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tv   Closing Bell  CNBC  March 21, 2017 3:00pm-5:01pm EDT

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today, technologies nancy is adding to. >> and don't lose sight ever of allied headlines. >> thanks everybody for watching "power lunch." >> "closing bell" starts right now. hi, everybody. welcome to the closing bell. i'm kelly evans at the new york stock exchange. >> busy day indeed. stocks on track for their worst day of the year so far. and actually the worst day since last october 11. there are concerns about whether president trump and speaker ryan's health care bill can get passed through the house on thursday. that seems to be weighing on investo investors. but you also have the financials, the retail sector and the transports all taking a hit all for different reasons. so we'll have more on what is behind today's selloff. >> and we have a first on cnbc interview with the ceo of ibm on
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the company's relationship with china and any trade concerns. ginni rometty interview is coming up. >> kayla tausche is on capitol hill. and bob pisani on the floor. and better thrtha coombs at the. they're still trying to convince the freedom caucus? >> this was supposed to be the low hanging fruit and the promise of president trump's pro-growth policies coming to bear depends on what happens this thursday when house republicans are set to vote on the american health care act. president trump meeting with republicans at the white house this afternoon to discuss the bill further, having posted photos on instragram with health republicans this morning and the hash tag pa #pass the bill. they say it is just business as
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usual trying to get a deal done. >> if the house passes something, i'll bring it up and then we'll bring egin to work o in the senate and you'll have lots of stories about various people lobbying for different parts of it and we'll try to move it across the floor next week. >> he said earlier that he was confident that the house would pass it, but then he said if. it cannot pass if more than 21 of 237 republicans oppose it. nbc news currently tallies 26 votes in jeopardy. the "new york times" estimate 48 members concerned. and 52 unclear or decided as of noon today. the house freedom caucus alone has 30 members and its chair is still a no. he told reporters today it's not a personal vendetta against the president who called him out at that meeting today, but a policy position. >> we're counting heads at this point. so is it 26, is it more, do we need a wall, a man?
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we feel like whips. >> that's why can god created party whips. you have to get them to work to count those noses. >> any sort of graphic would be helpful. but i did see one tweet from a producer on capitol hill that asked the chair of the house freedom caucus it would be possible to get a deal done and he said there is still 48 hours on. so clearly even those opposed to it still believe there is some ground for compromise, that this still could get done. but we'll see what happens in that time frame if it actually does. >> sounds like 48 hours is a lot. clearly tv time. let's get over to bob pisani to walk us through the fallout here at the new york stock exchange. >> three major problems for the markets. one is continuing fallout from the fmoc meeting. dollar weak fast buying yield weakness. goldman sachs down 3.5%. this is one fourth of the entire reason the dow is declining. second problem, anxiety over the
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trump agenda. a lot ride egg on ting on that . it's killing all of the retailers. this is a 52 week low in target. bed bath & beyond, under armour, 52 week lows. the third issue, oil sitting near the lows for the year. take a look at some of the oil names. down again. a patcch chtchy apache straight. and finally a little concern in the car sector.patchy apache st. and finally a little concern in the car sector. di disappointing guidance is moving them. car names where down, as well. but we are sitting 52 week highs because the cruise lines are doing great overall. here is an historic oil royal caribbean down now, but earlier in the day historic highs. cruise trends consistently strong. bookings are great. we'll talk more about that at
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the close. back to you. >> now to bertha coombs at the nasdaq where just yesterday, you had an intra day all-time high, but we're far from that right now. >> and at the open we hit an intra day all day high and then we have just retreated from there. so first time we've seen the nasdaq move more than 1% in a single day since the beginning ever december. and what we saw today in terms of all-time his were the usual suspects. but they have definitely faded. but it's not so much a large cap retreat as it is a small can retreat. a lot of folks watching the situation on the hill wondering about the agenda particularly when it comes to health care and biotech in particular today getting hard hit here at the nasdaq. the large cap biotech having its worst day in about two months in terms of a percentage loss. but it's also been the biggest gainer. so you may be see something folks taking some profit off the
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table. among the lows today, endo phrma, also pbm hitting a new low, as well. but also a few names are bucking the trend. including bio gen. back over to you. >> all right. thank you very much. let's get to our closing bell to kick this around with peter bookbarn from the lindsay group peter gill and rick santelli checks in from chicago. so guys, what do you think? sarge, pick your sector as i said. each one is going down for different reasons today. what do you make of the selloff? >> well, it makes sense. doesn't feel very good, but it makes sense. we have political risk, health care reform that is putting tax reformat risk thus endangering the whole reflation tratd.
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trade. so we're having a deflation trade today. what are they buying? gold, treasuries, bond proxies. it does make sense. i went shopping myself today. this is not going to scare the stuffings out of me. i thought on airlines looked good yesterday, i bought them today. i bought southwest, delta. hin i hedged myself, but i did dive in. >> and i thought about the retailers, they could use a break. but you're talking about wall street. peter, you talked about this earlier and here's what he had to say. >> more adjust ability has become a begin, that it will be part of the final tax reform plan and really now discussions are how can it be designed in transition in a very positive way for importers. >> that was representative brady
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speaking on "squawk box." but it seemed like something else happened throughout the session or would you say his insistence about border adjustment is one of the reasons retailers are struggling? >> i think it's the main reason. certainly a delayed reaction. xrt actually opened up wasn't until that 9:35 and it started to selloff. but retailers are freaked out. it's a controversial tax. i know it is a key part. the issue also is that if it doesn't get past the senate, then they're back to square one because i've heard nothing about a plan b. but retailers are right to be nervous. now, maybe over time it works out for them, but in the short term, i think deservedly so they're nervous and that certainly was a major factor in today's weakness in stocks. >> rick, so what about this reflation trade in reverse. the dollar index is back below 100. then you have gold and sarge
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feels that the gold rally is part of this deflation trade. what do you think is going on? >> i always put gold off to the right because gold is one of those things where there is a lot of aof answers even if you ask one question. i call it the growth trade and i think the dollar index has been odd man out on cooperating with that trio, equity, rates and the dollar, for about a week and a half. so i agree with with peter. first of all, delayed reactions are quite common especially when they involve openings. traders want to see if important news actually makes its way into the market and they want to give it a little breathing room. and they did. about an hour as peter described. and the dollar index right at the same time had already been moving and it started to speed up. so my opinion, you know, ite's difficult to pin things to politics, but i think in this instance it's warranted. but one phrase of caution, and
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that is let's take worst case scenario. i personally think things are going pass. i think this is the legislative process. it's messy. and with regard to health care, if repeal and replace doesn't work, what does that live us with? obamacare. so it makes sense the market would try to aim back into a direction of the past. but don't give up the roost so quickly here. don't underestimate trump. don't underestimate the caucus' ability do some compromising. they won't have a vote if there is not enough. i do like mitch mcconnell's view. let's make the sausage the old fashioned way. we don't need everybody to start out as boards. i'm still opt myself tick about legislation, but it's right to question the market's 5babilityo digest so much without retracement. >> and sarnlgge, the report fro
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allied this morning, forgets washington, but if you just said allied talks about credit quult and wh quality and car loans, look at the collateral damage across the regional bank, you could pretty write the story of the selloff using that. >> the fundamentals aren't all there. look at the cpi, the retail sales. we've overlooked poor data, poor macro and micro economic data for quite some time now on our march to victory. i think it really is the overlying threat from washington. as far as the border adjustment tax goes, wouldn't that be a reason to buy the dollar? now, maybe the border adjustment tax isn't quite the threat we think or maybe they're not going to write it into law. maybe they use it as a hamger, as a weapon in bilateral negotiations between the nations that our president feels have taken advantage of us. and maybe we'll use yit
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one-on-one with china, with mexico, with canada. >> peter, last word to you. so what are we saying? this is a market that had been showing high expectations for policy coming out of washington and they're starting to sense the sausage making is an ugly process or what do you think is going on? >> no question. it's all about tax reform. the market has priced in the perfect implementation in terms of timing and content of a cut in the corporate tax rate. and anything that inhibits the timing of that i think is the reason for this. but it's in the context of an extraordinary run post-election. to have a little hiccup here, anything r. anybody who thought that this would be a perfect process was very naive. >> like the whole market is the answer to rick's line from about gold earlier. you ask one question, and you get four answers. >> thanks, guys. appreciate it very much. we have about 45 minutes to go into the close. dow down 187 points.
