tv Closing Bell CNBC May 7, 2012 3:00pm-4:00pm EDT
with pizzas that aren't gluten free, so that makes it kinda sorta half gluten free. domino's is on fire. stock is up 50%. >> no doubt, because the ceo won the -- >> yeah, that gluten free thing is like being just a little bit pregnant. you can't do it in halves. okay, everybody, we will hand you over to the "closing bell." thanks for watching. >> and we will take it from here, guys, thank you very much. welcome to the "closing bell." for a monday. >> maria is back tomorrow live from washington with her exclusive interview with house speaker john boehner. so tune into that. for the meantime, the markets right now, u.s. stock market stopping the global sell off in its trackes. shrugging off all that uncertainty, and in france and greece, perhaps signaling that austerity over there might be in
trouble. we did lose our share on friday ahead of elections so maybe some of it is priced in. here is a look at major averages. dow jones trying to get into positive territory and it has done so by a third after point. but we will take it considering what it looks like this morning. nasdaq is in positive territory by a little more than nine. just below 3 thousand w 2,966, not quite right below, but -- the s&p 500 right now is also in positive territory. 1372. >> individual stocks we are watching today, yahoo! shares rallying in the session. as you know, activist shareholder issued a noon deadline for today, for yahoo! to fine its ceo, following alleged discrepancies over scott thompson's resume. that deadline has come and gone today. they are ignoring it. now they are demanning yahoo!
turn over books and records involving thompson. how do you think that will work out? later in the program, we will tell you what a long prolonged battle could mean for yahoo! shareholders. >> we mentioned at the top, this is a rezsilient market. >> so far. >> is this a sign that equities can shake off future concerns and post more gains ahead? well, billionaire investor warren buffet offered his take on the u.s. stock market earlier today on cnbc. hope you saw it. listen. >> i think equities are very attractive for the long-term. they may get more attractive next week or next month. but same thing i said in october 2008. i didn't know where bottoms would be in the year but equities producing businesses, good producing businesses are a great thing to own over time and they have been a great thing to own for several hundred years in this country. they will be a great thing to own for the next hundred years.
>> is warren buffet correct? let's get analysis on this. bob is with us here at the new york stock exchange. becky quick is still in the heard land. and also with us, cnbc portfolio manag manager, peter. we were all wringing our hands yesterday afternoon. >> hold on, warren buffet says equities an attractive long-term invef vest /* investment. goodness. >> are you saying he says that all the time. >> yes. >> this is relative to bond. i hear this from traders all the time. bob, i hate this market but what else am i going to do? where else am i going to go? 1.9% on ten-year. there is no room for them to move. i think the bigger question is, assuming we get another euro crises this summer, and i think we will get one, are stocks going to react the same way? valuations are about the same
last year. i think that's the big debate in the next couple weeks. >> peter, i bet you are not convinced, at least in the short term, what warren buff set saying. why are we seeing yields so low and yet stocks moving higher? >> his time, as you said, is a hundred years. i'm going to go out on a limb and say -- >> he will still be around -- >> i will say a hundred years from now the market will be higher. but everyone has a different definition of long-term. if you bought stock in 1999, you're flat. not including dividends. so the time is a big part of what he is saying. those that have shorter time verizons, it is a different ball game. with the question of valuation, 14, 15 times peak profit margins is just not atrackive to me. so the market is not cheap. individual names here and there are certainly cheap if you can find them but in the aggregate, i think the market is not that cheap. >> okay. >> there is forward times earnings. >> these are --
>> well, i don't want it pay 15 times. peak profit margins. >> you say they decelerate from here. we will see higher profits but not at the same pace -- >> if you look at a season -- if you look in the short term, which when you pay for a company, outside of the management and what they do, is the most important variable. if you buy it right, you will make money. if you buy is wrong like in summer of 1999, it'll take you a long time to get that money back. >> becky, presumably, this is the kind of sell off this morning that he would have been buying that kind of a dip. what did you think he would be buying right now. >> we have been trying to figure that out all morning. he said he spent $60 million on the market on friday. he had been planning on buying stocks td todd. he says you get more for your money when stocks go down. we have been trying to tick around and find out what it was. we did ask him, tried to narrow it down, two issues are things he has been a long term holder
