called rbc elements, and rbc insight, which is a satellite provider that looks at crude storage levelslobally, which you're obviously very familiar with. what we've seen over the past six weeks or so, or back to dating when oil inventories were at highs, what we've seen is a draw of 27 million barrels. what's important about that is not just that it's a big number over a short time, but it's a counter seasonal drop. q1, we should be building, but we're actually drawing. again when you look at the fundamentals of this market, they probably look tighter than we thought from just a few weeks ago. alix: venezuela is adding fuel to the fire. reggie, what is the state of play now for venezuela? reggie: now we're going to see the opposition try to raise pressure from outside venezuela. this situation, what we're seeing right now in venezuela, is pushing towards a chaotic, disorderly outcome because the maduro government is very, very reluctant to leave power because they cannot get guarantees from the opposition about their own well-being under a new government in venezuela. we're likely to s

credit suites from 74 to 70 and rbc 68 to 61 rbc bull point up 12 from where currently trading and bear's hold off on adjustmejudgmt first. what's the bull case emerson has 25% of revenues of energy oil and gas cycle still has steam w. even with crude down $52. they predict continued investment in mid stream and downstream and look to natural gas facilities, all businesses emerson dominates. and they like the outlook for petrol another major customers. they look to bolster smart acquisition and based on free flow of company expect $2 billion this stock is too cheap to ignore. that sounds pretty compelling to me, right. listen to the bear case from rbc. this is more focused on the big picture. rbc points out the outlook for 2019 is very uncertain they expect emerson automation vision to slow from so10% organ growth to 8% this year oil gain expect to turn down that makes sense think where oil is going the heating and air-conditioning business gets 10% of its sales from china you got me okay and that's not good considering the chinese slow down and of course the continued trade war and the

downgraded to underperform at rbc, rbc analyst saying carlton's desk problems in france partly executione than 4.5%. also we see easyjet raising higher today. it was upgraded to outperform davies, looking at the sector, earnings drivers are favorable for the industry right now. anna: thank you very much annmarie hordern. up next, it's monday so we talked deals. we delve into the m&a dropping markets, including private talks with rbc. the deadline has been extended for a fifth time here in london. we talk about the m&a sector. it is 8:42 in london. with that live shot of westchester. this is bloomberg. ♪ matt: welcome back to bloomberg markets, this is the european open. we are about 45 minutes into the trading day, .2% gains on the ftse. other indexes across the continent are down. european stocks trading down. it is m&a monday, so let's take a closer look at some of the deals which are driving markets in europe. joining us from our deals team is sara site need. welcome to the program. thanks for joining us. apollo has extended its deadline to take private talks with rpc for a fifth time

mike of rbc capital markets and reggie from stratford.we head to break, saudi aramco betting big on lng. it is looking for investments in several countries, the u.s. included. the ceo outlined his vision in davos, switzerland. looking for investments in several countries, the u.s. included. the ceo outlined his vision in davos, switzerland. amin: we'll be exporting gas from saudi arabia, either by pipeline or energy. we are looking at international gas, not looking at expanding. we are going to be the major player on gas globally. we are in discussion with many companies in the u.s. the opportunities are there. ♪ alix: i am alix steel, and this is "bloomberg commodities edge." -- ♪ alix: i am alix steel, and this is "bloomberg commodities edge." it is time for the data dig, where we delve deep into the market trends. first up, crude inventory numbers. there was a story for crude but the story continues to be gasoline. stocks rose over 4 million barrels. 10% above the five-year average. it is the utility story that keeps on giving. pg&e is

mike trader of rbc capital markets and reggie from stratford.ooking investments in several countries, the u.s. included for aramco. the ceo outlined his vision in davos, switzerland. >> will be exporting gas from saudi arabia, either by pipeline or energy. we are looking at international gas, not looking at expanding. we will be a major player on gas globally. we are in discussion with many companies in the u.s. ♪ steel, and this is "bloomberg commodities edge." it is time for the data dig, where we dive deep into the market trends. first up crude inventory , numbers. there was a story for crude but the main story continues to be gasoline. 10% above the five-year average. utility story that keeps on giving. pg&e is trying to get debtor in possession financing. that would make it the second largest in u.s. history. the company also wants to increase capex spending while in bankruptcy as high as almost $7 billion in 2020. one big effect of political upheaval in venezuela. this chart right here, this is oil you get on the gulf of mexico versus that

thanks, wilf for more on the banks and on goldman specifically, let's bring in rbc's head of u.s.k equity strategy, gerard cassidy. gerard, good to see you, as always >> thank you, carl >> what do you make of that 1mdb defense? >> i think he did a very good job on the conference call he was sincere, passionate, and was obviously upset at what happened so i think david solomon, in his first earnings call with the street community did a very good job. >> does it -- does this ongoing coverage of the issue put a cap on the shares, over the next, i don't know, year or two? >> i think, carl, i think you're on to something, because there's certainly going to be a cloud overhanging goldman until this issue is resolved. we know there are investigations going on by the department of justice, the bank regulators are doing their investigations, so, obviously, we've got to get this resolved once that's resolved, that cloud will go away but, yes, i'm with you i think there is a cap that will be put on the stock, vis-a-vis, bank of america or jpmorgan or morgan stanley, who are going to benefit

