cowards. and sources tell cnbc ufc parent endeavor is in a deal to buy wwe entertainment. details straight ahead it is monday, april 3rd, 2023. did anything happen on april 1st? did you get fooled i'm glad it was a weekend. "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 and andrew ross sorkin, who is back. welcome back. >> thank you anything happen last week? >> a few things. >> a couple? >> not like what might happen

this week. we'll see. >> let's look at the u.s. equities it is monday we're back and ready to go you see the dow futures are indicated up triple digits 114 points right now s&p is down 4.5. the nasdaq is off 78. it is the first trading day of the second quarter here is where stocks stand for the year you see the dow is up, but by .40%. the s&p is up 7% then you have the nasdaq huge winner up 16.8% for the quarter. treasury yields this morning 10-year treasury is 3.520. 2-year treasury up to 4.1906 the story is crude oil prices after opec plus announced it would slash output. saudi arabia called this move a prec prec precautionary measure.

this came as a surprise to everybody. cuts will start in may they will last until the end of the year oil prices tumbled last month and through the quarter as traders feared the banking rout could dig into economic growth you have to think that is what the saudis were thinking, too. if you look at the energy companies, chevron is up 6%. conoco up 3.5% bp is up 4%. we will talk to goldman sachs' jeff currie coming up at 7:00 a.m. this is inflationary it could mean the tfed has to stay higher for longer this is a ripple effect. >> they are not our friends. we knew it was coming. we asked them to not do the last cut and they did >> it was a huge decline and

expectations of potential for recession. also probably had the concern of it going lower. >> we have 4 barrels left in the spr. -- >> on friday, they were thinking about buying back on friday. >> why >> we didn't do it >> was there something pre precluding us? it was below $70 >> the administration said they would refill below 70. >> gas is $3 if you pay cash. i can't pay cash i do it on purpose you have to get change 10 cents a gallon. >> they are -- >> why throw money away? >> why give us something for cheaper? we expect you to take a cut. we are your friend we expect you to supply cheap. >> it is odd we thought russian moves would make oil tight for a while

they are doing this in response. it is an oversupply. you see japan paying above the cap price for a lot of oil buying russian oil and we are letting it go. countries do what they have to do. >> everybody is out for themselves >> exactly meantime, the company that is trying to not use oil tesla releasing first quarter production in delivery numbers yesterday. total delivery at 423,000 vehicles up 36% year over year and up 4% from the prior quarter to shares dipped just slightly. 1.5% we dig into the numbers with phil lebeau. we will do that at the bottom of the hour mcdonald's is temporarily closing its u.s. offices corporate offices this week as it prepares to inform corporate employees about layoffs.

citing an internal email that told staff to work from home monday through wednesday this week so it can deliver staffing decisions virtually. mcdonald's has not disclosed the number of employees it will layoff when i first saw it, my son messaged me, because we go occas occasionally we can't go today. it is closed it is not the mcdonald's it is corporate. the drive-thrus are in tact and remain open. >> i like what you said at the top. cowards. >> yeah. stay home. we have -- >> we don't want to see you in person. >> someone broke up with a long-time girlfriend >> it was charlize theron who gover

ghosted sean penn. >> stay home because i don't want to tell you in amerperson >> the world has moved where half people are home and half are at the office. i talked to hr people where we had this conversation. people firing people and how do you do it and how do you do it in a world where not everybody is in the office all the time? >> stay home because we want to text you >> you used to leave the office and you would get an email on saturday or sunday hey, i'm not in the office i thought about that over the weekend. we should have manchin on. where are these people i'm texting about manchin. they have to answer. i was thinking, wow. can you do that on a weekend can you expect people -- >> yes, you can. that's what happened to the world. >> because of remote >> 24/7. >> i guess it is that's what i thought. wait a minute.

they do everything from home anyway they can do this from home live by the sword, die by the sword. starbucks has fired rizzo, the employee who tried to unionize the company r rizzo was a shift supervisor and worked at the genesee street store in buffalo one of two stores to win unionization she said the store managers fired her after her shift on friday they told her because she had been late on four occasions. she said in to cwo cases, she w late one minute. rizzo missed four hours of work over those instances rizzo will fight for her job and wants to be reinstated

drama over starbucks and union continues. >> do you punch in >> a minute? how do you miss four hours >> do you nknow how they work gps. i don't know about starbucks this is in restaurants and factories. people don't have to punch in. >> what if you don't have your phone? can you show up? >> i suspect there is another way -- >> i occasionally forget my phone. >> i suspect there is another way when your battery doesn't work same at the airport and your phone with the boarding pass i'm sure they have options. cnbc confirmed the reports of the lawsuit over sex trafficking to jeffrey epstein and jpmorgan chase

go google founder and disney executive and hyatt hotels president and real estate investor all involved in that suit. and donald trump will stay at trump tower before surr surrendering to the manhattan d.a. the indictment will remain sealed before the court appearance at 2:15 tomorrow. we leave at 9:00 when we come back, ufc parent company endeavor group is in talks to buy wwe. alex sherman broke that story and he will join us next. and joe manchin will join us about the debt ceiling and the

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early as today joining us is alex sherman, reporter for cnbc.com, who broke the story. alex >> a bit of a surprise i wasn't expecting to obbe on tv this week. i'm on vacation. the wwe has been for sale for several months originally, it had expected to take a bunch of bids this weekend with wrestlemania. endeavor jumped to the start of the line that combination of ufc and wwe will make a new merged company, i'm told, with endeavor owning 51%. wwe owning 49% vince mcmahon, who stepped away from wwe, will stay with the company. that was the big selling point to him doing this deal he will be executive chairman of the combined company ari emanuel will stick around

and lead the company mark shapiro will play a significant role in the new combined company which values wwe at $9.3 billion. enterprise value. >> alex, that is a key point you brought up on friday, i was hearing they would take bids on this and that mcmahon realized he had to staep step away. maybe there are not enough bids? >> wwe put out a statement saying vince mcmahon was open to stepping away and selling it if it was the best deal for shareholders this is my own reporting and logic indicates sticking around with the company was the preferred option for mcmahon wwe is his baby. he has been in the business for decades. the idea he would simply walk

away seemed odd. this idea is rolling over into the new company and allows him to keep going with the company it also gives option value to his kids a bit of succession element going on here where stephanie mcmahon jumped in to be ceo and recently stepped back. what happens to her and her role with the company remains an open question moving forward as well. >> alex, what happens to dana white? he was somebody people thought t if there was a combination, he would get the top job. this sounds like it will never happen >> he keeps running ufc. what does happen is there is a lot of really big personalities now involved in the company. dana white is a big personality. vince mcmahon is a big personality. ari emanuel is a big

personality.boardroom of the co company is worth televising. that may have been appeal for vince mcmahon who had to step down six months ago amid the sexual misconduct allegations. then he came back to the company to sell the company. that was the reason he gave. look, how can i share the company if i'm not involved or on the board he came back and joined the board and did this deal and now will stick around in a leadership role. >> that may be good news for mcmahon and what he wants to do. is this the rest of the deal for the shareholders >> i feel this is the best news on the table for the

shareholders i heard the other buyers here, large media companies, say they were not interested. it includes our parent comcast and fox was not interested and disney was not interested. you have to see what is out there. wwe did that i don't know the extent of the saudi arabia sovereign wealth money which had been rumored to be interested. there is a lot of political risk if you sell to the saudis. endeavor may have been the smartest move if you were going to go forward with the deal. $9.3 billion enterprise deal on wwe is a significant premium before all of the sale options >> what does this mean for endeavor ari is the ceo of both companies. how does that change in a good way or otherwise >> well, the structure of the deal allows that debt profile to

ufc to not be a big deal this is all equity rollover. from that standpoint, it is less of an issue over what people thought would be a major hurdle to combine the two companies you cannot lever up. that is not an issue moving forward. there is a major tv rights deal coming for wwe it is probably going to be resolved in the next few months here that will be a real shot in the arm cash standpoint for the new combined company our parent company, peacock owns streaming rights fox owns broadcast and it also owns other broadcast rights we will see if the deals are renewed. if they are, i expect they willm ufc keeps rolling along. $1.3 billion last year

that is more money than it was making five years ago. endeavor will try to run the same playbook with ufc with wwe. the linking of we know live events we are a talent agency we know how to make stars. obviously, vince mcmahon knows how to make stars. you can see the logic. >> isn't wrestlemania coming up? is that where you are? did you go to l.a. for wrestlemania >> no, i'm in florida. wrestlemania just happened >> it is already over? >> this past weekend i didn't get to see wrestlemania we broke that story mid wrestlemania i hoped we would be brought in where they turned on cnbc for ruining the surprise >> it was wrestlemania week on "wheel of fortune.

it comes on after "jeopardy!." each contestant had a wrestling partner to help with the hangman. >> that is an interesting list of synergy we know how to make stars and do live events. >> the last time we talked about it, it was bet withing on -- betting on wrestlemania. it was scripted. only a few people knew. >> we broke that a couple of weeks ago. wwe is looking at gambling on scripted matches that is a way away >> ufc is a long way from scripted >> one last piece. has the endeavor side of the business, mean the hollywood side, impacted at all? client wise or hollywood stars or studios saying we don't like the ufc thing.

