tv Squawk on the Street CNBC June 28, 2018 9:00am-11:00am EDT
money. i want to thank brian for being with us today. it's been great seeing you. >> this is like sleeping in for me. >> it's all going to get picked up right now with "squawk on the street." they will cover all of this through the opening bell and beyond thank you for being with us today. we look forward to seeing you tomorrow right now it's time for "squawk on the street. ♪ ♪ ♪ good thursday morning. welcome to "squawk on the street." i'm carl quintanilla, and cramer has the morning off. the pre-market gains after the dow lost the 285-point lead wednesday and stir in weakness for walgreens now as amazon makes a push at pharmacy and we'll get you details about that, and germany down a 1.5%, and final q1 gdp revised down to 2. we will begin with trade uncertainty continuing the trade on global markets and the
president's in wisconsin today to praise a chinese tech manufacturer in the same weak as repeatedly bashing harley davidson. plus the bidding war for fox. what yesterday's antitrust approval for disney means in that continuing battle between comcast and disney and amazon announcing plans to acquire online pharmacy pillpack shares of walgreen's, rite aid and cvs are all down in the pre-market futures down as trade war fears trade on the nasdaq is clinging to a three-point gain for the month speaking at a rally last night in north dakota the president made some comments on the trade battle >> if you're not going to treat our workers, our companies, our farmers fairly, if you're not going to take our farm product like we take your farm product then we're going to tax all of those beautiful mercedes benzes that are coming in and we will tax bmws that are coming in. >> the president heads to wisconsin this morning to tout a
new foxcon plant and the war of attrition between china and the u.s. continues shanghai down 23% from the highs and second bear market in two years down a percent overnight. >> china, the stock market there and the currency all part of a real huge pressure in emerging markets in general and to me that's the story if you want to say that's only a trade story, i don't think it really is, but trade and the n controversy around it and the fact that it seems an aggressive posture on trade seems like the goal in itself and we're not talking about the process or talking about anybody and it kind of feeds the same pressure points that the markets are worried about already, right which is fed tightening and tightening financial conditions around the world if you wanted to neutralize good, domestic u.s. economic momentum you'd send oil to 75 and emerging markets would have struggles and we would keep raising rates and all of that feeds the same kind of story. >> there's this narrative out
there right now. so yesterday was a weird day we had a 400-point swing intraday in the dow and erased gains and then ended with a big loss and the narrative is if trump softens a little bit on trade as yesterday's announcement has seen and then the fed can keep raising interest rates and you see groups like the russell 2000, big winner or technology big winner so that's part of it you've also got this quarter end, half-year end, rebalancing and trade wars, fears. >> i do think yesterday's early rally and reversal also told us that this market in the short term is capable of overplaying trade headlines to the upside and the down side. you had this sort of 8:00 a.m. relief trade when you had secretary mnuchin saying we'll take a less aggressive stance and it didn't translate into a longer term investment story it was a pop on trade. let's see if it holds. oh, no, big tech is still under
profit taking so the whole market kind of softened. >> what happens when q1 earnings start showing up as 20 and raise the guidance ondaimler and oracle and starbucks will set the tone instead >> i think earnings up 20, probably 20 plus a little bit if the pattern holds is going to be that kind of support that this all has been pushing against maybe this is just the fact that we had this intervening period of no earnings and corporate news is not at the center where the macro stuff is dragging down >> we're suppose to the get the part two of the stress test today after the bell and we'll learn about the capital allocations which are supposed to be quite good in terms of the return to cash and yet the banks are on a record losing streak when it comes to the market and if you look at the gap between the long-term interest rate any worries about profitability for banks and the recession about the economy and talking about the macro getting in the way
>> i don't think the earnings season is going to set asset this question of how closer we to this cycle decelerating i don't think it's critical where earnings season didn't blast us off to new high, but it kept us well supported if you look at the emerging markets and the u.s. market, it was in april that it diversed. that was the march fed minutes and the start of the u.s. earnings season all happened right there. >> the technical questions which we're trying to get our arms around in the meantime it is a big morning for amazon the company announces it's acquiring pillpack, an online pharmacy that offers pre-sorted doses of medications, home delivery and what they call a commitment to customer service shares of walgreen's, rigte aid
and cvs all down on the news it will begin offering incentives for entrepreneurs to set up their own small package delivery business. we'll get details from courtney reagan at amazon headquarters. we don't have information on the pillpack move. >> no. walmart had been looking at that time and that amazon had less than a billion dollars and a relatively new start-up and we have more questions than answers at this point, and investors perhaps not choosing to ask too many questions before choosing to sell the like of not just walmart, but take a look at cvs or walgreen's or even the pbms home delivery of pharmaceuticals. that's kind of what we're dealing with and the online pharmacy presence is here. it doesn't necessarily put them in business in terms of the pharmacy benefits management business or, you know, or in the drug distribution business, but again, it would create, it would seem, this online pharmacy presence some time back, freedom of
information act, requests states from investors who were trying to understand what is amazon after in these states because it did file for licensing approval, but it was devices it wasn't to sell pharmaceuticals. not quite sure how this changes that and the multipacks typically for people who take pills. >> amazon officially enters the pharma business, right >> right. >> and that's scary for these companies. >> at this point, the first segment of the customer base yet. does it fit well into prime? if you are someone who is always taking multiple pills. >> we're talking about a company that may have had less than $100 million in sales versus cvs. amazon is good at scaling things and they're better at scale than pretty much any other company
that we've ever seen. >> the managers apparently in the cnbc.com article they outline the dispute that pillpack with express scripps and in that it was revealed that express scripts accounted for a third of its revenue so very important in the this whole partnership. >> by the way. the drug supply chain is a $3 trillion market. our meg terrell has more on the deal and can help us understand what it means to amazon and some of the other names good morning, meg. >> good morning, guys. talk about a huge, term, and the colleagues at cnbc.com had reported in april, christina farr and lauren hirsch i'm not getting the amount that amazon will be paying for pillpack and it is down 8% for some of these huge pharmacy clains is still remarkable and it shows the nervousness around amazon coming in and that had
abated a little bit after christina farr had rored theport amazon was backing away from this space and it decided to build it internally and maybe this way it's buying its way in. there was a major question about the licenses that amazon would need in order to operate in this space and the pharmaceutical space and the pharmaceutical distribution space, while there was initial confusion about what those licenses were that amazon had, it did become clear that they were not to operate in the space and it was for the existing medical businesses. so there is a question here, is this just the beginning and clearly, that's what the market is worried about for all of these sectors from pharmaceuticals to drug distributors to pharmacy benefits managers. you ask anyone in the state about amazon they all want to partner with them and they all try to downplay the impact amazon can have in this space and it's the pharmacy cvs and the pharmacies
