in 2016 at this point, only about a half a million people had voted, and now the voting continues. and now you know the news for this monday, october the 12th, 2020 i'm shepard smith at cnbc global headquarters hope you'll be back with us here tomorrow for another edition of "the news. it is 5:00 a.m. at cnbc global headquarters and here is your five at 5:00. technology stocks coming off their best day in a month. a streaming strategy shakeup over at disney that has the stock surging and one activist investor saying job well done. trouble at johnson & johnson with human trials of its covid-19 vaccine, details coming up next. plus all aboard the spac train as one high profile investment firm gets in on that big trend

and xmtchristmas in october as amazon kicks off its two day prime day today, the investment play and if any other retailers have what it takes to compete with amazon, it is tuesday, october 13, 2020 you are watching cnbc right here on cnbc. ♪ let it go, let it go how you're one with the wind and sky ♪ >> everyone's kid knows that song good morning, i'm dominic chu in for brian sullivan you can see the dow is implied lower by just about 17 points, so we'll call it fairly stage and flat nasdaq higher by about 77, the technology trend continues the nasdaq has been leading on the up side and down side over the course of the last couple months the major averages all coming off yet another winning session, the dow rising more than 250

points for its first four day winning streak since early september. the major outperformer again was that nasdaq, surging more than 2.5% for its best day since september 9. you can see there just over the last two days here, a massive move higher, 2.5% gains there to close out yesterday. leading the charge, apple. the biggest company in the s&p soaring more than 6% on the day for its best single session since july 31 when the stock closed up 10.5% after a blowout earnings report. all of this is happening ahead of apple's big product launch 1:00 p.m. eastern time today a slew of 5g capable iphones are likely among other you new technology to be released. and outside of technology, keeping an eye on the small caps, continuing to tick higher after a 4% gain last week, that was its second week in a row with a gain of more than 4%.

and according to instinstanet, y the fourth time over the last 30 years. small caps have been possibly a barometer of what could happen in the future. around the world though, a mixed session overnight in asia, hong kong suspending trading there due to a typhoon warning and european trade, mostly red arrows and let's go to geoff cutmore live out there with the latest there. good morning, geoff. >> hey, good morning let's show you the big board u.s. equities are broadly lower, it is banks and travel stocks that are lead being the declines yet gasolin yet again. tighter restrictions are once again hurting the travel and leisure sector with the uk creating a three tier alert system and some warning that the measures may not be enough and in france, the death rate

has increased despite the number of infections slowing. shares in roche are moving higher expecting their antigen tests available by the end of the year, they can provide tests in 18 minutes and the process can feed through up to 300 tests per hour so that would be an important breakthrough here. roche slipping negative on the trade this hour. let me send it back to you >> geoff, thank you very much. softbank's spac play, disney's streaming shakeup and major headwind in the race for a covid-19 vaccine all topping your headlines this tuesday morning. for all of those story, we send it over to leslie picker >> good morning, dom a busy news morning. johnson & johnson announcing that it is pausing the phase three trial of its coronavirus

vaccine due to an unexplained illness in a study participant the coach. first reported notes that the study is not under a clinical hold and that it is not immediately apparent whether the volunteer received the actual treatment or a placebo j & j says this is an expected part of clinical studies and this is the second time a major trial has been paused in recent weeks over safety concerns j & j is also set to release quarterly results tho s this mog and the company's cfo will join "squawk box. and disney in order to further accelerate its direct to consumer strategy, they will be centralizing its media business into a single organization that will be responsible for content distribution and sales and disney plus. the news is just days after an

investor called for a halt to the company's dividend and better focus on streaming efforts. in a statement to cnbc last night, loeb says he is pleased to see disney is focused on the same opportunity that makes us enthusiastic shareholders. now, disney shares up pretty significantly this morning, 4.4% there. and softbank is planning to launch a blank check acquisition company, or a spac in the coming weeks according to senior softbank executive, speaking at the 2020 milliken institute global conference, he said it will give the vision fund a new way of invests in private companies and allow public investors access to solve the softbank if you don't have a spac right now, i don't know what you are doing. >> i'm not sure what it is a sign of though