. >>> plus wall street turning on a different automaker, tesla, as rbc downgrades the stock there are now more analysts with sells than buys. >>> and later, this could be walmart's year, at least according to morgan stanley, but one trader thinks a different retailer could wind up on top. we are live from times square in new york city. much more "fast money" right after this ♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest. you'now until january 24th, would like to say, "thank you." enjoy a free week of movies on us- from networks like epix, lifetime movie club, hallmark movies now, and history vault. just say, "show me movie week." that's a full week of your favorite hit movies on your tv, online, or on the go with the xfinity stream app. [shouting] and it's all on us, all week long. you've got some serious watching to do. >>> welcome back to "fast money. time for our call of the day walmart getting a boost from morgan stanley upgrading the world's largest retailer for the first time in four years to overweight the stock

laura cooper of rbc wealth management.dline crossing the bloomberg, this according to the st, saudi arabia slashing exposure to tesla and share volatility. tesla taking a downturn, down 1.7%. they are reporting that saudi arabia slashed exposure less then four months after the ceo of elon musk settled fraud charges over his claim the kingdom was ready to back a buyout. stake,ads most of his according to people with direct knowledge of the matter speaking with the financial times. and that happened after the market closed on january 17. so very little exposure if. tesla falls. tesla stock down 1.8% now. won a, deutsche bank has commitment for a new investment from carter. they say the investment is likely to be made from the sovereign wealth fund in qatar. now, steven arons. what is happening here? stephen: well, i think that it is straightforward, they are saying they stand ready to make an investment. it is a good time for deutsche bank, they probably will need eore capital, if plans to merg with another bank go ahead. so

joining us now to discuss all this and more is laura cooper, head of fx solutions and strategy at rbcnagement. i want to start with these trade tensions. we are hearing that the china vice premier is going to go to the u.s. for discussions. you get atually -- sense of a stimulative bias. do you get the sense that china at the moment is wanting to stimulate its economy through any means possible, except weakening the yuan, for fear that might derail the trade discussions. laura: we don't expect them to use it as a policy tool at this stage to try to stimulate growth. , if anything i would expect that to be a last resort for them. as we expect, we could see some kind of risk appetite improved on the back of these trade discussions. that in the near term should -- remaining relatively where it has been. if we do see an escalation, possibly later this year that we could see the chinese central bank begin to use currency more so. manus: a very good morning to you. it's manus in dubai. we have also run our numbers at bloomberg intelligence, and they suggest another trickle. they look at the

capital pools and the requirements but the core banking, the industry is very consolidated >> with rbcrard, great to have you with us you kindly remind us in our guest notes that there were actually more than twice as many banks in the united states at one point in the 1980s compared to right now, brian moin hynihan mentioned about 6,000. a new bank could emerge, you find that plausible? >> depends on how you want to define giant but absolutely right. you know, back in the 1980s, we had over 14,000 banks. nationally, state banking legislation was passed in the early 1990s which enabled these giants to be created i don't think we'll ever see another trillion dollar in asset banks created but could we see banks with 5$500 billion to $700 billion created? i think we could but the giant size so-called globally important systemically bank? i doubt we'll see that kind of bank created. >> in your coverage, which regionals seem to be on the hunt for some sort of acquisition fifth third, there's a pending one right? with fifth third and a bank out of chicago and the biggest banking merger we've

months, cash flow estimates for the industry need to come down a lot according to rbc.y expect material downgrades for the sector in terms of earnings. there could be pressure on the big oil majors in europe is morning. anna: we will keep an eye on the oil majors. maria, volvo trucks? >> the world's second-largest truck maker who announced close to 800 million dollars charge over faulty emissions control system. for the fourth quarter, it dragged on cash for several years. in october last year, they announced they would have to take a hit over this and now we know it will close to $800 million. anna: thanks to the three of you. thanks to the stocks team and you can get insight into the latest stock stories by going to first go. it will be time for the market open for the friday. futures are pointing higher. we expect to pick up on positivity the trade news flow has created. a bit of a bounce after yesterday. this is bloomberg. ♪ amazon prime video is now on xfinity x1. so when you say words like... show me best of prime video into this... you'll see awesome stuff like t

