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tv   Closing Bell  CNBC  August 8, 2016 3:00pm-5:01pm EDT

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>> bad timing. building a giant new headquarters building and almost done. spectacular and probably not the time for a brand new building. >> definitely stocks to watch. thank you for watching us here. >> "closing bell" starts right now. welcome to "the closing bell." i'm kayla tausche at the new york stock exchange. afternoon to you. >> good afternoon to you, as well. welcome abore. i'm bill griffeth. walmart looks to give the e-commerce business a jolt. we have new comments of walmart ceo in a moment here. >> and tesla under pressure as the automaker discloses it will need more than a billion dollars in cash for the third quarter. we'll look at how the company is spending its money after just having to issue stock. >> a nightmare for travelers today. delta delays. the company's computer system is
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back online now but many flights are still not up and running. hours after they were scheduled for takeoff or landing. we'll take you live to laguardia in new york city for the latest details. and just earlier today, republican nominee donald trump gave a major economic speech with new details of his plan. we've got trump economic adviser and real estate mogul howard lorber coming up. let's start with that breaking news on walmart. courtney reagan with the new comments from the company's ceo about the deal to acquire court? >> that's right. doug mcmillan spoke about the $3.3 million acquisition. largest private e-commerce acquisition and with the brands distinct, mcmillan said wart mart wants to be thoughtful of how to combine the businesses happening over time. >> as jet scales, they will have resources available to them as a team and the brand they didn't
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have before, and at the same time, we can leverage the talent of the organization, combine it with what we already have, deploy some of the customer facing and back end components that jet's built into the platform which will enable us to be successful as >> he says marc lore will lead both and when the deal closes. walmart is also not updating any guidance at this point. now, nearly everyone i've spoken to believes it's likely about lore and the senior team. one of the brightest minds in e-commerce and walmart lost him once and walmart reportedly out bid by amazon for qidzi in 2010. he's not happy with walmart's slowing growth rate and far behind amazon. wall administrator's total online sales less than one sixth of amazons and churning out weekly innovations like the king
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of the online jungle does to be a viable alternative. jet hasn't given a total customer number but the site's consumers tend to be urban, millennial and likely incomes greater than $150,000. only a fifth of buyers have also purchased from in the most recent six-month period and could be some value there, of course. but there's still a lot of questions. how will help if they remain distinct even for a period of time? back to you guys. >> they're not going to be integrating it right away. >> exactly. >> what might be the reason for that? why are they paying $3.3 billion for this key man and then not sbe grading the company? >> so doug mcmillon held a town hall with associates today and where we believe he held the call from and he said it has to
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do with the technology platforms and want to be careful and thoughtful about how they integrate the two and sounds like walmart needs to take some time to understand what can offer. how that system works. before it just goes into what it has in sort of mixes it all up. but there was no time line given for exactly when that full integration will happen. mcmillon said customers won't really notice anything for some time and about winning in the long run, not right now. >> very interesting, courtney. thank you. walmart's ceo will be on "squawk box" tomorrow morning at 7:00 a.m. eastern time. >> just points to how sophisticated e-commerce is these days and evolved from a website and selling your stuff. >> very scientific. perhaps more science than art these days. >> that's for sure. all right. let's move on to the "closing bell" exchange today with the dow down 35. again, we are back to a very
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narrowly traded market again. joe duran with us and jack and steve grasso is somewhere on the floor of new york stock exchange. steve, you know, you get one rally after the good jobs number on friday and back to the summer doldrums again. when's really moving the market or not right now? >> i think we are in the summer doldrums, bill, regardless of whether we rally or not but the problem the market for the bears haven't been able to keep it down and i news that term flat is the new down. we are down one or two handles. bears get excited and rolled over the next day and rally 1%. bulls are trying to convince everybody recent retail sales, stimulus coming down the pike of boj, the fed, we don't know where they're going to be on one side or the other. you have to stay on your toes and you got to be a buyer of this market. people don't want to buy the highs. they don't want their picture taken.
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we're on a retracement level 2185 in the s&p cash to 2200 is the last leg of retracement where it should fool a lot of people and hopefully we don't hurt too many people screaming higher from here on the short side. >> you don't seem to mind having your mug on camera too much. moving on to joe. a quick question for you because a lot has been made of the broad based strength of the rally just on friday we had financials enter positive territory for the year. does that signal to you that a rising tide will continue lifting all boats or now every sector is perhaps getting very rich because financials were one of the spots people said that's really where you see a buying opportunity because it's the only one that hadn't been positive? >> yeah. everything's been doing very well. and i like to think that the market does the opposite of what most people are feeling and i don't get a sense that people are overly optimistic. in fact, all i hear are people telling me why the market is
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overpriced and the market does not go down when people want it to go down. it goes down when everybody is incredibly optimistic. we're not seeing that. i think you might see a surprisingly strong end of the year. the fed appears to be out of the way. we're seeing i think signs that the economy's doing a little better. and we might have our very long protracted maybe ten or 11-year recovery without a 15% drop which would be unheard of but we're also seeing the slowest recovery and therefore might last longer than anyone expects and the rotation we are seeing going everywhere is a bullish sign. getting narrow as it had been that would be a problem. i'm seeing reasons to be more optimistic. so many are pessimistic. >> jack, how do you read the market's mood after friday's jobs report? seems like people are anxious to get the next rate increase out of way here.
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but yet, they still feel like it's not going to happen. you know, they have been led to believe it was going to happen too many times and then it didn't happen. what do you think is going on with the fed right now, even as job growth continues and inflation's holding steady and, you know, kind of bumping along here. >> well, a lot of it has to do with the fed with other central banks is losing control of the markets and reacting to the markets opposed to setting policy and being proactive except for the bank of england. i think you have squeezed people into the market. remember, this is a market that did not look good in february and march and then the cash on the sidelines had nowhere to go. so when you have people buying and call it tina. whatever you want to call it. the reality is buying stocks as if they're buying bonds. there's a lot of complacency out
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there. i'll disagree with the other guest not seeing optimism. seeing the vix under 12, seeing the weekly vix pushing 7, that tells me there's absolutely no fear in this marketplace and that is something to worry about. >> joe, quick comment from you on the vix and whether that's giving us a leading indicator we should be paying closer to attention to? >> look. we are seasonally in a dangerous time. definitely overdue for a 5% to 8% correction. i see that we're very quick. we'll take vix to 30 or 40 at the slightest hint of a decline and then the fed steps in and we're seeing a broad recovery here in the stock market. and so, again, if it were very narrow, i would be concerned. if there wasn't such quick reaction in vix, what you will see, i think, a modest pullback. snap back on the vix quickly and everyone will say the world is ending and the market will recover again. we've seen the pattern over and over again for seven and a half years. >> we'll go at this point, guys.
