it is 5:00 a.m. here at cnbc global headquarters. here are the top "five@5." we begin with new week and new fortunes stocks look to bounce back after the worst week of the year. and warren buffett has a message for the dividend haters out there in the annual address. and the merger monday. big money movers coming up. we take a closer look at the struggling u.s. housing market later on, it has written

college essays and the valentine's day love letter, but can it plan your vacation? it is monday, february 27th, 2023 you are watching "worldwide exchange" here on cnbc good morningm welcome to "worldwide exchange." i am frank holland let's get a look at trading. dow and nasdaq and s&p in the red. they are coming off the worst week in the year all falling between 2 and 3% all three are .50% higher this morning. nasdaq is doing best out of all of them. in the bond market, yields aring mo moving higher. 2-year treasury at 4.84% still the inverted yield curve last week, it ended up against

the 4% yield on the 10-year treasury to energy, oil is steady near $76 wti at $76 brent crude at $83 a barrel. natural gas is something on we continue to watch. up 1% this morning currency is up the dollar is climbing slowly. up more than 3% in february. we are seeing it is up 1.5%. it is in the big roise in february coming off the best week since september. speaking of currency, we are watching crypto. we are seeing bitcoin and ethereum trading lower this morning. bitcoin below $25,000 mark which is key ethereum is down fractionally this morning solana is down as well this

morning. and in asia, it is red across the board and 1% losses in australia europe's trading day is getting under way. right now, a lot of green in europe cac 40 up along with the german dax. let's get to the top corporate stories with silvana henao. >> berkshire hathaway reporting the profit fell8% in the final three months of the year to $6.7 billion. for the year, profits were up 12% to just under $31 billion. berkshire bought back8 billion in common stock. warren buffett releasing the annual letter to shareholders. among observe ations were those against buybacks and pfizer is in talks to buy seagen the deal would bolster pfizer

cancer treatments. seagen was in talks with merck last year, but they failed to reach a deal and the house is getting ready to hold talks about the train derailment in east palestine, ohio. among the issues how the government supervises large rail companies, frank. >> silvana henao, thank you. back to a very busy trading week ahead with the slew of corporate and economic data on tap. that includes retail and home sales. fear may be making a return back to the market. we are watching the vix rising above 23 last week this as the latest cboe data shows call options betting the vix will rise or trade at the

highest rate since march 2020. joining me now is robert schein. great to have you here >> good morning. >> let's start it off. we mentioned the vix with the spike in february. down 11% in january. up 11% in february what is creating the fear in the market >> it is a lot of the uncertainty. we have geopolitical uncertainty and uncertainty from corporations they have been honest reporting the last quarter of last year with the inflationary pressures. last week, the market sold off with the re-pricing of the higher numbers which pushed rates higher that is what we are seeing with the vix moving higher interpreting the data. >> one of our second favorite word last year after transitory

is bifurcation trying to look for opportunities and sectors and stocks what are you watching for? there are certain metrics? is it free cash flow is it margin is it profitability? >> in this marketplace, you want to go with the large caps. you want to look at excess free cash flow and earnings with the bifurcation in the market, there is an opportunity to play capital and opportunity right now, especially on the geopolitical uncertainty in certain areas with the aerospace and defense sectors. >> you are saying there are opportunities in the aerospace and defense sectors. one of the picks with the one-year anniversary of ukraine conflict is the aerospace ticker ppa. what is that one of your picks >> if you think about it, every

country in the world is spending more money on defense. allocating capital if you think about it for the retail investor, most are under allocated. this is an opportunity to re-balance in the uncertain time the vix rising a lot of uncer uncertainty. we capture a diversified approach to balance out and put defense into the portfolio ppa. etf is a great broad-based diversified approach to add defense. >> other picks are exxon and microsoft. i have to leave it here. robert schein, thank you when we come back on "wex," teeing up the busy week for retail with key data point on tap, we look at the state of real estate one of the biggest tech

shows in the world is the mobile worldbarcelona we have karen tso with more. >> the chinese are back in a big way. all of the major players are here there are plenty of devices here we will talk about the advancement of 5g when we come back stick around ♪♪ ♪when the day that lies ahead of me♪ ♪♪ ♪seems impossible to face♪ ♪a lovely day (lovely day)♪ ♪(lovely day) (lovely day)♪ ♪(lovely day)♪ a bank that knows your business grows your business. bmo. man: i'm not slowing down anytime soon. that's why i take osteo bi-flex every day. it's clinically shown to improve joint comfort in 7 days, and continues to improve over time. kinda like us.

