The nikkei was off by. 10. Hang seng managed to edge higher by 1 3 of a percent. Shanghai comp down. 4 of a percent. Over in europe, take a check there. We have red arrows aside from italy which is managing a. 6 percent of a gain. The dax is down by half a percent. As for treasury yields, it seems to be in focus it has been in focus as we are waiting. Fed chair jay powell might say about a potential rate cut in july the twoyear now 1. 925 . Quite a steep rise considering that the recent low is 1. 696 . 195 on a close. Amazing yields. Obviously stretched lower in trade news, top u. S. Officials, talks back on the hill the first high level talks with the chinese counterparts yesterday. They continue to try to work out a trade deal people close to the conversation say both sides are going to continue talking but that existing tariffs could be, in their words, the new normal. Netflix is losing another high profile tv property next year friends is moving to warner streaming service hbo max. This is a second big blow to netflix. Cnbc Parent Company comcast announced the office is moving the fresh prince of bel air, joes favorite and pretty liars. They didnt announce a subscription price for hbo max i think the question here is is netflix really facing finally that competition that everybody had been projecting but in the next couple of years we have disney plus, hbo max, you have a comcast streaming. Disney content and all of the rest of it and all of these things. Right. I guess what we dont know now. We know that its a huge source of from from the users, time spent on netflix and all the rest what we dont know is what filters into the subscription decision. Thats all that matters. The background stuff. The stuff is still in reruns on regular tv. Thats true the office was the number one streamed show on netflix friends was close after that. Which validates what netflix did years ago. Thats true friends could seem put it in terms of something i could understand. Of your generation . M. A. S. H. Thanks. Im just trying to understand where youre coming from. Bewitched. Honeymooners. Wkrc. No. Seinfeld, you can watch it. Thats true is it the same with friends . All appears where rogs ss h was already married. It wasnt your show. No, it wasnt. That you grew up with and im concerned about the wellbeing of some of the former stars of friends as well with some of the pictures im seeing. Were all getting old but, wow, what happened to that one guy . What was his name, Tyler Chandler are you okay, are you doing all right . Hows courtney. I havent seen a picture. Shes good. They all are. Sure. What are we talking, yearly income do you think . I dont know what that could be in royalties. Obviously warners got to pay them even though its within the same company, you have to pay a market rate for the rights. I know ross ive met ross a few times. I was sorry to see he was shoplifting over in england, remember no, kidding. He was a guy it was he tweeted out about it yeah, geez, i was over in yeah picked up on it. He was very funny about it. Did it not look like him looked a lot like him we are traveling weve been exposed to the same. Is that what it is . Cultural content . Not everyone has. What was the one, our break through moment i cant remember do you remember it so touching no, no, no. It was the best in show reference. Yes i was here for that about starbucks. It was a very special moment. Did you they met in starbucks, these two what canny people, but they didnt do it wow, big digression. Hunl. Back on track. Impossible to get back on track. Well try. Stocks to watch this morning, levis reported a drop in Second Quarter profit due to a drop in the ipo. They beat forecast but shares are down sharply today as the company says sales growth will slow in the second half of the year on weakness in the wholesale business set to go down 7 . Tmobile will replace red hat in the s p 500 on july 15th ibm completed the 34 billion deal on wednesday. You wonder how long t mobile will remain. Exactly well hear about sprint. Rachel by far the most successful post friends. With a living line of hair care products. And the recent netflix movie, bringing it back home to what we talked about. She looks the same. Murder mystery. Where is lisa goodreau phoebe . Phoebe. Do we agree Jennifer Aniston has taken it furthest . I dont know. Its pretty hard to argue that other guy had a show for a while on one of the streaming services that was pretty good. Joey did how you doin yeah. All right hotel chain marriott has been sued by the district of columbia over allegedly deceptive drip pricing. Tack on hotel fees marriott has failed for a decade or more to disclose fees the fees could add up to 95 a day. The d. C. Attorney general seeking a court order to force marriott to advertise the full price for a stay to pay financial penalties and restitution to guests. Marriott does not comment be on pending litigation. Separately, marriott is facing a potential fine from the u. K. s privacy watchdog. The regulator said marriott hadnt conducted proper due diligence. The breech happened two years before the acquisition they said they would contest the ruling and it is cooperating with the regulator. Coming up, firing up the capitol hill grill fed chair jay powell will answer questions from lawmakers well get you ready for the potential market moves straight ahead. As we look ahead, were looking at the dow when it comes to your customers expectations, theres one thing you can be sure of. Theyre changing by the nanosecond. Thats why cognizant created a unique engineering approach to design and build new digital products. Learn how cognizant softvision designs experiences and engineers outcomes. Cool. But were also a cancer fighting, hiv controlling, joint replacing, and depression relieving company. From the day youre born we never stop taking care of you. Here, hello starts from thewith hi mple. How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Well, as weve been saying, fed chair jay powell is headed to capitol hill later this morning to