it is 5:00 a.m. here at cnbc global headquarters and here is your "five@5." we begin with arbitrary and outdated swift reaction from capitol hill and the white house after fitch ratings takes the ax to the long-term credit rating of the u.s. government. to wall street, a question in the timing and the racitiona behind that move it's picking up steam all around the world. and race on the radar. the latest read on weekly mortgage applications is out today as mortgage rates soar back above 7%. we get a check of the housing

market that's coming up plus earnings showing no sips of slowing down we get much more ahead on the show. and later we're going to check the pulse of the consumer. we speak exclusively with the restaurant chain first watch and get his take it's wednesday, august 2nd, and you're watching "worldwide exchange" right here on cnbc ♪ good morning welcome to "worldwide exchange." i'm frank holland. let's get you ready to starture day. we're going to kick it off with a check of the u.s. stock futures. we saw the highest close since february of 2022 as we mentioned following the downgrading by fitch, we're seeing the future. the dow would open up more than 200 points lower the nasdaq and s&p 1% lower, the nasdaq down more than 1.25%. all have been losing steam

throughout the morning we're also checking the market on the heels of that downgrade first, s&p futures, we just showed you the chart we're going to move to the yields yeeds back above 10% a couple of basis points lower than yesterday as we always mention, inverted yield curve. we're going to talk more about bonds and yields later in the show we're also looking at energy markets. take a look. wti, still above 80 bucks a barrel, 82 bucks a barrel. moving slightly higher wall street brent crude about 85.5, almost up 0.75%. let's get to the developing story. fitch ratings downgrade the u.s. from aa a-plus to aa it's seeing fiscal deterioration over the next three years and continued 11th hour deals to raise the debt limit

this is after repeated attempts of the government to pay back its bills and debts. it warned of a possible downgrade before keeping it unchanged one month later. in response secretary treasury janet yell en calling it arbitrary and based on outdated data we're checking once again. seeing bit of a spike. 10-year yield back above 4%. in a post on x, the platform formerly known as twitter, it's called, strange, adding, he's puzzled by many aspects of the announcement and the timing and he feels he's likely not the only one a similar a take from goldman sachs saying the downgrade should havelittle direct impact on the financial markets as it's unlikely there are major holders of treasury securities who would be forced to sell based on the

ratings change it's the first cut since s&p lowered its ratings back in 2011 again, taking a look at futures right now, lower in the premarket. the dow is expected to open up at about 250 points lower. the s&p and nasdaq down more than 1%. all right. let's see how the global markets are digesting the downgrade this morning. we're going to send it over to julianna tatelbaum live in our newsroom julianna, good morning. >> frank, good morning despite what goldman sack and others have said, the direct financial impact of this downgrade should be limited, we are seeing sizeable selling across the globe let me take you to asia where equities moved lower in the overnight session and a pretty siza sizeable move. hang seng china holding up a little better but still dropping the nikkei 225, 3% lower

it corresponds to a rally in the yen. let me take you to the dollar/yen trade you've got demand for the yen rising overnight as investors seem to be fleeing for quality the save haven yen typically a chance for investors when there's a risk-off you have every major region in the continent is trading lower and the uk fitcy 100, down. clearly you see here 1.5% lower for the most part for every major region in terms of the bond market, the reaction has been a little more mixed. the 10-year trading at 2.94% you mentioned treasuries, frank. we'll just stake you to the japanese bond, the 10-year jdp trading at 0.4%.

in addition to suggesting the ratings downgrade from fitch, we heard from the bank of japan overnight pushing back against the view that the recent policy tweaks so pushing back against the expectations that we may be in for a further tightening from the bank of japan. a lot for investors to digest, but the overall tone i would use to describe overall markets, risk-off. >> our julianna tatelbaum, thank you very much. live from our newsroom. we'll take another check on futures. again, under pressure after the downgrading by fitch of the u.s. the dow jones down more than 200 points the s&p down just about 1% the nasdaq, the hardest hit at this hour, down more than 1% let's bring in annika gupta. good morning thank you for being here. >> good morning. >> i think we have to start with the downgrade of the the u.s. credit rating by fitch how do you see that impacting the markets today and then

