and hurricane ian slamming into florida as a category 4 storm leaving 2 million without power as it churns up north. bucking the trend as one of

the world's largest carmakers with a test driver ipo in what has been a slow year for ipo historic night in the world of sports. major league baseball as slugger aaron judge hits into the record books. it is thursday, september 29th, 2022 you are watching "worldwide exchange." here on cnbc good morning i'm frank holland in for brian sullivan let's kick off thursday morning with the check of u.s. stock futures. the come back with the dow surge 600 points snapping a six-session losing streak the dow could open up 300 points lower. at least this point, the s&p and nasdaq 1% lower at this time we saw wild moves in the bond market with u.s. treasuries

falling from the highest level in more than a decade on the heels of the bank of england decision to launch a bond buying program. 10-year yield coming off the biggest session drop since 2009. this morning, below that 4% mark still the inverted yield curve here we want to keep our eye on oil a boost yesterday when it was down wti at $81 a barrel. brent crude at $88 a barrel. in crypto, bitcoin and ethereum and xrp is higher. bitcoin and ethereum lower xrp up about 30% over the last month. something to watch there let's get a check of the trading in europe and a closer look at what is next for the boe. we go to julianna tatelbaum in the london newsroom. good morning, julianna >> frank, good morning kicking off with equity markets.

we have seen reversal of the rally that caming te together ln the day yesterday. all majors in europe trading lower and sectors. particularly heavy selling in cyclical parts of the market it is really broad based 1.5% lower for every single index in europe. ftse 100 is down 1.5%. we saw more serious under performance in that market earlier this morning now losses all of this as the fiscal fallout continues in the uk. sterling assets selling off sharply. reversing the moves from yesterday. the bank of england took emergency action to calm bond markets as you suggested there unleashing a 65 billion pound bond buying program. this morning, the uk government is talking and defending fiscal plans showing no remorse after the market turmoil after the wake of the mini budget delivered last friday. liz truss saying it is not the

time to reverse the budget now coming on to the next steps for the bank of england, the next scheduled meeting is in early november analysts and economists across the street are wondering if we will see an emergency rate hike before then. if we see continued movement in the pound. the market at the moment is looking at an emergency rate hike the question is how big is the hike as for sterling, we have sterling down .70% against the dollar we were trading off 1% earlier 108 is the level we he is reversal of the gilt market what is happening in the uk matters not for this country, but europe this is something that global policymakers are watching. frank. >> julianna, thank you for the latest let's get a check on the top corporate stories with bertha

coombs good morning, bertha >> good morning, frank a developing story in europe the swedish coast guard recore reporting a leak on the nord stream 1 and nord stream 2 pipelines bringing the damaged sections to four natural gas has been bubbling up from the baltic sea for a week now with governments calling the actions deliberate and sabotage saying only a state could carry out an act. and tesla is adding billionaire joe gebbia to the board of directors this follows the departure of larry ellison this past august tesla added ellison and the executive kathleen wilson to the board back in 2018 to comply with the s.e.c. settlement over alleged civil securities fraud.

and chevron sold its california headquarters and plans to move into a nearby leased space about the third of the size of the coverage offices. the move could inn sides with the location to texas. che chevron's main office has been in california for 140 years dating back to pacific coast oil company established its headquarters in the bay area back in 1879 i was not around then, frank back to you. >> bertha, good morning. see you later on. turning attention back to the broader markets. stocks are said to give back yesterday's gains if the pre-market losses hold futures as you can see red across the board dow looks like it will open 300 points lower and nasdaq and s&p 500 will open later. we have robter er robert schen

with us for more we could give back all of those gains. what are you telling clients today? >> we are in the middle of the bear market. we are seeing that play out overnight. the bank of england obviously is making emergency measures to support what they need to do in the currency it is about the strong dollar here in the united states. supported by the federal reserve. the fed reserve here has been res resolute they can't be off policy they have to be hawkish. we are seeing that ripple effect with the trade we are advising clients and asset allocating appropriately we have cash on the sidelines. we will chase the market, but let the market take advantage of it when it comes to us. >> you are not chasing the market, but telling clients to

