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tv   Closing Bell  CNBC  July 22, 2019 3:00pm-5:00pm EDT

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they were stalled and what is this going to tell us about that. >> unless huawei is a national security risk based on in part that "the washington post" story that we have a report on >> explosive stuff. >> this is something to watch. thanks for watching "power lunch. >> "closing bell" will start in three, two, one seconds. good afternoon, welcome to "closing bell," 59 minutes left of trading i'm will fred frost. the equifax post, biggest ever data breach settlement find. we have the ceo joining us first on cnbc in 15 minutes time. >> i'm sara eisen. let's get right to what is driving the action higher right now technology is leading after some bullish analyst calls on the semiconductors and apple, investors awaiting busy earnings reports and the federal reserve next interest rate move, still pretty unclear joining us for the hour, steve
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grasso is back welcome, steve. >> thanks for having me. >> technology making a move higher thanks in part to the semis. >> first you have that semi upgrade from goldman sachs that's put a flame underneath the whole space. they're leading and also have the f.a.n.g. stocks reporting. that's what is driving the market action. >> does it tell you something about the cyclical leaning. >> it tells you -- it gives you the impetus of, hey, what got us there? what is going to be the mainstay >> people like to keep riding the horse that's delivered the returns and that horse has been tech. >> horses are scary. let's drill down on the big stories we're watching a meeting with chip executives will take place. phil lebeau, a credit warning or boeing and bob pisani are looking at the other moves and seema mody looking at the impact on oil and iran. ylan, let's start with you. >> it's expected to get under
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way in a half hour several of the executives are already here my colleague kayla tausche and i have confirmed some companies attending, qualcomm, micron, broadcom and intel that meeting is expected to be led by treasury secretary steven mnuchin and larry kudlow and the companies are concerned, of course, about the current restrictions on u.s. exports to huawei but more broadly they are concerned about how the white house's executive order might be interpreted. can they still participate in writing international standard for 5g is the question the companies will be asking today at the meeting back over to you >> ylan, thank you to boeing, the biggest drag on the dow after fitch raised a red flag phil has details in chicago. phil. >> sara, fitch has dropped the credit outlook for boeing from stable to negative and all of the concerns revolve around the 737 max including when will it
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return to service? could that get pushed back we should point out the credit rating they have for fitch remains "a." last week it was boeing that said they're going to be taking a $4.9 billion charge for the second quarter they'll report second quarter earnings before the bell also when we hear from dennis muilenburg on wednesday and regarding the airlines, one of the concerns fitch brought up we will air from american airlines reporting earnings on thursday morning. >> let's bring in bob pisani with a look at the other movers at the exchange. bob, what's the headline >> tech and to a lesser extent industrials so take a look at the big tech names right now intel has been a perfect "v" that continues up 2% 7% for the month apple strong, microsoft strong, sysco strong, all about tech today. industrials a little bit mixed these are the ones i want to hear with. we'll hear from 3m thursday.
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disastrous warning in april and month of may united technology out tomorrow caterpillar on wednesday and bying wednesday. continuing disaster in the department store space, nordstrom. not a lot of highs and lows but another new low. they're down almost 40% this year every day is a new low and not much different from the other department stores. jcpenney's, macy's, kohl's more than 20% down this year. >> bob, thank you. oil prices ticking higher as global tensions with iran ramp up seema is all over that. >> well, rising tensions between western powers and iran would typically command a larger reaction in the oil market oil prices higher by 1% to 1.3%. analysts say they're waiting to see how the u.s. and uk will respond to iran's seizing of a british ail tanker friday. president trump reiterating he is taking a wait and see approach but noting it's getting
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harder to pursue a broader deal. analysts at rbc still think prices could head higher in the pras secretary of a military threat becomes a more realistic scenario sara, back to you. >> thank you the debate over the federal reserve's next move ramping up with just over a week to go before the big decision. late friday i spoke with eric rosengrin of boston who said he doesn't think the fed needs to cut rates right now. >> we don't want them to be so low we put asset prices only temporarily up only to be disappointed as time goes on and have more of a reaction on the negative side when the economy does low it's all on the up side but i think as long as the economy is doing well, if that continues, we don't need accommodation. >> so, sara, on vacation with eric rosengren. >> i came back he had a speech at columbia.
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>> well contact back but outstanding interview. >> takes a fed president, voting members own will i to bring me back. >> oh, my god, you're such a greek. glad you did grabbing the news still today. pretty significant. >> it shows it's not a unanimous decision if the defed does cut rates as powell has indicated he wants to do. there are voting members and you could see dissents and robust discussion about whether it's appropriate or costly to do so we know where the president stands he took aim at the fed again today on twitter tweeting out, it is far more costly for the federal reserve to cut deeper if the economy does in the future turn down productive to move now for more let's bring in diane sw swann. so, diane, is the president right that it's inexpensive and
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productive to cut now or is eric right it could be costly to cut now? >> that's the tightrope the fed is trying to walk. do they cut which is in part in response to the white house policies on trade and a weakness of grade globally and slowdown we're seeing globally. on the flip side they don't want to stoke price bubbles which is what we're seeing so trying to walk that tightrope it's important to see the dispersion of views as you did with eric rosengren. the other side is to hold back a little bit i do think they'll end up cutting by a quarter point by the end of the month but will deal with this insurance policy hedging the downside risk on a cautious basis two cuts this year i think but not the 50 basis point cut the president is looking for >> kristin, where do you stand >> so our base case is 25 basis points as well the market is pricing in more
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than that. if we look to history, when the market is pricing in this probability the fed generally agrees 18% of the time the fed follows suit so now the question is, is it a hawkish or dovish surprise from there and dovish surprises happen twice more frequently than hawkish so the question really is, is it 50 basis points instead of 25 but we're sticking with 25 at this point. >> where do you stand on this debate >> well, when you start to look at what's happening in the history of all this, that goes out the window for me and i'm sure you would probably agree. this is a different fed than we've ever had and different president than we've ever had. look at last week, the percentages, they change from minute to minute, hour to hour depending on who says what and when they say it. >> a dangerous game if the fed is basing it on the market. >> dangerous -- i don't think the fed is basing it on the market the market is bases every word the fed says and trying to elaborate that through the marketplace. that's dangerous. >> diane, what is the swigs if we see a genuinely divided fed
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at the next meeting with a number of people voting against what they final decision is? >> well, i think we'll see one dissent. i think we'll see one dissent on the fed. i don't think we'll see a number but important balancing act. i think the fed has to send a message that it is willing to sustain the expansion as powell has made the new goal and willing to make a hedge bet on hedging the downside risk to the economy now and also, remember, inflation, although as eric rosengren said it's close to 2%, many say the symmetry in the fed's target you got to run it hot for awhile, above 2% and we have not done that for the fed to have credibility so they'll do that but having dissent is also a message not only that the fed is worried about stoking asset price bubbles which is important but an important message of independence which president rosengren got to without attacking the white house and saying anything in response to the white house i think very carefully in your
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interview, sara but it was important. important defense against we're making our decisions independently. >> yeah, i mean he said absolutely zero impact from the president. the tweets don't even get discussed around the table i said, really >> they don't. they do get discussed outside of the table, but they don't get discussed around the table >> so kristen, does it follow more and more and more -- >> what playbook is the fed following right now and it actually looks like the fed is following their playbook from the '90s where they're preemptively cutting rates and doing that to contain and sustain the economics -- >> is it going to work >> we don't know yet so the guidance from here on out is what's going to be key is it one cut? a series of cuts if it's just to contain the economic expansion then from there you have about another 12 months where we could expect equity prices to rise.
