that's all for this edition of "dateline." i'm andrea canning. thanks for joining us. [theme music] good morning and welcome to street signs. i'm giuliana cattlebaun and these are your daily signs. saudi arabia's energy mystery valves to do what it takes to serve the market.

>> we are optimistic about the future. >> we will hear from the andriy sadovyi the -- opec secretary general in the hour. cabot payments makes its debut on the london stock exchange. the ceo tells us that london was always the first option. >> this is a good location for us. the bulk of our employees are here. we do believe that this market needs a jump start.

a very good morning and happy thursday. thank you for tuning into street signs. extending losses are accumulating. this follows a downbeat session on wall street although those losses compare and pale to losses in europe. we also saw steep losses in hong kong overnight. the basic materials and text that are are getting hit hardest. global sentiment has soured over the last 24 hours. investigator -- investors reacting to the fed minute yesterday. essentially this shows we should brace for higher rates. let's bullet -- break it down.

down 9/10 of a percent. a fairly sizable pullback across the board. perhaps investors are wrapping around the possibility that central banks may indeed actually follow through on the hawkishness that they have been signaling over the last several meetings as well as n centra, portugal last week. now for central perspective. every sector in europe is trading down. utilities is the most resilient of the bunch. that basket of socks down 2%. we do have a commercial real estate gassed -- aghast so we will talk about the trends on the commercial side of things.

those cyclical sectors are getting hit in an outsized way. asian trade, i mentioned the pullback. basic materials and technology are the hardest hit in the tang seng market. in mainland in china the shanghai composite pulled back by half a percent. a little bit more resilient but right across the board. what about u.s. futures? we are looking at a downbeat start to trade stateside as well. the tech heavy nasdaq and s&p also looking to extend losses. yesterday all three of the majors ended lower and interestingly we saw bonds and equities selloff in unison yesterday. we will talk a lot about the bond market. first let me detail what the

feds june minutes meeting showed. all policymakers believe that further tightening is likely. they paused the rate hike last month. according to projections released after the meeting, all but two of the 18 participants expected at least one hike would be appropriate and 12 expected two or more. following the minutes markets priced in an 85% probability of july hike but only a 30% chance of a second hike in november. on the data front we will get u.s. employment reports. new orders where u.s.-made goods increased less than expected in may. factory orders rose 0.3%. elsewhere, autosales picked up

in the second quarter raising nearly 17% year on year, while ev sales gained share as well. let's get to it. then immons joins us. thank you for waking up early for us. let me kick off with the minutes. they read fairly consistently with the statement we got in june. what new information did we get? >> good morning, juliana. there is a group of people in the fomc that did want to hike at this june meeting and that was a revelation i think, because when you saw the statement and headlines come out and it was unanimous to not hike in june but it they were

at least in favor of doing that. that tells you that there is a slope group of carcass manuals -- hart gish members that think we need us to flourish. that did show up on the top loss. i think the markets are taking this as if we are not cooling inflation then we may see even higher rates. >> have you adjusted your expectations for rates in light of this new insight? >> to some extent. the yield is the best indication of future policy.

we have made up most of the drop and it should be higher, because if the group of fomc members is right , we should be at at least five and half percent. that is reflect the of of a heart gish fed -- harkish fed. i don't think we will get to 5%. >> the rhetoric around the economic outlook was marginally optimistic relative to what we heard before. the fatty economists think it now -- the fed economist think

differently. somewhat optimistically. do you think the fed will achieve a soft landing? >> the fed is confident that they can. they hope there is a narrow path. they do sound confident. there is a good point about that section because the staff in the previous two minutes indicated they expected a mild recession. they have downgraded that to an even outcome. i think the fed not only wants this, but has confidence and that confidence is really important. i think that this explains why

we're having a rise in rates and people are filling like this is an economy that's resilient. that word showed up 11 times in the minute so i think it's an important word. >> when you look at how quickly and how high rates have risen it is pretty remarkable that the u.s. market, the financial market and the u.s. economy has held up well. is there a fundamental decoupling we are witnessing between interest rates and the real economy? is it just a moment of reckoning has not come yet? >> some of those, i think. it's interesting. interest rates did not have the impact we expected.

there is a work from home hybrid model. it was highlighted that it is impacting services more significantly and that leads to this higher, stickier inflation. we haven't had a recession because of the hybrid model we are still in. on the other hand there will be a point that rates are restricted more. i think it's more of a jump shoot that we are going through. the service economy will start to cool off.

