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tv   Closing Bell  CNBC  March 1, 2019 3:00pm-5:00pm EST

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getting the ability to control the company. i think it's so funny. reminds me of 1999 when they said what apparently is in the lyft prospective of we have not made money and may never make money. >> it is a unicorn. >> oh yes. >> thank you for watching. >> have a great weekend, everybody. the "closing bell" starts right now. ♪ good afternoon and a welcome warm to "closing bell. i'm wilfred frost. >> i'm contessa brewer in for sara eisen shares of tesla tanking after elon musk says he doesn't expect the company to turn a profit in the first quarter. plus amc on pace for the best day since going public in 2013 the company's ceo will join us for an exclusive interview that also is coming up. first of all, market action. we have 59:30 left of trade.
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session highs was 220 for the dow. anyway, we're up 0.6% and the s&p quite close to its session high an that gives us a nice gains for the week, as well. on the s&p and the nasdaq. >> yeah. in fact, the s&p having its best start to the year since 1991 we want do get to bob pisani for more on this. >> we are up 12% for the year. best start in a long, long time and obvious investors are betting on cyclicals and maybe a little bit on global growth. take a look at the winners so far in 2019 an it's banks, semiconductors, industrials and energy all outperforming three of the four are global players, semiconductors and industrials and energy and not just a play on cyclicals but global, as well. when's lagging defensive names. going after companies that have the greatest growth potential
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although parts of health care do have growth potential and there's the laggards for you trying to get over 2800 in the s&p. but take a look at the last couple of months here. january up 7.9%. february up 3% these are much better than typical performances in january and february march is also usually an up month and nothing like these kinds of numbers finally, how far are we from historic highs thank you for asking a three points that's a surprise. russell 2000 lagging a bit so far this year. back to you. >> bob, i actually would have asked you that question but the last couple of weeks we have seen a plateau in the gains versus the fast pace of gains of earlier in the year. has that seen rotation in the sectors, as well >> there were moments in the last three weeks where value temporarily outperformed growth stocks and we had some names in
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like utilities briefly outperform and none of that lasted very long i think the problem right now is the market's expensive wilf, if you have 0% earnings growth you're over 17 times forward earnings for 2019, that's an awful lot to pay with fairly flattish earnings growth and fairly flattish global economic growth so we have a little problem we have to get the earnings up, better economic outlook globally. >> thank you for that. see you again. should investors stick with what's working this year or go on the hunt for value? joining us is mark lehman and tony shara very good afternoon to you both. mark, in terms of what has led the charge, what do you put the main winners down as will they continue to win? >> well, we've seen a big rebound in tech stocks since the tough days in mid to late december and we have seen earnings growth there, too i would expect it to continue through 2019
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the question mark all along is what are investors willing to pay for that rates are low and so investors are willing to pay more for the great tech companies they humid an opportunity to buy them briefly in the fourth quarter and paying new heights for them today and how much are they willing to pay for them i think the numbers come through in 2019. >> all right tony, what is your take? do you think that tech still offers a valuable return on investment >> yeah. great conversation something that's worth thinking about right now. to go along with what mark just said, lower rates, this idea to go back to a lower for longer environment and kind of a powell put being back has caused tech stocks and information technology stocks as some of the blood and guts, industrials, to rally pretty hard this year. no, we don't think that will last biggest problem is valuation the disparity of the really rich an kind of poor in terms of the forward valuation is at the greatest heights that it's been
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since 1999 and in our view when the market gets back towards sorting that out, what's the next leaders in the next decade woe do not think it a tes leaders of what were in the past decade at all we think there's room on the lower side of the valuation range to be upwardly revalued on the market there's a lot of very cheap stocks out there right now. >> so, tony, decade ahead aside, but year ahead in focus, we've seen the banks do well the start of the year and one level is kind of odd since the fed has signaled it's going to hike rates less what do you expect from the fed and what does it mean for the financials the rest of the year? >> we expect powell listen vindicated by raising rates like he's done, for him to pause right now is warranted but we think he gets back on track to raise rates some point in time driven by the economy expanding in a greater way than what the consensus believes we think the demographics suggests that's well in place for that to happen
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there's not yet been the animal spirits that have kicked in, for example, in the generation of millennials and what they're going to do in the next 12 to 14 years as they do household formation activities, normal for them to do and to take on statistically four times of debt than they currently have today and they have ample room to do it the balance sheets are clean that's the thing we haven't seen yet from the banks and the tailwinds we think will be there for the banks going forward. >> hmm mark, what do you think? are you feeling some eagerness over ipos this year? >> well, you know, we saw the filing today for lyft and i think that's a precursor for a big '19. you will see as i like to say my kids are starting to hear the names of the companies to take public and this is going to be some consumer names like lyft and others that go through 2019. watch the valuations of those companies and watch what happens in the aftermarket we had several of those last year, docusign went public last
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year and i think still has better days ahead and i think ipo market is a window of the future and this year's going to be a great example of that, seeing lots and lots of consumer -- >> what do you mean by that? the window on the future. >> because you look at sol of these company that is went public in the past and they're changing the way we fundamentally do -- live our lives. docusign is changing the way we do large, big, bulky transactions look at lyft it is not a stock that everybody's heard of the stock but you look at the fundamentally the way we're changing transportation and see what happens with autonomous if you bet on lyft you bet on the future of domestic transportation and a window on the future and the ipo market has been a window on the future and look at the last decade and the same story in 2019. >> tony, in terms of individual stocks you like for the year ahead, you have kroger on the list are you concerned about the
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amazon threat of building more stores >> great question. that is what is -- that's what brings the opportunity to something like kroger or to something like walgreens it has caused the valuation on the high quality, really great companies to be extremely discounted that's an example of the thing i was talking about that we think needs to be revalued aver the next 12 to 24 months andample room for pe expansion in those stories. >> and your other one on the list is amgen. >> health care's been one of the biggest laggards of sector performance year to date that's a former glam stock over most of its life of being public right now trading at a 13 times forward multiple for a very high quality business that has a lot in the way of its pipeline they're doing a lot of good things and getting a lot of traction with their migraine drug we think it's a bigger drug than
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the market expects right now but a relatively low growth top line and why it's discounted. it's a 3% dividend yield while you wait and higher than the 10-year treasury we think it offers tremendous value an it's very highly weighted in the portfolio right now. >> mark, before we go, quickly your top single stock pick for the year ahead >> i'm a big fan of docusign i continue to look at the software names of salesforce reporting monday as a small example of what i said earlier, salesforce is two thirds of the market gap of oracle and larger than sap you get a window on some of the great companies, you want to own them valuation disruptions over time and own the best companies to be profited if you own them for the long term. >> gentlemen, thank you for joining us mark and tony. still to come here on "closing bell," the shanghai comp just turned in its best week since 2015 and a new move
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by one indexing giant could drive billions of dollars of foreign investment into china. we'll explain that story ahead. tesla's hitting the brakes as elon musk surprised tesla announcement failed to excite investments and we'll hear from carson block next. we see a billion more people breathing free. we see access to fresh food being the global norm, not the exception. we see homes staying cooler, without the planet getting warmer. at emerson, when issues become inspiration, focusing core strengths to create a better world isn't just a result, it's a responsibility. emerson. consider it solved. this is decision tech. it's screening technology that helps you find a stock based on what's trending or an investing goal.