joining us now is the head of investing strategy at rbc. thing to fill up that picture overnight as well is the earnings we got from apple. iphone revenue still falling. still weakness in china. they are trying to get investors to focus on the fact that we are not all about the iphone, it is a whole services business. overnight, investors seemed to buy it. was it just a relief rally? if we look at the earnings picture, we have the route in the fourth quarter that left a cushion for disappointment with these earnings coming out now. that said, companies beating estimates at the lowest rates since early 2017. . the earnings we have seen so far, does that give enough reason to buy into equities right now in the u.s.? >> last year was a particularly strong year. is thatare noticing companies are beating on average by a bit less than they did last year. now 5%s expectations are of the year. robustseeing a less economy. a slightly softer u.s. economy. forecast for gdp in the u.s. has come down to 2.25%. still some growth. that is achievable given

rbc says the reality is there are entirely too many challenges -- what are you expecting?it's a little early for them to be articulating against this background of the uncertainty in terms of changing messaging regarding the balance sheet or even regarding interest rates. i suspect the fed will want to date clear of those issues, particularly in public pronouncement, you event that the economy is still sensitive. we will not be seeing the data property for some time, we have to catch up with data that has already been miss, and we will also start to see the full data. i think it will take a little while longer the fed to become more confident, to send stronger singles on monetary policy. >> we saw the greenback we can on friday. aken on friday. there's uncertainty in the fiscal side. there's really not much of an option in a time of general anxiety, it's a difficult balance to strike. >> markets will remain concerned about bigger geopolitical issues, trade issues will remain prominent, and that will require or create demand for safe haven as well. be reliefere will that th

. >>> whirlpool was addown to underperform from sector perform at rbc capital with thenalyst citing industry uncertainty. thatstock's recent rally made it a little too expensive. the price target is $111. the stock fell 3% to $132.15. >>> juniper was downgraded to underperform from buy at bank of americall merlynch. the call follows the company's disappointing fourth quarter results and guidance which pointed to weak demd and pricing trends. pre target $25. that stock fell 5% today on this big rally day to $25.83. >>> coming up, facebook shares take off. we'll tell >>> the labor market started 2019 where it left off in 2018, on a strong note. private payrolls have grown at a much faster pace than expected in january. according to adp, employers added 213,000 jobs as businesses continue to aggressively expand their ranks where they can. biges compa added 66,000 of those jobs. midsize firms added 84,000. small businesses gained >>> and the government releases its own monthly employment report friday morning. >>> investors are watching hose trade talks between the u.s. and china, which got unde

fellow dow component united technolo tes downgrad secretary are importantly from outperform at rbc capital markets. thlyst says the stock may be stuck in limbo million the company's previously announced h breakup w occurs in 2020. price target, $119 a share gained more than 3% to netflix was added to the conviction buy list at goldman the analyst says that net flex investment in content, technology and distribution will driver subscriber growth above expectations. knows are high too. price target. 400. shares added 9.5% to 297.57. >>> still ahead with the l rise nd wag something it time to invest in the american consumer? our market monitor says yes. but first a loo at we cannily gains for major averages. a look at weekly gains for the major averages. >>> and it is time for our ekly market monitor who is betting on continued growth in e commerce in the dpleer. he has names he says you want to own the next three to five tars. this is first time on "nightly business report." we welcome dryden pence. chief investment off at the pence wealth management. good to see you dryden thanks for joinin

nter public group was downgraded to sector perform from outperformt rbc. the analyst expects organic growth to decelerate this year after recent account losses. the price target is $24. the shares fell a fraction to $22.25. >>> signet was downgraded to sell from neutral at citi. the analyst says it is vulnerable to an economic slowdown. yesterday we told you about its weak holiday sales. the price target is0. nonetheless, the stock rose 1% to $25.41.ti >>> ahead, why tesla's road ahead looks bumpy. >>> facebook's privacy lapses may result in a record fine. according to "the washington post," the ftc is reportedly consering a payment in excess of the $22.5 million imposed on google in 2012. the ftc announced an investigation into facebook back in march when it was accused of misusing the personal information of its users. >>> opec slowed its oil production in decemb. in fact it was its biggest monthly output decline in two years. according to the international energy agency, that decline was dry saudi arabia, the world's largest crude exporter. like stocks,

analystwith rbc -- bank with rbc capital management and ira jersey. let's bring up a chart.-- adjusted fed funds target rate. we were ultimate -- altra accommodative and we come up again. where do they want the fed funds target rate to be? >> traditionally, the equilibrium real funds rate is in the neighborhood of real gdp growth. being after the crisis, there is no consensus that it is quite about lower. i am skeptical. that is why so many people are thinking now that we have finally poked our nose above zero that maybe we are done. we will see. tom: steve stanley has an optimism on the economy. there is the chart that tells the details. does that shaped the fed's view? ira: it has to continue to do that. , whatou are near neutral is this magical rate? nobody knows. it is a moving target. not a lot of funding goes on in the front end of the market. it used to be that tanks and credit cards and other funding happened overnight with rates. most of the funding for the consumer sector is in the five and 10 year space. does the real fed funds rate matter or do five and 10 year r