longer term? >> i think in the near term, you know, fitch's downgrade was inevitable i think they've taken it in a different direction. the u.s.'s position is deteriorating. for example, we like to see u.s. debt levels -- they're expecting to rise from 98% to 115% by 2023 they are providing an important caution for the market but it's going to be on the strength of the u.s. economy relative to the rest of the world and that's what's going to be driving things i think for the long term it's something markets are going to keep, you know, on their radar, but for the short term, the focus really is going to be on the strength of the u.s. economy. >> right now we're looking at the charts of the nasdaq

futures. despite what the treasury secretary says, calling it arbitrary, we're seeing it impact today how do you see this all playing out when it comes to individual sectors? are there some sectors that may be more impacted than others >> i think the risk off mode that's pervading the market so far as we look at the sessions has largely been dominated by them that they want to reduce the participation of youth in video gaming, and i think that is sending a risk-off sentiment because they're cracking down on the base within china. i think that's one factor. secondly, we are in august, you know, trading is relatively thin, and i think that's also playing a factor on sentiment

overall. so i think it's less of a factor to do with what fitch is saying and more what sentiment is doing in china. >> okay. fair point you're also seeing more volatility coming from now until the next fed meeting, so this is just another fang tore, i would imagine, that would add to your thesis of volatility, even if you don't think it's a direct catalyst for the downside moves we're seeing today what areas of the market do you see having volatility between now and the next meeting >> so clearly the u.s. has been on an upward trajectory since we started the year, and i think there is -- you know, there is a chance of a correction near term so far earnings have been holding up pretty well we've seen a much stronger earnings beat from the u.s. relative to europe, but i think, you know, the biggest chance of an outlier or surprise that could catch the market off guard, you know, could result in

a bit of a pause in the upward trajectory that we've been seeing in u.s. aneeka gupta, thu we appreciate it. turning now to dc, former president donald trump has been indicted on his attempts to overturn the 2020 election the president is expected in court tomorrow nbc's drew petrimoulx joins me from washington. good morning. >> reporter: good morning, frank. these allegations are truly extraordinary. former president donald trump tried multiple strategies to remain president after an election he knew he had lost he's comparing u.s. to nazi germany, as he continues his push for return to presidency. former president donald trump indicted on four new charges for what prosecutors say were his

multi-pronged efforts to remain in the white house after losing the 2020 election. the former indictment accuses the president of taking part in three conspiracies, to obstruct official proceedings by stopping the recertification of votes on january 6th, 20201 and the third, broad conspiracy to disenfranchise voters. >> the attack on the u.s. capitol on january 6th, 2021, was an unprecedented assault on the seat of american democracy. >> reporter: this is jack smith's second indictment of trump. attorney general merrick garland appointed smith and said smith is acting independently. >> mr. smith and his team are experienced, principled, career agents and prosecutors and they've followed the facts and the law wherever they lead. >> reporter: but trump and his defenders say the prosecution is politically motivated. >> joe biden is running against donald trump and losing currently, and now we have that

justice department indicting president trump. >> reporter: trump taking to social media, writing, why didn't they bring this ridiculous case 2 1/2 years ago? they wanted it right in the middle of my campaign. that's why but former vice president mike pence had a different take he said, anybody who puts himself over the constitution should never be president of the united states, a sharp rebuke from a man who was once trump's running mate this is the third time trump has been indicted, twice by the special counsel and once by a d.a. in new york for payments to adult film actress stormy daniels and interference in georgia could come this month. frank? >> drew petrimoulx from dc thank you very much. a lot coming up including one word investors have to note today. but first much more on the impact of the downgrade and what impact it could have on the housing market. plus, how and is overcoming

weakness. >> and later, checking on the pulse of the consumer and the state of hiring with the ceo restaurant chain first watch a very busy hour still ahead when "worldwide exchange" returns. my dad started trek in a red barn in waterloo, wisconsin. and now it spans the globe. you wanna take what was given to you and you wanna build it. and you wanna pass it along. if i can do that, i would have done well. that's why we're here... to help make it happen. we've got your back, road warriors. because we know you're picking up the pace, steering life at 10 and 2. you're hitting the road... and we're helping you get there with confidence. so skip the counter without missing a beat.