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well come back.

the mobile world congress is kicking off in spain we have karen tso on the convention floor you are in the middle of it. what's going on? >> reporter: frank, this is day one. i have to say the crowds are back it hasn't been an event that has run smoothly for a number of years. covid one year and the war in ukraine last year. the devices are very much coming through this year. we are seeing it from a number of major players looking to the future don't forget with the smart phone market, last year was the worst year in a decade with shipments. they are changing the way the phone feels in the hand. foldables market is 1% so far. it tells you how much more territory there is to claim in foldables. and trading down by consumers is a feature that some carriers are

talking about. tough economic environment means it is a split market some are going for the high-end devices. others want to save money with the smart phones that is what they are targeting now. i mentioned 5g heading into the break. some investors piling in early to the 5g story. that has been slow to materialize. one of the problems is the north america market was doing heavy lifting with the rollout china's access has not been great in recent years. that left india. a lot of equipment makers are going after 5g there many are going after the enterprise market and also industrial users >> you were talking about foldables. that is interesting. you mentioned china. how are geopolitical tensions playing in china's return?

>> reporter: it is very much there. i'm in front of the chinese player and it tells you how dominant the presence is this year this was spun out of huawei. that is where the trade and technology tension began roll forward to the conversations on capitol hill about restricting access of chips from huawei. the company is on the ground here still coming up with innovation. the chinese are major players. they are going after market share in the smartphone market it is not just smartphones, but the future with a.i. chinese are huge players in the a.i. this is where the u.s. has tried to slow china down this is a huge talking point with chatgpt chinese have their version of this with ernie bot. the textnsion is there the issue is now with russia and push for security networks cybersecurity is a major issue.

>> we will talk about cybersecurity later on in the show karen tso, thank you coming up here on "worldwide exchange," from term papers to art. a.i. and chatgpt is everywhere what about planning your vacation we will have more when "worldwide exchange" returns

welcome back to "wex.

the housing data is on tap this week we are looking at rising rates and supply chain disruption. joining mow to discuss this is lawrence yun great to have you here. >> thanks for having me. >> we will talk about rising rates and impact i want to talk about the housing market overall pre-pandemic, there was a char shortfall of housing how are we now >> you are right there was a shortage pre-covid then the real estate boomed with the interest rates and the shortage intensified in 2022, because of rising rates, home sales declined furthermore, apartments went gang buster. 40-year high activity. we have a residual shortage of

housing. now 4 million. >> this is something we will clip for social media here are prices falling right now we know rates are rising when the rates rise, prices are supposed to fall are the prices falling and will we get back to the rates we saw in early 2021 at 3% or 4%? any chance >> national median price is up 1% in january compared to one year ago it is still up that is the national average you look at individual markets for example, san francisco, seattle have prices falling, but at the same time in other areas like atlanta and other fast job creating areas, prices are rising i would see modest price gains and other parts of the country with decline with exceptions >> i think you dashed a lot of

hopes. people were hoping you would say rates would fall right now, we are entering what used to be pre-pandemic which is the spring buying season are we seeing a similar pattern this year? >> it is driven by the direction of the mortgage rates. the past week, some bad inflation numbers or inflation remaining stubbornly high which is keeping the mortgage rate elevated once inflation comes down, marge rates should be more attractive for the remainder of the year which will have steady growth in home sales buyers understand the long-term wealth potential from homeownership and we have the housing shortage the housing shortage will not go away consequently, is it a buyers market or sellers market it is time for negotiations.

>> i'm ready for one myself. we are showing the board with the economic reports with housing. is there one in particular that is especially important that will give us the biggest insight in the housing market with the changes? >> mortgage rates are the biggest driver the second is the job creation america is still creating jobs the potential or pent-up housing demand is built up it is about the mortgage rate to make homes more affordable once the mortgage rate drips down from fed, you see the reopening of the gates for home buyers to reenter. it is not a frenzy 20% price gains? that will not happen steady at 3%, 4%, 5% annual gains are plausible. >> thank you, lawrence yun time for the check on the

other headlines with phillip mena in new york >> overnight, strong winds tore through the southern plains. the national weather service reported multiple tornadoes in oklahoma there were no reports of injuries, but there was damage to homes and gas and power lines north of i-40. 54,000 households are without power this morning. and in california, it is still reeling from heavy rain and snow this weekend. 51,000 remain without power there. a mudslide damaged homes in los angeles county on sunday afternoon. the san bernardino fire department is warning residents in the mountains not to travel as roads there remain closed due to heavy snow. big bear lake saw the snowiest three days on record at 57 in

inches. two sources with direct knowledge told nbc news, they believe it was not likely it was generated from the wuhan lab republican senator dan sullivan called for more hearings on the matter. and dilbert has been dropped after the creator went on a racist rant. elon musk weighed in on the media. that's it, frank >> phillip, thank you. as we head to break here on "worldwide exchange," we are watching the shares of disney with "ant-man and the wasp" which set a record in all the

