it is 5:00 a.m. at cnbc global headquarters, here is your top five at 5:00. stocks are looking to extend their winning streak for three days in a row. it may be a fight. congress taking its first steps majorly toward passing that $1.9 trillion covid relief package. we're live in the washington with the latest there. shares of ebay are surging this morning as it becomes the latest online retail giant to report earnings results. apple moving ahead, motoring

if you will as it aims to ink a deal on that initiative. and hotels making a pivot, finding success by converting into the affordable housing. it's thursday, february 4, 2021, and you are watching "worldwide exchange" right here on cnbc good morning, i am dominic chu in for brian sullivan today. here's how your money and the global markets are setting their day up stock futures indicating a more modest opening bell. you can see the s&p 500 is implied higher by roughly two points we're pretty much flat on the dow jones industrial average and the nasdaq is implied higher by roughly 43 points as well. again, a very steady opening bell predicted, at least with the futures market right now this after the dow and the s&p 500 eked out slight gains yesterday. the nasdaq dipping slightly amid a drop in amazon shares.

still, though, all three indices are looking at solid gains this week between 2 1/2 and 4%, as you can see here we'll see how that plays out in thursday trading this morning, investors will be watching that weekly jobless claims number out at 8:30 a.m. eastern time ahead of tomorrow's very big monthly employment report from the government let's now go worldwide julianna tatelbaum is in our lo london newsroom with an early look at the trade in europe. it looks like we've got a little bit more of a modest market there as well. >> reporter: good morning, we started out in the green in europe but we have seen investors pairing back early gains. we've got the german and french market up 0.2% apiece, after yesterday's strong outperformance over in italy, investors are pricing in what former ecb mario draghi president may look like, and they have cheered that

prospect we've got the bank of england decision due later today no change to policy is expected but investors are going to be watching for clues around how the central bank is thinking about the possibility of going down the path of negative interest rates now, one deal that is firmly in focus here in the u.k., i want to highlight for you nvidia, both the u.k. and eu are reportedly set to launch formal investigations into nvidia's proposed $40 billion acquisition of u.k. chip designer arm. the financial times reports that the deal will face serious scrutiny, and could eventually be blocked the agreement has already raised antitrust and national security concerns in the u.s. and china as competing chip makers worry nvidia could distort the market for the u.k. firm's widely used design shares are holding out down about 0.9% dom. julianna tatelbaum with the latest in london

thank you. alphabet's ceo and australia's prime minister holding talks amid tech giant's threat saying he had a constructive media over australia's media bill that would force internet giants like google and facebook to pay for news morrison saying pachai raised concerns about the bill: shares of ebay are surging in the premarket trade following the company's 4th quarter results. earnings and revenues for the online retailer topping expectations ebay providing first quarter sales and profit guidance ahead of wall street's forecast. those shares up nearly 10% in the extended hours trade and securities and exchange commission investigators are apparently digging through social media and online message board posts for potential signs of fraud tied to that big short squeeze volatility that was in play for markets according to bloomberg, the

probe is being done alongside a review of trading data, to figure out whether posts were part of manipulative efforts to drive up share prices in companies like game stop and amc. the report adds the s.e.c. is specifically looking for misinformation meant to improperly tilt the market maybe pump and dump's possible under investigation at the s.e.c. let's turn now back to the broader markets as stocks fight this morning to keep their winning streak alive and your next guest says big technology may continue to lead the charge in pushing the markets higher, though profit taking may be on tap at least short-term. joining is jeff kilburg, founder and ceo of kkm financial thank you very much for being here the big tech story was 2020. it's beginning to be 2021 as well that trend continues is it good for the markets >> dom, i think it is good for the market, but you're absolutely right, the theme that we saw, not just in 2020, but also in 2019, is the domination of the giant cap tech. and sure enough, this week, we

