♪♪ -- captions by vitac -- good morning welcome to "street signs." i'm julianna tatelbaum global yield spike a gap with the 30-year treasury of the the boj announce it is will buy 10-year government paper. oil prices drop with geopolitical and pandemic concerns running high.

>> created a situation where we are dependent on them. why? beca because, because it was local gas. >> russian and ukraine prepare for a fresh round of peace talks today. volodymyr zelenskyy takes a harder line after signaling kyiv could be ready to compromise >> translator: our priorities are known. ukraine sovereignty are beyond doubt. effective security guarantees are mandatory. our goal is obvious. peace and normal life for the normal state as soon as possible. and the white house rushes to walk back an ad-libbed line taking the statements bacback

>> for god sake this man cannot remain in power. welcome to "street signs." glad to be back on air what historic for markets. it is all about bonds at the moment with a bond yield sky rocketing as the investment community is pricing in a more aggressive policy tightening path for the federal reserve now embracing for 50 basis point rate hikes yields are continuing to move higher this morning. 10-year bonds. the u.s. 10-year trading at 2.25%. the bund at 2.2 basis points over in italy, 2.15% the picture is the same across the globe when it comes to the move higher in bond yields

that is a big theme for the show that is the picture right now. in terms of equity markets, a rise in european equities. we have the green across the board. german market out at 1.2% higher among the best in the europe mark ftse 100 up. we saw retreat in european stocks ending 2% lower for the week turning to oil, we've got a pull back in oil taking place this morning. in terms of the oil majors, some resilience we are seeing a bid across the board for european equities. bp is down .60%. shell is down .30% majority are showing resilience in the face of a pull back in oil. let's look at wti and brent

which are slumping this morning. brent down 3.7%. wti crude down about 4% to $109 a barrel one of the key factors that investors are considering this morning is what's happening in china. of course, concerns of the conflict in ukraine and concerns about what is happening in china. dan murphy is joining from us the global energy forum in dubai. dan, what is your understanding of what is driving oil down this morning? is it china with the new covid lockdowns coming to the floor? >> reporter: julianna, that is right. confirmation we will have shanghai, the largest city in china, shutdown for the next four days for mass testing and then again four days after that. that has sent oil prices in a tail spin. we actually have prices down

significantly now. of course, this is not just a story about demand we are talking about the impact on supply here i'm coming here live from the atlantic council global energy forum where top leaders in the oil and gas industry are discussing the outlook for supply, but, of course, the unfolding security situation that we see in europe and renewed concerns about exactly how these countries are going to keep the lights on now that russian barrels effectively shutout of the global oil market we have seen over the past two hours is comments from the uae energy minister and his excellence talking about how they can respond he said this is a chriss that has been playing out for a long period of time it has no easy solution. his part of what he said only a few moments ago. listen in.

>> increasing. obviously we need to make the energy more affordable we cannot do it while we have been asked to just invest and increase the production and no one is supporting. at the same time, we need to realize that the geopolitical situation is very tense and it is not only affecting oil and gas sector, it is affecting every aspect of our lives from the food security to the rare minerals to everything so basically, we need to be courageous to tell consumers, your bill will be doubled or tripled in the future. >> reporter: so addressing the forum only a short time ago. this is an important comment to flag for you particularly as we come into the opec meeting

taking place late nr in the wee. analysts telling us that it is likely opec will stay the course and continue the pledge of 400,000 barrels per day. instead, not turning on the taps and resisting continued calls from the united states and west to raise production to alleviate the price and concerns we see playing out in the market. what is also interesting here is the dynamic within opec with some of the major producers. including the uae and saudi arabia ultimately looking for security guarantees before up easing the calls from the west a lot playing out in the marke at this point and the other fear here is if we don't see opec acting this week, the stakes are raised for the biden administration which is talking about additional release from the strategic reserve to counter what we see playing out in the

