it is 5:00 in detroit. your "top five at 5. on the horizon, new comments from the white house and new comments on a covid-19 vaccine and tesla's wild ride but could the rally finally run out of juice. busy in michigan as ford unveils

the latest edition and fans from the 70s will be happy. and a big day for the banks and what we have called the most important stock on the market today. this is "worldwide exchange" on cnbc good morning, good afternoon, goodevening. i'm brian sullivan thank you for starting or ending your tuesday with us the global markets are setting up their day, futures are higher not a lot but they are up. any green is a good sign for investors. especially the speed and severity of the move down the markets around 2:00 p.m. yesterday. around 500 points were erased.

the tech led the flip flop nasdaq ending lower after crossing up for the first time amazon, facebook, adobe, nvidia, et cetera. most are higher right now pre-markets. that reversal likely caused by news by california late in the day that it will roll back part of reopening imposing restrictions on restaurants, movie theaters and bars and students in los angeles and san diego county school districts are unlikely to return to physical classrooms to begin the year this is a big blow to working parents and america's single largest economy. all eyes are on california around the world, europe following our lead lower in early trade but things have stabilized a bit karen tso standing by with some of your top stories.

>> good morning. we have lifted off some of the lows on the session. still a lot of red on the boards a lot of bounces with he saw yesterday from the back of the session. particularly on the french and german session the uk stock market down half a percent. news out today for the gdp numbers and a bounce of 1.8% in that month after a slump of 25%. it is like ease of lockdowns and projections here taking the red across the board. slightly more resilient has been interesting today. key resilience on the future currently capped at 35%. we are taking more measures now. it followed wall street's trade

yesterday. the male kit delivering and others in the market are trading weaker today after updates from ocado and hellofresh it tried to meet all the extra demand for grocery delivery. >> i thought it was called avocado there. i thought what a perfect name. but it was not to be karen, thank you have a good day. back home amid the uptick of hospitalizations and numbers there is some good news for one state dealing with a recent surge. >> good morning, texas reporting the first decline of coronavirus hospitalizations in 15 days as the number of new cases and deaths eased the state said 10,405 people are

hospitalized and being streeted. down five from a day earlier that drop may be small but the overall climb has been slowing for several days drug makers expect to start producing vaccine doses by the end of the summer and early next year the manufacturing process is under way even though they aren't sure which vaccine if any will work. snapchat majority leader says the senate will begin a debate on a fifth coronavirus response bill adding the legislation which has not yet been unveiled will likely be more con ttentious getting to the markets and

your money what happened yesterday? the trading on the dow was going along swimmingly around 2:00 eastern, the selling kicked in. we are joined by jeff killburg good morning was it this headline from california about the resh re shutdowns some saying that was the catalyst do you buy that? >> i think so. it was interesting, the news out of california. los angeles and san diego, the largest districts are now being delayed or put the whole fall on line that could be a template living in chicago, we are concerned. so that type of news really set

up the tape to have a pull back. we had such a tremendous day we did see some is big moves lower. we have recovered here the opening market not too far away we are doing okay and digesting that news. >> is that a sign of things to come the nasdaq, i know you believe it is technically in tact, you've got to be prepared for volatility this is a wild swing type of market we witnessed yesterday. >> no doubt about it let's talk about it with that one/two punch. we did see some selling pressure nowhere near the volatility we saw in march

going to the s&p 500 that was above 3,200. the air is pretty thin above 3,200 to see this move higher, it is okay to see some type of reaction i knew we wouldn't spend much time abovethat sure enough we took the catalyst back >> what is amazing about this market is that it has been all technology financials, the banks, not as important, they haven't done, i think the technical term is squat. the xlf looks bad. many of the banks looking interesting this year. any sign that banks will turn around and do we need them to? >> second worst sector in the s&p 500. this is a big week for earnings.