were impressed with google and amazon let's not slight amazon. the stock didn't respond the way investors want they had a lights out quarter. a giant tech, move up nearly 10%. by and large, my point is yes, i am impressed with google we're looking for super bowl sunday but we had our super bowl this week. when you see google and amazon make up about 15% of the nasdaq 100, that makes me optimistic that we can see the nasdaq, the tech leadership move higher, but when we look at a technical perspective, we are seeing a little bit of straight weekend in technology. it nakmakes a lot of sense to bk profits, move the rotation trade, front and center where you can trim the exposure. xlk, you can trim some of the exposure, and we are seeing a lot of blue chip names, the essential names. we are seeing them get love specific in the industrial

sector. >> can we dig into the technical side of the technology trade because there has been more of a rotation even within technology. you mention amazon and alphabet. amazon had a banner year last year we know why, the pandemic, people shop more, people use more web services but alphabet was a real laggard last year, now it's up massively to start the year is it just this idea that there's a catch up trade in play, and is that going to drive the technology narrative in 2021 >> i think that's a piece of the puzzle when you look at apple, microsoft, certainly in comparison to google google was up 30% on a one-year perspective, where you saw apple up 75% there is a little bit of a catch up trade there no doubt about it. i think when you really drill down on the google earnings, it's talking about you tube. i know my 7-year-old daughter has done her fair share of watching you tube videos during the pandemic, but you tube went up 50%, so maybe there's a spinoff opportunity inside of google it's interesting to see how google started hitting on all

cylinders asthey were forgotte about, the euphoria around apple and facebook and amazon was something we do see a catch up trade. also, it's just the diversity of google's business. they have so many businesses under google's umbrella, look at the plethora of companies inside of that, that's been the driving force. >> what's the thing that worries you the most about what's happening in the market right now? we've mentioned short squeeze stocks, dislocations in the market because of things like the ipos that are coming to market, and the special purpose acquisition companies, and maybe signs of froth there what's the thing that has people like you, traders worried about the continues upside in the market >> it's the fed policy component. if there's a potential mistake in fed policy. i know there's been some fed presidents speaking about where rates are going. continues to articulate the fact that we are going to see low interest rates i have seen the ten-year-year-old and i have concern about the u.s. dollar

index, back above 91 that could be a short-term head wind, bigger picture, dom, i think that ripple, the big large stone that was thrown in the pond that caused all the ripples from gamestop, amc, i think that's starting to calm down, but you have to take note. that was one of the largest volatility moves, we saw the vix move up 60% in that day. there are reverberations, we still digesting, we're going to get back front and center, talking about blue chip, fed policy, and more importantly, what the administration will be focused on from a spending perspective as well as infrastructure. >> all right jeff kilburg, kkm financial, thank you very much, sir have a good day. >> you too, dom. now to washington, d.c. where congressional democrats have taken the first steps towards approving that massive $1.9 trillion relief package, this as president biden prepares to make his first foreign policy speech as well tracie potts is standing by in washington, d.c. with the latest

there. tracie, good morning. >> dom, good morning we heard during the inauguration, president biden say that he wants to restore and repair america's alliances, and engage with the world. today at the state department, we could find out how he plans to do that >> at the state department today, the associated press reports president biden will announce allowing eight times more refugees into the united states reversing former president trump's drastic cuts while continuing to fight covid. the federal government's first two mass vaccination sites just opened in california averaging 1.3 million shots a day, the u.s. is on track to meet biden's 100 day goal. the cdc reports the death rate is slowing down, and new cases are back at thanksgiving levels. >> the recent decline in hospitalizations gives us hope that the number of deaths should start to decrease in the coming

week. >> stimulus payments and other relief still stuck on capitol hill. >> i think we'll get some republicans. >> reporter: democrats are preparing to go it alone. >> the rushed budget process that will play out this week is exactly, exactly the wrong path toward making law. >> reporter: the house votes today on whether to strip freshman republican marjorie taylor greene of her committee assignments for pushing qanon conspiracies and violence against democrats. leader kevin mccarthy condemned greene but declined to take action. >> kevin mccarthy needs to clean that situation up. >> reporter: they actually want to see the ethics committee deal with this first, dom >> tracie potts with the latest out of washington. so much to keep an eye on. thank you very much for staying on top of all of that for us, tracie. when we come back, the exclusive social platform clubhouse seeing a big boom as the invite only app makes its way into china eunice yoon takes us inside the

