I was looking at friday and the tenyear yield on friday was 4. 795 . That is a significant drop. You can see the extended drop here as things opened up. It was the same story across the board with the 30year yield. It closed 4. 895 . Below 5 . You look at where the board is today and go back to what we had up with the tenyear yield and 30year at 4. 85 . The twoyear yield at 4. 99 . The biggest move in crude oil yesterday. Wti at 86. 17. Lets update you on the war in israel. Israel saying the border with gaza is now secure. The spokesperson saying no hamas territories crossed into israel since sunday night. The Health Ministry said 687 people in gaza and the west bank have been killed. That does not include 1,500 bodies of hamas militants which have been p found in israel. Hamas threatened to execute hostages if they were bombed without warning. In the meantime, President Biden confirming yesterday that 11 americans were among those dead. No americans are confirmed to be hostages. U. S. National security spokesperson john kirby saying the number of americans unaccounted for and they could be among the hostages. President biden is set to address the American People this afternoon from the white house. We will bring you that live as it happens. Later this hour, we will hear from the former commander of nato and then in the next hour, bob kraft will talk to us about the uptick in antisemitic rhetoric. I dont know if you saw it. It is disgraceful. I am jewish and i dont know what to say. Im not and i dont know what to say. It is shocking. We have seen protests here outside the windows of people saying stuff. It is unbelievable what is happening. It is unbelievable to see the response. I guys ill say it on the air. I had a discussion with becky. I need a chart to show me where people come down on these things. How far left do you have to go to where with you are saying stuff like that. You saw larry summers. I asked him about it. I saw the memo before the show began yesterday. Is it you can go so far left and if you view someone disenfranchised and that is where you lay your chips and you are enabling hostages . I want to take it out of politics. I dont think it is a leftright or thing. I think confined to that group of people . It seems to pme if you look around the world and go to australia and you go to different parts of the europe where the protests are happening and parts of the United States, i think it is an extremist view. I dont understand. Certain places where you expect outrage. Did you see amari . I did not. Not everything is for discussion here. There are issues where you can see the good and the evil. I guess there is nuance from occupied . Any time you talk about kidnapping grandmothers and babies and killing people and raping people, it is easy to see whats wrong with that scenario. If you cant see the evil there, then i dont know what to say. It traces back to an occupation. I guess there are western countries around the world that have people in them that think israel shouldnt exist. We have neonazis in this country who have this view who wave flags on behalf of President Trump, for the last how many years. Take the politics out of it. There have been horrific things said in this country for the extremist things for years that were not condemned properly at all despite the for israel and all of the support you would see. If you talk about why people feel this i dont understand it. I dont either. Why people feel this and are allowed to say these things and there was not condemnation. There was not you were not sitting at this table screaming about those people and saying those things four or five years ago. People were, but not doing it enough. They were not. I have a clear picture of the rise in antisemitic rhetoric. They count on twitter and count when elon musk said something as antisemitic. They were putting it in. This is clear at this point. You see the demonstration. I still dont think that the group you are talking about in this country is the biggest threat to security in the United States. President biden said white s supremacy. I think the biggest threat to israel is islamic extremism. Some people captnt say that. President obama never uttered the word. Why not . Ill not defend those positions. This is alterable. It has to be called out all the time. You think the biggest threat to the United States is White Supremacy . Do you realize the way you are saying it, it appears you are defending them. Thats the point. The biggest threat. Thats the point. Once it becomes normalized in any way im not saying that. It is a small percentage. I would not say that. There is a Terrible Group of people in this country that are saying these things and that is terrible and lets leave it there. This is what we will talk to bob kraft about this morning. He is talking about what the nfl is doing to raise awareness on these points. Pepsi just reported. They are always adjusted. It was above 215. They reported 225. Revenue of 23. 45 billion. The company raising earning guidance for the full year. We will talk to pepsi cfo Hugh Johnston in the 7 00 hour. Atlanta fed president bostic and Christopher Waller and Neel Kashkari will speak out today along with San Francisco mary daly speaking out with the forum as well as prime day kicking off which is set to run through tomorrow. Look for a good deal. When we come back an, we will talk more about treasury yields dropping. It is just happening as the bond market reopens after the holiday yesterday. We will dig into the inflation data and earnings. That is next. You can see the tenyear yielding 4. 