i think when we look to what's likely to happen next year, we could see more of a broadening out. if we truly had a risk-off move in the market, i don't think those large cap tech companies will be as protected as treasury bonds. >> brenda, thank you very much what a day a lot happening. >> are you here tomorrow >> nikki haley >> make sure you join us tomorrow for that interview and so much more "squawk on the street" begins right now. good tuesday morning welcome to "squawk on the street." i'm carl quintanilla along with jim cramer annual ratings come in cool. ten-year back below 4.5. yields fall and futures are surging as annual core hits the

lowest level since september of '21. >> home depot's tepid outlook. it sees the consumer pulling back on home improvement products shares of nvidia seeing their longest winning streak in seven years, and certainly given the open, looks like there maybe more to come it's a long day, carl. >> let's get it started. we begin with market reaction to cpi, jim core goods down a tenth. used cars, hotels, airfare all down. >> look, it's a win for the anti inflation's stas when you look at what's not great, natural gas could change. i think the good news here is used cars. we flagged that earlier. apparel is not going anywhere. shelter -- i don't know. shelter is not bad .3 transport point 8. this says to me pay more -- i

didn't have it in the fine print, it says pay more for stocks of companies doing well i read that, an annotated version. it says that in the cpi, pay more >> not that we need to tell people when you're right, you haven't been in the camp that powell is going to get it ride this is another example of added evidence -- >> you're very kind to say that. my coffee cup, the top wasn't on it would be one of those areas -- >> scalding like we've rarely seen in this set i'm here for you. >> the opposite of what costanza experienced. this is very important, jay powell has been doubted, sometimes ridiculed, often thought of as someone over his head you know what? shameful, shameful

carl, the man has done so many masterful things he also knows how to close the door. >> he does he has others close the door. >> we find out who he is the guy is actually a human being and the last fed chiefs weren't. he's human one guy was like, my dad was a salesman that makes me great. give me a break. >> your enthusiasm for a year-inderally has been tempered lately does this affect that. >> you have a group of companies like alphabet selling at 21 times earnings meta selling a little bit more times that you have amazon putting up a great quarter, nobody seemed to care nvidia i have price targets -- we could have an nvidia show. >> we'll talk about it, going for ten straight wins today.

>> nvidia is the company that everybody wishes they weren't. it's an amazing thing when you see unprecedented combinations, supply chain rant, tight availability, that's the goldman stanley note deutsche bank, would president be surprised by another beat you're looking at companies that people are raising the october to january by $2 billion david, i've got to tell you they make something that is precious. this is like the 9ers, the 49ers. when we didn't have a lot of gold the next thing you know, we've got gold ever been to the mine in jackson? >> no. >> don't go. it's too depressing. >> magnificent 7 continues to outpace the rest of the market and is still the market. we all know or have some familiarity with these statistics, with the s&p 500,

equal waited, though not doing much a little bit but not much whereas the seven -- >> look at that number 95%. >> these are amazing companies david, you yourself, when you looked at the amount of profit, you have these companies doing like $10 billion, $20 billion, $30 billion. remember the amazon web services number, how great it was jassy is still firing people there were gaming people who lost their jobs yesterday. sometimes i say, i'm really down, let me go buy shampoo. my wife said, why did you buy those, biolage for make your hair be bigger i don't know, i just picked the top thing. i ordered a book that was out of print for 15 years there it was, it came to my house within the next day. >> buy while you're perusing

snapchat. >> that's right. advertising on snapchat. not a bad deal for snapchat either potentially. >> someone put out a note today it was bad for meta because chinese .3 sales that person has got a lot of time on their hands. that's what i said that person played quarterback last night for the bills it's like no, you weren't there and you're not here. >> did the bills lose that game? >> they did. >> david, do you know what this means? besides i have no hair >> is that what diggs did when he realized? >> no. his brother was very critical. i knowshon mcdermott he's a great guy let's say they were like fair, the battery company. imagine you're a broker. let's just call it -- you read these things hey, mr. so and so, i got -- i

have a rivian piece of paper rivian could be the car of the future when you're buying bonds, you don't want the car of the future you don't even want the car of the present. >> you haven't shared anything with people. you have an expectation that everybody out there has a clue to what you're talking aboutment what i believe is you're talking about they'll issue up to $15 billion taxable revenue bonds for the development authority, building giant plants in georgia. >> that's what i meant i got ahead of myself. i'm sorry. >> they need to raise enormous amounts of money in order to continue to build these automobiles. obviously they want to keep trying to lose as little as possible on each one. >> they need a lot of money. that's what tesla did. interest rates are going up. you know what? they got a little break here with interest rates today. maybe rivian is one of those companies we ought to look at.

the trend might be there. >> a lot of companies can use rates to move lower. no doubt about that. >> there is a backlash. >> continued concerns, particularly about the small and mid cap companies that will be dealing with far higher interest costs. >> the empire strikes back you have rbc and goldman. >> defending the adoption curve. actually rbc boosted their targets for penetration. >> i was surprised to see that, particularly because a lot of the big three are losing money through their eyeballs tesla has been up day after day, after a not great quarter. no one seems to company. i want to go back to five new companies that beat the numbers. i like doordash. i liked airbnb i'm not going to etsy because

they're one of the worst performing stocks this year. maybe the best one, uber i thought uber had a remarkable quarter. my big three are uber -- i like uber airbnb -- are you squinting? >> not squinting at all. i'm listening. >> you lowered your voice so much. >> you said earlier i'm jumping from here to there, non-linear have i ever presented as linear. >> i try to fill in the actual gaps including the actual headline you might want to tell people what you're talking about. >> talking about land in florida. i'm talking about -- here is what i'm getting at. this cpi number allows people to go and overpay for everything and find someone else who will overpay even more. that's what i call the market. >> well, we've got some home depot numbers to play with as

well the dow component did post a quarterly beat despite a revenue drop comps down 3.5 in the u.s. the company said it saw demand for smaller projects but adds customer pulled back on big-ticket items narrowed their full year guidance low tax rate -- >> i thought this was going to be just a blowup i said, listen, we keep reading things are so bad. then i come back, what stocks are going to be up the most today? it's going to be toll brothers, horton, pulte. maybe home depot has some good things, especially because as mortgage rates go down, you'll be able to sell your house, get a heloc, home equity loan. the negatives on home depot, maybe we'll have theft commentary i think ted decker delivered i think people who want to sell home depot, they should pound sand. >> a note out this morning

pointing out the numbers continued to come down, which is not uncommon companies will talk to the analysts and basically sort of massage things down ahead of a quarter in order to beat, whether it's on sales or earnings that happens often appeared to be the case here just a few weeks ago the numbers were higher. >> two weeks ago the stock was at 330, now it's like 288. a few weeks ago jafwa. >> the jaf wah game. >> yeah. we had a number this morning which says mortgage rates are going lower. >> your point is the numbers did come down, but the stock also actually came down. >> i'm just saying when i see a number that says this was not a

