for something they didn't do. [music playing] ♪ good morning. welcome to "street signs." i'm joumanna bercetche. >> and i'm julianna tatelbaum. these are your headlines. europe's stoxx 600 hits the lowest level in six months as soaring bond yields and conflict in the middle east sees investors flock to safety. the ten-year treasury yield briefly crosses the 5% mark. the highest level since 2007 as fed chairman jay powell dismisses suggestions that

current monetary policy is too tight. >> a few months of good data is only the beginning of what it will take to build confidence that we are moving to our goal. u.s. president biden calls on congress to pass a fresh security package for ukraine and israel worth $100 billion. saying america holds the world together. >> put all that at risk if we walk away from ukraine and turn our backs on israel. it's just not worth it. uk retail sales slide in september after they struggle with the consumer confidence. andrew bailey expects to see inflation pull back, but warns the tight labor market is a key concern.

warm welcome to "street si signs." let's get straight to markets. we have bounced off the lows and we saw 20 minutes ago where the stoxx 600 hit a seven-month low. several off 1% in the early hours of trade. we are 1% lower for the majority of boards. ftse 100 out performing and holding up being down 0.4%. this has been a global fee non man in. you we have the hang seng down .80%. similar in the shanghai composite in mainland china all of this after the weak session on wall street yesterday. let's see how u.s. futures are

looking now. we have got more red on the board. fairly muted in terms of the magnitude. the s&p looking to pull back 14 points. the dow jones industrial average down 67 points and nasdaq 67 points as well. a lot of the selling in europe and asia has followed the bond market yesterday stateside. joumanna. >> julianna, there was a lot of excitement in the market over the treasury yields. if you zoom in a bit, this blip yesterday, tells you the ten-year treasury note touched 5%. this was the first time since 2007. a big deal for markets as we continue to monitor u.s. yields rising across the board. these yields continue to move higher. it is note worthy with the risk off sentiment, we have rallied

back. through the course of the trading yesterday, the ten-year note moved up eight basis points higher. today, we rallied back seven basis points. it tells you into the weekend that some people are squaring off short positions in u.s. fixed income. all of this on the back of the jay powell speech. he struck a cautious tone at the economic club. he said they would proceed carefully. he stressed a few months of good data are only the start what have will be needed to bring inflation down to target. powell noted that rising bond yields are tightening financial conditions and geopolitical risk is highly el the stevated. powell had this to say on where the neutral rate may be.

>> we write down the estimates every quarter in the summary of economic projections . it is based on models and including looking out the window and the lag and current rates. the evidence is the economy he is handling much higher rates at least for now without difficulty. notionally, that might tell you the neutral rate has risen or we haven't had rates high enough for long enough. >> commenting on the range of risk, powell stressed pursuing the central bank's goal. >> we are showing resilience of economic growth and demand for labor. additional evidence of persistently above trend growth or tightness in the labor market is no longer easing could put further inflation at risk and war wranting tightness of polic.

doing too little could allow above target inflation to become entrenched and require monetary policy to bring more inflation at a high cost to employment. doing too much could do unnecessary harm to the economy. >> the reaction to powell's speech is what is known as a bear steepe nouning of the curv. we got to 5% on the ten-year note. this morning, we are rallying back seven basis points lower. 5% was the highest level we reached since july of 2007. the two-year note reached 5.259. of course, this morning, we have started to rally back again. note eably notably, as i mentioned, the

30-year tells you the curve continues to steepen as the market tries to mark in the end of the hike. it tells you the market is probably pricing out the further interest rate hike possibility for this year. pricing in rates higher for longer. that has been the reaction in the yield curve. as for equity markets, solid red across the board. the dow down .75%. 30,400 is where we are in the aggregate level. it is on pace for the fourth negative week. nasdaq is also one of the heavy performers. as for the week as a whole, a lot of red on the board. nasdaq is the under performer down 1.6%.