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right at 5:30 a.m. in the new york city area we are just getting started here on "wex. a very busy trading day ahead. futures are bouncing back after the worst week in the year. the consumer report is ahead this week. we look at retail numbers. and chatgpt is asked to plan your next family get away. that is coming up on this monday, february 27th, 2023. you are watching "worldwide exchange" here on cnbc welcome back to "wex." i am frank holland let's check on the stock futures after the dow logged the worst week since september futures green across the board nasdaq is the best if the markets opened an this

point, dow would open 100 points higher futures are higher, but we are watching the fear gauge, vix, raising above 23 last week you see the big spike in february some of the fear is driving the market the latest cboe data showing the vix will rise. certainly something to watch the bond market is showing yields with the 2-year treasury and 5e-year at the highest since november we also want to hit oil. pretty much staying steady we saw at the beginning of the show, wti at $76 brent crude at $83. natural gass is something to

watch. up 1.5%. time for a check of the headlines with silvana henao >> frank, union pacific plans to replace ceolance frits lz this year in the letter, the company says union pacific lagged behind the peers and the change is overdue. the board has been working with the leadership consultant to identify the best candidates for the job. warner bros. discovery is suing over south park. it paid paramount more than $500 million for streaming rights to new and exclusive episodes on hbo max.

it put it on its own service the production company is named as a defendant and the creators matt stone is not. twitter cut more jobs over the weekend. the wall street journal said the scope of the cuts is unclear, but platformer reports the head of twitter payment who oversaw the twitter blue plan was let go as most of the remaining product team >> silvana, thank you. turning attention to earnings season. the consumer is front and center a number of names are set on report chief among them is target cnbc reporter melissa repko is joining us now >> frank, as you said, target is one ofof the retailers reporting this week. the company's outlook is at risk

the sales soared in the early years of pandemic, but missed wall street earnings expectations three quarters in a row. profit margin has been hit by markdowns as it cleared through the unsold goods that piled up and people bought less inflation changes and people pull back on purchases for target, that led to the change in the market the stock has fallen 40% from the all-time closing high which it hit in november of 2021 investors eager to see if target can break the streak or meet or beat expectations. the company is expected to report $1.40 in adjusted earnings per share and $30.7 billion for the quarter. what target will project for the quarters ahead and expected to report full guidance tomorrow morning. >> a lot to watch with target.

certainly target is not the only company reporting. a number of retailers reporting. including kohl's what are you looking for >> kohl's and macy's reporting this week will give us a window of how consume recenrs are spenn areas where they cut back. that is vulnerable as people feel the squeeze lowe's is reporting on wednesday and home depot missed guidance last week. it is worth noting lowe's lags behind in home improvement >> lowe's has a bigger diy consumer base. with the housing market stagnant, how does that impact lowe's >> a headwind and tailwind on the one hand, people are reluck ctant to move.

on the other hand, they are tackling diy projects. i can't move i want to stick with the fixed mortgage rate. i want a nicer bathroom or spruce up the kitchen or paint job to make it feel fresh. >> i'm doing a little stuff at my house i wish somebody would create an app to match your paint. i digress. and we have sephora and amazon with the drop off at kohl's. this is a tailwind for increasing sales >> that is one of the ways that kohl's has been trying to draw in foot traffic. it is the subject of activist investors lately it has a new ceo amazon has done one, but it opened beauty stores are sephora. that is another way to get creative to draw foot traffic as it struggled to draw in shoppers and sees categories get weaker.

