently have had successful renewals already. >> you know what, david, that sounds like -- who is the other -- the bull case singer elliott? the elliott guys are going to win. >> i don't know about that this is still worthy of a great deal of focus and will be during the course of this year as to whether they can meet those targets for revenue growth at the company and what pressure it's going to continue to be under as a result of subscriber defections at directv, the pressure that we see in the cable universe, hbomax's launch

which will take place in april, how well it's going to do in terms of getting traction. all of these things make at&t an important watch. not to mention as well the wireless business which of course continues to be an important part of the company, at least roughly half overall. so, jim, we'll see there are those who still believe eventually they're going to have to throw in the towel, divest their directv, figure out something new for warner who knows. but that's not going on right now. >> david, elliott partners is usually a $60 price target when i listen to you, this is a tentative situation and it's actually a situation that's on the fly. i think it's interesting that you just mentioned the wireless as an afterthought so what happens, stevenson buys at&t he buys something that great american jeff sells him and it doesn't get him the cash flow he thought it would >> it gives a decent amount of

cash flow. the question is whether it will increase that cash flow and all the revenues it's a pressured business on some fronts, turner being an example of that. hbo. the question, again, will hbomax really gain significant traction at its price point the service is a robust one. i remember being there there's a lot on there, will be when it's available. but will it go far beyond the current hbo customer these are key questions. and then the wireless business listen, back to t-mo and sprint, we'll see what happens there if that deal doesn't happen, is it better for at&t wireless? if it does happen, is it better for at&t wireless? 5g there's a lot swirling around here the guys at elliott are smart guys, but i've seen a lot of smart guys as you have, jim, end up being wrong. >> talk about a stock that's not participating in the great american rally i mean holy cow, this one isn't. at&t was considered to be a very

safe stock when we felt there would never be a china deal. now all of a sudden what we're thinking is this is dead money and we'd rather be in aggressive stocks that are going to prenup if there is a deal to be enforced the stock is uniquely wrong for this market. 100% -- there's some south america. but there are not many companies where estimates have come down except for target. >> yeah, that's true carl, of course, what is working keeps working, which is facebook now up over 8% this year apple is having a very strong morning, returning to its more than 7% gain so far this year. and alphabet i mean those three names alone, the market cap that's been added during just the first ten or so trading days of the year. >> just what we were saying a moment ago, about the market leaning on the giants.

jim, i want to get you on rails because csx is tonight biggest drop since the recession since december rail traffic last week down 9.6, no good. the rails are testing all-time highs today. why? >> precision railroading this is one of those situations where they're getting, let's just say, more per car csx is heir to this whole process. i've got to tell you, i think people will look at the efficiency rating. if efficiency is good, they're going to take it up. don't forget, union pacific a huge beneficiary of anything that goes on just because of commerce that goes west to southern california ports that then goes to china this group is -- it's on fire and it's on fire because of what people think will happen in the future, not people thinking about what's happened in the past. >> we'll see what happens. there's been some research the last week that suggests they're going to squeeze another beat out of the quarter on

restructuring, maybe some cost cutting, but how long can that hold up before fundamentals return and then, jim, utilities i mean we talk about tech and alphabet and all of the giants rising, but at the same time utilities also hitting new highs. is this a hedge or just a signal of a global rate environment that remains low what's happening there >> this is astonishing i'm glad you brought it up carl, if you thought the economy worldwide was going to grow because of a trade deal, why would the utilities be rallying? why would oil fall oil, i think -- i think this rally in the utilities is a search for yield wherever you can finding it i'rin western power. it really is at the whim of customers. 2.8% yield, but this stock is really on fire when you look at the chart of aep, doesn't that look like

alphabet doesn't that look like microsoft? isn't it amazing >> it truly is just a signal that investors are buying just about everything vix dips below 12 here at the open the dow is up 160. obviously 3300 for the first time on the s&p. let's get to bob pisani. >> s&p 3300, dow 29,000, we're firing on all cylinders. a number of breakouts occurring. let's take a look at the sectors right now. tech of course breaking out, consumer discretionary strong. banks having a better day. they have been selling off going into earnings. morgan stanley with terrific numbers. consumer staples and the vanguard read strong as well retail up, semi conductors up, emerging markets up, also up for the day. there's a number of things we're talking about catching up with technology. here's the nasdaq 100 up 4% for the year, but the ipo etf right near historic highs. home construction is

outperforming. china stocks have been doing well ever since the beginning of the year aerospace has been an outperformer so it's not just tech out there, there are a lot of other things that are performing not even in line but even better banks better on the morgan stanley numbers but kbe selling off going into earnings. this is a very typical phenomenon but we had very particular things happen this week in the earnings overall a little disappointment with wells fargo. small disappointments with u.s. bank corp. you see down for the week here pnc was in line. morgan stanley way above expectations citi hit a new high yesterday. so you see mixed results for earnings today, morgan stanley big beat on the top line and the bottom line here look at that, that's 7% on the upside big move for morgan stanley. charles schwab slightly below expectations but they're giving them a break because there's a lot of discussions about that upcoming deal with ameritrade. on that they did have the press release this morning they didn't have a press call

