have james stewart here. there. old bud and rival chad reed came along for a chat as well, and seven time winner eli tomac. unreal night here in daytona. congratulations to kickstart kenny roczen. he's a daytona winner. finally. >> yes. >> a very good morning to you. and welcome to street signs i'm. >> julianna tatelbaum and. these are your headlines. >> opening salvo. >> defense names skyrocket. >> in early trade. >> as. >> investors eye. >> pledges for more spending. >> from. >> europe's largest economies. putting the stocks. >> aerospace and defense index on. >> track for its. >> best. >> day since 2020. >> this after uk prime minister keir starmer calls. >> for a. >> coalition of the willing as. >> talks between the u.s. and. >> ukraine dramatically. >> collapse. >> leaving ukrainians.

>> reeling about the future. >> of the war. >> the discussions. we've had today, particularly the coalition. >> of the. >> willing. >> is on the. >> basis that. >> this is a plan. >> that. >> we will work with. >> with the us. >> and that it. >> will have us. >> backing investment. >> into secure networks. and 5g are front and center at the mobile world congress, with. >> nokia's outgoing ceo pekka lundmark telling cnbc. europe is scaling up. >> we acquired. >> the us company phoenix. >> last year. >> and we have integrated their tactical communications. >> offering to our 5g. >> platform, and we are now offering. >> 5g as a platform. >> for. tactical communications for defense. >> forces. >> and us futures tread water as investors seek clarity on president trump's. >> plan to. >> impose tariffs. >> on canada, mexico and china this week, while the white house launches a probe into the lumber market.

>> welcome to street signs, everybody. our top. >> story this morning uk prime. >> minister keir starmer says european. leaders have. agreed to draw up a plan for. >> peace in ukraine to present. >> to the united states. >> starmer said countries, including. >> the uk and france would join others in a, quote. >> coalition of the willing to contribute military support to defend any future ceasefire agreement. they will also raise defense spending, with the prime minister announcing an additional 1.6 billion pounds of uk export finance for ukraine to buy air defense missiles. speaking to newspaper le figaro, french president emmanuel macron said the plan would include an initial one month partial truce between russia and ukraine covering air, sea and energy infrastructure. starmer said he's confident the plan would win the support of president trump. >> a reliable ally.

>> to the. >> uk for. >> many. >> many decades. >> and continues. >> to be. >> there are no two countries. >> as closely aligned. >> as our two countries. >> and our defense. >> our security and intelligence. >> is intertwined in a way. >> no. >> two other countries. >> are. so it's an important and reliable ally. >> for us. the discussions. >> we have. >> had today, particularly the coalition. >> of the. >> willing. >> is on the. >> basis that. >> this. is a plan. >> that. >> we will work with. with the us. and that. >> it will. >> have us backing. >> now, italian prime minister giorgia meloni met starmer ahead of the summit, calling for unity. >> we are all very committed. >> about a. >> goal that we. >> all want to achieve. >> which is a just. >> and lasting peace. >> in ukraine, and i think it is very. >> very important that we. >> avoid the risk that the west divides. >> and i think on this, uk and italy can play an important.

role in bridge building. >> let's say. >> yeah. >> so you know that i've been also proposing a meeting between us and european leaders. for if we divide. >> ourselves. >> that will make us all weaker. >> european nations have pledged to step up defense spending after a public breakdown in relations between the us and ukraine. uk prime minister keir starmer announced an additional 1.6 billion pounds of uk export finance for ukraine to buy air defense missiles, with the uk government also planning to change the remit of its 27.8 billion pound wealth fund so it can be spent on defense. french president emmanuel macron, meanwhile, called on europeans to dramatically increase their defense spending to more than 3% of gdp. reuters has reported that german political parties in coalition talks have considered a special defense fund worth as much as ■k7400 billion. while al of this is putting more fire under these defense names in europe, you can see on your

screen. another major step higher for some key defense stocks hensoldt up another 20% this morning alone. ryan metall up 10%. leonardo up 10%. up 14%. and this is not the first day these stocks have been on an absolute tear on the expectation of more defense spending out of europe. now european leaders will meet again on thursday for an emergency defense focused summit in brussels. and sylvia will be covering that summit. and she's here in studio with us for more. so, sylvia, talk us through what we can expect. what's next from european leaders? we've had this summit now in london. not a lot of concrete conclusions have come from that summit. it seems like all eyes now are on. >> this next one. >> for sure. >> we're going to have the 27 eu leaders meeting in brussels on thursday, and one eu official was telling me earlier that we. >> should expect. >> concrete deliverables, in particular when it comes to the financing. of the fence. this is very, very important. the same official suggested that on top of flexibility in the fiscal

rules, which was announced. by european commission president in february, we should be looking also at additional funding sources for the fans. on top of that, the same official said that there will be an adaptation of the mandate of the european investment bank, so it can also boost support for the sector. worth keeping in mind context here that the european investment bank can only support projects that have some sort of defense angle if it has a dual mandate, a dual mandate there. let's see what's going to happen, what how they're going to adapt the role of the european investment bank. but no doubt that the pressure is on for european leaders. they know they need to spend more on defense. the question for thursday is how are they going to do that? and indeed, it is important to look at the comments at the language from brussels thus far. and it is actually leading to suggest that there will be concrete announcements. so that's an important one. the second discussion on thursday is going

