gpus. >> deep sea. >> their model is actually the top performing, or roughly on par with the best american models. you can see the deep sea new model. it's super impressive and it's super compute efficient. >> we're not just about managing information. we're about supplying digital workers. now we're. >> making this. >> transformation of digital labor. >> it is 5. >> a.m. here at cnbc global headquarters. welcome to worldwide exchange. >> here is. >> your. five at five. futures are mixed after a turnaround tuesday on wall street. we're going to dig. into the aftermath of that deep sea fueled selloff. front and center today big tech earnings with deep sea could mean for. >> tesla. >> meta and microsoft. >> also new. >> reports this morning microsoft is probing. >> deep c its roots. >> and possible. >> unauthorized access to its data. and counting down to the fed decision. today and what jay powell might say about trump's first two weeks in office. and no spending struggles here. the global chip giant seeing a big stock surge. it is wednesday,

january 29th, 2025. you're watching worldwide exchange right here on cnbc. good morning. thanks so much for being here with us. i'm frank hollins gets you ready for the trading day ahead. we begin, as we always do with the check of us stock futures after yesterday's bounce back on wall street following the deep sea fueled sell off on monday. important to note, week to date, the s&p and the nasdaq are both still lower. taking a look here. kind of a mix but muted start to the day here in the futures. the s&p up about two and a half points basically flat. the dow down fractionally right now down about 40 points. the nasdaq doing the best on a percentage basis up about 80 points or a third of a percent. we want to take a look at the leaders and the laggards on the s&p. >> 500 in the premarket. let's start with the leaders right here at the top of the list f five. those shares up over 14% following earnings. applied materials lam research godaddy and corning. rounding out the top five. >> all of them.

>> up over 3.5%. and we do have to take a look at the laggards. the other side of the. coin this morning. we're seeing packing packaging corporation down about four and three quarters of 1%. otis worldwide elevator maker other industrial equipment maker down nearly 4%. >> moderna obviously. >> a vaccine maker. down about 3.5%. tractor supply. >> and edwards life. >> sciences rounding out the bottom five on the s&p 500. back to the action yesterday. we saw a tech rebound yesterday as investors digest what it means for the ai trade and for valuations. altimeter capital brad gerstner on our air last night addressing all the concerns for the trade and specifically for nvidia. >> nvidia today, i. >> think you just. >> said traded 20. >> times revenue. it's trading at. >> 24 times earnings. >> right. people talk about the bubble. >> this isn't what bubbles are made of. >> and as far as i can tell the world's. going to be. >> you know. >> have. >> a compute shortage. >> for the next. >> 3 or 4 years. i don't think anything. >> yesterday changed that. >> all right. >> so again, gerstner saying not much. >> has changed. we'll take a look.

>> at bonds. >> going into the fed rate decision coming up at 2 p.m. eastern time. and speaking of things not really changing the ten year essentially. unchanged since the fed's hawkish 25 basis point cut back in december. take a look. you can see we saw some. spikes i'm not going to say we didn't see some spikes. but pretty much a straight line across from that fed decision in december to where we're at right now. a lot of spikes here a lot of questions about inflation. we saw some bond vigilantes. but again kind of back to where we were on the same day as that last fed rate. we're going to have roger ferguson here to talk all about it. a lot of eyes on this fed decision today a pause expected. but the tone of jay powell and whether or not he's going to address the president's demand for a rate cut that will be closely watched. again, roger ferguson coming up. all right. we are keeping an eye on tech and valuations this week following deep sea, but another trade that's been quietly bubbling the value trade since the fed's hawkish cut. and we've seen less optimism about the number of rate cuts this year. the value trades actually outperform growth. if you look at these russell etfs. we're going to talk to craig johnson from piper sandler about that hat tip of the hat to him. he

kind of tipped us off to that one. all right turning back to energy right now. markets continue to digest the potential impact of the trump tariff and trade policies. taking a look at oil and natural gas this morning we are seeing a pullback here. so wti the us benchmark back over three quarters of 1% trading at about $73.15 a barrel or so. similar story for brant crude trading at about 7680 a barrel. both of them down about three quarters of 1%. natural gas down about 3% right now. we're going to continue to talk about energy and the impact of trump policies on the energy markets throughout the show, and probably throughout this administration. and last but certainly not least, cryptocurrency trying to rebound from its own deep sea fueled sell off. take a look at the charts. we're seeing bitcoin down about over 2.5% week to date. you see the big drop on monday following the deep sea concerns. ether down more than 6.5%. solana down double digits. and we have anthony scaramucci of skybridge capital. he's joining us to look at bitcoin and also those crypto executive orders. a lot to talk about in that space coming up very shortly. okay. that is the setup. we have a busy day on tap for your money. we've got to give you your big money movers

right now. first let's start off with shares of starbucks. the company working through a turnaround under new ceo brian niccol. you can see shares right now are down over a half a percent. they beat wall street estimates for its most recent quarter, but reported same store sales did fall for the fourth straight quarter in a row. however, it was less than the street was expecting. again, shares of starbucks down over half a percent. you're going to hear much more from brian niccol when he joins squawk on the street later this morning. seeing some wild swings in shares of apple supplier cuervo after its latest earnings report, the stock surging 13%. you can see right here under some pressure this morning, down about 5% after reporting better than expected quarterly results. however, investors are very focused on comments from the ceo on its conference call last night about its, quote, largest customer, saying it expects revenue from that client to be flat to modestly higher for fiscal year 2026. again, shares of cuervo down about 5% right now. and we want to watch the action in those leveraged nvidia etfs. we talked about them just earlier this week. as short term investors pour money into the funds linked to gains and shares of the chip giant, graniteshares says it's seen about $1 billion