but they had a press release assets, this whole ameritrade deal is about assets under management and synergies big, big asset gatherer, charles schwab up 24% year over year last year. of course on the ameritrade deal, they said they are aiming to close in the second half of the 2020 obviously this is under review right now. there may be some small age antitrust issues remember, this is not about trades, this is about synergies and it's about gathering assets. the new combined entity would have more than $5 trillion in assets combined and it's also about synergies. you're going to close a lot of sectors there that are going to be redundant and they are talking about very significant cost synergies overall what else is going on here look, this is all about the banks. 60% of their revenues are from the bank net interest income. so when the yield curve changes, it really matters a lot to a

company like schwab. they also have a very big asset management division. of course they have a very big etf division they have funds that are out there and make money on that, 30%. there you've got 94% in that here's trading this is what zero commissions eventually will do to you. you're down to essentially 3% and others about 3%. i expect you're going to see a lot more consolidation this year in a lot of these other businesses, particularly the etf business carpa carl, there's 150 etf companies, but the top five have 90% of all the assets five companies, 90% of the etf assets back to you, carl. >> incredible, bob, thanks let's get to the bond pits and rick santelli. hey, rick. >> absolutely, carl. as i get various emails, you know there's a lot of picking going on on the data you know the control number for retail sales up a half a percent was solid. yeah, we lost a little bit on a revision but the point is, do you average it together or is this a

building momentum scenario, and there is a difference. the data was good. look at an intraday of 10, immediate response in the marketplace. it popped. 10s are up three basis points, 2s are up two and this changes the direction on the one-week chart. we also had a close yesterday, it was the lowest in 10s since december 4th as you see on that chart. the ongoing discussion is as follows. if the signing of the trade deal and all the associated market factors that led up to it are the reason thattic wi iequitiese doing so well, why is it exactly they're not having a similar effect on pushing rates higher it's something that we will be thinking of in the santelli exchange discussing later today. finally, the dollar index. when we go back to november, you can learn a lot. the november index is down a bit yesterday, it's coming back today, but it certainly looks as though it may have peaked. you see those lower highs

successively you want to pay very close attention to right around 97.30 to 97.50 in the dollar index carl, jim, david, back to you. >> all right, rick, thank you. be sure to check out our podcast. you can listen to the opening bell hour of "squawk on the street" wherever you get podcasts record highs across the board. s&p 3,303. we're back in a minute we're carvana, the company who invented

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let's get to jim and stock trading. >> yes, one of the things that happened for most of the quart he so far is analysts had to catch up the stocks. if you look at the stock of amd you have a commentator from barclays, 32 to 50 price target. what are you going to do the stock is overrun dramatically produced about a, i don't know, there is a return since she started. it's amazing

data center this time is growing. a lot of people still didn't understand how intel couldn't produce its chips. this is what is driving the market stocks that have exceeded price targets where the analysts are playing catch up >> that's for sure, jim. we all know what's coming up tonight. >> yeah. look, satya nadella is going to address an ambitious new plan to address climate change we'll be there when it is announced. it's monumental because this is where the future is and we also have gw pharma, a company that makes artificial cannabis and that company is on fire. they've put out a really good quarterly on sunday night. >> all right, jim. >> sustainability. one of the themes of the week without a doubt. >> oh, my. david, e.s.g okay those are the letters you need to know. >> jim, we'll see you at 6:00 if not before our jim cramer making his way around the country in seattle

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good thursday morning. welcome back to "squawk on the street." i'm carl quintanilla we're live on the new york stock exchange record highs across the board and more data crossing the tape. let's get back to santelli >> absolutely. our november read on business inventories as expected though not strong minus 0.2 expected minus 0.2 is what we received. last month 0.2 shaved to 0.1 now for the housing market index we look to our housing expert. what do you think? well, i don't hear diana it is 75 75 is our january read it's a little bit stronger than we expected.

