your time on earth here was well done. that's all for this edition of "dateline." i'm craig melvin. thank you for watching. [music playing] very good morning, everyone, welcome to street signs. i'm sylvia. here are your headlines. european equities and bonds slugging off tuesday's pullback on wall street, where strong data is clouding the feds rate cutting trajectory with attention turning to december's minutes. samsung's profits point, but shares move higher as nvidi

a ceo said they are confident to deliver chips for new ai systems. social media giant meta announces the end of the fact checking program. saying it's a move to free expression. a step they welcomed. >> think about it as this global, collective consciousness, keeping each other accountable at global scale in real time. we say, mark meta, welcome to the party. >> and wild fires ravage southern california, forcing 30,000 people to evacuate their homes. the governor declaring a state of emergency. good morning, everyone, we start today's show looking at the action on the european

continent. we have the stocks above the flat line, really, but nonetheless, an important move, because it shows a little bit of resilience compared to what happened on wall street yesterday. we had quite a weak session overall. particular attention on the tech sector. let me show you how the different areas in europe are moving as well, so we get a better idea of what's happening. we have a mix picture. we have the extra tax, the main market in positive territory. however, a little bit of pressure for french equities. i would like to highlight the moves over in germany. we have the market in positive territory and this is actually despite weak data out of germany earlier today. in terms of the sectorial breakdown, this is it. starting with the best performing sectors. financial sectors, we witnessed

yesterday, at the moment, we're up about .9. banking stocks also performing up about similar levels. up about .8. let me show you the worst performing sectors. we have oil and gas as the worst performing sector for the time being, and this is actually despite the changes in oil prices that we are witnessing as well today. utilities tracking lower, about .8. it's disputing with oil and gas to see which one is the worst performing sector at the moment. overall, i want to take you to the bond market, too, because there's a couple of interesting moves happening in that space as well. we have seen the benchmark. let's look at the yield. we are slightly up at the moment. we are moving at 2.488%. we have seen basically a little bit of a pull back from the recent highs on the benchmark,

on the ten year yield. all in all, i would like to compare that with what is happening in the united states as well. before we get there, though, i want to show you the moves over in uk that also are interesting. long-term costs hit their highest level since 1998 on tuesday. the yield on the 30 year gilt climbed toward 5.3%. the 20 year also jumped. the jump highlights investors concerns over pressures in had the uk. fiscal plans, and the general uptick in global inflation with the dawn of donald trump's second term in the white house now approaching. let's get a check on u.s. futures, too, so we get a better idea on what will happen state side. it could be a positive start to the trading day on wall street. this despite the weak session we witnessed yesterday, just to give you an idea, we had the

nasdaq down 1.9%. the s and p also finished a day lower by about 1.1%. and indeed, a lot of that had to do with the moves in the tech space. and i want to tell you why. we actually saw u.s. stocks and treasuries selling off on tuesday after better than expected service sector activity and jobs data as well. while on going concerns over tariffs cloud the trajectory of the feds rate cutting pathway. the ism services index rose better than expected. two percentage points. representing the share of businesses expecting growth. now the measure of prices surge more than six points to 64.4%. now, in addition to that, u.s. job openings hit a six month high in november, according to the latest survey. available positions rose to 8.1 million, well ahead of estimates. so let me show you indeed how we fair at the end of tuesday's

session. i had already hinted to some of the numbers and weakness overall. but indeed, i you would like to mention it was tech that led to the downside in terms of sectorial losses. it was the worst performing sector on tuesday. before i take you to the bond market, here's also a couple of interesting moves. we saw yields moving higher across the board. let me share the move on the benchmark. we actually saw the ten-year yield hitting an eight month high on tuesday. all of this because investors are wondering at this stage whether we're going to get those rate cuts from the fed and in particular, if that will happen any time soon. markets will be on watch today for december. the fed by 25 basis points last month, but revised outlook for 2025 to just two cuts, with the chairman, jerome powell, saying the central bank will be cautious on any future reductions while inflation has

been quote, moving sideways. now, to put it all into context, let's discuss all of this with our next guest, head of research. great to have you on the show. >> thanks. >> i would like to first get your thoughts on this latest data that we obtained in the united states. are you also of the camp that the figures are quite concerning in terms of what they mean for potential rate cuts from the fed? >> i think the big challenge you have is we have this friendly macro backdrop in the last two years where you had good growth with inflation falling. with inflation not falling anymore, possibly rising, and i think this new medium we need to find, it's more important for the bond market and the bond market as often is the case, is potentially over