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if it's concern about global growth and this is the important part of the messaging, if it's just to continue the expansion it's one thing, if it's concern about global growth and concerns about a recession, then that's actually quite different and our advice to investors is then you would have to be positioned a little bit more defensively. on the one happened you're positioned leaders tend to narrow in the end of a cycle, continue the expansion, look at cyclicals. if it's concerns about growth you want to be position the defensively. >> diane and kristen, thanks for joining us. still ahead, much more on the up coming chip meeting in washington set to kick off in a moments and discussion what executives want to hear from the white house and what it means for the stock prices. equifax ordered to pay up to $700 million as part of a record ftc settlement over its massive 'lta scandal wel lk to the ceo coming up next with xfinity mobile you can bring in your own phone,
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24.01. the dow has swung more than 140 points in today's session. let's head over to mike for the market dashboard today mike >> thanks very much. here's what we have ahead. first hitting the wall look at 12-month forward earnings forecast plateauing. cracking the ceiling we might have a debt ceiling. the history of markets when it came to debt ceiling showdowns stair-stepping higher to look at the position of the s&p 500 as the pause and betting the house. an examination of whether the market has too many concentrated bets in a few big stocks hitting the wall here's a chart of the forward earnings estimates for the s&p 500, earnings per share estimates and it's plateaued a couple of times here once last fall we kind of stalled out around the 17 alevel then went down into the market, that's when we obviously pull back in the markets as well and now we've
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kind of plateaued again right here around 176. now, why is that did we revise earnings estimates much higher? no because of the calendar 12-month forward estimate now includes the first quarter, maybe into the second quarter of next year. that's when earnings growth is supposedly set to return to 10% annual levels so right here you see it's a little struggle to get any altitude on these earnings forecasts basically less than a dollar above where we were when it had that peak last september forward multiple, this, again, you see this plateauing effect where the market topped around 17-oichlt 17-oichlt. we can expand this more but unless you get clarity next year's earnings will come through it might be a struggle which is probably why the market is focusing on those more reliable growth stocks, at least it believes them to be reliable, guys. >> all right, mike, thank you. see you in a bit equifax reaching a settlement
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with the ftc after its data breach the company will pay up to $700 million, largest data breach settlement ever ending an array of state, federal an consumer claims that have lobbied at the credit bureau. lobbed at the credit bureau. does this put an end to the crisis joining us now for first on cnbc interview mark begor thanks for chatting with us today. >> thanks for having me, sara. >> so first if you would just take us through this settlement and how much of it will actually go toward consumers. >> the focus of the whole settlement was around consumers and, you know, as you know the cyberattack on equifax in september of 2017 was significant. significant on the company and on u.s. consumers and if you look at the 700 million settlement that was announced today the bulk of that will go towards consumers. there's $380 million fund of which 300 million will go directly to consumers for credit bureau monitoring, identity r t
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restoration or if there's evidence of identity theft for reimbursement for that and then there's also the payments to the ftc, cfpb, state attorneys general and new york state department of banking. this comprehensive settlement was a priority of ours and is quite unprecedented to bring so many groups together and second priority of ours and regulators was a single consumer fund a focus on, you know, doing the right thing for consumers and just one last point, that we tried to be clear about. there's no evidence to date that any of the data that was stolen in september of '17 has either been sold on the dark web or any increases in identity theft to date >> so where is that? what do we know about it >> a great question and working with the regulators and i know the fbi and department of justice are working to figure out who are the criminals that committed this act against not only equifax but most importantly against u.s. consumers and we'd like to bring that to resolution but today's announcement puts that consumer fund in place that will really give consumers some peace of
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mind that their identity is going to be watched with the credit monitoring that will be offered and the other services >> there's been some criticism, mark, that the consumer funds may not be fully drawn down that it's actually quite tricky for consumers to go through all of the hoops to claim the money they're due. of the $300 million figure you mentioned, how much of that do you expect to pay out to consumers in, say, the rest of this calendar year >> yeah, we haven't nailed down the timing of when the fund will be established it could be as soon as the end of the year. as you know that goes through a court process and, you know, we're eager to fund it but the whole 300 million will be paid -- it's a actually 380 million including legal fee, 300 million in the consumer fund will be paid by equifax in its entirety to the claims administrator and then the claims administrator which is a third party will go out and communicate with the consumers that were impacted and offer all the services that come with that $300 million fund. >> i mean, you've heard the
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criticism. you've gone through the hearings yourself already hearing from senator ed markey saying for years equifax compiled dossiers on american consumers on a massive scale. played fast and loose with the data the settlement is far from adequate what else are you doing to assure consumers that their data is safe with you beyond the fine and paying off some of the claims >> it's a great question, sara when i joined as ceo last april there was a couple of priorities i had for the company. you know, first and foremost put consumers first. we wanted to be and were planning to be the most consumer friendly credit reporting agency in the united states second is really to have industry leading data security and technology and we committed to an incremental billion and a quarter multiyear investment up side of equifax to really take our technology and our data security to industry leading capabilities and that incremental billion and a quarter is a sizable ability of
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equifax and about a 50% increase if what we would spend in technology historically so committed to putting consumers first and security and technology because we know the sensitive data that we're entrusted with is data we need to protect >> mark, how confident are you it's equifax, the regulators and some of your competitors won't face this sort of thing again? how confident can you ever be that this won't happen again >> you know, it's a great question and from my perspective after living through this for the last 18 months and the team living through it for almost two years cyberattacks is probably the greatest threat not only american companies face, but companies around the globe as well as governments. you know, companies are attacked every day and you and i see announcements every week of cyberattacks it's a war that from our perspective isn't going to end and an attack on a company like equifax is an attack on u.s. consumers and attack on americans. now what can we do about it is really the investments we're
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making in security and technology we brought in a whole new security team. a whole new technology team and we're buying and investing installing the very best process east, technologies and protocols out there to ensure that we're the safest out there that said we get attacked every day and we're preventing those attacks but they'll continue and it's really a war that is being attacked on every american company. >> what can you tell us, mark, about consumer behavior and how it's changed after this very well publicized very broad attack have more americans frozen their credit reports have they switched out i don't know if they can even switch out of your system? what's the i believe packet from a consumer standpoint on your business. >> as you may know last september the senate and house passed a bill called senate bill 2155 that allowed a free freeze on your credit file and many americans have taken advantage of that with all three credit bureaus. equifax following the data
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security breach earlier last year launched a mobile application called lock and alert that's available for free for life just like the freeze from senate bill 2155, our lock and alert product allows consumers to lock their credit file with their phone or their ipad and then open it when they plan to use it so there's more tools out there for consumers to take advantage of it you know, that said we play an integral role and i think you know that in the consumer economy. you know, whether it's a mom and dad who are trying to help rent an apartment for their son or daughter and cosign on it next week or someone buying a refrigerator at an appliance store on credit. you know, we facilitate all of those transactions so we play an integral role by giving consumers more control through the freeze that was passed by the government or our free lock and alert product is clearly something that we're supportive of >> mark begor, thank you for joining us today. >> thanks very much. >> on the settlement, the ceo of
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equifax. and just for the record he was brought in after the ceo who was there during the data breach resigned he's actually a veteran of ge. ran their credit card business a handful of players in the space. the stock has run up into the settlement it's worthy of a note this is where the stock ran into resistance in the past right before they had the issue and most recently in the last couple of weeks. >> so you're saying if you want to buy you missed the move. >> you want to wait till it crosses over the 140 mark. the stock up over 40% year to date and i think people are forced into them whether you like it or not it's them and a handful of other players. two other players so whether you like it or not they will adapt and change but they will remain in existence so even if these breaches happen again, unfortunately it is a quasi-t