let's rejoin our conversation with rbc and bloomberg intelligence. we are waiting for ibm to come out with results. you are underweight and technology. tech has software, services, hardware, apple. is there pessimism on technology or caution across the different groups? >> we think semiconductors are looking interesting from a valuation perspective. i think you need this earnings reset. it is also trade sensitive. you need progress there. the area within tech that i worry about is software and services, the domino that has not fallen yet, violations high, sentiment bullish. that was true for hardware into we got bad news in that space. we are still underweight. but youcome off of it, have not seen an f dominoes fall yet. >> one of the big discussions is cloud and the corporate i.t. spending. it could affect the broader sector. >> it could. we have been having this debate this year. is technology secular or cyclical? names, i-related perceive don't think it is purely secular, so i think we will put that to a test. >> a lot of people dismissed apple's

deane dray of rbc capital markets and brooke sutherland of bloomberg opinions. thank you.pmorgan says stock and the credit markets have not factored in the fed tipping away from monetary tightening. this is bloomberg. ♪ lisa: -- stocks in the credit market still not priced in the fence pivot away from price hiking. there is still room for these hiking if the fed says it will pause its cycle. the idea is spreads have gone higher than where they should have gone given the trend and given how growth is. i have to say, this is the big question i have. --ht now our stock investor right now our stock investors or credit investors being optimistic or pessimistic? this is a point of debate. what we saw with caterpillar are people are still seeing weakness. david: the key phase, if the fed. up, jonathan ferro. this is bloomberg. jonathan: -- this is bloomberg. ♪ jonathan: from new york city for our viewers worldwide, i'm jonathan ferro. the countdown to the open starts right now. ♪ jonathan: coming up, equity , caterpillar the latest company fueling concerns about china. chinese go

do you buy that coming from rbc? woo: there are still a couple of uncertainties out there.e were still looking for resolution of the u.s.-china trade war. if the disputes go longer than we anticipate, the call for second-half recovery maybe a little bit premature. smartphones space, people are looking for the next iphone or the next smartphone to help recover on the second half. reportsn some of the coming of the next iphone. it doesn't really excite me. perspective, you are not going to see much earnings growth in the second half. wooine: thank you, that is jin ho. coming up, caterpillar also ringing the alarm on china. more on that ahead. this is bloomberg. ♪ romaine: breaking news, whirlpool reporting earnings, coming in above estimates. four q neting on sales. the estimate was for $5.8 billion. their fiscal year forecast for the current fiscal year coming in at about $14-$15 per share. the estimate was for about $16 a share so the stock moving down almost 5% right now. now we turn to another company that is also blaming china for some of it's disappointing results, that

let's bring in now helema croft at rbc there's so much to unpack. listen, the sakes and the oil itself don't appear to be that big of a deal. they're down to 500,000 barrel az day we can use easily make that up what about the citgo news? how much do you think that is going to alter the game in venezuela? >> i mean, this is a huge story. if you think about for venezuela, all their exports to china and russia are essentially paying back loans. they generate revenue by placing barrels in the united states we really are taking away billions of dollars from the moduro government. it's a move designed to get the military to finally abandon him. whether that happens remains to be seen, but it is a crushing blow for the venezuelan economy. even for u.s. refiners, it's going to cause a struggle to get more heavy barrels at a time where we have sakes on iran. iranian barrels are not coming into the united states, and saudi arabia has decided to cut exports to the united states in an effort to pump up prices. i do think it's going to be interesting to watch th

the rbc commission pronoises his last name mcarina. >> i was definitely wrong. >> he's still here. >> pete williams, thank you very much. >> thank you as well. >> the shutdown is not the only thing happening in america. while you are not looking is next. not looking is next so if there's a better treatment than warfarin... i want that too. eliquis. eliquis is proven to reduce stroke risk better than warfarin. plus has significantly less major bleeding than warfarin. eliquis is fda-approved and has both. what's next? reeling in a nice one. don't stop taking eliquis unless your doctor tells you to, as stopping increases your risk of having a stroke. eliquis can cause serious and in rare cases fatal bleeding. don't take eliquis if you have an artificial heart valve or abnormal bleeding. while taking eliquis, you may bruise more easily and it may take longer than usual for any bleeding to stop. seek immediate medical care for sudden sign of bleeding, like unusual bruising. eliquis may increase your bleeding risk if you take certain medicines. tell your doctor about all planned medical or

rbc, royal bank of canada was able to access messages. the third part, very recently the company confirmed there was security breach that impacted 30 million users. saw a selloff in the stock. as soon as news came out, literally up tick right afterwards. why? earnings are coming out. a lot of analysts are bullish on facebook. nonetheless, what will the cost look like? in 2012, the ftc fined google $22.5 million. that was the record then. so it is most likely going to be more. i reached out to the ftc. got an email back. sorry we're closed because of the shutdown. no comment from them. facebook earnings coming up. connell: interesting to see the stock off the lows by the end of the day. kristina partsinevelos. melissa: panel, scott, what do you think? there are a lot of people talk about facebook being dead money at this point, between this kind of regulatory headwind, the fact only people's grandparents are regular users what do you think? >> everybody else is using instagram including myself. everybody is cool then i guess. here is the t

