othe sidelines. hey, cougs! good job. good job. [cheering] [theme music] >> good morning. and a. >> happy valentine's. >> day to you. >> welcome to street. >> signs i'm. >> juliana tattenbaum. >> and these are your headlines. >> markets are red. >> tariffs are due. european forces come. under pressure in early trade as investors struggle to fully shrug off. >> president trump's. >> pledge to impose reciprocal tariffs. >> i have decided, for purposes of fairness, that i will charge a reciprocal tariff. in other words, they charge us a tax or tariff and we charge them the exact same tax or tariff. very

simple. >> hermes flies. >> off the shelves, trading near the top of the. >> stoxx. >> 600. >> on the back of a near. >> 20% jump in. >> fourth quarter sales, almost double analysts. >> estimates. >> as the. >> french luxury house. >> continues to outshine its peers. natwest guidance. >> fails to win. >> investors hearts. >> this valentine's. >> day, putting. >> the stock. >> in the red despite. >> a full year. >> profit beat. >> cfo katy. >> murray sounds a positive note. >> on the uk economy. >> we saw lending going up by 3.5% and that really just demonstrates actually the customers are using their their money to invest in their businesses, invest in their homes. we do think that there are reasons for optimism as we move forward from here. >> and president. >> trump talks up the. >> prospect of. >> ukraine peace talks as. >> officials gather. >> at. the munich security conference. >> but kyiv. >> warns against any. >> premature agreement. >> with moscow.

>> president trump has announced plans to impose what he calls. reciprocal tariffs. >> trump said they will. >> be set on. >> a country. >> by. >> country basis, taking tariff. >> and non-tariff. >> trade barriers. >> into consideration. >> commerce secretary. nominee howard lutnick told reporters. studies into tariff. >> levels would. >> be complete by. >> april 1st. >> president trump. >> looked to dismiss concerns that it could lead to higher inflation for americans. >> i'll tell you what will go up is jobs. the jobs will go up tremendously. we're going to have great jobs, jobs for everybody. this is something that should have been done many years ago. china did it. i mean, china did it at a level that probably nobody's ever seen before. if you manufacture a car, you couldn't send it into china. the tariff was so high. so everybody went and they built in china. it was no big secret. so we're going to see. but it's going to mean tremendous amounts

of jobs. and ultimately prices will stay the same. go down. >> president trump there speaking. >> to reporters. >> he spent. >> about an hour with a small group of reporters. >> our own. >> eamon javers in. >> the room asking questions. >> to. >> the president. >> and you just heard there he was. >> pressed time. >> and time again. >> around. the impact. >> on. >> prices that these. >> new. >> tariffs would have. >> and he just steered the conversation to jobs, saying. >> that the new. >> reciprocal tariffs. >> that are on the horizon. >> now, due to come. >> into effect after. >> all of this analysis. >> is done, will. >> create more. >> jobs in the. >> u.s. >> that's his message. the economics community. >> seems to be in. >> unison in believing that they will lead to. >> higher prices. >> as for. >> markets. >> at the. >> moment. >> by. and large, investors. >> seem to be. >> taking the. >> view that this is more of a negotiating. >> tactic, that this is. president trump. >> as a negotiator. >> at. >> play rather than an. >> end game. >> these reciprocal. >> tariffs that are. >> have been put. >> in motion. here's a look at how european stocks are faring. >> you've got footsie 100. >> here in the uk down. about 4/10 of a percent. the xetra dax

is down slightly. this morning. but the dax is the best. performing major equity. index of 2025. >> and just yesterday. >> we saw the dax gain 3.8%. >> so it's been. >> a really strong run for german stocks and a strong run for european equities. altogether the cac40 up. >> 4/10 of a percent this morning. >> and the footsie in italy up 2/10 of a percent. so a little bit of mixed trade this morning. but this is after a quite a decent run for european equities in terms of the sectors. let's take a look at the breakdown this morning. those out in front. we've got basic resources up 1.6%. technology up. >> 6/10 of a percent. >> we had some. strong moves to the upside in. tech stateside yesterday and also overnight in asia. so a little bit of that positive momentum coming into. >> europe this morning. >> household goods also doing well up half a percent in chemicals up. 3/10 of. >> a percent. >> on the flip side the laggards in europe this morning what is trailing. you've got health care down. 7/10 of a percent. telcos insurance media. so those more defensive stable parts of the market underperforming this morning. and a little bit more demand for those cyclical

sectors. now i mentioned the strong performance into today. and i think it's worth just looking at where we've traveled over the course of the last week. you can see european markets week to. date and the xetra dax, as i mentioned, up 3%, 3.8%. >> week to date. >> i said that was yesterday's trade. that was in fact the week to date level. but the message. >> here. >> european equities have been quite strong of late. >> now this morning. >> investors not only reacting to these reciprocal tariffs and the news out of the white house yesterday but also earnings natwest reporting a better than expected annual profit of 6.2 billion pounds. the british lender raised its return on tangible equity target to more than 15%. in the next. >> two years. >> cfo katy murray told cnbc she is confident the bank remains on a growth trajectory. >> we've been one of. >> the. >> obviously the very. >> large players within the bank with the biggest bank for uk business in the in the country, and then you can see in our retail division, it's been a really steady progress of growth over many, many years. we do think we've still got more