we may like less the wwe thing probably because of mcmahon and some of the issues you have seen ari come out publicly on big social issues around saudi arabia and you talked about the saudi arabia money and other things you have the allegations here against the guy who is now his peer >> how important are the basket of deplorables to ari? ari and the deplorables are not a match made in heaven it is a business. >> i think andrew's question is a real one assuming the deal is announced which we think will happen pre-market today and i think ari emanuel will make some statement or comment or have an interview. that is a decent question for him at the time. look, do you expect any pushback coming from acquiring wwe?

i would imagine there is a benefit to doing it. i say at least it is a feasible question that there may be a little bit of an issue bringing in a company run by vince mcmahon given everything everybody knows. they run ufc they are rolling along there are companies with dana white and that company >> there are people that are upset about dana white and we were talking in commercial break about the slap literally beat you it is as terrible you can get. >> slap challenge they used to do on tiktok >> harder. >> it is so intense and so upsetting to anybody for me, at least >> alex, thank you for working on your vacation >> it is 24/7 now. i'm here for you

>> we appreciate it. coming up on the other side, new numbers out showing signs of the turn around in the housing market diana olick will join us with that as we head to break, look at the pre-market winners and losers in the s&p 500. oil companies leading the way after that surprise production cut weea hrd from opec over the weekend. that is moving markets this morning. we are coming right back to talk about it >> announcer: this cnbc program is sponsored by truist wealth. where meaningful relationships matter most.

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welcome back to "squawk box.

a turn around in the housing market let's get to diana olick who has the numbers. good morning >> reporter: good morning, andrew we were talking about the possibility after we saw the strong january and february sales numbers. now here it is after seven months of declines, home prices nationally rose 0.6% in february. that is according to the report from black knight. it may not sound like a lot, but the strongest gain since last may. prices are down now 2.6% since last june. they had been down 2.7% in january. why are prices on the upswing? mortgage rates the average on the 30-year fixed took off last summer which put the brakes on sales. prices began coming down rates dropped in december and january and sales surged and prices turned higher rates did come back up again to the end of february. sales have held, not as strong

as january one thing which hasn't changed is tight supply. new listings were down 27% from pre-pandemic levels. it is amazing how quickly this market is turning on rates 39 of the 50 markets in the u.s. saw home prices rise in february three months before, prices were falling in 48 of 50 markets. it shows how price sensitive people are because the market is still quite pricey, andrew >> that is what i was going to ask. you get the sense of prices falling. they are not in certain places at this point when you talk to folks in the residential real estate universe, the expectation looks like what for the end of the year >> reporter: it depends be -- it depends where you are. we see the big pandemic surge markets like seattle and pe

phoenix. we see prices in the midwest come back strongly the sunbelt and miami, people keep moving there. it is a tale of different stories across the nation. if mortgage rates stay within the range they are in and people are getting more used to and agents are telling me that and we are seeing more bidding wars and we will see strong demand. >> diana olick, thank you. fascinating. coming up, futures right now are mixed. dow up with chevron and exxon and that index up. nasdaq is down the nasdaq is up 16%, but it is a beta thing it comes back 16 the same type of movement. it is up. >> mike santoli and others saying it is up 20% from the lows it hit and it is considered

a bull market. we are not near the highs. >> we'll talk strategy next as we kickoff trading in the second quarter. later, senator joe manchin will talk about the op-ed and talking about the biden administration pursuing an ideological agenda it plays into speaker mccarthy's heard about negotiating the debt ceiling. that is coming up at 8:00 a.m. eastern. we'll be right back. >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure to helep every connected from wherever we go. well at at&t we'll help you find the right wireless plan for you. so, you can stay connected to all your drivers and stores on america's most reliable 5g network. that sounds just paw-fect. terrier-iffic i labra-dore you round of a-paws

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good morning welcome back to "squawk box. we are live at the nasdaq market site in times square we have the news about the energy complex that would impact the dow. it is not. the s&p 500 is off 2.5 nasdaq off 72. the dow is looking like it would open 128 points higher

>> joining to us talk about the trading day of the quarter is stephanie link h hightower strategist and cnbc contributor. steph, good morning. what do you make of the opec news and what it is doing to wti and oil and energy stocks this morning? >> yeah, it was a big surprise over the weekend i would say that it is obviously a positive for the energy sector the complex itself especially for free cash flow. the companies before the news today is still generating a ton of free cash flow. to the extent the price is higher, it is better for them and shareholder returns. we know what they are doing with the cash flow. they are not doing it in production, but share buybacks and dividends. on the other hand, it is negative for the consumer if oil prices go higher the fed probably is going to continue to go anyway. i looked at the core pce numbers

last week and last month it is running 4.6% no matter what oil does, they are looking at other inflation and it stays sticky. this news is not great in they will continue to be hawkish. the big question is the spr. it is at record lows what do they do? they have to do something. that is also going to put a floor on energy prices >> so do you buy -- first of all, do you own oil stocks already or would you buy some based on this news >> yes i'm overweight the benchmark in the s&p is 5% i'm 8% overweight in the portfolio. i own chevron and barbell. i own a wonderful technology company hidden inside the firm i own diamondback energy they are all down from 9% to 12% year to date

they trade at 9 or 10 times earnings they are attractive. this news today is very much of a positive for them. >> okay. let's talk about the other big thing in the quarter technology is doing well relative to the financials is that a trend you expect to continue in the second quarter >> um, well, i think there is a place for the portfolio for more of a balanced approach this year technology, i get it it was more of a macro call, i think, why they have outperformed rates have come down in the first quarter and inflation has started to come down you have a flight to safe with the bank scare and meme reversion. if you think about it, growth and year to date out performed value. there was some reversion in the first quarter. that all being said, becky,

there are great stories and adjustable markets in tec technology they have great free cash flow as they cut costs. i get why the stocks have rallied. i think they moved really far really fast. i'm inclined to take profits in meta up 70%. i think in my portfolio, there is a place for balance you want to own other things like industrials i like the onshoring theme i like aerospace i like agriculture i like the china reopening names within industrials on the consumer side, i think the consumer data we got of savings up 4.6%. up from 2.7% from the june lows. we have spending from the consumer at 4% i think the consumer continues to spend it is just on services we noted that. i also like the china services theme for the consumer you saw the macao numbers over the weekend. we got the pmi services number

last week. there are places to diversify within the portfolio >> are you overweight oil with your portfolio we will see lee cooperman on later this morning he is 20% oil. >> that is big i was 10% last year. i just took some off because they had such a nice run that being said, as i mentioned, these stocks are down double digits halliburton is down 20% year to date it trades 11 times forward estimate i don't own halliburton, but i'm interested you can pick some up here and i don't know if i would be 20% that's a big concentrate i understand the logic because the valuations are compelling and free cash flow is stroke -- strong. >> he was 20% before the output

today. stephanie, thank you we will check in soon. >> thank you all right. coming up, disney is holding its first annual shareholder meeting since bob iger returned in november we will tell you what to expect next. later, don't miss our interview with billionaire investor lee cooperman. we remind you. follow us on your favorite podcast app. we'll be right back. cool, right? anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. hot dogs! fresh, warm hot dogs! before investing carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com

disney shareholders convening for the annual meeting today amid major changes at the company. including 7,000 layoffs and internal structuring announced for a look at what is ahead for disney and bob iger, let's bring in claire atkinson good do see you, claire. another week and another controversy about disney disney cannot stay out of the news it is not always for great stuff, is it you think iger has things back on track a lot of things he needs to deal with >> absolutely. he is really undertaking a gut renovation of the mouse house. as you mentioned, 7,000 people on the block

the company last week fired the chairman of marvel it let go of daniels, the number two under bob chapek the marvel president was let go last week. there's a lot happening. as you mentioned, the biggest situation that disney faces at the moment is down in florida where ron desantis has essentially dissolved the tax authority. he has suggested that he wants his own people in there. disney managed to ma move to get that back to disney. that something they can retain for a long time. ron desantis said he will look into it. i think it is full of holes. we will see where it takes us. the shareholder meeting is coming up this afternoon as you mentioned. two years ago today, bob iger

was discussing his departure from the company $195 stock today and now around $100 shareholders are expected to ask about succession and ask questions about the don't say gay situation at the culture wars and ask babout china shareholders in the past asked about china. executives are due to meet house congressional members this week and talk about what is the future between china and big american companies and how can america compete when it comes to a.i. and be competitive with china when it comes to tech and media products there's a lot on the agenda today. i'm interested to hear what gets talked about >> the list of things you went through in terms of it

hulu and espn would be -- you could have one ceo trying to figure that out. china, you could have a ceo trying to figure out a strategy there. then you throw culture issues and political issues does the governor like us? it is a mess in that regard. i don't know if -- do you think iger is going to honor the most recent deadline for when he leaves there is nobody on the horizon >> there's 18 months left. he is committed to finding that successor. you know, there is speculation it could come internally whether it is dana walden. they have co-chiefs of the

entertainment division with entertainment and sports and parks. could kevin mayer, once a candidate for ceo, was the ceo of tiktok for a time and now running his own production entity could he be in the fray? that is the question some people are asking as you mentioned hulu and espn these are topics the company will decide if it sheds hulu and puts the proceeds as much as $18 billion into espn plus and make sure that is, as bob said, differentiated content that is what the company is looking to do. make sure it is not just general entertainment everybody can stream >> what do you make of an outsider coming in a report in the post of adam silver >> i think that is intriguing. i know a lot of people have said that is not a possibility.