to be on concrete support for ukraine. what sort of security guarantees can the europeans give to ukraine in the short term? that could also lead to the end of the war. again, president zelenskyy has been invited. let's see what he's also going to tell to european leaders. but there's no doubt, juliana, a sense of urgency here. the europeans have realized that they need to do more. they they have said that repeatedly. and at this stage, it does seem that we are moving toward some sort of concrete announcements on that front, particularly on financing. let's see what they're going to say. i'll just make one final point here that the president of european commission, ursula von der leyen, is expected to publish a letter early this week. one official suggested that could happen as early as today. exactly. giving the leaders a bit of a roadmap in terms of how they can spend more on defense as well. >> i think looking at the summit in london, there was a question going into it whether the message coming out would be one of, you know, condemning the

events in the oval office on friday. that wasn't the message. starmer came out very clearly saying that the europeans want to work with the united states, and the europeans are working on the basis that they're going to ramp up defense spending in order to appease the us request for more or demand really for more support. and the europeans are essentially saying we continue to need your backing from the us. and what do you make of that? the europeans are moving forward to essentially spend more so that the us doesn't walk away. >> they do not want the us to walk away. they realize that they needed the us in order, not just, you know, for the future of security for the continent, but also for ukraine itself. they realize they can't do that alone. and for a long time, juliana, we have conversations here suggesting how, you know, the europeans have actually realized that they are no longer at the table for conversations on how to come to an end of the war. so they're doing a lot in that regard to make sure that they are having those conversations. they are part of

those conversations. but it is indeed very important to see that they do not want to make donald trump angry about this. they want to come to a solution with the united states and the language from keir starmer, the prime minister of the uk. and the french president is very telling in that regard. their conversations in washington, dc was also very important in that regard. and here it's also important from a european perspective to look at who is the leader. you know, leading this conversation in terms of european security. >> well, i think that's you know, it's interesting that you raised that point because this summit took place in the uk this past weekend. the uk is not a member of the european union anymore. what are the significance of having it here in that it's not the eu that's coming together. it's european countries, it's countries in support of the ukraine. and that could be positive for getting things done more quickly because it's not an eu question. it's individual governments coming together. and it could potentially mean that we don't see, you know, the likes of

hungary potentially vetoing more support for the ukraine. it seems like this could be an easier path to more support, more quickly to see this effort from individual countries rather than as an eu entity. >> let's just say that the eu 27, they are very happy that keir starmer is taking this role and they are witnessing we had already witnessed this, a bit of a change in narrative and in relationship between the uk and the eu, but now that is even more clear. the fact that the summit took place in london, the fact that you see a lot of phone calls between starmer and macron, maloney, they're all trying to get involved here and they want the uk to be part of this. no doubt the uk has already said they're going to be spending 2.5% of gdp in defense. now it's up to the us as a whole to announce something more concrete. i'll just make one final point here that when you think about the eu, the pressure there and there and the fact that they need to announce concrete things on defense, it is very hard for the eu to achieve that from the point of view that some eu nations are

not nato nations, they do not want to have an increased military spending, or they do not want to have to change their neutrality policy as well. i'm talking about austria. i'm talking about even about switzerland, which is not in the eu. so let's see how the eu will, you know, manage all of these conversations, what they will say on thursday. but i think that technicality is also important to keep in mind when people criticize what the eu is doing or not doing. >> a fascinating new role for keir starmer, one that i think he's very, very pleased to have. sylvia, thanks for bringing us up to speed on everything around the european perspective here. now, turning back to markets, we are looking at the stoxx 600 year to date because i think it's this is or this is the stoxx 600 over the last week up 9/10 of a percent. we've got ten weeks in a row of positive gains for the stoxx 600. so year to date there you have it 10% higher on a year to date basis outperforming the us market and

a huge demand for these defense names in europe this morning. looking at the broader european market today, we are seeing strong gains in defense, which is driving up the industrial sector more broadly. overall, footsie 100, xetra, dax and the cac40 are all higher this morning. footsie trading slightly lower. from a sector perspective i mentioned defense. we've got industrials out in front. it is those defense names that are driving those gains. oil and gas also doing well. technology basic resources and healthcare. on the downside the sector laggards this morning. here's a look for you. we've got utilities real estate retail chemicals down utilities. the real underperforming down about 1.3%. so that's the picture for european markets. fairly muted reaction when you think about the drama that we all witnessed in the oval office on friday christian miller glassman joins me now head of asset allocation research at goldman sachs. great to have you on the program and see you once again. we are also focused on the geopolitics this morning after the events of the

weekend. from a market perspective, what do you think about the implications, the biggest risks around this escalation in tension between the us and ukraine and in turn, the reaction from europe? >> yeah. >> i mean. >> geopolitics are. always very tough to work into markets. >> and i think the. >> most important thing to keep in mind is risk premia are very low. i think when we came into the year, the market was very excited about us. exceptionalism was very excited about potential tailwinds for growth. and this really continued over the last few weeks where even broadened out. you could say, i think europe has done very well. china has done very well. so geopolitics come into an environment of very tight risk, premium increase uncertainty. but i think investors generally struggle to price it as it kind of unfolds until you really have tangible actions, tangible results. so it creates a vulnerability, a latent risk, you could say currently in the market. but the best thing you