shooting. we certainly think so. we think the market is pricing for the first half of next year, for the whole year, and you have to consider that they are still very reactive in case something goes wrong. to price less than two cuts, close to only one cut for all of next year, is essentially mainly the insurance, like the probability that something goes wrong. sometimes the reaction that the fed might have. so i think we are worried in the sense that the market is pushing this theme of less inflation normalization down, quite far, and possibly putting too much probability on fed hikes. if that's the case, if the market really worries and the fed potentially continues fueling that worry that you might get hikes. that's a big worry for the market. we could see bond yields continue to push higher and i think in particular, the concern is the back end, because the back end is to some

extent, finding equal librium, no one is comfortable. you go a lot with recent experience. so, the longer the front end rates are higher, the longer the front end rates continue rising, the more you need to put up that neutral rate. that's the process currently. >> it's interesting, even discussing the possibility of a hike seems to some extent a little farfetched, because it is such a change in narrative for the fed. but i would like to understand from you as well, to put all into context. we started with markets reacting to the news from the washington post, perhaps trump was going to get a softer approach on trade tariffs. that could be a positive if you think about inflation dynamics, too. so how are you looking at those comments, how you are pricing in fed moves this year? >> i think the market definitely wants to have certainty. there's a good chance we won't get it for some time. this kind of noise and this back and forth, which we're

seeing this week, is something that could linger at least until the inauguration, if not longer than that. so, our worry is that markets can easily test the extremes in both directions. currently, it's testing towards the end of the week, again, the negative extreme. our baseline is pretty constructive. we think there will be a 20% average tariff on china. a few selective tariffs. but you come out fine. i agree with you to the statements we got overnight, are certainly pointing towards a bit more of an aggressive approach, and it's very difficult always to dediscriminate between policy shifts and escalate to deescalate strategy. in the past, policymaking has been done. >> talk to us about asset allocation, given all of this uncertainty. what is the right approach this year? we saw a risk, is it likely to continue? >> i think to us, this year is

going to be more bout diversification. i think diversification across and within assets. we've been shifting slowly back to a standard 60/40 portfolio. it worked well, but it has been because equities gone up. bonds haven't contributed much. but we are in the middle of the process of, like the fed is now much more priced, the term premium has rebuild. bonds will play more of a role. we're over equities and bonds and trying to find the balance. we are tilted more towards the european bonds, because you have less pressures, which we discussed earlier. you don't have the prices picking up there, possibly because of tariffs feeding into these expectations. you don't have the strength and reacceleration of the economy. so i think we prefear european duration. within the equity market, we were very focused on diversity from the big winners of last

year. it's tough, because they have been winning for such a long time, but we do need to acknowledge that the magnificent seven and the u.s. equity market added further to the evaluations last year, and we need to consider that this is partially because of the super friendly, what i described earlier, falling inflation momentum, the magnificent seven, so we are quite worried about what rising inflation and possibly rising yields might mean for some of the most expensive parts of the equity market. the last day or two, illustrating, if the rates market continues to sell off. >> so many things i want to ask you. let's start in terms of european duration. any sort of particular parts of european market that you would highlight? particularly when we are saying, a little bit of higher yields across the board at the moment? >> you mentioned it earlier, the uk is interesting.

you have in the back end, enormously high yields, relative to what a lot of people would say is equal librium. it should be based on a solo growth model. something like a real yield plus an inflation expectation. most people argue that we know why that is. we know there's a certain fiscal concern. we know there's a certain supply dimension. but i think, especially if you see trump going ahead with tariffs, especially if you see global growth suffering because of that, i think uk -- even if the uk is more services driven and more directly exposed to trade tariffs, it is very exposed to the euro area. we would expect uk duration could be interesting diversifier this year. >> going back to stock, i

notice you are talking about european equities. when you highlighted to me how expensive some u.s. stocks were, and could you also share some thoughts in terms of the european tech space, what are you thinking there? >> i think it's a good question. we've been underway european equities for most of q4, if not under performed significantly. it's hard to find anyone who is bullish on europe. that tells you that you need to be careful. i think the reason why, it's been very much linked to the risk of trade tariffs. it's been very much linked to some extent, policy vacuum, where i think both the ecb is constrained by services inflation. as you get closer to the german elections. as you get closer to the french elections, there might be a bit

