it is 5:00 a.m. at cnbc global headquarters and here is your top five at five. president-elect joe biden unveiling his 1.9 trillion, yes, with a t, covid relief plan. chinese smart phone maker added to the trump administration's blacklist of companies with alleged ties to china's military shares of petco and poshmark soaring on their first days of trading as the ipo market roars to star 2021

jeff bezos blue origin planning to fly its first passengers by april with a hefty price tag. and invest in you, how americans are looking to achieve their saving and retirement goals a bit differently this year it's friday, january 15th, 2021, and you are watching "worldwide exchange" on cnbc. ♪ i'm dominic chu in for brian sullivan, the global markets are setting their day with stock futures incoming a pull back modestly so. the dow jones implied lower by 15 points, the s&p lower by 8 points at the bell, and the nasdaq at 12 points. this losses, yes, right across the board, but very modest the dow closing lower yesterday, posting back-to-back losses for

the first time in a month. the russell 2000 small cap index and the dow transportation index were the two winners, both posting new, by the way, record highs, so yeah, the dow is off a little bit, but record highs for small caps and transports. treasury yields backing off again slightly this morning as well bench park ten-year treasury note yields 1 p.11% two year, 1.4%, and now, to today's top stories. president-elect joe biden unveiling details of a 1 pnlt $9 trillion covid relief plan. among the things the proposal calls for, direct payments of $1,400 to most americans, an increase in the federal weekly unemployment benefit, as you can see there, raising the federal minimum wage to $15 per hour, extending eviction and foreclosure moratoriums for

renters and then money for education, covid testing and vaccine rollout. we'll talk more about that plan with nbc's tracie potts in just a few moments here first, let's bring you up to speed on corporate news. bertha coombs is here and joins us with those headlines. good friday morning to you, bertha >> good friday morning, dom. shares of china's smartphone maker xiaomi dropping sharply, the trump administration adding the company to a blacklist of firms with alleged chinese military ties with military companies in china that means u.s. investors can't buy those shares, and those who have them must divest in cement. xiomai responded saying it is not linked to help fix u.s./cha relations. china's official news agency reporting on a letter sent from

xi to schultz asking him for help jeff bezos company blue origin ready for flight yesterday it finished its 14th test flight of a rocket booster and capsule. people familiar with the company's plans tell cnbc blue origin is aiming to fly its first crude flight into space by early april. and timman fertitta is reportedly in talks to take his casino and restaurant assets public through spacs he operates the golden nugget casinos and hundreds of restaurants under the landry's brand. everybody is going spac these days. >> those four letters, the four letters of 2020 and now of course into 2021 as well thank you very much, bertha, we'll see you later on. now back to the markets, joining me now is defiance ets chief investment officer and cofounder, sylvia deblanski, a

friend of the show, happy 2021 to you what's your big thought for what's going to happen this year, given what we saw in 2020? >> good morning, dominic, great to see you and happy new year. i'm pretty optimistic about 2021 and for a lot of reasons i think we'll probably see positive gdp recovery in the second half of the year when the vaccines are sort of rolled out and people actually get to tak1a big chunk of it back, a group of people back to work, and i think that a lot of that will restart the economy. fiscal and monetary policy are going to continue to be supportive towards the market. we saw the america rescue plan rollout idea yesterday, so you know, whether or not it passes in the form that it's presented, i do think that the market will be, you know, flush with cash and that the economy will be flush with cash, and what happened last year when, you know, consumers got those checks is they they started spending, so once the consumer starts

spending, corporate profits look better, earnings have chance at getting better, and overall, getting people back to work and the economy in the second half of the year will lead to a larger and quicker recovery. >> so thematically, i mean, your background kind of gives you a little bit of insight into kind of how trends develop in certain industries, certain sectors. what exactly are you seeing this time around, at least in the early going for 2021 is it still about the technology trade, is it health care i'm hearing a lot more about things like beaten up energy and financials, is that value trade back, what's biggest on your radar right now? >> i think it's a little bit of all of the above you know, we always advocate for the barbell approach you want to hold on to your quality names, the apple and the googles and the facebooks, they're probably not going away. these are quality companies flush with cash. maybe the growth won't be on the same trajectory. rates are low enough we see bumps in the ten-year, they're low enough where cash is