growth to deliver that, whether. >> that be. >> in mortgages or in something like credit cards, which you which is the reason behind the sainsbury's transaction of last year. we've grown that from about 3% market share. >> up to now about 9%. >> and then by the time we do the sainsbury's transaction, we'll be around 11%. so we're definitely a very big scale player, but we do really, really and pleasingly have. areas that. >> we. >> can continue to grow and continue to. >> take market share as. we move on from here. >> katie, more broadly, do you think we are seeing a consolidation cycle now? because let's face. >> it. >> interest rates are retreating. >> so some of those best heady. >> moments of net interest margins. expanding are really behind the industry now. so consolidation does make sense. >> there is definitely been and you saw last. >> year was. >> a lot of consolidation with some of the transactions that happened elsewhere. i'd probably challenge you a little bit on the nim is going to be contracting from here. i think one of the real features of our results, with our improved guidance from next year, we're taking our income of 14.6 billion this year to 15.2. >> to. >> 15.7 next year. much of that will come from our nii. so

actually what we will see is some expansion. i think, of nim as we move forward from here, you know, and that's because of the benefit of things like our structural hedge. coming through and just the kind of the management of our balance sheet as well. so i do think with our improved guidance, there's very, very strong results still to come from the banking sector and from us particularly. >> santander has reportedly discussed a potential sale of its uk retail business with natwest. that's according to. the financial times, which cites people familiar with the matter as saying early stage talks took place last year and both parties remain interested. speaking to cnbc this morning, the cfo declined to address the reports directly, but said there would be a high bar for any future acquisitions. >> i wouldn't. >> comment on any speculation on things like that, but when we look at our capital distribution, we've always been very committed and demonstrated a real a real kind of rigor around how we dividend, how we distribute that out to our, our, our shareholders, whether it be things like dividend, which you've seen us increase this year, or whether through a series. >> of buybacks. >> that we've done, and we've

further increased our dividend next year to above 50%. any kind of acquisition. >> has. >> an incredibly high hurdle rate. and just given the expectation of our. >> shareholders. >> we were very pleased last year to. >> take part. >> in the consolidation. we did a book of mortgages for metro bank and also the sainsbury's bank. portfolios as well, which showed that we were able to scale very easily, but it's not something i'd comment on specifically this morning. >> hsbc, meanwhile, is reportedly set. >> to. >> launch a new round of job. cuts at its investment bank. that's according to bloomberg, which says the cuts will start in asia but the but be global. it comes as the financial times says hsbc will report $1.5 billion of annual cost savings next. >> week as part. >> of ceo george eldridge's radical overhaul. simon ainsworth joins me now, associate managing director at moody's ratings, to talk through what's been going on in uk banks. simon, so much to talk about. i'll just kick off with the latest out of natwest. we just got their earnings through this morning and listening to the cfo speak there, she sounds pretty confident about the outlook after what's been a

pretty decent quarter to end out the year. what's been your take on the numbers? >> yeah. >> so we think that natwest. >> and. >> indeed most of the numbers coming out so. >> far. >> are broadly. >> in line with expectations and, you know, showing that profitability is remaining robust and looking forward. i think we have a you know, based on the clip you just played, i think we have a reasonably similar view in the fact that profitability, we expect while it might decline slightly across the board, we do. expect it will remain robust going into the rest of this year and in part in the uk. that is based on the structural hedge that the large banks have in place to kind of really manage the transition to through through this interest rate cycle, both up and down. >> what can we glean about. >> the health of. the uk consumer, the uk household, from the bank results we've had so far this quarter? >> i think, you know, there's clearly a different story in what we're seeing in terms of the bank numbers from that, the

story we're hearing on the general economy, asset risk remains exceptionally low for uk banks and natwest. i think we're reporting nine basis points of credit of cost of risk today, which is exceptionally low both, you know, within the uk but also amongst european and global peers. and this is this has been sustained. so the prospect for deterioration in in lending quality is really not there. we expect that to remain kind of muted despite kind of maybe some pressures coming through from things like the increased tax on, on payrolls on uk small businesses. >> simon, the other piece of the natwest story this morning that has investors attention is the story from the ft that natwest has spoken to santander about. >> potentially taking its uk. >> retail business off its hands. we obviously didn't get the cfo to comment on that story. she wouldn't comment on speculation, but what would that deal mean for natwest? >> and is. >> that something that you see

actually coming together? >> well, look, you know, as the cfo said, that is some speculation. there's nothing to kind of to confirm that's likely to happen. but i think it's worth noting that, you know, whilst we were looking individual results, there's been quite a big dispersion in terms of what we've seen. natwest, you know, posting really, really good 17.5 return on tangible equity, but kind of with santander we've seen a contraction, a significant reduction in their annual profits driven by their kind of very narrow niche focus on principally the uk mortgage market. and i think, you know, one of the things we are seeing in terms of consolidation of focus is there is a benefit in bringing things together. and clearly the natwest business model is more diverse and having, you know, exposure to mortgages offsets some of the greater risks that come through having a large corporate book. so, you know, there would be some benefits in diversification