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it was down more than 200 a little while ago. declines of 1% nearly for the s&p, 1.5% nearly for the nasdaq and more than 2% for the russell. we'll have much more on the selloff, but up next, former administrator for medicaid and medicare explains why he thinks the american health care act would cut coverage for millions and throw the insurance market into a tail spin. and also still to come, ginni rometty on the company's relationship with china and a lot more.
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welcome back. if you're just joining us, it's the first roughly 1% move either way for the markets in about four or five months. the dow down 193 points. was down 227 at the lows. the s&p down a percent. nasdaq down more than that. and the russell down even more than that. a 2% decline. pick your sector. a lot are lower today. how about biotech? xbi on pace for its worse day since january and that includes the likes of puma, kooite phrma
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among others. >> and let's take a look at health care broadly today. it's also been lagging. all this happening after today's meeting between president trump and gop lawmakers. the sector as a whole down half a%. not bad in the context of what we're seeing. joining us with what types of concessions could get help or support for this bill is former acting administrator for the center for medicaid and medicare services. welcome, andy. >> thanks. >> so we're all focused of course on the passage and does it or doesn't it and how many votes and blah, blah, blah. but what do you think is the better roach for health caappro going forward? >> i think you're right, the closing argument here seems to be about politics. but i think what we're all going to recognize is that this kind of legislation passes once every 7 to 10 years. and so the real question is what
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are we going to be stuck with if this bill passes. and we all know the aca isn't perfect. the question, is this the right solution or should we be doing something more surgical. and the i think things that are clear, a lot of people will lose coverage. $14 million next year and 24 million over a decade. insurance premiums are expect goad up by 15% to 20% next year. deductibles will go up because they're reducing the actuarial value of the policies. so there is a fair number of people saying this is a very difficult vote. we're going to have to make a vote that maybe items what t's president trump and party leaders want, but it will hurt people in my district. 55,000 people per district are scheduled to lose coverage can. >> we all know you're predisposed not to like whatever repeal and replace package they will come up with. we get that and that is understandable. what do you like? is there anything -- for
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example, one on thing that aca was not able to do was to get the young healthy people into the pools there to bring premiums down. and they are are's t trying to provide some incentives or punitive action by making them stay in a plan or charging them 30% if they leave one and go back in. so things like that. are there things in the ahca that you like? >> yeah. and look, my prejudice is simple. it's for the american public. it's what will cover more people and more affordably. and if there are ideas that come from republicans or democrats, it's all the better if we have by bart is bipartisan sponsorship. by getting rid of the individual mandate, which is as popular as vegetables are with my kid, but by replacing it with a penalty, it will only be paid by people who are sicker. so i don't think this will help
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the risk pool. there are things that can be done and some are included in this bill that i think are good. i think having state based reinsurance pools has been demonstrated to bring down rates, increase competition. i think that is part of the answer. >> and i just wonder, after obamacare was passed seven years ago, a lot of people had what we would call normal insurance through their employer felt like all they knew their deductables were goingable, costs were going up, coverage might have been getting poorer. they might have lost -- they were thrown into flux. so while i understand that the number of the uninsured is important. what about everybody else who right now has already dealt with trying to rebudget for all these uncertainties and now is programs starting to look at more uncertainty again. will this improve the situation for them at all? or how important should it be to take all of those people into consideration here as well about. >> absolutely. it's critical.
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and i think one of the things that came out of the congressional budget report is that 7 million employed americans would lose their coverage over the next decade if this bill passed relative to the current state. and we have to remember that over the last number of years, we have had a historically low cost growth over the last -- to give you just one data point, the medicare cost growth per capita has been under 2% over the last eight years and under the bush year, about 6%. so medicare costs always have to goi down, but they have been moderated and people who are getting insured at work have done quite well over the last few years. it doesn't look like it would be as well if this bill passed. >> andy, good to see you. thank you. wish we had more time. this is a critical issue obviously. but thanks for joining us. >> thank you very much. now coming up in the next hour of the show, freedom caucus member congressman mo brooks on why he still does not support
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the republican bill to replace obamacare. about 40 minutes to go. dow down nearly 200. s&p down 23, nasdaq 86, russell down 29. >> apple down with the rest of theting an all-time high at the open. we'll show you the new products they have announced.
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welcome back to a broad based selloff. we're seeing all markets down
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1%, 1.5% to 2%. pick your reason why. maybe items just o's just a day nothing seems to be going right. >> more sellers than buyers. apple shares also trading lower after hitting a record high this morning even as the company introduced new products. josh lipton tells us about the new products and the code word is red. >> well, apple did deliver a range of product updates. refresh ipad called simply the ipad and it replaces the 9.7 inch ar-2. the price has been cut with a basic model starting at $329. also iphone fans have a new dlor choose from,ing red. when kirms buy tconsumers buy r make a donation to a charity. the special edition 7 and 7 plus
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phones start at $749 and are available starting march 24th. and finally it's not just hardware. apple also introduced clips, a new app for creating videos to share through social networks like facebook. apple is showing different ways it can work with a camera and it's also a baby step of tim cook figuring out ar. these announcements do come as investors have piled into apple. the stock already up 20%. in part because invest tour ors bullish on the new iphone expected in the fall. three months prior to the introduction of the last six new generations, the stock has traded positively 100% of the time with an average return of just over 19%. but then traded down following the announcement dropping on average 1.6% over the following foush we four week. back to you. we're headed into of -- code
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word red. market coming back a bit. a leading trader who has been waiting for a selloff will tell us why -- or what he's going to do with the market right now when we come back. also ahead, more from my interview with ginni rometty on and whether she would consider buying twitter.
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selloff across wall street today including stocks hitting a 52 week lows. several retailers with declines of anywhere from 1.5% at target to more than 3% for under armour hitting the one year lows. >> all right. here we go, 30 minutes left in the trading session. well do another episode of the adventures of peter costa. let review. you got out of the market as it was going up and figured it was overvalued. and you were waiting for a
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decline. >> i'd say i missed the top by 5%. >> which you admitted. yesterday you told us that f. we got above 21,000, you would short the market. we didn't quite get there, but now the selloff. now what? >> if you break through, i think the s&p, there is a pretty strong support at 2350 which i think we're below that right now. >> we're right at it. >> if it breaks through any further and you see weakening and a little bit more volume on the close than we've had in the last few days, that is a sign that many there is more going on. >> so you put some shorts on? >> yeah. >> you're short the market right now. >> yeah, i was short yesterday when i was talking to you. but i think there is still more on the down side. i'm not sure that it will be this major selloff. but the reason we turned around is because now there is a problem with the new health care bae bill, that it may not pass.