i mean, i guess you would question how disney would go about negotiating the next nba contract if they were negotiating with the ceo i'm sure adam would be a great candidate. i think the best ceo for right now is bob iger himself. i think we are all holding our breath as to whether he does step down on sticks around a bit longer and how long it takes him to resolve a lot of the problems he has ren rovating dishney and streamlining the company >> thank you, claire great to see you when we come back, more on "squawk box. tesla releasing delivery numbers over the weekend phil lebeau will join us to talk about that sryto next. reminder, you can watch or listen to us any time live on

the cnbc app

as we previously reported, it is now official endeavor announcing wwe and ufc will combine to form a $21 billion global live sports and entertainment company. aria manual will be the company's new ceo while vince mcmahon will be the executive chairman shareholders will roll all existing equity into the new company. that newly public company will be 51% owned by endeavor scott wapner has an exclusive interview coming up.

we are watching shares of tesla this morning the company reported quarterly delivery numbers yesterday, and phil lebeau joins us with a breakdown. the stock down marginally this morning. >> yeah, i don't think there's a lot of movement here, andrew, because the estimates for the most part they were all over the place as they usually are every quarter. some were saying tesla told analysts that the consensus was 422. fact set came in at 432,000. however you view this, slightly below, slightly above, here were the numbers in the first quarter coming in at just over 422,000 vehicles, up 4% compared to the third quarter. up 6% compared to the first quarter of 2022. there's no doubt that the price cuts in china as well as here in the u.s. during the first quarter certainly exacted deliveries it stoked the market, which is what tesla was looking for, though elon musk himself has talked about whether or not there's a whole lot of price

elasticity there in terms of whether or not you can juice the market the q1 production came in at 440,000 vehicles the focus now, dan ives at wedbush summed it up saying the big question will be margins as cutting prices will have an impact on this front, although we believe automotive gross margins over 20% remains the threshold. the consensus is for automotive gross margins excluding the 0 emission credits we get those numbers april 19th after the bell i don't think we're going to see a to n of reaction on shares. these numbers generally in line with expectations after the price cuts stoked the market, people expected them to be up around that 420 to 430 range. >> okay. phil lebeau, thank you very much, sir. >> you bet. before we head to a break,

let's take a look at the futures this morning you're going to see the dow is up pretty significantly, up by about 128 points and of course part of that is because of chevron being in the dow oil prices up by more than 5% this morning on that surprise news of a cut from opec production, that's got oil stocks across the board up s&p futures down by about 3, the nasdaq down by about 77. when we come back -- >> exxon's not in the -- i had to be reminded of that it was 2020 it came out for salesforce. >> by the way, when you said it earlier, it didn't click with me. >> next they're going to take ge out? the dow is so woke at this point -- wait, what? >> that one's gone too but check it out chevron shares up by almost 4%, gains from united health up by about 2.7%, and then the more modest gains from aterpillar, walgreen's which is also in the dow and intel. >> what? >> when we come back, we'll talk

more about crude prices, as we mentioned jumping after that opec plus surprise production cut over the weekend we'll be talking to goldman sachs commodity fguru we'll see what he thinks right now. get ready for trading in the second quarter billionaire investor lee couperman will join us with his thoughts on the market he's 20% invest insted in oil ai stocks right now we'll talk to him about that "squawk box" will be right back.

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good morning, oil surging after opec plus makes a surprise output cut goldman's head of commodity's research will join us with reaction. swiss prosecutors investigating the credit suisse takeover by ubs, details and a check on the regional banks is coming up. plus, disney holding its first investor day since the return of bob iger, a preview of what you can expect from today's meeting from analyst michael nathanson as the second hour of "squawk box" begins right now. ♪

good morning, welcome back to "squawk box" here on cnbc i'm andrew ross sorkin, along with becky quick and joe kernen. take a look at u.s. equity on this monday morning. we're going to talk about oil in just a moment. dout looking like it would open higher nasdaq down about 78 points. the s&p 500 off just about 2 points right about now we'll also show you treasuries you're looking at the ten-year and the two-year the ten-year sitting at 3.5. the two-year at 4.98 opec plus deciding to decrease or limit output, and that's pushing things higher e. you're looking at wti up 5, close to 6% at a little over 80 bucks right now. crypto, bitcoin, let's show you where that stands exactly. bitcoin sitting up now over

$28,000 again at $28,383. >> why would that be up with -- if oil's up and the fed needs to stay tough for longer, then bitcoin -- except if it's inflationary, inflation is why bitcoin goes up, so it's like always you can -- >> come up with a story. which side you want to be on. >> by the way, it for a while had been trading with tech stocks as a risk on. that's not the case today. it's indicated weaker. >> it also makes me come back to -- i don't know i lost my train of thought, but it just makes no -- bitcoin you can't really figure out which way anything's -- >> how it's going to be impacted >> how it's going to be impacted, and elizabeth warren last week sounded like charlie munger >> that's her view >> i didn't think she was so -- i thought for her if you disintermediate those nasty bankers, i would think that would be a positive.

>> interesting point i don't know >> there's two points, i guess, for everything >> yeah, there are as we previously reported, it is now official endeavor announcing wwe and ufc will combine to form a $21 billion global wide sports and entertainment company. ari emanuel will be the new company's ceo while vince mcmahon will be the executive ch chairman under the terms of the deal, existing shareholders will roll all existing equity into the new company. the newly public company will be 51% owned by endeavor and listed on the nyse. scott wapner has an exclusive interview coming up with ari emanuel and vince mcmahon at 9:15 a.m. eastern time >> the point that i was making that i briefly forgot was that i mean, if you're trying to deal with higher inflation from what opec is doing and you're the fed, can you really -- what is your tool to deal with a

production cut by opec >> breaking the economy so that there's less demand for oil. >> you need to slow down the entire -- as the fed, you need to try to slow down the entire global economy to handle that inflation. >> right, correct. >> that is not a good method for trying to deal -- >> no, it's not, but it's a limited toolbox. >> what's a better etd. >> producing our own -- >> jay powell's not in control of that. >> he was kind of complacent all along when we were spending 2.8 trillion deficit every year for the last eight -- or at least close to that. let's get to dom chu for a look at this morning's premarket movers any hydrocarbon producers in this. >> i would put them in there, but you guys addressed a lot of those things in the last couple of minutes

exxon, marathon, a lot of the oil and production companies in america, bidding in the premarket, no surprise given the oil headlines. a lot of other news out this weekend outside of the oil complex. we'll start with shares of tesla down about 2.5% right now. ore a million shares of trading volume it delivered nearly 420,000 vehicles, that's big in the first quarter of this year that's a 36% jump over the same time last year it's also a 4% gain sequentially over the fourth quarter of last year so positive on a number of fr fronts big numbers but they fell shy of some analysts' expectations and indicate a possible slowdown in growth at tesla. that's why those shares are down about 2% on those headlines. mcdonald's, shares are down fractionally, very thin kind of volume around 3 to 5,000 shares traded premarket the quick service restaurant giant is shutting down its u.s. offices this week in preparation for layoff announcements that

will come later on in the week that's according to a wall street journal report citing sources familiar it's not clear how many jobs will be affected but mcdonald's shares up about one-half of 1% in the premarket we're going to end with a merger monday deal outside of ufc and wwe, this time in storage, the physical kind, like storage spaces extra space storage will buy smaller competitor life storage. it's an all stock deal worth roughly $12.7 billion. life store shareholders get 9/10 of a share of every extra space they own they reject add bid from public storage. that's the reason why those shares for extra space are down 3% premarket, 5% gain for life i'll send things back over to you. switzerland federal prosecutor opening an investigation into ubs's takeover of credit suisse and examining leaks of potential breaches of criminal law by

officials, regulators and bank executives back here in the u.s., the latest fed report showing that deposits at small banks are stabilizing. joining us to talk about the banking sector is girard cassidy at rbc capital markets things look like they've calmed down, but i don't know how long they've calmed down for. what do you think? >> you're right, the numbers last friday that were released showed that outflow for deposits for the small banks was essentially flat grant t they were revised the prior week number, but still the flat number was very encouraging. i think as you pointed out, you know, it's maybe a little premature to declare victory, but i think that the deposit flight is over it stabilized for the small banks. but the large banks as you may have seen, also saw outflow which is not uncommon with what's been going on with the fed policy at qt. >> in terms of the policy piece on some of these smaller banks

