ship packages anytime anywhere for less a lot less get our special tv offer a 4-week trial plus postage and a digital scale go to stamps.com/tv and never go to the post office again good morning it's 5:00 a.m. on wall street. here owes your top "five@5." market's win streak continues, but there's a fight to keep it going. retail earnings helping to fuel the rise with additional results on deck. target and lowe's set to report today. more companies shutting factories in china as that country deals with a power crisis and growing concerns around its economic outlook.

retailer bed bath and beyond with news skyrocketing. and downplaying a new potential deal, elon musk doing what he does best. whipping up a frenzy of buying a football league. wednesday, august 17th, 2022, and you're watching "worldwide exchange" on cnbc. ♪ a very good morning to you i'm wilfred frost in for brian sullivan let's take a look. s&p was down slightly. down 0.2%. but we're looking at futures point to a negative open today the s&p yesterday did get its third straight session of gains in part because of strong results from walmart and home

depot, and we will get more retailers reporting today when we get target and lowe's, those results coming before the opening bell this morning. we also want to check in on the bond market this morning, seeing the 10-year up to about 2.8% the threshold crossed yesterday. in fact, still above that level. all the markets, crude prices recovering from a six-month of lows a fresh signal that demand remains firm a check in-in on wti trading arn that $86 mark. a check on bitcoin which has been flush the last couple of sessions moving on to asian trade this morning, a decent jump this morning. for japan, up about 1.2%

japan, hong kong, shanghai, up 0.5% yesterday there were declines off the back of the chinese gdp prints, gaining a little off the back of that germany down a bit the headline has been the inflation rate, the cpi jumping 10.1%. it's the highest since 1982. it's an uptick of the june read of 9.4% and the expectation was 9.8% month over month, we saw it slow, 0.6% that was higher than expected. lower than the previous month, but pretty high for the month of july it's usually fairly tepid in terms of month-on-month gains. the bond market, up 25 basis points to 2.4% that's the highest level since november 2008.

so pressure immediately back on the governor of the bank of england to hike once again the u.s. futures are pointing low. s&p down 0.4%. let's get you up to speed. bertha coombs is in with those for us good morning, bertha. >> good morning, wilfred so good to see you we've got two more companies closing plants in china as a power crisis worsens there toyota and contemporary amperex technology, the world's top battery maker are halting work in the region. they'll shutter until saturday the province is dependent on power. the heatwave is pushing up energy demand and degreeing down reservoirs. twitter is trying to get

musk's texts according to "business insider," twitter wants a search conducted of all of muvg's messages during the relevant period for material related to its lawsuit the report says the proposed order does not specify exactly when that relevant period is, and many documents in the case so far have been filed confidentially. and the federal reserve issuing more guidance for banks involving cryptos. regulators telling firms they need to make sure there are systems in place before taking on the digital assets to make sure they don't threaten safety and consumer protection given the volatility the banks should notify the fed before engaging in any crypto-related activity, and any banks that jumped into the crypto space should notify the fed about their involvement.

so far, wilf, a lot of banks have been cautious about that. if you try to trade on your bank's platform, they really don't let you do that. >> absolutely. interesting you put in one of the elon musk stories there. i know we're going to cover the other one, which is my favorite one of the morning at 5:30 i look forward to that discussion until then, bertha coombs, thank you so much. >> never enough musk. >> retail providing fresh momentum, suggesting an easing of negative sentiment, but that momentum facing fresh questions out of china and u.s. manufacturing figures as well. let's talk more about all of this with chuck self, chief in vestment strategist. good morning to you. >> good morning. >> yesterday we got a decent change in tone from walmart

albeit from fairly low expectations is that the story for the moment with the markets we've got less bad news as opposed to outride good news >> well, yes housing was down big time. housing is one of the leading indicators for the economy within the discretionary sector, we've got companies very much economy-oriented and some of those that are not and no matter what happens, people need to shop at walmart and even home depot is susceptible to being able to run well with the economy slowing down so we're going to continue seeing mixed news because even though the economy has recovered somewhat, the fed is pounding the economy down with its rise in interest rates to try to