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thank you very much. appreciate it. see you guys latter. and now to donald trump's economic policy speech in detroit. john harwood has our key takeaways. john? >> reporter: hey, you know, the main criticism of donald trump's economic plan has been the $10 trillion that it would add to the deficit. donald trump's never acknowledged that criticism directly but he did indirectly with this passage in the economic speech here in detroit today. >> we will work with house republicans on this plan using the same brackets they have proposed. 12%, 25% and 33%. >> reporter: now, let's recap what exactly that means. the old plan he announced last september had three rates. aside from the zero rate for low income people. 10%, 20% and 25%. now look at the rates. 12%, 25% and 33%. that is to limit the deficit
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impact. his aides did not give a cost estimate for how much it would reduce the impact on the deficit and proposed something else in the opposite direction which is to make deductible the average cost of child care for any family claiming it. still no details on that. now, in terms of his performance, donald trump stayed on message. he was disciplined. didn't allow himself to be distracted by protesters who staged coordinated attempts to disrupt the speech but have to note that trump said one thing about hillary clinton flat-out false. he said that in a recent speech she declared to the audience that she is going to raise middle class taxes. actually, hillary clinton said we are not going to raise middle class taxes. so it is -- need to clarify that, guys. >> all right. very good. we'll hear from her on thursday speaking to the same group there. john harwood, thanks very much. joining us right now is howard
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lorber, a member of mr. trump's economic advisory council unveiled on friday and ceo of vector group and robert frank joins the conversation, as well. howard, i happen to notice you have a master's degree in tax xi taxation. why a tax rate? is it mindful of what the impact would be on the deficit, on the debt out there? or is it as much trying to make nice with paul ryan and the house republicans? >> no. i think it's being realistic as to not create such a big deficit. we all know why we need tax decreases. 1%, 1.25% anemic economy and these will still be probably the biggest tax decrease since the reagan era and we need it. >> howard, you are on the economic advisory council. you have known trump for 30 years. i have no doubt that this group
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has great people on it. will he listen to the advice? does he listen to people who give him advice? >> i have always found that donald, you could tell donald anything. he will listen. that doesn't necessarily mean he will agree and do it. but he listens. he listens, he filters the information. he'll ask you more questions. >> what about today's plan did you suggest, support, add to the chorus about? what's important to you? >> what's important to me is getting the economy going again. being in the businesses that we're in, including real estate. if you don't have employment, if you have lower, you lower rates of unemployment, true unemployment, how could people buy houses? how can the economy grow? and i think the number one way is the tax -- attacking the taxes. with lower rates, you can have more spendable income. people buy more houses, spurs
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the economy into a much higher growth pattern. >> when he unveiled the economic team last week he said there will be more people added over the course of time and critics suggested it could benefit from more diversity of thought, perhaps women, do you see a need for that? >> i don't -- look. i think you should pick the best people and dent imply there are not women well qualified and my guess is there will be women involved. looking at donald and his life, one of the people he goes to all the time for advice is ivanka. he surely doesn't have a problem with asking women for advice. so i'm sure they'll find a couple of people and i would not be surprised if they were women. >> what about economists? what about people who have hands on experience being in the middle class, for instance? >> you know, i think that's fine. i think what he doesn't want is politicians. what he doesn't want is people been in washington for years, whether they were economists, advisers. you know? to the presidents as economists. he wants people that have built
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businesses, know what it's all about to struggle in hard times and know what's needed to grow a business and then grows the economy. this ian the people he wants. >> you know, we talk about the tax rates for taxpayers and for corporations to lower that -- that corporate tax rate even more. is the point of view to jumpstart the economy, grow the economy more, even though unemployment as measured by the government is at 4.9%, is it to get government -- get corporations to want to spend money again and build factories and do other things that they would normally do? >> well, of course. that's one of the reasons, obviously. it is not much different than lowering an individual tax rate and have more spendable money. if you lower corporate tax rate, they have more money and spurs the economy. >> there's a theory out there we are in a period of secular stagnation right now that no matter what is done, look at the
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monetary policy and fiscal spending around the world and we have growth rates well below the national norm. what is going on here? >> all that proves is what is done by the politicians recently hasn't worked. that's what it proves and time to try something different. look. i think there was 240 new important regulations adopted during obama's term. no one knows what most of them are but we know they cost a lot of money. all sorts of numbers but it was a lot of money. also, as relates to comparison with clinton's -- with hillary clinton's tax plan, that's going to cost about $1.3 trillion over next 10 years of increased taxes. so what does that do? that just means the growth will be even lower. >> howard, you run one of the largest real estate firms. what happens to the cap now a million dollars under the trump plan? >> you know, i'm not sure about
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all the details yet. >> will they limit it for rich people? >> i don't think so. and i think it will probably stay about what it is now. i think getting rid of it, million dollars, is going to hurt middle class. a lot. so i don't think they get rid of it and it will be there. quite honestly, if the decision was made to eliminate the reduction for the well think, that wouldn't make that much of a difference. the lower tax rate will. >> right now the high-end real estate world is the softest part of the market. is trump good for that? bad for that? what do you think happens in a trump presidency to the real estate market especially the high end? >> first of all, we are in all ends of the real estate market because the markets we're in. >> right. >> many of the sub you ares did not recover to the highs pre-recession. still down quite a bit and, yes, also in the high end. look. it's easier for the high end to go lower than the low end to go lower. a fact of life.
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so i think that if you price -- >> but how does he help -- if he will help the real estate market, how does the plan do that? >> simply. lower taxes. more spendable income. when's important to them, where they live is important. >> higher taxes for the well think under clinton and yet that was a very good economic time. >> well, it was a good economic time for certain people. not great economic time for everyone. i think this tax plan will be a better economic time because, again, let's get going. when's important? jobs. if you don't create jobs, and his plan is to create jobs, unleash the economy and create jobs, create jobs will help everyone and help the economy. >> what about looking to the globalized economy? i mean, he is not mincing words on trade whatsoever. wants to renegotiate nafta, walk away from tpp and label china a currency manipulator. how do you see our relationships with other of the world's largest economies developing when tariffs go up, companies
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are forced to make very hard decisions? >> well, look. i think what donald wants, my conversations, he's not against trade and trade agraemts. we wants fair trade. very simple. maybe not completely free trade but fair trade. the deals to be fair for both sides. he is a negotiator, a deal guy. only a deal person knows how to try to get there. not just give in and not play hardball so the other people walk away from the table. donald will be the type to engage him or through the people with him in the government will be there at a negotiating table and i guarantee you they will be making deals and not breaking deals and walking away. >> thank you for stopping by. >> my pleasure. >> a member of donald trump's economic policy council here at the new york stock exchange. robert, thank you, as well. >> thanks. >> enjoy the rest of your vacation. >> i will. >> see you later. 40 minutes left in the trading session with the dow down 32. another narrowly traded day on wall street. >> with a fresh record for the
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s&p. when we come back, the fallout of delta airlines. outa outage this morning. also coming up, another bump in the road for tesla. elon musk electric automaker say it is factory may cost more and cost more to build than thought. we'll weigh in on the possible setback for the company coming up.
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all right. what a day for delta airlines. the stock has come back today. they're working to get all the flights back up in the air after the global computer system outage led to wide scale cancelations overnight and delays this morning. check-in systems, airport screens and the airline's
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website and smartphone apps were affected. airport agents had to write out the boarding passes by hand and back to the -- all the way back to the 20th century. >> vintage. >> delta says some flights resumed but delays and cancelations are still ongoing. >> here we thought summer thunderstorms were the biggest headache. >> or tsa. tesla shares under renewed pressure as the company reveals $1.1 billion in cash requirements for the third quarter. tesla finishing the gig ga factory and plans to buy solar city for $2.6 billion in stock. >> joining us is ephraim levy. we saw the massive stock raise in may. perhaps now it's clear why they needed to do that. are they going to have to do that again? >> i think they'll go back to the market once again as you
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indicated. they have near term cash needs including second half development of the giga factory. if the deal for solar city goes through that's dillutive. >> do you think he's just bitten off more than he can chew? we know how ambitious elon musk is and can-do kind of guy and trying to do too much at the same time, isn't he? >> that's part of the m.o. aggressive with the deadlines, the technology. that's part of something that you have to factor in to any thesis for investment. but, you know, it is not something that wall street likes. we prefer certainty. >> does the solarcity deal ease any capital concerns or exacerbate them? >> exacerbates it. in terms of an investor in tesla, i look negatively on it. you know, whether the long materiterm it makes sense, synergies, may be true but coming to the two
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companies by the purchase price and the fact they're cash flow negative that's a distraction for the company management as well as cash flow needs. >> did you ever like tesla? i'm curious. that's a time there's a huge momentum player. right? obviously in the market. everybody would jump in, on the elon musk bandwagon and different story these days and curious of a time you liked the company or have you always been skeptical of his strategy and his ambitiouses. >> well, from a technological perspective and from the dynamic of changing the industry which he does, i've been a fan of him. as far as from the investment perspective, i started off my coverage with the sell a few years ago and gone between sell and hold because i'm always concerned about the valuation of the stock and the investors, the people in the stock give a battle between the bulls and the bears. the big fans that are buy at any price. however, i tend to be more conservative and i see the risk there.