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>> but you have the financials also. the retailers also lower. that is not about aca. they got their own problems. >> financials i think will have a problem because i think there is -- maybe we won't see what we think we'll be seeing going forward. i think people are getting out of it because of that. >> all right. so short the market. >> yes, i rks , i. >> thank you, peter. >> i look forward to the next episode. . >> thank you, peter. >> i look forward to the next episode.a. >> thank you, peter. >> i look forward to the next episode.m. >> thank you, peter. >> i look forward to the next episode. hi, everybody. here is what is happening. joey meek, a friend of dim plan roof o dylan ron roof was sentenced fo lying. a large crowd of mourners carrying the coffin of martin mcginnis to his home in london dai dairy. he eventually led the movement towards rerk c
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towards rek gone sti towards reconciliation. he was 66. a robot probe obtained photos of sandlike material at the bottom of the vessel at fukushima, but officials don't think it is melted nuclear fuel. and espn reporting a berkshire hathaway employee from west virginia fell one game short of winning a million bucks in the company's ncaa tournament contest. warren buffett was offering the million dollars for anyone getting all 32 first round picks correct. and $1 million for life for picking the first two rounds correctly. the employee picked marquette to beat south carolina in the first round and south carolina won by 20. however, guy, we should note that he did get a $100,000 prize. >> nice consolation. >> a nice consolation. i personally think it should have been more like $500,000. i mean that's not easy.
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>> i'd take 100 grand. >> oh, of course. >> thank you, sue. last hour i spoke with ibm chair ginni rometty and we talked about doing business in china. they just had a cloud deal announced and the relationship going forward between that country and the u.s., take a listen. >> we've been a long standing member in a company that has done business in china for well over 30 years. and in fact have a very good business there and we do business in many of these countries around the world and have very productive relationships in all of them. and so this has really been the announcement has been something that has been underway for quite some time that we've been talking to them about, of how to best bring the ibm cloud into china. considering we're already in 50 data centers around the world and 19 countries, this becomes the 20th. and it's actually a really great
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marriage. those that know they are a company that moves with great speed, has a wide ecosystem. so they will also be a client of the cloud, as well. >> and speaking of partnerships, there is one name out there on the street that i wonder if would make a good strategic fit for you. and it's twitter. any thoughts on that? >> well, key thoughts on twitter, we actually work with twitter as a partner. there is much that you can do both using information there to help clients make better decisions, and then helping twitter as they look a data and making decisions. so really we've had a strategic partnership. >> so that's as far as you're going to take it with that company? would it make sense for twitter to be part of ibm and part of this cognition, this ai and all that going forward? >> i think when you look at just about any business, it's going to be a winner and loser based
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on how they use information. so cognitive will be the future and one of the most important things we do for clients is with their data, be sure we can assure them that their data is their data, that in the consumer world when you look at a lot of search technology, it is all about taking data and disseminating it. some cause that came nka came n it. >> so let me ask you as well, because we talked about how some of the analysts are beginning to appreciate the cloud opportunities. but they still want to know when that revenue growth is going to come back on the top line. 2017, 2018, beyond. and what about profit margins. is there an opportunity to grow those in the meantime, maybe have a higher multiple on your stock price than where it is now? >> yes. well, as you know, when it comes to growth, and i'd ask you to continue to look at those strategic imperatives. it is about growing in many areas. and the areas we are looking to
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grow and key market areas around our cloud, and analytics, we're now 40% ever tof ever the compa. and we're continuing to work on things like the global technology services business. it's had growth the last seven, eight quarters. so you watch that come together over time here. and when you talked about a sign post around profit margins, as we gave our guidance, that would call for an increase in pretax income. so i think we've already put a sign post out there. >> okay. one final question as wats son becomes more well-known, there is a pit fall. for example this issue with university of texas md anderson cancer center that doesn't audit $62 million. they feel they have little to show for the watson partnership. anything specifically there that would explain what went wrong or
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are they just going maef many of these learning opportunities? >> i think if you rid the audit, you would know watson worked quite well. and i think this is a section and discussion around what does it take to implement in any kind of company. and so on watson, the technology worked. and i think one of the learnings for any client to make business process change and transformation is how they run their transformation programs and what they do. so we've had gralt success with watson health. and in fact i go through the list between clinical trial matching, watson for oncology now treating over 12,000 patients, watson for again ogen and watson oncology india, china, malaysia, thailand. and so there are plenty of success flg exful examples and
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proud of the work it's doing. >> ibm ceo ginni rometty speaking with us earlier. we have a news alert on the house of freedom caucus. john harwood, what can you tell us? about. >> we've got bad news for the republican health care bill on both sides.bout. >> we've got bad news for the republican health care bill on both sides.out. >> we've got bad news for the republican health care bill on both sides.ut. >> we've got bad news for the republican health care bill on both sides.t. >> we've got bad news for the republican health care bill on both sides.. >> we've got bad news for the republican health care bill on both sides. >> we've got bad news for the republican health care bill on both sides. i got off the phone with a source who said we now have 25 hard nos among our people, two more lean nos. republicans can only lose 21 members of their caucus and get the 216 they need to pass that bill on thursday. now, most of those freedom caucus members are meeting and talking individually with president trump. but the source says those meetings are not changing many minds and they believe that those will hold. if in fact is the case, freedom caucus may come out with a normal statement of opposition which could cause the bill to be pulled from the scheduled thursday vote.
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interestingly, sean spicer at his briefing today said the vote on the bill is currently scheduled for thursday. that is currently. could change. on the other side of the capitol, you've had mike lee conservative from utah who previously expressed a lot ever doub of doubt has now said he is a no. i talked to a republican senatof doubt has now said he is a no. i talked to a republican senator who says we have two firm nos and we can't lose more and now this makes three. so it doesn't mean they can't resolve some of these problems, but very big troubles in both chambers right now. >> we can simply look at the market reaction here and the dow now down 225 points. i believe a session low. so on clearly the street is following this pretty closely. john, thank you. speaking of sean spice, eamon javers questioned him about the selloff at the press
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briefing. what did he have to say there? >> yeah, that's right. this is a white house that has talked in the past about those stock market rallies being a real time barometer for their performance, report card for how the white house is doing. maybe not so much on a down day. i asked sean spicer about whether the president views today's pull back as a reflection of how he's performing as brd president tof the united states. this is his answer. >> to look at any one day is we've always cautioned. i think overall it still continues to be up tremendously and when you look at not just that one indicator, if you want to get -- you probably know better than anybody in terms of what you guys cover that you can't look at one indices and say that is the benchmark of an entire economy. >> and that is traditionally what you hear from white houses. markets go up, they go down. they don't want to comment on individual days or stock market
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gyrations. but this is what gary kohn said on cnbc earlier this month when he was asked about stock market performance. >> the stock market is a barometer. the nice thing about the stock market, it's a fairly real time barometer, so we do look at it about that. >> so a real time barometer, but spicer saying not so much. this is something that we don't want to look at in isolation. you want to look at the broader market elevation. back over to you. >> thanks. see you later. 18 minutes to go here. dow down 229 points. lows of the day. s&p down 28. transports down big. the dollar is down big. it's below 100. interest rates are lower. nasdaq down 101 points right now and russell down 33. >> are vevery interesting day. lock on heed mheed martin down would.