market right now more conversations to come over the next days over the energy forum in dubai back over to you >> dan, thank you so much for running us through the latest in energy markets i want to give you a check at how treasuries are trading this morning. a huge amount of focus on the yield curve with the gap with the five-year and 30-year inveinvv inve inverting. the u.s. ten-year is trading at 2.15%. let's are bring in daniel more i morris for the morning great to have you with us daniel what is your take on bond markets? this is a sign of he is regula recession to come. how concerned are you? >> you are right to be paying attention to it if we look at

the last nine hiking cycles in the u.s. recession in seven of them it seems to be right more often than not that said, this is the best case i think what we need to remember is what is different this time is for the most part, the globe is coming out of the pandemic lockdown we have robust level globally that is giving us more curb yan than otherwise if we take the eurozone and the downgrade to growth over what is happening in ukraine in march, the forecast in the eurozone was 4%. the latest is 3.3% without question it is all in, but still at a high level you see similarly strong levels for the u.s. worries at some point at the

future and some recession. we don't see it as a near-term threat >> what about what is happening in china i'm curious how the economic outlook there plays into your growth outlook we see measured put in place china sticking by the zero covid policy for now that means more lockdowns. to what extent does that pose a risk to growth >> i think historically we looked at china as one of the global growth states with inflation and capacity with the economies to meet demand, that is not necessarily what we need right now, a surge in growth from china. with that view, issues the government needs to address domestically they have a priority for them which is managing the pandemic that means less stimulus from

the global point of view in terms of chinese contributions the priority there is more on supporting the economy through phy physical stimulus or when we contrast what is happening with the euro and fed able to loosen monetary policy in the world. >> what does that mean for the view on chinese equity you see views out with some investors saying they are uninvestable particularly from the speculation with the regulatory stance on technology. what do you think? do you think valuations are attractive in china? >> it is risk and reward what we have seen given the under performance in chinese stocks for a year now. if you look at relative valuation, chinese equity

relative to the rest of the world is low however, we recognize there are risks associated with that everything that is happening around zero covid in particular. for us, the balance with the opportunity that we see in china and the medium turn and valuations in the short-term is why we have gone over weight chinese equity. >> fascinating what about developed market equities going back to your initial comments around a recession not being your base case near term what does that mean for your investment strategy? >> if we think about the dynamic at the beginning of the year where u.s. equities under p perform european heequities it will be for growth stocks in

the u.s. of course, now in europe, having the other issues in terms of demand and geopolitical crisis and we ended up, if you will, with japan which has an advantage of somewhat far removed from what is happening in europe. even for japan, valuations are attractive rarely happens for now, within the portfolio, our preferred market is japan. >> japan and china two of the preferred regions from a sector or perhaps perspective, howare you thinking about growth versus value? >> well, certainly that's been the key over the last couple years frankly. i think what we've seen over the last couple weeks with initial rally in real yields that took

some of the pressure off growth stocks if you look further ahead, you would anticipate a return for the dynamic efficinitially in 2. rising bond yields and rates better for value stocks on the nominal yield front and particularly when that is driven by rising yields and particularly challenging for growth stocks. we don't have an allocation with growth and value i think the sense would be value has a bit more room to run >> daniel, thank you so much for joining us daniel morris. coming up on the show, president biden delivers a fiery warning to putin in warsaw is his strong line on the war resonating with voters at home we'll exdiscuss with eric cantor after the break.

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welcome back to "street signs. ukrainian and russian

negotiators will have peace talks today. zelenskyy said he could accept a neutral position with relation to nato and may be able to reach a compromise on the status of the eastern donbas region in exchange for the end of the violence however, zelenskyy took a harder line in the video address to the ukrainian people >> translator: a new round of negotiations ahead of us we are looking for peace without delay. i was lminformed of an opportuny meeting in turkey. this isn't bad look at the result the priorities are known ukraine sovereignty are beyond doubt. effective security guarantees for the state are mandatory. our goal is obvious. peace and restoration of normal life as soon as possible. >> gabe guettierz has more.