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quasi-triopoly >> i don't think there is a direct read across a stock specific issue you see after a 2 1/2-year process, how hard it is for regulators to really extract any more out of a company. 700 million, you know, the stock is up off the back of despite quite a significant -- >> you heard what he said. the biggest threat is cyber, crowd strike what's why the stock is successful as well. >> up 0.7% today up next, upgrading one publicly -- recently public name, nearly doubled from its ipo, recently going public name. we'll be back in a couple minutes. tell him we need this . (in dutch) it's happening..! just ok is not ok. especially when it comes to your network. at&t is america's best wireless network
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welcome back to "closing bell." stitchfix, upgrade to buy. management ability's to drive average revenue per user growth and highlight opportunities in the uk business, interestingly they do say it is a good time to buy. >> ubs upgrating hershey to neutral. 145 price target saying it's choc-full of price increases, ha, ha also follows another upgrade for hershey. goldman sachs. speaking of goldman upgrading micron to buy getting more positive on memory stocks and says the excess memory chip
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inventory will be depleted faster than expected and pricing will improve in the third quarter. you mentioned this and how it's helping all the chip names >> it is a commodity, supply/demand. when you look at d-ram prices no other chip company is more dependent on d-ram than micron they account for over 66% of their revenues but if you look at d-ram it's rallied about 10% and micron rallied over 50% two things goldman is probably late on this call, nothing against goldman but i think this has been in the makings and sort of in the move of d-ram so kind of overdone but the rest of the street watches what goldman says so might have a longevity in that call. >> they're also pretty bullish on pricing as well but you're right it does feel like a catch-up call and more broad to the sector of which they're saying micron is perhaps the best way of playing it than micron specific. haven't uncovered anything no one else has seen. >> semis have had a move up. 35% off their 52-week lows and
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in between the better huawei news we'll learn more about this hour. >> better trade headlines. softer headlines so i think it's a potpourri, if you will, of positive news for the chip space and goldman is putting the cherry on top and might be late but might get that run because you have a gap between the blackout with the fed, so far we have a lack of things -- >> a potpourri with a cherry on top. >> you and mr. rosengren on vacation. >> he was at the cape. i was at another coast. >> 30 minutes left to trade. tech still leading after bullish analyst calls on the semiconductors and apple awaiting a busy week of earnings report and fed's next move unclear ahead of next week's meeting. why we're only up 14 points on the dow. >> with 30 minutes to go time for a cnbc news update with sue herera. here's what's happening at this hour. president trump welcoming the prime minister of pakistan to the white house.
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he insisted to reporters that he will not be watching former special counsel robert mueller's congressional testimony on wednesday. >> i'm not going to be watching mueller because you can't take all those bites out of the apple. we had no collusion, no obstruction. we had no nothing. we had a total no collusion finding. the democrats were devastated by it. >> puerto ricans marched by the thousands to today for what many expected to be one of the biggest protests ever seen in the u.s. territory pledging to drive the governor ricardo rossello from office after he said he will not run for re-election but he will not resign. the fda is taking its prevent e-cigarette use to teens to the airwaves launching two tv ads warning about the dangers of vaping it's a part of the real cost youth e-cigarette prevention campaign
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you are up to date that's the news up date at this hour guy, i'll send it back to you. >> thanks very much. let's send it over to mike for the second installment of his dashboard. >> hearing talk about a debt ceiling deal potentially and of course fed chair powell mentioned the debt ceiling showdown if there was going to be one as a potential risk going out but evokes the 2011 episode where we did really go down to the wire in terms of the u.s. debt ceiling and markets reacted. here's the market from july of 2010 to june of 2012 which kind of brackets that period. so this is the s&p 500, the long-term treasury etf and gold. right here you saw gold ramping up right into that agreement when we finally got on the debt ceiling and stock market plunged and bond yields somewhat ironically rallied into -- bond prices rallied into that debt ceiling showdown now, obviously that was the most dramatic example yes, we had a lot going on the european debt crisis and all
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the rest look what's gone on in these three assets since the deal struck in august of 2011 and very clear, stock market is up 150% it's been a tremendous run gold still down 18%, even after its nice rally recently and bonds have done fine they've been slow and steady yeah, sure, you can look at gold coming up and say maybe there's nervousness, this, though, is why i think the market is essentially saying i'm not going to pay attention to the debt krooling felt stupid to sell on it back then seems as if the market has been cured of this. don't know if that's correct or not but seems as if it was going to wait until the very last moment to react if we were going to get anything. >> thank you steven, is the market just calling congress' bluff that it's too hard to imagine them ever not raising the debt ceiling. >> i think they know too many people have too much to lose and it's usually the reverse but this is one where you sell the rumor and actually buy the news where it's reverse in the marketplace with stocks but this one you always want to buy the end of the world debate on these
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type of position. >> because it's not going to happen. >> it doesn't happen. >> people are -- >> people said that about brexit they've said that before. >> it's true. >> this is different, though, because we've literally had this particular issue. >> over and over. >> and haven't had that with brexit haven't had that same particular issue with brexit. >> we had one moment and it's dragged on and on but it's an extension of one issue anyway, let's not go into that still to come we've got your last chance trade. steven is watching one name that's up 40% so far this year but down 20% from the past year. we'll reveal that. >> a puzzle for you. >> you kind of already revealed it. >> i did >> you -- >> no. >> but the stock has been mentioned today. >> oh, okay. it's been mentioned this hour in a different context. chip executives set to kick off a meeting at the white house any moment we'll discuss how much huawei means to the industry and what ouhos gn omhefr t meeting. which brought people together to invest in all the things
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top executives at intel, apple, google, micron, qualcomm and microsoft are meeting at the white house to discuss huawei. here's qualcomm ceo steve
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mallinkroft walking toward the white house. just video footage there of them arriving >> miss those red carpet arrivals of ceos going to the white house. >> they would go around the table and introduce themselves this is where the great good suit came from one of my favorites. how will it play out for the sm semiconductors how much wiggle room is there on the issue with huawei? >> well, it's political so it's infinite, isn't it if you stick -- hone to the party like difficult for the trump administration to provide waifers to american companies while at the same time lobbing european allies to ban huawei equipment from their systems if you stay consistent there's not much wiggle room at all. >> so, just to be clear, ed, the administration so far let's review, first blacklisted huawei and then at this g20 truce president trump said we can work
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with huawei, right american telecom companies can work with huawei but some of the members of the administration including peter navarro said there's still security concerns so it won't be so clear cut. what exactly do we know about whether chip companies can do business with huawei >> right now huawei remains on the entity list and for most companies, almost all american companies, that's the end of the road right there as soon as they are put on the list we talked to many ceos stop shipping that day and won't risk, you know, the give and take of politics to start shipping stuff now and run into trouble later so as long as they remain on the entity list most won't ship to huawei if the administration wants to make exceptions or issue licenses or special dispensations, that's completely up to them but it will undermine their credibility in congress and with allies if they start doing that for american companies so i don't see where they're going to get around a lot of this, either take it off
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the entity list or don't and if it stays on you won't be shipping to huawei >> ed, switching to focus. big week for tech earnings who are you furthest from c consensus on >> in the week ahead it's qualcomm doesn't report for another week out i think their troubles with the ftc in the u.s. district court are much more serious than the market is giving credit for and that's under accelerate add peel this he won't talk a lot about on the call but the consequences will become evident in the next six months outside of that i think the economy is shown robust growth here soy a lot of the diversified names like t.i. and intel will probably see better than expected now that you're over the huawei hump and most of the bad news is in there position for a bit better of an outlook given all the bad news of the last six months >> how do you play the group, steve? >> so, for me when i look back
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at the index, the semiconductor index topping out right here or i should say right at the level where it did top out back in april so i would wonder and that would be my question to ed, i wouldwonder if all of these run-ups that you pointed out and we see in the stock prices, are they already in the name already? are they going -- are they set up to fail when they actually -- when the rubber hits the road on the fundamental side i think a lot has been perception versus reality and just more about leverage and positioning versus actual things getting better in the space. i think that's already in the price and i would like to know what ed's position is. >> go for it. >> depends on the companies. very different companies like texas instruments, for example, are highly diversified they're selling basically, you know, semiconductor hardware to the world so as gdp goes so goes t.i. had a bit of a bump because of huawei and apple but results have been fairly decent. now, i think your assessment is
