it is 5:00 a.m. at cnbc global headquarters. here is the "five@5. investors looking ahead to the final week of the first half of the year and looking to extend last week's losses. this after a wild 36 hours in russia and the greatest threat to vladimir putin. and peehere as home, alliese sorting through the ripple effects for the ukraine and russia conflict. and president biden set to kickoff a new push for his

infrastructure agenda today. we are looking at the stocks involved later in the show, drilling down on the sector surging. this has nothing to do with big tech or a.i. it is monday, june 26th, 2023 you are watching "worldwide exchange" here on cnbc good morning welcome to "worldwide exchange." i'm frank holland. thank you for starting your day with us. let's check on the u.s. stock futures as we get set for the final trading week of the first half of 2023 we see futures in the red right now. if the markets were to open right now, they would open lower. the nasdaq's first down week in the past nine. the two-year note hovering at

3.28 the 2-year treasury is surging a lot of traders going there for safety cryptocurrency look at bitcoin above the 30,000 mark ethereum is below the 2,000 mark up fractionally this morning we start with the top story. investors on edge after the weekend in russia. some calling the armed rebellion of vladimir putin is the biggest in two decades oil trading as high as $70 a barrel and now turning lower wti and crude below $70. wheat is popping russia is the world's largest exporter wheat right now is up 2.5% up double digits the last week

nbc's kelly cobiella is live in kyiv what do you see, kelly >> reporter: good morning, frank. we have not seen vladimir putin since the extraordinary statement on saturday when he vowed to crackdown on the rebellion happening in real-time in russia. we have, however, seen his defense minister and ministry of defense in russia putting out video showing him meeting with troops in ukraine. we he cannot confirm when or where that video was shot. another unknown this morning, the status of prigozhin. the head of the wagner group of mercenaries. the group that led the rebellion on saturday. he was promised a safe passage to belarus he has not been seen since the overnight hours of saturday when

he was in video leaving that southern city in russia that he and his troops had taken over during the extraordinary 36-hour rebe rebellion. in a short clip of prigozhin, he was heard saying the result of the rebellion was quote decent we shook or cheered everyone up. again, telegram channels are sigh lent for the last 36 hoursd no sign of prigozhin that incredible and extrao extrao extraordinary rebellion took place in 36 hours where prigozhin lambasting the russian military and establishment claiming the justification for the war in ukraine was based on lies ukraine and nato never planned to invade russia then moving his troops from ukraine across the border and into russia and taking over the southern city and taking over

the southern command for the war in ukraine then sending his fighters north close to moscow. what impact will it have in the battle field in ukraine? still unknown. we probably won't know, frank, for days or weeks to come. >> kelly cobiella live in it kyiv for nbc news. great reporting. good to see you. let's get a sense of how europe and asia is handling the volatility we have julianna tatelbaum live in our london newsroom with the early trade. what are you seeing now? >> frank, we ticked higher at the start of trade this morning, but equities have turned lower and sentiment soured we have losses across the regions here the under performer is the italian market down 1% otherwise, .50% down for all of the regions. on top of the investors reviewing the developments in

russia over the weekend, we have german business morale which was downbeat the ifo institute which puts together the survey data suggests that a downturn in q2 or recession in q2 is likely increased. that adding to the downbeat picture on friday with the flash pmi. in terms of asian trade, also downbeat hang seng closing .50% lower shanghai in china closing 1.5% lower. the global sentiment has taken a hit had this morning in terms of focus for european investors, eurozone cpi this week and the ecb forum this week frank. >> julianna tatelbaum live in our london newsroom. thank you. let's keep this going with

skylar montgomery koning with the latest >> good morning. >> the brief rebellion in russia is adding to the questions about what the fed will do and possible recession how do you think investors should look at everything this week with the final trading week of the second quarter and first half of the year >> it is interesting we are in the environment where data is distorted. it is coming in all over the place. there is the possibility of the soft landing or a hard landing or this no landing scenario. we switched to data dependence by the central bank especially with the fed pausing the market is trading off what is happening with the expectations of the fed and other central banks, but highly trading data which is volatile it is a hard trading environment. >> i think a lot of people are saying that, including you a lot of volatility and different factors. if you are going to talk to some of your clients or other people today, how do you position the

