tv Fast Money Halftime Report CNBC October 1, 2015 12:00pm-1:01pm EDT
things started to fall apart once ism was soft and worse since may of 2013. then oil lost a lot of its gains. currently up about 13 cents. that's it for "squawk alley." for us let's get back to headquarters. scott whop ner, and "the half." >> thanks. welcome to the halftime show. let's meet our starting line-up for today. a game plan today that looks like this. jack's job, twitter said to be set to name co-founder jack dorsey as permanent ceo. that according to recode. we'll ask our panel of experts if it is the right move and what it means for the stock. buy biotech. one firm says now is the time to go in and buy those names. see if our group agrees. it is our call of the day.
joe, we're at the low to the day. right now dow is down 180. entering a quarter which history says is supposed to be good for the markets. is that playing out? >> we have earnings, and we have to have the return of buy-backs, which are very important to getting any type of rebound again. i think the problem right now for most investors that that market is not snapping back. there are three things that you have to continue to look at. you have to look at the price of oil. that looks like today it was going to stay above $47. sflu are going to have to see earnings, they're coming in better than the estimates we've had in the past couple of weeks. >> people are expecting that the
fourth quarter. >> it often ends when the market leader and in this case health care has a disorderly selloff, which it has had. >> the market is setting up pretty interesting. i think if you look at the ism number today, that was something that i think did shock people a little bit. i mean, we are getting ourselves into position now from earnings season as joe mentioned. we had energy up early. we talked about this the other day. some of the names that he is involved with. apple moved then, and it moved again today. this sort of breakdown with certain leadership areas in the marketplace, scott, i think, is just something that we've got to obviously keep a close eye on. oil, as joe mentioned, 47. now you're 45. the movements here, the one thing that i would hang my hat on slightly, at least, is
volatility that has sat here in the mid 20s. not just as concerning auz would expect. i would expect on a day like today, that volatility index closer to 27. here we're closer to 24. >> the last three months of the year they've been notoriously bullish. s&p has posted an average gain of 5%. it's the best quarterly return of the entire year. david, a familiar name, to maybe all of you. no recession. low rates. more stimulus coming overseas. >> to have a meaningful move in the year end. i agree with everything he said. i think timing is the issue. i have yet to see meaningful
cuts to guidance and meaningful cuts for s&p estimates, and we know it's weaker overseas because of europe and energy is weaker. >> the valuation hasn't changed. 1830 in my view is still reasonable valuation. i see things setting up okay. i do believe draghi has to come up with more. i think then you remove some deflation fears. >> you get volatility. we know that going forward. what is your thought between now and, say, the end of the year on where this market could be? >> as far as volatility, judge.
what we have observed lately is that volatility is down pretty dramatically. that is the derivative of the derivative of the derivative is down. when you see an explosion in vix, that's usually because the market is moving down rapidly. instead of seeing that right now, the longer dated options that we're tracking, are actually shrinking. the volatility is going down in those. it was up in august as high as 150% or so. right now it's hanging right around 100. again, the derivative of the derivative of the derivative. nonetheless, that's not telling you that people are scrambling. it's more like that they're thinking we could see this retest of 1867, 1870-ish.
>> we have all the forecasts from the fourth quarter, and we are sighting -- all this stuff doesn't matter. what matters is what steve is talking about, what we're all talking about in the desk of let's get the evidence to get you to buy. do you see any of that right now? there's nothing out there to get you excited to go right now and buy. you need that. >> our next guest closely watching the global market picture. mohammed, the chief economic advisor. allianz joins us live. welcome back. >> thank you, scott. >> what's your view of where we sit and where you think we could go. >> i start from the simple notion that we are in a secular rise in volatility. we are shifting volatility regimes. when that happens, if a few
things result. sflo trade up in quality on the rebound, and then look at sector that is have been completely unhinged. emerging markets have been completely unhinged. they're broken in terms of markets. energy. you know what, high yield is on the verge of getting there as you discussed yesterday. there's going to be a lot of exciting opportunities. i don't think this is a beta positioning. this is much more for nimble investors with a lot of market to market risk. >> i'm sure you probably had a chance to either look at the icahn video or hear the highlights, digest it, and perhaps even hear from mr. icahn himself yesterday on the program
saying that in effect the joy ride is over and that a potential catastrophe is ahead. >> what i do think can happen is this market is in dangerous territory. now, again, scott, i'm not telling you, oh, go short everything tomorrow. >> we talk mohammed as well as to whether mr. icahn believes we're in a bear market or if that hab correction, a stagnation of sorts within a longer term bull market. you want to weigh in on that and what he said? >> sure. i mean, i have a book coming on this in january.
fundamentally, he is right. 2008 is about the payment in settlement system. it's about very basic elements. people didn't trust each other. they weren't willing to take simple counter party risks. i think that risk is not the one today. >> it's not happening. therefore, there was a big wedge that has been created resolved between high valuations and sluggish fundamentals. there's two ways to resolve that. the good way fund mentals, val waiting the prices or the bad way, which is a major shake-up in the financial markets.