with the closing bell ringing in 50 minutes, we have apple second to last on the dow 30 heat map after rbc forecasted growth in apple services and when we say that, we mean apple music, slowed in the all-important fourth quarter. >>> and brexit d-day looming. the battle lines drawn as the united kingdom faces a do or die vote tomorrow on its future. businesses already bracing for the worst. but is that what is really coming? we are flying you to london as the clock ticks down. we will hear from the man who says he knows which side will lose. plus ashley webster has the latest breaking news. i can't tell you who i am or what i witnessed, but i can tell you liberty mutual customized my car insurance so i only pay for what i need. oh no, no, no, no, no, no, no... only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ touch shows how we really feel. but does psoriasis ever get in the way? embrace the chance of 100% clear skin with taltz... the first and only treatment of its kind offering people with moderate to severe psoriasis a chance at 100% clear skin. with taltz, up to 90% o

skids today after the automaker cut production hours for its models s and x vehicles this comes as rbcowngraded the stock this morning that meaning the number of sell ratings is now higher than the buy ratings on tesla matt and stacy arehere to weig in on this one matt, last week, i think i looked and this might be the 30th time this stock has crossed the $300 mark for share price in the last two years where does this leave it technically? >> well it's been like you said, this range, it's been going on for over four years now. the stock is trading just below $300 that's where it was in september of 2014. now tesla is a stock for risk investors, they're looking to maybe hit a home run great. but the problem is when you get a stock that can move fall 40 to 50% within a range and rally 30%, that's a certain amount of risk involved, but four years later, you end up with a net no move, zero gain. that's not good. every time the stock gets to the lore end of its range, mr. musk says something that about the company that's bullish and usually doesn't come to fruition when it gets high, he say

home depot, rbc raising the target price on that stock. they are all gaining here. good news here. let me tell you a little more about apple. they are up despite a nikkei report, that the company planned production for its three new iphone models of the january march quarter by how much? 10%. you would think that is bad news? no. traders are out and buying. we talked about the trade-in program. we want to let you know chips were a big segment today. everybody buying chip-makers especially micron, because these companies do well with sales from china. back to you guys. melissa: gerry, thank you for that. connell: the meeting that wasn't. president trump abruptly ended a meeting at white house last hour with congressional leadership after democrats refused to compromise and negotiate on his worder wall. so our market panel today, let's bring them in, capitalist pig hedge fund. todd horowitz, bubba trading show host. we talk about how the big issues are the market and china and the fed. this government shutdown shouldn't have much of an effect on trading, maybe this last hour of tradi

netflix's announcement they're raising their fees 13 to 18% is huge according to rbc capital a terrific piece of instant research titled flexing pricing muscles we know that netflix was generating about 11.44 per sub in the third quarter if you slap a 15% increase on the average customer you get 1.18 billion in incremental revenues and all that flows straight to the bottom line. wow, instant riches. even though netflix had seen the stock surge 25% since the beginning of 2016, the stock packed on 25% today. the darn thing is now up more than 50% from its december lows. and why not? all the research we got this morning shows that there won't be much pushback here. netflix has been underpricing its streaming service for ages in order to hook subscribers on terrific content if people try it, they will get addi addicted netflix is only going to be charging little more than some of the other paid services that have a lot less content. i'm thinking about hbo and hulhu consider this insight from piper jaffray report this morning, we believe the primary determi in content quality. in november of

we do that with the chief currency columnist at rbc.view with robert kaplan was important. what do you want to hear from robert kaplan of dallas later on bloomberg? i love your phrase, "the repricing of central banks." what do you want to hear from robert kaplan this morning? >> i think markets are hoping to her some reassurance that the fears that have crept into markets in the last two weeks or so, slowdown in global growth, mostly in china, some reassurance the fed is less worried than markets and that might allow us payrolls tomorrow -- i'm not sure how far we can go, that may allow us to price in a slightly more realistic prospect for u.s. interest rates than the curve prices in. tom: in the progress ask, what observe in the dynamics yesterday, the four standard deviation move we saw. what was the observation you saw that you can bring to us? ism: i think the bottom line firstly, that is partly how our markets work now. manner thanabrupt the way they used to move. simply a reflection of a fact that dollar-yen is particularly shallo