we get really excited. all of these different names will give us the insight i have seen this as the punt of the decade why? due to the guidance. right now, all of our technical models have sold and we haven't seen them be illuminated yet there for being very, very stingy >> we have the big bank numbers coming out no one will care about the second quarter the earnings doesn't matter. it will be the guidance that matters. probably more specifically, the loan loss writeoff provisions. that will be the number that says will matter the most and you agree what else will you be watching >> i agree i'll add one piece of the puzzle

here you see the trading. when you see the volatility, they have the ability to earn. the trading capabilities could surprise people. they typically come down the middle of the plate. you may see like jp morgan and the like hit it out of the park. a little baseball reference. >> i'm told baseball is coming back in a couple of days what are you going to be watching most closely? technicals tesla what is key? >> how about tesla to see that move that was up nearly 15% i think that emotion is important. keep an eye on the vix again this week. kind of a healing measurement. i think this week, you have to

understand there is a lot of names out there. you talk about some of those gems look at some of those names that will be essential. those names will be around in two years and have the ability to raise prices. will be thoughtful it will be an opportunity earning season in the market >> i love it you are in chicago i love your new look a clean, well-lighted space. jeff, thank you buddy. >> see you soon. when we come back, more reopening rollbacks not just for states and for businesses too. softbank to spin off one of its most high profile tech investments and later, we know tesla matters to tech investments but does it matter to the overallart? mke that's coming up

stick around

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said to have recently received interest china reporting border lockdowns to macau kfc will keep drive-thru operations open in florida and taking similar steps in hot spot areas like california, arizona and texas. back to you. on deck, is your corporate office gone forever or maybe just hibernating? stuck stick around >> announcer: today's big number

$147 billion that's how much trade in value iphone owners are sitting on now. potential to fund iphone purchases over the next three years.

welcome back stock futures are recovering the dow lost about 400 points in a matter of less than an hour when those california reports

crossed about shutting down. schools unlikely to open in the fall in the physical classroom that has been the trend. down one day and three the next day. ending the day lower maybe not the moept important. tesla of course, that stock a wild ride above 1,700 and then it fell. it is up right now 4% to 1,562 per share. let's talk about an update on the jeffery epstein case bad news for the nba, the latest on the nbc is that a rockets red jacket >> in honor of russell westbrook.

new details why they believe maxwel flight risk the day they arrested her, they saw her trying to run from a house and found a cell phone covered in tinfoil maxwell has denied any wrongdoing an exclusive new tell all about the trump family hit the shelf today. lifting a gag order about mary trump called "too much and never enough how my family created the world's most dangerous man." and the rocket's russell westbrook tested positive for covid-19 he tested positive prior to his team's restart in orlando. that restart is scheduled for

thursday, july 30. >> we are excited, by the way, i might know somebody involved with the rockets best of luck to russell and to your jacket. phillip mena, thank you. >> coming up, ho ♪ you should be mad they gave this guy a promotion. w lockheed got tied up in the chinese tensions. and you should be mad at tech that makes things worse. but you're not mad, because you have e*trade, who's tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean.

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. stocks ready to bounce back after giving up big returns. tensions between united states and china flaring up once again. shares of tesla shift into reverse after hitting a new high could that stock finally be running out of juice this is "worldwide exchange" here on cnbc welcome back and good tuesday morning. i'm brian sullivan about 5:25 a.m. in the united states futures are mildly higher but

gaining some speed over the last 30 minutes maybe a good sign for investors across all the major indices that green is positive given the speed of the move down around 2:00 p.m. eastern yesterday. more than 500 points erased in about an hour's time nasdaq ended the day down after surging 11,000 on the upside amazon, facebook, nvidia all hitting new highs. that reversal likely caused by news out of california late in the day that it will roll back reopening imposing new restrictions on theaters and bars and also this, students los angeles and san diego unlikely to return to the classroom in the new year. not just big technology.