of inflows into the long product so far this week. again, we had our gunjan banerji on. she said these are for trades, not for long term investments. she was giving people kind of a psa when it comes to these leveraged levered etfs. she has an article in the wall street journal about it. all right. we want to stick with deep sync and this pressure on tech. we've got some new reports this morning that microsoft and openai are investigating whether their new chinese competitor used the openai ai model to train its rival chatbot, including unauthorized access to openai developer tools. microsoft reportedly flagged the massive combing of its data back in the fall to parties that it believes are linked to deep sink. also, david saks, trump's ai and crypto czar, said on fox yesterday this, quote substantial evidence deep see quote, distilled knowledge from openai models to create its own products. so this story seems to continue to have new developments. all right. turning back to the markets. stocks are bouncing back from the deep sea fueled sell off on monday. but the market is still showing some signs of distress. about 70% of the stocks in the s&p 500, they

were lower on the day yesterday. with the equal weight version of the index down just about a half a percent. semis. they may still be feeling the effects here. the stocks only trimming a fraction of its 9% drop on monday. and while nvidia jumped 9% yesterday, that's less than half the nearly 20% decline from the previous two sessions. joining me now, craig johnson, chief market technician at piper sandler. craig, good morning. good to see you. >> morning, frank. >> thanks for having me back on. >> the show. >> all right. so earlier we played a sound bite from brad gerstner. he said this isn't a bubble. he talked about the valuation of nvidia and just generally talking about the need for chips going forward. when we look at some of the pressure on chips in recent days, a lot of it linked to deep sea. do you think that we're seeing signs of a bubble, or maybe the cycle kind of reaching its peak? >> craig i. >> don't. think there's a. >> there's a. >> bubble in ai per. >> se at this point in time. but when you. do look. >> at some of. >> these individual stocks out there in semiconductor. >> land. >> some of. >> these stocks have made what a technician would call an island top, meaning they've.

>> gapped higher. >> they consolidated sideways and they gapped down again. that typically is not a pattern that is typically going to be a quick continuation of the uptrend. it's going to take. >> some time. >> frank, to digest. >> some of. >> those gains in some of those stocks. whether it's broadcom whether it's nvidia whether it's some of those names. again the expectations are super high. the opportunity is super. high for nvidia. but when you come back and you sort of look at what happened post this i sort of slide in the market. we saw earlier this week you saw. >> the market. actually broadening. >> out and you started seeing value stocks actually starting to pick up. >> and if you looked at. the russell. >> 1000, 2003 thousand, you actually. >> saw. >> more advancing. >> versus declining issues. frank, as you sort of went down cap. >> you know, craig, let's talk about that for a second. i gave you a tip of the hat just a bit ago. you pointed this out, actually, if you look back all the way back to that hawkish cut from the fed back on december 18th. value has been outperforming since then. in your mind. what does that signal about market sentiment about what investors are looking for. and are investors looking for

dividends or are they looking for income. or do you think this is simply some concerns about the high valuations. and they still like growth, just not at this valuation. >> i think. >> it's a. >> combination of things. i mean, first and foremost, you've got a new administration that's coming in. >> so there's a lot of questions about what policies are going to look like. so investors are going to be doing some rotating perhaps out of a very concentrated mag seven trade. >> and they're going to be looking for. >> other areas perhaps down cap that look more constructive on the charts. i think number one, i think number two, as we sort of break this apart, we do have a yield curve. >> frank. >> that is steepening. and that should be a very bullish. >> trend for the. >> financial sector. so it doesn't have to. just be those mag seven stocks or just the ai trade. it can. >> start to broaden. >> out as the. economy looks good. jobs are still strong. >> and you're seeing those. >> productivity gains. >> happening from ai. the economy. >> is. >> in good shape. >> and that's. >> what i think other parts of the. >> market like. >> financials are starting to tell us. >> so craig, you made some moves in your piper sandler technical

portfolio, technical opportunities portfolio, including american airlines and also nrg and energy name. i want to ask you about those two picks as an add. what are you seeing in the airlines and travel that made you bullish on that? and then nrg, are you concerned about some of the weakness we've seen in energy following deep sea? it seems like the whole deep sea concern is hitting every part of the market. >> you know, frank. >> first in terms of american airlines, when i. >> look through. >> all the transportation. >> stocks, these. airlines have literally the best relative strength. and in the role that i'm in, i do a lot. >> of time. >> on airplanes. and you just look around the airports. there is no shortage of travelers at this point in time. if you sort of digest the numbers that delta put out the other week, they're continuing to see revenues per per seat continuing to grow. these airlines are showing great relative strength on the charts, and the fundamentals seem to be lining up. and it is a stock that is performing well not. >> only american airlines. >> but delta and the others. >> and then the. >> other one, frank, in terms of nrg, there is no question that