in. we know that he has liked wells fargo for a long time. that he liked ibm for a long time and he said more positive things about two companies today so those are two potential guesses. trying to ask him a little bit about proctor and gamble, another company he add long-term stake in. they lowered their fiscal year outlook and talked about problems trying to get prices to stick in some areas. when we asked about proctor and gamble, he said, let's just say i've been a long term holder and we are a little bit weasley. he did say if you look at older sec filings they are selling 06 stakes. so i'm getting it is not proctor and gamble. he said he doesn't like cash. it is over the long haul, definitely you will lose money in it. inflation steps in. but of course, berkshire keeps about $34 billion in cash on hand. they do like their safety buffer, but he did say they
didn't like that either. if i today guess, i guess something like wells fargo and or ibm. >> we will talk about those in talking numbers as well. i wonder if there was a buffet effect in today's market in making those comments that he would be buying stocks right now. >> i have it say, the greek situation was surprise. i thought it was much more dire than people anticipated. you can say, we all know about mr. elan. they kept saying, there is not a lot of other places where testimony can put money. >> that's argument to me, is a little bit not convincing, but the one i'm getting. >> here is what i don't understand. at least 30 and 40% of the s&p 500 probably yields more than a ten-year and yet millions of people and millions of dollars and billions of dollars everyday get put into treasuries that yield less. why wouldn't you buy a stock with a higher yield and then get the appreciation? >> s&p is over 2%. >> yeah, so i don't understand. >> by will have to be the bad
guy and say, pencils down, time's up. becky, peter, thank you both for joining us. meantime, let's break down some of the day's movers and shakers, including pepsi, which got a big upgrade. seema has details on that. seema? >> hey, bill, we will get to pepsi in a moment. but after-election results came in from france. some traders hit the panic button but right now, the dow is down about nine paint. s&p down 2.6 and nasdaq up by about a quarter percent. one of today's winners, as you point out, pepsi. morgan stanley raising u.s. beverage industry outlook to attractive raising its rating on pepsi to overweight saying they view pepsi as win/win situation. stock up about 1% at this point. news on aig, treasury announced plans for 106 million shares. about $5 billion.
a move that cuts its take to 53%. another loser is cognizant technology. look at stock. down 19.6%. the information technology services company has lowered its full-year earnings forecast. the company says it's seeing a a slower than anticipated acceleration and deplanned for its services. echoing what some of its rivals have seen as well again, stock down by 19.5%. guys? back over to you. >> thank you so much, seema. all right, we have about 15 minutes left in the closing bell. dow jones industrial average down by 13 point and nasdaq lower by 6. >> shrugging off the election results in europe so far. so is the risk on trade back on or will europe still end up dragging u.s. markets lower? >> tyson foods latest earnings, consumers, are they going to keep paying an arm and leg for higher costs? chickens don't have arms, they have legs. >> they with do, they are calls
wings. >> but you don't call them arms. >> my turn, after the bell, forget europe and weak labor market. our sky rocketing student debt loans. the biggest threat to our economic future. we have that debate coming up. we want you in on that conversation. i know you could write a book, but you're limited on your character count on twitter. e-mail us. some of your responses will be unveiled later. stay tuned. this is the first car that i've been totally in love with
in every way, shape, and form. it's my dream vehicle. on a day to day basis, i am not using gas. my round trip is approximately 40 miles to work. head on home, stop at the grocery store, whatever else that i need to do -- still don't have to use gas. i'm never at the gas station unless i want some coffee. it's the best thing ever. as a matter of fact, i'm taking my savings so that i can go to hawaii. ♪
the election results. stocks and bounds off the session lows despite the european elections creating uncertainty over the course of the economic recovery. the austerity plans. the debt bailouts, all those things going on over there. financials, telecom and healthcare among the leading sectors. here is a look at financials posting the best gains at this hour, including fifth third, hudson dit sity bankcorps and strategist saying more measures could help the banking economy and now just down nine point trading in a relatively narrow 79-point range. so a slow start, but equities are managing to crawl back into positive territory with europe's sovereign debt situation still hanging in the balance. we're wondering why the bears aren't making a bigger mark in