>> are we going to look back with a higher market and say that was just one of those periods where we're going to go through some pain, but we're going to be okay and the stock market is going to give you the kind of gains that it historically has? >> it could be with one important qualification. 2011 was about problems in the u.s. and problems in europe. when you talk about the u.s. and when you talk -- you have two central banks that are incredibly powerful, committed, and credible. today -- it's not slowing down. >> it is already in recession.
the kre b & the fed cannot reach over there. the difference today is that the source of risk is not within the direct purr view of the central banks we trusted, and i think that is a fundamental difference. >> is the pain in the emerging markets enough to cause a recession here? >> cause of recession, no, but enough to slow us down is this it's enough to cause a recession in europe. remember, emerging markets were the locomotive of growth. now they've become the caboose, and the u.s. is pretty sound, but it's not that powerful to pull anybody up. >> i guess the season is still early. away from that, let's go back to europe and talk about that a little bit. what do you think the probability is that draghi comes out as steve somewhat alluded to in her last -- will that be enough to hold off china and the
emerging markets really having an impact on their economy taking down back into recession. >> the fed has taken its foot a little bit off this accelerator. i think the probability is high. i think the trade here is in the fx market. i think the diverging central bank -- i don't think it's enough again to offset the slowdown in the emerging world, and the reason why is the transmission mechanism isn't that strong.
>> it's possibly a small error. you know, then it's a lose-lose situation. when the domestic signals suggest to get off extremely lower rates and international signals say, hey, be careful, it's really hard to get this balance right. >> he mohammed for us today. john mentioned the vix. mohammed is talking about the rate in advancing for the vix. i think the vix height be the one indicator that tells the
federal reserve whether they go or not. i don't think the federal reserve is making the decision. i actually think the vix is going to make the decision for them. >> i hope you're wrong. >> slowly declining. starting in the summer. >> i thought -- >> we have to go to break. you can finish up. >> we're looking for the volatility fund. they don't exist. volatility used to be a big hedge fund class. it doesn't exist anymore beca e because. >> he is putting some of that money to work today. plus, recode says jack dorsey will be named twitter ceo as early as today. is he the right guy for the job? what will it mean for the stock, which is now down 7% today on reports of this news. you're watching cnbc first in business worldwide.
>> i think if anything surprises me, it's not that the three that are hire, but it's that apple is lower. we heard carl again yesterday pounding the table talking about apple, but he says i'm not recommending it. he kept saying it's a no brainer either way. when you look at the -- >> source of funds maybe. >> source of funds. yeah. i agree with that. i think that is a lot of what we're seeing right now. that's probably why we're seeing apple move to the down side. i don't think it has anything to do with competitive phones or anything of the other different stories we're getting right now. i think it has to do with people are taking some of those profits off the table, and they're looking elsewhere to be able to exactly like you said, the source of funds trade is what's happening. >> all right. well, how about twitter? outspoken twitter investors chris sacca has been founding the table calling for jack dorsey to be named twitter's next ceo. he spoke exclusively to squawk alley just a short time ago. here's what he said about the board.
>> those are the founders that took this from zero users to 200 million users in just a few years. since then we've seen professional managers come in and go sideways with this. yet again, i'm not shocked. i'm as wrup set as i have ever been, but i'm not shocked by this board continuing to screw it up. >> john fort joins us now from the new york stock exchange. he participated in that interview. john, this is highly entertaining, and that was one of the clear highlights. the other one was sacca himself saying i wouldn't buy the stock in a leap of faith just yet at all. >> it was interesting. he wasn't mincing words. calling out peter on the board who is running the search for a new ceo. i think the questions people are going to have is jack dorsey running two companies at the same time. can he do it? especially given what twitter is facing right now, and chris sacca, he has been a cheerleader for the company. at the same time he said here are some things i think the company needs to do.
