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As for casino stocks, I received an interesting note today from a Morgan Stanley analyst from the gaming conference in Las Vegas talking about rising rates and that industry experts are arguing that rates could actually be Good for gaming because retirees get more disposable income with rising rates. their fixed income and may choose to go to the casinos and deposit more money, think about discretionary consumption and if you have people with a little more disposable income on their side that could benefit, in those cases those older people generally have lower debt , so in other words, they don't have a lot of open credit card balances or floating rate debt or whatever.

I don't remember we did a segment last week. I forgot it was a day you were here, but I know you were. We just did a segment. about cash we did a segment on CNN, that's probably the first time in ten years that we've done a segment for so long that we heard Jim Cramer talk today about how, in 1987, it went back to all cash: that's something that's new for me to hear the repeated bell of cash, cash, cash, but something to consider, yes, some key levels that they were looking at until this close 28:22 on the S&P 500, which is a 100-day moving average, one close below which could indicate a breakup.

We are currently below that, but we remain close to that line and we will watch it very carefully as we are down over 2% on that index and thanks for watching Power Lunch, a very busy close. closing time or the bell starts right now, Tyler, thank you very much, good afternoon, welcome to the closing bell. I'm Wilford Cross, I'm Sara Eisen instead of Kelly Evans and it's been a wild day on Wall Street, just like all of you. let's know, let's take a look at what the indices are doing with just one hour left, trade with a drop of exactly two percent in the Dow in terms of points, that's a drop of 527, the lower the session went, 569 , high up 11, feels like a long A while ago, early in the morning, the SPS fell a little over 2%, the Nasdaq fell over two and a half percent, some brutal drops for stocks, which It's interesting how cross currents are right now, we have to look at bonds, we also have to look at the dollar.

The 10-year Treasury yield has been a big source of angst for the stock market lately 3 22 so, hovering around that 11-year high as far as bond yields go, you see along the curve the 2-year rise At 10-year highs, 30-year highs, and multi-year highs, we've been a little higher earlier in the session, as you can see, but the rise in bond yields was also meant to signal to the US dollar being weaker today its interesting that bonds, dollar and stocks are selling off together usually stocks sell off big 500 points down and you rush to safety like the dollar or the Treasury Treasury, so there is a little bit of a different correlation in a different feeling that might suggest not a loud panic, but it might also be a redefinition of what is safe in this type of environment, the movement in the Today's returns, those small relative values ​​mean that yes, we are reaching those types of records. but the movement has been small in recent days compared to that of stocks, which is certainly the steepest day of decline, but it doesn't get up, it doesn't get a break and that could be part of the problem.

We have a lot to talk about here. hour we will talk about the technological decline that is what is dragging this market down alpha-1 capitals Dan Niles will join us what he says is the biggest threat to the sector since Melissa is only 20 percent away from the Netflix highs at a ten percent discount the highs for Amazon and whether the sell-off is just beginning or the beginning of a larger pullback, we will also speak during the program with Allianz chief economic advisor Mohamed el-erian, who has shown himself relatively optimistic about the growth recently undergoing flowering. Right, exactly on the global side, so we look forward to talking to him and all of our guests, but first let's talk to our reporters who follow the market action.

Bertha Coombs entered the Nasdaq with what is driving the fall of technology and Papasan is here with the key. things investors should watch ahead of earnings season, but let's start with you, that's precisely the problem here, we're ahead of earnings season, so there really won't be companies coming and rushing to give you terribly good

news

or go against the trend. Feeling like companies aren't going to buy their stock before earnings either, so that's part of the problem. What we are seeing is much higher than normal volume in the tech cells, indicating that there is more conviction in this sell. today and it is being led particularly by the chip sector which has now fallen five days in a row, it is about 15% below the highs and we see the words daily decline for this chip sector since June 25th which was also when we saw that big downdraft. in the S&P 500 among the big volume losers today the large caps that are dragging things down the usual suspects are there Netflix Amazon as well as Microsoft these have been big winners for the most part if you take a look Netflix is ​​still up 73 percent so far this year, even with this big drop that we've seen lately, the big pullback is a different story for Facebook, which doesn't trade on this high volume like some of those others, but Facebook is one of those names of fans that fell early with all the privacy issues and is now down about 30 percent from its peak and 12 percent so far this year, while the others have held on to the gains.

Some of the stocks that are actually bucking the current trend. few and far between, only about 10 percent of the $100 Nasdaq tree and several retailers today are getting some love, but some of them, like X ray, are actually just bouncing off new lows, so there is not much positive movement. Here for you to find, but thank you very much for that. Now, will earnings season be a catalyst to turn the market around? Rambabu is sunny, take a look at that, hey, hey, willful, we start on Friday covering your sector, of which your banks are part of the The problem that the markets are having and, although we are down today, part of it is that The outlook for earnings season is much more complicated than it was just three and certainly six months ago, let's look at some of the number one issues and most importantly, we're dealing with higher rates but higher costs.

We have also talked about higher raw materials because Amazon increases wages. We will hear about higher wage costs perhaps in 2019 and they are trying to realize that we have weakened as well. Foreign currencies that may be affecting some large multinational companies, we will hear about that of course, we have been talking about tariffs and there are prospects of weaker demand from China. We have heard that in some of these sectors, such as the automotive sector in general. 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 performance and in that environment growth was bought at any cost and technology was bought.

Stocks are different now, we're getting higher growth and we're getting higher returns, technology is a little bit out of fashion, but what's in, well, Treasuries are starting to look a little more attractive again, stocks, that's one of the main reasons why the markets had a setback in the last week or so and value is starting to beat growth, it's an old story that we've talked about for a long time, but There are some signs that this story is getting a little more complicated, for example, let me show you what the market leaders have been. We've been talking about all these stocks that are below their 52-week highs.

How many have 20%? Often, that is true. There are some tech and industrial stocks at 20% off, but market leaders are still holding up healthcare and utilities. commodities are just three four five percent way up, 52 week highs, not that high at the beginning 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 are Some signs that this value story is getting a little more complicated. We're going to hear a very complicated story here about earnings from Friday for you and Bob, you know, while we're still waiting for the big guys, including the banks.

You mentioned that what we have gotten so far has not been so optimistic. I'm thinking about Pepsi a few weeks ago, warning about higher freight costs, warning about the impact of a strong dollar on profits. PPG, yes, they fast and everything, I mean these. They're names we don't really talk about much, but that's an industrial supplier, you know, and they were all warning about tariffs and rising costs, yeah, not so good, that's true, and Micron also talked about the impact of tariffs, did not place particular emphasis. a number and that has been part of the problem, no one has been able to specify the impact we are having.

I think you're going to hear about all of those issues, we talked a little bit more and I think that's what the markets are doing. is in the process of correcting that uncertainty, if you understand that you can see it, remember something, although the market, the economy in general is still very, very strong and I think the important thing that people need to keep in mind is that the growth of the revenue will be very very high, so when you have a two or three percent increase in costs and your revenue increases by seven or eight percent, Sarah, you have a lot of room to keep your margins high and I think that will be one of the things to really help market revenue growth remain strong, yeah, look, we'll see what the margins and guidance look like Bob, thank you.

You join our closing bell exchange now to discuss more about today's big market sell-off. We have Chris Cordero here. from the Atlantic region Tony Chris NZ from pemko Matthew Chess Locke from Virtu Financial and Rick Santelli from the CME Group in Chicago Tony, this move in bond yields sheds light on what the main driver is and continues well. The reversal of gray trade we have seen since 2018 is clear. As proof that some cyclical will bring work back to the US economy and US financial markets by cyclical allocation we would refer, of course, to some of these late cycle dynamics that Bob Pisani just talked about and that They lead to pressures and a breakdown in the correlation between assets.

It's not as easy to hedge stocks against risk and just use bonds right now, but we suggest, however, that most of the rate hikes that are likely to be seen have already been seen, that the so-called new neutral for the political race global en In other words, we are likely to see low policy rates in Europe, Japan and even the United States, but what will happen over the next year, the bottom line is that there will be a decision point by bond investors where They're going to have to decide what we write about this idea of ​​a 2 and 3/4 funds rate for cycle N of fed rate hikes, the market decides it's wrong and decides on a level of three or three and a quarter percent. , yields will move concomitantly Li, but they are already in a zone to suggest that the three three and a quarter percent rate could be managed within a year Matt, what has everyone in the room been saying?

I mean, the rate hasn't skyrocketed today, it's been rising quite a bit. in recent weeks why today we often exceed two percent. I think it's just a perpetuation of things we've seen. This is not a trading opportunity at least from our point of view, but I don't see anyone here rushing to buy shares. I think so. We are expecting a bit more of a pullback, but we are trying to see the other cross currents that are happening in this market. We don't see anyone rushing towards the target. This may be a security or utility play, so this market yet. has a little bit of room to the downside yet before we start to really get into it and start buying it S&P and Dow are down three and a half percent from their recent highs Nasdaq is down about six and a half 77236 what you need to see, so stop buying Again I mean, look what happened, look what happened in China and stuff, when we started talking about these trade tariffs or you know China really got hit, we really weren't too far behind, so we needed confirmation ofwhere we are at that point and I still don't think we'll see, yeah, we don't see that crescendo towards the sales side, we want to see that volume go up and actually go down a little bit.

It will be painful perhaps in the short term, but it provides a buying opportunity. opportunity Chris, is it a buying opportunity? Are you taking advantage of this opportunity to buy? price is what matters and that's what we're starting to see in this market right now: valuations and earnings are what matter and that's all a long-term investor should care about. Rick, you're like the alphabet for that reason. like the alpha value, I actually like Intel, especially today, if you look at it's easy to do, they are selling at 11 PE, which gives you an earnings yield of around nine percent, so you can see the value of having profits that they only need to grow. a little bit and you're looking at a double-digit performance, Rick, when you consider the data that we had this morning, does it justify these liquidation inequalities that we've seen today in your eyes and do you take it into account with the auctions and the action? what we are seeing in the bond market no, I don't think the PPI is responsible for this.

Let's put this into perspective on the interest rate side as I look at the two, three, 5/7x and 30 yields, basically, exactly. where they were on Friday we didn't see this type of liquidation activity to the extent that we are on Friday Today I think what is happening is a large part of macroeconomic liquidation, up to maybe even a third of it, and it is easy to understand why Jack Perugian talked about it today. Imagine if you are a Chinese investor, a European investor or a Japanese investor, okay, your economies are bad. fundamentals Europe and Japan have had negative interest rates for years large institutions and investors if they buy into those markets they eventually go bankrupt, so what do they do?

Come here. We have talked about divergence. How does divergence occur? They look at their own. markets there is no opportunity they come here there is a problem when you have large investments here you distort it there is your divergence but you also need to convert well, if you are a European investor you need to convert that income stream and your dollar denominated in Euros, if you are Japanese, you converted them to yen, the problem is that the banking systems in these countries, especially here, are a little weak and these big hedging swaps to cover those swap flows are almost at capacity, it's been that way for a while, don't do it .

I think the International Standards Bank has written a lot about this, so I guess what I'm saying is that there are pressures in the system that could cause positions to be liquidated in the US and the back story is that they could also be it too. to the Federal Reserve and the economics of our economy pushing rates a little bit higher as well as a good explanation and kind of a correlation in this market, Tony, when you see and now we're looking at a six hundred point drop in the Dow Jones . Industrial Average A move like this in stocks there is usually a flight to safety towards the bond market towards the dollar and it is not happening today either.

What does that tell you? It tells you something about where we are in the economic cycle. It is the dynamics of the late cycle where there is this dispersion between assets at the beginning of the cycle two thousand eleven twelve thirteen fourteen it is easy to buy something and simply take beta to credit stocks and earn because one does not need to worry about interest rates, that is not so easy now, so we should be thinking more when investing about risk factors, in other words, there are some stocks that have interest rate risk and some bonds that have stock risk and investors should also think about liquidity risk and volatility risk, so think about taking a risk factor approach now.

It is very important because there will be dispersion in a late cycle, we are at session lows. I should just mention a 633 point drop in the Dow, very quickly Chris and Matt Chris, you mentioned that you like Intel, what don't you like? You're avoiding, well, I think, well, I think what you should avoid are high-priced tech stocks. You know, you should avoid the Amazons of the world. You got it. You have a question on Netflix, where are they really? I'm just trading potential earnings

news

, I want to see real earnings and that's what I think is really going to matter, you know, the other thing I also think we're missing here is inflation, inflation, all the things that Bob mentioned at the beginning. this report are inflationary if you look at trade and tariffs they are going to cause inflation that is putting upward pressure on rates and I think that is why people are not turning to bonds right now it is because they are afraid of let rates go up and you could get hurt I'm not fast I don't know how to make enthusiastic purchases in the moment If there was one sector or stock you would buy right now, what would it be?

