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tv   Closing Bell  CNBC  February 8, 2016 3:00pm-5:01pm EST

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bubbles brewing within the tech sector. you'll want to hear what he says where the bubbles are. >> still, even with the sell-off. >> okay. looks good. >> thanks very much for watching "power lunch". >> "closing bell" starts right now. >> hi, everybody, welcome to "closing bell" i'm kelly evans. welcome ba. >> what i welcome back i've gotten, big sell-offs following friday's big sell-off. not one sector that's causing this today. you get the financials and energy and technology and in fact all ten sectors of the s&p are trading lower right now. the dow right now down 350 points off the lows. >> and even facebook and google and sales force are not safe from the latest sell-off. we'll discuss where to find growth worth buying. >> t.d. ameritrade's chief
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strategist will join us to talk about what their clients have been doing in the last month, they compile all of the trade data. what did their clients buy, which stocks? which did they sell? it's revery instructive. >> coming up in just a bit, joining us at post nine to tell us why he believes u.s. banks are still in much better shape than europe's and we're standing here in front of barclay's and this is a name halted in europe. added to the list of deutsch bank and concerns people have about today. we'll hear from mike mayo whether the u.s. sell-off should be included in that. >> when the 10-year is at 176, whether the negative rates, they are suffering in europe, whether that's going to spill over here to the united states. >> markets are trying to price it in right now. >> first let's get caught up on what's happened so far today on the new york stock exchange
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right behind us there is one , b bob, we didn't see it come back a bet when europe closed as often happens. >> that was a little bit of a disappointment. the selling dissipated a little after 11:30 but wednesday again we're sitting essentially near lows for the day. people are asking whether we're heading for a bear market or not. let me put up with the european stock markets have been doing. i'll show you the percentage off from 52-week high, germany and france at historic highs not long ago and spain not quite. if you define a bear market, it's below 20% off the recent highs, they are already there essentially, we're not -- let's no quibble too much about whether we're in a bear market or not. i want to show you what's going on. we had deutsch bank, trading here in the united states and as well as in germany. and there you see deutsch bank, almost down 9%.
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deutsch bank is more than 30% for the year. that's breath taking drop for the biggest bank in germany. but also the european banks in general have been the epicenter of the problem. ubs trades down here. here it is down 4%, 2.5 million shares changing hands, that's a pretty significant amount. not quite as bad for ubs, down about 25% for the year. you're talking about one of the great swiss banks of the world down 25% in 4.5 weeks. that's quite a decline overall. the euro bank issues we've discussed them before and put up the talking points, declining revenues the major issue and restructuring and litigation charges for them, flattening yield curve, withdrawing from key markets, many of them not making markets in bonds and stocks like they used to because of regulation issues and i think the most important issue is the overall book value. there are concerns there may be more asset write-downs coming. many of the euro banks never had significant write-downs that the u.s. banks went through and perhaps that might be coming.
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that hasn't happened yet but that's the overall concern. all of this is sort of flowing into the united states. we're essentially sitting near the lows of the day. >> a little bit more of the financials in just a bit but look in the meantime at the momentum plays getting taken out again today. dom? >> kelly and bill, to follow along with bob pisani is talking about. it's no see krelt the financials are some of those momentum plays and it's been to the downside. there are other parts that traders are paying attention to. for signs plapz that there is nor downside to come despite whatever bullish narrative there is out there. first of all, want of the star pore fe per fomer from last year, if you look at the 5% move in the context of what happens for the past year, a huge move higher over the course of 2014 and trying to trail off a bit.
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a large mega cap stock. the other one is netflix as well. one of those larger cap momentum plays, a top performer in the s&p 500 last year. we're off the worse levels by a percent or more. if you look over the past year, 12 months, you can see huge move higher, only to kind of start tailing off at the end. is the momentum waining here. industry groups as well like biotechnology stocks and ibb is the nasdaq biotech exchange traded fund, the ticker. ibb today off by 4% as well. over the past year, again, we've seen this downside momentum continue when health care and biotech stocks down still 22% over the last year. one last place to look among the many and that's small capitalization stocks, down by 2 2.5 today and showing real weight on the overall market.
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down by 20% over the last 12 months. again, bill and kelly, it's not just momentum stocks like market caps and small ones out there, all of them showing signs of stress in the overall market. back over to you. >> domest, thank you very much. yelp was supposed to report earnings after the bell tonight but instead somehow the numbers made it out in the middle of the day. josh lipton has the lowdown on that early release and the aftermath. the aptly named yelp, what they got, right? >> well, bill, yelp did report early, pinning the blame on a vendor error about a pr newswire. they don't like what they see. reporting a loss of 2 cents on revenue of nearly 154 million. the street had been expecting a loss of 3 cents on revenue of 152 million.
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but the worry some number here was the key one guide of 10 to 12 million. th did miss what the street expected. separately the company also announcing that it's cfo is leaving. yelp now down more than 40% so far this year and more than 60% over just the past 12 months. the big worry, yelp depends on search engines line google to drive traffic. google is pushing its own reviews and pressuring yelp. they are countered by emphasizing its mobile app and boosting marketing efforts but that strategy clearly not winning over investors want to learn more about the company's game plan on the conference call which kicks off at 4:30 eastern. back to you. >> josh, now let's talk about what's going on right now, kick off this monday with our closing bell exchange. anthony chan from chase is with us here at post nine and so is steve grasso from stewart
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frankel. a lot of traders are getting caught up after my vacation. i can see this weariness in all of your eyes. every single trader i talked to today throwing up your hands, there's a lot of pain being felt in this market right now, isn't there? >> there's been a lot of guys that felt negative on the marketplace, if you're early you're wrong. when you see the market start to fall people scratch their head and say what do i do now? unfortunately we're hitting key levels here and we haven't hit any support yet. it's 1812 is the level you should look at, s&p cash and we're 1835 right now. i don't know if you can step in and say there's a bottom when china every day there's another negative headline or oil has not formed a substantive bottom. we do crack that 2655 mark. then it gets to be a teenager
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again. you and i had this conversation offcamera, 1994 is the 2001 level in oil in crude. i do think that we test that 2655 and then who knows what happens because supply cuts aren't really effective and no one is doing it. >> we're showing crude there trading below 30 bucks. people have said is that low oil should be good for the country, china is not going to be a huge problem chblt at what point are the markets deserving policy makers take quite seriously their concerns and listen and perhaps respond to them? >> remember, kelly, in the last seven years, u.s. production has basically doubled and we know at the low oil prices, it's more than 60% positive correlation between what happens to oil prices and the market because everyone is convinced they don't care whether it's a supply or demand or if it's low, that must mean things are wrong or going badly --
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>> anthony. >> suffering because of oil but we're still a net oil importer in the country. >> my point is there are three factors people would look at and say all of these things should be good, low oil, maybe even a stronger dollar and say china shouldn't affect us that much. look at the markets, we're talking about major indexes back in 2014 trading levels and vix up over 27, key things like transports in a bear market which she shouldn't do if low oil was so good. at what point is the message in the markets worth paying more attention to? >> when these markets continue to stay low it has the risk of impacting consumer confidence. when that happens then you know you are in for trouble. if you look at the u.s. consumer confidence measured by the university of michigan, we know that today consumer confidence is a whopping 10 points higher than the average it's been during the last start of the last ten economic recessions.
