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it is 5:00 a.m. at cnbc. here is the top "five@5. gearing up for the final day of the first quarter with one sector set to do something for the first time and bouncing back from the recent turmoil it is nothing to what investors are seeing overseas. breaking news. a grand jury indicting former president trump over hush money payments leading up to the 2016 election we are live in florida with the latest. and some companies are pivoting away from china, but elon musk is diving in. and the first investigation into the regional bank stock

pi p picks. it is friday, march 31st, 2023 you are watching "worldwide exchange" here on cnbc happy friday welcome to "worldwide exchange." i i'm frank holland. let's kick on the final day of trade of the quarter. a mixed picture and flat across the board. we saw movement in the nasdaq after a positive session for stocks yesterday with the dow and s&p on track for the best weekly gains since january a different story with the quarterly performance for the averages with the dow. the only index tracking for a loss with the rest as you see heading higher into the open for the quarter. the nasdaq out performing with a 14% gain a big rise with the tech focused index. unless something unexpected happens, it is the strongest

performance since the second quarter of 2020. the 10-year treasury is at 3.57 the 2-year treasury is above 4%. rising since yesterday 4.14%. energy and oil is above $70 a barrel brent crude is $74 a barrel. down .50%. brent crude is almost $79 this morning. natural gas with a bump up 1%. we are speaking of a data point which is front and center is february pce. the preferred read on inflation is out at 8:30 a.m economists hope to see a gain of 4.7% on the year that is the picture at home. let's see how things are going overseas with arabile gumede with the early trade in europe >> good morning, frank markets are in the green as well

this morning let's look at the quarterly basis and what it looks like investors are shying away from the banking sector we did see in the u.s., but out in europe, particularly at the halfway mark of march with a drift away from the financial equity and banking stocks and a drift to the tech counter. if one looks at those, you see positivity here it is perhaps an outlier when you look at the likes of unicredit. that bank in italy finding some positivity there on the general basis, it is rolls-royce manufacturer of weapons is enjoying themselves as wealth ll as the tech counte. the worst performers are the credit suisse stocks being a very important one for

credit suisse being bought out by ubs 70% fall on the quarter. very interesting with glenco not enjoying the kind of positivity you would see from china reopening. interesting to note they are down 17% on that front very mixed picture the banking counter is one to have run away from as investors drive to the tech counters in the quarter. frank. >> arabile, thank you for the look at the early trade. back to breaking news this morning. a grand jury in manhattan voting to indict donald trump this is the first time in u.s. history a sitting or former president will face criminal charges. arraignment is expected next week nbc's gary grunbach skrjoins us

>> reporter: frank, two weeks from the day that the grand jury started their work donald trump started the day doing what he did every day. deflected and denying and distracting on social media. in the past two hours, he posted on truth social saying where's hunter the reference to the president's son. that is just a distraction he posted several times in the past 12 hours. he says this is political persecution and election interference at the highest level in history the democrats have lied, cheated and stolen in their obsession to get trump. they have indicted an innocent person he is using phrases like soros backed prosecutor. he is trying to blame everyone and anyone for the crimes he

committed. >> gary, now getting the former president to new york is nothing short of logistical feat talk us through that process >> reporter: so he is here in mar-a-lago right now in palm beach. he has to take the motorcade ride with secret service he has been flying to a new york area airport arriving by motorcade or chopper and get to the streets of lower manhattan with secret service and nypd and the joint terrorism task force working to make sure the secret service gets to and from the arrangement. >> gary grumbach, thank you. we get to the latest investor survey. we are tapping into the investors and strategist and our cnbc contributors. this gauges outlook and strategies for the second quarter and beyond

that includes the s&p and where it is heading next with 68% saying the index has more room to fall. 16% say a rally is taking shape. let's bring in gina sanchez. always great to see you. >> thank you >> we just had the results of the survey 68% of the people believe the s&p was going to fall. it has had a fairly strong run this year. up more than 5%. what's your take >> it is surprising the rally that took shape after svb fallout. one thing we're looking at is the divergence with the equity market and high yield market which is related you have the equity rally at the same time you have high yelled performing negative for the month. if you look at downgrade versus upgrade using moody's, we have a