what do you think has to happen or not, and tdo you think it ca happen with what the fed does or doesn't do to keep this simmering under the radar? >> it's an interesting question. when you take a look at what these two banks, signature and silicon represented, they looked entirely different than your typical bank, and when you look at the smaller banks in this country, when i say smaller, less than 25 billion in assets, and you look at the composition of their deposit mix, they have 60 to 80% of their deposits coming from depositors with less than $250 in each account, and that was not the case at silicon valley they had approximately 2.5% of deposits from those types of accounts so it was a very stable deposit base the may 1st report coming out of the fed and the treasury about what happened, there will be some changes no doubt, but it

will take some time. as you might remember when dodd frank was introduced that was sometime in the spring of 2010, so it takes time before they can put new policies in place. >> and as those policies get in place, though, how do you value these companies and. >> it's interesting because the stocks have sold off really hard, even companies that really didn't see the deposit flight that's, you know, obviously silicon valley and signature, so first quarter earnings, andrew, will be very important they start as you may remember with jpmorgan and other large banks on april 14th. and that's going to really help investors determine how to value these banks. right now they look very inexpensive relative to earnings but earnings can be revised downwards possibly after the first quarter results. but on a praise ice-to-book andc to tangible book basis, the stocks look actually fairly inexpensive. >> that's the question you said if you move out or you sort of, you know, look over

here on these unrealized losses, everything looks great if you look at the unrealized losses, obviously it's more complicated. therefore and given what you think may or may not come with regulation, these are either a screaming buy or they're still falling, right that's sort of the hard part to figure out >> that is true, and i would say that making that determination, believe it or not, is going to be more on credit quality later this year and into next year if they're screaming buy or they're going to feel more downside pain i really don't think the deposit part on the aoci issues will be the drives ofrs of that valuati >> what do you think about the pressure that's now on the fed in terms of the rate issue as it relates both to the banks, but then we have this issue this morning in terms of, you know, what's happening with oil production you're looking at the price of oil going up, that's going to make it harder for the fed. >> andrew, you're absolutely right. as you guys have been talking about this morning, as well as

the fact that the fed's primary role when it was created back obviously in the early 1900s was to be the lender of last resort. then it took on the role of controlling inflation and maximizing employment in this country with its policies, and inflation is the number one issue for them today now that this bank deposit flight appears to be over, i think they'll put their full attention on fighting inflation. >> excellent thank you so very, very much appreciate it. >> you're welcome. a quick news alert before we head to a break. the president of finland says that the country will join the nato military alliance tomorrow. finland's path to skbjoin nato cleared by turkey's acceptance last week. we return, oil prices surging after opec's surprise cut. is $100 a barrel coming? this morning we're back above 80 wti up by about 5.8% that's a gain of $4.40

crude up by 5.6% we'll be speaking to goldman's head of commodity research jeff currie about that move. at 7:30 this morning, legendary stock picker lee cooperman will be joining us "squawk box" will be right back.

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we're going to find out what he thinks of the recent bank turmoil and find out where he's putting money to work right now. and then, a big day for disney as bob iger gets ready for his first investor day since returning to his company we will speak to michael nathanson about all of it. "squawk box" will be right back.

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kind of interesting, that chinese spy balloon that flew across the u.s. was, in fact, able to gather intelligence from several sensitive military sites despite efforts from the administration to block it from doing so this is according to two senior u.s. officials and one former senior administration official and china has repeatedly said that the unmanned balloon accidentally strayed off course and was involved with weather monitoring i guess we've sort of figured we'd find something out eventually about this, but that's a little bit troubling, i guess. >> yeah, it is and i'm sure we'll find out more in the meantime, we want to take a look at the futures this morning. you'll see that the s&p and

nasdaq are indicated down, the s&p by about 3 points. the dow is indicated up by 127 par part of that is because of chevron with that surprise cut coming from the opec plus company, up by about 4%. then the other big gainer over the weekend is united health it's up by 2.6% right now. that came after late friday, the u.s. government announced that it would cut 2024 medicare reimbursement rates by less than expected it improves the rates it would be paying by insurers after pushback from the industry it now expects total payments for next year to rise by 3.3% from 2023 or around $13.8 billion. that's up from its initial 1%. the agency said it's doing this because in part it reduces incentives to cherry pick healthy beneficiaries and discriminate against sicker patients all the insurance companies said if you cut this, it's really going to hurt our bottom lines and we're not going to be able

to protect the elderly patients. >> more of an impact on the dow than severance. >> meantime, starbucks has some news they fired alexis rizzo, the employee responsible for igniting the starbucks workers united campaign. that move comes days after howard schultz testified on capitol hill he was grilled by bernie sanders. rizzo worked as a shift supervisor for seven years and she served as a union leader at the street store in buffalo, which was one of the fist two stores in the country to win its union campaign in that interview rizzo telling cnbc her store managers fired her after she finished working her shift on friday. she said they told her because she had been late on four occasions. in two of those instances she had only been late for a minute. rizzo saying she's going to fight for her job and wants to

be reinstated. oil prices surging on opec's surprise decision to reduce oil production by over 1 million barrels per day. that reverses their previous guarantee to hold supply steady. let's discuss this with jeff currie, head of commodities research at goldman sachs. we saw what happened with -- in the banking sector here. some people say that the credit contraction that could result from that was apparent to everyone, and i guess maybe it would even be apparent to the saudis do you think this was in the works before that happened was there already worries about too much supply with opec plus >> well, i think, you know, they've stated that this was motivated for precautionary reasons. you know, they have not seen any physical contagion into the physical market. what they did see is financial cont contagion. when we think about all those short barrels, that was creating

a paper glut in this market, and we have emphasized that opec's pricing power is higher than it has ever been and that they are going to continue to exercise that power why is their pricing power so high because of under investment in, you know, non-opec ex-u.s. as well as in the shale patch the rest of the global oil supply is in, but its inability to respond provides much higher market power, and they're exercising that market power but you know, but i want to emphasize that this is a revenue maximizing decision for opec under all the different scenarios. it was a voluntary cut it is a not violation of the agreement, and so when i think about what they were dealing with here is when we look at oil markets, there's physical barrels and there's paper barrels. this market was as short last

week as what it was during covid. i don't think anybody listening to, you know, this broadcast is going to believe the market is in that physical poor of shape as it was in april of 2020 what they were responding to is a precautionary movement to potential physical weakness but also, hey, they have the market power to respond to that paper weakness as well and as part of what we're seeing in that $10 rally last week, and the rally we're witnessing today is an unwinding of a lot of that short paper positioning. >> how much of this, jeff, will we see filter through to the commodities complex, the transportation index i mean, how much ripple effect will we have because you know, one of the bright spots in terms of the fed has been that we haven't had additional pressure there. it's been mostly in services and in the labor market. are we back now that the labor

market might cool, now we got to worry about the commodities complex again? >> we have repeatedly, you know, e emphasized now on this show for well over a year now, you know, these markets are severely under invested it doesn't matter if it's oil, gas, i don't know, copper, aluminum, pick the market. the reason why we see the price weakness we have seen over the last 6 to 12 months is because the world's largest commodity consumer, the world's largest oil importer, the second largest economy in the world shut down in the fourth quarter of last year it is reaccelerating it's going to put pressure on commodity and good markets are economists worried that that type of pressure is going to create inflationary pressures. your year-over-year comps are very favorable right now you'd have to see a rally well over $100 a barrel before it became a serious problem, which is why you have room for this to

run to the upside. when we think out further, you know, these issues around under investment in these sectors are real, and they're not going away the only thing that's going to fix them is substantial investment, and if anything, what we're witnessing right now is something that we've never seen in the sense that we have the trough of the capex cycle in commodities corresponding to the peak of the monetary cycle so the two are really misaligned right now, and that's going to create problems down the road. >> can you look at the spr depletion? i mean, we're kind of short. we're short that amount of oil, aren't we? that needs to be covered, when how? we should have started >> i think, you know, there was some political motivation in there as well in the sense that the u.s., praiices go down below $70 a barrel and wti down into the mid-60s, that the u.s. would respond to buy back those

barrels. they refuse to buy them back, and that creates a different type of risk asmet ya. another one that i would argue opec was responding to in this environment, but i think the key message here is when we look at the longer term sprs that are in the u.s. and, you know, elsewhere in the world, france drew down, you know, 11 million barrels this past week as well, so the total between u.s. and france over the next several, you know, months is somewhere around 36 million barrels on a, you know, exhausted, you know, 200 million barrel draw last year so we're using these barrels right now and france has pretty significant disruptions, but they need to be replaced because they're ultimately to be used for an emergency situation, and argue that they're no longer needed given what we're seeing in the shell page perhaps right now i don't think is a prudent decision. >> what is the current state of

just address russia and russian oil and we saw, you know, anecdotally that japan's paying more than the cap price for russian oil. how long is this going to last can we just -- this war's going to last forever, russian oil is going to be off the market forever? >> i think it's interesting opec had to cut even in the face of that what's happening with putin and his oil. >> well, i think when we look at russian oil, it is coming down, you know, in the most recent high frequency data. you're down 3 to 400,000 barrels a day. we continue to reach our baselines, another 2 to 300 to come down. but when people say, i don't know, never, they're ever going to consume it again, i like to point out people made the point that they would never consume saddam hussein's oil in 1991 and