and walgreens that have the impact >> apparently pillpack does hold these pharmacy licenses in all 50 states. conceivably, if that is correct this is a way for amazon to sort of deal with that licensing issue one time through acquisition. >> absolutely. that was always sort of the question why not just buy pharmacies that have these licenses and then they would be set up and ready to go. this seems like a relatively inexpensive way of doing that and from there they could potentially scale. we're all digging on this and trying to get more information and clearly that's spooking people. >> meg, the ceo of pillpack was on squawk. this was december of '16 and tried to explain exactly what the company does. >> it makes it simpler and easier for folks that are taking multiple medications and we presort, and deliver them to
their door automatically on top of that you have pharmacists that you can talk with on your mobile phone and it's a much better solution for people managing multiple m medications. >> is the demographic, the target demo an older audience? >> certainly that's what implies and that's amazon has said its interested and on it's a huge audience that needs help in managing cost and managing this from a consumer standpoint that's a really big consumer group for amazon to be going after. >> i think the battle between online, and walmart, and amazon gets pillpack. are there competitors out there? are there other companies that do that? >> i believe there are i have to dig deeper who walmart will be going after as a result of this, i'm sure. >> we should point out, meg, cvs
has run a multi-dose pilot and walgreen's offered it for some period of time after they acquired a company called daily med. it's not that hard, i guess, this kind of technology. so see if am one will popularize this and brand cvs increase that pilot or re-enter that idea of a business. >> yeah. absolutely, and cvs has been emphasizing same-day delivery and improve its consumer offerings and it's something companies are improving on and it seems more real today and that's going to increase these companies are doingthis and as you point out, perhaps the technology is not that complicated, but the licenses are an important part of this, too. >> i was just going to say, from an investment point of view, i wonder how the muscle memory works with regard to the amazon
panic because you did have a similar response and they were cheap and they got cheaper and now they're back to the pre-whole foods highs for many of them. >> cvs and walgreen's are very low, multiple stocks and people feel as though they're still the easy core businesses is there for the picking. >> they did pick the wrong week to add walgreen's. >> everybody is saying it's time to take it out >> that's the irony, right people are saying you should add an amazon to be reflective of the economy and obviously the share price is too high. >> and the dividends. >> and you are threatening walgreen's >> and maybe this is a probationary period. >> look at ge, and it's been the best week in i don't know how long either. >> it doesn't help when walgreen's had earnings and they were expected to be positive and retail comps were negative and they announced this big cash
return and the $10 billion share buyback and the 10% on the dividend on lower taxes and thank you to the tax cuts. >> and big buyback over in walgreen's as well meg, thank you our meg tirell scott law is retiring, and he's been on the job since '14 and it comes the same week that schultz officially steps down. kevin johnson putting his team ago the over there shares are near a three-year low after the guidance from last week. when we come back, a big morning in media details on disney/fox. we'll talk to the ceo of bj's wholesale exclusively as his company is set to go public at the nyse pricing at the high end of the range dow coming off the lowest close since may 3rd. s&p lower since may 39 we're back in a minute still a chance here.
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just about ten minutes to the opening bell and let's get together with art cashin good to see you. good morning >> good morning. >> in january we talked about markets where the dips were quickly bought and now we have a market where the gains are quickly sold what does that mean? >> you are still grappling with the end of the quarter and the end of the half and people are trying to figure out how to both rebalance their portfolios and secondarily, how to prepare themselves for what may or may not be happening in the trade wars, as the days with wear on
we're finding out more and more things for example, one of the key areas that china was going to quote, unquote, punish the u.s. was in an area like soybeans and now we're finding out that china's need for soybeans may be greater than they can satisfy somewhere else so i may impieose tariffs and we might have argentina and then deliver them to china. more importantly, however, we are finding out that china imports so little from the united states that they can't put on tariffs big enough to really make a difference so that's bringing us to sarah's favorite area, currencies and it may mean that they will use their currency to begin to punish the u.s that's why we've had some of the afternoon destabilization we've had recently >> the journal looks at non-tariff options and they argue that they'll dump treasurys, for instance. >> that will be self-punishment,
but by simply stopping buying, however, that will help raise rates here and move things up and they can hold for different times. more importantly, there will be this currency thing and where that winds up going and you're seeing that affect other markets and the emerging markets area and pulling back and worried that a currency destabilization out of china is going to change all of the emerging markets and we're into kind of a new phase of the trade wars and that's why every time the market seems like it's found a bottom and it's ready to move, not going to happen >> brings up the fact how the last time we find it devalued with currency and it's across world markets including the s&p and the correction and the dollar is getting pretty strong here on a day-to-day basis is that going to start to hurt earnings and the economy >> it is i think you're already seeing it
as a factor as i said earlier. the strength of the dollar and a fear of an overt move by china and currencies has the emerging markets moving around. so you've got all of the pieces juggle income mid-air and it's tough to settle it down. >> art, the financial stocks, is it pretty hard to -- and the european financials obviously, with deutsche bank hitting new lows how does that turn to the whole story? >> well, you're right about the european banks, et cetera, but financial groups for 40 years and if you look at the etfs and other things, they've been down for 12, 13 straight days you don't see that kind of performance. now in the past when you've seen something like that, they don't turn so rapidly. they eventually do, but they don't turn rapidly, but what you need to do is find out what's
happening with the ecb and the european banks and then watch what's happening with the currencies and the emerging markets. that will affect all of the financials and we're flattening that yield curve even further here >> our thanks. see you soon art cashen we are counting down to the opening bell stay wh o"sawitusn quk on the street." ♪ ♪ ♪ south l.a. is very medically underserved. when the old hospital closed people in the community lived with untreated health problems for years. so, with the county's help we built a new hospital
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talk with your advisor about shield annuities from brighthouse financial- established by metlife. ♪ ♪ you're watching cnbc's "squawk on the street. live from the financial capital of the world, the opening bell in under three minutes tension taking a backseat to sector-specific news, in this case amazon dipping its toe in the water of pharmacy delivery buying pillpack and that has pharmacy names under pressure today along with watching europe, eu summit, they're trying to put together some agreement on immigration and migration. we'll get the president at foxcon today talking about employment and foxcon based in
taiwan >> except he'll be talking about it which is a little bit ironic because you have harley davidson moving production overseas because of the whole car threat in the eu. i will also be watching the automakers and especially the automakers that have been under pressure we heard president trump talking at a rally in north dakota threat edge the mercedes and bmws of the world, and this is a big chunk, we import $360 billion worth of autos and that's a good chunk, that's 12% of our total imports and 2% of our total gdp. this is one economists are really watching to see if it escalates because so far you heard the tariffs are a small chunk of the economy and the tariffs won't really have a hit in the economy and that changes i think, if we have the autos. >> and it is the big of the retail sector, and i think the question is it's just kind of slows down activity everywhere