2-to-1 rate. i would say that the high yield market is probably, you know, calling for further equity weakness >> gina, we had a report from nbc news, donald trump is expected to be indicted. how do you see this impacting the economy? we have seen diff buy ipartisane debt ceiling issue >> we have seen that as a fixture since 2016 and before that really since, you know, since 2016 it doesn't do a lot for business confidence because it just creates the kind of unsrcertain that makes it hard to plan for business i think while congress doesn't call and ask me what they should

do the more there is tension within congress, the harder it is for businesses to plan if we get to def default. that would be -- that would be a catalyst for negative outcomes all over the market. >> gina, you are looking at the yield curve as possible recession ratindicator. if we see a clear downturn, will that signal a complete end to the hiking cycle >> you know, it was a little surprising that the fed continued with their last hike i think that the market right now -- inflation is pushed by a shortage of workers. that is the last piece of

inflation that continues to go up i think there is tightening within the banking sector to make up for tightening that the fed could do i think right now we are sitting like a frog in boiling water as the water is heating up. i think we will get to a boil. >> gina sanchez, thank you very much for being here. >> thank you coming up on ""worldwide exchange," mr. musk heads to fine china and the high-level meeting he hopes to land. and borrowing the alibaba pla playbook businesses spinning off in its own company. and we are only in the early inning for the latest issues

with the fed stay with us "worldwide exchange" returns after this makeeven smarter. we call this enterprise intelligence. (woman 1) i just switched to verizon business unlimited. it's just right for my little business. unlimited premium data. unlimited hotspot data. (woman 2) you know it's from the most reliable 5g network in america? (vo) when it comes to your business, not all bars are created equal. so switch to verizon business unlimited today.

welcome back to "worldwide exchange." a look at the top corporate stories right now with bertha

coombs >> happy friday, frank musk is looking to visit china and meeting with the premier no details on the focus of the potential meeting, but china is tesla's second largest market after the u.s. and shanghai planned is the ev maker's large effort production hub. massachusetts regulators is looking at insider stock sales at first republic bank in the weeks leading up to the turmoil. his office has spoubpoenaed fir republic for matters on insider trading. we will hear more when he joins "squawk box" at 7:00 a.m. netflix is restructuring the film group to make fewer movies each other and centralized decision making.

the streaming giant will combine units with small and mid sized pictures and changes results in layoffs and departure of two of the most experienced executives. frank, they make 50 movies a year i had no idea they made that many >> an lot of movies on netflix. i'm a fan of standup specials on there. >> it is good. >> bertha coombs, see you later on we have to share our tips for netflix. turning attention to a.i elon musk and steve wozniak along with others say the powerful a.i. systems should be created once the issues and

dangers are resolved joining me now is cyrus mewawalla. >> thank you, frank. >> cyrus, we will get to the ethical questions about a.i. in a moment first, i want to focus on the investor interest in this. we're seeing growing demand for a.i. what does this mean for the companies that provide software and chips and cloud structure. is this a rising tide for all boats or is there a clear winner or loser >> we had hype on the metaverse in the past. 12 months ago, everybody said the metaverse is the next big thing and facebook changed its name now 12 months later, it has not happened we could overhype a.i. if you ask me, i'm head of

intelligence at global data. it is the number one thing facing business leaders today. i would expect some of the best business leaders to invest heavily in a.i. or at least looking right now and getting a.i. strategy up on what they should be doing. i think the big a.i. leaders and big tech and other private leaders like open a.i. and enterprise software system could get an upgrade. >> we are seeing strong performers from the enterprise software names speaking of investment, from the first quarter survey we asked if they made an invest. in -- investment in a.i. carbon monoxides -- investment in a.i. companies in the last year do you expect a near-term push for companies trying to invest in a.i. to create capabilities

or offer and say they are working on the capabilities? >> if i was one of the ones that said no, i would crrethink my strategy we passed a milestone, if you like, in the development of a.i. where it is likely to take off in terms of how i view it, there are three levels of a.i. weak a.i. or artificial narrow intelligence that focuses on chess or recognizes faces or write a poem that is what chatgpt does. the next is strong a.i. or general intelligence that doesn't exist today that is where a machine possesses human level intelligence the third level is the dangerous one. artificial super intelligence. where the machine surpasses the brightest mind that is why musk and others

wrote the open a.i. letter without regulation, we could be in a dangerous place. >> you hit on the topic we started off. 1,000 tech leaders and other names saying that a.i. presents profound risks against society and humanity how real are the risks is it a risk in the near term or long term? >> i think there is -- the c cynics would say this is a ploy by those behind in a.i microsoft and google were forced to speed up the release of their a.i. models as a result of what open a.i. did which was spurred by microsoft's investment in a.i. you argue the cynical commercial reason for asking for a slowdown the risks are quite genuine. if we are moving toward this level two stage of a.i. and last

week, on the 23rd of issued a p chatgpt has signs and we are on the cusp of entering that phase. the two dangers are without regulation, there is national security implications and military is using the technology and autonomous drones or soldiers could turn on their generals annin and the ethics risk in the war on a.i they have microsoft ethics teams as meta. >> it will a story to watch. cyrus, thank you >> thank you ahead on "worldwide exchange," this morning's big

