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on casino stocks I got an interesting note today from Morgan Stanley analyst from the gaming conference in Las Vegas talking about the rising rates and that industry insiders are arguing the rates actually could be good for gaming because retirees get more disposable income with the rising rates on their fixed incomes and they may choose to go to casinos and lay down more money think about consumer discretionary and if you have people with a little more disposable income at their benefit who might benefit in those case those seniors typically carry lower debts so that in other words they don't have a lot of big open credit card balances or floating rate debt or whatever I can't remember we did a segment last week I forget was a day you were here but I know you were we just we did a segment on cash we did a segment on CNN for that that is probably the first time in ten years we've done a segment for so long we heard Jim Cramer talking today about how leading into in 1987 how he was all in cash again - it's something that it's new to me to hear the repeating bell of cash cash cash but something to consider yep some key levels that were watching going into this close 28:22 on the S&P 500 that's a 100 day moving average a close below that could indicate a break in momentum right now we are below that but we're sticking close to that line and we'll watch that line very very carefully as we door are down more than 2% on that index and thank you for watching Power Lunch a very busy closing hour or of closing bell starts right now [Music] that it does Tyler thank you very much good afternoon welcome to the closing bell I'm Wilford cross I'm Sara Eisen in for Kelly Evans and it's been a wild day on Wall Street as you all well know let's have a look in and what the indices are doing with just an hour left off trade down exactly two percent on the Dow in terms of points that's down 527 the lower the session was down 569 the high was up 11 it feels like a long time ago early this morning SPS down just over 2% Nasdaq down over two and a half percent some brutal declines for stocks what's interesting is the cross currents right now have to look at bonds we have to look at the dollar as well take a look at the 10-year Treasury yield this has been a huge source of angst for the stock market lately 3 22 so hovering right around that 11-year high when it comes to bond yield you're seeing it across the curve the 2-year shooting up to a ten-year high the 30-year also multi-year highs we've been a little bit higher earlier in the session as you can see but the elevation of the bond yields also wanted to point out the u.s. dollar which is weaker today it's interesting that bonds the dollar and stocks are all selling off together usually stocks sell off in a big way 500 points down and you rush into safety like the dollar or the safe haven Treasury so a little bit of a different correlation in a different feel which could suggest not an out loud panic but could also be a redefining of what's safe in this kind of environment the move in yields today those small relative mean yes we're hitting those sort of records ten-year high typed headlines but the move small over the last couple days compared to that self in stocks which is certainly the most pronounced day down but not getting up not getting a reprieve and that could be part of the problem here we've got a lot to talk about this hour we'll talk about the tech drop that is what is dragging this market down alpha-1 capitals Dan Niles will be joining us what he says is the biggest threat to the sector as Melissa just 20 percent off the highs for Netflix ten percent off the highs for Amazon and is the sell-off just beginning or the start of a bigger pull back we're gonna talk to Allianz chief economic adviser Mohamed el-erian also during the show who has been relatively upbeat about growth in recently submitted to blooming right right in the global part exactly so we look forward to speaking to him and all of our guests but first let's get to our reporters following the market action Bertha Coombs is enter Nasdaq with what's driving the drop in tech and papasan is here with the key things investors need to watch ahead of earnings season but let's start with you that's precisely the issue here we are ahead of earnings season so you're not really gonna get any companies coming and rushing out and giving you terribly good news or bucking the trend the feeling that companies aren't going to be in there buying their stocks ahead of earnings either so that is part of the issue what we are seeing is much larger than normal volume in tech cells which tells you that there is more conviction in this sell-off today and it's being led particularly by the chip sector which has now down five days in a row it is off about 15% from highs and seeing the words daily decline for this chip sector since June 25th which was also when we saw that big downdraft on the S&P 500 among the big volume losers today the big caps that are dragging things lower the usual suspects are there Netflix Amazon as well as Microsoft these have all been big winners for the most part if you take a look at Netflix it's still up 73 percent year-to-date even with this big decline that we've seen of late the big push back different story for Facebook not trading in this high volume as some of those others but Facebook is one of those fan names that was down early with all of the issues about privacy and it is now down about 30 percent from its high and down 12 percent year-to-date while the others have held on to gains some of the stocks that are actually bucking the trend today some of the gainers are few and far between only about 10 percent of the Nasdaq 100 dollar tree and a number of retailers today are getting a little bit of love but some of them like X ray are really just bouncing off of new lows so not a whole lot of positive movement here to be found back to you but thanks very much for that now will earning season be a catalyst to turn the market Rambabu sunny takes a look at that hey beau hey willful we kick off on Friday covering your sector which your banks but part of the problem that the markets are having and while we're down today partly is that it's a much more complicated picture for earning season than it was even just three and certainly six months ago let's run down some of the issues number one and most importantly we're dealing with higher rates but this higher costs also we've talked about higher raw material cause Amazon raising wages we you're gonna hear about higher wage costs perhaps in 2019 and they're trying to figure that out we've also got weaker foreign currencies that may be impacting some big multinational companies we're gonna hear about that of course we've been talking about tariffs and there's a prospects of weaker demand from China we've heard that in some of these sectors like automotive all over all because of this it's a different investment world than it was even six months ago and certainly more than a few years ago so in the old world we had low growth and low yield and in that what environment you bought growth at any cost and you bought technology stocks now it's different we're getting higher growth and we're getting higher yield technology's a little out of fashion but what's in fashion well Treasuries are starting to look a little more attractive again stocks that's a big reason the markets had a hiccup in the last week or so and is value starting to win over growth it's an old story we've talked about it for ages but there are some signs that this story is getting a little bit stickier for example let me show you what the market leaders have been we've been talking about all of these stocks that are off their 52-week highs how many are 20% often that's true there's some technology stocks and industrials 20% off but the market leaders are still holding up healthcare and utilities energy real estate consumer staples they're only three four five percent well up there 52-week highs not this highs at the start of the year you'll notice something about this these tend to be defensive names and they tend to be value oriented plays in other words there's some signs that this story about value is getting a little more sticky bottom line here we're gonna hear a very complicated story about earnings starting on Friday back to you and Bob you know while we're still waiting on the Biggie's including the banks as you mentioned what we've gotten so far hasn't been that rosy I'm thinking back to Pepsi a few weeks ago warning of higher freight costs warning of the impact of a strong dollar on profits PPG yes they fast and all I mean these are names we don't really talk about that much but that's a you know industrial supplier and all of them were warning about tariffs and rising costs yeah not so great that's right and micron also talked about the impact of tariffs didn't put a particularly a number on it and that's been part of the problem nobody's been able to actually nail down an impact that we're having I think you are going to hear about all those issues we talked a little bit more and I think that's what the markets doing it's in the process of correcting for that uncertainty if you understand that you can see it remember something though the market the overall economy still very very strong and I think the important thing for people to bear in mind is the revenue growth is going to be very very high so when you have two or three percent increases in costs and your revenues are going up seven or eight percent well Sarah you've got a lot of room to hold your margins up and I think that's gonna be one of the things that's going to really help the market revenue growth still strong back to you yeah look we'll see what margins and guidance look like Bob thank you joining now our closing bell exchange to discuss more on today's big market sell-off we've got Chris Cordero here from region Atlantic Tony Chris NZ from pemko matthew chess locke from virtue financial and rick santelli from the CME Group in Chicago Tony this move in bond yields what's the primary driver and does it continue well the gray trade reversal we've seen from 2018 is clear proof that some cyclic a letís bring work back to the US economy and the US financial markets by cyclic allottee we would mean of course some of these late cycle dynamics at Bob Pisani just spoke to that leads across pressures and a breakdown in the correlation between assets it's not as easy to protect equities against risk and simply using bonds right now but we would suggest though that most most of most of the rate rise that's likely to be seen has been seen already that the so-called new neutral for global policy race is still in place in other words we're likely to see low policy rates stay in place in Europe Japan and even the United States and but what will happen over the next year the final point is there'll be a decision point from bond investors where they'll have to decide what we write about this idea of a 2 and 3/4 of funds rate for the N the feds rate hike cycle the market decides it's wrong and decides on a three or three and a quarter percent level yields will move concomitant Li but they're already in a zone to suggest that three three and a quarter percent rate could be handled a year from now Matt what's everyone been saying on the floor I mean the rate hasn't sword itself today it's been rising quite something in recent weeks why today we often than two percent well I think it's just a perpetuation of things that we've seen this is not a trading opportunity at least from our standpoint yet I don't see anyone here rushing to buy equities I think we're waiting for a little bit more of a pullback but we're trying to see the other cross currents that are going on with this market you're not seeing anyone rush to goal this may be a safety play or utilities so this market still has a little bit of room to the downside yet before we start getting really and started buying it S&P and Dow down three and a half percent from their recent highs Nasdaq is down about six and a half 77236 what you need to see - then stop buying again I mean look what happened look what happened in in China and things when we started talking about this trade tariffs or you know China really got slammed we really didn't are we far behind so we needed confirmation of where we stand at that point and I don't still think we see yeah we don't see that crescendo to the sell side we want to see that volume pick up and really get us a little bit lower it's gonna be painful maybe in the short term but it provides a buying opportunity Chris is it a buying opportunity you are you taking this opportunity to buy are you sitting it out no I think this is a buying opportunity especially if you look towards value stocks and because in the end when when all is said and done profits relative to price is what matters and so that's what we're starting to see in this market right now is it is it valuations and profits are what's mattering and that's all we should matter to a long-term investor Rick you're like alphabet for that reason like alpha value I actually like Intel especially today you look at that that's easy math to do they're selling at 11 PE that gives you about a nine percent earnings yield that's why you can see the value of having profits they just need to grow a little bit and you're looking at a double-digit return Rick when you consider the data that we had this morning does it justify these sell-off inequities that we've seen today in your eyes and factor it in with the auctions and action we're seeing in the bond market no I don't think the PPI did is responsible for this let's put this in perspective on the interest rate side as I look up at the yields twos threes 5/7 x and 30s through all basically exactly where they were on Friday we didn't see these kind of sell-off activities to the extent to Friday that we are today I think what's going on is of a big macro liquidation part to maybe even part three and it's simple as to why Jack Perugian talked about it today imagine if you're a Chinese investor a European investor or a Japanese investor okay your economies have bad fundamentals Europe and Japan have been a negative interest rates for years big institutions and investors if they buy into those markets over time they go bankrupt so what do they do they come here we've talked about divergence how does divergence happen they look at their own markets there's no opportunity they come here there's a problem when you have great investments here you skew it there's your divergence but you also need to convert okay if you're a European investor you need to convert that stream of income and your you dollar denominated into euros if you're Japanese you converted into yen the problem is that the banking systems in these countries especially here it's kind of weak and these big hedge swaps to hedge those swap flows is almost at full capacity it's been that way for a while don't think be is the bank of international standards has written a great length about this so I guess what I'm saying is there's pressures in the system that could cause liquidation of positions in the US and the backstory there is they could also be in addition to the Fed and the economics of our economy pushing rates just a little bit higher as well a good explanation and sort of the correlation back in this market Tony when you see and we're now looking at a six hundred point decline on the Dow Jones Industrial Average a move like this in stocks usually there's a flight to the safety into the bond market into the dollar neither are happening today what does that tell you it tells you something about where we are in the economic cycle it's late cycle dynamic where there is this dispersion between assets early in the cycle two thousand eleven twelve thirteen fourteen it's easy to buy something and simply pick up beta to credit in equities and win because one needn't worry about interest rates that isn't as easy now so one should be thinking when investing more about risk factor investing in other words there's some equities that have interest rate risk in them and some bonds that have equity risk in them and investors should also be thinking about liquidity risk and volatility risk so think taking a risk factor approach now is very important because it's going to be dispersion in a late cycle we're at session lows I should just mention down 633 points on the Dow just very quickly Chris and Matt Chris you mentioned you you like Intel what don't you like what are you avoiding well I think well I think what you need to avoid there are high priced tech stocks you know so you need to avoid the Amazon's of the world you've got it you've got a question in the Netflix where they're really just trading on news of potential earnings I want to see real profits and that's and that's what I think is really going to matter you know the other thing too I think that we're missing here is inflation inflation all the things that Bob mentioned early on this report are inflationary you look at the trade and tariffs that's going to cause inflation that's putting upward pressure on rates and I think that's why people aren't moving into bonds right now is because they're afraid rates are going to move up and they can get hurt I'm not just quickly I don't know going for gung-ho purchases in the moment if there was a sector or stock that you would buy now what would it be I'm gonna I'm very cautious right now really I think we're gonna get some further discounts here you start to look at oil you know people would annoy got to 65 everyone said it's going lower it's gonna break down now it goes 75 so they think it's gonna break out again now roll middle of the range that's an interesting sector now I think if we get some further sell-off you know you you might start to see people plow into oil okay and the stock sell-off is picking up steam urine to the clothes Welford as you mentioned now every sector in the SMP has been negative including utilities which were hire pretty much all day tech by far the biggest loser guys thanks all Chris Cordero 2015 Z man chance Locke and Google Rick Santelli fascinating exchange we've got 45 minutes left to trade and we're near the session lows as Sarah mentioned let's send it over to for a market flash on the transports hey Dom alright so Wilfred Sarah as we talk about what's happening with the market downside the transportation stocks are notable downside relative underperformers to the rest of the overall market the Dow Jones transportation in X now it off by just around three and a half percent as we head into this closing bell in the next 45 minutes or so far outpacing the declines in the broader market for the Dow or the S&P 500 if you take a look within the transportation stocks there are the notable parts that are really dragging things down first of all you've got what's happening