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♪ welcome back we are up on the dow s&p up 0.6%. nasdaq and russell the best part of 1% each for the week as a whole we are flat on the dow and the russell just higher on the s&p. the nasdaq up about 1% for the week. shares of tesla plunged today after the surprise announcement last night failed to incite investors. phil lebeau has the statement. >> the model 3 the company plans to start deliveries of in two to four weeks i read through the notes that started late last night through this morning they came to the same conclusion the margins will suffer from this move. it is going to be tough for them to break even at $35,000 if
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that's what the vehicles ultimately end up selling at and raises the question, is demand slowing down taking look at deliveries, keep in mind that elon musk told reporters last night they expect production in 2019 of between 420,000 and 600,000. actually, more bullish than their previous guidance at the end of the fourth quarter. so now the question also becomes, where are they going to be cutting costs because they're cutting costs. part of it is going to come from the fact of closing down most of their stores and galleries, that will happen eventually how quickly it happens depends on how quickly to get out of the agreement that is they're in and they will eventually rather quickly be moving over to online sales only so three questions are really dominating shares today s. there a cash crunch? they ended last year with about $3.7 billion in cash and assets on hand, $920 million convertible note that payment is
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due today. we have not seen word that they have made that payment and then there's the question of what's going to happen between elon musk and the s.e.c. he has until march 11th to respond saying he should be in contempt of court. a day where the shares did not, did not move higher after that announcement last night. noticeable downside after that announcement. >> phil, just quickly in the short term, that $920 million payment, would they typically announce once they made it or not? >> typically, no they usually just file it with the s.e.c. we could see a filling coming late tonight >> okay. so that likely to have been paid let's continue the discussion, phil, stick with us, bringing in carson block he's a short seller on tesla thanks very much for joining us, carson good to see you. >> yeah. thanks for having me. >> so just remind us of your bear case on the company, the big picture reason why you're
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short the stock. >> well, so, we're short via some long dated puts it is not a major position for us but our view the company's likely to go bankrupt. can't tell you exactly when. but that's pretty much the -- our bear thesis on it. >> so when you see they have lowered the price of what is likely to be their most voluminous vehicle in the future to 35,000 is that something that concerns you given that it might use up more cash building it than it makes profit-wise given the cut in price >> yeah. i mean, it doesn't seem there's a way for them to be profitable on selling the car at $35,000. and there are also signs that demand is not there anymore for the higher priced model 3s model ss model xs kind of doubt that even for this drip down version of the model 3 it's there so i think for at least -- look.
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from my perspective, one of the good things about last night's announcement was the company probably only had a rake d violation instead of usual 10v5 lying about something issue. >> phil, jump in. >> carson, i have a quick question for you you do not believe that there is enough demand there, that demand is slowing up. what is that based on, a gut feeling? based on the fact they're lowering the price on this vehicle as well as the model s and x or other data, anything to point to to say, no doubt they're slowing down in terms of demand >> so, lowering the prices, especially to points where it seems like they're losing money on some of the cars i would say is a giveaway. also, the delivery times if you go on the websites, anticipated delivery times for the cars now are pretty short so seems like they're probably not building new cars to satisfy that demand but rather pulling
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cars out of existing inventory stockpiles and those stockpiles are pretty well chronicles on the internet with lots of photos of parking lots, brimming with teslas so that's why we also think that there's a demand issue here >> you know, if you say you think that that company's going to be bankrupt, you're not just talking about problems of profit expectations in the first quarter. you're talking about long-term outlook. how much of this has to do with the companies balance sheet, things like a $920 million bond payment coming due >> yeah. i mean, look the company has debt the company strings out the payables to its suppliers. so from a -- and just at the end of the day,just don't think that the company's ever going to achieve the kind of scale necessary to be able to compete with the competition coming online in electric vehicles and just not able to generate the
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cash that it's going to need to repay the debt so that's, you know, that's basically the issue. you know where i was coming from this morning in the "forbes" op-ed i wrote was i was really also focused on elon musk's war with the truth or war with short sellers and suggesting that he relist the company in an environment that's much more favorable to companies that don't want to tell the truth and that is germany. which has now amassed apretty good record of persecuting or prosecuting corporate critics. >> well, the op-ed, carson, an interesting read, but i think we'd open of debits going deeply into it. the point as it relates to tesla is whether or not you expect the s.e.c. to take further serious action on musk or whether he's
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likely to be able to stay in his position and with it, therefore, keep the support of many shareholders that see him as crucial to the stock price. >> yeah. i think tesla's really interesting thinking about what's going on globally there's a global war against truth. and there are millions of people presumably who think that we should apply a double standard to elon musk because he's at least claiming to save the planet and that we should not hold him accountable for his mistruths. but at least we see that the s.e.c. is holding him partially accountable anyway if you talk to people who are in my camp, the tesla bears, we can come up with a long list of item that is the s.e.c. should have also looked at prosecuting him for but they ultimately threatened to -- they filed a complaint against him over the
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funding secured $420 take private charade and then when he violated the settlement they're attempting to hold him in contempt of court so at least in this country we are still holding an icon like elon musk accountable for attempted lying. >> i don't know about that, carson a lot of journalists, analysts pour over the numbers regularly. if you had hard proof he told lies in general was lying then i'm sure the stock would be at zero. >> i'm - >> i think that is unfounded the level -- i'd just add, as well, carson, you said yourself you have a small long-term short position and if your conviction was higher then i'm sure you position would be higher we will have to leave it there sorry. quick final word go for it. >> yeah. it has nothing -- look the fact that i know he's lying and he's been demonstrated to lie doesn't mean that it's a
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great short. do i think the stock goes down no as i often said this company could file for bankruptcy the day that it has a $30 billion market cap what investors choose to do with the stock is independent of whether he's lying or telling the truth and he has a well-documented track record of lying so that i'll take, you know, i'll bet on that side any day. >> okay. we'll leave it there carson, thank you for joining us phil, also, thank you very much. coming up, despite a year to date rally apple is still down more than 20% from the october highs and heading to the annual meeting to see what shareholders are saying and asking. three weeks away from the next fed rate decision wall street executives are weighing in with their peatnsexctio we're back in a couple risks
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the new month brings a new interest rate decision from the fed and wall street executives are weighing what they expect ahead of the march meeting frank holland has the results of cnbc's latest cfo survey hey, frank. >> yes the results are in and global cfos mixed on how they see the fed and interest rates in 2019 the next decision will be announced march 20th this survey wrapped up february 22nd and they're looking ahead and almost 30% say they don't