from such a transaction. but i think, you know, as noted, that's very much speculation. and i think we'd have to understand exactly what was proposed before we could comment more broadly. >> and hsbc. >> the other big name in focus today, reports around these job cuts coming. and we know that hsbc has been doing. >> you know. >> a ton of portfolio pruning. >> and trying to get its investment. >> bank in order. >> and it seems like. >> this is part of that larger strategy. how does hsbc fit into the uk landscape? >> so hsbc is, you know, announced this kind of greater focus on, on, on an east west division to really, i think maximize it's kind of strengths in, in both asia but also in its large kind of, you know uk home market as well. i think the key thing there, it really reflects the general trend we're seeing across large banking groups

globally to really try to focus in on where a bank is being successful and to maybe get rid of some more peripheral activities. so i think we expect that there is, you know, there's definitely scope for efficiency improvements. i think we were expecting based on the details revealed so far, of up to $300 million of improvements in terms of cost takeout from the revised hsbc plans. the ft story today clearly implies a much greater savings, so we'll have to see what hsbc have to say next week. but there's clear commitments from the group to remaining a kind of a globally diverse bank and to retain both the east and the west as part of their integrated strategy. >> simon, thank you for joining us this morning. simon ainsworth associate. >> managing director, moody's ratings. >> president trump's crackdown on small goods imports from china could have ramifications for london's listing environment. >> with. >> the financial times reporting that it could push sheen to

delay its bumper uk listing. the paper says the chinese retail giant's ipo will now likely be pushed back to the second half of the year. versus previous reports that it had told investors it was targeting an easter debut. shares in process, a major investor in tencent, are surging following a report. president xi jinping is set to chair a symposium attended by the country's business leaders aimed at boosting private sector sentiment. that is according to reuters. now, here's the kicker attendees are expected to include alibaba founder jack ma, as well as tencent and alibaba co-founder. and the reason that i say the real kicker, because jack ma has really fallen out of the spotlight. so it'll be fascinating to see him not only turn up at. >> the. >> symposium, but also to meet with president xi jinping. and there's just a lot of a lot of speculation around what that could mean. at this point, we are seeing. shares up nearly 6%. we've also seen a major rally in chinese tech stocks overnight.

the hong kong listed chinese tech stocks performing very well. major rally across alibaba up more than 6%. tencent they're up more than 7%. xiaomi and the overall hang seng tech index gaining nearly 6%. so a lot of focus on these reports around this potential event coming up. well still ahead on the show, he drove misses fourth quarter expectations and warns on president trump's tariff plans. we'll be speaking to the company's cfo, olaf kristoffersson, after this kristoffersson, after this break. (♪♪) now for something you can both agree on a sleep number® smart bed is perfectfor couples the climate360® smart bed is the only bed that cools and warms on each side and all our smart beds adjust the firmness for each of you. let's agree to agree on better sleep. and now, save 50% on the new

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(888) 710-0554. >> get tested. join the club. >> as a. >> woman. >> i wanted to experience financial independence and become financially independent in my retirement. >> join the club new member save with a special offer for a limited time at cnbc.com. terms and restrictions apply. >> welcome back to street signs. hydro posted adjusted core profit of 7.7 billion norwegian crowns in the fourth quarter. that's around double the level recorded a year ago, but below expectations on the back of higher costs and demand weakness, the aluminum producer said. president trump's planned tariffs will likely raise

premiums and costs in the us. trond olaf kristoffersen, the cfo of hydro, joins me now. trump, thank you so much for being with us. i'm going to cut right to it, because i think this is where the broader market is focused right now. and that is on the potential impact of tariffs from the us. right. in your statement today, toward the beginning, you note that as the us is a major aluminum importer, tariffs will likely raise premiums and costs. how do these tariffs affect you. >> well good. morning and. >> thanks. >> a lot for having me this morning. so on the tariff question the tariffs create an uncertainty in the market. but what we know and what has been decided so far is the 25% import duty on aluminum. >> into into the us. >> for us as a company is has very. limited impact on our operations and financials based on what has been decided so far. but but on the market side, we

see already that aluminum premiums. >> in the us. >> has reacted, and the current aluminum prices. >> in the. >> us is now mostly pricing in the 25% import. duty into the us. >> are you already. seeing a change in trade flows as a result of these tariff announcements? >> i think. >> it's a bit early to see the changes in trade flows, but but we are obviously looking at the implications and optimizing this on the ground in our operations. and i suspect that all other players are doing that. but fundamentally, the us is short on aluminum, and the aluminum prices in the us needs to react in order to attract the metal that the us needs. >> what you note that the us is, is short of aluminum. and, you know, president trump, his whole rationale for these tariffs is that he wants to draw investment into the us. is hydro considering building out more

capacity in the us? >> well. >> hydro is investing a lot in the us. our main focus in the us market is to invest in our aluminum extrusions activity and also the recycling activity in the us, and we have made a lot of investments over the last years, and we continue to plan to invest in the us going forward. >> in terms of those premiums, we see in your in your results today, you note that midwest premiums are already surging to the highest levels seen since april 2023. and again, this is before we've even seen the real impact of the tariffs come into play. how how high do you see those premiums potentially going? >> well, if you look at the duty cost now based on the current aluminum prices, we see a price level around 50 $0.50 on on top on the us price. and we are nearly there now. so we are pricing around 45. so the market is now pricing in the duties into the us market.

