it is 5:00 a.m. at cnbc global headquarters. here is your top "five@5." apple iphone sales slump as the company gets set to do something for the first time in 20 years it is not a good thing stock is falling in the pre-market. a different picture from amazon that stock is surging after a blowout second quarter that tops every estimate on wall street. we have the highlights coming up. then, investors also bracing for the july jobs report and what a middle of the road number could mean for the fed's historic rate hiking cycle

plus, oil markets squeezed again as russia and saudi arabia send more shockwhataves throughe market and china throwing more stimulus at the private sector to boost the struggling economy in the recovery. it is friday, august 4th, 2023 you are watching "worldwide exchange" here on cnbc good morning welcome to the show. i'm dominic chu in for frank holland. let's kick things off with the u.s. stock futures after the s&p and nasdaq turned in a third straight day of losses, futures right now showing a brighter picture, at least for now. s&p implied higher by 15 points. dow jones industrial average implied higher by 55 nasdaq up 83 a tech recovery may be in the works. this is ahead of the july jobs report economists are expecting

employers to have added jobs at the slowest pace since december of 2020 at just 209,000 net new jobs for the month checking on the bond market. 10/2-year yields yields on each up 5.5% to 6% this week alone. the 10-year treasury is 4.91%. slightly lower the 2-year treasury is 4.92% which is slightly higher the 30-year treasury is 4.28%. in energy, oil is on pace for the sixth straight week of gains to the upside. wti up 38 cents to $81.92. that is a .50% gain. similar move for ice brent crude. $85.48 now to the top story and two of the most important stocks in

the market apple and amazon moving in opposite directions as you can see here this morning, after two very different quarterly reports, apple is down by 2%. amazon is up 8%. let's stick with the apple side of the story first the stock is under pressure in the pre-market after the third straight quarter of falling sales. the longest stretch since 2016 the management is warning the pressure could continue in the current quarter and if it falls one more time, that would be the longest revenue losing streak going back to 2001 apple is down 2% in the pre-market arjun kharpal is in london with the latest on the story. arjun, how much is just about the iphone side of the business? we thought the growth side was services and that seems pretty good >> absolutely, dom the market wasn't expecting blockbuster earnings given the 50% run-up in the stock.

they wanted apple to show stability. while eps and revenue were beats, but you mentioned the iphone number was in focus that is where the concern was. apple in the june quarter brought in $39.67 billion of revenue for apple. it was down 2% year on year. elsewhere, other hardware, mac and ipad, showing significant decline. uncertainty in the hardware space and consumer appetite as well the company has not given official guidance, but they expect revenue to fall again in september which raised more concern for investors. there are a couple of bright spots. the revenue up 8% in the june quarter year on year that is acceleration from the prior quarter. that is positive about the slowdown in services which has

become a massive business and it continues to show how apple continues to be able to eek out revenue from the 1 billion iphone users the other bright spot is china revenue up in it the region 8% as the overall market for smartphones declines there apple is doing well in the high-end of the market there and now iphone 15 launch is the neglnext expectation and if it can reinn v -- reinvigorate sales >> the overall role with tim cook and the growth going forward in india. can you tell us more with the trajectory in china and india for apple? >> china is something i'll deal with first, dom.

in the market, consumers in china have shown a willingness to pay more for phones the willingness to pay more for the phones was up 5% year on year that bodes well for apple. they sell in the high-end category as the broader smartphone market in china slows down one of the interesting things there is apple the was the only vendor in q2 in china to show growth it is holding up well there with the expensive iphone models. india is next here with the talk about tim cook's visit and apple opening physical store there is. the company saw record revenue in india in the june quarter as well separate data here q2 was in india with the largest market and secondly with the iphone sales in india

it is clearly huge and focus for apple in the coming years. dom. >> arjun kharpal in london thank you very much. shares of amazon are on the blowout for the quarter and return to double digit growth unlike apple the biggest growth beat since 2020 due to cost cuts and the largest amount of layoffs in the company history and citing confidence in the biggest ever amazon prime day they have had ceo andy jassy sounding upbeat on the outlook for aws, web services and cloud computing last night he said the revenue was stabilizing. let's bring in our analyst at cfra amazon topped the estimates on nearly every count this was, in many ways, unexpected how could they do it so well