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time for the big money movers three stock stories of the morning.

nikola the company planning a $100 million stock sale backed about an unnamed investor committed to buying unsold stock. the founder was convicted of fraud last october and produced 133 trucks in the first quarter. shares down almost 6%. virgin orbit stopping operations for the foreseeable future shares are down 50% this morning. according to audio from the all-hands meeting obtained by cnbc ceo dan hart says the company will layoff all 100 employees. the it is set to open with a market cap below 50% and jd.com issin spinning offthe unit and the deal is worth $1 million each shares are higher in the asian

trade. still ahead on "worldwide exchange," my next guest says there are opportunities in the space for investors who have been missing out if you haven't already, follow our podcast check us out on apple or other podcast apps "worldwide exchange" will be back stay with us so you won't miss an opportunity

it's 5:30 a.m. in the new york city area 5:30 p.m. in singapore we are just getting started on "worldwide exchange. investors gearing up to close

the first quarter. tech stocks regaining the shine with the tech sector looking to move forward. and financial stocks are looking at a quarter they would likely like to forget. and a breaking story indictment of former president trump. eamon javers is standing by with the latest and what's next in the key moment in american history. it is friday, march 31st you are watching "worldwide exchange" here on cnbc good morning welcome back to "worldwide exchange." happy friday as well let's check on u.s. stock futures. we have seen the dow jones industrial average rise in last few minutes. it would open up 50 points higher flat across the board. this following the positive

session on thursday. a different story to close out the first quarter. the dow is the only index looking at a loss for the period s&p up 5.5%. nasdaq with the 14% gain and strongest three-month performance since the fourth quarter of 2020. we dive into tech in a moment. a check on the bond market bond yields with the benchmark 10-year treasury at 3.55 we are seeing the 2-year treasury, yield rise above 4%. we continue to watch the spread with the 2/10 year let's check oil. wti above $70 a barrel now $74.50 up this morning. brent crude at $79 a barrel. one key point is february pce. the preferred read on inflation

which is out at 8:30 a.m economists expect the number to hold steady with the gain of 4.7% year over year. turning attention to the big story today. a grand jury in manhattan voting to indict donald trump the first time a sitting or former u.s. president will face criminal charges eamon javers is in washington with the very latest on this breaking news story. good morning, eamon. >> reporter: good morning, frank. it is historic first the former president of the united states under indictment at a time when he is campaigning to take power into 2024. the former president issued a blistering statement last night saying this is political persecution and election interference at the highest level in history the democrats have lied and cheated in the obsession to get trump. now they have indicted a completely innocent person trump put out a social media post calling the prosecutors

here thugs and radical left monsters the former campaign team sent an email to supporters last night asking for money donation ranges from $24 to $250 we don't have the specific charges in the indictment, frank. we are waiting for those we have word from the trump attorney confirming he has been indicted we do know the manhattan district attorney alvin bragg has been reviewing the circumstances around the $130,000 hush money payment to former porn star stormy daniels during the 2016 campaign there could be charges of falsification of business records and campaign violations. we will find out when the indictment is unsealed all of that raises the spector of the former president of the united states being arraigned in the new york city courthouse and fingerprinted and photographed for a mug shot as he continues to receive protection by secret

service officers manhattan district attorney alvin bragg said we contacted from trump's attorney tosurrend. the question no one can answer at this hour is how the indictment will impact the base of political support will his base rally around him in the time of legal peril or will trump supporters look for another alternative? no statements from any of the trump gop rivals for the nomination governor desantis expressed support for the former president of the united states he said he would not extradite him from the state of florida even if requested by new york authoritie authorities. that is not likely to happen, frank. the clear statement from mr. desantis of support for mr. trump, mr. trump on the campaign trail has been denouncing mr.

desantis that is the strange moment we're in politically frank, back to you. >> eamon, thank you. we will be watching your reports all day long eamon javers live in d.c thank you. turning attention back to the markets as we close out the first quarter of the year and a wild start to the year last year's worst performing sectors in the s&p is chalking up big gains at the top of the industry tech solidly in the red after the rate hikes since november with one more likely on the way a very different story for financials down 7% with recent bank failures and contagion is a key concern. we have coverage with nancy tengler as well as stephen scouten from piper sandler nancy, wall street is trading in

names for growth all up double digits for the quarter. i want to talk to you about the possible recession, nancy. are you rotating into tech or fading tech right now? >> frank, thank you for having me we were adding to technology throughout the fourth quarter. we actually have been trimming back as of the morning of the fed pressor. you can still make money in tech for sure these companies turned in really solid earnings growth last year. still were sold off. i think service now that turned in almost 30% earningsi growth last year. so, you have to pick your spots.