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we get a fresh snap on the housing market they're out at 7:00 a.m. eastern. it comes as they're topping 7% that's causing issues for homeowners who want to move but can't because they're locked into a cheaper mortgage and now they're unable to found a new place that fits their budge. so many are choosing to stay put, adding to an already critical shortage of available listings on the market let's talk more about this with lead analyst as housing wire good to see you. i follow you on social media all the type you've been talking a lot about this good morning. >> good morning. yes, mortgage rates are simply too high to create more growth in the housing market right now, even though demand is no longer collapsing we're not seeing much growth at all with rates near 7%. >> i want to dig into some of the data you sent u. let's start off with new listings on single-family homes.

you compare this year to last year how should we read this trend? >> as soon as mortgage rates got to 6%, there's a certain group of home owners who simply will not move simply they can't afford to move active listings are negativee over year. you combine those two together york view a very tight supply and an affordability issue this is the main reason why they're at 0th century lows today. >> i want to ask about the u.s. downgrading from fitch does that impact the housing market either directly or indirectly >> as of right now, they haven't made any noticeable moves.

we'll see if the it gets any more stretched everyone knows we're going to have deficits every single year. how are we going to deal with the debt ceiling issue if one time we don't get that passed at some event in the future so as of right now, it's not a problem in the bond market, but time will tell when that issue arises it will be here every single time. >> i want to go back to some data it goes back to the broader housing market according to your data, inventory numbers, they spiked on the back end of 2022. is it possible with so much demand and mortgage rates above 7%. >> i don't see booming housing demand i see stable housing demand. but when you have stable housing demand and active listings at an all-time low, it doesn't allow inventory to grow. last year we had the biggest

crash ever and the slope last year was very fast this. year, not so much. that's the main reason why active listings are still negative year over year and new data has been trending at the lowest levels ever it's too expensive, so a lot of people are just sitting in. >> so it's really about affordability. >> i'm not a big mortgage rate lockdown there are going to be certain americans that got hit with the affordability crisis last year, and because of that, you see the new listing data come down think of it as this. supply's a fung of demand for housing, so naturally when there's a huge affordability hit, that supply not coming onto the market is a function of the demand being hit real estate than people saying i don't want to move because my mortgage rate is so low. >> logan mohtashami, thank you for the insight. coming up on "worldwide exchange," we have your big money moves and your morning mystery chart.

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market share gains to success with its online advertising include about collaborations with social media influencers. shares of elf up 18.5% right now. match sh shares also showing so love pointing to a growth in tinld der as a key factor in the strong quarter after rolling out price increases. shares of match group up 7.5%. and shares of solar looking dark below expectations citing slowing demand for its burners they say they expect revenue between $880 million and $990 million compared to the more than $1 billion as the industry grapples with lower electricity prices and higher borrowing costs. solaredge down almost 13%.

mcdonald's has called it a challenging macroeconomic environment. tort we're talking fast casual and restaurant chain first watch, the company pantsing a very rosy picture for consumer spending, traffic, and demand. the stock not doing too bad either on pace and beating rivals like chipotle and sweetgreen joining me now is the ceo of first watch, chris tomaso. thank you for being here. >> thank you. >> you serve, breakfast, brunch, lunch. are you seeing any new trends when it comes to your customers? >> nothing really new. we've had a long track record. this quarter was no different. we've got a very highly differentiated offing, 7:00 a.m. to 2:00 p.m. we're opening on growth a restaurant a week across the

record i think breakfast has been the only daypart that has seen growth over the last, you know, call it five or seven years and we're the leader in that space. >> chris, you say you're trying to open restaurants. i want to talk about two things that impact restaurants, inflation especially when it comes to commodity prices and the tight labor market how is it impacting your extension plans and current operations >> we saw some challenges last year in both arenas, but i have to say those have abated for us and we've been able to hire the teams we've been able to hire for our growth and existing operations and from a commodity standpoint we've seen a lot of easing as it relates to that last year was a tough year we're a big egg user, so eggs were a big influence. >> obviously brunch and breakfast a lot of omelets being