can do as an asset allocator is diversify, not to aggressively over kind of change market time and these type of things. >> what do you think of that outperformance of europe and china versus the us? do you think it's justified? >> i think what's interesting is everybody focuses on europe and china doing better in function of the german elections, driving fiscal spending and function of a russia ukraine deal. obviously in china, the optimism is a lot about ai and potential deep sea benefits. but i think we also have to acknowledge that the us data has been weaker. if you look at us macro surprises, if you look at really high frequency indicators, not all of them the best quality, some of them are softer kind of survey data, but we've seen a real deceleration in terms of the us growth momentum. so i think this idea that returns and capital are broadening out is the right idea. we've certainly been in favor of that. the problem is the speed, as always, because people were so bearish on europe, people were so bearish

on china, like the rally you've seen has been very fast. and that always scares institutional investors from participating, because there's a concern that you overshot because of technicals. >> do you think that's happening with defense names here? i mean, every day we come in and in europe we've seen double digit gains for so many of these defense stocks. is there concern from institutional you know, some of these perhaps long term investors that this is actually just a really crowded trade now perhaps driven up by a lot of hedge funds. is that part of the conversation? >> it's very complex because defense is a very kind of it's a national security issue. so to treat those companies and price those companies based on the news flow we currently have on defense spending, etcetera, is increasingly more difficult. i'm not a defense expert, you could say on defense stocks, but what i would say is in the us, for example, for a lot of defense stocks, the revenue is actually or the roe is determined by the government. so you have to be a bit careful about how to price those type of stocks. so i

cannot say if they overshot or not. i mean, we clearly see positive momentum behind defense spending. but the problem is always when you have such a big regime shift. now with regards to defense and defense spending, these companies might change how they make money and how they get integrated into the kind of fabric of, of national security. so i would say, listen, i understand why they rally a lot. there will be a lot more spending on defense, and it's going to be a multi-year process. so you get predictability of cash flows, potentially predictability of earnings. i'm sure that that this contributes to people being willing to pay higher multiples. >> and given the valuation discount, because so previously so many esg funds wouldn't touch those defense names with a barge pole. and now suddenly it's become the completely, you know, a completely different paradigm where it's actually seen as esg friendly to be investing in some of these defense names. let me come back to your point about the unwind we've seen in the us. we've seen us tech really take a turn for the worse. we had. the nasdaq recorded its worst weekly performance since september last

week. the big seven now in correction territory. where are we in that unwind? is there more of an unwind to come? >> i think it's another really good point you make there. so you had the us kind of macro data taking a bit of a weaker turn. and we have a really important week this week. now we've got labor market data the ism. but you're right. the other thing that happened was of course the i kind of revolution taking a bit of a back seat. that's partially because of deep sea, but it's also partially because of the surprises that the magnificent seven are delivering, being smaller. and the market might have kind of paid for these potential surprises ahead. and now they don't materialize. so you get a bit of a kind of repricing. i think if you look at a lot of the back seven, they have really been treading water now for a year or so. so there's a proper consolidation on on valuations on those names. and what i always say is like it's not like in a tech bubble where those names were unprofitable, not kind of good companies generating cash flow. they

actually have a lower bound. so i would say that if there is a continued correction, they will find their feet because they already have very good arteries. even if you take the capex away, if you take the concerns that are there already, they're already very good businesses. so that makes us not worried that you're going through a multi-month multi-quarter kind of correction for those names. so i always look at like the return on equity as the most important driver of their valuations currently. and the return on equity is holding up as of now. so that should provide a bit of a lower bound. >> a bit of a floor there. let me ask about tariff risk because we are now hours away. if the trump administration goes ahead with tariffs on mexico, canada and these additional levies on china, how do you hedge against tariff risk? >> listen, i think, as i said, the first kind of rule for geopolitical risk and asset allocation is diversification. and what we've been advocating is just having balance between equities and bonds already helps. and it did. i think if you look at the tariff

announcements, the bond market buffer, those. and if you look at the last few weeks of volatility, the bond market actually helped you with that. and the problem is the bond market has rallied quite a bit now. and there's also question marks with the fiscal spending in europe, what that means for longer dated yields in europe. so from that perspective you need to broaden your hedges, broaden your diversification. we've been very focused on gold and gold actually in the last week or so has not really moved much. yeah. but before it really reacted a lot to tariffs. so we do think there's still upside on gold. and also the dollar i know the dollar becomes a different story now with what we discussed earlier with like the rest of the world looking better. but but you want to look at safe haven fx for example, one currency which hasn't done anything for the last nine months is the swiss franc. but but our team has looked a lot into the impact of tariffs on switzerland, and might actually be lower than than what you get for the eu or for a lot of other countries. >> okay, that's an interesting trade. well, christian, glad to have you on this morning as

always. christian miller glassman head of asset allocation research at goldman sachs. now turning to the us data. a us pce inflation came in at 2.5% on the year in january, up 30 basis points on the month as expected. meanwhile, core inflation eased to 2.6% on the year, down from 2.9% in december. china's manufacturing activity grew at the fastest pace in three months in february, thanks to new orders and higher purchase volumes. the official manufacturing pmi came in at 50.2 last month, up from 49.1 in january. a private survey also showed growth, with the manufacturing pmi rising to 50.8. the annual meeting of the chinese people's political consultative conference. that's a mouthful, starts on tuesday. that will be followed by the opening of the national people's congress, where investors will be looking out for growth and fiscal deficit targets seen at five and 4%, respectively. coming up on the show, we'll take a look inside l'oreal's newest research and innovation center. as the ceo tells