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and, therefore, i've gone from the hold and sell back and forth. >> you know, this stock, though, and solarcity for that matter, too, have come with buyer beware tags on them and people that bought them believed they were buying a story that's not going to pay off five, ten years or until five, ten years down the line. is that case still intact here despite near-term concerns? >> well, the bulls have the case that they expect when you hit the mass market product for tesla, model 3 to become profitable and cash flow positive and that's the basis of their thesis and several years out and a lot of risk there. we see them continuing to be cash flow negative probably into -- through 2018 and maybe turning positive in 2019. >> what do you think, does he -- will he hit his target date to bring the model 3s to the market? >> i wouldn't bet on it. >> when do you think it's more reasonable? >> the pattern is probably like
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six to 12 months later or longer. not as much as whether he gets there on time but the point he gets there and what i think he can do that. i think he will have an attractive product. people willing to put down sizable number of deposits including $1,000 with it. but, you know, it is still way out i won't pay this much up front. >> good to see you. thank you for joining us today. >> my pleasure. well, we have just about a half hour before the closing bell. the dow, the s&p and the nasdaq have been marginally lower in the day. that's still the case and energy is today's outperformer with crude up. when we come back, why shares of sotheby's catching a huge bid and later chief strategist on the stocks that the clients are buying right now. ♪
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welcome back. sotheby's smars popping on an earns beat. declining expenses and better margins helped to offset what was a 16% drop in net aubs sales in the quarter. year to date, sales down 30%. >> boy. and the stock up 13.6%. sold! >> yeah. >> take it to today. time now for a news update with court reagan. >> hi there, bill. thank you. here's what's happening at this hour. the family of a muslim boy arrested after bringing a clock to school filed a federal
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lawsuit claiming they violated the boy's civil rights. ahmed mohammed was arrested at the dallas high school back in september charged with having a hoax bomb. fcc says at&t will pay nearly $8 million after a probe found it allowed third party charges on the bills and a practice known as cramming. the scammers were allowed to charge customers about $9 a month far bogus directory assistance service. russian president vladimir putin arriving in the capital city to hold talks with the presidents of azerbaijaazerbaij. and delta not the only airline having a bad day. seems argentinian golfer was one of the rising stars on the pga tour tweeting that american airlines lost the clubs and may not compete in the olympics.
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this's the news update for this hour. gosh, that ruins your month or year. >> or every four years. >> right. exactly. >> a lot of tennis players were having a nightmare commutes down to rio, as well. >> you can't carry those on. >> you can carry your golf clubs but they're taking the tennis racquets. >> i would. >> keep them in the line of sight, for sure. >> thank you. heading into the last half hour of trade for this monday. s&p did hit the all-time high intraday earlier in the session and pulled back meantime. we have a leading trader to join us. and we are on the lookout for another boatload of earnings after the bell. hertz, lendingclub, news corporation and twilio. big names on deck. we'll deliver their number it is second they hit the tape and break them all done coming up.
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take a look at crude oil up 2.5% on wti. it's been leading the market throughout the morning. of course, dipping into a three handle territory last week but now chatter about potentially
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informal opec talks in september putting a bid under oil today. take a look at marathon, hess, conoco phillips. the energy market has at least, bill, one day in the green. >> at least for one day but wait. we'll see what happens tomorrow. joining me on the floor of the new york stock exchange with the dow down 28 points, my friend peter cost 51. why not cat days? what is that about? >> people don't like cats. you like cats? i have a dog. you have a dog? >> i do. but dog days connotes doldrums. >> you walk around and look at your dog? they lay there for four or five hours. the's nothing going to happen. >> what is coming across the path? like, for example, friday's rally. we haven't had a meaningful pullback. brexit vote. >> right. >> what do you make of that right now? >> i think we are ripe for it.
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there has to be a catalyst. i don't see into the future like what that catalyst could be. you would think maybe opec's meeting, meeting this week or next week. i kind of feel there's nothing to come out of that, anything significant. >> earnings? you know? >> earnings, you know, the season's almost over. we have numbers coming out this week and should be something to be aware of once you start seeing the numbers perking up again, con surmer's starting to spend and 70% of the economy. i think that you're going to start seeing the purse strings open. >> with the vix at 11, complacency and experiencing that right now? >> 10.5. that would be the time to start shorting the market. 10.5, you see the market sell enough. >> i'll call you. >> i will be here. >> thank you, peter. >> thank you. >> kayla? >> all right. thank you, bill. with about 20 minutes before the close, the dow down 28. the s&p despite hitting a record intraday high, right after the
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open, that end deposition is down about 4 points. the nasdaq down 13 although the nasdaq and the russell 2000 both touched a 52-week high earlier today. stocks staged that big rally in july but td ameritrade clients were actually net sellers last month. why is that? up next, td ameritrade chief market strategist will tell us what they were selling and whether that trend will continue. plus, time warner's "suicide squad" killing it this weekend wiping out the film's negative reviews. some movie moguls think it could be downhill from here for the warner brothers film. we'll discuss on the other side of this break.
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shares of bristol-myers down today. credit suisse downgraded it and cut the price target to $63 a share from $86. it is not at $60. firm said that the lung cancer treatment is too significant for us to maintain our bullish stance end quote. mean tile, td ameritrade
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clients in july were net sellers for the month despite a big rally month for stocks. clients sole costco, alibaba and ge and bought fook and some financials. >> for more on this movement and what it says about the broader market conditions, we welcome back j.j. kennahan. your customers tend to be contrarian. they buy when the market is low and sell when the market is high. do you think that's going on right now? >> i think it is, bill. we know that's a way you like to see people trade a little bit more. they were net sellers of equities and engagement with the market came down a bit. besides the fact net sellers. volatility came off significantly, even compared to overall market. the stocks of apple and bank america which our clients hold quite a bit of and i think one of the interesting points is as the market hit all-time highs, some of the individual stocks, you know, you mentioned ge,
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obviously a very widely held stock by all of retail, we saw net sellers there because people are starting to take advantage of these bigger movements. a stock like alibaba held for a while, get to highs and people see an opportunity to start selling some of the things they may have held for a while and it's something, again, you like to see them get out of some of the position getting there, bill. so we don't have a situation like 2008 where big down moves, paper profits absolutely deteriorate. >> right. we read that your clients were buying financials but not just any financials. it says that they're buying barclays which reported earnings towards the month of july and stock cut in half last year and one of the hardest hit after brexit. so i'm wondering why td ameritrade clients feel like perhap that is's a buying opportunity. >> well, i think part of it, kayla, they feel like maybe brexit, you know, again, on the initial news as we awe saul, the market getting hit an punished and the news come out since
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then, we're learning it's going to be a longer and longer process and i think really clients felt that the pendulum had swung too far on a stock of barclays and bought wells fargo and bank america and other thing about the stocks is even if the fed doesn't raise rates, the hint of rates going higher as we saw last friday from the employment report it's a way for them to play that and stocks that paid dividends and in case the rates don't go up, they get a dividend and play it for both ways and even if the fed raised rates, it is not terrible versus the return of 10-year or 30-year bonds. >> they were buying ford at a time when the company, their earnings disappointed an ena feeling that maybe sales have peaked this time, maybe we're heading into an automotive recession of sometime in terms of sales. what do you make of that? >> well, that's a second month in a row, you know, we saw ford and gm last month.