cheap. these companies have strong balance sheets the airlines are going to get back up, the cruise lines will get back up, the banks will start doing better some of the service sector industries like restaurants and starbucks, which is sort of like widely open for takeout. once fully open, i expect to see some opportunities there, but one thing that isn't going away and is in its infancy in my opinion is to your point theme wise, next generation sector investing. you want to look at the next sector of communication, which is 5g, you know, names that connect us globally, allow us to share information globally, and quickly. they touch ai, they touch health care, they touch tech. you know, you just talked about stock. stock is a huge introduction to the market it's nothing new really. but it almost feels like something new because we had this 400% growth of stocks hitting the market last year getting access to, and you know, look at etfs here. you get access to a social capital, virgin galactic, draft

kings and sofi in the same index. i think that even if recovery is slow, innovation and technology are really just starting now, and it's sort of ten years ahead of its time, i think because of work if home, so if i was thinking about what will the next year or decade of faangs be like, it's going to be in disruptive technology and innovation next generation sectors like 5g and spac >> all right big themes to watch there. thank you very much for joining us we will see you later on this year. now to washington, d.c., news, as we have been talking about, president-elect joe biden unveiling his $1.9 trillion relief plan, and preparing for a second impeachment trial for president trump. tracie potts joins us with the break down of the latest good friday morning. >> good morning, everyone. we don't know when the trial will start for one because house

speaker nancy pelosi still has yet to transfer that one articl of impeachment over to the senate, and hasn't said when she will that's what would trigger the impeachment trial. the earliest possible start for an impeachment trial is wednesday, inauguration day. one hour after joe biden is sworn in as president. >> it's hard to predict how many will come down on the side of conviction. >> with our nbc poll showing the country almost evenly split on impeachment and removal, a handful of republicans are considering it >> i believe this president violated his oath of office and i believe there must be consequences. >> what good comes from impeaching president trump after he's out of office that's an unconstitutional attack on the presidency it will divide the country it will incite violence. >> reporter: according to "the new york times," an intelligence bulletin warns of extremists planning a race war. >> we're concerned about the

potential for violence at multiple protests and rallies. >> reporter: members of congress are concerned about their safety. >> many of us are altering our routines, working to get body armour. >> we're going to ensure that we have a safe inauguration. >> reporter: president-elect biden announcing his post inauguration plans, a $1.9 trillion rescue package, with faster covid vaccinations and a $1,400 payment to most americans. >> $600 already appropriated is simply not enough. we just have to choose between paying rent and putting food on the table. >> reporter: he's hoping the senate can move quickly on economic relief while dealing with impeachment of course dealing with security still a big issue, too, dom, with 20,000 national guard troops headed into washington, and now congressional democrats looking back and asking for an investigation into what they now remember as an unusually large number of visitors at the capitol the day before the attack they think some of those visitors could have been scoping out the building. >> yeah, with travel and leisure

restrictions coming full force for many companies as well tracie potts live in washington, d.c. with the latest on the moving parts thank you very much. now, when you come back, if you're like millions of americans, your 2021 resolutions probably include something about your personal finances sharon epperson joins us with how many people plan to achieve their saving and retirement goals this year, and how they might be doing it. it might be done a bit differently this year. as we head to break, check out shares of s.a.p. in germany, the software company posting better than expected results it sees flat revenues in 2021, those shares, nonetheless, up about 1 1/2% in the premarket trade. stay tuned a very busy hour ahead when "worldwide exchange" returns after this qckre ui bak

welcome back to "worldwide exchange." saving more has consistently been a top financial resolution for each new year yet some americans may try to reach that goal a little differently in 2021 cnbc's senior personal finance correspondent sharon epperson joins us with the latest look there. i always, and i know many americans want to save more but it's tough these days. how exactly are the numbers bearing out early this year? >> well, dom, you're absolutely right, about 40% of americans say they will actually be in survival mode this year focused