>> then -- ben, what would give the hawks comfort that they can take their foot off the gas regarding rate hikes.? >> you will eventually see a negative presence. also in the sack there's -- in the sectors that i mentioned, i think that will start changing people's mind about we are getting closer than we thought we were. although they say they are a lot closer with policy, these

minutes again reflect that. >> ben, let's translate this to your portfolio. what are you doing with your portfolio here? >> well, i have had position of offense/defense. at some point the economy slides down to this recession scenario. because of the performance of the economy and high yield loans, the defaults of those sectors are low. you can maintain this position as well. there is still a risk on, risk off balance portfolio.

you'd do want to be aware. >> all right, ben, thank you. ben emons head of fixed income at new edge wealth. investors have possibly become too complacent. for more on that check out our premium service, cnbc pro. coming up on street signs, the gloves are off between the battle of mark zuckerberg and elon musk. we will tell you more after this break.

welcome back to street signs. profit of the world's largest chip maker, samsung, will plunge. operating profit will slide to a 14 year low. the south koreans firms chip

division will report losses. >> reporter: samsung electronics will release its second quarter earnings guidance on friday. future numbers are expect it to show deep pain in the industry. samsung's profit shows a decline of 96% on the year. that is the lowest for samsung for any quarter and over 14 years. it has to do with the fall in chip prices given typifying clients are still working through their inventory. with the full earnings rep for we will no more. profit guidance will kickoff the conversation at the tech

hardware sector. reports have suggested that samsung is channeling its focus on the high-bandwidth service and that nvidia is thinking of outsourcing to samsung. i'm sherry kane for cnbc hong kong. the export of metals is just a start as janet yellen visiting. she will arrive today. janet yellen is embarking on a four-day trip to china trying to connect the world's two biggest economies. >> reporter: treasury secretary janet yellen is to set down in

beijing after a tense week. china is flat x controls on key metals used in making chips. no major breakthroughs or deliverables are expected from the visit. at the very least this will be a chance to have out the differences. janet yellen recently offered what was seen as the most popular articulation of bidens china policy yet. this is being seen as a positive sign that the two sides can keep communication channels open at least at an economic level. janet yellen is also expect to

meet with the business community. there are also expectations that both sides will want clarity on definitions of national security and a better sense of how the economies are holding up. singapore, cnbc business news. in dealnews a company has priced it ipo at ,20 per share. the pricing implies a market cap point ,■ billion. the debut will be one of the first ipos journal -- and germany. romania will host europe's

biggest ipo event of the year. hidroelectrica has priced their shares under $23 giving it a market cap of over $10 billion. shares will start trading on july 12th. cab payments made its debut today. this has an evaluation of 850 million pounds. this email is confident -- this ceo is confident when asked why he is moving to another country. >> we will continue to dominate the global markets. from my perspective i look at it

and silicon valley is a great tech location but so is here. we have been around for a long time in london as i mentioned. the bulk of our employees are here. we do believe this market needs a jump start and we are hoping we can provide that. definitely, this is home for us. >> what role does the uk government have in attracting new technology companies? >> i think the uk government is doing a lot. we must be careful. we as company name -- companies need to ask for the right things so that they can provide other services. everyone can do better.

but the government is doing great jobs attracting the right kind of talent this market. >> threads is live and already proving a hit. meda ceo mark zuckerberg said more than 5 million people signed up to the social media plan form in four hours. he launched the trader challenge over the post. it allows up to 500 characters per post including videos, photos and links. no direct messaging function. we do have an indication on matters shares up 1.3% premarket. thankfully our orrespondent has done a little testing for us. i'm curious how this platform is similar to twitter. >> it pretty much looks identical to twitter. this is not the first time facebook or meda has cloned some other social media app to

see they have a competitive edge. it's just twitter without the rams and current discourse that happened on there right now. having joined just this morning it's very interesting to note that our own karen choi joined us now. clearly we are getting into some sort of battle. >> how do you get that many followers? >> be cut is linked to your instagram account it allows you to invite all the people all the people from instagram to this app. more than 1 billion users.

facebook has nearly 3 billion people on the platform. the numbers are staggering. it does have potential by the numbers. whether it can reach that, we will have to wait to see. >> at super interesting because you draw on your existing popularity on instagram because historically some people have major followings on twitter and measly followers on instagram and vice versa. i wonder if this will change who ultimately has influence on the platform? >> it will and you are right because take a look at my numbers. there's 114 thousand people that follow me which compares

to 14 in the half thousand people on instagram. the conversations will still be driven by the influences of that instagram space. before the launched that is what mark zuckerberg said. it's meant to be kept friendly.

>> do we know how they are planning to monetize the plot form? >> that is one of the key elements. twitter has lost some of its advertisers in particular and hopefully threads will take on the back of that. that is the one part that they are aiming to look into because if they are able to make more money from it then they definitely will stick around and invest more.

you can have a threads conversation with somebody else probably not on twitter but for example on twitter and you would have a conversation while the other person stays on their app. >> all right, happy threading. >> a new word. >> i will download it afterwards. coming up on street signs signs fall amid hybrid working.

cnbc. that live ambitiously. friday, 8:30 eastern. welcome back to street signs. i'm julianna tatelbaum and these are your headlights. wall street weakness goes into european trade. u.s. futures point two a negative open after the fed has more interest rate hikes to come.