change investment objectives with the volatility. run it down for a second we are about to enter october and november a volatile time for risk assets. we don't know how high the fed will move rates. when you say change investment objectives, what does it mean for the near term and long term? >> we were always taking a long term view for clients. if you look at september, october and even november, especially in the midterm cycle, markets tend to sell off and almost weak at this point in time that being said, there is still an opportunity here that come our way. we are seeing that in every market we will keep our powder dry. we know the fed will continue to be resolute. we are seeing that play out. we are seeing the conversation shift from inflation now to recession. that's actually going to play

out over the month of october. we will see it in the employment data the fed will look at the employment data as we are. the focus needs to be on earnings and corporate earnings moving forward we think the geopolitical headlines and the headlines we're seeing right now are going to come into full bear full focus with the third quarter earnings expectations have come down. corporations can exceed the expectations >> robert, quickly let's get to the stock picks you have three of them costco inflation impacting costco or people worried people are stocking up and they need food and drinks >> costco is recession proof consumers will continue to flock to costco. we like costco next year, they will increase membership that is $400 million to the bottom line by membership increase during recession, costco is a

proven winner. >> the other two briefly >> we also like verizon even in recession. people give up mortgages before cell phone it has a 6% yield. you get paid while you wait. amazon amazon cloud will continue to grow it is growing at 35% clip. $6 billion per quarter at same time, consolidated last couple years we believe amazon is a winner. >> we have to leave it there robert, we appreciate the i ins insight. thank you. turning our attention to a developing story florida reeling from the impact of hurricane ian slamming the west coast as a category 4 storm before weakening to the category 1 with the maximum winds of 75 miles an hour. this the live shot of daytona beach. the storm knocking out 2 million customers this morning and dealing a serious blow to

transportation it 2,100 flights cancels jacksonville on the atlantic c coast joining the tampa coast in shutting down. president biden will get an update on the damage for that, we go to brie jackson in washington. >> reporter: good morning, frank. the white house is keeping a close eye on the situation president biden will be briefed on the federal response during his meeting at pefema later tody president biden believes the storm may turn out to be the most consequential hurricane in a long time. hurricane ian slamming florida flooding roads, knocking out power to millions and wrecking havoc on people's lives. >> i screwed up. i got to do with the reality which is get the hell out of the house. >> it's my home. it's the only thing i have

i mean, my mother. you know what i mean if that goes, then what do you do >> reporter: ian made landfall as a category 4 storm. the fifth strongest in u.s. history. war ending an all-hands on deck response including 30,000 linesmen and 76,000 national guard troops and 1,600 high water vehicles for rescue efforts >> this level of coordination will not stop. as we prepare for the historic and catastrophic impacts we are already beginning to see >> reporter: president biden continues to keep a close eye on the storm and says long-term assistance will also be available. >> when with the storm passes, the federal government will be there to help you recover. >> reporter: congress is passing legislation for aid. >> the funding bill is on track

to pass this week. it will ensure the disaster relief fund is fully resourced >> reporter: with ian continuing on the destructive path, governors in southeastern states are now declaring a state of emergency. president biden also warned oil and gas companies against increasing prices. a spokesperson for the american petroleum institute pushed back saying prices are determined by market forces, not individual companies. frank. >> brie jackson. thank you. when we return to "worldwide exchange." a check on the biggest ipo in history. we are live in frankfurt with the trade. and rate shock as investors are die ggesting the latest fro the bank of england. and more on hurricane ian as it is downgraded to a tropical

storm. cklive report from tampa on de a very busy hour when "worldwide exchange" returns. with powerful, easy-to-use tools power e*trade makes complex trading easier react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity

welcome back to "worldwide exchange." shares are popping in the european market debut after a slow year for the public of off offering we are live from frankfurt with annette weisbach >> reporter: it is the largest

ipo on the ground here in europe the porsche shares are popping despite the weak general market environment. it is also down to the fact that the families, porsche and ph, controlling volkswagen and porsche did not want the maximum price. it is a complex deal structure in which they had to buy shares and forced to keep the price at bay. that is why we are seeing that very friendly market reaction. shares were over subscribed a couple of times. loads of interest because the porsche story is an equity story. it is very appealing to investors. porsche has a very high profit margin roughly 90%. roughly double bmw we see the market cap approaching 75 billion euro for porsche. volkswagen has a market cap of