served, scrambled eggs many of your companies are saying they're pretty resilient. i've been to brunch a few times. the big thing about brunch is a seasonal menu or specialty drinks rchl you seeing customers spend more for that experience beyond the mool but the experience, buying maybe another mi mimosa are we seeing that kind of trend? >> great question. that's the first thing we look for to get a pulse on the consumer is there any check management going on we're not seeing that. when the consumer comes into the restaurant, they've been extremely resill yachblt they're looking on celebrate we're a multi-beverage occasion, coffee and a juice or coffee and a different drink and so we're not seeing any of that in fact, our beverage attachment has been up and ppa has been up. >> so i think the question is how much longer can this last?

i think people have been out, traveling, eating out. how long do you see this resilient consumer willing to spend more just to have a good time lasting >> honestly i think it depends on what's happening with the economy. we're starting to hear things about a soft landing hopefully that gets into the consumer psyche and their confidence goes up again, we've been extremely pleased with our perforexperiene during this difficult time. >> the labor market is not that tight right now, but what about wage inflation we're hearing this across a number of sectors. are you having to pay people more >> absolutely. we pay abosch minimum wage for all of our positions in our restaurants and so we've always been able to not have the same kind of pressure that others have had, and, honestly, our daytime only hours really helps attract the best and brightest in the industry. they get to have a quality of

life we've leveraged that during these hiring times. >> chris tomasso of first watch. i keep saying we need to have you in here and try a demo, try one of those omelets. >> thanks for having me. straight ahead on "worldwide exchange," bank of america lag out its bulk after a mix we're going to be right back after this break helping businesses both large and small, communities and the people who live and work there grow and thrive. we're proud to call these places home too. they're where we put down roots, and where together, we work to help move everyone's financial goals forward. pnc bank. ♪( please don't go by harry casey, richard raymond finch )♪ ( ♪ ♪ ) ♪ (please don't go) ♪

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it's right around 5:30 in the new york area and there's

still a lot. arbitrary and outdated the white house and capitol hill they push back on the fitch decision to downgrade the u.s. credit rating. futures falling on the back of that news after the dow closed at its highest level since february of 2020 we asked one market watcher to re-evaluate your position. >> and no a.i., no problem for amd as the company sees its stock pop in the premarket despite the significant sales slowdown it's wednesday, august 2nd, 2023, and you're watching "worldwide exchange" right here on cnbc. and welcome back to "worldwide exchange. i'm frank holland. we're going to kick the half hour off fitch rating downgrading the government's fed rate, the a a-plus with the stable outlook from the best rating of aaa. the agency cite as what it sees

as fiscal deterioration and continuing 11th hour deals to raise the debt limit fitch sees this as a repeated event that threatens the government's ability to pay its bills and service its debt the move comes after fitch warned back in may of a possible downgrade before keeping its rating unchanged one month later. in response treasury secretary janet yellen calls the move, quote, arbitrary and based on outdated data. many believe the immediate impact will remain muted t mohammed of x calls it strained and is puzzled by the ann announcement and the timing and he believes he's not the ontario one. a similar take with goldman sachs saying it should have limbal impact on the financial markets as there are those who would be forced to sell.

fitch let's move is the first cutting since 2011 for its part moody's continues to hold the u.s. at its highest rating i want to get a check on u.s. stock futures. right now the dow would open up more than 200 points lower but actually off of its lows of this session. we're also taking a look at s&p futures over the past hours. take a look here right here, significant drop-off as invests continue to digest this news. rye now the s&p down nearly 1% we're also looking at the bond market this morning. taking a look at yields, we start with the benchmark 10-year just over 4% we want to look at energy, particularly oil wti and the u.s. benchmark, just about 82 bucks a barrel, up almost 1%. brent crude up nearly 1% slightly lower than wti.