>> that's the big question >> a blank check company and go buy whatever you want, not sure what that tells us >> especially if you are a company like softbank that has hundreds of billions in dry powder why not just go raise more >> why not all right, leslie, thank you very much. back to the broader markets and as if investors didn't have enough to chew on already, get it, chew on, yes, i said it, earnings season kicks in this week jpmorgan and citi results out before the opening bell as questions remain about the lasting impact of the coronavirus outbreak on companies' bottom lines. for more, i'm joined by founder and financial adviser and new street advisers. thank you so much for joining us how important are those earnings and specifically the bank ones in setting the tone for this particular earnings season

>> thank you for having me i think the bank earnings are obviously important specifically the broader market earnings are very important we're looking for how companies are handling what we're going through, how they are handling their strategy with the pandemic that we're seeing. analysts actually revive earnings expectations up this quarter during the quarter, last quarter we saw analysts had a pretty low bar for a lot of the companies. and so we're seeing if companies can reach the bar that was revised upwards for earnings expectations a lot of companies as we mentioned, guidance outlook is taken out if a lot of companies. but maybe they give us a peek for what they are thinking for the strategy going forward disney has said that they will focus on the correct direct to r so i want to see how they are handling the new normal. when you talk about the bank earnings, the fed has said that we'll have lower rates for a while, how will that play into the banks, what will they do as

far as raising revenue in other wa ways >> in your mind, what are the most important companies, the most important industry groups that will kind of give you an idea about whether or not the american economy and the american markets can be on track going into 2021? >> i think obviously you want to see what the epicenter stocks do, what the s companies do, but looking at zoom, amazon, how those companies have faired. if that trend is continuing, and investors are noticing that we're going further into this high tech and away from the epicenter and into the pandemic stocks, that is a big thing to look for so looking at e commerce and see if that trend is holding also different things when it comes to the epicenter stocks and if they are rebounding going

forward. >> and those epicenter stocks have been powering the market rally, just a stone's throw away with record highs giveagain. do you care about what happens in this election >> that's a great question it shows who is in the office or what size of the office. doesn't really play in how the market fairs obviously the economy has to be doing well so big thing that the market is looking for is that second a mount of stimulus, investors want that stability for themselves and the market. and that also will provide as we saw with the car.a.r.eare.a.r.e, people feel more comfortable with this time and i think they went to equities after they have the basic things taken care of and so this is really important

catalyst as we see going forward, that next round of stimulus >> delano, thank you very much appreciate it. and when we come back, tesla cutting the price of another one of its vehicles in china, those details coming up next and plus there may be 73 shopping days left until christmas, yes, we're already counting down, but amazon is hoping you don't wait. we'll talk prime days and what is at stake for the entire retail world because of amazon's big shopping day and disney shares are rising this morning as the dow component announces a major reorganization of its businesses as a single mother,

my first job is to care for derek. everything i do is for him. when i moved to this apartment after six months, we need to connect with the world. i use the internet to keep him in the language, because that's the way to connect to my family's traditions. he has to know where he comes from. we need internet essentials. there's no excuse to not get connected.

welcome back to "worldwide exchange." let's check on stocks on the move shares of ethan allen are soaring up 14%, it says it expects to swing to a first quarter profit and report sales above analyst estimates. the company citing growth from its design centers and e-commerce business. it is important to note that ethan allen's market cap is about $500 million, but still a big move there for a smaller cap company. william sonoma though raising its dividend and resuming its share buyback program citing the ongoing strength of its position

and liquidity provision. those are ones to watch. and tesla is cutting the starting price on the model s in china by 3%, that is according to the company's website the move comes as china reports sales of new energy vehicles rose 68% last month. tesla rose 2% in trading yesterday after the s&p raised the company's debt ratings two notches from investment grade citing in part tesla's third quarter deliveries and the ramp up in production of its model y. still on deck for the show, apple gearing up for its big event later on today likely unveiling its latest iphone models. we are breaking down what to expect from that new device and what it all means for the tech giant's stock, coming up today's big number $16 trillion that is how much the coronavirus pandemic will cost americans

according to a study by former treasury seblgcretary larry sumr and economist larry kudlow that is equal to about 90% of the annual gross domestic product of the u.s what if you could have the perspective to see more? at morgan stanley, a global collective of thought leaders offers investors a broader view. ♪ we see companies protecting the bottom line by putting people first. we see a bright future, still hungry for the ingenuity of those ready for the next challenge. today, we are translating decades of experience into strategies for the road ahead. we are morgan stanley.