with the railroad stocks a number of those railroad stocks moving to the downside and among the worst performers in the index CSX by the way on the railroad side having its worst day so far of the year that's one name to watch also take a look at what's happening with the airline stocks because they even with lower oil prices to some degree over the course of the past day or so are not finding any kind of a bid they're caught up in this transportation downdraft as well railroads and airlines two of the key parts here I would also point out Wilfred Sarah that as we take a look at the ETF one of the key ETFs that tracks it the iShares transportation average ETF this is the ticker iyt it is now traded more than double its average daily volume today also worth noting that the Dow Jones transportation index has now fallen below its 200-day moving average or its longer-term trend line it's the first time it's happened since back in July so as we take a look at the overall picture for the market and the narrative that's developing there are certain key hot industries and sectors transportation stocks have been one of the real standouts towards parts of this bull run higher it is now leaving the declines it will be something we are going to watch for sure in the closing parts of this trading session to see whether or not they close at the lowest Wilfred daaamn great stuff thanks very much and we'll also look forward to those Airlines from which reports of course tomorrow let's dive into the Dow which briefly was down six hundred and thirty six hundred forty points was the lower the session a few minutes ago is back down now to down six hundred points still of course a significant sell-off there are the Dow losses Nike down six percent bowing down the four percent of course heavily influenced by the China trade for his Microsoft even down significantly 3.9 percent haven't got an upgrade earlier in the week there's really no place to hide at the moment let's go out to saris on the floor with Mike Santoli looking at Tiffany which is seeing an even bigger plunge today Sarah yeah no shortage of losers out there today Wilfred but we came down to the post where Tiffany trades because it is down nine percent and it is part of a broader consumer discretionary especially luxury goods sector sell-off right now this comes after overnight and there was a catalyst here LVMH obviously huge luxury conglomerate in Europe warned that China was being stricter with its checks of travelers back and forth of the border looking into the luggage of the luxury goods it's such an important luxury goods market and people are trying to figure out what China is going to do to fight back in the trade war so I think it sends some shivers down the spine of the investor is an all luxury player exactly and I think it also shows you the sensitivities of investors to exactly those issues so Asia exposure was a big bullish talking point for any company a while back now it's a net negative and the concerns about you know just seeing exactly what the friction is going to be affecting companies with regard to Chinese countermeasures all these things come to a head with try with Tiffany which also by the way it's still up here today we have a nine and a half percent drop today it still up seven percent so you have a lot of kind of profits built up in a lot of these consumer names people that the economy was great and then you're getting undercut right here I mean I can't believe I'm mentioning for the second time this this our patent all you know fastener distributors China was an issue and it dominated the conference call today and and there is some anxiety out there about this global supply chain and just what China is going to due to disrupt literally the nuts and bolts of the global economy that's where fashion all does among many other things and yesterday PPG right so yesterday was kind of an industrial coatings business that's why I do think that there's a kind of an accumulation of concern about what it means for not just third quarter earnings but just what it looks like going ahead when you do have a little bit of you know China and the u.s. kind of going their separate ways on trade right and pulling different sort of weapons right and then in the fight I mean we may not have as many imports from China have more imports to tax cut tariffs on from China and they do but they have other ways of making it painful for our economy is much more insulated from trade but the S&P 500 is not particularly insulated from trades because that shows you two different ways the stock market is not directly mirroring the US economy never has all right with that Tiffani down almost 10 percent Wilfred back over to you okay guys thanks very much for that you can see from that Dow chart we are right near the session lows 2.4 percent for the Dow something similar for the S&P the now stacks down more than three percent 3.1 7% to be precise with 40 minutes less left of trade let's discuss this a bit further and joining us now is Kevin O'Leary chairman and o and o shares ETFs and in particular Kevin want to talk about dividend stocks you talk about them in the past that they've got strong cash flows that they are an area of the market you generally like do you like them in particular in this current environment of a big sell-off I like them a lot in this current environment in fact they're starting to outperform because at the end of the day when you start thinking about the success we had in technology for such a long run there the infinite long asset think they they pay no dividends there's training and extremely high Peas they're not necessarily bad stocks but they tend to really have violent Corrections as they are right now on the other hand you take a really boring balance sheet like a chevron or a Pfizer or an AT&T boring as hell extremely strong cash flows pay out a significant dividend yield significantly higher than the S&P SCC yield so you can get almost 100 basis points more with these stocks and they're the ones I tend to favor in times like this because they pay you to wait and you don't know when the bottom is going to be in fact that's on days like today that's what I buy now you know I love big indexes I designed my own today is a know us a day that's an index which is chock full of boring as hell monster balance sheet big succulent cash flow companies that tended to be out of favor for the last couple of years and all of a sudden people love cash flow again and so do I it makes me feel warm and fuzzy every quarter when I get that dividend Kevin no I don't have ever seen you wear anything but all black and you've got a red hankerchief garroted out and if that's in honor of the red we're seeing across the screens diving into this point I am so glad that you saw that that you took notice of that because I respect your look all the time I'm trying to match this red band on this Daytona which has a black element to it to my suit I'm so into this fashionista stuff these days help me help me I will I think you know not you shouldn't just launch an index but it may be a very fashion brand I think it would do very well I'd be your first customer Kevin back to the the call on a yield stock suit in the way you're explaining it there is it because it pays you whilst it waits but you do expect the prices to fall of these stocks along with everything else or is it because the company that tend to have higher yields have strong cash flows backing them up no it's all about the balance sheet and the quality of the balance sheet because what happens to meet with these stocks when you have violent Corrections as we're having now remember with it's been a long time since we've started to have violent Corrections when you see stocks down 10% in one day or sectors down three and four and five percent it's been years before we've really seen that and now we're starting to have it and the reason I love stocks that have really strong balance sheets with strong cash flows and distributions to them is they tend to correct less so in a mark to market basis when I'm looking at my overall portfolio these are the anchor positions these are the ones that tend to help me outperform during periods of extreme volatility they're boring but they have their place in your portfolio you know when people say to me oh I'm never gonna buy an old boring like a chevron or a Pfizer or Roche those are the ones that you love on days like today and that's why they should always be there you love on days like today when the market is falling Kevin but not when Treasury yields are rising I mean the big the big bond route doesn't that make you nervous as a dividend holding holder of stocks that there's some real competition now against those stocks because you got bond yields at multi-year highs you're making an excellent point and here's my comeback to that go back in history and look at periods when economic activity and low unemployment have forced the Fed to move in up rates you do get a correction like we're having now but then you go to the companies that are increasing cash flows and increasing their dividends during that period like the boring ones I'm talking about and they continue to perform even in a rising rate environment the reason the rates are going up now is the Fed has no choice but to actually deal with the fact that we have extremely low unemployment we've had really strong earnings and the economy particularly the small cap companies that I invest in all over America we're having our best year ever ever and we're loving what's happening with policy and yet we have to deal with the fact that the Fed is starting to raise rates so no I'm not in love with stocks that don't have enhanced cash flows or don't have the benefit of tax reform but there's so many to do that I actually think we're gonna end at we're gonna have a good year at the end of this year and I'm still bullish for next year as well maybe not twenty one percent earnings growth but I think we could have a good strong six to eight percent and there's nothing wrong with that assuming policy stays the same so Kevin flesh that out for us a little bit more if you're so optimistic about the strength of the underlying economy and the small and medium-sized companies that you have such good a knowledge of an exposure to why are we seeing such a big sell-off on the broader index put us and put aside the dividend yield pick just the broader S&P 500 and the other indices today how much more downside is there that would be sort of justified versus the strength in the economy you're seeing well I think it's fair to look at large cap companies and say that they should have some exposure to the volatility of the rest of the world because 47% of the SM earnings come from overseas market notably Asia which is having a massive correction and Europe which is slowing down a little bit obviously the German numbers over the last three months have been slower than people anticipated and it started to be reflected in some of their debt but I still I still look at that and say to myself okay I'm gonna own those companies because of their sheer scale and their growth in dividends and yes we have more volatility because there is some concern about China and other markets but our own domestic market our companies in this country which don't sell abroad which have a lot of their input costs at question which is one of the reasons small caps are correcting people are worried about tariffs actually affecting the input cost when I look at it I have over thirty of them now in air almost every state we've never had the lack the last two quarters I've never had anything like this in my life we're hitting on every cylinder we've got and so look yes we should be concerned but the core economy in my view the American core economy is on fire it's on fire like it was in the 60s that's how I feel about it so when you talk to me about competition with my new dollars going in I'm not gonna go buy a ten year at three percent because my companies are doing better than that every quarter so why would I want to put it into a long-term debt position that's only giving me three I'm still bullish on the American economy my money's still going there because I live it every day these are not public companies these are private ones that send me a check every quarter and cash flows are going up I love them not blue apron Kevin down 16 percent in the last three months sorry I just got a call that one out I know it's in your power lunch stock draft not a good environmental dividend payer I I live in volatility like everybody else does and I can't be right every day but I buy balance sheets that generate cash flow that's been my mantra for a decade and it's protected me during times of extreme volatility Oh 708 I mean you know these are the companies that come back faster and when you're an investor you have a decision to make every day do I want to go to cash and by the way cash isn't that horrible these days you make 2% but if a company can generate five and six and seven percent increase the cash flow I'd rather be there and live with the volatility and the reason we're not having a major correction yet on the China story if we get a deal done as we did with Europe as we did with Canada as we did with Mexico if we get a deal done with China Katie bar the doors because the upside on the SP if that gets worked out will be extreme will have it will have a concern about a melt up which you don't talk about on a day like today and that's why the market is waiting to see what happens so minutiae and Kudlow put your nose to the grindstone to get some work done there and solve this oil all right hopefully they're watching Kevin thank you in defensive it's good to see you as always Kevin O'Leary oh sure is ETL we know why he likes dividend so much because he's used to getting a check every quarter from his private companies he needs to get the check he likes the cash flow Mormon great perspective they're mixed perspective from Kevin let's check in on some individual stocks to watch today turning a bear Barclays note turning bearish on Alibaba cutting its price target 2 to 10 from 2 to 5 it also lowered its revenue growth outlook for advertisements due to slowdown in China's macroeconomic environment Key Bank also cut its price target 2 to 15 to 20 and Alibaba stock as you can see is down some 5% of course it's been performing badly on China fears I dived in some of the valuation on this and next year this is from the Barclays note it's got a PE of 30 29.5 you compare that to Apple and Facebook in the high teens Google in the mid-20s and you suddenly think white why on earth would you be buying that but exposure to a high-growth tech sector when you've got those China fears as well and a premium valuation for Alibaba even even despite the fall that we've seen recently on China fears I mean it was having double-digit revenue growth the results were amazing and it was growing very fast all that premium valuation but that's still expensive my stock to watch today is Campbell Soup actually a rare bright spot in today's session dan loads third point raising at stake in the company to nearly 7% from 5.7 percent according to an SE the filing he's also put out some letters I mean that this is there's a proxy fight he wants a full board but 5% to 7% does that get increased his power to get what he wants well he's up against him he's up against most of the family the family split he has one of the members on his side the shareholder meeting is November 29th and he I mean it's gonna be tough for him to get the votes the thing that's working for him is that the the perf underperformance of this company both in earnings and the stock price but the company is going through a strategic review it has an urgent search right now for a new CEO and it is fighting back saying that Loeb hasn't really presented anything new first he was pushing for an outright sale now it seems like he's pushing for a turnaround to the business but unclear what he's laying out to do this so it's getting more bitter as we approach the date and we're gonna wait now for response to loads latest letter from Campbell's how did that end of November vote some good soup up 1.2 percent let's go back to the broader markets we're down 576 points on the Dow so we're slightly off the low which was down 640 but we're still down more than 2% and down around 3% on the Nasdaq joined that joining us now Steve Phil financial chairman and CEO Ron reshef Skee thanks very much for joining us Ron I mean what's your first take on this sell-off where we do this type of pullback or is this a panic bit of selling that people should be using as an opportunity to buy look I think that we haven't had a five-day pullback since April you've got rising rates got the 10 year going up I think this is healthy I think this market could correct here we could see another down 5% but echoing your previous guest comments the economic conditions in the United States are very favorable so I mean Ron you've been bullish for a long time can you explain the action in financials why they aren't getting more of a benefit from this new world of rising rates other financials have had a huge run here as well and and you know you're seeing some tepid loan growth and some things that maybe don't completely square with with what you're seeing with rising rates but you know the financials our re have pulled back but again I think they're gonna be fine I think the economy is gonna be fine this is a healthy my message is this is a healthy correction not at the beginning of a bear market my caution what kills bull markets they don't die of old age they're killed by the Fed I don't think we're in that range yet but that's something you do have to watch what's the kind of Fed rates or the ten-year of 30 array that does kill the bull market well look i think that Pease come in as the ten year Rises earnings have to keep up with that today our equity risk premium something I always look at the yield minus the ten-year makes the tenure becoming increasingly competitive with future equity returns so you know the tenure would get 350 360 and earnings don't rise very much that could be the recipe for having a market not performing very well but what we have to remember absolutely have to remember is that the United States with the fiscal policies the tax policies invest on a strong dollar earnings here can surprise on the upside as well so I wouldn't be getting overly concerned about what I believe is a healthy correction in this market I'd be buying stocks after this is done I think although I must say you can see another 5% down from here so everybody is using the term late cycle today one of the most popular on the network I wonder how you interpret that because you see a very strong economy I mean most of the data backs that up is this late cycle and if so what does that mean as far as when we hit a recession well I think a lot of people do