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only one recession has had consumer confidence just slightly higher than where it is today. consumer confidence is telling us there's only a 10% chance of a recession. i believe it's higher, maybe 25%. on the confidence that 70% of the consumers are the ones that determine the economy, they are only 10% telling us problemability of a recession which is a killer of any bull market. >> here we go. 176 on the 10-year, dollar lower, hitting multiweek lows and gold briefly at $1200 to the ounce. what are those markets telling you today? >> i liked kelly's angle better. there was a team where some of us were belly aching, don't look how much we trade with china. let's look how the gearshifts are all connected to the transmission together or the dollar's strength. let's not necessarily look at that but the huge positions in the carry trades, all of these
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are coming back. we're at 173 in the ten which means we're down 54 basis points for the year and good chunk of those have come as quickly as to 220 down to 147 tesla shares. i know there was a team everybody was chuckling at my tesla comment but i think when you look at a momo stock it has to be a macy's main window because the notion that somehow a new chapter of central banking activity is going to peg that stock back close to 300, is a mug's game. i think that the transition that we've come to not only in the states and investors psyche and global investors psyche, they now see through policy of liquidity. they see what's happened when it's slowed down even just a little. they have seen what happens when others promise more to make up for those promising less and it still isn't making a difference. i think reality is dawning and i'm not so sure that the
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leadership role in the fixed income which transition from the five-year to the ten-year today, the ten-year is down more year to date. i think that's actually a good sign and i would pay attention to that 114 to 125 year level as all of the rest maturities play cat catch-up, maybe things will level off a bit, which seems contrary to what we're feeling today. >> it's 173 on the 10-year. >> down 54 basis points on the year. they were already low. >> it's a round turn in the last year. we were at those levels a year ago in january, late december of '14 as well. >> rick mentioned some glimmers may be here of a positive signs. there's one place people have been watching, the industrials the last couple of sessions, steve grasso, a word if you don't mind, the industrials have been beaten down and let us lower. if they can get traction, maybe
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because we've priced in negativity, that would be a sign of things finding a bottom and process. how do you read the industrials for this market? >> i think they are important but what's more important -- i do agree with your statement, if they can get footing, that could mean a sure term bottom or more substantive bottom market. if we're repricing multiples on tech, we have to reprice the multiple on the s&p and erveg everything. all multiples come in. >> how much credence to do you give the vix, it's only -- the last time we were at these levels in august it was at 40. so is there a -- does that say we're not at the bottom yet or do you pay more attention to the yield of the 10-year and price of gold right now? >> for me the yield in the 10-year is probably a little more important and i did say before the fed was raising rates, i do believe they have
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the back in a corner and up against a wall. i don't think they should have raised rates and don't think they'll fall for it again. i think they are pushing us ever so fast into a recession. we're already in a manufacturing one so -- >> we'll let you and anthony talk about that and have differing opinions on that one. thank you, everybody. >> let's get a market flash on under armour. dominick chu, i have a feeling you'll be busy. >> this is the kind of market action that has a lot of traders trying to figure out what's going on of the under armour, that sector hitting the lowest levels since 2014 at one point during the day, down nearly 8% just off their worst levels today on heavier than average volume. calling your attention to the stock only because it's been one of those real outperformers over the course of the past couple of years and joining these momentum names down big in today's trade.
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under armour shares a focus for some traders, has been seen as a proxy for momentum side of things, especially discretionary stocks. bill and kelly, ua stock a big folk u. we'll look at as well as these other momentum names we've been referring to all afternoon long. >> i have one question going forward, what's the dividend yield? the more the people talk about negative yields on debt, the more they look for anything with a dividend and dropping anything without one, no matter what they say in finance theory about corporate buy backs. >> let's look at oil dropping below 30 bucks a barrel. jackie has more. >> good afternoon. certainly as we head into the close and finish at $29.69, just around session lows for wti, that's when the dow hit session lows as well. you'll have those point their fingers as oil as one of drags
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here. what's interesting is we've been talking about this market being driven by technicals and kind of rally we saw last week, it was driven by rumors, opec, maybe meeting with a nonopec producers and talking about a emergency meeting or production cut. none of it really materialized, saudi sources telling me those headlines were manufactured by the weak pro youers hoping they would see something like that. so the selling today makes sense and the close under 30 as well. we're back to the fundamental story here in the united states, we have 31 oil rigs come offline yet you have production at best flat lining at 9.2 million barrels a day. a lot of companies are saying that it's all about keeping the wells drilling and continuing to sort of weather the storm here, at least there's speculation that's what they are thinking at this point. the general bias guys, knneutra to lower is what traders are telling me. >> how long have the prevailing
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wisdom smart people been saying production is going to have to come down in this country and it just not happening yet? >> i don't want to be a broken record, guys, but this is the conversation we have every day and it's not my bias to the down side. it's looking at the fundamentals and looking at the numbers and being an lit cal about it. until we have something that substantially changes these numbers, a lot of people were saying the saudis miscalculated here and they are really que squeezed. i think they can weather the storm too. you have u.s. producer sazing we have to stick it it out and continue to play this game of chicken. i will add one more thing because this is a surprise as you've been back here, we haven't talked about gas prices in a while, $1.74 is the national average. we've come down 44 cents since this time last year. i mean, that's very significant. >> i paid -- we went through tennessee during our vacation and i paid $1.44 it was --
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>> it's remarkable. >> i was giddy. but a wide range, the lowest was $1.44, highest was outside washington, d.c., 2 .19. >> that could get even wider, we're about to see more proposaling to raise the gas tax. in parts of oklahoma, they might go to a four-day school week. this has been a dramatic change of fortune for these states, still dealing with the fallout. thank you. >> thanks jackie. >> 40 minutes to go in the market. it's not just oil but the whole financial complex, dow is down 271 points, we're 100 points off the lows. >> we were down 400 at one time. >> ouch. >> we also see the s&p down 36 points and nasdaq out 2.5%. here's the broad market s&p 500, only about one in ten names is green for the moment. i will add, bill, tyson foods, trading at all time highs today, there's your positive
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outperformer. >> there have been some highlights for sure. meantime, european banks have been leading this global sell-off today with u.s. banks not far behind. despite that, our next guest has turned bullish recently on u.s. banks after 17 years of being a bear. wow, how funwise that? >> mike mayo, managing director. is your head spinning? >> this is the option of 2006. we were negative for a long time up to the crisis, through the crisis, but in 2006, banks had weak balance sheets and today the balance sheets are strong. so if you want one number, one number to sum up the strength of the balance sheets, it's 1.7 trillion. that's the equity of the u.s. banking industry. 1.7 trillion. it was under 1 trillion a decade ago which means you have a $700 billion extra buffer compared to a decade ago and charge off
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every dollar of every large energy loan and charge off emerging markets and debts and still be ahead where you were a decade ago. the concerns spilling over, so overdone. >> that was going to be my question but you add in the fact that the fed may not be able to raise rates given the weakness in the economy and the markets right now. that's a double whammy, you're discounting the weakness out of european banks right now but what about the impact of the fed as well? >> don't forget, we have a suz fed stress test, it's more stressful than the actual experience during the global financial drcrisis. there's all sorts of assumptions of loan losses quadrupling through the current level and at justed revenues going down by half. you can factor in all sorts of scenarios. we do call this bank stock sell-off the ice sell-off,
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interest rates, china and energy. so those are the three issues hurting the banks and talk of the town is negative interest rates, seem to be on the table and that's been exacerbating the recent decline. >> i wonder to what extent this is a huge seat change in expect agtss, this is going to be a normal u.s. economy and interest rates will go up and banks will have a leg to stand on for years and japan credit crunch that plays out for decades, that change of mentality seems to play out in front of our eyes? >> we have 200 pages of research and i worked with our japanese bank analysts and there are certainly similarities with what took place in japan. there's also major differences, we still have better growth. culturally the u.s. is different and the financials are different. a lot more fee revenues or consume every lending and culture that encourages risk
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adjusted lending. so we're putting these blanket labels on u.s. banks which are xree extremely inappropriate. that's why we even upgraded the bank that we are most angry with and that's bank of america. it takes a lot for us to upgrade -- that shows the conviction we have with u.s. bank stocks currently at a level in 1997. >> is it possible you're early with this call? >> there's a lot of pain in 2006 with being negative and you see the movevy "the big short" and i'm willing to withstand pain. it can change in a day or month or year. >> it's funny you mention the big short, steve iseman has an editorial, take it from me, i'm the guy who saw it coming last time around and i'm telling you the banks are in much better shape. i hear what you're seeing and
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he's saying, is it possible though that it's going to turn out in retrospect that there's still some link that we're mentioning, rational reason why the names are getting hammered so much? >> what the article mentioned, leverage, leverage is dramatically less at u.s. banks. you have a cushion to absorb unforeseen problems. i can't tell you every problem that can come and bite the banks but the banks have a cushion to absorb unforeseen problems. >> not to oversimplify but to make things better for the banks, rates have to go up and they are not going to go up right now, right? >> that's a definite head wind. if rates don't go up by the end of next year, that's a 10% earnings headwind on the large banks. compare that to the stock price declines double that amount. you're discounting no rate heights or charging off all sorts of loans and a recession. three other words, do the math.