sequentially it follows 76 carl and the gang, back to you >> rick santelli, thank you. it's the broken record rally new highs across the board today after the signing of the phase one china trade agreement but are there still economic uncertainties surrounding the deal >> plus, more delays for boeing with southwest now joining the mix of airlines pulling the max until june >> we're still focused on the financials today morgan stanley shares were up strongly on an earnings beat and strong outlook >> let's get to the record gains this morning as we said, all across the board as we have touched s&p 3300 for the first time joining us the chief strategist as well as the chief investment strategist at northwestern mutual wealth management company. good to see you. what do you make of the action what is inexpensive now if anything >> so we have very expensive markets here but this is a liquidity driven rally, which means it can go on for a while and the u.s. has not seen the

full impact of those three rate cuts last year because it takes about 12 months. so we're pretty positive on the year having said that, there are going to be some hiccups along the year not least of which is the election and not least of which is our new trade deal, which contains within it the seeds of some uncertainty going down the road. >> if you're looking for an intrayear drop, if so, how much? >> we think there could be an intrayear drop about 10% a typical year is about 14%. so that wouldn't be unusual. having said that when you have such a huge year like you had last year up almost 30% including dividends, then you usually have a very positive year following we had a fiscal boost and monetary boost last year that's working into this year's earnings >> what do you think of the levels >> i agree in large part you had three head winds to the markets for the past year and a half they were one, the fed, which was tightening as your prior guest mentioned. now they're easing so that

should begin filtering through the system there is no chance in my estimation given the election the back and forth between the fed and the president that they actually hike in 2020. you had the trade war which i think the president has what he needs to take the electorate right now and i think he'll dampen it given it is election year number three, investors unfortunately over the past year and a half have been building cash up. i think now as those recession fears ebb that is fuel for the fire of the market to go higher and as long as bond yields remain i think the stock market moves higher >> you just mentioned, alicia, uncertainties around trade what are they? >> the really interesting thing about this trade deal are the purchases, the 200 billion in incremental purchases. that is not really free trade, right? that is sort of managed economy. but it's so much of a higher boost than we had last year or even the level of 2017 it's going to be very hard for china to achieve those levels. and now the u.s. has a mechanism

by which it can dispute it with china. if there is no satisfaction they can raise tariffs again. we actually encoded the ability in law to raise tariffs again. i just think it is going to be very hard to achieve the 200 billion and that level >> i imagine some of the commodity purchases for example are going to come from maybe sales we would have made to our other trading partners to go to china which you would imagine potentially could bid up prices? >> that's right. it's not entirely additive to the levels we already have, although it is a win it is definitely a win >> but i think when you take that and couple that with, say, wage pressures and we're hearing the idea of margin compression due to how low unemployment is in this country you have to wonder what that means for the economy and the potential for it to run hot that's what the fed does >> that is one of our smaller risks for this year so we think there is a chance inflation raises its head in the next 12 to 18 months it sounds like a crazy thing to say. it's a small risk. but the fed has said they're going to sit on their hands and

let the economy run and run hot and they want it even if you see a 2.5% inflation rate, even if you see it, the fed could sit. that sets us up. we have a tight labor market we have labor force participation rate which is good the primary age is good. think about where we're going here and firms can't find workers that's what small businesses tell us. they can't find workers. we're set up if all goes well, doesn't mean it will, but if all goes well we're set up to see some sort of rise in inflation here >> you got copper today, brent, at the highest since may i know it is a little arcane but you have to go back three years to see prices like that with palladium. what is to say produce, protein, eventually labor is not far behind >> that is a risk. so inflation, with all this talk about deflation and lack of inflation, the measures of inflation, they have actually been rising over the past year

not falling. and so while market expectations and market indicators have come down, there is a disconnect there that may have to be rectified somewhat later in the year but i think as alicia mentioned the most important thing i can tell you and the most important thing i've been saying the past three to four years is the fed doesn't care inny more the fed has completely shifted from being what it was, an inflation fighter, a cycle ender, a discipline market participant to now being one where they are an inflation enhancer, a cycle enhancer, and they actually don't want the market to go down. they listen to the market. the fed's economic outlook will be met this year and rather than hiking twice they lowered rates twice three times. so this is a big shift from the fed we've seen over the past year >> that would make sense unless dallas -- caplan for example now talking more overtly to the risk to the rise in the balance sheet. that it's not free, right? that there is a danger of creating imbalances. if that view gets spread across

the committee, who knows >> that's right. we've learned central banks are really good at inflating asset prices it turns out they are not so good at raising inflation. this could be the mechanism by which we get some inflation. look, there is a risk here if all of the rally and all of the sentiment is due to increase on the balance sheet, what are these central banks supposed to do i don't know how we get out of this, you know, smarter heads than i need to figure this out but, you know, this is central the fed is in the market action. you can't separate the two >> as much as some people try. good stuff thank you. >> thank you >> let's get back out for today's housing data >> reporter: i can hear you this time, morgan home builder sentiment in january dropped one point to 75 on the national association of home builders index. and last month a 20-year high. that is still pretty good.