I'm going to be very cautious right now. I really think we're going to get more discounts here, you start looking at oil, you know, people would get mad, it got to 65, everyone said it's going to go down, it's going to break down now that it goes up to 75, so they think it's going to go down. to burst again, now it rolls towards the middle. from the range, that's an interesting sector now, I think if we have more selling, you know, you might start to see people investing in oil, and the selling of shares is collecting urine vapor on the clothes Welford, as you mentioned now. all sectors in the SMP have been negative, including utilities that hired practically all day tech, by far the biggest losers, thank you all Chris Cordero 2015 Z man chance Locke and Google Rick Santelli fascinating exchange, we have left 45 minutes to trade and We are close to the session lows, as Sarah mentioned, let's send it to a market look at transports.

Hi Dom, okay Wilfred Sarah, as we talk about what's happening with the market crash, transportation stocks are notable underdogs and are relatively underperforming the rest of the market. Overall, the Dow Jones Transportation market on broader for the Dow or the S&P 500, if you will. take a look at transportation stocks, there are notable parts that are really dragging things down, first of all you have what is happening with railroad stocks, several of those railroad stocks are moving lower and are They are among the worst performers in the CSX index. by the way, the rail sector is having its worst day so far this year, that's a name to watch, also take a look at what's happening with airline stocks because even with higher oil prices low to some extent over the course of the last day or therefore not finding any type of offer, they are caught in this downward current of transportation, as well as railways and airlines, two of the key parties here.

I would also point out to 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 symbol that is now trading at more than double its average daily volume today. It's also worth noting that the Dow Jones Transportation Index has now fallen below its 200-day moving average or longer-term trend. line, it's the first time it's happened since July, so if we take a look at the overall market picture and the narrative that's developing, there are certain key industries and sectors, transportation stocks have been one of the ones that's really been going strong. stand out in parts of this bull run higher now coming off the dips will be something we will be watching for sure in the later parts of this trading session to see whether or not they close at the lower level Wilfred damn thank you very much and we also look forward to the airlines whose reports, of course, tomorrow we're going to dive into the Dow, which briefly went down six hundred and thirty, six hundred and forty points, was the lowest, the session a few minutes ago is now back down to six hundred points, of course. significant sales there are losses in the Dow Jones Nike was down six percent tilting four percent of course very influenced by trade with China for its Microsoft even down significantly 3.9 percent did not have an update at the beginning of the week really not there's a place to hide For now, let's go out and wear saris on the floor with Mike Santoli looking at Tiffany, who is experiencing an even bigger drop today.

Sarah, yes, there are no shortage of losers today, Wilfred, but we arrived at the position where Tiffany negotiates because she is down nine. percent and is part of a broader sell-off of the consumer discretionary sector, especially luxury goods, right now this is happening overnight and there was a catalyst here. LVMH obviously, the huge luxury conglomerate in Europe, warned that China was being stricter with its checks on return travelers. from the border looking at the luxury goods luggage, it's a very 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 The investor is exactly a luxury player and I think it also shows the sensitivity of investors towards exactly those issues, so exposure to Asia was a big bullish talking point for any company a while ago, now it is clearly negative and concerns about you already know, just by seeing Exactly what the friction will be that will affect companies regarding Chinese countermeasures.

All of these things come to a head when you try Tiffany, which is also, by the way, still here today, we're down nine and a half percent, it's still up seven today. percent, so a lot of kinds of gains are accruing to a lot of these consumer names, people who say the economy was great and then it's being undermined right here. I mean, I can't believe I'm mentioning this for the second time. this our patent, all you know, bra distributors, China was an issue and dominated the conference call today and there's some anxiety about this global supply chain and what China is going to do to literally disrupt the practicalities of the world.

In the economy, that's where fashion works, among a lot of other things, and yesterday PPG, so yesterday was kind of the industrial coatings

business

, so I think there's kind of a buildup of concern about what it means not just for third quarter earnings, but also for what it seems like moving forward when you know a little about China and the United States. they kind of go their separate ways in trade right and use different types of weapons right and then in fighting, I mean, we might not have as many imports from China, we might have more imports to reduce taxes and tariffs from China, and they have it, but they have other forms. of making it painful for our economy is much more insulated from trade, but the S&P 500 is not particularly insulated from trade because that shows two different ways that the stock market does not directly reflect the US economy. with Tiffani falling almost 10 percent Wilfred again, okay guys, thank you very much for that, you can see on the Dow chart that we are close to the session lows 2.4 percent for the Dow something similar for the S&P now accumulates a drop of more than three percent 3.1 7% to be Precise, with 40 minutes less of trading, let's look at this a little more and now joining us is Kevin O'Leary, the president and the stock ETFs and or and, in particular, Kevin wants to talk about dividend stocks.

He talks about them in the past. I have strong cash flows, they are an area of ​​the market that you generally like, do you particularly like them in this current big sell-off environment? I really like them in this current environment, in fact, they are starting to outperform because at the end of the day, when you start to think about the success we had in technology over such a long term, infinite long-term assets think that they don't pay dividends, there is training and extremely high peas, they are not necessarily bad stocks, but they tend to really have violent corrections as they are now, on the other hand, you take a really boring balance sheet like a gallon or a Pfizer or a boring AT&T like the Hell, the extremely strong cash flows pay a significant dividend yield significantly higher than the S&P SCC yield, so you can get almost 100 basis points more out of these stocks and they are the ones I tend to favor at times like this because you They pay to wait and you don't know when it's going to hit bottom, in fact that's days like today that's what I buy, you know, I love big indices.

I designed my own, today is a day to get to know each other, it is an index that is full of monstrous and boring balance sheets, big and succulent cash flow companies that tended to be out of favor in recent years.years and suddenly 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've never seen you wear anything but all black and I have a clubbed red scarf and if that's in honor of the red we're seeing on the screens diving into this period, I'm very glad that you saw that and that you realized it because I respect your gaze all the time.

I'm trying to match this red band on this Daytona that has a black element with my suit. I'm really into these fashion things these days, help me, help me. I don't think you know, you shouldn't just throw in an index. but it may be a very fashionable brand. I think it would do very well. I would be your first client. Kevin comes back to the call about a performance stock suit in the way you explain it. It's there either because it pays you while you wait, but the prices of these stocks are expected to fall along with everything else or it's because companies that tend to have higher yields have strong cash flows supporting them.

No, it's about the balance sheet and the quality of the balance sheet because what happens to these stocks when there are violent corrections like the ones we are having now? It's been a long time since we started having violent corrections when you see stocks drop 10% in one day or sectors drop three and four. and five percent, it's been years before we've really seen that and now we're starting to get it and the reason I love stocks that have really strong balance sheets with strong cash flows and distributions is that they tend to correct less in a market valuation when I look at my overall portfolio these are the anchor positions these are the ones that tend to help me perform better during periods of extreme volatility they are boring but they have their place in your portfolio you know when people Tell me oh I never go to buy a boring old thing like a chevron or a Pfizer or Roche those are the ones you love on days like today and that's why they should always be there that you love on days like today when the market is falling Kevin, but not when the yields of the Treasuries are rising, I mean, the big bond route, doesn't that make you nervous as a holder of dividend stocks because now there's real competition against those stocks because bond yields are at multi-year highs?

You're making an excellent point and here's my return to going back in history and looking at periods where economic activity and low unemployment has forced the Fed to raise rates, you get a correction like the one we're in. having now, but then you go to companies that are growing cash flows and increasing their dividends over that period, like the boring ones I'm talking about and continue to perform even in a rising interest rate environment, the reason why Why rates are going up now is that the Fed has no choice but to 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 throughout America, we are having the best year in our history and we love what is happening with politics and yet we have to deal with the fact that the Federal Reserve is starting to raise rates, so no, we don't.

I'm. I'm in love with stocks that don't have improved cash flows or don't have the benefit of tax reform, but there are so many things to do that I really think we're going to end up with a good year at the end of this year and I remain optimistic for the next one too, maybe not twenty-one percent earnings growth, but I think we could have a good six to eight percent and there's nothing wrong with that, assuming the policy stays the same, so Kevin elaborates on that So if you are so optimistic about the strength of the underlying economy and small and medium-sized companies and have such a good understanding of the exposure, why are we seeing such a large sell-off overall?

The index put us on and off the dividend yield, just the broader S&P 500 and the other current indices, how many more downsides are there that would be somewhat justified compared to the strength of the economy that you're seeing? Well, I think it's fair to look at large cap companies and say they should have some exposure to the volatility of the rest of the world because 47% of SM's profits come from the overseas market, particularly Asia, which is experiencing a massive correction, and Europe, which is slowing down a bit, obviously. German numbers in the last three months have been slower than people anticipated and that started to be reflected in some of their debt, but I still look at that and say to myself, "okay, I'll own those companies because of its large scale and its 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 that do not sell abroad and that have many of their input costs in question, which is one of the reasons why small caps are correcting people are worried that tariffs will actually affect the cost of inputs When I look at it, I'm now over thirty in the air in almost all states, we've never had that lack in the last two quarters.

I've never had anything. So in my life we're firing on every cylinder that we have and so look, yeah, we should be worried, but in my opinion, the core economy, the core American economy , it's on fire, it's on fire like it was in the '60s, that's how I So when you talk to me about competition with my new incoming dollars, I'm not going to buy a ten-year bond at three percent because my companies They are doing better every quarter, so why would I want to put it in a long-term debt position that only gives me three.

I remain optimistic about the US economy. my money keeps going there because I

live

it every day. These are not public companies, they are private companies that send me a check every quarter and the cash flows are going up, I love them, not the blue apron, Kevin is down 16 percent in the last three months, sorry, I just received a call, I know it's in your power lunch stock draft, it's not a good environmental dividend payer. I

live

in volatility like everyone else and I can't be right every day, but I buy cash flow generating balance sheets, that has been my mantra for a decade and has protected me in times of extreme volatility.

Oh, 708, I mean, you know these are the companies that come back the fastest and when you're an investor, you have to make a decision every day: I want to turn to cash and by the way, cash isn't so horrible today. , you make 2%, but if a company can make five, six, seven percent, it increases cash. I'd rather be there and live with the volatility and the reason why we are not yet having a major correction in China history if we come to a deal like we did with Europe like we did with Canada like we did with Mexico if we come to a deal agreement with China.

Katie closes the doors because the advantage for the SP, if that is resolved, will be extreme, she will have a concern about a merger that is not talked about on a day like today and that is it. why the market is waiting to see what happens with so many minutiae and Kudlow went out of his way to do some work there and figure this oil out, I hope they are watching Kevin, thanks defensively, good to see you as always, Kevin O. 'Leary, oh right, it's ETL. We know why he likes dividends so much because he is used to receiving a check every quarter from his private companies.

He needs to get the check. You like the cash flow. Great Mormon perspective. It's mixed perspectives from Kevin. Let's check. on some individual stocks to watch today turn bearish Barclays note turns bearish on Alibaba cutting its price target from 2 to 5 from 2 to 10 also reduced its advertising revenue growth outlook due to slowdown in China's macroeconomic environment Key Bank also cut their price target from 2 to 15 to 20 and Alibaba stock, as you can see, is down about 5%, of course, performing poorly due to China fears. I dove into some of the valuation this year and next, this is from the Barclays note, it has a PE of 30 29.5 you compare that to Apple and Facebook in the teens Google in the mid 20s and suddenly you think white, why the hell would you buy that, but exposure to a high-growth tech sector when you have those China fears like Well, and a premium valuation for Alibaba, even despite the decline we've seen recently due to China fears.

China, I mean, was having double-digit revenue growth, the results were amazing, and that whole premium valuation was growing very fast, but that's still expensive. Stocks to watch today are Campbell Soup, actually a rare bright spot in today's session and charging the third point increasing stake in the company to nearly 7% from 5.7 percent, according to an SE in the presentation. He also published some letters. I mean, this is what it is. a fight for power he wants a full pension but between 5% and 7% increases his power to get what he wants well, he is against him, he is against the majority of the family, the family is divided, he has one of the members on your side.

The shareholders meeting is on November 29 and I want to say that it will be difficult for you to get the votes. What works for you is that this company is performing poorly in both earnings and share price, but the company is undergoing a strategic review. has an urgent search right now for a new CEO and is fighting back by saying that Loeb hasn't really come up with anything new first, he was pushing for a full sale, now it looks like he's pushing for a turnaround in the

business

, but it's not clear what It's what he's doing.

I intend to do this, so it becomes more bitter as we get closer to the date and we will now wait for the response to a bunch of more recent letters from Campbell's. How did they vote for good soup with a 1.2 percent increase at the end of November? Let's return to the broader markets. We are down 576 points on the Dow, so we are slightly off the low which was 640, but we are still down more than 2% and about 3% on the Nasdaq. Joining us now is Steve Phil, CFO and CEO. Ron reshef Skee thank you very much for joining us Ron.

I mean, what's your first view of this sell-off where we do this kind of pullback or is it panic selling that people should take advantage of as an opportunity to buy? Look, I don't think we've had a five-day pullback since April, rates are going up and 10-years are going up. I think this is healthy. I think this market could correct itself here. We could see another 5% drop, but echoing the comments of your previous guests. Economic conditions in the United States are very favorable, so I mean, Ron, you've been an optimist for a long time. Can you explain the action in the financial sector why they are not getting more benefits from this new world of rising rates than other financial sectors have had?