>> reporter: julianna, peace talks in turkey. an adviser to the minister here in ukraine said he expects no major break through, but it is important to hold the talks. over the weekend here in lviv, the western part of ukraine, there were two separate locations that were hit with air strikes just less than 50 miles from the polish border while president biden was preparing to speak there. the mayor of lviv saying it was likely sent a clear message to the president. five people were injured and no one killed fighting continues to rage in the eastern part of ukraine and we are also getting an update from local officials in mariupol

where there are 160,000 people in that area according to officials. the mayor of that city says public transportation there has been specifically under attack by the russians. we are hearing from ukrainian officials that the humanitarian corridor has been shutdown because intelligence suggests that russians would bomb that corridor that speaks to the growing unrest in the city as russian forces close in. over the weekend, i spoke with several refugees from that area. including one woman from mariupol who had to walk 25 kilometers from mariupol she had to walk that area with her granddaughter. she was very emotional once she reached lviv

the local officials, giujuliann insist this is a catastcatastro. >> gabe, thank you for joining us the white house has sought to clarify that president biden is not seeking regime change in russia after the following comments in warsaw over the weekend. >> ukraine will never been a victory for russia freed people refuse to live in a world of hopelessness and darkness it will have a different future. rooted in democracy. of decency of freedoms and possibilities. for god sake, this man cannot remain in power. >> various u.s. officials sought to place biden's comments specifically on ukraine.

secretary of state blinken stating washington is not looking for a leadership change. >> president biden said vladimir putin cannot be in power or wait for or engage in aggression against ukraine or anyone else as you know and you heard us say repeatedly we don't have a strategy of regime change in russia or anywhere else in that matter in this case, it is up to the people of the country in question >> i'm pleased to welcome to the programmer eric cantor sir, great to have you with us this morning i love to kickoff and get your take on the latest developments around biden's response to the war in ukraine clearly biden and his team are trying to walk about his comments over the weekend calling what calls for leadership change in russia. what is your take on what's

happened >> julianna, good to be with you. i think first, it is somewhat ironic if you recall a year ago during the campaign plus with president biden's attacks on trump's remarks, this was something that was -- either it was planned or undisciplined on a world stage it is a difficult thing for the white house to clean up. as you see, they are trying to do so. in the end, julianna, i don't think it changes much as far as the progression of where things will head. as you know, president biden went into this conflict with, i think, a priority of unifying the transatlantic alliance and working with our allies here in europe and nato to present a unified front against vladimir

putin. i think he flaccomplished that. i think long term that is a very good move. however, at home, politically, it is not playing the same because poll after poll has demonstrated the american people think that biden has not done enough this comment, i think, will be in the rear-view mirror at some point and we will see what has to happen which is vladimir putin has to decide what his exit strategy is. >> what is your take on what the american people do want to see he from president biden? if you say polls suggest he is not taking a strong enough stance >> i think what you have seen over the course of the last month or plus is that every issue that has come up and the administration has taken on has been response to congressional action you talk about the ban on russian energy and central bank sanctions and removal of most

favored status on russia all this is congress president biden was trying to unify parties in europe. that takes time. the american people said we have to get tough with the autocratic thug killing tens of thousands of innocent people >> it is a difficult balance at home given the american people are already facing significant cost pressure with inflation where it is. now the prospect of higher energy prices, depending on how this plays out surely that is a difficult line for the president to address trying to take a harder stance knowing it could mean more difficulty back home >> as you know, julianna, the u.s. is much less reliant on russian oil and gas than europe. i think last year, it was 8% of our import

the reality is, it is a global marketplace. as we've seen, we already had sky high gas prices coming into the year due to the supply constraints and myriad of other reasons. now the ban here and we have record high gas prices at home over $4 a gallon nationally. i think the american consumer remains supportive of being tough on vladimir putin, but we're just in month one. so businesses, consumers, haven't begun to live with this reality that we're going to have elevated gas prices. we will have to see how that plays out on the economy and obviously in the deal market and the rest >> president biden has clearly taken a different stance with international organizations versus president trump you talked about the restoration

of nato and unity within that group over the last year or so what about the u.s. on the world stage? has the reputation been restored among other nato leaders >> i do think that and i give credit to thepresident for reinvigorating the transatlantic alliance obviously vladimir putin did much for that to come about given his brutal invasion of ukraine. so, there is, i think, now a chance to see this sort of recoalescing of the alliance i hope europe is going to step up and follow through on some of the commitments that countries like germany will make yes, we will wean off russia gas and not just rely on american security umbrella going forward.