think late cycle they don't I personally believe that we in many ways had a recession in 2015-16 when industrial production you know was really almost recessionary levels today with the fiscal stimuli with unemployment with the United States as strong as it is I really see the next couple of years being very very favorable so I don't see it late cycle I know that's been the popular word today I think again normal correction we do have Corrections every once in a while let's have one now and just get on with it in terms of what we're seeing around the rest of the world does that concern you or should the u.s. be a little bit more insulated from negative news flow or negative moves in stock markets whether it's in Asia or in in Europe oh look I do think it's a negative I think the story at the beginning of the year was synchronized growth the I the IMF was talking about the world growing in a synchronized manner and I think the only one that's held up their end of the bargain on that as the United States the rest of the world is in a correction and I don't think we can turn a blind eye toward that at all that may be one of the reasons we're getting a pullback but I don't believe that it is the beginning of a bear market all right some optimism Ron thank you for joining us hey you know absolutely I've been right so far we'll see Ron couch SK the CEO of Steve faux let's get back to Bob Pisani for more on what is behind this big sell-off Bob with the dow down 630 points yeah we're down more today than we were in the prior four days 1500 we've been down on the SP but the same stuff is down the most there's two major problems those are tech stocks and industrial names so you see tech and industrials on the weakest we also have some weakness in energy but energy has been a big market leader recently banks relatively down 1% but not down nearly as much as the rest of you look at the Dow laggards these are the same laggards we have seen every day so you get your Microsoft and your apples and your bowling in 3m s you get your big tech names and you get your big industrial names we all we talked about the tech situation we've transitioning from a low growth low yield world in that world you bought tech now to a higher growth higher yield world where tech is a bit out of fashion Treasury starting to look very attractive against certain stocks and that's a big factor and now you start getting the question about do we play more value stocks so look at the Dow leaders or release stocks that are not down that much today your P and G's your Johnson & Johnson your Walgreens your McDonald's these are the classic value stocks there's a certain flight to quality here but there may be a long-term sneak stickiness about this value play that finally works on a longer term basis it hasn't worked for 10 years market leaders I just want to emphasize we've been telling you all day look at these tech stocks that are 20% off of their 52-week highs but a lot of tech a lot of leadership is still doing very very well health care is only 2% from its 52-week high utilities 4% energy about 5% real estate consumer staples also again all of these are value stocks they're holding up relatively well compared to the bigger declines that we're seeing in in technology and in industrials guys back to you Bob thanks very much for that to see you on the floor in about half an hour's time let's bring in our cash in from UBS financial services arts down char please Bob just outlined the Nasdaq down over 3% it's only the third day this year if it closes there was this warranted this level of sell-off in your eyes yeah I think what you saw was a chest and a failure the first two weeks of October are historically biased to the downside they're usually cleaning up a so up from September we didn't get much of one this year but we're still in that negative two-week period he came in this morning now in the prior days of selling we saw the market go down and various moving averages various trend levels and they tested successfully and bounced a little bit today they went down to those testing areas and failed and I think that prompted a lot of people say oh my goodness this is not what we're used to support is supposed to hold and they're supposed to bounce so the failure to bounce I think brought in additional selling there was a kind of a domino effect where the weakness led to further weakness and I think that's why you're down 600 somewhat I mean it's getting pretty ugly out there and it looks like we are heading into a nasty close so what would you be watching for overnight as a clue as to whether the selling continues into tomorrow are we watching the Chinese fix of the currency the Treasury market what's leading the charge I think you want to watch people look through the auction take apart what the bids were to give you any sense if there was any backup from the Chinese I think you want to see the foreign markets as as we were breaking through the support levels the markets in continental Europe the Continental markets were beginning to accelerate on the downside so I want to watch the foreign markets and see how they go to see if this picks up I do think it's a it's a bit of a calendar item and when we get past these first two weeks things may slow down as you mentioned the last couple of hours 90 minutes of European trade which was pretty bad but dax looked particularly ugly we've got earnings kicking off in earnest slightly tomorrow with some of the transports names banks on Friday is that something that could stem these sellings I mean if earnings comes through in a positive sense I think it would if we get through the earnings period and they're looking like they're holding up that will begin to mollify some of this but for now it's 90% technical with I should say 80% technical or 20% concern about foreign things such as currencies and such as trade wars everyone's wondering if this is finally the shift from growth to value what do you what do you think when you hear that I mean value stocks have been performing much better throughout this well I think because in this case they're a bit more defensive you know the growth comes into question because you don't know what's going to happen with world trade and what not I think that's the trend that's going is it going to be a major shift in the market direction I'm not sure of that at all thanks very much for joining us there we might actually bring you back in in a moment without three-and-a-half percent on the Nasdaq session lows that means more than seven hundred point decline on the Dow as you can see just there two point seven percent pretty astonishing slide in that sense our cash in is still with us on just at your response to that are down three and a half percent on the Nasdaq seven hundred points on the Dow yeah no I think that this is end of day people are going out from a very nervous day just as Sarah said there there are concerns about what's going to happen in foreign markets as you were reinforced Europe saw some nasty selling late in the day so I think people are I don't want to carry too much risk overnight so let me sell it right here I mean if you look at the Dow right now it is a sea of red there's not a single doubt stock that's higher right now and that does include some of the so-called offensives like Procter & Gamble Home Depot McDonald's which were higher earlier in the session they've now deteriorated the biggest losers on the Dow and in the overall market are stocks that have been big winners momentum names winning names like Nike which is dragging down the dime but Dow Microsoft Boeing Visa the sort of liquidation think the reason the selling is broad there's an old saying in Wall Street when you can't so what you want to sell you so whatever you can including your grandmother's necklace okay so some of the favorite stocks are no longer favorite when you're in this kind of solo we've just dropped off below the 200-day moving average on the Nasdaq where we're quite a long way below the hundred day moving average on the S&P now is that something of concern for you you mentioned falling below those lines what when's the next support after after we crash through those well I think what you'll have to do is see where they actually close here because what happens is they get when the show up begins to turn panicky you step back away from the support so I'll take a look at them and tomorrow morning I'll give you certain numbers you can take a look at thank you very much I would just point out Wilfred that as we are seeing I don't know if you just qualified it as panicky but as we are seeing the steeper drop into the clothes we're seeing a turnaround in bond yields where they're actually buying Treasuries and yields are lower now on the ten-year falling down 320 so the tenure in the two-year yields have gone lower on the daily flight to shave right where I was sort of wondering where that was at the top of the hour traditionally you see that in two US assets but but only when it started to accelerate going into overnight and people say I want out of the risk area and stocks I need some protection let me bite someone I think they're gonna be a lot of phone calls to the Fed tonight among internal Fed members should we be concerned about this and where we're gonna pick up you think there's some blame that goes to the fact I think the move they move a little bit and they're sticking with the dot plots or that the president moving fast yeah I think they I think they move pretty fast you know I've been a bear the economy is great as O'Leary said if you look at the NFIB report this morning that the president of the NFIB made a statement with it there was borderline giddy she talked about how great an environment where you would expect the Fed to be raising rate I understand that but it's beginning to have an effect in things like housing and other places so I think they want to be very wary as they move along I think you got to go away from the dot plots we will hike rates if it is in order so they were almost committed on December already but I think I want to hear some conversation from the various fed presidents and Fed governors as to what the monitoring are great stuff as always all cash in thank you very much let's send it back to Dom Chiu for a look at the moving the volatility index today Dom all right so the volatility index the CBOE Volatility Index the VIX is it's otherwise known as is right now near the highest levels of the session I'm not going to quote it in percentage terms but to give you an idea of what it's like we are now at 21 spots 6 7 this is now one of the biggest levels that we've seen gaining in the VIX here in months now at this point you also mention how that's translated into broader market declines here you mentioned that 200-day moving average for the Nasdaq overall with the Nasdaq Composite at these levels breaking below that 200-day moving average it's the first time that we've actually gone down below the 200-day moving average looking at the charts here since July of 2016 so it's been more than two years now since the Nasdaq Composite is seeing this kind of weakness on a relative basis to its longer-term trend averages I also want to call your attention right now to what's happening with shares of Amazon our cash ins spoke about the stocks that you may or may not want to be in the momentum type names you guys have been discussing them Amazon is important here because right now Amazon also at the worst levels of the day right now down about five and a half percent I would also point out that Amazon shares moving down lower here the last time we saw a day decline like this it's been months now if you go to the levels that we've seen in amazon.com the 1-day declines the worst since we saw back in February of 2016 as well so the entire complex of momentum driven names growth-oriented names tied to internet communications retail in the case of Amazon have been taking it very hard here on the chin we'll see if that in any way shape or form finds some kind of support here but we'll talk a little bit more about some of the levels traders are watching as we head towards the closing bell guys Sara Wilford back over to evil all right stay close Don thank you very much Tom mentioned heavy selling across the technology space the Nasdaq down three and a half percent the Nasdaq biotech ETF falling more than 2% today CNBC's Meg Darrell is a closer look at what's driving that drop in particular Meg hey Sarah well like the rest of the market biotech stocks have accelerated their sell out this afternoon now down almost 3% but they're down a lot more over the last week if you look at it the biotech ETF the xpi off 9% in the IBB down more than seven and of course it tends to be the smaller cap riskier biotechs that swing more broadly and that's basically what's happening today I mean check out stocks like amicus X alexis Bluebird and nekked are all those companies with market caps between two and nine billion dollars the larger cap biotechs Amgen Gilead Celgene and Biogen are generally holding up a little better as you can see there that the divergence becomes even more clear when you look back over the last month the IBB which is weighted more toward larger cap stocks is down significantly less than the xbi which has more exposure to mid caps now there are a couple reasons for this divergence one could be rising interest rates or just the fear of rising interest rates investors like less fun lighter v-squared asset management hold that biotechs will suffer in higher rate environments but Cowen research actually took a look at this earlier this year analyzing 20 years of the relationship between biotech performance and the 10-year yield surprisingly they found that in the five periods in that time when the yield generally increased so did the NASA tech biotech index they say investor risk tolerance is a better predictor of biotech performance and that guys could be playing into what we're seeing now just in terms of the broader healthcare move meg I mean actually it's the best performing sector in the SP so far this year of about 12% it's getting hit with the rest of the market today a lot of people looking to healthcare for a leadership position if this market can turn around say there's a lot of value there how do you see that yeah you really have to break it up into the sections of healthcare biotech certainly the most momentum Durbin one there if you look more into names like Aetna and the health insurers those companies holding up a lot better this year the larger cap pharma names generally doing pretty pretty well although not quite as well as the health insurers we were seeing earlier today of course they have some deal news with CBS net not getting approval but definitely some divergence in terms of what pockets of healthcare you're looking at ok Matt great stuff thank you very much for that let's bring it back to the broader markets a new session low on the Dow 765 points but we've come off that down 2.6 percent as we speak the Nasdaq down significantly of course the lag art of of the the major indices down 3.3% there's a summary s piece down 2.7 Russell down 2.4 Mike Santoli has joined us here at post nine as well Mike I mean this s that the selling has really picked up paces we've approached the close yeah I do think you didn't get what had become a little bit of a typical 2 o'clock 2:30 bounce attempt so it did seem as if there was a broader more aggressive risk reduction going on extremely heavy volumes in the ETFs I often look at things like the SP and the Dow are down very much very close to the same percentage right there's a very - differently constructed indexes it just sort of shows you going across the board haircut being given to stocks to me it's about many of the things we've been flagging for a long time in bow in the market that are kind of being all at once maybe addressed so tech got too big as part of the market the US was outperforming the rest of the world too much small cap stocks were lagging and you know I was here saying all that's fine and well but something always comes to the rescue of the overall index you had this rotation that worked for a while today didn't work so clearly this is a big sell-off and it's painful for a lot of people in this market but we look at the VIX and Dom pointed out the so-called fear index at 21 obviously a big jump today but not even near the highest levels that we saw earlier this year like February no I mean in February you had a very unusual kind of round of destruction in in the volatility trading space because you had people aggressively speculating on a continued low volatility so no it's not extreme by historical standards at all as a matter of fact panicking move but it's not a panicky but it's concerned it's showing you a buildup of anxiety is in general terms you really would not like to see the market closed near its lows and the VIX closed near its hives it shows you there was not much of a you know people taking the opportunity to buy into this condition fine Michael to what extent is what's happening today similar to the worst days we had earlier in the january/february time because clearly after that we had a lot of concerns we're in the midst of that but we recovered and rest record said yeah this this if anything reminds me a little more of what we saw even in June where we were down 3% high to low in a few weeks and it seemed as if for half you were not going to get back to those old highs earlier in the year I think the market was more overextended than it has been recently sentiment was much more bullish in January you had to have that cleansed out of the system and valuations were higher so I think right now it's a little more of real acute sensitivity to what 2019 is going to look like for growth for global earnings and for you know whether these trade frictions matter and then when you have bond yields going up at the same time people are concerned about slowdown risk that doesn't feel right right it seems like that there's not as much of a cushion underneath debate with art about how much of this is attributable to the Federal Reserve yeah it's I mean Thoreau observes part of the backdrop I think the Fed beneficials have definitely made an effort in the past few weeks to remind the market that the Fed zone forecast is for three more rate hikes next year the market was not willing to price that in or embrace that as the likely outcome and I think they wanted to say the underlying at the beach last week by Powell saying that we're not close to neutral that felt like a bit of a turning point it did and I think you've got people's attention but once again it was much mostly because he's reiterating what the Fed has been saying on paper but people didn't like him actually saying it out loud so I know I do think that this idea that the Fed is paying attention to things that are not really market-based at the moment anyway they're not talking about