on saving for day-to-day money management, according to fidelity survey. but many workers are also trying to figure out the best way to maximize their retirement savings. 31-year-old angel tran works in cyber security her main focus this year, her own economic security. >> my top goals for 2021 is to actually be better about investing. >> she's saving as much as she can in her retirement accounts now so she's well prepared later. >> i have to play catch up, after i paid off my student loan debt, i can max out my investments. >> the maximum you can contribute to an ira this year is $6,000. you can put away up to $19,500 in your 401(k) if you're 50 or older, you can add catch up contributions to both, an additional $1,000 for an ira, and an extra 5,500 in a 401(k) tranh's retirement savings are mostly in target date funds

which automatically rebalance from stocks to bonds as you get closer to your retirement date this year she wants to start investing on her own. >> it's definitely one of my resolutions, of course investing is risky, but the bigger the risk, the bigger the return. >> financial adviser roger ma author of work your money, not your life says focus on what you can control in the investment landscape. >> what you're invested in, how much you pay to invest, and where you put each of those investments, what type of accounts used. >> then build on what you already own. advice she hopes will help her with her financial goal. >> i want to retire with a lot of money and be financially free. >> roger ma says one way to become a more independent inspe inspector investmenter is to -- investor, buying those investments on your own may give you a better handle on investing while making sure your accounts

are well diversified. >> but you got to do a lot of that work on your own and homework as well i'm wondering, sharon, your subject of the story right there talked about how she paid off student loans. there were quite a few people last year despite the fact that markets were at record highs that needed to tap into their 401(k) possibly for hardship withdrawals because of what happened with the covid pandemic what exactly did that kind of effect have on the overall industry and how exactly are people recovering or trying to recover from that kind of hardship withdrawal scenario >> well, certainly there was an opportunity to take a withdrawal from your 401(k) under the c.a.r.e.s act that allowed you to do that without having an early withdrawal penalty and we talked with fidelity, which is the largest 401(k) provider in the country, and they said that they actually had about 1.6 million people take distributions from a 401(k) plan or the 403 b plan that a lot of educators have in order to deal

with covid related financial impacts that they were facing. now, that c.a.r.e.s act allowed you to take up to $100,000 without having to pay any type of penalty if you took that out before 59 1/2. what fidelity said was the average amount was $20,400, a very small percentage took out the full 100,000 the issue is at that time that they're taking money out, many 401 savers are not saving at all. so there is a lot more catching up that would have to be done with retirement savings. but when you can, and what you can, put that away that is the advice that most people are saying is the thing to do in 2021. >> sthharon, that's one end of e spectrum, the end that people had to take hardship withdrawals for. we know there's been a k-shaped recovery out there many people out there have maybe maxed out their ira contributions or 401 contributions as well. are there other ways, maybe tax advantaged ones that those people can do to put more money

aside if they're looking for that more secure retirement? >> there absolutely are more ways there's one that you want to look into, if you have a high deductible health insurance plan, you want to look into getting a health savings account because you can get savings on several levels there in terms of tax savings, but in addition to that as you're putting money away for medical expenses today, if you don't use it all, you can invest that money to have for medical expenses in retirement is that's often the biggest expense for many retirees. so it's important to know that you can put in $3,600, if you're an individual, with a high deductible health insurance plan if you have a family that's on your health insurance plan, you can put away $7,200. >> big deals for sure there. sharon epperson with the latest on the personal finances thank you very much, we appreciate it. still on deck for the show, two charts that can tell you an awful lot about the market action happening right now we will reveal them. that's coming up next.

told's big number, 63% that's how many home buyers made an offer on a property in 2020 without seeing it in person, at urding to red fin th'sp 32% from the prior year 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.