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but still showing off its latest weapon systems and space initiatives for the next generation of defense and we'll have a live report when we come back. your path to retirent may not always be clear. but at t. rowe price, we can hp guididyour retirement savings so wherever your retirement journey takes you, we can help you reach your goals. ll us or your adsor t. rowe price. invest with confidence.
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so what else is new? umm..she's doing good. she needs more care though. she wants to stay in her house. i don't know even where to start with that. first,et's take a look at your financial plan and see whate can do. ok, . wel lien. we'll talk. we'll plan. baird.
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selloff day. the dow setting lows right now down 236 points. the s&p down 29. yeah, everybody down more than 1%. and look at the russell, down
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2.5%. a lot of traders watching. >> and reduce sell now in tusse for the year. and lockheed martin stock fueling, but the company is full steam ahead presenting new technologies. and its ceo spoke with morgan brennan. morgan joining us from washington with more on what he had to say. >> that's right, so long heat martin chairman and ceo talking growth, innovation and of course president trump saying this past year was one of the most complex volatile geopolitical environments of her entire career. and that she's lockheed's growth process penkts. so in an interview with me earlier today, he's been saying from her perspective, it looks very positive that proposals for more defense spending moves forward. she's also hopeful that sequestration is eliminated. in remarks this morning, she noted a trump effect on nato
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members vowing to beef up funding. on the fighter jets, houston saying president trump quote absolutely made a difference in negotiations of the recent contract putting a, quote, sharper point on price. but also noting that he hasn't been involved in the newest contract negotiations which are expected to be wrapped up this year. a big focus on international business as well with lockheed on track to grow international to 30% of overall sales over the next several years. more than half of the f-35 sales that are expected over the next five yearses are expected sbesh nationally. they are expected from allies. so as you mentioned, shares down 1%, however they are trading near record highs. the last thing i'll tell you, houston also noting she expects 3% to 5% growth over the next cu couple years. >> great stuff. and transports some of the worst performers today. a debate on whether this is a dip worth buying when we come back.
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sxwrooirnl
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. as we head to the close, according to art cashin, sell side $450 million and i think we've seen the impact. let's look at some of the stories moving stocks today. they have been down sharply. a myriad of situations going on today. worried about the gop health care plan play not pass and in turn could delay the anticipated tax cuts promised by washington. the financial sector has been a laggard today down over 2% as interest rates move lower. and transportation stocks getting hit hard as fedex gets ready to report earnings after the bell. speaking of the transports, they have been lagging the broader market late so far this year. down about 1% while the s&p was up about 5% going into today's session. >> maybe that is an opportunity. is now the time to be buying the transports?
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joining us jeremy hill and david dietz. good to have you both. and jeremy, what do you think about the transports? >> well, we have a bit of a moderately buld lilish view on company in the freight areas. the big ones. fedex as well as u.p.s. we think they have specific roenls to be bullish. but also more thematic reasons. so lower gas, oil prices. high adoption of technology. and also these companies are extremely leveraged to the gop g gdp. so that is bullish for these companies. >> we have a market that is overvalued fp over valu valued. we have interest rates going up. so is this the time to go into high beta commodity transports, very cyclical?
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it's all dependent on the trump policies which seem to be fading by the hour. republicans can't enrepeal obama care, what luck do we have to have the tax cuts. >> i would make the argument that actually the negative of the trump policies -- policy risk, political risk and economic risk is already in essence priced into the market to a certain degree. we've seen a little bit malaise and pause recently. and if you look at a company like ubs, you can buy did cheaply today. and that is a company growing its top line revenue by 13% over the last 12 months. >> i certainly hope that a 3% or 4% pull back from all time records is the worst damage that we'll get and then i'm with you. but i'm afraid it could be more. and look at some of the business models. you can now fly from europe to
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the east does fcoast for $65 onn air. >> but i'm talking about the shippers. that is a different sector. >> how is that border tax going to work for the shimme ersshipp? >> not very well probably. >> what about fedex? i guess you don't like that one? we're getting ready for the earnings. >> we'll know a lot more after the earnings. my concern is they bought tnt last year. that is exposed to europe. how is that european economy doing for you. if there is a stronger dollar, how will that work for them. >> i would not see a stronger dollar right now. i think that's a great thing for companies like delta at 67% of their sales is dollar denominated versus other airlines. so you can splay tcan play the but i think there are nuances with each company. >> great conversation. fun to watch. and informative at the same time. good to see you both. we'll come back, we have the dow continuing lower down 235.
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and we'll have the closing countdown. >> and after the bell, fedex out with earnings. we'll break down the results. introducing conduent. one of the largest business process companies in the world. whether it's in health care, customer care, technology, transportation or government. we touch millions of lives every day. conduent. advancing the everyday. we cut the price of trades to give investors even more value. and at $4.95, you can trade with a clear advantage. fidelity, where smarter investors will always be.
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last two minutes of trade here. so how many people have been waiting for a selloff for some kind? we get one and there are a myriad of reasons out there. the dow opened higher this morning up 64 points. and then it sold off after the first hour of trade. and we're near the lows of the session right now, down about 234 points. the dollar has been a laggard. even as the fed raises rates. that has been a conundrum, talking loud here for the last couple weeks and we're now below 100 on the dollar index. so if the dollar goes lower, oil should be going higher, right? it's not. production cuts are not kicking in. too much production from the u.s. so wti continued lower. we're at 47.50. yields moving. selling stacks, buying bonds right now. the opposite of the reflation trade. so the yield now on the ten year is at 2.42%. what is going higher interestingly is the price of gold. that is now up to, what, $1244.