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see any rate cuts or hikes in 2019 and one with a hike for the year and 17% with 2 hikes and no cfo saw three hikes or cuts in 2019 we had three hikes in 2018 at the same time, looking back at q4, no cfo saw inflation as a risk in q4 now 3.7% say they're pretty concerned. coming to tax reform only 35% of them believe that the 2017 tax cuts and jobs act continues to have a positive impact on u.s. companies this year. 65% say those tax cuts will not give their company any additional boost but they say tax reform just sets a new baseline more mixed results with bond rates. today the 10-year bond yield at about 2.76%. at the end of the year, more than 35% see that rate below 3%. almost 35% see the rate above 3 and below 3.25% and almost 25% see that rate between 3.25 and
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3.5% also today, we are seeing the dow just over 36,000 up this week overall again, mixed results coming to where cfos see the dow% see it s before any new highs, not fallen to that level since christmas eve. 33% think the next move is actually up to a new record high of over 27,000 back over to you. >> all right optimism there. >> absolutely. >> frank, thanks. >> thank you. tesla may be down today but the other company will go sky high beyond the high. details on the critical mission set to blast off in a few hours. up next, we'll take a look at the state of the american consumer stay with us bring financial stress to work. if you're stressed out financially at home,
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♪ welcome back to the "closing bell." there's the sector heat map for you. energy and health care leading consumer staples at the bottom with real estate we are up around about half a percent for the dow. nasdaq leads the charge up. let's gate cnbc news update now with sue herera. >> hello, everyone here's what's happening at this
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hour the trump administration stepping up pressure on the government of venezuelan president maduro slapping sanctions on officials this for obstructing the delivery of humanitarian aid into that country. >> dictatorships come to an end. some last for a very long time others a much shorter time this one in venezuela will also come to an end we hope that it comes to an end quickly and peacefully. pakistan handing over an indian pilot captured after his plane was shot down by the pakistani military this week over kashmir india officials greeted the pilot accompanied by a representative of the international red cross. maine lobstermen brought in more than 119 million lobsters ashore last year that propelled the total value of maine's say food to the second highest value on record and catch was $485
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million. boosting the total value of all maine seafood to $637 million. no word on how much drawn butter or lemon was but it makes you hungry. right? >> and buns, right lobster roll. >> there were tariffs and looking forward to opening china as a big market fur lobster. >> that's right. >> in spite of that, a booming, booming season. >> delicious. >> i know. absolutely. >> sue, not quite time for dinner see you next hour. >> you got it. >> it's on the mind now. thank you very much. u.s. personal income fell for the first time in more than three years in january steve liesman has the data for us. >> history shows when americans have more money in the pockets, they spend it. but a report today issued this morning which had been delayed by did government shutdown showed incomes in december surged 1%, good news right in the heart of the holiday shopping season. wages up strong. that should have sent americans to the mall with some abandon.
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but they didn't go spending fell .5 a point the worst december decline since the decline. the savings rate shot up did americans suddenly turn fry inaugural? that's unlikely. one offs boosted by farm subsidies and a one-time special dividend paid by vm ware and skepticism some economists think the data was messed unand will be revised higher or the spending shows up in january so it's been a good rule of thumb. when americans have more money in the pocket, they spend more december was probably an exception to the rule, not a repeal. >> steve, thank you very much for that steve liesman back at hq for us. and joining our "closing bell" exchange today, ben laler
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and rick santelli who's at the cme. there's a fairly optimistic viewpoint coming from hbsc about where we are heading through 2019 lay it out for me. >> right i think we have seen a sort of pain trade for many people so far. the market rallied people not participating i think that's continued i think we're probably more than halfway done but i think sentiment's still too cautious earnings next multiple expanded here and how you made most of the money and the earnings is the next thing to move up and i think probably gives us the next end of this rally and we have about 10% to go for the s&p 500. >> you're thinking double digit eps outlook? >> yes 10% for full year and consensus is half that right now. >> on the point of the data that steve went through today's data and the gdp yesterday, what's your take at hsbc of where we end the year for 2019? >> we're full-year gdp growth of 2.5% obviously not as good as last
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year but an above trend growth number and, you know, 6%, 7% revenue growth and we think margins are stable and, you know, that sets you up for meaningfully more than the market is expecting in terms of earnings this year. >> rick, talk us through the yield outlook over the last couple of days because steady climbing from the likes of the 10-year. >> yeah. no absolutely it's actually even a little bit longer than the couple of days i would say the last eight sessions the long end is just had a little bit more horsepower, little bit more kinetic energy monitoring the spread relationships of the longest maturities is always a good sign, sometimes you can really pick up trend changes, especially considering we're in this pause period on the short end of the market with respect to the fed and that might be very short lived but the widening of that spread out to now about 40 basis points, historically is a good measure to monitor of rates of areas to
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reverse. today 312 in the 30-year old, best close since mid-december. we were up more than ten basis points briefly when they were hovering at 2.76 it's not just the u.s. boons, everything, more than doubled from the last low from 08 basis points. and even though that's low i think it's all significant the other area that's giving validation to that notion is that the dollar index, a power day today and we have talked many times it seems to melt around 97. we get that. but it was melting a bit under 96 today not only did it have a big up day but it also recouped all the losses for the entire week >> ben, has the fed's pivot already been fully priced into u.s. equities? >> i think so. if they go higher, the catalyst comes from somewhere else and the pifvot was very important ad
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got us most of the rally we have had so far and i think the heavy lifting is done by earnings and estimates cut too much and now beginning to see them begin to move up. >> you're overweight em. is that relating to dollar outlook, as well >> not really. we think that em can do well despite that it's the most unloved asset class globally very cheap you know china which is obviously the biggest market in em is pretty much most hated asset in the world and we think that's a recipe for performance chinese gdp will be fine you know the indices, forcing you to put more money in there. and we think the china rally continues and drag the rest of the em with it. >> rick, your view where we stand at the end of the week softness or flatness really more than anything over the course of the week >> yeah. i think the complexion of the curve is tricky, entire curve,
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especially with the fed. you know, there's a lot of discussion out there i don't know when a pause became, you know, written in permanent marker i think that's a fatal mistake if investors are thinking that at one point maybe it was 50/50 a. ease or a tightening was the next move but on complexion of the curve, i would say the meeting is probably the june or july meeting to pay attention to with respect to the market of time to simmer, get through this earnings season and the humps with regard to how the market responded and acted in october and november and year end because combined with the partial shutdown of the government we're just starting to get a complete picture. we always know that the first quarter with respect to gdp is flawed due to seasonalities and i think ben is right, the surge comes further down the calendar that will substantiate the rally