there is a shortage of electricity. there's more. >> data centers. >> that are getting built. >> and if. >> you look at these. independent energy producers, energy is in a pretty good spot to continue to do well. and again, from a trend in relative strength perspective. nrg stands out from. >> our from our. >> vantage point looking at the charts, and is definitely one i think investors want to continue to keep focusing on. >> all right. greg johnson from piper sandler, always a pleasure to see you. thank you very much. >> thanks, frank. >> all right. we got more to come here on worldwide exchange, including a bullish take on a not so sexy name tied to the ai revolution. but first, anthony scaramucci. he's here on the next big thing he says investors should be watching for in the crypto space. plus, some big tech earnings on deck with deep six apparent success. what that could mean for at least three of the mag seven, and then later the countdown to the fed. we speak with former fed vice chair roger ferguson on trump's tariffs and what they could mean for the future of rate hikes. yes, i'm saying hikes. a very busy hour still ahead on worldwide exchange returns.

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with the comcast business 5-year price lock guarantee. five years? -five years. and he's not alone. -high five. it's five years of reliable gig speed internet. five years of advanced securit. five years of a great rate that won't change. it's back. but only for a limited time. high five. five years? -nope. comcast business 5-year price lock guarantee. powering five years of savings. powering possibilities. comcast business. >> welcome back to worldwide exchange. turning to cryptocurrency and the big and the big swings for bitcoin and other digital assets around the deep sea drama that's been gripping the tech world. take a look. you can see bitcoin is back above 100,000 after falling below that key threshold on monday. right now, up about a half a percent. for more on crypto's outlook. let's bring in anthony scaramucci, founder of skybridge capital. he also served as the white house communications director during the first trump administration. i'm going to add reality star.

we missed you in davos. heard you were the darling of davos. great to have you on the show. good morning. >> we got to. >> get. >> you to davos frank. >> you come. >> to the wine party that we host one year. that would be a lot of fun for us. >> we'll talk about that offline. let's let's get down to business anthony. good to see you. cryptocurrency bitcoin in particular fell on the deep sea drama. i want to get your take on that. why do we see bitcoin and other cryptocurrencies under pressure. >> well i mean let's start with. >> the good news. >> for bitcoin and other cryptocurrencies since the november 5th election. you know we've had. >> a 50. >> ish percent rise in most of them specifically bitcoin. you know which which i think topped. >> at around. >> 108 109. so a healthy correction made sense. and i think the market. >> was really. >> just looking for some type. >> of news. >> and of course this ai news was perceived negative in the us. but i would take the opposite view of bitcoin specifically. bitcoin is still over 100,000. it feels quite resilient here. somewhat

antifragile. you know the news settled in. and here we are still at 102,300. so i like that you you were talking before the break about what is coming up in the crypto universe. there's the there was an announcement about solana and the cme potentially offering a solana futures etf. frank, i think that would be amazing for the industry because it would be the precursor to eventually getting a solana cash etf like you've seen with ethereum. so as this starts to flesh out as the trump administration's regulatory framework starts to flesh out, i think you'll see that we're literally in the opposite. it's almost like you went through the hall of mirrors in alice in wonderland. we were in a very anti crypto position, you know, in the biden administration. and now we're going to almost the exact opposite in the trump administration. so i like you know, very bullish this year for most of these coins.

>> so anthony you're bullish and you're saying we're in a pro crypto situation with the trump administration. but we're going to show the chart right here. i'm looking at the chart for bitcoin since the inauguration. it's actually down about 3.5%. now obviously the deep sea sell off was part of that. but still down. it actually declined after inauguration day. what was your take on the executive orders? what's the sentiment in the industry with the idea that we do have a pro crypto president in the white house? >> well. >> you know. >> fortunately. >> i have a lot. i have a lot of kids, frank. the crypto industry has the patience of, you know, a seven or an eight year old. and they wanted donald trump to announce on january 20th at 1201 that he was going to have a bitcoin strategic reserve. and that would have been a bad idea, because what david sax is doing is he wants to build a broad based coalition that would include democrats and republicans to make something like a bitcoin strategic reserve bipartisan. otherwise, what will end up happening is you you get the reserve under republican

democrats, get ahold of the white house, they take the reserve back. and you have sort of this flipping and flopping, going back and forth as opposed to a consolidated long term visionary decision. so the move. to build a working committee, the. move to sort of address this and look at it over the next six months, i think, soured the industry. and so some of the short term traders, particularly those with leverage, sold their positions, not getting the super great news. but i think if you read through the executive orders, which we did, we're quite bullish on them. i think david has the right ideas and you've got positive regulatory people at the sec and treasury. >> all right. so you mentioned the sec, obviously, gary gensler out at the sec. the thought that there's going to be a big change in regulations. what are the regulations that in your mind are holding the cryptocurrency industry back, specifically bitcoin? i know you're a bitcoin maximalist. you think the coin's going to hit 200,000 by the end of this year? >> yeah. so i mean very, very simply just guidelines that i

was with brian armstrong, the ceo of coinbase in davos, who spoke on a panel together. coinbase has been asking the sec for over two years. just tell us what the rules of the road are. one of the big indictments of the gensler piece of the biden administration is it was a lot of regulatory regulation by enforcement. they're suing people left and right without giving them the appropriate guidelines. even a federal judge said that that was unfair and that it was incumbent upon the sec to provide guidance. so i think this year and certainly before february of 2026, we're going to get a piece of legislation related to crypto that will have specificity in it related to stablecoins, related to where bitcoin is actually going to be regulated. will it be at the sec or the cftc as an example? i think the industry is really just looking for a set of rules that they can follow that is satisfactory to the united states government. and i think that happens. and the reason why i'm saying february of 2026 is