global instability they're not talking about volatility in markets because they don't see it as something that's threatening right now the US economic those are talking about and also when you have yields going up and inflation is is the concern as opposed to when Janet Yellen was in there and we were staving off deflation it's it's a different equation because it means that yields can go up and the Fed could still want to get get retire all right Mike stay with us of course as always for technical read on today's market sell-off we are joined now by Katie Stockton the founder managing partner of Farrelly and strategies how much technical damage are we doing today in the sell-off and what level should we watch I would honestly say none at all and with this kind of action we just don't want to panic it I think it's sort of a do-nothing day we can let the market panic for us and in doing so it becomes a capitulated blow so what we tend to see on this kind of days extreme to the market internal measures they get very very oversold and believe it or not with this level of a decline we're still not seeing a lot of breakdowns on the individual stock level and what it's done it's taken sentiment from having been overly bullish at the end of August and now what it would be an overly bearish reading so Katy that's interesting because if I heard that right forgive me if I didn't a lot of market participants today have been pointing the fact that we've crashed through the 200 moving day average on the Nasdaq that the S&P is quite significantly below the 100 day moving average where we stand but that's not something that concerns you as a technical analyst there's a couple things obviously moving averages do tend to act as support at times so we have to look at the most cushions not precise points and also acknowledge the fact that the major indices have really tended to bottom just below these moving averages a good case in point would be the Russell 2000 index relative to the rising 200-day moving average and to that index I would point out that it's got its first intermediate term oversold reading since mid 2017 with this decline and even with the magnitude of the decline in the small cap front which a person that people oversold on a relative basis we don't have as many breakdowns as one might think what about if we look at some of the other international markets are you less concerned or more concerned out there clearly the the influence we've seen whether it's on a good day or bad day from Asian and European markets recently has been significant on the US market we indeed have seen underperformance outside of the US and certainly down trends are more prevalent outside of the US what I'm noticing in the charts and these are still low conviction signals but we are seeing some short-term counter trend signals that would advance the oversold conditions that we have overseas and when you look at the relative even against a nice so-called safe haven market like Germany's DAX you are seeing these counter trend signals that would suggest you get some rotation from overbought markets on a relative basis in overtly or oversold market okay Katy thanks so much for joining us Katie Stockton then and send it back to DOM - at HQ with a look at the key levels to watch all right so will furnace you you and Katie Stockton just talked a little bit about those levels the cushions and those moving averages that Katie Stockton was telling about we just want to visually show you by putting those trend lines into play with regard to what's happening right now you mentioned the Dow Jones Industrial Average right now the 50-day moving average the 50-day average price is the one that is in play and as you can see here we are just below those levels right now trying to see if there's any way we can find some support remember over the course of the past year we have kind of bounced off some of these levels in the past so we'll see whether or not we can move that trend line over to the upside the other thing to watch here as well as another chart that we've kind of spoken to this this whole idea that there are moves in longer-term averages as well the Nasdaq Composite this is that 200-day moving average and as you can see we have now just dropped below that level there so watching that in the Nasdaq as well and one more point here to put a finer point of this whole thing as the russell small-cap index that one is well below its 200-day moving average so as we watch these declines outsized overall these are ones to watch now if you are looking for a bright spot in this market just follow me here to the wall because there are have been parts of the market Sarah mentioned utilities is out performers but if you take a look at some of the ones that have at least stocks specifically been doing a little bit better relatively speaking it has been some of the retailers that are perhaps multi-line in characteristic here in the United States but we're talking about mid scale names like a Kohl's department stores those shares are actually outperforming the market in the green so far today you can also see what's happening with Nordstrom now out performers just in the red now by 3/4 of 1% dollar tree is up by 2% and target off by about a half a percent at one point all four of these stocks were in the green but they are relative out performers so as we talked about perhaps the movements that we're starting to see there is a sense that some of these stocks could in this current environment be out performers and you're starting to see some of those play out at least in the domestic or oriented multiline consumer products names retail names like we're seeing here guys oh by the way it's the worst doc thanks very much sorry let's just check in and some of these records da which is significant the Nasdaq is on pace if it stays where it is down over three point nine percent for its worst day since and brexit that really puts things in perspective let's start that the Dow though there is the Dow intraday chart for you and we're down over 800 point moments ago with down 790 but essentially we're right near those session lows a really ugly chart there today quickly look at all four indices and we point out there that the Nasdaq is the lag are we did have all four the indices down more than 3% moments ago but the Dow is just above that but still a significant decline the Nasdaq almost down 4% as we look at things but just that shy of that level the Russell also down just less than 3% going to show the DAX chart just quickly in today because very sharp selling in Europe towards the end of that session which sparked a pickup of selling here as I bring in Bob Pisani and Kenny Paul Kerry for that takes Bob you're refusing well off of the tires we've been pointing out the Germany of more than 15% off of its 52-week highs important to emphasize why this is happening we're moving from a low growth low yield world to a higher growth higher yield world tech becomes out of favor Treasuries start looking more attractive and value stocks like consumer staples for caps start getting worth it well that's true but you know at 3:30 when the Nasdaq broke its two hundred and seventy thousand four percent right exactly right but when Nasdaq broke at seven at 3:30 you could feel the flush in the market right because look what it doing the Nasdaq now they're gonna close around close all the algorithms wouldn't overdrive and you had this risk off because these black boxes these algorithms say you know they take those technical signals so now it's all about a technical break you could say anything you want about raid talk about China sorry anything up now it's about detectable [Applause] technicals it works on the fact that the world is changing in there nice picture fire boss you've got higher rate after than six months ago guys thanks so much for joining us that right the end ring the bell the big Fort Defiance thank god ring it after Nasdaq which closed down 4% wow that is a huge decline for us in today for the Dow without 820 points extraordinary sell-off that we see today that does it for the first time that those involve much more discussion coming up on the second Sarah back to you [Music] and welcome to the closing balance their eyes in here for Kelly Evans Wilfred Frost rejoining me in just a moment Mike Santoli is here CNBC senior markets commentator let's take a look at how we are finishing up a brutal day on Wall Street it was ugly throughout the session and the loss has really picked up steam in this final hour of trade Dow closing just about near the lows of the day of down more than 800 points lower by 818 points or 3% SMB 500 down three and a third percent check out the Nasdaq tech leading the sell-off lower the Nasdaq Composite down 4% that takes us back to that takes us back to levels of May 29th for the S&P we're now at the lowest point since July and the Dow the lowest level since August 16 the russell 2000 which has been in a correction mode down almost 3% as well ugly and broad-based across the board Mohamed el-erian Allianz chief economic advisor will be joining us in just a few minutes with his take on the sell-off and what to do next let's talk about this market Stephanie link from Nuveen Atia a company is here Dell red across the board biggest loser though was Nike over in the FMP dollar tree was the winner today Tiffany was the laggard we talked about that after that warning on China from LVMH over tonight Mike what stands out to you in the sea of breath it was pretty indiscriminate you had more than 90% of all volume to the downside that's actually been pretty rare even when the markets had trouble you haven't had that first 1% move in a long time I think a lot of a lot of things kind of had a log of a little bit of a break today right we had this rotation that was kind of rescuing the indexes for a long time but we're the markets who's being stressed tested by this new higher level of yields and the fact that it's going to have to cause some kind of valuation adjustment we're very sensitive to any hint of a slowdown in earnings growth you saw that anecdotally building up for a while here and I think that was it that plus some technical breaks got you this flush of selling it's not great that we closed near the lows for the indexes and at the lows for the volatility index it so shows kind of an unstable tape we're gonna have to see that being said getting oversold fast and it would not be surprising because most stocks have been down for a while to have the makings of a bounce taking shape Mike when we first or in the last six months experienced this for the first time eight nine months ago in January so much talk about this is the first time we've had such a big son seller since markets have been so dominated by the algos by the index fund does that make when we go four percent in one day first time since brakes it for the Nasdaq does that mean tomorrow we wake up and have the same thing again how do we show you no I don't think so I honestly don't think so I mean look it changes the rhythm of how the market trades I think you have a lot of kind of signals that a lot of people are following collectively but I don't think it feeds on itself if anything the algorithms are essentially the most disciplined trader you could ever have so they're not going to press they're going to probably look for out the mean reversion bounced at some point breaking news now the White House is responding to today's sell-off on Wall Street a man jabbers in Washington hey thanks Sarah that's right I can tell you that President Trump has been briefed on today's market sell-off in the Oval Office this afternoon just before departing a few moments ago from the White House on marine one on his way to an event in Pennsylvania this evening a senior White House official is offering a statement now on the market sell-off saying this is a bull market correction it's probably healthy this will pass and the US economy remains strong so the message from the White House is that this is a bull market correction that obviously is upbeat language to use to describe an 800 point plus sell-off here but the message from the White House clearly that the bull market will continue after this correction they're saying that the u.s. reconnaissance in this type of situation on days like these in the past have always pointed to the fundamentals of the economy and in this case the White House is doing the same thing saying this trend that we've seen in overall economic growth is not going to go away just because of one day of bad selling on Wall Street sir mm we'll the Chinese negotiators be licking their lips at the sight of this that's a fascinating question that it does put some political pressure on President Trump the president just left the Oval Office a few moments ago did not take any questions at all from reporters who were gathered in the South Lawn to try to get him to talk so the president ultimately the president ultimately not responding to this today we'll see what he says tonight in Pennsylvania he may address it there he's always he has talked about the stock market more than other presidents have talked about the stock market the White House initially at the very early days of this administration said that they view this as a mark to market business they very much view the the Dow as a barometer of their success so they will not be happy to see this today and they would not be happy to see any commentary that might link what's going on in the markets to the president's global trade practices as well maybe jabbers Daymond thank you very much senior White House official sounds very much like our old colleague Larry Kudlow saying at the bull market correction is that what it is Stephanie I think I think it is but I think today I mean we've been focused on rates and global growth swelling but I think today was really more about earnings worries because we had a couple of pre announcements in the last 24 hours we all have talked about the PPG in news right but we had that group which is an industrial that goes into and there's a lot of semi come semiconductor parts that this company will touch they actually massively pre-announced the luxury sector rolled over hard in a huge way and that's even after LVMH actually reported a good number but apparently September was a no comment in terms of business stricter check much and well I think yes but they've included a good number but people are wondering if that's sustainable so but that's a big group and that's been a big growth at a momentum area in this more okay so and then of course I'll by the way quietly Alibaba is calling around saying their numbers are too high so all of these things are putting into question earnings and that's what I've been saying all along that earnings have been hurting too little stay strong because the economy is strong if all the sudden earnings aren't that strong then obviously you have a lot of problems now I also say it's way too early to say that earnings are going to roll over way too early because the economy does remain strong do you have to be patient and that's why sorry your question is at a bull market pullback yeah it is we're in a bull market it's a pullback if you pick your spots now of course the big move that today was the Nasdaq all everything was a big mover but it was the biggest mover down over 4% Arthur Koontz is up there with the breakdown of really with an aspect decline here was led by the big names the usual big names and the chip sector Stephanie talked about how you know a lot of these producers use chips chips in a way are kind of the cyclical sector within technology and that's where we saw the biggest declines today one of the worst performers for the semiconductor indices since last June that we've seen and we seen a number of lows today in semiconductors including Marvell technologies on semiconductor and as those guys start to report there's going to be a lot of concern about just what kind of demand they're going to see especially as we start going into the new year and what's going on in this current quarter a number of the big names like Amazon as well have been lower Amazon has really been under pressure since announcing that increase to $15 an hour as a minimum starting wage for a number of employees there are some employees who complain that they might actually make less under that policy because they'll no longer be getting stock bonuses and monthly attendance bonuses and things like that but it does raise its underlying costs as it pushes those wages higher and that's likely as does for Amazon in any business that they enter in anything that they do likely to impact other retailers today that said you did see a few retail names today that were higher and another sector that relatively outperformed today was healthcare the biotech was lower here on the Nasdaq and biotech is usually one of those sectors that can be very volatile today some of the healthcare services names outperformed Express Scripts finish the day lower but it actually hit an all-time high today as a rival over CVS over in NY I see got the go-ahead from the DOJ for its Aetna acquisition back to you thank you very much for that if we come back Stephanie to your point about if earnings follow this news/bad than we really fall out of bed which of those tech names are you most confident in their numbers for but that's declined so sharply today well I would say the software companies and they sounded the best at in conference season IT spending is at record levels and most of these companies don't expect that to wall at all and that's because it's driven by secular growing themes that we've talked about forever Internet of Things and cloud security software so those are ones are they're not cheap and they haven't pulled back enough in my opinion but those will be the ones I put on my radar and then I also think I look at bang I still like Facebook because I'm on a relative basis if I do think it's the most beaten up it's the most controversial and so that one is actually held in a little bit better in the last couple of days than some of the other fan names but I think that's also a name that I'd love to be by just looking like not a single man information technology index close fire today and communication services the new social media internet space exactly I mean there's a lot of air under all those stocks it's it's where you would go and if you want it to turn stocks into cash that's where you reach first I do think in general what's interesting though is we're I mean who knows what's gonna happen in the next several days before earnings season but if we go into earnings season with the market being very sloppy and a lot of stocks beaten down it's going to be a different complexion two responses to those reports than we've had in past quarters where everyone was expecting great numbers and the stocks with it could be a better set up yeah but I do think also just a