>> i think it would be good for producers. >> can you imagine when and if economies improve? we are optimistic. >> we will hear from the opec sect attorney general this hour. and beijing is welcoming janet yellen but tensions simmer. the ceo tells cnbc the that london was always its first choice. >> this is a good location for us. we have been around for a long time. many of our employees are here. we do believe this market needs a jump start.

we are hoping this will provide that. let's get your check on market about an hour and a half into the trading session. most notably there is a spill over into europe. in terms of sect hers we are seeing heavy losses in the tribal and leisure -- travel and leisure section. overall this does appear to be a risk off section. you have iag shares down 3 1/2%. a fairly broad base pullback across the travel market.

euro holding steady versus the dollar. sterling doing almost nothing. a little bit of a holding pattern after yesterday's fed minutes dropped. investigators are coming to terms with the fact that we are dealing with higher prices. dow jones, 160 points. smp and nasdaq looking to extend losses after all three industries and the lower yesterday. now back in the uk we actually had a ton of action.

a huge amount of movement in the gilt curve. andrew bailey says he cannot give a date for when the bank will cut rates. the year on government debt reached its highest level and it continued concern over the country economy. that follows weeks of arising rates in the secondary market. 75 basis plus above current prediction for the banks terminal prediction rate. all of this while u.s. -- uk office lease lacks have fallen. in the first quarter of this year according to property

management platform, release, more than 12 percent of office buildings in the country are unused. andrew halla see joins me now. it is wonderful to have you on the program. >> good morning. >> this is a fascinating area for market participants. real estate has been seen as a major risk. let me just kick off with the fresh data we just brought to viewers. in the uk the number of long term leases more than 10 years has dropped 70% from 2019. it paints a pretty good -- grim picture. >> is a structural shift in

terms of how businesses want to occupy their space. since the pandemic there has been a large degree of uncertainty in terms of how much space corporations need. they have been rethinking how they have been using that space. large corporations want more flexibility because it's difficult for them to predict anything right now. >> we know that working trend very dramatically across cultures and markets so how did they go on forecasting what they need despite that vulnerability? >> i think the reality is over

the last few years have seen such a diversions of strategies from major corporations. i think the last 12 to 18 months the whole hybrid concept has established itself as something that will be stay. how much flexibility should we have? now it will change when the rating is done. is a complex environment. >> talk about hybrid working being here to stay. employers in many cases want employees to come back to the office. they think it's more productive. what's the most effective way to alert employees back? >> it's an interesting question and certainly employers do want

to see employees come back but not necessarily five days a week. the whole concept of hybrid is empowering the individual to work in the best structure for the type of work they are doing. i think the general guidance is there needs to be leadership from the top of the organization to define what our working policies will be. also how we will collaborate and foster a good relationship in the country. that does involve physically bringing people together but what we have seen is a major restructuring of how space has been used. we used to need lots of desks for people to work out. that is not normally the model anymore.

>> it all sounds great, but these companies that you are speaking about are also operating in an incredibly difficult time. it's hard to imagine them being able to offer those things when they are being pinched from all sides. >> there is a really strong business case for large companies to think their real estate tragedy -- strategy over again. companies require less office space but most of them do want to double down on experience as they do want people back and they want them to have really rich experiences and a fantastic experience when they are in the office. if you think of that impact if you can take 20 to 30% of your

real estate profit, it will be good for your bottom line. >> pre-pandemic the trend was for big campuses with thousands of employees and tons of different activities available. big headquarters and it sounds like that is gone. >> it's interesting. i think the days of large campus are not completely gone but it will be different. we still have huge companies that want to bring people together. they just won't be as much space. most of what we have seen of progressive companies that are taking action show it's been quite specific and quite surgical will.

this will still take a little bit of time to play out. but it's good that we have a clear strategy now. >> let me use the u.s. as an example. a city like san francisco has become a ghost town. a lot employees have left. they have gone to satellite cities around the u.s. portlan , austin, chicago. are companies considering building these smaller offices in these satellite cities or

are they still thinking about tier one cities as the primary place? >> still tier one so in effect for the last two years we have seen few decisions. employers want to make sure they are providing great places for their employees to be productive. we will likely see don't think any major changes that we will likely see more focus on existing space making it stronger and better. >> all right, thank you for the conversation.

falling commodity prices are fueling fears of an economic downturn. the overall smp commodities index has fell more than 12%. you can read a full story on our website, cnbc.comm. 's villa had on street signs. we hear an optimistic tone on oil demand.

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welcome back. saudi arabia's energy minister has defended the cuts to oil production saying the decision aimed to mitigate the cynical side of spectators and demonstrates the strength of their corporation. the prince said the alliance is repaired to do whatever is needed to's of the oil market. dan spoke to a ceo of ramco

about why prices have risen. >> the sentiment is not there. you can see what is the number for this year. $102 million. this is not a year where there is recessionary signs everywhere. jet fuel as you say still $1 million hello. can you imagine one thing pick -- when things pick up? >> the ceo told cnbc he is optimistic about demands.

>> everyone complains but i think we are doing good. okay, it's lower than last year.

5:00 a.m. and here is your five at five. we begin with what's happening, the treasury secretary in china as washington and beijing's trademark shows no sign of ending. stocks extending yesterday's losses as investors look to jobs data in the next two days and hours early already 10 million users meta platform launches threads, what some people are calling a twitter killer. plus the biden administration appealing a ruling barring it from minglg