major miss, and then i see interest rates down, people are going to gav tate toward home depot. >> citi has a great chart of lumber prices this morning, 3% above 2019 levels average in 2019 >> very impressive. >> what was our high >> 1300, right, jim? >> yeah. that was a short squeeze, had to do with canadians and tariffs. the one to watch, whirlpool had a really bad quarter, maybe the worst of the entire earnings season. >> that's saying something. >> of the majors i'm not talking about companies like skin. that's the part that home depot knows isn't doing that well. you don't really have a lot of others because the other companies are made, like lg -- i don't want to short lg or something. >> whirlpool is a -- under $6

billion market cap. >> they missed a quarter they did this joint venture with ars lick which is the turkish appliance company. when people thought they were going to sell the european bilz right away david, look, i love -- ars lick, it's the whirlpool of turkey. >> of course >> i don't want to just throw my lot in with -- how much did the turkish lira drop while i've been talking >> it may have dropped a lot. >> your point is related to home depot with whirlpool how >> they offloaded their european -- that's did a joint venture with ars lick. i was looking for a sale to lg that was going to be money in their pocket it was all going to be good. up gendz some headwinds that may turn -- >> you need to know the ten-year is around 4.46 >> well, let's buy. >> we were 5% 2 1/2 weeks ago?

>> david, go buy at&t. >> ooh, boy. mark the moment here. >> -- >> -- >> a lot of times figuring out how to get in your head. >> that's the company i probably hate the most in the s&p i hate them the most, most in the s&p. >> they were so happy for a minute there now you dashed all their hopes. >> you know what i don't care go buy meta. take advantage of the fact that tamu is coming or sheehan. >> sheehan is the greatest. >> henry shrine versus sheehan >> the greatest non-public company. amazing at a push. >> whoever sheehan hired, hired him again. i want to hear from them again i haven't heard from sheehan enough. >> it's been a few days. >> do we wrap it up nice i feel like i covered probably

280 of the s&p. >> great show, jim we'll see you tonight. >> formula one. >> when we come back, what the treasury secretary said about china ahead of tomorrow's biden/xi meeting ten-year, 4.46, the lowest since september th25 futures are rocketing higher back in a minute ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ meet gold bond daily healing. a powerhouse lotion that moisturizes, heals, and smooths dry skin. with 7 moisturizers & 3 vitamins. and... new gold bond healing sensitive. clinically shown to heal & moisturize

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industries reflect china channeling financial resources to firms that produce in these industries and that there could result in overcapacity, that is an issue that we talked about and that i think they understand we did talk about issues of oversupply that have arisen and could arise in the future in industries that china is investing in very heavily, and i do consider that a risk. >> that's the treasury secretary talking about china last night in san francisco ahead of tomorrow's meeting between president biden and xi a couple instances about how xi needs a win in the words of "the washington post. foreign direct investment has collapsed. a piece of how their gdp is now

64% of ours, used to be 75. >> in 2021, now down to 2017 levels. >> i thought this piece in "the washington post" was devastating for xi, including a picture where it shows you -- belt and road -- used to go to milan and there was nothing but belt and road signs china -- they have a picture of steadily falling meters in belt and road belt and road being the apex of china in terms of them doing what we would have done, say, during the marshall plan i think this piece basically says that xi, while it does point out, is in control of china, says he's not always in control of china devastating piece. if i were president xi and i read this, i'd say i've got to call buy soezos fired.

>> the manufacturing base is somewhat unchallenged just given the size, the expertise, the number of employees still working in ways that others can afford >> they're a high-cost producer versus mexico. >> but they have so -- they're so embedded in the supply chain. >> i agree with that you try to move it to vietnam and mexico david, the one thing i would say is we used to pride ourselves on having companies open, open factories there. now we have apple. we have starbucks. we have nike those are all by the company for the country. and then, i don't know, that's really kind of about it these days. >> carl, what are the expectations coming out of this thing, maybe something on fentanyl >> that's the big discussion, is

what deliverables do you get -- >> stop poisoning our people if you stop poisoning our people, maybe we'll sell you a plane. isn't that part of like the council of nations, not supposed to poison other people. >> it's an enormous issue in so many different ways in society yes, fentanyl does come from china, gets smuggled through mexico the deaths from opioids in this country are staggering. >> isn't it the number one hope that we establish military communications >> i think the main thing we're worried about is xi comes here, goes back and they keep doing this stuff in the philippines and keep challenging taiwan and get involved in the democratic elections of taiwan. they still hate it when we identify taiwan as a separate country. taiwan semi is the most important manufacturing company on earth. >> yes, i know that is true we could talk about nvidia all we want. >> taiwan semi and a lot of

things go off-line. >> yes, they do. taiwan semi and most important -- most important computer, most important hyper computer. >> might have to start reading actual books around, thinking, reading. >> reading about schizophrenia, trying to read about mental illness, who are these people on the streets? why can't we help them more? the answer is it's fentanylschia whoa could have a mental health network and i think we would be doing the country a great service. >> we'll get cramer's "mad dash." rallying here on a cooler than expected cpi

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watching the ten-year responding to that cooler than expected cpi, down 15 basis points from october 19th closing high of 499. we'll watch that closely huge implications. opening bell in a couple minutes. don't forget you can catch us any time anywhere listen to and follow the "squawk on the street" opening bell podcast.

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let's get to a "mad dash," opening bell less than two minutes from now want to talk a little procter & gamble >> a lot of times people say, i see all the stocks up big and i don't want to come in on top of them that's just a recipe for disaster do i really want to come in on top of nvidia. okay the company that may actually

surprise people that goes up today is procter & gamble. they had an $800 million potential hit from the dollar. david, the dollar is sinking like a stone we're down to where it was in the middle of september. so you're probably looking for a play on a weaker dollar. i can give you apple, but apple is already going to be up so m much proctor had this great tailwind on commodities, and then obliterated the upswing by saying the dollar is going to kill us. no, buy p andg and just ride it. p&g is so much better than it used to be. >> is it >> they're gaining share against everybody. i think that, dare i say, if i were unilever, huh-uh.

i would say, wow we ought to get more -- [ cheers and applause ] >> a lot of green at the open. let's get the opening bell and cnbc realtime exchange celebration of national philanthropy day at the nasdaq, it is dexcom. >> obliterated by the gops don't tell that to the hundreds of thousands of people who rely on their technology to not have to pinprick their finger. >> world diabetes day today. 4,470, jim what do the bulls need to do to make a statement >> have mike wilson switch his perspective at this very moment.

i think what the bulls have to do, even if rates don't do anything more, hold these levels a lot of times what's happened is when we have these opening, the heat-seeking missile sellers come in and say, listen, i finally got what i wanted. it's very rare that an up opening has produced closings as high as the opening. i want people to understand, when you have it like this, it's quick sale you'll come in and say, oh, why did i buy it that high let's be careful and not come in and buy something from the nasdaq up 1.8% and just instead say i missed it, i missed it i wasn't there for it and now i have to wait because we're overbooked. >> got some fed speak on the docket no more auctions, the things that sort of undid the progress last week. victim rose of the journal says the challenge for the fed will be adjusting the language to reflect the obvious. the fed is on hold. >> look, he's the fed whisperer.