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we've done the math and we show banks like jp morgan and bank of america, book value would grow through a recession. we have these -- a lot of noise in the market but if you do the math it gives you the conviction to say this is a unique buying opportunity for large u.s. banks. >> could you give us an example of how negative interest rates, however negative that rate might be, how does that impact pick one of the u.s. banks? how does this flow through -- tell us what that scenario looks like. what should investors be scared of or not scared of? >> if we had no additional rate hikes, the interest is the margin, twice the level of the european banks and twice the level of the japanese banks. >> not hard to do though. >> could get hammered, but the mistake we think people make when you do the math is that credit costs are not so bad. low interest rates a lou a lot
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of people to pay back their bills. what we think will be the positive surprise, is that credit quality, large u.s. banks will be good over the next year. >> negative interest rates though, with the banks priced at these levels, does that mean as the bank they are paying the fed to hold reserves? how does that effect how depositors react to that. >> negative interest rates would be counter productive. we know what's on the table and europe has been doing it and now have japan doing it and stanley fisher mentioned it's a possibility. we're exploring the idea and negative interest rates are part of the fed stress test. having said that, it's counter productive and not going to encourage banks to make more loans. it will crush the net interest so banks won't want to make loans. if you want to push the cost to the customers that could cause a deleveraging of the balance sheets and not encourage growth. it shouldn't be likely.
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if it happens, we have to take numbers lower. >> ladies and gentlemen, mike mayo pounding the table for u.s. banks. amazing. good to see you, mike. >> thanks for being here. >> joining us now as we continue to ee val wait the impact at further declines in the market here today are having, shawn matthews, we really appreciate you joining us. >> thank you, shawn. >> having been through cycles before. what would you say you think we're experiencing right now? >> certainly the market is now trying to absorb what's going on first in the credit market. if you go back six months the credit markets were starting to see cracks, emerging markets clearly at that point in time were see s massive widening and now seeing the equity markets absorb what happened in the marketplace, cost of capital has gone up and ability to actually source liquidity is tough in the marketplace. everyone has a sense of fear and
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panic right now. we'll get through it, it's not the end of the world. >> let me ask you it another way, are the markets responding to our fundamentals or expecting a recession here oral is this what's going on overseas? a trader said to me today, china, dollar, oil, rinse and repeat, that's scaring the markets right now. is it those things out of control or is the market actually reflecting fear about our own economy do you think? >> well, i think those are the drivers but they all come back to what's going to happen here. most of the companies are multinational companies that have earnings streams from lots of different places, talk about china and energy complex, all of those things come into play when evaluating the present value of what an equity is worth. i think people are focused on the u.s. and are we going into recession or certainly a slowdown but it's the bigger
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macro theme in place and there's a lot of concern out there. >> shawn, i guess there's a couple of reasons why we could see stocks selling off because the business cycle is ending and recession looms. the other is some kind of credit crunch. in other words, there's two different things that could be happening here. how do you noel if we're witnessing a replay of the kinds of event, maybe not in scale or magnitude but in nature that we're witnessing in financial markets compared to the last crisis? >> if you look at the last crisis, there was a tremendous amount of leverage? the system. i agree with mike in the last segment, the u.s. banking system is in very good shape and poses ibting value opportunities to purchase. when you look at today, it's now about a prolonged distress cycle. in reality at the end of this cycle, you had a tremendous amount of covenants like paper
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issued. all of that has no test it has to adhere to, which is why the energy complex people continue to pump out production because they have to get cash flow. that's really what's going on in the marketplace, it's being caused by a tremendous amount of covenants like paper and that real little creates a prolonged distress cycle which we'll see for the next couple of years. it's a prolonged distress cycle. >> are you worried about liquidity in the credit markets? that was a fear some months ago. >> i think the liquidity is pretty scarce right now, if you look at the marketplace, you had a tremendous amount of participants in comparison to the size of the market in the last crisis. so in 2008, if you looked at the street and banking system, it put a tremendous amount of liquidity into the markets. that isn't here now, you're
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seeing vast moves and asset classes because there's no one to sit in the middle and actually figure out where value lies. so i think it's just the pendulum shifts too far one way or the other. and that's the new world we live in and i think the investor class will have to get used to it. >> thank you, shawn. >> please come back as we watch how these events unfold. let's head back to cnbc headquarters for another market flash. >> kelly, bill, let's talk about another one, let's talk about momentum stock, tesla shares hitting a fresh two-year low currently down by close to 9% on heavy volume. this is credit suisse lowered it's 2017 earnings estimate. it used to be 5.55 the. they cite slower than expected model suv production and analyst remains bullish saying it
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doesn't seem to have any fundamental issues now production concerns have put shares under pressure as of late. down more than 30% over the past year. tesla reports earnings this wednesday after the closing bell. so again, tesla a big focus momentum stock and bill, again just to put it in context here, the average daily trading volume in the past three months is 3.5 million shares, todays already pushing around 8 million shares and we haven't closed trading yet today. >> thank you very much. if you're just joining us, a sell-off clearly but it was a lot less a little while ago. it was about an hour ago when the dow was down 400 points. that so far has been the low for the session today. the dow is down 231 points. the s&p down a like amount and nasdaq getting hit hard, technology one of the big losers. >> also what happened an hour
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ago, the oil settle. we talked about how the risk in the market is more from that but maybe it's still putting pressure on the space. we're down 233 at the movement and meanwhile the presidential candidates are making their final push through new hampshire ahead of tomorrow's premare. larry kudlow had a chance to speak with a few of them and joins us now. what's the latest from the trail, larry? >>. >> we had a prety interesting interview with donald trump an hour ago. he and jeb bush are going at it, let's see if we can play a clip of jeb bush versus donald trump. >> if i've proposed a 45% across the board tariff on china, the man is crazy and donald trump does it, it's a sophisticated negotiating tool. >> jeb is not a very smart person, doesn't understand my plan. i'm not talking about 45 p. he made that up.
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i said that what china is doing to us with their devaluation is the equivalent of a 45% tax. we have to get china and other countries to behave because they are devaluing and absolutely killing us with our business. you see what's going on. >> well, there you have it. trump really on two passes with me denied he wants a 45% tafish and the negotiating card did come you will and he thinks that's exactly what it is. currency coordination is a very difficult thing to do. in some sense, that may not be a starter but we'll see. he and jeb are going at it. trump is the favorite to win tomorrow, on the other hand, jeb and kasich and others are rising and big battle for second place. >> do you see anybody trying to take advantage -- maybe that's not the way to characterize this, alluding to the market
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volatility and trying to turn that to their own advantage in the campaign? i haven't heard a lot of talk about the markets in this campaign to this point. why is that do you think? >> you're right. i asked donald trump about this an hour ago so the dow is off 350 and setd to them the stocks are down 350 points. he called it a big fat juicy bubble and he said we have a risk of recession particularly a jobs recession. and he basically said if the president trump confronted a recession, i'd slash business taxes for all companies big and small, his tax rate is the 15%. jeb bush also stressed a pro-growth approach. are they using the stock market for their own ends? i didn't hear that. it was more what to do about it if it continues. >> but it's an interesting point
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that the two states so far where we're talking about these contests, iowa and new hampshire, have unemployment rates near 3%. that might be why there's not a lot of questions kind of resonating with the specifics of where we are, even if they do vary broadly about the direction of the country. does that change? >> it may change because south carolina is not doing near as well. i don't think that is either. remember, it's sort of bothers me all of these debates and so forth. moderators should ask direct questions about economics and economic policy, it's the number one issue. you're quite right this is about new hampshire right now. the debates themselves are national events and the whole country, whole world is looking at them. >> the unemployment rate nationally at 4.8%. >> do you buy that or not? there are glitches in that number. i could poke some glitches in it too. >> is the campaign telling us there's something to that?
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they haven't come up telling us that the american public, whatever anxiety he feel, not manifesting in the day to day questions we would have heard eight years ago. >> i don't know. eight years ago, yeah. you look at any poll, kelly and economy is number one or include economy and jobs, number one. so i think there's a lot of economic anxiety. middle income folks have not done well and real medium incomes have fallen in this so-called recovery. i think that's where the anxiety comes from. you've got a lot of people that left the workforce and underemployment rate as you well know, close to 10%. so i want to see these candidates talk more about economic growth, taxes, regulations and entitlements and even the the currency. >> i know, but they are not doing it right now. was that out loud? i'm sorry.