>> i have visited kohl's i look to buy makeup we're on tv. melissa, thank you so much great stuff. >> thank you time now for the top trending stories this one comes straight from cnbc.com this is chatgpt. term papers and love letters, but how about your next vacation we have monica pittarelli has that live on cnbc.com. she is here right now with the a.i. inspired itinerary. >> there were hits and misses. that is what i discovered with chatgpt. the first thing i asked was can you help me plan a beach trip for my family in march it said sure

it said i think you should go to hawaii, florida, costa rica or asia i said i want amazing food in that case, it said you should look to malaysia, ho chi minh city i had one more ask i want to avoid crowds it said you want to limit it to bali specifically, the northern beaches of bali. not the south. >> number one. fascinat fascinating. chatgpt is planning a vacation like i would melissa is here. you got back to thailand >> i did go to crab by it is off the beaten path.

it did a good job with ideas there. >> i agree with the food list. i'm a fan of malaysian food and bangkok has incredible food. i have been there myself monica, would you turn to chatgpt to plan your trip or get on a travel site and do it yourself >> if you read the story, there were plenty of mishaps along the way. it was fun and fast. if you have been chatting with customer service and whoever you are dealing with gets up and walks away from the computer because they disappear, it doesn't do that. it is quick. it wasn't always correct i would say if you want to use it, double check what it says before you make any bookings >> i love to plan trips, in my head, but when it is time to do the leg work, it is tedious. can chatgpt actually book the trip does it have that level of ability? >> no, i desperately hope it did. it does not.

the data on it is accurate up until september of 2001. there has been so much that changed since that time period it is promising. i think travel agents jobs are secure for the time being. >> monica, thank you you have to send us pictures from the chatgpt inspired vacation after you get back. >> will do coming up, the cyber sector is struggling of late, but one is out performing in the group we have an exclusive with the ceo. that's coming up next. it infrastructure with ai . now your systems monitor themselves. what used to take hours takes minutes. and you have an ecommerce platform designed to handle sudden spikes in overall demand... as in actual overalls. ♪♪

welcome back to "wex." let's look at the yearly s&p ga gainers. tesla up 1.3%. warner bros. discovery is up nvidia is up year to date. looking at the laggards. lumen technology is down moderna is down 22%. pfizer is down 20% year to date. turning to the cybersecurity space. stocks have been performing well this week. check out the cybersecurity etf. it is up 8% year to date

tenable is up 14% year to date chairman and ceo of tenable is joining us in the exclusive. amit yoran >> great to be here. >> we are looking at the performance up 14% year to date. what is the environment right now with cybersecurity >> one thing is the environment is healthy if you look at the internet and the number of attacks offline and how critical i.t. systems and data are to companies around the world. there is a lot of concern of security that is healthy. >> by the way, your company is 5% of the holdings in the b.u.g. etf. part of the big rise there also i want to talk about a.i. your company is using a.i.

currently. how do you use a.i. and are your customers asking more about a.i. with cybersecurity >> at tenable, we use a number of technologies to help organizations to determine exactly how vulnerable they are to cybersecurity exploits. we use a number of vulnerabilities and we use a.i. to see which are exploitable this is one of many techniques and many applications of a.i. in cybersecurity. we hear about it from customers, but one of many things we do. >> i want to talk about another holding in b.u.g. etf that stock is 8% of the b.u.g. i want to play a sound bite and get your reaction over the comments about a.i >> i like to talk about sonnets

and the revolution it will drive in advertising and it will inform up the demands which are far exacting >> the demands from your customers. what is your take? it sounds like he said we are using a.i., but it is not ready for primetime. >> he is right of it is not ready for primetime. if you look at the environment, you see a.i. which can be tricked and it happens online with the general purpose a.i it is not mature enough to make the critical decisions in enterprise environments. >> we hit this earlier in the show is the rise of the dollar in february which is up 3% t tenable gets one-third of revenue outside of the americas.

are you hearing about the rising dollar and costs >> i think there is a concern about cost as the dollar rises we transact in 160 countries in the world. it makes the goods and services more expensive on the flip side, it makes operating expenses where the dollar can go further. at the end of the day, it is important for businesses to have that global footprint and diverse base of customers who are being more resilient and more challenging and dynamic in the environments. >> amit yoran, thank you. as we head to break, during february, we celebrate black heritage with teammates and business leaders here is former federal reserve vice chairman roger ferguson

>> my heritage and culture being african american male has had an impact on my career. the main thing is it is focused in on areas where blacks have been disadvantaged the real focus on financial security and financial literacy and retirement savings that range of topics it is important for everybody, but particularly important for african americans who have been forced to be at the bottom end of the income and wealth spectrum anything to do to overcome all tyears of discrimination is really important. ♪upbeat music♪ ♪♪ ♪when the day that lies ahead of me♪ ♪♪ ♪seems impossible to face♪ ♪a lovely day (lovely day)♪

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welcome back a quick trip around the world on "worldwide exchange. s six stories you may have missed at the 6:00 hour warren buffett bought back $8 billion in common stock last year. and china renaissance breaking the silence of the missing ceo. the shares try to bounce off record lows this month.