in terms of sectors, 10 of 11 sectors were negative week to d date. real estate and consumer discretion. not just yesterday, but also for the week as a whole. tesla with a heavy day of selling yesterday. ended down 9%. the real estate names which is no surprise given what we have seen with u.s. yields. as for today, the set up is not so pretty given the risk-off sentiment in european markets. finally, i want to draw your attention to the vix. the market gauge of volatility. we are sitting up at 21. this is the highest level seen since march. we have come off a little bit. it tells you as markets begin to get worried about the geopolitical environment as we head into the weekend, that will be factored into volatility market as well. >> let me welcome kevin to the

program at ubs asset management. kevin, great to have you back with us. you were here last year now to help us understand what is going on in markets. let's kickoff today with the fed given it was the focal point of trade yesterday. jay powell's speech. after hearing what the fed chair had to say, do you feel you have a strong sense of the reaction function? >> i would agree almost with everything he said yesterday. i think the fed should focus on delivering 2% inflation and a lot of talk about the moving target of 3%. i think if they move inflation target from 2% to 3%, the ten-year bond will go from 5% to 7%. >> wow. you agree with everything the fed chair said. he stopped short of outlining any specific the policy path from here. he did say does it feel like

policy is too tight right now? i would have to say no. what does that suggest what is coming next from the fed? >> i would say monetary policy is impacting policy through interest rates. interest rates are starting to get higher. i would say if the fed does nothing, keep it same for the next 12 months. >> do you approve of the st steepening of the yield curve yesterday? pricing in the fact that rates will the stay higher for longer? >> this is fashionable. two years ago, it was lower for longer. i think the market sentiment may need reflecting the risk path for the future. i think the two main forces which inflation is too high and central banks need to hike rate.

sec secondly, monetary policy is the reason for the yield curve steepening. the increase from 3.8% 12 months to september. it looks below 8%. it is still too high. i think we are coming down. >> can i pick up on what you were saying to julianna earlier? is it your view that ultimately what we are going to get out of this two years of tightening out of the fed is reevaluation of the neutral rate and because it will be higher, interest rate yields need to be higher. is that what you are saying? >> if inflation expectation is anchored low, then the real interest rate is required to control that inflation stability. it is lower.

you will see that in other countries. turkey is a big example. when inflation is out of control, the interest rate increase has to go higher. >> inflation is not out of control in the u.s. it is anchored. that's why i'm posing the question question. >> that's why i agree with the chairman. the fed's job should deliver on 2% inflation. look at it yesterday. the average core pce is 2.1%. the fed is 2%. only country with high inflation in the uk at 2.8% in the last 20 years. japan is below 2%. canada is below 2%. eurozone is below 2%. if you move from 2% to 3%, for every 100 basis points move in inflation, you require a higher

interest rate to control. that would be counter productive. >> let me ask you about bond markets. we got a stat yesterday that china had offloaded the most u.s. bonds and stocks in four years in august. we know, of course, china is a massive holder, second biggest holder of u.s. debt. do you think that trend is going to continue? the chinese authorities, clearly, are keen to defend the yuan and prop it i hup. do you think that will persist? what does that mean for travel for the u.s. bond yield? >> the chinese holding of the dollar hasn't changed much. there is a decrease in treasury and increase in holding of agency and agency mortgage and cash. essentially, over the last 10 or 15 years, they accumulated foreign assets which has been

diverted into the bond. the chinese foreign assets got up on the reserves at $3 trillion. it was too much. it was too much reserve on the interest rate. the sovereign wealth fund was making money. they are doing a good job. >> i think what we're seeing in treasury markets although the uk has a similar fiscal issue similar to the u.s., and their concerns are priced in with premium, but the difference with the uk and europe against the u.s. is the back drop is worse than in the u.s. does that make you want to own european bonds or the gilts over u.s. treasuries? >> i think the uk government for now is looking at the report of

asset management is forced to aw awaken. the bond is coming back. this is very important for asset pricing equities and fiscal policy and monetary policy. no longer is it a free ride. the government had to becareful in terms of the future. you saw that last september. you saw that in treasury. a few months ago, most people expected the u.s. government deficit would keep going down. 3.9% last year. it is going up with growth. that is quite alarming. >> we will talk more about the latest uk data later. kevin, we will have to say good-bye for now. kevin zhao at ubs asset management. don't miss steve liesman's interview with raphael bostic coming up at 13:30 cet.

>> if you want to get involved with the conversation over powell's speech, follow us on x or tweet us. we are @cnbcjulianna and i am @cnbcjou. and we will take a closer look at the market action after the break. that's coming up on "street signs." you deserve better than that. i'm hungry, i'm in a hurry, i don't have time to make anything healthy. you could if you had a blendjet. blendjet? it's the portable blender that makes the healthy choice the most convenient choice. i don't know. it seems like a hassle. hahaha! wrong. just pour in some milk, add some frozen fruit, and bam! you've got a nutritious and delicious smoothie. mmm! that is good. you're welcome, sad office guy. get yours today at blendjet.com are we in in an ad? we sure are.