>> dom, thanks for having me it was a standout quarter. i think all of the pieces are starting to fall into place for amazon on the ecommerce side, you saw improvement in profitability in advertising, you saw that grow at a 20% clip aws growth was 12% which was above the 10% estimate i think more importantly, amazon said aws is starting to stabilize. there is potential for acceleration for the second half of the year. all of the pieces are moving into place for amazon. >> amazon is critical to the overall market narrative, but also it performed really well. it is not anywhere near what some of the mega-cap peers have

done with the downfall last year is this enough to get us back toward what apple is seeing in terms of stock growth or microsoft or alphabet or other mega-cap tech names? meta in particular >> for amazon, the number one driver for the stock is aws business there was a lot of concern in the past few quarters that aws is decelerating and concern with investors that amazon is moving market shares for microsoft and google aws beat consensus this quarter and andy jassy said aws growth is beginning to stabilize sets up the stock well for the back half of the year especially with the opportunities in a.i. and machine learning and large language models. amazon is yet to monetize the products and services. i think that will with happen i4 the outlook is positive for aws. that is the number one driver for the stock.

>> is there any way we can extrapolate macro tailwinds for the rest of the cloud computing and business based on what we heard from amazon or is this execution specific for aws >> i think what you can conclude is the cloud computing cycle is beginning to trough if not already to trough. it seems the worst is behind them for amazon, customers are continuing to cut costs. enterprises are trying to save money. for aws to grow 12% year on year on the $88 billion business, that means amazon is bringing in a lot of customers and migrating more customers to the cloud. the tailwinds are outweighing the headwinds there. that will continue in the back half >> arun, thank you very much have a nice weekend. we have a lot more here to

come on "worldwide exchange," including the one word that investors have to know today first, a wild week for bonds as the selloff intensifies and what it could mean for u.s. stocks coming up next plus, more on apple's rough report and if another quarter of falling sales is changing the investment outlook for our next guest. and later on, getting set for the july jobs report we get insight from ziprecruiter veey know the jobs market. a ry busy hour when "worldwide exchange" returns after this commercial break now is the time to partner with our experts. get started today with verizon business. it's your business. it's your verizon. i'm so glad we did this. i'm so glad we did this. i'm so glad we did this. life is for living. let's partner for all of it. i'm so glad we did this.

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welcome back to "worldwide exchange." check out what is happening in bonds this week. yields on long-term treasury securities, 10/30-year in particular, with worries of inflation reemerge and that is ahead of the jobs report today which is expected. they are focusing on the u.s. fiscal outlook as underscored by the treasury plan to borrow $1 trillion this quarter and the fitch downgrade this quarter let's talk about this with matt malley bonds are something that we all are i mpacted by, i guess is the best way to put it with consumers and businesses

how significant is this move higher in yields and do you think it has legs? >> well, i guess the second part of the question does it have legs is less important than are yields remaining at these levels we saw the people this week saying yields could go a lot higher again, i don't know that really matters. we are back to the highs of the year and close to the highs that we saw late last year when the stock market was 20% lower i'm not saying this means the stock market will have to roll back over in a meaningful way, but it creates head wiwinds. valuations are a lousy timing tool we are almost 20 times the next 12 months earnings, that is harder to justify the valuation levels at the end of 2021, we were up

at these levels at 21 times earnings and yields were lower it is a concern for me in the stock market >> how much should we glean or put into the idea that rates rising the way they are right now is to a certain degree about the fiscal commentary about the country and also is this pricing in the idea that recession is now off the table? >> part of it. the other reasons you mentioned are important. one of the other things, too, and you mentioned it is the huge increase in the supply it is supply and demande it is funny because we have been buying all this stuff with treasury yields and now bonds and notes. this is a big impact this will have an important impact on the market

i guess my point is when we talk about recession being off the table, people need to be -- i'm getting complacent i'm sorry. what we have right now is a year ago at this time is when the yield curve got inverted it is usually a year later we see the impact of the inversion take place we are now starting to see issues with the consumer maybe seeing cracks there. i'm not so sure recession is off the table. >> before we let you go, let's bring it back to the equity markets as well. we talk to you about it often. is the stock market due for a pull back or do quewe keep this trend? >> it is difficult to keep this trend. that doesn't mean the market has to fall off the bed. the tech stocks have had a great run here, but getting expensive. because the tech stocks are more