second half of the year? >> it is hard because we're having this euphoria within the equity markets especially the u.s. equity markets. a lot of that is dealing with the a.i. and tech rally. that is a bubble because we don't have the liquidity backing it it is a good story and there is potential for growth, but it is not unwarranted the equity upside i think people under-position the melt-up in equities. at the same time, recession is coming and it is worrying for risk assets. >> i want to talk about something people are looking at here is the inverted yield curve. red part hshows deeper inveinve. what do you think? are there sectors you would stay away >> this is a telltale sign of

recession. it depends which part of the yield curve. the 2/10 inverted first. that is less sign of recession it is not as accurate. the 3 month-10 year has 100% accuracy the fed's preferred measure and the forward spread is inverted the thing is you don't know how far after inversion you get recession. there is not a huge correlation to the deepness of inversion in terms of deep inversion tells you the market is expecting more cuts from the current point or growthto slow more it doesn't tell you the exact timing, but what it does tell you is that on average 12 months after the 3 month/10 year, you get recession. the longer you go, the more worried you are. >> skylar, thank you i appreciate you being here. more to come on "worldwide exchange," and including the one

word that investors need to know and the impact on the energy markets with helima croft. and president biden is set to kickoff the infrastructure agenda today we are looking at the stocks involved. later, merger monday alabl out private equity and big tech the full story in a very busy hour when "worldwide exchange" returns. ♪ ♪

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? ♪ ♪

welcome back to "worldwide exchange." showing you the futures in the red. it has been a wild ride for a.i. stocks as recession concerns dampen sentiment on other parts of the market. magnificent seven index includes nvidia and microsoft and alphabet managing to gain last week still, there are questions of the sustainability of the a.i. rally. the rally for stocks could slow in coming weeks due to liquidity coming from the system the use of the emerging technology is accelerating globally president biden and chuck

schumer both speaking out last week about regulation of a.i however, europe has taken the lead drafting the eu a.i. act through the eu-u.s. trade council where the trust of the a.i. was in focus. they were holding a meeting on that last month including the eu regulator and commerce secretary and my next guest part of the panel. jonas andrulis is joining me now. good morning >> great to be here. >> we laid out some of the landscape, jonas you sat across from brad smith and the u.s. commerce secretary. what direction is a.i. going in and how will it help your business and your ability to partner with businesses in the

u.s. >> there is a lot of movement in the sector i'm speaking a lot with brussels and berlin not so much with the u.s in that meeting, we were looking at existential risks, but what it means for businesses. there are risks on different levels there is an existential risk where people are afraid a.i. will take over the world there is a sudden near-term risk on applications like medical devices and stuff like that. the a.i. -- the european union has led the charge here and drafted an a.i. act. they are changing it all the time there's a draft, but it kept changing and they kept adding a new category for foundational tech technology it is messy. there are many groups in germany and europe warning this could throttle innovation.

>> it is an unclear path forward. a.i. is the leader with generative a.i i want to ask a tough question crunchbase data. your company raised over $30 billion. i have to ask, with that war chest for open a.i., how do you expect to compete? how can anybody compete with that money and backing of microsoft? >> that's a great question of course, we will raise more money. not $10 billion. the challenge here is really not microsoft against a an leph alpha. we are partnering with the e enter enterprises. we are partners against some other players. s.a.p. and more to come. the question for a.i. sovereignty is not aleph alpha

>> we see this will transform every company. where do you see the next leg of a.i. making a meaningful change to an enterprise >> the risk now is the copyrighting in chatbot. you can create value with that the stuff we are working on goes further. it is handling complexity and driving business processes and going in use cases where you need trust and complexity. that's really what will happen next this will have tremendous impact on value capture and creation. >> how important is it to have large language models trade in europe compared to silicon valley in the u.s. when it comes to selling yourself or other companies to larger companies

like hp? is the difference important or having those a.i. capabilities >> the location of our headquarters is in hieidelberg. we are working with partners and international partners they don't care where our postal address is located they care that we offer a full stack sovereign solution alternative to the hyperscale to the cloud. from the european perspective and european government, we care about sovereignty as we should from the perspective from the customers, it doesn't matter where we are located >> jonas, thank you for joining us with european regulation and the future of a.i. >> thanks for having me. as we head to break on

"worldwide exchange," check out byd. crossing moments ago warren buffett said it sold shares for $86 million shares of byd down .50%. we're back after this. across the globe, industries are transforming and businesses need to navigate the changing landscape

to stay ahead. when you partner with barclays, every change leads to a bold possibility. you have the vision. we have the insights, financial solutions and global perspectives to help you make it real. barclays corporate and investment bank powering possible.