craze over clubhouse over there. plus, american airlines once again warning employees of potential furloughs amid that fight over covid aid. and rbc capital's he helima croft, how it can shore up reports on big shifts we have more straight ahead when "worldwide exchange" returns after this break eah 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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exchange," let's take a look at some of the sectors and stocks you need to keep an eye. check out what's happening with the inves coe qqq which tracks the nasdaq 500 and the s&p 500, the small caps continue to outperform, up about 9%, and the qqq is up about 4 1/2%, and the s&p 500 is up 2% that small cap lead has been extending over the course of the last couple of months. we'll see if that trend continues. it could be a sign of coronavirus optimism in the overall market and economy next, though, check out that covid trade as well. the recovery trade, if you will. energy, the xle, the ticker up 10% on a year-to-date basis. meanwhile, consumer staples, down 3 1/2%. the reason why some traders are looking at that as the coronavirus optimism trade is because energy has shown signs of recovery, possibly for fuel

demand coming up, and consumer staples, who make cleaning products and sanitizing products are moving lower that gap is starting to widen as well watch that trend and see if that continues. the two stocks that have been the most important to the s&p 500 and the nasdaq, and nasdaq 100 are alphabet and tesla you heard jeff kilburg mention it the last few minutes. the alphabet shares on a year-to-date basis up 18%, tesla up 20% why is that important? these two stocks in terms of mega cap tech, and consumer discretionary services make up 5 1/2% of the s&p 500 waiting and those guys are off to the races this year. watch again, tesla and alphabet driving a lot of the market action the invite only social media application clubhouse is seeing a surge in interest following tesla ceo's elon musk's conversation with robinhood's founder on it. in china, access to the platform is in such demand it has fueled

a secondhand market for invites. eunice yoon is in beijing with more on that clubhouse, all the rage. tell us why in china >> dom, clubhouse referral codes are going today for $30 on a secondary market it's basically because elon musk has a huge fan following here, and that interview really just stirred up a big frenzy to join clubhouse. so much so that a cryptocurrency entre entrepreneur named justin son who is quite famous here for winning a bid to have lunch with warren buffet for $4.6 million decided to launch his own chinese version of an audio only app. it's called two. >> of course i believe cloud is a social transition, and it's going to be very popular in china in the future, but it feels like to me it's like the

2014, 2015, when tesla first get into china, so everybody is crazy about, like, esla, right but you can see it like after six, five years after this trend, it's kind of the new energy car has become much more popular in china i think these kind of scenes are going to be the same. >> reporter: so the way that son sees his app as different is that it's going to be android focused. he also said it's not going to be invitation only instead he wants to bring in more ordinary people, he says, and also he's going to prioritize emerging markets though he does want to go global he does want to see this app in developed markets ads well and finally, he ran through some numbers for me saying that currently they have 500,000 monthly active users his target for this year is to

expand to 10 million registered users. dom, just because he does see a lot of potential in the excitement, he says, of chatting with your friends, dipping in and out of different groups, all just audio so no pressure to have to, like, put on your makeup and be camera ready. >> so eunice, let's talk about this, how is it that audio only apps like clubhouse will survive given everything that we've seen with regard to video and all of the other clips that we have to kind of keep an eye on >> reporter: well, it's tricky, because i asked justin this as well because of the fact that especially these days, the controls here are quite tight on information sharing. but he said that because there are, you know, as you know, lots of different technologies here in china and a lot of them survive as long as they follow the rules of the country that

they're in so he does think that the overall trend and excitement over being able to chitchat and what he sees as not only a trend here in china but also globally will supercede some of the concerns from the authorities. >> how about censorship and restrictions, any concerns there? >> oh, yeah. definitely some concerns for people who use it. son said he's not so concerned again. he's going to be sticking to the regulations. but, you know, there are people who do share information right now on audio only chat rooms, and then they're talking about all sorts of stuff that maybe the authorities here might not like so that is a concern going forward. >> all right clubhouse, the latest craze in china. eunice yoon, thank you very much for that update there. still ahead on the show, gauging investment on short squeeze sentiment. breaking down a new survey on the hot topic that's gripping markets these days keep it right here

today's big number, $27.7 trillion that's how much public debt the u.s. had at the end of 2020, according to the treasury department a record high. the treasury expects borrowing related to the costs of covid-19 to remain elevated through 2021.