he is arguing for leadership here, scott. >> do you think that twitter even with dorsey remains at stand-alone company, john, and sort of your gut tell you that they're going to be able to pull this off or is this something that is just prepared to be taken out? >> well, growth is the real challenge. >> not only does it continue growing or that people are skeptical that it could, but its acquisitions, instagram, and what's app. part of the pitch to those companies, looj, we have this growth hacking thing figured out. we can help you grow. reach global scale. i don't think you get jack dorsey back at the helm because you are addressing the company up for sale. there are certain kinds of ceos you can bring in from the outside if that's what you are looking to do. you have to expect that the company is expecting to give this a real push. at least for a couple of years. the question for me is does the
boa board. >> they've tried a few things. dorsey, i this i, is behind some of these things. how about this buy button? are they searching in the right direction right now with some of where they're pointing themselves, or are they just flailing and throwing anything against the wall? >> i don't think they're flailing. on the revenue side, run by adam bain, they've been extraordinarily crisp. even over the last few quarters, this buy button is a step in the right direction. it's good that engineering got it out. i as an observer of the impression that they need to move far beyond this 140 character limit core twitter product. it's just not catching on with the mainstream, and the way that something like an instagram where there are photos that bring forth emotion and easy way to connect.
>> i'm want sure there is a message. these short-term moves, especially on a stock that's so heavily shorted have benefitted from shorting historically. at least in the immediate wrum term and medium term history looking back. i'm not sure that we can gather too much from that. the question is how does the board articulate how they came to this decision, if it is jack dorsey, given that he was the one potential candidate who they seem to eliminate by saying you will only even consider people who are going to be able to make a full-time commitment. how do they articulate the process? what happens to the board's composition after this announcement?
that perhaps takes a couple of months to completely play out. that's what i'll be watching. >> john fort, quick question. john here. as far as the board and what they said back then and basically how they have reversed by agreeing to take jack dorsey, again, as ceo, knowing that he is indeed going to be running these two companies, don't they lose all credibility? isn't that the biggest reason why the stock is down 7% today. they're as bad as the fed as far as accepteding one message and doing something else. aren't they, john? >> well, john, you're a better expert on stock moves and the causes for them. i have been saying for a while now, that that statement from them is a concern if they do end up naming jack dorsey ceo. it's not just that. it's also dick coming forward saying i have the support of the board over and over again. nobody sending out any message different from that. all of a sudden he is out, and
from all indications, he might be leaving the board. even after in his stepping down from the ceo role, he said he was going to stay on the board. what exactly in the messaging from the top of this company can we believe? they definitely need to address that. >> jason, the well known angel investor who has been on your program a number of times, emails me and says there might be a commitment from dorsey to put a professional ceo in charge of square and that he thinks that square could get bought and that jack is the full-time ceo of twitter alone within 12 months. you want to opine on that real quick before we let you go? >> all that could happen. henry was just on our program saying he thinks within a year jack has to make that full-time commitment to twitter, and there's always a possibility he takes an executive chairman position at square. something along those lines. he doesn't have the permanent rings there. we'll have to see, scott. >> all right. john, thanks so much. >>. >> it's time to get into biotech
names. it's the call of the day. a microsoft upgrade. earnings report ahead for micron and trouble at dunkin' donuts. it's all part of our trader blitz, and it's next. you pay your car insurance premium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it? if you have liberty mutual deductible fund™, you could pay no deductible at all. sign up to immediately lower your deductible by $100. and keep lowering it $100 annually, until it's gone. then continue to earn that $100 every year. there's no limit to how much you can earn and this savings applies to every vehicle on your policy. call to learn more. switch to liberty mutual and you could save up to $509.
>> trade stocks. >> netflix's balance sheet -- >> not all in on this whole thing wrr this also raise the price target. they talk about the die lugs of nokia, and that's behind them. also the net cash, and they talk about some of the comps being a little bit easier tore them to reach. i think all these things, and you look at the cash on the balance sheets. there's a lot of reasons to like
them right now. i think nodella has moved the company in the right direction. we'll see if it gets that stock moving up towards the high. closer to $50 rather than $44. >> there will be a comeback in the fourth quarter for micron? stocks down huge year-to-date. >> i think first you have to have that kitchen sink type of conference call. you may actually get that for the very first time. they'll give guidance on the forwa forward. >> most people have a buy rating on it. pricing continues to be weak. pricing continues to be weak.
sfwa our food sector specialist josh brown is out doing research today at tim horton. i had to take this one. weak forward guidance. that always hurts. doesn't matter what business you are in. that can be bad, judge, and they announced, yes, they thought this would be good news. mobile where you can basically preorder ahead. i use some for strength now. you have no idea. >> they'll roll it out by the end of next year. same-store sales are great. that guidance was terrible. that's why the stock is down 11%. >> along the east coast, or is the east coast -- where on the east coast is that hurricane going to hit?