anything above 50 is considered positive last january sentiment was at 58 this is a big jump builders cited strong demand, low mortgage rates, and very low supply of existing homes for sale of the hmi's three components, buyer traffic increased one point to 58, the highest level since december of 2017 current sales conditions, however, fell three points to 81 and sales expectations in the next six months was unchanged at 79 now, one more piece of data we got this morning mortgage applications to purchase a newly built home jumped nearly 39% annually in december that's a strong end to the year, which seems to predict strong sales to start 2020. david? >> thank you meantime, southwest is joining other airlines in extending the cancellation of 737 max flights. phil lebeau is back at our headquarters with a lot more on that continuing story. >> we expected southwest to do this at some point especially with american joining united by pushing the max back to early

june so here is the new launch date if you will for when southwest plans to once again start flying the 737 max. june 7th you see both american and united down with june 4th because it is moving back the max return by almost two months southwest is going to be canceling almost 18,000 flights that were on the schedule. that means the total number of scheduled flights by u.s. carriers that have been scrapped because they don't have the max now totals more than 170,000 flights. that's all -- the big concern, guys, is whether or not southwest along with american and united will have a second straight summer flying season without the 737 max. remember, the summer time, that's the busy time for the airlines it's the most profitable time of the year for them. to not have the max a second straight summer would be a devastating blow for them.

is it going to kill them completely no but this is certainly not what they were expecting. certainly not a second summer without the max. >> okay. so, phil, given the fact that boeing has struck some deals, some compensation deals with airlines like southwest, we don't know the numbers, the fact that you're continuing to see these extensions in 2020 are they going to have to go back and make more of them? >> yes yes. we haven't seen the end of these deals, morgan. most of these deals were structured to take care of flights that were lost in 2019 but they were not structured for the most part to take care of flights lost in 2020 because it's open ended. will we have the max back certified by april, by may nobody is quite sure as a result, these deals are basically open ended at this point in terms of what happens in 2020. look for boeing at some point perhaps in two weeks when they report earnings to take an additional charge or to say we expect to take an additional charge because of compensation for airlines >> all right that would be the second quarter in a row we're having to x out

some big charges thank you. still to come, morgan stanley shares are up big after the beat this morning. we'll dig through some of the numbers. impressive action in wealth management as bank earnings season essentially comes to a close. as a reminder you can always watch us live on the go on the cnbc app down load it today uokts ckn mont ♪ ♪ hey frank, our worker's comp insurance is expiring, should we just renew it? yeah, sure. hey there, small business owner. pie insurance here with some sweet advice to stop you from overpaying on

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welcome back to "squawk on the street." it is time now for ecf spotlight taking a look at the financial sector ticker slf erasing losses for the month and currently trading up about 0.5% today. morgan stanley is today's biggest gainer on the s&p 500 thanks to the better than expected quarterly results that stock currently trading up almost 6.5%. we have a breakdown of the company numbers. >> good morning, guys. morgan stanley soaring as morgan just said. a very strong q4 albeit a bit lumpy led to about 2% of the gains we've seen premarket but it is the new guidance and targets that have really driven shares higher up 6.5%. q4 revenue was 10.9 billion, about a billion ahead of estimates and eps of 130 was

about 30 cents ahead a strong quarter in all segments with particular stand points being fixed income trading about 3 million ahead of guidance and very strong investment management revenue of $1.4 billion, some 600 million ahead of expectation which came thanks to a one off from the asia pe funds benefiting from a successful q4 hong kong ipo of an earlier investment they'd made the guidance is what really impressed. return on tangible commonality 13.4% in q4. new 2021 guide of 13% to 15% and long-term target of 15% to 17% wealth management which now accounts for over 40% of revenues had a 27% margin in q4. gets a new target margin of 28% to 30% for 2021. long term of over 30%. the chairman and ceo was optimistic on the call about growing the wealth and investment management platforms. >> i think the growth in

long-term net flows which reflect strong performance with combined revenues of approximately 21 billion at wealth and investment management businesses are among the largest platforms in the world and now we have an untapped opportunity to further scale our wealth management channel tlau our workplace offering >> today's share price move means morgan stanley jumps ahead of goldman sachs in terms of 2020 share price performance but the two pure play investor banks are well ahead of the pack in terms of starts to the year. the kbw banks index in fact negative yields today and wells fargo the lods so far. >> will we expect these long-term targets? i'm curious why now in light of the fact we're getting goldman's investor day >> they do their annual target review always in this quarter's earnings so we expect targets just not as strong i think they were broadly impressive but wealth management is really interesting because of the scale they're starting to

deliver there. we know it is a scale business across all forms of investment management two things one was the question mark of whether looking backwards q4 margins would be under pressure because of the consolidation we've seen in the brokers. absolutely not q4 beat as well at 27% and is there a question whether it would going forward and the answer to that is no also the optimism he talked about, about growing now what they have, the corporate offering sort of the fidelities and black rocks of this world. they give you an account and then afterwards when you sell them what do you do with that? that was very optimistic in terms of integrating the acquisiti acquisition and clearly the market really likes this they had been cheap like goldman sachs by the back end of last year but both investment banks having a good start to the year. >> both trading 10 multiple. depends on your view whether that is cheap or not but certainly today it looks like -- >> price to book 1.1, 1.2 for the two of them. morgan stanley putting 6% of premium again themselves over