today's session. september michelle. you sort of expected this today? >> i didn't go to greece or france because i didn't think there would be market movers. >> and you were right. >> with us today is jonathan and jason. guys, good to he sue. >> good to see you. >> so people are looking at europe and saying, oh, they are rejecting austerity. i think that's quite quaint. they don't have a choice. to me, the market reaction says, you think it can reject austerity. but when there is no money it comes from within or without. is my premise right or wrong? agree to me so we did k go -- >> i think the market reaction today has been rather muted. number one, widely anticipated that he would win and he is not inasmuch control as he thinks -- he spends money willie nilly. >> reminds me of president clinton in 1949 where he used very colorful language, saying my entire administration is
relying on -- >> bond traders. >> bond traders. there was another word in there. >> is there concern that perhaps in greece, where all kinds ever threats have come from leaving candidates there, leading the euro, abandoning the debt agreement that was reached last month? you know, all those things, all the hard work going into bailing greece out could go by the way side. >> right. i think what hasn't been represented, whether or not you agree, if you tell the greek people, okay, you don't want it deal with the bailout but the euro, when they are given that choice, the answer is very different. >> first of all, i think the story today, is there's no news anywhere here. you know, we expected that elan would win. that the case. we are seeing austerity. >> thok shoking. >> and the thing is maybe opposite of what you are saying is why would people voluntarily go through something that is so difficult when there's this
magical solution on the other line with the hands of candidate. you will see, i think as a theme, with populism will make it very difficult to push forward austerity and i'm not sure the market right now won say, maybe the solution is a better one. i'm not saying it is rational or better for the markets. but i'm not surprised that voters are going that way. >> i guess i'm very skeptical because i think that obviously, raising taxes on one group of people to distribute money to the other group of people shouldn't result in any net new growth. the world doesn't work that way. but i tend to agree with johnson, where it seems elegant but we have 60 years of history to tell us it doesn't work. >> we expected to sell off today, some of us did, in the expectation now we go back it square one or something else will have to happen to get the bailout going. with the come back today and the fact you weren't really expecting a sell off today, are you suggesting, though, that
everything is in place for the fix in europe? >> oh, no. >> you won't see any more volatility or rejection of austerity plans? any more uncertainty when it comes to try and come up with plan that is workable for the european governments? >> i think the ecb has demonstrated, tell me if you agree or disagree but they won't let the whole thing fall into the abyss. so unfortunately, what we are looking at is a japan situation for more than a decade in europe as they slowly get their act together. >> why aren't we seeing more after sell off in the narkets today? >> there is nothing new here. i think you hit upon it, michelle. if the ecb is not committed to having this roll off a cliff, then this is a story that will keep peaking up over time. you will see the ten-year, yields on it fall. but ultimately, it is not a new story. nothing new here. and i think you're right. that what story was this morning, there is nothing new here. and all of the bad news on the
jobs report was in the market on the u.s. >> so warren buffet, when he says now is a good time to buy -- >> he was going to buy today. >> with all due respect to mr. buffet, the master, i'm not so sure. and for those with long or short term -- >> not only is he buying green bananas, he is planting new banana trees. >> and you don't agree? >> listen, i think that ultimately this looks appealing. but ultimately if this were a reliable economic strategy where you spent money you didn't have and you had central bank printed, none of us had to be here. we could all go home, go to sleep. eventually it result in something, that something will be inflation eventually. this is not a reliable -- >> you are telling people to commit money here? >> i have a 1475 target. the thing is, and i'm just as comfortable with it today as i was a week ago. >> good to see you both.
always enjoy having you. jonathan, see you later in the countdown, on the closing bell as we head there. >> berkshire hajj ways largest holding. woke koch and ibm? are they worth adding to the portfolio like warren baueren buffet's portfolio? >> and fired over alleged inaccura inaccuracies. the ceo controversy still to come on closing bell. >> the heat map is shaping up about 50/50 as we see the indecisiveness on the averages so far today. we'll be right back.