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welcome back to the program, everybody. after hitting a seven-month low, the stoxx 600 has bounced. we are more than 1% lower at the start of trade today with cyclical sectors hit hardest. basic resources out in front of the lost leaders in europe this morning. it follows the selloff in asia overnight and the downbeat session for wall street yesterday as the steepening in the yield curve and selloff of bonds putting pressure on stock markets across the globe. let's see what is happening

across the region. broad based pull bback. ftse 100 down .20%. you have the dax down nearly 1%. the cac 40 down .90%. at one stage, all regions were off 1% this morning. you see the momentum has stalled. that selling pressure we have seen over the last 24 hours as stalled. we are seeing a bit of relief come in. from the sector perspective, here is the split. basic resources is the leader to the downside. 2% of losses. travel taking a decent hit down 1.5%. industrials down 1.2% lower. financial services down 1%. cyclical parts of the market are hit hardest with the exception of oil and gas which is flat on the day. you have a little bit of the green p onwith healthcare.

we did get data this morning i want to highlight. german producer prices posted the biggest year on year decline for september for 17.7%. this was the biggest drop since data collection began in 1949. over to the carmakers. registrations in the eu grew 9.2% in september marking a 14th straight month of growth. they both saw double digit gains. the electric vehicle market share continues to grow 14.8% compared to 14.1% a year ago. now over to makeup. l'oreal up 11% this morning, but missed expectations for a rebound in china. >> a down trade for the stock today. charlotte is joining us with

more. >> that is the surprise in the results we saw that in asia did much worse than expected. sales down 5%. europe and north america were resilient. asia down 5%. a lot of it is down to travel retail impacted there. people buying luxury products and a discount in china. expect a crackdown on that. l'oreal is not saying the sales are out performing the market in china and almost 8% in nine months there. the recovery is slower than expected in that region. resilience in north america is a bit of a concern with the resilience can help offset china in q4 and into next year. certainly, it is working. we see the results which are interesting with the luxury division which has been worse than expected. sales up%.

the consumer products are helping the weakness. luxury products up 13.4%. maybe people are switching to the expensive brands over the cheaper ones. maybe the lipstick effect is still there, but more affordable ones. the metalurgical beauty is up 28%. and finally an update on the acquisition that they completed at the ipend of august. sales up 17% in september. they are integrating it into the group. they want to push into china. they have four shops there. that is a target. l'oreal with six years of china proxy and overall market in the

red. results here are resilience. >> one of the strong points is the diversification across lines of luxury. charlotte, thank you. speaking of retail sales, julianna will get us up to speed on what is going on with the uk retail sales. a sharper than expected 0.9% in september. the decline was due to recent warm weather reducing sales of autumn clothing alongside continued cost of living pressures. bank of england governor andrew bailey struck an optimistic tone on the recent uk inflation data saying the slowdown in the consumer price pressure through september was quote quite encouraging. bailey told the "belfast telegraph" that the figures last month showed core inflation cooling to 1% was not far off the central bank forecast. hopeful about the uk trend, bailey noted wage growth in

britain is still too high. you and i were doing our marathon four-hour session came in when the numbers came through and the instant reaction was a bit disappointing. this month's inflation figure came in in line with last month. this is something i said at the time that the bigger beat was what happened the month before. we had the huge drop. the downward surprise. it is interesting to hear bank of england governor bailey remark that and say we will to see a drop because of base effe effect. it is not as huge as the prior month. >> not necessarily linear decline with the direction of travel being important. i was thinking about bailey's comments and context of what is happening politically in the uk. rishi sunak, when he came to power and started tenure as

prime minister, he made it clear that inflation was the focus. we woke up to the tories have lost two strongholds in elections in england to the labour party. rishi sunak is under pressure. his party is under pressure after all of the debacle with hs2. this has to be music to rishi sunak's news to say bailey is confident inflation is coming down. >> the inflation print wasn't welcome for him, but we have a couple months left. many think we will end up at 5%. we have a host of other issues they he areare dealing with rig. the signs of the economy with consumer confidence come in low. retail sales disappoint. all of this is a sign that the growth profile for the british economy is not constructive right now. that has to be a worry and one

of the reasons why, you know, we will start hearing more cautious words from politicians and bank of england. moving on and talking about another country we have been following closely. italy. s&p global is set to announce the review of the sovereign debt rating later today. kicking off a round of autumn reviews from the ratings industry. dbrs and fitch will follow moody's with any downgrade or network downward revision to bring the bund spread higher. the economy minister warned the downgrade could not be ruled out last week. julianna, we are sitting above 200 basis points with the bund because of the concern with the information italy published. this also tends to be cyclical. you see the spread widening out.