goldman today. but that's cheap for both of them it's cheap relative to the money centers. shows that there is still ground to catch up. everyone was saying oh, look citi is still cheap. i think they fit into the category as well >> thank you as you're talking here the president with a tweet regarding phase one. the farmers are really happy with the new china trade deal and the soon to be signed deal with mexico and canada but i hope the thing they will most remember is the fact i was able to take massive incoming tariff money and use it to help them get through the tough times. sort of runs afoul of what we've heard from some groups like farmers for free trade who said this deal makes american farmers increasingly reliant on chinese state controlled purchases, so by no means uniform response among the ag community to this deal so far. >> yeah, given what we've seen play out with weather as well that was a big issue in terms of the planting cycle and the harvest cycle this past year and the past couple years that affected farm income, too.

that is going to be another key thing to watch in terms of trying to ramp up supplies to actually meet some of the quotas in terms of exports to china, too. >> okay. there is a look again at what we just heard from the president regarding farmers. an important bloc obviously as well of voters >> yes >> for the upcoming election, particularly in some of those key states, although those states tend to lean toward his party. >> states like iowa. >> yes iowa where we're going to have a caucus in the not too distant future after the break, is beyond meat over cooked we'll debate ♪ ♪

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by consolidating your credit card debt into one monthly payment. including your interest rate right by locking in a fixed low rate today. and you can get your money right with sofi. check your rate in two minutes or less. get a no-fee personal loan up to $100k. welcome back a volatile week for beyond meat the company halted earlier this week when the stock spiked as much as 15% and then dipped as much as #l% on a downgrade from bernstein's. still, stock has been on a tear to say the least for 2020 up more than 40% since the start of the year joining us now to discuss the

stock's wild ride wells fargo analyst john baumgartner thanks for being with us today >> thank you >> want to get your thoughts on the move we've seen. you have a hold rating and price target of 72 stocks trading above a hundred right now. why are you not buying into this rally? >> well, a couple reasons. there was news out over the past week with beyond meat's rival saying they're not going to pursue the mcdonald's business right now. we saw expansion of the test market of mcdonald's and beyond in canada and most recently beyond came out and noted they are looking to enter china by the end of the year. there's been some good news flow, short covered in the stock as well but we are still concerned over the structural combination in this category >> you just touched on it but given the fact this is, has been a heavily shorted name how much is this a short squeeze? >> a fair amount i think what is more important is looking at the flow it's really retail driven. we haven't seen the big institutional buyers coming in so it is a retail driven stock

>> meantime you have this expansion of the plant, lettuce, tomato sandwich with mcdonald's. how meaningful could that be >> we estimate every 1% share of that red meat market at mcdonald's taken by beyond is worth about $50 million of annual sales compared to about $270 million forecasting for net sales for beyond this year so it is large but we would mention, too, just given the novelty of the product, we have seen test markets, tim horton's in canada. it seems the product is doing better in urban areas so the geo graphic appeal is still very well unknown at this point >> in terms of the supply picture, any reason to think that as a company like beyond meat continues to ramp up that that could come under pressure again? >> i mean, we think so you've seen some other companies out there, tyson, already entering this market private label also getting big we also think going forward what is not known yet you think about the manufacturing side right now this industry is in technology back from the 1970s

we're seeing new technologies emerging to produce better quality meat at lower cost on the ingredient side three crops comprise 60% of calorieic intake there are tens of thousands of edible plants on the planet and i think we'll see new crops emerge with a better nutritional profile than what is on the market now >> you mentioned impossible which is privately held but one of the largest competitors here and the expansion internationally for that company be it in china i know they're also looking to get regulatory approval in the eu what does the international picture look like for beyond >> you know, we see them moving into europe at this point already. china is obviously in the cards for later this year according to the company. it could be a sizable opportunity over time. however, they can only grow as fast as underlying supply can grow and right now there are still bottlenecking in the system >> thank you for joining us today. >> thank you >> shares of beyond up another 2% today some new numbers to share

involving the private company wework this morning, remember much in the news the latter part of last year of course the company only signed four new leases in the u.s. during that fourth quarter, a 93% drop from the prior year average. the pullback did reflect a down sizing of the business of course after soft bank took control in october with that large financing package. new management, ceos, the coceos stepping out a lot at wework still to come. after what was of course a key year in terms of its inability to get to those public markets it is a business in transition i guess to try to be generous. >> yeah, absolutely. it also looks like based on cnbc report that wework exceeded the top spot of flexible leasing space to spaces owned by regis' parent iwg and certainly the name that has been out there and

has been publicly traded and seen as the most direct comparable to wework which was i think part of what triggered so much of the skepticism when we did start to get those filings the other thing to keep an eye on -- >> that was a picture outside court yesterday just so we know why we're running that video sorry. >> the other thing that got my attention today in terms of ra wework is the kkr report that's warning that it could continue to be a drag on some of these unprofitable, big unicorns looking to raise funding even now into a new calendar year >> i think that is a key question mark. i've heard a number of different names, companies that might have been looking for a raise, that they haven't been able to get. will they consider a sale instead? and so, yeah it has made it more difficult. no doubt in terms of at least some of those questionable business models that continue to hemorrhage money >> we'll watch that obviously. dow is up 160 here this morning. let's get a news update from sue herera back at hq. >> hello, everybody.