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>> thankds, larry. >> let's get back to bob pisani. >> what's interesting, they have something in common. i've been talking about nike. they were $62 four or five days ago. it's down another 5%, 54. we had this kind of day on friday. other namgz that you would think would do well in this environment are having a hard time. they should do better in the low interest rate environment but raets are weak as well. a chart of facebook, 115 four or five days ago and just broke $100 today, 98 and change, bounced a little bit in the late afternoon. the stocks are down notably, starbucks another great corn assumer name with $61. trading around $54 today. you get the drift, the one thing
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all of the stocks have in common was that they were working very well towards the end of last year and sundayly have fallen apart essentially. this is a good sign if you're trying to find some kind of bottom. the stuff that was working well and all of a sudden everybody hates, this offer ten happens in the middle and towards the tail end of bear markets. the good stuff falls apart along with what they've been suspicious about for a long time like energy stocks. the supply of stock for sale is still pretty high and demand is pretty low. it's an interesting sign that we've got these big consumer names that are really rather poor in the last few days. >> we'll check back in a moment. >> keeping an eye on these markets, we're only down 1.3% on the dow. the nasdaq taking it toughest but we almost halved our losses from the lows of the session. >> we have 20 minutes left here in the trading day and final
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found the first trader with a smile on his face, cheslock, a lot of pain in the eyes as i reconnect. what did you say to me? >> this is my kind of market, what we expected for a long time. painful as it is, no one likes the market to go down 10%. he think a lot of times are coming to lighten people are trading on that. >> you're smiling because there are opportunities presenting themselves in your view, right? >> absolutely, one of your guests on a little while ago, said they were positive on banks for first time. that's an interesting sector and been beaten up pretty good. that maybe could see some signs of maybe when that turns, oil has been acting well today, some of the big oest has acted well. the vix is up almost 3 points, it's not broken out. it leds me to believe maybe things aren't as bad. >> do you give much credence to the vix right now. with all of the declines in the equity market, the vix is still
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holding in the 20 range, which is well below where it was last august. >> you would receive it would be 30 to 50 handle. >> exactly. >> is it broken? >> i think it might be a little broken but i don't think the fear factor is there. this is probably healthy. we're starting to see a big enough dip. 140-point rally in the dow in the last ten minutes, impressive. this is the kind of things we're looking for as a trader, you want to get involves with these and do it quickly. >> matt chesslock, starting to salivate a little bit. >> today's losses in the market are an extension of what we've been seeing since the year back. jan was the worst for the s&p s, down over 5%. look where the s&p 500 since the month of february began, already down 5%. what are investors betting on? we'll ask jj kinahan from td
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ameritrade, with the latest index. are people just panicky and running out all together or what's happening here? >> i think bill touched on it in the last segment. our index is down. what's interesting about it, our investors rotated out of higher volatility stocks to lower volatility stocks xd what we're hearing from our clients also rkts there sntd a sense of panic that you normally see with moves like this. this has been an orderly sell-off. if i had to sum up what our clients are doing, primarily going to names they know, apple, facebook and netflix and dividend paying stocks which was interesting also, like ford, verizon. things that are paying 5% or 4.5% dividends and at&t. they have not done as bad and as
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you see with the ten-year rate being at 1.78, you may see investors looking towards higher dividend paying stocks and u are seeing it with exxon and chevron. >> you played into a conversation we were having earl yerl with treasury yields as low as they are, you're going to have people racing to those dividend payers and you wonder if they are taking more risk than they real list when you've got some of these beaten down stocks that are paying four and five plus percent right now. >> that could be, bill, no doubt about it. the one thing i liked seeing and then going for like a ford, it's az low priced price type stock. it can go down but they are not going tore the 200 and $300 stocks, i guess they were harder to find than the beginning of the year also. last month was also a earnings month and lower volatility
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stocks and earnings they knew. if you think about when you think about six months ago they would go for more of the high flyers but people have battened down the hatches a little bit and still net buyers for the month. i find it interesting that the retail investor is getting smarter how they go for things and trying to sort out through all of the noise as you've done all day today, there is a lot of factors in there with china or the fed or whatever it may be. they are doing a good job of sorting through the noise to get to the time frames they want. >> i wonder, we talk so much about the sell-off and these momentum names and how overvalued they were. how overval with youed to some extent are dividend names everybody is deciding to pile into? i wonder in there's nor risk there simply because those too little a little stretched. >> as you talked about with the crude names, that will be interesting to watch them as crude continues to have its
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problems and if you look at the s&p 500 futures versus crude since the beginning of this year, there's been an 88% correlation. that's normally around 50 or 55. one of the interesting things to look at from retail views also, a lot happened overnight last month. and a lot of that happening with crude. it is interesting i'm standing here at the cme and how more retail is hedging positions overnight. we'll see how that continues to play forward because as you saw again last night, we have giants moves while equities aren't even open yet sfwl we've been pitting apple against alphabet as it's now known to see who's more valuable in the eyes of investors. how about for your clients? are they buying either one? >> apple has always a perennial favorite for a few reasons. people tend to love the product, retail traders do like apple, in one traded stock for last year
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again and continues ton a favorite of our clients. alphabet, it's a very, very high priced stock. if you teach people to be smart about allocation, that's a stock that could take up a big percentage of their portfolio. >> always good to see you. thanks. >> thanks, always a pleasure, guys, thank you. >> jj kinahan. as we sit here talking, the dow was down 400 points about 80 minutes ago, now down 154 points. >> you komg back from vacation everything lifts -- >> remember last i left and it was down and i came back it was the same level when i left. >> maybe it's not so funny. >> we're down 158 points. back to dominic dhu. >> it is staggering, down 400 points for the lows of the day.
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you refer to dow jones industrial average and i want to take this conversation around the dividend stock paying side. we want to focus on disney shares, falling 2% ahead of first quarter earnings reports after the closing bell. the company is expected to report a rise in sales and profits, helped by the release of "star wars" and the force awakens is the highest grossest release in the u.s. and third biggest in history. will it be momentum for committee? they'll focus on espn as well, dealing with a drop of subscribed numbers, down 10% over past year. bill, kelly, this is a dividend paying dow kpoern ent, versus underarmour and tesla, they pay 1.5% dividend yield.