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exactly correct. we had quite a bit of bad news in the last six months with huawei and big sell-off late last year. people started looking at the economic news, the jobs reports, they realize the economy isn't as bad as expected so my impression is from talking to folks that the expectations are fairly low depends on the names you're dealing with cell phone names, it's more skittish apple hasn't done well and huawei issue in many of the names i think expectations are fairly low going into the quarter and the second half of the year. >> ed, thanks for joining us >> pleasure. >> we've got a news alert on disney julia boorstin with the details. >> well, sara, disney's success with "lion king" and the box office was bigger than the studio first thought disney now saying that the final number for domestic box office for this weekend was $191.8 million that's about 7 million more than the studio first reported. that's due to strength at
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theaters throughout the day on sunday and the global number for the first ten days the film was in release is now $543 million that's also about $8 million than first reported and nearly $100 million of that global number is from china based on these new numbers "lion king" is now the eighth biggest movie debut of all time surpassing "the avengers" "the age of you will tran." >> it doesn't surprise me despite all these negative reviews. it was always going to kill it of course it was >> that's the thing. >> beyonce, seth rogen. >> you have so many star, have you this iconic -- this iconic title that people are so familiar with, but it has gotten pretty negative reviews, just around 53% on rotten tomatoes and there was this question of whether re-creating this animated film, this new digital format would just frustrate fans and turns out even though critics weren't so crazy about it, fans really did seem to like
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it. >> well, another 20 bucks or so to come, i'm definitely going to see it. >> prince harry and megyn shan it >> you obviously go to premieres if you get invited free film, red carpet. up next we've got your last chance trade it's a real special one for mr. grasso >> later, more than 130 companies reporting earnings this week. results from whirlpool and td ameritrade kicking things off after the bell today "closing bell" will be right back dow going up and down around the flat line. we'll be right back. since my dvt blood clot
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trades steven last chance trade. what is it >> not for the faint of heart. general election i've been long on this one for awhile now right around these levels so this is sort of a make or break. if you look at the chart, it is flattening out here. it's right on its 50-day moving average sui basically 10.10 but steven tussa had a tremendous call you can't be negative of a $10 name anymore he's had his time. great call it's time to get positive. if there is an earnings beat it is off to the races. >> you've been long for this at this level. >> around this level astin entry point so i do believe it's still -- but if you are a little queasy and you don't want to take the risk, this story has many innings left and they could go negative. keep it on a short leash have your exit strategy in tact but with the free cash flow, steve says with the boeing delays it helps them. >> we know you have to go out
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and close out trades thank for being with us. we've got 12 minutes left of trade. we're counting it down to td ameritrade and whirlpool after the bell we'll preview those numbers for you next you should be mad at airports. excuse me, where is gate 87? you should be mad at non-seasoned travelers. and they took my toothpaste away. and you should be mad at people who take unnecessary risks. how dare you, he's my emotional support snake. but you're not mad, because you have e*trade, whose tech helps you understand the risk and reward potential on an options trade it's a paste. it's not liquid or a gel. and even explore what-if scenarios. where's gate 87? don't get mad. get e*trade and start trading today.
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eight minutes to go before the close. the market movers. shares of beyond meat surging today after a positive beat from barron's bullish out of its stock calling the market's latest cult stock beyond meat, just trading up a normal day 10% goes through these crazy swings. >> barbecue season an extra help. >> meatless meat on your barbecue. >> i don't get the fishless fish not sure about that. we'll see. i wouldn't have believed in this one either and that was definitely wrong after the bell we'll get whirle pop earnings contessa has a preview >> they raised prices and increased profit margins in spite of lackluster revenue growth for the second quarter consensus estimates call for a year over year decline in revenues of 2.2% or $5 billion. but earnings per share of 371 or
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growth of 16% over the last year now, analysts will look for insight into the impact of ongoing tariffs. cost inflation which has moderated recently and where in the world demand is strong for whirlpool, maytag and kitchenaid and where it's not wi will wilfred >> we're covering the angles the dow is just turned nate.egiv s&p and nasdaq still high. don't go anywhere.
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don't get mad. get e*trade's simplified technical analysis. >> announcer: "closing bell" is sponsored by e-trade the original place online. >> four minutes left of trade time for the closing countdown just higher again on the dow yo-yoing above and below the flat line. nasdaq up 0. % trade the close with mike lewis, managing director of u.s. equity trading at barclay's good afternoon tech very much leading the charge what's driving that? >> good afternoon, guys. so it's just, you know, today we're seeing a rotation out of defensive into cyclicals and the semi universe and tech in general seeing strength. you know, you can see it when you look at reits, utility, all down some of the cyclical stuff is up it's just a sign of crowded positioning and, you know, so
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that is what we're seeing there. i think some of the big catalysts we're seeing for the week ahead, big, big earnings week or tech we have the ecb later in the week and positioning is pretty crowded. not just in cyclicals defensive crowd but in general long only, even the systemic stuff like vol target funds. earnings have been decent up to this point and pretty much good news baked in across the board from u.s. china talks to the fed to dovishness, my guess is that we're set up to see a little bit of a retracement just positioning very full and i think that given the magnitude of the data coming up this week and how position something we could see a sell-off in the next week or so >> mike lewis, thank you for checking in ahead of the close over to mike santoli for the third dashboard. >> sara, thanks. one week ago today that the s&p 500 hit its record high. let's put it in context here we've softened up over the last
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five trading days but below the surface there's been a little more of a defensive tone it's still mild at this point but i'll show you what people are focusing on. this little impact right there you kind of have the makings of a little bit of a peak and then shoulders around it. maybe it's something similar to what we saw in april no saying whether that will be the case but seems to be you have to work off a little bit of aggressive sentiment and positioning and then obviously we built in a lot of expectations on the fed and earnings right now the level you should be looking at want tock hold around 29.50 that would kind of keep you above this range that we crossed around june 1st. rick santelli a look at bond. >> you know, none of the treasury complex anymaturity stuck its head above water meaning yields were a bit lower today. intraday of 10s hovering at the highs in our time zone at 204 but settle at 206, june 1st chart. 195, the day before the fourth of july is the cycle low going
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all the way back to the end of 2016 look at boons in the same time frame. the right side drooping. lots of pressure from overseas yields big week with the ecb meeting. leader of the pack, bertha, nothing but upside from that index. >> it certainly has in larges of large companies. small caps seem to be a drag i the chips moving higher with goldman upgrading the chip equipment stocks in addition to micron and memory makers but also we're going to see a lot of those big cap tech names reporting earnings this week a lot seeing anticipation there. they better report good numbers as we've seen with netflix not priced to perfection it will be punished. over to bob. >> big week for industrials. bertha, we'll see what happens 3en m got clobbered in may with that earnings warnings down 25%. utx tomorrow
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caterpillar and boeing wednesday, want to point out the continuing carnage in department stores, nordstrom, another new low today down about 40% for the year and a lot of other weakness like macy's, kohl's and jcpenney the closing bell dow jones industrial average essentially flat on the day, fractional days for the s&p 500. good afternoon, welcome to "closing bell" i'm wilfred frost. >> i'm sara eisen along with mike santoli, take a look at how we finished up the day on wall street remember we're coming off a loss for the week for the dow, s&p and nasdaq, first loss in the last three and most of the major indexes did close higher including the dow which was kind of going up and down all day thanks to higher apple, lower boeing s&p 500 up a third of 1% the nasdaq did the best, technology ruled the day information technology especially with some of the
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outperformance of chip stocks and russell 2000 is where i wanted to zero in in terms what have stood out, down 0.2%. down 11% from the highs so still in correction territory. question is, you know, with most of the companies in the russell small cap companies, they get most of their revenue exposure in the u.s is it an economic tell about worries in the u.s. or is it a buying opportunity, sort of a contrarian bet. >> the markets flattened by some of the big cap tech stocks, mc, apple and chip stocks, relative to the dow highlights that as does the sector performance on the s&p. tech was up more than 1%, nothing else was up as much as half a percent and yields slipping again down to 2.04 on the 10%. long end down, so more bearish tilt in there. >> joining us to talk about these scott rand, senior equity strategist at wells fargo institute and kevin gibis at
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raymond james. we'll hit him on jeeldyields sector performance and this kind of slow and quiet march higher. >> i would say slow and i would say that you have a little bit of heaviness late in the day it's been maybe the fourth or fifth day when it seems as if it sags not necessarily intense selling pressure but people kind of waiting for the earnings and nine days till the fed and hear from that so i do think sectorwise megacap in terms of apple and microsoft can do a lot of, you know, basically can move this market on a slow day and that's what happened today along with the semis other sector stuff, though,i came in today saying people have probably been overpaying for the sense of stability and certainty in some of the very defensive areas and backed off a little of those today but hard to pull out really an economic message much more about where the money has been sitting for awhile. >> scott, how are you feeling about the momentum behind u.s.