>> let me turn your attention to europe, where you have struggled somewhat on the back of weaker electric vehicle production and sales, and you've made some strategic changes as a result. already. back in november, announcing plans to phase out your battery and green hydrogen businesses. but it seems like weaker ev production and sales are still impacting your business. how? >> well the ev market is a very important and interesting growth market for us going forward. we still believe in the long transition towards electric vehicle in the market, but the transition has been postponed compared to what we saw some years back. but we still see that our customers are planning for new models, and we are entering into new contracts and preparing for a situation where the market rebounds. >> and in terms of your efficiency measures, one of the components of your results today that has investors attention is higher cost. so talk to us about what's going on on the cost

front. >> well we have some special one off effects on the on the cost side this this quarter. but generally we have seen at least over the past year some inflationary pressure. but that seems to be easing now in in our operations, what we are focusing on is to make our operations more efficient, especially now in the downturn for the downstream businesses. so we are taking measures in terms of improvements and also restructuring our downstream business depending on the market situation. but then we are also prepared when the market rebounds. >> john, let's conclude the conversation on a high note. you achieved your 2025 target of a 10% co2 emission reduction, one year ahead of schedule. this seems to be the result of switching from heavy fuel oil to natural gas. what next? now that you've hit that target ahead of schedule? >> well, we are very proud that we have been able to take out more than a million tonnes of annual co2 emissions in brazil through the investments in the

fuel switch project in our refinery in brazil. and then we are also at the last end of last year, also introduced using electrical boilers in this refinery to further reduce co2 emissions. and we are looking more into those types of investments to continue to take out co2 emissions long term. we are also investing heavily in r&d also to continue to take out the co2 from our operations in the long term. >> tran, thank you so much for sharing more detail with us this morning. tron olof christoffersen, cfo of hydro. switching gears to luxury french fashion house hermes reported surging sales at the end of the year. q4 revenue jumped much better than expected 17.6% to ■k73.96 billion, with the fastet growth coming from the americas and japan. montclair reported better than expected sales in the fourth quarter, boosted by double digit growth in china. the high end clothing maker posted a forecast beating 7%

jump in full year consolidated revenue to ■k73.1 billion. and montclair shares just a touch stronger this morning. hermes, meanwhile, seeing quite a strong share price reaction. let's start there, charlotte. break it down for us. hermes operates at the higher end of the luxury spectrum, in contrast to the likes of gucci. as we were talking about earlier this week, it seems like that consumer is really holding up pretty economically insensitive. >> yeah, absolutely. >> and again, we always. >> say. >> hermes are. >> kind of in a league of. >> their own. they have their own business. >> model where. >> there's more demand than supply. >> of course. >> that's helping. >> them. >> of. >> course. catering to the most affluent buyers. >> but you know. >> they did see a slowdown. >> in q3. of course. >> still a lot of demand. >> but there was a deceleration. but q4. >> really beating. >> expectations. >> very strong numbers there in. >> across the categories. >> and the regions. and they were saying that the americas is one of the areas where they've seen most acceleration. that's echoing some of the comments that we have from other luxury players that have already reported their numbers in the

americas. in q4. >> sales were. >> up 22% just in that region. in asia, we know. >> things are still difficult. >> in china. they still. see some. >> growth. >> up 9% in asia pacific. >> but they say they. see some. positive signs in. >> that. >> region. >> but they. >> don't see. >> a. >> turnaround just. yet and that it will take longer. so here again, something we. >> heard from lvmh where they said. >> it would take. >> a couple of. >> years before we see really the demand. >> coming back there. europe resilient up 17% and looking at the different segments. leather goods. >> of course, that. >> makes the. >> bulk. >> of their revenue and where they sell those very expensive bags, the birkin. or the kelly. their revenues up 21.5% in that segment. what's interesting to look at? silk and textiles, of course. >> this is seen. >> as a segment where they have the access to the most to the aspirational buyer with their scarves and the ties. and that was up just 7%. you can say just 7%. but compared to. >> the other. >> segments, you know, you do see that the aspirational buyer is still being squeezed. so somewhat there, but overall very strong performance across the board. they said they remain very positive for 2025, again.