. >> rob, thanks very much >> i think rbc just upgraded the stock and put a $45 price target on it. it's been in a pretty significant downtrend since april but right now on the verge of breaking out. i think the report on february 13th, i think for a shot for a trade it's pretty interesting. >> we're talking about key levels i have to agree. what dan is talking about, you can make an argument that 2750 is really the level on the s&p you can make an argument 98 on the sma. semis have recovered 20% off the lows i will talk about emerging markets because they started this the eem is now above the 200-day on the upside for the first time trading through to the upside, the first time since december of 2016 so a lot has changed in that part of the world that was nasty despite those stories in china. >>> we've got a news alert on apple. let's get to josh lipton in san francisco for the details. josh. >> mel, we have drama here in silicon valley it looks like apple has now revoked google's enterprise developer certificates in retaliation for an app that violated its policy. what does that m

what we're seeing across the board for a few analysts i was reading a few notes, credit suisse, rbc ands is a good thing. if anything we won't see cancellations, if people don't like the price hike, until june. why? because the rollout won't be another three months for existing members. so when you have that, people need to see the bill, they need to realize three months from now, uh-oh, it is more expensive. we could possibly see cancellations. that should happen in june. look out. we'll pay close attention to subscriber rate in june. since we're talking about competition, let's talk about, since we're talking about netflix, let's talk about the competition. you've got nbc that has now announced they will be launching their own streaming service. this will be free but ad-sported. fit is not ad-supported it will be $12 a month. look how compared across the board. youtube tv 40 bucks a month. all these are the monthly rates. with nbc though, interesting thing that they are going to have ads every three to five minutes per hour, if you want the free version. netflix, though, reporting ear

buyers that goes down in the first half of this year you take a look at shares of tesla, a note from rbcal it is cutting down to 290 in part because you have the $2,000 price cut going into these vehicles which raises questions about gross margins as well as demand this is something we'll see a lot of analysts and investors in the first we're. >> what's concerning about these production numbers the fact you did have the tax credit you would presume to see, maybe some of those moved forward and aren't suggesting that >> reporter: sure. elon musk was tweeting even on new year's eve, the stores are open until midnight. go in there, buy a model 3, a model s, whatever it might be. buy that vehicle and qualify for the $7,500 federal tax credit, and there was thought perhaps we could see a pull forward people who thought i'll do it early next year, let's do it in 2018 what will we see in the first quarter in terms of deliveries and sales. >> phil lebeau from chicago, thank you. as we head toward noon all the major indices in the red right now. not nearly as far down as they were earlier in the

downgraded by rbc to underperform. the stock is down, nearly about four or five bucks. >> january 30th. soon ahead of the schedule. not just rbc, a lot of analysts voicing their opinion, worried about tesla, elon musk alluded to the fact they may make a small profit for the fourth quarter, when the third quarter was a surprise profit, historic moment according to him. a lot of investors are looking for is there continued demand for the model 3, model s? that is a major concern. their money, cash on hand. been doing all kind of things. raising price of supercharging. raising price of higher-end vehicles. lowering to have a base model 35,000. they're cutting staff. getting rid of referral programs. a lot to look at for this company. a lot of confusing heads amongst investors about sustainability of it. stuart: in the past few days the stock has gone from 350 to 288. ashley: a lot of smoke and mirrors feels like. stuart: drop and a half. ashley: yes. stuart: now this, we have a headline, it caught our eye, the headline is, trump is daring to clean up the establishments big

from rbc pretty positive. a downgrade at one of the brokers, which could be moving things around a little bit this morning. we will allow things to settle. some luxury names moving lower, but they have gained big in recent sessions. markets opening largely lower, with retailers the standout sector. china session in asia, as inflation data overshadowed trade optimism. joining us now to lend his insight, the chief currency strategist at bny mellon. happy new year, if it is not too late to say that. let me ask you what you think about the markets at the moment. around christmas and new year's it looked volatile and negative, and since then something of a rebound. where does your conviction lie? simon: my conviction for the next month or so is we will probably trade sideways. we went into the end of last year, clearly there were concerns about global growth, about trade, about what the fed ,as signaling, about brexit many things. markets, given we have had seven or eight years of solid gains, they are starting to

we announced the largest buyout rbc, in thempany, u.k. and that is led by barclays.nk there are three things you need to think about when you have this conversation around consolidation. one is in retail banking, scale matters in your national markets. and royalat lloyd's bank of scotland, i do not care about the size of bank of america in the u.s., as long as brian money and is not opening a branch and liverpool, it does not matter. jamie does not sit there and say the cow big the postbank of china is, that is one to chase. we look to your national market. and investment banking, scale does have value. we have the same balance sheet rave -- risk-weighted assets and balance sheets that morgan stanley does. barclays has the scale today to compete with the large american banks and do see that gaining market share in terms of our activities and debt capital markets. and then if you do not have the scale, if you talk to any investment banker who has been through a merger, they will tell you they do not work, talk to someone from doj, first boston, jpmorgan and bear stear

