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tv   Closing Bell  CNBC  May 8, 2018 3:00pm-5:00pm EDT

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potential ataxes or attempted attacks even could be the precursor. >> ceiling on oil you foresee? >> the good news for us, saudis has 3 million capacity, but could drift up to $85. $100 plus is possible. >> john, again, thank you. >> thank you thanks for watching "closing bell" -- "power lunch" - >> thanks for whatever >> "closing bell" is next. >> we're on the floor of the stock exchange, volatile day for stocks as they hang on every word from washington >> announcing today that the united states will withdraw from the iran nuclear deal. >> full details on iran and what it means for oil and the markets. >> i'm julia in los angeles as disney is set to report earnings, we have a first cnbc interview with bob iger after
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the numbers hit. >> we're on the floor of the new york stock exchange, risk of emerging markets sparking as well as potential rewards. i'm kelly evans, big business reacts to the shocking resignation of wall street's toughest critic, and gary cohen sheds light on the next mission. >> holding that smile for a while there. welcome, everybody, we'll get to the stories in just a moment, but, first, a check on the markets, down now, sinking 118 points, down 150 at the low a moment ago, spiked lower after the president announced plans to withdraw from the iran nuclear deal markets initially took that positively, we are still down half a percent across major averages, and russell with a small gain we begin with breaking news on iran nuclear deal we get to our cnbc news correspondent michelle
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caruso-cabrera >> harsher than many expected. there's been a lot of talk whether or not there was going to be a hard exit or soft exit from the iran deal would there be allowances for time, et cetera, but the president came out, guys, saying this ends now, a strong speech reiterating chief concerns with the iran deal, doesn't like the fact it sunsets and never dealt with iran's ballistic missile program, and also doesn't like the effect that iran has had in spreading influence in the region, and the president wanted ability to monitor iran's military sites, and without those, this deal, he did not want it to go forward. what is interesting to watch, guys, is market reaction the dow was briefly positive, oil was positive as well, and then everything has reversed as well the defense stocks definitely higher at this point back to you. >> michelle, thank you, michelle caruso-cabrera, today's deal is
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not the only factor moving oil markets. we bring in brian sullivan with a look at other foreign fact developments that are impacting crude prices as well, brian? >> thanks, guys, outside iran news, there's four story lines clearing it out and walking it out for you. number one, the opec output cuts, remember, they are to last all yearlong, and for the first time in a long time, opec is obeying the cuts they are known for cheating. what do the saudis want? they want $80 oil because they need to fund their big economic modernization plan, vision 2030. right now, that saudi push seems to be working and trumping number three, which is the possibility that we could hit 11 million barrels a day in the united states. we're at 10.5 billion now, a record, some whispers out of texas we could get to 11 million, making up for lost venezuelan barrels, but sand and water is the fourth story. sound weird? it's not what do you need to frack?
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frack sand and waste water dispos disposal, both short supply, prices going up, hard to find workers as well, hurting number three, 11 million. further stories outside iran to watch on oil right now >> thanks, brian, for that >>headlines from iran's president, holding talks with europe and others in the giant agreement that says we're in it without the u.s., and, finally says, if we gain what the iranian people want, we can have a path of peace. >> off the back of that, a point from president trump in the comments, saying the highest level of economic sanctions will be imposed, and any nation that does not enforce them, implying retribution for the like of european nations, so we have to see whatplays out there, and discussionings earlier that european banks might not want to
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finance if they cannot trade with the u.s we'll see how it plays out for more on the oil price itself, our managing director at tjm manufacturing services, jim, like, down 1.5% on wti at the moment, down nearly 3% this morning, and rallied to be flat in the middle of president trump's announcement, so what exactly is the factors behind the moves today? >> well, to be fair, that rumor when we were down 3% today, it was on a rumor somebody came out he was going to stay in the iran deal we're only there for a relatively short period of time, but crude is not only down today, but down relatively significantly from the highs they put in yesterday. look at the long term chart, nothing interesting is happening, it touched upon the upper end of the support of the resistance and came off it tough to rally when the dollar rallies, and the dlafr's been one of the biggest stories in
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the last couple weeks breaking out of the bottoming pattern tough to rally now that's a bigger story than we give it credit for, the strength of the dollar. should we have left the sleeping dog lie? scary when we don't, but longer term, better to get rid of a crummy deal and work from new. >> we have comments from prime minister may saying we urge all sides to stay commitmented to the deal's full implementation, regreating the u.s. pulled out and regrets the president's decision to withdraw from the iran nuclear deal. jim, it is tricky for britain and europe where iran is trying to keep them in it, but the u.s. emphasized like we said that anyone who deals with them could be effectively in violation. >> you know, we are going to have to get used to this style of ruling, never in our lifetime saw this before where someone is willing to rattle the cage starkly as he has. at the end of the day, i believe our partners and allies are
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going to come to the senses and work with us on these things too, and that's why i think, you know, gold has not rallied, so some of the typical risk off assets are okay. i don't like to see the event stocks rally 3%. that's frightening, but there's mixed messages end of the day, we've seen the market digest and become almost numb to some significant headlines over the last couple years, and tomorrow, hopefully, this will not seem to have the shock. >> jim, thank you very much for that >> thank you >> oil prices down 1.6%. >> u.s. withdrawal from the iran nuclear deal changes dynamic between iran and saudi arabia. the two countries have been political, military, and economic rivals throughout history in the region. joining us from saudi ara a arabia, a former executive vice president of saudi aramco. your first take in terms of what this means for the oil price
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>> well, i don't think it's about oil at all i don't think oil's going to change very much there's an abundant supply of physical oil, and the markets are well saturated across the world. this is about security in the region, con fronting a problem that's been with us for many years, and the decision president trump made was a brave one, obvious and realistic position to take you can't keep running the middle east the way it has been with tragic wars and surprising conflicts, and attempts to summit governments left and right from iran. this is about security i think the oil markets will do very well. no problem there >> will saudi arabia look to replace any lost barrels from the oil market
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>> yes, if there is such a loss, i think all opec fills in the losses, and i don't really expect there to be a significant loss of course, you also have the shale oil in the u.s. which is picking up, and you have plenty of inventory still iran may be used to export 400,000 or 500,000 barrels of oil to europe. that might be affected the rest goes far east to china, india, some to korea, and those are unlikely to get affected >> what do you think happens now domestically in iran to the current regime and what might follow if something does happen? >> yeah. i think this is really the focus. this attempt by the regime to down play the impact, i think, it misleading.