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>> experience the power of cnbc pro. track your portfolio from every angle on one optimized platform. become a smarter investor with the power of cnbc pro. go to cnbc.com now. >> welcome back to street signs. prada is reportedly moving closer to a deal to buy versace from capri holdings. that's according to bloomberg, which says the deal could be worth nearly ■k71.5 billion. the italn luxury house is reportedly looking to finalize the acquisition this month. l'oreal has opened its largest research and innovation center outside of france in the us. ceo nicola hieronimus told cnbc that the cosmetics giant wanted to expand its beauty offerings and invent new formulas that could serve a wider variety of customers. will charlotte's fresh back from this trip stateside? charlotte, talk

to us about the kind of innovation and the focus of l'oreal here? >> yeah, that. >> was really interesting to have a tour there. >> on inauguration. >> day of this big facility because, of course, l'oreal, they've been present in new jersey for a while. but this new research and innovation. >> center. >> l'oreal, invested $160 million to revamp this facility. so there's significant investment in one facility in the history of l'oreal. >> and. >> you know, the diversity that they have in the us market allows them to do a lot of that research there, whether it's on different types of skin, different types of hair. and they have hundreds of scientists all there in that massive lab that do all that research. >> kind of state of the art kind. >> of lab that they have there. so i had a chance to catch up exclusively with the ceo of l'oreal, nicola geronimo, to talk about innovation and why it's key to stay on top of the beauty business. >> people don't. >> tell you. >> that they. >> need a new glossy. lipstick or a new hair color that shines. >> they they. >> they need to be stimulated. >> the demand needs to be stimulated by innovation. >> you know, every year.

>> we our. >> business is. >> made 10. >> to. >> 15% of our business. >> comes from from new products. and you have constantly to. surprise and delight the consumer. >> and that's. >> what. >> we are doing here. >> and that's the way. >> to keep the market dynamic. the market, the beauty market has been growing. >> forever because people. >> need beauty. >> but they have to. >> be surprised. >> and we put on, you know, right now we're launching. >> a new haircare line on survey. >> and line that's been developed in these very labs, and. >> that's something that's going. >> bring something new to the market. >> and that's going. >> to hopefully delight our consumers and. >> and contribute to the. >> growth of the market. >> and to its leader, l'oreal. >> so it's. >> very interesting. >> to hear about, you know, how the beauty industry has changed, not just lipsticks anymore. there's a real shift, you know, to prevention, diagnosis, tailor made products and skincare routines. you know, it's really much going in that direction. laura has been investing lots of startups as well. you find them at ces. >> in las vegas. >> in vivatech in paris, you know, tech conferences, because

they have been pushing in that area a lot and looking at the us for them to see it as a growth opportunity market. i have a smaller market share than in other regions like in europe. so that's why also the investing in that region, because they see growth opportunity there and they're very upbeat for that market in 2025. but there is a question of tariffs and there is some uncertainty out there. so again when i asked nicolas hieronimus about the potential impact of tariffs, said look we. are mainly producing locally, but there could be some impact on supply chain and also some of the luxury items that are still produced in europe. we say overall tariffs are not good for business. >> tariff wars are never good. >> and in the end. >> they're not good for. >> the consumer because. it's the consumer. >> that ends up. >> paying one. >> way or another for. >> for tariffs. >> as far as laura is concerned. i mean, considering. >> the information. >> we have today. >> because it's. >> it's changing. >> regularly. >> i'm not overly concerned. >> first of all, as you. >> said. we produce.

>> more than. half of the business we do in. >> the us. in the us. >> actually. >> we're a net exporter. >> from the us. >> we sell. more outside. >> the us than we import. we manufacture. >> some. >> of our. >> products in mexico and canada, but overall it's. it's mostly a. >> us in mass. >> it's mostly us manufactured. and the brand. >> like. >> cerave. >> which is one of our biggest global brands, is made here in the usa. >> it's true that. >> we import luxury fragrances. >> we export. >> from europe. >> to. >> the us. >> right now. there's no. tariff on this category. should there be one? well, we will work. >> around it. >> there's pricing power. there's also the currency effect. the dollar is stronger, so. >> i think it is manageable. >> as long as it doesn't become, you know, a global. >> tit for tat tariff scenario. >> again, nicola. >> is the ceo of l'oreal speaking exclusively to cnbc. and again, very upbeat about the prospects in the us and helping them offset a little bit. still,

the slowdown that we see in china, they don't see things improving just yet. and looking at europe they say, look, this is crunch time. now we're talking about the competitiveness of europe. and again, comparing to the us saying trump back in the white house is big. focus on competitiveness and say europe really needs to get that wake up call that we. >> have from. >> the draghi report, say focus less on regulation, more on supporting innovation. that was. >> really one of his key messages. >> yeah, absolutely. and it was. >> also i think, you know, it was interesting to hear him say essentially nobody raises their hand and says i need a new lipstick to do this, you know, new thing. it's all about stimulating demand. in other words, the beauty industry, like l'oreal just telling consumers this is a new product that you need to add to your resume. it's quite a marketing. >> and interesting. for example, i have a skincare routine. has changed, you know, serums. >> and things like that. >> it's a step that didn't exist a few. years back, and now it's certainly. >> one of. >> the steps in the beauty in your beauty routine. and so to say, this is all these things that i bring to the table and get a big emphasis on prevention and diagnosis. >> and that's the kind of products that they're trying. >> to innovate and create in