welcome back, let's check on this morning's other top headlines. nbc's phillip mena has the latest good morning. >> good morning to you the battle of the republican party is ending in a truce at least for now. house minority leader kevin mccarthy decided not to strip the controversial qanon believer marjorie taylor greene of her committee assignments. the third most powerful republican in the house liz cheney survived an effort to strip of her leadership role after voting to impeach president trump. the kansas city chief's barber tested positive for coronavirus. 20 people, including patrick mahomes were in line for a haircut. daniel killgore and marcus robinson were deemed in close contact.

kansas city plans to travel to tampa for sunday's game. a different kind of foam party in argentina look at that heaps of sea foam carpeting the beaches at the resort city the foam is produced when seaweed gets tossed around by strong ocean waves it's not toxic the phenomenon surprised beachgoers who wasted no time getting fun in the sun the southern hemisphere sounding pretty good right about now. >> i often forget in the southern hemisphere, it's summer time, and people are on the beach. it seems like there's something that should be therapeutic about swimming in seaweed foam. >> i'm sure spas would change a lot of money for the privilege >> a new trend, and phillip mena gave it to us. pay pal on the rise, up 5% following quarterly results. we dive into what's fueling that climb and as a remind e watch or listen to us life on the cnbc

app as we take a look at times square, midtown manhattan new york city, "worldwide exchange" is back right after this

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good morning, futures pointing to green arrows at the opening bell as the s&p looks to build on its three-day winning streak a developing corporate story, sources tell cnbc, apple is close to a deal with hyundai kia to manufacture an apple branded c car. plus, could this be a match made in real estate heaven.

we'll bring you the story of apartment developers now looking at hotels. it's thursday, february 4th, 2021, and you are watching "worldwide exchange" right here on cnbc. welcome back to the show, i a.m. dominic chu in for brian sullivan this morning. here's how your money and investments are looking halfway through the 5:00 a.m. eastern time hour. as you can see, we are seeing some modest gains in the major indexes. the s&p is implied higher by roughly 6 points, the dow implied higher by 34 points and the nasdaq implied higher by roughly 53 after the dow and s&p eked out slight gains in yesterday es oo tr -- yesterday's trade. all three indices are looking at solid gains this week. it's only thursday we haven't even started yet but we're up 2 1/2 to 4% on the week this morning, investors will be watching the closely watched

weekly jobless claims number at 8:30 eastern time, ahead of tomorrow's very big monthly employment report from the labor department well, making headlines this morning, sources tell cnbc apple is close to finalizing a deal with hyundai kia to manufacture an apple branded car the autonomous electric vehicles would be made at a kia assembly plant in west point, georgia the apple car is tentatively scheduled to go into production in 2024. apple shares up 1 1/2% premarket. shares of pay pal rising this morning. the digital payments company posting better than expected quarterly results. total payment volumes rose 39% year over year, and the company added 16 million net new accounts in the 4th quarter. those pay pal stock shares with up 5% in the premarket trade and american airlines is warning 13,000 workers that they could face furloughs next month. that's when a second round of federal payroll aid is set to expire in a note to staff, american ceo

said quote, the vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative covid-19 test have dampened demand, end quote. united airlines has warned 14,000 of its staff about the possibility of furloughs as well it can happen sometime in early april if fnew covid relief is no passed before that president biden has hit the ground running with a slew of executive orders in his first two weeks in office. among the top priorities, energy and climate change policy both at home, and abroad as well. for more, let's bring in helima croft, global head of commodity strategies at rbc capital markets and also a cnbc contributor. good morning, helima, let's talk about your role, you have worked in an analyst capacity in the government before. you have done it theory on wall street what's your first read what is president biden's energy