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i think within the iran, it's already collapsed, doing poorly, the economy doing poorly, and i think the iranian people deserve a much better government, but this is what they have, and we can't fix that, but we certainly have to look after our interests in saudi arabia and the rest of the gulf, the ooiarab world and disaster going on in iraq. the tragedy in sooyria, and hezbollah and lebanon, and the support that they are getting out of iran, and these are things that just can't keep going on the way they have, and i think president trump has taken a very courageous step making the position clear to the iranians, and i hope they understand, and react appropriately. the people in iran deserve a better government for sure >> the president himself
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appealed to them thank you so much forever joining us former executive at saud saudi aramco >> my pleasure >> looking to replace barrels if they are lost in the international markets. quick check of stocks, moving higher, up about 3.5% right now, lockheed, general dynamics, all rallying after the president announcings the u.s. is leaving that iran-nuclear deal >> interesting, though, to see boeing and the air bus avr trading down, in fact, and airbus -- sorry, boeing annou e announced not many deals with iran, but airbus had >> they had just a land mark deal with iran, double checking that, but maybe it's not a current significant business, it'll probably just be unwinding of the decision to finally introthat market >> right >> both stocks down a percent, and total closed down 2% the french energy company, that was during european trade, you
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have to check in on it at the moment another check in the broader markets at this hour, and, of course, they have been trading down for most of the day there, a brief positive spurt in the middle of the day, but they are down not as much as they had been dow down just 33 points. turning from the u.s. overseas emerging markets on a strong run over two years, but is the momentum changing? we take a look >> emerging markets falling into correction territory, and here's why. first, a stronger dollar makes emerging market debt more expensive to pay off second, rising rates here in the u.s. makes emerging market bonds less appealing to investors searching for yield. data from the institutive international finance shows net outflows of 5.5 billion dollars in emerging market debt in two weeks. the third head wind is higher oil prices, increasing cost for net oil importers like india, japan, and south korea, which has calls inflation to accelerate in those economies,
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guys >> thank you very much where are investors looking in emerging markets for opportunity? neil, you know, again, we just hear the saudi minister talk, and i don't know they get that from the international community, but argentina went to the imf for help after the currency collapsed is this because the dollar is strength strengthening? >> part of it. you look at -- a lot is the euro, basically currencies have been flat, but i say there were three specific currencies suffering over the last week or so the turkish lira, the mexican peso about political risk, and then, finally, the arigentina peso they went to the imf looking for credit facility there, i think they get it, but a long road
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back >> who are the energy importers suffering on the back of oil prices generally rising over the last couple of weeks and months? >> for every russian and saudi arab arabia, they lose, and typically countries in east asia, turkey, and latin america on the pacific side, and arian gene tgentina t feel that fiscally as well, and countries with fuel subsidies, and that of course comes through quickly, particularly in turkey's case. >> in terms of economic data, it softened in european nations year to date, but what's important for the global economy? >> it's fainter at this stage. we track it using our own activity proxy, a realtime measure, not relying on official gdp data, and not starting to show the cycle peaked. it starts to slow in recent weeks and months, and that's partly about pollution control,
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put in place over the winter, starts to buy in the industrial sector, and fundamentally, the economy's growing at above trend pace, and the economy can probably only sustain growth of 4% or less than that these days. >> neil, thank you for joining us neil shearing from capital economics. >> headlines before the bill, iran responding to the decision from us pulling out of the iran nuclear deal the atomic organizations have to be prepared for the next move. we've got 45 minutes to go before the close we're lower, but improving, in fact, now down only just a tenth percent on the dow >> 45 minutes to go. we're just getting started on "closing bell. next up, the banks, will a new activist filing in the city lift the stock plus, our quotes of the day. >> i do have an idea for a company. >> children.
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>> big news and big advice the big show, the "closing bell," live from the new york stock exchange with kelly evans d wilfred frost returns in two minutes. people don't invest in stocks and bonds.
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welcome back to "closing bell" with over fourth minutes until the close, improving frat lows we saw about an hour or so ago, down fractionally at this stage. we check in market movers, dean foods higher on earnings beat, revenue beat as well dairy producer says ongoing efforts to reduce costs are going well it's trading up 15%, and seaworld higher after a loss, and there's a 15% increase in attendance valueact revealed the stake in the bank, citi up 3.5%, and valueact ceo hinted at the official's confidence when he was on "closing bell" recently >> i think we are much more financial than we have been because we think the industry structure changed and companies coalesced around franchises.
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>> you see real growth there >> you see price is everything >> and, kelly, of course, they got full gear in terms of investing in the banks, investing in morgan stanley in augu august' 15, and said they got lucky because the election came, and banks outperformed we have a chart since 2016 the green line there is morgan stanley, second to top, only bank of america outperformed, and clearly in the sub sector of investment banks with goldman sachs performing, so called it then, are they calling it right now? the other point i say everyone's highlighting the point, activist approach, but with morgan stanley, it was not that way, just opportune timing. we'll see if that's what it is with citi. we discuss further, investment bank analyst at jmp securities for some insights.
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we have bruce as well, bruce joining us as well, and good afternoon to you both. bruce, i'll start with you on a point that i mentioned this is this is bode of confidence or against him? >> thanks, wilfred it's a vote for citigroup. when you have valueact looking at shares of a company when they want to get involved in a situation, it's because they identified assets that are under value. i think it also is a bit of a bode of confidence for management in terms knowing valueact in terms of other activists takes a look where they can help a current management team, where they can help improve value by giving some advice by taking a shareholder's perspective by taking it with the assets and moving forward as you were explaining about other investments in which valueact has taken a stake. they take -- they go forward
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with companies with good assets that need help at the board level and management level, but i'm not looking at it anything other than saying they are very much positive on citi. >> yeah, well, we heard that in the comment about the valuation saying that itself presented an opportunity, but, you know, we also know valueact is looking for investments to return 15% a year they don't hold a lot. what do you see of banks putting up returns for next several years. >> sure. there's several things, you know, first off, starting point on the valuations is pretty attractive, so citi trading nine times 2010 estimates, and trading above the historical forward average so financials are attractive to the broader market so as a starting point, there's a good entry point on some of the stocks, and then they are looking at what's misunderstood and what can change i think you think about, you
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know, every company's idiosyncratic. it's not a financial statement for all, but opportunity for better revenue growth, better, you know, operating leverage than people appreciate, or be better capital exchange, and people are identifying these and could be helpful in the process of moving the ball forward there. last point, what's changing? they are looking for areas where there's change i think financials are one of the biggest areas impacted by change, whether it's tax reform, how that stimulates the economy, and whether that is regulation there's just a lot of change occurring here, and i think we're looking at all the things, look back, starting point on valuation, and that's interesting, so i don't say, again, it's all financials, but i think you get all three of those, and that's interesting. >> steve, valueact disclosures and letter around this focus is very clearly on the u.s. investment banking being
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attractive, but of the u.s. banks, there's the highest exposure is that an attractive part to be in as well or just the u.s. parts attractive >> from the perspective how investors think and behave, and remembering we look for value, it's all over the world, there are targets, and value can be created through looking at companies with global operations, but breaking down pieces, and with valueact, much like the number of other large investors, they look at the pieces it's not necessarily the market per se could be the market, but it's really more a case of understanding how those pieces can create value, and it could be with a group like citi, target it sector by sector,
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country by country, but there's a lot of value in the states, and consider shareholder base, they see the value and get agreements from other investors. that's where the play is >> good stuff, guys, thank you very much. bruce and devon ryan talking banks with us. >> 35 minutes to go, down just about 23, small declines in the s&p, nasdaq, and russell with a small gain a name change what the doctor ordered one company makes a move to gain back public trust. gary cohen on cnbc today, first tv interview since leaving the white house and what he might do next. stick around we are back after the short break. (indistinguishable muttering) that was awful. why are you so good at this? had a coach in high school. really helped me up my game. i had a coach. math. ooh.