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we are seeing today and the stronger interest rates. >> rick, thank you ben, thank you for being here today. shares of amc surging on heels of strong fourth quarter results. we'll talk with the ceo coming up. spacex gearing up for a crucial test tomorrow. morgan is live at the kennedy space center morgan >> hey, guys we are entering a new era of human space flight spacex is one of the companies poised to usher it in. key part of the process going to happen righthe o tren that launch pad we'll broadway you details after this break blank blan
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♪ spacex is gearing up for a critical launch tomorrow morning. cnbc's morgan brennan has more from the kennedy space center. morgan >> reporter: early tomorrow morning, wilf. early. so this test launch, it could mark a major milestone for spacex and for america overall
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if all goes according to plan, this will be the first time a commercially built spacecraft designed to carry humans is launched into orbit and visiting the international space station. now, since the space shuttle program ended back in 2011, the u.s. has not actually had the capability to send humans from u.s. soil into space, into orbit. instead we have been paying launch sums of money to russia to do it for us. nasa awarded two contracts several years ago under the commercial crew program to address this one for $2.6 billion to spacex to develop its crew dragon which is the capsule atop the rocket behind me. the other one to boeing for the cst starliner for $4.2 billion the way it works, they will own and operate the spacecraft and nasa will eventual lease them out for its missions now, spacex, this test tonight not going to have any humans on
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board. it is unmanned but spacex is the first of these two companies to get this far in the testing process so it's being watched very carefully if things go well tonight and in the months ahead you could see the company carrying astronauts to the space station as soon as july but first, we got to get through tonight. blast off right now is scheduled for 2:49 a.m. eastern this morning from this launch pad behind me. falcon 9 rocket with a capsule on top and even though there's no people on board, there's a payload, 400 pounds of cargo and a passenger, a mannequin that is clad in a space suit spacex designed space suit with sensors to test the flight and the g forces of that flight. that is actually named perhaps unsurprisingly by spacex, her name is ripley in honor of that
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classic 1979 movie known as "alien." guys, back over to you. >> fascinating stuff but here's the real question how close does that get spacex to a human in space before boeing >> reporter: that is the key question right now so there's several key tests for both of these companies. this is one of the last ones for spacex and it's the last one to orbit for spacex before it starts sending astronauts. if this goes well and the next safety milestones they have to hit go well they could be sending humans as soon as july boeing is scheduled to do the next uncrewed test next month and could be sending astronauts as soon as august but this is very much neck and neck. it is seen for several years now as a rivalry and, guys, i would also just note because these companies are going to own these spacecraft they lease them out
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for use by nasa by sky's the limit in how else to put them to work maybe for other countries, maybe for space tourism. it's all possible. >> sky's not the limit, as it were >> reporter: not the limit that's true. >> where are bezos and branson in this race >> reporter: they have been designing different types of vehicles the vehicles from boeing and spacex are orbital vehicles. they go to low earth orbit where the space station is located virgin galactic's vehicle and that blue origin, by the way, the rocket factory right down the road from here, sub orbital meaning they take paying passengers to the edge of space and back down. i will note, though, blue origin is developing an orbital rocket but it's a few years out. >> great stuff. >> reporter: lots of technical terms. >> lots of -- very fascinating technical terms, though. we look forward to the coverage
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come monday morning and cnbc.come over the weekend. we have 13 minutes left of trade. the dow's up by 0.6. will we get a 1% gain? we'll see. 40 minutes left. the msci is giving chinese stocks a bigger role the company's ceo is here to weigh in and tell us what does it mean for foreign investment that's next on "closing bell." [leaf blower]
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asian markets are closing higher today on the back of the announcement of quadruple the weighting of chinese mainland shares in its global benchmark indices. the move is expected to happen later this year and could bring in more than $80 billion of foreign inflows into china's economy. joining us no discuss it more is henry fernandez. it's great to see you today. talk to me a little bit about why you're making the move and explain what it means. >> well, the china asia market, the domestic market of china, on shore, is opening up
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there are a lot of liberalization, restriction relaxation about a year and a half ago we put in 5% of the value of the large caps that went into the index in 2018. and what we announced yesterday was an increase in the value of the large caps and also including the mid caps going into the index in three steps in the balance of the year. >> henry, the weighting in the overall msci emerging market index gone up four or five fold in the index >> yes the asia part, remember, there's already a lot of chinese shares in the index but these are shares that trade outside of china but the shares from 70 bases points to 2.8. >> yeah. >> percent in addition to that. we are also including middle caps into the index that once done it gets to about 3.3% by the time towards the end of the year. >> what do you understand is why
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now when the decision is such a big decision, going up five fold why wasn't this drip feed done over the last couple of years so that you didn't get to a point where you have five times out of whack of where you needed to be? >> what happened was in the first step there was a lot of lack of understanding of investors and investing in china and there was a little bit of concern that the step could be too large for them to learn and understand how we were to do that once the step was done and got experience it was very comfortable with the market and therefore able to accelerate the pace of inclusion. >> now there are investment managers who are curious does this mean in another year to see it go to 80% or 50% you have said anything beyond 20% requires chinese authorities to address remaining market accessibility questions.
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is there any confidence on your end, is there an indication a deal with china with the united states might be the opening that you need to do that? >> well, the step, the pace of which we make all these steps will depend on the opening up of the market right now we feel that where we are is reflective of the pace of opening up by the regulators to the extent that the regulators in china open up faster and sooner, obviously, we will be a step by step with them in further increases we also believe that that process of opening up the capital markets of china has been relatively independent of the china/usa trade relationships or trade discussions. >> you don't think there's a correlation? >> there is a correlation. that so far independent. but i believe that it could accelerate it because, you know, china's looking for the sophisticated capital markets, the integration of the financial markets into the global economy
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and, therefore, the negotiations of the trade agreement also serve as a counterweight if we cannot get a lot done in the trade agreement to take sometime, obviously, with tus and other countries and another way to accelerate the opening up of china is through the financial markets. >> henry, there was a ltd. of speak la speculation to be increased. do you think it did so in expectation of making the decision or more upside to come based simply on the announcement you made today >> i think the rally in the market has been more because the market was oversold to begin with in china. secondly, obviously, the progress on the trade negotiations with the u.s. and there was a little bit of expectation that we were going to increase. but i don't think that was the major determinant but for the first two points there's additive to what was happening but i think also people learned to understand that the market is
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opening up there's a lot of foreign investment going into the market and, therefore, that msci is side by side with the process of opening up. >> thank you for joining us. >> thank you. up next, the closing countdown. we have five minutes left of trade. after the bell, shares of apple up 10% so far this year. we will have highlights from the company's annual shareholder meeting later on "closing bell."