i would point out that, if you saw nat gas go down, that would be -- they'd have a hard time. you go to the negative numbers i think the one thing the fed can say is, you know what? housing, it's still up it's still up 30% in 2019. we're not done david, you know and we'll hear that from home depot, it's still too expensive to buy a home in the american country and that's the american dream that's what jay powell can hang his hat on. >> also difficult to sell a home when you have a lower rate mortgage on it because the prospect, again, of buying a new home and putting in new financing at a much higher rate makes it more difficult. >> right horton is building some more low-cost homes that are not as expensive. in general, carl, that's the sticking point we need to see more apartments

we need to see rents -- >> that's happening. >> it's happening, but not to the point where i think i can go buy a home that is anywhere near what it was in 2019. i know food was good my wife and i went -- here is a little anecdotal which means anything nothing we went to ruth's chris. i was in a celebratory mood for no particular reason we ordered the fillet and didn't look at the prices i had a new jersey beer. new jersey is known for having the fine efrpt beer. >> delicious. >> exactly brewed on the shores of the delaware river bay david, my wife happened to have a cosmo, and the bill came she said guess >> $275 -- $300. >> why did you ruin the story? >> i do eat out still, so i understand >> it was $200

in retrospect, a big bargain. >> you did great >> that was the purpose of the story. why don't you wreck everything i come in with >> food away from home is sticky food at home year-on-year 2-1 is the best number. >> the conclusion i was getting at, we should go to the supermarket, ala tyson foods which is a parody of a shame of a mockery and bought a fillet. we should have stayed home did you see the upgrade of kraft heinz? >> i did not >> bernstein had contrary research. >> they talked about apple having -- smucker, right before -- the day before the gop craze, they went and bought

hostess twinkie. a lot of people feel that was the worst acquisition since, i don't know, snapple. >> like read the room kind of thing? >> look at the penalty that they had to pay it's much more than -- they can walk away from it. >> you're right. did they not know about glp 1s >> wasn't a focus. there's ways to try to reinvent a twinkie. the problem is you don't crave twinkies, right? you don't crave twinkies, you don't crave clorox. >> there was a time -- we talked a lot about craft heinz, if you recall, not a good deal. >> you don't like those kraft -- remember you'd have lunch and it would be the kraft slices. king oscar in a can, you better let him out. >> i did a lot of chef boy r dee

ravioli. this is back when i was in my early 20s. it was delicious. >> little did i know that he didn't have two nickels. >> and then chips ahoy for dessert. >> we had hydrox because we couldn't afford -- >> couldn't afford the real oreos. >> you warted down your tang. >> nothing wrong with tang the astronauts used it if it was good enough for them, it's good enough for me. david doesn't realize this is really a rally based on software, enterprise software is all doing fairly well, incredibly well. >> well, we do have adobe -- replaced crm with it. >> -- can i just point out, and i know i'll get a text within 22 seconds.

david, start the clock. >> service now once again hitting an unbelievable high ever since bill mcdermott sat there and told us, david, ai, ai i'm not talking about number three. i'm talking about ai. >> service now, yep. how long till you hear from him? >> i'll wait >> let's start the clock you know how they have that great stop watch. >> the clock is set. >> there's also microsoft, jim, the ignite conference, wells go to 24 today. they're looking for 100 ai product announcements. >> let 100 ai products bloom xi must come here and say, can't we get any of this technology? you know how when khrushchev came and slammed his shoe, didn't get to go to disney land. that's xi. i want this. i want this grace hopper who is this grace hopper

>> not going to get it china, roughly 50% of the world's low-end chips over time. >> that's great. that's great let 100 hair dryers bloom. >> a lot of things they're needed for >> what? to make a keurig >> they're in everything, everything >> david, they're not in high der performance missiles. >> no, that's why they don't have any. >> in washing machines hey, robert -- he bought 15. >> boston properties leading the s&p. >> i've been working with boston properties i did a piece on it. are you ready for this they have no inventory their even own -- what do you think would be the worst property in the world, the salesforce tower it's filled. it's filled. >> it's not actually filled. >> it is filled. >> it's got people paying rent.

>> no! oh cantrare. it doesn't have any spare inventory. >> meanwhile, lilly is lower that's the revenge of everybody you think should go east tasty cake cakes and pies. how about starbucks going up despite the alleged labor movement >> indeed. >> had the seasonal chai, the gingerbread chai oh, my god, david. i'm going to get you the gingerbread chai it takes starbucks to 110 as far as i'm concerned. >> they did a good sale with boston properties. we talked a great deal about commercial real estate for a long time. >> one of the stocks has been a proxy, up 9%. >> let me give you wheelhouse. how is warner brothers discovery doing? >> up today, jim

paramount up 7%. again, to your point, these are highly levered companies and they need -- >> -- >> the size of their balance sheets -- the liabilities. >> but does zaz -- does david zaslav have to worry about the balance sheet short term >> no. >> i rest my case. >> let me come back to a name you like -- >> solar >> not the semiconductor company, the sneaker company. >> the shorts rated down even though the number was good the shorts banged this down to 23 today, heavily shorted stock, 8.8% of the stock is floated they make their presence known that said, everyone is tired of the pebbles in the bottom. >> i told you, man, they squeak like crazy i had to stop wearing them

>> we're going to talk to them >> ask them what i can do about my squeak. i spent 160 bucks on them and you can hear me walking from two blocks down the street i switched to hoku. >> jim, espn bet goes live in 17 states today -- >> i just think that, don't mess with draftkings. they have the cleanest, greatest app in the world you can play against friends, dfs. the app is so simple they have like the best things hey, bet that mccaffrey has a touchdown. >> did that streak end >> i had that one wrong. >> nothing compares to a.j.

brown's streak, right? >> a.j. brown is built like a linebacker and he's a running back guys -- howie can you send me a signed a.j. brown shirt. howie watches the show got to know what he says you know that, right >> what are you muttering? >> i'm just saying a.j. brown. >> we've talked a lot about football 82 of the top 100 broadcasts during 2021-'22 were the nfl. >> they're going to tell me the app is every bit as good you can't even play in new jersey -- can't play in new york -- oh eh, eh. >> people on twitter are informing me about the bxp sale of those properties, life sciences, which has been a strong former overall in the commercial real estate market.

they sold 45% interest two life science development properties in the massachusetts area, boston area, as you might expect. >> very smart operators, and it does matter. the smartest, david, is still david simon,simon properties. >> they're not office. >> who wants to be in a high-end mall they do. they own a lot of stores there look at that oh, my god, david, reverse head and shoulders. >> they're all moving -- >> -- >> -- >> why are the solar stocks moving so much. >> rates. >> total rate call. >> -- stocks going up. >> have a lot of refinancing companies. >> no. >> ten-year going below 4.5, all the algorithms are saying buy the hily levered companies. >> you're right, david right as rain. i still say buy the magnificent seven.