welcome back let's get a check on futures as you see, some stable market, but the markets might snap a multiday winning streak, s&p

implied higher by 4, dow lower by just 11 and nasdaq implied up by about 1 05 points. 105 points ♪ you can go your own way

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switch and save up to $400 a year on your wireless bill. with the carrier rated #1 in customer satisfaction. call, click, or visit your local xfinity store today. futures pointing to a mixed open and shares of apple also in the spotlight as it is holding what

is dubbed its most signature iphone events in years a preview before is it 5g. and disney unswraliveiling a ma reorganization as the entertainment company puts a bigger bet on what else, streaming. it is tuesday, october 13, you're watching "worldwide exchange" here on cnbc ♪ >> welcome back to the show. i'm dominic chu. here is how stock futures are looking. major averages are coming off yet another winning session, the dow jumping more than 250 points for its first four day winning streak since early september but the major outperformer as it has been for quite some time now has been the nasdaq. surging more than 2.5% as you see here, its best day since

september 9. leading the charge, what else, apple soaring more than 6% on the day for its best single session since july 31. by the way on that day the stock closed up 10.5% because of a blowout earnings report. shares you can see solidly higher i would note though that apple has been underperforming since its hit its record highs earlier this year. the stellar day comes ahead of the company's very highly anticipated h anticipated hardware unveil event today. and argen, is it going to be 5g and how important is it for apple? >> well, that is certainly the focus here the event is tag lined high speed, and analysts are expecting four new iphones to be unveiled an iphone mini, iphone 12, 12

pro and 12 pro max which will boast a 6.7 inch screen, apple's largest yet. and if we look at some of the leaks we've seen over the past few weeks, it suggests that there will be a slight redesign as to the look and this is certainly apple's largest range of iphones so far if also you include the se 2 that was released earlier this year perhaps recognition that it needs to play across various price points, not just the high end segment. and 5g, we're expecting at least some of the models to be 5 xwrchg enabl enabled. and this is causing excitement from analysts even as some of the networks particularly in the u.s. are still in their early stages morgan stanley analyst calling this the most significant iphone event in years and arguably it is the last time we've seen such a revamp to the iphone line was back in 2014 with the iphone 6

range, that was the first time apple introduces its largest screen iphone and that spurred a massive upgrade cycle. what analysts at the time described as a super cycle and certainly hoping to repeat some of that success again with the iphone 12. >> and i mean, there are a lot of questions out there, first one i have is whether or not the u.s. cellular network right now, the infrastructure built, can even handle the new technology that apple is expected to put out here i remember last year, the year before, there were debates between the biggest telecom companies in america about what constituted 5g and who actually had it so are we ready for 5g in these smartphones? >> that is certainly a big issue. i thinks answer is no at the moment 5g is not -- all 5g is not created equal. there are certain bands of 5g. and what we've seen so far is a lot of the u.s. carriers focusing on the low to mid band spectrum and that means that that will get you some speed slightly

faster than 4 g, but not necessarily the blistering spee speeds 5g promises only one carrier is besting on that high band and even that is only in certain cities as well so it is patchy at best across the u.s., varying degrees connectivity and i think that will be a big challenge for apple. because they will really have to explain to the consumer why they need to upgrade to 5g phones given the fact that they might not get the speeds, they will have to show them real world use cases that they can do in 5g that they couldn't in 4g if you look being outside of the u.s., 5g has been expanding very quickly. in q2, one in three smartphones sold was a 5g smartphone of course china a very critical market for apple as well so when they are looking at these new iphone ranges, 5g will be important in other markets