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markets at the moment? >> well, wilfred i think we're stalled. we've been stalled here. less than a percent away from the all-time record high and after you have this gigantic bounce off the christmas eve panic low, the markets thinking there's going to be some positives in terms of trade, you know, i think earnings will come in better than expected although you know the results will be lousy just relative to what, you know, we're used to earnings growth being and so i think that there's a lot of people that are underinvested. the fed is on our side at the very least they're not going to hike rates. we think the cut next week is almost a certainty so, you know, there's some things that are positive that have been holding the market up here but certainly there's some risks and one of those big risks would be these trade negotiations falling apart and certainly the market to go down on that >> gavin, wilfred mentioned yields they ticked a little lower today. what's going to move bond yields
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between now and fed meeting next week and where is the bond market? how much gets cut. >> i think we're seeing it from the same song street the expectation fed will lower rates by 25 basis points next week the outlier would be 50 basis is points if that occurs. 2 to 10 spread between the two-year and ten-year maintained is 23 to 25 basis point move which means to me the market is given equal waiting to the expectations of a fed funds reduction and the long-term implication that inflation is well beneath the fed's goals and will likely stay that way for quite some time. ironically in between that would be trade, georisk, the ecb and the economy but right now it is a simple trade that has kept bonds pretty much where they've been the last, oh, 10 to 12 days in the trading
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>> let the earnings begin. an alert on td ameritrade and courtney reagan has result. >> for td ameritrade the earnings per share did come at $1.04 adjusted stronger than expected revenue at 1.49 billion. the street was looking for 1.47 billion another key headline, ceo tim hauck -- hockey is scheduled to leave. another headline out of td ameritrade the shares were higher by 1% 2% initially and putted back just a little bit on the results and the news of the ceo departure. sara, back over to you >> courtney, thank you don't miss our interview with td ameritrade ceo tim hockey tomorrow right here 3:00 p.m. on "closing bell. i guess they're giving some time, 2020 he's going to step down and the search is on for the successor. >> earlier if they find a replacement but it does seem as if -- i wouldn't say it's expected
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i would be interested to hear how he describes the move tomorrow but obviously it's, you know, methodical move. obviously creating a search and things like that seems like the market is not taking it too poorly obviously this is kind of a big platform company one of the big three in the industry and it really is going to mostly move according to client activity and asset gathering and all the rest. >> that stock up 0.8%. back to the other stories of the day. senator elizabeth warren calling out congress and regulators for not pay ago fence to what she considers warning signs of an economic crash in a blog post the democratic presidential candidate listed household debt, corporate debt and a manufacturing recession as red flags of the coming downturn what is your take on this, scott? there was some legitimate headline points with some perhaps exaggerated rhetoric around it. >> well, you know, wilfred this is, of course, the campaign season and anybody running for president is going to be looking
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for things and certainly you cannot argue about the debt levels out there you know, we're in a low interest world i don't think that's going to change any time soon someday it will and i think the debt situation will become much worse then because really, you know, for -- in our perspective i mean the long-term debt situation not just here in the states but globally, at some point it's going to be detrimental. is that five years away, ten years away, more i'm not really sure but i think as my time frame that we're trying to cover, let's say 12 to 18 months, we're not worried about that debt right now but certainly it's something to keep an eye on and it will be an issue at some point down the road >> i mean it certainly makes headlines for a politician who is running for president to warn of an economic crash. >> yeah. >> fear sells but some of the issues she raised, manufacturing sector in recession, an economy that this built on debt are isse
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we talk about every single day whether it leads to a crash or not, they are top of mind for wall street. >> without a doubt and i think arguably, she's betting that it's also top of mind for main street in other words, you have to find a way if you're going to be running against an incumbent to play against this notion that we have a very strong economy it's a long expansion, unemployment is very low so have to point out the weak spots and essentially i guess try to convey the idea that an expansion squandered we didn't necessarily make progress -- >> it doesn't work for everybody. doesn't work for people at the lower and middle income scale. >> remains to be seen whether folks on the absolute level is the way forward for the democrats next year as opposed to the focusing on the redistribution at some factors at play. >> much can happen in the economy and perceptions of the economy in a year but at some point people get locked into what they've decided the economy is. >> right. >> so you have to make your bets beforehand if you're a candidate. >> now, top semiconductor executives are meeting at the white house over the huawei ban,
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ylan mui has the details for us. ylan >> i can go with my first name, will, if it's okay we have seen several executives arrive here at the white house to talk about huawei micron, cisco, qualcomm, they're all here we're also told intel and broadcom were invited as well. and the white house is still holding out the possibility here that president trump could drop by this meeting. he said earlier today that he wants the u.s. to be the global leader in 5g and no one can compete with silicon valley. we also know he does like these sort of impromptu roundtable, guys so know the meeting started half an hour ago and as far as we can tell it's still going on so we'll bring you the latest when we have it. back over to you >> ylan, thank you sector, mike, took off like a rocket today. >> it did and really -- it's not clear to me it's keying off the huawei stuff it's almost as if the markets say we can't handicap this process, right, so we're trying to call the turn in the underlying cycle as opposed to
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how this is going to turn out. >> scott, do you like this sector >> we do we like technology typically semiconductors for old-timers like myself was always an early cycle performer but now they come and go and semiconductors pretty quickly, so, you know, is it the best technology sector? subindustry group? probably not but overall we still definitely like technology here and this huawei, you know, i'm no expert on huawei, but you can rest assured that this is, you know, the president could give some ground there chinese president xi could as well and so i think we'll continue to hear about this in terms of these very, very important trade negotiations that hopefully are going to start up here and get a little more serious >> i mean you mentioned early cycle indicators and people, you know, in the last, i don't know few months were looking at semiconductor as a tell of things deteriorating in terms of
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outlook and looked at transports that way and i mentioned small caps which did underperform and continue to do so. how do you read these sort of mixed signals? >> well, you know, i tell you, here's the way that we look at small caps when you're late in the cycle and things start to slow down, money flows to the biggest of the big cap stocks, you know, the oex, s&p 100 because they have better balance sheet, easier access to credit. they can buy back share, they have lots of products and that's totally different and they have good margins and that's totally different than, let's say, the russell 2000 a lot of companies don't make money. they have really lousy margins compared to the s&p 500. they tend to have a lot fewer products they don't have the ability to buy back shares nearly as easily and they don't have as good a balance sheet so for us when things slow down, that money tends to flow to those bigger names. now, small caps could outperform if you think there will be a complete trade meltdown, i think
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they would probably do better than or if u.s. economic growth actually did accelerate or at least the difference between international growth and u.s. growth really that spread wideninged, then i think there's some hope for small caps but that's unlikely to happen in our book and probably they'll underperform over the course of the rest of this cycle >> kevin, i just warranted to come back to the yield cut very quickly. if we did see the cut cut by 50 basis points would that successfully steepen or do you think the long end would come down with the short end? >> well, i think you'll have a steepening but probably not as much as if it would be just straight 25. i think that we're going to see obviously a gap lower in the short end of the curve probably unwind even further the six-month, ten-year relationship but i think there's two different stories and the story for the long end of the market continues to be this hedge or bet that inflation will not come