our investing theme has been companies that embrace technology and embracing the digital revolution and providers of the digital tools to make companies more productive. i think we're in early innings you wait for volatility to add to the names >> you are looking for opportunities in tech. what are the companies you are eyeing and what quality are you looking for in an uncertain environment? >> is that not the truth the single most complex investing environment in my career we are looking for a couple of things we want reliable growth. we want companies to grow business in all economic situations you know, obviously, if you are in recession, they will grow less quickly than economic expansion. we want the essential technology companies. we also are looking closely at

management that's a qualitative factor and hard to assess we want strong management teams. bill mcdermott at service now. he is a great manager. we are looking for companies that are in the sweet spot of cloud growth or chip makers like qualcomm to enterprise cloud and a.i. then networks with cybersecurity companies which cios declared that is last place they will cut in the budget. if you look at the numbers, microsoft and you look at the most cios spend and from the surveys that software services growth is expected to grow 15% next year. those are the names we want to look at and add to our portfolio. >> you are adding on weakness.

you are trimming positions on the big winners for the year salesforce up 48% this year. why did you decide to trim now avoid a proxy fight. marc benioff has calmed down dissd diss dissension >> we will see they had significant turnover in management that is a red flag for us. if you look at the business, that is why we hold it it is a large holding in the portfolio. we don't want the market to make ourdecisions for us. we appreciated 40% and we trimmed it back to the target. that was about 3.5% of the portfolio. same with microsoft. we took some off the table we still love the company. this is the time you have to be disciplined in stocks. this is what we did with apple we still own, but actively selling in 2021. then in the fourth quarter, we added back to the names.

we don't turnover portfolios a lot. these are changes. it is important, i think, to declare victory when you can and step back into high quality companies in duress. >> take a win when you can take a win. nancy, thank you very much >> thanks, frank turning to financials and the worst sector so far this year first republic all driving the sector lower as the run on regional banks rolls on. not every stock in the sector is lower. smei is up for the year. joining me to discuss is stephen scouten from piper sandler. >> good morning, frank thanks for having me >> looking at the banks, we had a guest on earlier who said banks are trading seven times forward earnings the s&p is trading 17 times forward earnings are the banks set to discount so you jump in with both feet or

stock pickers market >> it is a stock pickers market. there are more flows into the index at the front stage of that there is money to be made there if you know which stocks you want to target the names we feel strongly about are the flight to safety names the super regionals or the four largest banks where we see deposit flows and stability. that is where you see investor interest we are still watching deposit flows closely. trying to figure outs what these banks can earn moving forward. like you said, they are trading seven times today. for a group that trades at 10 to 12 times at the larger end of the spectrum, thatdiscount to the degree we can remove failure, i think we will have a nice run in the group and make up that gap that you showed from

the under performance in the first quarter sdp >> something to watch. you say you are looking for stability. how important is the pce report for the stability if we see inflation showing a clear downtrend? does that add to the stability or give you an answerof what the fed will do next >> i don't know if it will give us an answer, per se i agree with you, we expect another 25 basis point hike. to the degree we get stability around inflation and additional rate hikes off the table, that would help the group from a credit contagion perspective we have seen no sign of credit fallout as of yet. obviously, with what we have even in the past few weeks, it is a harder landing which increased significantly. we start to get the stability back here in the weeks and months ahead, we could come into another headwind of credit

fallout late neither year. -- fallout later in the year if we get the to rate hikes, that would take another headwind off the table. >> you say investors are looking for safety and quality right now. you are identifying a couple of banks you think are relatively safe one is a regional bank truist financial give us a sense of the names you believe in the regional bank space that are safe. >> that word safety is not as comfortable as some thought a few weeks ago. a bank like truist with over 2 million account holders throughout strong markets in the southeast is one north of 6% dividend today we feel good about over the long term same for regions granular deposit base. even first citizens that we saw in the news the last few days. we look at the granular deposit

base and more customer stability and strong capital they have been around for the long run they are not niche businesses or idiosyncratic. they are core regional banks which have grown over time there are fears community banks are debt there will be dynamics -- banks are dead. there will be dynamics here. >> it is something we are following here on "worldwide exchange." stephen, thank you very much. coming up on "worldwide exchange," more on the investor rv ahat the strategists say over putting their money to work in the second quarter "worldwide exchange" is back in a moment