which are rolling out 5g at a very faster pace >> everyone feeling the need for speed. and amazon will be kicking off prime day today three months later than usual as it delayed the now two day shopping event from july because of, what else, the coronavirus pandemic consumers may be willing to spend even as the economy remains relatively weaker. a recent survey by retail me not finds about two-thirds of americans say they plan to shop on prime day, more than either black friday or cyber monday that is why some analysts predict prime day will serve as the unofficial kickoff to the holiday shopping season. and rivals such as walmart, target and best buy are also offering deals this week possibly in response to prime day. let's get more insight from dana

telsey how important is prime day for the american shopper >> exactly what you said is right. i think it is the kickoff to the black friday and holiday season. when you have over 150 million shoppers shopping amazon prime day, that is big and that is why walmart, target, best buy, coal jcpenney positios giving sales we're looking for prime day sales this year to be up 40% to 50% and while it generated $7.2 billion last year, we are looking to $10 billion to $11 billion this year, of which just over $7 billion should come from the u.s. so it is big and it is the unofficial kickoff to this upcoming holiday season. >> dana, i'm on the amazon website right now, kind of scouring around. and there is so much stuff out there, i don't know what to shop for. what exactly is going to be the

biggest driver of sales on prime day for amazon, what types of goods? >> some of the kf of the goods electro electronics to fashion to hard goods. i think people will be looking for deals on big ticket categories whether best buy is doing their not yet black friday, target doing their deal base, walmart doing their big save, amazon is promoting a lot of their own brands and they are also promoting small businesses too >> i'm curious how healthy the american consumer is in your mind, how much are they going to be taking advantage of this particular event here, and of course what happens with walmart and target and best buy and others who are responding in kind to this is this going to be a robust shopping season because there is so much focus online >> i think that it will be a really bifurcated season i think that you will see home and electronics and active do

really well. i think apparel will be weak when you think about the overall season, but also given it is starting now you, it is an extended season will we be having a 75 day season instead of what you normally would have which is over 50 days. so it seems like it is extended. and what the surprise could be, will it be up even just a little bit because of the fact that, yes, it is more online and when people do go to store, they will be making a bigger ticket purchase fewer trips, but higher con investigation when they do go to the stores >> and so you are seeing the types of performancesconinvestig to the stores. >> and so you are seeing the types of performances, what can we expect to see going into 2021 about the companies that will outperform and underperform, are there certain places that investors want to be and where they want to stay away from. >> i think what will be interesting as we head into 2021, i think that some of the

apparel manufacture brands will be really interesting. because they are controlling their own destiny with direct to consumer so that can be companies to a levi and pvh i think the off-pricers will have opportunities in 2021 given that they were closed for a good chunk of 2020. that is tjx, ross stores and burlington and i think that you will continue to see the discounters really move, whether it is walmart or target. i think that they will work. and let's not forget the nesting phenomenon is real home is working. and you've seen companies like rh continue to do well as well as william sonoma that i think will work in 2021. i think some of the down and outers are the apparel manufacturers that bennett benefit in 2021 that didn't in 2020 >> dana telsey, thank you very much >> thank you and another story we're following closely this morning is disney announcing a massive

media restructuring after the close yesterday with a renewed focus on streaming video leslie picker is back with more on that. >> shares of disney are up more than 4% in the pre-market on news the company ikocompany is restructuring to boost disney plus and other streaming services they will centralize into a single organization that will be responsible for content distribution, ad sales and streaming services disney plus, espn plus and hulu. and also promoting kareem daniel to now oversee the new media and entertainment distribution group. in an interview with yjulia boorstin, the ceo said even without the pandemic, this shift was going to happen one way or another. >> i would not characterize its a response to covid.