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back in the next year or so. the fed funds reduction of 00 would have a more dramatic effect >> shock and awe, guy. >> kevin. >> shock and awe >> 50 is shock and awe. >> thank you, guys >> all right, take care. >> thank you still ahead emerging markets have been badly lagging. the s&p 500 for years. up next, morgan stanley's investment management head of emerging markets tells us whether he sees opportunities. later we will debate will snap shares can keep surging up. they release quarterly results tomorrow [ alarm beeping ]
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whirlpool earnings are out >> the earnings per share came this at 401 adjusted versus the 371 that was the consensus estimate and the revenues came in with a beat here, 5.19 billion versus 5.03 billion that had been a big question because a lot of the growth they've seen in eps has been
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because of cost cutting measures and some restructuring they're still saying those strategies are paying off along with some moderating cost inflation, but cost inflation still a particular head wind along with unfavorable currency and talk about where things are looking good north america has delivered a strong performance they're expanding profit margins here, the sales were 2.9 billion compared to last year of 2.8 billion for the same quarter. and it looks like they're going to continue with stock repurchases here throughout 2019 again, the big headline coming out of this is that they're lifting their full year guidance, sara, stock doing great right now, up more than 5% in the extended trading? >> contessa, thank you continuing a strong run for whirlpool a reversal of where it had been last year. >> recently a strong run but still very much a disliked stock. nobody on the street really recommending it much it's ten times earnings.
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cyclical housing related so a lot of things that have been to some degree in the penalty box so seems like relief here if you can affirm guidance you trade at ten times earnings you'll find reason to get a lift. >> up 4.6% in after hours. it was a roller coaster day for the dow. bob pisani here to break down the moves and bertha coombs will do the same. let's start with you, bob. >> global industrials, will be reporting this week. mixed today but remember what happened to 3m in april. disastrous full year guidance much lower than expected stock dropped 25%. the whole sector got clobbered on those concerns. we'll see if they reverse that whirlpool good sign. i want to point out continuing carnage in the department stores, another new low for nordstrom's. down 40% decline for the year, macy oh kohl's, jcpenney down more than 20%. every day they move down more and some of the apparel makers not quite as much but we see
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ascena is down 80%, express down 52%. >> nasdaq outperforming the other major averages and bertha coombs with a look at the stocks that drove it higher. >> all about large cap chip names. 3% away from its april 24th all-time highs, quite a roller coaster ride the last 2 1/2 month, goldman upgrading today a new high for applied materials and land research or rather kla ten corps. among the losers today, netflix down for the eight the straight day continuing to get punished after disappointing numbers on earnings and new lows for small and midcap biotech names like united therapeutics and intra-september pharma along with weibo back to you. >> thank you news alert on boeing phil lebeau with details >> moody's is joining fitch in
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terms of changing the outlook for boeing earlier today fitch took its outlook, credit outlook from stable to negative and moody's doing the same thing and much like fitch moody's citing concerns regarding the 3 737 max. much like fitch earlier today, moody's is not changing, not changing boeing's credit rating. it is simply lowering the outlook from stable to negative, guys, back to you. >> okay, phil. another thing to keep an eye on on boeing, thank you now emerging markets underperforming u.s. equities so far this year with the eem up only 10% compared to the s&p 500 v 19% move higher. if you broaden it out to ten years the beginning of the recovery from the 2008 financial global crisis the divergence is more striking. what's behind the lag and where are the best students? joining us is the chief global strategist and head of emerging markets at morgan stanley. great to see you how are you doing? >> all right good to be back.
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thanks >> so last came on with us in april and were bullish on it then what's de delayed that call playing out? >> no, this terms of what i had said back then was that this is the worst decade for emerging market equities. nearly a century it geese back and my basic point, what happens one day can really repeat itself in the subsequent decade so last decade the exact opposite happened the charts showing here how emerging markets have done nothing this decade and u.s. tripled in value the exact same chart could be shown for emerging markets versus the u.s. last decade with the roles completely reversed. america's decade the only thing that's worked has been investing in america and investing in obviously large cap tech in america. everything else, europe, japan, emerging markets has been
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pulverized in terms of relative performance compared to the u.s. so my basic thesis is that in the coming decade we are likely to see a role reversal and that america will peak and some of these international markets will do much better as has been the norm for the last 100 years. they've been given a powerful train of one decade. it doesn't repeat itself in the subsequent decade because trains get stretched by the end of the decade and valuations which get very stretched compared to the rest of the world and the america stock market relative to the rest of world is trading at mul multidecade highs in terms of price terms and valuation terms. >> so i mean the valuation argument is there, ruch. r, but what's the actual trigger? >> you have to look back as to why did emerging markets und underperform this decade we said that they would underperform this decade at the beginning because expectations were far too high. in terms of economic growth
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rate, the entire narrative was how the bricks would take over the world on how these countries could keep growing at 7%, 8%, 9% from russia to india to china to all these nations. what's happened is we've had a very major expectations reset and the excesses of the last decade with so much debt was taken on in many of these countries, a lot of the excesses have been cleaned up this is very much a cleanup process we have been under and i think that come the following decade, you will begin to reap the rewards of this cleanup that's happened in this decade >> ruchir, does a rate cut help? >> at the margin, yeah but i think that the fed followed an easy money policy for much of this decade so i think that this rate cut sort of keeps us very glued to the short term but the longer term picture really has to be that when do the fundamentals of emerging markets improve? when do the current account deficits get more manageable when do the debt situation gets
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more manageable? i think we're getting to that point so that's probably more important. regarding the fed's policy, really as long as this bull market continues in its current -- i think the u.s. continues to outperform because it doesn't change so late in a bull market. what i'm looking for is a situation analogous to '98 to 2002 when the u.s. kept outperforming but began to see a turn once the u.s. peaked and when the new bull market began we saw this massive outperformance for emerging markets. it won't repeat itself in an identical way but roughly the playbook i have in behind. >> i was going to say, ruchir what, do you say to those who say that period was really a credit in commodities boom altogether that may not repeat again. >> that's true, the magnitude of what we saw last decade is very hard to imagine. so this could be something which is very different in nature. but it's still something which
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points to greater outperformance look at the global economy to date emerging markets at about 35% of global economic output their share in the equity market universe is just 12% that's a massive disconnect you have here. in the united states it's pretty much the opposite, the share of the u.s. economy in the world economy today is about 25% the share of the u.s. in world economic -- in the world global stock market capitalization is 55%. so 30 percentage point gap in terms of economy versus the market and the exact reverse in emerging markets, so i think that putting more capital to work in emerging markets will be followed the next five to ten years but, yeah, if you had me on the show again three months from now just like you had in april, will that trend play itself out i'm not sure i'm not that confident about that because these trades take a while to rye verse themself.