testify before the House Financial Services committee. Hes expected to make the case that the fed is ready to cut Interest Rates as needed but hes unlikely to reveal how soon or how far the cuts could go powells prepared testimony will be released at 8 30 a. M. Eastern. Well bring that to you. Now kristin viverly and our guest host, Jason Trennert after the jobs report you did not change your viewpoint that wed get a 25 basis points cut were basically expecting that there will be a 25 basis point cut. The market is obviously pricing 100 probability of that were really reviewing the data on a daily basis today and tomorrow are critical. Whether theres any guidance whether that 25 basis point cut will be taken off the table. Given the Market Conditions it will be difficult for them to do that. Weve got pretty solid gdp. I dont know what its going to be the rates are low and headed lower. Whats not to like i know. Theres a lot of data where when you think of the traditional playbook its hard, right . Economic data is good. Theres everything that weve seen in terms of theres really no clear sign when we look at that traditional playbook for the fed to cut rates. That being said, the signaling and the Market Pricing at 100 probability, hawkish surprises have been very rare. When we look at the percentages, in about 7 of cases versus 80 that the fed does what the market wants it to. Maybe we dont get it you know, the big picture and, you know, were so used to being worried, maybe we dont see that inflation is so low that were in a place where we can leave rates low and enjoy better Economic Growth. We got so used to 2 growth. Everyone tells us thats the best we can do there were times when we did better ma inwe an, jason, but is ther a time to stay long . Theyre quite good. The only problem the fed really has is that you have 13 trillion of negative yielding, sovereign debt, which is up 7 trillion from last september so its not a closed system. Thats the only problem the fed really is dealing with, which is to say i agree with you, joe, but by the same token the fed cant be completely blithely unaware of whats happening in the Financial Markets itself so if you have lets say if you have an inverted yield curve of three months two years, there are things the fed probably has to do. Dont say you agree with me im just making the point, i think i can go to the other side immediately and tell you this is one big Massive Central Bank orchestrated bubble that bond markets, stock markets, i read people that believe that very seriously. They were in territory with the stock markets, very vulnerable. As weve talked about before. The dollar winds up really being the governor on the engine for how quickly the fed can tighten. I think the fed might not like to admit it or other people might not like to admit it, but the president was right. In my opinion the fed probably tightened one too many times last year. I think the markets reaction right before Christmas Eve last year was a pretty good indication of that the s p fell 9 in four days so its probably not bad, as larry kudlow said, take some insurance. The last move in any sort of cycle of a move that that move in december should be taken back and should be sort of negated. But, kristen, in terms of how you position, it seems like theres a huge risk, you said its very unlikely that the markets wouldnt get the cut because fed funds futures are 100 that seems like a number one risk the market is sitting at practically record highs that we get hawkish testimony. That he starts saying, you know what, to break the cycle of the markets leaving the fed, Jerome Powell could come out today and sort of walk that back a little bit. Thats an opportunity exactly. When we look at the economic data, the jobs report, obviously that was almost an argument not to cut, right . We saw the market adjust having 50 basis points on the table and then 25 basis points really being the only option. So right now the only thing that could talk the markets back is today and tomorrow so powell will have to actually signal to markets that we dont need this cut at this point in time i think the market is going to look to the longer strategy. Do we see that a recession is imminent no we at citi maintain a bear market checklist where we look across 18 different factors. Right now only four of them are flashing slightly red. Its the ones that you would imagine. Its basically leverage on Balance Sheets its the inverted yield curve. Everything else is actually quite positive to put that into comparison, in 2000, it was 17 out of 18. In 2007 it was 14 out of 18. By the way, this doesnt tell us the direction of markets, it just tells us, should you buy the dips if we see a pull back, buy the dips. If this whole system was a 25 basis point move in december away from the difference between a good market, a decent economy, an acceleration, what do you pay for that market . Is it really because were talking about flat earnings for the first half of this year. What multiple do you put on a market that could be knocked off course by 25 basis points. Thats why were advising our clients right now, it sounds very traditional but its asset allocation, diversification. Dont wait on the sidelines. Dont wait on the sidelines. But we must remember, you could never have your money with her. I dont think any of us could. This is trennert this is the citi private bank. Im not private were public kind of people. Were all public. The people youre talking about are the ones that have a target on their back they have so much money already that were thinking about like a wealth tax you, too, trennert, im looking at you. Youre saying yes easy for you to say stay long. All your clients are everyone. Well have a discussion. They could keep the bear market checklist to themselves but they dont. One of the mistakes theyve made regardless of your net worth is staying in cash. Whats a minimum people need to get in with you so we cover the ultra High Net Worth clients. Oh, boy. Ultra ultra. Well talk about those people because were after them were going to have a debate later with the American Centers for progress tell your clients we dont know what to do with the money. Portfolio. We dont know what to do with the money were going to take from them. Piss it away like we always do. Lets talk cash, though, this is important for markets when we look at the carbon the sidelines, whether its corporate cash, whether its household cash, there is 12 trillion of household carbon the sidelines. Theres another 4 trillion in corporations another 1 trillion with private equity funds thats 70 of the s p market capitalization. You stay right until 7 00 because we never hear this stuff because we cant get into this technical but thank you. Youre more than welcome. Any time. Jason, you might take her aside. You have i dont know if i have the chips. What does ultra mean . 