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i think it's about is yield. everyone is chasing yield everywhere. you have the automakers paying near a 5% yield. so when you see people buying a stock like that, that's really all you can figure and also, you know, it's at a relatively low price point in the mid-12s and a way to take a small portion of the portfolio. put it in a stock like that and the downside may be limited and same time they can try to get the 5% yield and even if the stock holds a level here, they'll be okay with that investment until the fed shows signs of raising rates. >> j.j. was the activity of july just sort of reallocating existing positions or outflows of port foal lows? did you potentially see cash coming in from the sidelines? >> that's a great question, kayla. i think what you are starting to see is cash coming in. it's primarily reallocating portfolios and not surprise me if we continued to see this sort of activity as we head into the election. there's a lot of unknowns.
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the good thing is we're not seeing outflows but a little bit more money come in and this is a true indication of putting a toe in the water compared to, you know, if you have money in the market, people are not going all in. and i think that's actually a good sign as we hit all-time highs and lived through the times where you get to all-time highs and then money comes flying in off the sidelines and that's when people tend to get burned and i think the cautious getting back into the market at higher levels is a much better thing to do and as, bill, you started the segment with, selling the stocks up near 52-week highs and reallocating to other stocks with upside. >> that's where we're going to end. how about that? good to see you. >> thank you. always a pleasure. just about 13 minutes before the bell. after a brief rally at the open, the dow and s&p are still fractionally negative. losing a little bit more since we last checked a few minutes ago and still fractionally -- >> not easy coming up with new
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ways to describe the market just sitting there, is it? >> not four decimal places, luckily. >> san francisco based cloud communications company trial wia month after coming public. we'll tell you what to expect from that company and others coming up next. mation. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. perfect driving record. until one of you clips a food truck. then your rates go through the roof. perfect. for drivers with accident forgiveness, liberty mutual won't raise your rates
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welcome back. you mentioned this. big day for twilio. first earnings report after going public not too long ago. josh lipton joins us from san francisco. josh? >> well, bill, twilio is up some 180% since that june debut. today wall street thinks the company is going to report a q2 loss of 14 cents on revenue. $58 million. focusing on the company's dollar-based net expansion rate, that's a fancy way of saying revenue of active customer accounts. surged 170% in q1. remember whassap and using dwil owe.
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at the same rate? we could soon find out. back to you. >> all right. thank you. we'll see you at the top of the hour when the numbers come out. joining us on the floor of the new york stock exchange is david pearl, co-chief investment officer at epic. >> hey. >> you're one of those guys that's -- you're a stock guy. i mean, you are always looking for free cash flow, high profitability. those kinds of things. are you seeing that in the areas of people interested in investing right now? are you having to be a contrarian to invest these days? >> felt like we have been a contrarian for 12 months, to tell you the truth. we have had three corrections. every correction you want to own defensive stocks, low volatility, high yield. even though the u.s. economy has been growing. in fact, all the corrections had to do with non-u.s. events. china meltdown. brexit. european banks. it is now apparent that the u.s. economy is sustain bring growing, going to be a little above 2% for the rest of the year making up for a slow growth in the first half and should own
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economically sensitive stocks and underperformed and all at discounts. that's the stock picking opportunity. >> so does this mean this week you're buying retailers ahead of retail sales, which a lot of people are expecting that that will fall more in line with positive data out of jobs than the slow growth of the second quarter? >> yeah. retailers are a little bit of an interesting area. services like rest rapts have been doing quite well. you know, consumers are spending on experiences. travel, as well. so it's changed but consumer demand is solid. 3.5% to 4% growth year over year. the purchasing power is up. that and enterprise spending is up. kind of froze in the first half of the year due to the concerns around the world. it's picked up. so enterprise spending, like the cloud so we're seeing that spending go up. >> speaking of the cloud, a lot of people like tech stocks that pay a dividend right now. i still can't get -- my head
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wrapped around the idea that tech companies pay a dividend. you like them, too, don't you? >> yes, we do. they used to think they're growth stocks and always reinvest every dollar. you can't grow to the moon and some are getting rather big and the right thing to do is re-invest when you have. otherwise, give the money back. pay a dividend and some unusual cases. i know we talked about sea gate. this company is the supplier of hard drives but it's really storage and the cloud is servers and disk drives. that's what it is. and that growth is going up exponentially with the amount of data we use. that company has a 7.5% dividend. people obviously don't believe it. but right now, they're earning more than they need to pay the dividend. >> servers and disk drives not quite as fancy or sexy. >> thanks. good to see you. david pearl joins us today. we have the market down 20
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points right now on the industrial average. we have the closing countdown in just a moment here. and of course, donald trump, presidential hopeful laying out the economic plan today in detroit. we'll talk to two economists about how this would actually play out were it to be put into effect. closing bell will be right back. ♪ [announcer] is it a force of nature? or a sales event? the summer of audi sales event is here. get up to a $5,000 bonus on select audi models.
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all right. 2:30 left in the trading session with the dow down 20. we have bob pisani here with me
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doing the "closing countdown" today. we'll highlight the s&p since that one had some movement upward this morning and hit an intraday high before it headed lower again. but it is one of those days where we are definitely in august. that's for sure on wall street. wti oil. continued to rally today. although it pulled back a bit as we got toward the close. the settlement price. but still, it was in the $43 range for a time. 42.88 here with a gain of 2.5%. energy stocks really kept the thing going here and there's the 10-year note here. energy in a minute. >> 10-year got to 1.60 i saw at its peak and then pulled back here so we saw some selling there today, as well. >> but remember the moving up towards 1.60 very good news. banks up earlier in the day on the news and market leader besides energy that's out there. some of those banks. >> we have earnings still to come tonight. we mentioned twilio a little while ago reporting the first
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earnings since going public not too long ago. lendingclub on there. news corp. and then hertz global reporting tonight. >> lendingclub on the recent difficulties, as well. of course, hertz global, that business has been fair. i would say to be kind about the whole thing. >> about that vix, huh? >> i want to talk about -- want to talk about the leadership because people wondering, oh, we are not going anywhere. we are just spinning our wheels. actually, we are not. there's a lot of interesting rotation going on so if you look at when's been mattering, energy stocks in the last week since we bottomed last tuesday. energy stocks up about 4.5% because oil up about 8% and all the oil names up again today as we have been moving up around oil around $43. other big thing is financials with slightly higher interest rates recently. the banks have been up, as well. finally the semiconductor index. stocks of invidia, broadcom
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moving up. there is rotation going on with energy, financials and tech particularly economy conductor. >> speaking of which, chick tech ringing the closing bell here as we continue with the second hour of "the closing bell" and ready for the earnings coming up right now. welcome to "the closing bell" i'm kayla in for kelly. bill will rejoin us again shortly. here's how we fin initialled the day on wall street today. the nasdaq and s&p looking for four straight days of gains and the nasdaq touched a fresh intraday open at the open. dow down fractionally. best of the major averages, though, health care was the underperformer there. energy and financials still closed in the green. investors now set for a trio of big earnings today.