>> because particularly. >> thanks to the us. interesting comment from the executive chair. >> this morning. >> they're saying that they're thinking of adding haute couture to their portfolio because of course they only have ready to wear. so they're looking in that area. that is part of the of course, the marketing strategy as well, which hermes always said they don't have a marketing department. so, you know, because they don't need it. exactly. we know that. and kelly or a birkin bag is a good investment in itself. there's a lot of demand. they have around 24 workshops. they try to open more workshops. they have 26 by 2026 because they have so much demand, and it takes a while to actually make those bags. they will handmade. >> it is amazing to have a strategy of no marketing because it just the bags just sell themselves. we heard that from tesla, but it's not working out that well at the moment. charlotte, what about watches at hermes? how is the watch division doing? >> so it's interesting because when that hasn't been performing as well, it's one that is actually down for the full year. so they saw things turning around in q4. and the executive chair this morning was saying that they're looking at making some investments in that

segment. but again, that's the segment that we know has been suffering for other luxury players as well. so it's interesting that they actually highlighted it in their. remember, they have also an agreement with apple to make some of the straps for the apple watch there. so you know there's they try to cater to the tech aspect of it. but yeah it is one that has been struggling more there. but they're making the investments. >> it's interesting when you look across these luxury names, it feels as though so many of these trends are really sector wide, that it's not a question of losing market share to competitors, but rather the aspirational consumer is where the challenge has been. is that the correct read? >> it is. it certainly is for a lot of the luxury players. and also because the strategy after the post-pandemic boom has been to hike prices, you know, they all talk about exclusivity and not being too available. and that's the trap where burberry and gucci fell recently. so you know, the strategy for that to counter that has been to hike prices. but as a result, then you've priced out the aspirational buyer and that the bridge to the aspirational buyer has turned to eyewear or makeup.

because you know, what used to be the entry item was the bag. but those bags have become so much more expensive now. >> extortionate. >> absolutely. >> yeah. well, charlotte, we could keep going, but we'll have to leave it there. we've got a break to take. coming up on the show, trump promises to include ukraine in peace talks as european leaders voice concerns over the negotiations. we'll have the latest developments after this do you have a life insurance policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. call coventry direct to learn more. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. our friend sold their policy to help pay their medical bills, and that got me thinking. maybe selling our policy could help with our retirement. i'm skeptical, so i did some research and called coventry direct. they explained life insurance is a valuable asset that can be sold. we learned we could sell all of our policy, or keep part of it with no future payments. who knew? we sold our policy. now we can relax and enjoy our retirement as we had

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your front door. did i send one to you? of the revenue streams are guaranteed. >> the countdown is on. cnbc sport official nba team valuations revealed today in squawk box. >> welcome back to street signs i'm julianna tatelbaum and these are your headlines. european equities line up their eighth straight week of gains, as investors appear to shrug off president trump's pledge to impose reciprocal tariffs. >> i have decided, for purposes of fairness, that i will charge a reciprocal tariff. in other words, they charge us a tax or a tariff, and we charge them the exact same tax or tariff. very simple.

>> in the bag. birkin maker hermes trades in the green on the back of a near 20% jump in fourth quarter sales, almost double analysts estimates. as the french luxury house continues to outshine its peers. natwest's guidance fails to win investors hearts this valentine's day, putting the stock in the red despite a full year profit beat. cfo katy murray sounds a positive note on the uk economy, though. >> we saw lending going up by around 3.5% and that really just demonstrates actually the customers are using their their money to invest in their businesses, invest in their homes. we do think that there are reasons for optimism as we move forward from here. >> president trump talks up the prospect of ukraine peace talks as officials gather at the munich security conference. but kyiv warns against any premature agreement with moscow. we have got some fresh reaction

right now from the european commission to president trump's announcement yesterday of reciprocal tariffs in motion. the european commission views trump's proposed reciprocal tariff trade policy as a step in the wrong direction. the eu remains committed to an open and predictable global trading system that benefits all partners. and here is the kicker. the eu will react firmly and immediately against unjustified barriers to free and fair trade. i think those are two key words, firmly and immediately, because there has been some question around what the eu response to new tariffs may look like and when. and here they are distinctly using the word immediately. so if we do see these tariffs come come through and we do see these reciprocal tariffs come to fruition. the eu is trying to push the us to get the message out that that they will be reacting firmly and immediately to what they see as unjustified barriers to free and fair trade.

now what's been interesting is since these new announcements came through yesterday, equity markets have been pretty resilient. so investors, it would seem, are taking the view that this is more of a negotiating tactic from president trump rather than an end game. and you can see that in trade. this morning we opened in the red modestly so. and now have been traveling higher. so the stoxx 600 the main benchmark is now up 11 basis points on the day. yes. it's not just tariffs in focus. there's plenty of earnings that we're looking at. but overall we are seeing a positive reaction in equities this morning in europe. now as for u.s. futures it's a mixed picture fairly fairly muted there as well. the s&p and the nasdaq are looking at a slight uptick in early trade. the dow jones looking to pull back ever so slightly. and this follows us markets holding up pretty well yesterday as well. major move in tech stocks yesterday. stateside. so a lot of drivers. but the overall message from markets is that they're they're holding steady right now. now