this lab. >> well, charlotte, fascinating. i can't wait to see the full tour of that lab. looks really, really interesting. for now though, we are going to take a quick break. coming up on the show. ai and 5g are top of the agenda at the mobile world congress. we'll have more from our team on the ground there next. >> they are trying to shut down. >> this legal loophole. >> to get 100mg. >> generic viagra. >> or 20mg. >> generic cialis, delivered to your door for just $0.87 in less than two minutes. do this. first, scan the qr code to. >> go to. >> get friday plans. then you select if you need generic viagra or cialis. >> the quantity you need. >> and the dosage. i'll pick 100 milligram. thank you very much. >> and then their system will. >> see if you qualify. >> give it a second to. >> find the best deals. and boom

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old housekeeper home aglow. tackled everything from our kitchen to our bathroom, all our laundry. you just pick a date, pick a cleaner, and enjoy a spotless house for $19. >> for me, squawk box. is breakfast with most interesting. people in. >> the world. >> it's a privilege. >> to. >> get to talk. >> to them. >> every day. >> it's more entertaining than any other morning show, but you might get some useful information. >> squawk box weekday mornings, 6 a.m. eastern. cnbc. >> welcome back to street signs. i'm julianna tatelbaum, and these are your headlines. opening salvo defense names skyrocket in early trade as investors eye pledges for more spending from europe's largest economies, putting the stocks aerospace and defense index on track for its best day since 2020. this after uk prime minister keir starmer calls for a coalition of the willing as talks between the us and ukraine

dramatically collapse, leaving ukrainians reeling about the future of the war. >> the discussions. >> we've had today. >> particularly the coalition. >> of the. >> willing. >> is on the basis. that this is a plan. >> that. >> we will work. >> with, with. >> the us and that. >> it will have us backing. >> investment in innovation is front and center here at mobile world congress in barcelona, with the ericsson ceo telling cnbc europe needs to be more competitive. >> we compete. >> with. >> you know, huawei, zte. >> also here in europe. >> they are our. >> fiercest competitor already today. >> so. >> i wouldn't say that europe has decided where they're going to be on this map. i think that that kind of still remains an open question. >> and us futures tread water as investors seek clarity on president trump's plans to impose tariffs on canada, mexico and china this week, while the white house launches a probe into the lumber market. we'll have more with a former trump

administration official, kelly ann shaw, later this hour. so european markets this morning, reacting to the collapse in relations between the us and ukraine and europe's response to it, and so far the reaction has been fairly muted. you've got some green on the board for the uk market. the xetra, dax, the cac40 are all trading higher. footsie also up by about 16 basis points or so this morning. we are seeing continued massive demand for the defense names in europe. we've just seen these names move from strength to strength. we'll give you a look at some of the key movers this morning. you've got baa systems up 13.5%. taylor's up a further 13%. dassault aviation leonardo. and the names continue beyond this list. here. we're just seeing incredibly strong demand for these defense

names. the market had been underappreciating these names and they were trading at a discount before the escalation in tensions around ukraine. previously, over the last several years, esg funds didn't want to touch these names. now that whole paradigm is changing, and we're seeing esg funds turn toward these defense names. we're seeing short term investors turn toward them. just massive momentum around these names, as it seems very clear that europeans are committed to more defense spending. how much and how they will fund it remain key open questions. we'll hopefully get some more color on that later in the week, with a key summit taking place in brussels, but investors aren't waiting for details. they're putting money to work now. as for u.s. futures, here's a look at where wall street is poised to open. you've got some green on the board there as well. the nasdaq looking to open about 62 points higher. the dow jones and the s&p also looking to open higher. this follows a broad based rally on friday stateside where the nasdaq, the s&p and the dow all gained more than 1%. all 11 sectors in the market

were actually positive. it is a big week this week, with president trump due to deliver his first address to congress. we've also got the nfp report coming out later in the week. and of course, as i mentioned, that special summit in brussels, that's going to be key from a european defense perspective. now, in crypto markets, we're seeing a major rally after us president donald trump said on a truth social post on sunday that xrp. solana, cardano, bitcoin and ether would be included in the nation's new strategic crypto reserve. the names had previously not been announced. all five digital assets spiked with bitcoin surging as much as 11% were up about 9% in the latest trade. now, sticking with the tech sector, karen joins us from the mobile world congress in barcelona, which starts today with a top of the agenda. karen good morning. i'm very keen to hear what the conversation has been like on the ground in barcelona. >> juliana, just to. >> remind the audience that