i do think that we are at a place now where if we can see this transatlantic alliance reinvigorated with a purpose again and with unity in terms of commitment to defend europe vis-a-vis vladimir putin, i hope the next step and what president biden can do is lead the alliance of liberal order with places like russia and china >> one question. we have seen a significant uptick in market volatility on the back of the developments in ukraine. how is this impacting capital markets and corporate appetite for doing deals?

>> we have experienced a much different start to the year than we imagined and different from the landscape last year. we came in and we already had inflation setting in we already were facing the prospects of the federal reserve with interest rates and then vladimir putin injecting the tremendous amount of geopolitical risk and volatility anytime you have volatility, there is an impact what we are seeing is we are seeing especially in the mid market deals we are seeing elongation of the process. parties are taking longer to necessity negotiate the finer points again, we are seeing an i am market, but one of timing of when the deal gets done. we are seeing here in europe and

the u.s. that private sponsors have a tremendous amount of cash on hand. when they see the volatility in the public markets, it represents an opportunity for the privates to really go forward because they are in the business of transactions we maintain a ckconfident view that once volatility sub sides, we see a pick up toward the end of the year sdp >> sir, thank you for sharing your thoughts. eric cantor. coming up on "street signs." shanghai shutdown? investors watch as the chinese city enters a two-phase lockdown we'll have more after the break.

welcome back to "street signs. i'm julianna tatelbaum these are your headlines global yield spike with the gap

with the 30-year spike the boj will buy government paper. russia and rukraine prepare for peace talks today. volodymyr zelenskyy takes a harder line after signals kyiv could be ready to compromise >> priorities are known. ukraine sovereignty are beyond doubt. security guarantees are mandatory. our goal is obvious. peace and normal life of the native state as soon as possible the white house rushes to walk back the ad libbed line in the polish speech. saying it is not looking for regime change in russia. >> ukraine will never been a victory for russia for god's stake, this man cannot remain in power. and oil prices drop with pandemic and geopolitical

concerns running high. the ceo of totale plans not to do business with russia >> created a space where we are dependent? why? it was local gas it is a lesson for all of us we're about an hour into the trading session. let's look at how european equity markets are holding up. we saw retreat with the stoxx 600 breaking the two-week win streak the european market starting the week on the positive note. all regions trading higher with the dax up 1.3%. spanish and italian trading firm lag in the ftse 100.

still up 0.3%. fixed income is the focus. bond yields sky rocketed and continuing higher this morning as investors price the possibility the fed embarks on a more aggressive tightening policy than initially expected we see the u.s. yield curve on the u.s. with the gap at the 5-and 30-bonds be this morning the german 10-year bund trading at 2 basis points. and fairly muted start for the u.s. looking at a negative and contained move lower for all three indexes. the s&p 500 end 1.8% higher. the second positive week in a row. despite marketing pricing in the aggressive fed tightening path looking at a flat start for the

s&p. dow jones industrial average at 30 points lower. nasdaq expected for a 60 point drop at this stage i want to take you to the press conference under way huawei ceo is speaking in shenzhen >> has enabled us to shorten the cycle from order to revenue. in addition, as huawei has accumulated expertise, we have digital operation efficiency in 2021, our expenses dropped by nearly 10 points we see our cash flow from operating is up 69% year on

year our ratio is sound that means our revenue represents cash that can be collected. the increase of our operating cash flow directly reflects our major businesses have improved their ability to generate operating cash flows and the company is more capable of dealing with uncertainty. this will help guarantee our ability to continue investing for the future let's now look at our total assets. >> we will step away from that press conference we will continue to monitor any important lines when they come out. this is the first public ap appearance since returning to china. huawei posted the first yearly revenue decline on record as u.s. sanctions continue to bite.