that's really when the electoral campaigns heat up for the house races coming at the end of 2026. >> anthony scaramucci, really great to have you here. we got to have you back. really great to have you. i appreciate your time. >> i like getting up early, frank, and it's great to see your face this early in the morning here in new york. >> always good to see you. keep those invites to those wine parties coming, man. thank you again. all right. still on deck here on worldwide exchange. no deep concerns here. what asml ceo just told cnbc about the new ai competition that is sending ai competition that is sending its stock (vo) explore the world the viking way from the quiet comfort of elegant small ships with no children and no casinos. we actually have reinvented ocean voyages, designing all-inclusive experiences for the thinking person. viking - voted world's best by both travel + leisure and condé nast traveler. learn more at viking.com.

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>> ha ha. >> you all. >> should be laughing harder. >> welcome back. time now for your global briefing. we begin with alibaba releasing a new ai model that it claims surpasses deep sek's latest version, v3. across several benchmarks, alibaba's cloud unit introducing quen 2.5 max. it's a large language model, which it also says is competitive with the performance of top tier products from openai and from meta. shares of shares of lvmh and a number of other luxury names. they are falling in europe today after the luxury goods maker reported fourth quarter sales that just failed to impress investors. ceo bernard arnault telling analysts the company is seriously considering ramping up its production in the u.s, praising a wind of optimism versus the cold shower of potentially higher taxes in france. and then on the other side, shares of asml, they're surging as demand for its ai chip making machines show no signs of easing. cnbc senior technology correspondent arjun kharpal he joins us live from

asml hq with much more on that story arjun. good morning. good to see you. >> good morning frank. and clearly here. look the entire tech sector really saw a big sigh of relief after these asml earnings which showed a very strong 2024. but more importantly very key was the guidance for 2025. it was a record 2025 implied by the guidance of between 30 and ■k735 billion in revenue, and the company saying it's got a very strong backlog of orders and net bookings, showing a big jump as well. and that was very much key to assuage some of those fears around this deep sea story, of course, which has roiled markets the other day over fears that actually a more efficient model run on older nvidia chips could dampen some of that. spending on ai infrastructure, including the equipment that asml makes. but the ceo, christophe fouquet, who i spoke to today, actually had a different point of view. i spoke to him and asked him about what the impact deep sea might be on

the market and what his read on the situation was. let's just listen in to what he had to say. >> anything that will go in the direction of lowering costs of ai is in fact, most probably good news, because this will allow the application to go to many, many more devices. and this could be confusing at some point for people who watch this industry, but that's a great opportunity. >> so this is the debate here, frank. and i expect this to play out across all of us earnings season as well. the debate is this has deep tech shown we can do more with less. so does that mean that there will be less capex into some of this ai infrastructure? and the other side of the debate is this we can do it at a lower cost, some of these ai models. and actually this will spread the tech further and mean there will be more uptake of the technology, which will support all the infrastructure layer as well, including the chips and companies like asml. that's the

view that the asml ceo is taking and that's the debate. i think that's going to play out across the earnings season. and certainly as we go into those big us tech earnings, a lot of investors and analysts are going to be asking questions about capex and whether all of these giants, the likes of microsoft and amazon and google, are going to continue to invest in ai at the rate they have been so far. for now. frank, back to you. >> arjun, thank you very much. arjun gopal live at asml headquarters. thank you again, arjun. all right. as we head to break, we're tracking the wild action in cybersecurity stocks. talking names like crowdstrike and palo alto networks coming off their best day in months. crowdstrike sitting at an all time high on the heels of monday's deep sea martin market meltdown. you can see the big gains right there. this morning, however, the group kind of giving back a little bit. we are back right after this. stick with worldwide exchange. we've got a lot more to come. >> i started lucens with. >> the mission of bringing

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federal reserve and its policy path forward. the president turning up the pressure on the central bank and its leaders to continue cutting rates ahead of its latest decision this afternoon. welcome back to worldwide exchange. i'm frank collin. former fed vice chairman roger ferguson is standing by with what he thinks chairman jay powell will say and how he will respond to the president's demands. a lot to talk about there. but first, we kick off the half an hour, as we always do with the check of us stock futures. after yesterday's bounce back on wall street following the deep sea fueled sell off on monday. important to note week to date, the s&p and the nasdaq are both still lower. you can see right here still a bit of a mixed picture. right now the s&p flat just kind of turning fractionally lower right now. the dow down about 25 points or so. the nasdaq the best performer up about 60 points up just under around around a third of a percent or so. when you take a look at the nasdaq 100 premarket leaders, these are the stocks moving the nasdaq 100 higher right here at the top of the list. asml we just had arjun kharpal talk about their earnings. a lot of bullishness there. applied materials lam research micron. marvell technology chip names rounding out the top five in the