6 . Coming up at 8 00 a. M. , we will speak with paul ryan about the ouster of Kevin Mccarthy from the speakership. You are watching squawk box and this is cnbc. Announcer this cnbc program is sponsored by baird. Visit bairddifference. Com. With gold bond. You can age on your own terms. Retinol overnight means. The smoothing benefits of retinol. Are now for your whole body. Plus, fastworking crepe corrector diminishes wrinkled skin in just two days. Gold bond. Champion your skin. This is Spring Semester at fairfieldsuisun unified. They switched to google tools for education because theres never been a reported Ransomware Attack on a chromebook. Now theyre focused on learning knowing that their data is secure. nice footwork. Knoman, youre lucky,ta watching live sports never used to be this easy. Now you can stream all your games like its nothing. Yes [ cheers ] yeah woho running up and down that field looks tough. Its a pitch. Get way more into what youre into when you stream on the xfinity 10g network. The markets will get another round of inflation data this week. The Producer Price index tomorrow and Consumer Price index thursday. Treasuries resumed after the holiday yesterday. We dig into it with maryann bartell and steven parker. Steven, lets start with you. We are watching yields that opened up lower. It has had three days since we have seen trading. A lot has happened in the world. Do you think we are looking at this rush into treasuries because of the geopolitics and what is happening around the globe in israel or is this a situation of the fed speak where they say the market has been doing its work for us . The kneejerk reaction is political, but the fed speak will ultimately drive the direction. Yesterday, u. S. Fixed income markets were closed, but etfs tr traded. They rallied on the news this weekend. It was the dovish comments from the fed speakers that got the rally to kick into gear in the second half of the day. Mary ann, i know you have been preparing for higher for longer. I dont know what that means for your portfolio, but look at things pulling back where does this settle out . I agree with your guest that originally the horrible events over the weekend were the initial driver of the move in rates. I think some of the fed speak is deliberate because we dont know what direction this is going to take. We could have treasuries being used as a flight to safety for a period of time. It is possible that we reached an intermediate top. If we get very good inflation data this week, that will help rates. What we mean by rates being higher for longer is that were normalizing. We are not going back to that zero. We are in a higher Interest Rate environment in the years to come. That will fluctuate. You will have periods where rates are going up and periods where rates are going down. If we have reached an intermediate top for rates, this is bullish for the equity markets. The only negative we see for the markets is if crude breaks above 100. If you get crude above 100 and sus sustainably above there just because lets run through that. Because it slows the economy significantly or it ends up playing a force on inflation beyond just core inflation as it works through and that forces the fed to raise rates again . I think it is both, becky. Higher crude Oil Prices Hurt earnings and at the end of the day, that is what the market will respond to. It will also hurt the consumer. If Higher Energy prices spike, then you just cant respond that quickly so it has a negative impact. Stephen, equities were up yesterday which is a little surprising with the events over the weekend. I guess the market is assuming this is going to be contained and this is not something continued or just too hard to figure out so you put it in the too tough pile . It is hard to anticipate where this is going. History gives uses a clear road map on geopolitics and the impact on markets. You get a quick kneejerk reaction. There will be an eye on the middle east, particularly as mary ann said there is contagion in the oil markets, but it will shift to earns ings this season. That outlook looks good. We think we bottomed out last quarter and we accelerate the story which is supportive of stocks. You dont think there is a hard landing coming . You think the economy is going to look okay . We think we will witget a so landing. It will slow, but not to the point of major recession. That will take the pressure off inflation and the fed and be a good thing for equity markets. They will make new highs by the middle of next year driven by Earnings Growth and not valuations. The selloff has given us a cushion on the valuation side. Mary ann, do you agree . I do. I think what we are not talking enough about is the ism manufacturing data. It is actually improving. We are not above 50, but it looks like manufacturing has actually bottomed. Inventory alone will have to be rebuilt and prices paid are falling. It is really a positive mix now, we think, in manufacturing. We think that will help boost earnings. When we look at margins, we think companies can improve do earnings next year. As long as crude oil doesnt spike higher and stay higher, we think the outlook remains robust. I agree we would reach new highs next year in the marketmarkets. Stephen, you think this pull back is an opportunity . We think it is an opportunity. We remain focused on the u. S. We like the story within industrials. We think there is a lot of support for the industrial story. We are talking about taking a look at equal weighted s p exposure and midcap names. A lot of the rally is driven by the magnificent seven. We through there is a catchup trade across the markets. We are moving down the capitalization spectrum. Not all the way down to small cap. We do like the midcap story. Technology story. You think that has been overplayed with the magnificent seven and what has happened with a. I. . I dont think it has been overplayed. There is a longterm story there. I think we are looking for a rotation in terms of market leadership away