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welcome back to "worldwide exchange." february personal income and spending is out at 7:30 a.m. eastern. following that number, a trio of fed officials are speaking today. john williams, fed governor lisa cook and fed governor christopher waller lizzie evans talks about the second quarter and health care

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welcome back time for the "wex wrap-up. six business dopplestories fo 6:00 hour. insider stock sales being investigated by executives at first republic bank. increased production rates of the 737 max soon. the company adds it is in the final stage of faa approval for the 737 max model. netflix is restructuring for the year the changes will result in a handful of layoffs and departure of two executives. virgin orbit is stopping

operations after failing to secure a funding lifeline. according to audio, the ceo says the company will layoff all but 100 employees. virgin orbit is set to open with a market cap below $70 million. jd.com planning to spin off the property and industrial unit and list on the hong kong stock exchange the deals could be worth more than $1 million each shares are higher in the asian overnight trade. and nikola falling ahead of the company after the stock sale from the unnamed investor. the company's founder was convicted of fraud last october. it is the last day of the quarter. a positive day with stocks as the fed continues to raise rates and the turmoil in the banking sector the dow is on pace for the

fourth negative quarter in the last five. s&p and nasdaq are set for the best quarter since the end of 2020 let's bring in lizzie evans. managing partner at evans wealth >> good morning, frank. >> we have talked about the volatility in the first quarter. rate hikes and turmoil your clients are high net worth individuals and families how are you balancing the portfolios are you focused on equities or bonds? >> great question. what a first quarter it has been all leading up to march 8th, the market trading on interest rate outlooks and speculation as to when the fed would stop hiking rates and the terminal rate would be yet, we were continually debating will the market reach october lows we have not seen the volatility which is typical of the market bottom

usually at the bottom, something breaks farther fast forward to today. silicon valley bank and signature bank and credit suisse and the like something broke. policymakers had to step in. i'm optimistic i think the market -- i think volatility is here to stay i think the market could very well move lower before it moves higher i think a year from now, we are positive in equity and bonds >> i think since silicon valley bank, a lot of people are asking about the portfolios and where the money is being held. you are looking at a recent bank of america sentiment survey. sentiment is low right now what does that tell you about the environment and the next three quarters of the year >> frank, investor sentiment is terrible you know, all day long, i'm talking to clients where we are

15 months into the bad market. clients are ready to throw in the towel. that is a good time to be in the market bank of america released the global fund manager survey last week interestingly, pessimism today is as much as we have seen at market lows over the last 20 years. also, retail investor with aaii. american association of individual investors that look at retail investor sentiment it is as bad as the great financial crisis it pays to be a contrarian historically, when we had this amount of pessimism, the markets, s&p 500 is positive to the tune of plus are 15% of the next 12 months >> our latest survey is out today. among the questions we asked is which areas of the market they will concentrate on in the second quarter

look at the results. third said high dividend stocks, healthcare, financials and mega cap and energy what do you think about this area of concentration results for our survey with more than 1/3 focused on high dividend stocks? >> i think for our clients and as an investment management style, we are less focused on style and growth i think high dividend stocks have very much been in favor with a lot of the macroeconomics uncertainty. for us, we are looking for companies that have earnings and are projected to have earnings growth and healthy free cash flow i think there are opportunities in growth and value. >> let's get to your stock pick with the stocks that you think is a strong performer for the rest of the year

unh in the healthcare space. this has been the biggest drag on the dow this year do you see a major turn around what makes this your pick today? >> yes, i think unh is down 11.3% year to date 9.4% of the dow jones industrial average. as you mentioned, it has been a pull you look at the stock closed yesterday at $470 a share. the median price target is $599. that implies 27.5% upside from here it is twice as profitable as the peers. it has a cash flow of 5.5% it has been really beaten up given the volatility in the market, you are buying at a great price. that will be one of the best companies in that healthcare space long term. >> lizzie, great to see you.

lizzie evans from evans may wealth management. thank you for being here. one more thing before we toss to "squawk box. three and a half hours before opening bell we see mixed action. nasdaq in the red. dow jones industrial average is opening up 50 points higher at this moment. remember, pce coming out at 308: a.m. eastern that will do it for us on "worldwide exchange. "squawk box" is coming up next

good morning stocks pointing to slight gains to close out the first quarter today, we have a key read on inflation later this morning one key read that the fed likes to watch new york grand jury

indicting former president trump in connection with hush money payments to a porn star and the lead up to the 2016 presidential election we go live to washington, d.c. for the latest. and massachusetts inve investigators opening up an investigation into the stock sale of first republic bank. it is friday, march 31st, 2023 "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 becky quick along with joe kernen andrew is off today. joe's here >> i