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far in the early part of 2021. first of all, we're looking at small cap stocks versus large cap stocks small caps have been a huge under performer for a good portion of 2020, as you can see here the white line represents the small cap stocks and the ongoing line represents the s&p 500. here, the under performance has been around just about until the early part of last year or this year into last year in that third quarter. look at that move here small cap stocks are outperforms, perhaps a sign that some investors see a clearer path ahead for the economy in the wake of covid vaccinations happening right now. watch small caps, possibly a leading indicator. also a leading indicator for some in the market is what's happening with technology and semiconductors computer chips are used in just about everything these days. the more chips being used and sold, the better maybe the global economy is. take a look at this semiconductor etf over 68% over the cllast year.

it hit a record high in trading. one measure of semiconductor, the stocks index is off to its best start in years now, another part to keep track of. and then on the value side of things, there's been a huge focus on big oil companies, like chevron, and like exxon, why, because they were huge under performers as oil collapsed last year take a look at the recent trends over the last three months chevron is up 30%, under performed, and overall up 42 in just three months alone. a slew of analyst upgrades for chevron and exxon saying there are big picture tail winds that could be helping that particular industry and chevron and exxon could be ones to focus on there. investors have bid up the shares in the last three months we'll see if that trend continues on the value side of things. joe biden unveiling his

$1.9 trillion covid relief plan. what investors think about that plan, and a reminder, you can watch and listen to us live on the cnbc app, smartphone, bl, ater"wldde exchange" is back in just a moment ♪♪ hey you, yeah you. i opened a sofi money account and it was the first time that i realized i could be earning interest back on my money. i just discovered sofi, and i'm an investor with a diversified portfolio. who am i?! i refinanced my student loans with sofi because of their low interest rates. thanks sofi for helping us get our money right. ♪♪

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futures pointing to red arrows at the opening bell, modestly so after the dow posts its first back-to-back declines in about a month. and let earnings season begin. jp morgan, citigroup, wells fargo, you know them, they're all set to post their quarterly results later on this morning. it's friday, january 15th, 2021, and you are watching "worldwide exchange" on cnbc. ♪ ♪ welcome back to the show, i am dominic chu in for brian sullivan this morning on "worldwide exchange. here is how your money and investments are looking as we are halfway through the 5:00 a.m. eastern time hour. stock futures are pointing toward modest losses at the opening bell with the dow implied lower by 65 points the s&p implied lower by 8, and the nasdaq by 12 to 13 points. treasury yields also showing some red that means they are ticking

slightly lower the benchmark u.s. treasury note yield for the ten-year side of things, 1.1%, two-year side, 1.4%, and the 30-yearlong treasury bond, 1.86%, and we are watching shares of posh marc and petco, the p and p both began trading as publicly listed session. poshmark, they sell used clothes online, it closed up more than 140% meanwhile, petco, now the defunct, reborn, defunct, reborn pet product supply retailer shot up more than 60% both of those trades looking like they are continuing that hot trade for ipos we saw in 2020 as well today's top corporate story and washington story, president-elect joe biden unveiling details of a $1.9 trillion covid relief plan. eamon javers joins us with the details and there are the lot of implications for not just the political arena but the economic

one as well, right, eamon. >> right there's a lot in this package. let me get right to this the former vice president, president-elect, is calling this the american rescue plan, he says and his team says this will be just the first of a number of plans. he's dividing his response here into rescue and recovery this is just the rescue piece, and it clocks in at $1.9 trillion. the former vice president said yesterday that the country simply needs to get this done in order to recover from the enormous damage that it's experienced from the covid pandemic here's what he said. >> if we invest now boldly, smartly, and with unwavering workers and families, we will strengthen our economy, reduce inequity, and put our nation's long-term finances on the most sustainable course >> so let's go into the details here there's 400 billion for covid-19

response, 20 billion toward a vaccine program, 50 billion for testing. 30 billion for supplies and protective gear. 170 billion to get k through 12 schools and colleges open. the president-elect says he wants to get those schools and colleges open in the first hundred days of his administration there's direct aid of about a trillion dollars, including additional direct payments to americans, $1,400 direct checks to plus up the last round of checks to an even 2,000. there's $400 a week in federal unemployment insurance through september. 30 billion in rental assistance. he wants to go to a $15 an hour minimum wage, and then also there's aid for those states and local businesses that have been so hard hit. 350 billion in state and local government aid that was a deal breaker in the last round of stimulus negotiations $50 billion for small business grants and loans and $20 billion for public transit systems that have been so badly hit by this pandemic so dom, the question now is can any of this pass in a deeply