sylvia and myself spoke to the ecb central bankers at mar marrakech. we posed the same question to every single one of them. how concerned are you of the spread and all said not yet. we're not worried enough yet. >> i wonder what level would concern them. >> the market will test them. we will take a quick break when we look at what is going on in bond markets. coming up, president biden is reportedly asking congress for an extra $100 billion in funding for ukraine and israel. we'll discuss that next. blendjets halloween sale is back from the dead. take advantage of spine chilling savings. blendjet 2 gives you monstrous power for a delicious smoothie, shake, or frappé anytime, anywhere. cleaning blendjet 2 is scary easy. just blend water with a drop of soap. recharge quickly

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welcome back to "street signs." i'm julianna tatelbaum. >> and i'm joumanna bercetche. these are your headlines. europe's stoxx 600 hits the lowest level in six months as soaring bond yields and conflict in the middle east see investors flock to safety. the ten-year treasury yield briefly crosses the 5% mark. highest level since 2007 as jay

powell dismisses the current monetary policy is too tight. >> inflation is still too high. a few months of good data are only the beginning of what it will take to build confidence that inflation is moving down toward our goal. u.s. president joe biden calls on congress to pass a fresh security package for ukraine and israel worth $100 billion saying american leadership holds the world together. and the crisis of confidence with the bank of england governor andrew bailey expecting to see inflation to pull back, but warns the tight labor market is a key concern. hamas and putin represent different threats, but they share this in common.

they want to adestroy the natio. that's why i'll send to congress an urgent budget request to fund the national security needs to support our critical partners including israel and ukraine. it is a smart investment that will pay dividends for america for screengenerations. >> that was president biden giving a rare address from the oval office. he would send an urgent funding request to congress today worth more than $100 billion, including $60 billion for ukraine and $14 billion for israel. dan joins us now with more on the developments around what is happening in israel. dan, give us more detail about what this aid is going to be used for that biden has just announced yesterday. >> this was critical and it is great to see you both. president biden here clearly making the case in primetime for more assistance to israel and to

ukraine. he believes, if you listen to what he is saying, that basically there's a risk here for the united states and its national security. he wants more funding for the wars because they are unfolding on his watch just months out from the u.s. elections. this is going to be important to watch exactly what that aid looks like. it remains to be seen. a lot is what congress can achieve. it play into the heart of the american psyche. this is something impacting him politically. let's talk about what is happening on the ground in israel. we have heard from jordan's foreign minister who has been talking about the situation there in the interview with nbc news saying the risk of escalation is real. listen in. >> we've got to be careful. this is serious. if this war expands and we face a new war, then you are talking about a miserable situation for

all of us. the implications will resonate beyond any battleground now. it will get everywhere in the region and we'll have severe consequences for the world. >> this was a really wide ranging interview. one of the interesting angle tthe -- -- the angles he discussed is the deadly explosion that took place. the foreign minister saying there is really a lack of understanding still about who is behind this. of course, u.s. intelligence suggests it was not an israeli strike, but palestinians on the ground do not believe that. they believe it was israel at the heart of what has happened on the ground. confusion as well. a lack of clarity. this, of course, prompting protests in the middle east. you know, joumanna, it is unprecedented in this part of the world. it is the holy day today on the

ground in the middle east as well for many muslims. they are taking to the streets in anger over exactly what happened to the hospital. >> earlier this week, with tanya, we conducted an innterviw with the spokesperson for the u.n. aid agency. this was a few days ago saying that the situation was critical. there was a dire need to get fuel, water and food to run p hospital into the gaza stricp. what do we know what has happened to allow for the humanitarian aid to enter into gaza? >> the rafah crossing has been now opened and it has been reported 20 trucks have moved through to inqcarry food, waterd medicine. fuel is not included in the aid packages. that is also a concern on the ground that hamas might actually steal this aid and use it for its own resources as it fights

against israel. getting the aid to the right place is a key concern at the moment for arab leaders and western leaders as well with. the bigger questions remain of what is included in the aid and where it is coming from. details is still light. >> dan, it is great to have knew the studio. wonderful to have you here to talk about these things. the british prime minister rishi sunak agreed to supply food, water and medicines to civilians in gaza. this as sunak continues the tour of the region. he will travel to egypt today as well. this is after he met with the saudi crown prince and the para gr -- pair agreed to work together. let's bring in the international fellow from chatham house.