and it's a net loss for consumers and the industry and it's not as if you will have lots of production moving here in any reasonable timeframe, right? even if it suppose lead worked as promised, it's such a long week and so much pain. >> if you see the toyota statement came out last night warning and clarifying that we have $137,000 american jobs supporting families and working for toyota and toyota and lexus dealership they're not a luxury security threat and we are an exemplar of manufacturing in america and it will raise the cost for u.s. consumers if we do see these tariffs go through >> we'll continue to watch the banks as we were talking with art cashen before the bell slx, the financial down 13 days
and not as much of a decline in that span as we saw in '08 where we saw a fifth of the market cap over 12 days >> any pressure is -- [ inaudible >> tonight the fed will release the final results from those tests and we'll see if financials come down in the wake of that. there's the opening bell the s&p at the bottom of the screen brightview celebrating its ipo and over at the nasdaq, everquote, an online insurance marketplace. so the initial dow weakness, down 36 will be with walgreen's. 1.53, it did beat by a nickel and the $10 billion buyback and the dividend goes from 40 cents to 44, but as usual, amazon
carries a big weight >> and some of the components were a little disappointing and the com store sales were down 1.2% and they're expected to be up 1.5, and pharmacy was flat. so overall, you know, not a great day for walgreen's and there's another dow member and that would be nike which has been a solid outperformer so far this year and it's the second best performer in the dow jones industrial average, up 14% so there's high expectation for nike tonight and the higher valuation than we have seen from nike going into earnings i will warn you, nike's beaten bps numbers in 20 of the last 20 quarters and inside those numbers, investors will be looking for an inflexion point in north america that has been weak for nike and it's the most important and biggest market that represents more than 40% of sales investors want to see a turnaround to growth in the
market and there are better retail sales that we saw from department stores and footlooker and weakness in adidas that nike can grow its sales there and the other one will be china which has been the growth driver for nike double-digit growth for the past few quarters it represents a big chunk of sales and people are worried about a trade war. so far footwear and apparel has been left out and consumers are not targeted and nike is a company you want to watch. >> nike is up 14% year to date, so clearly, a lot of the trade noise is not investors in the category and it doesn't seem like we're talking about making clothes and shoes in the country again so it's a little bit off to the side. >> but again, if you start to get to the point where american brands are tarnished and the reputation in places like china it's been an important driver and any commentary on the leadership changes and you caused the mass exodus of nike executive over the past few
months as hr review has wrapped up and last quarter, the number two was not on the call and you won't be obviously again and you will hear what the ceo says about that and how the transitions are under way and they're still trying to reach the revenue target of $50 billion. s&p right at 2701 we have interesting calls. the price target 152, doesn't move the estimate that is mostly a higher confidence and sustained revenue growth and over at ibm, i know mira initiated the buy 160 target and that's at 11 times they argue that strategic imperatives down nearly half of the business and growing at 50%, with clouds analytics. we'll see. >> the initiatives have slowed, but it obviously was expected to become a larger and larger
portion of the overall, moving in somewhat of a direction they hope when they initiated this strategy a number of years back. >> comcast up a percent. >> yeah. we'll talk about that in a bit >> we will wait a little bit and go through all of the different ramifications. >> i was going say the financials and they are trying to bounce ask j.p. morgand j.p. was leading and the emerging market indexes have gotten stretched so far to the down side and you had huge outflows and the question is if they'll have to converge between emerging markets and the u.s. to some degree, how will that happen can we finally wait it out until emerging markets, and i think it's not clear right now, but if there would be a bounce it will happen soon. not unrelated and it was
yesterday and that's 3% on top of the food day and the highest close in years for the price of oil and energy has been rocket fuel for this market in terms of the sector performance and some of these energy stocks oil is weaker today, but there you go, it just looked positive. >> the saudis can truly make up for the loss production from the likes of venezuela, iran and mexico to some extent or how long can they continue to pump at that level and even the saudis can get up when the quality of oil is less than people want out there in the marketplace. so there is at least this question, and is it just never-ending or do they even reach a point where production can be constrained a bit. >> the market is in those modes, and when the market is already kind of under a lot of pressure and then it's a matter of, well,
look, they can just keep the taps open. it's a perception thing. >> also, based on some headlines that the u.s. is telling its allies to stop buying oil from iran or face sanctions i mean, i wonder if it was like saying that some of the allies would keep trading with iran even though the u.s. pulled out of the nuclear accord because the two and a half-year high suggests that that was not priced in. >> gas at $2.85 is nowhere near where it averaged in the early part of the decade, but at these levels it would offset about half of the tax cut benefit to the lower half of the income spectrum by the way, today is the six-month anniversary of the tax cuts you will hear about that from the white house. es it lal be in focus and the journal with the big profile of elon musk as they're trying to get out of what they call production hell. 50 high-ranking executives have left in the past two years some of them to citi, and
there's this view that even if they get near the 5,000 target, because that's a success in some way. >> he admits to having made mistakes and they have overuse of robotics and the fact that they had to pull back and a lot of this we've already known and sleeping on the factory floor, under a tent, and the tent they put up to speed things along >> the stock doesn't back up >> people feel like the 5,000 are on the back and the shorts are on the run and that's part of the narrative it's a tremendously face nating sto fascinating story and the fact that it's a $60 billion company, and we're talking about can they bang out 5,000 of their next hundred in a week and it's an amazing story and it's hard to handicap, and even if they say they need to raise more money and if they do it from a position of relative strength --
>> the lack of a discussion about porsche's plans and bmw's plans. is there a blind spot for those who are supportive >> it's like the demand side was taken fully for granted and what are constellations, right now, it's 5,000 >> oil keeps going up and that only helps the demand side, but to your point, carl, bmw's high-end automakers with what will be conceivably competitive vehicles in the market. >> if you're on the waiting list for a 3, at what point do you say, you know what i will cancel and go down to the porsche dealer and see what they've got. >> what is important to me is how much of the tesla buyer will say i want to buy an electric vehicle, which one will i use? and i want a tesla there is a cache and that is unclear in term was how many
they have on the road and the bulls in tesla will tell you that tesla has had so much data, that it's for the next wave of semiautonomous driving and that's a big picture stuff. >> i wanted to point out a big winner in the consumer staples, i always talk about no growth in the food companies it's not the case for mccormack, announcing 19% revenue growth. a big beat on earnings, and 9 centers above estimates. this is a company that is bucking the trend of overall slower growth and how are they doing it spices, guys and frank's red hots i don't know if you use that, but they've made acquisitions on that and selling like craze py. it's red hot, if you will. >> mccormack is number one on the winner's list today.