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at the beginning of this decade i couldn't get enough people to sort of be skeptical about commodities because we believed that commodities was in a massive super cycle and would last forever thee countries would keep growing forever and here we are and they're almost see as a repugnant class. tech is almost all we speak when role reversals happen but take a while to play themselves out. >> ruchir, whatever happens, we will see new a couple of months' time. >> great thanks for that. >> ruchir sharma of morgan stanley. tech heavyweight, microsoft, app, facebook and amazon currently make up 13% of the s&p 500's weighting and we will look at whether that should be a concern for investors. and the massive week for earnings continues tomorrow featuring results from coca-cola, visa, chipotle, kimberly-clark and more. longelut what to expect later on "csi bl.
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let's send it over to mike santoli for the final dashboard theme. housing? >> walls, buildings. it was a little flimsy today, i grant that but this one i think is interesting. betting the house, so there's a report in "the wall street journal" pointing out as many have that the biggest four stocks in the s&p 500 account now for an outsized amount of the gains this year but i went back into history. is this really unusual to have the biggest four companies in
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the market represent a large chunk of the s&p 500 the answer will be no. so 13% right now if you go back to 1960, very, very concentrated with huge industrial companies we'll get to the names in a little bit and dip down. been below in 1990 it was not shown but 9% but there were types when market cap was more spread out. the fact we're at 13% doesn't seem that extraordinary in terms of large companies running things let's look at the actual companies that o are in there. of course, right now we can get to in a second, 1960, at&t, recurser of exxon, standard oil of new jersey known as esso, gm and dupont and 1980. very oil heavy as can you see, exxon, standard oil of indiana which became amoco which was brought by british petroleum and then at&t and ibm so clearly this happened before now look at the latest two decades, 2000, interestingly, because this is a year end analysis, it's not technology,
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ge ge, exxon, pfizer and today app, amazon, microsoft, facebook. you could make the argument we're all pretty much in one industry and that might be a difference if you consider those to be all the same industry. i don't think it's a matter of saying there's something extraordinary about the current setup. >> exxon interestingly was the one that had a good 50-year presence up there. the other point, this is the s&p 500, so 13% is still pretty significant of 500 companies. >> without a doubt. >> you look at the other big indices whether the dows at -- the contakak courant. >> without a doubt i mean 13 so a little bit more than 1/8 of the market cap in the indexes for companies but i think the lesson is that's been the way of markets for a long
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period of time winner take all companies that rise to the top and become the blue chips >> yeah, i think it's the industry concentration that is a little more worrisome than usual. >> you could argue they're highly valued especially if you look at something like amazon at this point in terms of how aggressively they are now valued. >> can't believe it was citi as well in 2000 that's kind of crazy. time for a news update with sue. >> thanks so much. here's what's happening alt this hour, everyone secretary of state mike pompeo defending president trump's america first foreign policy this in a speech at a vfw gathering in orlando, florida. >> president trump is unafraid he's unafraid to try to do diplomatic tactics where the old ones weren't getting the outcomes america needs and deserves you have seen this you've seen this in north korea where we found appeasement wasn't working and neither did neglect. >> hundreds of nurses at the university of chicago's medical
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center rallied this morning over what they are calling unsafe working conditions they say it's making it difficult to properly care for patients but the university called the claims a negotiating tactic as they discuss a new contract and soccer star cristiano ronaldo will not face criminal charges after a woman accused him of raining him at a las vegas strain resort in 2009. the prosecutor said in a statement that the sexual assault claims cannot be proven beyond a reasonable doubt. you are up to date that's the news update this hour sara, i'll send it back downtown to you > thank you. up next two analysts debate whether investors should be buying or selling shares of snap ahead of the social media company's earnings tomorrow and pretty tremendous run-up so far this year.
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welcome back here's a quick check of today's post market earnings whirlpool beat on eps and revenue and also raised guidance and did jump 5% in after-hours trade higher it's now trading lower by around 1% more details on that
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td ameritrade beat on both lines as well that dock is flat after after hour-you are trading and tim hockey will leave in february 2020. i'll join us tomorrow on "closing bell" for a first on cnbc interview >> looking ahead to tomorrow, nap is set to report results after the bell the stock up more than 150% so far this year. snap's run, has it run its course sr. there more room to grow >> with us is ethan kerzwhile. brent, how do you even tell what expectations are with a run-up like this into key tests tomorrow of earnings >> it's the biggest return of the year it definitely -- expectations are very big hedge funds have been playing at the long only. community really hasn't jumped in yet so there's definitely dry gunpowder on the sidelines for new money to come into the stock still at this level. so we think, you know, going
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forward the expectations are that they are going to add 6 million to 8 million new net users sequentialally and also i think to give a better profile around break even, talk about many of the new management changes that have gone through so there's a lot to like fundamentally in terms of what's happening here but as you mentioned, stock is up 150 plus percent and trades close to ten times revenue which would put it definitely at the higher end of the valuation spectrum we simply like other names better at current level. >> ethan, you disagree and think the positive year to date momentum can continue. >> i think what we've seen is the tale of two snaps really, the first year they went public earlier as a public company then most companies do. first year was rocky and then they've turned it around and stabilized ralph northam growth or some of the revenue declines they've had and focused on monetization and product development and those are the things i think will carry them into continued really positive
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momentum >> yeah, i mean, brent, what examples would you point to? we've talked a little bit and made light of the gender face swap which is a big hit but as it relates to the improved profitability and metrics and better execution >> you know, we've -- there's numerous things. they moved headquarters and gone from basically a start-up to a grown-up office if you will. secondarily and stabilized the management steam there was a revolving door a year ago and have all the positions filled and hired a chief accounting officer they've made improvements to the products they've gotten the android release out and pricing seems to be getting better. they indicated that pricing has been very low to bring more advertisers into the platform. we think over time they could actually raise prices. and then i just simply look at my teenagers in my house and all their friends and we interview teenagers, you know, as part of our due diligence and those are
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kids are not leaving the platform they're addicted to this -- to the point where i actually have to rip the phone away from many of the kids i'm around so they're super addicted to this platform and will continue to grow up with it and as snap rolls out more video and content, there's a tremendous opportunity. so we think the stock can grow higher i suss jim -- simply believe there are new names we like better >> what do you take of the success of nowhere of ticktock it's not facebook or the ole platforms that snapchat couldn't compete with it's something that came from a different direction and got a lot of users. >> it's a tremendous story it was like one of the most biggest surprises in the social space of the year that a chinese company could release a product like that and captivate an audience seemingly saturated already. what it shows is as brent said
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there is just tremendous appetite for social products on our mobile phones, specifically the millennial but goes much more bow yopdz that but that's where tiktok has been most -- video content of entertaining clips like the things you see with snapchat stories and tiktok, instagram, some of their recent product, there's tons of appetite for that. youtube and the app story and the tremendous amount of games that you see and all the time that millennials and other folks are putting into those products, there's just a wealth -- we're not anywhere near fully saturated in terms of social time and that will tie into snap, some of what we're talking about in the current question is, can they continue to take that time and saturate and further and further saturate this particular audience they're releasing games and a platform product those will have tremendous effects as well in terms of engaging that audience even
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further. >> brent thill and ian kerzweil. has snap peeked, your teenage girl there is they're not on snap for some reason we drew the line tiktok. >> they're not allowed >> yes, they haven't been allowed. they're not allowed because it's cool >> up next, oil prices on deck going higher after growing concerns surrounding iran the big money impact straight ahead. d castillo. did you know that americans who bought gold in the year 2005 quadrupled their money by 2012? even now, experts all across america predict the real gold rush is just beginning. - [announcer] us money reserve is the only precious metals company led by a former director of the united states mint, and as one of the largest us gold coin distributors in the country, us money reserve has proudly served hundreds of thousands of clients worldwide. there may have never been a better time to start diversifying your assets with physical gold and silver, and right now, it's easy to get started.