decrease inflation. >> do you think that that's appropriately priced into markets, or do you think the markets have gotten ahead of themselves with the extent to which the fed is going to be able to ease off that tightening path >> i came from the mixed income side of the world, so i believe the bond market usually tells you the truth. the big inversion in the curve, one of the largest we've seen in a long time tells you that the stockmarket's probably ahead of itself, running while you have such a large inversion in the 0.2 curve, so we think the bond market has a right that the fed is going to be raising interest rates and they're going to continue to raise it until they really beat down inflation, whereas, the stockmarket is looking way beyond that. we don't think in 2023 there's going to be a decrease in the fed funds rate, and so we

believe the market's a little ahead of itself. >> so the broader market is a little ahead of itself but i know there's a couple of stocks you do want to talk about. talk about why you bar visa? >> we believe in technology generally as a growth area when you have an economic slowdown, and we think that all recessions are different from each other. this one will be different in that consumers will be very picky on what they spend on. and what they want to spend on is travel. all you have do is get on planes these days and lose your luggage like i did, and you can tell there's a lot of travel going on and so visa is a major beneficiary of that. >> and then eli lilly? >> yeah. eli lilly is our number one health care pick they have this great diabetes franchise that has usually made

it a higher in sector evaluation, and now it's about at the sector valuation, and so we think especially long-term investors should be buying eli lilly here so that they can continue to participate in what's unfortunately a growth industry, diabetes >> chuck self, thanks so much for joining me this morning. very much appreciated. we're going to head to break now. futures are pointing to a negative open, down 0 president 0.4% and we have the big money movies and why retailers are continuing push beyond.

welcome back to "worldwide exchange." it's time for your big money movers first up, bebath and beyond, the meme stock up again after as much as 70% yesterday before closing about 30% higher on the day. retail traders active on social media are piling in as board member ryan cohen is talking it's even as analysts warn about the company's valuation given its liquidity levels

it's extended hours up after that 30% rise yesterday. extraordinary 103% in a week let's move on to the next stock. we've got a lawsuit for the heartburn drug zantac, which relates to gsk the plaintiff in the first lawsuit has dropped its case the trial was set to begin next week in illinois, and the plaintiff alleged he developed cancer from taking the over-the-counter drug. the fda pulled zantac from the u.s. market in 2020. it's dropped 1.7%. let's move on to the next story if we can move on. am amazon's warehouse in upstate albany, new york, has filed a halt on an election.

it won a historic victory in staten island in april, making it the first amazon warehouse in the u.s. to unionize the stocks down in premarket, really in line with nasdaq finally tencent reporting its first ever drop in quarterly revenue. the gaming platform was hurt, limiting playing time and covid lockdowns and that all hurt the stock. but it's essentially flat in hong kong today. now to the latest developments over simmering tensions around taiwan china's ambassador to the u.s. warning washington that beijing will be putting on arms sales. the chinese officials call on the country's richest est prov

to offer economic data showing slowdown in consumption and output in july for more let's bring in the managing director and senior policy analyst as long view global, also a cnbc contributor. a very good morning to you good to see you. the first question t gdp number, which disappointed many, was it that bad? we'd be killing for it in the uk at the moment, i'm sure in the u.s. too. >> good morning, wilf. i think it's important to put it into context china really needs about 5%, 5.5% growth to do all the things it needs to do to keep its economy running and its people employed, something we can get to in a bit. while you're correct, 2.5% for most is not that bad, but for china, 2.5% is a significant slowdown and certainly it's far from the expectations that they

set themselves back in march, which was a growth projection of 5.5% but, wilf, this is an economy that is really showing signss of trouble. two signs that concerned me. one is the 9.9 youth unemployment rate, ages 16 to 24 that's a real problem for xi jinping over the long term, wilf what they're looking to do to fix this problem doesn't convince me this is the right medicine for all that ills china's economy. they resorted to the old playbook, wilf, of putting a lot of money into infrastructure development, but that's not going to help those numbers that we see for youth employment. >> and so what's likely to happen here? i mean any economy that's relied on excessively strong growth rates when things start to turn, the fear is does it collapse totally when you no longer have

the supportive tailwind of super normal growth? is that likely are we going to see a total collapse or is this a temporary pullback? >> i think the real question is how much is covid-related. there's been a lot of talk about what zero covid has done i think there's a lot of truth to that. but there's also a lot of policy we say missteps. it may be intentionally what xi jinping tends to do, but things like pulling back on as you introduced the segment on the tech segment so a lot of those youth who are going to be employed were previously employed in tech in the gig economy. i'm not sure after we get beyond the covid situation structurally china's policies and its economy is designed to really meet what i consider to be the new normal for china's economy. >> and to what extent does this