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so dividend payer, media kmch, a git an, house of mouth tomorrow, back over to you. >> we have that to look forward to. thankds very much. this hour would not be complete if we did not look at our favorite indicator, the s&p sector. >> heat map please. >> i was just going to say that everything was negative but energy has turned positive and we know that chef rob andism on inside the dow have been two the positive tests inside the industrial average and that's contributing to that right there. >> if you're scratching your heads because we're talking about crude, it has rebounded a little bit but you heard jj say people want dividends and energy names offers, enticing ones. nearly 60% this year on reports of possible restructuring, triggered three circuit breaker
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and 93% still the company said it is not pursuing bankruptcy plans. let's get to morgan brennan with more on chesapeake and what other companies may be in trouble. >> people are wondering whether chesapeake would file for bankruptcy, that it retained kirkland and ellis. the gas producer saying a law firm served him since 2010 and chesapeake has no intentions to file bankruptcy and also seemed concerned about williams companies, both down more than 30%. 35 and 40%. williams is a major partner of chesapeake. fears of widespread bankruptcy is growing. a third could end up restructuring by mid 2017 if we see prices continue to stay this low. some names analysts are watching
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closely, lynn energy has shed 70%, saying its reviewing strategic alternatives to shore up its balance sheet. delisted from the new york stock exchange last month and houp can resources say they have no formal plan in place but it is reviewing options related tory instruct touring its own balance sheet. we're seeing the nrk sector turn positive here in the final moments of trading, names taking a beating. >>thy cut it on january 22, right? >> even if you're going after dividend payer, believing it's going to be a safer stock, that's not always the case. you need to be paying attention to the company itself as well. >> and you'll remember the shares initially responded positively on the news but look
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where we are today? >> exactly, chesapeake cut its preferred stock dividends last month. had it had cuts last year as well, seeing more and more names join the pile. conoco cult its dividend by two thirds, that's the reason we saw that sell off so steeply. it's also the reason when you look at a name like exxon-mobil compared to the rest of the sector maybe with the exception of the refiners that held up well and other producers and major oil companies, it held up relatively better because it has a strong balance sheet and if you are looking for a dividend within sector, it's the one most guaranteed. they have grown it for 33 straight years. >> thanks, a lot, morgan. >> let's check on the nasdaq, courtney regan, what's going on in times square? >> it's amazing, the movement we've seen here in the last 15
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minutes or less. we have halved our losses where we were sitting at the worst point of the session here at the nasdaq. by and plarnlg it is still a sea of red. we have 15 names or so in the nasdaq as i quickly look over at the screen. we were only about 42 points or so from bear market territory on the nasdaq composite, now we're about triple that distance and things have just steadily improved here. things getting better though those widely held mega cap stocks, facebook, amazon, google, still proving to be the largest point drag on the nasdaq and of course we know those names are very persuasive. we're seeing selling across the board, even though we pulled back on the is he verty, we're
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seeing weakness in software and weakness in areas like storage, that's western digital, sea gate, a number of those names weak. anything can happen here in the final minutes and i think i'll come back and wrap it up for you because things could change rapidly from what i planned to talk about. >> courtney, thank you very much. we've got about serve minutes left in the trading session with the dow down 18 points after having been down 400 points almost an hour and a half ago. joining us for the new york stock exchange, steven wood, chief market strategy. what do you make of all of this? >> this is the volatility we expected and redux of last summer, still the big three, still got the oil issue and china and the feds. i think we're seeing a redux of drivers of last year xbl what do we have to be watching out for in terms of whether this market moving lower. >> we go back to our base case scenario, we issued for 2016 we
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would not have a recession in the united states we're a little long in the tooth as you mentioned earlier. we still don't have a recession in the u.s. as the base case scenario, europe is beginning and economic cycle with the ease as well as japan. i don't think there's in change in the fundamental data that would knock us off the central case. where do you see volatility right now? >> you were talking about the bond market and more of the information we find ibting comes from the bond market and equity market. a lot of invefrters look at stock cash. if we looked at europe as having more opportunities than the united states right now. looking where you would dial down risk, assume risk, japan is the number two destination, globally and then looking a high yields from a sector specific
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and stock specific perspective what makes sense, valuations are probably 7 to 10% more attractive. what do we like sng. >> because there seems to be a fundamental gap. and macro view on things, for months been we like europe and japan and reality of the markets where european markets down 20 or 30%. so what is that disconnect? do you feel like this is just markets kinds of having a bit of a panic and working themselves up into a tizzi and nothing has changed or is there more of a disconnect? >> the macro view is part of that base case scenario that you work from. there's been a lot of volatility and look at sigle and i spoke to that, sentiment had volatile episodes but then look at valuations in the u.s. have been an issue for a year and a half plus. that's why a year that ago
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looking ats where they were less apressive. i think a lot of conversations we're having is where is risk now attractively priced. do we want to take it? we've got the multimanager situation and we're in fixed income space and currency space and one needs to look global and times like this you get paid for your discipline. >> you going anywhere? >> just -- >> you have another hour to get ready for. >> i swear -- on europe though, what do you do? just buy the dax, everything, the spreads are moving out again, the core is moving lower. >> we've got news and we've got greece, when it gets attractively priced, you want to be stock specific and european central bank will try to hit parity. in terms of a currency exportation and global trade, i
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think that's where you want to start. germany makes a lot of sense and france a bit but it needs to be stock specific in europe. bonds and equities. >> i'll leave you to it. >> and tossing it to you momentarily. >> always good to be back. >> can we move back a little bit? i think pisani will join us with three minutes left we haven't gotten the graphics in yet, but i want to see what the dow looks like today as we go into our closing countdown. we've come well off the lows, down 400 points, starting to lose the altitude. if you can give me the 10-year yield we hit 173 was the low i saw today. is that getting a little overdone do you think? the bond market? clearly people are running for cover and here we are 174. >> those are numbers wire looking at, psychological
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threshold of 2% and 1.9 and at these levels one would need to look at fixed income of getting very pricey, using that perhaps as a funding source of risk elsewhere, i think would be a very good analysis to have. >> one more oil, wti for a time below $30 a barrel, whether it settled and started to move higher we're back to $30.09. do you see any opportunity yet in energy? >> i see opportunity in energy and a lot comes in high yield space. where the opportunity is there, you've got to be very careful. the opportunity in oil may be the tail that comes through a lot of recognition happened in 2015 currently but the benefit to the consumers, this is a global tax cut. for europe and japan, this is unabashed benefit but it will take a while to go into consumer wages and spending. >> we had a pretty good come
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back for a while, starting to lose it. >> we were down more than 400 points and cut it in half. we were led by energy and suddenly beaten up energy stocks and conoco went positive, and it didn't rally. oil trades after 230 enand that doesn't mean -- you have globex training and the oil stocks rallied completely independently of oil. that was interesting and we had some of the broader market, the tech names all rallied and apple came rallied back and went into positive territory. i think we -- the only thing you can say about this rally today, we had an oversold bounce, i don't think there was anything more than that. i didn't see fundamentally, when you get the names down 15 to 16%, i've been mentioning nike and starbucks, and i think that's a sign the market has been oversold. >> very good. got to go. always good to see you u thank you for joining us, i've got more work for you to do as we go
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out with a decline of 180 points on the a well off the lows at 2:30 eastern time. mid stream partners ringing the closing bell and get ready for more earnings coming your way for the second hour of the closing bell. i'll see you tomorrow. welcome to "closing bell", what a session on wall street. a new week but return of the volatility, increase in it. dow was down 400 points but we're going out with a decline of 174. tells you a lot about the markets, bit more than 1%, s&p 500 down 26 and nasdaq down 79 points, 1.8%. we'll tell about some of the reasons why. we have john here with kayla.
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welcome, guys. fast money trader guy adami joins us and wells capital manager. appreciate the two of you being here as well. i'll start with you. what is really going on in the markets here do you think? >> i don't think anybody feels terribly good about the rally. we came off, we were down 3%, across the board and then we came back to this, down 200 points for the dow and 26 or so in the s&p. doesn't exactly feel good. people have said the vix is up but not that much. it's been an orderly sell-off and even energy is green today and why don't you think that that relief will be the theme. looked like will be down at least 400 and we could feel that wham to the downside. we didn't get it. instead the market drifted back
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up but the august 24th lows we just minded sat around bouncing back and forth of that level. it doesn't feel good. it feels we didn't flush. we had a very good chance like cam newton, we could have done something and we didn't. instead it's like we have to wait yet again just like cam. >> kayla, this market is like last night's game, best offense being a good defense. how many are file piling in and trying to buy energy with crude oil below 30 bucks a barrel and chesapeake having issues all morning. >> even though the yield was only a 2% yield. you think those aren't the dividends that should be ripe for a cut at that point. even the places would you think would be relatively safe, the dividends you would think because of the financial metrics would be relatively safe are not. i think the fact that the s&p has lost more points in just february alone than all of january means there's more
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sellers still at bay. people just expect that at some point the sentiment would shift and that we would have a few days of stabilization, that has not happened. >> guy adameny, where does that leave us? >> you had an eight-year market with an orderly rally. i don't know what an orderly -- i don't know what that means. to doc's point, i don't think you want an orderly sell-off because that by definition can last longer than people probably want it to last not to be all always negative all the time, ail say this, the rehearsal in conoco phillips, pretty interesting, exxon-mobil, 81 bucks -- it's middle of december. hard for me to say, i'm not really sure. maybe people are stretching for stocks that they feel have reasonable valuation and that
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the fact that maybe the oil for short-term is bottoming. i would push back and say exxon at 21 times forward earnings in this environment is not reasonable by any stretch of the imagination. i can't say what people are looking at. i can only tell you the price in those two stocks at least was halfway decent. >> mr. paulson, some are suggesting the reason we didn't get a flush out because on wednesday janet yellen speaks, is this creeping in and hoping the fed sounds much more dovish and do you think they are going to? >> i think that's part of what's going on. i'm hoping yellen doesn't show a lot of dovishness. one of the things good going on here, all of the sectors in the s&p that are at the epicenter of this crisis fied to energy and material stocks and emerging
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market stocks, they are out performing this year year to date. that's a good sign that what started this is starting -- >> the other sign is the stuff leading it up until last summer the last bash in this part, the technology and consumer discretionary are getting pounded and trailing big time. i think both to me tell me we're getting close to the bottom of this correction as we got new leadership emerging and old leadership finally getting pounded. >> that's a fair point. something certainly for people to keep an eye on other than the yellen testimony which will be wednesday. let's get down to bob, as we look at the tech stocks, there were differentation in the space today, a lot of people scratching their heads. >> jim has a good point about the new leadership and now old leadership is. put up the dow industrials, down as much as 400 points.