expe expensive than the market doesn't mean it is okay. they are back to levels. i like to rotate to cheaper groups like energy stocks and health care. >> rotation is what matt is suggesting matt, thank you. >> thank you ahead on "worldwide exchange," the get out and travel trade is alive and well for now boosting this stock after a stellar earnings report. we'll have that mystery chart when we come back after this break. ♪ old school wisdom, with a passion for what's possible. that's what you get from the morgan stanley client experience. you get listening more than talking, and a personalized plan built on insights and innovative technology. you get grit, vision, and the creativity to guide you through a changing world. ♪

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well come back to "worldwid exchange." we have booking holdings soaring after the estimate beat by 30% and the record summer travel season despite higher flights and costs. the company which owns services like booking.com and priceline and open table says it saw revenue increase by 27% and is especially optimistic about the a.i. enabled travel assistance to help customer needs shares up 11% right now. shares of fortine. it is -- fortinet cut with the slowdown after pressure. those shares down 17%

pre-market draftkings stock rallying on the second quarter profit beat and increase to the full year sales with the confidence of the legalization of gambling across the united states. draftkings is up 13% oil prices are ticking higher today and on pace for the sixth straight week of gains anyone who pays at the pump knows this this is after the saudi arabia government is extending the output cut of 1 million barrels per day through september. russia will cut oil exports by 300,000 barrels per day next month. it is unlikely to cut the overall production cuts. oil prices up $80 for u.s. benchmark and international prices let's get to the chief bureau chieffor energy intelligence amina, this is one where we have

seen supply cuts weigh on markets before and pump up prices, but not to the extent we have over last few weeks why is this time different >> we're seeing a tighter market in general, dom, as you know with the inventory levels have been declining there is a lot of uncertainty in the market over growth and the fed hike its rates last month. there are questions about the economy with the mixed data coming from china as well with that is why russia and saudi arabia still needs to pursue the policy of caution and that's the main reason behind them deciding to extend the cuts by another month into september >> if you take a look overall at the way things are shaping up in the macro perspective, you see

rising interest rates in the u.s. which should be a negative for commodities and you talk about relative term on the currency market with the dollar which also should be a negative for oil prices then we have fears of recession which are receding is oil now telling us there is no recession coming for not just the u.s., but the world as well? >> that's a really good question i think we saw the opposite happen early in the year with opec cut and the price wasn't budging. it was staying at a similar level. the detachment we are seeing in the market with fundamentals and price are not really interlinked. that needs to happen in order for us to see the real impact of what is happening here are the voluntary cuts keeping prices up? absolutely they managed to speed up the

costs as well. still, i would say there are fears of recession and fears of a slowdown it is not translating to the price yet, but perhaps we will if opec stops the cuts and goes back to pumping at full speed or pumping at levels previouslyto the agreement where they have the 2 million barrels per day cut. perhaps we will see that impact on the price right now, it is masked by many things and mainly fundamentals and sentiment aren't aligned in the market >> all right amena bakr, thank you very much. have a nice weekend. as we head to break, a special announcement this morning and congratulations to our super advvi morning and congratulations to our super adving producer who w know well here and his wife on the newest addition to the family and "worldwide exchange"

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it's 5:28 a.m. eastern time in new york city there is still a lot of "with worldwide exchange" left here's what's on deck. stocks trying to bounce back after three straight days of losses investors looking ahead to the big july jobs report a very rough quarter for apple with the company now on the longest sales slide since 2016 the stock is moving lower ahead of the opening bell. a different picture for amazon a blowout quarter topping every estimate on nearly every metric there is the stock is surging on this friday, august 4th, 2023 you are watching "worldwide exchange" here on cnbc welcome back to "worldwide exchange." i'm dominic chu in for frank holland. let's get a look at the futures

ahead of the jobs report due out later this morning it is marginally green right now. dow jones industrial average implied higher by 65 points. s&p implied higher by 18 the nasdaq up by nearly 100 at this point we first have to check out what is driving that story. apple and amazon driving the stocks in the mix. one is painting, by the way, the picture of the struggling consumer the other is an example of operational excellence first off, apple reporting a third straight quarter of falling revenue and warning of more weakness to come as it deals with declining demand for consumer electronic devices of the services hit $21 billion those shares are up 1.5% we will have more on that story in a moment. there is amazon which is surging in the pre-market. you see they are up 9% after the second quarter results failed to passes estimates and guiding