nasdaq 100 gainers. then the other side of the coin the premarket laggards on the nasdaq 100. taking a look here. datadog. this is actually a cyber name. pulling back a bit. datadog saw some gains in the last few days during this deep sea fueled sell off. diamondback energy, regeneron, dexcom, and honeywell rounding out the bottom five on the nasdaq 100. back to the action yesterday. we saw a tech rebound yesterday. as investors, they digest what deep tech means for the ai trade and for valuations. altimeter capital brad gerstner on our air last night addressing the concerns for the trade and for nvidia in particular. nvidia today, i think. >> you just said. trade 20 times revenue. it's trading at 24 times earnings. >> right. >> people talk about the bubble. this isn't what bubbles are made of. >> and as far as i can tell the world's. >> going to. >> be. >> you. >> know, have a compute shortage. >> for. >> the. next 3 or 4 years. i don't think anything. >> yesterday changed that. >> so again, gerstner saying not much has changed. now we look at the treasury market, looking at bonds, specifically the ten year going into the fed decision coming up at 2 p.m. eastern. and

speaking of not much changing the ten year basically unchanged since all the way back here december 18th. the fed's hawkish cut. you can see pretty much at the same level moving just a few basis points again after that hawkish cut in december. we're going to talk about roger ferguson about all that coming up in just a second. and we've been talking a lot about tech and valuations in tech this week following deep sea. but another trade that's been very quietly bubbling up. it's the value trade since the fed's hawkish cut again back on december 18th. and since then we've seen a lot less optimism about the number of rate cuts this year. take a look here at the chart. the value trades actually outperformed growth. if you look at these two russell etfs the iwd and the iwm. you can see here the value trade outperforming up about two and almost a half a percent. since that hawkish cut. the growth trade however down over 1%. taking a look at those moves again tip of the hat to craig johnson of piper sandler. we also want to look at energy, those markets that continue to digest the potential impact of trump tariff and trade policies. taking a look at oil and natural gas. oil pulling back even more from earlier wti and brant crude both down just about 1%. natural

gas down about 2.5% right now. and last but certainly not least, cryptocurrency again trying to rebound from its own deep sea fueled sell off. you can see the big downside moves following the deep sea news right here. when it comes to cryptocurrency, not really a bounce back. we've seen a bit of a recovery, but you can still see here week to date bitcoin down about 2.5%. ether down more than 6%. solana almost down 10%. we had anthony scaramucci coming on or he was on earlier saying that people were kind of looking for a reason to sell. after a big run up following the election. okay. that is your setup. now we want to turn our attention to the fed set to hand down its latest rate decision this afternoon. expectations are that the central bank will keep rates unchanged thanks to continued strength in the labor market and some progress on inflation. but that's not likely to sit well with the president, who, as you just heard a moment ago, said last week he would soon demand lower rates from the fed and its officials. for much more on this, let's bring in roger ferguson, former federal reserve vice chairman, former tiaa president and ceo and, of course, a cnbc contributor.

roger, good morning. it's good to see you. >> good morning. frank. nice to be with you. >> all right. so if we're looking at what bond traders are pricing in, they pretty much think it's going to be another pause. it seems like everybody's really focused on the tone of that pause and what jay powell is going to say. what are you expecting, especially following the president's comments that he wants to see rates lower? >> i'm expecting three things. first, as with markets, i'm expecting a pause. secondly, as he said the last time around, they're in a new phase now where i think they're wait and see. they'll be talking about being data dependent, for sure. and he'll. undoubtedly talk about, you know, incoming data. that has been a little disappointing on inflation. >> has shown underlying strength in. >> the economy. fortunately, in labor. markets in good shape. and i think he'll be asked. about the president's comments. and my suspicion is he. >> will. >> you know. >> continue to. >> reinforce fed independence from political pressure. >> you know, roger, i'm just about as certain he's going to be asked about the president's comments, as everyone seems to

be asserting that we're going to get a pause. so when these questions come up, i think it will be more than just one. how do you expect jay powell to respond? i've seen some articles that say that he's going to try to just avoid saying anything that might lead to a reaction from the president and others that think this is a very important inflection point, where jay powell needs to really assert the independence of the fed and push back against the president. which way do you see it going? >> i think. >> he's going to want. >> to avoid. >> a, you. >> know, a tit for tat fight with the president, while reassuring markets that the fed. >> is going. >> to be independent and set policy based not on political pressure. >> but rather on. >> incoming data and focusing on its mandate. i think he's also going to say that by having the fed do that, it creates more room for, you know, the fiscal approaches that maybe the fed. wants that the president might want. and it's overall good for the economy. so i think he's going to reinforce that an independent fed is good for the u.s. economy, which is in turn good. >> for everyone. >> how do you see fed officials digesting some of these tariff

policies, some of these tariff threats, for example, colombia, we called it kind of the shortest trade war that ever happened. the idea that we might see tariffs on canada and mexico, we might see increased tariffs on china. how do you think they digest that when it comes to the decisions going forward. and does this put potentially this year a hike back on the table. >> i think they'll wait and see exactly what unfolds with the tariffs being put in place to date. what we've seen look at colombia, is the threat of terrorists being used as a, as a as a tool for international diplomacy. and so i think it's going to be too early for most of them to firmly have a firm point of view about the impact of tariffs, whether or not it leads to a potential hike. there's certainly some discussion in markets and other places and economics about how to deal with tariffs. are they just a one time change in price levels or given the experience that we've had, do they risk kicking off another round of inflation. so i would say that it's a possibility that we'll see hikes later. but it depends very much on the incoming data.