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welcome back, 32 minutes left in trade. we focus in on stocks to watch today. >> valeant pharmaceuticals, higher on earnings beat, raising guidance for the year, and changing the name to baucsh company, and that contributes a good share of the revenue right now. >> and next stock to watch is comcast, our parent company, the company's planning a $60 billion all-cash bid for 21st century fox's asset topping disney's bid
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of $52 million and as well as for sky, and combined price could be as much as $100 billion. comcast down 5%, and clearly, it's a big offer, what that does for banks, and i say there's precedent of these cable companies doing such a highly levelled deal. another couple points to make on it, if it ends up being that route, all cash, blanks lift, but it has to be financed too, and they make a lot of profit. the other fascinating thing is a chart here of sky over the last couple years sky, such a crucial piece on who wins overall, shareholders have to be delighted they traded seven pounds 50, first bid at 1075, and next bid from comcast at 1250, and they debate it could go 100% higher
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>> mirror image with comcast, back to the interview with jeff ubben, it's interesting the way public markets do not allow for valuation of assets sometimes correctly. it happens, but for years, sky is languishing out there, and now there's a battle for it because it's so valuable to both companies. >> 1350 right now, 750 before this extraordinary moves. largely because everybody wants the rest of the other assets it's tight anyway, comcast down 5% today. >> ouch. quote of the day, here's highlights from today's charity day at btig. gary cohen in his first interview since leaving the white house gave a hint about the next move. >> i do have an idea for a company as well, and there's a company i'm spending a little bit of time with, lawyers right now, and looking at the possibility of a company, see if it makes sense >> can you tell us who it is >> no, i can't
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>> okay. i had to ask >> so i watched this back a few times. when you read the transcript, i do have an idea for a company, like, oh, my gosh, is he going to start his own new thing as an entrepreneur, but if you watch it back, he's more, i think, implying he has an idea of a company he wishes to join. >> i think you're right with the first guess. >> i don't know. >> you mentioned he does not want to get involved backing young startups and misses working with the dropbox ceo and uber, but in this case, it was an idea in financial services i might want to explore in terms of launching something, not to say he's going to do it himself, but it sounds like he's -- his name was mentioned earlier, wells fargo securities floated his name with citi that the chairman will be gone by next year, and maybe he could be put in for that. >> not ruling out anything >> he did not, but that was a great interview with bob pisani
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and another one with shaq who gave - >> shaq -- >> what did i say? hold on -- >> shaquille >> i was basically correct >> roll it >> this is $100. what you want to do is rip the hundred in half, that's 50 save it. don't ever touch it. put it away. don't look at it now you have 50 left now, smart people, the real smart people, billionaires of the world, they take the half of the 50 and put all that away this here, have fun. you want to buy houses, cars, you want to buy planes, you want to travel, this is what yo have fun with this is what you need for when you retire invest put it away. save it. don't touch it this is the house money and what you play with.
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>> emphasized more and more for all the players, the need, and shaq has done great in the post-career, and i'm going to show you shaq a fool, a fantastic show >> only spending 25% of the earnings, though, that's a tight budget >> that's what makes you a billionaire. >> sure, if your initial wage allows that. >> hey, you can put a couple more bucks away. what did jim do? slept in the car while he put more dollars in the market every month. >> i love the pictures people tweeted of them next to shaq over the years, whether it was bill or bob. i want to be up there someday. >> you're 6'7" >> 6'5", anyway, time for a news update >> i got your back, wilf, don't worry. this is what's happening at this hour, everyone president trump signed a presidential memorandum withdrawing from the iran nuclear agreement he called defective at its core. he added the u.s. is planning to
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reinstall sanctions on the iranian regime >> it is clear to me we cannot prevent an iranian nuclear bomb under a decaying and rotten structure of the current agreement. the iran deal is defective at its core if we do nothing, we know exactly why will happen. >> meantime, iranian president rouhani responding saying tehran remains in the deal without washington, and trump undermines treaties benjamin netanyahu responding by saying israel fully supports president trump's decision calling the original deal a disaster for world peace you're up to date. that's the news update this
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hour back downtown to you ask her to pronounce scones. >> i say scones. >> exactly most americans say scones. >> scones. >> yeah, well, chocolate chip scone with my latte. >> there you go. >> my favorite breakfast >> i didn't know you could get a chocolate chip >> it's america. >> exactly sue, thank you for looking out for me, as always, a delight we have 25 minutes until the close. recovering into the close. dow essentially flat, down just nine points, was down 150 points s&p, nasdaq, lower by a tenth of 1% more reaction to iran decision including the impact on companies that do business in the region >> plus, disney's ceo bob iger will join us after the bell on the back of his company's earnings release it's an interview you don't want to miss coming up in a half hour's time. stick around we'll be right back. i'm dianne feinstein and i approve this message.
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i thought after sandy hook, where 20 six and seven year olds were slain, this would never happen again. it has happened more than 200 times in 5 years.
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dianne feinstein and a new generation are leading the fight to pass a new assault weapons ban. say no to the nra and yes to common-sense gun laws. california values senator dianne feinstein welcome back to cnbc, i'm michelle caruso-cabrera at the
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breaking news desk president obama put out a two-page statement in response to president trump's statement withdrawing from the iran deal it's a vigorous defense of the iran deal, which, of course, he orchestrated under his administration and says, quote, the deal is working, and the president's quote is misguided here's a quote we can give you, a lengthy statement, saying at a time we root for diplomacy with north korea to succeed, walking away from the jcpoa, the iran deal, the it accomplishes with iran the outcome we are pursuing with the north koreans not a surprise that president obama is unhappy with what happened today back to you. >> put at a statement so quickly, michelle, thank you very much, and, by the way, our fresh ambassador to germany tweeting, german companies in iran should wind down operations immediately. >> joint statements from the prime minister in the u.k. and
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french president macron emphasizing continued commitment, and those came out quickly as president obama, very much prepared. >> not even clear how that works, anyway, 20 minutes to go into the bell here, and dow down five points here, down 150, briefly positive after the president made the announcement and working back up to the territory. joining us, lori, and next to her is keith from drive wealth, and rick santelli in chicago what do you think is going on with the message the stock market sends the oil price and volatility of the president's announcement >> to be determined thing what happens with the nuclear deal. as you pointed out, it was a yawn we were down a little bit, then we drifted higher, and now basically flat on the session. surprising move for me is i fully expected oil prices to be positive on the heels of the
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news iran is not a big a producer as everybody thinks they are, but potential destabilization to the region, that could affect output in other areas, but it's important to note that the u.s. has become a very big oil producer and oil exporter, than that affects there we'll wait to see how it plays out as it relates to the equity markets. >> lori, buy the energy sector right now? >> not really, no. energy stocks have not moved as much as they should given where oil prices are, but as keith alluded to over here, we are now even in the export mode, and we're energy independent if this happened ten years ago, i think you would have seen oil prices skyrocket some is already in the market as this news has been dripping out now for at least two weeks >> rick, what about you?
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the dollar stronger by a third of a point today >> i'm very impressed with the markets. now, granted, the markets are not the defining rod of foreign policy, but investors pay close attention and trading to see as keith pointed out, to see oil end up lower and gold still, you know, after a very subtle bounce hovering another the lowest levels since last year inverse to the dollar, which, as you pointed out, up a third percent, highest close since december 26. above 93 now look at the yield curve, any inkling of flight to safety, put that away right away two year note yields, 2.5, and two year note yields 2.97, it's the 10th day we settle in between 2.98 and 2.95.