(vo) this is sadie, she's on verizon. the network she can count on. corporate and investment bank and now she's got myplan, the game-changing new plan that lets her pick exactly what she wants and save on every perk. sadie is getting her plan ready for a big trip. travel pass, on. nice iphone. cute couple. trips don't last forever, neither does summer love. so, sadie is moving on. apple music, check! introducing myplan. the first and only unlimited plan to give you exactly what you want, so you only pay for what you need. act now and get iphone 14 pro max on us when you switch. it's your verizon.

welcome back to "worldwide exchange." look at futures right now. futures in the red right now nasdaq down .25% dow off the lows from earlier. right now looking to open up 41 points lower we want to look at the pre-market movers. taking a look at the nasdaq 100 laggards tesla among the names down 2%. alphabet in there and airbnb down 3%. nike shares down in the pre-market we are seeing microsoft on the list of the goldman sachs among the names there. chevron turning positive in the pre-market looking at the corporate stories with silvana henao good morning, silvana. >> good morning, frank apollo is making an investment of $2 billion in the chipmaker wolfspeed. sources say the deal would make

$1.25 billion available immediately to wolfspeed with another $750 million that could be drawn at a later time that debt can be paid after three years. the deal could be announced in the coming days. opec says global oil demand will rise to 110 million barrels per day and that is an approximately 20 years the secretary-general saying this morning that oil is irreplaceable for the foreseeable future it will comprise 29% of the energy mix by 2045 opec adding the underinvestment in the industry will challenge the viability of the current energy systems and lead to an energy chaos and ibm is reportedly close to the deal to buy cloud based software company apptio.

sources close to the matter, the wall street journal says the $5 billion deal is more than double what vista paid for the company five years ago if confirmed, the deal would help ibm further its push into cloud computing services throug apptio platforms frank. >> silvana, thank you very much. straight ahead on "worldwide exchange," first it was james bond now aston martin is partnering with another big brand with an ev push in mind. if you haven't already, follow our podcast on apple or spotify or other podcast apps. more on "worldwide exchange" after this

it's 5:30 a.m. in the new york city area we are just getting started on "worldwide exchange. stocks looking to extend the sizeable losses as investors look ahead to the final week to the first half of 2023 futures are in the red wall street, washington and kyiv looking at the deal that ended what is being called the greatest threat ever to vladimir putin. the sector on the move and it has nothing to do with big tech or a.i. this is all about the g.o.a.t. trade. it is monday, june 26th, 2023. you are watching "worldwide exchange" here on cnbc

welcome back to "worldwide exchange." i'm frank holland. thank you for starting your day with us. let's check on the u.s. stock futures. futures this morning are in the red across the board nasdaq is the hardest hit. down lower nasdaq down .25% dow off the lows from early this morning. this as investors are gearing up for the first half of 2023 and the q2 earnings season this could be ugly analysts are expecting a third quarter of falling profits with earnings forecast to fall by 6.5% now that would be the worst performance since the second quarter of 2020. remember the pandemic. for the third quarter, analysts expect corporate per share profit to rise 0.7%. for the fourth quarter, an 8%

year over year gain. time for the look at the biggest upgrades and down grades kicking off tesla from neutral to buy the stock is better reflecting the positive view. goldman adds it is aware of the difficult pricing environment for vehicles tesla down 2%. ubs downgrading alphabet from neutral to buy it is difficult to show meaningful upside from the lofty growth estimate. the risk/reward is better for amazon and meta. shares down 1.5% and ubs upgrading moderna from neutral to buy citing a pullback and pipeline progress post covid. shares of moderna up 3%. back to the top story and