>> and also. >> how the policy itself unfolds. >> roger ferguson, always a pleasure. great to see you. thank you very much. coming up here on worldwide exchange, a trio of seven members set to report earnings with new worries over deep sea could mean for big capex spending around artificial intelligence. take a look at the companies reporting today. microsoft down fractionally. meta up over half a percent. tesla down a half a percent. we're back in just a moment. >> are you overwhelmed with identity management in the context of omnipresent threats to your organization? >> hi. so no one knows what that means. >> what's happening? >> just explain. i want. >> to help. >> secure digital identity. >> keep it simple. >> like what? >> like when delivering a fresh uniform. >> or viewing. >> your results. yeah. >> it's bad. >> or making brad swoon. >> at the high school reunion. >> oh, i love. >> that color. >> whew. >> that was a lot. >> oh. >> there's more, like.

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sea uncertainties if all those weren't enough. investors are also on the look out for a trio of mag seven names reporting after the market closed. today we're talking microsoft, tesla and meta, and they're specifically watching for commentary on ai spending, especially in the light of that deep c cost breakthrough. joining me now is sarah kunz, managing director at clio capital. sarah good morning. last time i think i talked to you, you were on your honeymoon, so it's great to have you. just, you know, regular work time. great to have you here. good morning. >> yes. back. >> let's start off with this deep tech news. does it does it change as we go into earnings for these three companies meta, microsoft and tesla? does it change any of the narrative of them for your. probably a little technical difficulties. but why don't you go. >> yeah. >> so it'll. probably somehow be good for tesla. >> everything seems to be good for tesla. the reality i think, though, is that it's going to depend on the storytelling. these companies are lucky probably, that that the. deep

sea news really hit a. >> frenzy over the. >> weekend and. >> that some of that is already priced in. so they've had time to kind of workshop those narratives and say, hey. here's what it means for us in general. if you're a meta, it's actually probably good because you get to say, look, guys, we're not going to have to spend quite as much as you might fear over time on ai. and we can get back to dividends faster. right. and so i think that for some of those names, it's good, i think for the teslas of the world it's sort of irrelevant, but i'm sure that they will spin it in a way where everything's coming up, elon, because that tends. >> to be. >> what they do. and so i think it's going to be a case by case basis. you know, there's a reason, i think that we saw nvidia, rightly or wrongly, sort of bear the brunt of the deep sea news. >> all right. we also got some news this morning from alibaba that they have a new model out. is this something that we just need to get used to? the idea that tech companies, specifically tech companies in china, are going to roll out these models and that it could be disruptive to the narratives of some of the companies that we've been investing in and

seeing move the market higher. how do you just view this development? just on the heels of deep sea just a few days ago? >> absolutely. i mean, obviously, a lot of the chinese tech companies have a lot of involvement from their governments, which can, you know, kind of in impact when they announce things like this. that being said, anybody who thought that china somehow wasn't working on i wasn't paying attention to the chip war. right. and anybody who thought that they weren't going to come out with some great ai models themselves, i think hasn't been paying attention to history and their technological prowess. so if this disturbs your narrative, i think you were maybe listening to the wrong narrative to begin with. this isn't shocking. it's basically i would say about on schedule. >> all right. in all fairness, brad gerstner from altimeter capital, he basically said nothing's really changed when it comes to this narrative either. so he agrees with you as well. i want to get back to the companies reporting earnings today, specifically microsoft and meta. they came out with their capex guidance from microsoft. it's $80 billion for meta. it's 65 billion. is that good. now is that not as good. now that we know that some of these models can be created with

less money. and maybe you don't need as much power, you don't need as much time. you don't need as many data centers. >> you know, data centers are going to find uses you're probably seeing a lot about kind of the japanese law popping around on the internet right now. the reality is that in general, when something becomes more efficient, we spend more of it. remember how we barely used to touch our cell phones when it was like $0.10 a minute to talk? and then now most of us have unlimited and, you know, unlimited data and we cannot be pried away. so the reality is that as data, as compute gets cheaper, as it's cheaper and cheaper to be able to actually invest in and use ai, you're going to see sort of more applications of it, probably faster. and so i don't think that that microsoft or meta is going to get dinged this quarter for that spend. you know, but i do think that that people are going to be questioning, what does that look like three quarters from now, two years from now? because a lot of the narrative, particularly out of openai, has been you will have to keep spending all the money forever, right? i think at 1.7 trillion was a was a number that

was being floated. and that's not really accurate. but i think the smart money always knew that wasn't accurate. >> but i had spent i think the minutes were free after seven. so i did use my phone just for clarity. i want to get to tesla very quickly. i was just actually talking to an auto executive yesterday, saying that tesla has been actually losing market share in the us to gm, to other carmakers in both luxury and also in, you know, more reasonably priced models, if that actually comes out to play out when it comes to tesla, does that in your mind, does that change your view of the company? like, isn't there still a lot of debate about whether tesla is an ai company or an auto company? if the numbers and the auto business are declining, what does that say about the overall business? >> tesla is an elon company. if you take any sane metric and multiply it by ten or probably even 100 in terms of what automakers are valued at, you get nowhere near tesla's value. and that's been true for a really long time. tesla is a bet on elon. that is an increasingly