big picture so in January or February we had 10-year yield ten year Treasury give the 2.6 percent we were expecting 20% earnings growth now we're expecting in the next 12 months what eight ten percent earnings growth and the yields at 3.2 so that tells you that that's kind of the push-pull of valuation against good numbers it is decelerating multiples are from down from 19 and a half times to 16 and a half that's just another way of saying earnings have been so great he rescued an expensive mark but you're not asking to pay as much at this point because we have had multiple contraction all year long and I would argue that that's really the reason is because of REITs in general not just not necessarily on the earnings run it's the concerns about rates I just want to bring in someone else to this conversation joining us now by phone with more on the big sell-off is Mohamed el-erian chief economic advisor at Allianz Mohamed with the Dow closing lower by a 831 once you've been relatively optimistic about the state of our economy what's your level of concern after this big sell-off today this time maybe it's because I was on a plane earlier today but I think of this as the markets changing entrance well while flying at a high altitude what do I mean by that we were a liquidity driven market we are becoming more a fundamentally driven market that's good news over the long term but will inevitably have lots of turbulence in the short term and it's not simple fundamentals this is in the midst of big divergence and growth and policy among advanced economies so it's not surprising to me that we're seeing the only question is you know why did it take so long but it's not surprising me at all Mohammed Ali in the week you said the IMF was too bearish when it downgraded global growth so do you remain as optimistic as ever on the outlook for growth particularly in the US and if so is this just a temporary pullback so I do I think the US will be a 3% growth economy both this year and next year the IMF has us a 2.9 and 2.5 but I also said if you remember that they were too optimistic away from the US and that speaks to this key issue of divergence when you get such divergent growth weights and policies you start stretching markets remember only yesterday the yield differential between the ten-year Treasury and the 10-year bond was 270 basis points as enormous so there's a lot of stress going on in the context of the u.s. picking up momentum and the rest of the world decelerating what about this move in bond yields Mohamed how severe does it look to you and do you expect it content to continue given the economic backdrop and what the Fed is doing yes you know it's not going to be linear but I would expect higher yields and I would expect a steeper curve and that's totally consistent with both what's happening on policies and the economy but also what's happening to non-commercial buyers of long-dated bonds they are slowly exiting the influence is being reduced and therefore we should expect both higher year and a steeper curve but it's not going to be linear ma'am ma'am but we got a comment from the White House that said look the fundamental growth in the u.s. is still fantastic this is just a one-day market move and people shouldn't be a worried about it I'm paraphrasing that of course what will the Chinese reaction be when they see this type of share price declined is this even the playing field in terms of the negotiations between the US and China even as a strong word Wilfred I think what this does is it makes it Chinese say well it's about time you know our markets have been really beaten up when all this trade war rhetoric started the US was holding in finally the u.s. is starting to react so I think they're going to see this as somewhat better for them but I don't think it fundamentally changes bonad the Bears what it would say they would argue with you and say look the fiscal stimulus can't go on forever and the the feel-good effect is going to wear off the Fed is raising interest rates which it typically does in a healthy economy but that can also kill the bull market and the economy and lead to recession we're heading into a trade war tensions have only escalated with China tariffs on both sides and cost pressures are rising for corporations this is all starting to manifest itself in corporate America so what's the main argument there so I would say to them you have to distinguish between the baseline and the risk scenarios yes there are lots of risks you could get a policy mistake by the Fed you could get a market accident whereby the technicals take hold of this market and yes we may end up in a trade war I've put that probability at 25 percent you know that's that's a meaningful probability for such a big event however if you look at the baseline there's something striking going on about the US it's not just about physical we are seeing a pickup in yes fiscal spending but also household income and also business investment so you've got three domestic engines webbing up at the same time and that should take us through this year and next to potential growth but for the next two years sorry continue Mohamed now the thing is that for next for the next two years you know growth prospect on good for the US Mike clearly Mohamed is optimistic about the growth in the US he mentioned technicals can take hold but but isn't too concerned about that I mean how likely is it that that does happen the technicals take over and I don't think anything that happened today would give you an idea that the market is fundamentally disorderly that there's anything that's kind of adding some spring-loaded selling power in here this was a pretty orderly adjustment in stock prices right now it's painful it was all in one direction and it was a big bite all at once I do think that bigger picture I mean if we're talking about technicals I mean I didn't see the credit markets freak out today so a lot of stuff that you would look for to say oh there's something that's mechanically wrong and how the markets are acting I'm not seeing any of that I do think though you know Mohamed brings up this great point that the u.s. seems like it still has this growth and I would ask actually if the Fed is looking at exactly those same things and feels that's exactly where we're headed are they not just going to stay the course with the with the rate hikes and I think that's maybe what the markets trying to acclimate itself to Mohammed yes they are I think that that the market has to realize this is a different set the Fed put as people people like to call it it's way out of the money now so I don't think this deals the Fed in any way and I think we just have to get used to the fact that we have to stand on the basis of fundamentals and not on the basis of central banks it's not an easy transition it's going to be volatile but over the long term it's better for the health and the robustness of markets we will leave it there thank you so much Mohamed el-erian don't stop a flight and on the phone with us let's take a look at how broad this sell-off was Bob Pisani looking at the stocks leading the decline Contessa Brewer is breaking down gaming stock Kate Rogers looking at the restaurants Lesley picker as the hedge fund angle we've got it all covered for you Bob let's start with you of the year are the biggest losers today now we have been talking about the hip to tech and industrials thoughts for different reasons but let's just show you what was down the most today you see Microsoft Boeing 3m Apple I would add Nike into that as well what do they all have in common they're all up 20% or more this year so there's a certain let's take down the winners there's a certain let's sell tech and thoughts L industrials but it's fairly broad take down the winners the leaders we've been emphasizing that the more defensive names you're Procter & Gamble's for McDonald's you Johnson and Johnson's Walgreen all right down but much less and really these were flattened going in to the last half hour or so tech we've been talking about big names that are in correction this didn't happen today we have seen most of the big tech names they hit their highs several months ago but particularly semiconductors like micron down 30% Facebook him the highs way earlier in the year Intel is now 22% over size alphabet a little better down 15% why is this all happening it's happening too close the investment world is changing its different before we were in a low growth low yield world now we are transitioning to a higher growth higher yield world what does that mean well that makes technology less attractive it makes potentially Treasuries more attractive against stocks that's a big factor what's going on and it makes value potentially more interesting over growth it's an old story hasn't stuck really but it may stick this time I just want to show you the market leaders we keep telling you about all these stocks off their 20 off their 52-week highs and yet look at the market leaders right now we're healthcare utilities real estate consumer staples not down nearly as much as some other sectors like technology from their 52-week highs what do they all have in common they tend to be value names so that's the story to keep an eye on as we go into earnings guys back to you Bob Pisani Bob thank you let's get to contesta brewers looking at the impact on casino stocks Contessa well we were talking yesterday about those rising rates and the impact on stocks here Sarah and the big loser on the day is Caesars which has double the debt to earnings ratio of its nearest competitors and 75 percent of that balance sheet is tied to floating dead and as you can see it's down almost more than 6% on the day Milko Resorts another big loser on the day down 4% or so that's tied to a lot of these concerns over an impending trade war with China ongoing as well as a softening of the Chinese market in the way that the Chinese government may affect qualitative measures on Macau Gaming we're also seeing Las Vegas Sands losing some ground golden entertainment losing some ground one bright note on this spot is Penn gaming which is acquiring pinnacle for 2.8 billion dollars I talked to the CEO of Penn today Tim Wilmot and he said he thinks that the reaction about rising rates and the impact on Sox's loads largely overblown in his case he says his balance sheet is all fixed debt so it's not moving and he says that he expects a much larger customer base coming online as well as an opportunity with 40 casinos to really build their loyalty program both of those socks today Penn & pinnacle up on the day well contesta thanks very much for that let's focus in on restaurants Kate Rogers restaurant stocks closing right in in the red rather right along with the broader market say the stock that took the biggest hit on the day Shake Shack was closed down more than seven percent Domino's had closed down about three and a quarter percent followed by Starbucks and Chipotle both closing down around three percent today interestingly enough I know Bob mentioned this a lot of today's biggest losers were some of the best performers for the year including Chipotle up around 50 percent year-to-date Domino's Pizza right behind it up around 45% so far today the only restaurant stock that closed in the Green Brinker International that's the owner of Chili's and macaroni grill McDonald's had been positive earlier in the day thanks to that upgrade from guggenheim before it closed down almost 1% today and of course the sell-off comes before a wave of restaurant earnings that are coming in the weeks to come guys back over to you okay thanks very much for that let's now go to Leslie picker for the impact on hedge funds from today's set-off Leslie hey well if I want to read you a line from a report I got this morning because I think it really sums up kind of the sentiment leading into today's moves now this report which is from a prime brokerage says that hedge funds risk down not off by adding to equity shorts reducing tech Long's and pressing the UST 10-yr US Treasury 10-year short as rising rates derail one of the last remaining profit centers tech stocks so what does that all mean exactly well hedge funds have been repositioning to be more defensive they've been hunkering down and many seemed to be leaning into today's movements now the report notes the distinction from prior sell offs January 2016 and most recently the one in February 2018 where we saw that huge volatility spike saying that managers this time are actually repositioning their portfolios they're changing them to be more defensive now of course much of this volatility can be an opportunity for hedge fund managers that's a way for them to generate alpha from their short book but I've been texting with sources in the industry and I'm getting lines like sea of red bloodbath those are some of the main things that people in this industry are focused on right now of course it's too early to tell exactly how today's market moves have really shaked out but we're going to be reporting this all afternoon and evening back over to you Leslie thanks very much for that now a good deal of talk today about the sell as being tied to rising rates and more fed activity potentially more fed activity in joining us now on the phone with his insights former Dallas Fed president Richard Fisher Richard thanks so much for joining us clearly there's been a spike in yields of late in recent weeks today there wasn't too much of one but it's been a big factor concerning equity market investors what do you make of the recent rise in rates and the pace of it in particular well we had a weak three-year Treasury and ten-year Treasury auction today so I probably was a little bit of a tripwire but I don't think there's any surprises baked into the cake here it's pretty clear the Fed is continued move along this path this so-called neutral rate they often discuss it they don't know exactly where it is pals made that pretty clear they're likely to pass through where they think it was which is the 3% level we're getting close to that we have a ways to go so I I think it's very almost conceded of market operators to blame this on the fact there are no surprises here and and by the way they can thank the Fed for having turn the market at 666 the devil's number in March of 2009 it's been on a run since we had a great year last year DSP was up about 20% or so so I don't think it's fair to blame it on the Fed and we're I sitting at the policy table like I did for 10 years I'd be saying we need to continue to gradually tighten because we're seeing some wage price pressure begin to develop now but more importantly we need to have as I like to say some nuts in the tree to get back to when the economy against the Turner we haven't seen evidence of that yet yeah I mean you've been warning Richard that it's going to be you know not the easiest transition to go from a world of easy money back to normal what this could be but I'm really glad that we have you because I know you know the current Fed Chairman Jay Powell and you know former Fed Chairman Janet Yellen and you know there was this idea of the Yellen put that whenever the markets threw a huge tantrum the Federal Reserve would look at it and may even pause or rethink the direction of where they're going or how fast they're going do you think that Fed Chairman Powell has a stomach to handle these kind of sell-offs and this kind of jump in rates probably a stronger summit summit rather than his predecessors yet although I was with Janet on Monday night and we talked a little bit about this she feels very strongly that they should not be upcourt she made a very good point in our conversation I don't want to violate her confidence but several people have been saying this which is the market went up is rates were kept low for a long time it's only reasonable those rates go up the market should adjust the way they discount future cash flows to present value so no I J Powell comes from the credit market side he came up from Dylan read all the way up Sakura C as a lawyer etc into the capital market side through his private equity firm and I know him well I think he has a better constitutional sense of the way markets operate there's not a theoretical economist he often refers to this is a risk management exercise and I think he's probably much more tolerant if you go back and look at the record of what he said in his first meeting of June of 2012 it was that we were had to be very careful here cuz we're cutting a one-way street taking ball out of the market and this could trade a trap later on so I do think he's just coming from his different background it's not a matter of sophistications matter what you understand markets come and go and the Fed has underwritten markets for a long time he made that very clear in his second press intervention which was our job at the Fed quoting him is not to underwrite the equity markets their job is to underwrite the economy provide liquidity in it and that's sorry to create full employment where we're presently far beyond full employment and also to keep inflation today which they seem to be doing rather well Mike do you think if we did get any kind of comment from the Fed that hinted that they're watching this and that they're not as guaranteed to rise rates in December and next year that the market would embrace that to the upside it would probably be taken as a net positive I think that said don't bank on that no I don't know that you're necessarily going to get that but I do think that the market today just today as the selling really did get intense started to try and take back some of the expected Fed rate hikes for next year in terms of the futures positioning so it shows you that there is some level of market upheaval that potentially would would have the the Fed change its mind but I don't think we're there yet I mean well I mean it was doubt it was an ugly day but you're down three and a half percent you've probably done about five six percent overall from the highs so I mean this is hardly something to get really freaked out about now look if this continues for several days and it really gets out of control and it does feel like it's more problematic for sentiment consumer sentiment and business sentiment and confidence and that sort of thing and that's obviously going to be something that you have to monitor but for now it's definitely the worst day for the Nasdaq since brexit that's significant I'm not saying it's not significant but think about how much it's up since brakes it felony remember remember where the tenure was the week after brexit one thirty six six now it's pushing around the 320 level so again I don't see anything unnatural here unless it as you say if it were to continue and begin to infect the economy and that confidence etc we don't know and that's only the Fed will only move when market perturbations volatility Corrections whatever you want to call them are perceived as