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what happened, there was nothing fundamental, a lot of oversold sectors kind of got bought a bit and that's the way you have to understand it right now. take a look at the sectors, all of these came off lows around 2:00 and consumer discretionary and energy had a nice comeback and the comment by exxon is absolutely right. it's been a stalwart and held up better than the other sector. it sort of led the markets to the upside just after 2:00 eastern time. but we had a lot of damage done, banks at new lows and every one of them are essentially at 52-week lows and even the trust banks like state street. i mentioned the old leadership getting pounded. i've been pounding away on starbucks and make nike in the last few days, they don't work well anymore.
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a few days ago it was as low as $52 today you can see the rally they had, it's nice to see but still a lot of damage done. same with nike, that stock also was in the 60s last week and you could see went as low as $54 today and modest comeback but still down 4%. one of the great winners last year, terrible performer so far this year and debate whether we're in a bear market or not. the s&p is only 14% from off of its historic highs but very large swaths of the market are there already, the transports, the energy, the bank stocks and material names all down more than 20%. kelly, about 6%, 20% off their highs let's not quibble too much. we're certainly very large swaths of the market are already in bear market territory. >> bob, thank you so much. bob pisani tallying up the day.
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after hours we're waiting on earnings and 21st century fox. let's get the details. >> earnings coming in in line with expectations at 44 cents adjusted per share. revenues missing estimates slightly, the company reporting $7.3 billion in quarterly revenue versus expectations of 7.51 billion. coming in a little light there. rupert murdoch and the executive chairman saying the cable business continued to drive the growth and they are encouraged by the television business they invested in higher number of new original series in support of the new prime time schedule. and looking at the different divisions, cable network programming and television, yielded higher revenues and studio yield is slightly lower than expected for quarter. back over to you. >> i kind of like that "grease
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production", impressive stuff what people can do live these days. we should mention by the way, as pr news wire acknowledging the coding wire led to results. john, between yelp which went back down 13% or after hours maybe 21st century fox, anything the market can hang its hat on? >> well, when i'm looking at why we bounced and so forth, i don't think the 50 cent bounce out of crude oil took us back. i think it was just severely oversold and we didn't get that. as we lift higher, you take a look how urp closed, down almost 4%, germany and france. that's when crude oil was just beneath 30. it made it just back over 30. you can't tell me that that is such a critical level right
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there that that's why we took back half of our losses. i think it was short covering and people taking profits off the table. >> getting specific on yelp, something you like in either one of those or would you steer clear? >> of the two i certainly like 21st century fox a lot better with the success on the distribution side with kyung if you pkung fu panda. i don't see a lot animation movies but jack black has had a winning hand in these series and it continues here. congratulations, jack. i think that 21st century has a lot of things going in the right direction which a lot of other companies don't. >> anything you would add to that specifically? >> i would say to doc's point, i'll say that the bond market held its bid all day long.
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i will say that disney tomorrow is going to be i think disney is really important, if you go back to the first time they sold off in august or so, the market followed two weeks later and subsequent rally, disney sells off again, market follows two weeks later. if you can get any stabilization whatsoever tomorrow in disney, maybe that's sort of alters well for the broader market. the fact that the bond market continues to rally and yields continue to go down, to me that the bank of japan has now completely lost control of the entire economy, that's scary things out there still. to doc's point, i don't think today my opinion was to capitulation that the market needed. >> one of the things is how much of a hit it would take and it's only 3 percentage points, $207 million, that's better than analysts expected and going
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against what we've seen from other companies citing the strengthening dollar in the most recent quarter and for a kbhp that has so much of its business abroad and all of its australian. >> we've seen up 25%, huge headwind for market and the dollar index is down to 996.5. >> i think a continuing advancing dollar will be a headwind for the economy and stock market. the fact that it's been coming off is good longer term here for the markets. ultimately, i think there is a catalyst here that will change what we've got going on. we've rach eted up negative sentiment and if we get any indication that the global economy and u.s. in particular is not headed for recession, then i think the markets across
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the globe are going to rally fairly hard. whether that's from here or slightly below 1800, i think we've got the stuff we need for a bottom and need a catalyst. i think it's going to be an economic catalyst. >> that would be a great sign which we very much would look forward to. meanwhile, let's update you on story we mentioned. 1:30 this afternoon, dom has more on what happened. >> we're getting acknowledgement that this is in fact what did really happen. pr news wire in a statement said that quote, we confirmed that earlier today pr newswire inadvertently distributed a quarterly earnings announcement from yelp before the designated time, caused by a coding error relating to the timing of the release. a rare occurrence and they successfully handle 350 releases a year. in this case here we did not meet the high standards for customer service and i am
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plimting steps to make sure it does not recur. so pr newswire acknowledging the fact it was their error for the middy reday release that typically comes after the closing bell. back to you. >> dom, thank you. this is a little more of a plain vanilla mistake. we see those try to mine the internet and that doesn't seem what was happening here. >> i think there is a certain competitive advantage if one of your rivals gets a hold of this before the market, they could see how market could potentially interpret that. they rely on the likes of pr newswire and business wire to decemb disseminate information. when it happened to twitter, you outsource because you think they have competencies you don't. if they don't, you need to search long and hard if you need
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to spend the money yourself to get it done. >> i mean, mistakes happen but it doesn't take away from the fact they released it at 1:30 or 4:05, it doesn't matter, it is what it is. if you're looking for a silver lining, the stock seems to have traded down to levels we last saw three years ago and talking about a stock where the short edge of 23%. maybe if nothing else in terms of yelp at least, maybe you got that capitulition bottom. >> any names in the energy space, we're watching like a hawk. this is where the stress seems to be emanating, out with the earnings, does look like a miss own bottom and top lines. so much negative has been priced in sometimes they can get a bounce on it. guy adami, thank you for joining us and jim paulson as well. >> be sure to check around for
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"fast money", a bigger call on high call growth stocks, and hear much more on today's's mega sell-off, european banks and tech stocks and we're a day away from the new hampshire primary tomorrow as candidates ramp up appeal to voters we'll head to the granite state to check in with tom brokaw and get his thoughts on things.
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another day, another brutal session for tech stocks. hi, courtney. we'll check back in with courtney in a moment. should we talk to the panel here? all right. we'll talk tech with the panel here. the interesting thing what we saw today guys, there have been times in the past where it felt like friday where all tech was carry out or parts of it were. anything you would add? the fang stocks were actually very strong throughout the day. i mean, when you looked at
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facebook, google and amazon and netflix, netflix actually held in very strong, mark cuban came out and said i bought a bunch of put protection because i'm scared and don't want to punt and get out of it right here. he set a floor on his risk. the nonfang stocks were getting killed. arm holders down 7%. micron down about the same. the tech stocks were getting hammered and they made some recoveries into the end of the day, but they weren't going from negative to positive. they were going from down 8% to down 4. >> kayla? >> what does it tell you about the market when a relatively strong performance means flat in alphab alphabet's case? xbl it tells you an awful lot, how weak things were in the nasdaq, which was down at one point 167 points. down around 4200 for the tech
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index and the iwm wasn't doing a lot better but both did bounce so -- >> those are real, whether it bounces or sells off, that's all real. >> i wonder for a lot of companies if they were to come out with a press release, we're not paying a 5% dividend or something. how would the market react? >> it would be a huge endorsement for those that could come out and say we can do that. i mean, and one of them you already spoke of at the top of the show, apple, certainly can do that at any time and has done that repeatedly. they've increased their dividend and share byback. it would be surprising to see ones i talked about, arm holdings and even ebay, for them to come out. those are the kind of stocks that could but arm holdings, micron, i don't know how they could. >> let's get more street favorites falling today. dominic chu joins us with a look at whether they are still
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beacons of hope in the sector. >> what's amazing about these stocks, first of all, like you said, they have been beacons of light for many investors and the argument is that facebook and google and larger mega cap stocks that have done well over the past 12 months and in 2015 alone have been pulling the market. let's first look at facebook, the f in the fang stocks group. if you look, off the worse levels today but still down 4%, that means so far again over the course of the past year, it's still up very a lot. they are up 33%, however, it's starting to show signs of weakness, maybe the momentum coming out of things and alphabet, google parent company, those shares as well, we did see them actually get back towards maybe taking a peek at positive territory flat for the day as people step d in towards the later part of the session.