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unbelievably tight range with what may happen, of course, i think anybody following this administration is not shocked with the outcome the markets are not shocked. it does not dismiss that it's still a very hot item and traders can change their minds quickly as some of the news regarding what the president did just hours ago, of course, continues to come out and get interpreted. >> all right >> i wanted to switch focus quickly on another big story of the day in terms of media and m&a and what's beginning on there. do you see that as a buying opportunity with the likes of comcast down sharply 5% today? >> i would say yes interestingly enough, the market focused on the changing of consumer habits to streaming if you look, comcast is down 18% year over year, and disney loses competition with fox, that's flat to slightly down year over
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year, and netflix, which does not use advertising dollars at all is up 30% in the last three months and climbing. >> just get rid of commercials everywhere else. >> and everything, right next generation pays for everything >> what were you going to say, though >> i was going to say is that subscribership is down, cable cutting is off, and i would not count comcast out. >> happy to leave it there thank you, all, lori, keith, and rick >> maybe we should cancel commercials since we're goabouto go to one. >> which are important everybody watch it, 16 minutes into the close, and dow fractionally lower now, down 4, nasdaq down 2, russell up 7. we will be talking earnings, bob iger will be elaborating on company results. >> google's new ai assistance,
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smart or scary josh lipton is on that front >> we are here at google's ilveloper show, and unveing new technology, new jaw-dropping technology, wilf we'll show you that when "closing bell" returns [ male announcer ] eligible for medicare? that's a good thing, but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they pick up some of what medicare doesn't pay
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welcome back to "closing bell," google's system may make your phone calls, and josh lipton has more on that story for us, josh >> reporter: that's right. google introducing technology here, wilf, making the system much more productive, now able to make a call on your behalf and book a reservation with a real business. take a listen. >> how can i help you? >> hi, i'm calling to book a women's haircut for a client, looking for something on may 3rd. >> sure, give me one second. >> uh-huh. >> sure, what time are you looking for around
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>> at 12:00 p.m. >> that's not available. closest we have to that is a 1:15 >> do you have anything between 10:00 a.m. and 12:00 p.m.? >> reporter: incredible there. you can see the person had no idea she was talking to a digital assistant. that's how life-like and human that assistant is. we also caught up with google's head of ai to explain why he thinks they have the advantage in this race of digital helpers. >> the assistant is really an extension of that where we want to organize your personal information, and the information you need at your fingertips and it helps you accomplish things >> reporter: now, google making it clear this is still technology under development they will be experimenting with it over the next few months, making sure they have it right before rolling it out to users and businesses, guys >> josh, my main question, i guess, is can the assistant impersonate the individual
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clearly, the assistant there was acting as an assistant booking a hair appointment for a client. >> can it sound like wilf? >> would be priceless if so, but point being, can you use it to call home -- >> and sound like you. >> yeah. can they impersonate as well or not? >> reporter: it was not clear, wilf, it would sound like wilf the idea is there's going to be more voices, and can speak in 30 languages, rolling out to 80 countries. the point not that it sounds like you, but remember when they talked about the assistant, it is supposed to be that much more productive that's the ultimate aim of the assistant for him, not that it tells you weather or traffic or sports calls here, but helps you with every aspect of your life, but raises ethical questions and practical questions. for example, does the person need to know it's actually talking to a machine, guys >> josh, thank you
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you want an impersonator to call your mother. that's what you want mother's day is coming up and everything >> yeah, well, mother's day in u.k. has been been done and gone, but anyway, if they are looking for that generic british voice -- >> happy to supply how could you do better? >> i'm up for it >> dow down four points, 900 sell on the bell according to art. we'll be right back. (baby crying)
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one more way comcast is working to fit into your life, not the other way around. welcome back, mike santoli is posting up hertz. >> they are getting punished today, results last night, the car rental business is tough, showing how tough, a wider loss than expected, sales okay, but no great signs that promised turn around under a new ceo is gaining traction selling bad performing cars, invest in the fleet, hitting it at 20% today, carl icahn bought more we'll see what he does >> great stuff, mike, thank you very much for that about five minutes left the trade, and the final countdown is up next when we come back
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until exxonmobil scientists put it to the test. they thought someday it could become fuel and power our cars wouldn't that be cool? and that's why exxonmobil scientists think it's not small at all. energy lives here.
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(slow jazz music) ♪ fly me to the moon ♪ and let me play (bell ring) welcome back to the "closing bell," a roller coaster ride intraday dow has been down 150 points, and up as much as 50 points, but
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s&p 500 is a ride, ending well off the lows the the dow's down 15, the s&p slightly lower, and nasdaq slightly lower, but improving momentum as we approach to the close. we are on the floor from o'neil securities, anything to watch in the close? >> certainly, all trump-iran deal thing, right, what impacts are on the market, and how the market reacts. interesting to see it sell off and rally back, but tonight after they really dissect and digest what he really said and what it means, tomorrow could be more active. >> oil prices volatile in the last couple days, in general, been stronger with the theme >> right >> they were down 3% in and around from the announcement >> right >> i think what happened was that -- hold on, there's trades. >> this is the action now. thank you. we got to go he's got to close trades >> yeah. >> as we approach the close, there is oil prices for you intraday, low as 3% on the day,
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closing or ending at down 1.5% year to date, though, you see that strengthening trend, of course, which has been driven by some of the middle east geopolitical concerns. switching forward for a look at sectors. middle of the pack in the middle of the day, oil down 3%, energy and today as the best performing sector, up.7%, and eutilities down sharply yields rose today, and that's why financials are one of the better performing sectors up there at .6%, banks doing well, led by citi and investment by valueact we look at some the media stocks, fascinating, of course, reports that comcast has a cash bid of 60 to 100 billion depending whether you include the sky valuation. there's all the companies, down 5% on the news disney down three quarters of 1%, and sky having a bad day, and u.k. trade, of course, up,
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but down a little bit, and, of course, more answers about this after the close when we hear from disney reporting earnings, and bob iger sitting down exclusively. at the bell, we are down just one of two points so we rallied nicely in the last hour of trade on the dow, and basically, all three indexes are flat at the close. ringing the bell here at the big board, sl advisers, and pbig for the charity day, such great coverage of from the dow, and just above flat, kelly >> thank you, and welcome to the closing bell, everybody, dow just turning positive on the bell here, up a couple points, two, three, watching that as things settle out. green for the blue chips, looks like it's green for the nasdaq as well, and the dow at 24360, and s&p down a point right now,
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pushing index to 2671, and russell 2,000 positive throughout the day, up half a percent on the bell, 1586. a lot to discuss about the president's announcement to pull the u.s. from the iran nuclear deal the impacts that had late in the session, and it's busy session for earnings and reporters are standing by. julia has disney results for us, and electronic arts, trip adviser, match group, and kate with earnings from wendy's see you in a couple minutes as those start to cross joining me now, michael santolli and bill smead, and john blank welcome to all of you. by the way, jpmorgan, gainer in the dow today, verizon the biggest decliner of the 30, and s&p, jacobs engineering group, and dish network had a 12% drop. we talked about the challenges in the media space >> yes >> putting that aside, what is
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your read on how the market is taking and just the first two hours of reaction time the president's decision >> essentially absorbed the news, taking it as expected, and essentially almost exactly stalemated and flat. half the stocks up, half down, index is flat. i don't think that the implications whether they are going to be positive or otherwise in this decision today are on a time horizon where the market today prices it in one way or another it was about what the market is going to do in the absence of this announcement, and that's what we got, which is a flat market, but yet with the sector leadership looking okay, financials and industrials, tech, transports, so, essentially, a decent story in an idle market >> bill, interestingly enough, price of oil down a buck now, and big question mark there is what happens with iranian production, other members step up and produce more, and is the u.s., like brian sullivan alluded to earlier, going near 11 million barrels a day if we need to here in.