here's what's happening at this hour ukrainian police say they've opened an investigation into the possibility that the u.s. ambassador came under illegal surveillance by an unknown party before she was recalled from her post in may. this comes two days after house democrats released documents that showed lev parnas communicating about the removal of marie yovanovitch as ambassador to ukraine. russian lawmakers quickly approving the appointment of a new prime minister a day after president putin reshuffled his inner circle in a move that could keep him in power past his term in 2024 the chief of russia's tax service addressing russian lawmakers before the crucial vote at least four members of a yazidi militia linked to the card stan workers party reported to have been killed by an air strike in northwest iraq on wednesday. the victims were inside a pickup truck parked in a yazidi compound

prince harry helping unveil the fixtures for the 2021 rugby league world cup in his first public engagement since stepping away as a senior royal he also met rugby players and representatives of the 21 nations during that event. you are up to date that's the news update this hour morgan, i'll send it back downtown to you. >> i am not a royal watcher but i just can't get enough of the story going on right now >> you have a lot of company everybody is talking about it. >> sue herera, thank you after the break did china get the better end of the trade deal?

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stocks hit more record highs the day after the signing of the u.s./china phase one trade agreement but there are still economic uncertainties surrounding that deal. steve liesman has that for us. good morning, steve. >> good morning, carl. it ranges from guarded optimism

to outright skepticism here is the good and the bad most tariffs remain in place and that is a problem. there was some reduction most of the tariffs remain in place. china is upping purchase of u.s. goods. some question how to account for that confidence and capex could rebound which has been hit by the trade war. tariffs can be reimposed there is upside for free and fair trade over time including the importance of dispute resolution in the new agreement. td securities now writes downside risks for u.s. growth have faded helped by the phase one trade deal we don't expect anxiety about trade however to suddenly disappear. oxford has a similar take. they write with tariffs still imposed on two-thirds of u.s. imports from china we believe the phase one deal will only marginally reduce the drag on real gdp growth in 2020 from 0.2 points to 0.1 point. still, elevated policy uncertainty will keep businesses on the sidelines until further clarity emerges. now in a statement the treasury

secretary steve mnuchin acknowledged the continuation of tariffs but had a different take on the impact. i quote. the president got very significant wins for u.s. business, u.s. workers, and u.s. farmers. we still have significant tariffs in place as an incentive to get phase two done. so the gdp story in 2020 is one of continued narrowing effects of the tariffs from last year working their way through the economy against the potential upside of the phase one deal and who knows, carl? at some point maybe a broader, more significant phase two deal. >> all right steve, thanks for covering so much ground on this front for the past 24 hours at the very least. our next guest has an op-ed in the times today titled "trump gets his trade deal, china gets the win. our guests join us this morning. guys, good to see you both good morning >> good morning. >> good morning. >> why do you think china wins round one? >> what china has given us isn't that much actually it is going to buy more stuff from the u.s. and they would

have bought it from other markets anyway so just a matter of a small diversion the amount is not going toe very large or affect the u.s. bilateral trade deficit with china but some of the changes that the trump administration got from china such as better intellectual property rights protection regime is going to be good for china in the long run they want to be an innovation led economy and they need a better intellectual property rights protection regime so it's good for china whether they will enforce it in a way that does not once again advantage domestic firms remains to be seen that is where china has been very clever at using its previous commitments to favor its own companies. certainly an agreement to not leverage currency actually works for china. they don't want their currency to depreciate too much and have capital flowing out. so making that guarantee public actually gives them currency stability which they're happy about. >> tony, maybe the president is right and this should have been

done 20 years ago and in the meantime they've stolen enough to a degree where they can start to be self-re liant. >> look, that is an excellent point on some of the structural reforms. they are in china's interests and should have been doing them a long time ago. and i think a couple successive administrations have been trying to convince them of that when i look at some of the elements of this agreement i think those kinds of reforms are basically good the continued talking is basically good we'll move on to more things you know, winners and losers, i don't know it was worth all of this effort to get to where we are but i do like the direction. the things that really concern me, though, are some of the sort of directives on the currency, for example. and on the sort of forced purchases of these products. what we really want is for china to be more of a market economy and the administration is putting in structures to, you know, encourage them to be more of a managed economy that's not really where we'll go for the long term but i hope, you know, i want to be