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sfroo hello. i'm sue herrera. here is your cnbc news update this hour. israeli prime minister benjamin netanyahu making headlines. prime minister saying that his country will respond forcefully if attacked by sear wra and will not allow iran to "sneak into the nuclear weapons club." the eye of hurricane joaquin passing over the bahamas bringing with it strong winds and heavy flooding. meanwhile, cities along the eastern seaboard are preparing for the worst. forecasters expect joaquin to make a turn towards the u.s. tomorrow. afghanistan's president says government forces have retain control of kunduz from the taliban. >> peanut butter for the massachusetts based steam. the company has created an all natural caffeinated peanut
butter, and it says just two table spoons of its creamy pretty is the same of drinking two cups of coffee. that's the cnbc news update this hour. i know some of you on the desk there are big prop ownents of caffeine. we'll see. >> bagel with peanut bitter on it. >> you're caffeinated for the whole day. >> thanks. take a look at the markets right now. we are off the worst levels, but the fourth quarter is beginning to be reflective of what the third quarter was like. one in which the dow was down 7.5%. the s&p down 7%. there's a look. the dow is down 160. that's a loss of nearly 1%. as we close the books on the worst quarter since 2011, what is the best playbook for the fourth quarter? let's ask someone with skin in the game. eddie perkins, the cio at eaton vance which has $3 billion under management. it's nice to see you again. >> it's good to see you, scott. >> history is on the side of investors. is it going to play out that way this time?
>> i think it is. >> since then the ten-year -- the yield on the ten-year has moved lower. we've had the selloff, of course, in the market, and utilities have been the best performing sector. reets have held up relatively well. i think it's time to move away from that defensive posture, take advantage of some of the cardinalage in the market and begin to put risk back in the portfoli portfolios. >> what kind of move could we have even reflective of the kind of risk that is still in front of us? >> the fourth quarter, the year end is often a time when the market rallies. you know, october -- november, rather, through april tends to be the seasonally strongest time of the market. you get almost all of your return in the market historically from that period. we could have a strong rally in the fourth quarter. we'll have earnings reports coming up soon. i don't think it will be a particularly strong earnings quarter. i think that's well understood by the market. maybe we'll get more clarity
from the fed. china seems to be stabilizing a little bit. there are reasons to be opt mythsic and hopeful. we're going to be lapping the head wind of the dollar and lower oil prices in the next quarter. i think people will want to put risk back into the portfolio wrshz. >> you agree with some of the thoughts we've already heard. i referenced a note that was out earlier today thinking that the third quarter would be the bottoming process for earnings. then you could start getting past that. i just wonder how some of the other risk factors -- factor into your own thinking. notably, a rate hike which the fed seems intent on doing before the calendar year is over. who knows what kind of news we're going to get out of china and the emerging markets over the next several weeks. >> yeah. i think the fed will hike rates in the relatively nir future, but that is completely understood by the market at this point.
sfa toumt serve them up for us? >> i like one in the bank space, citigroup. trades around one times tangible book value. really heap. really beaten up. it's got some emernling markets exposure. that's what people are worrying about there. they seem to be doing all the right things, and i like citi. i also think in the other cyclical part of the market and semis. intel, it's chicken semis, but i like intel a lot, and we own that in our portfolios. >> doc, you got a question snl. >> no, he answered it really with the bank space because i
was a little concerned about citi, but you would just address it as far as the -- i would agree with you. >> and steve has a we for you as well. >> here's a question. an undercurrent that hasn't been talked about that we see hitting the stocks. tenant health care has come down from 60 to 36. part of that directly concerning their credit quality, which i think is -- altice has come down dramatically because of their balance sheet. >> widened out in the bond market. for those paying attention to the bond market, it really led this selloff in equities. i think it was the canary in the coal mine looking back.