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>> it's interesting that musk and auto manufacturers move towards electric cars and uber rides high in the united states in reducing oil consumption and here we are, you know, what is it, ten years after the peak at 145, this is the second big bear market rally in oil. we were taken to 114 in 2014, and this rally might take us to 80, but no matter how you look at it, since i'm the only one that says it's a bear market rally, i'm convinced it's a bear market rally >> all right that means, bill, you're not bi on energy names? >> no, and not because -- not for six months purposes, but for three to five years. >> okay, john blank, we have earnings coming, but earnings season largely over. it was very, very strong, but what do you look for now
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>> kelly, i don't know i think the market's going to be looking at profit margins, how they compress in face of rate pressure, so right now, we're in a world where we got to see how inflation and through the wage channel plays out into the profit margins, and if they hold up, we can get another leg in this market in the second quarter that we didn't see in the first quarter. >> and, mike, we had strong data this morning, the lagging numbers, again, beating into the picture of incredible strength for the u.s. labor market. >> resilience here, sitting in the treasury, it's nudged higher, dollar higher because it seems as if the u.s. economic picture is sturdy, anywayings and the rest of the world is softening up there's a differential, so, yeah, it's all in place. it's funny it's almost as if we put that in the, you know, stipulation column coming into the year. u.s. growth is fine. earnings are good. what else you got? that's what the market's been about for a few months >> bill, i know you follow
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warren buffet closely, news from that over the weekend and through yesterday morning, and his discussion with us here on cnbc, and buying apping, liked owning the name, what got you thinking hearing what he had to say? >> oh, i thought the most astounding thing is watching becky and in other people asking him the same question that if you understood some of the good aspects of amazon and google, shaming him about not buying them, you know, to me,shaming warren buffet about what he did not buy is like criticizing michael phelps for not being a pro golfer >> well, in fairness, it now appears as though he's taken, let's see, to follow the analogy, he picked up the golf club, you know, he's swinging and liking it out there, and that's how they feel about him in apple and the fact he's liked amazon, but not purchased a share. >> apple is the technology what
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coca-cola is to water. >> i think i follow what you're saying there, maybe, but let me bring mike back in, mike, going back to some of the movers in the market today dish down 12%, but earnings are crossing now, so let's skip out to the disney results with us, julia joining us with the numbers, julia >> kelly, we've seen disney shares move 1.5% higher after the company beat expectations on both the top and bottom lines. the company reporting revenue of 14.548 billion, 9% revenue growth, beating expectations of just 14.1 billion. earnings per share coming in at 1.84 per shear, up from $1.50 a year ago, versus expectations of $1.70 per share. beating top and bottom, and looking what's driving that
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growth, media networks, always under scrutiny with concerns about cord cutting beating expectations on both the bottom and the top line, but looking at what's really driving that upside surprise, you see both parks and resorts and studio entertainment, both reporting both earnings and revenue -- earnings and revenue better than expected with the exception -- and entertainment -- that revenue better than expected on the heels of strength of "black panther," strength across the board there, particularly in parks and entertainment. now we have disney's ceo, bob iger, thank you for joining us >> pleasure. >> bob, a lot here in the earnings report, but before we get to all the news about sky and fox and everything going on with your acquisition in the work there, i want to first get into what's driving the results. what is going on with your media network division are the declines with subscriber
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losses moderating? why are the results better than expected >> started to moderate, declines this quarter were less than the declines seen in the prior two quarters what you're seeing is continued growth in the new, we call dmvpds or the digital distributors, and that's great for a number of reasons because they carry all of our channels, and we think it's a very consumer-friendly proposition. the growth of those is offsetting the losses of traditional platforms. that's helped a lot. >> upside surprise in the parks and studios, sounds like you raising prices at park does not discourage visitors. >> you're seeing parks are continued investment in that business, and many respects on the backs of great intellectual property, clearly, driving growth in the business, and we're seeing that globally, which is great they come to interact with the characters they know and love on
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the big screen and the small screen, so that helped a lot we've seen no negative impact on pricing increases, but in part, as we invest more, both in the actual ip that's in the parks, but also in the experience, you know, the ability to book attractions in advance, et cetera, and so on is making for a better experience overall, and so we've seen increases there, and the studio has phenomenal executi execution, and "black panther" led the way in the quarter, and i can't say enough of the performance of the team. >> questions about how much bigger your studio might get, fox, acquisition that's in the works go through, and now cnbc has said that co machimcast is preparing to bid $60 billion in all cash topping your $52 billion offer in stocks for fox. what's your plan should fox go -- should comcast go through
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with the officer on fox. >> i'm not speculating on what they are doing or why they are doing it, i can only say that as you know, we made a deal in december that received unanimous approval, which is important, by the 21st century fox board we're in the process of filing what we need to file to gain regulatory approval and shareholder approval, and we are excited about the acquisition and confident it's going forward. >> if you have excited about the acquisition, how much more willing are you going to pay if fox tops your bid? >> i'm not going to speculate about what exactly is going to transpire at all, and i'm not going to speculate about how that impacts us. we made a good deal, a deal that shareholders reacted quite favorably to, and we remain confident in the ability to close. >> your stock is down since the deal first nnounced, and your
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offer for fox is all-stock compared to comcast being all cash what do you think of the difference there >> well, again, i'm not going to speak for what someone else might be doing the offer that we made received approval by the fox board. they obviously believed not only in what we were paying, but how we were paying for it, and the combination of the assets in terms of a currency, the combination of assets we are buying in disney is obviously, very attractive, and given the strategic bid and the value going forward, particularly in a media world that's transforming right before our eyes is obviously quite attractive, and we believe, therefore, that currency will be attractive for long term. >> one part of fox appealing to both you and comcast is sky. comcast made another offer for the remainder of sky are you willing to let sky go if that means you close the fox bid? >> well, we're as part of the
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21st century fox acquisition, we buy the 39% that 21st century fox already owns we know they've been in the process of trying to buy the remaining 61%, and that's pending regulatory approval. should fox be successful in buying 61%, we would step into their shoes, and ultimately, own 100% of it, but under any circumstances they don't, we own the 39% that will be bought as part of the acquisition and intend to hold on to that. >> as you talked to murdoch about the news, what he thinks about the plan for sky, especially with comcast coming in at the higher price >> i talk with rupert on a regular basis about a number of things, including sky, but no headlines there. >> do you want to tell us what you decided to do about countering comcast >> no, i don't want to speculate that there will be anything. >> okay. >> i don't want to say anything more >> you mentioned regulatory approval, where do things stand now, especially as we await a
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ruling on the at&t-time warner merger are you concerned for your prospects? >> we are filing in multiple jurisdictions around the world including, obviously, the united states and the eu, and other territories, and we don't believe that this acquisition is similar in nature to the acquisition that's currently under scrutiny between at&t and time warner. we think it's actually quite different, i mentioned earlier feeling confident that our deal is going to go through, and that's not only a confidence in ability for us to convince fox shareholders this is good for them, so we're confident in the ability to gain regulatory approval we need in all of the jurisdictions. >> you mentioned the benefit of having fox's asset, the new digital landscape. how much are you counting on the assets to build up your direction to consumer offerings, both with hulu and what you're working on with the new disney app? >> well, we're launching two new