sales growth in the coming quarter. this was the biggest earnings beat since the fourth quarter of 2020 ceo andy jassy showing the cost cutting efforts are starting to bear fruit apple and amazon moving in opposite directions. turning to the economy for the jobs report due out at 8:30 a.m. eastern time today. economists are expecting employers to add 200,000 net new jobs last month which would be the smallest monthly gain since december of 2020 the unemployment rate is expected to hold steady at 3.6%. now areas of interest this month include hourly earnings and number of hours worked joining me with the outlook and the fed interest rate hike cycle the is ziprecruiter economist julia pollack.

ju julia, this is scrutinized every month, but how important is this overall rate narrative that we are seeing after a pause and raise by the fed >> well, given how much mixed data is coming into the report is very important and the fed will want the wage growth continues to ease and the economy remaining resilient with job growth across most industries that is what people are hoping to see and the likely outcome with other data rolling in >> what exactly is the expectation that wie will continue to see and what some economists are calling the string of goldilocks reports with job growth still there, although modest compared to the last year or so, with maybe some slower jobs in terms of wage gains, i guess is the best way to put it, julia is there a scenario where this

can continue job growth with modest wage gains? >> this is very much a po possibility. this is where job opening fall and unp employment rate does not rise a little bit of heat is taken off the economy. businesses start finding it easier to hire and they can become more targeted and focus on quality again they are not under enormous pressure to raise wages or signing bonuses at workers >> one of the trends of the last year with regard to job growth is in hospitality and leisure. we saw some signs over the last couple months that is still maybe there, but not growing nearly as much can you extrapolate anything about the consumer based upon hospitality and leisure hiring >> very much going back to normal where the main engine of growth is healthcare

the government is also punching above its weight and recruiting workers after being blown out in the private sector for months. we are seeing public schools doing a better job of hiring they started last year with many unfilled vacancies and kids were pushed from one substitute to the next we are seeing that do better this year. a we are seeing job growth outside of leisure and hospitality >> before we let you go, julia, the question right now is we thought recession was coming over the last year and it hasn't arrived. do you think a recession is going to happen any time soon? >> the fed staff is no longer projecting recession bank of america has pulled the projection off the table

goldman sachs has downgraded the recession forecast there are many reasons to believe there are tailwinds to propel the economy forward like declining inflation and rising real wage growth boosting consumer confidence. the stock market rally could have the wealth effect and boosted ceo confidence in the outlook. >> ziprecruiter julia pollak feeling good about the economy thank you. turning to apple shares are sinking after the third consecutive quarter of revenue declines and hinted to a weaker fourth quarter. apple beat e arnings and revenu for the previous quarter, the focus is return to top-line growth by the end of the year. for a deeper dive into the quarter, i'm joined by dan morgan who is the portfolio manager at synovus trust

dan, apple is the most important stock for the u.s. market and maybe the global market. are you worried over what you heard last night >> dom, we knew coming into the report with qualcomm the beginning of the week with the smartphone chip business was down 24% obviously, we knew iphone revenue would come in on a negative light year over year. they where down 2-- they were down 2.5%. i was interested in the guidance they gave coming into the fourth quarter. they are expecting iphone revenue and services to accelerate in terms of growth. dom, you know as well as i do, we have the iphone p 115 that wl come out in september. it is hard to bet on apple before the release of the new

iphone i'm optimistic that they will close out the holiday season on a strong upbeat and get things back on track for them >> dan, this is interesting. you are a portfolio manager. i was on the "halftime report" yesterday with the investment committee. the thing that was brought up multiple times with the apple results is this is a company that trades 30 times next year's estimates. do you find that rich? >> dom, i knew you were going to ask me that with the multiples 30 times the around $6 a share. when we look the apple intnappls introduction of the iphone, the stock was trading 51 times

earnings if you compare the multiple post-iphone introduction, the multiple for apple is stretched. stock is up 44% for the year there's no doubt from that perspective it does seem a company that is a little bit of overreach. keep in mind, dom, we have apple on the buy list. we have a cost base of $1.29 per share. we will not get pushed out of the stock based on the valuation, but there's no doubt it is stretched. i would look at apple as an offensive and defensive stock. they are able to do well in multiple market scenarios. that is what is garnering that premium we are seeing right now. >> dan morgan at synovus thank you. >> thank you. coming up on the show, china

tries to prop up the struggling private sector economy investors appear to be on board with the move with the s&p having a strong july we will tell you where investors made more money and if that trade could actually continue. the full story when "worldwide exchange" returns after this break.