rbc is predicting the elon premium swirling around the always colorful ceo elon musk has quote, come and gone so it's cut the stock to underperform. it's down 4%. plus short seller david einhorn piling it on, calling out tesla in a letter today, saying supply shortages will soon shift to a demand shortage. so tesla shares are currently sputtering out. we'll be right back. alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. fidelity. ♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest. at humana, we believe great things are ahead of you when you start with healthy. and part of staying healthy means choosing the right medicare plan. humana can help. with original medicare, you're covered for hospital stays and doctor office visits when you're sick. but keep in mind you'll have to pay a deductible for each. a medicare supplement plan c

rbc capital says they are an urgent imperative to get pricing on the right footing.hing i think you would enjoy. looking at the treasury markets, they started to a bit of a wobble. the first one out of the gate was the three year note. it through the lowest bid since 2009. a bit of demand from treasuries. many say it's mere mathematics. others are saying this could be a red flag. deutsche bank's chief economist says fiscal crisis is begin with declining bid to cover ratios. nejra: you know how to float my boat. thank you so much, annmarie hordern and agad. today we' asking the questionre, when will the u.s. shutdown matter for markets? reach out to us. let's get to bloomberg first word news with debra mao in hong debra, hi. debra: hi, nejra. president trump says he will most likely declare a national emergency in regards to the u.s. southern border if congress doesn't agree to funding for his wall. with the shutdown entering its 20th day, the u.s. president flew to texas to rally support for his plan. the white house is considering whether emergency funding can be di

rbc capital says it is a clear rebound with the macro outlook for oil looking less dire than it did aeks ago. when it comes to other sectors, we are keeping a close eye on energy and investment firms in australia. bag.e seeing a mixed navigator global following the most in more than nine years as it sees impact from market volatility. when it comes to trade tensions we do have companies on edge. sony is reconsidering china production if tariffs rise. we did get a job listed numbers from korea and the labor cash earnings from japan coming in at 2% year on year. morford -- more for investors to digest. haidi: it is feeling very risk on on the moment. let's talk about asian trading as a gets underway. market joins us. this progress or semblance of progress, positivity in trade talks leading to quite a bit of risk on movement, seeing oil $50 a barrel for the first time since december and aussie jumping 0.5%. are there legs underneath this weak?or things week -- mark: their overriding sentiment is cautious optimism. we continue to see risk assets go higher. there is a hope we will get a ou

rbc capital markets managing director of equity research. your take? >> obviously a rough month citigroup number yesterday were down to about mid-teen. equities trading up 15% to 18% to so equities outperforming. i think what we saw was equities derivative benefiting from volatility. the prime business got hurt by that volatility. david: why is volatility helping? had message spread widening. there could have been some marks related to that. it will be interesting to see what theirn reports core trend is. and morgan stanley also expected to have relatively thenger just because of weaker comparison from a year ago. i think perhaps the volatility is help you in treasury. i think the currency volatility we saw coming into more of a january move. alix: what's your take? seeing a combination of factors with the jpmorgan numbers. their businesses that are tied to the capital markets. they are trust business with net income below expectations. they have to remember they had a one-time charge in these numbers. that certainly is a factor and was the final piece

we still have with us lori calvasina, rbc's head of u.s. equity strategy. the markets? lori: i think it is a bit of a sideshow. the pattern seems to be conforming from a market perspective, you fell off a little in the beginning, then bottom before it concludes. it is a bigger drama. there is elevated policy uncertainty. that historically turns into higher volatility in equity markets, so it will keep things challenging. david: it is not just the policy, but whether it can get implemented, because there is a clear policy from the president at the border. lori: i am not think it about the border wall itself, but the dysfunction in washington is something that is unsettling the markets. we do a survey every quarter, and we ask investors what is the number one thing keeping you up at night, and several surveys in a row it has been donald trump. alix: we have a nobel laureate joining us, robert shiller. we are talking about psychology. a government shutdown may not have material impact on gdp, but psychologically how long does it go on and what is the impact? r

thank you for joining us we appreciate it mitch steves from rbc. >>> still ahead, just minutes away fromteam ready to break down the results. but first, embattled utility pg&e filing for bankruptcy protection as it faces billions in potential liabilities we have the details when "closing bell" returns we know their rates are good, we know that they're always going to take care of us. it was an instant savings and i should have changed a long time ago. we're the tenney's and we're usaa members for life. call usaa to start saving on insurance today. >>> welcome back ebay just releasing the numbers. hey, d >> hey, wilf it is a beat on the top and bottom lines reporting for fourth quarter earnings per share up 71 krentds versus 68 cents. also revenue coming in higher than expected at $2.88 billion versus $2.86 billion a little light in the fourth quarter, 24.6 billion. 25.4 billion expected. they will return billions to shareholders over 2 years and it is initiating a dividend of 14 krentds. on the call we're listening out for what management says in any commentary regarding the activist cam