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julia boorstin on news corp. josh lipton ready for twilio. and adidi roy following lindingclub and bob mentioning, of course, a lot going on out that company and watching all of the reports closely when they hit momentarily. joining us is cnbc contributor from "the washington post." also with us for more on today's market action is "fast money" trader tim seymour. welcome to all of you. i want to start with you. oil continued to climb off of some new lows that we hit last week. the fed had been worried about oil earlier this year. but now people are saying maybe what we were seeing is just technicals. the fundamentals of oil aren't really showing any cracks. >> how do oil prices feed into inflation? the fed had a target of 2% inflation and has been missing that target for a long time, it looks like there might be some movement some potential that we're getting closer to actually seeing that but now they're asking themselves a new
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question, do we need to go over 2% inflation in order to ensure that we meet our goals because we have been under it for so long? that's what i this i they're looking at in terms of oil. how will it impact the inflation scenario and be able to have enough information by september to make a decision? >> tim, where are you finding opportunity in a world with the vix at 11 right now? a whopping number. >> a place you want to be adding to ownership however you want to do it but i think as she talks about, the oil discussion has to then lead to a discussion of reflation trade. looking at the dollar and the face of what's been at least better economic data here, it tells me that the trade that continues to work is working mostly this year and been resources, materials and if you now bring banks into the equation, you have some sign that there is some pricing power on the yield curve, then i think these are things that continue
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to work and then we need to hear from the fed and it's been a quiet couple of days since that payroll number. not much on the horizon this week. you know, i don't know if they changed. i don't think they should be changing based upon that number but the reality is the fed concerned about inflation? i don't think they are. >> tim, we get a slew of data from china this week and some sense depending on the strength or weakness of that data that could be enough to sink the markets and doesn't look like people are focused on that today. >> kayla, the trade numbers out last night were not terribly good. the interesting part about it is chinese oil imports at record highs. up in july and that was down slightly from june but i think the fiscal story in china is on again, off again. we want to see china sideways and what people were forgetting about nine months ago when people were very, very searched about chinese growth is that china's been trading sideways on the industrial data for two
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years if not more and the recalibration of the chinese economy takes a decade or more. i don't expect good numbers out of china this week. >> we expect to hear from retailers. what are you expecting from these guys right now? >> we heard some interesting data points from retailers saying that the election started to enter into their calculations. there's been some uncertainty amongst consumers because of up coming poll sis and already starting to feed into sort of consumer anxiety and heard today from the new york fed, their survey of consumer expectations and they found that the number of people who say that they expect to miss a payment on a loan over the next few months is actually increased. 14% up from 13%. that's the highest level i believe since 2014 and some signs that there could be stress on the consumer and a strongest point in the economy so far and can't let the consumer go down at this point. >> we have earnings now from
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lendingclub. how do they look? >> hi there, bill. those earnings are in and the earnings per share at a loss of 9 cents per share. that missed the street expectations of a loss of 2 cents per share. on the revenues the earnings came in, the revenues came in at $102 million. that beat expectations of $101 million. and another key metric to look at here are the loan origination, that number came in at 1.96 billion which beat the expectations of 1.84 billion. that's a key metric, especially looking at the health of the company. again, you guys have been talking about the fact that this is a company that's had a lot of challenges recently. their ceo leaving abruptly in may because of an improper loan sale and transparency issues. on the guidance, guidance coming in between 95 to 105 million. and that's below estimates of $106 million.
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and the company's also want to point out announced some leadership changes. just reading this off the press release here saying the president and ceo of fannie mae has been appointed to the lendingclub board as an independent director. those are just one of the management changes going on. and we'll continue to track this and be on the conference call and get back to you with any updates. >> very good. thank you. >> the stock had been down about 8% after hours and now off the lows. another changes that the company announcing is that the cfo has resigned. to pursue an additional opportunity. of course, there's oftentimes more than -- >> lost the ceo and cfo. >> they have a new ceo. it says that the principle accounting officer is now serving as the interim cfo. for a company trying to get all of its looks in order, not something that you want to see. really. >> certainly not. the loan originations is encouraging. greater demand for folks, you
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know, looking to borrow and spend money out there? that could be a positive for the economy and seems like it's still unclear what's driving this. >> tim, this is supposed to be a space to completely disintermediate the banks and when the ceo resigned this spring, there was a sense that investors were losing faith in the sector. would you be a buyer sneer. >> no. the whole sector is wildly, wildly popular and in a lot of cases i'm not sure they're able to execute on the model. they need institutions on the platform and 0 olympic nations i don't think come back. i think they're probably troughing in the third or fourth quarter. so, no. i don't think you need to run back into the stock. in fact, i think there's a very, very expensive multiple attached to the stock right now. >> and it's sinking as we speak. back down to the low again. down almost 7% right now. >> we'll keep watching that as the company's conference call gets under way. you can imagine they're going to be getting a lot of questions
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about exactly how this leadership team is structured and exactly what they plan to do going forward. they're also some washington investigations going on. so all of that will update as soon as we have news. >> more earnings, this time news corp. reporting. julia boorstin, how did they look? >> hey, bill. the earnings missed estimates coming in at 10 cents per share versus expectations of 13 cents per share. it is up from 7 cents in the year ago period. revenue, though, beat estimates coming in at $2.23 billion. this is the fiscal fourth quarter estimates for $2.06 billion. now, in the company's press release, there's a lot of focus on digital and how the company is transitioning to be a more digital company and saying 23% of segment revenues from digital up from 19% in the last year. bute iine ins to be a problem and advertising revenues of $17 million of
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negative impact of foreign currency 5% to the weakness of the print advertising market and lower product revenues so continuing challenges for news corp. in terms of advertising and though the decline of 5% less than the 10% decline in the prior quarter. back over to you. >> and the stock down .5%. this is the slower growing member of the her domurdoch emp here. >> yes. the one you hold in your hand. not the one you watch on tv. tim, we have seen a few data points in the space. "the new york times" with disappointing numbers for the quarter. now news corp., too. secular change or a one-quarter blip, do you think? >> a little bit of both. they've seen some secular falloff and we know the transition going on. some of their publishing business is actually shown some signs of life. it's key, though, that i mean, the wireless acquisition is something that you want to hear
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more about. a bit of a surprise. i think some of the cost savings at news australia are also things that people more focused on here and not about the growth. right? it's about how efficient they run the company and strategic partnerships in the last three to six months and people scratching their heads on. >> i want your side of that, too. you're living this story. let's get to twilio, too. >> it's all depressing, bill. >> first quarter since the ipo. josh lipton has that out west. josh? >> kayla, twilio with a loss of 8 cents, versus expectations versus loss of 14 cents. total revenue clocking in at 64.5 million. that's up 70%. that beats the analysts' forecast for 58 million. just looking through the release here, so dollar based net expansion rate or revenue from active customers, up about 164% from the second quarter. it was up around 170% for the first quarter. turning to the outlook, total