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>> and that has been moving. an interesting stew. we have anxiety about the lower bond yields and the weaker dollar, banks are getting killed again. we have anxiety over the trump agenda, they're worried that they may not pass the house bill, the repeal of obamacare on thursday. a lot riding on that because that clears the path to go ahead and deal with tax cuts. and then fine allegation we'all fundamental issues. oil lower. and also weakness in the autos, as well. >> yesterday at this time there was a glitch on the pricing of etf and i assume they have that worked out. >> monitoring it all day and seems to be fine. they tried on the electronic trading. but everything seems to be operating as normal. >> so we have the selloff, worst day of the year for stocks in 2017. we'll talk more about that coming up. and fedex earnings also on the
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second hour of closing bell. i'll siee you tomorrow, kelly. >> thank you, bill. welcome to the closing bell oig. tough session today. let's get right to the numbers. dow drops 238 points. that is a decline of more than 1% for the blue chips there. goldman sax among the very worst before s&p 500 down 1.25%. and by the way look at the dow, under 20,700. we were just above 21,000 not so long ago. the nasdaq now today giving up 1.8% after hitting all-time intra day highs not just yesterday but also this morning. so a big reversal. and the russell 2,000 with a decline of 2.75% closing at 1346. that is putting it in the red for the year. 1357 we're well below that
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number. 10 points below in fact. we'll have more on this in a moment. health care the catalyst for part of the soefl aelloff and c up, congressman brooks tells us why he will vote against his party's own bill to he radio place obamacare. joining me today is michael santoli,radio place obamacare. joining me today is michael santoli, and also michael from destination wealth management. and welcome one and all. mike, maybe we don't need to have one story for every selloff, but today there certainly seemed to be a couple different things going on. it was hard to argue that the way things took a turn for the worse was the nard difference out of washington into the close didn't have something do with us closing at the low. >> at minimum, you could say it didn't help. it doesn't help that you may have a stalled agenda in washington. if you were really buying into the market because you felt as
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if i can tolerate today evaluations if we're going to get policy help in a few months. and all of a sudden this muddles it up, sure. but i've been arguing against the idea that it's all about policy. so i don't think a 1% pull back is all about unwinding. but you've had klum la difference things going for a while now which is some of the more cyclical parts of the market have been declining for a while. you've had other parts of the market keeping it assumesupport. it seems as if we had pent unselling. we got a lot of it flushed through. we're a little bit through the bottom of the range. we'll see if there is anything that follows behind this in terms of more selling. >> and michael, what do you read into it? you're on the winter storm
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coast. you're not in washington. maybe some fresh eyes on what is playing out here. >> are silicon valley is very optimistic, so i don't think there is a tremendous amount of negative sentiment inserting into the market just with a one day selloff. why is it down? who knows. in all likelihood, something do with policy. i don't necessarily agree with that, but i think polliicy does have something do with it. a perception that health policy isn't going well. but i've been saying for a while that the market is not cheap. it just you means you're defensive. and i think some of the names that have been defensive and unloved i think will come back into favor when the market starts to get more volatile. >> and jeff, the other thing that happened today that i find interesting, allied gives a profit warning and talks about how suddenly used car prices are dropping. that means finance companies
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have to put up more provisions against lawsuits for example. kind of ripples through. and that includes a lot of the banks. is it possible if the financials were the first to crumble this morning that it might all come back to this even though i know jamie dimon addressed it and said the car industry is not systemic. but it does arguably with v.hav impact. >> that allied bank news came on top of a story that i read at 5:30 a.m. that said americans to some degree have stopped making car payments on their auto loans. so that was piling on with the allied bank story this afternoon. but i think the real cause of today was when president trump didn't say that the health care bill was a slam bunk going to pass. i would tell you that our models turned negative the last week of january and up until today, that has been wrong footed. but i still stick with the models and i think you be
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cautious here. >> you had gop rep dave brat oig saying the health care bill wouldn't pass, senator cotton saying he still can't support the house bill.ing they're not slowing down. and schumer saying dems would help if repeal is off the tai l taishl. a ju it just goes on and on. it almost reminds me of t.a.r.p. the billing wasn't going to pass but then it was systemic. >> here's what it reminds me more of just because of magnitude which is the fiscal cliff debate in 2012 after the 2012 election. it was exactly like that back and forth, back and forth. you had a defined deadline. but here is the irony of that. 2013 was a wonderful year for the market. it happened after enforced stalemate, gridlock in washington. nobody wanted policy progress. you could make up whatever story line you want for what the market is supposed to be doing. i think it definitely has a
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psychological effect and has had that. but i'm not going -- look, a 1% down day is not unusual. 109 days without one is unusual. >> all right. president trump reporting that increased pressure on republicans who aren't supporting the gop health care bill. kayla tausche has more for us. >> all you need is 21 defectors in the house from the republican side and this bill does not go to a vote on thursday. and by at least two counts this afternoon, one by nbc news and one from our john harwood, that number is currently above that. so hence why you saw the president this morning turning up the heat on republicans raising the stakes for those considering against it and saying it would likely cost republicans the majority in 2018. asked today about this, sean spicer asked whether the president would actually go on the campaign trail and stick to those members who are going to vote against the bill for ideological reasons, the press secretary said this.
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>> one of the things that he made clear this morning was that he was going to make sure that the people who did support this, he would be out there supporting them. and so i'm not going to focus on the neglect tifrl as much as the positive today. >> one right leaning group is campaigning directly against the bill, that is the club for growth which espouses tax cuts and free markets. airing ads beginning today calling to reject ryancare. of course there is still time for compromise before that thursday vote, although there is very little room for error. senate majority leader mitch mcconnell says he hopes to pass it out of the senate by next week. of course that is an incredibly tight time line even before we've seen a revised cbo score and what the house will be voting on on thursday. but case in point about compromise, we ran into mark sanford, member of the house freedom caucus. and i asked him if he would support the bill and he said i'm not there yet. the operative word, guys, being
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"yes." "yet." >> still 48 hours, but people not giving them the benefit of the doubt.>> still 48 hours, bu not giving them the benefit of the doubt. next hour, congressman mo brooks will join us and explain why he can't support the bill as it is currently written. that is coming up. all right. so what do you do in this environment? if the policy stuff matters that much in the long run, maybe there is trouble, but if it doesn't, is this a buying opportunity? >> first of all, we need to focus on what is happening in the bond market right now. because a lot of investors have their significant portion of their net worth in fixed income. and what happened last week? the fed raised rates and bond prices went up. the yield went down. so the bond market is saying
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they're not as hawkish as programs some fed watchers are that the fed is necessarily going raise rates. that is a positive for equities. and frankly, a positive for fixed income that probably oversold on anticipation of strongly increasing rates. secondly, i don't think it means you bail on equities. you watch the growth equities, market drops 5%, 10%, those are opportunities. in the meantime you're in defensive names, you're buying differ denied orient dividend oriented assets. >> do you agree, jeff? it. >> yeah, i think we're in a long term bull market. i think it has years left to run. talking to people inside the beltway, they are quite concerned about north korea and the other thing that happened here recently is this thing about not bringing computers in from certain countries in the inside cab in-cabin and i think that pled through into the
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market, as well abo. >> good points. thank you for joining us.pled ts well. >> good points. thank you for joining us. just going back to this point about what is happening in the car sector, even if the cycle is turning, do we just figure out the web of who is connected with that? >> and also a reminder that the credit cycle, whatever you think in terms of the position that we're in, the comprehended cycle has been rowing for a while about that and starting to fray a bit. you saw the experian numbers on bank defaults has been up, too. it shows you there is a little bit of restraint on the consumer end, a little bit of worry. >> yeah. and i just saw as well autozone says they're doing a buy back. so perhaps they are saying --
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>> autozone bought back more a third of its shares since 2010. so you have to figure that when the stock is down a lot, they won't quit that. >> stocks selling off today on wall street on renewed worries that the republican health care bill may not find enough support for before thursday's vote. and here are other stories we're watching. william dudley says banks still have a long way go in reform internal culture. dudley says the wells fargo fake account scandal shows performance driven compensation remains a problem on wall street. and president trump signing a bill funding nasa for nearly $20 billion for the 2018 budget year. and setting a new goal of sending humans to mars. that law directs nasa to come up with accrued mission to mars sometimes after 2030. talk about big picture xwogoals. and lae and crops could be delayed because of record rains and that could mean shortages and higher
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prices. california accounts for a majority of those crops during this time of year. as i've been wondering about the great spinach outage at whole foods and i have no idea if this has anything do with it. >> you don't know if it's at whole foods only? >> i went to different supermarkets to get it. perhaps it's just extremely popular. >> any grow a lot of spinach in mexico. >> i have no idea. we'll try to get to the bottom of it. invest aors getting ready for resultsnooik beingky. we'll have coverage. and plus stocks selling offer on concerns that president trump may not be able to convince enough republicans to support the repeal of obamacare. how to invest in case the tax reform plan is pushed further down the road.