telecommunications is the architecture that underpins connectivity, connectivity, all important for ai. so it's. >> not. just about routers and. >> switches and towers. >> it is about how we run ai on systems of. >> the future. and don't forget, there's been a big argument in europe that regulation has been too tough for too long, which is slowing europe down. i heard a lot of that commentary yesterday from tim. >> lucas, the ceo. >> of deutsche telekom. when i caught up with him, he had a very short. >> wish list. >> saying, look, we need more spectrum. >> this is a very obvious one. >> more spectrum. >> is required. >> he said we need a digital single market. we're talking about a single market in just about every aspect. but a digital single. >> market also. >> key for these companies. that every time they go into a country dealing with very different regulation on the ground, the third wish list was of course less. >> red. >> tape, lower the bureaucracy so the ecosystem can be much quicker. but i think what is key here. is that europe is. >> trying. to catch up. >> and how do we do that? well,

tim lucas. >> was saying. >> look, we need more data centers. we've had announcements. >> in recent times about. >> trying to match stargate, the. >> big ai. >> infrastructure fund, with money out of europe. president macron in france was talking about. raising euro dollar effectively by population numbers to ensure that there is the right architecture. but the reality is we still need the right data centers and we need cheap energy. don't forget, we're talking about very energy hungry systems here. electricity, at least in germany, is 2 to 3 times more expensive than the united states and china, which tells you about a competitiveness issue when it comes to ai right in the heart of europe. anyway, i caught up with tim cook, the ceo of deutsche telekom, and asked him about some of the issues he's battling from europe and what he needs to see change at this point. >> we have all this kind of wildfires everywhere. you know, there is the need for data centers. there is the need for more computation power. there is this need for ai. there is the need for connecting the world, for, you know, to bring businesses together. there's the

need for consumers to have faster access. and for all of this, you know, we are kind of. firefighters trying to solve that problem. but we have a leaking hose here in europe because the regulatory environment is not fitting. first, you know, what we need is water supply. this is our spectrum. we need urgently more spectrum in europe. the second thing is, you know, we need a digital single market. we need one market as 27. you know, european economies and not 27 different markets. it cannot be that i have a drop call on the borders, you know, in europe because you know, there are local legal regulations. the third one is, you know, before we extinguish the fire. what are we doing? you know, we have regulation. we have a discussion about it, how we organize ourselves. we have we have to stop the red tape. in europe, there is so much bureaucracy on our industries. we should go to an ex-post regulation then, rather trying to anticipate everything. we simply have to

get fast. and by the way, just look into the us. you know, in this market things are doing much better and the ecosystem is prospering. >> the european commission has been talking about less prescriptive regulation, still having goals but. without the prescription. >> as well as macron. >> talking about raising almost a dollar for euro. versus a stargate. are any of these positive tailwinds, or is europe still going to miss out. >> on the. >> ai race at this point? >> my worry is that we miss out on the big time. to be honest, i was quite impressed about president macron and his initiative in france. that was a great one. bring the community together. trying to build. something here in europe on ourselves as well. but the us is far ahead. they have the ecosystem of the big over the. top players who are having the financial power to invest. they have the technology. openai and all these developments are coming from the us. and on top of that, they have very cheap energy to deploy the big data centers.

>> tim cook is there. and of course, there's a lot of geopolitics in telecommunications. the weekend conversation, the white house between zelensky and trump. what are the consequences? well, more instability globally means there is even a. >> higher demand. >> for more secure telecommunications. >> of course, the vendor. >> supply chain has been upended in recent years. we were talking about huawei, how that. >> was cut out of the core. >> of a lot of western networks. >> and of course. >> chips too, who can access them. >> so this could spiral. >> forward in terms of access. and what comes next on restrictions? the other big point has been around deep tech, because this chinese technology. has almost been a u turn away from. the huawei story, where the chinese have been cut out of the system, they've done it on the cheap, come up with technology that western companies are keen to use to lower the cost of doing business. and don't forget, capital. spending is a problem here in europe, as we talk about very constrained. >> amounts of capital. >> to deploy. so most industry players have caught up with

today about how. they see. >> deep tech playing out in the consequences. >> take a listen. >> they brought a different thinking about how. we train. >> these models. >> and the reality. >> is that. >> you can have. >> smaller models. >> with better. >> data and provide. >> a better outcome. >> so i think. >> as we think going forward. >> what the deployment. >> of the ai will look like, i think it's a combination of multiple models. >> there is no benefit of ai without. >> connecting all the nodes in the network. so that's why those. two are together. and ipsec is a good thing because it lowers the cost point for ai applications, which means that the demand for ai will increase. r&d engineers were already looking at deep creek earlier. so deep creek has a very clever way of addressing or simplifying the way you run the model and train the model. so they have made a couple of improvements. i think we're just at the beginning of seeing those improvements continue to happen. >> one of. >> the big themes. >> here is what 5g with ai

means. and deutsche telekom has released a concept. >> of. >> an ai phone partnered with the big ai startup perplexity. google cloud, ai and others. and what they were showcasing to me yesterday. was that you can go to a supermarket with. >> a. >> rough idea of something you may want to cook for dinner, say lasagna. you then are going around the aisles, and the phone helps you identify what you need to add to the shopping basket, what type of meat, whether it's suitable meat that you're putting in or is the right type of vegetables the quantity that you need. so instead of the old days of where you would take a piece of paper with a roughly scribbled out list, we've come a long way. of course, i think some of us are using those ingredients lists when we shop in the supermarket, but now we're talking about virtual assistants, digital assistants, pretty much doing it all for you down the track. and in terms of if you've got a brown thumb, if you're out in the garden and you need to fix a plant that is dying, you can scan it and it tells you what you need to try