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google has been a star performer but showing signs of weakness here is that a change in momentum, a signal perhaps, a canary in the coal mine? and another one cloud software related stocks and in this case one of the biggest of them all, salesforce.com. so far lost a third of its value over the course of the past year now negative. now many of these cloud computer stocks were seen as reelgly high growth momentum type plays to the upside, so they were very positive generally speaking in 2015, however now they are showing signs of weakness. when you take all of these in focus and say if these types of stocks leading the way higher and showing signs of weakness, can any rally be sustained? after all, they were the ones that powered the rally in 2015. it's a big question for many investors out there. >> it's amazing to see salesforce stock doing what it
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has. courtney reagan has more. >> good afternoon. just as you saw down at the stock exchange we saw here at the nasdaq, losses were halved in the final 30 minutes or so. nasdaq still the weakest of the major indexes closing down more than 1.8% but better than what we had seen earlier in the session, only 40 points from a bear market low we are actually quite a bit past that. as dom was mentioning, a bunch of the cloud computer stocks were sort of the reason that the sell-off began. it actually began a bit on friday when it cut its 2016 revenue forecast. many of the competing stocks also fell but it wasn't just a cloud computing names it was soft name names, they shed significant value in the session even after recovering just a little bit and the nasdaq biotech index, this etf that we check a lot still had a very
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rough session, down more than 3%. this is again in bear market territory down more than 25% in two months' time. kelly, back to you. >> courtney, thank you. >> we have a news alert on gap to get to. sue herrera joins us. >> the gap stock is moving in afterhours trading because they reported their comparable same store sales for january of 2016. this year we're down 8%. now that may seem like a big hit but it's kmared to a negative 3% last year. comparable sales for the 2016, gap global was negative 6% versus negative 9% last year. in addition to that, the guidance that the company is issuing for the upcoming quarter is better than expected towards the higher end of what the street was expecting and as a result you can see the stock is up better than 1.25%. >> we were just talking about how this information gets out
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there but gap shares a little higher. anything you would add? >> pretty thin gruel, as sue said, same store sales down 8%. if you compare them year over year, okay, the fact it was down a full three points last year, that's the thin gruel i'm talking about. same store sales dropping off like this, i don't know who is getting excited and the revenue numbers missing, even though the guidance was decent, crystal ball is not there for gap stores. >> although it is a multiyear turnaround and there are going to be some hurdles that come with that. how much time do you get a company like gap? >> change their name to old navy. gap stores is not where me make their money or anything else. old navy is when they make money. >> given all of the market turmoil, is a march rate hike on
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yet. here is the march to march or going down the road feeling bad. we begin this week with the yellen testimony. i think she's not going to rule it out. she has to maintain her option to really do something. probably suggest lesson the table than we thought but won't rule it out. another big sign post here, inflation numbers february 19th, if they show stable or rising core inflation, that would put it back on the table. next sign post here, the jobs report march 4th, let's say we go down from 4.9 to 4.8 on the unemployment rate and we have another steady wage gain that will increase pressure on the fed that meets march 15th to hike another big factor here is the ecb decision march 10th. they are expected to take additional easing pressure, that will probably make it harder for the fed to hike. markets and china have to show some stability and all of that leads up here to the march 15th
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to 16th fed meeting. the market priced it out kelly, economists have not because of what happened on friday, declining unemployment rate and rising wages has to make the fed think they have work to do becauses what's going to happen in the economy. >> markets hit hard, could the financial stock moves spark more central bank action? let's ask steve whiting at citi private bank. good to see you. you just heard what steve liesman was saying about the jobs report and low unemployment rate. do you think the fed will continue to raise interest rates from here? >> i think a lot has to go right for the federal reserve to be back in its comfort zone the way they were in december. back in september we had stronger economic data than these recent releases away from perhaps the wage data, that one single point. but uncertainties in financial
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markets did weigh on the outlook in a way that sidelined them. the fed could come back to its comfort zone before the year is over. i think that markets are overshooting on a lot of fears of potential shocks that won't necessarily materialize. but it's a road from here to get there in march. >> steven, how much credit do we give the wage data? in january you have 14 states that raise minimum wage and -- >> these could be discreet impacts, when you average december and january employment data, the gains in employment across industries were still quite strong. there was no big deterioration in labor markets. there has been an inventory correction and weak exports affecting manufacturing. there are these signs that are off a little bit from peak levels, but i think the fed is much more worried about forward
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looking conditions to threaten recovery. and in order to reign in the strength in the labor market. janet yellen said they could tolerate an overshoot in labor markets for a good period of time when inflation is low. >> i wonder how much these markets are -- how much they priced out the possibility of a rate hike at this point. >> i believe that the markets are completely unbelieving that the fed can even move at any point this year right now. you look at the fed funds or if you choose not to, you can look at the credit default swaps and how they are flaring up. you look at the likely move that steve liesman talked about the ecb and draghi. and the fact that you don't really want the dollar to go back ripping to the upside. i can't believe that they would look at all of that data and say, because of one wage report, that that gives them room to be able to make another rate increase. >> it will be so interesting to hear from janet yellen, labor
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economist, come wednesday. thanks for joining us. >> thank you. >> shares of twitter plummeting 69% over the past year. social media company expecting to name two new people to its board when it reports earnings this wednesday. will that be enough to gain confidence back? we'll talk about that next. tomorrow is the new hampshire primary and nbc news special correspondent tom brokaw is in the granite state and will join us later with his thoughts when "closing bell" comes back.
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welcome back, at one point the dow was down 400 points. we finished down 178 and nasdaq down 79. it was the worst performer falling another 1.8%. twitter sales also fell sharply today as we await the earnings report from the company on wednesday and twitter users were in a frenzy using the #riptwitter after a report suggesting the company could use a rhythmic timeline, hello twitter, i want you to know we're always listening. we never plan to reorder time
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lines next week. curt wagner joins us. there's been a lot of discussion how twitter can maintain its current user base let alone grow it. do you think that it seems like jack dorsey with this rip twitter thing, this a sign of broader troubles or a lot of the concern of the stock already based in. >> when you see him and other employees of the company kind of coming out and trying to respond to what users are complaining about really loudly on the service, it shows they are a little worried and concerned that the product changes they have in place, whether it be expanding the character limit up to 10,000 characteristics or changing the timeline, these are dramatic changes for people using twitter a long time, trying to do something dramatic, they have to. and when you see jack come out and say this, i think it shows some concern. they want users to be happy with the changes and right now they are not. >> it draws a stark contrast to
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the way facebook goes about its changes, it's able to overlook the initial backlash from users. do you think twitter lost that ability? >> well, i think that what facebook has going for it is that it has the wall street side of things shored up. it had earnings last week and totally crushed earnings and stock price went through the roof. when you have that side of your business really cemented in, you don't have to worry so much about going and making a bold change and kind of dealing with that backlash and giving it time to play out. twitter doesn't have the luxury of time right now. people are expecting change to happen immediately and for whatever they choose to do, they want it to work right now. when you don't have the luxury of time, that's the difference i think between facebook and twitter at the moment. >> are you a buyer of twitter at these levels? >> i like twitter and i'm sure the gentleman from recode would agree, part of the problem is it's so specific right now,
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whereas facebook as you spoke to is the public in general, globally. twitter loses that because people don't understand following people and/or blocking people and things they need to do to actually use it effectively. but with facebook, much easier. if twitter can focus in on that and bring the public in, that's where they need to be able to grow. they have got the pros and folks in the media and/or mining data, now they need the public back involved and the public is confused. >> it's going to be a tough one for them. we'll see if we get more clarity on wednesday. thank you. cart wagner. nbc universal is an investor in recode's parent company. strong poll numbers carry on primary victories tomorrow? tom brokaw joins us live from
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the granite state next.