84 to give you an idea of how much value creation has taken place with the ipo now volkswagen can invest proceeds in the electric strategy and also get a special dividend to the preferred shareholders at the same time, they will invest in battery factories. porsche will expand the balance sheet and invest more in electric fleet behind me, you are seeing a selection of the iconic vehicles which draw a lot of attention from the crowds here in frankfurt. >> annette, we see the showares here you spoke with executives. any take away from the conversation >> reporter: it is interesting they are criticized for the dual governance structure the ceo of porsche as well as the ceo of volkswagen insisting

on staying on top of both companies. he is looking at porsche as a brand. that was an interesting take away at the same time, volkswagen is confident they are weathering the recession storm which we are going to witness here in europe a lot sooner than you in the united states. they are confident also about china and despite the slowing of the economy. in general, positive news coming from both companies. >> strong debut for the ipo. shares up more than 4.5% annette weisbach, thank you. still on deck, the decision makers in world give cnbc a look at the fourth quarter. you will only e he seiteron cnbc stay with us

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welcome back to "worldwide exchange." now for a look at the q3 global survey the third of the cfos say 33% choose when they work from home or office. you can see here just about 25% say workers have to be in the office on specific days, but be in the office less than five days more than 25% say the workers choose the days they come in, but still less than five days.

as you see, a small percent. 5% mandate in the office and this is a factor in the tight labor market at the same time, companies are word about productivity. many companies are hiring and expect head count to increase. you see 57%. one-third expect head count to remain the same. 10% expect to see a reduction in their labor force. this general optimism of the work force comes as mixed opinions of the biggest issue for companies. inflation. 57% say inflation just hasn't peaked the graph over here. we'll get more insight on friday, of course, from the latest pce report. at the same time, majority of the cfos say rates will stay just about the same level in recent days with the 10-year treasury with a 14-year high at

14%. almost two-thirds of the cfos here say the yield on the 10-year treasury will finish between 4% and 4.5%. 29% between 3.5% and 3.9%. very important to note, none of the cfos see it falling below 3% we asked about the mid-term elections in november. you see 57% say republicans win the house and democrats retain control of the senate. 19% say gop takes control of both chambers. 10% say republicans take control of the senate and democrats control of the house a lot to watch and minds on the financial decision makers. still ahead, we are live outside the bank of england to see what is next for the currency and what it means for are your portfolio

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stocks set to reverse course after yesterday's massive relief rally. however, futures are pointing to a lower open and ken griffin told cnbc at the alpha conference and tracking hurricane ian through florida. a live report from the region ahead. it is thursday, september 29th, 2022 you are watch wing "worldwide

exchange" here on cnbc >> welcome back. i'm frank holland in for brian sullivan it is 5:30 a.m. on the east coast. here is how stock futures are looking. red across the board dow could open up 200 points lower at the open. the s&p and nasdaq around 1% lower at this time let's get to the top stories bertha coombs is back with those. >> good morning, frank so amazon is raising pay for hourly workers again as the company prepares for the holiday shopping season and a second prime day event next month in october. amazon will increase average starting pay for frontline warehouse workers up to $19 an hour many earn between $16 and $26 depending the their location

amazon raised pay a year ago to $18 an average an hour amazon is spending $1 billion on the pay hikes over the next year. several major advertisers including mazda, forbes or pbs kids have removed ads from twitter. that's because they appeared alongside tweets soliciting child porn the company has zero tolerance for sexual exploitation and twitter is working with advertising clients to investigate and take action to prevent this from happening again. warner bros. discovery is facing a lawsuit alleging false statements of the health of hbo max and subscriber numbers the suit seeking class action status filed last week in new