divided congress remember joe biden will have the majority after january 20th, but it's one of the slimmest sk majorities we have ever seen, a 50/50 majority in the senate with kamala harris as the tie breaking vote there, and a slim margin in the house of representatives. biden's team was asked about that yesterday on a conference call with reporters, whether or not they have the votes in the senate they said, well, we have been talking to mayors and governors about this so interesting that when they're asked about the senate, they're talking about mayors and governors those people on the front lines who see the daily need for this aid. they're opening that those folks lean on their representatives in the senate to get this thing passed it is not at all clear whether 1.9 trillion can pass the house and senate. >> you read my mind. i know and you know too and everybody else in america knows it's the nature of politics to go into compromise president trump didn't get everything he wanted president obama didn't get everything he wanted, so how exactly, then, do the democrats

and the biden administration push forward on certain things what exactly are the most important things in that $1.9 trillion package that they're going to throw the most political capital at or is this all going to be a big compromise at the end >> it's going to be a big compromise at the end. you know, the sausage making is unwielding this is the first ask from the biden team, and we'll see where we go. in terms of priorities, you know, that 400 billion around covid relief really seems to be important to them, talking to some of those officials on the phone yesterday. you know, they were astonished at the lack of planning, the lack of any national system that they've found when they came into the transition to deal with the trump team in terms of the coronavirus. they said it's much worse than they thought it was. so they're really focused now on getting that direct aid out to try to turn this coronavirus situation around, get those vaccinations happening they said there was basically

plan at the federal level to get needles into arms. that's something that they really need to focus on because they understand that if they don't do that, they can't really kick in the beginnings of an economic recovery, and they're a little bit frightened by some of the economy data they have seen worsening over the past month or so as the pandemic really sets in now with as many as 4,000 deaths a day across the country. you know, this is horrific stuff. if you turn that around, then you can begin an economic recovery, and begin to move on >> it's going to be one of the biggest stories in business in 2021 for sure, the recovery part of this whole covid pandemic thank you very much, eamon javers, we appreciate it. joining us is victoria fernandez, chief strategist. we heard what eamon said with regard to the asks of the biden administration, incoming administration from congress for covid relief how much are the narcotics dependent on what happens with direct government payments and

more relief on the fiscal side of things for america? >> yeah, dom, i do think the markets have priced in to some extent that we're going to get another package. i'm not sure they have priced in everything that we saw in this $1.9 trillion plan probably the $15 minimum wage, the state and local aid. you were just talking with eamon about things that maybe wouldn't make it into a final version those are two things i think would be negotiated strongly by the republicans, but the market anticipates there will be some form of direct payment, some form of assistance to small businesses and that's priced in to the market. that's why we had seen up until the last couple of days, the market continue to trend higher. i think it's already looking past this, though, it assumes it's there, it's baked into the cake the market is already looking six, nine months down the road when the reopening trade is more prominent. things are starting to open and get back to normal with the vaccine rollout. that's what the market is

focusing on right now, along with the guidance coming out of earnings, which obviously we know starts today with the banks. >> so what's most important, then i know that the covid relief and the trillions of dollars coming out of d.c. is important, but should we focus for investors on things like earnings, do they matter given the covid narrative these days >> you know, it's interesting. i was actually talking with a group of clients yesterday, and we talked about how the economic fundamentals in 2020 tended to hold their own, really led by the consumer, led by the housing market, and one of the key factors for us in 2021 is can those fundamentals continue to hold the positive headlines from the vaccine rollout are only going to take us so far. we've got to have the fundamentals there, we think manufacturing is going to continue to do well. we heard from the small businesses, inventories are really low manufacturing should do well if the vaccine rollout continues along it current path, then you're going to have services start to catch up.

