it is 5:00 a.m. here at cnbc global headquarters. here is the "five@5." we start off going for four. stocks looking to extend the best three-day gains since march as futures search for direction. and global markets digesting the latest rate decision from the fed and the policy moves. we hear from the bank of england today. also today, it's a big one. apple set to report after the market closes today. we have the number one thing that investors need to watch coming up. plus, jeffery and stanley

sounding the alarm over a major market risk two years in the making. later in the show, no ad spending slowdown when it comes to roku as shares takeoff ahead of the open. it is thursday, november 2nd, 2023. you are watching "worldwide exchange" here on cnbc. good morning. welcome to "worldwide exchange." i'm frank holland. before we get things started, shoutout to the texas rangers winning the world series and gave five against the arizona diamondbacks. they won 5-0. congratulations to them. i wish my phillies won it, but congratulations to them. time to kickoff the hour with the stock futures looking to build on the largest three-day percentage gain since march. futures right now are in the green. it looks like the dow would open up 90 points higher.

nasdaq also up .50%. investors are continuing to digest the policy decision from the federal reserve keeping rates unchanged, but at a 20-year high. powell looking to be more restrictive in the months ahead. >> we're not confident that we reached a stance. we are not confident that we haven't, but we're not confident we have. that is the way will be going into the future meetings which is to be determining the extent of an additional further policy tightening that may be appropriate to return to 2%. >> the central bank commitment to tightening not stopping jeffery dunlach. >> rates will stay high for longer which is not my base case. if the economy rolls over, as i expect, the fed will not cut rates 50 basis points.

they will cut 200. >> a bold call with the fed cut of 200 points. we start off with the ten-year yield decline from yesterday at 4.72. the two-year bond is below 5%. now we look at the energy market and that is trading at 8$81.60 barrel for wti. brent is $90 a barrel. and nat gas is 1%. we have a busy thursday shaping up with silvana henao with the headlines. >> good morning, frank. shares of clorox cleaning up this morning despite cutting outlook following the august hack attack. the company posting fiscal first quarter revenue of $1.4 billion

which is topping estimate, but far lower than the $1.7 billion from a year ago. shares up 10% in the pre-market. a dark cloud over solaredge. shares sinking head of the open after missing top and bottom line for the third quarter. the company issuing a dismal outlook for the current quarter falling short of estimates by 50%. the ceo says the third quarter disappointment is a reflection of the slow market environment which has resulted in high inventory and in particular in europe. shares down 17% in the pre-market. no ad spending slowdown here. shares of roku up 19% after a solid third quarter revenue beat with sales jumping 20% from a year ago. active accounts at 76 million.

the third quarter sales surge is tied to strong performance and content and advertising and sales of the roku-branded tvs, frank. thank you, silvana. and the fed is finally done raising rates, but still some investors are remaining cautious on the economy and potential for a recession. we have jeff gundlach who expects a bond and stock market rally to go hand-in-hand with the economic downturn in 2024. >> i believe deeply that when with the recession comes, you will see a bond rally or a company with a stock rally initially, but it will reverse because of the policies and we will see what happens when the stock market drops with what would be a weak economy with rising bond yields.

>> let's talk more about this with david waddell from associates. good morning. >> good morning. >> what is your take on jeff's comments? >> i think he has little confidence in the fed and policy response. i get that. it has been a challenging environment for investors because the treasury is trying to figure out the fed. i'm a little bit p momore optimc than that. if yields go down, the multiples go up. that is a good thing. for his prediction come to pass, we have a hard-landing scenario. i'm more optimistic than he is. he is a bond guy and i'm more a stock guy. >> okay. do you want to give your take on jay powell's comments yesterday? the cme fed watch tool sees traders pricing in a 75% chance of a pause at the next meeting.