york federal court since the merger, warner bros. and discovery closed in april, it is not a pretty chart the stock down 50% shares dropped last month when the company reported a $3.4 billion second quarter loss due partly to costs related to the merger frank. >> continued issues for hbo max. "house of the dragon" show is really great >> i haven't gotten into it yet. it is addictive. i like actually a show called "ru "rutherford falls" on peacock. >> it is our nbc subsidiary. we have to throw that out there. >> i know. thank you, bertha coombs the fallout from the bank of england decision to launch a

bond buying program to shore up investor confidence. not everyone is convinced it is on the right track here is the latest from ken griffin from yesterday's delivering alpha conference. >> it represents the first time we see a major developed market in a very long time lose confidence from investors. when you have the fiscal house in order and inflation under control, you have degrees of freedom to deal with moments of adversity. the uk lost the degree of freedom. >> and joining me now outside the bank of england is joumanna bercetche. good morning >> reporter: good morning, frank. i think it is important to dissect what came from the bank of england yesterday because they acted in the name of financial stability, not in the

name of monetary policy. they intervened and announced they would buy up gilt after the announcement on friday, we saw a sell off moving 100 basis points in two days unprecedented action which is impacting the pension fund community. they started to receive margin calls. the bank of england needed to stop that. that is why they announced the asset bond buying program that puts them at odds with the qt program announced by bank of england by the committee the reaction, you could say, was in line with what they expected. gilt yields dropped 100 basis points in trading yesterday. we saw support from the pound, but it is struggling since the overriding theme is one of confidence investor confidence in uk assets with the fiscal situation and

deteriorating public finances outlook. >> a lot going on in england what is the next thing investors should look for? is there a next shoe that could drop here? >> reporter: i think there are two major data points. the first is the next scheduled bank of england meeting on november 3rd they are predicting 30 basis points of hikes. they delivered only 50 there is a pressure to deliver more the second date point is november 23rd. the second opportunity to announce the budget. there is some expectation they will comment more on how they reduce the debt-to-gtp profile tying in to investor confidence. that is what the market needs to see. they need to get reassurance that the government understands the debt and borrowing plans they put out has spooked investors. they want to see the numbers will be on the path to come back

down again in coming years those things together could be major drivers for where this market goes from here. of course, between now and november, there is a lot of time the market is still pricing the possibility of an inter meeting hike from the bank of england. there could be more fun and games, frank >> i don't think so, but a lot of action. joumanna, thank you. let's stay on bonds and go state side with the benchmark 10-year treasury the steepest one day drop since 2009 after spiking above 4% in the day. it is sitting above 3.8% for more on what this means for the markets and your money, let's bring in jason hunter with jpmorgan chase >> thank you, frank. >> jason, i want to get your take on the 10-year treasury hit 4% now it has dropped dramatically. closed down 20 basis points

lower than the 4% yield mark what does that mean for the bond market >> before the price we have seen with the aftermath of what is going on in the uk markets, as the 10-year treasury was approaching 3.50 and the long bond at 3.50, we thought there was a good chance the market seeing high yields for the medium term, but the cycle sentiment measures were getting stretched. deep into oversold territory for the bond market. conditions that tend to line up with reheversal we are waiting for deceleration and the price action or sharp reversal you certainly were caught by surprised by the aftermath of what is going on in the uk which is how high yields have gotten there is a sign of a blow off top in yields as you mentioned with the reversal from 4%. we need to see further price action and bullish volatility

confirm that there are signs of that. >> you are saying a blow off top. i have to ask in plain language. i know you don't have a crystal ball there have been a lot of surprises this year. where do you see this yield going? can it top 4% this year? where do you see the bottom? >> so, so, the idea of the blow top and you see reversals. there are two reversals in the bond market. a more orderly one where the trend decelerates and price is based and you have an orderly trend or you get more of a panic move where yields spike higher the way they have done the last several trading days and the quintessential reversals on a news headline or no news at all, the market sees a sharp intraday reversal and closes on its heels. like yesterday what they refer to a bullish outside day when looking at the bar chart. we see some elements of that