There's a big rush here too and you know you're seeing tepid loan growth and some things that may not be entirely in line with what you're seeing with rising rates, but you know that the finances that we've regressed, once further. I think they're going to be fine I think the economy is going to be fine this is 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 are killed by the Fed Federal. I don't think we're in that range yet, but that's something to keep in mind: what kind of Fed rates or 30-year ten-year matrix kills the bull market.

Well, look. I think Pease is coming like the ten years Earnings increases have to keep up with that today our equity risk premium something I always look at the yield minus the ten years makes the holding become more and more competitive with returns stock futures, so you know the holding would be get 350 360 and earnings don't go up much, that could be the recipe for a market not doing very well, but what we absolutely have to remember is that the United States, with its fiscal policies, it invests heavily. Dollar gains here may also surprise to the upside, so I wouldn't be too worried about what I think is a healthy correction in this market.

I think I would buy shares once this is done, although I must say that there is another one that could be seen. 5% down from here, so everyone is using the term late cycle nowadays, one of the most popular on the net. I wonder how you interpret that because you see a very strong economy. I mean, most of the data supports that is this late cycle and if So what does that mean in terms of us hitting a recession? Well, I think many people think that the cycle is late and it is not. Personally I believe that, in manyIn many ways, we had a recession in 2015-16, when industrial production, you know, was really almost recessionary levels today with the fiscal stimuli and unemployment with the United States so strong.

I really see the next few years being very, very favorable, so I don't see a late cycle. I know that's been the popular word today, I think. Again, normal correction, we have corrections from time to time, let's do one now and move on in terms of what we are seeing in the rest of the world. Is that a concern to you or should the US? Being a little more insulated from the flow of negative news or negative movements in the stock markets, whether in Asia or Europe. Oh, look, I think it's negative. I think the story at the beginning of the year was growth synchronized with the IMF. speaking of the world growing in a synchronized manner and I believe that the only one that has fulfilled its part of the bargain in this regard, like the United States, the rest of the world is in a correction and I don't think we can turn a blind eye.

Towards that, that may be one of the reasons we're having a pullback, but I don't think it's the beginning of a bear market. Okay, some optimism, Ron. Thanks for joining us, hey, you absolutely know that. I've been So far we'll look at Ron Couch SK, the CEO of Steve Fake, let's go back to Bob Pisani to find out more about what's behind this huge sell-off. Bob with the Down 630 points. Yes, today we are lower than we were. The previous four days 1500 we have been down in the SP, but the same has gone down further. There are two major problems: technology stocks and industrial names, so you see technology and industrials as the weakest.

We also have some weakness in energy, but energy. has been a big market leader recently banks are down relatively 1% but not as much as the rest of you. Look at the Dow laggards. These are the same stragglers we've seen every day, so they get their Microsoft, their apples, and their skittles. In 3 minutes you get your big tech names and you get your big industrial names. We all talk about the technological situation. We've gone from a low-growth, low-performance world where you bought technology now to a higher-growth, higher-performance world where technology is a little bit out of fashion.

Treasuries are starting to look very attractive versus certain stocks and that's a big factor and now you're starting to wonder if we're playing bigger stocks, so look at the Dow leaders or release stocks that haven't fallen as much today. Your P and G, your Johnson & Johnson, your Walgreens, your McDonald's, these are the classic value stocks, there is some flight to quality here, but there may be a sneaky long-term tightness to this value play that ultimately works in the longer term. Didn't work for 10 years, market leaders. I just want to emphasize what we've been telling you all day.

Look at these tech stocks that are 20% off their 52-week highs, but a lot of tech and a lot of leaders are still doing very, very well. Well, healthcare is just 2% away from its 52-week high in utilities, 4% in energy, about 5% in consumer staples real estate. Also, these are all value stocks that are holding up relatively well compared to the bigger declines we're seeing in tech and industrials, guys, again, Bob, thank you very much for that, see you on the court in about a half hour , let's bring our cash from UBS financial services, arts please, Bob just described the Nasdaq as down more than 3%.

It's only the third day of this year, if it closes, was this level of liquidation justified in your eyes, yes, I think what you saw was a chest and a bust, the first two weeks of October are historically skewed to the downside. We usually clean up from September, we didn't get much this year but we are still in that negative two week period. He came in this morning, now in the previous days of selling we saw the market drop and various moving averages, various trend levels and they tested successfully and they bounced around a little bit today they went down into those testing areas and they failed and I think that caused a lot of people to say, "Oh my gosh, this is not what we're used to." led to further weakness and I think that's why you're a little bit down 600.

I mean, things are getting pretty ugly and it looks like we're headed for a nasty close, so what would you be on the lookout for during the night as a clue as to whether sales? continues until tomorrow are we seeing the Chinese currency correction? The Treasury market is leading the charge. I think you want to see people watch the auction and pick apart what the bids were to give you some idea if there was any backing from the Chinese. I think we want to watch the foreign markets as we broke through support levels, the continental European markets were starting to accelerate lower, so I want to watch the foreign markets and see how they are going to see if this improves. above, I think it's a calendar item and as we get through these first two weeks, things may slow down, as you mentioned the last few hours and 90 minutes of European trading, which were pretty bad, but Dax looked particularly ugly. "We have earnings starting in earnest tomorrow with some of the transportation bank names on Friday.

It's something that could stop these selling. I mean, if earnings come in a positive sense, I think it would be like that if we get through the period." of profits and them". They seem to be holding on, that will start to calm some of this down, but for now it's 90% technical, I should say 80% technical or 20% concern about foreign things like currencies and trade wars. Everyone is wondering if this is finally the shift from growth to value, what do you think when you hear me mean that value stocks have performed much better throughout this well? I think because in this case they are a little more defensive, you know, the growth is called into question. because you don't know what is going to happen to world trade and what isn't.

I think that is the trend that is going to happen, there will be an important change in the direction of the market. I'm not entirely sure about that. Thank you very much for joining us. There we could re-enter at a time without three and a half percent at the Nasdaq session lows, which means a drop of more than seven hundred points in the Dow Jones, as you can see there, a two point seven percent percent, a quite surprising drop. In that sense, our money is still with us, just from your response, the Nasdaq is down three and a half percent, seven hundred points on the Dow, yes, no, I think this is the end of the day, people are leaving a very nervous state.

On the day, as Sarah said, there are concerns about what is going to happen in foreign markets, since they were reinforced. Europe saw some nasty selling at the end of the day, so I think people don't want to take on too much risk overnight, so let me sell. here, I mean, if you look at the Dow right now, it's a sea of ​​red, there's not a single doubt that stocks are higher right now and that includes some of the offensive calls like Procter & Gamble Home Depot McDonald's, which They were higher. early in the session now the biggest losers in the Dow and the broader market have deteriorated 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 liquidation guy thinks that's why sales are broad, there's an old saying on Wall Street that you can't sell whatever you want, so whatever you can, including your grandmother's necklace, is fine, so some of favorite stocks are no longer favorites when you are in this type.

For example, we just fell below the 200-day moving average on the Nasdaq, where we are well below the 100-day moving average on the S&P. Now, one thing that concerns you is that you mentioned falling below those lines. When will the next support be after we break through them? Well, I think what you're going to have to do is see where they really close here because what happens is when the show starts to panic, you move away from the support, so I. I'll take a look at them and tomorrow morning I'll give you some numbers you can look up.

Thank you so much. I'd just like to point out to Wilfred that, as we're seeing, I don't know if you called it panic. but as we see a steeper decline in clothing, we are seeing a shift in bond yields where they are actually buying Treasuries and the yields are lower now on the ten year bonds dropping 320, so the hold on two-year yields has dropped in the daily flight to shave just where I was wondering where that was at the top of the hour you traditionally see that in two US assets, but only when it started to accelerate during night and people are saying I want to get out of the risk area and stocks I need some protection let me bite someone I think there will be a lot of phone calls to the Fed tonight among Fed insiders should we be worried about this and where are we going to pick up Do you think there is part of the blame is the fact that I think they move a little bit and stick to the dot plots or that the president moves fast, yes, I think they move pretty fast, already You know, I've been a bear.

The economy is excellent, as O'Leary said, if you look at the NFIB report this morning, the president of the NFIB made a statement with it, there was almost vertigo, he talked about how excellent the environment is in which you would expect the Federal Reserve will increase rates. I understand that, but it's starting to have an effect on things like housing and other places, so I think they want to be very cautious as they move forward. I think we need to move away from dot plots, we will raise rates if necessary. They were almost committed in December, but I think I want to hear some conversation from the various Fed chairs and governors about how fantastic the monitoring is, as always, all cash.

Thank you very much, let's send it back to Dom Chiu for a look at the movement of the volatility index today Dom, okay, so the volatility index, the CBOE volatility index, the VIX, also known as, is right now near the levels highest of the session. I'm not going to quote it in percentage terms, but rather give Do you have an idea how it is that we are now in 21 places 6 7? This is now one of the biggest levels we have seen the VIX gain here in months. At this point, he also mentions how that translates into broader market declines here. you mentioned that the 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 we've really broken down below the 200 day moving average looking at the graphics here. since July 2016, so it's been more than two years since the Nasdaq Composite has seen this type of weakness relative to its longer-term trend averages.

I also want to draw your attention right now to what's happening with Amazon stock. The charges talked about stocks that may or may not want to be in the momentum type names that you guys have been discussing. Amazon is important here because right now Amazon is also at the worst levels of the day, right now down about five and a half. percent I would also point out that Amazon stock fell here the last time we saw a daily drop like this, it's been months now, if you go to the levels we've seen on amazon.com the 1 day drops are the worst since Also we saw it in February 2016, so the whole 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, We'll see if that somehow.

Shape or form it finds some kind of support here, but we'll talk a little more about some of the levels that traders are watching as we head towards the closing bell, Sara Wilford, back to evil, okay, stay close, Don, Thank you very much, Tom. mentioned heavy selling across the tech space, the Nasdaq was down three and a half percent, the Nasdaq Biotech ETF fell more than 2% today. CNBC's Meg Darrell takes a closer look at what's driving that decline, particularly Meg, hey, Sarah, as well as the rest of the biotech market. stocks have accelerated their sell-off this afternoon, they are now down almost 3%, but they are down much more over the last week if you look at the biotech ETF, the xpi at a 9% discount on the IBB, with a drop over seven and of course it tends to be the riskier smaller cap biotechs that swing more widely and that's basically what's happening today.

I mean, check out stocks like amicus you can see there, that thedivergence becomes even clearer when looking back over the last month. The IBB, which is more inclined towards larger cap stocks, is down significantly less than the xbi, which has more exposure to There are currently a couple of reasons for this divergence: one could be rising interest rates or simply the fear of interest rates rising. Investors like less fun, lighter V-squared asset management. They argue that biotechs will suffer in higher rate environments, but Cowen's research actually took a look at this earlier this year, looking at 20 years of the relationship between biotech performance and 10-year returns. , surprisingly found that in the five periods in that time when performance generally increased, so did NASA's Technological Biotechnology Index.

They say investors' risk tolerance is a better predictor of biotech performance and that the guys could be playing into what we're seeing now just in terms of the broader healthcare movement. I mean, it's actually the best performing sector in SP so far this year, with around 12% being affected. With the rest of the market today, many people are seeking a leadership position in healthcare. If this market can change, it says there is a lot of value there. How do you see that? Yes, you really have to break it down into biotech sections for healthcare. Durbin certainly has the most momentum if you look more closely at names like Aetna and health insurers, those companies are holding up much better this year, the larger cap pharmaceutical names are generally doing pretty well, just not as well like the health insurers we were looking at.

Today, of course, you had some news about deals with CBS Net that didn't get approved, but there's definitely some divergence in terms of what healthcare sectors you're looking at, okay, Matt, great stuff, thank you very much for that. Let's take it back to the broader markets. new session low in the Dow 765 points, but we have come out of that 2.6 percent drop as we speak, the Nasdaq is down significantly, of course, the art of lagging major indices is down 3.3% there a summary of the drop 2.7 Russell is down 2.4 Mike Santoli has also joined us here at number nine, Mike.

I mean, this is that sales have really accelerated, we've gotten closer to closing, yeah, I think you didn't understand what had become a typical 2 o' Clock 2:30 bounce attempt, so it seemed like there would be broader and more aggressive de-risking on extremely large volumes in ETFs. I often look at things like the SP and the Dow are going down very close to the same percentage. there are indices built very differently, it just shows that there is a widespread haircut being applied to stocks, to me it's about a lot of the things that we've been pointing out for a long time in the market and they're all sort of happening right away. maybe it was addressed for tech to get 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 that's all well and good , but there is always something that comes to the rescue of The general index had this rotation that worked for a while, today it did not work so clearly.