from the concentrated leadership of the mega cap tech story to the broader market. Mary ann, how do you play this . What do you tell investors . Would you keep money in cash or deploy heavily . In terms of cash, our clients have just been flooding into cash because they havent had a return. They want to have that income. Im not sure i could stop them if i recommended not to go to cash, to be honest with you. To us, technology is the leadership of the market. If you are going to continue to have the secular bull market, you need to have the leadership in tech. Amazingly, tech is still out performing on the relative basis in the decline. That tells Us Technology will continue to lead us out of this. I think you have to own tech. We have been focused on s semiconductors and software and services. I would agree sdril industrials the emerging leadership. Mary ann and stephen, thank you. We will see you both soon. Thank you. Coming up on squawk box, Country Garden is defaulting as the Property Market continues to decline. And you dont want to miss this. We will hear from Paul Tudor Jones. He will join us at the table on set to discuss everything that is going on from the war now in israel and some of the geopolitical issues and Federal Reserve and kocommodities and more. You dont want to miss it. Squawk box is coming back after this. Fisher Investments in this market, youll find Fisher Investments is different than other money managers. other money manager different how . Arent we all just looking for the hottest stocks . Fisher Investments nope. We use diversified strategies to position our clients portfolios for their longterm goals. other money manager but you still sell investments that generate high commissions for you, right . Fisher Investments no, we dont sell commission products. Were a fiduciary, obligated to act in our clients best interest. other money manager so when do you make more money, only when your clients make more money . Fisher Investments yep. We do better when our clients do better. At Fisher Investments, were clearly different. In the u. S. We see millions of Cyber Threats each year. That rate is increasing as more and more businesses move to the cloud. So, the question is. Cyber attack as cyber criminals expand their toolkit, we must expand as well. We need to rethink. Next level moments, need the next level network. [speaker continues in the background] the network with 24 7 builtin security. Chip . At t business. Announcer executive edge is sponsored by at t business. Next level business need the next level network. Welcome back to squawk box. Country garden failed to make an International Debt payment and said it doesnt expect to meet all of the bond obligations when they come due or within the grace period. This means they are going to be defaulting. The company says the decline was accelerated by the 81 dropoff of apartment sales in september. The downfall could escalate the property crisis in china. It is one data point and it comes as the Developer Evergrande Group has yet to deliver hundreds of thousands of apartments it presold to chinese citizens. Yesterday, evergrandes creditors said the debt restructure deal could lead to the collapse of that company. A lot to watch in china, joe. Coming up, House Republicans holding a forum this afternoon to discuss plans to elect a speaker. Mccarthy had a big speech yesterday. Did you see that . I saw bits and pieces. Not ruling out. He is open to the idea. I dont know how it would work. The eight are still around. Maybe he has more support than the two candidates running. If you split it up in the conference, it is unclear how it works out with jordan and scalise. Well talk to the pollster frank luntz after the break. As we head to break, here is the look at yesterdays s p 500 winners and losers. Announcer winners and losers is sponsored by state street global advisers. The biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. It still does. What can you do with spy . swords clashing had enough . Whatno. Arthritis. Spy . Here. Aspercreme arthritis. Full prescriptionstrength . Reduces inflammation . Thank the gods. Dont thank them too soon. Kick pain in the aspercreme. Ever since she was a little ki, all maria wanted to do was bak. Im maria alvarez, owner of marias cakes. And im axel, proud to be her state farm agent. Her baking superpowers have brought sweetness to our community. I make delicious cakes to make special occasions even better. Maria doesnt just bake; she also creates opportunities. Small businesses like marias, open doors for communities to thrive. Support your community. Support small business. Good morning. Welcome back to squawk box. We are live from the Nasdaq Market site in times square. The futures are higher once again this morning. You are talking about the gains following yesterdays gains for the market. Dow futures up 83 points. S p futures up 10. The nasdaq up by 55. Getting help from treasury yields which are open again for trading after yesterdays holiday. You are seeing a bit of a steep pullback from fridays close. The tenyear yield is 4. 6 . Gop house members holding a Forum Tonight to try to help pick the next speaker of the house. Joining us on the chaos in the house is frank luntz. Good morning to you. It is chaos. Lets talk about the chaos. There are two pieces of chaos. Chaos in washington with the leadership vacuum right now which we could some people could relate to the speaker issue, but the leadership vacuum of the United States in is rea we are in unchartered ed territory. Businesses look for predictability. They look to be able to know our government will function and the people are in place and we cant guarantee that any more. Two candidates running. One get majority. I hear from other members, Kevin Mccarthy is a friend of mine. I want to ac