more policy, and we want to be very careful going into that. our economists remain skeptical that europe manages to generate a huge policy response, that will allow it to come seek growth accelerate material. there's no rush. so we are, at this point, watching very carefully. it's been working. it's been working a bit too well. it clearly could mean that europe does out perform a bit, less because of europe and things going well, more because the u.s. doing a bit poorly, because of higher rates. it's not a good narrative to necessarily by europe. it's narrative to trim the u.s., the equity risk, that's what we've been recommending. >> i want to say on europe, before we discuss this in detail, i want to share breaking news. the former foreign minister is

becoming the interim austrian chancellor. schallenberg has been in politics for a long time. i had a chance to interview him several times myself. he is taking on this role as caretaker, chancellor, obviously of the back of the collapse of the government there. we could be seeing a government in austria that is further to the right of the political spectrum. let's see how these will develop. nonetheless, an important development here given the experience that alexander schallenberg gives to the table. what i would like to understand is you were talking about the fact that we're going to have an election in germany. the outlook here is also quite interesting from a fiscal position, because if we see germany actually changing any sort of rules regarding the debt break, do you think that could spark a conversation across the blog in terms of how to position their fiscal policies in a way that address

their economic pressures? because it seems that for the longest time, and we heard from him himself, the politicians are not delivering on these actions and even the ecb has commented on that as well. what is the outlook for fiscal policy here? >> yeah, it is absolutely right. i think european fiscal policy has been very reactive. reactive to crisis, and the same with germany. germany is in a crisis, and that's why it's most pressing over there to rethink fiscal policy, to rethink economic policy broadly, and that's why we are very focused on germany. also, they do have that break, which is enshrined in the constitution. we think germany is the one that has the most potential, and surprise relative to what they wear, and not expectations, a lot of my clients expect some tweak to the debt break. i think the rest of the area is trickier, because france obviously is having a different dimension of problems in terms

of longer term debt stability, and doesn't look that worry ing, they are doing well on the growth side. growth is a key input into fiscal stainability. the rethink would be gradual and for us, it's mainly about germany. we don't think there's a major fiscal response coming out of europe and sadly, because you are absolutely right, i think the report outlined a path for europe, but i think that seems less likely. >> well, let's see what they will do. we appreciate your time. head of asset allocation research at goldman sachs. coming up, we'll get the latest adp private sector jobs later today. our colleagues will be speaking to the adp chief economist, nela richardson. and we'll be hearing from

u.s. treasury secretary, janet yellen today. you can tune in later on at 4:10gmt. comments have nvidia ceo, while meta takes another step to boost ties with president- elect trump. we'll bring you the details after this break. ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com. (auctioneer) let's start the bidding at 5 million dollars. (man) robinhood gold members get a 3% ira match.

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welcome back to the show. now some says it expects to miss forecasts on the top and bottom line in the fourth quarter. the chip maker guided for operating profit of 6.5 trillion in the period. but shares are moving higher today after nvidia ceo told a press briefing he believes the company will redesign the high

band width memory chips to meet san cards for new standards. the message from samsung was, because looking at the price reaction, perhaps investors ignoring a little bit of the fact they are missing their guidance. >> the guidance is the side story here. this is all about the circled high band width memory. now, samsung share price took a really big hit last year because of the fact that they were falling behind their long- term rival, in this area of high band width. we know about memory. you find it in your laptop and other consumer electronics devices. memory is multiple memory chips stacked on top of each other, which allows the quick transfer of data. that is obviously very, very important when we are talking about ai training applications. nvidia buys these and integrates them into the server

chip sets. that's why hbm is so important. the key to their own technology. they are only buying the bulk of it from sk hynix. samsung has not been certified for use. so they said well, we will certify samsung, but they need to redesign their high band width memory in order to meet our requirements for our chips. and he is urging samsung to do so. the reason we saw the share price jump, is because he said he's very confident that samsung will be able to do so. i spoke to a number of analysts about this story, and they said one of the issues samsung had was it was late to the party. it didn't invest enough early enough and that's why it fell behind sk hynix. investing highly to bring a product to market that is fit for nvidia. a lot of the share price performance this year as well