there are a number of stocks under the hood that have hit highs as well. names that don't get a lot of attention but maybe should dominos, general mills the companies that help us eat, they put stuff on store shelves and get stuff to us. look at that, hidden gems. not named, the faang stocks. new this morning, deterioration between china and u.s. continue. china to sanction lockheed martin over taiwan arms over disputed claims over chinese resources in the south china sea. eunice has more on this story. >> china said it is putting

sanctions on lockheed martin in response to the u.s.'s latest arm sale to beijing rival, taiwan last week, washington approved the $650 million package to taiwan lockheed is the main contractor for that it is unclear how much of a financial impact this would have on lockheed. it would be unable to sale to the market because of the embargo of the market. estimates are that the business revenue here or the business here accounts for 2% of the revenue. that is mainly through jv shanghai for helicopter parts. saying today, the u.s. needed to stop selling weapons to the island and what they said avoid further harming ties and

instability in the region. that's what they also said about the u.s. on another issue calling the u.s. a trouble maker because the state department overnight had hardened its stance against china's actions in the south china sea, which is a disputed area. the u.s. said those actions the chinese have had are unlawful. brian, china claims the entire territory, pretty much all of it as its own territory neighbors agree that the u.s. has never adhered or went along with china's claims. this latest move does hak it a bit tougher in its description of china's actions >> help us out with geography. i know there are a number of islands in dispute

the primary ones, as i see them. they are really far south. hundreds of miles south of the southern most point of mainland china almost directly across from vietnam or the philippines, are they not >> that's right. there are several more islands you think, what's the big deal the main problem is that this is about freedom of expansion and this will make it harder for other countries to freely navigate in those waters this is a bigger issue than just the island one of the big questions people have is whether or not the trump administration is going to follow through with action that's one big complaint i hear, the trump administration has been having this battle of words

with china the big question is are they going to send out diplomats in this region and follow through with this? >> we call you the crystal ball eun. you look into the future the eun index, how would you describe the return to normalcy from a business perspective? 100% 50%? >> i would say 60% it was starting to get better but then we've had that cluster outbreak since then, there are restrictions in place. beijing has had a number of cases every single day people have been talking about that july 20th might be a day when the restrictions here are removed if we continue to see very few cases in china. still affecting a lot of

businesses here. >> eunice yoon, we appreciate that the recent tension between u.s. and china also come by the way the chinese stock market has been booming the shanghai composite has been breaking an eight-day winning streak the largest eight-day percentage gains since 2008 the front page editorial encouraging investors to foster a quote, healthy bull market as they focus on a complicated trademark et i mention the shanghai, the shenzhen index up 28%. is that a good move or will it end in tears

>> that's the $10 trillion question what you are seeing in china right now in some ways perhaps a refeed of what we saw in 2015. we tend to see these movements often in china what some in the china-watching world call the great china rolling ball that rolls around from property to commodity and stocks and bonds and right now driven in equities they are doing a lot to ensure that sentiment is on the rise and people are willing and able to invest in this bull mark rally you just mentioned >> they wanted the market to really go up all they got to do is make it

easier for guys like us here not in domestic china to buy chinese equities it is impossible to dip in you can buy etfs and stocks. do you think there is any chance to do that >> right now, we are increasingly looking towards the world where tensions continue to rise and make their way to the financial realm. rather than figuring outweighs to make americans grab a larger share of the market, we are looking at the trend that is increasingly difficult to operate successfully on chinese soil >> i'll take it one step further, we've got american military assets that are steaming over to this part of the world. if not there already a naval unit, aircraft carrier

doing exercises. all at the same time, china saying, hey, don't sell missiles to taiwan. it is possible are markets there to care? >> markets aren't factoring a lot of that in right now at the and end of the day, we ae looking and waiting to see where does the president really good from here. a lot of what is happening right now is heavy rhetoric from china and the united states. you are not seeing too much action i think market may also react once they see some kind of reaction and the phase one trade deal that they need to be looking out for.