by 1995, '96, they were consuming it again so you know, i don't want to say never on that, but i think in the very near-term, you know, it will be difficult to see a full return and i think the key point here -- and this is the point i want to emphasize -- russia suffers from the same under investment thesis that we're talking about the rest of the world suffering from and that's just going to make it that much more difficult when we look down the road for russian oil, russian gas, russian commodities in general to return to the market. they're going to struggle very, you know, near-term, and the lack of the investments they're eventually going to bite it in terms of its ability to respond medium to long-term, never say never. history says these commodities do begin. >> joe manchin says a lot of the ira money that was supposed to

be spent on hydrocarbons is being diverted into renewables against what he thinks is wise could we be doing more could we be investing a lot more here still, jeff i figure most of the oils are doing it on their own. most of the companies are induced to do it on their own. they don't need any -- >> look at the rig counts. there's a select few companies that are actually growing production and by the way, it is not just isolated to hydrocarbons it's the entire commodity complex. you know, by the way, with the higher interest rates, you know, even or stead's having problems with some of its green products. commodity production, supply, oil, gas, metals, agriculture, it's all under pressure right now, and by the way, i've said this before on this show, it may be green reasons, esg reasons,

but the primary reasons, these sectors have a history of bad returns and it's those bad returns that has prevented investors from coming back to the space. and the only way you get around high bad returns is demonstrating good returns, higher prices and that will ultimately track the capital back to the space, and that's what we call the revenge of the old economy. we took our price forecast up $5 a barrel. >> you did, okay all right, jeff currie, always appreciate having you on thank you. >> great thanks for having. still to come, our exclusive interview with billionaire investor leon cooperman. we're going to talk to him next. plus, senator joe manchin is going to talk everything from the debt limit to inflation and more stay tuned, you're watching "squawk" and this is cnbc. prevan

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our next guest says that he had been anticipating a crisis of some sort and that the u.s. is now in what he calls a self-induced crisis. he calls it textbook

joining us right now in an exclusive interview is lee cooperman. we haven't gotten the chance to talk to you since all the turmoil that broke out in the banking industry what do you think is happening right now? >> well, i think we're finding it much more tidifficult to gett 2e as we realized. we've had irresponsible policies for a decade, 0 interest rates i did not forecast the banking crisis, but i did say this will end with some kind of crisis, it usually does and we had the banking industry. and we've had the predictable response by government to that crisis, and i suspect long-term consequences are going to be more negative than positive mainly because i'm a free market capitalist, and i have to say that if the government is goin to be looked upon to modify downside risk for companies, the

government has every right to modify the upside return >> do you see this spreading beyond the banking sector into other arenas, and how long do you think this plays out if you're talking about long-term consequences >> well, i think of commercial real estate as banks become more reluctant to lend. we'll survive this generally market bottoms are made on bad news, not tops, so i'm not surprised about the rally, but i think it's kind of running its course. >> you've been concerned, the last time we talked to you, you worried that you could be stealing seven years or more returns that we've already seen and that the next seven years might not be so great. are you still feeling that way >> yeah, i'm not a big reader of the bible, i am a god fearing person, you know, but i basically cited pharaoh's dream

which was interpreted by joseph as indicative of my thinking, and we have seven lean years followed by seven fat years. i think price ratios are heading a little bit south, and i thought that the combination of lower oil prices, the combination of higher oil prices and qe fed tightening, and the strong dollar would lead us into some kind of recession, which would give us a file bottom later this year in the market. i think the back down of oil prices and the weakness of the dollar might extend the runway a little bit i have an overall cautious view. i think we've had economic mismanagement for quite some time, and we still have it this whole energy crisis could be dealt with if we just gave some economic incentives to the oil companies to produce rather than trashing them same thing, you know, i've had this i studied stock repurchase for a

long time, and i happened to be a great admirer of warren buf buffett. i think he said or a demagogue. >> there's an adjective for the silver tongue of the demagogue. >> the basic point, getting involved in business in a way that i think is unhealthy. stock repurchase is just another use of capital by business so you know, you have to judge that use of capital as you would judge their decisions to invest in capex, m&a, stock repurchase, dividend payments, et cetera and you've got to decide whether the companies are in a better position to make that allocation or the government, and i would think companies are are in a better position to make that decision you got to decide whether you're a free market or whether you're looking for a controlled economy. ask i and i think we have the economic system of the envy of the world, and yet we have a bunch of

politicians that don't see it that way but getting back to my -- i think we've had irresponsible fiscal monetary policies for a long time. i mean, we were buying mortgages when house prices were running ahead 30%. that made no sense then all of a sudden we woke up to the inflation problem 64% of a typical business cost is labor, and with 1.7 jobs available for everybody seeking a job, it's not an environment where labor is going to moderate its demands greatly. i think inflation can be higher than we think and i said this in my last appearance, i have no particular insight, but i don't think powell or me or anyone knows how high interest rates have to go to stem economic growth you know, i grew up in a business where there used to be a real return when you bought a ten-year bond. the return equaled or exceeded nominal gdp. if you say inflation of 4%, and

real growth of 1.5, that's 5.5%. >> maybe not the real rate, i guess the question is how quickly we got there >> yeah, i agree with that, you know, we didn't understand the consequence of holding interest rate to 0 for ten years. we didn't understand the consequence of raising them so dramatically, so quickly you know >> right it makes sense lee, let me ask you about oil. i was surprised to see that you're 20% in oil and oil stocks i knew you were big in oil stocks i didn't realize you were that big. >> yeah, yeah, we've been there for -- it hurt me so far this year it will help me today. but my basic view is very similar to jeff currie that spoke a few minutes ago on your program. i think world travel is going to come back, which will stimulate demand china is going to come out of

lockdown we're no longer going to be dep depleting the strategic petroleum reserve, and most importantly we're not replacing reserves in line with production so that's going to keep an underlying bid in the market now i found over many years of doing this if i bought things 5 or 10%, three times cash flow i tend to get lucky, so you know, what worry me, to be honest with you, is i took this position two years ago. it worked beautifully last year, and, you know, nobody liked -- and all of a sudden on your program eff tvery talking head t came on emphasized angie at the top. so we've had this correction, and a number of large positions, you know, i have devlon, my favorite is paramount in canada

s my second favorite is tourmaline run by michael rose you look at paramount as no debt it yields over 5%. it's growing production at 15% there's a course of production of $31 a barrel, and you know, i would say i go long on something like that. a price collapse, we're not getting a price collapse, and they're making a lot of money for every barrel of oil they produce, they're generating $2 million a day of free cash flow so you know, that's where i'm making a bet >> someone -- >> very -- my second business, biggest position i've been dead wrong on, but i actually think it's a fabulous idea and this is -- the government should be ashamed of their behavior here

they have slowed dowe whole process by lying the department of defense for five or six or seven years alleged that the spectrum that la gateau owned interfered -- the fcc -- allegations of five years, five years, and after five years concluded that the allegations were incorrect, and they approved the use of spectrum in a 5 to 0 vote. now the department of defense changes their hwhole story. i have no problem with that. they've got to pay for it. ask they've been reluctant to come up with an offer and ultimately they'll be forced into making one and the offer is going to make the bonds worth par and they're e trading at $0.31 to the dollar. >> how many did lagato pay for you're saying it's worth how much $30 billion? how much did lagato pay? >> less than 30 billion, but the

value, they've invested a great deal in the sfekpectrum. >> it's the government isn't there the chance the government says here's your money back >> they have done everything required of them in investing in spectrum these are very real people ivan seidenberg is chairman of the board. lee hunt joined the board, former chair of the s.e.c. >> former chair of the s.e.c once the government gets involved there's no sure way of knowing how things are going to work, right? >> you have to make a judgment i'm in an ideal position i don't have client money. i don't have to worry about redemptions. you have to make a judgment and the government takes something worth $30 billion for nothing. i've had three -- visit me in the last year and a half down here in florida. jeffries, gtib, and stonehenge the company said spectrum's worth about 30 billion

all i know is the accretive value of the first liens at par but the paper ahead of them is less than $6 billion, so i got something, i got terrific asset coverage and my only concern is can the government take something for nothing. i don't think so if they succeed in doing, that we become a banana republic. >> you think about government does stuff like that all the time where they say, okay, your land's worth x amount. it's not a sure thing, obviously, or that's why -- >> nothing is a sure thing in life that's why i trade the paper matures november 1 it picks away at 15.5% if they don't pay off november 1, the coupon goes to 17.5%. i'm willing to be patient. i think at the end of the day, the government's going to pay for it, and they could pay for it very quickly. this could resolve itself in a matter of weeks, not months or years. i agree with that. at the end of the day, i believe