the service is a little disappointing. it's been ten minutes now. >> i am getting people saying that they're sneakers also squeak this is a big problem. >> we haven't mentioned bofa saying cash -- drops to 4.7. they're dumping cash, buying bonds. >> where were those guys >> they're begging now to get in they're not clown, v i was called for soft landing so early that the plane was like -- just took off, david now that's one of the reasons why i'm a little skittish about coming in on top of that they should buy chub which is down a lot. >> don't often venture into aircraft leasing, aer did. >> -- a horse, man. >> -- did a big deal last night.

it points to the ge with its spins and splits as opposed to the kenvues of the world ge sold -- some bought back by the company. but it basically cleans out g ef >> did you see who is going to be the chairman of ge very nova? steve angel who made lindy into the greatest industrial chemical company of our time. he's going to run, going to be chairman they have a powerhouse group of people i think that stock is a buy. i swear to god that stock is a buy. never would have said that >> got it. >> got it? how about give and take. how about saying, jim, the

turbin business, they should call them turbines the new jersey wind project has been canceled. >> it has been canceled, it was so costly. >> i wanted pushback. >> everything is working here, jim. >> super discretionary up three. >> rh is up. >> rh is up, tesla is back to almost $750 billion market cap. >> even though they had a terrible quarter. >> nvidia, $1.22 trillion in market value by the way, apple knocking on the door of $3 trillion market cap again. >> russell, this is going to be one of the best days of the year. >> apple is a good one to talk about. when it was downgraded by key bank, 177, you know what it's done. if you try to take out the king, you better kill it otherwise, you downgrade apple, you're flirting with heresy.

it's like st. catherines sienna. st. catherines >> i got nothing i got nothing. you go to those kind of references. >> what are you jeff probst? >> st. catherines of sienna? is that what he said >> yes. >> she was an amazing saint and believed in things no one else did. boom, soft landing apple -- apple has been wrong -- >> a believer in apple is what you're saying. >> she had a buy on very low price years ago. >> this is before jobs was there, the scully days >> it was early. >> she knew they were going to skirt bankruptcy. >> she famously said, own it, don't trade it >> that's where you got it >> dow up 420. obviously a huge opening gain here, just about 18 points away

from 4500, all sectors are green, bonds as well still have got fed speak to get through today. but for the time being, you do have the ten-year back below 4.5. >> people saying, listen -- don't give up on amd i'm not. >> quite an open we'll be right back. ♪ you were always so dedicated... ♪ we worked hard to build up the shop, save for college and our retirement. but we got there, thanks to our advisor and vanguard. now i see who all that hard work was for... it was always for you. seeing you carry on our legacy—

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hellomedicare licensed insurance agents. hellomedicare. say hello to an easier way to do medicare. . take a look at the nasdaq 100. of the 100 components, only one is red that's pdd that's going to be the best day, at least on pace for the best day, for that index since the middle of july as the dow is up 430 now. we'll get stop trading with jim in a minute.

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let's get to jim and stop trading. >> this rally in the home builders is one for the books. we had this group rolling over a few weeks ago. lennar is up $6.85 toll brothers just screaming higher expensive homes.

million dollar homes up $4.89. horton making very, let's say, homes that are not that expensive, up $6.29. david, carl, i have to tell you, this is the reversal of everything that was -- that playbook said and people are short these stocks and thought this would be -- another fed rate hike would roll them over look at these companies. not that many home builders building many homes. that's the group that i fear the least about. you think rates are going lower -- >> is this an illustration of what people talked about positioning setting us up? >> they were so wrong. people thought this was the group the fed had in its sights and would destroy it fed never got to it. very good for home depot by the way, in case you bet against home depot target reports tomorrow and maybe even target comes back a little this is an amazing rally i mean no one was -- >> rates, rates.

>> always rates. >> large balance sheet, refinancing risk, reit, commercial real estate, services. >> forget it, david. it's rates. >> it's got to be driven by most of the algorithms. >> the algorithms wrong again. >> they have to be right now to market - >> yes but this is an amazing rally and was not predicting we're seeing the results that no one expected, except for jay powell congratulations jay. >> it's off that 10-year. >> david, you don't have to phone the runway. >> some of these companies will still go bankrupt. >> not the home builders. >> no. >> the names i'ming me >> some of the companies you follow that are in dire straits, one does does not a savior make. >> i gave you a jack nicholson line and you missed it. >> i missed it. >> forget it it's rates. >> that was a tough one >> give me something more

mainstream. >> it wasn't even -- you couldn't get that one. you have to be a will be little more on -- i think that -- >> i stunned him - >> the viewers are stunned how about tonight? >> dexcom is a company that i said maybe this -- we've seen the height of glp, the height of the mainnia of glp where people weren't going to do anything other than be saved. no you still have to pick your finger look at williams-sonoma. people are taking home depot as a call, people are stepping up and making their homes better. williams-sonoma. laura albert doing a great job. >> you'll have a lot to work with. >> so exciting i think it's such an exciting day. jay powell day it's charity day, and it jay powell. >> world diabetes day. >> and jay powell day. >> we'll see you tonight, jim. "mad money." 6:00 p.m. eastern. dow up 450 now s&p, two mthon high.

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good tuesday morning welcome to another hour of

"squawk on the street. i'm sara eisen with carl quintanilla and david faber, live for you as always from post nine of the new york stock exchange take a look at stocks post inflation report celebration here for the s&p 500, up 1.75% look at the nasdaq, zooming 2.2% quite a reaction here. the dow is up 470 points you've got every sector higher right now. the leaders, well, most sensitive to lower interest rates. real estate is at the top of the group. it's up 4.25% right now as a sector consumer discretionary up 3.25%. outsized gains utilities, materials, it's a lot of the sectors that have been slammed by the move up in rates. we're wiping out the selloff we saw in october for treasuries. the yield on the 10-year and you will see what i'm talking about. 4.461% remember at the highs we were above 10% on the 10-year the 2-year loving sharply lower, sensitive to fed policy

expectation. the feeling here, fed doesn't have to do more rate hikes 30 minutes into the trading session. here are three movers we're watching nvidia trying to continue its longest winning streak in seven years. now within inches of another all-time high. more on whether the gains can continue ahead of earnings later this hour. home depot, higher as well results there beating system those sales fell 3% over last year guidance a little bit light. we'll have more color from the conference call in just a moment shares of ev maker fisker are slumping down double digits after the company reported wider than expected losses, fewer delivers, cutting its production guidance for the full year, down almost 14.5% guys, the big market mover of the day cpi. the inflation report it's been a while since we've had a market move like this on the back of more benign inflation, which just tells you that market was sort of a little nervous that things were looking sticky and stubborn, and the trend is our friend here when it comes to the market and the fed

and the friend is lower inflation. flat month over month prices core the fed takes out volatile food and energy, up 2% year over year down to 4%, which was better than expected, but not necessarily mission accomplished 4% is settling at a level way too high and uncomfortable for the fed. it does, however, lead to this view that fed is okay being on hold this, combined with the weaker jobs report that we saw last month, suggests they probably don't have to do any more rate hikes at the moment. we get one more cpi report before the december 13th fed meeting. it's going to come the day before, during blackout period the market is judging it has enough evidence they won't have to do much more. >> what stood out to you, if anything, in particular from this report? >> i looked at the food numbers because remember when food inflation was really the

culprit. back in -- last august, i think it peaked where we saw 13% higher prices year over year on food prices and you can really see the progress lately in cpi and food at home this is on shelf grocery we're not showing it right now, but basically it has come down to the 2% level. we brought you commentary and color from the package food makers saying that they're done taking the price hikes and things are going to level out. it's come down, and it's come down sharply it tracks the overall numbers. the peak was june 2022 where we were at more than 9% inflation and we're now back, you know, all the way down to the 3% range. that's a good sign for the fed, obviously, for the markets as well. >> eah. >> market is taking it that way. the dollar having the biggest move since january, weaker. >> jim was talking about p&g and quickly moved on to cincinnati and then you.