infecting the real economy because they mention can I just mention something about the consumer I mean we're like that's such a big part of the economy at seventy five percent of the GDP so I always obviously look at all different signs well after the close we had Costco reporting same store sales at 7.3 percent growth and it beat handily before expectation so I'm gonna just throw out a stat like I'd like a date of that way in a couple and I think it's I think it's important to remember that the economy is strong we're in a good place for the Fed to do what they're doing as long as they don't overshoot and that's what we're kind of obsessing Whichard I guess final word to you then we have been talking about this strong economy not just the consumer the labor market I mean lowest unemployment rate since the 60s so how much can it withstand and is it too premature to talk about slowing growth I think it's a little premature I would also look at the NFIB data and how strong it was and it's reporting how strong it has been and the strongest in the 25 or so years that's that database by the way those small medium-sized businesses represent overall 51 or 50 percent of all US workers so if they're feeling strong about the economy they're wanted to connect Apple the economy they're one of the risk growth and hire more people that'll affect your right consumers the key variable and that GNP or GDP equation so here's the thing don't expect the Fed to deter from their path and till they feel or unless they feel that the real economy is weakening they are not driven by what happens in the stock market then they should not be unless it infects the real economy so that's where we are right now I appreciate having the last word I haven't had the last words on all a long time oh it's a pleasure thank you local markets are also experiencing turmoil Seema Modi has the details watching somehow some of the world has been reacting Seema Sarah that is absolutely right higher rates in the US has caused more pain for emerging markets the emerging market ETF down another two percent today Michele was three percent seeing its worst day since August 15th but check out how the individual markets are faring and you'll see that the Russia ETF is trading down about 54 percent from its all-time high India China Brazil off more than 20% Europe is in focus as well a notable decline in Germany which is now down about 17 percent from its respective all-time high rising concerns around the resilience of the Chinese consumer that sent a number of European luxury stocks lower today LVMH down over 7% Berberian and there's Gucci parent carrying Montclair among others I also just want to point out the financials banks in Europe have seen some significant moves in fact over the past two weeks Greek and Italian banks are down about 16% so the pain is significant over season wolf we'll have to see how Japan opens in a couple hours I'll give us a better cue as how global markets will respond to the sell-off here in the u.s. SEMA thanks very much for that now increasing trade tensions with China are just one of the factors behind the market sell-off joining us now to discuss Richard Kang partner Taiwan accelerator and former CEO CIO and emerging global advisors Richard thanks very much for joining us I mean the sell-off clearly has had a number of factors behind it whether its interest rates domestically or problems abroad update us on your latest views on on how much pain China is feeling in its fundamental economy at the moment yeah so they've felt a lot of pain this year like the numbers that were just stated so 20 percent down is a pretty significant drop but they've had bigger drops in 2015 was another more recent painful drop I guess the question is do you see it on the street so investors feel pain in the real estate market the stock market but if you are on the street you can see that they're still spending so what does the Chinese market reflect to you and the Chinese currency in particular which is nearing a very key level against the dollar strong dollar at seven against the yuan yeah so the lower growth projections by the IMF is simply are there are showing it with the stock market down and the RMB down maybe 7% maybe down closer to 10% by the end of the year I guess that's why there's concern from the US government of currency manipulation but if you just think about it for the long term any sort of tariff or trade war is a selective tax investors will need to also modify their selection and allocation thought process to think of what domestic play in the US China wherever it might be will not be impacted by cross-border transactions your supply chain your sales force whatever it might be Richard is there any sense in your eyes that the Chinese government is losing control of its currency that there's a risk that the reserves not so much will run out but won't have enough effect to stem the decline of the currency I think if you ask someone in China they'll say yeah there's probably a lack of controls money flowing out resulted in something like the Vancouver a real-estate bubble there's concerns about cryptocurrency so I would say that most people say yeah there's possibly a big concern there I think for the for the global investor looking at China you simply say look I can access China through Hong Kong because of stock connected which accesses Shanghai Shenzhen you can't control what the Chinese government does actually no one in China can't either because you can't vote for anyone else so too bad you have to just navigate as you would and given it's a it's a big drop in the market globally do you want to allocate more to what you already have Amazon or something that you probably don't have a lot of Alibaba I think that's the only decision you can make right now very quickly just walk us through what would happen Richard if the US does declare China a currency manipulator there been some hints manoosh in telling the FT today warning about Chinese currency devaluations the report comes out next week what would happen if the US Treasury did label that designation yeah so I'm trying to think if this is a short-term thing because it's an election year and there's nothing better for a politician than to find a problem point a finger at that place and say I'm the solution for it that's probably the shorter term but longer term I have concerns it's kind of like two gangs shooting at each other and you know who's the collateral Canada Southeast Asia etc anyone who trades with the with the u.s. or China is going to be a problem and if that's the result of the imb IMF downgrade in economic forecasts of growth then that's a longer-term problem then we have a real reason to see the elastic snap back and end this long bull market Richard thanks so much for joining us which you can Hana at Taiwan accelerator the S&P 500 falling more than 3% today is there more pain ahead Mike Santoli has made his way over to the telestrator looking at some key levels yeah basically we want to look at the field position in general this is a one-year chart of the S&P 500 here's where we could actually be close a little bit below 2800 today right 2785 this was from intraday obviously we gave up that recent move above the former highs that was here 2872 that was the high from January we spent all this time below it I the level that people are now focused on below where we are right now is around 2,800 so here is the 2,800 buck the reason for that is that was about the level that capped the market during this correction period right here we went above it finally in July before we hit the all-time highs that seems to represent the area where people think maybe we have to make a stand to say that that we can kind of protect this uptrend that we've been in for a while now with regard to the 200-day average that's this line right here this is the base colored line we have as you see as Katie Stockton said earlier we dropped below at marginally a few times so there's no magic to that line if you break it it doesn't mean it's game over and everything falls apart as a matter of fact it seems to act as a little bit of a sort of a slingshot effect when we've gotten there so it's not so much a tripwire but I do think if if the market doesn't mount some kind of a defense in the next two or three percent of downside if we actually get some follow-through like that you're gonna have two people saying all of this is in question in terms of whether that was true demand for stocks and Mike just looking at the levels the 200-day moving average is sitting at two seven six five we closed at two seven eight five so just above less than one percent down from here yeah but we are below the 50 and now today the 100 day moving average exact Intimus to the downside well the Momentum's to the downside but very very important the averages themselves are pointing up right so if you're below a trendline that's still going up it's much better than if the trend itself has rolled over and then all of a sudden that's when the market loses the benefit of the doubt like I'm kind of curious if you're worried about just in general the VIX because we've really exploded higher I'm not worried about I'm actually looking for that moment when the VIX says we've had this fever and the fever broke and so you the level doesn't matter as much as when you've spiked up a lot and then you come down a few points especially toward the end of a day that often means that we've kind of had a bit of a flush so yeah if we keep going higher in the VIX especially in this grinding way and don't get any relief that it is telling you that there's you know some kind of vibrations in the market that that it's not like Stephanie I mean your your fundamental person you look at the aren't the numbers in the commentary and the when you see breaking through some key levels and moving to averages what how do you read that I mean I I pay attention to it because I think you have to I mean in this day and age I pay attention to quants I pay attention to technicians I pay attention to fundamentals all of it matters but at the end of the day I still think that fundamentals win and while charts may not look so good and that Vicks chart by the way looks not so good cuz it's spiking higher but I think that you know we have a couple of more days guys until we get earnings so just give it a chance just give it a chance because we're gonna hear really good things from a lot of companies it's always a tough time pre earning season pre-announcement season because it's bad right I mean floor also just pre announced after the clothes Apache just had a terrible announcement about a dry hole so you're gonna get these bad news items and they're all lumped together and we're all gonna freak out a little bit but let's get through all of owning season and if there's something that materially changes then you know I'll see if I change my mind but I really don't anticipate that at all and of course as soon as Friday we'll get the earnings from the bank's tonight and get the commentary on the earnings calls from the likes of Jamie Dimon and Mike orb and Tim Sloan and those stocks actually outperform today on a relative basis and they have been outperforming over the last several weeks a relative basis meaning down but not quite down four percent it's a long term as a long only portfolio manager I have a benchmark and I'm looking at relative self relative no absolutely let's have a look in fact out how we did finish the day on Wall Street of course Sharpe below the Dow's down 3% SP down three point three the Nasdaq down four point one percent that's the worst performance for the Nasdaq since brexit the Russell down two point two nine percent so as you mentioned well for the Nasdaq closing lower four percent biggest one-day drop since back in June 25th the tech-heavy index is by far the worst performer of the major market indices down more than 6% since its August 30th hi joining us now on the phone is Dan Niles founding partner at alpha-1 Capital Partners Dan thanks for joining us this big sell-off especially in the hot names like Amazon and Netflix and the big winners so far it has something meaningfully changed in terms of the investment thesis with this group well I mean I think it depends stock by stock when you look at technology because I think a lot of these stocks were well above where they should have been given the fundamentals and the valuations or what they were trading at it's very rarely that I get asked to do an interview and I feel significantly different at the end of the day than I did at the beginning at the beginning of the day I was like these stocks need to go down a lot more towards the end of the day today we actually started covering a lot of our shorts and started to actually start to pick up some Long's we went into the day with about 15% cash and we started to deploy some of that as we went through so we're actually longer today when you take our Long's - our shorts than we were coming in so we think this is good we think this is healthy we love seeing the panic on the street you know volumes are up almost 40% from what I saw the traded value was up over 50% from what I saw so this is this is a positive in my mind because as someone mentioned earlier when you get into earnings you're going to see some companies like some I think some of these bank names that are going to report on Friday that are going to have some pretty decent numbers and so I think that will help there are other sectors within tech that are exposed to things like autos from China or industrial etc where I think you're going to have some real issues so we've been you know avoiding the semiconductor space been shorted for a while we actually ended up covering a fair bit of our shorts today but we think the fundamentals there are going to be awful so I think it really depends on what you're picking and what spaces you want to be in time what with some of the names that you're buying today well I mean some of the names that we like right now is we're trying to find names where they that don't have China exposure that don't really get impacted by tariffs etc so if you look at like a name like Google for example the good news is they don't really get to operate in China so that's a real positive for them and the tariff situation obviously they're not selling physical goods for the most part so that's good for them so that's one we start nibbling on today I have to close you know you look at you know name like Microsoft obviously they have some giant exposure but not as much as most given you know again there's you know issues with piracy etc and if you look at the PC market this is the first time since 2012 the PC market has grown year-over-year that's a long time and Microsoft's really going to benefit from that you know Intel another name that we like as well for the same reasons you know obviously they have to name a CEO I hope they pick a good one which makes me nervous but you know that you know again you're in a market where the PC market is growing for the first time since 2012 so that's also positive and we like the telecom stocks like you know AT&T for example and Verizon where we think you know they'll have good numbers and estimates we'll be able to hold and go higher so you know that's some of what we're thinking about and you know where we started to speculate in those types of names towards the end of the day dan you didn't mention Amazon I think it's interesting because it's one of the quietest 14% drops in the second largest company in the stock market that I can ever remember all right it's down $300 from that time they kissed a trillion dollar market cap and obviously they had this you know idea they're gonna pay a $15 minimum wage and some of these news items around it but mostly it was just a perception issue right I mean people just got to on board with you know they could do no wrong where do you see that stock at least that's a sentiment towel for overall tech you know that's a really great point well first when you look at it they don't have any real business in China either so for them you know a lot of this doesn't matter now I think the $15 minimum wage increase that does matter that's going to ask we ask me somewhere around a billion dollars for their cost structure if you look out you know from when it's implemented so you can't ignore that the flipside of it is is that they're leveraging a lot of the infrastructure investments they've done in the past and they're you know foray into advertising is really good because obviously if you're trying to sell products we're better to advertise and on Amazon where a lot of people go to buy those products so it's not one that we're quite you know there yet because we're still trying to figure out cost ramping from the minimum wage increase etc against the positives that we have here in terms of cloud growth being strong etc but it's one we're definitely looking at that we want to get involved with again because I don't have a lot of inner you know whisk from Cheyenne our autos or industrials when you're talking about that name obviously consumer sentiment if the market keeps dropping like this you know that will get dented and you need to pay attention to that but yeah you're absolutely right it's it this was the stock got ahead of itself more than anything else seventy year you own Amazon right I do I do and it definitely did not feel good today because it is one of my larger position people have looked a long time for an opportunity for a pullback in this name and I think and I think it is an opportunity quite frankly I mean you had a lot of ways to win retail AWS advertising I think is undepreciated margins they just showed us really good margins last quarter so you had operating leverage as well so the one hard part about Amazon is how to value it but I'm looking at their total addressable market and I actually think that there's a lot that they have in terms of growth and and there are things and in markets we don't even know that they're going to be involved in so they're going to continue to to evolve over time down 6% today dan Niles thank you for jumping on the line it's from alpha-1 Capital Partners the selling ongoing here in the after-hours session check out three ETFs that track the major averages QQQ which tracks the Nasdaq 100 is down it looks like a little more than half a percent sp500 ETF also lower by half a percent and the Dow ETF also trading lower by that amount not sure if that's any sort of tell I guess we have to see how foreign markets start to open it's a little bit of a follow through and usually foreign markets are going to take a lead more from what New York did than anything else so but not not tremendous moves in the context of where we were all day we should also warn that we should expect Asia to open down but the selling happened in a much more pronounced way in the afternoon in European trade the likes of the Nikkei this