u.s. president donald trump says ukraine will be involved in peace negotiations with russia, suggesting three way talks at the munich security conference, which kyiv said are not expected. in an interview with the wall street journal, u.s. vice president j.d. vance, who is set to meet ukrainian president volodymyr zelenskyy in munich, warned of sanctions and potential military action against russia if president vladimir putin does not agree to a deal. trump has floated concessions from ukraine, including ruling out nato membership and ceding contested territory. but when asked what russia would give up in negotiations, the u.s. president didn't have a specific example. >> as far as the negotiation, it's too early to say what's going to happen. maybe russia will give up a lot. maybe they won't. and it's all dependent on what is going to happen. the negotiation really hasn't started. but i will say as far as nato is concerned, from many years before president putin, i will tell you that i've heard

that russia would never accept that. and i think ukraine knew that because ukraine wasn't in and never requested to be in until more recently. so that's the way it is. and i think that's the way it's going to have to be. >> ukraine's european allies have expressed concern following trump's announcement of immediate peace talks with leaders, stressing the need for key to be at the center of those negotiations. >> we have to. >> make sure that when talks start, ukraine is in the best possible position. and obviously this is about ukraine. so ukraine will be involved in any way in whatsoever. and at the same time, we are also in total agreement that an outcome has to be durable, as pete said. the secretary of defense said yesterday we cannot have a minsk three again. so whenever the outcome is there, we have to make sure that putin will not try to grab another square mile kilometer of ukraine. >> any agreement. >> without us will fail. >> because you need europe. >> and ukraine to also implement. >> the agreement. so without.

>> us at the table, you know you can agree on on whatever, but. >> it will just. >> simply fail. because of the implementation. >> is not there. >> any quick fix is a is a dirty deal that we have seen before when it comes to minsk, for example. and it will just simply not work. >> clearly a. >> peace. >> must hold in the long term. it must secure. >> the sovereignty of ukraine. so a dictated peace will never find. >> our support. >> we also will not. accept any solution. >> that leads. >> to a decoupling of american and european security. only one person would. >> benefit from that. president putin. >> elias joins me now senior analyst at prism strategic intelligence limited. thank you so much for being with us. there's so much to unpack here. and as we brace for the munich security conference to get underway in munich, and it feels like over the last week, this phone call between president trump and president putin has really rustled a lot of feathers

from kyiv to europe. and it caught many, many off guard. quite a different approach, obviously, to the biden administration. how is this phone call likely to shape the discussion around ukraine at the security conference? >> what a. >> dizzying week, indeed. this truly is a. >> pivotal moment in. >> post-cold war history. and i think it's safe to say that the call between trump and putin was truly unexpected. it has. and the us and western. policy more broadly, of trying to. >> isolate russia. >> for its full. >> scale invasion. of ukraine and. >> not holding a direct line with putin. the what happened in the aftermath of that call is that trump. >> has put. >> ukraine, but also europe, in a fairly precarious position. what has emerged over the past few days are signs of what trump is more likely to do in ukraine, which is putting the burden on ukraine rather than pressuring

russia to end this war. >> do you think that was an unintended consequence of this phone call? >> i think it was intended. right. what trump has essentially told to putin even before negotiations started, is that the us was prepared to give up all nearly all the concessions that russia has been demanding for the past three years, nearly. and what trump has said now is that this is ukraine's and europe's problem, not the us problem to solve. >> so where does that where does that leave europe? i mean, clearly in a really difficult predicament. as you say, they are already under pressure from the united states to spend more, but they all have their individual, you know, the countries within europe have their individual challenges in doing so. so what are europe's options? >> it does. >> leave europe in a tough spot. and european leaders at the munich security conference will be doing their best to ensure that they themselves, but also ukraine, are. not left out. this

crucial and crucial negotiations that are going to determine the security of the broader continent, right, not just ukraine and europe. so they will be doing their best to ensure that they're not left out of the conversations going forward. >> and what might this peace plan look like that the trump administration may be presenting to the security conference? >> well, so far, the signs and signals that we have seen from the trump administration have been quite divergent. right. so you had access in, in in brussels who said that you should not expect ukraine should not be expecting a return to pre 2014 borders, that ukraine would never join nato. and yet vice president j.d. vance, just in the past few hours, said that those options are still on the table should russia not negotiate in good faith. so while it does appear that trump is prepared to make to force ukraine to make major concessions to russia,

essentially delivering a win for putin, some of some of his some some people on his team are sending different signals so far. >> you talk about that as a potential win for president putin. and many are saying that the phone call itself is already a win for putin. he got a conversation with the us president. we know he likes to be on the global stage, and the call took place without zelensky. so ultimately, i mean, for putin, he's already won a peace anyway. >> indeed, this is a win for putin already. he is getting exactly what he wanted, which is not just to force ukraine to make concessions, but also getting to negotiate directly with the us, because that's what putin has been claiming for years now. this is not a war between russia and ukraine. this is a proxy war by the united states and its allies. and russia on the other side. >> now looking to nato, trump has been calling for europe for years to spend more that he wants, that the allies to spend 5% of gdp on defense. germany is