and fix that plant, which juliana, i don't know if you're a brown thumb or a green thumb, but certainly this sounds like a useful technology to me. >> it would definitely be a useful technology in our house as well. just over the weekend we're trying to repot some plants, so i hope they get working on that and i get my hands on it. karen, thank you so much for bringing us those conversations on the ground. really interesting. next to the conversation around more defense spending in europe. europe is just under pressure to spend more in so many areas, and that's really interesting to hear. the latest on ai spend now coming up on the show. us officials ramp up pressure on ukraine's president zelenskyy after his meeting with trump collapses in dramatic fashion. collapses in dramatic fashion. we'll have the latest next. (auctioneer) let's start the bidding at 5 million dollars. (man) robinhood gold members get a 3% ira match. while the wealthy hoard their perks, our retirement contributions are boosted by 3%. now with robinhood gold.

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white house talks between president trump, vice president vance and ukrainian president zelensky descended into an argument before the world's media in a tense oval office meeting friday. trump and zelensky had been expected to finalize an agreement over ukrainian critical minerals, but the talks fell apart and a press conference was canceled. after this exchange. >> first of all, during. >> the war, everybody. >> has problems. >> even you. but you have nice. >> ocean and don't feel now. >> but you. >> will feel. >> it in the future. >> god bless you. god bless you. >> god bless you. >> you don't tell us what we're going to feel. >> we're trying to solve a problem. don't tell us what. >> we're going to feel. >> i'm not. >> telling you. >> because you're in no. >> position to dictate that. >> remember that. >> you're in no position to dictate what we're going to feel. >> we're going. >> to. >> feel very good. >> we're going to. >> feel. >> very good. >> and very strong influence. >> you're right now not in a very. >> good position. >> you've allowed yourself. >> to be in. >> a. >> very bad position.

>> and it. >> happens to. >> be right. >> about from the. >> very beginning. >> of the war. >> not in a. >> good position. >> you don't have the. >> cards right now. >> with us. you start having cards. >> cards? right now. >> you don't. >> you're playing cards. >> you're playing cards. >> you're gambling. >> with. >> the lives of millions. >> of people. >> you're gambling. >> with world war three. you're gambling with world. >> war three. >> and what you're doing is very. >> disrespectful to the country. this country. >> that's back to you. >> far more than a lot of people said. they should have. >> have you said. >> zelenskyy has faced calls from senior republican lawmakers to consider resigning after his visit. the ukrainian president spoke to our sister channel, sky news, at a press briefing before he left the uk, reiterating his stance that he would consider stepping down if his country secures nato membership. >> of nato. >> i said. >> that i'd be. >> exchanging it for nato. >> membership. >> which would mean that i'd fulfilled. >> my mission. >> although honestly. >> it looks. >> like some. >> people and.

>> i won't be naming their positions. >> but let's just say. >> some citizens of other countries are telling ukrainians which president. >> they should have. >> especially if these people. >> occupy official posts. it seems to me unconstructive and undemocratic. >> president trump has ordered a new trade investigation that could result in tariffs on lumber imports. white house trade adviser peter navarro accused lumber exporters including canada, germany and brazil of dumping lumber into our markets. us treasury secretary scott benson says mexico has offered to match us tariffs on china to avoid duties threatened by president trump, with benson calling on canada to follow suit. in an interview with bloomberg, a 25% tariff on goods from canada and mexico is scheduled to come into effect tomorrow at midnight tonight. although trump has indicated the final amount could be different. well, i'm very pleased to have kelly ann shaw with me now partner at hogan lovells and former trump administration official kellyanne, it's great to get you in studio to hear

your take on what's been happening in washington. given your experience, you've spent more than a decade as a trade negotiator. you were part of the negotiations in the first trump administration. let me kick off with the events in the white house on friday, that oval office meeting. what do you think president trump was trying to achieve with that confrontation with president zelensky? >> yeah. thank you for having. >> me on. and it's great to be. here in person. i think that the president was trying. >> to achieve a. >> critical minerals deal. >> first and foremost. >> and then the. >> meeting devolved. >> in the last five. >> minutes of that. >> bilateral into what. has played out. >> for international news. >> and i think what. >> you're seeing is a reflection of some of the frustration. >> that president. >> trump has about wanting. >> to settle the war. and as you're aware, the. >> politics in the states on this. >> are very different than the. >> politics in. >> europe. >> where the activities in ukraine and russia's invasion. >> are much more. >> existential in terms. >> of the impact for european nations. >> and from the perspective. >> of the. united states. >> citizens. >> it's about ending the war. >> as soon. >> as possible. >> and so.