profits surged amid the profitability for the tech giant. we have arjun karpul joins us great to have you on board in london the first time we're speaking. what is your take on the numbers and talk about the significance of the reappearing after being detained so long >> reporter: julianna, you mentioned this it is significant that meng is making this public appearance and leading this corporate event for the first time since return to china last year after the near three-year long extradition battle with the u.s. while detained in canada of course, this is symbolic. this is showing huawei have talked about resilience and talked about the fact they can come through u.s. sanctions and meng is delivering the press conference a testament to that

symbolic for the company i just dug into the numbers. revenue came in at $636 billion yuan down. the first yearly revenue decline since they made results public in 2002. the company is focusing on profitability and cutting down expenses that is why they saw net profits surge for the year i want to get into individual businesses we are seeing the continued impact of the u.s. sanctions huawei was thrown on the u.s. list in 2019 the u.s. sought to cut the company off from semiconductors and software you are seeing that filter through to the business as well. the consumer revenue business fell 50% year on year. that is important because of the smart phones surging and other

products that rely on chips. their business is falling revenue with 5g. this new area with cloud computing and automobiles. huawei is hiring more r & d for that division as well. when you are seeing that beginning to pay dividends that is up year over year. you are seeing the sanctions continuing to hit the business here huawei shifted focus away from the other areas like smartphones and now software and cloud computing to squeeze out other businesses this will take a long time and unscertainty remains. a tough year for huawei last year they are trying to stay resilient and push into areas to

pay dividends in the future. >> arjun, fascinating to hear how huawei is doing with the sanctions imposed. huawei's competitors have used this as an opportunity to ramp up innovation and take advantage from huawei stepping back from the global landscape how does huawei compare to their non chinese rivals >> reporter: if you look here, first, if you look at the carrier business and network business given the fact the u.s. is on a campaign to convince a number of countries not to use huawei equipment you have seen other countries go with the rivals. nokia and samsung pick up market share at this point as well. that is one area you are seeing. the other area is smartphone and gaming huawei was the number one smartphone player in the world it dropped out of the top five it is a small player now that is because it hasn't been

able to get access to high-end chips. the rivals in china pushed ahead in the chip game and other areas because huawei can't get hands on the technology that it needs. you see huawei global smartphone and others taking advantage of that and picking up the share that huawei has given up those are the two areas we are seeing at the moment where huawei is losing carrier business in smartphones. they are trying to shift to cloud computing. a competitive area with alibaba and tencent and baidu in the cloud computing game huawei knows for the business to survive in the future, it does have to put money into new areas. one of those, it sees, cloud computing and automobiles.

i think what you will see is huawei really begin to change its business and shift areas of focus into some of the areas it believes are profitable and more insulated from the sanctions we have seen as well. >> arjun, i can't help but notice this press conference is taking place in shenzhen the tech hub that went into lockdown it emerged now clearly covid is becoming increasingly problematic for president xi from huawei's perspective, how problematic are these lockdowns when it columes to the demand side >> when it comes to the manufacturing, shenzhen and the area in the province are critical for the technology we all use around the world further lockdowns and any further supply disruption could be a problem for huawei and rivals with apple and others

i think huawei at the moment, because they are shifting now toward the software driven approach to technology, they are not impacted from the lockdowns. some may impact as we push to digitalization and cloud computing. that is a shift that is under way in china as well as around the world. that is one of the themes huawei is hoping to play into at this point. digitalization of lots of industries health care as a key area and finance and a number of others i think huawei is looking the way the world is moving and this is where they can take advantage. >> arjun, great to speak with you. thank you for joining us i look forward to pspeaking to you again. in terms of china, profit growth followed other indications higher

as the situation in ukraine and growing covid cases are clouding the outlook. profits came in 5% higher on the year compared to 4.2% rise in december of the figures from january and feg bruary are combined on production figures it is the outlook everyone is concerned about. shanghai launched a two-stage lockdown splitting the city in two for nine days to allow for a staggered testing process. shanghai's eastern half followed by the western side on friday. this after the local government denied it would lockdown the 26 million residents. new figures on sunday accounted for 70% of the cases nationwide more on this on our dot-com page. coming up, we are live in paris with less than two weeks to go until the first round of the french presidential election