for those companies that are heavily emundebted that need to -- i think it is something that you have to pay attention to. high quality companies with strong balance sheets. we like the cyclicality, and the exposure to economic growth. we're very wary of heavily leveraged companies. >> thanks. >> all right. after a powerful morning rally, giving up all the gains for the day. jackie deangeles at the nymex. swraky, maybe that's one of the key points of why the market itself sort of rolled over. >> it could be, but this is very significant roll-over that we're seeing in crude oil, and i want to dig more specifically into that. we touched an intraday high. now we're hovering around $45. anthony, what spooked the market? >> yeah, jackie. it was the dow. when the dow started slide, you saw crude oil slide, and i would argue that crude oil would be much lower because of that four million build we had in supplies yesterday. why isn't it lower? because of the tensions in syria
with russia getting involved. >> scott nations, when we look at the charts, traders tell me we are poised potentially to break out to the up side, but the fact that we test and failed today, could be significant. yes? >> we spent all of september getting ours into this tight wedge zeroed in right at $45 a barrel where we are at right now. if you look to the up side, there's a bunch of overhang. whether it's the $50 that was rejected at the end of august or some approximate moving averages at $51. the path of least resistance, technically, is probably to the down side. >> for more futures now, more on crude, we're also going to be talking gold today, at 1:00 p.m. eastern time. tune in to the show because we're speaking to michael. he actually says the gold bulls shouldn't be worried about the fed right now. tune in. futures now.cnbc.com. scott. >> jackie, thanks. the battle for trader of the year in our portfolio challenge. joe in the lead. pete has only made one trade. will he make moves in the year
end? that's what it said. that's why i read it. all right. >> i got some room, though. i got room to trade, brother. yeah. here we go. >> plus, our call of the day. one firm says now is the time to buy beaten up biotech. you follow the lead or stay clear? our desk weighs in. you're watching cnbc first in business worldwide. opportunities aren't always obvious. sometimes they just drop in.
coming up at the top of the hour on "power lunch" commodities correcting q3. what's ahead in q4? bank of mechanic's head of commodities will be joining us, and he sees a 40% rally in that. he also expects a rally in oil. plus, why tech may be the place to be in the fourth quarter, and there were $63 billion in mutual fund outflows in the last three months, and that is the big exodus in 30 years. is it signalling a market bottom? we'll discuss that as well. make sure you join us at the top of the hour.
back to you. >> still beating the s&p as we head into the fourth quarter. although we do have stephanie link, jim, pete, pete, pete -- >> yeah. i see you. >> did i say pete? >> got my big trade going. >> you are somewhat backed into the corner. you have to own a number of stocks you already have because of the amount of trades you made. what is your strategy as we head between here and the end of the year, if you have one or thought about it? >> i have thought about it, and i do have a strategy, and the strategy not just for this, but i think for 2015 is pretty well defined. the template is out there, and it's what's worked in years past. winners will win. losers will continue to lose. i think that's the strategy for the fourth quarter. i don't want to is often referred to as dumpster dive. >> you don't agree with eddie
perkin and some of the other thoughts out there that, okay, biotech, health care is so banged up that it's primed for a rebound, and some of the other areas are the prime places that you want to look if you want to get some nice gains between now and then? >> all of biotech is knocked down. >> you say stick with what's not working. >> in health care facilities and equipment are wonderful things to own in the health care space. i'm not going to buy something that's down 60% on the year and hope to capture a 15% up move. there's going to be significant tax loss selling in a lot of these names this year. take a name like an amazon, which is done relatively well we're to date, and done relatively well most importantly over the last three weeks when the s&p looks horrible. >> what about you? you're not that far behind swroe. >> no, and -- >> you have made up a lot of ground too. >> i wish there were trades to be putting on. you know i like tech. i like that sector rally as far as consumer discretionary play. joe just mentioned, amazon.
amazon and best buy would be at the top of my list for that for this fourth quarter. i am also pretty heavy in tech right now. it's almost been a place to hide out, actually, lately except for apple. that's been working, and apple is just one that confounds me. it's not in my portfolio, but it confound me that that stock managed to go down another couple of bucks today. >> you're looking over -- >> yeah. >> i got plenty of time. i'm looking at things. my beggest concern right now with this -- had i not made a trade, john pointed out, i would be in the lead. unfortunately by flipping into apple and back to baxter, that's put me in a bad spot. i actually have plans to make some trades. >> look, if we're going to get a rally of any kind between now and the end of the year, you're in the right place. >> i'm in the right spos with citi. >> a lot of stocks have come down so much. >> if i'm right about what i think about the banks, citi, i'm already in there.