let's check in with bob pisani this morning. >> i just want to start with the ipo. the pricing overnight, my head's been spinning here let me show you what's going on. we have bj's, the big one today and that is at the highend and $37.5 million and already we have indications of $18 to $20 and this is the big membership club 200 stores around the east coast. it's a well-known company here and the bad news, and a lot of debt and this is a big ldo and lots of competition and slow growth i think it's fair to sayy 18 to 20 is good we have another one over here and i want to point out, bright fuel, we don't have indications on it and it is a big provider of commercial landscaping services and they're the largest landscaper, $22, and thanks the low end of the price talk, $22
to $25 this has been a rather remarkable day and a remarkable week, and for ipos and let me show you what's going on here. i'm still waiting for the final numbers to tally up and we've had at least 13, possibly 14 coming here and we have a lot of good ones here >> 27 to 29 since the month of june and that's been since 2015. >> we had four bioteches and they all did very well and the insurance auto marketplace from the nasdaq hasn't opened yet bj's we're waiting for that to hope and that's being looking good and the only one that did well is the international shipping companies that was postponed due to market conditions and there's a comment on the global trade issue. the one other ipo postponed right now. looks like we'll have the busiest month for ipos since june 2015 in the business week
in a long, long time let me just start to give you a quick show of what's going on with the sectors here because you can see a lot of movement right now going on important here, utilities are defensive on the start techs doing okay, energy, consumer discretionary and healthcare weak and that's on the amazon announcement earlier today. important buying pillpack. i want to show you one last thing about the second-half worries and the five-day worries that keep getting over and over. the trade war impacting earnings for industrials and materials and technology and that's a flattening yield curve dollar strength and slower european growth and earnings and the china slowdown on cnbc.com for more guys, thank you. bob pis an owe tani on the floor we are less than 24 hours since disney got a quick approval to
acquire the fox assets from the department of justice. just six months and 13 days after announcing the deal it was approved by the doj and of course, this then leads to the question what is comcast going to do as it tries to potentially come back to compete with the $38 half cash/half stock offer from disney that now is cleared in the united states more on that in a moment, but from comcast's perspective, yesterday i shared, you know, from people familiar with the thinking of the company that they were prepared to move ahead, perhaps not this week, but in the near-term to try to counter disney, but you know, seeing the reality of that doj approval is unclear whether that has any telling effect or meaningful effect on comcast's thinking as for disney, well, it was the offering of the rfm, and we don't need to have a discussion about this, and we are willing to invest all 22 rsms and what about the doj to look at and the
studios and we have been reporting, and you look at fox and disney and get a big number. how many studios will be left out there. six or seven, you could argue, and amazon and netflix will produce major motion picture and he would love it to become major players and doj said fine and you're left with nat geoand eff. they're significant cable networks and do they move the needle to give to the distributors scri scripts in discovery took six months and this took six momgs and 13 days to get that approval for comcast, it says you have to deal with a $38 bid on the table that's already been accepted by the fox folks and the fact that they have a hand in saying there's no risk anymore for regulatory here. yes, they still need china other
jurisdictions around the world that's not insignificant, but they have an advantage and a certain advantage as well. so if you're comcast the question is what's the number? what does it need to be to get the attention of the fox board or is it possible the fox board will still not say yes, but you can still prevent shareholders to vote on the deal from saying yes, as well those are the key things as will disney wanting to move as fast as it possibly can to secure the sec review and the stock team and get a shareholder vote on the table before the record date of may 28 runs out and that would give you to july 28. they'd love to do that and we'll see whether, in fact, that actually takes place as for comcast, it is meeting with the doj as i reported yesterday. they've had questions as to whether comcast will move in and try to move the process as quickly as possible by saying they'll get rid of the rsm and
they'll get rid of hul yu and broadband as they decline the offer of broadband services. there's more there for them to deal with and so the question is where do we go from here and do they turn their attention to sky where they have a deal already in place at 12:50 that's been approved and they can move quickly under the uk and taking the laws to get that moving and put pressure disney and fox. so we'll see >> how bad do they want it >> how bad do they want which? >>. >> 21st century. >> they want it pretty badly and at some point reality creeps in with the difficulty of pulling it off to get to a number that really would be competitive given the disney strength right now. >> let's head over to the bond pits and check in with rick santelli in chicago. good morning, rick. >> good morning.