today is gonna be an important day for us. you ready? we wanna be our brother's keeper. what's number two we wanna do? bring it up to 90 decatherms. how bout ya, joe? let's go ahead and bring it online. attention on site, attention on site. now starting unit nine. some of the world's cleanest gas turbines are now powering some of america's biggest cities. siemens. answers. (sfx: car garage sounds) today my journey brings me to charlotte, north carolina, where i spent the day with geico driver casey mears. i told him the secret to saving money on car insurance. he told me the secret to his car setup. first he adjusts... first he adjusts... (sfx:engine revving drowns out gecko's dialogue) then he... then he... (sfx:loud drilling noise continues to drown out gecko's dialogue)
sharon has the details. sharon? >> michelle as you were pointing out earlier, a severe overreaction to the elections in europe. a $95 handle in overnight session at the open of that electronic trading session on sunday night, only to gain it all back, pretty much, during today's open outcry session, finishing under the $98 mark. we are actually trading right above that level right now in electronic trading once again. still, morgan stanley point out, there are bearish fundamentals on the price of crude oil.
there is more data from the energy department tomorrow and monthly oil market report will get data from the international dental agency and from opec later this week. it appears the production levels are above normal and we may see that above the mark through the third quarter. so that could continue to pressure crude oil prices. back to you. >> sharon, thank you very much. we are heading into the feenl hour of trading of course. talking numbers, a nice bid on shares of coca-cola today after nice comments from one of its largest shareholders. that would be mr. warren buffett. see what he said today. >> coca-cola will be more profitable, in ten years, in my view, than it is now. >> pretty simple. if you think it is more profitable in ten years, by the stock. should you buy it here? what about other long-term holdings, that's ibm? talking numbers with us is carter worth, chief market technician at oppenheimer. welcome back, sir. >> coca-cola. >> is it as good as warren buff
wo waur /* warren buffett would suggest? >> well in the well defined channel and one of the rules of thumb is when you get to the bottom or top of channel, play for the other way. there is upside and then going to about 82 before it will be tired. >> but you looringing pretty short term here though. >> yeah. we are talking two to three months. >> here is a much-longer turned chart. >> yes. and also what you see on ibm, where the stock is now compared to its all-time high back at the basing top in -- >> in late 90s. >> exactly np is 88, $90 and coke is nowhere near that at 77. the implication at some point it'll approach the past tops. >> so you like coke here? >> i do pz what about ibm? >> equally low beta. but not quite as interesting. here is the uptrend. now let's look at the channel. the same thing. where as coke still had room to
run, this has already touched the top of the channel. the presums it needs to rest, pause, pull back. remember coke hadn't gotten back to the 09s. this is 50% above highs at 202 versus 140. >> you are a cautious on ibm. >> yes. i think this has come a long way. i would rather do coke. good pictures. see them together on this long timeframe and coke literally for 15 years has done nothing. it has performed the s&p. ibm, quite the opposite. i think you favor coke here at this point. >> as warren buffett it as well. carter, good to see you. on talking numbers, michelle? >> the dow is lower by nearly nine point and nasdaq is positive by more than 8. we have 35 minute before the closing bell. up next, outspoken banking analyst explains why he thinks
investors should pit against j.p. morgan. here is how each member of the dow is trading. about 50/50 between red and green. tdd# 1-800-345-2550 we're hitting new highs. tdd# 1-800-345-2550 and i'm on top of it all with charles schwab. tdd# 1-800-345-2550 tdd# 1-800-345-2550 i use streetsmart edge and its tools like... tdd# 1-800-345-2550 screener plus - i can custom build my own screens tdd# 1-800-345-2550 or use predefined ones. tdd# 1-800-345-2550 and i can trade wherever i want, tdd# 1-800-345-2550 whenever i want. tdd# 1-800-345-2550 the kicker? tdd# 1-800-345-2550 i pay $8.95 a trade. tdd# 1-800-345-2550 that's a deal in any language. tdd# 1-800-345-2550 open an account tdd# 1-800-345-2550 and trade up to 6 months tdd# 1-800-345-2550 commission-free. tdd# 1-800-345-2550 call 1-866-393-6174.