what is your take? >> i think powell was practically perfect yesterday. he basically came out and said there are two pre-conditions for, you know, lower interest rates going forward. one, we have to re-balance the labor market. we are seeing that. it is coming from the supply side which is interesting. that is why gdp growth remains robust. the second part of it is we have to see, you know, gdp growth that's below potential. what's interesting, and this was the most dovish thing in the statement, is the 4.9% gdp in the third quarter, don't worry about that. that was catch up. we are still growing below potential. both of the pre-conditions are there and the fed is in pause and reflect mode. the bias is loosening, not tightening. >> one thing he was concerned about was inflation. he maintained the fact that 2%

inflation is the fed target. we have three more inflation reports coming up before the next meeting. how do you see that impacting the markets? >> the fed in their september sep projected 3.7% by the end of the year. it is 3.7% today. they are ahead of target the way powell sees it. they just are in a loosening b bias. i don't see any more rate hikes. he basically broadcast that unless something weird happens. >> david, i have to ask we are seeing yields on bonds decline root right now. you believe we are set up for a santa claus rally. does that stop in december and pauses? >> that's going to happen. the santa claus rally started in early october and hamas and higher rates hijacked that.

now rates are gathering equil equilibrium. we have the santa claus rally powered by fundamentals which carried the market forward. as we go into next year, we have falling yields. santa claus, i believe. >> falling rates will lead to a santa claus rally and believes the fed is done hiking rates. great to see you. too bad about the phillies. >> i'm sorry. we got the birds. >> great to see you. more to come on "worldwide exchange," including the one word investors have to know today.ovators are making their way for the a.i. safety summit. we have a live report coming up. and falling oil prices hitting the bottom line of shell to 34$4.5 billion.

and later, the metric that investors need to know when the big mega cap apple stock reports after thbee ll today. we have a very busy hour ahead when we "worldwide exchange" returns. stay with us. calories. and cirkul has over 40 flavors, so your water can be as unique as you are. try cirkul. your water, your way. now with even more flavors. available at walmart or drinkcirkul.com. ai has the power to automate, but if it's using untrusted data can you trust the results? your business doesn't just need ai, it needs the right ai for your business. introducing watsonx a platform designed to multiply output by tailoring ai to your needs. when you watsonx your business, you can train, tune and deploy ai, all with your trusted data. let's create the right ai for your business with watsonx. ibm. let's create.

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the power goes out and we still have wifi to do our homework. and that's a good thing? great in my book! who are you? no power? no problem. introducing storm-ready wifi. now you can stay reliably connected through power outages with unlimited cellular data and up to 4 hours of battery back-up to keep you online. only from xfinity. home of the xfinity 10g network. welcome back to "worldwide exchange." a look at futures here and the dow would open up 100 points higher. let's get a look at the trading

day in europe as investors get ready for another central bank decision. julianna tatelbaum is live in the london newsroom with the action. julianna. >> frank, good morning. here in europe, we are tracking u.s. markets closely. it is green across the board. fairly hefty gains. the cac 40 in france up 1.6%. dax trading 1.3% higher. bank of england in focus as it will announce the decision today. widely expected to keep rates on a hold at the 15-year high. that is something investors are watching. the italian market up 1.3%. the swiss market is lagging, but still up .90%. we are seeing outsized demand. industrials leading the way higher. technology stocks peuer perform well.

a couple of earnings in focus. novo nordisk, this is the german listing. record results with sales surging one-third in the first nine months of the year. on october 13th, the company raised outlook thanks to demand to the diabetes and obesity treatments with wegovy and ozempic. it flagged constraints with wegovy. the stock is up 50% for the year. rotating the title thefor the european best performer. and shell raises buybacks with the current period with higher refining margins and solid lng trading. shell is trading 1.2% higher.

frank. >> julianna, thank you. julianna tatelbaum live in london. we will stick with the overseas action which is day two of the a.i. safety summit in buckinghamshire, england. we have arjun kharpal with more. >> reporter: good morning, frank. there were not a hoarde of cameras waiting for me unlike what you see behind the mansion put up in the late 1800s. the big players are arriving. the uk primae minister rishi sunak came and spoke to the cameras and spoke about the conference. that is to do with the risks with a.i. you heard elon musk and others warn about the dangers of a.i. for humanity. others say the fears are overblown. that is the debate.