the government will have to pay for it. >> lee, let me ask you someone wrote in on twitter and said the last couple of times you've been on, you mentioned about the market being broken. they asked for an explanation about why you think it's broken and how. >> yeah, well, basically about, you know, i lose track of time about five years ago i wrote a letter to jay clayton and i said, look, the market structure has changed and you guys should recognize it when i came to wall street over 50 years ago, goldman, jpmorgan, solomon brothers, they traded stocks at $0.50, $0.60 a share with commissions being near xerox brokers can't stabilize. secondly, 50 years ago 80% of the volume was done onboard by the specialist system. now 80% of volume is done off board. and thirdly and most importantly for some unexplained reason i think in 2007 i guess it was or '6 that they eliminated the uptick rule which came into

being as a result of the abuses of the great depression, 1938. it served us well for 70 odd years, and then they took it out and gave rise to all the mechanical trading systems so you know, these traders that use algorithms, knew everything about price. they know nothing about value, and it's created a tremendous amount of volatility in the market i said why don't you give it a shot, reinstate the uptick rule for six months and see what happens to markets they ignored me. i'm a great letter writer but i don't get any responses. i i've p written to president obama about his telling 99% are being screwed by the 1%, rather than telling the 99% with a lot of hard work and luck they can become part of the 1%. i came out of the south bronx. i had nothing, you know, and i got very lucky i worked very hard, but i got

lucky. i used great intuition, and i became successful. that's the american dream, and we're getting away from that, that's not a good thing. >> lee, want to thank you for your time this morning it's always good talking to you. >> nice to see you one of these days i'll come in the studio. >> do, let us know when you're in town. >> my kid is throwing me an 80th birthday party. >> come in and we'll celebrate here too. >> thank you, that's very nice of you stay safe, stay healthy. disney up 9% since bob iger returned as ceo, it's going to be his first investor day, we're going to have a preview of what that meeting could be and what it all means for the business, shehde aarolrsnd more. you can get the best of squawk on our daily podcast follow squawk pod on your favorite podcast app and you can listen anytime we're back after this.

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coming up, we're going to talk all things disney with analyst michael nathanson, and then in the next hour, in his wall street journal op-ed last week, senator joe manchin said while we can all acknowledge that raising the debt limit is an absolute necessity and republicans shouldn't threaten

others, are we seriously to believe there's no room to negotiate? breaking ranks with the board collective this democrat we're going to find out when we speak to the senator about possible negotiations and much more we'll be right back. we'll talk to the senator about that and much more we'll be right back.

disney hosting its annual investor day today as bob iger hopes to cut content spending.

joining us is the founding partner and research analyst good morning to you. what's on the table here what are you hoping to hear? what's the one thing you'd be surprised maybe even if you hear >> well, it will you what happens to hulu. i'm not expecting anything today on hulu. but bob's idea that he doesn't need hulu or want hulu we'll see if comcast will buy it >> your expectation is he sells it your question is therefore to who, how is it the shell? does it come with content, a long-term licensing deal those are the big issues that it relates to as far as i understand it. >> right we don't think he's going to be the seller, that comcast

investors don't want him buying hulu i don't think bob has a natural buyer for hulu and integrates it with disney plus but it's not clear what happens to hulu. and they can't talk about long-term profitability of streaming until they figure out who owns hulu. there's a conversation that's been the narrative but i don't see a buyer. again, i think comcast, the stock would be hit hard if they did buy it from disney >> one of the other things i hear all the time from investors in disney who are looking at this hulu issue is how connected do you think the bundle is, meaning hulu and espn plus and disney and how hard it is to unconstruct that bundle?

>> 40% are bundled and they enjoy a deep discount because of disney plus and hulu together. we believed that disney plus is a narrow target. i think it would be a mistake to get rid of hulu. i think it would to your point reduce the potential audience of disney plus by not having entertainment attached to it it interesting that bob threw it out a couple months ago and now we're all waiting to find out what's going to happen to the thing. we had hoped the stock would rally even more because of the leadership i think people don't know what to think about hulu. >> there's two other topics on my list. one is espn and the commitment to sports and what that ultimately looks like. is there a partnership with an

outside betting company or something? and then the other issue is do you think he will or won't address this brouhaha that continues to take place when it comes to the parks down in florida and what's been going on over the past well now week but sounds likes several months this terms of this battle with desantis that i'm not sure desantis even realizes what's happening. >> on the second point, i know bob well he's not going to spend time on that issue because he doesn't want to solidify it even more. he watched what happened with his predecessor, getting caught up in politics i think bob is going to steer clear from that. as you know, he's grateful to not be brought into that on the first point, espn again, it's a bit like hulu, the question is not do they want to

own espn, my feeling is they have a ufc deal coming through, long term they'll have very thin profit margins because of the sports costs we think the best bet is sports gambling but it's going to take some time. they'd have to show some cost control and find a partner >> michael, we got to run. appreciate your perspective. we'll be watching all of it today and i imagine talking to you about it very onso as well thanks >> coming up, senator joe manchin will join us next to talk the debt limit fight in washington "squawk box" will be right back.

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good morning a big surprise, oil output cut from o'peck. and it is merger monday. wrestlemania meets ufc

and senator joe manchin will join us as the final hour of "squawk box" begins right now. this really is alphabet soup good morning welcome to "squawk box" here on cnbc, live from the market site in times square. wme finds wwe to combine with ufc. i mean, omg. do we ever need to -- >> very nice, very nice. >> wtf, man. >> are you going to do the rest of the show in three-letter -- >> is that what it's come to you know who really can do that? young people they say things and i don't know a lot of them and i look them

up and they're good >> i'm joe kernen. lof. >> this is good. >> i'm j.k. along with dq and equity futures, they did that so fast chevron and united health care is what we're talking about for the divergence there treasury yield, it would be an oil story today probably if you were going to try to and figure out with equities, energy prices are strong following a surprise cut from the opec plus group and talking about over how many million barrels? it's over a million, i guess >> 1.1 million >> that's significant. not very nice considering all

the treaties we've made with the saudis they don't really care what we want that much this is self-interest more than anything else. we'll have more on this story later this hour. >> we have some breaking news, though world wrestling federation -- i can't call it federation anymore. it's wwf to me i know it's wwe now. it's merging with ufc to form a new company. wwe shareholders will own 49% and devers will be the chairman and vincent mann will be an owner. we're going to speak with an analyst about all this in just a couple of minutes. >> we want to get back to the markets as we begin the hour we go over to mike to see what

he's watching. mike, i guess oil has to be front and center >> yes starting the day, the hour, the months and the quarter we had a strong finish in the s&p 500 in march, in the first quarter. it actually looked a fair bit like the end of january, just kind of an acceleration into the end of the month and if you remember, he had a couple of days of follow through there, february 1st and 2nd. we did pull back after that. rates bottomed and started going up from there. i would say we're a little bit overbought in the very big cap indexes, especially the nasdaq in general the market did broaden out. the big story has been mega cap tech stocks. last week there was a little more rotation. we're seeing attempts at rotation away from the big nasdaq stocks. top of the range is the story with the exception of that burst higher in august that was

stopped by the jay powell speech 4,200 has been the level we're about 2% from there. maybe a breakout attempt we'll see. leadership this takes you back to the october low. the semis just really up and away from that moment and way outperforming the equal weighted technology sector. you might think this is all nvidia it's really not. the stocks index etf is actually more balanced. it's only about 8 or 9% nvidia at this point. semis are more or less a market performer. take a look at energy. we looked at this relationship a few times here the xle, the energy stock sector against wti crude. back in the middle part of last year, you did see equities outperforming crude.

now it's looking to test the top of its own ranks $80 on wti, it obviously has been a range-bound area. i think the stocks have been outperforming because this market has been really rewarding anything with free cash flow, with more predictable earnings and a lot of the energy companies, the big ones, do have that right now >> we talked about energy. if you look at the dow the reason the futures are up so much, not just because of chevron being there, also united health care. there was a story i guess on friday about you the government is going to be paying a lower than expected 1.1% average cut for 2024 reimbursement so giving more money than had been anticipated >> unh has a very big influence on the dow itself but probably would be a beneficiary if we're going to see a little attempt at

rotation away from just a handful of big growth stocks as we saw last week that's probably where it would probably flow. we'll see how it evolves over the course of the day. >> thanks, mike. >> our next guest recently wrote an on eed for "the wall street journal" entitled "biden's inflation budget reduction act betrayal." and they say that they are working in a partisan way to increase spending on their own priorities joining us is west virginia democrat senator joe manchin it was calmly written, senator welcome. great to have you on i could detect a little bit of -- how would you characterize it you weren't happy about some of the recent developments. >> that's to say the least i wasn't happy the president and all of his members of his cabinet, they

knew exactly why we proceeded with the ira after the bpp was killed, which was an jove reach as far as i was concerned, it would have been catastrophic as far as putting that much more money into the marketplace and changing the cycle of services we would be giving to people i couldn't do that then come back and do something such as this, this was really instigated by what russia did, the war on ukraine and using energy as a weapon, joe. so i we weren't energy independent at that time you can't eliminate something

until you have something to replace it we talked about all of this. we have to start paying down our debt and make an attempt to pay down debt and show people we are serious about the crippling debt we incurred. we did that the first time in 20 years and bring down the cost of drugs and put caps on insulin. a lot of good things we can do we all agreed. everybody agreed, joe. and then all of a sudden i said the most important thing is we should not be relied on the supply chain that we have no control over they were wanting to move to electric vehicles quicker than i thought any way possible that we could and be able to provide a source and security that we would be able to manufacture in america. so we start putting that bill together nobody knew about it because i neff thought they would pass it or accept it that started in lay march but by june things got worse.