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welcome back. an ugly session on wall street today. the dow dropped 237 points. s&p down 30. transports down 170 points. small caps went into the red for the year. here is a look at some of the
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decliners on the dow in particular. the biggest losers, goldman sachs was down nearly 4% today. financials broadly got creamed. caterpillar down more than 3%. jpmorgan down nearly 3%. due monpont down 2%. and we have shares of nike slightly higher. we're awaiting the dwaurdwaur y numbers. stacy, it's been a tough climb lately. >> it's been very tough out there. and one of the safe havens if you will has been the footwear cycle and we're starting to see signs of that really hit the wall. i think the biggest number that everybody is looking for is last quarter of future orders, the big indicator of what will happen. we're only 2%. >> yeah, i was just going to say, we're starting to get this in. sarah has the full report now. >> big beat on the bottom line
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for nike. 68 cents per share. estimate was around 53. but overall revenue number a match. revenue at $8.4 billion, that was just what analysts were looking for. they were looking for $8.47 billion. just to pull out a few numbers. and keep in mind nike doesn't put futures orders in the release anymore. we'll talk about it on the earnings call which comes out in the next hour or so. so we'll get you those numbers as soon as they cross. we don't have them. gross margin of course people look at this with nike, 44.5%. that came in just a little light of what analysts were looking for at 44.8%. inventories has been a big deal because remember last quarter was a little disappointing that inventories grew faster than sales. inventories here it looks like were up about 7%. so matching sales growth. it looks like overall pretty in line quarter. i have to figure out what the big bottom line beat is all
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about and we'll give you the futures numbers on the call. a few other things to look out for, commentary around partnership, they have their big deal starting this summer, a brand new line with drake. of course they're trying to keep up with competition. adidas has had a resurgence in north korea and has kept nike on its toes. so 7% revenue growth is certainly an improvement from last quarter. is it enough keep in-vevestors satisfied? it is one of the best after being the bottom of the list last year. >> a litany of things nike dealing with. shares look a little higher right now. but in the meantime, fedex results have just come in and let's get to morgan brennan for those. >> so a miss on the bottom line, $2.35 per share adjusted for fedex. that is versus estimates of $2.62. revenue $15 billion even versus $14.99 billion.
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so in line there. the company also reaffirming full year earnings outlook. 1185 to 1235 per share excluding tnt. a few items of note here, the company saying operating results were impacted by the significancely negative net impact of fuel and one fewer operating day of fedex express and fedex ground. also fred smith, fedex founder and ceo, saying that our worldwide fedex team delivered an outstanding peak season, highest volumes ever. they achieved record service volumes keep in mind these are the results for peak holg diday season. so miss on the bottom and in line on the top and reaffirming full year guidance. >> and those shares down nearly 3%. we had our debate on whether it's a good buy. it's bean a tough day for the transports. in fact they have been lagging all year. interesting with the fuel issues, more of a boost from that perhaps if you're fedex.
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>> are as opposed to the core airlines. fedex has held up a lot better than the broad trance for the index. so maybe give a little bit back right now. but it didn't seem like an alarming move. didn't seem like it's necessarily a mccrow teack macrt is going on in markets. >> let's go back to nike now. stacy, i guess we won't know the futures number yet. we'll find it out on the call. but what do you make of the quarter so far? >> yeah, the good news is that it sounds like inventories are in line with sales. they're up about 7%. last quarter they were up about 9%. so that is moving in the right direction. margins were expected to be down over 100 basis points. sounds like that is pretty much in line. and again, we were looking for mid single digit revenue growth. and that sounds like it was slightly higher. so that should drive the stock also. there was a short positioning increasing into the quarter, a
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lot of negativity around it, but i still think you really want to watch out because sometimes being the dominant one in the north american market with 60% share when you have somebody coming after you, sometimes that is not an enviable position. >> i'm interested in how that sneaker works when they do the two hour marathon run in a month or two. in any case, stacy, thank you. appreciate you staying late with us. >> the concerns about the health care bill being in jeopardy were weighing on stocks big time today. and joining us is representative mo brooks in alabama, a member of the freedom caucus. he thinks the gop bill is in serious trouble. congressman, thank you for joining us. >> my pleasure. >> so the president has appealed directly to you to say support this bill please or else you will lose basically. what is holding you back? >> well, i didn't interpret the president's message to be that way. if we're going to get to the details, you can have a major
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loss politically sometimes from passing bad legislation just as you can from failing to pass good legislation. in this instance i believe that the legislation is bad in a number of different ways primdly in that it creates a huge new welfare program where taxpayer dollars are being used to subsidize insurance companies and over the long haul that will result in either higher premiums or higher taxes our greater debt that will burden our economy for decades to come. so i'm looking lon teg term. and until we get away from the federal government supposed to solve all solutions not taking into the account the cost of it, it's very difficult to be for a bill that i know long term will do great damage to our country. >> congressman, does it seem like the freedom caucus is coming to that conclusion? john harwood reported last hour there might be a statement put out for example of withholding support for this legislation.
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>> well, as ever thof this poin in time, and things are flid, there are enough con sefshl differences left in the house of representatives to where this big government big welfare program cannot pass. bearing in mind that it's very difficult for me as a conservative and as a republican to wholeheartedly get behind a bill that is the largest republican welfare proposal in the history of the republican party. and for someone to think that we should just lockstep jump behind that is puzzling to me. >> understanding your stance on that basically as a matter of principal not wanting to get behind a move like that, you have others from the other kind of end of your party that have objections from an entirely different direction. so in other words, under what circumstances would you imagine that you would actually have enough votes to have some kind of a replacement for the aca that somehow it is not necessary also make allowances for the other side? is there any way to see clear to
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a point where you can find a bill that would suit what you think it should be? >> you hit on a key point and this key point is we have a lot of liberals that you send them to washington, d.c. to get in the house of representatives and all of a sudden it's difficult to distinguish them from democrats. that having been said, what i think we should do is we should repeal obamacare. that is something that we committed doing. that's something that we had the votes do in the house and senate just a couple years ago. and then we k. hacan have a vig debate. we should interject competitive efforts so that insurance companies have to com on pete so that health care providers and insurance carriers are not exempt from antitrust laws. and then as much as possible shift this health care issue to the 50 different states. for one reason, if nothing else,
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the states are more sal vents th solvent than the federal government is. the federal government is headed toward bankruptcy because of this $20 trillion in debt that we've accumulated over the decades. coupled with the cbo projecting that within six year, we will hit trillion dollar a year deficits adding on to the debt that we already have. until such time as our economy collapses. we have to stop that from happening and that's what i'm trying to do by opposing this legislation. >> yeah, we've been seeing incredibly low government borrowing rates and saying okay, pretty long leash that they have been given here. let me -- >> let me emphasize one point. >> i understand. but let me just ask you this because it goes to what happened today on wall street. so the market is dropping. because it's worried the health care bill won't pass. a lot of invests probably feel the same way you do, but they're worried about is the whole agenda stalled. if we don't do health care, we don't get the whole sort of
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platform that the president maybe came in on and everybody was so excited about and now feels like it has stalled entirely. what if 245 happens? is is it worth holding everything up? >> to me the stall argument is a fiction. there is no substance behind it. we could be dealing with tax reform today if we wanted to. there is nothing that prohibits us from doing that. further, if this largest welfare program in the history of the republican party were to fail on the house floor on thursday, well, hopefully we will immediately go back to the bill that we already passed in the house and senate two years ago and that is the repeal of obamacare. so we can very quickly address these issues provided we get enough people who can coalesce behind what is best for the american people. but i do on want to emphasize that one point that was just made about interest rates being low. that is a good thing. but the cbo is projecting that our interest rates onnen a annual basis are going to increase in costs by over $500 billion over the next decade. and i think you saw a little indicator of that a week or so
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ago when the federal reserve increased interest rates by a quarter of a point. now, granted that's not the same thing as what the federal government is having to pay to borrow money, but if that impacts our borrowing rate, that quarter of a point all by itself costs us an additional $50 billion a year on a $20 trillion debt. that is how serious this situation is. >> final question and we'll let you know. but do you think that the ahca then is effectively a dead bill as far as you're concerned? >> no, i don't because the president and house leadership are working very hard to twist some arms and try to get people to change positions. as of right now though, the conservatives left in the house of representatives, wire fighting to try to make this thing financially responsible to not undermine the work ethic, to not increase taxes, to not increase premiums and all these things, these bad things will happen if this bill passes. it's just a matter of time before those bad things kick in and do the damage to our economy and our country that they are
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going to do. >> all right. representative mo brooks joining us this afternoon representing alabama thank you so much. we have breaking news. let's get straight to seema mody. >> cke restaurants has selected jason amerimarker as their new executive office. this is in conjunction with andy pozner's departure who served as the company ceo since 2000. this is cke, parent company of hardy's and carl's jr. >> and my thought is that he will not belabor secretary. it's not like he's stepping down to do that. so whatever has happened throughout that process, he's 66 years old, he's now resigning as ceo of the restaurant. >> and you don't know if obviously the board of the company had to prepare for the prospect that he was going to leave to become labor secretary and of course there was not very good press surroundinging h his.