i might say that covid accelerated the rate at which we made this transition, but this transition was going to happen anyway because essentially with what we want to do is separate out the folks who make our wonderful content based on tremendous franchises in the decision making in terms of where the prioritization is in terms of how it gets xherl s l commercialized into the market plus >> netflix has 193 million user, but it has taken 13 years to build that customer base dom, i hate to admit it, but i a. a subscriber of pretty much everything >> i am too. i've made this point so many times before, i might as well bundle it because i have so many of these things together i'm kind of curious though, the moves that we're talking about

and bob chapek mentioned by can i see any come just days after dan loeb called on the company to stop its dividend and take that moneycan see any come just days after dan loeb called on the company to stop its dividend and take that money and use to fund its streaming company business how is the timing. >> how often do you see an investor to suspend a dividend, usually they are calling for more cash in the hands of shareholders but this does seem to be satisfying third point for now loeb's firm said we're pleased to see that disney is focused on the same opportunity that makes us, the firm, such enthusiastic shareholders investing heavily in the dtc business positioning disney to thrive in the next era of entertainment third point is one of disney's largest shareholders and boosted its position earlier this year >> leslie picker with the latest on disney, thank you very much back to the broader markets,

the nasdaq is leading the charge something our next guest says could be part of a larger trend. joining us now is kerry firestone, often featured on "fast money" and of course the." take us through the setup here are you opt poliimistic about t future of the markets given the fact that we're so close to record highs >> hi dom, thanks for having me. the market had a very sharp day yesterday and it reminded us of the end of august. and remember, we had a month of september down 3.8% where the nasdaq underperformed and stocks like apple, amazon, facebook really took a hit after months of leading the charge. what i think we saw yesterday was a return to the nasdaq and the type of names that sort of

brought us here because the market wants a stimulus, the market seemed to expect yesterday that there was going to be positive news from washington either this administration or the next administration and that we were going to get that because gdp and consumer spending really needs that boost from the government to propel it forward. and it felt that the market was saying we're going to get it that, that will help gdp deep agreeing after the high fuss mie second quarter, so we have to keep it going for the market to move higher. and if it is going to move higher, it is hard to see that technology stocks cannot be a big part of that process >> the path of least resistance arguably has been to just fall back on mega cap technology. it has been the prevailing theme for markets over the better part of the last decade since the great financial crisis

but there was so much talk about this rotation that somehow underperforming value was going to kind of broaden things out and it was going to help lead the next leg higher and get this market a little bit more broad based. it is not really happening though, or is it >> well, it is a very good question and if you look at the numbers, here is what you'll see. year to date, through yesterday, 38% of the 500ish names, not quite 500, in the s&p 500, only 38% were ahead of the market for the year but if you looked at from september 1 to the present, the number is double that. more than double it is 77% of stocks have outperformed the s&p meaning it is abroadened market it has broadened so it is not just technology stocks we have added industrials and some health care very few financials. but more consumer names.

it is not just the big five or the big ten. you've really had to see more names participate for this market to move higher in a sustainable fashion. and that has happened over the last month and a half. we'll see if it will continue. it can't happen without the technology stocks participating. that is the point i'm trying to make it is very hard for the market to move into new high territory without seeing apple, amazon, facebook, you know, google, those names, part of it, because they still represent the growth engine of this company's economy. >> so that is easy i consider those easy picks. right? what exactly are you as a portfolio manager putting on your shopping list that is not faang? >> the stocks that we've been buying in the last few weeks, when the nasdaq slid, were names like paypal, serum

they really did take a hit in september. we butt boston scientific. they had very little business when hospitals were closed for discretionary surgery. it started again waze connection is a name we've added, remax which is the real estate broke raj official and blackstone on the financial side we've been adding those over the last couple weeks and we think there is quite a long runway there as well. >> and before we let you go, it is a huge day for amazon and apple, but also a big week for the financials those banks have underperformed for so long. is there anything that we can see out of these big bank earnings reports this week and next that get you fired up about the financials >> oh, gosh. the poor financials. if you were to look at the perfect storm to hurt them, you would have very low interest rates, a recession, a pandemic