welcome back. 30 minutes to go to the trading session. stocks are showing no sign of late day slump so far, despite the uncertainty about the european elections. bob is back with more on this. robert? >> the important thing is, what, me worry? doesn't look like anyone is worried. u.s. ten-year yields to the down side. the dollar is up here. there doesn't seem to be a lot of worries in the world right now. we are about where we were trading a year from now. a year ago. about 1360 or so on the the s&p 500. i think a lot of people are starting to wonder what kind of summer swoon there might be. a lot of notes passed around. guys, back to you. >> sam, david rose enburg,
abbey, just some of the big names discussing latest trends and opportunities at the cfa institute annual conference in chicago. mary thompson joins us with highlights. mary? >> hey there, michelle. certainly an all-star guest lit here at the annual conference. earlier today i hosted an hour-long discussion with ariel investments. mellody hobson has mutual funds as well. she says safety of their assets and in speaking about the mutual fund industry, there is a better need to better communicate with investors as to why the active managers are the best thing for investors right now. something some people would request given some disappointing performance. also in a positive sign, she said all 24 low trading volume, it is a bullish sign. she said she thinks the retail investor will come back.
the interesting thing that happened earlier this morning with with the the institutes president, said there was a call to action. people don't trust financial firms any more and the burden to restore that trust is falling on the cfa community. the cfa institute published this 50-point integrity list which includes things, which might be difficult to do, like at the firm you work for, if it doesn't agree with your ethical guidelines as cfa, kiss that firm good-bye. harder to do, i should say, than to embrace as part of the integrity list. of course our next guest knows about that. i will let you introduce them. back to you. >> stay right there. mike just downgrading j.p. morgan clas. deit on friday, to underperform. and a rise to shareholder power at financial companies in this country. how does all this affect the way you invest in the financial sector right now? >> let's ask him.
an exclusive interview with mike mayo. good to see you. >> how you doing. >> you can't real the whole report but give us some quick reasons you why downgraded j.p. morgan, which nearly every analyst that comes on says it is best in class. if there is one safe place, it is j.p. morgan. you are doubling, two notches, from outperform to underperform. why? >> count me as one of those analysts. i was one of those last year that said buy j.p. morgan. but i'm negative on the banking industry. i think the first quarter is as good as it gets. economic growth is decelerating. i just think they are more expensive than some other banks out there. >> sounds like that is true of the entire banking sector, not just j.p. morgan. >> to some degree it is true about the entire banking sector but it is also especially true about j.p. morgan. market activity not as strong as the first quarter. you have the mortgage business that's not likely to hold on for too many more quarters the way
it was in the first quarter and you had this halo effect over j.p. morgan. they deserved a lot of it, just not as much as they go. >> most think jamie diamond is the smartest guy in the room. if he anyone can make it work, he can and he has to this point. they have a portfolio of businesses. even warren buffett is acknowledging that banks are different than four years ago. isn't there a way that he can find a way to continue to grow this company, even as the economy sputters at this point? >> well, we are saying that banking industry is a lighter version of what is taking place in japan and you cannot escape the pressure on margins, loans and overall revenue growth. j.p. morgan might be good. but he cannot escape the environment where he is operating. >> i want it ask you, you are not negative on all banks. you you spoke with goldman sachs
ceo and cfo. this is one of the banks have you a buy rating on. what is the difference given they are all operating in a difficult environment. >> of the five big global u.s. banks, i have effective acceleratings on the four of five. the one exception is goldman sachs. i don't think they are losing market share. i don't think their franchise is inasmuch a decline as people think it is. and i don't think management is getting enough benefit. in a way, it is like derek jeter during his best years getting booed in yankee stadium. they are getting hits, just not getting credit. they have made mistakes when it comes to regulatory pr. they have made a load of mistakes. but you have even seen derek jeter make a little bit after come back. i think goldman sachs trading below book value and j.p. morgan above book value, offers better value. >> go into that a little bit more. you say one of the reasons to buy goldman sachs is because they can buy back the most stock