already struggling to meet the 2% target that the 2% minimum requirement that's already in place from nato. how realistic is it that we are going to see that kind of step up in spending? >> so here it is in a fairly tough spot now. it certainly has had years to prepare for this worst moment. and it has come. and i think the reality is that it is going to take quite a bit of time for europe to be able to catch up and defend itself. not only because of supply chain bottlenecks, but also growing political fragmentation within the eu itself. right. >> well, you know, it's interesting you mentioned political fragmentation within the eu because i wanted to ask you about national populism within countries. so it's not even just the eu level, but within countries. we've got the german election coming up and national populism is on the rise. so do you see support for institutions like nato waning from europe as a result of what they're getting from their constituents? >> we may very well see support

for nato and brussels and the eu itself wane in the coming years. and it remains to be seen what the outcome of those elections is. >> let me ask you about greenland while we've got you. what about trump's bid for greenland? how might that feature, do you think, at the munich security conference? >> well, one might think that ukraine's offer of its own mineral wealth is going to let greenland off the hook this time around. so. but, but but i am certain that greenland and europe in general are quite concerned going into the munich security conference, given trump's remarks. >> all right. we'll leave it there. thank you for joining us today. elias senior analyst, prism strategic intelligence limited. tiktok is back in app stores in the us after it was removed in january. president trump granted the chinese owned app a reprieve, granting it 75 days to comply with a law banning the app if it is not sold, according to bloomberg.

the app returned after apple and google received assurances they would not be punished for allowing downloads. apple is set to launch its new iphone se in the coming days, and it could hit the shelves later this month. the long awaited revamp of the low cost model is expected to look more like the iphone 14, and include the company's ai offering. apple intelligence ceo tim cook teased the launch could come on february 19th in a post on x. arm is reportedly set to launch a chip of its own this year, with meta on the books to be one of its first customers. that's according to the financial times, which says the firm's ceo, rene haas, will unveil the chip as soon as this summer. the move would represent a pivot in arm's business model, which currently relies on licensing blueprints to tech giants. shares jumped around 6% on the report. meanwhile, softbank, which owns almost 90% of the company, is also trading higher in japan. softbank has also invested heavily in openai.

speaking to cnbc in paris, softbank chief legal and compliance officer tim mackey said that the company believes in the ai startup. >> we are looking into it. i don't know right now. you know, elon musk and his conversation with openai, that's a conversation between them and openai, not necessarily a softbank question. >> and in terms of open ai's broader support to turn into a for profit structure, yes. is that something that softbank is supporting? >> well, i mean, well, we're certainly monitoring it as things go on. and you know we'll see how it goes. it's you know i mean support we're they're our partners. we hope that they're successful. we've invested you know in two tranches. we've done about $2 billion investment in the company. and you know, we believe in it. and masa believes in it. >> coming up on the program, india's narendra modi becomes the latest world leader to meet president trump with trade tensions in focus. we'll bring you the latest next.

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restrictions apply. >> as we approach the end of the program, here are four things to get you up to speed ahead of the open on wall street. january retail sales will round off a busy week of data in the us. we'll hear from dallas fed president lorie logan wrapping up this week's fed speak, which also saw chair jerome powell testify on the hill. the munich security conference begins at us vice president jd vance leading the us delegation. and it's valentine's day. but soaring cocoa prices could put a dampener on the day, with research suggesting consumers must pay 10 to 20% more for chocolate this year. sad days. indian prime minister narendra modi is the latest world leader to meet president trump. modi has more on the visit. >> president trump and prime minister modi meeting at the white house today, where trade was top of mind. us india trade deficit is the 10th largest and has been growing in recent

years. i'm told modi presented a menu of tariff concessions in his meeting, and a willingness to buy more u.s. defense equipment and energy, specifically liquefied natural gas. the goal of today's meeting, i'm told, was to reaffirm the us india relationship and lay the groundwork to a deal that would then be officially announced when trump is expected to visit india later this year. >> today, the prime minister and i are announcing a framework to strengthen those ties even further economically, and the us india compact for the 21st century is a historic initiative that will deepen every aspect of our partnership and our friendship. >> trump was known for having a good relationship with the country and modi during his first term, seeing the country as an important partner in fending off competition from china. the indian leader also spent time with elon musk today, where the two discussed expanding starlink into the country, collaborating on artificial intelligence and sourcing materials from india to power tesla's gigafactory plant. new delhi, i'm told, also

requested the country to be exempt from forthcoming export controls that would make it harder to obtain nvidias most powerful chips. those rules are expected to go into effect this spring. trump has the power to change that. for cnbc business news i'm seema mody. >> molly. emerging markets economist at j. safra sarasin sustainable asset management joins me now. molly grerocal tariffs, which emerging market economies are at the greatest risk of being impacted by these tariffs. >> if you look at it at the. economy level. >> the economy. >> is at our most exposed, most exposed in terms of exports to. >> the us. >> or mexico. >> vietnam and. >> but mexico. >> also is in. >> the usmca. >> so many of the tariffs rates. >> are actually lower than what it appears to. be in terms of the overall tariffs. we are