This is a big sell-off and it's painful for a lot of people in this market, but we looked at the VIX and Dom pointed out the following. called fear index at 21, obviously it's a big jump today, but it's not even close to the highest levels that we saw earlier this year, like February, no, I mean, in February there was a very unusual kind of round of destruction in the volatility trading space because there were people. aggressively speculating on continued low volatility, so no, it's not extreme by historical standards at all, in fact a panic move, but it's not a panic, but it's worrying, it's showing a buildup of anxiety, broadly speaking , you really wouldn't like to see.

The market closed near its lows and the VIX closed near its hives, showing that there were not many people who took the opportunity to buy in this condition. Well, Michael, to what extent is what is happening today similar to the worst days we had before? in January/February because clearly after that we had a lot of worries, we are in the middle of it, but we recovered and the rest log said yes, this, if anything, reminds me a little more of what we saw even in June, where They were down 3% from high to low in a few weeks and it looked like for half they wouldn't get back to those old highs from the beginning of the year.

I think the market was more overextended than recently, the sentiment was much more bullish. in January that had to be removed from the system and valuations were higher, so I think right now there is a little bit more acute sensitivity about what 2019 is going to be like for global earnings growth and whether these trade frictions matter and then, when bond yields rise at the same time people are worried about the risk of a slowdown which doesn't seem right, it seems like there isn't as much cushion under the debate with art about how much of this is attributable to the Fed, yeah, I mean, Thoreau looks at part of the backdrop.

I think the Fed beneficiaries have definitely made an effort in recent weeks to remind the market that the Fed zone forecast is for three more rate hikes next year, the market was not having it. put a price on that or accept it as the likely outcome and I think they meant the underlying thing on the beach last week when Powell said we're nowhere near neutral, that felt like a turning point, it did and I think You've got the attention from the people, but again it was mainly because he is reiterating what the Fed has been saying on paper, but people didn't like him saying it out loud, so I think this idea that the Fed is paying attention to things that aren't really market based right now anyway they're not talking about global instability they're not talking about volatility in the markets because they don't see it as something that's threatening the US economy right now And also when yields go up and inflation is the concern, as opposed to when Janet Yellen was there and we were avoiding deflation, it's a different equation because it means yields can go up and the Fed might still want to. do it. get, get out, okay Mike, stay with us, of course, as always, for technical reading on the current market sell-off.

We're joined now by Katie Stockton, founding managing partner of Farrelly, and strategizes how much technical damage we're doing in the liquidation today. and what level should we look at Honestly I would say none at all and with this type of action we just don't want you to panic. I think it's kind of a day where we do nothing, we can let the market panic for us and by doing so. it becomes a capitulation hit, so what we tend to see on these types of extreme days for internal market measures are very, very oversold and believe it or not, with this level of decline we are still not seeing many breakouts at the The level of the individual stocks and what it has done has taken away the feeling of having been too bullish at the end of August and now what would be too bearish a reading, so Katy, that's interesting because if I heard that right, forgive me if I didn't do it.

Market participants today have been pointing out the fact that we have fallen above the 200-day moving average on the Nasdaq and that the S&P is well below the 100-day moving average that we are at, but that is not something that concerns you as a technical analyst. A couple of things, obviously, moving averages tend to act as support at times, so we have to look at the greatest number of buffers, not the precise points, and also recognize the fact that the major indices have really tended to touch bottom just below these moving averages. A good example of this would be the Russell 2000 index in relation to the 200-day rising moving average and that index would point out that it has its first medium-term oversold reading since mid-2017 with this drop and even with the magnitude of the decline on the small cap front.

As a person that people oversold relatively speaking, we are not as flawed as one might think. What if we look at some of the other international markets? Does it worry you less or more? Clearly, the influence we have had. Seen whether it is a good day or a bad day in the Asian and European markets has recently been significant in the US market; In fact, we have seen underperformance outside of the US and certainly downtrends are more prevalent outside of the US, which I am noticing on the charts and these are still signs of low conviction, but we are seeing some short-term countertrend signs that would advance the oversold conditions that we have abroad and when you look at the relative, even against a good so-called safe haven market like Germany's DAX, We are seeing these signs of countertrend that would suggest that you get some rotation from overbought markets relatively in openly or oversold markets.

Well, Katy, thank you so much for joining us, Katie Stockton, and then sending it back to DOM, to HQ, with a look at key levels to look at, all right, so you'll be excited, you and Katie Stockton just talked a little bit. about those levels, the cushions and the moving averages that Katie Stockton talked about, we just want to show you visually putting those trend lines into play with respect to what's happening right now you mentioned the Dow Jones Industrial Average right now, the 50-day moving average, the 50-day moving average price is what's in play and as you can see here, we're just below those levels right now, trying to see.

If there is any way to find some support, remember that over the course of the last year we have bounced off some of these levels in the past, so we will see if we can move that trend line up or not. The thing to watch here, in addition to another chart that we've talked about, is this whole idea that there are moves in the long-term averages, as well as the Nasdaq Composite, this is the 200-day moving average and as you can see, we have now just fallen below that level, so looking at that as well on the Nasdaq and one more point here to refine all of this, as the Russell small cap index is well below its 200-day moving average , so look at these large drops overall, these are the ones to watch now if you're looking for a bright spot in this market, just follow me up the wall because there have been parts of the market that Sarah mentioned that utilities have a outperformance, but if you take a look at some of the ones that at least their stocks specifically have performed a little bit better on a relative basis, they've been some of the retailers that maybe have multi-line features here in the United States, but we're Speaking of mid-scale names like Kohl's Department Store, those stocks are actually outperforming the market in the green so far.

You can also see what's happening with Nordstrom, which now outperforms those in the red now by 3/4 of 1%. The dollar tree is up 2% and its target is around half a percent at one point, all four stocks were in the green, but they are relatively outperforming, so while we talk about maybe the moves that we're starting to see, there's a sense that some of these stocks could in this The current environment is underperforming and you're starting to see some of them develop at least in the domestic market or in multi-line consumer products oriented, retail names like the ones we're seeing here, guys.

Oh, by the way, it's the worst document. Thank you so much. I'm sorry. just sign up and see some of these records, which is significant: the Nasdaq is on pace if it stays where it is down three point nine percent for its worst day since then and Brexit, that really puts things into perspective, Let's start with the Dow Jones, although there is the intraday chart of the Dow Jones and a few moments ago we were down over 800 points with a drop of 790, but essentially we are close to those session lows. There's a really ugly chart today, take a quick look at the four indices and we point out that the Nasdaq is The lag is that all four indices fell over 3% just moments ago, but the Dow is just above that, but it's still a drop significant.

The Nasdaq was almost down 4% if you look at things, but just below that level, so was the Russell. a drop of just under 3% is going to show the DAX chart quickly today because sales verystrong in Europe towards the end of that session caused a rebound in sales here when I bring in Bob Pisani and Kenny Paul Kerry for that brings in Bob. We are refusing to get off the tires that we have been pointing to Germany with more than 15% of its 52-week highs. It is important to emphasize why this is happening. We are moving from a world of low growth and low performance to a world of higher growth.

The world's highest-yielding technology loses popularity Treasuries start to look more attractive and value stocks, like consumer staples for caps, start to be worth it, that's true, but you know, at 3 :30, when the Nasdaq broke its two hundred seventy thousand four percent, exactly, exactly. but when the Nasdaq broke at seven at 3:30 you could feel the color in the market, because look what the Nasdaq is doing, now they're going out of business, all the algorithms wouldn't overload and you weren't taking that risk because these blacks boxes these algorithms say you know they take those technical signals so now it's all about a technical break you can say whatever you want about the raid talk about China sorry anything so far it's all about detectable techniques it works with the fact that the world is changing there.

Nice photo, fire chief, you have a higher rate than six months ago, guys, thank you very much for joining us, right at the end, the bell rings, the great Fort Defiance, thank God, it rings after Nasdaq, which closed with a 4% drop. Wow, that's a big drop. For us today for the Dow without 820 points, the extraordinary sell-off that we see today, which is doing so for the first time, implies much more discussion in the second Sarah, we return to you and welcome to the bottom line, your eyes here. for Kelly Evans Wilfred Frost will join me in a moment Mike Santoli is here CNBC Senior Markets Commentator, let's take a look at how we're ending a brutal day on Wall Street, it was ugly throughout the session and the loss has really picked up steam in In this final hour of trading, the Dow closed almost near the day's lows, down more than 800 points at 818 points or 3%.

SMB 500 fell three and a third percent. Check out Nasdaq Technology Leading Nasdaq Composite Sell-Off. a 4% drop that returns us to the levels of May 29 for the S&P we are now at the lowest point since July and the Dow the lowest level since August 16 the russell 2000 which has been in correction mode the decline almost 3% also ugly and widespread across the board Mohamed el-erian Allianz Chief Economic Advisor will join us in just a few minutes with his opinion on the liquidation and what to do next, let's talk about this market Stephanie link by Nuveen Atia there is a company here Dell red across the board, the biggest loser, although Nike in the dollar tree FMP was the winner today Tiffany was the straggler we talked about after that China warning from LVMH tonight Mike, what stands out for you In the sea of ​​encouragement it was pretty indiscriminate you had over 90% of all volume down which has actually been pretty rare even when the markets struggled you haven't had that first move 1% in a long time, I think a lot.

A lot of things kind of broke down today, right, we had this rotation that was kind of a bailout of the indices for a long time, but it's the markets that are being tested by this new higher level of yields and the fact that which is going to have to cause some type of valuation adjustment, we are very sensitive to any signs of a slowdown in earnings growth. You saw it anecdotally for a while and I think that was it, plus some technicalities. the breakouts gave you this wave of selling, isn't it great that we closed near the lows of the indexes and at the lows of the volatility index, so it shows a kind of unstable tape, we'll have to see, that being said, A rapid oversold and it wouldn't be surprising, because most stocks have been down for a while for the ingredients of a rebound to be taking shape.

Mike, when we first experienced this or in the last six months, eight nine months ago, in January, there is a lot of talk about this. The first time we've had a seller this big since the markets have been so dominated by the index fund algos, does that mean that when we're up four percent in a day for the first time since you stopped it for the Nasdaq, that Does it mean that tomorrow we will wake up? and I have the same thing again, how do we show it to you? No, I don't think so, honestly, I don't think so.

I mean, look, it changes the pace of how the market operates. I think you have many types of signals that a lot of people follow it collectively, but I don't think it feeds itself, if anything, algorithms are essentially the most disciplined traders you can have, so they're not going to push, they're probably going to look for 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 is chattering in Washington hey, thanks Sarah, that's right, I can tell you that President Trump has been briefed on the stock market sell-off today in the Oval Office this afternoon, just before leaving moments ago from the White House on Marine One en route to an event in Pennsylvania.

This afternoon, a senior White House official is offering a statement on the market sell-off saying that this is a bullish market correction. This will probably pass in a healthy way and the US economy will remain strong, so the message from the White House is that this is a bull market correction, which is obviously bullish language to describe a sell-off. of over 800 points here, but the message from the White House. It is clear that the bull market will continue after this correction. They are saying that the U.S. Acknowledgments in these types of situations 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 that this trend that we have seen in the general economic growth is not going to Go away just because of a day of bad sales on Wall Street, Mr. mm, the Chinese negotiators will lick their lips when they see this.

It's a fascinating question that puts some political pressure on President Trump. The president has just left the Oval. Moments ago, the office would not take any questions from reporters who gathered on the South Lawn to try to get him to speak, so that the president would finally be the president. Ultimately, he won't answer this today, we'll see what he says tonight on Pennsylvania, I may address it there, has always talked about the stock market more than other presidents have talked about the stock market, the White House initially, in the early days of this administration said they view this as a mark-to-market business and They see the Dow as a barometer of their success, so they won't be happy to see this today and they wouldn't be happy to see any comments that could link to what's happening. going on in the markets to the president's global business practices and perhaps blabbering Daymond, thank you very much, senior White House official sounds a lot like what our former colleague Larry Kudlow said during the bull market correction: "What is Stephanie "I think, I think so." is, but I think today I mean we've been focused on rates and global growth, but I think today was actually more about earnings concerns because we've had a couple of pre-announcements in the last 24 hours, we've all talked about PPG in the news. true, but we had that group that is an industry that is dedicated and there are many semi-finished semiconductor parts that this company will touch.

They actually massively announced that the luxury sector turned around massively and that was even after LVMH actually reported. a good number, but apparently September was not a comment in terms of tighter trade control, well I think so, but they have included a good number, but people are wondering if that is sustainable, but that is a large group and it has been a lot of growth in an area of ​​momentum in this is more okay and then of course I'll do it quietly. Alibaba is calling everywhere saying their numbers are too high, so all these things are putting profits in doubt and that's what I've been saying all along. earnings have been suffering very little stay strong because the economy is strong if suddenly earnings are not as strong then obviously there are a lot of problems now.

I also say that it is too early to say that profits will also recover. early because the economy remains strong you have to be patient and that's why I'm sorry your question is in a bull market pullback yes we are in a bull market it's a pullback if you pick your spots now of course the great movement that today was the Nasdaq, everything was a great movement, but it was the one that moved the most, with a drop of more than 4%. Arthur Koontz is up there with the collapse of really with a look drop here was led by the big names, the usual big names and the chip sector Stephanie.