right now. >> is no other bank trading below tangible book value that can buy back as much stock as gold man stacks. what they have gotten right is they know how to allocate their own capital about as well as anybody. >> just one last question. i want to, quickly, if you can answer, your thoughts on what john rogers said today. i know this is subject of your book "exile on wall street" that the cfas need it take a harder stand. what is your thoughts on him saying we have lost the trust, he need to improve the trust. >> that is not occupy wall street or mike mayo. the head of the most significant professional body said call it action bit finance professionals to restore trust in the industry, great leadership by the cfa. >> thank you, mike mayo. we have been speaking with mike mayo, a banking analyst at csa. >> good stuff there. thank you very much. we are heading toward the close. about 25 minutes to go. dow still down nine point. see if we can finish positive
today. >> rising price force chicken, pork and beef. make your summer barbecue much more expensive this year. when we grill up the nation of the stock set to crash in on rising food inflation. that's straight ahead. >> we were talking chicken arms today, somehow. who could argue with billionaire's warren buffett and bill gates che it comes to investing? gold lovers, that's who. wait until they today say about the stuff that glitters and who is already responding to what they had to say. >> don't forget, we want your opinion on how big after threat sky rocketing student debt is to our nation's economic future. tweet us at cnbc closing bell and some of your responses will be unveiled later in the show. >> which nasdaq stock is packed on the biggest percent ang gain in year? apple? price line.com? or sears holdings? the dividend pays 06 after the break. [ male announcer ] this... is the at&t network.
a living, breathing intelligence teaching data how to do more for business. [ beeping ] in here, data knows what to do. because the network finds it and tailors it across all the right points, automating all the right actions, to bring all the right results. [ whirring and beeping ] it's the at&t network -- doing more with data to help business do more for customers. ♪
it's just too hard." then there was a moment. when i decided to find a way to keep going. go for olympic gold and go to college too. [ male announcer ] every day we help students earn their bachelor's or master's degree for tomorrow's careers. this is your moment. let nothing stand in your way. devry university, proud to support the education of our u.s. olympic team.
>> just before the break we asked, which nasdaq stock packed on the biggest percentage gain this year? apple? price line.com? or sears holdings? now the payoff. sears. which has gained more than 70% year to date. >> wow. the nasdaq led the market lower last week, the index is a relative bright spot today, actually. courtney reagan has the details. courtney? holding in positive territory at this point in the trading day. earlier we saw a flip-flop back and forth between positive and negative. take a l at shares of vertex. more than doubling today after data coming out of that ongoing phase two study for the company's treatment to treat cystic fibrosis in adult. showing better than effected lung funk suffering from a common gene mutation. very bullish on the possibility of this drug going forward as you can see. but shares of cognizant
technology going ought other way and the company lowered full year expectations despite reporting inline earnings. bill? >> didn't i see you on the "today" show over the week end? >> yes, did you. >> good job. >> thank you very much. yeah, a great time there. about 18 minute left here and time for market strategy check at this hour. let's start with the volatility index. retreating from the highest close since mid april. right now, down a fraction or a little over 1% at 1894 as traders and investors digest election results over europe out of the weekend. now to the nasdaq composite. not too far from session highs though it is back below 3,000 for a second day in a row. right now, it is down -- well, up six point but at 29.62. snapping a two-session losing streak. what a relief there. >> also on the move today, tyson foods. stock is up 3% after s&p boosted rating on the company to buy from hold. tyson delivering strong earnings
on its ability to raise pricees. tyson is paying more for feed but still able to pass the cost on to consumers. take a look that move today. >> how long can tle do that? heather jones joins us with an inside look at some winners in that pricing game. it is all about pricing power right now, isn't it, heather? >> yes, it is. yes, it is. those that are in the chicken industry right now are benefitting from much stronger demand. they are benefitting from a demand shift due to price increases we have seen in beef and pork. as well as tight supplies out there. >> how long can that last, do you think? at what point does the consumer reject the product? >> the price increases of chicken have been much more modest than in beef and pork. so i think the shift into chicken should last for over the intermediate term, if on the supply side, we believe the supply tightness should last for, i would say, at least the next two to three quarters. >> you like some of the real brand names in this category.