policy >> well, i mean, president biden has been very clear, he's looking to speed the transition away from fossil fuels as quickly as possible, and we think the acid test for this administration, when it comes to pipeline permitting, when it comes to issues like will you get leases renewed for drilling on federal lands is does it get you to net zero by 2050, and they really talk about climate infusing all aspects of government policy, whether it be at the state department, whether it be at the national security council, domestic policy so again, i think it's a very very ambitious climate goal. they're looking at this $2 trillion plan to help drive renewables growth, electrification of a vehicle fleet. again, though, the question will be how much can you get through congress there are things you can do through executive order, having to nmake compromises with congress is a lot on this. >> where do you deploy the political capital. there's only so much to go around it's not unlimited

where do you focus the efforts if you are the biden administration on certain projects, certain types of things is it solar versus wind. is it trying to reduce carbon emissions. what exactly do you say, hey, this is what i'm going to really throw my support into. >> when you want to look into what you can get done with republicans, there's a bipartisan movement developing for things like tax breaks for wind and solar look where some of these jobs are. they are in states like texas, so that looks like an early win. also things like carbon capture, utilization, and storage looks like there's broad bipartisan support for that. interestingly enough, there's also support for advanced civilian nuclear technology, so those look like the areas where you can drive support on both sides of the aisle i think it's going to be trickier on things like phasing out subsidies for fossil fuels, that's going to require changing the tax code, i think you could see opposition from rust belt

democrats on things like that. it's going to be a series of congressional infrastructure build. they're going to rely on executive orders for things like again, the issue of drilling on federal lands. they came out with a pause on that, a number of companies already have licenses for drilling it's not an immediate issue, but when you think about a couple of years out and these companies are looking to get new permits will they be able to get them. those are the kinds of questions we're going to be looking for. >> i'm also curious, many of these efforts are of strategic importance to the u.s., you could argue, especially when it comes to energy independence you used to be at the cia, you used to look at these things from kind of a national security perspective, what exactly is the most important stuff that the u.s. needs to do on the energy front, whether it's pe ttro chemicals to secure the future at the biden administration's helm. >> i think it's interesting you

brought up the issue of energy independence the top administration talked about energy dominance and an interesting question is going to be if you're looking to potentially, you know, shrink the footprint of u.s. drilling, they're not talking about banning fracking they're not talking about banning u.s. and gas exports they are signaling they are looking to shrink the footprint of drilling over time. the question is does that undercut your foreign policy of american energy independence are you potentially going to be more reliant on oil and gas from traditional fossil fuel producers? i think that's going to be an interesting question i think when it comes to foreign policy, it's going to influence potentially how we deal with china. we absolutely want china to continue the policy of coal displacement we want global climate accords the question is how much do you give into china to get progress on climate issues and does that potentially impact how you deal with them on others.

the biden administration has been clear that the need to get china on board on the climate front is not going to impact how they deal with them on issues like hong kong, the uyghurs, intellectual property. we have to see what kind of compromises will be made >> helima croft, always great to get your expertise thank you. >> thank you. coming up on the show, why hotels could be the solution to real estate developer's problems first, as we head to break, other top headlines, the european union and u.k. are reportedly set to open probes into the nvidia's proposed acquisition of chip designer armed holdings through the financial times. chip rivals have called for the deal to be blocked qualcomm siehares are lower following a mixed quarterly report revenues did fall shy. and consulting giant mckenzie and company, reportedly agreeing to a $573 million settlement with states over it

work advising purdue pharma and other opioid companies the deal is expected to be announced later on today keep that in mind when you're watching top stories stay tuned, "worldwide exchange" is back after this no one likes to choose between safe or sporty.