to really confirm the trend, it has to sustain below 3.50. it is where it was trading a few days ago once you move back through, you are back into the summertime trading range. i think anyone that got forced into positions or out of positions on the recent acceleration, certainly for anyone chased with shorts would be forced to cover and invigorate a bit morale i. ultimately the resistance now is at 3%. you know, that 3% area is a tough hurdle through the fourth quarter for the bond market. >> i want to talk about the broader market what is the technical indication about the broader market we broke through the june lows a couple days ago. now we are back above it what direction is the technical market heading >> the period between september and first two weeks of october

is generally negative for global risk, including the s&p 500. that takes us to october 11th before that turns the corner the trend clearly has been down into the period and accelerated. not helped by the development we have seen in the uk recently the markets are oversold that is important to note. as you retest the june low, the sentiment indicators and metrics looking at reports they are all at the extremes that are matched or exceed what we saw in june the conditions are ripe for a bullish reversal even if this is a continued bear market that stretches into 2023, which is not our house view at jpmorgan chase, but if it is, the conditions lead to a reflection or rebound in the market positions are forced to squeeze. our general thinking is major

support in the 3,500 handle. that relates to the s&p terminal fed pricing for the past year. we have a cross market model that looks at that if were you to stretch the s&p versus terminal rates at 4.5, that fits with the idea of support in the 3,500 let's call it a worst-case scenario and if the selling accelerates, we think 3,500 will hold the market will rebound and close above 3,900 and reverse in the fourth quarter in our view the big resistance is 4,150 to 4,200. if this is a bear market, you should see a bear market rebound taking you up 10% to 15%. >> something to watch. key tips jason hunter, i appreciate it. >> thank you. turning attention to the oil market oil prices are slipping after gaining more than $3 yesterday

the rebound off nine-month lows was sparked by the inventory and dive in the rally after the bank of england stepped in to staple 00 the pound losses are capped by signals opec plus may cut output at the meeting next week. let's talk about the energy markets with bart melek. >> good morning. >> give us a summary of the action and the oil market this morning. obvi obviously, the drawdown was a big boost. the dollar is rising again today. what direction do you see oil going in today >> i think today is probably going to be a rather beoring da. we have the bank of england with

liquidity which ignited risk appetite across all asset classes. we also had speculation that the russians are pushing as much as 1 million barrels for the opec plus producer ed in the report, eia came in with a significantly lower than expected inventory across the board about 8 million barrels less inventory in products and crude than expected. that served as a catalyst to move higher. today, much of that has been, you know, priced in. unless we get new information, you know, likely about opec, this could go, but i still think this was mostly a short covering rally yesterday and that's done

i suspect opec comes out with a cut of the meeting in vienna and we could move toward $90 that's where we see resistance at this point. i think as far as today is concerned, maybe steady as she goes not a lot of things unless something happens during the day. >> $90 not a big move from right now. i want to talk about what may not be priced in obviously china's recovery from covid lockdown is not happening as fast as people thought. from fedex to others, it has hit there. if and when china reopens, does that change the complepcomplexi the oil market >> i think it changes considerably earlier in the year, we were confident that china would dispense with the covid zero policy that hasn't happened we are seeing signs that this

may change as we go forward. china will reopen. it is likely, i think, opec will mitigate some or reduce production the risk remains the global macro side where we could be headed for quite a hard landing. that means the current estimates that agencies have of some 2 million barrels of oil demand next year might not materialize. if we go hard to the down side in aggregate demand, opec will be worried about surpluses and we have the disconnect still where the futures markets were more negative on prices than the current supply in demand would suggest. that is still to play out. much will depend how severe the

slow down is the fed is telling us they will be very aggressive we could see the bank of england to be very, very aggressive as well certainly that is what is priced in of course, the ecb and other central banks. china comes out and we could in the west be slowing severely and offsetting that. as important as china is, we are still the big consumers of oil >> you laid out the worst-case scenario bart melek, thank you. turning attention back to the developing story here in the u.s. hurricane ian slamming into the florida coastline. we have chris pollone in tampa with the latest. good morning, chris. >> reporter: frank, good morning. the tampa area dodged the worst of this. this storm is now ongoing. it is now a tropical storm it is dumping tons of rain in