slightly softer economic outlook hurt president xi jinping's political standing we've always thought of him as all powerful over the last few years. is that changing at all or not really >> i don't think the power is changing again, i often say i think there may be some pause with him with respect to the policy direction, at least in the short term but i think we should think that xi jinping is pretty assured that third term he's looking for. one sign of that, wilf, there are already discussions about them traveling in the fall for southeast asia for the g20 and apec and a meeting with biden. that to me says he feels pretty secure in his position going forward. >> finally, tensions as it relates to taiwan with the u, do you think those have at least peaked in the short term, even

if not solved for the long term? >> i hope so if you look at what the chinese response was with the senator visit, we saw about 30 warships, five warplanes that exercised from china so that is certainly a step, about half of what we saw with nancy pelosi so we are seeing some modulation in terms of response, which says to me that china is looking to try and control what has been an escalatory ladder here but i think it's a short-term issue. taiwan is a long-term core interest of china, so it's not going away but i am fairly confident that we're beyond the worst of what we've seen in terms of exercises in response to the trips that have been taken to taiwan. >> as always, a pleasure thanks so much for joining me here on "worldwide exchange." still on deck here, meta platform's outlining its

strategy to stop the spread of its disinformation ahead of the midterm elections. the step the social media giant plans toak te when we begin with the futures pointing to 0.4% on the s&p. >> announcer: this cnbc program is sponsored by ibm. ibm. let's create s all on different systems. you need to pull it together. so you call in ibm and red hat to create an open hybrid cloud platform. now data is available anywhere, securely. and your digital transformation is helping find new ways to unlock energy around the world.

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exchange." several states held key closely watched primaries yesterday, and a high-profile critic of former president trump, liz cheney, facing a swift defeat in the fight to keep her house seat nbc's susan mcginnis joins us from washington with more on that good morning, susan. >> hi, good morning, wilf. that's right wyoming congresswoman liz cheney may have been hoping for votes from democrats, but if they did vote for her, it wasn't enough wyoming congresswoman liz cheney suffering a brew ta but not unexpect loss >> i love what our party stood for, but i love my country more. >> reporter: losing her seat to trump-backed harriet hageman who supports trump's claims that the 2020 election was stolen

hageman winning in a landslide, more confirmation of trump's stranglehold on the gop despite multiple investigations surrounding him. cheney says she'll serve out her term and continue her fight. >> i'll do whatever it takes to ensure that donald trump is never again anywhere near the oval office. >> reporter: the buzz growing louder about a paz prossible presidential cheney run. lisa murkowski a projected winner the a race. >> i hope we do not become the party of donald trump. >> and sarah palin advancing her seat and president biden signing the inflation reduction act into law. the sweeping package covering climate, health care, and much more of the democrats' agenda. republicans warn wasteful spending will not reduce inflation.

he's enjoying one of his presidential victories the cabinet plans to start traveling over the next few weeks to tell voters the benefits of this new inflation law. wilf >> susan, thanks for that.fphil. rudy juul janne is expected to testify in georgia where a special grand jury is looking to overturn the efforts in the 2020 election he's now a target in that probe and it's unlikely he'll answer questions about his former client in an nbc news exclusive, boston children's hospital is warning employees of increasingly aggressive harassment by far

right activists making false claiming up the treatment of young transgender people one allegation said the hospital offered gender affirmed hysterectomies to children under 18 conservative influencers with millions of followers have pushed similar false narratives, which has added to fuel to the fire boston's children hospital says it condemns the the attacks and is working with law enforcement to hold them accountable serena williams was in action on tuesday as her evolution from tennis fast approaches williams was greeted with cheers in cincinnati, but it was a tough match. defending u.s. open champion emma raducanu beat williams in six straight sets. williams implied she would wrap

up her playing career in less than two weeks it looks like she's down to just one more tournament. >> and i'm very sorry to see that loss for serena, but as a brit, i'm delighted to see emma win. still on deck t biden administration stepping in on the labor dispute and the american supply chain. we'll have the latest on that coming up. just a reminder futures pointing low this morning, bybo 0 aut president 5% on the nasdaq we'll be right back. when hurting feet make you want to stop, it's dr. scholl's time. our custom fit orthotics use foot mapping technology to give you personalized support, for all-day pain relief. find your relief in store or online.