well come back to "worldwide exchange." time for the morning call sheet.

analysts upgrading wayfair from equal weight to overweight stephens says it looks prime to achieve 5% adjusted ebitda margins. wayfair stock up .50% in free market a an half dozen terms boost amazon the street highest estimate remains $190 a share from ever core's mark mehaney. and jim cramer favorite is restaurant brands with the oppenheimer report of the model and quick growth could mean the

restaurant could capture yum valuation. we like simplicity with fast food now for the global market briefing chinese property stocks surging after the people's bank of china offering more support for the economy. the central bank will expand private bond instruments as it looks to boost confidence with the china recovery and support real estate amid signs of slowing growth oil prices are on the move and russia and saudi arabia will continue to restrict supplies with the exports of 300,000 barrels per day. this is a number of cuts by saudi arabia with the recent cut in april expected to remain in place through december of next year in australia, the competition regulator blocking

the butteoyout of suncorp citine decrease in competition in home loans would have a major impacts on australians with the mortgage banks struggling to find borrowbo borrowers after the interest rate hikes over the last 12 months sticking with the global picture, we are in the middle of shifting sentiment with the etf with the markets having a banner month. seema mody is joining us now to break it all down. seema, this is an underperformer for some time. how can you tell whether or not this really is going to be the catalyst that drives the catch up in the emerging snarkts. >> -- markets? >> we know this is a question,

dom. hopes of beijing with stimulus measures has brought life back to the trade with chinese stocks rebounding over the last four to five weeks the etf out performing the s&p in july. chinese stocks are timed with the announcement on stimulus it won't kick in until the end of summer. they are waiting for measures to be announced like the relaxation of housing curbs evercore is abuyer of the pullback and expect opportunity to present itself in october they are sticking to the sidelines. those comments coincide with bank of america and merrill lynch which show funds on wall street are underweight with china and brazil and overweight on mexico. morgan stanley downgrading china, but upgrading india

across the country with the prospects. dom, wall street is not buying into the rebound yet, but a lot of investors say the fall could bring on opportunities with real stimulus announcements that would be moving. >> have we started to see, seema, any signs that investors getting in with regard to their wallets? do we see fund flows move a little bit more forcefully to the emerging markets with etfs >> fund flow data showing more moves into the emerging markets. it shows some investors are selective. even the chinese stocks are up, but we have seen outflows in the last couple weeks.

india inflows are moving as well as the jobs report, dom, with the global implications. that can weigh on investors. >> the currencies play a huge part in the trade. ayman mmohy seema mody, thank you. ahead on "worldwide exchange," one word you need to know, but if you don't succeed, try again. simon & schuster publishing house with the latest move that is coming up.

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for friday morning, that is the look around the world. time for the wex wrap-up. amazon surging on the biggest earnings beat since 2020 apple facing pressure after posting the third consecutive quarter of revenue declines and hinted it may be on track for a fourth kkr in talks to acquire simon & schuster watching shares for the truck maker n,nikola it will build out of the hydrogen network in north america. and uaw is asking for a 40% pay increase in the next labor contract from ford and stellantis. and redfin drops 21% after

the drop in the housing market. and block raises forecast despite the gross profit slowdown for july. here is what to watch today. the monthly jobs report with data on unemployment and hourly wages and payrolls as well as earnings from cinemark and fisker and spo and others. we are keeping an eye on the price of oil as opec kicks off the meeting to review the production policy. those things all in play today let's get a check on the markets on this final trading day of the week futures are pointing to gains for the time being ahead of the jobs report. right now, the dow jones industrial average is implied higher by 41 s&p by 14 and nasdaq by 81 with regard to where we stand in the markets with the volatility

and more near-term pullback, we are above the s&p 500 medium and longer term trend lines as represented by the 50-day and 200-day moving average if you look elsewhere within the market cap side of things, we know we have seen p outperformae in the s&p 500 the gap seems to be closing here it got wide from march through june or july whether or not the small caps can catch up is unknown. there are a handful of names in the s&p which doubled. nvidia and meta and tesla. the only other two s&p 500 companies which have seen at least a doubling of value?