investors really still unnerved by the short-lived rebellion against vladimir putin it ended with moscow signing a deal with the wagner group the u.s. crude is spiking on that news. off those lows off those highs, excuse me u.s. crude spiking to $70 a barrel before falling in the early trade. we are looking at commodities this morning wheat on the move to the upside with russia still known as the world's top exporter wheat is up 2% over the last week, up double digits joining me now is helima croft rbc head of global strategy to talk about everything we are seeing in russia helima, great to have you here. >> thank you, frank. >> we are getting in your wheelhouse with the oil and wheat. what can we expect from the

commodities market with russia having an impact on the global wheat market >> russia is a super store it is oil and gas and agriculture and metals the big concern this weekend was the declaration of marshal law that would lead the closure to the ports. the white house was making calls to key producers to signal if there was a disruption that they would take steps to abate crisis in the market. markets are breathing a sigh of relief because of the worst-case scenario did not play out. >> it is not play out. we see the cnbc articlies seein a sigh of relief how do you review the headline risk with the situation beyond oil and commodities? currency and impact on the global markets >> i think a lot of us were factoring in multi-year war in ukraine with the russians continuing into the u.s.

presidential election. what we were not factors in is chaos in russia and what it means for the world's largest nuclear power. now i think that is something everyone is thinking about for the back half of the year. yes, prigozhin has gone to belarus. what does this mean for the state of security in russia? >> the leader of the armed rebellion sent to belarus. we have a depiction of vladimir putin. this is a merciful end and surprising one what does it mean about the future of the ukraine and russian conflict and his position in the world? >> ian bremmer is out this morning saying putin is dead man walking. we will have to see how this plays out. prigozhin's forces allowed the russians to take bahkmut what does it mean for internal

stability inside russia? you had a situation where they could take rostov with little opposition concerns about the support of security services. we are factoring in the internal chaos inside russia going forward. >> helima, tina fordham is with us tee tina, thank you for joining us >> good morning. >> what about the headline risk? we are seeing disruption with the world's biggest nuclear power and exporter of wheelat ad oil producer should we look at the currency markets and other markets as well >> what is interesting is that the weekend developments were the most significant political

display in russia for probably 30 years since i was in moscow in 1996 for the re-election of yeltsin. yet the markets barely blinked this is consistent with what we see historically that important geopolitical developments often don't move markets unless there is a clear transmission mechanism. helima has already made the case for why this is important, but maybe some softening in the ruble. nothing that has happened suggests a kind of reduction in russia's energy exporting capacity it is russia's internal state stability and the future of leadership and i focus on loose nukes a bit more than escalation in ukraine

we have a lot more volatility than people were expecting markets got used to the idea the war in ukraine would continue for some time and moved on now it is looking a lot more wobbly >> you mentioned wobbly. as investors look at this, of course, this show is focused on investments. does this change narrative of the u.s. sectors we see wheat prices spike a bit. that will change the input costs to companies in the u.s. in recent weeks, we have been talking about defense stocks does that change the outlook for those in your mind >> we have the nato meetings in lithuania in two weeks' time one thing we will see is a call for even more arms going to ukraine. i do think nato member states which have not hit the 2% target will be pushed to do that. there's a much bigger understanding and appreciation, i would say, at the government level that you need to fight

fire with fire and we are in a new geopolitical risk super cycle. yes, defense stocks benefit. u.s. markets tend to be impervious to geopolitical risk. i believe the doubt dampens risk appetite a fair amount certainly judging by the emails and calls over the weekend from investors, people are watching carefully and they may not be changing portfolio allocations or making decisions on the back of this which is a wait-and-see weekend. >> i'm sure you had a busy weekend. both of you. helima, full circle back to the oil market wti below $70 a barrel opec cuts in saudi arabia with the voluntary cuts can we see more upside in the market if we have to the seen it already? >> fantastic question. the fact we have not had major

russian disruption is weighing on the market. we had the run up in oil prices when the war started because of the sanctions. the fact that russian output is resilient in the face of sanctions and price caps has given investors concern about the oversupplied market. we have continued concerns of softness in china despite good import numbers for china oil there is still concern of the manufacturing sector the demand concerns and abundant supply is weighing on the market people have to watch and think if we have internal issues in russia, can russian exports hold up we don't know if the story is over. >> what do you think is this situation resolved for the most part? will we continue to see russian exports with oil are we facing real disruption? >> it is a great ununcertainty