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welcome back to "worldwide exchange." a fifthet straight day of gains. could another round of retail earnings provide another boost for the markets? target and lowe's are on deck. >> and elon musk looking to make another deal potentially, up late tweeting about a potential bid for one of the world east most valuable sports teams it's wednesday, august 17th. you're watching "worldwide exchange" on cnbc. ♪ welcome back to "worldwide exchange." i'm wilfred frost in for brian sullivan this morning.

let's check in on the futures borksd which are pointing to a lower mark a third positive in the row for the s&p. the s&p is up 0.2% the nasdaq was lower, but only by 0.2%. there's the futures board. all three of the majors expected to open low. about a quarter of a percent, a little bit more for than for the s&p and nasdaq s&p by 0.4%, the nasdaq by 0.5%. yesterday the 10-year rose above 2.8% currently at 2.86% the euro is rising as well the uk yield in particular spiking to the highest level the 2-year since november 2008 after a very strong inflation print. double digitses 10.1%.

the short end of the u.s. also rising 2.3 on the oil prices wti has been pulling back of late, around $86 per barrel last time i checked $86.50 and flat this morning >> let's check in on some of your top story this morning. bertha coombs joins us once again with those hey, bertha. >> hey, wilf meta platforms is reportedly outlining how it plans to prevent the spread of disinformation ahead of the elections in the u.s they'll focus on political ads with plans to disable them on the various platforms in the weeks before the november 8th contest. the report says ads that run before the blackout period will continue to run, but they will disable them during that time, including any changes to who they target. meta reiterated it will not

allow any posts or ads that mitt represent key details about the vote progress says. the biden administration is stepping into the fight between major freight railroads and unions over contract negotiationses, that according to reuters they're proposed a wage increase between 4% and 7% through 2024 that report also says it's calling for retroactive pay hooic hikes for 2020 along with annual bonuses and more days off. talks between the top railways, representing 115,000 workers, talks have dragged out for more than two years now. and this is the story that wilf has been wanting to talk about all morning, elon musk now throwing cold water on top of a

potential sports deal that he started, musk tweeting that he was going to buy the soccer team manchester united. that sent twitter into a frenzy, as you can imagine, whether he was serious or number he jumped back on twitter to say he was not, and his comment was a long-running joke that he had no plans to buy any sports teams. but, you know, looking at man u's market cap, wilf, that would be like pocket change for him. it would only be $2 billion. >> exactly market cap's $2 billion. it's up a little bit 3.7% it's up a bit over the last month or so. it's famously a liquid since it listed the glacier family control the company. i'd love to say, you know, we should warn him off. this it would be the worst possible buy manchester united is an awful club i do kind of hate them if i'm honest but i guess we have to be

impartial when it comes to sports teams the reach is massive as you consider the $2 billion market cap, it's relatively small compared to the 4, 5, $6 billion that gets quoted for nfl franchises the thing we have to mention is that possibility, however small, are being relegated from the top competition. nfl values would be way lower if you fall out of the competition altogether the risk of doing that is tiny, but after just two game this season, they are bottom of the league which is a joy to see. >> no offense to the man u fans out there. >> no offense to the man u fans. i think they'll understand that one is allowed to do this occasionally impartial on all other topics, not when it comes to premier league soccer.

bertha, thank you so much. a shame for man u fans i think they'd like to see a change in ownership even if it was something volatile bertha, thank you. let's get back to earnings results. target and lowe's on deck following yesterday's better-than-expected numbers from rivals walmart and home depot. let's discuss those a little bit more target sales and profit warned in june it was hurting it shows how much more they need to discount to clear out older merchandise. joining me now is scott chicarielli who is a research analyst. a very good morning to you first and foremost, how about with walmart yesterday in fact, is the u.s. consumer

stronger than expected >> well, wilf, thank you for having me on what i would say is i think the end of the month or i should say end of the quarter, july ended up turning out a lot better than anticipated. i think it came out better than originally anticipated >> does that same rule apply to target. >> they lowered their expectations pretty meema tourly, so i would expect a similar general pattern. we heard from home depot, and they talked about strong sales throughout one of the things i think is happening with the u.s. consumer is not all consumers are created equal. you have a large bifurcation