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welcome back to "worldwide exchange," finding an affordable apartment was hard enough before the pandemic now things are even worse as land, labor and material costs climb higher, builders say putting up new affordable

housing has become not so affordable that's why some developers are looking at hotels, hotels believe it or not. diana olick has more on the story of match made in real estate heaven, how is it that we can turn hotels into apartments? >> reporter: kind of looks like a hotel. that's because it recently was one. but just before the pandemic struck, developer david peters bought it and converted it to town square place, mostly affordable apartment units with some remaining hotel rooms >> what we saw when the pandemic struck is we saw even more demand, i think, for the micro apartment style affordable housing. >> reporter: the shortage is now critical, affordable so called class c apartments are 96% occupied nationally, 99% occupied in the midwest, according to real page the pricier, class a apartments are more plentiful meanwhile, hotels are in deep

trouble. the share of hotels currently behind on their mortgages rose to just over 18% in december that's even worse than retail real estate. but it creates an opportunity for investors like peters to buy properties to convert at bargain basement prices. suite hotels are the easiest to do, while regular rooms require a bit more work, but it's all far less expensive than building new. >> we can offer the potential residents a better value and we can offer the investors a good solid return. >> michelle wickstorm was relieved to get a place at town square. >> it's hard to find anything that's affordable or within my price range without having to have three months' rent or three months of your income. >> it's kind of a win, win, win. the community wins, the residents win, the investors win.

>> reporter: peters has two other hotel conversions under contract one in minnesota, and one in south dakota which he's getting for about half value it was appraised at three years ago he compares this to what happened during the sub prime mortgage crisis a decade ago millions of homeowners defaults on their mortgages and investors came in to buy the properties and convert them into lucrative rental housing dom. >> this is a fascinating story to me because this is the crisis can lead to opportunity type thing. first of all, diana, how difficult is it to convert these given all the strict zoning regulations, the types of things you can do with certain types of properties, i mean, do you expect to see a lot more of this even as hotels recover >> yeah, i mean, look, it's a little bit tricky because the zoning for a hotel is different for the zoning as a multifamily apartment building, but you can keep some of the units as hotels, as he did in one of these properties in minneapolis. he also says you want to work

with the locamunicipalities bece they need affordable housing and they will want to work developers they want to get it done he says it's not that difficult as all i think you're going to see a lot of this as we try to get affordable housing and investors are looking for a good return. >> speaking of the governments at play right now, when it comes to affordable housing, there ar often incentives for developers to put up those properties, how do those incentives play into the economics behind the investments in these types of conversions. >> reporter: they absolutely help a lot, and you're going to see more of that under the biden administration we have heard about that from the department of housing and development. you will see more of this. you will see more of it going to investors. the issue, though, is that we are seeing exorbitant costs for builders, on the residential side, as well as the multifamily

side for land, labor and materials, and when you talk to developers, they say for class c, it doesn't pencil that means the amount of money they're going to have to spend to put up a building without high rents is not going to give them that kind of return they get incentives but the costs are high this is one way where the costs are a lot lower to get these billions into good use. >> real estate distress turning into real estate opportunity diana olick, thank you very much for that story we appreciate it. now back to the markets, things appear to be leveling off, following the increased volatility in relation to the short stocks and investor sentiment i'm joined by caleb silver, editor and chief over investopedia so has it taken a bit of a hit, investor sentiment because of the volatility we have seen, caleb. >> it's the trust that took a hit. the volatility, the frosty of

the day trading over the last week has hit our readers in their trust mafactor 42% say they trust the stock market less than they did six months ago just because of the wild swings and the action of the past week. in terms of sentiment, they're still bullish, they think equities, large cap equities are the way to go. we have been surveying them since last february before the pandemic was official. they have remained bullish, they are still there. this has done a number on trust, dom. >> if it's done a number on trust, what do you anticipate will be the ramifications? does this bring more investors into the fold that weren't there before does it then take investors that were at the fringes and push themout because they have lost something in terms of the volatility what exactly is the overall health of the business given what we have seen? >> well, we've seen the online brokerage bring on millions of customers in the last year, without question some of them more than others. folks knew to trading and investing thought put money in