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welcome back to the "closing bell." a nice little session to round off what had been a lackluster week for most of the last few days s&p as you can see up 0.7% nasdaq and russell up more dow up a little less than that sector performance relatively encouraging. health care, energy toward the stop real estate, defensive sectors towards the bottom 10-year as we mentioned earlier, ticking up quite noticeably during the course of the week. has been a steepening of the curve. which is also encouraging. oil prices for the week, they're down 2.5% here at the end of the week about the same for the week as a whole. something to keep an eye on. it's been a bit more volatile this year. bringing in bob pisani and the
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s&p showing you it's been lackluster most of the week and a pickup today into the green for the week, as a whole. >> we're waiting to see ten straight weeks on the upside on the dow. it could go either way overall the trend is still intact generally cyclical names like industrials have done well semiconductors have done well, energy and generally energy staples and defensive names like utilities have lagged a little bit. not so strong this week but overall trend is still intact and the fact to end over 2800 on the s&p, that would be the highest level in several months, early part of november in terms of highs so breaking and closing over 2800 would be a positive technical signal. >> four days in a row. the first day of decent gains. flat week in general. >> yes remember we were up 7.9% in
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january. 3% in february march generally is an up month, as well. i can't imagine we don't end the first quarter in positive territory. >> thank you very much ringing the bell at the big board is noisy group i can't read who it is girls take wall street congratulations to them. tory burch at the nasdaq that does it for the first hour of "closing bell." contessa, back to you. ♪ and welcome to "closing bell." as girls take wall street, i 'm contessa brewer. wilfred frost rejoins me in a minute with mike santoli, senior markets commentator. and here is how we are finishing the day on wall street as you can see the dow industrials up almost half a percent. s&p up, nasdaq composite up .8% and the russell 2000 also up .9%
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on the day coming up, the lackluster hollywood box office this year and joining us to talk about the market day, rob cox from reuters. good to see you. but first, let's get right to mike santoli here are the markets are playing a little bit of a ballroom dance it's the chase come here, come here get away, get away. >> that's right. everyone said it's this point, logical point to pull back and didn't really pull back. it's halting moves lower sideways i don't think there's edge in terms of today's action telling you exactly where the next couple of percent are going, up or down. but it does seem as if it's a pretty comfortable environment in terms of the rally being on decent footing, credit markets
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seem okay. volatility bled out of the market so that even if you did get a pullback investors are ready and waiting. >> what do you think do you think it's more of a casino ride? casino i meant canoe ride i have casinos on the brain. sounds like one in here. >> it is not white water rafting by any stretch this week you had sort of a mixed signal from the bigger picture. china trade. there were some signals that that might be going in the right direction. it kind of headed back you got sort of a sense that the fed isn't going to be anything to stop the -- or to further crimp the flow of money. and then i think you've got this, you know, i mean, again, taking the big picture here, the failure of the talks between the u.s. or donald trump and kim jong-un probably puts the -- on balance puts more pressure on the united states and the u.s. administration to do something on the trade front with china. on balance that seems probably
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good for global trade. certainly good -- would be good for the chinese economy and any glimmer that is the chinese economy's not falling apart is certainly going to be good for markets. >> mike, we have talked about a sort of defensive tone over the last couple of trading days, last couple of weeks but actually looking at the weak performance, financials, tech and energy top the list. >> yes. >> where does that come from >> this week i think one reason is that treasury yields nudged higher so you had defensive sectors yield chase beneficiaries that maybe came off the boil a little bit. i think on balance the economic numbers had been fine. right? we got confirmation that december was a quirky, slow month for the consumer but once you had gdp coming through as better than expected in december suggested that the trend wasn't change so i think that doesn't account for it you have a miss today on the manufacturing ism, i think manufacturers are saying we're
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in the zone where the markets up a lot but back to early november and early november you thought the economy was okay but not blistering and now we know it's pretty much okay but not blistering. >> on yields, it is a steepening ocht curve opposed to tightening is it something we need to keep an eye on? yields over the last year is one of the factors that spooked markets. >> coming from these levels, absolutely still just 2.75 on the 10-year so i do think that at some point it will become an issue and with the corporate bond market staying tame and spreads tight, i don't think the stock market finds too much reason just yet to get worried. >> rob, in terms of the china trade deal srks that the wild card macro factor left unsolved bearing in mind we had the good news on the fed pivot, as well >> yeah. one of the things that came out
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today, there was some sense that manufacturing is down a bit in china but not as much as previously partly that's due to chinese government policies. you know fiscal stimulus. i was recently in china. it is just hanging over. this is sort of over everything is the u.s. and whether it's -- whether we see a deal. the idea that at this point i can't imagine that the president wants to have another failure in his sort of -- in the asian sphere of influence. it seems to me it's on balance likely to do something and less -- it doesn't matter -- maybe matters less to america in the first instance it matters more to the chinese economy but we all know whenever we see jitters of economies, chinese economy slowing down is bad news for everyone so i think it could be on balance -- i don't know i see no reason for people to be, you know, pessimistic based
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also on the other stuff you were talking about. macro economic front and there's not that much competition of treasuries. >> do you think that change, that changes if the fed starts talking a little bit tougher again about its balance sheet, about this free access to easy money and whether companies have really the credit worthiness to deserve it >> it definitely changes if the fed keeps out there this idea that they're poised to look for an opportunity to hike rates latter this year, yes. i think we are in a little bit of a safe zone now because they have shifted the tone so much that they wouldn't want to whipsaw the market radically and look we are a few weeks away from another fed meeting where they will give the consensus outlook so they're at least a potential for that. >> let's move on and talk about lyft filing for the highly anticipated ipo earlier today. the company revealed it lost $911 million on $2.2 billion in revenue last year and saw its bookings increase by 76% to $8.1
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billion as of the end of the last year and claimed 39% of the market mike, fascinating to get an insight on the numbers we have been waiting for this for a long time. i mean, my take is that the revenue growth while fast is slowing. we know that for sure. the loss it's making is widening and it's not an early stage company anymore. it's not a late stage company and six years old. and it's kind of already increased the amount of the revenue it takes it is percentage of total bookings it takes home, 18% two years ago. 27%. so in the short term you're thinking what other levers can it pull to change that widening loss into a profit >> absolutely. does the business, in fact, scale any time in the foreseeable future to a point where with those metrics, take rate in terms of how much revenue they claim for themselves they're profitable and the question uber behind it
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it's a duopoly. people compare it to netflix or amazon but they're winner take most business models, very virtual business models, right not heavy in terms of logistics and these companies, two sets of customers. the riders and they have the drivers and there's a balance there they have to strike over the long term. >> i think the other point, as well, i would make is the ultimate bull case is driverless cars taking out one of the biggest costs. drivers. >> 100%. >> that's not soon and i don't know why market share in the current model means they get market share when driverless cars comes you think if tesla gets the best driverless car, waymo, that they can -- >> licensed cars. >> exactly so it's -- >> the app's on the phone. they have the customer relationship they have the data who knows? >> rob, does lyft get anything by going first and beating uber
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to the punch on the ip 12340. >> yeah. that's a funny dynamic here. right? they're the number two by a relatively -- not a small margin so getting out there first matters. you know, the other thing is this is a great opportunity to start to see real pricing, you know, of these kinds of companies and companies getting -- gone through abc -- all the way down series fund raising and now we know seeing the numbers they're not real numbers because it's private offerings. you have weird who knows what kind of preferential shares sold it is great to see a market test for some of this stuff as you were pointing out, this is funny they doubled their revenue which is -- slower but still doubled and they only -- the losses by 30%. it's a weird concept of negative or positive operating leverage and losses i don't know when you get to the point where it becomes positive. maybe it's as you say when
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robotic cars are the ones picking us up. >> rob, we have got another dual class structure in this as the founders and managers to keep the voting rights. how long can that go on? do you think investors are still happy to give the money if they're comfortable with the valuation, still happy to give the money in that structure even after seeing some problems come out of wit the likes of facebook and so on and so forth where governance is called into question >> yeah. i think it's ridiculous. there's not a sunset clause. i was hoping whether there's a, doing this for five years and there's talk that even some of the new york stock exchange, the nasdaq, under pressure from investors to push back on this governance there have been some voluntary -- some companies have come out with the sunset provisions sadly lyft did not they have shares for the founders with 20 votes we saw what happened with snap
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zero, zero votes and at the time many of us argued that that was a bad idea and that investors should say no the stock has proven that to be true, not because of the governance necessarily but i think it's unfortunate they could have done something here, even a provision allowing that to win know away over five or seven years. >> mike, just quick one final point on this. we have seen other tech ipos file now this is the headline grabbing one. does that mark the top of the market or show that we're off on another long-term -- >> i think it would have to roll for a while before it looks frothy with a threat not on a supply demand basis for investor dollars even on the sentiment basis. they're big, mature companies whether you think they deserve the valuation they get it or not. it is not as if they're a concept and a dream. >> well, a story we first covered a few weeks, new york
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governor cuomo saying he is making a last-ditch effort to convince amazon ceo to reconsider the decision to pull out of new york. the company scrapped its hq2 plans last month after meeting resistance from new york lawmakers and there were some very vocal local protesters. and open letter to bezos ran in "the new york times" today with ceos of citi and others asking amazon to reconsider its decision there is no indication that amazon would do this mike, what do you think? is it something they should? can the pressure of other ceos come to bear if they were willing to take their ball because people weren't playing nice in new york city, can they make it anywhere else >> i think, first of all, it makes sense for the governor given that he was out front on the initial initiative.