early this morning Hong Kong was slightly higher so I guess we shouldn't be terrified when we see Asia opened down it's definitely going are you watching for cue Stephanie well tomorrow I want to see initial claims because I got really excited last week initial claims was the start of I thought why rates actually jumped a little bit higher right on the margin at rates we're on they're on their way anyway the day before ADP and then the initial claim so I want to see initial claims I think I expect them to be very good I don't know if it's gonna matter tomorrow it's not a huge kind of a number but it's also indicative of how strong jobs are growing wages are slowly rising in a good way and again it supports a very good consumer which is a big bulk of our economy and also manufacturing is doing well so I mean I you know I said I'm not whistling past the graveyard I get it that we rose really fast and we are at levels where people are uncomfortable because we are seeing higher rates and what are you kind of multiple you're gonna pay for that but again I think earnings are gonna bail us out we just got to be patient over the next couple of days we'll wait for the numbers both on earnings and the economy as Stephanie mentioned shares of construction company floor are plunging after hours Seema Modi with the details on that one Seema yeah take a look at the chart Sara shares a floor down about 12% after hours after the company warned on revenue the stock is down again another 12 percent right now an extended trade this comes after the company reported disappointing earnings back in May and we did see the stock fall then as well this is an industrial engineering name and this warning from floor comes after PPG issued weak earnings guidance just a couple of days ago the conference claw for floor will be at 5:30 p.m. Eastern will be on that call to get a sense as to why it's guiding lower for revenue and its earnings are expected to come out on November 1st more to come back to you Mike if we saw more of these types of warnings it would spook the market yeah I think you're seeing a little bit of a buildup of these one-off announcements up there florescent obviously a particular industry right it's just not they're not building houses and strip malls right these are massive projects so it's it's very long dated contracts and lots of cost stuff so I don't know Stephanie Lee I mean I would say extrapolate much no no I wouldn't yeah they are very volatile as to your point and in this company in this sector tends to be no backlog so actually I want to hear what they have to say about backlog on their conference call at 5:30 but these guys are at the very end of the spectrum in terms of the energy and mining exposure and it's a very high beta way to play energy and mining if you expect that the commodities to rise and so people have started to get interested myself included Jacobs engineering jec that's a name that I'm looking at if that were to fall in sympathy with Fleur that I think is uninteresting buying opportunity cuz they just have a much more diversified mix well you talked about energy we're gonna continue to go through the sector by sector damage here and talk energy in particular one of the worst performing groups today amid the big market sell-off finishing lower by about three and a half percent joining us to discuss is John Hofmeister former president of Shell Oil Company John thanks so much for joining us I mean what is your take at the moment in terms of where we are with broader oil prices and whether they can maintain the recent highs well I think we are in an overall rising trend but that doesn't mean there won't be dips I see today as a dip and probably driven by the size of the sell-off where some of the traders would worry about future growth but underneath it all and I come from an operating perspective rather than a trading perspective but underneath of it all there's a four-year gap in spending capital on the industry to replace reserves or to grow reserves and we know that in the shale formations in particular there's a rapid decline in in what oil we produce so I'm a bit worried given that four-year history of how we maintain growth and meet demand in the coming years so I'm I'm on the side of rising prices over the next say year year and a half where where as some people are saying we could touch a hundred I'm not sure I'm there yet but I'm certainly in the eighty range and and above so I think today is a dip we shouldn't read too much into it and where are you on what kind of economic impact that would have John there's sort of a debate about obviously it's not good for the consumer paying higher gas prices but as Kevin Hassett from the White House told swag box this morning doesn't have that kind of a negative effect on our economy anymore because we're such a big oil producer well except from the consumers pocketbooks standpoint it does if we get much above three dollars and fifty cents for a gallon of gasoline or if we get up into that range for diesel people are going to start to push back and we're going to start to see some demand destruction where we really see the demand destruction is when it hits the $4 range that's when consumers and that's when freight moving companies tackle on surcharges all the prices go up suddenly you know the consumer is is really in a twist from an EP standpoint and the exploration and production standpoint the the comment from the White House is absolutely correct the rising price is actually fueling more investment fueling more growth and with the shale formations and so forth but I'd look at it not only the upstream portion of the business but also the downstream portion of the business and they kind of come together when when you're looking at the macro numbers of how much growth and demand there is or how much destruction of demand there is and it all plays out ultimately in the oil price Jon in terms of we were talked to Kevin O'Leary earlier who said now is the time to own dividend-paying stocks are you confident that those big dividends the yields are sustainable for the likes of Exxon Chevron or your former employers shell over in Europe and BP where in fact their yields are even higher still yes and I can tell you from an industry perspective when it comes to dividend policy there's always a multi-year outlook on dividend policy and it's always looked at in terms of low price medium price high price scenarios so that no company is going to commit itself because it is a dividend driven kind of investment marketplace no company's going to commit itself to a dividend policy where in the next year or year and a half they might have to relook at it they'd rather have a consistent steady dividend policy because they're attracting shareholders that are more in it for the long term this industry is not for day traders it is not for the short term minded individual because the projects are long-term the investments are long term both the upstream and the downstream so it's very important for investors to really lock in and go for a dividend policy they like and if their share appreciation on top of that that's all to the good John thanks so much for joining us John Hofmeister for the present off shell the Dow fell 831 points today Nike Microsoft visa biggest losers after that big plunge in the blue chips is today's sell-off creating a buying opportunity joining us Sam BC contributor from far Miller in Washington Michael Farr as well as point view wealth management John Patrese who joins us by phone Michael Farr you take the opportunity to buy or wait to see what comes next wait to see what comes next you know the old don't try to catch a falling knife it looks like this continue this after-hours selling that's continuing and in this bit of a pullback maybe this is the beginning of the correction we've been waiting for for a long time Sarah we have to wait and see but today was clearly a risk off trade Nasdaq well underperformed the Dow Jones Industrial Average after we had kind of a weak three-year and ten-year auction everybody's taking the Fed seriously now they're gonna continue to raise rates why up until now they haven't I don't know Wall Street does that but we seem to be looking to those higher rates stocks seem to be taking let some of the steam out now stocks go down at times it looks like this has farther to go it's on the same question to you yeah so I think you know you should be preparing your your buying lists and using this opportunity to go out there and buy good value companies and I do believe this may not be the start of a correction but if it's definitely the rotation of out of growth and India value let's not forget growth has destroyed value from a style standpoint over the last five years and you're seeing some of the air take it out it or some of the wind kink another sales of gross with tech rolling over big-time today John I guess the question would be if not just because of the fact that growth has outperformed value buy so much but it we at that point economically where it seems like value should start to work so many of those sectors are you know beneficiaries have kind of more of an early cycle a type environment alright so I mean it's all a function of where its value today and what are you what are you willing to pay for future cash flows and I think that there's significant value out there you know one name in particular is AT&T you know we all know the deal it transformative deal that eighteen T is done by taking on Time Warner but you get a six percent dividend yield for this company trading it you know ten times earnings so you know I think a lot of you know concern is already baked into the cake for a company like AT&T and I think that's a great way to start and picking up some value and today Michael where do you stand on the growth versus value debate and what are you buying yeah you know I've been talking about that for a while Sarah Anne was talking at vien at the beginning of the year that if you're going to try and hit them where they ain't you have to look at some of those value stocks that underperform so woeful II last year and again that's follow through to this year to make sure that system they're there in real balance sheets and earnings with the companies that you own but I would actually caution investors to give this thing a little bit of patience markets go down and being really too quick on the draw for the patient long-term investor I don't think makes a lot of sense when stocks start to roll over let's see where this goes if you're a long-term investor you shouldn't be changing your investments on any sort of a day-to-day or inner day basis anyway depending on where the market is so be patient I agree to have a bias but I think you can be patient just wait to see this thing out I wouldn't be too eager to rush back anywhere now though I I stay long all the time and I'm happy with the stocks I own ok guys we'll leave it there thanks very much Michael Farr and John for treaty's Michael Santoli yes tomorrow morning key things to watch out for I mean I don't think you want to see much acceleration to the downside overnight the futures did not open weld this afternoon I do think you want to see certain divergences start to perhaps rise equal waited S&P 500 which had lagged forever outperformed the SP so basically was this kind of the the big headline indexes kind of belatedly succumbing to gravity when most stocks had already been down for a while so we'll see if is a reversal less than 30 seconds what are you watching which sectors guard to outperform relative or absolute today it was banks today it was health care and staples not so crazy about staples leading the way but I will take banks in health care those are sectors I still like and I would be buying those on weakness which is your top bank my top bank is have so many of them Goldman Sachs ok oh interesting I'm just gonna say before tomorrow watch Mad Money tonight Jim turn cautious yesterday for the first time in a long time that was a good call it was indeed he timed that right you don't want to miss Mad Money you also don't want to miss Fast Money which begins right now [Music] fast money starts right now with breaking news stocks gettin shattered today the Dow having its worst day since February tanking more than 800 points is selling accelerating into the clothes and we close up the dead lows of the day S&P 500 now having its worst losing streak in two years and take a look at the sea of red on Wall Street the market took no prisoners tap getting hit the hardest down nearly 5 percent the Nasdaq falling a whopping 4 percent having its worst stage since Briggs it everything from transports and small caps taking on the chin 66 percent of the S&P 500 closed in correction territory or worse it was a wild day out there as it looks like we are finally seeing some panic set in to the market so are things going to get worse before they get better is this a dip you buy what do you do well I think the good news is we're right on the cusp of earnings season we sort of talked about that last night I'm not going to suggest that I knew the Dow was to be down 800 points today but we have mentioned the warning signs have been there the market just hasn't cared until today what are those warning signs well technology absolutely has been rolling over quite frankly it started with Facebook a couple months going with down 23% in seven minutes we talked about how an individual stock can do that who's to say the broader market can't do that the Small Cap index has been going lower transports have been starting to roll over I'm of the belief that this whole thing with China is not going to get settled anytime soon I think that's been a problem mr. minuchin today said China dholtze don't continue to devalue currency I think that was a factor finally though the market seemed to care that's the bad news the good news as I said we're on the cusp of an earnings season that I think will be strong my concern will be what will guidance be in the wake of a lot of these pre announcements we've seen over let me get my backpack that was the reason earnings were coming up right by that black you had a black out so maybe you get them to help the heavy lifting but I think today was technicals it wasn't fundamentals if you look back in January February similar but we ran up a lot more prior to January so I think all things being equal will right around support levels in the market the 200-day earning season I mean guy to mention TPG right during today that's the problem we have right so if we had to have those earnings warnings and flower corp after the close today earnings warnings there so if we didn't have then you might look at this and say okay maybe this is an opportunity to buy the dip for the longer rod I'm not clear on that now I do think in the very short term you see a day like this dows down 800 points this is not the day the panic this is the day to start looking at hey wait a second as a trader maybe I want to pick this up so what I'm looking for and maybe it happens tomorrow you wake up Dow is down to 300 points and futures in the morning and then you get that reversal that to me would be very positive and I and I would be buying that I agree completely I think I mean we're I think a little bit further down now clearly markets overseas are gonna open down europe's gonna do poorly tomorrow and will probably open down to i I'm sort of intrigued by this I always say that when things start to trade down and integers at a time something else is going on and that's appealing to me I mean you know today I got trampled by that thundering herd of integers going down but I don't I don't think that things have changed that much fundamentally in terms of how the US economy is doing and I think we're gonna see good earnings I hear G's pointed it's a good one about it's not just the earnings it's about the guidance but now the bar is lower for earnings right it's right significantly lower in many cases for earnings but remember we we talked about in January February we heard about risk parity accounts that no one understands the CTA's that no one understands gamma that no one understands it felt like that integers was part of that so I don't think it's something it's tangible I which makes it more Bible to me so it runs its course okay you D leverage you be risk so once you get to a certain level it becomes a screaming buyback and then it evens out a little bit the 43 percent spike involved that we saw today I mean if you were to believe that their risk parity accounts at work etc and all that's going on then that was one of your catalysts right and so all those things are reason why you want to start looking to buy this market potentially rather than panicking here and trying to buy puts with ball spiking like that this is to grasses point kind of a technical mechanical part of the market that doesn't mean we can't go low it doesn't mean that the economy might be slowing or not but the very short-term there's gonna be a tradable opportunity here here is my question I'm sure the home gamers thinking the same question because we have very astute viewers out there you're thinking what does this market sell-off tell us are there questions about the US economy to Karen's point I mean when you when you take a look under the hood of the markets right we lost Fang what back in June the average small cap stock was down 6% or more than that in the month of October down 20% from there 52-week highs we have all sorts of growth indicating the growth stock areas really falling off so didn't that tell us early on that there questions about growth and then we got all these warnings questiony were there questions about growth without question however I mean you talk about a US economy that has historically low unemployment rates optimism is through the roof profit margins until recently have been spiking so all those things headwinds man-made had wins exam of tariffs in the form of higher orders which we're doing or a lot of it is self-inflicted that President Trump might be right the Chinese might be absolutely ripping us off intellectual property wise and in terms of trade there's no question about that I have no idea I don't sit on those meetings but to think there's not going to be a ramification for the broader market on the back of that is full just have those worries though we've got meters now it hasn't care to it right and all the fundamentals that you just started naming have been positive they've been tailwind to the overall economy that's why it just seems to me that it's a more deleveraging risk-off type trade based on things that have been around there for quite some time I'm gonna cast myself in the role that Debbie Downer tonight though because we have not we have not seen the impact of the latest round of tariffs that we're only getting with so that now with these warnings and so every single indicator that you point to when you look at