>> and then me. >> it's the norv rates as well we said this last hour numerous times, the low 4.5 on the 10-year is having an impact on so many industries and companies that rely or are overlevered and rely on debt to fuel their growth or are interest rate sensitive. >> real estate is surging. >> that's why real estate is surging and names that we talk about oftentimes that have significant debt loads and refinancings that come up and they are also up sharply, whether it's a paramount or warner brothers discovery or al tease in my world, overlevered business, really under significant pressure that's the way these algorithms work rates fall to a certain level, look for the names impacted at lower rates. >> the move was so extended on the other side when we saw that october sort of surprise backup in yields, which wrecked the market, wrecked all these rate

sensitive sectors like utilities, for instance, getting a big boost right now because kind of a bond proxy on the other side the only other data point which is also market friendly is a weaker spending number for bank of america credit card numbers the real-time look at how americans are spending it was down 0.5% on the month. this comes ahead of the retail sales report we're going to get, the overall government report tomorrow, but i called out clothing because i thought that was a surprising decline there, down 9.4%. that's year over year. it's still a big number because that number was 4% in september. a big drop i pulled it out because we're in the middle of retailer names and it's going to be a tougher end to the retail quarter if these numbers are correct on spending and you could hear caution in terms of holiday outlooks in terms of the retailers we have home depot and walmart and target next week that's something to watch. overall, lower gas prices helped

fuel that weaker consumer spending, and that's the market is kind of embracing weaker numbers as long as they don't point to recession at this point. >> 2.99 the most common gas price retail in this country the questioning of the argument was the fed is not going to cut or if they do cut something is wrong. i wonder to what degree is that being challenged it's not a cut out of pain, but maybe a cut out of insurance or just a cut out of keeping things less restrictive. >> preventing us from going into a bigger downturn while rates are high and markets under control. markets looking around may of next year for cut, may or june, which i don't know, the fed might have to adjust its language if it wants to keep the higher for longer -- >> that's the challenge. how do you change the language when you are essentially on hold. >> also, they can't say mission accomplished with a core inflation of 4%. market sees the trend and likes

it, but are they going to have to, you know, continue this dance of, you know, higher for longer, we'll do more if necessary. let's ask someone who follows the fed very well. >> i do want to quickly come back to the theme we've talked about a lot, the supply and demand in terms of treasuries and what you can expect in the long-term rates giving how much issuance is coming up for the remained ir of the year and next year as well. >> two factors to watch are demand if there's more demand for treasury yields that's helpful and the interest payments the government has to make become easier. >> without a doubt we don't know where demand will be we're still talking about, what, you know, huge numbers in terms of our issuance. >> yeah. trillions. >> what do we got? >> trillions next year. >> 4.1 trillion, 7.50 bill in q4. >> like 4 trillion almost. a lot of debt to be issued and that's in the backdrop the fed won't acknowledge that,

of course. paul mccauley, former pimco chief economist joins us with his take so paul, is this kind of a game changer report, that the market is treating it >> yes, it is. i think this is a game changer we're having a day of rationale exuberance because the data clearly show what we've been waiting for, for a long time which is a crack in the shelter component. that's been holding the cpi up and the pce up for a long period of time and we finally got a crack in that, a big-time crack, and i think that is a game changer because i think it leads to the fed being comfortable declaring policy is sufficiently restrictive and that's a big deal because it means they're finished tightening and the next move will be an ease the whole debate will be about when on easing, as opposed to

whether or not we're going to get any more hiking. >> you really think they're going to do that first of all, just the -- i'm glad you mentioned shelter it was the downside surprise was hotels, down 2.5% month over month on the shelter still inflationary pressure in rent prices, you know, owners equivalent rent still sticky and stubbornly high there, and overall inflation is not where they need to go. if they say we're sufficiently restricted the market will go to the next cut, financial conditions loosen and flair inflation back up. >> i think it's a remote risk. you actually did see disinflation in home ownership equivalent rent, so that's the reason it's so big. it's been holding things up. so i think the overall constellation of disinflation now should give the fed confidence to say they are

finished doesn't mean they are in hurry to ease. i want it pound the table on that the game has changed they will be pushing back against easing expectations as opposed to threatening us with more tightening. that's the game changer, i think. >> so when is the first cut? >> i knew you were going to ask me that. i don't have a huge quarrel with where the market is priced out in late spring, early summer i think the big issue is they have to have several months of a 2 handle on core inflation it feel comfortable cutting, and i think we will get there now that we've cracked the component we should be able to move -- [ no audio ] as we move forward it's getting to a 2 handle. >> all right got a little shaky there paul, thank you very much.

appreciate your reaction to cpi. the enthusiasm mirrors the market reaction we're seeing paul mccauley with the dow up more than 460 points as we head to break, our road map for the hour, home depot's conference call just wrapping up headlines after the break. >> a look at the semis as nvidia shares continue to rally those shares, by the way, are up 240% since january trading near all-time highs. of course one question that you're all asking, is the stock still a buy? we'll get a deeper dive into today's cpi number, one crucial part of the holiday season, when ntuetrt"on the see coins. dow is up 460.