and problems with real estate and the leases that they have to deal with. so i think that we have to listen to whether they have had many defaults, how they are seeing their part follortfolio,t they are doing with loan loss. interest rates are moving a little bit higher, so it would be nice for them to get something sustained above 0 ppts 0.7% we don't own any of the big bank, but we're listening to them because they point to what the economy will look like >> all right, thank you very much and coming up on the show, another hurdle in the race by drug makers to find a covid vaccine. we're talking with an industry analyst about the names that you will you will need to watch. but first, some of your other top stories this morning the ongoing pandemic has fueled

a surge in pc sales. that is according to preliminary data from gartner group. more than 71 million pcs were shipped worldwide in the third quarter, that is a 3.6% jump from a year ago with the u.s. seeing the strongest sales growth in a decade a group of the world's largest investors with investments totaling $5 trillion is setting tougher carbon emissions targets for their portfolios, the group is aiming to recuduce emissions by as muc as 29% over the next half decade and china is expressioni iexpreg opposition to the trump administration's plans to sell arms to taiwan, including sales of a truck mounted rocket ceo r er and surfa tai missiles

welcome back we continue to follow that developing story and news surrounding johnson & johnson pausing its covid-19 vaccine study participant had an unexplained illness. for more on the drug and the race by makers to get a vaccine, i'm joined by a senior biopharma

analyst. i guess the big news is joon johnson & johnson. how much should we be worried, does it derail the whole program? >> i don't think that it necessarily derails the entire program. we didn't really have enough details as to what is happening with the j & j product i think that it is important to understand from my initial understanding is that this was one safety finding in one patient, so it may or may not be related to the actual safety of the vaccine. what is important is that the vaccines from pfizer, hoe der that and even astrazeneca are still going on world wide which gives hope >> and as you take a look at your coverage ub verse for all of these covid-related either vaccine trials or antibody trials, is there a company that stands out as one that you think is well positioned if we do see some positivity with regard to their product coming out >> i am most positive among my

coverage universe on regeneron they are out with the antibody treatment that the president was given for his treatment of covid-19 what i like about this is that we have initial data, we have data that shows that in a subset of patients it works to reduce the time to recovery and we will also potentially have data looking at the use of this antibody cocktail as a prophylactic so think about vaccine-like protection before we have the widespread usage they should probably have about 300,000 doses by the end of the year and they are partnering with roche to get more doses globally >> and evan, we've seen the numbers tossed around about how much the u.s. government is paying for or helping to fund some of this research. it is hundreds of millions, possibly even sometimes over into the billion dollar range or more for a company say like pfizer or lilly or johnson & johnson, is

the covid program something that moves the needle in the end as much as it could for a company perhaps like a moderna or some other smaller company player >> i think clearly for something like moderna, it moves the needle a lot it gives them up front funding and also the ability to really show that their technology works. that is the key with moderna with someone like pfizer, j & j, it is horrific sharing and allowing them to being a accept rate what could be a multiyear vaccine development process into say six months to a year.a acce rate what could be a multiyear vaccine development process into say six months to a year so not so much that they need the billions of dollars to do the vaccine development, but it helps accelerate the process which we all need. >> as you look out the next year to two to three, is there a secular trend within bio far made i

biopharma and fphrma that says these companies should be outperforming or is large cap phrma the way you want to play that trend >> i think fundamentally, you know, i'm still positive on the biopharma sector there is a lot of innovation in oncology and rare disease. that is what i find more interesting. i agree that m and a remains a key theme especially among the mid cap biotech names. those are the names getting taken out by the larger biopharma players like i expect to see more transactions like that i'm looking at high quality assets on the small and mid cap names mainly in the oncology space and inflammation that is what will likely drive the sector the next couple of years. >> evan, thank you very much appreciate it. and coming up on the show,

in a first on cnbc, joseph wolk will join "squawk box" with more on the vaccine trial halt along with earnings results, that is 6:45 a.m and coming on deck for this show, earnings season set to ramp up with the big banks under the spotlight. we'll break down whether better days may be ahead for the battered financial sector. and coming up, dell it airlines ceo ed bastion will break down his company's quarterly results, that is at 9:00 a.m. eastern time ready to take your immune support to the next level?