powder-coated policies that we've analyzed the data points and we haven't seen it take hold in the data points as of yet he's got a you tell that factoring a tip Procter & Gamble you tell that to Pepsi there's there's a reason why it's in these certain aspects and that could be transit or all the motion watch a transitory is the right point here right everybody in the market or at least the narrative of the market has been listen these tariffs are gonna be temporary we're gonna win this trade war it's going to be better coming out the other side yesterday the IMF comes out and says hey wait a second maybe not now we're starting to get Ernie's warnings companies are saying things might be slowing down these terrorists might be hurting if you think that the terrorists are going to go away relatively soon let's call it the next quarter then yes this is a longer term buying opportunity but I'm not that clear on that it doesn't seem to me that these are gonna go away that click so I think you have to be more of a trainer much more nimble in this but also just well I'm sorry one more thing when I'm trading on the floor today what I didn't like was that everyone said let's just get the sell-off over with as if it's a reset where you have a sell-off and everyone's back in place and you're guaranteed another bull market that to me speaks to the complacency that we've seen in this marketplace you know here there are a lot of talk about the Fed is derail in this but you everything you mentioned I mean there is inflation president Trump said we have inflation in in control I'm not certain that's the case I mean and everything we've seen Pepsi floor Corp you just talked about Proctor and Gamble PPG I mean they're seeing inflation somewhere it's clearly Koster going higher the Fed is doing everything right I'll say this though and I don't know if people would agree if the Fed flinches in December because of what potentially could be a market sell-off doesn't go even in light of this off in light of this off you still want the Fed to markets down the S&P is down 5% from an all the credibility they need to for the feds credibility they need to stay market responds to a Fed rate hike at this point because we're rebounce back and we're at the highs again and the Fed raises rates then I think you've got a problem if we're at the lows and we've priced in this December hike then you know why did the supplier it started with Powell's comments October 2nd in the comments October 3rd we start to fall off a cliff this is all generated by Powell which was a risk off event if he backs off everyone thought he was hawkish so to your question if he backs off it is double has to be the inverse of what we've seen already why the market has to be bought you couldn't look at it as all right the Fed really they didn't want to leave this path but they have to things are so bad I think they'll stand up I think I think what he was saying is we can overshoot a little bit based on inflation then that no one could explain why we haven't seen it we see pockets of it so here's a question though if you see inflation and you say Oh inflation in the economy is a good thing for the right reasons the economic growth what if you see inflation in the economy and it's man-made inflation it's self-inflicted elation brought on by tariffs brought on by higher oil prices because of sanctions on Iran is that casino not inflate and on and on top of that question they have to then think about the market implications they've have themselves a job that's already impossible then is extraordinarily impossible they can't try to navigate a market in this environment they can't stick the market landing and try to raise rates and try to think about everything that you just said it's impossible I think they got to raise rates I agree and I think just step back historically look at rates are look at this quarter point that we're talking about I mean really I said so much bigger I agree but the path from three percent to three and a quarter percent on the 10-year the volatility but what you have to look at for the Fed is remember we're talking about inflation their main indicators flash and inflation expectations and that hasn't picked up at all so if I'm the Fed and I'm looking at this and I say you know what if I don't raise I lose credibility cuz the market fell down all the indicators I see as a Fed no inflation expectations why would I not why would I get off the path of raising hikes at this point so I think they do go I think that is going to be a headwind for the market but in the short term you might get this tradable bouncier all right well despite today is a major sell-off our next guest sees a year-end rally shaping up says to buy the dip for more on that let's bring in a fund strats Tom Lee this is the dip that you buy yes you know it's a dip where the VIX has spiked we've had a basically a waterfall collapse and we know that we're going into this period where 74 percent of active managers are trailing their benchmark so I think that the urgency or the urge for markets is really to put capital work to sort of close performance which means a rally do you think that the declines that we saw in the markets today are really as bad as they seem on paper when you take into consideration at the role that ETFs are playing in these markets and that you're selling when you sell three of the ETF's that you probably own you're selling the same stocks over and over and over again yeah I mean there's a there was a big correlation increased today across markets and part of it is that there is deleveraging when rates are high and when volatility spiking and we know risk parity funds were overweight bonds so I think this is a lot of position squaring but once this is behind us I think people have to think about where opportunities are especially under inflation and equities really are the place to be so Tom I know you do a lot of quantitative work and that's been fantastic this year what are your quantitative models saying about this let's take the emotion out of it what are the machines set so you know quant funds almost universally like growth and even our quantum model by Sam doctors overweight growth so one of the things that is crowded today's people are long-duration either in credit right through bonds or through growth stocks which are long-duration assets so a shift towards higher rates is a shift towards acid intensity you want to be long assets not duration which means you want to possibly think about Odin owning growth value stocks now how are assets so you know stocks are assets study I don't know what's what you're saying but so the adage used to be that it's harder to make a lot of e to offset PE so meaning in a world of rising inflation an asset intensive business like financials can generate tons of earnings leverage because assets are growing they're deleveraging plus they can earn margin if you're an asset like company like an rnd based company it's tough to actually keep up with inflation because you have labor costs and the only thing you have is units growing for you so asset based businesses are valued getting back to by the tip so I'll play devil's advocate the S&P is down 5% from an all-time high albeit three of those percentage points worth today what needs to change in order for it to be from by the dipped and maybe this is the beginning of something larger well the one metric we watch very carefully is the yield curve because you can't fight against an inverted yield curve that tells you confidence of the future has gotten so bad that markets are contractionary the curve has been steepening actually in this sell-off so I actually find that pretty bullish that we've had sort of future expectations improving so I'll pick you back that you said risk parity the last time we had this risk parity event we were trading down between 11 and 12 percent so guy had said it's down 6% 3% today basically what is it a technical bounce or is a numerical percentage that we're coming off of for risk parity because risk parity has to be somewhat the same linear misen sum it so and we've seen the market run up Brandi we haven't run up that much is it a percentage basis or a technical it's it's probably little bit of both his wrist parity is gonna want to overweight low vol and underweight high ball and equities relative fall at 20 is actually you know it's a spike but it's actually relatively low vol so I think equities sort of get an allocation but you might remember the seasonals are really good I mean you know the correction happening let's say in May or summer is scary because we have bad seasonal now we have good seasonals at a time when there's performance chasing so I actually think it's a good opportunity here the last question I want to underscore the message that you're sending to viewers right now and that is you buy the dip but you want to buy the value stocks going to your end that's where the rally is going to be or is this gonna be a broad-based rally with the same old players playing along the fang stocks the tech stocks yes so I have two frames I think into year-end I think people go back to their favorites on their shelf so all these Fang names that have pulled back look really cheap because they probably wanted to buy them at these levels or you know PayPal in the 70s but next year I think it's a story of markets are broader it's really narrow this year and it's more asset based which is inflation inflation traits and it's probably a shift to value I mean that's one of it I think the more important moments that's happening this year Tom good to see you thank ya great to see you guys only a fun strat do you buy Tom's market playbook I'm a little listen I'm always a half empty person so I mean I'd love to be optimistic I'm by definition I'm not so I do believe this is beginning of some now I'm not saying 20% but anywhere from 12 to 15% given the double tops we made to Steve's technical point the S&P I think there's more pain to come all right still ahead we are all over this market so often we've got to cover it on every angle after a wild day on Wall Street first up it was a sea of red on the street but despite the pain there were a number of bright spots amid the chaos will tell you what they are what it could mean for the markets plus tech the big loser today down nearly 5% as the market leaders continue to get sold the hardest but a top technician says there is opportunity amid the chaos he'll tell us the beaten down tech names he is buying right now we're live from Times Square in New York City much more fast money right after this a perfect Tim you'll never know from the outside that's why we go beyond the gifts and glamor of automobiles to give you the real picture good bad or ugly because we know that to really appreciate your car you have to go beyond her surface Beauty overdrive India's most authoritative guide to automobiles at these times [Music] only on CNBC tv18 am CNBC tv18 calm one hour that's all it takes to decode the markets and macros one hour that is really all it takes to understand about policy and policies one hour is what we use to give you stories of global significance one hour is all you need to get insightful in depth but everything join me serene ban on India's most comprehensive and award-winning news to India business hour at these times on CNBC tv18 and CNBC tv18 calm brought to you by 99 acres calm India's number one property portal and theorems come home to see arounds we get you all the buzz in the commodity market the commodity champions at these times only on CNBC tv18 bombarded by news all day long separate the Muse from the noise with a 30-minute insight into the most important news stories of the day what's heart at these times only on CNBC tv18 at CNBC tv18 calm what brought to you by orient led ExxonMobil energy lives here and status to you how much what a choppy day in the market bulls are still winning the battle so to be the market could have easily fallen a lot today's critical last 1 hour anyways extremely volatile day of trade what's the market bass today the budget nifty can actually double to 20,000 levels over the next five years times of it interactive actually a twitter user wants to know if it's a good time to invest because here's a clearly from a domestic focus rally we are now moving to mobile till then to find out what could make or break your trades NSE closing bell at these times on CNBC tv18 you one hour that's all it takes to decode the markets and macros one hour that is really all it takes to understand about policy and policies one hour is what we use to give you stories of global significance one hour is all you need to get insightful in-depth and accurate information but everything that you need them join me serene ban on India's most comprehensive and award-winning news to India business hour at these times on CNBC tv18 and CNBC tv18 calm brought to you by 99 acres calm India's number one property portal and theorems come home to see around we get you all the buzz in the commodity market the commodity champions at these times only on CNBC tv18 barded by news all day long separate the Muse from the noise with a 30-minute insight into the most important new stories of the day what's hot at these times only on CNBC tv18 at CNBC tv18 calm what brought to you by orient led ExxonMobil energy lives here and status to you a [Music] perfect Tim you'll never know from the outside that's why we go beyond the glitz and glamour of automobiles to give you the real picture good bad or ugly because we know that to really appreciate your car you have to go beyond her surface beauty overdrive India's most authoritative guide to automobiles at these times only on CNBC tv18 and CNBC tv18 calm at car you bombarded by news all day long separate the Muse from the noise with a 30-minute insight into the most important new stories of the day what's heart at these times only on CNBC tv18 and CNBC tv18 calm brought to you by orient LED Exxon Mobil energy lives here and status to you a perfect team you'll never know from the outside that's why we go beyond the debts and glamor of automobiles to give you the real picture good bad or ugly because we know that you really appreciate your car you have to go beyond the surface beauty overdrive India's most authoritative guide to automobiles at these times [Music] only on CNBC tv18 an CNBC tv18 calm one hour that's all it takes to decode the market and macros one hour that's really all it takes to understand about policy and policies one hour is what we use to give you stories of global significance one hour is all you need to get insightful in-depth and accurate information but everything that you need them join me serene ban on India's most comprehensive and award-winning news to India business hour at these times on CNBC tv18 and CNBC tv18 calm brought to you by 99 acres calm India's number one property portal and theorems come home to see around we get on the bus in the commodity market the commodity champion only on CNBC tv18 brought to you by SBI life messy Hancock Adam Exxon Mobil energy lives here and yes back India bully yes and I might have you you keeping pace with every minute is tough that's why we bring you a comprehensive bigoted rap in Phi Beta people need to know it's smart investment decisions in just mbc TV team.com today to you by yes back moly yes one hour that's all it takes to decode pockets and macros one hour that is reality to understand about policy and policy one hour join me serene ban on energy most comprehensive and award-winning news so india business hour at these times on CNBC tv18 and CNBC tv18 calm brought to you by 99 acres of number one property portal and csgo to see around [Music] a perfect you'll never know from the outside that's why we go beyond the gifts and glamor of automobiles to give you the real picture good bad or ugly because we know that you really appreciate your car you have to go beyond the surface Beauty overdrive India's most authoritative guide to automobiles at these times only on CNBC tv18 an CNBC tv18 calm every morning on CNBC tv18 s bizarre morning core data is transformed into expert insights to drive decision-making any market moves because of liquidity the agent screen is green the market has done remarkably well stocks expected to be under pressure today the market is heading up for policymakers Peters the first channel I put on is CNBC tv18 because I want to know the business news from minute by minute analysis to expert inputs and global views you get the news before it hits the trading floor bizarre morning call at these times only on CNBC tv18 week you let's talk about today's action major implication for so many of these companies we're wondering whether earnings season is poised to slam Wall Street closed Edo [Music] all up for the show you may have seen the news what stocks move on that what is Kramer think you just don't know what's gonna come at you you're gonna have to listen I'm gonna tell you which stocks are gonna go higher and which ones are gonna go lower I like to try to figure out ways to make you money it's important to respond quickly but it's more important to get it right we do it better anybody else cuz we live and breathe it in the first couple hours of trading the world moves you cannot do it without what we're saying you will not be a sucker if you watch squawk on the street I'm probably the first person to walk on the floor every day and it's empty and I have this moment Wow one of the greatest experiences for me when I first came here was walking down the West Side Highway and seeing the Statue of Liberty and that's when I fell in love with New York where I come from in the UK the confrontational style is the way in which we have brought cast sometimes you just can't let people get away with things that might possibly mislead the audience every day you go home and you can how do I make it better tomorrow CNBC explains CNBC explains everything from futures back relations futures market is in backwardation to put call parity put with the appropriate strike price from quantitative easing to currency bags now in this situation think of it like a chalk talk for the financially savvy that breaks it all down because on this playing field of knowing your X's and O's makes dollars and cents CNBC explains now on CNBC calm this is TV 80 and you're watching CNBC tv18 you

Channel: CNBC-TV18

Views: 892,099

Keywords: CNBC, CNBCTV18, stock market, stock market news, share market, business news, indian share market news, indian stock market news, stock market live india, cnbc tv 18 live, share market live, stock market live, finance news live, stock news live, nifty live, cnbc tv18 live tv, cnbc tv18 live tv today, english news live, business news live, news republic india, breaking news, closing bell, market live, bear market, nifty 50, nifty trading, sensex trading

Id: PWpDCLZQfxQ

Length: 182min 9sec (10929 seconds)

Published: Wed Oct 10 2018