one week tells you quite a bit of information we've been on a downward drift for a while here, a couple of weeks. nothing huge, but all of a sudden we find ourselves looking at a chart starting in mid-may we hover at one-month low yields and we want to pay close attention to the levels in the mid high to mid-270s and we're half a dozen basis points away and if you look at year to date of hyg and that's a high-yield atf and very good support and this, somehow is kind of like a barometer for sentiment in the marriage between fixed income and equities the investment grade lqdef looks completely different and it's building and wants to do better. many are spreading the two against each other look at a mid-november of the dollar versus the yuan, and that's the chinese currency because we moved this week from the very end of december and now
all of the way into november, the 21st to be exact the last time the relationship was priced at these levels and by the way, today is the sixth straight session, the chinese currency has lost ground against the u.s. greenback and finally let's look at the greenback and last july and you can see how solid the dollar index is trading and of course, with the holiday session and a half year end of quarter, many are going to be watching some moves that may be counterintuitive. as for the dollar index, one level to pay attention to, say traders, 95 in the dollar index. carl, back to you. >> rick santelli, still to come, we are awaiting bj's wholesale set to go public at the nyse the ceo will join us exclusively on "squawk on the street." dow down 113 right at 24k and we're below 2700 on the s&p. back in a minute
or even using those hard-earned points to squeeze in a little family time. no one has your back like american express. so no matter where you're going... we're right there with you. the powerful backing of american express. don't do business without it. don't live life without it. ceo of walgreens getting asked about the amazon deal. he says he's, quote, not
particularly worried about the deal between amazon. it's open at the right price and also adds the pharmacy world is more complex than just delivering pills walgreens down about 10% not the only announcement by the way. courtney reagan is live at hq with an entirely different story. >> that's right. amazon already has its own planes and trucks and now it's building its last delivery service. so the e-commerce giant is officially recruiting delivery service partners individuals that will run their own network up to 40 local vehicles delivering pack ajs starting their day at one of 75 amazon delivery stations in the u.s., getting packages and routes from amazon, which all comes from an algorithm that determines where the the passages go, to amazon or one of their oh delivery partners like
fedex, usps or dhl the senior vice president for operations says he's not looking at ending his partnership with any of the delivery partners, but this is really about scaling cost effectively we know that amazon b spent $22 billion on shipping. that was almost double what they spent in 2015. so maybe this at least in part gets them closer to gaining control over the cost and the customer service we reached out to the service providers and so far ups is saying that it does closely monitor customer competitor announcements, but it's confident in its strategies. back over to you >> thank you very much as we go to break, a great cause to tell you about today p we are auctioning off a chance to come down and watch the show live you and three guests you get to meet all of us. the experience is being auctioned off to support a wonderful charity. it's run by our former colleague
and his wife, which supports creativity as a tool to empower children to bid go to chatyzzomribu.c there's one day left to bid. dow is down 68 "squawk on the street" is back in a moment. that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow. your insurance on time. tap one little bumper, and up go your rates. what good is having insurance if you get punished for using it? news flash: nobody's perfect. for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. switch and you could save $782 on home and auto insurance.
stocks rebounding from a quick dip. two ipos we're watching closely. set to go public we'll hear from both ceos when "squawk on the street" continues in a moment. introducing e*trade personalized investments professionally managed portfolios customized to help meet your financial goals. you'll know what you're invested in and how it's performing. so you can spend more time floating about on your inflatable swan. [ding]
welcome back to "squawk on the street". a little action to start this thursday morning dow was quickly down more than 100 30i7b9 points. s&p at the 100 day average of 2700 and interestingly, pharmacy in the middle of the news >> et we begin with the uncertainty we're seeing in the markets as investors weigh the global trade concerns. sitting down with us in a moment >> big day for ipos s we'll talk to the ceo exclusively later on this hour >> and after the doj gets its approval of disney's deal to buy the fox assets, what's next for comcast and the media landscape? we'll talk to jim stewart in a
minute so walgreens came in with earnings of 153. shortly after that, actually exactly as the conference call was about to start, amazon announces they are buying pill pack it's a company that delivers presorted medications to obviously an older demographic with that, rite aid, walgreens, all down between 2 and 8%. >> amazon's official debut something that was long speculated on, but i guess the counterargument would be high. you had to get the approvals. although it is important to point out they do not handle all fapharmaceutical ps.
but they do have licenses to distribute farm spharmaceutical5 states the company has not been around that long. walgreens according to our own reports had been taking a close look at it they are going to move more aggressively to serve the demographic which is an older one, which is delivering pharmaceuticals on a daily basis. >> which can be complicated. >> and is having enormous impact on walgreens, cvs, far above what you might anticipated given how large they are versus pill pack but amazon does scale quickly. >>.
>> another target that was the focus of both amazon and walmart at the time has all the background and can tell us a bit of the history and what it means now. >> watching the stock reaction this morning clearly this is a big fear about the entry into pharmacy distribution like this means. there had been that fear and now it seems to have come back so amazon purchasing pill pack this is a company that aims to serve a population with a will the of prescriptions to management sometimes difficult to manage. often it's hard for them to get to pharmacies so this is a way to really manage those in a customer focused way for those patients you can see the impact this is having on pharmacy chains. walgreens down more than 10% cvs as well this morning interestingly from the release this morning, pillpack's ceo
signaling, we are eager to continuing working with partners across the industry to help people in the u.s. to benefit from a better pharmacy experience the questions are going to turn to what this means for the pharmacy space the ceo was asked about this this morning on the company's conference call. take a listen to how he responded. >> we don't see any of these on these. we are not complacent. we have a clear plan and i believe we will continue with the execution of our plan. if we did just under the pressure of the motions without respecting our financials, we will destroy value >> so kind of reiterating some comments he's been make. ing for awhile about questions about amazon entering the spacing. we're not worried.
this is a very complicated space that's always been their response to how much scale they could get here clearly companies are responding to the threat of amazon. interestingly though adam fine telling us this morning that the pharmacy industry has entered its next phase of evolution. he says he expects a pharmacy shakeout over the next five years. this is having a big impact this morning and we'll be hoping to learn more about it as the day goes on. back over to you >> i'll take it. i have a question for you too. $6 billion from walgreens market cap for a deal that cost amazon less than a billion. if we don't know what the numbers are. even though they are not moving into drug distribution per se as much as online pharmacy. but as i pointed out earlier, cvs has a pilot since 2014
>> you would think one of the barriers to entry in this space and i got off the phone just a little while ago with george zachary on the board of pillpack. i asked who are the main competitors here why are cvs and others not in this space that's an older model and not something they were focused on they came in with an e-commerce model and tried to solve a specific problem the question people have been raising this morning is one of scale. this is a very intensive model, personalized for each patient making sure they know how to take their pills and package in them in the right way for them so how this scales for amazon is going to be really interesting question as well >> ongoing u.s. trade tensions continuing to weigh on stocks
around the globe as we get set to close out the first half of the year this week, the dow and s&p both lower for the month the chinese currency is dipped to fresh lows against the dollar joining us is the co-head of the resear research is china using the currency card to fight president trump in this trade battle >> we have had a lot of conversations with investors in the past few days. we think the answer is no. what china is doing is passively allowing it to depreciate. just a couple data points here that's roughly in line with why the trade index. the reasons ween adopt think they would use it as an offensive weapon are two-fold. if it was a sudden devaluation, that would be a et red flag in front of a bull.