you have food inflation, gas inflachlgt infl inflation. if you're a homeowner and have built up equity values and they've tripled in the last ten years, you're feeling better about that financial situation that's a real phenomena for the consumer psychology. >> and so how does that relate specifically to home depot and lowe's because i'm guessing a lot of people were hoping prices wouldn't peak or rise as much as they have. does that hurt home depot and lowe's or is it a slight beneficiary if they're not able to change? >> it's more of the latter

housing turnover will be lower you may be the person who needs extra room you have a young growing family, whatever the scenario is what you may wind up doing is facing the one you have. i think that's a big phenomena when you look at the homes in the u.s. today, something like 90% to 95% of all mortgages are fixed at relatively low rates. i think the vast majority are 4% or lower as a result, with the fed raising rates, it doesn't blow up your monthly payment. that's very different than what we saw in '07 or '08, people were taking significant risk you have a person owning seven rental properties, couldn't really afford that, et cetera. >> i know you're a buyer of home depot. talk us through which of the other three we've been discussing, walmart, target, and lowe's, do you think is a buy?

>> my preference is the home improvement segment. so we are recommending both home depot and lowe's at this stage we're more on the neutral camp for target and walmart one of the simple facts that's happening in home improvement and unique to their area, auto parts and others, is you have these inflation numbers flowing through your p & l you were selling a wimt for $1 and now 1.10%, if i can homeland my margins, i have 10% growth product growth that's a phenomena that i think will be more difficult for the mass merchants to be able to hold onto if you have people trading from a private label or higher cut meats to lower cut

meats or walmart talked about it yesterday, deli meats like hot dogs, et cetera. you just doan sdon't see that same phenomena. >> scot, thank you. still coming up on "worldwide exchange," fresh concerns and supply snags. the issues coming straight to you. "worldwide exchange" back in a couple

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welcome back two of the united states key trade routes are making challenges, making an existing problem even worse we're joined now with the details on this. a very good morning to you, gloria. >> good morning, wilf. the u.s. supply chain can't catch a break. the situation at the german ports is getting worse after the port negotiations failed to reach an agreement if know agreement comes by the august 22nd deadline, it will spill into the first quarter of 2023 unfortunately the labor strife is growing in the uk on august 21st, an eight-day

strike will begin. reviewing the lists there's whiskey, breakfast cereals for kellogg's. medical supplies pork supplies. we're also adding liverpool to the strike watch list as 500 dockworkers recently voted in favor of a strike. now let's head over to hina. the cnbc china supply chain heat map shows the continued strain of covid on truck drivers which continues to slow down the movement of raw materials and exports. adding to that time crunch, the government plans power cuts as a result of the record-high temperatures some manufacturers in 19 cities have been ordered to shut down production for six days. intel and apple have manufacturing plants in those impacted areas the region is a hub for lithium

battery manufacturing and solar sales. remember, playing catch-up for any delays of manufacturing and port closures takes weeks, not days wilf >> lori ann, that's interesting. it's difficult seeing the heat mack look so much worse in europe and asia as well. in terms of the u.s. ports that have had their own share of congestion, how are things looking there? >> things are pretty much status quo. the port of oakland tells cnbc they're still clearing out last month's containers, and looking at the u.s. supply chain heat map, the u.s. has the longest wait time for port containers. sitting at the ports are empty wood barrels, numerous containers filled with auto parks, melissa and doug puzzles. flooring, and wine. >> lori ann, thank you so much

much appreciated. still to come, the recent rally potentially at risk. we've got futures pointing low and more on deck, especially from the retailers what to watch in the trading day ahead.

welcome back to "worldwide exchange." time to look at a busy day ahead for investors with two key pieces of economic data out this morning. at 8:30 a.m. eastern time, we'll get you live retail sales followed by june business industries at 10:00. at 2:00 p.m. we get the minutes from the fed's latest policy meeting, and earnings on deck from target and lowe's at the open cisco reporting after the close. what should investors be thinking about today?