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a quick update for you on that chip executive meeting. the meeting of semiconductor ceos president trump has joined the meeting and we'll but you any other headlines as soon as we get them ceos of all the semiconductor name, a lot of them most of them having too do with doing business with huawei which has been scarce in detail since the latest between u.s. and china. >> oil prices getting higher as global tensions in iran continue to ramp up it claims it captured 17 u.s. alleged spies sentencing some of them to death. though president trump tweeting that the report is false this comes after the iranian government released a video of its capture of a british tanker over the weekend joining us via phone is tom kloza, and, tom, you could frame it the other way to say oil prices only up 0.9% today and down, of course, still quarter
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to date and that it's relatively surprising we haven't seen a bigger bid given this geopolitical tension how much will the geopolitical tensions need to escalate to see oil price jumps significantly. >> i think it is a whimper as opposed to a spirited rally and i think you probably would have to see iran seize a u.s. ship and have some actual sort of firing of ordnance to really stir things up the fact of the matter is, this occurred from, let's say, 2011 through 2014, it would have been worth four or five, $6 a barrel movement but everyone kind of has it in their mind that oil prices may go up $5 or $6 or so in the year there but 2020 is already in focus and 2020 is going to be a very troubling year for oil prices, probably lower than what we've seen recently >> so i guess this whole bet and the whoa difference lately is that u.s. can ramp up production or has been already and it's
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just a whole different production picture how much slack can u.s. producers pick up, tom >> they can pick up quite a bit and you have to remember that the last time you had all of these incidents in the persian gulf or in the strait of hormuz was against the backdrop of probably 5 or 6 million barrels a day of u.s. production now we're at maybe 12.3 and probably get to 13 you know, the rig counts are very, very misleading. doing high grading and getting much more out of the rigs and we also have some offshore projects that are coming back online. so, you know, i said this earlier. i think that what happens in the gulf of mexico is going to have more to do with what we pay this summer here in north america than what happens in the gulf of oman or the persian gulf >> tom kloza, thanks for joining us >> thanks, wilfred. taxing the wealthy democratic candidates all pu pushing to raise one of the stmo important taxes for investors. we'll discuss.
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>> democratic candidates are pushing for different tax hikes on the rich but all united on one front. that's raising capital gains tax. robert frank has more. >> joe biden, bernie sanders, cory booker, beto o'rourke and amy klobuchar all calling for a higher rate on capital gains what would the impact be right now rate on capital gains is 20% rate on income tax 30% many candidates want those rates
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to be equal. the two rates were equal in 1987 investors rushed to sell before that tax then revenues fell by 50% in 1987 most of you show no connection between capital gain taxes and economy and market but 70% of capital gains go to top 1% you see why this is popular for democrats. >> makes sense capital gains tax is lower than income tax when people take risk with their capital. it's different when it's a back seat tag a long type of investment >> there's an argument that because you can also write off your losses from capital gains that you're not really taking entire risk with that capital and so, therefore, you don't need that incentive. plus there's so much capital in the world right now. do you really need a push from taxpayers to subsidize investment >> on a practical level that's different when you first
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initiated capital gains. >> in the early 1900s it was tough to find capital to get people to invest in thing. it's a different picture a lot of capital is foreign. >> how much revenue would it raise? >> that's the big debate right now the cost to the federal government is about $120 billion a year that assumes that if you raise capital gains you would capture all that and of course we know there's some level at which people would not sell their investments. but the estimates are around $100 billion a year you would gain depending on what that rate is >> thanks very much. i'm grabbing it from here. after the break we'll have your wall street look ahead, all the key things every investor needs to have on their radar when "closing bell" comes right back
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dear tech, let's talk. we have a pretty good relationship. you've done a lot of good for the world. but i feel like you have the potential to do so much more. can we build ai without bias? how do we bake security into everything we do? we need tech that helps people understand each other. that understands my business. we've got some work to do. and we need your help. we need your support. let's expect more from technology. let's put smart to work. ♪ ♪
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♪ can i get some help. watch his head. ♪ i'm so happy. ♪ whatever they went through, they went through together. welcome guys.
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life well planned. see what a raymond james financial advisor can do for you. your wall street look ahead. another busy earnings day tomorrow coca-cola, kimberly-clark, visa and chipotle all set to report and big political changes are coming to the uk a preview of coke and kimberly-clark >> the idea for coke and kimberly-clark is boring is hot
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again. both kimberly and coke have shown under new leadership they can prove they have faster more innovative growth and profit stories. coca-cola stairs underperformed as the company faces more global head winds watch that growth number it was high last quarter, 5% pepsi dazzled with 4%. we'll see if coca-cola can match that look outside the core for updates on costco coffee products, body armour, sparkling water. this is where the growth is. basically outside of the core coke and diet coke brands. they are doing the heavy-lifting. pricing versus volume. pricing has been the key that's where the growth is smaller packages getting more out of different packages instead of the flat volume that coke has been seeing for kimberly-clark, same story higher prices driving growth in huggies diapers and toilet paper and other basic products can it turn that around like
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rival pmg? growth will be key will kimberly raise guidance from 2% sales growth pmg is killing it right now, growing more than double that and really on top of its game. for kimberly cost cuts, how much savings can the new ceo drive from productivity and cost cuts. one reason the stock has been celebrated on wall street. been quite a run of household products done even better than other consumer staples which has done pretty well. >> those results coming tomorrow visa also set to post results tomorrow and we have a preview >> reporter: visa is priced for perfection up more than 35% this year currently trading near all time high which it hit last week. any short fall and you could see the stock correct. investors want to hear more what facebook's libra may mean for payment processors they could be disrupted by the
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crypto currency or benefit from it as their charter members of the libra association. the street is expecting earnings per share of $1.32 on revenue of 7.5 million. a report tomorrow kay rogers with a preview >> reporter: the stock has been on a tear up over 70% year-to-date best performer in the restaurant space and up over 130% since brian nicole took over as ceo. analysts will be looking for digital growth it represents 15% of total sales and chipotle will take off another focus is same store sales. chipotle saw growth last quarter. analysts want to see if that momentum continues >> thanks. tomorrow shaping up to be a big day for uk politics. of course, you can fill us in. >> the bear markets and the polls suggest boris johnson is
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all but certain to lead the conservative party and become uk's 77th prime minister the announcement due at 6:45 a.m. eastern time. if we look at year-to-date chart of the british pound it tells the full story which is sliding throughout the course of the year still a lot of questions for bo boris johnson. so the chances therefore of some kind of vote or the election or second referendum after this summer significant we'll get confirmation who the next prime minister is tomorrow morning. >> not really a surprise >> nobody is surprised it's likely priced in and shake out will be come september when we see if there's another vote of some form but certainly year-to-date >> do you think we'll hear comments as far as characterizing his approach. >> nothing more than what has come out up to this point. the swing vote would be if he
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faced a lack of confidence vote. so focus is end of september he'll pick his cabinet and his finance ministers. >> one more thing you should get excited about. imf out with its world economic outlook. it has a forecast. last time it was in april. they've been downgrading global growth big headline >> lots to come tomorrow we're out of time now foreclosing bell >> "fast money" begins right now. >> "fast money" begins right now. at the nasdaq, new york city's times square traders on the desk. tax front and center for your money as we gear up for a huge week of earns. we'll break down the key names big tech executives wrapping up a big meeting at the white house right now on huawei. we'll take you live to washington for the latest. whirlpool whiplash the stock seeing a whiplash. what analysts are

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