looking. >> at vietnam. >> which is exposed to the. >> us by 25% or more than 20% of its. >> exports to gdp. >> so we are talking about, you know, a pretty substantial exposure. >> and what about india? the tariff rate differential is pretty vast there i believe about ten percentage points. so what does india stand to lose if these reciprocal tariffs come into play? >> india exports a lot of pharmaceuticals electronics. >> to the us. >> so if you look at the. >> rate at. >> which india charges. >> the us in. >> terms of the pharmaceutical, for example, for. >> medicines, that's 10%. >> so we. >> are talking about, you know, 10% on medicines going to the us at this point, which could be quite substantial. >> for the pharmaceutical. >> industry in india. >> but india's export to. >> gdp is. >> not very large. >> so the impact. >> on the overall.

>> economy will not be very big. >> does that make it less likely that modi will offer concessions to try to negotiate with president trump? >> i think. >> the fact. >> that, you. >> know, we. >> have still some time until the spring. >> for all. >> the countries. to actually look at their tariffs rates and. >> also. >> you know, think about what they could lose and negotiate with the us. i think there is still some time. >> for, you. >> know, this. negotiation to happen. and, you know, that could be the case. >> trump also said that the trade deficit with india could be addressed with the sale of oil and gas. is that an area where we could see some negotiation? india turning to the us for its energy needs more than it does right now, where it's, you know, fairly dependent on russia for its energy needs. >> yes. >> that could be possible because india is an. energy importer. >> and it could still, you know,

pivot to import more from the us instead of from other sources. >> and the european commission is preparing a trip trade deal with modi's government. how significant would a trade deal be between the eu and india? >> i think at this. >> point. >> you know, many countries are trying. >> to expand their. >> trade and expand their markets outside of the us, just to make sure that you can still have, you know, the export markets outside of the us in case you. are slapped with more tariffs at this point. so i think it is and this is what everybody is trying to do at this point. >> and when it comes to modeling the impact of these potential tariffs not just for india, but obviously india in focus with modi's visit to the us, but across the emerging markets. when there's so much uncertainty, how do you deal with this? from an economic

modeling perspective? >> i think from. you already have the, you know, the confidence impact. so if you're an exporter at this point, you will try to diversify. you will try to think about, you know, what to do. you will have to factor in the exchange rate development. so there are so many factors that are quite uncertain that it might basically make, you know, trade basically becoming much weaker at this point. >> that's got to be a pretty daunting prospect for a lot of these emerging economies. do you see any of them coming to the table in a material way, trying to change their tariff and tax regimes to avoid these reciprocal tariffs hitting them? >> i mean. >> if you think about it, this could be because it's in the memo that was sent out on the on the tariffs. it's not very clear

how exactly it is going to be implemented. it could be a very complicated task if you do it by product, because there are some 5000 products out there. or you do it by categories, then, you know, it really depends on what you are looking at in terms of, for example, if you give an example, you know, for vietnam, it's tariffs on computer, which is a main export to the us is zero. it's tariffs on footwear or you know, on sneakers is actually 30%, which is also another main export to the us. so you have like you know a very big mix mixture of, of goods and rates that you have to determine from the us side on what exactly you would like to put on the table. and i think it's going to be an ongoing process to negotiate between these countries and the us. >> molly, thanks for your expertise. molly cole, emerging markets economist at j. safra sarasin, sustainable asset

management. i want to bring you some fresh lines now out of the uk prime minister, ahead of the munich security conference. he's saying that ukraine president unequivocal there would be no talks about ukraine without ukraine. this is what he's told the ukraine president. the ukraine needs strong security guarantees, further lethal aid and a sovereign future. that's in a statement from keir starmer's office ahead of this security meeting. you can see there live shots from munich, where no doubt ukraine will be a central piece of the conversation with the international community. shocked by the phone call that took place between president trump and president putin earlier this week, a phone call that took place without ukraine and without europe, without the european union represented. so european union in difficult position. now, as we head into the munich security conference this weekend, we'll have live coverage there on monday. so do stay with us for that. for now, though, let's turn back to

european equity markets this morning. we started out in the red. things have turned more positive over the course of the morning, the xetra dax trading a touch below the flat line. but for the week it's been quite a strong run for german equities, up 3.8% coming into today. the dax is the best performing major equity index of 2025. there you have the week to date moves for european equities 3.7% now for the dax. after the modest pullback today footsie over in italy up 2.5% ftse 100 also higher on the week. so quite a strong run for european equity markets despite all the uncertainty around tariffs u.s. futures a little soggy at the moment. stay tuned. the us is going to take you through all of the lead up to the market open. i'm julianna tatelbaum. worldwide exchange is up next. >> they are trying to shut down this legal loophole to get 100mg generic viagra, or 20mg generic cialis, delivered to your door

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