rbc is saying the walk back is not as bad as they feared.y that 3m, high quality defensive name that should outperform during economic downturn. even though we are seeing a lot of negativity in terms of chinese growth slowdown and global growth slowdown, with these two companies we are seeing positivity. haidi: and luxury also retaining. doing pretty well in u.s. trading despite the ongoing trade tensions between the u.s. and china. the domestic growth slowdown we are seeing in china. what are they doing to withstand all of these headwinds? ramy: this is surprising. this is really surprising because while we are talking about the chinese growth slowdown, when it comes to the engines for the revenues coming h, it comes from china. the ceo said basically that everything is firing at all cylinders. the ceo saying that the demand for fashion, leather and alcohol are all up. >> last quarter was growing faster in china. theink the main reason is ability of our products. ramy: who does not desire things cognac?nessee when we split this things up in

vm ware is winners >> tesla, three month low this morning as rbc cuts it to underweight. 245 target basicallystg and workforce and that's going to bring negative revisions. >> a lot of the bears have been saying to me, jim, how can you not go out there and just bash the heck out of it i think the answer is because i've been doing all this stuff about innovation and it keeps coming out amazon number one, tesla number two. i think tesla is overvalued. but the faith people have in tesla is just unmitigated. unmitigated. >> they argue that about a third of the price is an elon premium. if you take a 15 multiple, average asp, 55 grand of cars and that's assuming no capital. >> look, i think that that is the premium. when you go -- london, they have tesla rounds, where they get together and drive their teslas. that's the kind of thing that -- you don't see a lot of people going around with a chevy truck, doing it, right, doing a rally chevy truck rally. >> good point. >> number one, nice -- heavy, you know, super duty. >> super duty, got it. >> you know what is flying in the face of procter is kimb

rbc spoke about this, he said in a note if anything we won't see trickle effect of people leaving platformntil june. why? existing subscribers are not hit for the price increase for three months. it takes time to settle in, notice your bill. starting in june you might start to see or not, people leave the platform. nonetheless on your screen, seeing a year-to-date over the past little while, netflix stock climbed 40% in 2018. we're seeing investor today loving this price hike. the fact it is staying steady too. bringing up the debate whether netflix was undervalued for all the content it is providing. they said they're increasing the price because of original content. speaking of netflix and competition, talk about nbc. nbc is launching the own streaming platform by comcast. this platform will be free but it will be ad-sported for tv subscribers by comcast. not only comcast, if you're a dish subscriber, at&t subscriber, can get access to the platform launching in 2020. a opportunity for nbc to take away some at&t subscribers. nonetheless makes entire market even more saturated. this will b

>> i'm focused on downgrades, rbc downgrades united technologies breaking up is harder to do than peopleying is listen, some of the parts are 119, it will take forever and you have china issues this is the kind of thing that makes me gain theorists who loves opera like i do. >> they have a lot of business in china. >> i want something other than new mining to be a high, david. >> all right what do you have on "mad money"? >> i'm going out west to do the conference. >> i know you are. >> and i have lisa gill running the conference from the research side just to give you a preview. it's the most important conference i know of. >> everybody goes. >> everybody goes. >> except me. >> david, any time you want to go to me to california -- >> i don't believe it. >> i'm bringing my wife. she's so focused on the show she likes the shopping >>> coming up, we have powell, yellen and bernanke at the american economic association annual meeting we'll bring you live coverage. >>> good morning welcome back to "squawk on the street." i'm sara eisen with david faber and contessa brewer live from post 9 at

they'll play it any time anyway, few stocks on the move this morning rbc downgrading utx.res are likely stuck in limbo the analyst says there could also be a transaction involving carrier before then but the potential upside is not enough to keep the firm more positive we'll also keep an eye on apple this morning a dire revenue miss yesterday -- warning of a miss blaming a slowing chinese economy for the shortfall is intensifying fears or maybe kevin hassett expects more companies to warn of shortfalls. >> i speak regularly with people at wall street this is something people have seen coming. the chinese economy is slowing and one of the reasons why markets are responding the way they are is people are downgrading the earnings forecast for folks that have a lot of business in china >> and we're going to hear from kevin hassett this afternoon when he joins cnbc live at 2:00 p.m. eastern >>> helping us get ready for the final jobs report of 2018 or the first jobs report of 2019. >> it's the final one reporting numbers from last year but first one we do during 2019. >> okay.

. >>> wells fargo was upgraded to sector perform from underperform at rbc capital markets the bank sharesu see them also to start negative >>> when we come back, washington and your money. the balance of power in congress will start tomorrow and a partial shutdown continues we'll tell you what you need to know about the beltway that is next right here on "squawk box. what do advisors look for in an etf? i tell clients, etfs can follow an index, but which ones target your goals? it's not about quantity. it's about quality. no trendy stuff. i want etfs backed by research. is it built for the long-term? my reputation depends on it. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. i am a techie dad.n. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools that simplify your experience. my name is mike, i'