natural gas essentially flat. we're going to talk things over internationally u.s. follow ing others julianna tatelbaum live in our newsroom julianna, what do you see? >> frank, it's a very similar picture to what you're seeings with u.s. futures. risk-off you can see it was red across the board. the most plausible selling coming in the hong kong market with the hang seng dropping 2.5% by the time the session finished and the uk dropping 2.3% this fall in the japanese stockmarket came alongside a strengthening of the japanese yen, which is often a safe haven. so investors seem to be fleeing for quality. now trading around 142.63. it's a similar picture in europe much like you're seeing with u.s. futures, we have bounced off the lows clearly you can see beside me

the losses remain notable. the more defensive swiss market is showing the most resilience we've got the heaviest taking place in the uk. ftse 100 down 1.5% interestingly bond markets have been a little more muted in reaction to the fitch downgrade. you've got the 10-year trading around 2.9%. the uk gilt focused ahead of the bank meeting tomorrow. lastly, the jgb, japanese ten-year trading around 0.63%. this comes as the bank of japan overnight pushed back against interpreting its policy tweak as a signal that more policy tightening is to come c back to you. turning back to earnings, we're talking starbucks looking to extend its losses

it's same story sales is below expectations despite a rebound with sales increasing by 46% still starbucks is reaffirming its fiscal 2023 outlook projecting growth from 10% to 12% with the ceo saying he's not seeing downtrading in the customer base. for more on, this let's bring in the bank of america analyst. good morning. >> good morning. >> take a look at this report. it looks like starbucks is falling on north american same restaurant sales missing expectations does that change >> it was a little lighter than expectations i would say that's still a very solid same-store sales number. they did have positive traffic, and also we're seeing people continue to customize and add menu items like food

so there really is nothing underlying this trend that gives me pause or makes me caution the demand is still there in the u.s. and certainly as you said, we're seeing a nice recovery in china. maybe a bit slower than we had initially thought, but certainly consistent with the economic recovery there. >> we'll get to china in a minute is it close to the price target you saw or are you maintaining it >> we're maintaining it. >> starbucks has made investments when it comes to labor and productivity you see q4 as an inflection point for those investments. how should investors impact that and also margin, which is very important for the company? >> right that's why we're maintaining our buy rating and our price objective because we do think that, you know, now is the time we're going see the payoff on all the investments that starbucks made

so this is a company that invests roughly a billion dollars in its partners and employees in the u.s. and we're already seeing improvements in terms of throughputs we're seeing productivity improve so they have fewer labor hours but they're more productive hours we're going to see very meaningful margin expansion from here we already started to see that in the fiscal third quarter and we'll continue to see it in the quarters ahead as they leverage that through productivity on the very healthy top line numbers. >> does that trickle down to the bottom line if we see that margin expansion >> absolutely. so this is a company that's stacked about 10% to 12% revenue growth you u do need to see margin expansion to get to that 15%, to 20% growth we're at the high end of it next year and we think that's very achievable for them to be in

that that high teams growth going forward. >> we mentioned the number a short time ago 46% growth year over year. that's actually a covid calm when most of china was shut down how do you see long-term growth? i don't imagine 46% growth yoor over year is sustainable. >> no, that's right. to your point, we're laughing. very easy compare. we expect same-store sales to moderate they'll be mixed digits in the fourth quarter that's probably the right run rate going forward for starbucks. their target has been the same but 13% unit growth. we think again it's at least achievable, maybe conservative over time. when you think about the number of stores they have there, it's less than half the number of stores they have in the u.s. even though the chinese population is four times as big. the density is still lower there. we're seeing adoption of coffee.