good morning. let's pick up with the biden visit to israel and speech yesterday out of the oval office professing steadfast support for israel. very welcome by the israeli government. to what extent is this going to change the calculus of how the situation pans out in the coming days? >> i think it is extremely important alongside the ironclad support that president biden is giving to give the floor to the arab regional actors. tomorrow, president el-sisi is convening a summit in egypt aimed at deescalation as you mentioned. i think whereas the u.s. has a leading role and the most leverage on israel, it is

crucial at this time to involve the reegional arab actors. president el-sisi invited the leaders of iraq and qatar and alongside jordan european nations as well. many have confirmed. cyprus and greece have confirmed participation. of course, u.s. secretary-general gutierrez will be there. it is an international summit held tomorrow, the 21st of october, in egypt aimed at not only deescalation, but trying to see how the conflict. president el-sisi announced it is about finding a way to relaunch the israeli-palestinian peace process. work out what the end game of this is going to be and try to

limit the conflict as much as possible. >> one thing i'm watching is there has always been pockets of anti-american sentiment within the middle east. what is happening now is it really feels like it flared up significantly in the last couple days. you see the demonstrators in lebanon and around the u.s. embassy. demonstrators attacking u.s. buildings and american university of beirut shouting anti-american slogans. do you worry about the effects of what this anti-american sentiment means for the region and what it means ultimately for a sustainable peace in the long run? >> i worry which is why i stress the importance of getting regional actors involved as soon as possible. i think it is not just anti-is

and jewish. we have seen the rise of anti-semitic causes in the last 14 days. it is vital for the u.s. to work together with the arab states and listen to them because they're the ones in the region who understand the dynamics. i'm not suggesting for a moment the u.s. doesn't understand the dynamics, but there needs to be conditionality to the military aid given to israel. i fear an escalation, once there will be a ground invasion, an escalation of losses to israel and civilians in gaza. it is impossible to fight surgically in gaza. it is a heavily populated area. it is not feasible to fight without having collateral damage. it is feasible to try to aim to do it as israeli states, but we

are likely to see a serious escalation in civilian loss of life. >> naomi, one story that stood out to me looking at the latest developments in the middle east is the pentagon is saying it is seeing an increase in drone attacks on u.s. military bases in iraq and syria. is it inevitable the u.s. is drawn further into the conflict when it is being targeted and as a follow-up to joumanna's point, not just on the ground, but from the military perspective? >> it is looking that way at the moment. it is looking like we are heading to a serious and rapid and dangerous escalation. that is why i stress again the importance of tomorrow's summit in egypt. tune in to what with the arab local leaders have to say. they know their audience. it is vital for the u.s. to work with the local leaders in order to prevent the escalation of the conflict which will undoubtedly

hurt, as you say, americans as well as other nations. >> when it comes to europe, you know, in comparison to the conflict in ukraine, where leaders have exhibited a strong degree of solidarity, it feels the risk of fragmentation among european countries is much greater given the varied histories of european countries with israel. it goes without saying, of course. how do you think about the support from europe moving forward for what is happening in israel? >> i think it will depend to a large extent on what happens in gaza in terms of the fighting. if children and women and men, too, civilians, are going to be starved and not enough aid and if we see disease and if we see bombings of civilians unintentionally, but there are

likely to be casualties in large numbers -- i think there will be fragmentation. at the moment, there is unity given the horrors and slaughter we saw two weeks ago on the 7th of october. we are still getting details of the degree of the nature and scope which is unimaginable. every day, there is more information coming out of children and babies and children tied together and burned alive. there's just horrific naked women, a number of them tied with metal strings before being burned. it is really horrific what is coming out. i think that has united the western world, for lack of a better term, u.s. and european states. everyone is standing with israel

and with the conclusion that hamas needs to be stopped and stopped so they will never been able to carry out such actions. however, if there will be collateral damage in gaza, this will escalate very rapidly. we have already seen the escalation. we also saw cruise missiles from houthis in yemen toward israel. yesterday evening. we can see in lebanon with the war with hezbollah is escalating. everyone it is escalating. the arab street is escalating. my hope is tomorrow where the more countries attend the summit, the better, because we need unity to work out and also how to fight all of the fake news. there is so much fake news and there has to be a consensus on how to fight that because many people have already formed their minds about what's going on and