and hitachi is planning a multibillion dollar hiring spree. sppfizer is in talks to acquire seagen for $30 billion it would bolster the cancer treatments shares up 15% and pfizer is down 2%. axios is reporting a round of hearings over the response to the toxic train derailment in ohio chinese smartphone giant xiaomi is launching 13 pro the hand sets feature tech from cqua qualcomm we are warning earnings from fisker and zoom video.

and kristin dolan becomes the amc ceo. we have the home price index and consumer price index happening this week. also on tap is investor days for goldman sachs. arguments to the supreme court on the biden student loan forgiveness program. earnings from kohl's and lowe's report this week on thursday, a big day with earnings from kroger and nordstrom among others with jobless claims out for the week. and services pmi is out on friday and president biden will welcome olof scholz to the white house on friday. we are coming off a difficult week here on wall

street if we opened right now, the dow would open 140 points higher and the yields are moving higher the 2-year treasury at 4.814 the inverted yield curve is something we need to watch energy with wti above $76 a barrel watching natural gas which is up 1.5% the dollar is coming off the best week since september. up 1.5% year to date up 3% alone in february. and then cryptocurrency with ethereum and bitcoin solana is the hardest hit down almost 3%.

let's get to erin gibbs. great to have you here i can't hear you, erin can you hear me? >> yes >> the magic of television we have been talking about the vix and vix up double digits in february alone how is that influencing the market >> it has been up for two weeks. i would suggest there is more fear out there a lot of the news we have seen hasn't reassured investors it increased fears of further rate hikes one of the things we know is when we break -- >> we will welcome in sam stovall into the conversation now. >> thank you, frank. >> you are doing a blended mix

of fundamental with different sectors. what is the blend? >> obviously cfra is a fundamental equity research shop i try to add value through technical analysis i like to say fundamentals tell you what with, but technicals tell you when and how far. realizing that only 10% of the nearly 150 sub industries in the s&p 1500 are up in february. the question was how many are still above the t10-week and 404 40-week moving average we have been satisfying a weakening of participation, they are still holding upaudience, wo

ge get erin gibbs' audio issues resolved sam, are there certain areas or sectors you are staying away from we saw a big jump with the risky names. cloud computing and the ark innovation are you confident they can rally or are you switching gears >> no, i think if your time horizon is a year out which cfra analysts focus on, then you have to expect the fed to stop raising rates in june and market advancing across the valley into 2024 and we got a good sneak peek, if you will, in january, as to technology and financials

and also looking at communication services the growth areas did pop in january. i think a year from now they will end up being leaders. the first half is fairly volatile and as erin will talk about in a minute, the vix being elevated as well >> you are looking for leadership right now, you feel this rally and trend may come to an end you are talking to insurance stocks you are seeing opportunities there. break that down. >> when you look at those groups that perform the best over the last market high on february 2nd, three of the top five are in the insurance area. multi-line, property casualty and re-insurance groups. that area that is also above its 10-week and 40-week moving average is the insurance

category one is e vrks everest re. we have seen the heightened geopolitical risk. pricing has been firming in the area everest re is the stock we pick. >> another is voya financial is this a rate story or is there another factor >> it is a rate story, but a company that focuses on retirement plans and so many baby boomers retiring in the several months ahead voya is a group that will be ben benefit. financials and technology are above the 10-week and 40-week moving averages. we have favorable

recommendations. >> we have erin back i want to ask about the s&p price target 4,575. how do you see that playing out? it is a rocky february do you see the rest of the quarter playing out with upside? how do we get to the 15% rise? i'm sorry. sam, that was in our target. >> gosh, how does erin have a target just like mine? he s essentially looking for the growth this year into next year and the cap weight differentials. >> we will leave the conversation there sorry about the technical difficulties erin and sam, thank you. thank you for watching technical difficulties that will do it for us here on "worldwide exchange. "squawk box" is coming up next

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good morning stock futures at least so far pointing to a higher opening on wall street. a busy slate of retail earnings this week. warren buffett blasting corporate buybacks calling them illiterate or semi-tongue d demegogs and more layoffs at twitter after several rounds of cuts

since elon musk took over. it is monday, february 27th, 2023 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm rebecca quick along with joe kernen and andrew ross sorkin. everybody get your jacket ready. i have the jacket today. you are jealous. >> it changes the dynamic. you are not doing it it's only been 27 years. we'll change it. come on, andrew. >> it actually, the jacket should be reserved for special