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home depot beating on the top and bottom lines but investors focused on what some are calling tepid guidance courtney reagan has been listening to the call and joins us with headlines. >> good morning, carl. shares having a big day, best day since last november. rare for home depot on an earnings day one quarter left in the year you make a good point. home depot narrowing its sales and earnings forecast ranges, but the mid-point stays the same that's what's better than expected results this quarter. some are reading that as a bit cautious total comparable store sales did fall more than 3% and that was better than expectations for 3.6% drop. u.s. store sales comp fell 3.5%. this is three quarters of

decline. before that home depot had a negative comp quarter was april 2011 costs did worsen each month of the quarter and on the call, transactions over $1,000 were more than 5% from last year. softer sales in countertops, cabinets, flooring, plumbing, appliances, hardware, paint, those were among the stronger categories stronger pro leading categories included roofing, insulation and power. this morning, quote, the consumer and particularly the homeowner consumer is our customer is healthy, employed, seen income and wealth gains and in years they have excess savings and remain engaged and deferring larger projects an we've seen that through the year i will be speaking more thoroughly next week on monday with home depot ceo ted decker about this quarter, but also looking forward to the holiday season decor has become a really

big part of their offering i don't know if you had room for a 12 foot skeleton outside your house those sold out, david, for halloween for home depot they're leaning in to those categories back to you. >> thank you. let's bring in michael laser, ubs broadline and hardline retail analyst has a buy rating on home depot stock this price target is 380 give us your take on the quarter first off, michael. >> good morning, david and those 12 foot skeletons are pretty scary but our take on the quarter was three fold number one, sales were about as what the market was expecting. indicating that home improvement cycle is normalizing two, home depot's managing effectively its profitability. it's on pace to be 14.1% to 14.2%, that's its operating margin by the end of this year, which is consistent with where it was prior to the pandemic and is probably a level that it can

sustain for the foreseeable future third, this is a stock that's going to have a considerable amount of upside as we get to the other side of the cycle. it's just a levered play on eventual improvement with consumer rates coming down and healthy home improvement spending trends. we like the stock here. >> you know, they seem to be lowering numbers into the quarter. some who said they're beating a lowered bar. they don't -- the commentary is not particularly strong, was it, on the call in terms of where the consumer stands right now? i would like you to weigh in, in terms of the stock is reflecting positive thoughts, but weigh in on that side of things >> so number one, the stock is reflecting the fact that 10-year is under 4.5% right now, and it shows the amount of torque that home improvement and home depot will see as we see rates come

down as far as what's happening with the consumer, the consumer has weakened in the last six weeks despite that, home depot saw a pretty consistent trend throughout the quarter which is encouraging and shows the consumer is still relatively well engaged within home improvement. it's probably best to expect that its normalization cycle of demand being pulled forward, projects being done over the past couple years will persist into the first half of next year especially as the unemployment rate continues to climb and the labor market weakens but one thing to keep in mind, david, is right now existing home sales, which are at trough levels around 4 million units that's on par with where it was in 2008, despite the fact that we have 20 million additional housing units in this country. people will move and that will facilitate home improvement

demand. >> i was going to bring up, the existing home sales in september at the lowest seasonally adjusted annualized rate in 13 years. you took the words out of my mouth. how correlated is the spending at home depot and not an original question, but with numbers like that? >> you know, it's an important question, though housing turnover is critical in certain big ticket categories where there will be some disruption to the residents like flooring, cabinets, countertops. these are projects that are going to be done more likely when someone is moving into or out of a home for now what's happening is consumers are doing smaller projects in lieu of the bigger ticket purchases. they will continue to do that in the short run and then when we see improvement in housing turnover because rates are so high and consumers are locked into rates so low, but eventually that will normalize and home depot will see a nice

lift as that normalization process occurs. >> so is it all just about the macro and where consumers are spending and how they're spending and where mortgage rates are going? is there anything we can point to execution wise separating home depot from a competitor like lowe's. >> home depot is benefitting from share gain. if you look at the category in the most recent quarter it was down 4 to 5% and home depot only comped in the u.s. down 3.5% home depot is taking share and they invested a lot to be able to support share gains and we expect that that's going to continue its pro business was essentially flat in the recent quarter compare that to its biggest competitor more levered to the bigger ticket categories, it's going to have a more difficult report next week, and more earnings volatility with that business as a result of some more challenging top line trends

home depot has -- for how it's managing over the cycle right now. >> michael, thank you. >> thank you, david. >> as we head to break, check out the biggest gainers right now on the s&p 500 this morning. these stocks are flying and they're some of the hardest hit of the year. vf corp up 11.5% don't see news there an activist target down 43% this year boston properties the real estate rally is celebrating these lower interest rates some of the regional banks too think about who has been hardest hit all year long on the back of high rates zi yons bankcorp andeyrp kco among the worst performers we're back after a quick break

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you can't buy great conversations or moments that matter, but you can invest in them. at t. rowe price our strategic investing approach can help you build the future you imagine. t. rowe price, invest with confidence. quite a day for tech nasdaq almost having its best day since april. check out the spider etf, xlk,

an all-time intraday high since going back to the inception back in 1998. >> wow. >> we talked about tech today, but that says it all. >> amazon, microsoft, apple, meta, nvidia, alphabet higher today. watch shares of ferrari as well. the company announcing plans to hire 250 more employees in the new year, along with a new share ownership plan and enhanced bonuses for employees who hold shares at least three years. the news comes as one of the company's classic 1962 racing cars does set a record selling at sotheby's for $51.7 million,million, making it the most expensive automobile from the automaker ever sold at auction it comes ahead of a huge formula 1 race for the company and other teams, ten teams, in las vegas this weekend i will be there from the ground tomorrow for "squawk on the street" ahead of the debut of our documentary, which airs thursday 8:00 p.m. called

"inside track the business of formula 1. it's so exciting and major i'm going to be doing the show from there tomorrow. >> multiple days. >> thursday and friday the only place to be right now. >> saturday and sunday, too, carl. >> no "squawk on the street" then, but there's a lot of race action it's a huge deal for vegas and formula 1 and in general for some of these teams and the companies we cover that have jumped into the sport, sponsoring teams and the sport in general a lot at action. >> think it's the new nfl in terms of marketing prowess >> it's hard to compare directly to nfl, doesn't compare in scale and size to the nfl in the u.s i will tell you at one of the races i attended for the documentary, roger goodell was there, invited by the head of liberty media, did a pep talk, closed-door meeting with the team owners and principals, and so i think there's a little bit

of a playbook that they're ripping from the nfl they do a cost cap now, which is similar to the nfl and i think they're trying to get some of that mentality into formula 1. >> netflix seems to have been very important component, yet they go not equity value here as a result of how much they helped enable the growth of the sport. >> it was a game changer for the sport they signed that deal in 2019, 2020 we locked down and were watching and took off in the united states. you think netflix should have gotten equity? >> they added a great deal of value they didn't have any part of. >> liberty would say we were smart to sign that deal. >> john malone would have figured out a way to get value out of doing that. kind of kidding. it's interesting on race, ferrari's market cap always mazes me. more than gm and ford combined. >> a luxury brand. >> mean time, check out the biggest gainers on the nasdaq today with the s&p 4 points from

4500 it would be the first time we've revisited that level since september. still ahead, a lot more on today's market action, as stocks rally on the back of the bteetr than expected cpi. don't go away.