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services we actually launched one already, espn-plus, well ahead of the fox acquisition, and not reliant at all on the assets that bewill we will be buying. in the sports case, we buy regional sports network, and they are a component, ultimately, of some form of direct to consumer proposition, but the direct to consumer sports proposition we take forward, and we'll continue to run is not thoroughly dependent upon getting those assets. espn has a number of assets already. we continue to buy more, in fact, today, we announced an acquisition of a ufc, and that's met a number of ufc events, ultimate fighter championships, and the disney app has pixar, marvel, and star wars lucas film, so that's not dependent on the fox acquisition. hulu, obviously, already has access to certain fox assets, and it had been the intention
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should we own 21st century fox, and thus gain 60% stake in hulu to continue to fuel hulu with more intellectual property from both companies >> you mentioned espn plus app, it's been out for a month, how is it doing so far >> i don't have specifics in terms of numbers, but reactions have been positive from customers. we've seen pretty good adoption rates from what was free, there was a trial offer to pay, to basically subscription, and that's been quite positive app seems to be performing quite well, continues to it rate, meaning we continue to seek ways or find ways we can make the user experience even better, and i love it. i watched it the other day while waiting for my son at basketball practice watched the yankees game live on the ipad it worked well we feel good about the direct to consumer propositions we are
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taking out, and, again , neithe of the two i spoke of is dependent upon assets we have in the acquisition. >> in terms of espn plus, do you make big additional investments in content nascar is up for sale. where are the big bets >> we'll continue to make bets, meaning acquire rights specifically for espn plus over time, we'll have the ability to perhaps migrate rights from the other services on to espn plus, but the goal is to create a sports market place and great destination for sports fans here and ultimately around the world. you know, this -- we -- as you know, we live in such a different media landscape today, and mobility is of real value to consumers, great user interface is also important, and that's what we look to create with great intellectual property. >> final question on the media landscape before you go to the earnings call. how much -- or -- at what point
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will new digital offerings compensate for the traditional declines as the market declines for traditional tv >> good question i don't know that i can say at what point, but i believe given what we've seen already with the adoption of digital platforms, whether it's the channel platforms that already launched, hulu being one of them, youtube another, directv another one, or sling another one, or the product we intend to launch. we believe you'll continue to see real growth in digital platforms, and continued erosion on the traditional side. i think, ultimately, the new business will ellipse the older business, and i think it'll probably happen sooner than most people initially predicted, and that's why we're going into this in a big way >> bob iger, thank you for joining us, come back and fill us in on plans as a potential bidding war could be brewing here for fox as well and sky thank you so much, guys, back over to you. >> all right
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thanks to bob iger and, julia, great stuff, speaking with the ceo of disney, shares up 1%, mike, after the interview, after the results. going down through the major categories, it was a slight beat on pretty much everything including the cable revenues, it looked like, and in the end, encapsulated it nicely saying growth is digital. he expects continued erosion on the traditional side, and the new business eclipses the old before people expect >> that's the bet companies make, what the optimists like to believe. the results are good across the board in terms of relative to expectations and last year by the way, tremendous beneficiaries in the tax cut, ten point cut rate, that was known for interesting reasons, disney is heavily domestic taxpayer, and that was a big impact, so free cash flow is up massively. the company as it is right now is in good shape only reason they discounted to the market because of what people's fears were that the existing business is going to erode faster than it's replaced,
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and right now, look at the results, you wouldn't say there's anything to worry about or it's a business of secular decline. 9%, you know, top line growth year over year or something like that >> exactly the concern >> right >> bill, you in disney. >> look at history. you know, people thought the vcr would mess disney up, and thought cable messes disney up only thing that messes disney up is if people stopped producing 5-year-old children. a child is born in the united states of america and most places around the world, and they are automatically a disney customer secondly, content is king. i don't care how you distribute this stuff listen to what iger's saying do you really think that amazon and netflix are going to throw money like spaghetti up on the wall and outperform these folks that have been doing this for decades and proven over and over
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and over again that they are superior content managers and brand creators >> unless the economics are better, bill we talk netflix's market cap is approaching disney's now >> who did better, the school or the bus driver the bus driver was the distributor. okay it's -- everybody's -- they got their thinking crooked blockbuster win? did vcr win? it's the distribution system changing disney won they keep winning, right doesn't make a difference how you distribute this stuff. whoever makes the great content wins the game. >> all right and it's not a cheap proposit n proposition, but disney trying to even bolster itself with fox with that deal to have much more content to compete against the likes of netflix going forward shares 102 and change right now. electronic arts, quickly, earnings out this afternoon. >> hey, kelly, ea shares out by
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more than 3%, the company seeing a small beat in terms of net bookings, 1.26 billion versus . 1.24 which was estimated once you take out certain items, it appears to be a beat, and also, announcing a new 2.4 billion two-year stock repurchase program, doubling the current buyback program. a little bit light on the guidance, however. fiscal year 2019 bookings sees them at 5.55 billion versus 5.61 billion, which was estimated, also, a little lower on q1 as well 720 million versus 796 million, which was estimated. on the call, kelly, we'll look for any commentary around fort knight, massive hit from epic games. analysts feared engagement in ea games would decline because of that listening for that, especially any commentary about the battlefield community. back to you.
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>> thank you ea shares up 3%, and activision with strong results, quelling concerns about fort knight gas up .45 cents from this time last year. joining us by phone is the co-founder of oil price information service, tom, checking in with you on where do you think the gasoline prices are headed now as things -- especially after today's announcement >> caller: well, kelly, i think it's going to be trouble for mr. iger and disney. i think despite, you know, everything you hear out there that we are headed for higher prices, not so much because of the trump action on iran, but global demand exceeding supply by a million barrels a day in the middle third of the year it's not long term, but you're going to have higher numbers and
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could have drastically higher numbers if you have tropical storm weather during the summer. we don't have a gasoline glut or a comfort zone >> bill, did you hear that trouble for disney >> everybody thought everything's trouble for disney for about the last 70 years. 80 years so, now, look, the stock's at 14 times earnings it's a clearly superior company for decades with massive free cash flow and strong balance sheet. don't forget why you own a business, end of the year to have more cash than you did at the start of the year, and, you know, just think of the brands, they just keep accumulating massive franchise brands, you know, i like my -- >> go ahead, tom >> caller: i want to say this driving season, which starts labor day, you know, average family's paying $200 more than
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last year. $250 more than the previous year for fuel i'm not sure what the ticket prices are in disney i'm hearing in florida, it probably does not get you two tickets. it does have an impact, and we are consenting with numbers that put the president on a tight rope it's once we get above $3 a gallon in some states. we're there for about ten states now. >> yeah. >> the numbers we just stated there are almost exactly what the average family gets from tax cuts it's so interesting that the $270 the average family gets from a tax cut, nobody said people were going to gladly pay more at disney because of that, but now that the oil prices go up, oh, that's bad for disney. it's not bad for amazon, it's not bad for, you know, anybody online, but it's bad for disney. right? if you're -- >> caller: it's -- so bizarre -
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>> there's a psychology that's bizarre. >> we take your point, but i think, tom, you have a point about the president, too, trying to do something to counter the effect, especially if it hurts the tax cuts guys, we have to go, tom, bill, all thank you for joining us a lot there. appreciate it. a lot more ahead still on the "closing bell. straight ahead, more on disney as two shareholders square off on the mouse house. plus, energy certainly one sector impacted by the iran deal. what about defense stocks? they are also on the move. the "closing bell"it wh kelly evans live from the new york stock exchange is back in two minutes.