president trump has been telling the secretary of state and others to calm that down he's focused internally and looking at what is going on in the united states. he's worried about the economy and his reelection campaign. >> we've got to leave it there we are out of time appreciate your in sight stories not going away we'll bring you back soon. coming up, the return of an icon ford pulling the cover off the highly anticipated bronco. look at that thing there is a two-door, a four-door. a bunch of versions. we'll see some bronco views. much like the traditional bronco, could the traditional office be a thing of the past. stick around

welcome back dow futures are bouncing back. that's the macro market. let's get microand look at some of the names you need to watch today. what do you have this round, kate >> shares of mohawk being sued for allegedly fabricating sales

for attempting deliveries to companies that were closed and reporting those attempts as sales. mohawk says it intends to vigorously defend itself delta airline may be able to avoid furloughs this fall. they've received interest of nearly 15,000 employees for early exit plans amazon is rolling out smart shopping carts at the new store in california set to open later this year. the dash carts are embedded with cameras and sensors that track the order. they will avoid checkout lines similar to the features at the amazon go convenience stores >> kate, thank you the continued lockdowns continue across the country that means for many of us, the return to an office is not going

to happen in the near future buildings across america may face a reckoning due to the pandemic they won't simply disappear. joined by vp and director of commercial real estate and commercial mortgage backed research good to have you on. it is a question and everybody always overreacts. you know, we'll never go back. do you think the majority of americans who worked at an office at some point in the next year or two will be back at that office >> i don't think we're in the position to predict when that will happen. what we are focused on and maybe to get good context is that we rate mortgages on commercial

assets so this is a big topic and front of everyone's minds you may think office is dead as you've seen in headlines these days you look at potential of more work from home and the trajectory pre covid you may be seeing major disruption you put your c suite hat on and having to manage the workforce and the cost direct and indirect is that net cost superior to having an office space we think the answer is no. the question is how long that

will take and when that will happen >> you've got $550 billion of mortgage backed securities of mortgage backed office loans out there worth about 1/8th of the entire gdp it is not near-term risk if those aren't renewed, that's an epic hit towards the massive economy. >> absolutely. that happens very gradually. on average, the typical office lease is about nine years. for ones larger than that, they are likely to set the trend. big players there are take on more office space it is like 12 years. it is a small bleed in the respect of leases. you have to build infrastructure

of the work force which, by the way, there is decades long history of those trying to do. these are fundamental issues that don't get solved magically by technology. it takes time and infrastructure to do this. >> i'm glad you bring up yahoo we've tried the work from home thing before i understand there is technology but there are soft costs as well it is harder for younger people to get promoted. you don't have a face time, you are not in the office. you don't get to know your management team. everyone i talked to in the beginning was fear now we are kind of resigned to this situation now everybody i know is changing their mind saying, i need to get

back to the office at some point because i miss my co-workers and i don't feel i can function in my job as well are you hearing the same >> anecdotally, that is a good point. young millennials are the future of office. it is interesting with them. they have a bit of a paradox they are very tech savvy and they want flexible work arrangements but at the same time, they don't get theexposure to management and afforded promotions. they do want the ability to come into a centralized office. that chart that you showed of research, that potential of jobs to be done at home, that is for

triage that is not the ideal situation. that's a different story. >> really interesting report and charts there i've given a speech for five years where i've said the digitalage and human relationships are more, not less i think you mirrored that. have a good day. on tech, tesla shares are up after yesterday's multi-hundred point wild ride. we'll talk more about tesla. the rbi, most random but interesting thing you've hear all day. you'll love this one and breaking down whether tesla's run still has a ways to go wereac45 a bk after this

how does the world reopen for business? to return to the workplace, safely, companies will need the right tools. that's why salesforce created work.com it's an all-new suite of apps, expertise, and services. to manage this crisis today, and thrive tomorrow. everything companies need to return to the workplace. let's reopen. safely.

welcome back time for the rbi, most random but interesting thing you'll hear tesla, an incredible day for the stock yesterday in terms of volatility it was up 250 at one point, hitting 1,795 a share before losing it all. it came down with a 320-point swing. even with yesterday's roller coaster ride, the stock is still up double since -- remember this -- back in may. el elon musk's stock too high in my opinion tweet. the price doubling since he tweeted out his own company's stock price is too high.