welcome back to "squawk on the street." i'm bertha coombs with your cnbc news update. security is set up this morning for an afternoon march on washington's national mall that is expected to draw tens of thousands of supporters with israel organizers say they also want to condemn increasing incidents of anti-semitism and call for the release of some 220 people still being held hostage by hamas. the large rally comes as israel's war with hamas now enters its sixth week. the biden administration, meantime has announced a third round of sanctions today against hamas. this latest action focuses on money transfers from iran to

gaza now the white house has said it has not uncovered any information that iran was directly involved in hamas' surprise attack in israel last month that left 1200 people dead there. iceland continues to brace for potential volcanic eruption in the southern part of the country. authorities warn today an eruption will probably happen in a matter of days the small fishing town of grindavik is at risk activity in the region has cracked roads and led to the evacuations of 4,000 people. back over to you, guys carl >> thanks. got a big rally on the back of the cpi print lowest core annual inflation in over a year. dow is up 510 points s&p trying to get back 4500 for the first time since september nasdaq is going to have the best day since july or actually april if it gets above 2.2% and

treasury yields, the 2-year looking at the biggest decline since march. let's bring in commentator mike santoli to talk about, mike, we thought the print might be a little bit troublesome in the other direction because of some of the reformulations of things like health insurance. >> absolutely, carl. the degree of market reaction shows you that was the way that folks were leaning to some degree and, you know, the bond market has essentially had i've seen enough moments and will ing to price out fed rate hikes all together that could change and we could overshoot, but steve liesman noted we have zero product priced in the fed funds future for any additional hikes by the fed. we have the december meeting that's been left live, but we thought coming in theywanted t be done and they thought they had the conditions under which they could be finished at this point and it was a matter of what was priced into equity markets as well, and you're seeing, of course, the laggard groups, the stuff that was not

pricing in a soft landing scenario has bounced the most. unwind of that trade where people were seeking safety in mega cap growth, people have been kind of awing over the washed out russell 2000 chart. we got the s&p back up to september levels, mid-september, the 10-year treasury yield down 4.4, where it was in mid-september. kind of this symmetrical unwind. disinflation was always the key escape route from that sort of macro conundrum, question whether yields would undercut the economy. that's the treadmill we've been on if disinflation is in and we can trust it good news for the economy can be good news for the market at least for now. >> tech and the xlk. nvidia pennies away from an all-time high. is the market going to chase that or look for other things to own if we start to price in

things like price cuts >> days like today show you there's no zero sum game when it comes to these things. lots of things can parsticipate at once. leaders will lead. there is a catch-up trade to be had. you had 90%, last i looked, of nyse volume, is in advancing stocks that's the thing you scrutinize at the end of the day, was this some kind of breakaway upside momentum day it's too early to say we've had some of these that have been head fakes you have the greatest professional for reprising in the parts of the market that have not participated. i don't think we get out of the late cycle psychology entirely we're going to be subject to how is this economy doing? are consumers slowing down what's the job market look like? right now it's spring loaded in terms of the banks and the small caps and the deep cyclicals. >> remember when you told me that interest rates don't matter for stocks >> wait. hold on a second

i have explicitly, sara -- >> whoa. >> said -- >> or yields don't matter. the correlation is not as strong >> that's right. that's right. >> oh, boy. >> i have told you that there is no particular level of yields that corresponds to where the s&p 500 is no particular level. okay. >> we didn't talk level. >> absolutely. intraday basis, of course that always matters, no doubt about it. >> by the way, you get a good test of this, because if you get a follow through seasonal rally in stocks without, you know, bond yields coming down, step for step, we can make our peace with the different yield level remember the s&p traded at this level at late 3% and now here we are the same level. >> the speed and direction we can agree on that. >> we agree on almost everything. >> just saying having a pretty big effect

i love to call you out. >> i know. >> mike santoli. >> nvidia's rally continuing its longest consecutive win streak in seven years one with more analyst forecasting more gains ahead we're back in a moment when you're looking for answers, it's good to have help. because the right information, at the right time, may make all the difference. at humana, we know that's especially true when you're looking for a medicare supplement insurance plan. that's why we're offering "seven things every medicare supplement should have". it's yours free, just for calling the number on your screen. and when you call, a knowledgeable, licensed agent-producer can answer any questions you have and help you choose the plan that's right for you. the call is free, and there's no obligation. you see,

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i'm branch's brother. ooh, drama. corn me dinkles. this is your second chance with your brothers branch. wet willie! ah stop it. i am a grownup. sorry. a wet william. the asian pacific economic cooperation summit kicks off in san francisco ahead of a highly anticipated bilateral meeting with presidents biden and xi jinping tomorrow eamon javers joins us from there with more on what investors need to expect here. >> hey there, sara president biden is set to depart fwhaugp an hour. xi jinping is already in the air. why is this taking place at the apec summit in san francisco instead of at the white house or

beijing? the answer to that according to foreign policy experts we've been talking about, the state of the u.s.-china relationship is so bad right now, that neither leader has the political capital to schedule a full-scale state visit with all the official hoopla honoring the other leader in his own capital for joe biden, that could be seen as cozying up to china and the reverse for xi jinping but there's a sense of urgency to efforts to repair this relationship or at least to put a floor unit so that it doesn't get worse with u.s. forces reporting close encounters with their chinese military rivals in the region, economic tensions at a high point and wars in gaza and ukraine demanding attention from both countries. in the wake of economic slowdowns in china, beijing may be eager to reset market expectations about the direction of the chinese economy so this regularly scheduled apec summit happened to be on the calendar at just the right time and in a city that is a traditional american gateway to the country of china, plus it's well ahead of the taiwanese

presidential election coming up in january of '24 and the u.s. presidential election in november of '24. the chinese side is expected to push biden to make public comments on taiwan and biden will likely be reluctant to say exactly what they want him to say, at least on camera, so this meeting is going to be framed as taking place on the sidelines of the apec summit not a full dress state visit. the leaders of the other asian economies are expected to be both a little annoyed that the biden-xi meeting is happening here which is going to overshadow their own efforts but also expected to be pleased the two global powers are trying to stabilize a relationship that affects every country in the region so what can we expect to see as a result not much officials are trying to lower expectations for major breakthroughs this week, but it does seem possible that a resumption of military-to-military dialogs might be agreed to as well as optimistic language ability climate change and ai. a couple things to watch for here, guys. >> eamon, it strikes me governor

newsom was in china meeting with xi jinping not too long ago. there's been some senate delegations to china as well and i just wonder how that fits into the dynamic here? obviously, we haven't seen a leader-to-leader meeting, president-to-president like this, but no the like the u.s. hasn't been engaging. >> the u.s. has been engaging on a stepped up basis since last year's meeting between xi and biden which took place in november ahead of a year that ended up being rough between china and the united states. of course, we just saw janet yellen wrapping up a meeting with her chinese counterpart in san francisco as well and said that kind of set the stage for the leader-to-leader meeting all of this, you can imagine, is gone over well before hand and prebaked in many ways and we'll get a reveal at the end of the session if it goes well of exactly what they've agreed to again, the expectation here is, you know, not much in terms of formal deliverables. the idea here isto put a floor on this relationship and say it's not going to get any worse

than it is right now carl >> look forward to your coverage this week. eamon javers in san francisco. next guest says dialog is critical, whether there is competition, cooperation or conflict joining us, former under secretary of commerce for economic trade, here at post nine great to see you. >> great to be here. >> to emans point do deliverables matter less >> you know in all candor, a lot of deliverables that came out of meetings when the relationship was on better footing was talking points anyway. what i think is important is we are communicating and we are going to be intense rivals for decades to come, but rivals doesn't mean we must be adversaries and we must find ways to cooperate, and the only way you're going to do that is through the intense diplomacy from leader to leader meetings >> bunch of takes about china being under the gun or xi for direct investments, their percentage of our gdp. does that mean he plays soft