as financial performance will hinge a lot on nvidia and if nvidia is able to certify samsung high band width memory. we know samsung makes everything from smart phones and fridges through at advanced memory chips. actually, when you look at the profit, the profitability of the company, the bulk of that comes from the chip division, and that is the sales of memory chips. if that is falling and that is under pressure, that is putting samsung's broader financial performance under pressure as well. >> i want to understand whether there's a common thread here. the indexes were showing how some premarket moves for companies that basically have deals with nvidia, were moving high. i think at one point, up by more than 50%. at the same time, we also saw quantum stocks down yesterday, so, how important is comments

from jen son for the whole tech sector at this stage? is this the driver for whatever other companies do going forward? >> the market is really hanging on almost to every word that he says. every time there's a schedule for him to speak, the markets on edge, what is he going to say? i think, you know, the ces announcement from nvidia was fascinating. there were interesting things that nvidia announced. the shares dropped on the back of it. it's almost as if the market wants to hear something ground breaking every time. nvidia's commentary was really, really interesting and layed out a vision from the company, where wong was saying, we're way more than ai chips. software, robotics, and layed out one of the most interest things. the platform they announced. it it's a software platform and

effectively, it is a set of ai models that are able to generate videos. they can generate synthetic data. that data is not always available. so there's this thinking within ai right now that if you can generate synthetic data based on real world experiences, you can fill in the gaps in data sets and if you take this one step further, you can use those data sets to train things like robotics kh-rbgs ordinarily would need huge amounts of real world data that might not necessarily always be available. that was a huge announcement from nvidia as well. you extend that as well. he thinks autonomous vehicles could be the first trillion dollar robotics. it has the training systems for ai. it has the synthetic data platform i just mentioned, it also has the computer system in

the car as well. all those things, you saw was positioning nvidia beyond the story it was over the last two years and saying is hey, yes, we're big in data center. yes, we're big in ai training. our future is way bigger than that. at this point, many might think that's a long way off yet. perhaps there was negative share price reaction. actually, you are seeing right now, laying the ground work for an nvidia story that moves beyond the data center. >> analysts will all appreciate that. the forward looking and also let's not forget there's definitely a lot of reasons based on what you just highlighted for everyone, for every investor to be like, what is nvidia's ceo saying right now? we'll see what else the company will do. in the meantime, i want to take you to meta. they announced they are scrapping their third party fact checking processes to restore free expression and

build community notes model similar to elon musk's x. mark zuckerberg said the company is easing restrictions and bringing back political content in an effort to smooth relations with incoming president, donald trump. it takes note of meta's announcement and compliance with the digital services act. coming up on the show, the u.s. president-elect, donald trump, we'll bring you the latest after this break. the future of cool, comfortable sleep is here. introducing the new sleep number climate cool smart bed. the only smart bed in the world that actively cools and effortlessly adjusts to both of you. sleep up to 15 degrees cooler on each side. it actively cools by drawing warm air away from your body, to keep you cool and comfortable throughout the night. our smart sleepers get 28 minutes more restful sleep per night. it's our lowest price of the season on our most popular smart bed.

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welcome to street signs, here are your headlines. european equities perk up in early trades slugging off the pull back on wall street. strong data is clouding the fed

rating trajectory with attention turning to december's minutes. samsung profit estimates disappoint. shares move higher as nvidia ceo says he is confident the south korean firm can deliver chips for new ai systems. the social media giant, meta announces the end of the third party check fact checking. linda welcomed. >> think about it as this global, collective consciousness, keeping each other accountable at global scale in real time. we say, mark meta, welcome to the party. wild fires ravage southern california forcing 30,000 people to evacuate their homes. the governor declaring a state of emergency.