the consumer is going to have more money in their pockets from the stimulus plan. that's going to allow consumption to continue. so those are key factors in 2021 i think we're getting to the point where we've kind of looked past some things through covid long enough at this point, and now we need the fundamentals to catch up i think they're going to do that if they don't, that's where you might see a 5, 6, 7% pull back in the market which for us would be an opportunity to buy some. o names perhaps you missed out on. >> let's talk about some of the names that you are drawn towards right now, victoria. i mean, 2020 was the year you could argue of big tech, the work-from-home trade, maybe even ipos and spacs what's 2021 going to be the year of >> you know, typically you wouldn't think in january it would be the big ipo time, but look, you were talking about

petco an petco and poshmark, they did rel really well in their opening trade. we have value in cyclical names. we open jp morgan, charles schwab, so we have some cyclical names, but we still really like that growth trade. we're overweight on the growth side we think that some o. tf the ths you talked about, the work from home, the change in people's daily lives where they are doing more things online, whether it's retail shopping, whether it's health care, fitness, look at some of the companies that you will need for all of that to continue, whether it's in the 5g space, like a verizon, whether it's going to be in american tower, where they're building out those cell networks. whether it's a broadcom, cloud business with amazon and microsoft. yes, those names have had strong runs in 2020, but we think the longer term trends that are set forward there are going to continue, and we'll continue to see growth in those names, but don't forget, things like housing we talked about, builders have a long backlog right now, and we saw your big

number, 63% of people bought houses without even looking at them there's some plays there as well with maybe lenan and home depot. >> always great to have you on naming those names we appreciate it we'll see you later on. >> my pleasure. coming up on the show, could empty new york hotels be converted to condominiums? governor andrew cuomo proposed the idea this week, but it may not be all that easy that full story coming up as you look at a live shot of midtown manhattan in new york city nature's bounty unleashes something exciting. say hello to a drug-free way to ease stress. stress comfort. a gummy supplement with lemon balm plus saffron, to naturally boost your mood. stress comfort from nature's bounty.

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welcome back to the show new york governor andrew cuomo making headlines with his proposal to turn empty hotels into apartments amid the virus pandemic but is it really that easy seema mody has been investigating that story, and s seema, it sounds good on paper, what's the problem >> here's the thing, dom, in a speech earlier this week, governor cuomo, he did propose converting empty hotels into residential housing buildings, an idea that other cities are reviewing as hotel vacancy in most cities remains below 50%. in new york, it's well below that at around 36% because demand here driven mostly by international tourists and conferences, the expectation is that the lodging industry in new york won't return to 2019 levels for three to four years from now. but converting hotels into condos or affordable housing is

not as easy as it may seem, especially in new york where rooms tend to be smaller, lack of kitchenette, developers will have to spend more money per conversion it can cost 3 to $400,000 per room, and then there's zoning laws that prohibit hotels from being built in certain parts of the city in order for conversions to work, the city would have to change zoning laws and also provide a tax and abatement program to incentivize developers so whether hotels convert into housing, it really depends on the subsidies and programs offered by the city and state to these struggling hotels that are reviewing a number of options. currently in new york city, 200 hotels still remain closed and it's unclear if a lot of these properties will reopen dom. >> i wonder, i mean, we've been focusing so much these days because of a hot ipo in airbnb, if we stick with that kind of

theme, airbnb up 10% yesterday, there's got to be something driving that we know that maybe some of the real estate stories, some of the travel stories are all kind of intertwined but let's talk about why airbnb is still going up so much even though we're expecting or many are expecting revenues to actually show a decline on a quarter over quarter, year over year bads. >> basis >> yes, you're absolutely right, dom, yesterday closing high as much ads 10%. he did talk about how prior to covid, airbnb had a number of other projects it was working on just looking here at a note from gordon hasket, developing a transportation and air travel offering, investing in the luxury space, expanding into hotels and creating hotel content. bottom line, dom, airbnb wants to be more than just a home rental site. they want to be an online travel