i guess not. joining us now with all things tesla and ford, fiphil lebeau. i guess if the ceo doesn't know, what does? >> great point he came out and said he feels like the stock is overvalued and should have a price trading at lower valuation whenever he comes out with these tweets, get these frantic e-mails or phone calls from people asking what do you think? people don't take a whole lot out of those comments. this is what you'll have to have when you make that stock up 2% or down 3% it will have a wild swing and i

wo wouldn't be surprised if we see more of this if they post a popular second quarter, that will mean they've had kwaur quarters in a row before being added to the s&p 500. a lot of people have moved into this stock in anticipation of fund managers and others buying this stock if it's as to the s&p 500. that's the story let me shift gears ford unveiling the new bronco. it is a series three of them that they unveiled last night these will be on sale starting next year with the base model starting just under $30,000. ford is squarely aiming the bronco at the jeep brand jeep has pulled ahead of ford in terms of suv sales

when you talk with people now and you say, are you out in the market for an suv? nine out of 10 times, they'll see jeep it has had the styling down for a number of years. they've blown past ford. there is a lot of neat features on the new bronco. we get to ford one of the interesting things is the website crash. that is an indication of interest in the new bronco >> you know, i will inject myself squarely into this story, which i try not to do. i am a jeep wrangler owner i look at the bronco and the new editions i was looking around the goat mode, pictures with the

doors off. they need to convert folks like me whose jeep is up there with 100,000 miles and 10 years old, i look at the bronco do you think that will get attention? >> whether or not you can win over jeep owners, that is tough. jeep has strong followers. broncos has a strong story bringing back fun stories. features like goat, which is go over any terrain a tall order but not an impossible one >> phil lebeau on tesla and ford watch out for those e-mails.

joining us now, jenny, let's kick things off with what we were talking about not the bronco but tesla does tesla matter for the overall market or is tesla just a tesla story? >> i think tesla for the overall market is the poster child for the irrational skuberance of 2020 phil just said something interesting. people have moved into tesla ahead of fund managers moving into tesla ahead of tesla being put in the s&p 500 that might be a way to trade, that is a rotten way to trade.

not based on someone else doing something based on someone else doing something. it is important for this thought but not foregoi spogoing higher >> a wild stab, tesla is not holding holding your family or future college fund by vesting in tesla. >> i'm a long-holder investor and i would short it not that i have a strong opinion. >> that's why we love you. you would short it if you could. let's talk about the banks wells fargo has lost half its

value. sitting on mortgage deferrals. do you own any of the banks? what are you watching closely with earnings they'll cross this week >> we don't own the big banks? we do own two small regional banks. what i think is interesting is what happened in the market yesterday. the banks that had been negative actually started to pick up steam. i wouldn't be surprised if they started to get a little deserved attention. 30 or 40%, trading at 10 times earns. they are going to be down 65 to 70% year over year that has been positive and not happened in major markets in the past it shows us there is resilience and safety at 10 and 12 times knowing and by the way, as they come up

in the next week, we are looking for actual earnings number add kwasy of capital most importantly, we are looking at what the ceos have to say as that information comes out and people realize that banks aren't dead yet. in 2021, 2022, earnings may be ri ricochetting off of these lows they could be the starts of 21/22. i wouldn't be surprised if what we are seeing is some love and appreciation all we did in 09 was prepare for the next banking crisis.

>> most exciting new investment you've made recently, jenny is what >> okay. the most exciting is national retail properties, which is a triple net three suite i would look at my regional banks. i think the regional banks can be really targeted you can understand what they are doing and as mortgage rates are booming, those regional banks might be benefitting >> always a real pleasure. thank you for watching i'll see you today on the half time report at noon. take care, squawk is up next now is the time to support the places you love. spend 10 dollars or more at a participating small business and get 5 dollars back,

up to 10 times with american express. enroll now at shopsmall.com.

delta airlines all before the opening bell reopening rolled back in california so did the stock market. california shutting down indoor operations of restaurants and other businesses state wide. that announcement adding fuel up from 500 to bearly positive in yesterday's session. we'll talk tesla and one of the biggest victims. it gave up gains to close lower but is still so much higher than it was a couple of months ago. tuesday, july 14, 2020 "squawk box" begins righ