cruise line operators. joining me now is stephanie link from hightower stephanie, this is the year of wait-and-see if mega cap can rebound. is that the market narrative that we care about right now or do we need to see this broaden out for the rest of the market to be in a good position >> yeah, i think there is a place in the portfolio for technology for sure. i do think that it would be healthier if the broadening we have been seeing the last couple weeks continues. i think it will, dom i think a lot of that has to do with the fact that the economy is hanging in better than most people expected which is leading to better than expected earnings and you see the broadening out i'm particularly encouraged today to see energy hold up

after yesterday because energy had a great day yesterday. we now have started to see manufacturing do better and industrials do better. especially if you look at onshoring names like ingersoll ram with the revenue growth. aerospace. look at ge and boeing. both raising free cash flow guidance manufacturing side of the economy is doing well. i think financials should pick up the slack as well as they had 19% earnings growth -- most of the banks did when they reported the second quarter earnings. the stocks are really cheap. i hope the broadening continues, dom. my portfolio is betting on that. i do still think there is a place in the portfolio for tech technology, clearly. >> stephanie, you laid out where the catch up trades with energy and financials and industrial complex. i love the names as well what is your assumption in terms

of macro for how these stock market gains and catch up trade can come to fruition do you expect recession? do you expect a softer landing scenario when do we see a pullback, stephanie? >> we can probably tread water, dom, in august and september we know these aren't great months ahead of us we had a nice run if i look at the economic data, particularly the jobs numbers, and we get a big one in a couple of hours -- if i look at the jobs data, it is hanging up well i mentioned manufacturing and the themes that are doing well there. pmi is bottoming when you look at gdp we did 2% gdp. 2.4% in the second quarter now the atlanta fed gdp is 3.9%. that number will come down no one is looking for

acceleration in gdp starting at the beginning of the year. i can see a 2% or 2.5% cut on gdp for the rest of the year that is healthy. that is good for earnings. if we wdo get the choppy sidewas action in august and september, look for opportunities one opportunity this morning is fortinet cybersecurity is on fire this stock missed and they lowered. a lot of it was due to ctough comparisons. stock down 17% there is the opportunity >> stephanie, before we let you go, your word of the day i need to know it. >> earnings. we just talked about earnings for companies. 70% of the s&p companies reported also with the non-farm payroll numbers, dom, with hourly earnings are top of mind the number can come in close to 4% down from 4.4% last month.

>> stephanie, thank you very much have a nice weekend. that does it for uhes re on "worldwide exchange. "squawk box" picks up market coverage coming up next. have a great weekend ♪♪ at 87 years old, we still see the world with the wonder of new eyes, helping you discover untapped possibilities and relentlessly working with you to make them real. old school grit. new world ideas. morgan stanley. so, you've got the power of xfinity at home. now take it outside with xfinity mobile. new world ideas. like speed? it's the fastest mobile service around. with the best price for two lines of unlimited. only $30 bucks a line per month. that's hundreds in savings a year when you wave bye to the other guys. no wonder xfinity mobile is one of the fastest growing

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good morning welcome to jobs friday we will bring you predictions and potential impact on the fed's next decision. that is straight ahead amazon shares jumping after the company reported blowout profits and guidance that is looking to accelerate revenue growth we will talk about aws and more. we have apple shares pulling back after the third straight quarter of falling sales one bright spot is growth and services it is friday, august 4th, 2023 "squawk box" begins right now.

good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick with steve l liesman. >> good morning. >> steve and i have been together for years >> mid '90s. you were 12, i think, at the time >> you were 14 >> i was older >> here we are we get to do the show together andrew will join us later. joe is off today a perfect day for steve here jobs friday coming up. ahead of the number, look at what is happening with the equities this hour dow futures indicated up 33 points s&p futures are up 12. the nasdaq is indicated up by 76 if you look at what is happening with the treasury market, this is where tng