the uk trying to gather world leaders to discuss the risks and actually how to deal with them. >> arjun, you mentioned risk. i talked to the ceo of palantir. he mentioned discusses within the group about regulation as well in the uk and in the u.s. what are you hearing about regulation? >> reporter: absolutely, frank. a lot of talk about regulation and it is a differing approach through the different governments. a note on the attendees. vice president kamala harris and brad smith from microsoft and alex karp. the reason is because there are some countries, including in the uk, feel it is too early to regulate a.i. because we don't know the technology potential. we need to understand it and identify the risks and regulations can come. on the other hand, you have the european union with canada

bringing forward legislation specifically around a.i. and i'll bring china into the list. they feel if we don't do something now, this technology could run out of control. there are diffiverging views. one thing they are trying to do is identify with a.i. and what level of technology are we talking about here? is it chatgpt or super intelligence? the a.i. that thinks like humans can. that is the level of a.i. and the leaders are trying to discuss here. that is why you hear the risks. elon musk will be in attendance. he will would be -- he will would be speak together uk prime minister as the world deals with how to regulate this evolving technology. >> arjun kharpal live at the a.i. safety summit in the uk.

arjun, great to see you. great blazer. thank you. coming up here on "worldwide fig wh ," a check on the state ofrehtitark vest. a company that has been delivering freight for over a century. we're back right after this. (♪♪)

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turning to the state of freight and the signals in the global supply chain despite

fears of recession we have one company weathering the storm. arcvest with the third quarter company beat and profits surpassing 55%. arcvest operating in the recent quarter and benefitted from the brun bankruptcy of yellow. we have judy with us this morning to discuss arcvest. >> great to be here. >> let's get right into it. what was the driver of the huge earnings beat? 55%. how big was the closure and bankruptcy of yellow? >> it was a an factor. as you step back from it, it really is our strategic positioning to capitalize on that. yellow was the third largest truckload carrier in the

industry. in august, they filed for bankruptcy. that was a significant event for shippers. we also had some additional disruption from este with the cyber attack and recent closure of convoy. all of this is in front of shippers and they are trying to deal with the disruption. they are looking to partners who have integrated solutions like we do to really respond. >> certainly a lot of disruption in the ltl space. this is where your customers put loads on the same truck as opposed to one customer in one truck. i want to make sure the audience is clear about that. yellow previously held 10% of the ltl market. the walmart and amazon, you benefit from the closure, how efficient is the customer gains and market share gains? >> who we have been able it to

help are customers we know already. those customers came to us quick w quickly and wanted additional solutions and we were able to respond. we feel there are things that will shift around as time goes on here. you know, we have done an excellent job serving these customers and we feel like it will be a sustainable change in our business and it allowed us to optimize the ltl network we run and make good selections and choices with other parts of our business. >> we are looking at results. revenue per weight is up 9% in october. you gave investors is update for the current month. a bullish sign for the freight market. what do you see for the holiday season as we look ahead to the holiday season? what are customers telling you about demand and inventory

needs? >> it is interesting because the overall demand environment is weak. this disruption is playing a role in it. we he e feel as we enter octobe robust opportunity. a lot of the work we do is in the manufacturing sector and the latest read on that is a little bit weaker. what we're doing is navigating this opportunity set and helping our customers as best we can which is an opportunity in october and beyond the quarter. >> i want to ask about the overall picture. a lot of companies say we are in a freight recession. jb hunt is the notable one. what is the environment? are we still in a freight recession or is it a shift from goods to services? >> i think it is the shift in spending from goods to services.

there has clearly been a pressure point that we have seen on the rates. especially in the full load arena. some of that is because of the capacity that is serving the industry that comes from the recovery that we saw in 2021 and 2022. you know, we do see some impact of inventories runoff. we are hopeful as we enter 2024 that things will come back to a more normal level. right now, we are in a weaker demand environment. >> judy mcreynolds, you see a possible rebound next year. judy, thank you. we turn attention now to a market flash. six flags and cedar fair is merging in an all-stock deal. cedar fair shareholders owned 51% of the combined company.