inflation had gotten worst with the cost of gasoline then it comes into agreement that's what we should do i said why should we dependent on china and batteries when we can produce it ourselves why should we be held hostage for securing our critical needs. all of that was agreed upon. they didn't hit their goals by january 1 and they started liberalizing so they could get more product out and put more

money in the way >> you take it to what this means for our overall debt picture, too and i haven't seen many of the people in your party, it's pretty solidified democratic party but for you to say, okay, republicans should not threaten otherwise that we're going to do this debt ceiling but then you go on to say do you really think that there's no room to negotiate? and you're really urging president biden, in my view, taking speaker mccarthy's side in this. as a democrat when he wrote that letter a week and a half, two weeks ago where he said, you know, there's things that we can do, it's insane not to negotiate with $32 trillion of debt, it's insane not to try to negotiate we're not going to -- the debt ceiling is going to get passed and get done but sit down and net with us. you're telling the president to do this. it's not going to happen now we're far apart, senator

>> the only side we should be taken is the side of our country. it makes common sense if you have a debt structure and we've accumulated more debt in the 20s, then here have gone -- create so much debt so quick can't we look and see if we can stop that basically and go back to some normal times we understand that it is what it is can we go back to some normal times and basically look at what hasn't been used yet all these things that we talked about. i'm thinking the joe biden that i know has always been willing to sit down and talk he's always been a person who led the charge in the senate when he was here i've been told, i didn't serve with him during that period of

time but i was a governor at that time. he would always sit down archand someone is basically telling him politically. the only hand that's going to be playing out here is the uncertainty of us hitting a debt ceiling and not being able to settle that beforehand that shouldn't happen. we all know we're going to pay our debts and secure the good faith of our treasury. we're going to do that and -- >> you go so far as to say and rest not the interests of extremists in our party in mind. that's a loaded point that you're making there, and there

are i guess a lot of republicans that have been the criticism, that president biden is not the president biden that you would have known when he was a senator if you hadn't been a goffier that's. >> i think the president knows that i think he's been pull too far left you cannot run the country from the extremes i think the extreme right, the grand ol' party isn't quite as grand as she was at one time and the democratic party that i grew up with and believed in is not that party today we've been extreme >> are you still a democrat, senator? >> i'm not a washington democrat and i've got a lot of friends at home -- >> did you leave the democratic party or did they leave you? >> i think both parties have left our tradition of what we

were and what we have been and but you could always come back to the reason responsible, sensible middle with the exand that's what i'm pushing against. i think there's people like myself that are just tired and fed up they can't take any more, joe. every and we continue down this path of making everything a crisis when it we paid down debt for the first time with inflation reduction act. of. >> nor. >> he's got some members of his caucus that have him in a certain -- i don't know whether they have him oaf a barrel

he has to listen to a lot of different people and then you've got the president and we see what he's been saying. there's no room for negotiation whatsoever with a little bit of tremors in the financial sector, you see what happens you can imagine what a debt ceiling issue would do to financial markets? beau siding i appreciate odd your -- i'm talking to people on both sides of the aisle. somebody's got to comfort. i think we can do that >> everyone's afraid and use it against you in the political election next wob only in america do you start the next election the day after the last election i can't believe that and next we have to do our job this year.

we know 2024 is going to be a high stakes election year. can't we get through 2023 and put our house in order that's all we're trying to do, joe. >> i saw from the weekend shows, you said it's a possibility for you to seek national office. you said you won't think about that until the end of this year. >> my god, we're going to have the next 48 hours. >> i don't think people in either party are that enamored with the current choices for a while i thought you made people mad on both sides you made republicans mad when you finally went into the -- you made democrats now that might be what we need now is someone who makes both macedonia long i truly believe there's the eye lent majority about wanting to rumble wait a minute, can't you do your job, can't you get your budget done on time

just join our process. they all know this by the 1st of february, the president is supposed to have his budget out, by law by april the 7th they're supposed to past the budget on time just doing that saves billions and billions of dollars. just put a cup on our spending discretionary spending, we make choices on how we spend money. can't we at least say we're not going to grow that more than 1% a year for the next ten years? that saves trillions of dollars. nobody wants to talk about that. they're saying, oh, the big elephant in the room is social security and medicare. we're not going to touch social

security and medicare but we better find a way to stabilize it because the next decade people in west virginia depending on that as a lifeline are going to be in trouble i don't want it cut. i'm trying everything i can but let me tell you the rumbling that i'm hearing wait a minute. can't we do something better can't we force these guys out of their respective corners and come back and maybe some decisions that help our country? and no one's talking about that. we're demonizing everything. and we're rewarding bad behavior >> you are and we'll always have davo but now you're here when you're speaking to the squawk audience, you're speaking you need to reach. >> the people we're talking to now need to speak up

>> until they demand more, andrew >> senator, thank you. hope to see you soon and in studio. there's a place right here >> coming up on the other side of this, the wharton school professor jeremy siegel will be with us. we'll talk markets with him and a top media analyst will weight in on the merger of usc. stay tuned we'll continue the brawl right here on squawk potlights. go stadium lights. emerson software helps clean energy become reliable electricity. go “good night." go boldly. emerson.

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welcome back to "squawk. world wrestling entertainment merging with ufc to form a new publicly traded company. joining me is brandon ross we should note that peacock

owned by comcast carries wwe events such as wrestlemania is part of a long-term deal with the company. brandon, i'm so curious what your first reaction to this deal is >> sure. it's basically the deal that everyone has thought was inevitable for a really long time vince mcmahon wanted to be back involved in the company. this deal gives him the ability to be executive chairman aria manuel has been eyeing this asset even before strategic alternatives were announced when vince had to step away from the company. also in terms of its inevitability, i don't think there were necessarily any other buyers of wwe based on the work that we had done going in. >> that's an interesting question

if there were no other buyers, is this a fair price is it too rich a price >> well, you tell me really what the price is there's obviously headline numbers on this, but it's a reverse mortgage trust with equity contribution and the market is going todetermine what the price is. >> do you like endeavor after this >> i do actually because i think this is going to highlight the value of the stub and investors have been valuing all of endeavor too inexpensively that's saying the implied valuation on it is like five times this transaction, it's got to be worth eight plus times i think this is good for endeavor shareholders. >> what do you think endeavor becomes them you'll have these two companies now separate and they've been able to leverage the ufc piece

of that for some time. >> i think the ufc will continue to leverage the endeavor peace and already manual's involvement in ufc is going to help him to be able to get sponsorship deals for wwe and ufc, in terms of media rights, negotiations, et cetera i think we're going to work together >> given the history of vince mcmahon and the allegations made against him, whether that creates any issues for the endeavor team? >> it's possible there's also the issues that came about with kevon white. my guess is as time passes, that will kind of fade into the background the first question now is the media rights deals that are coming up for wwe. and who are the buyers for those

deals? is it going to be your parent company, comcast, that continues with raw is it going to be fox with smackdown? or are there any other bidders for those rights if there are, that could be a robust outcome, but if there's not -- >> and what's your gamble there? >> my bet is that this winds up exactly where it is right now, with the rights being split by comcast and fox. i don't as of yet seen any streamer that is aggressively coming in and bidding on these rights >> why do you think that is? >> it's interesting. i don't know because this would be perfect for maybe an amazon, right, where they're trying to win nights of the week they brought thursday night football over. you could add on a friday or a monday but -- and there's a ton of tonnage

i'm not sure perhaps more interest will come about in the next couple weeks >> and what do you make of the scuttlebutt or proposal potentially for wwe, for example, to add betting on top of what's going on this is a scripted dramatic piece, betting on a scripted dramatic piece kind of a strange development if in fact this is where it is all going. >> i think that's really a side show i don't think that would add that much incremental value to the wwe property at the end of the day, unless it added engagement, right? but there's so much risk with that that i don't think it's really worth pursuing. at the end of the day wwe's value is what its media rights can generate

>> brandon, great to see you >> thanks. >> thank you >> what do you think >> i told you, you know, you laugh at me but i've seen "wheel of fortune" because it's on after "jeopardy. they can make a star, wwe out of -- they're in good shape but they weren't like behemoth so they manufactured -- >> you don't need the ads? >> you if ever sell wwe short over the last 30 years, you have lost your -- and there's times where i thought is this? now i give them the benefit of the doubt. there are people they'd kill, ground hog day wwe. wrestlemania >> i'm going to have to put it on my bucket list.

