Steven mnuchin steps in for new york bancorp. And boeing having issues are regulators over the door plug blowout. Its thursday, march 7th, 2024. Youre watching Worldwide Exchange right here on cnbc. Good morning and welcome to Worldwide Exchange. Thank you for being with us. We get you ready for the trading day ahead. The major averaging snapped a threeday leez losing streak. This action in the premarket after we heard from jay powell saying he continues to expect Interest Rates to come down this year, but not ready to say when yet. It will depend on the path of the economy. Our focus is on maximum employment and price stability and the incoming data as you look at the outlook. We checkfor treasuries. We continue to watch yields throughout the hour. We are watching the Energy Market and oil with wti hovering close to 80 a barrel. Tensions in the middle east continue to rise after the Houthi Missile attack yesterday that killed three on the cargo ship in the gulf of aden. Take a look at the oil market. Oil is moving lower down. 75 for wti and brent crude. We have to talk about metals. We dont talk about them often, but they are close to highs. That is the story with gold. Gold is up more than 5 this week. Trading at 2,165 an ounce. Up. 30 . Gold is close to an alltime high. That is the Morning Money set up. We have a news alert for you. Details this morning ahead of President Bidens state of the Union Address tonight. The white house revealing that the president will call for denying Corporate Tax breaks for all salaries over 1 million. Companies cannot deduct ceo and cfo executive salaries. This would expand the rule to the new 1 million threshold. Looking to 21 for the Corporate Tax. The projections from the white house indicate that the biden plan would cut the deficit by 3 trillion in the next ten years. We will have more on the state of the Union Address coming up later in the show. Time for the check of the top corporate stories with silvana henao. Silvana. Frank, good morning. Just hours after federal relaters called out boeing for failing to cooperate in the investigation of the january door plug blowout, boeing is providing names of the employees on the 737 max door team. Before the boeing reply, ntsb representative in the Senate Testimony yesterday characterized the cooperation so far beyond disappointing. Exxonmobil is putting chevrons deal for hess at risk. Filing the claim yesterday suggesting it may counter chevrons offer for hess Oil Properties in itguyana. They are saying they have the right to counter the offer for the hess stake in the guyana project. One of the largest oil finds in years. We are watching shares of new York Community bank after the session yesterday. All this before enclclosing 8 higher after the deal with several investment firms, including former treasury secretary Steven Mnuchins firm. Thank you, silvana. See you later on. Turning attention back to the markets. Jay powell back on capitol hill today for a second round of testimony on the economy and Monetary Policy. This time in front of the Senate Banking committee. Powell telling house lawmakers yesterday he expects Interest Rates to come down this year, but is not ready to say when. The fed chair added the fed is looking for more consist moves. Because of the progress we made, we can approach that step thoughtfully and confidence. When we reach that con ifidence means can dial back the policy. June is the first rate cut. Traders are pricing in a 55 chance of a. 25 move. Lets talk with Jeremy Schwartz at wisdom tree and sophie lundyates. Jeremy, we saw the markets finish higher after the jay powell testimony. What does that indicate to you about traders confidence in the cuts . We were saying the market was getting excited and started pricing in sixtoseven wcuts. If the fed doesnt price in the cuts, we will have a tough time of getting gains in the market. We said it wasnt about the cuts, but willingness to cut if there is weakness. We were worried to say inflation is the top concern. We cannot say. He showed the flexibility. We think inflation is lower than reality with the housing data and realtime housing is down 1 . You get updates on that. We think he should be cutting, but i think the data is coming in in a way to allow them to start cutting in it june. Jeremy, you have come with alternative data on inflation in previous times. Sophie, over to you. Do you agree with jeremys take this gave the confidence the cuts are coming and is this enough to keep the rally going . Theres no doubt, really, that cuts are going to be coming through. I personal thinly think there i disconnect when it happens. When you look at the labor situation as things are moving in the right direction, but we are in a situation where the labor market is hot. When you look at the consumers behaving with amazons strength in the retail strength. The willingness to spend on disc discretionary items is hot. They are not committing to a timeline of when the cuts are going to happen. In terms of equity valuations, absolutely. Were in the Holding Pattern in terms of seeing any kind of meaningful gains until we get a clearer trajectory on the timeline. Sophie, it is interesting you say that. Valuations have not seem to put pressure on the markets this year. Now with what seems like more assurance from jay powell that the cuts are coming, we had the chief economist who is one voice saying the cuts may not come. You are saying valuations are an issue for the market . I think in some corners, yes. We are probably over the worst of the severe jitters. I think rather than looking at it through the lens of were going to see the bottom fall out of the prices, i think we are talking monumental gains and further gains