the orlando area and out to the space coast. we are seeing many reports of flash flooding inundating homes and cars it will continue to be a problem throughout the day the stormed roared ashore south of where i am by a couple of hours. fort myers and naples inundating neighborhoods. authorities say they know they got hit hard they will go out today to try to assess the damage. so far, no reports of fatalities with the storm we will keep an eye on that. 2.5 million people are without power right now. there are crews in the state to restore power when they can. the governors of georgia and north carolina and south carolina declared a state of emergency as they see ian moving in the areas frank. >> chris pollone, thank you. as we head to break, the wait is over for aaron judge officially making history in toronto last night

tying the american league home run record in the seventh inning the vistrike to left field tying roger maris' record. judge's mom and maris' son in the stands to witness the homer. we're back right after this. >> and the 3-2 jolting to left field. it's number 61 he has been chasing history in a single season.

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the audi e-tron family. progress that moves you. welcome back to "worldwide exchange." here's what's on the agenda. weekly jobless claims and the third reading gdp out at 8:30 a.m. we get earnings from bed bath

and beyond and the speech from mary daly. and loretta mester sitting down with our "squawk box" this morning. you don't want to miss it. stocks and bonds suffering a rough september. leading some to question if investors is should rethink the portfolio strategy here is ken griffin from yesterday's delivering alpha >> the 60/40 portfolio looks better today than any point in recent time. >> why >> the 10-year bond at 4%. 10-year bond at 75 basis points or 1%, there is no upside to the bond in the moment of recession which is characterized with inflation. now 10-year at 4% in a down turn and inflation heads back to a one handle, the bonds are worth

more than today. that is a win in the portfolio that's in the green. when the equity portfolio is likely to be in the red. >> for more on that and the trading day ahead, let's bring in degas wright. cio and cnbc contributor good morning, degas. >> good morning, frank. >> you heard ken griffin say that in person what is your take as the traditional 60/40 portfolio. is that what you are advising clients to adopt >> yes for clients to say let's consider municipal bonds for instance, if you live in the state of georgia, you can buy a georgia state road and tollway authority bond that will mature next year at an interest rate of 2.75 now if yyou compare that to a

corporate taxable bond, that is the same as a 4% bond. georgia bonds on the municipal bonds are tax-free >> quickly, i want to get to the stock picks. do you have a target in mind for where you think the 10-year yield will end 2022 and where do you see the s&p moving >> absolutely. what shocked the market is the federal funds forecast and the end of this year, a 4% fed fund rate right now it is at 3%. also by 2023, the plot indicated a 4.6% fed fund rate that is a significant shock to the market and that's what we're seeing the market go down. that has changed our outlook for the next few months that we could hit 3,500 with the s&p

because of the shock to the market >> with that perspective in mind, let's go to the stock pick obviously a lot of volatility right now. >> you want to select stocks that do well in recession. those stocks are stocks that do well when you have the unemployment rate increasing and also we have consumer sentiment declining. those are going to be sectors such as health care and consumer staples. stock abbvie it does a really great job actually invests 13% of their revenues in research and development that really performs or starts to perform a strong pharmaceutical pipeline such as drugs like humera for arthritis

and skin disorders we really like abbvie. another company would be general mills. everyone is familiar with the cheerios >> absolutely, degas >> betty crocker >> we have to leave the conversation there we appreciate the time thank you for being on this morning. that does it for us on "worldwide exchange. futures off lows of the morning. dow looking like it opens 180 points lower "squawk box" takes it from here.

good morning stocks reversing course from yesterday's relief rally we were down six straight days relief rally gained some of it back down 200 on the dow. we will show you what is moving.

porsche making the public debut in germany and surging that's a nice one in what has been a slow year for ipos so far. and hurricane ian downgraded to a tropical storm. we will bring you the latest on storm. it is thursday, september 29th that means -- october is two days away? what happened to september "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm rebecca quick along with joe kernen andrew is on assig