now european equities has been trading for over an hour and a half. this is what we have at the moment. the benchmark, the stocks are up .2 indeed, marking a different narrative than what we noticed on watt street. concerns were putting pressure on u.s. stocks and indeed, leading to a selloff also in the treasury market. but let's look at the european portions so we get a better idea of what is happening on the european continent this morning. despite the weak numbers that we obtained from berlin this morning, in terms of industrial orders, they were down 5.4% month on the month in november, and indeed, despite that, we are seeing the main market up at the moment. in terms of u.s. futures, it's

how we're shaping up ahead of the open on wall street. they suggest it could be a positive start to the trading day state side. despite the negative picture on wall street on tuesday, where we had the nasdaq down 1.9%. the s and p also down 1.1%. now, in terms of u.s. politics, the president-elect donald trump, the properties founder who is building data centers in the u.s. the billionaire could add to that investment over time while he suggested the move had been prompted by the election. and our very own filed this report. >> the friendship between donald trump and hussain spends more than a decade. these two men share a love of real estate, a love of business, and a love of branding that has drawn them

together sometimes controversially in a partnership that dates all the way back to 2013. that's when damac properties entered into a licensing deal to a trump branded golf course in dubai. the second of which is under construction. he is now expanding his business to the united states, with an initial $20 billion investment targeting the midwest and sun belt states. >> for the last four years, we've been waiting for this moment, and we're planning to invest $20 billion and even more than that if the opportunity in the market allow us, but at the moment, we are planning $20 billion in data center catering for the ai and cloud business for the hyper scalers. >> the deal reflects his influence as a key player in middle east business. it also reflects trump's unique ability to leverage foreign friendships to drive foreign

investments into the united states, raising criticism about the financial intermingling between trump's friends, their businesses, and the government. dan murphy, cnbc. elsewhere, president-elect donald trump refuses to rule out using economic action to take control of the panama canal and greenland, describing both as critical to american economic security. his commends expand on part of sweeping remarks about seizing more territory during his second term. the french foreign minister responded this morning saying you won't let other nations attack its border while denmark's prime minister said the territory is not for sale. we're entering a uniquely dangerous phase of history in 2025, with the risks from the g- zero, donald trump, and break down in u.s., china relations. it flags the top risks for 2025.

and i'm pleased to say, senior analyst for europe at eurasia group is joining us, there's a lot happening on the geopolitical scene. before we take a look at some of the dynamics, i would like to get your thoughts on your comments on donald trump using military or economic measures to seize the panama canal or greenland. what do you make of this? how likely is that? should we be concerned? >> i think it's a first taste of what we will get over the next few years. those that thought the look of trump 2.0, thinking it would be disruptive, but manageable, may be mistaken. it is quite a serious issue. it's easy to miss it as something of a gimmick. greenland is full of natural resources. it's key for the arctic. any interference could open up for russia and china to

interfere. watch closely in the coming months for sure. >> and where that lives the european union versus the u.s., because obviously, with donald trump coming in, there's more pressure on european countries to spend more on defense. they are trying to get the u.s. to keep some sort of support for ukraine going forward. but now these comments around greenland, how do you look at the transatlantic relationship going forward? >> i think europe, alongside china is probably one or two row johns that has the most to lose. we are cautiously optimistic about the prospect of a cease- fire in ukraine this year, which is certainly good news. but this doesn't mean that even if there is a cease-fire, that there would be a peace agreement. i think most parties in the conflict have an interesting scene, russia included. although putin would be hard to sell. a peace agreement remains out

of reach. we're actually, you know, european defense, than many other observers. the return of trump will serve as a shock to the system that will serve to focus minds in brussels. i think the prospects of an increase in defense spending are somewhat under appreciated at the moment. but this doesn't change the fact that even in the event of a cease-fire, you know, with a weakening u.s. commitment to european security, europe's security architecture will remain worse off than it was before. the spoiler going forward, and continuous activities to attack nato on a number of fronts. >> exactly on this topic, we have the european stocks on the screen at the moment. we are seeing them moving higher today because one of the narratives is we're seeing more spending going forward as a

result of the reelection of donald trump. but i would like to focus on russia for a moment. in the top risks for 2025, one of the events that you've highlighted is russian influence in changing the global, geopolitical order, really. how do you characterize that going forward, particularly when we know that's not necessarily new, but perhaps it is becoming a little bit more effective, if i think about the election in romania and what happened there. guide us through your thoughts in terms of russia influencing the political order going forward. >> the over arching report of the report is what we like to say, a way to describe the political shift away from a u.s. led multilateral, order toward the law of the jungle, as it were. taking responsibility for upholding global norms. this is over simplification.