operator which squarely puts i in position to compete with the likes of expedia, and booking holdings, that sort of gained a little bit of optimism or attracted interest from investors yesterday, this idea that, again, airbnb from early on as a public company trying to expand beyond home rentals unclear when those projects will sort of be in fruition, and be prioritized but clearly cheskey setting his sights high. >> crisis does create opportunity, right, seema, so we'll see how that trajectory goes >> there you go. >> thank you very much for that. let's go from one area of hospitality to another airlines, delta posting a q4 loss to cap off its worst year ever the stock finished up on the day despite that loss. that report comes at a time when new travel restrictions and stimulus questions are leading the broader industry into a very uncertain 2021 joining us now is savi, managing director and airline analyst at

raymond james. you hear seema's report there. some are saying we could not see travel return for certain parts of the country to normal levels, quote unquote normal levels in three to four years. airlines, why do they keep going higher >> for one reason, airlines, they can direct their capacity where they need to, where the demand is higher, so that is encouraging. and what we have seen is like the demand environment is challenging but it is getting better, you know, every week the trend has slowed since what we saw back in october with new restrictions but generally we're heading in the right direction, and as the vaccines, you know, getting out to the population, and we start to see some of these restrictions come down, you can see things improve quite a bit as you head into the end of this year so i think this is a lot of hope and expectation for light at the end of the tunnel. >> that's the reason why, the light at the end of the tunnel argument is why we have seen it, and it's justified these airline stocks go higher

is there a separation happening within the industry among those who are better positioned for that recovery as it develops versus those who may have more baggage, so to speak >> definitely. and in two ways, one is, you know, we have more certainty about is that leisure and visiting friends and relatives type travel will come back i think and domestic travel will rebound sooner airlines that are exposed to that level of demand are better positioned and then there's another thing that's kind of separating the group, those airlines that have better balance sheets, that can take advantage of that recovery, and invest, and grow that supply, so there is a definitely separation that will happen coming out of this, but right now, i think there's the group move as just recovery >> so the rising tide, the rising drafts, if you will for the airline business are certainly taking them all up higher as an analyst, you're looking at the winners and losers on a relative basis

who's best positioned right now, who's going to outperform and which are the ones you want to stay away from >> the demand is very much leisure and vfr, as i mentioned, and very much domestic, our kind of picks early on is for, you know, leisure focused airlines or domestic focused airlines we like allegiant and alaska here and as the business recovers, i think sky west is another good airline we like as well. among the large caps, you know, southwest is definitely well positioned and for a recovery trade, we think kind of risk-reward in united looks interesting. and ones we would be a little more concerned about is like american i think they're well positioned from a geographical standpoint they have a lot of debt they need to work through over the next few years. >> how dependent is the industry on more fiscal aid for 2021. they made a lot of headlines for how many billions they got last year do we need to continue giving airlines that kind of money as

taxpayers for them to really survive? >> yeah, last year's c.a.r.e.s act was very important, especially the loan program. this new program helps for some airlines it's a little bit of found money it's really important for obviously the labor groups here, and keeps the airlines, it is a faster recovery. it keeps their operations on a ready mode i think from a stimulus standpoint, it's more important what the economy gets because once we can travel, we want a strong consumer, and we want strong businesses. i think that's going to be more important for airlines to go forward and come out of recovery and back. >> the travel and leisure recovery ahead thank you very much. we appreciate it on deck for the show, big banks very much in focus we'll get ready for today's major reports. it's jp morgan, citigroup, wells fargo, the big ones to kick off earnings season. and by the way, if you haven't

already subscribesd do so to our new podcast, "worldwide exchange" every day in audio format if you miss us, check us out on apple or spotify or whatever other podcast app is your fancy. we will be right back after this break. facing collagen that's all hype? new olay collagen peptide 24 with derm recommended peptides. hydrates better than the $400 cream. for visibly firmer skin. olay. face anything.