sketchy bet because he's spreading his time thinner and thinner. but that is really what i look at tesla and the market as do they have some ai? sure. but he's putting a lot of his ai efforts, such as they are into x ai and not into tesla. and so if you're buying tesla based on an ai story, i don't quite understand that trade. and yeah, the amount of cars being sold is going down. we're not seeing some great new hero car either. super, super high priced with great margins or really, really affordable. so i think tesla's tesla. >> all right look at tesla's forward p e right now 128 times forward earnings sarah kunst always good to see you. thank you very much. thank you. coming up here on worldwide exchange, we have the one word that every investor has to hear today in the stock pick that every investor needs to know. plus a federal judge hitting the brakes on president trump's federal aid freeze. the spending showdown taking shape in d.c. over billions in taxpayer dollars. billions in taxpayer dollars. we'll be right b (wind, rain and rolling thunder) (♪♪) nobody's born with grit.

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>> light. it guides. >> our. >> every waking moment. >> what we do. >> and how we do it. but the amount of light we need can change in an instant. and when. >> it. >> does, you can control it. >> three day blinds. find the light for. >> your life. >> visit three day. blinds.com to get started. >> returning to washington in a fast moving developing story. a federal judge intervening in the effort by the trump administration to cut trillions of dollars in government spending through freezing congressionally approved federal grants, loans, and other financial assistance programs. our emily wilkins joins us now from miami with much more on this story. emily. good morning. >> good morning frank. >> well. >> yeah, the trump administration really sent some shockwaves through d.c. yesterday with that executive order to halt. trillions in funding. >> but here at the. house

republican. >> conference in miami, there was. barely a tremor, even as medicaid. >> portals closed across the country. >> now, the white house did. >> of course, update their guidance. >> to significantly narrow which. >> programs are going. >> to have their funding frozen. and then, as you mentioned, that federal judge blocked the order. still. >> this is a really major. >> early sign of. >> how far republicans are. going to. go to. >> back trump, even when he encroaches on congressional powers like. >> funding the government. >> speaker mike johnson. >> told. >> reporters that he fully supports. >> the. >> freeze, saying that any pause in funding would likely be a short one. >> this is a. >> i believe, a common application of common sense. >> we want to make sure. >> that the executive orders of the new president are being fully complied with. >> with. >> regard to these programs. >> a lot of republicans. >> that i spoke with. >> also mentioned savings. >> as an important thing here. >> and republicans. >> are going. >> to be facing a. >> major test. >> of how committed. >> they are to reducing federal. >> spending. >> likely next week.

>> lawmakers say that they are expected to begin moving. >> on a massive bill. it's going to include energy. >> border security, health. care tax policies. >> but the first step. >> to. >> all of that is actually to vote on how. >> much the entire. >> package is. >> going. to cost, and if. >> it. >> will eventually add. >> to the deficit. >> now. >> johnson said that the objective. >> is to. >> have the policies fully paid for. >> but he has. >> yet to. >> detail how lawmakers are going to. >> offset trillions. >> in expenses. and, frank, we will definitely be keeping a very close eye on that when we get back to d.c. >> next week. >> yeah, i would imagine you're keeping a very close eye on it. so mike johnson seems to be okay with it, but i would imagine there might be some other members of congress that are taking issue with it. what are you hearing? i know you're there with a lot of congressional leaders right now. >> you know, honestly, frank, i was able to speak with a number of lawmakers yesterday. this includes appropriators, the members who actually. >> sit on the. >> very powerful committee that is responsible for saying, okay, this program is. >> going to get this amount. >> of money. and really, it was.

>> very difficult. >> to find anyone who had any. concerns with it. we did hear don bacon. he's one of the few republicans who's actually in a district that biden won in the. 2024 election, and he. >> had a couple concerns when that. >> seemed to be a pretty broad ranging thing. but then after it was narrowed down, he said that he felt it was more appropriate, given that these programs that are being targeted are specific to the executive orders that trump put forward. >> so really couldn't find. >> anyone to really speak out against what the. >> president did yesterday. >> very, very notable. >> i mean, very notable. i've seen a lot of articles calling it impoundment, actually, and that there's actually a law against it, but i'm sure this is going to be played out in d.c. all around the country. i mean, i'm sure a lot of people are talking about this, a lot of people potentially impacted. of course, emily wilkins live from miami. great to see you. thank you very much. coming up here on worldwide exchange, the under the radar real estate player, our next guest says offers a great dividend option for investors. that name we're going to reveal it with our mystery charts up over 15% so far this year. it's coming up next. stay with us.