optimistic about future discussions in this. >> i wonder what you think about financial services aspect of this deal. i mean, some of the stipulations that were laid out in detail yesterday honestly go back to when china entered the wto some of the same types of promises we see going back 25 years that have yet to be fulfilled. why would now be different >> as mr. fratto correctly pointed out this is not to be discounted it is good that american and other financial services, insurers, banking firms and so on can enter the chinese market which is a very large, growing market and certainly could use foreign competition. but the interesting thing is that china is fulfilling a commitment as you said that it made a very long time ago. now at a time that suits it. because at this point, chinese financial firms, chinese insurers can stand on their own and compete with foreign firms and now the foreign competition is actually going to serve a very useful purpose in terms of pushing forward financial market

reforms, in terms of creating better competition in china. so again, china comes out a winner, not that the u.s. is going to come out a loser, but china has done this reform at a time that suits it on its own terms. >> i'm curious now that we can look back at least now that we have a trade deal here, trans pacific partnership very much unclear it ever would have passed congress but of course the trump administration withdrew from it immediately do you think that would have been a better deal to contain china and sort of help the u.s. than the trade deal we have right now? >> certainly a much better effect in terms of helping the u.s. the concern right now is that with china creating a lot of bilateral and multi lateral deals where it gets to be the key partner that can dictate the terms of those deals, with the u.s. backing off from the wto, which is something that most other countries still want to

keep viable, china has a bigger role so the u.s. through its actions has basically given itself less influence in terms of this multi lateral process. it may have gotten some small wins from china but in terms of the broader picture the u.s. withdrawal from the global trading system or at least the notion of that is not helping the u.s. cause >> tony, i wonder what you think phase two negotiations could potentially look like or entail especially given the fact that one of the other big pieces of trade news this week was the u.s., the eu, and japan coming out and basically looking for reforms around state subsidies in the wto >> i would have loved to have seen those discussions start two years ago, to his point about whether it is ttp or other ways to link arms with allies to present a more unified front with china you know, it would have been better to start that earlier, but i'm glad they're starting it now and that the other major

trading partners, europe and japan, are starting those discussions. i hope that that is what we see in phase two and that we come around to that way of thinking. early in the trump administration there was this rejection of economic dialogue with china economic dialogue is now back on the table with china they'll restart those talks. there was a rejection of multi lateralism now we're looking at other multi lateral solutions to try to present a united front those are good things we need to see more of. >> and one final question to tony's point about strategic focus. are we back in the dialogue era, back in the china is open for business and endless opportunity with a billion people or are we still in the, their supply chain must be broken, we're going to distance ourselves, digital cold war, huawei and all of that? the two sides are operating simultaneously >> it's good we have a phase one deal it means a little less

uncertainty, a little less escalation of tensions, but the fundamental uncertainties that affect american importers, that affect american businesses who are thinking about selling into the chinese market, using china as part of their supply chains, all of those uncertainties remain on the table and china gets to make the big changes on its own terms. so phase two is going to be a very difficult issue china isn't going to be happy about trying to change the structure of its economy so i think the fundamental uncertainty is going to remain and china is going to continue with its broader set of policies this phase one deal won't have much of an effect on that. >> on a day where the vice premier tells the chinese press it would be unwise to rush into phase two talks. we'll see you guys soon. thanks >> thanks, guys. >> thank you during yesterday's signing ceremony for the trade deal the president singling out a number of company ceos that were in attendance at the white house including this moment with the ceo of ebay.

>> scott shankel ebay. i sign things and the next night i see them on ebay they're sold they're sold for a lot of money. i said, sir, would you sign my sneaker? yes. then two nights later i see it on ebay selling for $5,000 i say, what kind of people are these, lindsay terrible sometimes it's the senators and the congressmen that do it >> the president is surfing ebay at night checking on things that he signed and seeing how they're doing? implying the congressmen i thought it was funny where he turned right to lindsey graham this is terrible why is this happening? >> yeah. he took aim with comments at quite a number of ceos and other business leaders in the room as well definitely raising some eyebrows >> i think he is still the interim ceo at ebay having taken over when the previous ceo left the company. i'm sure they're happy to know

they got some traffic in the white house. >> all right well, meantime getting market flash on canadian jet maker bombardier and more back at hq >> i do not spend a lot of time on ebay at night, for the record we want to call your attention to bombardier the shares down in the canadian trading session right now, the worst daily decline on record here after the company issued a profit warning and said it may have to significantly write down the value of its partnership with airbus on the a220 model jet this comes amid a broader restructuring, focusing more on its jets units but morgan something you may appreciate challenging rail products in the uk, switzerland, and germany helping to contribute to that decline. i'll send things back over to you. >> yes, key data to watch there. that is a big move for that stock. >> subway cars, too. >> yeah. dom, thank you as we head to break, take a look at shares of signet, parent

of its sales, soaring 40% on strong holiday sales a lot online also raising the q4 guidance