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>> he's promising support but, you know - >> i think it's worth a shot and conspicuous thing, after the initial shock that amazon just pulled away was, i think it really does raise the question of exactly how committed amazon was, right it was a publicity stunt more than we thought. 25,000 jobs they promised. probably only a fraction of what they add in ten years company wide i don't know if it's that effective. can you get some commitment for some more jobs here? maybe. >> rob, in the long term, does it harm the ability of new york to attract new business? >> no. i think, you know, i have all along thought it was ridiculous for a city like new york dangling these things not because it's like -- i don't know because they're rich and they should have it but because the city should focus on the greatest transportation links, cleanest streets, the -- it can attract the absolute best talent
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and best companies and the best people. >> but cuomo pointed out, yeah, $27 billion in revenue for a couple billion dollars in incentives the math makes sense. >> yeah. but once you start handing it out to amazon, everyone will line up and ask for goodies. i don't think that's capitalism. focus on what you're good at, making this the gleaming city on the island, on the hill, whatever you want to call it, that everyone wants to be at and base their companies, every kid wants to go after they graduate from high school just this is what you want to do and focusing on that, make it the very -- world class city, museums, very best restaurants -- that's not their arena then you would have no problem. this is where i think you go astray and if you -- i don't know if you guys travel on the subway lately. i'm here this week from paris. it is extraordinary how bad our transportation system is get that fixed and everybody
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will come. >> i always think the subway gets a bad rap there it's pretty good back to amazon stock with a boost and the news of the more physical stores lower price point. >> yeah. i mean, i think it's -- amazon can do whatever it wishes. i think today showed that there was still a potency and also would say there's rotation in fang-like stocks today and not really a reaction to the grocery stores and nobody's convinced that whole foods improved the operating performance under amazon necessarily. >> rob, thank you very much for joining us. >> thank you. up next, apple is up nearly 10% so far this year but that's under performing the dow and the tech sector. we'll debate whether the dow's best days are behind it. amc entertainment ceo adam aron weighs in on the weak start to the box office this year.
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welcome back order sales number for february just coming in phil lebeau? >> not a huge surprise here. most expecting sales to drop last month and that's what happened, down 4% according to
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the research firm auto data. the sales rate, the rate of sales, 16.57 million vehicles. that is the lowest monthly sales rate since august of 2017. a little below what analysts were expecting i'm not sure people get terribly worked up about this number mainly because february is a low volume month now if march or april comes in as weak as february, then the automakers and the dealers get worried. >> all right phil, thank you for the quick update there. apple shareholders are looking for real answers from ceo tim cook about how it plans to jump start iphone sales josh lipton at apple's annual meeting in cupertino, california, with details tough questions. were there good answers? >> reporter: contessa, the shareholder meeting concluded. let's start there. the eight nominees are elected to the board, that would include apple's ceo tim cook and
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executive compensation was also approved, two shareholder proposals rejected as the board recommended. the stock up 10% year to date and down some 25% from the recent highs i did catch up with some shareholders, some apple investors and just asked them why they're confident that the stock will move higher from these levels take a listen. >> but i just think what they have planned in the health care sector and the 5g market will be enough to carry the company. >> i think apple is kind of meticulous and careful with their path and i think there's mental energy going into it. >> because they come up with products that people didn't think they needed until they see them. >> i think because the company's value based an tim's a great leader especially with their commitment to privacy it's going to really pay off in the future. >> reporter: now, cook then took the stage as he often does to
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field some questions from shareholders what did they ask him? the wearables business, cook mentioning this 50% growth rate there and hinted of what's to come with the watch specifically with wellness and health he talked about air pods, too. a cultural phenomenal and estimate sold 20 million to date and asked about risk are you taking enough risk with the products right now cook saying we don't focus on the 90-day clock we make investments for the long term, those to see inthree to five years back to you. >> josh, thank you very much for that we'll continue the discussion now. joining us are tripp cloudery and with us ted murphy, apple shareholder and ceo. thank you for joining us, both of you ted, you are bullish and you believe that despite the issues they have had on iphone sales in the last couple of quarters to rebound? >> yeah. it ultimately believe that apple
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is looking to the future, three to five-year horizon and thinking of what's happening with wearables, what they have done with augmented technology, what might happen with a pair of apple glasses, that's the stuff that really gets me excited. >> tripp, what is your headline reason for a sell rating >> let me give you a framework to think about in 2018, apple did a $73 billion of share buyback $14 billion in dividends and $3 billion in paying interest on debt a total of $90 billion total vested money none of that $90 billion is related to innovation. look at the industry leaders tesla, elon musk amazon, alexa. john rubenstein many start-ups they are storing the ocean
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apple is only stirring the cup the problem is this -- go ahead. >> but, tripp, i mean, long term they have a very clear track record of fantastic innovation and their cash balance is so high you wouldn't expect them to spend it all on research >> no. actually, that's wrong if you think about what else the focus of apple's executive team, $90 billion of this part liability versus -- and that is taking the focus out of innovation this nonsense has to stop if apple needs to innovate. remember two things. first, on the successful products apple launched was steve jobs' product road map anything that was not on the steve jobs road map has been a royal disaster example, apple home port
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looks like a toilet paper. >> ted, what is your view in terms of the innovation? on the phone, that's most important to them, they do suddenly look behind the foldable phones. >> yeah. i mean, i think when you look at those devices you have the look at the apple phone, the iphone right now and say, well, you know, they're behind you have also seen phones come out with five cameras on the back and that's concerning i'm really looking to apple to kind of leapfrog right? it is not just about turning your phone into a tablet it is what's next? and that's where i'm really excited about what apple may deliver in the future. >> if samsung and huawei and others making phones able to compete with apple on bringing content to the scene, making advances in health care, the wearables that go along with this, if you see the same sort of leapfrogging in terms of hardware technology, that we're seeing on the phones, in other
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areas, is that a threat to apple? >> i think it is a threat. but i think that what apple still has is ecosystem you know my company develops apps and i can tell you that developing apps for the apple ecosystem is way better than developing apps for the android ecosystem. they're diverse with different standards and really difficult to deliver the optimal user experience at the end of the day. >> tripp, talking about the bond balance, the corporate debt that apple has, money is really cheap. why wouldn't they take that on >> let me give you another framework to think about companies can be categorized into four categories companies who create services. companies who create products. companies who create markets and the companies who create industries idiots create services
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smart company creates products super smart companies create markets. and exponentially smart companies create industries. this $90 billion that apple had can create multiple industries the problem is there is no person who has vision in apple the only person that i can think about who has the vision and help apple out with innovation is john rubenstein, the father of ipod and the brains behind the massively successful amazon alexa. spend $2 billion and get that guy in >> the rest -- >> i think only way the investors see innovation back in apple. >> the rest are idiots according to tripp at apple we will have to leave it there thank you both for joining us. >> mike, come to just come back