you'd have an escalation so you would not achieve the objective you're aiming for. you have to remember when they had devaluations in 2015 and 2016, there was an outflow of market cap pressure because expectations change. we don't think they want to go near the pandora's box it's toxic factors we have discussed about previously so trying to do the right thing to cut down on banking but that's constricting credit
>> from a trade perspective, i think i'm not sure it's going to be offensive the feedback we're getting is we don't want to fight, but if you confront us, we'll meet you. they were on tape talking about not turning the other cheek but punching back. there was a meeting with ceos in beijing a couple days ago. so the sense we get is china will try to match u.s. or not appear to be backing down. the key question is how could things resolve somewhat in a face saving agreement to have a combination of number one, china buying more stuff from the united states, which was discuss ed number three because you can't senatnarrow the trade deft in one swoop
and probably number four some sort of action or greater combination. >> you see that coming in the next six months? >> obvious date to look for is midterm elections and an agreement before that. that's not a guarantee if you wanted to have some sort of rational expectation having an agreement negotiated before that would be politically acceptable as long as from a face standpoint that would be palettable to both sides >> specific to the back to the banks and recognize iing what ws more lending that should have taken place over a long period of time. what do we make of the decision to lower the reserve requirement? >> if youing a gait that into bank lending and shadow banking, the main components are the first two.
it's shadow banking. it's clear from the data the policymakers are cracking down on this less regulated wild west shadow bank taking place in the long-term that's what should happen. in the near term it's constricting credit and investors are concerned about that and you're getting the downward fuel selling in the asian market >> to wrap it up, it sounds like you're optimistic there will be a grand bargain here when it comes to china investors want to know how much damage and pain will be leading up to that point how bad can it get for both sides and both economies >> i don't want to sound polly an anna there's risk for the downside. spot check things, $50 billion in tariffs is not going to move profits prafts with the market is pricing is like today's weather and the
threat of rain or thunderstorms. and that could get worse depending on how the rhetoric escalates. so that could be against a situation causing the downward spiral our sense here is it's going to stay choppy in the near term because it will be unclear evaluations coming down to 11 times earning. >> thank you so much >> when we come back, the wholesale going public the ceo will be setting down with us for an exclusive we're back in a minute with the dow down 58 points one second. barely enough time for this man to take a bite of turkey.
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we'll talk to both ceos here >> as we await that, let's get to the spotlight we're taking a look at chinese versus big tech. >> it's interesting. that tracks the sector nasdaq 100 over here dramatic under performance in the tech stocks. if you look at the chart it really started back in march and april in that area that's when trade tensions did start to flare up and started to seat effects in markets. what's fascinating is the companies that make up the tech sector are not export oriented at automatic if dwrou look at what's under the hood, it's 20% of the fund it's chinese fang serving a chinese market and the rest of southeast asia it's another 9%. so what it suggests to et me is
that it's really just all about capital flowing out of china it's the currency moves are representing that as well. it's unclear how long the relationship will stay between big cap u.s. tech and chinese tech that is is 10% made up, which nobody really thinks of. they think they are buying emerging markets very much an export oriented world. it's not the way we're set up right now. >> it has its own big names. it's all blur that has everything tech or at least a market values tech
he writes the songs. rite aid testing out a new tactic to deter loiters in southern california. rite aid has begun to play a new song specifically in stores in san diego, hollywood and long beach. the strategy seems to be working. but shome shoppers are asking if it's the lesser of two evils will this go national? a spokesperson said we are in
the early stages of exploring this approach and have not made any decision about the potential rollout of this to additional stores >> you could ring a bell loudly. that would be good too maybe they will play the eagles. >> i didn't realize people hated barry manilow songs that much. that's a good oldie. >> we obviously got an open for trade on bj's wholesale. up 25% here. the ipo today, the retail market the wholesalewarehouse club model. and the intense rivalry between them and sam's club. >> an interesting history. they were public before in 1997. then was taken private in 2001 or so.
and now announcing their debut the model is recurring revenue paying subscriptions and getting cheaper prices they say as much as 25% cheaper on everyday items. >> private equity will own the company after the ipo this morning. >> chris baldwin will join us after the break. don't go away. ♪ feel that? that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible.
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bj's wholesale going public. the stock opens up a few moments ago up 24% a massachusetts based retailer prices at 17 now up above 21 joining us for an exclusive is bj's ceo to discuss the ipo and how the company plans to take on rivals like costco and sam's club congratulations. >> an exciting day for our company. >> what does it say about the
warehouse club model right now the biggest thing is the consumer in the united states is in good shape. and discount retail works. when you add a membership model, the business is healthy, vibrant and growing. >> you make a big point about your geographic territory. in the northeast >> we are inspect. >> what's important about it >> our geographic scale in markets like new york, new england, down the east coast is how we run our company and we're encouraged by the opportunities to grow from there. >> but where to? >> we'll see over time the opportunity we have to deliver value to consumers in different parts of the country sen couraging for us >> carl mentioned some of the competition in terms of the warehouse clubs. what about amazon? how much do you compete with amazon >> i think any retailer who says that they don't compete with amazon isn't being truthful. so there's no doubt that the consumer is getting great value and great. convenience, but in the world we're living in today, value retail works
and membership on top of value retail is a business we feel great about. >> i mentioned rlier 25% lower prices >> we generally price it 25 to 35% grocery stores in the geographies and that's a big part of how we drive traffic and in the consumer environment. it's a really terrific business. our ability to continue to do that is important to our future. >> give us some specifics as to what you find encouraging as you indicated the potential for expanding geographically what are the numbers that you look at that say this would be a good idea? >> the idea that the consumer environment is as strong as it is, wage growth is good for the consumer the fact that the consumer is winning as more and more pricing becomes more and more transparent that's good for consumers and in our view, transparent pricing is good for our company because when people
check us out our prices are better than most in that environment, we believe we'll be able to serve more consumers over time. >> do you believe you have the capital to grow. i would assume this is for deleveraging this is the case for the company. you obviously will still have a good deal of debt on your balance sheet. do you have the capital you need to actually make the investments you're talking about the profiles of this business are good we're encouraged by our ability to perform >> where does e-commerce stand on your list of priorities how should we be looking at that when you report on the quarter and is it different in wholesale or warehouse than it is for other retailers in apparel >> i think it is a little different. the lens through which we view our investments is about making the trip more convenient we can go online and place an
order and have it this your house in hours so our ability to continue to make the trip more and more convenient is something that we feel good about and with some of the competitive environment that's going on, the world of delivery is becoming a fa fascinating source of innovation for all retailers. >> you think it's surpassing >> things will come and go but delivery seems to be the issue of the day and once again to joe's question earlier, the consumer is winning. and we believe we're well positioned to win in that environment. >> on the online front, you have more than 200 warehouse locations. how much business are you doing online from that do you ever partner with an e-commerce company given you have gotten such a big presence in the retail? >> the opportunity to do that in the future are significant so far we have lunched a terrific deal with insta krart
cart we feel good about the early read there >> this was a public company once they do a the lot of things to improve the profitability. what were some of them aside of putting debt on top. what did you do during this period that is enabled you to be a better position than last a public company >> private equity has been a great steward of this company. over the course of the last serve years, they have made major investments in putting in s parks. it's dramatically better than where we were seven years ago and we're encouraged by the ability to use that. >> any pressure?