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it is 5:30 a.m. in the new york city area. there's a lot more ahead on "worldwide exchange." here's what's on deck. stocks riding a three-day win streak after the fed is on the fence about raising rates again, but promising higher for longer is here to stay. and it is not just powell pull making waves. stanley and jeffery are sounding the alarm which has been two years in the making. and apple reports after the close today. we breakout the number you need to watch. . . it is thursday, november 2nd, 2023. you are watching "worldwide exchange" here on cnbc. welcome back to "worldwide

exchange." i'm frank holland. we pick up the half hour with the check on the u.s. stock futures with the s&p 500 riding the best three-day percentage win streak since march. futures are green across the board. the dow would open up 100 points higher. the bond market here with the ten-year yield is down from recent weeks. the two-year bond is back below 5%. we turn attention back to really the story of the morning. the fed sticking to thep expect keeping the range between 5.25% and 5.5%. the fmoc decided to pause following 11 straight rate hikes, including four this year. in the statement, the fed noting the economy expanded at a strong pace in the third quarter and the labor market is moderated,

but strong. p jay powell said the risk of doing too little is balanced. there is a long way to go to reach the inflation target of 2%. powell stressing the fed has not made any decisions about the next move. >> it's fair to say that is the question we are asking. should we hike more? it is not -- that is the question. you are right, in september, we wrote down one additional rate hike. we will write down another forecast in december. >> let's bring in former fed vice chair roger ferguson and past president of tiaa and cnbc contributor. roger, great to have you here on a day like this. >> thanks. good to be here. >> what did you make of the jay powell comments and especially the 2% inflation tar gget? >> i think he was on script.

things are looking good, but he has not yesterday achieved the . he is not ready to say they're done. he was honest and straight forward and stayed to the s script. >> we have two inflation reports coming up. one coming out just two days before the next meeting. is this really that important or is it just the last one? >> he said it is the totality of all the data. all of them do matter. i will say that the one that is just before the meeting is the one that is very much on people's minds. we should be careful not to fixate on just one piece of data. he was explicit and clear they are looking at the data overall. yes, cpi and pce and labor

market is something they are interested in. there are a number of factors we all have to think about and no one should get overly fixated on one piece of information that comes in. >> what did you make of jay powell saying that hotter than expected gdp report? that's not that big of a deal. i think a lot of people in the market were concerned that might lead to the fed to hike. >> he said higher for longer. i interpreted the statement and comments as accurate. one, the number came in pretty hot. i would say if there is another, that leans to the hike. it is all consistent with taking in all of the data as opposed to one. having said that, they hea attuo the facts fact of the economy.

>> we had two big market voices speak with cnbc yesterday. druckenmiller and dunlach. i want your reaction to their comments. >> high are for longer means we have a massive interest expense problem. a massive interest expense problem in the country that i believe is the next financial crisis. >> the chart is frightening. it goes like this. all of this stuff is ahead of us because we did not extend the maturity of the debt. it will rollover and you will replace the 1% stuff with 5%. >> comments from gundlach and druckenmiller. how concerned are you? >> i don't think i would phrase it with the tone they used.

i think the facts are correct. there has been a regime shift, if i can put it that way, to higher for longer. when there is a regime shift, the risks go up. i think they are right to point to these things. there is a heavy interest charge for many companies and individuals and the government that we all have to take into consideration. you know, i think they are right to say not over yet. there is a reason why some private sector economists and others are still forecasting downdraft may lead to recession. i agree with them. with high er for longer, with higher interest rate charges and there are increased risks. i would not use the exact tone they did, but the facts are true and we need to monitor things closely. it is not over yet. >> roger, do you think the fed

is done or could when we see one more hike? >> it is possible we will see one more hike. it depends on the data. i would not yet say it's over. let's watch the data. by the way, i would say december may be alive, but it could be if the data called for it, it may move in 2024. not over yet. let's watch the data closely as they are and listen closely. >> roger ferguson saying not only is december alive, but 2024 as well. thank you, roger. >> thank you. we turn to apple. shares moving higher ahead of earnings due out later today after the close. shares are down 10% in the last three plmonths. we have steve kovach with the latest report. >> reporter: will the company

guide to top line revenue growth? apple is expected to report the fourth quarter in a row of declining sales means 2023 will be a drop in the sales of computer and phones. as for the holiday quarter, analysts are expecting to guide to $123 billion in revenue which would equal about 5% growth. many have trimmed estimates following the data shows weak desk demand for the iphone 15. comparisons will be easy with the shutdown in china with the outbreaks of covid. keep an eye on services revenue and signs that signals growth will re-accelerate. some signs that app spend is increasing after stagnation