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revenue q3, guiding to 63 and 65 million and full year between 253 million and 257 million and the stock heading into the print up about 180% since that june debut of 15 bucks. on the call, talking about the trends in revenue from active discuss merles. also, a high degree of customer concentration in this name so we want to hear about trends for whassap. that call at 5:00 p.m. eastern. back to you. >> all right. thanks. the stock up 2%. tim, did you try to get in on the ipo or like this company? >> this is the kind of stuff that i usually don't get in on. they go from 15 to 40. but look. this is a company unlike some of the others with phenomenal growth. they have an unbelievable client profile which includes whassap and uber and airbnb and a way for consumers to get investment into this software app wave and
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communications as a service platform is something there's a dearth of investment opportunity and why the stock trades expensive. they're delivering. >> two of three out now. one positive. we'll keep an eye on that over this next hour. investors have a lot of questions about the true strength of the economy after the dismal gdp report but much better than expected jobs report. steve liesman is there to reconcile it for us. >> when it comes to the economy we have a split decision. one corner, weak growth. other, strong. really struggling the figure out the right one and the winner here. it's an economy running below an already lowered potential growth rate of 2%. we are averaging folks just one percentage point on gdp and after dipping in may an june, three-month average of job growth near 200,000. almost double what fed officials think is the steady state rate
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for employment. so short term, most economists and fed officials side with payrolls over growth. the expectations is that over time you would -- they would come together and mean that one or the other of the data points for now could be wrong and later revised but if the reason for the split decision is one of these is wrong, it could lead the fed to a policy mace take following it. if they're right, we have more jobs and less growth. that is the economy is less efficient than it was and also means less profits for the companies, more wealth for workers and consumers. that could be good for the economy and okay for the stock market. what the fed wants to do is err on the side of caution and hiking rates. it will wait for the fall before doing anything. and declaring a winner in this split between weak job growth and -- weak growth and strong jobs, bill. >> yeah. steve, i think this is such an interesting point. i feel like we were in a similar moment in sort of a fall of 2013 where we had a really strong jobs number, weak growth and
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actually what ended up happening is jobs and growth picked up. any potential to happen again this time or just being an optimist, steve? >> absolutely. most of the economists i talk to say it's easier to count the jobs than it is to count the economy. a lot of economy is service. the actual costs or value added to that is very difficult to determine. and then if you had to pick one, they pick the payroll number. you could have an acceleration of growth and we have a productivity issue and that should not stop in my opinion a debate in this country about what's wrong with productivity. why aren't businesses investing in technology and enhancing capital goods out there. so that's a big question and i wouldn't say, you know, just because jobs are fine and growth is weaker, that we should not be thinking about how to improve the economy. >> that's for sure. all right. steve, thanks very much. see you later. steve liesman. and our thanks to tim seymour, as well. catch more of him playing water
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polo at 5:00 p.m. this evening. >> i'm very good at this. >> thank you, tim. when we come back, walmart buying for $3 billion. but will this move be able to help walmart take on amazon as the fastest growing online retailer? two top retail experts weigh in next. also, republican presidential candidate donald trump unveiled the economic plan. that would cut taxes and curb regulations. how that could affect the economy an our national debt, still to come on "closing bell."
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so as you probably have heard, walmart is buying for little over $3 million. will it help the retail giant take on e retail giant amazon? >> joining us is david straszer and sucharita malparu. thank you both for joining us. david, i'll start with you because the question is about competition and how exactly walmart will leverage to actually compete. how do you think they do it
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without integrating it right away? >> they're buying a platform, a relationship, an understanding of customers and things they have been lacking. i think it's great a transaction for them. revenue multiples are not relevant here. i think that they're not overpaying because they're getting things they really need. they need to understand the b to c customer better than they do now. >> do you agree? i mean, there's talk they're buying the ceo and get him to run their website in addition to is that simple or what do you think's going on here? >> i think that that's definitely a significant part of it. this is no question that this is an acqui-hire. they have built an amazing site in a short period of time with unique and innovative technology and want to bring it to and i think that that's -- if there's anybody to bolster it is someone like marc lore.
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>> as bullish, david, as the story is about him founding the company, selling it, buried in one of the stories was the fact that jet in the process of raising $640 million. is there any threat of this that you think is an inability for an investor to plug more money into a money-losing venture and them having to sell versus wanting to sell? >> i don't think so. i mean, it's not -- i don't think it's a coincidence as it comes a week or two after dollar shave club was sold to unilever. it is almost the same thing. buying a platform. they're buying people, buying an entry to millennials and very big companys that have kind of struggled against amazon, a lot of other smaller guys. in our every day, looking at businesses that have a great connection with the millennial and those are type of investors and companies we're investing in, ones that are changing the way business is done on a daily
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basis. >> this is elan from "the washington post." do you have any sense there's something personal in the deal here? marc lore's first business and sold to amazon back in i believe it was 2010, you know, he sold it to that company after jeff bezos apparently said he'd go thermal nuclear on him cutting the price so low that he could not compete. is taking this to walmart, you know, something maybe a little poke in the eye there? >> possibly. there's no question that walmart and marc lore have a history and that history was, you know, dates back to possibly before that. and there is no question that at this -- this is a transaction that walmart didn't want to lose and that's one of the things i think is important to keep in mind, even if jet was out there raising money, this is a pretty generous premium for a company
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that would have been desperate to take it. >> all right. well, we'll see if this works out for them and whether walmart can become cool to millennials as a result of that. thank you both. thank you for joining us both today. >> don't miss an exclusive interrue of walmart ceo doug mcmillon and co-founder marc lore tomorrow on "squawk box." we have a news alert on gap. when's going on? >> we have gap's july comparable sales. for month of july, the total comp sales down 4%. that was worse than what wall street had been looking for for a comp decline of 1%. however, gap also giving us guidance here for the second quarter and that guidance range for earnings is actually quite above what the street had expected. the guidance range of 58 to 59 cents versus 48 cents for a consensus on the street.
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and revenues also for the second quarter coming in here according to gap of 3.85 billion which is also stronger than what wall street had looked for at 3.78 billion. as you can see, those shares are down after hours but coming back a bit perhaps as investors wade through actually a decent amount of good and same store sales disappointing. bill? >> all right. yep. well off the lows down 2.6%. thank you. what do you make of them? >> good to hear but the fact that sail store sales are down, i'm surprised they're reporting that still because it's declining for so long. i was telling the same story ten years ago. >> they're in the middle of a turnaround and we'll see if that pays any returns in the coming months, for sure. all right. let's take a break. a computer outage grounding delta flights around the globe this morning. many of you already know about that. the ground stop, though, has been lifted. many flights are still delayed, though. when we come back, we'll head
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last week in atlanta about the stellar performance to this point and this morning was a very different story with the power outage in atlanta that forced delta to ground its global fleet. >> susan li is following this story for us today at lagardian airport in new york city and has the latest. susan? >> reporter: yeah. what a difference a week makes, right, kayla? we have heard from delta telling us that 450 flights canceled as of 1:30 p.m. today and delta points out that 1,700 of the 6,000 scheduled flights today have taken out and landed and from here at laguardia airport we have noticed more activity, more pickup in the activity delta flights landing and taking off. they're trying to get back up 100%. ed bastian this afternoon saying that it's all hands on deck. >> i apologize for the challenges this has created for you with your travel experience.