I talked about how you know a lot of these producers use chips, chips are kind of a cyclical sector within technology and that's where we saw the biggest declines today, one of the worst results for the semiconductor indices since last June that we have seen. and we've seen a number of lows today in semiconductors, including Marvell technologies in semiconductors and as those guys start to report, there's going to be a lot of concern about what kind of demand they're going to see, especially as we start to get into the new Amazon has been really under pressure since announcing the increase to $15 per hour as minimum starting wage for several employees.

There are some employees. They complain that they could actually earn less under that policy because they will no longer get stock bonuses and monthly attendance bonuses and things like that, but that increases their underlying costs because it raises those salaries and that's probably the same thing that happens to Amazon in whatever business they go into whatever they do is probably going to impact other retailers today who said today you saw some retail names that were higher and another sector that performed relatively better today was healthcare, biotech was lower here on the Nasdaq and biotech is generally one of those sectors that can be very volatile today, some of the healthcare services names outperformed Express Scripts and ended the day lower, but today it hit a all-time high as a rival to CVS in New York.

I see you got the nod from the DOJ for your acquisition of Aetna, thank you very much for that, if we go back to Stephanie to her point about earnings following this/bad news, then we really fall out of bed, which one of those names Do you have more confidence in your numbers? but that has decreased so drastically today, well, I would say the software companies and they sounded the best in the conference season. IT spending is at record levels and most of these companies don't expect that to slow down at all and that's because it's driven by secular growth. topics that we've talked about forever, Internet of Things and cloud security software, so those are not cheap and, in my opinion, they have not been retired enough, but those will be the ones that I will put on my radar and then I also think I watch bang.

I still like Facebook because relatively speaking, if I think it's the hardest hit, it's the most controversial, so it's actually held up a little better in recent days than some of the other fan names, but I think is also a name that I would love to be just not to look like a single man, the information technology index closes the fire today and communication services, the new social networking space on the Internet, exactly I want to say that there are many air under of all those shares is where you would go and if you want to convert the shares into cash that is where you go first.

I think overall what's interesting is that we're, I mean, who knows what's going to happen in the next few days. before earnings season, but if we go into earnings season with the market being very sloppy and a lot of stocks beaten, there will be two different responses to those reports than we've had in previous quarters, where everyone expected big numbers and stocks with this could be better set up, yes, but I think it's also just a general picture, so in January or February we had a 10-year Treasury yield that gave the 2.6 percent that we expected, a 20% earnings growth we are now expecting.

Over the next 12 months, earnings growth will be eight ten percent and returns will be 3.2, indicating that this is something of a tug-of-war of valuation versus good numbers, which is slowing down the multiples, which have dropped from 19 and a half times to 16 and a half times. Half is just another way of saying that the profits have been so great that it rescued an expensive brand, but you're not asking to pay that much right now because we'vehad multiple contractions throughout the year and I would say that's really the reason because of REITs in general not only not necessarily the winning streak but the concerns about rates.

I just want to bring someone else into this conversation who joins us now on the phone to talk more about the big sell-off: Mohamed el-erian, chief economic advisor at Allianz Mohamed, with the Dow Jones closing lower at 831, once You've been relatively optimistic about the state of our economy, what is your level of concern after this big sell-off today, this maybe it's because you were on a plane today, but I think of this as the markets changing well. entry while flying at high altitude, what do I mean we were a liquidity driven market? We are increasingly becoming a fundamentals-driven market, which is good news in the long term, but will inevitably have a lot of turbulence in the future.

In the short term, and this is not just about fundamentals, this is happening in the midst of great divergence, growth and policies among advanced economies, so it doesn't surprise me that we're looking at the one question: do you know why it took so long? But it doesn't surprise me. Not at all Mohammed Ali in the week you said the IMF was too bearish when it downgraded global growth, so are you still as optimistic as ever about growth prospects, particularly in the US? And if so, is this just a temporary setback? The United States will be a 3% growing economy both this year and next.

The IMF gives us a 2.9 and a 2.5, but I also said, if you remember, that they were too optimistic away from the United States and that speaks to this key issue of divergence when you get such divergent weightings and growth policies. , the markets begin to stretch. Remember yesterday that the yield spread between the 10-year Treasury and the 10-year bond was a huge 270 basis points, so there is a lot of tension in the US context. gaining momentum and the rest of the world slowing down what's up with this move in bond yields? Mohamed, how serious do you think it is and do you expect it to continue given the economic context and what the Federal Reserve is doing?

Yes, you know he's not going to do it. be linear, but you would expect higher yields and you would expect a steeper curve and that is entirely consistent with both what is happening in policy and the economy and what is happening with non-commercial buyers of long-term bonds; they're slowly coming out of the shrinking influence and so we should expect a higher year and a steeper curve, but it's not going to be linear, ma'am, but we did get a comment from the White House that said, look at the fundamental growth. in the US it is still fantastic, this is just a one day market movement and people should not worry about it.

I'm paraphrasing that, of course, what the Chinese reaction will be when they see this kind of stock price drop, this is the playing field. In terms of the negotiations between the United States and China, even as a strong word, Wilfred, I think what it does is it makes the Chinese say, "Well, it's about time you know that our markets have been really hit when all this rhetoric started." of trade war". holding finally the US is starting to react, so I think they will see this as something better for them, but I don't think it will fundamentally change what the Bears would say, they would argue with you and say, look, fiscal stimulus can't function. will continue forever and the feel-good effect is going to wear off, the Fed is raising interest rates, something they normally do in a healthy economy, but which can also kill the bull market and the economy and lead to a recession.

We are heading towards a commercial situation. War tensions have only increased with China tariffs on both sides and cost pressures are increasing for corporations. All of this is starting to manifest in corporate America, so what's the main argument there? So I would say that you have to distinguish between the baseline and the risk. scenarios, yes there are a lot of risks, you could make a policy mistake by the Fed, you could have a market crash where the technicals take over this market and yes we could end up in a trade war. I've put that probability at 25 percent.

I know that is a significant probability for such a large event. However, if you look at the baseline, there is something surprising happening in the US, it is not just a physical issue, we are seeing an increase in tax spending, but also in household incomes and also in business investment. We have three national engines running at the same time and that should carry us through this year and the next potential growth, but for the next two years, sorry, continue, Mohamed, now the thing is that for the next two years you know the growth perspective. Good for the US Mike clearly Mohamed is optimistic about growth in the US.

He mentioned that the technicals may take hold, but he is not too worried about that. I mean, how likely is that to happen? The technical aspects take over and I don't. I think anything that happened today would give you an idea that the market is fundamentally messy and that there is something that is adding some selling power here. This was a pretty neat adjustment in share prices at this point. It is painful. Everything went in one direction. and it was a big bite all of a sudden. I think it's a bigger picture. I mean, if we're talking about technicals, I mean, I didn't see the credit markets freak out today, so there's a lot of things that you would look for to say, oh.

There is something mechanically wrong and how the markets are acting. I don't see any of that. I think, although you know, Mohamed raises this great point that the U.S. seems to still have this growth and I would really like to ask if the Fed is looking at exactly those same things and feels like that's exactly where we're headed, right? Are they going to stay the course with the rate hikes? And I think that's maybe what the markets are trying to acclimate to Muhammad, yeah, I think the market has to realize that this is a different set that the Fed put in as people like to call it, now it's out of money, so I don't think this affects the Fed in any way and I think we have to get used to the fact that we have to rely on fundamentals and not central banks.

It is not an easy transition. It's going to be volatile, but over time. In the long term it is better for the health and strength of the markets. We'll leave it there. Thank you very much Mohamed el-erian, don't hold up a flight and get on the phone with us, let's take a look at how extensive this clearance was, Bob. Pisani looks at stocks leading the way down Contessa Brewer is looking at gaming stocks Kate Rogers looks at 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, you're the biggest losers today Now we've been talking about technology and industrial thoughts for different reasons, but let's show you what dropped the most today: Microsoft Boeing 3m Apple.

I would add Nike to that too, what do they all have in common? They are all up 20% or more this year, so there is some certainty of beating the winners. There is some certainty of selling technology and industrial L thoughts, but it is quite broad to beat the winners, the leaders that we have been emphasizing that the more defensive names there are. Procter & Gamble's by McDonald's, Johnson's and Walgreen's are okay, but much less and they really flattened out over the last half hour or so. Technology. We have been talking about big names that are in correction.

This didn't happen today. We've seen most of the big tech names. They reached their highs several months ago, but in particular semiconductors like micron were down 30%. Facebook, the highs from the beginning of the year. Intel is now 22% above the alphabet size, a little better at 15%. Why is all this happening? It's happening too close to the investment world. is changing its difference before we were in a world of low growth and low performance now we are transitioning to a world of higher growth and higher performance. What does that mean? That makes the technology less attractive. It potentially makes Treasuries more attractive versus stocks.

That is an important factor. What's going on? and makes value potentially more interesting over growth. It's an old story that hasn't really stuck, but it may stick this time. I just want to show the market leaders that we keep telling you about all these stocks that are off their 20's of their 52-week highs. and yet look at the market leaders right now, we are healthcare utilities, real estate, consumer staples, which are not down as much as 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 we need to keep an eye on as we move into earnings, guys, with you again Bob Pisani Bob, thanks, let's move on to the contesta brewers, looking at the impact on earnings.

Contessa casino stock, well, yesterday we were talking about those rising rates and the impact on stocks here Sarah and the big loser of the day is Caesars, which has double the debt-to-earnings ratio of its closest competitors and the 75 percent of that balance is linked to floating dead and, as you can see, it is down almost more than 6% on the day. Milko Resorts another big loser on the day, down about 4%, which is related to many of these concerns about an ongoing looming trade war with China, as well as a weakening of the Chinese market as the government Chinese can affect qualitative measures on the Macau games.

We are also seeing Las Vegas Sands losing some ground. Golden entertainment is losing some ground. A bright spot here is Penn Gaming, which is acquiring Pinnacle for $2.8 billion. I spoke with Penn CEO Tim Wilmot today and he told me that he believes the reaction to the rate increase and the impact on Sox charges is largely overblown in his case. It says its balance sheet is all fixed debt, so it's not budging and says it expects a much larger customer base to come online, as well as an opportunity with 40 casinos to really build its loyalty program, both socks today Penn and pinnacle up on the day, well answer, thank you very much for that, let's focus on the restaurants.

Shares of Kate Rogers' restaurants close right in the red, rather along with the broader market, says the stock that took the biggest hit the day Shake Shack closed up more than seven percent. Domino's had closed around three and a quarter percent, followed by Starbucks and Chipotle, both closed around three percent today. Interestingly, I know Bob mentioned this to many of today's biggest companies. The losers were some of the year's best performers, including Chipotle, which is up about 50 percent so far this year, Domino's Pizza, right behind it, up about 45 percent so far, the only restaurant stock that closed in Green Brinker International, which is the owner of Chili's and macaroni grill McDonald's had been positive earlier in the day thanks to that Guggenheim upgrade before closing down almost 1% today and, Of course, the liquidation comes ahead of a wave of restaurant earnings coming in the coming weeks.

You're fine, thank you very much for that. Let's now turn to Leslie Picker to learn the impact of today's compensation on hedge funds. Leslie. Hello, well, I do want to read you one line from a report I received this morning, because I think it really sums it up. From the sentiment driving today's moves now, this report, which comes from a major brokerage, says hedge funds are reducing risk, not eliminating it, by adding short positions in stocks, reducing long positions in technology and putting pressure on the UST 10-Year US Treasury in 10 Years as Rising Rates Derail One. of the last remaining profit centers, tech stocks, so what does it all mean exactly?

Hedge funds have been repositioning themselves to be more defensive, they have been hunkering down and many seemed to be leaning into today's moves now that the report points out the difference from previous sell-offs. January 2016 and more recently in February 2018, where we saw that huge increase in volatility, saying this time managers 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 funds.managers, that's one way to generate alpha from your short book, but I've been texting with sources in the industry and I get lines like Sea of ​​Red Bloodbath, those are some of the main things that focuses people in this industry.

At this point, of course, it's too early to say exactly how today's market moves have actually played out, but we'll be reporting this all afternoon and into the night, Leslie, thank you very much for that. We talked a lot today about selling as linked to rising rates and more Fed activity, potentially more Fed activity, join us now by phone with your thoughts, former Dallas Fed President Richard Fisher Richard Thank you very much for joining us. Clearly, there has been an increase in returns in recent weeks. There wasn't much of that today, but it has been a major factor worrying stock market investors.

What do you think of the recent rate increase and its pace in particular? Well, we had a weak three-year Treasury and a ten-year Treasury. auction today, so I was probably a little bit of a cheat, but I don't think there are any surprises in the pie here, it's pretty clear that the Fed continues to move down this path, this so-called neutral rate, they often discuss it, they don't. I don't know exactly where it is, folks, you made it pretty clear that you're probably going to pass where you think it was, which is the 3% level that we're getting close to, that we've got a ways to go, so I think we're almost there. granted.