>> i think that's. >> where some of the differences. >> played out. but i do think that. >> ultimately the president was trying to. >> ink a deal. >> and i think that that still on the table. >> how does it compare to other exchanges like this? i mean, you've been in the room with president trump when he's engaged with world leaders. how does this stack up to some of his usual interactions? >> yeah. and what's interesting for. >> me. >> to. >> see is that. >> i have seen dynamics like that behind closed doors. >> i've been in a number of bilateral. meetings between. >> world leaders that have. >> frankly. >> gone worse. >> than that. >> but this is one of. >> the few times. >> that you see it play. >> on the big screen. and the last time that. >> i saw a dynamic. >> like this play out was back in 2021, when you had. >> president biden's secretary of. >> state, blinken, engaging in this alaska summit. with his chinese counterparts. and there you saw a bit of a shouting match happen. >> which. >> was quite. >> unique as well. but i think that's. >> what's so. >> shocking for. >> for most people. >> watching it is that this normally doesn't happen. these meetings are normally very orchestrated. >> so the content isn't actually that shocking. it's just the fact that it played out on the world stage in terms of this

minerals deal. as you said, that was where the conversation started. but things quickly descended into chaos from there. do you think there's still a chance we get that deal? and it seems as though trump's rationale for that deal is for the stake that the u.s. would have in ukraine to serve as a deterrent for russia, and that in itself would, in his view, deter russia from invading again or doing something similar again in ukraine. just give us your thoughts on that. >> exactly. >> it's not about. putting boots on the ground. it's about. >> putting american. >> businessmen and. women on the ground. and that that in and of itself would serve as a deterrent for putin reneging on some sort of cease. fire or some sort. >> of deal. >> so i do think the deal is still potentially on the table. and those are the signals that administration officials have been giving over the weekend. and i saw the interview with. prime minister starmer, as well as his speech after the european leaders met yesterday. and he indicated the same thing, that the united states and the. >> uk and europe are.

>> still very much on the same page. they'll play different roles. but that there's still the possibility of an off ramp here. >> let me ask you about tariffs. we'll change tack a little bit because i think the investment community is quite focused near term on these tariffs on mexico, canada and china that are due to come into effect at midnight. there is some speculation, i think, some hope in the market that we could see some negotiations, some last minute negotiation over the next, you know, what is it, 12, 16 hours. what is your take? do you think there's scope for the trump administration to roll back the 25% on canada and mexico? >> yeah. >> well, there's. >> always scope. and what i would say is from president trump's perspective, there are two different types of tariffs. there are the tariffs to rebalance the trading relationship to do economic. style policy. and those are designed to stay in place for long periods of time. and then there are the tariffs for national security purposes, the tariffs threatened for fentanyl for immigration. and there could be other issues where he's threatening across the board tariffs. those are not designed to stay in place long term. they really are about getting another

country to do something much in the same way that the us uses our sanctions policy. tariffs are another tool the president uses. so when it comes to canada and mexico and fentanyl, i think that if canada and mexico come to the table to address the deaths related to fentanyl and that there is scope for another suspension or for these tariffs eventually being rolled back. >> what about europe? what is the approach from the trump administration toward europe? what is what what category would you put the tariffs that are on, you know, that have been threatened on europe? >> yeah. so these. >> are all. >> about economic issues. they're about the non reciprocal tariffs. they're about state aid. they're about the digital services taxes. they're about these unbalanced trading relationships. and so there we won't know exactly what the president plans to do with europe until after april 1st when we see the administration's reports. but he has signaled very clearly that he plans to take on both the tariff and non-tariff barriers from europe. and so i do expect him to announce tariffs sometime after april. >> is there a link between us europe relations with regards to

ukraine right now and us europe relations when it comes to trade? in other words, does president trump view all of these as potential factors in a broad based deal with europe? >> so in my experience, president trump is very good at bifurcating the national security concerns with the economic concerns. i call it walking and chewing gum at the same time where with a lot of previous us administrations, they didn't take on our friends and our allies for some of these economic reasons, because of the alliance and because of some of our strong national security interests, president trump bifurcates them. and i think it goes the other way as well. so to the extent that, you know, europe and the united states continue working together on ukraine, i don't think that that is going to influence his decision to take action with respect to the economic issues, one way or the other. >> okay. and finally, on china, what is your expectation for the next step in trade relations between the us and china? >> yeah. well i think we're going to see tariffs on tuesday

an additional 10%, which will bring it up to 20%, plus the existing 301 tariffs that we had from the first trump administration. i think we're setting the stage for some sort of discussions or negotiations. and so april 1st, the us trade representative owes to the president a review of the china's compliance with phase one of the $18 billion in tariffs that the biden administration imposed to see whether there's sufficient or there should be adjustments. and then china's ip practices. so that suite of issues coupled with this 20% now tariff because of fentanyl, will set the stage for a potential negotiation with china in the months to come. >> and who's next after china? we've got the eu already targeted mexico canada. who else is on trump's agenda? >> yeah, well i think north america is first, followed by china and europe. but any country that has a large and sustained trade deficit with the united states will be in the administration's scope. so i'm thinking about india. i'm thinking about vietnam. the administration's talked about

taiwan and just go down the list of the top ten trade deficits. and that's where i think you'll see some action in trade actions from the administration. >> kellyanne, thank you so much for sharing your insight. great to get an insider's view on what may be going on in the oval office, and in the rationale behind the trump administration's latest moves. kellyanne shore, partner at hogan lovells. former trump administration official will leave you with a look at markets. you've got a positive reaction in europe this morning, largely driven by those defense names, which have continued to move from strength to strength on the expectation of more spending from europe. u.s. futures also trading in the green as we set up for a positive session on wall street. that's it for today's show. i'm julianna tatelbaum. worldwide exchange is up next. >> america. >> you love alien tape. and now you can get two. >> roles for free. >> that's right. free. >> introducing alien tape. >> the double.

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