how do you feel it >> we ship full palettes and trucks all the time. and as a competitive advantage it's a big part of our ability to operate efficiently and we work hard with our suppliers to continue to do that >> international in general tends to be a low priority i imagine it's the same with u you. >> we have plenty to do here in the united states and we're not going to do anything outside >> can they expect one >> stay tuned. >> are you finding the workers you need wages going to be an issue for you? >> certainly there's no doubt that with low
unemployment we deal with wage pressure we tend to think about it on a regional basis so our ability to deal with those issues locally is something we have been doing for a long time. we treat our employees well and will continue to >> thank you for coming in >> thank you all very much >> a nice open up 22% >> thank you let's go over to sue to get a news update. >> good morning, everyone. here's what's happening at this hour president trump and russian president putin will meet in finland on july 16th the president says they will discuss syria, ukraine and many other subjects president trump tweeted that, quote, russia continues to say they had nothing to do with meddling in our election, end quote. defense secretary james mattis meeting his south korean counterpart. they will maintain troops on the p peninsula. >> the commitment to the republic of korea remains iran clad and the u.s. will continue
to use the full range of diplomatic and military capabilities to uphold this commitment this includes maintaining the current u.s. force levels on the korean peninsula >> prince william touring holy sites in jerusalem and paid a visit to the tomb of his great grandmother. she saved jews during the holt ca holocaust. that's the news update this hour back down to you, david. >> i will take it. thank you. new pressure this morning for comcast to potentially up its bid for the fox asets. this is disney's competing bid after the media giant agreed to sell all of fox's regional sports networks. fox shareholders still have to weigh in they don't have a vote set as yet. joining us from out west this morning is jim stewart
author of the book disney war. i et know you may not have been covering it minute by minute, but you're a student of antitrust and have been talking a lot about it 6 months and 13 days to approve this deal. was that quick to you? >> that is pretty quick for a deal of this size. given that it's in the media sector has complex elements to it it's a lot faster than the justice department moved on the time warner et recently. i just getting the feeling that there's kind of a warm andfuzz feeling from the trump justice department towards this deal towards fox and disney that we certainly didn't see in the at&t deal >> as we pointed out, the willingness to divest those may have played a crucial role it's about the international
assets you have any expectations of -- go ahead >> i don't think there are any serious antitrust issues here. i didn't think there would be with the comcast deal either, although if they want a slow walk a bid they can do that because of the bigger vertical issues and disneyen did you want really pose that they are developing their own over the top thing. so i don't see an antitrust thing so i just get the feeling here and given that the president called to congratulate him when the deal first was announced there's just a completely different political tone about this. people stepping back at this $10 above the original deal. they are at $38 versus $28 comcast may come back with a higher offer do you get to appoint when you see this kind of competition for
these assets where the deal just doesn't really make sense over the long-term? >> i do think so obviously there's a number that doesn't make any sense and one thing that's different about this deal for disney is they have an excellent track record of acquisitions starting with the pixar deals those were intellectual property deal where is they got the right s to a lot of great material they have done a fantastic job of exploding this. this is not about intellectual property these are big businesses this is a different kettle of fish you have to value them differently and the potential for disney to put big multiples on the income stream here is much more constrained than when you look at purely intellectual
property >> when you look at comcast, even if they have a willingness and desire to potentially divest those, do you think they have a tougher road you referenced it earlier when it comes to get. ing these approvals? >> i feel it's going to be tougher. there's a time factor and maybe the most important thing here is if murdoch and the fox board really want to do the deal with diz et knee for reasons that we may not know, they have a hook to hang that on. we have approval in hand with this one and who knows what's going to lie down the road for all we know they will try another at&t blocking move, even though they lost that case, which could tie this thing up for another two years. so they have an excuse even if what they really want to do is the disney deal, they have a neutral thing to hang that decision on.
>> as far as the backdrop in the silicon valley players lurking, i don't know if it you saw the report from the information on apple that it's considering bundling news, music, content and magazines just curious who you think are the biggest threats to the traditional media players and what a move like apple could do >> i have heard a lot of talk about interest in the media space. traditionally google was up front saying we're not going to cross that line. we're not a content generator. i think everybody now is beginning to see when it comes to technology, there's lines that don't exist how do you divide the line
so given what netflix has done, we're going to see more big tech movement into news, media and other forms of content absolutely >> are we going to see those players actually try to make a bid for any of the more old school traditional content players. their mo has been we can build this from the ground up. i don't think they would be interested in fox assets >> they have been capable of building their own in a pretty quick way. >> it's remarkable i don't think they could step in and pull this off. it's really been a remarkable feat that they have done this successfully >> as always thank you so much
>> sure. good to chat with you. >> jim stewart >> as we go to break, a great cause to tell you about. we are auctioning off a chance to come down to watch the show live you and three guest will be here in the middle of all the action and get to meet david and sara and me this supports creativity as a tool to empower children to bid go to charitybuzz.com and look for "squawk on the street." there's one day left to bid. dow is down 51 s&p still holding on below 2700. back in a minute
let's get to rick santelli for the santelli exchange. >> good morning, everybody we have so many things to talk about. the first thing to discuss is is when it comes to china and europe and trade deals, we can get into the nitty-gritty of what's going on. but if you take a step back, the battle is almost over in my mind because the slow growth in europe and the issues in china, what they are doing to their currency, things like soy beans, there's no contest here >> i agree with you. i think you have to remember what does trump want i'd prefer no trade barriers that's his goal. he's using tariffs as a tool to get there. what are we find iing? the rest of the world is slowing down the stock market is under tremendous pressure. they are under the gun to come
to a deal. i think he knows it and they know it too. and that's ultimately why i think the markets are wobbling a little bit are not really on fire because in the end they might wind up with a better deal >> here's what i hear. the conventional line. everything from the tail wind perspective for tax reform is now being take b away by trade issues even if that's true, under logic that would dictate when the battle is over, stock market is going to get a big tail wind >> it would but what we're doing is missing >> you mentioned it a second ago. look at europe it's slowing down a lot. s&p 500 companies 40% of sales are outside the u.s. and it's slowing big time right now that is number one issue that is really bothering the market.