coming this year. I think it will rest on the trajectory of when we get more meaningful sentiment coming out of the fed. That said, cof course, that can change in short notice. Im looking forward to april. Jeremy, back over to you. You dont have any trepidation of looking overseas for opportunity. We have seen japan. We have seen a runup in the japanese markets. Different story there. Different central bank situation. Why is now the time to turn to japan when we have the confidence from jay powell of cuts in the u. S. Coming . Coming back to what your other guest said. 5 earnings yield. Nikkei is at alltime highs of 40,000. When you look the flagship equity product, it is a 14 pe ratio. It has been performing better than tech stocks in the u. S. It has all of the tailwinds behind it. The negative rates getting off to zero. Very much a different situation. You have Warren Buffett continuing to talk about why you should buy the stocks, not the currency. That is what dxj does on top of that. It is the combination of valuation and a new sentiment break to the 40,000 nikkei level. Dxj is the japan hedge equity fund. Sophie, you are also looking at the ecb decision. You are looking at ueurope. The valuations there are attractive. Absolutely. You cant forget the growth trajectory outline isnt necessarily the most exciting, but i do think europe is harboring quite attractive names that have been forgotten. Particularly at the moment, one thing this taught us is there remains a lot of uncertainty around us. That is go back to basics. There are companies with strong sectors and wide economic moats. Im thinking about the telecoms. Then you have defense. If you hop over to the uk, as much as we have some broadbased productivity challenges here, i would say when you stoyou startk away at the financial sector, we have a lot of options. A lot of uk banks are trading below the value of assets. We will talk about european stocks later in the show. Jeremy and sophie, thank you very much. We have more to come here on Worldwide Exchange, including the one word that investors have to know today. First, you heard of thing magnificent seven, but what about the super 7 . What citi says could outname those are wall street. And europes Digital Markets act goes into effect today. And foot locker losing ground over the Holiday Season and the stock isinng ski. We have the big money movers coming up when Worldwide Exchange returns. Stay with us. vo what does it mean to be rich . Maybe rich is less about reaching a magic number. And more about discovering magic. Rich is being able to keep your loved ones close. And also send them away. Rich is living life your way. And having someone who can help you get there. The key to being rich is knowing what counts. You can make money the hard way as a bullfighter or a human cannonball. Or save money the easy way, with xfinity mobile. Existing customers can get a free line of our most popular unlimited plan for a year not only will you save hundreds but youll also be joining millions who have connected to americas most reliable 5g network. Sure is a lot safer than becoming a stuntman for money. Get a free line of unlimited intro for a year when you buy one unlimited line. Visit xfinitymobile. Com today to learn more. You heard of the magnificent seven. The tech stocks dominating the markets with the market weight and performance. That group up more than 80 over the past year compared to the s ps 28 gain. Citi is out with the list of stocks all european based which says shares similar characteristics to the magnificent seven. Lets bring in the super 7. It sounds like a superhero team. Good morning. Good morning. We will show everybody the list. Asml. Lvmh. Schneider and richemont and novo nordisk. What made you put the list of stocks together . What is the characteristic of the super 7 to our magnificent seven . What we noticed this year is there has been an interesting dynamic playing out in the European Market. European markets are doing well. Out performing the u. S. It is happening with the narrowing of the returns to these few stocks. We heard about narrowing in the u. S. Last year. It did not happen in europe. That is a new dynamic. There is a catch up of the European Market from the perspective. Of course, caveat here is i would like the broadening of the market with circumcyclical marke is a normal situation we are having righto the catch up of last year. The risk is the market narrows further this year and then we search for the characteristics of the magnificent seven that we could find in the European Markets. We looked for superior growth and superior margins and also for economic moves. These are the companies that tick these boxes. We will continue it show the list. Novo nordisk with a 52week high on trial data. It is hard to not see it is very different from the magnificent seven, the super 7 is luxury spending. How should we read that . This is what i like about the european super 7. It is more diverse from the sector perspective than the magnificent seven really crowding into one theme. You have the a. I. Play in europe in the super 7. Are you talking about s. A. P. . Yes. Asml as well. Industrial play with schneider and then the three consumer stocks. Two are luxury or three of them are luxury. They have the right characteristics for the narrowing, but further down the line, the Economic Data improves and the Central Bank Cuts and we argue it is a environment right for the broadening of the equity market. The cyclical market of the super 7 stocks are in could onwell. Here in the u. S. , we are looking for our central bank to cut. How important is the Central Bank Cut to the stocks and equities in general . They are very important for the