the system wasn't perfect before, and elements of the international system will remain in place. still, is this a recipe for stability, for economic dislocation, and for conflict. and, you know, this has a lot to do with trump. but we think of trump as a symptom rather than an agent. the roots go much deeper. i would point to better integrate russia into the west after the cold war. where does this leave us today? prospects for a cease-fire are good. no peace agreement, which will require former recognition of russian territory in ukraine, in exchange for security guarantees on the part of either nato or the u.s., which the u.s. is unwilling to provide. and russia is actually unwilling to accept. this means that you know, halt to the fighting, but one that

might be weak, unstable, short lived, and relations remaining bad. no sanctions being lifted and russia using means such as election interference to interfere with nato countries. >> speaking about influence and perhaps political interference to some extent, how are you reading the comments from elon musk regarding germany, regarding the uk, is that also a risk that you would highlight for 2025? seeing players like this case, massive ceo really, making his comments very clear on other countries politics. >> yeah. >> it's a different kind of influence. should we ignore it? >> absolutely not. i think it's very concerning, actually, and if it were happening anywhere else in the world, in india, for example, if the president were to bring the ceo and the richest man in the country along to meetings and phone calls with other world leaders, i think that would be seen as an indication

that the country is -- an indication of corruption. also huge implications for foreign policy as well. ultimately, musk has his commercial interests in mind, which may con side with european foreign policy. those leaders and close to him, who visited trump over the weekend, is close to musk, i think will have a difficult time navigating that balancing act going forward. >> let's see what will happen. no doubt, a very busy 2025 ahead. despite the fact that last year was the year of the elections, a lot to monitor on the political scene. senior analyst for europe at eurasia group. i want to take you to live pictures from california, this as we're keeping a close eye on ot wild fires in los angeles.

violent wind storm actually has fueled fires in los angeles, where tens and thousands of people have been ordered to evacuate. almost 3,000 acres of the pacific palisades area have burned: now coming up on the show, we'll look at what to expect from today's fed minutes with investors looking for signals on the central bank's rate path. we'll have more after this break. and we'll take a look at europe's best performing, in our upcoming cnbc pro segment. you won't want to miss that. we'll be right back.

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welcome back to the show.

now the s and p500 closed the year with annual gains of 20%. that was for the second year running. but a small handful of etfs in europe were able to out perform and produce even better returns. our very own from our cnbc pro team is joining us with more. you have been looking at these etfs, tell us what you learned with this exercise. >> yes, i mean, the stock markets produced fantastic returns over the past couple of years. the s & p 500 was up 24% in 2023 and last year, 23%. that's a very rare thing for the stock market to be doing. it's only done this three times this century, so given that backdrop, it is incredibly different for active managers to out perform the market. now i've looked through the numbers and found a handful of et fs listed in europe that are

actively managed. the jp morgan u.s. research, that has gone up 30% last year. that's about 6%age points more than the s & p 500. the other etf that managed to miss out on the top spot was the invesco, that has gone up 29.9% last year. now, all of these etfs have one thing in common. they are invested in global equities, mostly in the united states, but other parts of the world as well. so they all have dollar based assets in them. and the fact that the dollar was strong all of last year compared to the euro, helped push up these etfs partly. >> i am curious behind the strategies behind these positions for these particular etfs, did you find any sort of particular tragedy that actually stood out and benefited these etfs? >> the jp morgan is entrusting.

they bring together active and passive investment management stocks together. jp morgan modifies that ever so slightly. what they told me in the past, they build a portfolio by taking all the stocks in the index, just tweaking their weights ever so slightly. jp morgan, when they are bullish about a particular stock or stock in the portfolio, if they are not so bullish about a particular stock, it is under weighted in the portfolio. that strategy has done really well for them over the past few years. it out performed in 2024, but consistently profitable for them over many years. >> is that unique to them? or have you found other investment managers taking similar approaches here? >> if you are producing such fantastic returns, competitors are going to keep a close eye on how you're doing this.