25 million. Whew 25 million. Okay. Coming up, boeings disappointing numbers could show disappointing numbers on the leader board. Plus, amazon locking up a cosmetic deal with lady gaga squawk box will be right back. You should be mad they gave this guy a promotion. You should be mad at forced camaraderie. And you should be mad at tech that makes things worse. But youre not mad, because you have e trade, whos tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean. Dont get mad. Get e trades simplified technical analysis. Facebooks ahead of its Digital Currency project libra is calling for more regulation david marcus says the Company Needs government, central regulators involved to properly launch libra theyre set to testify before congress is that not enathema to everything theyre talking about . Begging for oversight. Can you hear yourself i do hear myself. I do hear myself. Check the price. I understand the rationale. Now you understand. Thats not what it is cant you use venmo or a debit card he came from paypal, david martin. Thats when this sounds like. It sounds like crypto. What youre selling. Im appropriately intimidated. You know what, once i said shhh to dennis kidding around with him, people now have these reptile they think people came from other planets and theyre like reptiles. Theyre nuts theyre crazy. Can we agree on that . Okay. We agree on a lot. After reporting no new 737 max orders, boeing is set to lose its standing as the largest plane maker to airbus. Jet liner deliveries fell by more than 1 3 after the grounding of the 737 max boeing has lost 50 million in market value you can see the divergence. Lady gaga is making a big bet on cosmetics the brand is called house laboratories it will launch in the u. S. , germany and japan. Amazon embraced her message of selfacceptance and of course this is a push by amazon to push further into cosmetics challenging alta and sephora. I dont know anythingabout makeup. What . You wear it every day. Sure you do. Try not to wear everybody wears makeup. I need as much help as i can get. Really . Its he hard to reveal the top states for business in the top of the hour. With a rundown of all of the diabolical hints weve had heres a look at yesterdays s 500. Through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. From finding out whats selling best. To managing your fleet. To collaborating remotely with your teams. Giving you a nice big edge over your competition. Thats the power of edgetoedge intelligence. Welcome back youre watching squawk box live from the Nasdaq Market site in times square. Good morning u. S. Equities futures at this hour down 72 on the dow. Those are some of the worst levels weve seen since we came in anyway this morning the s p indicated down about 10. Nasdaq indicated down 32 nasdaq and the s p both diverged managing to eke out small gains. Well see what happens later. 3m was a big issue for the dow. After the european markets closed you have european rallies. Today is the big day we will reveal cnbcs top state for business in the 8 00 hour. Scott comb joins us live from the winning state. Where are you . Dont you know its early here in the top state for business thats where i am, the top state for business let me tell you what were going to do today. This is something we are now doing for our 13 year, americas top states for business. There is a real study as the day goes on. The plan is that in the next hour on squawk box we will give you runners up states 5, 4, 3, and 2 you will see how our state stacks up. All day yesterday if you were with us we were giving you our patented diabolical hints. Lets give them to you one more time where is the top state for business our lips are sealed, nuts to you, time of my life, surfing u. S. A. And dont fear the reaper were getting some great guesses. The hatch tag is topstates. You dont want to miss the next hour for when this countdown starts next hour is 5, 4, 3 and 2 and the top state will be revealed we will talk with the states governor in the next hour. You have pants on, right . Thats the first question you have for him you know oh, my god. In fact, dont never mind. I dont none of those clues make any sense to me. Theyre more confusing. I got more confused he always does that. Diabolical. You know, we have had people figure out from landscapes where he is. Hes in a tent i mean, this is like i mean, theres absolutely and we cant tell if its dark outside. He tweeted a picture, there was a sunrise. What time in. He tweeted it six minutes ago. See, thats cruel but you dont know when i took it. Diabolical. Anyway, coming up, morningstar initiating coverage on six cannabis stocks. Youre looking at 4 of them. Well, there they are looking forward. The topics as well as the prediction for the future of legalization thats next. Squawk box coming right back at comcast, we didnt build the nations largest gigspeed network just to make businesses run faster. We built it to help them go beyond. Because beyond risk. Welcome to the neighborhood, guys. There is reward. Beyond work and life. Who else could he be . There is the moment. Beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. Take your business beyond. In washington today a House Committe