let's get to the cme group in chicago the santelli exchange hey, rick. >> good morning, carl. i'd like to welcome the even flow managing partner and founder. thanks for joining me today. let's get right into it. >> okay. >> if we look at what's going on with regard to the markets, many believe that one of the big issues keeping stocks moving higher and kevlar coated with respect to any big corrections is the recent spat of non-qe which of course is qe with all the fed buying of mostly short maturities which of course was followed by rate cuts and a much higher bar to raise rates due to

inflation. your thoughts? >> yeah. well, absolutely i think the fed is one of three things so it gets its share of the credit but it is not the whole thing. whether the fed likes it or not, m 1 growth stocks the -- tracks the stock market the fed going into qe is a positive force in the right direction. when we think about the market relative to september we've also gotten a trade piece and we've gotten a decreased probability of an elizabeth warren or outlier candidate. those three things go into the stock market then the fourth thing that is really important is we took a whole foreign policy risk off the table with iran where we tested early on in the year what their threshold was and how far they were willing to push the war and we know that they blinked. that also helps the stock market >> you know, when you look under all of the issues you just brought up under the microscope of politics because everything is so political as we get close to the election a lot of those

become negatives whether foreign policy, even the trade deal we just had many discussions where the trade deal isn't that great of a deal. all i know is i can't believe the u.s. is any worse off in the final analysis, maybe one of the big issues that gets lost here is how well stocks are positioned as we now move into a better potential capital spending chapter global year final thoughts >> absolutely. the trade deal, we bought ourselves piece for ten months we put enormous pressure on china. they are going to act better we'll get some gains out of it on stopping technology theft and other things that take a while to get in. and the capital cycle is set to improve. i think the economy is at full deployment and is pretty stable and that's a good place to be right now. >> i got you thank you for joining me today david faber, back to you >> okay. rick, thank you.

good to see mark now over for a look at what's coming up on "squawk alley." >> well, huawei, now that phase one of the trade deal is in the books, what happens with the federal government's treatment of that company? it matters to suppliers. we'll explore it coming up on "squawk alley." ♪

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welcome back to "squawk on the street." i'm dominic chu. new records for the dow, the s&p 500, and nasdaq in today's session. every single s&p 500 stock is tried r trading in positive territory and stocks near their highs of the day one underperformer is the material sector. albemarle, dragging. you can see that sea of red in the midst of a sea of e grogree. ppg falling after missing

estimates. iwill send things back to you, guys, david faber at the new york stock exchange. >> the race for the white house is heating up. one of the democratic front-runners has been raking in large donations from wall street and silicon valley robert frank has the story >> good morning, dave. bernie sanders won the money race in the fourth quarter with $34 million compared to biden's $23 million, but biden is way ahead when it comes to big bundlers the biden campaign releasing its list of over 200 bundlers, who have raised more than $25,000 so far. they includen wall street, silicon valley and these are who make up the list from hollywood, you've got jeffrey katzenberg, harry sloan. in politics, he's got erskine

boes, choformer chief of staff r under clinton and california senator dianne feinstein last month, biden gained two of the pillars of the democratic money machine. they had been supporting kamala harris, who dropped out last month. biden and buttigieg are the only candidates who have released the names of their bundlers. the buttigieg saying it inadvertently left out over 20 names from their list. president trump broke tradition in 2016 by refusing to disclose his list of bundlers he is once again declining to do so in the current campaign biden saying that his fund-raisers with bundlers and big donors have been open to the media and are, quote, completely transparent. you've got the polling race going into iowa and of course in

parallel, the money race in two different sort of approaches to this with sanders and warren taking a grassroots small-donation people. >> i guess the individual contribution limit is, what -- >> -- 2,800. >> so they'll get together a bunch of their friends, people who feel obligated to give that number for some dinner that's the key of bundling i guess. even if those people they're calling on don't necessarily support the candidate, they feel obligated to show up oftentimes. >> that's right. remember with the growth of supermax, you have that $2,800 limit toward a donation toward a single candidate but a lot of people who go to those dinners can support a superpac with unlimited amounts of money

this is a small piece of what will be huge amounts of money pouring into this election >> we've had a number of obama administration cabinet members endorse biden, penny fritzkerr i believe just yesterday where is president obama in all of this? >> he has suggested he's going to wait until we have a candidate, until that person is nominated by the party to be the democratic candidate so i suspect until that is official, he'll be on the sidelines, but once it is, whether it's biden, sanders, warren, buttigieg, that obama will hit the trail hard because that's what he did in the last election as well >> it will be fascinating especially when you throw in bloomberg and his -- >> absolutely. unlimited amount of money. >> that's right. although still meeting with some tech officials >> yep >> we're currently at 29,200 s&p, 3,305 we are a few points from the s&p with a five fold increase from

the haynes bottom of 666, that crisis low, five times the gain. coming up on "squawk alley," comcast and nbcu unveiling it new streaming service, peacock 'lta about what that means for streaming wars hey, saved you a seat.

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