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welcome back to the program. total energy ceo has said he will not do business with russia's vladimir putin again. he told hadley at the doha forum that they need a role on independence on russian energy. >> we created a situation where we are dependent on them why? it was local gas it is a lesson for us. again, the more i look to the triangle, you know what makes a triangle a price. energy is a fundamental means of economy and life and why do we have crisis in europe with all of the people? because gas is high. electricity is high. so, i think all society in

europe and we favor low cost energy it is happening around the planet we impact that climate and knowing this as a cost the question which is asked how much are we ready to pay for the cost of energy security without russia we created a monster and french politic its emmanuel macron lost the lead in polls. he is still pby far the favorit to win the election. he is polling at 28% and marine le pen would get 20% according to polls charlotte is joining us live from paris with more charlotte, breakdown or flush out where things stand in the run-up to the first round.

>> reporter: julianna, today is the first official day of the campaign today, you have posters across the cities and the candidates speaking you have all of the campaign cliffs broadcast on television you will get leaflets in the post box you will have all of the rallies across the country in marseille and paris one event with the european affairs minister who is campaigning at the international events his team is campaigning for him. we will discuss one of the top concerns for french voters the cost of living and purchasing power we asked how emmanuel macron

would tackle the topic in the first round of the election. >> it remains the same which is offering the political proposal which is reforms not trying to be stuck in traditional solutions by right-wing or left-wing mo moderates. not looking at their effectiveness or efficiency. standing for topics which are out of the debate. five years ago, we were central. the topic that emmanuel macron and his team promoted as a solution for a lot of challenges we have to face. now everyone sees with the war in europe and difficulties with food, defense, energy. we need to see cooperation this is the same dna this is a crisis we have to adapt

we take on the topic of sovereignty. we have defended european sovereignty. we need to cooperate more to find right solutions for climate change and digital information and security and agriculture and this, we will have to reinvent proposals we have the platform and manifest from emmanuel macron from 2022 on how we adapt society to aging and find sustainable models and transfer on defense in europe our world has changed a lot in five years we have transformed despite the crisis we try to follow the same line. >> and the u.s. at the core of the vision and you are his european man there is still about 40% of voters today that are ready to

vote for the candidates. is it a failure of government to explain the benefits of the eu where is the skepticism coming from >> we have to face reality there is a lot of skepticism in france and across europe the populous policy using this for are their own electroral successor results. let's look at the deep reality which occurred in five years marine le pen. strongly against euro as a single currency five years ago now she says it is fine. she was mistaken now she never -- which is a lie. she changed because europe has changed. europe has changed because we changed it we changed it and convinced we need europe and we need to adapt and reform

i think it is the best route to give as europeans. look at the real situation and real approach of the french people in particular to europe when there is a crisis, they ask europe to do are more. they criticized for what they were doing and what it was not doing. coming together, in the end, bringing the european collective and economic response to the huge crisis we were facing with the recovery plan which was unthinkable two or three years ago. >> minister for european affairs speaking to charlotte in paris that is it for the show. i'm linajuan tatelbaum "worldwide exchange" is coming your way next.

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it is 5:00 a.m. in new york. here is the top five at 5:00 recession warning sign the signal for the first time in 16 years walking it back. the white house trying to water down some off script comments from the president about regime change in russia locking down again china hitting shanghai with the biggest citywide lockdown in two years. targeting billionaires the biden administration wants a new tax for the 1% of the top 1% real world drama at th