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tom brokaw has seen all of the win ares and losers, the granite state has to offer. former anchor of "nightly news" joins us from manchester new hampshire to size up tomorrow's vote. it's an honor you're joining us
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on the program. what do you think? is it going to be sanders and trump making history? >> new hampshire always manages to surprise us going all the way back. you're way too young to remember this, gene mccarthy ran a strong second and that forced lyndon johnson out of the white house in 1968. i remember as well george bush 41 defeated a favorite son in iowa by the name of ronald reagan and thought coming into home territory in new hampshire he would be okay. reagan beat him here and of course went on to a historic place in the american presidency. and then you'll remember just eight years ago hillary clinton was beaten by fresh face obama in iowa, came into new hampshire thinking he was going to be on a roll. hillary got kind of weepy, a lot of sympathy for her. and what people overlook in the state, women are very often very powerful. the governor and two senators in new hampshire at the moment are all women. so new hampshire always
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surprises us in one fashion or another. >> i think the journal pointed out some of those women are actually more leaning towards bernie sanders than they were in iowa where it was more down the gender line in terms of the vote. it is his neighboring state but broadly speaking, what would it say if bernie sanders pulls off a win there tomorrow? >> well, i think some of it would be discounted because of the regional piece of it, he is right next door. he's been a familiar figure here for a long time. but new hampshire like iowa, really has no reason to be very angry. the unemployment rate here is below 3.5% as it was in iowa. the state is doing quite well. but for a lot of reasons across this country, folks are just very unhappy with the current state of the government. on the right and left for different reasons. and on the left in bernie sanders' case they think it's time obviously if they are following him, that they've got to shake things up and kind of social compact way.
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>> and by the way, speaking of regional politics, michael bloomberg has just told the financial times" that he's look at all options in response to the question of whether he would run for u.s. president saying i find a level of discourse in discussion an outrage and insult to voters, saying he would need to work to get on ballots at the beginning of march. i say that because he's a well known name here in new york but could michael bloomberg do this and pull off a national campaign? do you think he should? >> well, in a certain amount, stratosphere across america and big business and people who are republicans and know mike bloomberg because of his name in business and running new york city so well, they are inclined to them. once you get past the hudson river he's not that well known and he is a new york stay mayor. nonetheless he speaks to both sides of the political spectrum. i know him pretty well and i do
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know that mike and the people around him are fully aware of just what a long hard slog it would be to run as an independent. he will make a decision sometime by march. that will depend as well on where these two races are. who's at the top. then mike will make the decision. ross perot got in early and only got 19% of the vote. >> jeb bush has spent a lot of money too, it's so fascinating for all of the concern about money and politics, his $100 million as donald trump likes to point out hasn't gotten him that much. is trump going to pull off a win tomorrow? how does that change the equation do you think? >> one of the reasons new hampshire doesn't want to give up the first in the nation primary is that it is an infusion of $100 million into this economy. i think that the money angle of presidential politics is sometimes overstated. mitt romney had all of the money he wanted in the world once he got the nomination but he still
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couldn't beat barack obama. there are episodes all across the country in state and senate races in which the person who doesn't necessarily have the most money touches the nerve that gets them into office. >> and that's why we look at the fact that the front-runner in new hampshire and perhaps beyond remains donald trump, even though ted cruz won iowa and people are asking themselves, is this going to be the gop's presidential candidate, a goo who has g guy who has gotten tons of media coverage, using his own money. if we ends up having a trump and maybe hillary clinton, do you think tom brokaw, that michael bloomberg will get in the race or is he upset enough he's willing to get in the fray? >> that's way too far down the road for either you or me to get involved with at this point. it might be helpful if we find out what happened in new hampshire tomorrow, then we'll have in a slightly better place
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to project the future but we have south carolina and nevada and a lot of other states to go. i always remind people, take a deep breath. this is a process that we have in place and everybody should wait until the votes are counted. >> what do you think by the way before rewe let you go, the number one issue for people you're speaking to in new hampshire? >> i think it's true across the country, they are ticked off at the government, ticked off at regulations they don't think work for them. they are not happy what's going on in the war. social media has a big impact on their unhappiness. they are told every day they ought not to be unhappy because of immigration. immigration is not just a matter of people coming across our borders, it's a cultural and racial issue as well. i think things are not working out as this generation had hoped they would. and american dream has always been that the next generation will live better than the past generation. well, we may have reached aid ceiling in terms of real property, income and kinds of
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jobs that you have. then you have to look is the american dream about values more than it is about things? these are some of the issues involved this year. >> so well said. we would expect nothing less. thanks for joiningbrokaw, thank us. >> my pleasure. glad to be hear. >> tom brokaw joining us from new hampshire on the eve their primary. president obama asking congress for emergency funding to help fight zika. up next, what the additional $2 billion will mean for fighting the mosquito-borne virus. when we come back. baas
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with a single click. then simply select the best candidates from one easy to review list. and now you can use zip recruiter for free. go to ziprecruiter.com. welcome back. the cdc saying at 50 cases of zika have been diagnosed among american travelers. pope massachusetts asked congress for $1.8 billion in emergency fighting now to help fight it. meg terrell with details on how this may help. >> reporter: this includes a lot of money going to cdc for better surveillance and control of mosquitos. if you look at the breakdown of funding, is bulk is really to the department of health and human services which oversees cdc as well as cms, and so what they are trying to do here is really make sure they are doing everything they can to control the mosquito that spreads this virus. they are going to be giving a lot more support to those efforts. they are also going to be constructing the sort of rapid response teams. this is a phrase we heard during
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ebola so if we do have little clusters here in the united states, because, as you mentioned, we have had 50 cases coming into the u.s. they will be able to respond very, very quickly. there also separately will be money allocated to developing a vaccine and better tests for zika. this is incredibly important. we obvious lire don't have a vaccine or any treatment right now so they are really trying to accelerate that effort and they are accelerating money to preaka because they have active transmission there and giving maybe $250 million set up in their medicaid assistance to help pregnant women with medical costs. >> so many different avenues that it seems like you have to work on. one especially in brazil seems to be in a sense public cleanliness or maybe it's one of the california mayors we heard the other day saying make sure we don't have any standing water and that the is off thing. will any of that fund going towards basics or is it focused on more high level -- >> going to the basics. learning more about mosquito control and how these diseases are spread.
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mosquitos can breed in a bottle cap full of water so that's the challenge is really trying to make sure you're eliminating the areas where mosquitos can breed. i think we're showing cdc footage here. just put out a statement saying they moved their emergency operation center to the highest level of zika response and this is come to a response urging the president to get on top of this. some calling for a zika czar, the same way we saw an ebola czar to coordinate all the agencies together. >> especially heading into the summer here, i'm sure the concern will grow. see if this can at least help get in front of it. >> our meg terrell with more on zika. a busy week for earnings already. 20-9-century fox kicking off big media names. a look ahead to viacom and disney right now. we'll be right back. thanks. ♪ [ male announcer ] fedex® has solutions to enable global commerce that can help your company grow steadily and quickly.
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great job. (mandarin) ♪ cut it out. >>see you tomorrow. ♪
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tomorrow, big week for media. earnings, shake-ups, power struggles. as the pressure heat up, who is feeling the magic now? "squawk alley" 11:00 a.m. eastern cnbc. welcome back. 21st century fox is moving lower in the after hours report. more from julia boorstin >> reporter: company's guidance sending the stock lower in after hours trading and the company expecting its earnings for fiscal 2016, they just reported a second quarter in fiscal 2016
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expecting full-year earnings to be flat, up low single digit. the prior guidance was for mid-single digit growth and they say it's because speaks of foreign exchange headwinds and the fact that the film stuldio has not performed as well as expected despite the success of "the martian." >> thanks, julia. more big names this week, disney and then move into the twitter and tesla phase. john, what will you be watching for? >> disney is huge because of the cord-cutting that they have talked about and because espn is such a revenue driver for them. i wouldn't be giving up on disney yet, but i do think a lot of folks will be patient and rather than jumping in ahead because of some of the volatility we've seen in the market, they will try to pick it up on a dip. >> yeah. >> so that might mean that people like that and people like me will chase it rather than be in early. >> and bracing for a lot of "star wars" puns in the head loins following disney earnings. >> the hasbro stuff was great about that though because hasbro
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indicated strong disney draw and that's why the toys were so strong. >> see if it translates into disney shares. >> thanks for joining me. jon najarian and kayla tausche. does it for us today. with another down day in the market, well off the lows is all we can say. "fast money" begins right now. live from the nasdaq market site overlocking new york city's times square. i'm legal is a lee. tonight on "fast" the man who called the august swoon, jpmorgan's head of quantitative strategies is here with a bigger call about high-growth tech stocks and it's nod good and citigroup says we're in the midst of a, quote, death spiral, and nothing we can do about it. the man who pen that had report is here to tell us what has him worried. the commodities king dennis gartman says something has changed about the

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