coming from the pandemic. frank. >> joining me now is a shareholder at essex investment management. apple is the biggest holding for her firm. nancy, good morning. >> good morning. >> what witdo you expect from t upcoming report? how concerned are you with the signals of the weaker iphone 15 demand? >> clearly, the iphone 15 demand is an important metric and the demand in china. i would not say we are sanguine about the outlook, but at this point, there has been a lot of negative reports so our expectations have come down. we had good results from qualcomm and corevo which pointed to increased demand as they build the iphone 15 and a sign of stabilization and increased demand in china.

our best guess is that this quarter will come in reasonably in line with expectations and the guidance for the december quarter could be a little better than what the tempered expectations have been. >> nancy, i want to be clear. steve pointed out 5% growth guidance for the next quarter. that would be seen as good. you say you see it coming in higher than that? >> i think the stock has discounted a lower growth rate than 5% growth. we have seen numbers come down. a lot of analysts are looking closer to $120 billion of sales in the quarter with. i think 5.5% growth is a possiitive surprise. >> this week, apple held a nighttime event with m

mac computers and chips. how important is a.i. as a shareholder? >> i think the market is looking for signs that companies are aggressively going after the generative a.i. opportunity. that is no different for apple. we don't want to see hype come from apple. it is important they layout where they are going with a.i. and how they will capitalize on the opportunity. we look forward to it on the call. >> apple trading 30 times forward earnings. a lot of people feel that is lofty. as an investor, how do you feel about the valuation? are you considering other moves adding or trimming based on this report? >> the valuation is, i would say, fair here. it is not expensive like it was in the past. however, as we know, the valuation is a guide, but not a determining stock price performance. we will see what they report in this quarter. again, we want to make sure they

are the not losing tremendous share in china. we want to see services growth. we want to see the a.i. opportunity and how the stock reacts to the quarter they report and decide whether or not we want to make a move in the stock. >> all right. nancy prial, thank you very much. you are feeling bullish of the holiday quarter. great to see you. >> we are. thank you. as we head to break, a check on ia few more of the big money movers. doordash logging a record amount of orders in the quarter up 24% to $543 million. shares rising just over 9%. shares of qualcomm higher after earnings beat expectations despite the year over year drop. they issued a strong forecast for the quarter. shares up 5.5%. let's make it three.

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welcome back to "worldwide exchange." time for the morning call sheet. citi is upgrading clorox to a

buy and raising price target to $150. it is moving beyond the cyber attack this summer and working with retailers to build shelf space. shares are up 10% this morning. truist cutting solaredge from hold to buy. it underestimated the speed in europe. shares of the company are down 18%. rbc downgrading estee lauder and cuts the price point to $115. it believe thes there are too m headwinds to believe it has a second half growth story. shares up .50% in the pre-market. time for the global

briefing. japan revealing a $113 billion spending package including tax cuts to cushion the impact of inflation and wages. the japanese government will put together a budget for the fiscal year worth 13 trillion yen bringing the total value to nearly 22 trillion yen. novo nordisk posting record sales and profits for the third quarter due to the weight loss drugs wegovy and ozempic. it is planning to keep restrictions on supply in the u.s. shares of shell in the green. the oil giant reporting $6.2 billion in third quarter profit as it benefits from lhigher oil prices and margins. shell announcing a $3.5 billion buyback and calling the $6.5 billion set for the back half of the year in excess of the $5

billion announced in june. the latest federal reserve decision in the u.s. the bank of england set to announce the decision where they are expected to hold rates at 15-year highs. we have joumanna bercetche outside the boe this morning. >> reporter: good morning, frank. the market is not expecting the bank of england to hike rates today. the expectation is to keep it at a 15-year high. they surprised the market by not hiking rates. the split was 5-4 and andrew bailey cast the deciding vote of keeping rates at 5.25%. the headline inflation is 6.5%, but there are signs of softening conditions. this gives the bank of england

justification for staying pat. today, they will release the updated projections as we talk about rising oil prices with gas prices on the move higher with the lower interest rate assumptions now the market is pricing in the right of 5.25% and weaker sterling means the bank of england may upgrade the inflation forecast. if that does happen, it would not be surprising they come out with a hawkish pause. they will likely maintain the wording around keeping rates restrictive for sufficiently long to get inflation back down to 2%. the messaging is key. from here on, frank, it is about how long they keep rates at 5.25% and the timing of the first rate cut. back to you. >> joumanna, thank you. european stocks up 1% across the board. joumanna bercetche live outside the boe ahead of the decision. thank you. coming up on "worldwide