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to the effect of buybacks have had on the stock is significant clearly. but long term, no one would expect them to innovate with all of their cash. >> that's exactly it apple was in an incredibly unique situation of $200 billion in cash and there's literally nothing smart you could do with that much money all in a rapid way, to be honest with you it's not a great return on that. apple could buy back an enormous amount of stock, support the debt they took on, representing half the cash holdings and at the same time raise r&dspendin which they have done in the last couple of years, as well. >> all right. >> leave that debate there. >> very plain spokenly, though i like that. why the equal weight of the s&p outperforming the benchmark by 2% this year. and a new report finds that more than a third of americans likely to boycott brands over how they view political leanings of those companies we are back in a couple of
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the equal weighted s&p 500 etf outperformed the benchmark index by more than 2% so far this year. so far this year mike santoli has more with more on what this means. >> what it means is that this phase of the rally is democratic stocks participating not just
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the biggest ones in orange, the etf tracking the equal weight of the s&p. i think 502 stocks in the 500 equally weighted and rebalanced accordingly ever so often. s&p 500 is largest with the biggest weights. this spread about 2.5% is pretty significant over a short period of time and saying broad participation on balance outperforming. we have another chart, though, that actually shows you a longer look at this from a full year. to show that this is a relatively recent phenomenon right? orange is equal weighted what i wanted the highlight is right here back in the summer, this is really about the top of the overall market record high there. the spread between the mega cap weighted outperforming the equal weighted and that criticism last year if you remember a few huge tech stocks driving
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this market and seemed to be unstable and unhealthy. >> one point, it does look like on the selloffs that the smaller caps led that. the orange lines fell fastest. >> equal weighted did, although down here pretty close basically it came off of a lower high and met down at the bottom. >> my other point, going back to the shorter term chart and the way that the equal weighted outperformed a lot of the narrative has been, oh look, earnings guidance is disappointing for the year ahead and for the median company, smaller caps including, it is not as disappointing. >> it plays into this. really more immediately ittell you that very huge companies have been lagging the market and there are these very, very large companies not participated quite to the extent and with risk appetites go up it is the small -- by the way, all big
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companies. it is not tiny companies but relative basis equal weighted is a smaller cap bench. >> thank you very much. >> i want to see him go crazy with a bird up here. >> i agree. >> snow on the tree. >> it should happen. >> it is a friday. i should have. time for a new cnbc news update with sue herera. president trump tweeting that his remarks about the death of otto warmbier were misinterpreted saying he holds north korea responsible for otto's death he says he loves otto and thinks of him often. the siege against islamic fighters holed up in a hotel in mogadishu is finally over. 24 were killed and 50 more injured. the death toll is expected to climb. all the attackers were killed. a former minnesota police officer charged with murder and manslaughter was in court today.
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mohammed noor shot and killed a woman in 2015 after she called 911. the judge ruling prosecutors cannot use his silence against him at his trial. and a north carolina walmart greeter has accepted a new position within the company. this after thousands of people petitioned to save his job jay melton will be taking an elevated role as a self checkout role as walmart e lemm nates and changes the role of the store greeters you are up to date that's the news update this hour i'll send it back to you. >> good to see. >> great to see there, sue have a lovely weekend. >> you, too. up next here on "closing bell," we'll look at whether perceived political leanings of companies to take a toll on their company's bottom line. find out if hollywood is relying on disney's "captain fi wel" to jump start the box ofcehen we speak to adam aron how do you gauge the greatness of an suv?
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welcome back some anti-trump republicans have
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settled on maryland governor hogan as their hope for a 2020 primary challenge to the president. our john harwood asked him what he'll be doing on the national governor's association trip to iowa this weekend. >> i won't be hitting all 99 counties and going to every diner and looking like a presidential candidate. >> politics out there, too >> i'll see folks and have a few meetings and looking forward to being in iowa. >> when you envision coming a conclusion >> i think the filing deadline's for, say, new hampshire in the late fall. today it might not make any sense but who knows where we're going to be in two months or six months from now? all bets are off we don't have any idea. >> is part of your thinking what the mueller report shows and how people react to that >> i think everybody's looking to see what if anything comes out of that. and i don't know i have no idea i don't have access to the information. if something really alarming, if indictments come out of there,
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if it leads to impeachment, things are a lot different than they are today. >> do you think if you had the 27 -- your 26 fellow republican governors in this room that most of them would say, go, larry, go >> no. i don't think that's the case. i think a lot of them are strong supporters of the president an they're in very red states and they certainly on your camera none of them would say that. having beers and no one was listening, probably half of them might say it's worth a shot. >> of course, the govern knorr has a unique perspective on this decision because of the role that his father played in 1974 in breaking with fellow republican president richard nixon and supporting impeachment. he explained that to me. >> it was very traumatic kind of thing for him to do, to go against the president he had supported. >> no man, not even the president of the united states, is above the law he consistently tried to cover up the evidence and obstruct
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justice and as much as it pains me to say it, he should be impeached and removed from office >> he paid a price for it. >> he paid a price and he knew he was going to. he said this is going to cost me friend and supporters and probably my political career and at the time, many republicans saw him as, you know, why are you going against our president? decades later, he has kind of a special place in history and a lot of people who even ones at the time who might have been upset with him think he did the right thing. >> and, guys, if in fact that mueller report has some serious findings that are damaging to the president, we will find out if contemporary republicans make similar decisions as larry hogan's father did. >> even as we stand almost 100% expectation that the president has the republican nomination? >> i think so. very close to it even if larry hogan got in the race tomorrow, it would be unlikely he could win and we
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have seen from history that when an incumbent president faces a challenge in his primary even if he defeats the opponent they're typically weakened that happened in 1992. >> john harwood, nice to see you. thank you. >> you bet. >> you can find the interview at cnbc.come/speakeasy. a new study of global strategy group finds most americans regardless of politics believe that companies should weigh in on political issues despite the fact that advertisements like nike's of colin kaepernick and jill let's the best a man can be sparked backlash among certain americans. how should companies navigate a complicated political environment? let's bring in julie from global strategy group and the author of this study to discuss it it is kind of surprising you hear consumers saying we want
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companies to take a stand. >> yeah. i think that's right what we are seeing is tremendous amount of activism you saw it at women's march, black lives matter, march for our lives. you also saw people turn out to the polls. consumers are extremely hungry for a level of activism we haven't seen and looking for companies to fill a role they fundamentally believe that the government isn't really filling. >> for democrats, the top boycott targets are chik-fil-a and hobby lobby. for republicans, nike and target if you're trying to appeal to the most people possible because you want them to buy your product, how does it make sense or how do you come up with a strategy to successfully navigate a very divisive political environment? >> yeah look i don't know that the goal for everyone is to appeal to as many people as possible i think about it a lot in the same way we approach a political campaign right? you have people who are your core customers, people who maybe always buy adidas and never nike