Market traders must blame this on the fact that there are no surprises here and, by the way, they can thank the Federal Reserve for taking the market to 666, the devil's number in March 2009, it has been on a roll since We had a great year last year. The DSP is up about 20% so I don't think it's fair to blame the Fed and we are sitting at the policy table like I did for 10 years. I would say that we need to continue to adjust gradually because we are seeing some pressure on wage prices starting to develop now, but the most important thing is that we need to have, as I like to say, some nuts on the tree to get back to when the economy is against from Turner, we haven't seen evidence of that yet, yeah.

I mean, you've been warning Richard that it won't be the easiest transition to go from a world of easy money to normal, but I'm so glad to have you because I know you know the current Federal Reserve Chairman Jay Powell and you guys. You know former Federal Reserve Chair Janet Yellen, and you know there was this idea that Yellen was saying that every time the markets threw a big tantrum, the Fed would look at it and might even pause or rethink the direction ahead. where were you. are they going or how fast are they going do you think Fed Chair Powell has the stomach to handle this kind of sell-off and this kind of jump in rates, probably a stronger summit than his predecessors so far, although I was with Janet? on Monday night and we talked a little about this, she firmly believes that they should not be superior.

She made a very good point in our conversation. I don't want to violate her trust, but several people have been saying this, what is the market. went up if rates stayed low for a long time, it's reasonable for those rates to 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 from Dylan read all the He promoted Sakura C as a lawyer, etc., to the capital markets 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 is no theoretical economist to whom he often refers. This is risk management. exercise and I think he's probably going to be a lot more tolerant if we go back and look at the record of what he said in his first meeting in June 2012: that we had to be very careful here because we're cutting off a one-way street. The street takes the ball from the market and this could become a trap later, so I think it simply comes from its different origin, it is not a question of sophistication, no matter what you understand, markets come and go and the Reserve Federal has supported the markets for a long time.

He made it very clear in his second press intervention: what our job was at the Federal Reserve, to quote him, is not to support the stock markets, their job is to support the economy, provide liquidity in it and that is a shame, create full employment. where we are currently far away. beyond full employment and also to maintain inflation today, which they seem to be doing quite well, Mike, do you think that if we received some type of comment from the Federal Reserve that implied that they are watching this and that there is no guarantee of What do they go up? rates in December and next year the market would accept that higher, it would probably be taken as a net positive.

I think that said, don't rely on that, no, I don't know if you're necessarily going to get that, but I think the market today, just today, when the selling got really intense, started to try to take back some of the rate hikes expected by the Fed for next year in terms of futures positioning, which shows that there is some level of turmoil in the market. that would potentially make the Fed change its mind, but I don't think we're there yet. I mean, well, I mean, it was doubtful it was an ugly day, but you're down three and a half percent, you probably did. about five six percent overall from the highs so I mean this is not something to really freak out about now see if this continues for several days and really gets out of control and feels like it's more problematic for consumer and business sentiment. sentiment and confidence and that kind of stuff and that's obviously going to be something you're going to 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 gone up. since you stopped it, a serious offence, remember, remember where the mandate was the week after brexit one thirty six six it's now hovering around the 320 level so again I don't see anything unnatural here unless, as you say, it continued and it will start to infect the economy and that confidence, etc., we don't know, and that's just that the Fed will only move when market disturbances, volatility, corrections, whatever you want to call them, are perceived to infect the economy real because they mention, can I mention something about the consumer?

I mean, we. It's like that's such a big part of the economy at seventy-five percent of GDP, so obviously I always look at all the different signs. Well after the shutdown we had Costco reporting same-store sales growth of 7.3 percent and it surpassed comfortably ahead of expectations, so I'm going to throw out a statistic like I'd like a quote that way in a couple and I think it's important to remember that the economy is strong, we are in a good place for the Federal Reserve to do what it wants. What we are doing as long as we don't overdo it and that's what obsesses us.

Whichard. I guess the last word for you is we've been talking about this strong economy, not just the consumer, the labor market, I mean the lowest unemployment rate since '60, so how much can you take? 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 they were and are reporting how strong they have been and the strongest in the 25 years or so, that's that database, by the way, those small and medium-sized businesses generally represent 51 or 50 percent of all U.S. workers, so if they feel strongly about the economy, they are wanted to connect Apple to the economy, they are one of the risk growth and hire more people, that will affect your consumers right, the key variable and that GNP or GDP equation, so here's the thing, don't expect the Fed to go out of its way and until you feel, or unless you feel, that the real economy is weakening they are not driven by what happens in the stock market, so they shouldn't be unless it infects the real economy, so that's where we are now.

I appreciate having the last word. I haven't had last words in a long time, oh. it's a pleasure thank you local markets are also experiencing turmoil Seema Modi has the details watching somehow part of the world has been reacting Seema Sarah is absolutely right higher rates in the US have caused more pain to emerging markets the emerging markets ETF was down another two percent today Michele was three percent looking at its worst day since August 15, but look at how individual markets are doing and you'll see the Russia ETF is trading lower by about down 54 percent from all-time high India China Brazil down more than 20 percent Europe is in the spotlight, as well as a notable drop in Germany, which is now down around 17 percent from its respective all-time highs, growing concerns around the resistance of the Chinese consumer that made a series of European luxury stocks fall today LVMH fell more than 7%.

Berberian and there is the Gucci headquarters that leads to Montclair, among others. I also want to point out that financial banks in Europe have seen some significant movements; In fact, in the last two weeks, Greek and Italian banks are down about 16%, so the pain is significant throughout the season. Wolf, we'll have to see how Japan opens up in a couple of hours. It will give us a better idea of ​​how global markets will respond to the sell-off here in the US. SEMA thank you very much for that, rising trade tensions with China are just one of the factors behind the market sell-off.

Join us now to discuss Taiwan Accelerator, partner of Richard Kang and former CEO, CIO and Global Emerging Advisors. Richard, thank you very much for joining us. This means that the sell-off has clearly had a number of factors behind it, whether its domestic interest rates or problems abroad. Update us with your latest views on how much pain China is feeling in its fundamental economy right now. Yes, so they have felt a This year there has been a lot of pain, like the numbers that were just indicated, so a 20 percent drop is a pretty significant drop, but they have had bigger drops in 2015, it was another painful drop recent.

I guess the question is: do you see it on the street, so do investors? I feel pain in the housing market, in the stock market, but if you are on the street you can see that they are still spending. So what does the Chinese market and the Chinese currency in particular reflect on you, which is approaching a very key level against the dollar strong dollar at seven against the yuan, yes, so the IMF's lower growth projections just they are showing with the stock market down and the RMB falling maybe 7% maybe closer to 10% by the end of the year I guess.

That's why the US government is worried about currency manipulation, but if we think about it long term, any kind of tariff or trade war is a selective tax. Investors will also need to modify their selection and allocation thought process to think about what it means to play in the US. China, wherever it is, will not be affected by cross-border transactions its supply chain its sales force will be Let it be Richard, do you have any sense that the Chinese government is losing control of its currency and that there is a risk? that the reserves will not be depleted but will not have enough effect to stop the fall of the currency.

I think if you ask anyone in China they will say yes, there is probably a lack of controls. The flow of money out resulted in something like the Vancouver is a real estate bubble, there are concerns about cryptocurrencies, so I would say most people say yes, there is possibly a big concern there. I think for the global investor looking at China, he's just saying, "I can access China through Hong Kong because of the stock." connected that accesses Shanghai Shenzhen, you can't control what the Chinese government does, actually no one in China can either because you can't vote for anyone else, it's a shame you have to navigate like you would and since it's a big global market decline do you want to allocate more to what you already have on Amazon or something you probably don't have much of from Alibaba?

I think that's the only decision you can make right now very quickly. Just explain to us what would happen, Richard, if the United States declares China a currency manipulator? There have been some hints of manoosh in telling the Financial Times today warning about Chinese currency devaluations. The report will be published next week. What would happen if the US Treasury labeled that designation? Yeah, so I'm trying to think if this issomething short term because it's an election year and there's nothing better for a politician than to find a problem, point your finger at that place and say "I'm the solution", that's probably the shortest term, but the longest term.

I'm worried that it's like two gangs shooting at each other and you know who the guarantee is: Canada, Southeast Asia, etc., anyone who trades with the US or China is going to be a problem and if that's the result of the downgrading of the IMF's economic growth forecasts, then it is a longer term problem, then we have a real reason to see elasticity return and end this long bull market. Richard, thank you. So much for joining us, you can do it Hana in Taiwan accelerator, S&P 500 falls more than 3% today, more pain ahead? Mike Santoli went to the telestrator looking at some key levels, yeah, we basically want to look at the field. overall position this is a one year chart of the S&P 500 this is where we could actually be close a little bit below 2800 today just 2785 this was intraday obviously we gave up on that recent move above the previous highs that were here 2872 that It was the January high that we spent all this time below and the level that people are now concentrating on below where we are now is around 2,800 so here is the 2,800 dollars, the reason is that it was approximately the level that capped the market during This correction period right here we finally broke through it in July before hitting the all-time highs that seem to represent the area where people think that maybe we have to take a position to say that we can protect this uptrend that we have.

We've been at this for a while relative to the 200 day average, that's this line here, this is the base color line that we have, as you can see, as Katie Stockton said earlier, we went down marginally a few times, so that there is no magic in that. If you break the line, it doesn't mean the game is over and everything falls apart. In fact, it seems to act as a sort of slingshot effect when we get there, so it's not so much a tripwire. but I think if the market doesn't mount some kind of defense on the next two or three percent declines, if we really get a follow-through like that, there will be two people saying this is all in doubt. in terms of whether that was true demand for the stock and Mike just looking at the levels where the 200 day moving average is at two seven six five, we closed at two seven eight five, so just above minus the one percent from here, yes, but they are below 50 and now today the 100 day moving average exactly Intimus down, well Momentum is down, but very, very important, the averages themselves are pointing towards up, so if you are below a trend line that is still going up, it is much better than if the trend itself has reversed and suddenly that is when the market loses the benefit of the doubt.

I'm a little curious if you're generally worried about the VIX because we've really exploded higher. I'm not worried, I'm actually looking for that moment when the VIX says we've had this fever and the fever went down and then the level doesn't matter as much as when you've gone up a lot and then you come. Going down a few points, especially towards the end of the day, that often means we've had a little bit of color, so yes, if we continue to go up in the VIX, especially like this, and we don't get any relief. it's telling you that there's some kind of vibe in the market that's not like Stephanie, I mean, you're your core person.

You look, it's not the numbers in the commentary and when you see breaking some key levels and moving. to the averages, how do you read that? I mean, I pay attention to it because I think you have to. I mean, nowadays I pay attention to the quants, I pay attention to the technicals, I pay attention to the fundamentals, it all matters, but in the end At the end of the day, I still think the fundamentals win and even though the charts may not look as good and the Vicks chart, by the way, doesn't look so good because it's going up, but I think we have a couple more days until we get there. profits, so just give it a chance, just give it a chance because we'll hear really good things from a lot of companies.

It's always a tough time before earnings season, pre-announcement season because it's bad, I mean, the floor was also pre-announced afterwards. Apache clothing just had a terrible announcement about a dry hole, so you're going to get this bad news and it's going to be all bunched up and we're all going to freak out a little bit, but let's get through the entire holding season and if anything materially changes, then you know, I'll see if I change my mind, but I don't really anticipate that at all and of course as soon as Friday we'll get earnings from the bank tonight and we'll get comments on the earnings calls from people like Jamie Dimon and Mike Orb and Tim Sloan and those stocks are actually outperforming today on a relative basis and they've been outperforming for the last few weeks on a relative basis, which is a four percent drop, but not quite, it's a long haul as I'm just a long portfolio manager.

I have a reference point and I'm looking at relatively myself, relatively, no, absolutely, let's take a look, in fact, let's see how we ended the day on Wall Street, of course, Sharpe below the Dow's down 3% SP down three point three. the Nasdaq was down four point one percent, that's the worst performance for the Nasdaq since Brexit the Russell was down two point two nine percent, so as you mentioned right, the Nasdaq closed down four percent. , the biggest drop in one day since June 25, the technology sector. The index is by far the worst performing of the major market indices, down more than 6% since its August 30th.

Hello, we're joined now by phone by Dan Niles, founding partner of alpha-1 Capital Partners. Dan, thank you especially for joining us for this great sale. With popular names like Amazon and Netflix and the big winners so far, something has changed significantly in terms of the investment thesis with this group. Well, I think it depends action by action when you look at technology because I think a lot of these. The stock was way above where it should have been given the fundamentals and the valuations or the price it was trading at, it's very rare 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 thought this stock needed to go down much more towards the end of the day. Today we started covering many of our short positions and started taking some long positions to start the day with. 15% in cash and we started to implement some of that as we went, so today we are longer when you take our Long's - our shorts than we were entering, so we think this is good, we think this is healthy, we love to see panic on the street, you know, volumes are up almost 40% of what I saw, traded value is up over 50% of what I saw, so this is positive in my opinion because as someone mentioned earlier , when you make profits We're going to see some companies like some, I think some of these bank names that are reporting on Friday will have pretty decent numbers, so I think that will help that there are other sectors within technology that are exposed to things such as Chinese or industrial cars, etc. where I think you're going to have some real problems, so we've been avoiding the shorted semiconductor space for a while, we actually ended up covering a good portion of our shorts today, but we think the fundamentals are going to be terrible, so I think It really depends on what you choose and the spaces you want to have over time.