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welcome back to "worldwide exchange." time for the "wex wrap-up." we start with the department of justices investigation of the ticketing scandal for ticketmaster. the agreements to book talent and serve as the ticketing provider for the shows which are anti-competitive. disney combining to buy the remaining 33% stake of hulu. it expecting to pay comcast $8.62 billion next month to secure the deal. show delta airlines is cutting corporate jobs to offset

expenses like fuel and labor. it did not specify how many jobs it is cutting. wall street journal says six flags and cedar fair is merging. cedar fair will own 51% of the company. shares of roku are taking off after the third quarter revenue beat. roku says the third quarter sales surge is due to content and advertising and sales of the roku branded tvs. boeing is expecting a cyber incident that impacted the parts and distribution business. hacker group lock bid stolen a tremendous amount of data from the company. boeing has declined to comment if lock bid was behind the incident. shares are flat right now in the pre-market. here is what to watch today.

weekly jobsless claims out at 8:30 a.m. and third quarter productivity and earnings. we will hear from apple and booking holdings and starbucks and shake shack. the fed is not the only central bank in town. the bank of england reports at 8:00 a.m. eastern time. the dow and s&p 500 extending the winning streak to thro three days and nasdaq is extending to four days. we have liz ann sonders with us to discuss. >> good morning, frank. >> after the jay powell comments, you see futures moving higher. are you surprised? >> no, because the stock market is keying off longer-term yields. expectation was in line with what the fed did yesterday. i think it is not so much on the

short end that we're seeing a driver in the equity market. i think it is the long end. it was october 19th with the ten-year yield which reached 5%. now we are down at $4.75 and driven by the funding announcement and dovish comments from powell yesterday. i think yields are continuing to be in the driver's seat. >> that is interesting. you thought it was dovish com commentary. >> the expectation was for a pause. the assumption going in would be it was a hawkish pause. he didn't close the door to another rate hike, but i think cemented the idea that a continuing in pause mode makes sense as they assess the tightening they have done with the long lag and impact on the labor market.

>> your take on the dovish pause, what is your word of the day? >> done? i said that with a question mark at the end of it. i think there is a decent chance the fed is done, but the door has been kept open for maybe another hike. i think the jobs data and inflation data between now and december will be why the needle moves. >> in the current environment of higher for longer and done with a question mark and you are saying free cash flow. i want to show the audience, not your pick, but the top three free cash flow generators. these are not your picks, liz ann. why is this important? >> it is one of three metrics.

high free cash flow and coverage and self funding companies. companies which are not at the mercy of rolling over debt or come back with market forces or go to traditional lending sources. they can fund the interest on their debt. many took on debt with the zero interest environment, not because they needed to fund operations, but did so because it was cheap to borrow and buying back stocks. you want the self funding companies that are the anti-zombies. >> liz ann, mixed there. it is always great to see you. thank you. >> good to see you, too. one quick look at futures. the dow would open up 100 points higher. we have to leave it there. we have "squawk box" coming up next. have a great day.

good morning. futures are trending higher this morning following the fed meeting. no moving on rates, but the door remains open on hikes. another big morning with earnings with eli lilly and moderna expected this hour. and apple is cleaning up after the bell. and disney is going to buy the rest of hulu from comcast in the latest episode in the streaming wars. now it's all about price. it's thursday, november 2nd.

election day is coming up. 2023. "squawk box" begins right now. good morning. welcome to "squawk box" here on cnbc. we're live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. the fed holding rates steady as sp expected, but the door remains open for future hikes and levels remain elevated to tamp down inflation. the central bank saying the economic activity is at a strong pace in the third quarter. steve liesman will be with us to break down oall of