european equities in general and the european economy. Our view is we will have five cuts from the ecb this year. Five from the fed. An important point for what will happen next over the medium term, not the near term is the early cycle dynamics. We are seeing it in europe. The data is not great in europe, but improving. We see more and more evidence we are the cyclical trough or we already hit it. The super 7, the european answer to the magnificent seven. We will continue to track those stocks. Thank you for being with us. Coming up on Worldwide Exchange, the countdown to the ecb decision tod aaynd will it follow the fed playbook of higher for longer . Stick with us. Welcome back to Worldwide Exchange. We are looking at apple and the fight with epic games. Apple blocking the video game maker from launching on iphones and ipads in europe. Regulators are looking at a historic day for the tech sector and possible ry for consumers. Steve kovach joining us. Steve, what is the latest with the battle . This is the Digital Markets act, frank, known as the dma. It is hours old and apple is testing the limits this morning. The European Commission is investigating apples compliance with the dma which includes fees it wants to charge and kicking epic games out of the apple store. This has lots of rules here with the attention on apple because it is the most profitable and the most resistance to regulations like this. The dma forces apple for the first time to allow thirdparty apps to reside on the iphone and make it easier for users to choose a default web browser. Apple announced how it will comply with the law. That angered Companies Like spotify and epic which wants looser rules. Similar to the mac or windows computers. Now regulators will have their say if apple is complying with the new law and if they find apple or any other company in it violation, they could be fined up to 10 of the global revenue. Lets put a big number on that. For apple, that would be 40 billion, frank. 40 billion for a fine . Thats interesting. When is it going to be a decision or ruling on all this . What is the process . Can apple appeal . What is the next step . This is novel, frank. Apple had compliance with the law and the eu could not enforce it because the law went into effect today. I can refer back to the dig at that time cerdigital services a which is investigating in january about some content moderation problems around the war with israel and hamas. That has been taking months as well. It could be some time before this plays out. Apple will do everything it can to drag its feet. We know you will follow it. Steve kovach, thank you. Coming up,if the suit doesnt fit. Why shares of hugo boss are heading for the worst day in eight years. Shares down 17 . If you havent already, follow our podcast. Check us out on apple or spotify or other podcast apps. More Worldwide Exchange coming up after this. It should be called wiffle tennis. Pickle yeah, aw whoo these guys are intense. We got nothing to worry about. With e trade from morgan stanley, were ready for whatever gets served up. Dude, you gotta work on your trash talk. Id rather work on saving for retirement. Or college, since you like to get schooled. Thats a pretty good burn, right . Got him. Good game. Thanks for coming to our clinic, first ones free. My name is oluseyi thanks for coming and some of my favorite moments throughout my life are watching sports with my dad. Now, i work at comcast as part of the team that created our ai highlights technology, which uses ai to detect the major plays in a sports game. Giving millions of fans, like my dad and me, new ways of catching up on their favorite sport. It is 5 30 a. M. In the new york city area. There is more ahead on Worldwide Exchange. Heres whats on deck. Stocks facing pressure after wall street stops the slide with modest gains yesterday. Futures are fighting for gains right now. Details emerging on President Bidens agenda for the state of the Union Address tonight. Top of the list is Corporate Taxes. We will dig into other areas for the president and what it means for your money. New York Community bank fighting to stay afloat announcing a capital injection and leadership shakeup ands we approach one year since the sizable shock to the sector. It is thursday, march 7th, 2024. You are watching Worldwide Exchange here on cnbc. Welcome back to Worldwide Exchange. Im frank holland. We pick up the half hour check of the u. S. Stock futures after the averages snapped a threeday losing streak yesterday. Futures are in the green across the board. S p moved into positive territory firmly with the dow moving in positive territory as well. The nasdaq in the premarket up. 25 . Yesterday, chairman jay powell set to resume testimony today after telling lawmakers the central bank needs more data before it moves on rates. It is a very important step we think because of the strength of the economy and labor market and progress we made and we can approach that step carefully and thoughtfully and with con confidence. The expectation, as we will do so this year, dial back restrictions on policy. We are checking treasuries. The benchmark at 4. 1 . We will continue to watch the yields. We are also oil with wti hovering close to 80 a barrel. Tensions in middle east are rising after the houthi attacks killed three aboard a cargo ship in the gulf of aden. Take a look at the oil market. We are seeing oil move lower this morning down. 75 for wti and brent crude. Lastly, we have to hit gold with fresh record highs. Moving about. 25 higher. Gold trading at 2,160 an ounce. Thats the Morning Money set up. Lets turn to a news alert. Details this morning on President Bidens state of the Union Address and the topi