tyson and pilgrim. >> yes. we like tyson because they are outperforming the industry and benefiting from the fundamentals. and pilgrim's has a cost saving program in place. also the second largest player in chick and and is a pure play and has strong play in mexico -- >> how much do you play into your pricing, into your thoughts on the stock about the ability to expand in china as they start to modernize their agricultural sector over there. >> well right now, we are looking more as their international operations as they improve they are becoming less of a drag on earnings. but we believe over the next couple of years that their international operations in china and brazil should be a nice uptick in their earnings power. >> so that's chicken. what about beef? especially here in the u.s. do you see any pricing power there at all? >> beef supplies have been tight here. the u.s. industry has also benefitted from strong demand
overseaes. that demand picked up pretty significantly over the last six weeks. so that is helping beef pricing. and the wake of the whole lftb esh u, you saw a pull back on domestic demand so that is now turning. beef markets turned a corner pretty significantly over the last couple of weeks which is bullish for tyson as well. >> heather jones, thank you for joining us today. >> thank you for having me. >> we have about 15 minutes before the closing bell. right now the dow jones is lower by seven points. nasdaq is higher by seven points. >> electronic arts about to report earnings. we will have a preview and a look at whether it is time to play in the beaten down weather industry. we have names for you to think about coming up. >> here is how the treasury mark set trading. high are across the board with the exception of two-year which is flat. ten-year, 1.87. what we achieved here.
standing at post 6 m that is where georgia gulf trades. ggc, getting hit very hard. ggc is one of the biggest losers, slumming after westlake chemical withdrew the $1.2 billion takeover late friday. westlake said it had no plans to pursue a future deal. both companies make chemicals. georgia gulf says it remains confident in its existing business plan. ceo touting the first quarter operating results as best q1 it reported in six years. and despite today's drop, georgia gulf shares are running ahead of westlake chemical on 52-week basis. georgia gulf trying to hold on to positive territory the past year. >> all right, getting set to kick off a big week of earnings from the video game industry. julia is spending the week with us at headquarters. she has a preview of how stocks faired this year. >> video games are in the midst of a massive transformation away
from packaged games to virtually free games on-line. all eyes are on electronic arts. it is a traditional game maker. the in the 36% decline in earnings per share. today the stock is trading lower. we will have to see here -- actually, it was trading lower. now it is up just a fraction of a percent. we will have to see strong sales of mass effect three and on-line game star wars. onlien republic help boost results. the gone line gaming is help shift time and money jn line. electronic arts is down year to date. down 26% year to date. blizzard is about a flat year to date and take two interactive is also about flat year to date. the largest player in this market does report after the bell on wednesday. i'll be back shortly with
electronic arts numbers right after the closing bell. bill, i will talk to you soon. >> all right. we look forward. next hour a real gee whiz conversation on technology. outside of video games, another area under pressure. balance sheet of student coming out of college. if you do the math, student debt is $1 trillion which eclipses credit card debt for the first time in a long time. so student debt now the biggest threat to our nation's economic future? here are some of the responses you send us via twitter. matt says it needs to be treated like other unsecured debt and not given special treatment with regard it bankruptcy. another response from gunner. he told us, no, an apathetic america encouraged by our president is the biggest economic threat. then ivan treated, housing bubble. health care cost, college tuition. do you see a pattern?
uncle sam is the biggest financial player in these markets. >> oh, i like that one. >> i thought you might. >> we appreciate your comments. continue tweeting your thoughts to @cnbcbell. >> when we come back -- >> when you subsidize something that everybody want. you know what happens? it gets more expensive. >> as the title of her book suggests, you know she's right. we have closing countdown towards monday as we head toward the bell here. >> there the latest on growing ceo controversy clash straight ahead. >> as we head to the break, here is how the averages are trading minutes before the close. back after this. but when i was diagnosed with prostate cancer... i needed a coach. our doctor was great, but with so many tough decisions i felt lost. unitedhealthcare offered us a specially trained rn who helped us weigh and understand all our options. for me cancer was as scary as a fastball is
to some of these kids. but my coach had hit that pitch before. turning data into useful answers. we're 78,000 people looking out for 70 million americans. that's health in numbers. unitedhealthcare. recently, students from 31 countries took part in a science test. the top academic performers surprised some people. so did the country that came in 17th place. let's raise the bar and elevate our academic standards. let's do what's best for our students-by investing in our teachers. let's solve this.