that's given me an opportunity. >> finally get rid of xp. mario and i talked about that when he was sitting on the show. he liked that name as well. unfortunately, you know, he has awe lot more of a time frame in front of him. we've got the we're. it's not probably going to perform this year. that's probably the number one name right now i'm going to get rid of. it's likely going to be a financial. >> i think go all in -- that's the plan. >> i got 49 trades left, brother. >> you can catch all the action cnbc.com/pro. coming up next, the biotech trade, one of the worst performing sectors of the third quarter. piper jaffray, though, says, well, that's why it's time to buy it now. we're going through the picks next.
so is it time to buy some of the beaten down biotech names? piper jaffray says yes. steve, you were asking eddie per kin about this space. what's the trade? >> i think there's a time to buy biotech and i don't think it's now. you're seeing a rerating of it in large institutional portfolios and they sell in droves. we have a small allocation to health care. our manager was telling us evident at a conference and one of the analysts there asked a noncommercial biotech company what their free cash was. so they have no free cash flow. it's tourist trade. i think you have to wait for it to settle.
compelling values but the small and midcap i'm staying away from. >> this note specifically says, as they have in the past, we expect large cap biopharma to lift the sector out of the weakness. they like celgene, am gene, endopharma. >> i don't like at amgen or gilead as biotech. i look at them as near pharma because they have mature product lines and pipeline behind it and they're cheap, cheaper than pharma. much cheaper. >> 60% of the biotech companies in the nasdaq have negative earnings expectation 12 months going forward. it takes you to the strategy they're talking about and looking at large cap names if it's going to be lifted out of the doll drum, it will be large cap. >> that's what we talk about all the time. we rarely talk about the no earnings biotechs everybody wants to cast a huge net that it's all about all of biotech.
there are areas that we all talk about all the time and i think the big cap names amgen, ce cellgene, they are the names being unjustly selling off. you look at some of the names, they talk about in the note gross sector poised to fly higher. completely agree. i look at some of the names, steve is talking about these names are like big pharma. they are. mature pipelines, but they also have mature drugs right now in the pipe. >> doc, are you doing any of them? >> i'm not in any of them right now, but i will bet you that over the next three or four weeks we will see one or more of these big either if you want to call them bios or biopharmas make a purchase and when they do, both stocks are going to trade up. the acquirer and the one that they're after are going to trade up because that's how beaten down it is. >> quick. >> let me go back to ex spearian which i pushed.
stock -- i did okay. i'm long long gone but he had a great call. so that stock is now 23, peaked at 120. i think that's indicative of a lot of one-product companies. >> three hours left in the trading day. quick break and we'll game plan you for the second half. awe believe active management can protect capital long term. active management can tap global insights. active management can take calculated risks. active management can seek to outperform. because active investment management isn't reactive. it's active. that's the power of active management.
markets close in a few hours. pete, what do you see? >> look at fireeye. these options expire tomorrow. you want to talk about fast money, that's fast money perpendiculthey were looking at 32 calls. we'll see if fireeye can get through 32 and hold above that going into tomorrow. >> you have something on crm. >> sales force.com. they came in, same story as pete. came in for tomorrow expiration calls. they bought the 70s, then the
71.5, and the 71. they buy more and more as this stock breaks through 71 and runs to the upside. i'll probably be in these less than 12 hours. >> a minute left in our hour. weiss, do you have a trade? >> i'm just looking at the second half to see how the market holds up. also hedge fund numbers are coming in -- >> they're not good. >> some headlines are terrible and those should be expected but generally the hedge funds are beating and handily beating the s&p and long only managers as we've been talking about. they make the money off the short side. i think hedge fund performance will continue. from our funds right now i'd say that year-to-date we've got two funds that are negative versus the s&p down over 7%. >> some of the big nails, some of the stars of the business, had a rather rough go of it over the last month. >> i would be deliberate in acting in the marketplace tomorrow. you have the jobs report in the morning. you have a looming hurricane on
the he's coast. i'd be very, very patient. give it some time before doing anything. >> i'm holding crm and i'm going to hold it into that report tomorrow. >> all right. keep a close eye on the markets between now and the end of the day. "power lunch" always does that. it begins right now. scott, thank you. we're going to do our best to keep our eye on the market. welcome, everybody. stocks struggling as we kick off the fourth quarter. you thought october was going to be different? you would be wrong. there are the numbers. big red numbers for all of those markets except for the transports which are up just a little bit. >> the automakers are in high gear revving up strong double digit monthly sales, but will they be able to keep pace from now until the end of the year? that's our question. >> commodities one of the big story this is the third quarter. crude down off 25%. what's ahead for commodities in the fourth quarter? bank