no one pen scilled in the uprising the question is what does this mean for vladimir putin's staying power? >> tina, one key take away for investors today. there will be questions how the situation will fully resolve it itself how do you look at this going forward globally >> i see the developments as consistent with my thesis on the new geopolitical risk super cycle. i actually have been flagging internal along the periphery i think what investors need to do is view what is happening in russia more through "good fellas" than james bond. >> you have to explain that one. >> russia as a kleptocracy and a

finally tuned intelligence machine. i hope if you take away anything, it would be to put to rest the idea that putin plays three dimensional chess. he may not be on the lead after 23 years much longer few investors are exposed in that respect what we need to think about is that transmission mechanism with geopolitical risk. that is what helima talked about with commodities and grain this autumn, everything is in focus. in 2024, it is a huge election year u.s., uk, russia and ukraine and indonesia and india. you name it. a lot to play for when it comes to geopolitics more than we're used to. >> a lot going on.

i was expecting a joe pesci reference. tina and helima, thank you >> thank you >> thanks, frank. coming up on "worldwide exchange," stocks riding high thanks to the get out and travel trade. why one sector still has more room to cruise ahead a hint there stay with us much more after the break.

wielcome back to "worldwide exchange." let's get a look at the european trade with joumanna bercetche with the global briefing >> frank, a bit of a risk-off with the global markets today. let's bring the top stories we are focused on overnight s&p global has cut china forecast to 5.2% that is down from 5.5% it is the first such move for china from a global credit rating agency this year. it follows similar cuts from similar banks as china's post-pandemic recovery is u uneven wespoke about goldman sachs last week. shares in element 25 soared after the mineral company is providing manganese sulphate to

gm elsewhere, nothing to do with russia, but greece's conservative democracy party won the parliamentary election this weekend. beating its rival the leftist. the incumbent mitsotakis won four years in office after 45.5% of the vote. greece has been the success story of the eurozone after the last ten years and emerging from the bailout in a stronger position than before >> joumanna bercetche with the global briefing. thank you very much. sticking with stocks and one sector outside of tech with a huge run-up in weeks is the cruise lines shares of carnival moving higher adding to gains of 100% this year as demand for vatravel and experiences strength ens in the

summer real caribbean is hitting a 52-week high on friday let's talk about this with james hardiman >> thank you for having me. >> james, this is powered to the upside by the g.o.a.t. trade, get out and travel trade >> these stocks have had a great run. these are the last remaining reopening plays, so to speak, coming out of covid. i think there are interesting company specific stories here. we will hear more from carnival this morning we raised our price target three times in the last month. we think carnival specifically, as you have the chart up, we think there is another 15% to 30% upside. >> carnival shares up .50% ahead of earnings right now. you said cruise line pricing has

increased by 9% year over year in may -- not year over 2019 pricing. v carnival pricing did not see that big of a bump i want to ask how much of that is inflation and how much is pricing power gains for the companies? >> i think what is critical to understand is the cruise lines, essentially sat out the multiyear period of inflation. on the relative basis, we have seen much less pricing from the cruise lines than just about any other consumer sector. most notably, traditional logic. land-base vacations. prior to the pandemic, you are looking at pricing discount of 20% to 30% cruise lines over land-based very inacations that is more 40% to 50%. that is a big opportunity as

consumers pinch pennies and get most bang for their buck. >> another note searches for cruises were up 132% in may over 2019 levels. all of this interest how much does this convert to real-life bookings >> i think there has been a strong correlation with those two data points. we are just finally beginning to see the marketing engine reengage relative to the pandemic so, as these companies, which have really added to their offerings are getting those offerings in front of consumers, consumers are taking notice. they doing the cruise searches online and booking cruises wave season is what the industry calls january through march where a number of bookings are made was extremely strong this

area that tends to bode well for the season. >> james hardiman from citi. shares up more than 50%. thank you for your time. >> annou ahead here on "worldwide exchange," every word you need to know today. and ryan reynolds growing his business by one. and follow our podcast if you miss us, check us out on apple or spotify june is pride month. we share our corporate leaders with you >> for me, pride month is truly a celebration of the uniqueness of our community it is also an opportunity for the lgbtq+ community to come together in solidarity because there is strength in numbers particularly this year when there is a lot of hate and intolerance against certain

parts of the community solidarity is crucial. for us comfortable visible and speaking out, we need to come together and do that to fight this hate and intoleintolerance. ready to shine from the inside out? say “yes” to nature's bounty advanced gummies and jelly beans. the number one brand for hair, skin and nails. with two times more biotin to bring out more of your inner beauty. get more with nature's bounty.