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and then some group of folks in the middle might be open to you if you connect with them in a particular way. >> i'm amazed at the level of support in this report, julie. 80% agree that people should be -- companies should be taking action, that high. >> yeah. >> who are the people surveyed how many people and what kind of demographics are they from >> yeah. americans nationwide we surveyed just over 800 folks and representative of americans across the country i think the interesting thing is both that there are, you know, 80 some odd percent of the american who is say companies should take a stand. over a third feel that way strongly and some intensity behind that. even more remarkable is not just that they should do something but they fundamentally believe that companies can help drive change. >> one of the interesting results i saw in terms of the perception of companies being more republican, the big banks are there. as well as nordstrom. >> yeah. >> seems to me that's an association with money
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as opposed to any effort by these companies to portray one or the other is there a way you can kind of correct for that if a company doesn't want to be seen a certain way? >> that's right. look we are living in a polarized world. people assign reflexively opinion. whether it's a democratic or republican issue i think what is interesting and what we have seen is that companies actually have a lot of leeway on the issues they step out on just because jpmorgan is perceived as a republican company doesn't mean they haven't stepped out on issues perceived as more moderate and democratic and found it's how companies articulate the position they're taking. >> julie, thank you for joining us discussing the report she authored global strategy group partner. u.s. box office for movies down 28% this year but amc entertainment seeing its stock go higher today on the heels of
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earnings mp'll talk to the ceo about coeting with netflix and the outlook for the rest of the year
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welcome back amc entertainment surging following strong q4 earnings the company beat on eps and revenue and saw the full-year global attendance hit an all-time high. >> joining us now in a cnbc exclusive to talk about the numbers and what is ahead for the box office, adam aron, president and ceo of amc
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entertainment. thank you so much for joining us con gara congratulations on the numbers what is driving it the movies or making this experience for attractive for guests >> well, thank you, contessa nice to be with you. the answer to the question is both, actually hollywood's been on quite a roll for 18 months now looking at 2018 which is what we announced our earnings for yesterday it was the biggest box office year domestically in the century-long history of cinema at the same time that hollywood's turning out great movies, amc has become quite a sophisticated digital marketer we have 19 million households. or so. in our amc stubbs loyalty program. 705,000 people in our monthly subscription program, a-list we are doing about a billion and a half e-mails and texts a year
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to avid movie goers. we are good marketers and hollywood's making great movie product. >> but the domestic box office is down 25% to 30% from where it was at this point last year. can that be made up in the months ahead which films could help you catch up >> oh yeah we always knew that 2019 was going to start slowly just on the strength of the movie slate. you will recall that last year in february we had "black panther. if you look at the full-year 2018, the box office domestically was $11.9 billion that's up almost $700 million, $800 million over the year prior. when you look at the entirety of the film slate that's coming out, all of 2019, this very well could be the first year in history where the domestic box office crosses $12 billion there are enormous titles ahead
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of us this year. junction next month "captain marvel" and "u.s.," "avengers" and we have counted more than 30 different film titles coming out later in 2019 that are going to resonate to resonate with consumers in really big ways. >> adam, nonetheless, there are threats to your part of the business and the likes of netflix putting a lot of money into making movies and deciding to prioritize their streaming platform rather than your movie theaters you decided not to air "roma" because you disagreed with netflix' time schedule for how long it could be in movie theaters before it would be on the streaming platform what are you going to do with "the irishman. huge amounts of money and huge stars in it. will you air that? if not, do you hope netflix fails with its push into movies. >> well, you know, this isn't a contest between netflix and amc or the movie industry generally.
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last i checked, netflix was around in 2015 doing quite well, i hear at the same time hollywood and movie theaters across the united states, including amc, had the biggest box office year in history. we had record attendance as you said, we sold 360 million tickets at our theaters around the world last year, an all-time high for our company in our 98 1/2 years in existence. as for netflix and, for that matter, "irishman" and for that matter "roma," we'd be delighted to play any movie from any studio, including netflix, that respects the decades-old theatrical window. it suggests that movies come to theaters first for a couple of months and then they go to the home if that's what netflix is willing to do, we'd be delighted to show their movie in the fall. but we do value the theatrical window, something important to our company, something important
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to our industry and it's something we intend to continue to respect. >> the popcorn is always better at the movie theater today. >> it is true, i have to agree with that. adam, thank you for joining us >> thank you and we do a very good popcorn, grown in indiana, i might add. >> oh, the best ever i used to live there, i know. all right, so today, hail caesar that's what the icon group is likely saying. it's on our radar, next.
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uniform supplier, or kit supplier, as i would have said, taking the spot away from nike that will begin the 2019-2020 season it's estimated that it will be around about $90 million per year. >> size doesn't really matter, does it? >> it does when you're talking cash, i think. anyway, this comes to rival with manchester united, which is the biggest one to date with adidas for their kits going from big company nike to puma. >> i'm just back from las vegas and hot off the heels today of a caesar's entertainment announcing a deal with activist investor carl icahn, appointing three of his nominees to the company's board, adding a condition to appoint a fourth if a new ceo is not approved pie the new directors within 45 days they have been on the hunt for a new ceo. carl icahn has put forward a name the general consensus is that
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he'd make a great cfo but maybe not ceo so they're still on the hunt for more. but that now is the urgent matter, along with the fact that icahn is pushing them to put themselves up for sale who could buy them el dorado resorts made an overture. >> and the market liked this. >> it was up 3% on the day. toy maker mattel wants to cash in on the movie business. the new film chief says there are plans for movies on barbie, hot wheels, the magic 8 ball and uno. also she said viewmaster do you know viewmaster, the slide toy. >> look what "toy story" did for toys. >> and "transformers" from hasbro is the big example. >> there is a new "toy story" moving coming as well. >> that's true. >> we have about 30 seconds left in the show. mike, today's gain flattened the week performance and took is
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into the week. >> some people think weekly gains and losses matter a lot. it's sort of steady as she goes. the rally is intact but has flattened out. >> that does it for "closing bell." have a lovely weekend. "fast money" begins right now. "fast money" starts right now. live from the nasdaq market site overlooking new york city's times square, i'm melissa lee. tonight on "fast" the tech rally is rolling on as the nasdaq leads the dow and s&p 500 in gains for the year if you missed the run, the chart master said there is one stock to help you play catch-up. plus lyft will have its public debut this month. first, we start kicking off march in the green it has been the best start to the market in nearly 30 years. the nasdaq with a ten-week winning streak and the s&p closing above that key 2800 level. so with spring just around


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