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it's a new kind of network designed to save you money. click, call or visit a store today. welcome back to closing bell, a look at trip adviser's earnings, shares serging in after hours after the company reported better than expected earnings on its top and bottom lines. earnings of .30 adjusted versus estimates of .16, driven by the non-hotel segment. the portfolio of properties that include everything beyond hotels think of homes and alternative
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lodging. non-hotel segment growi ining 3 year over year pointing out user reviews and opinions grew 26% year over year 630 million in the quarter marketing initiatives and all the capital spending on marketing is starting to pay off on that note average monthly unique visitors on trip adviser, branded website and apps grew 12% year over year, and the conference call is tomorrow at 8:30 a.m. eastern, but positive remarks even on 2018 guidance, up 18% there, this is a big dog last year, lose 24% last year, but recooping losses today >> still climbing, thank you very much. shares of disney higher after hours, not by that much, though, up half a percent right now. moments ago, ceo bob iger was asked if comcast goes through with the offer to buy 21st century fox. >> we made a deal in december that received unanimous approval, which is important by
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the 21st century fox board we're in the process of filing what we need to file to gain both regulatory approval and shareholder approval we're certainly excited about that acquisition and remain confident it's going to go forward. >> let's bring in our shareholders to see if they agree. ross gerber is here, good to see you, ross, so what do you think disney should do about this potential counter offer? >> well, i think if an offer comes in from comcast, i don't know that it will because it leverages comcast a lot and i don't see the synergy here, but if they do because there's a jilted lover, if i'm disney, walk for sure. i take my billion and a half breakup fee i get when fox breaks it off, and i can go out and buy other assets, but, really, fox needs disney a lot more than disney needs fox >> robert? >> i don't know. there's properties there like
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hulu, star india, the marvel properties that i think will be very important to disney, so i wouldn't be surprised, honestly, if, you know, we're still looking a month from now, and comcast is at the table because of time warner at&t deal went through that we don't see disney sweeten the deal a little bit. could be a breakup of the sky part of the deal, but i think, ultimately, this is a deal that disney and bob find a way to make happen. >> ross, do you like the deal? >> yeah. >> say they raise the price, whatever the case may be, but agree with bill saying content is king right now? >> bill smead is right on, man, saying it as forceful as possible he's absolutely right. this is one of the best undervalued value stocks in the stock market look at apple and what buffet did with apple who is next? buffet goes to disney next fits the same properties of an investment he'd make, i mean, 14 times earnings, rising dividends, look at the cash
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flow, and, i mean, the brand is untouchable. it's our top position at our firm, and apple's the number two position, and we love those two positions, obviously >> all right guys, thank you. ross gerber, robert talking disney time for a cnbc news update with sue >> hello, kelly. this is what's happening at this time, everyone president trump signing a presidential memorandum withdrawing from the 2013 iran nuclear agreement, which he calls defective at its core. he added the u.s. is planning to reinstall sanctions on the iranian regime >> today's action sends a critical message the united states no longer makes empty threats. when i make promises, i keep them rouhani responded saying there's a short time to negotiate with the other countries remaining in the deal, and he warned his country could start enriching
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uranium more than ever in the coming weeks, speaking live on iranian tv former president obama issuing a statement calling trump's decision misguided and a serious mistake also saying there are few issues more important to the security of the united states than the potential threat of nuclear weapons or the potential for even more disruptive war in the middle east that is why, he said, the deal was negotiated you're up to date, kelly, back to you >> all right, sue, thank you very much. we'll pick up where you left off. joining us to discuss implications of the president's decision today are fred kemp, president and chief executive officer of the atlantic counsel, and leah, global head of commodity strategy of global research another rbc capital markets. fred, there's confusion about what exactly iran's threat and possible steps to restart industrial enrichment means for what sounds like europe's intention to try to stay in the
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deal although the u.s. pulled out. >> it's hard to know what it sets off we saw president trump taking the more extreme of the options he was looking at. that is interesting. he's a guy who likes to do deals. what we see is trump administration 2.0 and trumps watchers, now dealing from the gut, doing what he wants to do secretary tillerson ahead of last year held back, and did not give him an option to withdraw saying there were no reasons to withdraw this is what he wants to do. the question is, what deal could this lead to president macron of france led the road open for a comprehensive set of arran arrangements to take on iran's misbehavior, to take on iran's ballistic missiles, and other things like that will the iranians be willing to negotiate? will the europeans be willing to negotiate something new, and we
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are in new territory, and this was the most important decision of the trump administration to date >> wow >> where do we go from here? i don't know one other thing to add to this iran -- or israel is on high alert right now. they are worried about iranian attacks on israel in answer to attacks they had on iranians positions in syria, but this is all so connected you could have a response from iran either there or against u.s. troops in iraq. >> with all that being the case, why is crude down a buck today >> yeah. we got back some of the losses from earlier in the day, but i think the market is not where fred went. thinking narrowly in terms of barrel, maybe a couple hundred thousand off the market, could be, you know, sanctions, but not thinking about the iranian response what happens if iran resumes enrichment or there's military attack on israel the market is narrowly focused on when the barrels roll off,
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what's it mean if russia and china do not go along. i think the impact is minimal, but there's a broader middle east fear that could be returning to the market. >> all right guys, thank you, got to leave it there. we'll watch it, of course, to see how it plays out news on facebook to get to here. >>kelly, big executive changes over at facebook to tell you about across messenger and facebook's core app, the biggest shuffle in the company's 15-year history. david marcus who ran messenger is working on block chain within the company, part of the new effort and unit dedicated to the technology remember, marcus on the board of coin base, taking over for him is messenger's head of products taking over the messager app and team, and facebook is also adding a board member, jeff zias, ceo of a diversified holding company, and another
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major internal management shuffle remwith structural chan as well, and chris cox stops running product for facebook's core app and now oversees all of facebook's apps r and it's a new unit called, quote, family of apps, so messenger and facebook will all now report directly into cox the shuffle, again, kelly, facebook's biggest in a pivotal moment for the company as it faces privacy fallout ahead of the mid-term elections and fallout from cambridge analytica. this was announced to employees today. back over to you >> thank you no immediate reaction of shares there. goldman sachs saying a major defense contractor could rally 30%. find out which one it is and how fast money traders play it that's still to come on "closing bell."
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help us do our jobs better. with domo we can run this place together. well that's that's your job i guess. ♪ welcome back here's a look at how we finished on wall street, quickly, dow up a couple partnershoints, s&p lo nasdaq hanging on to a gain, and russell up 7 points there. major defense names popped as withdrawing from the iran nuclear deal there's the ita shares, remitting an etf, space of 1 partnersh1.5% goldman added northrop as well you talked about, brian, what happens to defense from here it's not an undervalued space.
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>> absolutely right. the defense has been on a tear for over a year now, really, actually, since the president took office, read into that what you may. maybe that's what they thought we'd get to this moment, but, again, you're not -- you're not the first person to discover it, so in the same sector, you want to buy it, the one i pull out of there is boeing, and i know it's somewhat defense, somewhat commercial aircraft, but they have a lot of exposure to iran, and there's questions over that right now. >> but you -- so boeing would be hurt, though, because they have to pull back on the -- >> right >> saying if you wanted the shares don't necessarily buy boeing, that's the one that i pull from the basket >> oh, got it, pull out to avoid, not to check out. >> right >> okay. tim, what about you? >> i think that the defense sector is very interesting in the fact that these companies, especially northrop and boeing, i mean, these are companies that have been almost to perfection when they report, that not only
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tells you how the company should run compared to what they told you, but beating free cash flow, and beating all expectations, doing that for seven or eight quarters, so as brian pointed out, the valuations are not terribly cheap, but northrop is the best of the bunch, trading 19, 20 times versus historical of 16 times. orbital deal is a good deal and i like what's going on >> okay. mike >> mid-term elections trade down the point. democrats look like they gain, defense budgets will not go up forever. >> yeah, and then people get nervous. brian, kelly, tim, thank you for joining us >> thanks. >> much more coming up on "fast money" at 5:00 p.m. eastern time in 18 minutes. at 2:00, the president announced the u.s. pulling out of the iran nuclear deal let's get reaction from capitol hill, joining us in a first in cnbc interview is senator marquis, senator, welcome.