they are not listening to the truth. with new technologies, we are fighting various wars on various fronts. this is an important one for everyone to fight together. >> naomi, i want to ask in response to the gruesome attacks on october 7th, the international court will say israel has a right to self defense, but in response, there are some world leaders beginning to say the retaliation out of israel is disproportionate. we are getting into legal territory here. is there any sentiment within israel that the retaliation, perhaps, has gone too far? >> um, there are groups in israel who are against the ground envision and siege in gaza. they are not the majority, but they are out there. one of the hostages has aired --

not hostages, i take that back. one of the survivors from the kibbutz on the border who hid and managed to survive the horror has aired her views loudly and clearly that the war will not get her family and her kibbutz members back and calling for an immediate halt to this. there are voices that understand that once you get into a war, it is not very clear how you get out of it. however, with regards to your question about proportionality. it is a legal term. israelis are working very, very hard to try to persuade the world they are acting within international humanitarian law and international laws of war.

however, it is not so easy to see how that is happening with the siege on gaza and ongoing bombardments. it's not going to be easy. the legal battle will go on with israel's lawyers working hard to try to persuade the world what they are doing is within the rules of warfare. however, as you know, law is interpreted in different ways and you will have lawyers arguing fierce fully on both sides. rishi sunak is conferenced -- convinced israel will act within international law. he had a conversation with the president. i'm sure that is the intention of israel. my doubts come if this is

implemented and possible to work within the realms of international humanitarian law and it doesn't look that way. >> thank you so much for sharing your views. it is fantastic to hear from you. thank you. naomi bar-yaccoc at chatham house. still ahead on "street signs," ukraine and the middle east is set to be the topic of discussions at the u.s.-eu wl it today. weilbreak that down next. crazy.e has no idea she's sitting on ae goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

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republican jim jordan is facing a third vote today in the bid to become u.s. house speaker. jordan is unlikely to prevail seeing opposition expand in the previous two rounds. patrick mchenry is threatening to resign if he is pushed legislation without expanding his powers. he doesn't want to set a precedent. and ursula von der leyen

will meet president biden today in d.c. to discuss israel and ukraine and potentially putting trade issues on the back burner. sylvia, wonderful to have you here at the desk. in addition to the situation in the middle east, one of the other topics they were set to talk about were the steel and aluminum tariffs. in the absence of the deal, tariffs will be imposed. >> there is pressure to come up with agreement. they have been negotiating some global agreement to counter chinese over capacity on steel. let's see how that will unfold. we could get a political agreement today, but details of the final deal are very unlikely according to two european officials. having said that, other topics they are likely to discuss, obviously, is support for ukraine which was meant to be the biggest topic of discussion today, but, of course, since the meeting was scheduled, we have

the latest war with hamas and israel. it will be important to see what people will say on that. we know here in europe, things have been heated with european support. division with the member states and in terms of who says what and who should go and visit israel authorities and so on. plenty of pressure on the european side. this will have an impact next week. already keep independ mind the european summit next week. >> i want to talk about the conflict in israel and solidarity with the european leaders. for the ukraine issue, europe leaders are united. when it comes to israel, what is the status? >> it is expected to take a side

with the russian invasion of ukraine. it is an easy conflict for the europeans to deal with although you see divergence with hungary prime minister meeting with putin. the conflict and war with hamas and israel is more complex and more sensitivities there. here is where the european history is important. one criticisms that the president of the european commission received is she was too quick to go to israel and sounded too supportive of israel. you have to keep indepe mind, f the german perspective, this is a delicate issue. this is a big issue they face on the geopolitical front. how united can they be with the complexity of the war? >> sylvia, i'm sure you will keep us up to speed. sylvia reporting for us on the eu and u.s. summit. let's turn to european markets. it is the down day. all of the majors are trading in

the red. we have the dax down 1%. some of the industrial names are trading at the bottom there. cac 40 is down .80%. we have been keeping a close eye on luxury. ftse 100 out performing, but down .30%. weak retail sales and consumer confidence numbers disappointing. as for wall street, u.s. futures are negative, but not quite so low as we were at the start of the program and start of the morning. we bounced off the lows of the morning. that is it for "street signs." m joinusor joining ing . i'julianna tatelbaum. >> i'm joumanna bercetche. "worldwide exchange" is coming up next.

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it is 5:00 a.m. here at cnbc global headquarters. here is the "five@5." stocks flat ahead of the open. the ten-year yield cracks the 5% briefly. all this comes after jay powell said they will remain attentive with the future rate hikes. stopping short of satisfying the doves and hawks. and president biden makes the case for ongoing support for ukraine and israel calling it vital for u.s.