and you have a number of competitors putting out very similar funds that are available now, the fertility sustainable research and u.s. equity, that was up 6% last year. so that's a very similar offering by fidelity, based on how they feel about particular equities. >> right, very interesting research. of course, you can read genesh's full analysis on our premium service. now, as we approach the end of the show, here are the four things to get you up to speed ahead of the open on wall street. u.s. markets are in focus after inflation concerns drove yields higher on tuesday. elsewhere, palantir stock is in the spotlight after being yesterday's worst performer on the s & p 500. investors are now looking ahead to the private payrolls report as well, and jobless claims figures. and markets will be on watch today for the december fed

minutes. speaking of which, the fed, 25 basis points last month, but revised their outlook for 2025, two cuts. the chairman saying the central bank will be cautious on any future reductions while inflation has been quote, moving sideways. to discuss this in more detail, we have the director of currency strategy. good to see you, david, first and foremost, i would like to get your thoughts on the outlook for fed moves in 2025. it seems the investors are wondering whether the latest inflation prints are suggesting that we could see the fed, perhaps cutting less than what they had suggested. what are you pricing in? >> well, yeah, i think that is pretty much what everybody is looking at. inflation seems to be stronger than what everybody has expected, and so the rate cuts we were hoping for at the end of last year, it looks like

they will be pushed back to maybe june or july of this year. right now, it is pretty hard for the fed to really cut interest rates because we have inflation going. and really, the only thing they have to control that is to try and increase interest rates, which nobody wants right now, which will be a big drain on the economy. we're in a transition their period. ary period. with donald trump coming in, in the next few days, but we've also got a lot of, you know, transition with what's going on in the economy. so, things are really up in the air. it's going to be interesting. >> no doubt, and this is why we love what we do so much. what i would like to understand is why is the timing such a concern? if we see the fed delivering on those two rate cuts they had

suggested, why does it matter why investors now are thinking that our rate cut will come in june or july time? >> well, i mean, if we cut today and the interest rates are lowered right now, that's going to exacerbate the inflation that we've got. and that would be really detrimental to the economy. americans and people worldwide really are really struggling with inflation in general right now. and that is really retarding the growth that we would like to see in the world economy, and making it so it is more difficult. if you reduce those interest rates prematurely, it could really adversely impact what is going on in the conomy. this is always a timing thing, and a lot of people were really skeptical that the fed took so long to reduce interest rates, and it is turning out that it was probably about the right

timing to do that and i think holding off for a little while is a prudent move right now. >> what do you make of the growing narrative, considering whether the fed will have to hike before the end of the year? >> i don't know about that. i think what we've really got to wait and see is what happens with the trump administration. there is a lot of rhetoric about tariffs and about how different countries are working together. we've seen a lot of political turmoil. we saw canadian prime minister resign, and we've seen political upheavals in south korea and in france, and you know, in austria and there's a lot of different things going on in the world right now. all of these dynamics play into that. when i look at the currency markets, i see a lot of u.s. dollar strength. we saw some temporary

weaknesses on monday this week with some rumors that trump's tariffs might not be as nearly as deep as we originally thought. he corrected people on that and so that brought the dollar back up. so you know, when we look at the markets, we have to look at everything going on, not just interest rates in and of themselves. we have to look at all the different aspects that are going into the whole market. >> naturally. speaking of that, i want to get your thoughts on the fiscal position, because we actually heard from a warning about the u.s. debt ceiling conversations and whether we might see a stalemate over the coming months. what do you make of the fiscal position for the united states? do you think at one point, this is going to raise alarm bells for the investment community? >> well, i mean, this has been a conversation that we've had for 40 or 50 years. it is always a conversation

when it comes to budget times and you know, when you have people on different sides of the political spectrum, there's always going to be disagreements on it. what i would like to have the u.s. debt lower? absolutelyi would. at the same time, the economy is working, and you know, business is doing well. so i don't think that it is going to be an issue long-term. it is one of those short-term political issues that will work itself out in the end. >> well, i guess we'll find out. in the meantime, we appreciate your time this morning, director of currency strategy. before we let you go, a final look to european markets, how we're moving this wednesday morning. we have basically a mixed picture for the european. however, in germany, we have the main market up .3, despite weak economic data earlier today. and u.s. futures, this is how we're shaping up ahead of the

open. they suggest it could be a mosstive start to the trading day statewide, despite the weaker perform we witnessed on tuesday with tphraáz dark down 1.9%. s and p down 1.1%. with particular pressure coming from the tech sector. that is it for today's show, i'm silvia. stay with c in, bc. worldwide exchange is coming up next.

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it is 5:00 a.m., welcome to worldwide exchange, here is your five at 5:00. quantum wreck, jenson wong, sinking stocks as his own stocks see the worst days in months. rising prices putting wall street on edge, sending treasury yields surging. u.s. stocks fall. however, futures are higher. metaceo reveals a content policy 180 as he preps for the trump administration. and palantir is off to