chinese consumers sift to more of a writ youized morning daypart than afternoon tea time. >> tar bucks is down, 1.3% right now. your price, still 150 sara senatore, thanks for being here. >> thank you. sales falling almost 20% the most recent quarter. arjun kharpal joining me now hard to imagine sales falling that much and the stocks go popping. >> certainly, frank. look, a pretty lackluster quarter. revenue is down, the pc business is wark, data centers is weak. but there were two things. first the boring part. regions are stabilizing. they're expecting the glut to ease into the second half of the year the company forecasting double

digits, sequential growth in the third quarter for its client and data center business and margins were up. the exciting reason was ai the word on every company's lips at this point. amd is locking to challenge nvidia with an upcoming chip called the mi300 coming out if q4, ramping up production, testing it with customers we heard on the earnings quarter. this is graphics processing unit it's similar to what nvidia is putting out in the market. these are chips that are able to process huge amounts of data to train these big ai applications as well. there's a lot riding on this chip as well lisa su, the ceo, saying the company is expecting growth in the second half of the year versus the first half in regard to the data business thanks much in part to this brand-new chip that's hitting the markets as well investors clearly looking for

the next big a play this year given the massup run-up in nvidia. >> they're hoping it might be another a.i. play again amd shares moving up higher, almost 1% what is amd saying about china and opportunities there? >> well, the geopolitical risk from china hangsover all of the chip companies and one of the interesting things said on the call by lisa su, the ceo, they see a big opportunity for a.i. and they're considering at this point creating a specific a.i. chip for the chinese market and the reason for that is because of quite sweeping export controls that were brought in by the u.s. last year that would restrict some of these a.i. chips. what they would do is perhaps reduce some of the specs slightly in order for it to comply with the export controls. it ee something we've already seen nvidia do with its flagship

to comply with export restr restrictions it's something we're seeing intel do as well. >> arjun kharpal, live in london thank you very much. again, shares of amd up almost 1% later on cnbc, we have an exclusive interview with amd ceo lisa su. that's 9:00 hour on squaec on the street that's one you do not want to miss coming up on "worldwide exchange," we have your morning call sheet and why it was wrong. first as we head to break, some of your top trending stories apple's knicks big sports story could be college baseball. the pac-12 is moving three of its biggest schools out of conferences. usc, ku r ucla, and they're going to the big ten also colorado, coach deion sanders kind of becoming a buzz,

going to the big 12. california not in its aerospace. taylor swift says sales double or triple when she has her concerts there i have to catch up to that one, the eras tour. and krispy kreme has a doughnuts promotion. stay with us e fit. rosie used part of her refund to build an outdoor patio. clink! dr. marshall used part of his refund to give his practice a facelift. emily used part of her refund to buy... i run a wax museum. let innovation refunds help you get started on your erc tax refund. stop waiting. go to innovationrefunds.com you really got the brows.

welcome back to "worldwide exchange." on the back of very strong earnings and a recent revenue beat, there's a buy of a 25% price target now we're going to turn our attention back to one of the big earnings reports amd, citi upgrading the stock and boosting its price target. citi says the third lowest guidance was not as bad as expected time now for your morning briefing you look at the downgrading. among the countries still standing, germany, denmark,

netherlands, sweden, norway, and switzerland. analysts say they're not worried about a ratings downgrading contagion effect we're looking at asia. the bank of japan says it plans to maintain an easy policy stand the allow the benchmark ten-year yield. adding he does not have an exit for monetary easing in mind. there's an offering between 60 and $70 billion for its arm unit there's a change in valuation increasing from the original estimate of $30 billion now to $70 billion. coming up, we have one word every investor needs to know tech stocks trades as the regulator published new rules to prevent minors from spending too much time on smartphones

a blow to alibaba. same for tencent holdings. jd.com down 3.5% weibo almost down 57 if you missed us, check us out on spotify or heotr podcast apps w.e.x. back right after this (vo) verizon small business days are coming. from august 7th to the 13th. now is the time to partner with our experts. get started today with verizon business.

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to create new legacies, to transform a company, industry, economy, generation. because grit and vision working in lockstep puts you on the path to your full potential. old school grit. new world ideas. morgan stanley. exchange." ice time for your w.e.x. wrap-up. we're beginning with the top story. fitch downgrading the rating from aaa, citing what it calls expected fiscal deterioration due to feuds, credit tightening conditions, and a slightly slowdown in consumption. former president donald trump has been indicted over the 2020 election with three counts of him de-fraus the u.s., obstructing the electoral college vote and the right for