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this is a big day for big bank earnings, they kick off with jpmorgan chase and citigroup reporting before the opening bell, hoping to show investors that the worst is behind after shares got hammered in the wake of the covid-19 pandemic for more on what to expect, i'm now joined by president and cio of menden capital advisers how big of a deal is this earnings season going to be for the overall markets? >> i think it will do a lot for confidence, i think that it will say a lot for a group that has been battered as you said. and has suffered on the earnings front because we had a brand new accounting treatment cecil take place right in the middle of the storm. and cecil requires you to recognize a loss the day you book the loan, your expected loss so much, much bigger reserves

than under the old accounting treatment and so it was massive in the first and second quarters of this year, the big banks have set aside over $50 billion and i think pretty close to having set aside enough even to see stilee criminal. and s kree sti certainly with the gdp growth and unemployment falling dramatically this quarter, we'll see some of, much better results out of the banks than last quarter. >> i'd like to focus on that a little bit we make a very big deal about the fact that when the loan loss provisions are taken, they are a hit to earnings when they take them, but if they don't materialize, they go right back into earnings, so there should be a bit of a tail wind here we know the economy is better now than it was three or five months ago, can we expect the bank earnings to really reflect that because the loans will

provisi loss provisions are better than we thought. >> >> i've talked to some banks that could potentially release reserves no one is going to because there is still so much uncertainty but they also did have a qualitative override and they will use that to keep the reserves in place. and so i don't think that you will see reserve releases until next year. but that is how strong the balance sheets are everybody, you know, when the selloff happened here talked about how much that banks balance sheets were in good shape, way too much capital, way more than the last crisis. the fed has not let the banks buy back stocks and they built these monstrous reserves so a lot of dry powder for earnings into next year, a lot of dry powder for growth and buybacks so we just need the demand for new loans because that is the one thing that won't be he wevi in these releases.

>> and strong balance sheets, what does it mean for bank dividends, how safe are they >> the fed mass a new methodology on the big banks in particular, most of the big bank dividends are quite safe i think that there is a couple that have cut. i don't think many more are on the edge here. and really it is because of these noncash cecil charges that you've got these issues. if you didn't have the cecil charge, obviously everything would be great and you are treating all these banks the same, so no one is getting singled out. so some of the banks have tremendous balance sheets and much greater ability to raise dividends, buyback stock, and they won't let them. so you see morgan stanley went out and spent $7 billion and bought an asset manager, you know, that deal is going to be allowed, buying back its own stock is not >> so with all of that in context, the mchl and a, divide,

cecil, everything else, where are you placing your bets, the money centers, the regionals what outperforms in coming six to 12 months >> certain >> several factors here. i think the regionals will outperform because m and a has to happen. you have a low growth environment, you've got technology winning the day which means that you've got to consolidate and spend money on improving your systems and at the end of the day, you've got to be able to compete. and there are so many nonbank competitors nipping at their heels and obviously we talked a lot about interest rates and spreads and yes the yield curve is widening, but it is still not great in a zero interest rate environment. so the only way to grow esh earnings is to con solidate and cut costs. and there is no group out there save energy that will have much better earnings growth into next

year than the banks. so you will have bigger growth, consolidation, credit quality will be much better. so yeah, i think that the regionals are a good place to be >> anton, thank you so much. xwloo a "ss.and that does it for u quawk box" is coming up next ♪ you can go your own way it's time you make the rules. so join the 2 million people who have switched to xfinity mobile. you can choose from the latest phones or bring your own device and choose the amount of data that's right for you to save even more.

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it is a big day for tech yesterday was a big day for the nasdaq today amazon is kicking off its prime day sales event overnight. and then later, apple will unveil its latest iphone models. supposedly the exterior will be different. not rectangular?

i don't know what that means and back on the campaign trail, president trump and joe biden are storming key battleground states and today marks the kickoff of earnings season. we'll bring you numbers from jpmorg jpmorgan, johnson sand j& johns blackrock. it is tuesday, october 13, "squawk box" begins right now. good morning, everybody. i'm becky quick along with joe kernen and andrew ross sorkin. and we were looking at strong moves yesterday primarily with the nasdaq and s&p was no slouch, it was up by about