With some of the names you're shopping today, well, I mean some of the names we like. Right now we're trying to find names that don't have exposure to China and aren't really affected by tariffs, etc., so if you look at a name like Google, for example, the good news is that they actually they dont have it. getting to operate in China so that's really positive for them and the tariff situation obviously they're not selling physical products for the most part so that's good for them so we started nibbling on that today. I have to close, you know, you look you know, names like Microsoft, obviously, they have a giant exposure, but not as much as most, as you know there are problems with piracy, etc., and if you look at the PC market, this It is the first time since 2012 that the PC market has grown year over year.

Over the course of the year, that's a lot of time and Microsoft will really benefit from that. You know, Intel, another name we also like for the same reasons. You know, obviously, they have to appoint a CEO. I hope they pick a good one, which makes me nervous, but. You know you know again you're in a market where the PC market is growing for the first time since 2012 which is also a positive and we like telecom stocks like AT&T for example and Verizon where we think you know that they will do it. we have good numbers and estimates that we'll be able to maintain and go higher so you know that's something we're thinking about and you know where we start speculating on those types of names towards the end of the day and you don't.

I don't mention Amazon, I think it's interesting because it's one of the quieter 14% drops in the second largest company on the stock market that I can remember. Okay, it's down $300 since that time when they kissed a trillion dollar market cap and obviously had this. You know the idea that they're going to pay a $15 minimum wage and some of this news about it, but mostly it was just a matter of perception? I mean, people just rallied around you, you know they couldn't do anything wrong, where do you see that? stock at least that's a sentiment towel for tech in general you know that's a 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 is what matters, what they are going to ask for, they will ask me for around a billion dollars because of their cost structure. If you look, you know since when it was implemented, so you can't ignore that the other side of the coin is that They are taking advantage of a lot of the infrastructure investments that they have made in the past and they know that getting into advertising is really good because, Obviously, if you are trying to sell products, it is better to advertise on us and on Amazon, where there is a lot. of people are going to buy those products, so we don't know this product well yet.

Because we are still trying to calculate the increase in costs due to the increase in the minimum wage, etc., compared to the positive aspects that we have here in terms of strong cloud growth, etc., but we are definitely looking at and want to get involved again because I don't have much in mind, you know, of Cheyenne, our automobiles or industrial, when you talk about that name, obviously, consumer sentiment, If the market keeps falling like this, you know that's going to be affected and you need to pay attention to that. but yeah, you're absolutely right, it's that the stock got ahead of itself more than anything else seventy years you own Amazon, right, I do, I do and I definitely didn't feel good today because it's one of my most important ones that people have searched for.

It's been a long time coming to have an opportunity for a pullback in this name and I think it's an opportunity, frankly, I mean there were a lot of ways to gain retail advertising from AWS. I think it's undepreciated margins, they just showed us really good margins last quarter, so they also had operating leverage, so the hard part about Amazon is how to value it, but I'm looking at their total addressable market and in fact I think there is a lot that they have in terms of growth and there are things and in the markets that we don't even know what they are going to participate in, so they will continue to evolve over time up to 6% today dan Niles, thanks for jumping on the line, is from alpha-1 Capital Partners. sales underway here in the after-hours session check out three ETFs that track the major averages QQQ that tracks the Nasdaq 100 is down, it looks like a little more than half a percent the sp500 ETF is also down half a percent and the Dow ETF also trading down by that amount, not sure if that's any kind of indication.

I guess we have to see the foreign markets start to open up, it's a bit of a follow-through and usually the foreign markets will take the lead more than New York did than anything else, but not tremendous moves. In the context we were in all day, we should also caution that we should expect Asia to open lower, but the selling occurred much more pronounced in the afternoon in European trading, such as the Nikkei. Early this morning, Hong Kong was slightly higher, so I guess we shouldn't be terrified when we see Asia open up. Definitely going to watch for the sign, Stephanie.

Well,Tomorrow I want to see the initial claims because I got very excited last week. It was the beginning of I thought why did rates actually go up a little bit more right in the margin to the rates we're at, they're on their way anyway the day before the ADP and then the initial claim, so I want to see the claims. initials, I think I hope they are very good. I don't know if that will matter tomorrow. It's not a huge number, but it's also indicative of how strongly jobs are growing. Wages are slowly increasing in a good way and again supporting a very good consumer. which is a big part of our economy and also manufacturing is doing well, so, you know, I said I'm not whistling past the graveyard.

I understand that we are going up very quickly and we are at levels where people are uncomfortable because we are seeing higher rates and what is the type of multiple that you are going to pay for that, but again I think that earnings are going to rescue us, we just have We have to be patient for the next few days, we will wait for the numbers for both profits and the economy, as Stephanie mentioned, the construction company's floor shares are sinking after hours Seema Modi with the details on that Seema yes, take a look to the chart Sara shares a bottom with a drop of around 12% after hours after the company warned on revenue that the shares are down again, another 12 percent at this time, an extended trade, this comes after Since the company reported disappointing earnings in May and we saw the stock drop at that time as well, this is an industrial engineering name and this warning from the floor comes after PPG issued weak earnings guidance just a couple of ago. days the floor claw conference will be at 5:30 p.m.

Eastern will be on that call to get a sense of why it is guiding lower on revenue and its earnings are expected to come out on November 1st. Back to you, Mike, if we saw more of these types of warnings, it would scare the market. yeah, I think you're seeing a little bit of a buildup of these unique, fluorescent ads, obviously, from a particular industry, right, it's just not like they're not building houses and shopping centers, right, these are massive projects, so it's very outdated. contracts and a lot of costs, so I don't know Stephanie Lee.

I mean I would say I would extrapolate a lot no no I wouldn't yeah they are very volatile to your point and in this company in this sector there tends to be no delays so I actually want to hear what they have to say about the backlog on their conference call at 5:30, but these guys are on the extreme end of the spectrum in terms of exposure to energy and mining and it's a very high beta way to play energy and mining. If you expect commodities to rise and people have started to get interested, myself included Jacobs Engineering Jec, that's a name I'm considering, if I sympathized with Fleur, I think it's not an interesting buying opportunity because they just have a much more combination diversified, well you talked about energy, we'll continue to go over the damage sector by sector here and talk about energy in particular, one of the worst performing groups today amid the big market sell-off, ending down about three and a half percent joining us to discuss is John Hofmeister, former president of Shell Oil Company.

John, thank you very much for joining us. I mean, what's your view right now in terms of where we are with broader oil prices and whether they can hold the recent highs well? I think we are in a general upward trend, but that does not mean that there will not be declines which I see today as a decline and probably driven by the size of the liquidation, where some of the traders would worry about future growth, but below. everything and I'm coming from an operational perspective rather than a commercial perspective, but at the bottom there is a four-year gap in capital spending in the industry to replace reserves or increase reserves and we know that in the shale formations in particular there are a rapid decline in the oil we produce, so I'm a little worried given the four-year history of how we maintain growth and meet demand in the coming years, so I'm on the side of rising prices in the coming years. year, year and a half where, as some people say, we could play a hundred.

I'm not sure I'm there yet, but I'm certainly in the eighty-plus range, so I think today is a drop we shouldn't. Read too much into this and where you are 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 to pay higher gas prices, but as the White House's Kevin Hassett told Swag Box this morning, it's not going to have that kind of negative effect on our economy anymore because We are a large oil producer, except from the point of view of the consumers' pocketbook, yes it will be if we get much more than three dollars and fifty cents for a gallon of gasoline or if we get up to that range of diesel people are going to start to go back and we're going to start to see some demand destruction where we really see demand destruction is when it gets to the $4 range, that's when consumers and that's when freight companies address surcharges, all the Prices go up all of a sudden, you know the consumer is really in a pivot from a PE standpoint and an E&P standpoint, the White House comment is absolutely correct, rising prices are actually driving more investments, driving more growth and with the shale formations and so on, but I would look at it not only in the upstream part of the business but also in the downstream part of the business and they kind of come together when you look at the macro numbers of how much growth and the demand there is or how much demand destruction there is and everything is ultimately reflected in the price of oil.

Jon, in terms of, we spoke earlier with Kevin O'Leary, who said now is the time to own dividend-paying stocks, are you sure? that those big dividend yields are sustainable for companies like Exxon Chevron or their former employers in Europe and BP where, in fact, their yields are even higher, yes, and I can tell you from an industry perspective that when it comes to policy dividends there is There is always a multi-year perspective on the dividend policy and it is always analyzed in terms of low price, mid price, high price scenarios, so no company will compromise because it is a type of dividend driven investment market with the that no company will compromise. a dividend policy that in the next year or year and a half they may have to reconsider, they would prefer to have a constant and constant dividend policy because they are attracting shareholders who are more invested in this for the long term, this industry is not for day traders no It is for people with a short-term mentality because the projects are long-term, the investments are long-term both in the upstream and downstream, so it is very important that investors really look and opt for a dividend policy that like it and if your shared appreciation, besides that, that's all for good John, thank you very much for joining us, John Hofmeister hereby, out of shell, the Dow Jones fell 831 points today, Nike, Microsoft Visa, the majors losers after that big drop in blue chips, is today's sell-off. a buying opportunity joining us, Far Miller's Sam BC contributor in Washington, Michael Farr, as well as wealth management point of view, John Patrese, joining us by phone, Michael Farr, taking advantage of the opportunity to buy or wait to see what comes next, wait to see what comes next.

You know, the old stuff, don't try to catch a falling knife, it looks like this continues, this after-hours selling continues and in this little 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 to the trade. The Nasdaq greatly underperformed the Dow Jones Industrial Average after we had a weak three and ten year auction, everyone is taking the Fed seriously, now they are going to continue. raise rates why haven't they done it so far I don't know that Wall Street does that, but we seem to be keeping an eye on those higher rates that stocks seem to be taking, let some steam escape now stocks go down sometimes, it looks like this you have further to go it's the same question for you yeah so I think you know you should prepare your shopping lists and take this opportunity to go out and buy good value companies and I think this may not be the start of a correction, but if it is definitely the rotation of India's lack of growth and value, let's not forget that growth has destroyed value from a style point of view in the last five years and we are seeing that part of the air carries it away or part of the wind twists it.

Gross sales with technology are increasing big time today, John. I guess the question would be if not just the fact that growth has outpaced value. We buy a lot, but we're at that economic point where it looks like value should start working. A lot of those sectors, you know, the beneficiaries are more of an early cycle type of environment, so I mean it's all a function of where your value is today and how much you're willing to pay for future cash flows. and I think there's significant value out there, you know, one name in particular is AT&T, you know, we all know the deal, it's a transformative deal where you make eighteen Ts by acquiring Time Warner, but you get a dividend yield of six percent by this company that markets it, you know, ten times. profits so I think many of you know that worry is already baked into the pie for a company like AT&T and I think it's a great way to get started and get some value and today, Michael, where do you stand in the debate between growth and value?

And what are you buying? Yeah, you know, I've been talking about that for a while. Sarah Anne was talking in Vienna earlier in the year that if you're going to try to hit them where they're not, you have to look. in some of those value stocks that performed so dismally last year and again, we'll continue into this year to make sure that the system is present in the actual balance sheets and earnings of the companies that they own, but I would actually caution investors give this is a little patience the markets go down and being too quick in the draw for the patient long term investor I don't think it makes much sense when stocks start to fall let's see where this goes if you are as a long term investor , you shouldn't change your investments in any way on a day-to-day or day-to-day basis, depending on where the market is, so be patient.

I agree with having a bias, but I think you can be patient. Just wait to see how this plays out. I wouldn't be too eager to rush back anywhere now, although I stay a long time all the time and am happy with the stock I have. Well, guys, we'll leave it there. Thank you very much Michael Farr and John, from Michael Santoli, from the treatise, yes, tomorrow morning, key things to keep in mind. I mean, I don't think you want to see much acceleration to the downside overnight, futures didn't open the solder this afternoon. I do think you want to see certain divergences start to appear. perhaps the expected equal rise The S&P 500, which had lagged forever, outperformed the SP, so it was basically these types of major indices that belatedly succumbed to gravity when most stocks had already been down for a while, so we'll see if it's one less reversal. 30 seconds, what are you looking at? which sectors are set to outperform in relative or absolute terms today it was banks, today it was health services and commodities.

I'm not as excited about commodities leading the way, but I'll take the banks in healthcare, those are sectors I still like and would buy them on weakness, which is your primary bank. My main bank is Goldman Sachs. Okay, oh, interesting. I'll just say it before tomorrow. Watch Mad Money tonight. Jim becoming cautious yesterday for the first time in a long time was a good decision, in fact, he did it at the right time. You don't want to miss Mad Money. You also won't want to miss Fast Money, which starts right now. Fast money starts right now with the latest news.