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so maybe it seemed an opportune time. >> a big management change. the dow and nad contasdaq had t worst day on concerns that the tax plans could be delayed. coming up, we'll discuss whether this could be the beginning of the end of the trump rally. the end of the trump rally. moved upstate because i wainterested in building a career. cameo ibm to me global clients and big ta but i found so much more. ♪ ) it's really a melting pot of activities and people. (applause, cheering) new york state is filled with bright minds like victoria's. to find the companies and talent of tomorrow, sear for our page, jobsinneortate on linkedin. we're drowning in information. where,n all of thiis the s?
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welcome back. time for our cnbc news update with sue herera.
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>> here is what is happening this hour. on capitol hill, supreme court nominee neil gorsuch continuing his testimony before the senate judiciary committee and telling senators that he keeps an open mind when issuing his rulings. >> everybody wants a fair judge to come to their case with an open mind and decide it on the facts and the law. one of the facts is the basis of precedent. >> the fda says women with breast implants may have a very small but increased risk of developing a rare cancer called anti-plastic large cell lymphoma. but with an estimated 5 million to 10 million experts say the known cases are too few to say that the implants actually cause that disease. and the giants have hired barry bonds as a special adviser to the team's ceo. he will represent the organization at community events
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in san francisco and also work with young players on the minor league level. you're up-to-date. i'll send it back downtown to you. >> sue, thank you so much. financials were the hardest hit sector. joining us to discuss whether this could be a buying opportunity, marty mosby and dick beauvais. guys, thank you for joining us. and marty, before i guess we get into whether the financials are a buy, why do you think they were hit so on hard today? >> this market has been perception driven are. in the last week we've had some hits to that perception. and we've been waiting on fundamentals to kick in and start to improve to create some justification for the positive moves that we've seen so far. the rate hikes that we've gotten in the last two quarters will begin to improve fundamental, but we won't see that until earnings in april and july.
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>> and you're buying some of the regional banks here? >> yes, because we consecutive quarters that can generate revenue per share growth close to 10% and what we'll look at a full percentage point in improvement as the benefit from the rate hikes begin to come through the bank's balance sheets. >> we have huntington's one of your picks. it was down 6% today. we'll come back to that. mr. beauvais, what do you think about the banks? >> get out. i think that basically i love banks longer term, i love them for 12 to 18 months. but next six months, if you want to own banks, you want to lose modern. the congressman gave you a strong reason. basically the united states is wro broke and likelihood of a tax cut this year is nil. likelihood of a stimulus package is nil. there is no likelihood whatsoever that this congress is going to pass deregulation for
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big banks. they will fool around with the volcker rule and small banks. there won't be any deregulation. next, business stinks. loan losses will increase in not just autos, but also in a series of other places like credit cards, student loans and commercial real estate. so what you're going to see is a bufrk of sto bunch of stocks which are overpriced dealing with very difficult full fundamentals when the big broader issues which can is supposed to drive them just won't be there. >> are what would you say to that, marty? in your setup, you say the fundamentals would have to come through. and aside from yields going up, what other fundamentals at this point in the cycle would be improving for banks? >> right now the expansion of the margin that the banks can recreate possibility from their deposit bases is the biggest catalyst left in this recovery.
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you get the biggest bang for your bunk in the first 100 basis points and we just had 50 of those 100 in the last two quarters. so that expansioncnk in the fir basis points and we just had 50 of those 100 in the last two quarters. so that expansionk in the firsts points and we just had 50 of those 100 in the last two quarters. so that expansion will be the catalyst that begins to create a little bit more of a floor underneath this perception and earningly some upside potential for some of the banks that especially have strategic development and momentum like sun trust or huntington. >> dick, i wanted to ask yyou since you brought it up, what has been happening with with the loan volumes? they have fallen offer of late. >> not just commercial and industrial loans. every major category of loans has been falling off. commercial and industrial loans are doing less well i guess is the word because of the energy sector fp ener sector. energy was driving it for a couple years and now you're not putting a lot of money in that area. you can't do highly leveraged loans because the federal
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reserve won't let you. the mortgage business is broken. you don't have a secondary market functioning properly. and you've gotten at this times below that like the qualified mortgage rules which create problems. you have rotten loans being made in the auto industry, so difficulties there. cap rates are no good in the commercial real estate sector. so you have problems everywhere. >> i think i'll go crawl under the table at this point. i take pity on these guys. marty, dick, thank you both being here. today selloff may stem from concerns about the approval the acha and it could impact tax reform and other issues. up next, two stock pros size up how the market dominos could fall. ♪(music plays)
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♪ heigh ho heigh ho ♪
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♪ heigh ho heigh ho it's off to work we go here's to all of you early risers, what's up man? go-getters, and should-be sleepers. from all of us at delta, because the ones who truly change the world, are the ones who can't wait to get out in it.
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lets take a look if you're ready for it. the dow down 237 points. s&p was down 29 as you can see. the nasdaq down 107 and the russell down 37. so declines of anywhere from
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1.25% to 2.7%. a domino effect has found its way from washington to walling street as the new gop health care bill seems to be faltering in congress. and if health care stalls, investors fear tax reform could be in danger as well as other legislation markets. for more on what that means, we're joined by tony shearer and andy capper. andy, are you worried about the dominos? are we all just beholden to the legislative process? >> i continue doing bullpen lislis bullish. i think we've given washington too much credit for the rally. so let's not give them credit for today. washington has a lot of things potentially in the pipeline. the stall in the health care bill not really surprise. we really shouldn't be surprised that the market is taking it on the chin today. but really is it washington that has caused the 10% gain in stock prices so far since the election?