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shocking markets with a surprise oil output cut, brian sullivan joins us now with more. you just eat this stuff up, bri. could we cover this tonight at 7? >> we will, joe. we certainly will. by the way, i heard you guys talking about "jeopardy. i was like what's that we're watching "live call" at 7:00 >> i'm sorry but i need to think about that i tape "jeopardy." >> thank you or tape "last call" for $400 alex, what's our favorite show thank you, opec plus for ruining everybody's weekend. the saudis and other opec nations announcing oil cuts.

russia planned another cut and combine those, you could get to a total cut of 1.6 million barrels per day by the middle to the end of the summer. that would be about 3.5% of global demand. in a very brief statement the saudis said they are looking to, quote, stabilize but whatever they feel, they're clearly not happy with prices. prices have hit lower, hitting $70, 15-month lows would this full million barrels or more be taken off the physical market? we don't know. when opec announces a cut and use things like a million barrels or whatever, it's many that many. everything i've read puts the total physical barrel removal, lack of oil supply, probably within 700,000 and 900,000 barrels per day totally physically being taken off the market, kind of a reversal of what the saudis themselves even said just a couple of weeks ago.

i got to tell you, i can tell you somebody at 1600 pennsylvania avenue, president biden clearly cannot be happy about this do you remember in october when the group did a 2 million barrel a day cut, he said there would be consequences. it reported perhaps the saudis are upset that the united states did not make a move to buy more saudi oil to try to refill the strategic petroleum reserve. the oil stocks moving up >> that chart, we keep showing that it's not a coincidence that that was sort of a new intermediate term low all of a sudden it go down below 0 70s and mid 60s. i guess they were thinking about it that seems like a good time to do it. we're short. we talk about that with jeff curry. we are short

short a lot of oil that's got to be covered someday it seems like, brian and other countries, they're short, too we're short. >> and if you do the math, so let's say you cut 1.1 million barrels for the next 60 days and 1.6 million barrels from july till the end of the year, you get to a number of total barrels removed off the market, 350 million or whatever it is, that is roughly the amount of barrels that would be needed to refill the spr. so if you look at the numbers, they could be fairly aligned it could be random math, who knows. the ftr is a big deal. you have jennifer granholm who said in a hearing about ten days ago that, quote, it could take years -- her words not money --

to refill that fdr but you have special envoy for energy security who is probably doing the work behind the scene, maybe trying to convince them that maybe we will buy more saudi oil. you wonder if there's a disconnect at the highest levels from what the saudis are hearing from different parts of the u.s. government, particularly on the inside >> we're in a difficult position to curry favor with good reason with can i showingy they remember that and it just not a great. >> meantime, i want to talk about the potential inflationary impact of opec's cuts and what to watch for as we start the second quarter

jeremy jeremy siegel is here. we now have inflationary pressure, you were just hearing from brian, as a function of what opec is doing i don't know if that was in the fed's calculus and, therefore, what they're going to have to do about it >> that's true, andrew but remember, the fed mostly watches core inflation, which excludes the food and energy component. secondly, the u.s. is virtually energy independent as compared to europe and japan and other parts of the world so we do have a lot of offset. i mean, we have a lot of producers that are getting gains that aren't in other countries we see the jump in oil stocks. i think something that was interesting to me, natural gas today, which by the way is more

important for heating and electricity generation, that's bumped to new lows so a lot of our energy, at least in the near term, is not going up i actually don't think this is going to be a major issue. i mean, again, the saudis did that to offset the decline because of the fear of recession, you know, caused by an overtight fed and they're just bringing the price back up to where it was two months ago >> so where are you, therefore, on the larger equity piece in the market we were talking about liam coopman earlier. he has a flattish to potentially dower view, not a bullish view, particularly when you look at the indexes. >> as i said last week, i was

really disturbed the fed's official forecast that it gave in its march meeting is for negative gdp growth over the last three quarters this year, which 0.4% for the year and we're going to have 2.5% to 3% it's hard to be really optimistic about equities if the fed wants to design a negative gdp growth maybe they don't understand their own forecast put it to them, mhey, do you knw what you just forecast certainly that was not a a positive forecast. it is going to be hard for equities to make progress. >> we've been speaking for years. you have historically been on the bullish side and, by the way, on the right side

things typically do go up over time when you think about sort of your outlook, is that a six-month outlook, a 12-month outlook? where do things sit for you? >> well, i think that would be three, six, nine months. i actually think that i'm more optimistic for 2024 and 2025 i think the valuations of stocks look good to me in the long run, long-term holders i don't think should be frightened it hard for me until the fed sees, you know, what the effect -- and by the way, what's interesting is that the data we're going to get, we're going to get the labor report later this week and a lot of other data it actually means less now than it did before svb because all the data we're getting now doesn't reflect we're not going

to really get that data until very late in april and may may 3rd is the next fed meeting. they'll just begin to get that data so in a way, you know, everyone looks at the labor report. i will look at the labor report. but, again, it will not reflect what has happened in the banking sector and that's a chill that i think the. >> the question is so many of our viewers and we've talked about indexes, everybody buys the s&p. they buy the dow right now you would just wait -- you always say timing is not a friend i'm not a market timer i see a hard time seeing, you know, a lot of positive factors

that can propel over the next three to six months until the fed i think gets it and realizes that their tightness has in fact cured the worst of the inflation problem and they begin to not only pause but actually lower rates at the end of the year until i see that, it hard for me to see a gain hort remember. but. it's really tough. i'm still very optimistic for season 2024, certainly for a three-to-five year horizon going forward. >> president siniegel, always gd to see >> coming up, we're talk to talk to cramer and maybe get some thoughts on this wrestling deal of the morning stay tuned, we'll come right back vices, orchestrated by cdw.

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let's get down to the new york stock exchange. what does the opec move today say about where we were and about what's likely to happen in terms of inflation and how the fed reacts in the future it's kind of interesting >> sure. i think first there is a degree -- like the president we thought was going to try to refill the spr he didn't start buying that would have taken a lot of

oil off if he had done it but i feel it's not as relevant. i don't know how much this will matter because the economies are around the world are getting more anemic, except for, as we said, china. i think i would sell some oil stocks it because i think that they can take off that much and we could quickly add that much if we wanted to so i know it's significant but only for shock value i don't think oil -- i think oil could go to 90 but at that point, you'd really have some resistance the economies are not that strong around the world. so we fuel these stocks up but they've been fabulous shorts all year now the shorts are kind of hung. >> for disney -- for bob eyre to do everything needs to do at disney -- i don't know where he's going to start. 18 months is not enough to do

it i here goes on one of those -- what's it called >> versifier i do five minutes and i'm crying he does that for like 45 minutes. >> if he committed to that -- >> maybe he doesn't want to. >> you have to find where mark parker is in this process. >> he can say the business is bad and they'll say it's good. >> big decisions to make, though >> if he just says i'm going to get under control and we're. >> hey, what do you think of wrestling? which stock do you want to own >> i actually of so it's

difficult. i need to hear what scott says i want to wait for the interview it's not clear which is new co, old co i think scott's interview will tell us everything >> i never understood the synergy of usc with wme. that was a e, have very important relationship for ari and for the debt and for everything else. >> the excuslusive interviews. that would be terrific >> ufc a lot of the, it's like gladiators that gets a lot of.

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>> that's billionaire investor lee cooperman joined us earlier reacting to the recent sector turmoil. for more on the market, let's bring in vice president dan shea at options trading would you change any of your outlook based on opec plus, danielle >> no, i wouldn't. what i'm looking for this month is a seasonal rally into earnings, and this has occurred despite ongoing macro economic conditions and look at the bear market microsoft and apple, they're charging along and will be hopefully retesting august highs coming up here soon. >> everybody comes on. those are the two names that you

have need to watch and the team to lead the technical stocks and the overall market higher when push comes to shove. so what -- how do you watch technically what goes on with microsoft? do you watch calls, do you watch. >> yes, definitely i like to lock at volume and i also like to look at the way these sox rackets. you with love to i would look at the technical resistance levels that come in overhead in august. i'm also looking at amazon and netflix. they're a little bit on the weaker side. however, when i'm looking at volume coming into tho and i think that they have some room to return going into earnings.

in their iin from we also have seen some and being be, either got disillusions or ran out of stimulus money or something. are you noticing that in your work as well >> oh, definitely. we've seen investors get resolution off the bear market i like to tell those people that these are the best times to come in and be when you're looking at your long-term 401 k balance what i hike to it f. that means that you have a lot of runway to the up side

might equities will continue to go higher. >> you just were talking to jeremy seeingle. does via long career in stocks go up over time dk back in the 60s i think or the $32 trillion in debt that we have, any of those do you worry about in an overhang long term for kick it frm specifically as it relates to mood going into earnings. of a we have this earnings season, i'll put out that way is, in april following along

with the overall pattern and it will if so if an older but a goody, goody, ban yell. >> we're going to have that exclusive interview about the "wrestlemania" host and more "squawk box" begins right now. good monday morning. welcome to "squawk on the street." futures are mixed after opec gives us a surprise abduction number we'll still get the jobs number on friday. the ro