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the delta team is working to restore and get these systems back as quickly as possible. >> reporter: yep. they're doing their best right now. early morning power outage in atlanta crashing delta's global airlines system. so delta has issued a system-wide waiver and they'll rebook, refund passengers that have been on these canceled flights or they have been significantly delayed. significantly delayed, though. that's on a case by case basis. back to you. >> you know, i saw your interview with gordon bethune this morning and talking about continental with a backup generator system that they were able to implement. clearly delta wasn't able to access that today. >> if we have susan with us -- >> she is there. >> is there any sense that delta did not have backup power, that there was something more beneath the surface on this? >> reporter: we were talking to georgia power to get at the
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heart of this and georgia power says that the outage is owing to delta's own equipment. they haven't had complaints, received any report of anywhere else across the state. and some are pointing to this switch gear, a switch gear, maybe flicked off the power in atlanta and that's basically crashed the entire system. but you're right, we don't have details in terms of why they didn't have backup and the global system crashed and just, you know, one power outage in a state, a city. >> i'm sure delta also trying to get to the bottom of this and seeing the details to get. for now, thank you. >> thank you, susan. time now for a cnbc news update. for that we go back to courtney reagan. >> who else? >> working all the beats this afternoon. here's what's happening at this hour. the islamic state claiming responsibility for a suicide bombing in pakistan killing 70 and wounding more than 100 on a gtherring of laurels mourning the loss of a respective colleague. the white house condemned the
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attack. brush fires in california. san bernardino national forest. more than 7 square miles burned. some 300 firefighters fighting the blaze which official said is 5% contained. and hulu moving to an all-subscription model. comcast which owns this network is a part owner of hulu. president obama hitting the links while on vacation golfing with steph curry at in oak bluffs. the president and family spending two weeks at martha's vineya vineyard. did he hit a 58? that's your cnbc news update at this hour. for now, back to you. >> what an incredible round on sunday. >> wasn't that awesome. >> good for him. meanwhile, donald trump laying out the economic vision for the country. but will big tax cuts renegotiating trade deals and curbing regulations help get the economy back on track?
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we'll hear from a top economist up next. plus, just abysmal reviews did not stop "suicide squad" from making a killing at the box office over the weekend. coming up, we'll tell you how much money the film made and whether it could see a huge falloff next weekend when we come back.
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xfinity. the future of awesome. energy the outperformer today. crude oil higher by about 2.5%. chatter of a potential opec output freeze putting a bid underneath oil today. but, of course, we'll see what tomorrow brings. at least the market's happy to see a four handle on that. we'll talk about donald trump and his speech today where he talked about cutting taxes. let's listen to what he had to say in his economic speech before the detroit economic club today. >> under my plan, no american company will pay more than 15% of their business income in taxes. i am going to cut regulations massively. massively. our lower business tax will also
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end job killing corporate inversions and cause trillions in new dollars and wealth to come pouring into our country. >> so let's talk about what impact a trump presidency would have on the economy. if these are the strategies that can be -- make it through congress. joining us cnbc contributor joe lavornia here on the panel today. you know, it's clear everybody feels it's fiscal policy that's needed now to try and jump start the economy and the republican strategy clearly is to cut taxes. is that going to help do that, do you think? >> you mentioned monetary policy. rates are effectively zero. long bond is well under 3% and ran out of options on the monetary side. fiscal side, bill, it is really i would say do both, cut taxes and increase spending especially on infrastructure. i think for mr. trump, a bit of both. tax cuts and spending increases.
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not one or the other. >> the question of donald trump's tax plan is that, you know, he is made really big point of saying revenue neutral. how do you cut taxes? how do you expand infrastructure spending? create a child care tax deduction larger than now, leave entitlements intact and be revenue neutral? >> i would say be as fiscally irresponsible as possible. credit fiscal irresponsibility. that sounds silly. i say that because there's right now demand shortfall in the u.s. if you look at the non business -- rather, the non consumer side of the economy, it is shrinking. therefore, we need aggregate demand. i don't care the way it comes. revenue tral, i don't know. we can't score it. look. if we have a big deficit, that is not necessarily a bad thing. >> is there proof of the policies laid out have the desired outcome?
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just because you lower the corporate tax rate to 15% doesn't mean that the companies are automatically coming back home. they won't immediately be repatriating cash and if that's where their customer is it just becomes more expensive. how many of these outcomes do you think we'll see? >> kayla, that's a -- i have no idea but what i can tell you is that in the current business cycle, only cycle where government spending essentially over the duration of the last seven years is actually shrunk. some may argue that's good. i would argue that austerity hurt with weak demand elsewhere. so what i would argue for good old-fashioned pump priming. if you could overlay this, this would be like a nirvana. big deficits in the short run with a bowles simpson plan overturned in year 11 is great. with stimulus.
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both parties agree on infrastructure spending. i think there's agreement. maybe they're negotiating ploys. i think we need to spend money. >> with all due respect to my "the washington post" colleague next to me, there was a piece in "the new york times" over the weekend, believe it or not -- >> not as good as the one on hillary clinton. >> neil irwin wrote about the economy and why we have seen this slow growth persist not only here in the u.s. but globally and, you know, his take is that there's a secular stagnation going on right now where typically more supply would create its own demand and not happening right now. you talked about the dearth of demand in the economy. even if companies decided to increase production there's no guarantee to get anybody to buy it. >> that's why the infrastructure plan would sell and both parties have said it. larry summers a big proponent of infrastructure spending. roads, bridges, highways, et cetera. because of this notion of secular stagnation. i don't believe we're preordained on a path and one thing we didn't talk about is
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regulations. i could tell you from where i sit and clearly maybe i'm biassed but the regulations have certainly hurt the business an it's very hard to have a vibrant economy when you strangled the financial system. >> you are saying deficits be damned, this economy needs a fiscal hail mary right now? >> absolutely. 10-year interest rate recently got close to an all-time record low. so, i mean, you don't have to worry about crowding out in the environment and should be spendispend ing on some of the things we are procrastinating on. >> on the regulatory piece, though, can the pendulum swing too far and a moratorium on all new regulations and stopping any new ones? is this something that governor mike pence did in indiana. they did see a decline of new regulations. however, they had a lot of -- regulations for safety measures, go forward. you know, i think that the claim
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seems to be exaggerated. >> lobbyists argue that's not good business for them. >> that's right. we'll see a hit on k street. right? >> you feel like the reagan deficits in the early '80s, real rates rising because the fed in part was real tight. and now's a good time to borrow and take advantage of it. i would argue to get economists on both sides of the political aisle to support it. >> right. i'll say trump's speech sounded reagan-esque today, didn't it? >> i'll say no comment. >> very good. thanks, gel. >> got to be objective. >> that's what we like about you. the zika virus and water pollution have been two of the biggest concerns for athletes at the olympic games in rio. coming up, we'll show you how they've been adapting to that. but first "suicide squad" smashing box office records over the weekend despite terrible reviews. how the film defied the critics and whether it keeps raking in the cash. matters. n, every millisecond
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you would think "suicide squad" dead on arrival after reading the awful reviews by kritings last week but the film smashed box office records over the weekend. julia boorstin has the details on that. julia? >> reporter: hey, kayla. that's right. warner brothers "suicide squad" grossing $135 million in the u.s. over the weekend setting a new record for the largest august opening weekend and the largest august opening day ever.