i'll come to you first of all. do you think it's bounced too far, too fast? >> great to see you this morning. that's a great question. one of the reasons we see the bounce is we're seeing the market pricing in more easing with the fed, and i think that's -- it might be too early on that that might be where you get too far, too fast. one good thing during that rally, we saw the earnings stay pat. i think that's why you're seeing relief going forward seeing what happens in september is going to be big for investors to decide if we're going to be pushing higher >> in terms, patrick, of where valuations are at and various comparisons, one pointed out to

me yesterday, which is that the dividend yield of the s&p 500 is back to where it was in march. it's fallen again as equities have rallied, yet the 10-year yield t comparative alternative, has soared does that suggest it's overvalued again. >> certainly not i think to put it into context, we started the year at 20.5 times. what happened is interest rates grew that brings things back in line with long-term averages. it's going to remain healthy in next couple of quarters. we don't think it's going to be extended with technology removed where investors typically look for for the strong return.

absolutely not we don't see valuations extend here. >> clearly this earning season has been at least less bad than feared, patrick, but from here, you forecast that the next couple of quarters we'll see earnings upgrards, not downgrades >> well, we think growth remain as plus. i think what that does is takes away from the fact we're still seeing a very strong economic backdrop we're going to see revenues remain strong, running in the high double digits, and we're going to see profits remain -- they're going to hold in there's a bit of margin pressure let's call it what it is we're not going to see that significant rollover, which was feared we do not see that with the current data. >> delano, in terms of the earnings we saw yesterday on the consumer side, obviously more to

come today, do you think that suggests the u.s. will support the economy and avoid a recession coming through, or is that still going to arrive >> you know, i think that's the hope right now we're still seeing spending obviously, you know, different baskets, and it's kind of bifurcated between family income as you said, we're seeing consumers take on debt we may be in a situation where we push to lower lows as we see companies, you know, obviously start to change their earning projections on that we're really focused that data because it's going to have a very interesting pull for what's going forward. >> and, delano, if we look at it right now, the s&p 500 at yesterday's close is about 11% from its record highs. remarkable that we're back at that level what do you think is more likely in the course of the rest of

this year, that we break into record-highs once again or we retest the june lows >> you know, i think what's likely for us for the rest of the year, there's a key level we're looking to break through on the 200-day moving average. i think if we break through that, there's a high point we'll break through that remarkable for what we saw year to date earlier this year. it could be priced in we break to those levels and that we potentially see higher highs >> patrick s there a risk to your outlook that rates continue to go up from the fed if expected if we saw another 75 basis point this year, albeit a little more spread out would that make it more bearish or not >> i think the question is what is the market expecting. i think we're expecting or at least the market's expecting a rate of around 3.5 to $3.75 by the time we get to next year

the expectation is a continuing ramp in fed policy to fight inflation. right now the most recent cpi high rating has seen the peak. if not, we're in the process as long as the cpi continues to come down, i think it gives hope the market will continue to move higher as we begin to match the policy against the decline in inflation. i think that's really key. and that will allow evaluations to expand. because they suffered as interest rates rose, to your point earlier. we don't think the fear the fed's going to cause and runs away will likely cause a problem. >> we'll have to leave it there. thank you for joining us, patrick and delano the dnasdaq is down as we alls

s&p 500. that does it for "worldwide exchange." "squawk box" is next it's time for the biggest sale of the year, on the sleep number 360 smart bed. snoring? it can gently raise your partner's head to help. our smart sleepers get 28 minutes more restful sleep per night. all smart beds are on sale. save 50% on the sleep number 360 limited edition smart bed. only for a limited time.

good morning retail focus again we'll hear from target and lowe's in a minute bed bath and beyond is soaring again. as much as 70% yesterday we'll tell you what's behind the flurry. and congresswoman liz cheney losing by a landslide, defeated by a challenger in the republican primary we're going to wrap up this morning's big political stories and what they mean for the economy. it is wednesday, august 17th, 2022 "squawk box" begins right now. ♪

good morning, everybody. welcome to "squawk box" here on cnbc we're live from the nasdaq market site in times square. i'm becky quick along with andrew ross sorkin good to see you zbheen good to see you. it's been a while. >> like ships in the night. >> ships in the night. if you take a look at this hour, you will see red arrows across the board the s&p futures off by 22 and the nasdaq off by 87 this comes after another strong day at least for most of the markets. the dow yesterday did have its first five-day winning streak. s&p was up but th