and everything went up that has been true for the last couple of years. the last couple of weeks, though, has been all over the place with the hotly day traded short stocks folks came into the market, made early trades, probably lost a little bit of money, and that's going to knock people out. we see this at every cycle when we have trading mania and new people coming into the market. i think you'll get a balance of folks who are in, which is very good without that education to know what they're doing, they run the chance of losing money that said, most of our readers and these are active investors of all ages are still bullish, they're still bullish on big tech, and a lot of them, 25%, day traded stocks. i think the net, dom, is that you'll see more people actively involved in the markets, and that's a new dynamic for institutional investors, and retail investors to consider. >> one of the things we have seen a lot of controversy and heat around, in this discussion around short squeeze volatility is whether or not brokers should be responsible for some of the volatility trading rules that have been put into place

i harken specifically to robinhood, halting trading or severely restricting some of them in terms of those short traded stocks and the options around them. is there something out there that tells us that those broker rules are in focus for many of these traders, knowing they are in positions and maybe can't get out as easily or into them as easily >> absolutely, and i'm glad you asked that i think part of the trust factor is not just the stock market might be rigged. some people were disappointed with online platform 63% of our readers say they don't want their broker to tell them when they can and can't trade. they don't want to be limited when the market gets volatile. some people couldn't get out of trade. their disappointment extends from markets to platforms, and platforms have a lot of work to bring investors and traders in the last week. a lot came in the last year. brokers are listening to what folks are saying

you'll see adjustments and movement in the industry they'll be focus by readers who are active investors they use platforms and tools every day. >> before we let you go, one of the other things with regard to the brokerage side of the controversy is the notion that the brokerages did what they did for self-preservation. do you think that a lot of your readers and survey takers understand that a lot of what happened was because they couldn't make good possibly on some financial obligations, and that's why those trading restrictions went into play? >> i think we have some very sophisticated readers and traders who visit our site, who know that. i think a lot of other people don't read the terms of agreements, don't know that's how the brokers work and they were doing that for their own businesses and to protect their customers. i don't think they're paying too much attention to that it was the black and white of oh, my gosh, the stock that i bought is losing money, and i can't get out of my trade or it's going up and i can't get in that's frustrating for people. it's a learning curve for retail

traders who are new and the brokers and platforms that are bringing these people on it's a new relationship but it's also going to be the new dynamic going forward. millions of people have come into the market. that's probably a good thing. >> this story is not over yet from the market side or investor side caleb silver, thank you very much. why some could be signaling for a pull back in stocks. if you haven't done so subscribe to our new podcast, "worldwide exchange," every day in audio format if you miss us here live on air check us out on apple or spotify or whatever your podcast choice is "worldwide exchange" will be back right after this.

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joining me is howard capital management ceo vance howard. thank you very much for being here this morning. let's take us through the market narrative right now, as an investor that invests for clients in mutual fund format, what exactly is the thing that has you excited about why the markets should be where they are right now? >> our proprietary indicator have been spot on on trading through the pandemic and even now. it's positive right now. any pull back we see is a buying opportunity. last friday in all the turmoil, we were cash on the sidelines we were putting to work i think this market is poised for a great breakout here. we keep looking at some of these faang stocks, microsoft is starting to break out. apple has been breaking out. the lot of them have had five, six, seven month trading ranges and they are breaking out of those. we're bullish. could we get a little bit of a pull back, of course we couldment you look at what's going on with the pandemic, what's going on with the economy, and i can't imagine why

investors wouldn't be investing right now. >> hcm by line, i don't mean to you to give the store away, i don't want you to go through the secret recipe and all the herbs and spices that go into it, but that's a technical indicator that you have developed. what exactly are some of the factors that go into that buy/sell indicator that you have, and why is it pointing more towards buy these days? >> well, the hcm by line is math driven everything we do at howard capital management has to be math driven. we wish we were so smart we knew what market was going to do tomorrow or next week. we're not that smart we have to trade math. that's the backbone of our whole firm if the by line is positive, we're 100% invested, if it turns negative, we scale out it's been a year since the market fell out with the pandemic in february, the end of february and the beginning of march, we were almost 60, 65% in cash, and then the hcm by line went positive again, the first week of april by the second week of april, we