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including another $132 million from overseas, the film's worldwide open iing reached "deadpool." critics gave it a 25% rating on rotten tomatoings but a 72% score. but will they see it a second time or tell their friends to see it? performance at the u.s. box office dropped 41% from friday to saturday. that's a huge decline and that could hurt time warner's profits from the film costing a reported $325 million to produce and market. that 41% drop is bigger than warner brothers "batman v superman" attributed to similarly negative reviews leading to declines in following weeks. how much "suicide squad's" box office drops in weeks is key not only for this film's health but
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the franchise of d.c. comics with eight other films in development. guys? >> you know, will smith himself in the kannes film festival deboning the media and speeds up the process of word of mouth. the movie is just starting and people tweeting whether they like it or not. can have a big impact. >> exactly. >> given how strong the box office was if they're concerned about whether it has legs. >> reporter: well, it's really about the decline from friday to saturday. now, warner brothers said the reason there's such a big decline of friday to saturday is that so many people went out and saw it thursday night. but what you say about social media is really true, bill. what we are seeing is in the past ten years ago studios could market a film and basically guarantee a big opening weekend. because people would go see it because of the marketing but now because of social media you can guarantee a big friday night and
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if people don't like the film you see a drop-off to saturday and sunday. we'll see have to see how much it drops off to next weekend with these movies, you really want the fan boys and girls to see it multiple times. that's what really drives a film like this to a billion dollar worldwide number. >> although traditional marketing in that "vanity fair" promo got interest in margo robby. >> yeah. she certainly is quite the star. >> all right. julia, thank you. julia boorstin with the box office update in l.a. let's get to dominic chu for a quick market flash. dom? >> watching first of all u.s. steel shares off by about 3.5% on an around 129 million sharyls worth of volume saying there's a secondary offering of stocks and option for more if they want it for demand.
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also want to call your attention to what's happening with biomarin pharmaceuticals, off by nearly 100,000 shares of after hour selling. both companies say they're going to use it for general corporate purposes. u.s. steel saying it can improve financial flexibility. biomarin for gene therapy programs. two moves after hours on secondary stock offerings. back over to you guys. >> all right. thank you so much for that, dom. appreciate it. meanwhile, the wynwood section of miami the epicenter of zika virus in south florida and some business owners say feerls have made the area a ghost town over the weekend. up next, we'll hear from one who says the business has been cut in half. by the way, tomorrow on "squawk box," don't miss the exclusive interview of doug
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mcmillon joined by marc lore and talking about the $3 billion deal of walmart buying that's tomorrow 7:00 a.m. eastern time on "squawk box" here. stay tuned. where we explore. protecting biodiversity. everywhere we work. defeating malaria. improving energy efficiency. developing more clean burning natural gas. my job? my job at exxonmobil? turning algae into biofuels. reducing energy poverty in the developing world. making cars go further with less. fueling the global economy. and you thought we just made the gas. ♪ energy lives here. why don't you let me... and me... help you out? ♪ you're gonna hear what i say... ♪ i love taking stuff apart and building new things out of it. anne: pal's my most advanced annedroid. [gasps] this is awesome.
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business owner from that area. luis is founder and owner of wynwood brewery. thank you for joining us. we feel for you, buddy. how bad is it? when did it start and how bad is
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it? >> thank you for having me. really honored to be here. so, i mean, the whole scare started about eight, nine days ago when the cdc declared the zone, i guess, the hot zone for zika. >> right. >> for us, you know, i mean, for us the sales this week haven't been as bad as we thought it would be. the weather for sure has been taking its toll on us, also. >> what is business like normally in august, luis? is there a slowdown in miami tourism in that month? could there have been a greater impact if it happened in, say, the winter months or if it extends until then? >> for sure. if it extends to the winter, prime season for us, it would impact us. august is usually very slow month for us. you know, a lot of people -- a lot of locals go to vacation before school starts for the family so, for instance, i'm
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going on vacation two days from now. august overall is a slow month and also rainy season, very hot. so that's what -- one of the thing this is's affected -- past weekend. it is tough to really zone in on how much the zika scare has impacted us but to say it hasn't i would be lying to you guys. >> luis, what have you heard from your employees? are you handling any concerns about them about their own personal health and are you worried about getting bitten by a mosquito? >> my employees overall seem to be pretty positive. there hasn't been -- nobody that's really scared. we have an amazing group of staff that works with us. we're trying to do our part to kind of, you know, kind of get rid of any standing water, anything. thankfully our business is outside of the hot zone. sort to speak. so they feel fine. >> so -- >> me myself -- go ahead.
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>> we are running out of time here. you just have to wait it snout you met with other local businesses there. you just -- what's the strategy? just wait it out or what? >> well, i mean, we want do get some more information from the federal government, the cdc, honestly. there's been six cases that presumably have happened or bourn out of wynwood. we don't know details. us as businesses want the know what the truth is so people don't get terrified. there's a health issue that happens and we don't want, you know, women that are pregnant or that are looking to conceive to come or to run the risk. >> right. >> but, you know, the rest of us who don't necessarily fall in line like that, you know, obviously scared because they don't necessarily know a lot of facts over information about what zika really is. >> well, join the club. we're all still figuring it out as it goes on. appreciate your time. >> thank you, guys. all right. take care. >> enjoy your vacation, too. >> thank you.
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>> wynwood brewery here. we heard about the zika virus there in the miami area. >> up next, we'll show you how zika's impacting athletes in rio and how they're adapting to fight it. [announcer] is it a force of nature? or a sales event? the summer of audi sales event is here. get up to a $5,000 bonus on select audi models. what is freedom? yes, it's riding a horse across fields and stuff. but it's mostly getting to watch your directv with unlimited data from at&t. we're setting families free. so they can stream away - and not squabble over who's using how much. so go, family. watch. freedom. ha!
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athletes in rio are adapting to fight the zika virus. carl quintanilla on the ground with a look at the precautions that athletes are taking to stay safe. >> reporter: to address zika concerns, underarmour with uniforms for 250 e limpians including gymnasts, rugby and boxers say all of our teams will gate variety of gear that includes multiple long sleeve/pant options. but long sleeves are just the start. the soccer team has over 600 bottles of bug spray. while the u.s. rowing team is working with north carolina company insect shield to treat the team's competition and casual clothes with a repellant through 70 washes. for rowers and sailors, an added challenge of the polluted bay and lagoon. long contaminated of sewage and trash. in response, the u.s. rowing team sporting seamless outfits to cover 50% of the bodies and
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feature a moisture wicking finish to protect them from the potentially dangerous waters. the uniforms are provided by philadelphia based boathouse sports which spent nine months developing the outfits with athletes. >> that was carl quintanilla in rio with a look at what companies are doing to protect against zika. although he had said that they really hadn't seen any mosquitos. meredith viera said the same thing in an interview and better safe than sorry. >> they love to bite me. i have eight at any given time. >> i'm so sweet. >> you wouldn't go there. the greater the hype, the less likely it's going to happen. right? so we -- not -- i mean, god forbid something happens and obsess over it and kept some of the athletes away from rio for health concerns. but that's their problem. and their decision. it is possible after learning
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more about the flight patterns of these mosquitos and how far they don't travel when all is said and done that maybe it is not as big of a problem. knock on wood. >> the consequence so dire if there's an infection. i think that's part of the concern. world bank released an estimation in february saying estimate $3.5 billion of economic impact from the zika virus in latin american countries in a best-case scenario. so, you know, that's minimal for latin america compared to gdp and a big number looking at the headline. >> very rare to get credit for averting a crisis and hopefully the outcome of this situation will be that the preparations were such that it became a non-issue. >> it would be the one thing in the olympics, right, not -- no longer a crisis after brazil suffered in terms of economy and preparations, et cetera. you know, if they pull it off, that's a big one. >> there's a backdrop and admit the competition is spectacular so far.
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>> a few days in, too. thank you. >> good to see you. >> thank you. >> see you tomorrow morning. sleep well. >> i'm going to sleep here. >> all right. that does it for "closing bell." our olympics coverage begins right now. see you tomorrow. stay tuned. olympic style. this one is for fifth place, the match for that showdown, number six usa and number five, france, in the white kit. the first possession by the united states off the kick. that is


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