do we leverage that? how do we approach that? >> for sure it's true, their growth is slowing, but still growing faster than we are unemployment is high, especially amongst youth. president xi is meeting with u.s. business leaders to encourage more direct foreign investment in china. they feel economically vulnerable the key issue while they are economically vulnerable, that we don't press them so hard that they lash out, and so we have a lot of interests where we have mutual agendas and it's finding what those interest rates are. >> for business investors is it realistic to think we can have an open and constructive dialog with china on the commercial front on trade and business and confrontational one on the national security front? >> you know, look, i think the business leaders in the united states and the west generally have gotten frustrated, sara, because we've had a lot of lip service of these sorts of

meetings coming out of die aloge that haven't led to concrete deliverables it is a huge market and hugely important and our supply chains are fundamentally interconnected, so we can't have an economic cold war if u.s. businesses and western businesses are going to be successful. >> no matter what's happening with china and russia or china, you know, siding in the israel-hamas war. >> that's a very good example of where we have mutual interests the two catastrophic risks that could exist for the united states economy, it's in and around taiwan and in and around iran if we get into a hot war with iran, prices of oil is going to go up, the delivery of oil will go up, who by the way, gets most of their oil from iran and the persian gulf, of course, it is china. that's a perfect example where we want to use this relationship -- by the way

beijing has a warm relationship with tehran -- to make it clear that if iran gets involved directly or indirectly in the middle east, there are going to be consequences and those consequences, for sure, will be felt by the united states and also be felt by china. >> i mean, the number of -- the amount of direct investment from u.s. business into china is down dramatically. >> 15ish percent. >> the willingness of u.s. companies to try and make an effort there seems to be certainly less than it would have been five, ten years ago. i mean, is there really anything that can reverse that? particularly given xi's own statements when it comes to just private enterprise in general? >> it's hard he's going to try to accomplish both things. he has taken a firmer -- had a much firmer direct hand with state-owned enterprises in his economy on the one hand. on the other hand he needs our technology, he needs our cooperation to continue to grow the economy at the center of the bargain that chinese communist

party has with the chinese people we are going to run your government and the quid pro quo of that is we're going to continue to increase prosperity in china, and he knows that he cannot do that without the west and the united states. >> you think things get stabilized to use a phrase eamon used there? >> i think it has to, because the other choice is a bad one for both sides. >> it's going to be a consequential week look forward to what happens out west. >> thanks for having me. >> coming up next hour, deep dive with the ceoof wynn what he's seeing when it comes to the consumer. remember they have earnings last week plus expectations ahead of the blockbuster formula 1 event in vegas. that's coming up ithe xtn ne hour on "squawk on the street. don't go anywhere.

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that one with mizuho analyst it's good to have you. what's cause this runup into today? is it expectations of earnings >> thanks for having me on absolutely, earnings next week and a.i. could be a massive tailwind for nvidia and with the spend on hyperscalers and cloud moving to a.i., that's been a pretty strong tailwind for nvidia their a.i. grew year-on-year so spig growth. >> what's been happening with your estimates isn't this also when we'll see an impact from the biden administration restrictions on advanced computing shipments >> yeah, definitely the biden restrictions started today, but we don't see a change in that. that's a demand overall in a.i. continues to be very strong. we think nvidia has noted the

restrictions should have little impact on the guide in the near term as you look at the january quarter coming up as well, we think expectations are fairly low on the speed so, there should be pretty good upside to those numbers looking out as well. >> you think there will be upside it's not a surprise to anybody that this is at the center of the growth of a.i. i just wonder from a valuation perspective why you're arguing there's more upside? >> i think if you look at the a.i., especially data center, that's growing at 300% year-on-year clip. that's massive if you look at a.i., that's 10%, 15% of revenues in the last two years to almost 80% of revenues now. if you look at i.t. spending at all the cloud guys and hyperscalers, it's skewing from hyperscaling compute to a.i. that trend continues to be intact that will continue in 2024 as

well we see that as a tailwind for nvidia, as they tip the spear on a.i. performance. >> no real challenges to speak of obviously, amd will have a chip that will power certain forms of generative a.i is there any point at which we start to say, wait a second, you have to pull back on that multiple because there's real competition? >> let's look at the numbers 2024 nvidia, a.i. is in the neighborhood of 80 to 60 billion if you look at the consensus if you compare that to amd, amd has talked about $2 billion for 2024 they probably have upside to that when you compare $2 billion to $80 billion with nvidia, that's a massive gap. >> thank you for joining us on nvidia, which is up a whopping 240% year-to-date. best performer on the s&p 500. meta and royal caribbean behind

it. speaking of a.i. opportunities in the next hour of "squawk on the street" we'll talk to the head of sequoia, the legendary venture capital fund where they're placing their bets as they pull back on crypto expose exexpoe exexposure. >> there are key questions where they're marking things, which may have bottomed but certainly have not soared in any way we haven't been talking much about the ipo market of late either. >> what happened there rates went up. now they're coming down. maybe ipos will come back. >> one thing that's certainly coming back is a lot of companies whose stocks have been depressed in part because they have balance sheets heavy with either floating rate date and/or new refinancings coming their way, as you take a look at the ipo. as with weave talked about during the course of the show this morning, anything interest

rate sensitive, whether utilities or reits they are up sharply and back to what i just mentioned as well, those companies that have significant debt loads or rely on the debt markets in part to not even fuel growth, just to keep themselves above water, so to speak all beneficiaries of the significant rally today that comes off the idea that the, as paul mccauley said, is done. >> done. no expectations for the rate hike in the market for the fed we look to when the first cut is it's happening in the dollar as well we're seeing a more than 1% move weaker on the u.s. dollar, which is a pretty big move in currency land we haven't seen that in several months another pressure point being alleviated for some of the companies that have complained about the strong dollar cutting into earnings. that's going to help the multinationals as well we'll see what the fed has to say about this weaker data and inflation. >> when are we going - >> november 15th

there will be fed speak before then. >> will we have a chance to get 5% on the 10-year? come on, sara, give me an answer. >> the market is not suggesting the market is no right now in this cycle look, they don't ring a bell when they're done but the market is anticipating that they want it to be done anyway they were leaning towards that and now they get further proof core inflation is still at 4%. they want it at 2. >> the s&p up 2% and the nasdaq up 2.25% we have a lot more coverage of this significant rally in those equity markets on "squawk on the street," which continues right after this

in a crisis caused by a terrorist massacre. warning civilians to clear out, while hamas forces them back. allowing in food and water, which hamas steals.

good tuesday morning welcome to another hour of "squawk on the street. i'm carl quintanilla with sara eisen live at post 9 of new york stock exchange markets rallying on this lower than expected data inflation what that means for the fed and the outlook for rates. former fed official vincent reinhart is with us. how are rates impacting the vc landscape sequoia will help answer that question. and running whipsaws after