Stocks are getting destroyed today. Dow is having its worst day since February, sinking more than 800 points, clothing is accelerating selling and we close at the lows of the day. The S&P 500 is now having its worst losing streak in two years and take a look at the sea of ​​red on Wall. On the street, the market took no prisoners and was the hardest hit, down almost 5 percent, the Nasdaq fell a whopping 4 percent and had its worst stretch since Briggs. Everything fromtransportation and small capitalizations, took the chin. 66 percent of the S&P 500 closed in correction territory or Worse, it was a wild day, as it seems like we are finally seeing some panic in the market, so things are going to get worse before they get better.

Is this a fall? Shopping, what do you do well? I think it's good news. Are we right on the cusp of the earnings season we talked about last night? I'm not going to suggest that you knew the Dow Jones was going to go down 800 points today, but we have mentioned that the warning signs have been present in the market. you just haven't cared until today what those warning signs are, well technology has absolutely been changing, frankly, it started with Facebook a couple of months ago with a 23% drop in seven minutes we talked about how an individual stock can do That, who's to say the the market overall can't make the small-cap index has been falling.

I think this whole issue with China will not be resolved anytime soon. I think that has been a problem, sir. Minuchin said today that China's dholtze should not continue devaluing the currency. I think it was ultimately a factor, although 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 is going to be strong, my concern will be what the guidance is going to be in the wake of a lot of these previous announcements that we've seen, let me grab my backpack, that was the reason why the Earnings were rising right on that black, you had a blackout so maybe you get them to help with the heavy lifting but I think today was a technical issue, it wasn't fundamental if you look back at January, February is similar but we went up much more before January, so I think, all things being equal, we will hover around support levels in the market. the 200 day earnings season, I mean, mention TPG today, that's the problem we have, so if we were to have those profit warnings and flower corp after today's close, profit warnings there, so if If we didn't have them, then you might look at this and say, "Okay, maybe this is an opportunity to buy the drop for the longer rod." I'm not clear now.

I think in the very short term you will see a day like this with a drop of 800 points. This is not the day. panic this is the day to start looking hey wait a second as a trader maybe I want to pick this up so what I'm looking for and maybe it will happen tomorrow you wake up The Dow Jones is down to 300 points and the futures in the morning and then you get that reversal which for me would be very positive and I and I would buy that. I completely agree. I guess I mean we're a little bit lower now, clearly, overseas markets are going to open up.

Europe will do badly. tomorrow and I'll probably open up to myself. I'm a little intrigued by this. I always say that when things start to change and integers in a moment something else is happening and that attracts me. I mean, you know, I got trampled today. That thunderous herd of whole numbers is falling, but no, I don't think things have changed that much fundamentally in terms of how the US economy is doing and I think we're going to see some good gains. I heard G point out that it's a good one about it's not just about earnings, it's about guidance, but now the bar is lower for earnings, right, it's significantly lower in many cases for earnings, but remember we talked in January and February, we heard about risk parity accounts that no one understands. that nobody understands gamma, that nobody understands, I felt like integers were part of it, so I don't think it's something, it's tangible, which makes it more biblical for me, so it runs its course, okay, you take advantage, you take the risk, so once.

You get to a certain level, it becomes a screaming buyback and then it somewhat matches the 43 percent increase involved that we saw today. I mean, if you believed their risk parity accounts worked, etc. and everything that's happening, so that was one of the catalysts for it, right? So all of those things are reasons why you want to start looking to potentially buy this market instead of panicking here and trying to buy put options with ball spikes like that. This is, to tell the truth, a kind of technical mechanical part of the market, that does not mean that we cannot go down, it does not mean that the economy could be slowing down or not, but in the very short term there will be a tradable opportunity.

Here this is my question. I'm sure the local players. Thinking about 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 look under the hood of the markets. Well, we lost Fang. In June, the average small-cap stock fell 6% or more in the month of October, down 20% from its 52-week highs. We have all kinds of growth that indicates that areas of growth stocks are really falling. Didn't that tell us from the beginning that there are questions about growth and then we get all these questionable warnings?

Were there questions about growth without a doubt? However, I mean, you're talking about an American economy that has historically low unemployment rates. Optimism is through the roof. until recently they've been rising, so all of those things that man-made headwinds have gained in the review of tariffs in the form of higher orders that we're making or a lot of them are self-inflicted, that President Trump you could be right, the Chinese could be absolutely ripping us away from intellectual property and in terms of trade, there is no doubt about it. I have no idea. I don't attend those meetings, but thinking that there will be no ramifications for the broader market from that is enough.

Those concerns, although now we have meters, have not mattered well and all the fundamentals that you have just begun to mention have been positive, they have been a tailwind for the economy in general, which is why it seems to me that it is a process of greater deleveraging . Risk type trading based on things that have been there for quite some time. However, tonight I'm going to play Debbie Downer because we haven't seen the impact of the last round of tariffs that we've seen. We're just accepting that now with these caveats and each of the indicators that you point to when you look at the dust-coated policies, we've looked at the data points and we haven't seen it take root in the data points so far.

However, he has a factor, you tell him that by factoring a tip, Procter & Gamble, you tell Pepsi that there is a reason why he is in these certain aspects and it could be the traffic or the whole movement. Look, a transient is the right point here, for everyone in the market. or at least the market narrative has been to listen to these tariffs they will be temporary we are going to win this trade war we better come out the other side yesterday the IMF comes out and says hey wait a second maybe not now We are starting to get Ernie's warnings.

Companies say things could be slowing down. These terrorists could be suffering if they believe that the terrorists are going to disappear relatively soon. Let's call it next quarter. So yes, this is a longer-term buying opportunity, but I. I'm not so clear, it doesn't seem to me that these are going to disappear, so I think you have to be more of a coach, much more agile in this, but also well, sorry, one more thing when I'm trading on the trading floor today, what I didn't like was that everyone said let's end the liquidation like it's a reset where you have a liquidation and everyone goes back to their place and you're guaranteed another one. bull market that to me speaks to the complacency that we've seen in this market, you know, there's a lot of talk here about the Fed going off the rails on this, but everything you mentioned, I mean, there's inflation, President Trump said we have inflation in in control, I'm not sure 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, clearly Koster is going up, the Federal Reserve is doing everything right.

However, I will say this and I don't know if people would be okay with it if the Fed pulls back in December due to what could potentially be a market sell-off. The Fed lowers the markets the S&P is down 5% from all the credibility they need for the feds credibility they need to remain the market responds to a Fed rate hike at this point because we are recovering and we are at the highs again and the Fed raises rates then I think you have a problem if we are at the lows and we have discounted this December increase then you know why the provider started with Powell's comments on October 2nd in comments on the 3rd October than to start falling off a cliff, this is all generated by Powell, which was a risk event if he pulls back, everyone thought he was aggressive, so to your question, if he pulls back, it's double, it has to be the same. reverse of what we have already seen.

Why should you buy the market? It cannot be considered good. The Fed really didn't want to abandon this path, but they have to. Things are so bad. I think they will rise. I think I believe what he said. What I was saying is that we can go a little overboard based on inflation, so no one could explain why we haven't seen it, we see pockets of it, so here's a question, if you see inflation and say: Oh, inflation in the economy is a good What happens for the right reasons is economic growth. What if you see inflation in the economy and it is man-made inflation?

It's a self-inflicted euphoria caused by tariffs caused by higher oil prices due to sanctions on Iran, it's just that the casino doesn't inflate and it goes on and on. In addition to that question, they have to think about the implications for the market. They have a job that is already impossible and then it is extraordinarily impossible. They cannot attempt to navigate a market in this environment. They can't stick the landing on the market and try. raising rates and trying to think about everything you just said is impossible. I think they have to raise rates. I agree and I think just go back historically, look at the rates, look at this quarter we're talking about, I mean, I actually said much bigger, I agree, but the path from three percent to three and a quarter percent in the 10-year bond is volatility, but what needs to be taken into account for the Federal Reserve is to remember that we are talking about inflation, its main indicators flash and inflation expectations. and that hasn't gone up at all, so if I'm the Fed and I'm looking at this and I say, you know what happens if I don't go up, I lose credibility because the market went down?

All the indicators I see as a The Federal Reserve doesn't have inflation expectations, why wouldn't it? Why would I go out of my way to raise hikes at this time? I think they do leave. I think it will be a headwind for the market, but in the short term it is possible that this tradable rebound will occur. okay even though there is a big sell off today our next guest sees a year end rally shaping up says let's buy the dip to learn more about that let's bring in a bottom strategy Tom Lee this is the dip what is bought, yes, you already know what it is. a crash where the VIX has skyrocketed, we've basically had a cascading collapse and we know we're entering this period where 74 percent of active managers are behind their benchmark, so I think the urgency or momentum of the markets is really putting capital work into some sort of near return, meaning a rally, do you think the declines that we saw in the markets today are really as bad as they look on paper if you Do you take into account the role that ETFs are playing in these markets? and that you're selling when you sell three of the ETFs that you probably own, you're selling the same stocks over and over again, yeah, I mean, today there's a huge correlation that's gone up in all the markets and part of that is that there's deleveraging when the rates are high and when volatility spikes and we know that the risk parity funds were overweight bonds, so I think this is a lot to balance positions, but once this is behind us, I think people have to think about where the opportunities are, especially under inflation and Stocks 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 do your quantitative models say about this? Let's take the emotion out of it. What are the machines set up so you know almost quant funds? universally like growth and even our Sam Doctors quantum model will overweight growth, which is why one of the things that people have most in abundance today is long-term credit, whether through bonds or through growth stocks. , which are assets oflong duration, so a shift towards higher rates is a shift towards acid intensity, you want them to be long-term assets, not duration, which means you may want to think about Odin owning growth value stocks Now what do assets look like so you know stocks are assets?

I don't know what you're saying, but then the saying used to be that it's harder to generate a lot of e to offset PE, so in a world with rising inflation, an asset-intensive business like finance can generate tons of leverage. profits because the assets are growing, they are deleveraging and they can also gain margin if you are an asset. As a company like an rnd based company, it is difficult to keep up with inflation because you have labor costs and all you have are units that grow for you, so asset based companies are appreciated to get back on top, So I'll play devil's advocate. the S&P is down 5% from an all-time high, although three of those percentage points are worth today what needs to change for it to be among the lowest and maybe this is the start of something bigger, well the only metric we look at Be very careful with the yield curve because you cannot fight an inverted yield curve which indicates that confidence in the future has gotten so bad that markets contract;

We've had kind of an improvement in future expectations, so I'll remind you that you said risk parity the last time we had this risk parity event we were trading down about 11 to 12 percent, so that the guy had said that today it has gone down 6%, 3%. Basically, what is a technical bounce or is it a numerical percentage that we come out of for risk parity because risk parity has to be more or less the same linear? go up that much, it's percentage or technical, it's probably a little of both. Your wrist peg will want to overweight the low volume and underweight the high ball and the stock's relative drop to 20, actually, you know, it's a peak, but it's actually relatively. low volume so I think stocks get an allocation, but you might remember seasonals are really good.

I mean, you know the correction that happens, let's say in May or in the summer, is scary because we have bad seasonals, now we have good seasonals at a time when there is yield chasing, so I really think it's a good opportunity. The last question I want to highlight the message that you are sending to the viewers right now and that is that you buy the dip but you want to buy the value stocks that are going to your end, that is where the rally will be or will it be a broad based rally with the Same old players playing along with the fang stocks, the tech stocks, yeah, so I think I have two frames heading into the end of the year.

I think people go back to their favorites on their shelves, so all these Fang names that have regressed seem really cheap because they probably wanted to buy them at these levels or, you know, PayPal in the '70s, but next year I think which is a broader markets story, it's very narrow this year and it's more asset based, which is inflation, the traits of inflation and it's probably a shift towards value. I mean, that's one of them. I think the biggest moments happening this year, Tom, good to see you, thank you. Great to see you guys.

It's just a fun strategy. Tom's Market Playbook I'm a Little Listener I'm always a half-empty person, so I'd love to be an optimist. I am, by definition, I'm not, so I think this is the start of something, now I'm not. I say 20%, but between 12 and 15% given the double tops we did up to Steve's technical point, the S&P, I think there is still more pain to come, we are all over this market so we often have to hedge it in every angle After a wild day on Wall Street, at first there was a sea of ​​red on the street, but despite the pain, there were a number of bright spots amidst the chaos, they will tell you what they are, what they could mean for the markets and the big techs.

Today's loser is down almost 5% as the market leaders remain the biggest sellers, but a top technologist says there's opportunity amid the chaos and he'll tell us which beaten tech names he's buying this time. moment. We're live from Times Square in New York City it's a lot more fast money right after this, a perfect Tim you'll never know from the outside, so we go beyond the gifts and glamor of cars to give you the real picture , good, bad or ugly, because we know that you have to really appreciate your car, you have to go beyond its surface Beauty in full swing India's most authoritative car guide right now only on CNBC

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