in your fight against bugs. ortho home defense max. with a new continuous spray wand. and a fast acting formula. so you can kill bugs inside, and keep bugs out. guaranteed. ortho home defense max. hey, it's sandra -- from accounting. peter. i can see that you're busy... but you were gonna help us crunch the numbers for accounts receivable today. i mean i know that this is important. well, both are important. let's be clear. they are but this is important too. [ man ] the receivables. [ male announcer ] michelin knows it's better for xerox to help manage their finance processing. so they can focus on keeping the world moving. with xerox, you're ready for real business. on december 21st polar shifts will reverse the earth's gravitational pull and hurtle us all into space. which would render retirement planning unnecessary. but say the sun rises on december 22nd, and you still need to retire.
td ameritrade's investment consultants can help you build a plan that fits your life. we'll even throw in up to $600 when you open a new account or roll over an old 401(k). so who's in control now, mayans? okay, we're inside the five minute mark. as we head toward the closing bell, the nasdaq reaching its lowest point since march 7. s&p 500 touched its lowest level since april 10th. but then everybody turned around. in fact those two averages turned positive. same thing for the dow.
you might have imagined we would get the sell off and then it would go lower. everyone expected that after the results of the elections over the weekend pt the euro was the proxy for that this morn pg. we did see it go lower than 1.30 but then things turned around. there it is below 1.30 and then turned around. we are at 1.56 right now. our equity markets huf in tandem with the euro. sold off, then came back. look the a the dow. same thing. if you laid the dow on that euro chart it would have been a similar pattern. there is an 80 point decline on the dow. thought it would go lower. didn't. now down about 27 point even with a positive bias on the close here for the major averages. now, something to keep an eye on longer term for the dow jones industrial average. it is flirting with that 50-day moving average. short term trend indicator, i admit but with this minor sell off now. we are watching carefully to see if it could finish above that
level. it'll be a squeaker here on close as we are moving lower on the dow. as for oil, it did move lower. in the $97 raen j for a time. right around here. then came back just as equity markets did. we're at $98.03 on that. ten-year yield didn't really come back. went down to 1.87. here we are, at about 1.86 or there, but now we're at 1.87 in terms of the ten-year yield. we did see buying with that risk off trade on the open this morning. >> as for sectors, financials are the strongest. this presumably would have been a sector, hardest hit as a result of european elections over the weekend. but they are the strongest today. >> everyone is telling you the same thing which conditions aren't deteriorating. in the sector, that should be the most concerned about europe is financials when they are rallying it is a sign of descent health. >> you asked me earlier about
oil in the energy sector. you are watching that as we all are. is that in some ways still a proxy for the u.s. stock market? they have been moving in tandem lately. >> we are looking for a wheel variety of signs and see why they move the same direction. so the vix came done. will ten-year yield moving up a little bit saying flight to safety is easing. financials up, oil's up. all this is telling me, it is a relatively flat day but any signs that this was melting down, absolutely not in the financials are key to that message. >> this is a market, that don't you sense, want to go higher. >> it does want it go higher. i think that what the key issue, out of the news out of europe today, first of all, already in the market. that the most important thing. second is a policy makers, fed, ecb, committed to making sure things stay orderly. >> what sector would you avoid right now? utility are getting killed so far after being a darling last year for example. >> i think there's two stories. one is the high dividend paying
stocks in telcos and utilities. and i would avoid those. the other thing is, i'm not overly keshed about the macro. energy and materials, when things go bad in europe, they take a hit. i would rather be in tech and consumer discretionary, less sensitive to macro risk. >> what if you are looking for income. there are plenty of people desperate for income right now. you know, we are going to tuck about high yielding bond next hour where some of them are up to 7% right now. but many people have looked to knows high yielding ak wits too. >> i think the first thing is i would try to get investors to focus on total return, not just yield. so simply focused on yield, you may overpay and take more risk than you would expect. >> jonathan, always good to see you. thank you for stopping by today. that the first hourof