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>> thank you >> you're not pleased about the deal you think it makes the middle east much lesser a safe place? >> we're walking away from our allies, germany, great britain, and france we're walking away from a deal that was agreed to by all parties, including the iranians, we're walking away from the international atomic energy agency, which has been monitoring this agreement, and says that there have been no violations of the agreement. we're beginning a process of boiling the oil markets in the middle east because of the uncertainty, which is going to now hang over this region as we get deeper into the controversy, so i don't see a plan. i don't see a strategy i see a campaign promise which is going to be fulfilled i understand that, but the consequences here are quite serious. not just for peace in the middle east, but also long term for the
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economy because the oil issue is going to loom larger as each day and week and month goes by >> that said, the oil price declined today with plenty of critics saying president obama pursued this to shore up the leg -- legacy, and they then spend this money in places like syria still in conflict, so was that the outcome they looked for and a sign the deal is working >> well, you any, the congress, including me voted for additional sanctions authority on the president to take action where iran is moving into syria, iran is developing ballistic missiles, where iran is violating human rights we already gave him sanctions authority which he needs, and we did it on a bipartisan basis if he feels, as he says, that there are violations, there are
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activities malign that iran is participating in, and if he needs more sanctions authority, come back to us, but he's taking an agreement which is being enforced, and he's burning down the house in order to remodel the kitchen. you don't take something that's working and destroy it in order to make changes unrelated to the central deal >> way about the enforcement part of the deal which people say, look, there's not the access that you need israel, itself, came forward saying, look, we found documents proving iran lied about attentions for the program, in the first place going into it. is there a way to take concerns to change the existing deal or push back on the iran without the move the president made? >> well, the documents which israel produced dealt with what the intentions of iran had been. that's why we have this agreement. we have the agreement in order
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to make sure that there is a verifiable regime in place to ensure that there is no future weapons program inside of iran that has been established, and the iaea has access, ultimately, to any site they wish to gain access to in order to determine whether or not there is the violation. if there are individual sites where they are denied access, then they should make that public, and democrats and republicans in the united states will come forward in order to ensure there is political situations where that occurs, but that's not happened. >> finally, senator, what happens if iran, as they suggested, may now pursue industrial enrichment or along that path, even as it's apparently trying to salvage parts of the deal with europe without european violating sanctions. if iran goes to that path of
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industrial enrichment, what repercussions do you expect? >> well, i think if that's donald trump's goal, it's to tul out of the agreement where the iranians have agreed they are not going to enrich to military grade uranium, and then after we void the deal, they then move forward on that pathway, then it's a self-fulfilling prophesy, self-created crisis, which donald trump by his own action has created. so the correct answer here is to stop the agreement, stay in the coalition, honor the agreement, and identify problems in syria or ten years from now where the president has some concern where he believes that uranium enrichment is less controlled, we can discuss that, but that's ten years from now we don't have to create a crisis in the middle east right now
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that could quickly spin out of control. saudi arabia could begin themselves saying they need nuclear weapons programs if iran heads down that pathway, and that's one thing the middle east doesn't need we don't need a shite and sunni bomb in the region use peaceful negotiates based on what we already did with iran in order to accomplish that goal. >> thank you for the time today. >> thank you for having me >> senator ed markey of massachusetts. match reporting earnings, we'll have the details next. >>
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. welcome back a bunch of earnings coming our way beginning with marriot seema mody has details. >> hey, world's largest hotel change, slightly lower on trade week two guidance was a beat on earnings of $1.34 adjusted on revenue of 5.01 billion. revenue per available room basically equivalent of comp same for hotel sector rose 3.6% versus 2.7%. that growth driven by two factors. growth in the luxury sectors,
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ritz-carlton and overseas skberlly our development pipeline reached a new record of nearly 465,000 rooms and we remain on track to achieve worldwide room additions of 5.5 to 6% bottom line growth continues specifically overseas. back to you, kelly. >> shares down half a percent. seema, thank you match earnings in focus on facebook's surprise entrance into the dating game recently. eric has more. >> reporter: earnings surprising beat, suggested earnings better than $0.23 wall street expecting, earnings up about 3% after hours on top of being up 3% earlier today during the day. but the stock is still down about 25% from where it was just a couple weeks ago when facebook said they were going to launch a similar service. another comment they had, they are looking at guidance better than estimates looking at 1.6 to 1.7 billion
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for 2018 revenues. that's above estimates as well as for q1 quarter coming up. surprisingly a good thing. another feature, tinder users not signing up using facebook credentials. that might give a sign if people don't want to use it even for tinder. >> thanks. i don't know if that's a recent thing. >> disclosing that. >> people don't use facebook to sign up. >> definitely could be although, i do think match was a stock that was on such a huge role and people essentially said they were going to have this to themselves for a long time even though the results look great, it's 30 times earnings. still very expensive stock if you have a competitor coming in. >> up better than 4% after earnings earnings lower, kate rogers with update. >> stock down despite what looks
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to be a strong quarter eps, revenues $181 million, also a beat street projected $379.5 million. just a slight beat north american up, didn't know adverse weather impacts, 40% of their global system -- rather global system stores have been reimaged, new or renovated also reiterating guidance right now. the stock up 5.5 year-to-date but once again down around 3%, kelly, over to you. >> kate, thank you kate rogers for us meantime attorney general eric schneiderman resigning after four women accused him portfolio abuse. contessa brewer looking at some of his biggest targets on wall street contessa. >> reporter: yeah, kelly schneiderman likes to cast himself in the role of cape crusaders, routing out financial
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misdeeds the question is, since he's gone should wall street be breathing a sigh of relief i have more coming up after this directv gives you more for your thing. your... quitting cable and never looking back thing. directv is rated #1 in customer satisfaction over cable. switch to directv and now get a $100 reward card. more for your thing. that's our thing. call 1.800 directv. some moments can change everything. you can't always predict them, but you can game plan for them. for 150 years, generations of families have chosen pacific life for retirement and life insurance solutions to help them reach their goals. being ready for wherever life leads. that's the power of pacific. ask a financial advisor about pacific life.
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today's new york attorney general eric schneiderman's last day on the job he resigned last night after four women accused him of physical abuse he served as new york's ag for more than seven years. contessa brewer joins us with some of his biggest targets in business contessa >> yes kelly, eric schneiderman took on some of wall street's top jobs, top firms, landing big wins here just in march he had big settlements with swiss ubs and royal bank of skld over marriage backed securities over the financial statements his recent settlements recovered $4 billion
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schneiderman liked to brag, really, about himself as a campaigner, a guy on a white horse with a white hat going after financial crimes sometimes he got ahead of himself on the details of the case here he is with michelle caruso-cabrera with home owners who found themselves in trouble. >> they lived in their house 35 years, right >> i think it was 37 years long time. >> 37 years. most mortgages are only 30 years long when did they accumulate more debt >> they were involved, as millions of new yorkers were, in getting in dpduced into refinancing. >> couldn't have been refinancing, the mortgage would have been over they took money out, right >> i don't know how much they took out. >> shouldn't you know that that's the item you cite as the example of why they are doing this. >> we're not going after them. >> you used them as the example
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of why you need to take this action. >> yeah, the real question is who picks up the gauntlet, the new york solicitor steps in as acting attorney general. kelly. >> contessa, thank you very m h much contessa brewer. after business headlines, disney earnings, stock negative electronic arts after revenue beat $2 billion stock buyback and tripadvisor after soaring quarterly product. what stands out to you. >> disney reaction in another time it would have been pretty supportive now these are captive to the bidding war scenario now you have to know how the chess game is going to play out. >> granted disney holding up better than comcast in this bidding war with. >> disney has more balance sheet, more diverse sources of revenue and probably could raise its bid if it so chose
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i do think it's still going to be a question -- it's not a winners curse who gets the assets but looks like the market thinks this could be a messy battle. >> or curse for a little while before it plays out. there's disney tripadvisor some others to keep an eye on that does it for closing bell. thanks as always fast money begins now. >> overlooking new york city's time square. our traders on the square. tonight on fast wall street is running towards bitcoin and flood gates of institutional investors about to open. crito ballroom will break it down disney out with earnings volatile after hours, conference call with ceo bob iger under way. this as the mouse house squares off against comcast, our parent company, in the battle for fox jim stewart, the man who wrote the book on disney literally will be here to tell us what it


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