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>> the day's top stories driving wall street. brian sullivan joins kelly evans power lunch, weekdays two eastern, cnbc. >> to me, ambition is drive. it's the fire in your belly. i didn't go to college right out of high school. i worked full time while doing school full time. somewhere along the way, i got bitten by. >> the journalism bug. >> no one's going to give you your dreams. you have to roll up your sleeves and. >> work hard. >> to achieve them. money doesn't make the world go round. information does. and cnbc is the great economic. equalizer because we. provide that information so you can make the decisions that are right for you. cnbc is an adventure beyond my wildest dreams. >> welcome back to worldwide exchange. as we close on the 6 a.m. hour, here's a look at some of the big stories that we're following this morning. microsoft and openai are reportedly investigating whether deep sea used openai's model to train its rival chatbot, including unauthorized access to openai developer tools. apple is

reportedly working with elon musk's spacex and t-mobile that support for the starlink network in its latest iphone software, according to multiple reports. the trump administration is offering millions of federal workers the option to accept buyouts. the white house tells nbc it expects up to 10% of federal employees to take those buyouts. cnbc is also learning that google maps is has reclassified the us as a sensitive country in the wake of president trump's recent gulf of america comments. the designation is for states with strict governments and border disputes. chubb is putting an early price tag on the impact of the la wildfires. they now estimate those fires will cause $1.5 billion this quarter. and the financial times reports that meta ceo mark zuckerberg is looking into buying property around dc. the ft notes the move comes as part of zuckerberg's push to shape president trump's views on the tech sector. all right, turning back to the markets, stocks trying to add to the bounce back from monday's deep sea fueled sell off. taking a look at futures. it's been kind of mixed all morning long right now. similar situation the

s&p up fractionally. the dow looks like it would open about ten points lower again pretty close to flat fractionally lower. the nasdaq doing the best up about a third of a percent or 85 points. joining me now is matt powers managing partner at the powers advisory group. matt good morning. good to see you. >> morning, frank. >> so, matt, what is your word of the day? how do you see today shaping up? >> so the word of. >> the. >> day is inflection. and here's why. so it's already a big week and there's a lot going on here. we started the week off with the deep sea headlines. and you know couple that with key earnings reports on mega-caps meta microsoft tesla today and apple tomorrow. and there's a fed decision out today pce report out friday. and we're only a week off from inauguration. so it tees up for an important busy day and week for that matter. but it's inflection because it might shape up to be a potential turning point or inflection. looks like we could shift some focus from mega-caps into some other sectors. i talk about that a lot. so maybe a little recalibration in the markets and investment strategies in general. >> all right. so you think it might be a recalibration. we were hitting on this earlier with the guest. the fact that

value if you look at these two russell etfs that we're about to show values outperform growth since the hawkish cut back in december. how do you view the value trade right now. are you looking for stocks that pay dividends. are you looking for income or are you looking for growth. >> yeah. so a little bit of both. you know it's an interesting conversation to have. so one of the more common conversations we've had with clients right now is what to do with the concentrated mega cap positions they've got. and we've kept the stand to hold the positions, and you have to start looking elsewhere to diversify into some undervalued stocks. it's standard practice in managing an investment portfolio. and i'm afraid it's actually gotten lost on some investors. so you know from that you know. well while tech struggled monday, dividend focused etfs like schd, which is schwab's us dividend equity etf, it was up more than a percent that day. so you know traditional value and defensive sectors had nice gains on monday. and it's just a reminder there's more to the market than just tech and i. and if monday monday made investors uncomfortable we've got some different areas we're looking at. >> matt we want to get to your

pick for today. what is your pick and why. >> prologis. so it's a it's not necessarily a household name but really it should be. it's their $100 billion reit. they're the largest owner and manager of industrial properties and warehouses and distribution centers in the us. and you know again this is a pure dividend growth play. so we're not typically recommending reits. but they've got a very healthy yield 3.4% yield. and you just mentioned it i mean the shares are up 15% so far this year. but it's still off 30% from its 2022 peak. and they had an earnings report out last tuesday that was very favorable. and the stock jumped. but there's just plenty to like here. and it's adding a great dividend growth name at an attractive valuation. and it's completely understated at this point. >> 3% dividend to your point matt powers always a pleasure to see you. thank you very much. your pick for us today prologis. >> good to see you. >> good to see you. here's what to watch. today we get earnings from microsoft meta and tesla after the bell at 2 p.m. we've been talking about it all morning long. we get the fed's latest rate decision followed by

chairman jay powell's press conference. and we also have a cnbc exclusive for you, an interview with starbucks ceo brian niccol on the back of the company's earnings. that's coming up at 9 a.m. eastern. a lot to talk about there when it comes to the coffee chain. one more look at futures before we let you go. we've been looking all morning long. futures a bit mixed right now. the nasdaq the best performer up about a third of a percent. the s&p and the nasdaq are the dow i should say both pretty close to flat. that does it for us. squawk box starts right now. >> good morning. a federal funding freeze has now been frozen. a judge ordered a halt to the trump administration's order. we've got details straight ahead. plus, the white house offering buyouts now to nearly all federal workers, including benefits and eight months of pay for those who resign by february 6th. plus, a flood of eye news will bring you just from overnight alone, including reaction to deep seek. the launch of alibaba's new ai model and so much more. it is wednesday, january 29th, 2025. and squawk box begins right now.

good morning and welcome to squawk box right here on cnbc. we're live at the nasdaq market site in times square. i'm andrew ross sorkin along with leslie picker this morning and mike santoli becky and joe are both off today but that doesn't stop the train. we've got a lot going on and the train has left the station on the news front this morning because there is a lot of it. let's show you. u.s. equity futures right now where things stand. dow not moving around too much. it was just in the green about a moment ago. now you're seeing a little bit of red. but the nasdaq up about 79 points. looking at the s&p 500 up about four points. all of this coming after stocks climbed yesterday recovering now some of monday's losses. the dow up by 3/10 of a percent. the s&p up by 9/10 of a percent. the nasdaq had risen by about