welcome back, the big banks kicking off earnings today with j.p. morgan chase, wells fargo, and citigroup all reporting results before the market opens. financials have staged a staggering comeback since the lows of 2020 as interest rates are climbing and stimulus has helped keep banks afloat joining us now for an earnings preview is girard cassidy, always great to hear from you. let's talk about whether or not the big banks are going to set a good tone for the rest of the industry and the market in the coming days? >> thank you, dom, and i think

they will set a good tone as you pointed out, we expect a number of the big banks to be reporting 4th quarter results later this morning, and those results are going to be driven by a couple of factors, first and foremost, of course, will be credit quality. as you know, the economy has recovered very nicely from the depths of the downturn in the second quarter, and the banks, i think are going to show that the credit picture has improved quite a bit. second, because these banks all have capital markets tactivities i think you're going to see very strong capital market results relative to 4th quarter last year third quarter is stronger than fourth, so i can see sequentially the numbers being lower, but year over year, the capital numbers will be very strong, and lastly, interest rates, the yield curve is starting to steepen. i think we're going to get some positive news on the direction o. m of the margin in 2021.

>> the interest rate yield is a huge part of the bank story. is there anything specific to these companies either on the money center side of things, the regional side of things, are there reserves that need to be watched for? what exactly will be the big theme for these banks not just this quarter, but for the better part of 2021 if the economic trajectory continues on that modest up side >> there are two very important themes for investors to keep focused on for 2021, and it premised of course on the economy as you just pointed out being strong in 2021 let's assume that the vaccinations are available to everybody by the middle of the year under that scenario, the number one line item that everyone should focus on is, again, credit quality i think we're going to find low loss reserve releasing throughout '21 we may see negative loan loss provisions, similar to what we saw after the financial crisis second, as you have seen this year, and you pointed out, the

stocks have been gang busters since the start of the year, and that's due to that ten-year government bond yield nooumovin the way it has if we're sitting a year from now, and bond yield is 175 basis points, that's steepening in the curve will impact favorably the banks is interest margins even further, which will help their profitability. >> so should bank investors, gerard, be more focused on yield curve sense itive banks. are there certain parts of the market and certain banks in particular that catch your attention on the positive side more than others. >> i think there are and those banks include, for example, bank of america, and it's due to what you just pointed out, which is asset sensitivity. these banks will seem to benefit more so in the steepening of the curve. a few of the regional banks, i think will also benefit, names like keycorp and regions

financial. all of these companies you might recall crashed during the financial crisis and they had indicated post financial crisis that they de-risked their balance sheets so not only do you get the earnings recovery in j.p. morgan, which is of course the stallward, or a u.s. bank corp., which is another strong company, these other companies, i think we're going to get valuation improvement as investors discover that they didn't have to cut their dividends there was no deprecation capitol, unlike what we saw in 2008 and 2009. and i put citigroup in that camp as well. >> all right now, we've only got about 20, 30 seconds left, over the last decade every time we speak i need to talk about distress in banks because that's how in many ways a lot of investors know you from the texas ratio and everything else. what's the biggest hurdle for banks in 2021? >> i would say the biggest hurdle is fiscal policy out of washington, d.c. that raises taxes too aggressively and slows

down the economic recovery i think that's the biggest potential hurdle for the banks in the upcoming year. >> gerard cassidy at rbc >> thank you > quk x" picks up the market coverage coming up next on this big day for big banks. did you know you can go to libertymutual.com to customizes your car insurance so you only pay for what you need? really? i didn't-- aah! ok. i'm on vibrate. aaah! only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪

well, good morning, president-elect joe biden unveiling his $1.9 trillion covid relief plan. we'll take you to washington for a look at what's in that proposal. shares of the world's third largest smartphone maker plunging overnight after the chinese company made a surprise appearance on the trump administration's blacklist and it's been a block buster week already, 2021, for ipos, a

firm, poshmark, petco, all surging in their public debuts it's friday, january 15th, 2021, "squawk box" right now ♪ good morning, everybody. welcome to "squawk box" here on cnbc i'm becky quick along with joe kernen and andrew ross sorkin. and we're watching the u.s. equity futures on this friday. we did see a little bit of a pull back yesterday for the stock market, and, you know, this came after a week of kind of treading water, i would say, just coming off some of those all time highs we are on track for the three major averages to end down this week, that would be the first time in five weeks that's happened s&p futures off by ten, the nasdaq down