who are we going to sell this 40% to and i think we mix it up with the trade issue because this is 2018 everything is about trump. and that becomes a problem because we then missed the real stories out there right now. i think the real story is to slow down in the rest of the world. >> let's go to the next level. what's going on with the ecb, bank of japan. there was a comment made overnight by a bank of japan official that monetary policy can continue to work its magic like there's no limit to what we can accomplish with monetary policy seriously? is this like a new rendition of one flew over the monetary cue cue next >> look at the last ten years. what have you accomplished with this policy. you're talking about continuing it forward they are slowing down. they are not going for it. the bank of japan has come out and admitted we don't know why inflation is not going up it should be much higher than it is right now
they are out of ideas and they have to continue to push >> they are doing things at a hyper speed that could have major serious koconsequences >> definition of insanity doing the same thing over and over again. >> wouldn't that be. refreshing >> that's not what they do >> it doesn't happen those investors and those positions some day will go to countries that fair better we're standing in one. thank you. back to you. >> thank you very much shifting gears, canopy growth, the largest cannabis company in the world and the first to list on the new york stock exchange fourth quarter numbers yesterday and joining us to discuss the business is the founder and chairman bruce lintton
costs climbed. what drove that? >> we're in the warm up. canada has 300,000 medical patients we're going to add 35 million people in canada and half of them are old age and so i could have run off and been profitable in the warm up, but investors do better if i think about the game and i win the inning and the series. and so what we did is build a capability to on board everybody in khcanada who could legally by this both in what we can produce, package and sell it so i suspect the margin on earnings on 15 times more customers and revenue will be rewarded for taking the hit now. and my interest is being dominant, not profitable in the warm up. >> how are you estimating the sales on a market that doesn't exist yet? >> in canada you can't run a tv station or radio if you don't cover the cannabis file five times a day. there's no one not aware of
what's going on. the line up will be televised continuously so what's happening is the market will happen we're going to have a first set of products that are tightly regulated. by next july we're going to have new product, which is why a partner makes sense because i expect to be able to make beverages. and i find that people would like to have a beverage that makes them more positive, uplifted and has a feeling of having a beer or glass of wine and the kicker is how would you like to have zero calories so the opportunity to transform the ingredient the margins are better and what turns into a boring place is the world's model that's why we're not in the u.s. >> you think berges become a preferred delivery over vaping or edibles or topicals >> we're going to do all of them and let people decide. the reason we learned to make pottery is to make the wine.
so it goes back a long time. we have been thinking about beverages as a way to mood modify and socialize i don't think it's a bigsocial jump to move to that for sure more normal than gummy bears. >> would you take the over or under on federal looelization? >> depends on the depends on tr i think you'll see something that's more like state by state and they say because it's happening in that state we'll make it not illegal. it doesn't matter who is at the top in government. if they make it legal, i'm going to go somewhere that's flat, a bit of water and plant 150 acres of cannabis and my cost per gram will be 10% of anything that's being produced right now. >> why are you that much cheaper? >> if you go on scale. state-by-state and they can't cross state lines they have these small facilities my footprint that's most efficient is 1.5 million square
feet so what you'll find is the scale and platform on a state-by-state basis is very small. >> is over supply in states out west a cautionary tale >> you will have oversupply, but it's a much more regulated entry plant. what you'll find is in canada by 2020 or 2021, there will be too much cannabis produced if i'm still selling primarily an ingredient i have completely dropped the ball you want to transform that into medical trials for primary insomnia when they're done, if correct, will be a direct disrupter to ambien. did you buy cannabis or an outcome then you have to transform that ingredient, that's the business
we're in right now we grow because it's regulatory required. >> you're describing a lot of cases from medical to beverage. >> right. >> who is your subscriber? >> people who are, i'll call it, middle aged and up and have a chronic something going on, neuropathic pain or, call trkita condition related to diabetes. 90% of our current customers are medical. the reason i say that in canada, we have two primary chains of pharmaciy y iy ies who have spet of time saying we will never sell cannabis. now they're saying they have to because i'm taking their customer so they want in the game the rest of the world -- germany is on now with the same system for medical. my sleep aid works in canada i bet the german people will fall asleep using the same outcome that i've patented and proven if we get through that trial. >> i know you're already
exporting. >> yes. >> bruce, thanks for joining us. bruce lipton, canopy growth. let's send it over to jon fortt with what's coming up on "squawk alley. >> amazon buying pill pack is causing waves. but what is amazon actually buying technology wise when it's buying pill pack we'll dig in with people who really know these coans,mpie coming up on "squawk alley." so, my portfolio did pretty well last year. that's great. but the market was up nearly twice as much. that's a tough pill to swallow. exactly. so i started trading. but with everything out there, how do you know what to buy? well, i think my friend victor has just the thing for you. check this out, td ameritrade makes it easier to find the investments that might be right for you. like our etf comparison tool
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the dow is up .1 even financials today are catching a bit after a long-record losing streak in the market health care, though is the worst performing sector. pharma stocks, distributors, that amazon isgetting into the space, buying pill pack. industrials are down again, david. trade is the big theme in some of the uncertainty around the tensions and what the trump administration is going to do.
i'll be on "closing bell" today. nike is reporting earnings after the close. what analysts are expecting there. will america return to growth? and the fed releasing results from its stress test, part two what will they do with buy backs and dividends, especially wells fargo? w wilford will be on that as well. >> see you, sara markets holding in dow up 19. s&p holding 2700 later on we'll talk to the former director of sypheus
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