welcome back to "worldwide exchange." time for the wex wrap up bad weather cancelling more than 1,000 flights and delaying thousands this weekend marking one of the most challenging travel days in months british carmaker aston

martin trstriking a deal with lucid. aston buys currently from mercedes-benz. stitchfix appointing a new ceo from macy's. lake will kcontinue pin the rol as chairman. and rihanna steps down as ceo of the brand savage x fenty. ford recalls more than 250,000 suvs after the repairs intending to prevent the vehicles from rolling away. and $20 million cash injection from a group of investors from ryan reynolds for

alpine 1. and the start of earnings season is happening in a few weeks. let's bring in greg branch of veritas financial. greg, great to see you. >> good morning, frank. >> a lot of uncertainty of the fed and what russia is going to do in the future how do you keep your trading day straight >> the few weeks will be volatile as investors search for the events playing out they don't lack certainty. frank, the fed has clearly spelled out their position they did choose to pause they came out with a hawkish body language. the end of the day, the data we have, presents to us a feeling

they need to continue to raise i'm continuing to expect the terminal rate above 6% the market is not reflecting that the earnings season will be important because i believe consensus is way too high in the back half. the next few weeks will search for direction. >> the market is not reflecting what you believe is reality. what is your word of the day >> conundrum the fed and investors with a conundrum. what we see is a market that is too hot to necessarily give the fed comfort that inflation is or will continue to come down it is not strong enough to justify the estimates we're seeing for the fourth quarter through 2024 the inverse of the opposite of

goldilocks >> let's talk about where you see as investable areas in the market today i know you are bullish on h healthcare two of the most overbought and oversold markets are in the healthcare market. differing opinions with health care where do you see the upside for heal healthcare >> i think it presents a safe haven. i'm not bullish at all on equities which will pull back 20%. on the insurer size, they gave investors pause to flee on the concern of mlr

there was pent-up demand i think with the likes of humana and others, this is a strong balance sheet and strong cash flows. like big tech, it will deliver strong earnings growth in the challenging macro environment where everything else is contracting. some of the same for big pharma. you look at two of the biggest tailwinds with diabetes and weight loss. stocks trading at 50 times for lily and 20 times for novo i don't know if it matters. >> greg, you are looking for safety and eyeing cybersecurity. same theory. a safe play. is it an etf play or single stock play >> same theory here. e etf at this point. they have strong secular

tailwinds. that is what the market will reward in addition to strong earnings growth. you look at all of the activities moving to the cloud and there is runway there and new runway provided by a.i. for those companies. >> greg, thank you very much great to see you before we let you go, one quick look at the futures. futures off their lows of early this morning the dow looks like it is close to flat. nasdaq is down fractionally. orwi will do it for us here on "wldde exchange. "squawk box" is coming up next thanks for watching. you should get a second opinion from innovation refunds at no upfront cost. sometimes you need a second opinion. [coughs] good to go. yeah, i think i'll get a second opinion. all these walls gotta go! ah ah ah! i'd love a second opinion. no. i'm going to get a second opinion. with innovation refunds, there's no upfront cost to find out. so why not check like i did for my small business? take the first step to see if your small business qualifies for the erc.

good morning putin's grip on power questioned after a mutiny over the weekend by a mercenary group details ahead. flights disrupted after bad

weather on the east coast and flight control repair in the d.c. area. and bitcoin up 83% year to date we will show you what is moving now on monday, june 26th, 2023 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc live from the nasdaq market site in times square. the futures and stock market is interesting. we need someone that if we can get someone at behrens >> 15. >> mike, good to you have here i'm joe kernen with mike santoli. becky is off andrew is around he will join