u.s. citizens to have their votes counted. meta changing access to all canadian users in response by a law in the country to pay news publishers. the automakers are to receive double-digit pay increases and define pension increases ahead of the contract negotiation. there is increased spending on test launches and membership fees as well as commercial space flights. and delinquencies of property loans decreasing 51 basis points in july it weighs in on the u.s. mortgage matrket. we have our reports out at 8:15, and it's another big day

with qualcomm and others and two can't-miss meetings later today. lisa su will be on "squawk on the street" and an interview at 9:00asm eastern and then jpmorgan chase's jamie dimon will weigh in on the economy, bank lending, and a whole host of other issues when he joins "power lunch" with leslie p picker. we're seeing the dow jones down the s&p down almost 1% but still off their lows this morning. and we're also paying close attention to the s&p futures over the last six hours. take a look at this. right now you're seeing a smart decline. s&p right now, the futures down just under 1% off of its lows. early this morning you're seeing the slight upturn in the last hour or so. we also want to take a look

at treasuries on o the back of fitch's downgrade from aaa to a a-plus the ten-eer benchmark at 0.02 off of the tide of yesterday we'll continue to watch the yeeds yesterday. let's talk more about this with brooke maine here in the house thank you for being here. >> thank you for having me. >> we oop've got to start with the top story. fitch downgrading. do you see it impacting the rest of this trading day, the rest of the trading week what's the long-temp impact? >> it's disappointing to see the downgrade. it's disappointing i get it thoechlt it went from 3.7% in 20202 to 6.3% in 2023. that's a significant increase.

debt ceiling negotiations sbieng gong into the 11th hour doesn't help we i don't think it will have a meaningful impact in the near term, but it's a warning shot to washington >> i think they get a lot of calls to your client when they call and if anyone want to adjust their partnpartnfoirng it sounds like you wouldn't want to advise them. what would you advise them >> we shifted toward growth earlier in the year to take advantage of the decline we saw in 2022, and it's paid off so at this point it would be prudent to take some risk off the table. also reallocate to companies with good cash flow that are more stable. >> what is your w.e.x. word of the day? >> my w.e.x. word of the day is

offside in celebration of the women's world cup, you know, offside is whenever the offense gets ahead of the defense and the ref throws up the flag a lot of tech companies have gotten ahead of themselves. >> very interesting. we're also looking for a move today is. there one move i don't know if it's change. is there a move, a stock, an etfing sector you would advise your investors to invest in today? >> we like boeing. they've done a great job using their free cash flow to pay down debt and demand is there demand is very strong. they had 460 net new orders for the second quarter and we think they'll be able to deliver on those as supply chain disruption'ses. >> it's been great to have you here one last check of futures before we let you go. futures have been under pressure taking a look right now, the dow down half a percent. looks like it would open 200 points lower off of its lows

the s&p 500 down 0.75% the nasdaq hard evidence hit at gngo th'soi tdo it for us you've got "squawk box" coming up next. thanks for watching. sleepovers just aren't what they used to be. a house full of screens? basically no hiccups? you guys have no idea how good you've got it. how old are you? like, 80? back in my day, it was scary stories and flashlights. we don't get scared. oh, really? mom can see your search history.

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\s 6am \ good morning fitch ratings agency downgrading the united states credit rating. we're going to to bring you reaction from the white house and wall street this morning. futures under pressure right now, but several catalysts on the planner, including a business slate of earnings and an edp private payroll report. plus, former president trump indicted over his efforts to reverse the 2020 election, charged with four crimes including conspiring to defraud the united states. we're going to have a live report from washington this morning. it is wednesday, august 2nd, 2023 "squawk box" begins right now. ♪

good morning,er. welcome to "squawk box" on cnbc. we're live from the market in times square joe is off today as andrew mentioned, summer is flying by. you're going to see some pretty significant decline. dow futures indicated off by 186 points, nasdaq off by 170, s&p down by 35 we'll talk more about this downgrade on the u.s. in just a moment, but yesterday the dow, believe it or not, actually finished in positive territory it was down yesterday through the morning and through much of the session. you can see by the end of the session it ended up by about 70 points, 71 points or so. believe it or not, that is 16 out of 17 sessions in a row that the dow has actually ended higher s&p and th