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absolutely not. >> you sound like you've been listening to michael santoli. tony, what about you? >> well, that is what it's been is the yelleden and fmoc show and all about the rates and what that means. and the floot eat end ever thof. we view the main game as being what the earnings powers will be of the companies that we own in our portfolio and broadly speaking. and we think that will be far stronger than what people are assuming. so we remain bullish. you want to keep that wall of worry intact in a bull market. this is only a couple day event. we don't know how long it will persist, but we continue to be bullish. >> we're talking to two bulls. about this segment. >> and after we got to very elevated levels, we didn't work that off. below the surface, we have been talking about this, a lot of
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stocks have come in fair amount. and so i don't necessarily think that the overall market has to be a blood bath to reset expectations. i do think the question is maybe to andy, you talked about as i degree with you, it's not mostly been about policy, but maybe we're just having yet another one of these first quarter maybe the economy is a little shrug issui slig sluggish at the moment. yeah, earnings may come through okay, but mar get ket is up 10% earnings are down. >> markets never move in a straight line, so it makes all the sense in the world that we're having a little bit of a pull back. in the absence of good news, markets will fill any vacuum of worry. >> so andy, citigroup, comcast and intel are your picks. >> so not that i will pick the worst sector every single time, but citigroup is interesting because things are moving in their favor. let's forget about deregulation.
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that might not happen quickly. what else is favorable for citigroup. it's higher interest rates. big money center banks like citigroups, like schaub and northern west, they have been underearning because they can't make any money in interest and finally short term rates are meaningful again. >> and you also tony like the financials along with health care. >> you know, health care as a group continues to be a political football i guess tossed around and no one believes that their earnings will be as strong as what we think. so we do like those areas. we own express scripts. it's a lightning rod about what people think is wrong with the health care system. and we think they're actually the solution to managing price and getting more products available to more customers. >> glenn greenberg told us that last week, as well. guys, thank you so much. up next, we'll tell you what
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is putting some snap in snap's shares. and more on fedex and nike. but i never imaginededhat i'd be playing in kansas city. whthey would talabout kansas citykansas like... i can't wait to get out of here. through the years we lost over 30,000 people. we turned that obscle into an opportunity. the spdway w the catalyst... beuse of the sedwawe now ha a shopping ea ana nderful socctadium. and now w' starting to grow population. it'extremely important to have financpane sucas citi® who believe in that same vision. this area is now a destination there's pele that come out here for entertainment. there's peoplehat come out re to work...to raise families.
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while the obamacare repeal battles its way through congress, the personal health investment today act would allow physical fitness activity to be considered a qualified medical expense and it is trying to pass, as well. herschel walker joins us next to discuss it. and be sure to catch the new episode of the deed. sydney torez tries to recent could you two crash strapped developers. that is tomorrow night at 10:00 p.m. cuse me, a you aware of what's happening rit now? we're facing 20 billion security eventery day. ddos campaigns, ransomware malwarattacks... actually, we just handd l the priority thrts. you did that? we d that. real. we analyzed millions of articles and ports. we can identif threats 50% faster. you can do that? we can dthat. then dthat. can weo th? we can dthat. i'm vests as a vested investor in vests i invest with e*trade,
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the american health care act is taking center stage in congress. but advocates of the phit act will be in play tomorrow.
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the event brings together sports celebrities who advocate using pre tax medical accounts to offset costs related to sports, fitness and other-related activities. h hershel walker joins us. thank you for being here. >> thank you for having me on. >> i'm able to put pre tax dollars, like a flex spending account or something. and that would cover my gym membership and things like that? >> we're trying to talk about gym membership but a little bit more. also, trying to do different things with kids, they can things that they're doing. now it's pay to apply and most kids aren't getting the exercise they need. i've been talk about, we have to talk about preventive. we are talking about all this health care. what about preventive? the way we can prevent a lot of things is start young. >> a lot of people are scared to
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have their kids playing football, for example. the numbers have dropped a lot. they're right. look at all the people who have come forward saying they have issues. >> it's not just football or kicking a soccer ball around. we're talking about exercising. one of the problems we have, and it is a sad, sad situation. we're the best country in the world but one of the most obese countries in the world. we talk about obesity, you talk about diabetes and different times of health things that we have to overcome. that will only happen through exercise. >> those trends have been in place for quite a while in terms of of obesity and diabetes and the difficulties getting kids to exercise. when i was a kid it was in front of the tv all the time nouflt i wonder if it is the focus on
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video games. i wonder if it is the idea of trying to promote the idea of having kids do more physical activity. >> we're going to have a lot of sports manufacturing people. they're not here to sell their products but to say, there are other ways to get kids active. if kids want to sit home and play a video game, they're not going to, we want to get them active. you don't have to play football. you can run track, you can dance. you can do different things to be active. a fat kid is a fat adult. not only talk about the kids but then go into the adults where you can get a gym membership and exercise and maybe a write-off for going to that gym to encourage female exercise. >> this better not encourage my gym to raise their membership
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fares. anyway. you support this president and you've known him for decades going back to when you played in the football league and he was involved. do you have any thoughts at this point about how it's all going? i nag blow back for you has been huge. it's probably cost you business deals. >> it has cost me a lot of business disease but ieals. i am going to support donald. this is best country in the world and it is sad, sad, sad to me to see that we're separated. we're separated pause we had an election and the selection over. if it's over, it is time to move. on support our leader and then next year you can vote him out. if he does a terrible job, vote him out. we haven't even given him time to even elect his cabinet and we're already protesting against him. we need on forget with the elephant and the donkey and do something for the people. >> have you changed any hearts
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and minds about this? >> i have changed some. as a guy, what's so strange, donald had different ideas but we don't know if they're going to work. and most of all i think people have to think about what donald says. he has elected some good people in the cabinet. you hear them talking about, this guy doesn't get along with donald is that donald elected him. well, donald listens. he knows he doesn't know everything. he will listen to his people in his cabinet ask i think that shows signs of a good leader. and it shows signs of a good leader because most every leader who has come from another country has sat down with donald trump. and they've had a different view of it. that shows he can win people over. he is not like that guy you see on twitter all the time i love to see him start tweeting some things but i know as he good man, i know he'll be a good president. we have to give him time. >> we have to let you go. how many consecutive push-ups can you still do? >> right now, probably drop down
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and give you 250. >> 250! oh, man. i wish we had time see that. i could give but two and a half. thank you for being here. that's hershel walker. >> on "mad money," find out at the 5:00 p.m. hour. and we'll bring you the latest.
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chanceovic. welcome back. fedex is down 3.5%. nike down more than 1%. bottom line numbers, a little bit all over the place and we're still waiting to find out the futures number. usually the barometer of demand. what do you make of it? >> nike is in a very interesting spot. it was the second best after having a really bad 2016. the valuations moderated a little bit. so a lot of people said this was their year. i don't think it dhapgs overyou a story. we're still well below the highs. >> the story is clear.
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thank you so much. see you tomorrow. that does it for us on "closing bell." "fast" moen begins right now. >> this is "fast money." we start with breaking news. stocks getting slammed. posting the real day since president trump was elected. after opening higher, the dow dropped more than 200 points. the s&p 500 down more than 2%. this as trump made his way to capitol hill to push the gop health care plan with house republicans. an effort that is currently facing some serious hurdles. for more on what's at stake, let's go to you. what's the latest? >> reporter: the president is testing his deal making m

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