were 100% invested were we that smart to know the pandemic was going to start to ease up or the economy was going to start to turn around or the stock market was going to turn around, the answer is no, but math did and i don't know how people can trade in an emotional situation. i think they just make mistakes with that. everything we do has to be quantitatively driven and math driven and the by line is positive right now any pull back we see is an opportunity to pick stock. >> what goes into the by line. what factors are they technicals from the charts, from the math perspective, certain indicators, economic data points what exactly -- what are one or two of those things that the by line looks at to say buy or sell >> we mathematically derive it a lot from the equity curve of what the market is actually doing. it's a proprietary calculation some of it is based on new highs and lows on the new york and nasdaq anytime you've got a market making 30 day new highs, 52 week

new highs, that's telling you about the strength of the market, and on the opposite side, if you're making 30 day new lows, six month new lows, 52 lows, something is wrong, and you may not need to know what answer to the wrong is, what you need to know is you need to get out of the way ifthere's more sellers than buyers and the market is going lower. that's not the case right now. the hcm by line is strong. we're bullish at vance capital. >> rubber meets the road here, what are you buying, then, if you think that the market is to be bought on every dip >> you know, this is an interesting question i think it's a great question. you know, last year when i was on your international station, we were looking at buying small caps last year issue the math was putting us in small cap growth, small cap value. we have been picking up small caps by etf. even on the stocks right now, as far as technology goes, there's so many great technology stocks, even the old classics, apple,

microsoft, alphabet, all of these are viable, amazon, very viable stocks right thousand, and i think they're going to do great in 2021. >> so with that in mind, what's your biggest fear for 2021 >> something that we can't see coming i think that's any money manager's great fear is the great unknown of some disturbance overseas or an international event or what if this pandemic, a new version of it breaks out, and starts to mutate those are the kind of things that we can't control. what we can do, though, is we can develop systems that take the emotion out of the equation, such as the hcm by line, math instead of fear and what we don't know that's one reason we trade, take the emotion and fear out of it. >> thank you very much for being with us. we appreciate your thoughts. >> hey, thank you. let's take a look at the markets on the way out here. we can see the dow implied higher by 40 to 50 points. the s&p higher by 7: and the

nasdaq higher implied by 58 points that does it for us here on "worldwide exchange. "squawk box" picks ualthp l e market coverage and it comes up next when you switch to xfinity mobile, you're choosing to get connected to the most reliable network nationwide, now with 5g included. discover how to save up to $300 a year with shared data starting at $15 a month, or get the lowest price for one line of unlimited. come into your local xfinity store to make the most of your mobile experience. you can shop the latest phones, bring your own device, or trade in for extra savings. stop in or book an appointment to shop safely

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good morning, apple, apple, nearing a deal with major auto makers to build an autonomous electric vehicle details are straight ahead ebay shares are surging. the company said one in ten online shoppers in the u.s. bought something on its platform over the holidays. plus, we'll dig into the backlash against hedge funds on reddit with a former state pension chief who kicked off his tenure by firing dozens of hedge funds. it's thursday, february 4th, 2021, and "squawk box" begins

right now. ♪ living on the edge you can't help yourself ♪ ♪ living on the edge you can't help yourself ♪ ♪ living on the edge ♪ >> good morning, everybody, welcome to "squawk box." this is cnbc and i'm becky quick along with joe kernen and andrew ross sorkin. welcome to "squawk box." let's take a look at what's been happening with the u.s. equity futures at this hour yesterday was a bit of a muted session, mixed session, the dow and the s&p 500 were both up slightly higher. they were each up by about 1/10 of a percent the nasdaq gave back two points, that's it. you can see this morning that the dow futures are indicated up about 44 points, the s&p 500 now up three days in a row i indicated up another six points and the nasdaq futures up by about 57 also take a look at what's been happening in the treasury markets and you can see at least right now, we check the ten-year, we look at most closely, yielding 1.138%, that fiel